The Eastern Band of Cherokee Indians in North Carolina is betting on a $110 million development to boost revenues in its casino and gain a stranglehold on gambling in the southeastern portion of the state. The new casino, Harrah's Cherokee Valley River, is the second for the Cherokees in that part of North Carolina.
The new casino has its detractors. The Cherokee's leaders say the new development could cannibalize traffic from the old one. Also, $110 million is a lot of money to collect overflow from the tribe's other gaming venue. But not only does the tribe think a second property is going to discourage other gaming companies from entering the region, but they also believe the casino could draw gamblers from nearby states--especially Tennessee.
Harrah's Casino Valley River
The location is 60 miles away from the Gatlinburg casino, just across the border from Tennessee. Michell Hicks, who is the principal chief of the Eastern Band of Cherokees, said that their research shows the casino should collect gamblers from the Chattanooga, Lexington, and Atlanta metropolitan areas.
Michell, who did not run for a fourth term as Cherokee's chief, told ABC News in a phone interview, "That was the final determination on the feasibility: capturing parts of those three cities."
UNC Study on Tribal Gaming
A case study released this year from the UNC Kenan-Flagler Business School showed that the anti-gambling attitudes of the neighboring states' governments plays into the hands of the Cherokees. The states of Tennessee, Georgia, South Carolina, and Virginia do not have Las Vegas-style casinos. The competition for gamblers is nonexistent, which is good news for the Eastern Band.
Professor James Thompson, who co-wrote the review for UNC's Kenan-Flager School, says that the new development should have economic benefits for the south-western region of North Carolina. He also said players in nearby cities should receive the news well, because of that reception.
Professor Thompson said, "You get busloads of people coming in from Tennessee and Georgia."
Jobs Statistics for Cherokee Casinos
The UNC researcher said about 85% of the jobs in the other Cherokee casino are non-tribal peoples. He expects a similar or higher rate for the newest casino, which should employ about 900 people.
The poverty rate of the nearby counties in North Carolina has reached 18%. Anti-gambling activists would say that opening a new casino in a depressed area is predatory, but that overlooks the jobs growth and the amount of money flowing in from outside those counties. 900 families should be helped by the casino's opening, while the local area should receive an influx of cash. That, in turn, helps other local businesses, which has an indirect positive effect on communities.
2% Growth in US Gaming
The United States gambling industry has itself had troules since the Great Recession. The past few years has seen 2% growth, which barely keeps up with the population growth. With such little growth and regional concerns about market saturation, Native American tribes have been loathe to open new venues. The Casino City Indian Gaming Industry Report reported only two new openings in 2013.
That has not been the case with the Eastern Band of Cherokee Indians, whose casino's revenue growth was 16% in 2013. Such growth convinced leaders that a new casino would be a good idea.
Alan Meister on Gaming Expansion
Gaming analyst Alan Meister says you will find new facilities in areas with enough room to expand. Southwestern North Carolina is one of those places. Meister said, "Where you're seeing more activity in recent years has been the expansion of existing facilities."
Like most other businesses, those operators who invest often see a return on their investment--if they have a good product. The Cherokees of North Carolina opened a new casino in 2013. They also lobbied for the expansion of blackjack and other table games. Sure enough, those changes were a key part of the Cherokees pulling down $500 million in 2013--the first time that figure had been reached.
Some Prefer Old Casino
Not everyone wants to play at the new facility. The newer casino is smaller than the old one, with only 70 table games, 1,000 slots, and 300 hotel rooms. For instance, 70-year-old Susan Page of Conyers, Georgia--once an insurance industry employee--says she plans to play at her traditional location.
Page says the older location has more to offer, so it's worth the additional 30 minutes of driving to play at a first-rate gaming area. Page added, "It's a lot smaller, and there are not a lot of amenities there."
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