Texans Fuel Oklahoma Tribal Gaming’s Record Month

Written By Tyler Andrews on September 21, 2022
Oklahoma tribal gaming paid record fees to the state in August

Oklahoma tribal gaming paid a record $17.88 million in exclusivity fees to the state in August. Last month’s totals broke the previous record set in May 2021, when tribal casinos brought in $17.77 million in fees.

The record month caps a strong spring-summer season for Oklahoma tribal gaming and also rides a wave of economic prosperity in both Oklahoma and Texas. While legal Texas casinos are still a ways off – currently only online sweepstakes casinos are legal in the state – most North Texans consider the two major tribal casinos on the Red River border – Winstar and Choctaw – their local gaming venues.

Wages are jumping and spending is high

The Oklahoman, which originally reported on the story, attributed the record revenues to consumer spending being on the rise in both Texas and Oklahoma. Due to workforce shortages and competition among employers to attract employees, wages have risen and minimum-wage jobs have decreased steadily.

The increased income for Texans and Sooners is finding its way into casinos like the Winstar and Choctaw.

Historically, the April-August window has generated the highest earnings for Oklahoma casinos, with much of the traffic coming from Texas and other travelers. North Texans have an easy 90-mile jaunt to reach both the Winstar and the Choctaw, making the two Oklahoma mega casinos popular weekend getaways

Total tribal gaming revenue is up this year

Year-to-date exclusivity fees paid to the state are up 13% on 2021. 

  • January-August 2021 total exclusivity fees paid to the state: $112.68 million
  • January-August 2022 total exclusivity fees paid to the state: $130.2 million

These totals suggest the growing economic prosperity of tribal gaming – but only indirectly. Tribes are not required to disclose their earnings to the public, but exclusivity fees are based on percentages of total earnings. The rise in exclusivity fees correlates with a rise in revenue. 

Specifically, tribes pay the following percentage rates of their revenue to the state:

  • 4% of the first $10 million of Adjusted Gross Revenue
  • 5% of the next $10 million of AGR
  • 6% of AGR over $20 million
  • Table games pay 10% of monthly net revenue

Legal Texas gaming would aid Texas social services

Thirty three of the 38 federally-recognized tribes in Oklahoma have at least one casino or gaming facility on their lands. Gaming revenue from these facilities often serves a majority of the tribes’ financial needs, both current and future. 

Tribal revenue generated for the state of Oklahoma mainly serves public education and Medicaid programs. The Oklahoma Native Impact Report, commissioned by the Oklahoma Tribal Finance Consortium, found that in 2019, tribal revenue (most of which was gaming-related) accounted for the following:

  • Over $1.8 billion in exclusivity fees for public education and mental health services
  • $84 million in additional support to schools, municipalities and other community initiatives
  • $232 million paid in Medicaid expenditures at tribal health care facilities
  • Saved Oklahoma $86 million by requiring no state matching Medicaid funds

OK tribes would suffer from legal Texas gaming

Were Texas to legalize gaming in any form, the consensus view among gaming experts and tribal authorities is that it would be a game-changer for Sooner gaming revenue. 

Gaming revenues, especially from the two major Red River casinos, would plummet. Legal Texas gaming would also chip away at employment in the two major casinos. Over 60% of employees at Winstar and Choctaw come from North Texas. 

Finally, legal Texas casinos, in trimming off revenue from Oklahoma tribal casinos, would also diminish the agency of those tribes. This effect would be felt most significantly in those smaller tribes where a tribal casino provides the main economic artery to the tribal economy.

It’s only a matter of time for OK tribal gaming

The reality is that all these things will come to pass as more states legalize gaming and sports betting.

For Texans, the matter will hinge on when the Legislature decides that the unregulated gaming currently running rampant in the state is too much to ignore.

Photo by Shutterstock
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Tyler Andrews

Tyler contributes predominantly to PlayTexas.com, covering sports, sports law, and gambling for the Lone Star State. However, he has covered similar topics for PlayCA, PlayFlorida, PlayOhio, and PlayMA. Tyler’s current focus is Texas’s pathway to gaming legalization.

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