UMaine Economist Assesses Calais Racino Revenue Potential
Contact: Todd Gabe, (207) 581-3307; George Manlove, (207) 581-3756
ORONO — A University of Maine economist estimates that the racino in Calais proposed by the Passamaquoddy Tribe could generate between $11.9 million and $13 million in slot machine revenue.
Todd Gabe, associate professor in the UMaine School of Economics and a fellow in the Center for Tourism Research and Outreach, says that without a detailed survey of racino patrons, it is impossible to determine how much of the nearly $13 million would be new money to the region or cash that would have been spent there anyways on other goods and services.
Gabe emphasizes that the results of his study are intended to be just one piece of information to be considered along with other economic and non-economic issues in the coming debates about the expansion of slot machine gaming into Downeast Maine. Voters will be asked in a statewide November referendum whether to allow the Passamaquoddy Tribe to develop a racino with up to 1,500 slot machines in Washington County.
The report, Gabe says, “gives people an idea of the amount of revenue that a facility like this would generate, if Mainers and visitors to Maine gamble at the national average.”
Some of the $11.9 million to $13 million generated by the proposed facility would be taxed by the state, kept by racino operators, and used to pay the wages and salaries of racino employees.
Gabe’s assessment is based on analyses of other U.S. states and casinos, including Hollywood Slots in Bangor. Gabe notes that he excluded Nevada, “because of Las Vegas’ extraordinary nature as the ‘gaming capital’ of the United States and the large number of worldwide visitors that it attracts.”
Gabe’s research assumes that a casino in Calais would attract people from within a two-and-a-half-hour drive, including residents of nearby New Brunswick, Canada.
Gabe concludes that the proposed racino would have a large impact locally relative to the size of Calais’ hospitality industry. Gabe notes, “the projected impact of $11.9 million to $13 million in slot machine revenue is actually larger than the total sales generated by restaurants and hotels in the Calais area.” By comparison, slot machine revenues at Hollywood Slots are equivalent to less than 20 percent of total hospitality sales in the Bangor region.
Gabe conducted the study at the request of the Passamaquoddy Tribe, but he received no compensation for the research. This project builds on his earlier work on casinos and, more broadly, the tourism industry, he says.
For further details, Gabe can be reached at the University of Maine School of Economics at (207) 581-3307.