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A First Good Year for Navajo's First Casino

Navajo Times, News Feature, Bill Donovan Posted: Nov 06, 2009

WINDOW ROCK, Ariz.--During its first year of operation, Fire Rock Navajo Casino saw more than 1.3 million people walk through its doors.

Of course, most were repeat customers but the number of visits nevertheless speaks to the casino's popularity with its predominantly Navajo clientele, which has surpassed all expectations. Even during the weekday mornings and afternoons, when business is slowest, the main parking lot at Fire Rock is usually at least half full.

And on Friday and Saturday evenings, or the first of the month, the parking lot is full and 90 percent of the slots are in use.

All of this points to a remarkable first year for the Navajo Nation's first casino.

The Players Club now lists more than 51,000 members, 70 percent of them Navajo. This too, said Bob Winter, CEO of the Navajo Gaming Enterprise, far exceeds the projections.

So how much money has the casino made?

That's still a secret, shared only with state and federal gaming officials and a few high-ranking tribal officials.

But Winter said Fire Rock is making a profit and paying its bills and then some, which gives a ballpark figure on how much the casino is raking in.

By the numbers

The employees - who now number 312, of which 92 percent are Navajo - earned $11 million during the past year. With benefits, that brings the cost to the casino to more than $1 million a month.

The casino also spent $1.2 million on food and beverage supplies, mostly from vendors within a 50-mile radius of Gallup, and another $500,000 on retail goods - another indication of its impact on the local economy.

The gaming enterprise borrowed $34 million in start-up money from the Navajo Nation and is on track to repay the tribe within three years.

The enterprise recently made its first payment - early, by the way - and Winter said he expects the enterprise will have no problem making the balloon payment at the end of the three years.

This would indicate another $1 million in revenue is coming in each month, for a total of more than $2.3 million monthly just to cover costs and debt service.

Since the casino retains only about 6 cents of every dollar gambled at the casino, that means for every $1 million bet, all but $60,000 goes back out to the lucky winners.

By that formula, it would take more than $40 million a month in gross betting revenues to generate enough retained income to cover the casino's costs - or almost half a billion dollars per year.

Of course, the house takes 6 percent every time a dollar is bet, so when players continue to bet their winnings - and most do - the casino winds up with more than 6 cents of that dollar.

Winter claims that Fire Rock is known for having "loosest slots of any Indian casino in New Mexico, if not the Southwest," thanks to a decision early on by the enterprise to give back as much to the players as possible.

Casino officials have tracked customer spending patterns and say the average player bets a little over $21 in up to two hours of play.

"We want people to come here and have fun," Winter said, adding that the loose slots create a great deal of positive word-of-mouth among gaming fans and has contributed to the high attendance numbers.

Fire Rock, unlike other casinos, doesn't publicize its big winners but several people have left with more than $10,000 in their pockets, he said. So far no one has hit the $1 million or $100,000 jackpots on the progressive slots at Fire Rock.

Winter said several people have won four or five fairly big jackpots - probably $3,000 or more - and just recently, one person won their sixth jackpot.

Other success factors

Two other areas of successs are worth mentioning.

The bingo operation, which for the first few months was losing money or just breaking even, is now making a profit although the casino reduced the number of seats from 550 to 250 to make more room for slots.

With people able to win as much as $1,000 during various promotions, attendance usually fills up most of the seats.

Originally, bingo was not in the plans for the casino but Church Rock Chapter made bingo the dealmaker for giving its OK to the casino.

Another bright spot in recent months has been the restaurant, which lagged at first because of the lack of a liquor license.

But the restaurant began promoting Taco Tuesdays and Seafood Thursday and business picked up substantially, especially among the non-Native population in the Gallup area.

Although the casino hasn't promoted the fact a lot, the enterprise has agreed to contribute at least $70,000 during its first year of operations to help various events in this area, such as the Navajo Nation Fair, the International Indian Finals Rodeo and the Inter-tribal Indian Ceremonial.

"We are not allowed to contribute to charities but we can help out events such as this if it provides a benefit to us," Winter said.

The casino uses funds from its marketing budget and justifies the expense because being an event sponsor provides a form of advertising.

For example, although the tribe has no casino yet in the Farmington area, the gaming enterprise helped out the International lndian Finals Rodeo, held this year in Farmington, because it was a way to establish a presence in an area where a future Navajo casino is planned.

Another thing to realize about Fire Rock's first year is that it was free of the kind of disputes that have plagued many other Indian casinos.

This has happened at other casinos, said Ray Etcitty, the enterprise's legal counsel, attributes this to the separation maintained between the gaming enterprise board and the tribal council.

Tribes that put their council members on the board overseeing casino operations oftentimes ended up with political disputes.

The Navajo Nation Council opted instead for a board made up of professional people, not politicians. Everyone on the NNGE board has an MBA or a law degree, Etcitty said.

Tribes that have politics-ridden gaming boards are looking at what the Navajos did and using it as a model for reform, he said.

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