Casinos rake in 8.8 percent more

Nevada casinos won 8.8 percent more in fiscal 1999.

According to figures in the Nevada Gaming Abstract, total gaming revenue in Nevada casinos rose to $8.4 billion. When food and beverage, rooms and other earnings are added in, the state's casinos reported total revenues of $15.4 billion for the year - a 10.9 percent increase over fiscal 1998.

But the $8.4 billion number is especially important to the state because that's the number the gross gaming tax is applied to, and that tax provides about 40 percent of total state general fund revenues.

Gaming Control Board Analyst Frank Streshley said for the first time in the state's history, gambling accounted for less than half the total revenue earned on the Las Vegas Strip - 48.1 percent. Statewide, gambling winnings are now 54 percent of the total revenue collected by resorts.

Just 10 years ago, that percentage was nearly 62 percent.

The 1999 numbers are the biggest annual increase in both gambling and total revenues since 1994.

The net income reported by resorts statewide was down sharply, but mostly because of changes in how the net was calculated for 1999. Unlike the past, resorts were allowed to deduct "corporate expenses" from their net profits. That makes no difference in figuring out the taxes resorts owe the state, which are figured on the $8.4 billion in gross gaming revenues.

But adding in corporate-level expenses such as interest, internal audit, management information systems and corporate payrolls helped to increase total general and administrative expenses by $901 million in 1999. The biggest single increase in deducted expenses is the interest casinos are paying on huge construction projects which more than doubled from $355 million to $726 million this past year.

Primarily because of the accounting change, net income for Nevada casinos dropped from $1.13 billion - an 8.2 percent profit margin - in Fiscal 1998 to $876 million - a 5.7 percent profit margin - in 1999.

Casinos argue those expenses should be deducted from profit totals to show people what the resorts really make.

Altogether, that is a 22.7 percent drop in net income.

A total of 238 casinos in the state paid the state $633.5 million in gaming taxes and fees during 1999.

In the Carson Valley area including the capital and valley portions of Douglas County, 10 casinos generated $122.5 million total, $80.9 million in gaming revenues and $6.2 million in net income.

Washoe County recorded $1.8 billion in total revenues and $1 billion in gaming revenues and a combined net income of $76.9 million from 39 casinos. South Lake Tahoe reported $520.4 million total and $326.5 million in gaming revenues from five casinos and net income of $31.8 million.

The vast majority of the gaming money comes from 144 casinos in Clark County which generated $12.5 billion in revenue, $6.7 billion in gaming revenue and net profits of $712.3 million.