Ameristar's baccarat room is shown. Provided photo
Ameristar's baccarat room is shown. Provided photo
Northwest Indiana's casino industry illustrates in spades the Region's place in both the Hoosier state and the Chicago metropolis.

The official Facebook page for Horseshoe Hammond bills it as Horseshoe Chicago; one for Ameristar East Chicago calls it "Chi-Town's best table action." The casinos advertise regularly on Chicago TV and radio — a recent TV ad for Gary's Majestic Star uses the tagline "Just 35 minutes from downtown Chicago."

But the casinos here are regulated by — and pay taxes to — the state of Indiana and its local governments. Northwest Indiana is home to a third of the state's gambling operations, but takes in nearly half its gaming revenue, and pays almost half its wagering and admissions taxes.

And among the nine full-fledged casinos that count guest admissions, Northwest Indiana's four bring in 61 percent of the total.

The Chicago connection

Horseshoe Casino in Hammond is Indiana's largest casino, and comparable to Illinois' biggest, the Rivers Casino in Des Plaines north of the city. Horseshoe covers 108,000 square feet, with more than 2,000 electronic games and more than 1,000 table games. It took in more than $418 million at its table games and slot machines in fiscal 2016 — the next closest in Indiana is Horseshoe Southern at $250.8 million.

A survey done 15 years ago as part of an Indiana University evaluation of Horseshoe Casino showed 55.4 percent of casino guests were from Chicago. That snapshot backed earlier surveys that showed more than 70 percent as coming from out of state at the Hammond and East Chicago casinos.

The connection to Chicago not only helps Horseshoe top Indiana's rankings, it sustains neighboring casinos as well. Ameristar in East Chicago posted a win of $230 million in fiscal 2016; Gary's two Majestic Star boats won $158 million; and Michigan City's Blue Chip $162 million.

The Chicago connection boosts local and state government tax receipts — and costs Illinois governments in turn. The Illinois Gaming Board's 1996 annual report noted the opening of three casinos in Hammond and Gary that year, and their impact on adjusted gross revenue — the money the casinos' won through their gaminng operations — at Joliet's two casinos.

"Historically amongst the leaders in AGR for the state, Empress-Joliet and Harrah's Joliet Casino saw a combined decline of nearly 3 percent in admissions and 14 percent in AGR," the board reported.

A year later, Illinois reported growing gambling revenue in the greater Chicago area, hitting about $1.3 billion in 1997. Indiana's casinos took in nearly half that.

"Of the total gaming revenues for the Chicago market area in 1997," according to the gaming board, "approximately 54 percent was captured by the four Illinois licensees."

Chicago's opportunity

"It's a huge market," said Ed Feigenbaum, publisher of the Indiana Gaming Insight newsletter, and it offers the opportunity to bring patrons in "to take advantage of the Chicago amenities while gambling at Horseshoe, Ameristar and Majestic Star."

Professional sports playoff games, big concerts or other events can attract gamblers to Chicago who also want time at the gaming tables, Feigenbaum said. "The ability to tap into that is important for Northwest Indiana casinos."

Chicago's residents provide a prime source of casino patrons. And, "you've got discreet groups within that population," Fiegenbaum noted.

Northwest Indiana's casinos run dozens of free shuttle buses from various locations in Chicago throughout the day and night, serving Wrigleyville, the Gold Coast, downtown, and — with more than 50 round trips per day — Chinatown.

Marketing to that community includes more than rides — casinos offer gaming rooms with popular Asian games, as well as Asian food.

Chicago's challenges

Northwest Indiana casinos' total gaming revenue of about $969 million in fiscal 2016 compares to $336 million at Indiana's three casinos near Cincinnati, which were hurt when a casino and two racinos opened on the Ohio side of the state line in 2013.

For Northwest Indiana's casinos, the main threat recently from across the state line has been video-based gambling in restaurants, bars and other businesses in Illinois. Operators of traditional casinos have consistently said those machines are taking a significant bite out of their slot machine revenue, particularly through the loss of more casual gamblers.

The possibility of a Chicago casino is still discussed, though it remains unresolved. Feigenbaum suggested that wouldn't be as big a threat as a south suburban casino, discussed several years ago, might have been.

With a downtown casino, he said, "you're really looking to attract the people who are from out of town."

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