Today the local papers had similar reports. Rachel Gallegos, "Casino revenue drops; October saw $1M less than September," Iowa City Press-Citizen, November 14, 2006, and Gregg Hennigan, "Revenue, attendance drop at new casino; Riverside CEO says numbers are within officials'’ expectations," The Gazette, November 14, 2006. (Both are available, together, here.)
And don't miss State29, "A Natural Decline," November 14, 2006.
As I read their reports, and reflect about mine, three things come to mind: (1) I think it is so great that both papers are following up on this story, getting into the publicly reported numbers, and bringing them to readers' attention.
(2) There's an ongoing story here about Iowa's economic development generally, attractions including gambling in particular, the extent to which gambling either contibutes to or detracts from the local economy and municipal governments that underwrite it, if Iowa is to have gambling casinos how competition impacts upon them and how many casinos are the optimum number -- and of course gambling's negatives, comparing eastern Iowa's pre-gambling casino numbers with those post-Riverside: domestic violence, bankruptcies, crime, DWI, suicides, and increased municipal (and state) costs for law enforcement and infrastructure (see, Nicholas Johnson, "Riverside's Deeper Gambling Debt," November 11, 2006).
(3) I don't think either I, or the local papers, have dug into the attendance and revenue data deeply enough.
(a) Sure there was a decline from the opening month to October. But that's to be expected with any new venue, whether gambling casino or stand-alone restaurant. Moreover, apparently there is a statewide decline from September to October for all of Iowa's casinos.
(b) What would be interesting to know is whether casinos close enough to Riverside to be competitive suffered more decline in attendance/revenue numbers than Iowa casinos not confronting new competition. (My memory is that there was some indication of that even from September's numbers.)
(c) Here are some rough numbers. I believe the opening three-day weekend brought in 50,000 visits. Subtract that from the 122,000 September visits, and divide that 72,000 by 27 days. That's an average of 2666 visits a day for the opening month (not counting the opening weekend). Attendance for October was 98,000. That's 16,000 more than the 82,000 the casino would have had if it had kept up the rate of visits from September (for the days other than the opening weekend). I may be way off with these rough calculations; but if not it would appear that there has not been the falling off of attendance one would expect. That's not to say the numbers look good in terms of meeting original projections for the first year, only that it may have been misleading to suggest there's been an unusual downturn.
(d) Aside from any extra attendance around the Thanksgiving and winter holidays, however, my guess is that we may see a real decline in attendance from December through March. Time will tell.
(e) A major factor to watch is the success of the golf course. How many months of play in 2007 will it provide? (You don't want hackers tearing up muddy fairways and greens before they're firmly in place.) Will it attract local golfers -- and, if so, more than once? How much revenue will it provide? How much money will each golfer leave in the casino, as distinguished from the pro shop, and how does that compare with those who only come to gamble? How many are hotel guests?
(e) As someone once said, "Prediction is difficult, especially about the future" -- something that's even more true about business. If the casino's owners can come within 10% of their first-year predictions for 12 months out I think they will have done pretty well at forecasting.
(f) I would prefer that Iowa not have gambling casinos. I don't think we can gamble ourselves into economic development. But that decision's been made. Moreover, Riverside, Iowa, wouldn't have been my first choice for a business like this -- and indeed it wasn't the promoters' first choice either. (They just knew they would never get the voters of Linn or Johnson County to approve it.) But if you're going to put it there, I think they've been about as creative as possible in trying to build on synergy: gambling, restaurants, hotel, golf course, spa, entertainment venue -- and at least plans for some kind of waterpark across the road.
Thanks again to Bradley Franzwa, State29, Rachel Gallegos and Gregg Hennigan for their reporting. This is going to continue to be an interesting and important story to follow as it unfolds.
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