Detroit has a lot to thank its local gambling businesses for. After qualms about the higher crime rate around casinos in the city were disproved, the city and Michigan as a state have reasons to thank the vibrant industry for supporting various aspects of public spending through what has been one of the worst economic downturns brought on by the COVID-19 pandemic and the near-complete shutdown of businesses across the United States and the world.
IGaming Revenue Bolsters Ailing Public Purse
In this context, Detroit mayor Mike Duggan is optimistic about the future and presented a budget this week which is not going to miss any key deliverables, and iGaming is much of the reason why. The budget was aptly named “Return to Normal” and the $1.2 billion financial plan has benefited amply from iGaming revenue, Duggan told the Detroit City Council where the budget was read and submitted for approval earlier this week.
In delivering the budget, Duggan argued that slot machines and table games at casinos alone have contributed $26.6 million in the fiscal 2021 and this number is very likely to go up to $71 million in 2022.
This is mostly the effect of enabling online gambling referred to as iGaming that effectively allows casinos to begin introducing remote gaming options that are more convenient and arguably drive a significant chunk of the gaming revenue up. A total of three casinos have switched their online gambling platforms on delivering some robust financial results.
Detroit Casinos Prove Lodestars of iGaming
The three casinos in Detroit that answered the iGaming call include Motorcity, Greektown, and MGM Grand. All three properties had to operate under a huge strain brought on by the COVID-19 pandemic with shutdowns looming and restricted capabilities throughout most of 2020.
This began to change in 2021 when casinos were able to collect $1.26 billion in winnings, or twice the number from 2020. Out of this amount, the gross gaming revenue realized through internet gaming stood at $1.1 billion last year. Sports betting operations brought in $110.6 million in income compared to $1 billion for online slots and table games.
The total taxes on internet gaming revenue realized $268.3 million and Detroit managed to claim $59.35 million of that. Internet gambling has proven its viability in a hurry and even though fears about gambling addiction were raised, the impact the revenue has had in bolstering up the budget has made skeptics more lenient on introducing online gambling.
This is not to say that Duggan did not have to act presciently early into the pandemic, as the city had to muster up $350 million in overall cuts from the budget to balance its spending and outlast the nadir of the pandemic. Internet gaming has been a life raft but there is still work to be done, Duggan cautions.