3 Detroit Casinos Renew Licenses; Reveal $107.2M In Profits
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Throughout its scheduled public meeting, the Michigan Gaming Control Board (MGCB) voted unopposed to validate license extensions for MotorCity Casino, MGM Grand Detroit and Hollywood Casino at Greektown, aka Detroit’s 3 licensed casinos. The next renewal process is scheduled for August 2024.
In addition, the same casinos revealed revenue data for July 2023, showing that the monthly aggregate income for the said month was $107.2 million, of which $106.7 million was collected from slots and table games and $477,543 from retail sports wagering. In terms of market share in July, it was: MGM (47%), MotorCity (29%) and Hollywood Casino at Greektown (24%).
Three votes are needed to renew a license:
Under the Michigan Gaming Control and Revenue Act, three votes, representing a quorum for the Board, are necessary to support final decisions on casino license applications. On that note, Henry Williams, MGCB Executive Director, commented: “Renewing a casino license reflects an ongoing commitment to operate a reputable and responsible establishment. It signifies a dedication to maintaining high standards of quality, security, and fair play within the industry. The renewal of these licenses is validation of the casinos’ commitment to operating as responsible and valued corporate citizens within Michigan that contribute positively to the state’s gambling industry while ensuring a safe and enjoyable experience for all patrons.”
However, when referring to the aforementioned Michigan Gaming Control and Revenue Act, it lays out the entire application process for a casino license as well as the info that applicants have to disclose to the MGCB. Regarding the renewal of the casino’s license, which is the case here, the aforementioned regulator must perform a “comprehensive evaluation of various aspects of the casino including its financial stability, operational integrity, and adherence to legal and regulatory frameworks as well as responsible gaming practices.”
Further, the taxation of license holders is 18% on adjusted gross receipts and their betting tax per day is transferred through electronic funds transfer. Additionally, the state of Michigan gets 8.1% and the City of Detroit gets 9.9% of the betting tax in addition to payments from the development agreement. However, casinos are also required to pay an 8.4% retail sports wagering tax on qualified adjusted gross receipts and a year-over-year state regulatory costs fee.
Promoting responsible gaming is one of the main requirements for license holders, meaning that they need to include “the state’s toll-free gambling helpline number, 800-270-7117, at all entrances and exits, on each electronic funds transfer terminal and credit location, and on all printed advertisements and promotional materials,” as responsible gambling promotion standards are involved in Michigan’s casino gaming law.
Income and taxes:
When looking at the income from slots and table games for the mentioned month, it grew by 4.8% compared to the accumulated profit from June 2023. Also, the income in July 2023 is higher by 0.7% compared to July last year, and slots and casino table games income for the period from January 1 to July 31 rose by 0.9% compared to the same quarter last year.
However, the gaming income from of the listed casinos were “mixed” compared to July last year:
“$8.65 million in taxes to the State of Michigan,” compared to $8.58 million for July 2022. As for the betting tax and payments from the development agreement, they announced that they paid $12.7million to the City of Detroit during said month.
Then there was $7.96 million in total retail sports wagering handle income and “total gross receipts were $485.763.” However, the qualified adjusted gross receipts (QAGR) of each of the respective casinos were:
- MGM: $121,017;
- MotorCity: negative ($40,723);
- Hollywood Casino at Greektown: $397,249;
Also, the total QAGR rose by $868.951 when compared to June of the same year. But, the said QAGR fell when compared to the same month in 2022 by 62.0%. In addition, regarding Michigan’s state gaming taxes, the casinos set aside $19.590 and announced a $23.944 betting tax payment to the City of Detroit for retail sports wagering income.
Fantasy contests income for July:
And the last adjusted income revealed was from fantasy contests operators, which was $1.4 million, of which $117.117 was set aside for taxes. Additionally, for the quarter that run from January 1 to July 31, they revealed $12.1 million in aggregate fantasy contest adjusted income, of which $1.0 million was paid for taxes.
