But the state doesn't think it's seeing major benefits. And what about those compacts, now in legal limbo?

On a recent Saturday night, 1,000 people sat at long tables, marking their cards in the smoke-filled bingo hall of Casino Sandia.

"It's amazing how many people come just to play bingo," said a guard standing at the door. "Usually there are just 500 to 700." One reason for the crowd: a shiny green Pontiac Grand Am will be given away. And two busloads of people have arrived from Denver and El Paso.

They join thousands of locals seated at slot machines and tables for 21, roulette, keno and blackjack in the cavernous Quonset huts trader the sign of the orange neon buffalo.

Visit New Mexico's gaming palaces, watch the crowds intent on these games and it seems obvious that the state's 10 tribes with gaming operations are the real winners.

Tribal officials will not disclose specifics but say that gaming proceeds have allowed them to purchase everything from police cars to bulldozers, school buses to vans for elderly programs, computers to scholarships. The finds also provide cash for bank loans and for other tribal businesses. Studies by academics and researchers show mixed results for state coffers - but everyone agrees that it's too early to tell the impact of this young industry, which is in limbo after the state supreme court ruled in July that Governor Gary Johnson exceeded his authority when he signed compacts with tribes last winter. Meanwhile, the tables are crowded.

"What gambling's done for the tribe is reduce the unemployment rate to 2 percent when it was well over 60 percent," said Joe Little, an attorney and financial officer with the Pojoaque Pueblo, which opened one casino three years ago and another in July. The gaming operation employs close to 700 people, which has impacted the entire county, said Little, considering the population of the pueblo is 250.

Jobs range from black jack dealers and restaurant workers to public relations and managerial jobs paying minimum wage to more than $30,000 a year.

Pojoaque's New Race Track

With the proceeds the pueblo has sunk money into other tribal enterprises and purchased The Downs, the race track in Santa Fe, which may become the site of other types of races, concerts, motor cycle rallies and commercial uses. The Pojoaque government has supplemented retirement income for its elderly, fixed up houses, and put money into social programs.

Bruce Sanchez, chairman of Southern Sandoval Investment Limited, the business development arm of the Santa Ana tribe, recites a list of amenities his tribe has purchased with gaming money: computers and software for schools, an expanded library, the hiring of counselors, a librarian and a director of education.

Tribal scholarships now sponsor 12 people in post-secondary education - "prior to gaming we had about two" enrolled in higher education, said Sanchez. They've hired additional police officers, bought police cars and equipment, trucks and bulldozers. Some of the money is supplementing businesses and is being used as collateral to acquire bank loans - vitally important because tribal land cannot be used as collateral.

Attorneys for Isleta and Acoma pueblos report similar economic and employment gains.

While all of this is good news for New Mexico's 10 gaming tribes, benefits to the state are less certain, depending on which study you read. A report by the Center for Applied Research of Denver for the New Mexico Indian Gaming Assn. says that in 1994, Indian gaming created 6,824 jobs, $106.6 million in income statewide and $3.1 million in state tax revenues.

The first six months of 1995 show an increase: 13,334 jobs, $215.5 million in annualized income and $4.6 million in state tax revenues.

More Jobs, More Revenue

It also says that in 1995, gaming provides direct employment for 2,650 people and an annual payroll of $46.6 million. And, that 70 percent of the total ($32.7 million) is spent in the state for consumption of goods and services.

However, a study by the state's taxation and revenue department issued on October 11, 1995 argues that gaming is siphoning money from the economy that would have been spent on other forms of entertainment and on retail goods. That, in turn, means less tax money is flowing into the state coffers.

Initial payments to the state by gaming tribes in the spring of 1995 ($43 million) translate to about $172 million a year, according to the report. "Unless you can entice people into New Mexico to gamble, you're taking money away from other sectors of the economy," said John Chavez, cabinet secretary for tax and rev.

"The money goes to the tribes instead, so the state is out that amount of money. What do the tribes do with the money? Even if the tribes pay it out as wages and salaries or to purchase goods in economy it's similar to what Wal-Mart would have done with the money. The net revenues to the state are the same in this scenario as if Wal-Mart got the money" said Tom Clifford, senior economist in tax and rev.

If the goods and services are purchased by the tribe and delivered on the reservation no gross receipts taxes are owed. And tribal members living and working on their own reservations pay no state income tax. That's because, by treaties with the federal government, the tribes are regarded as sovereign, just as the 50 states are.

"Depending on how much of the spending would have otherwise been taxable, the loss of gross receipts tax revenues ranges from $6.2 million to $9.3 million annually," according to the report. "The annualized payments by the tribes under compacts for the same period were $6.3 million."

The Gaming Impact

COPYRIGHT 1996 The New Mexico Business Journal
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