The president and CEO of the American Gaming Association Thursday said the “road to recovery will have some bumps” but struck an optimistic tone about the industry in 2021 and continued growth of sports betting and iGaming as the nation continues to deal with the coronavirus pandemic.
“We’re all eager to focus on the brighter year ahead, and we have good reason to be optimistic,” said Bill Miller. “COVID-19 vaccines are rolling out: 25 million vaccine shots have been given in the U.S. and more than one million were delivered every day last week. … Every day we move closer to reopening the global economy. I believe there’s huge pent-up demand for gaming – and I’m upbeat about the second half of the year in particular. People will be excited to travel as vaccines roll out — hungry for entertainment and desperate to escape from their homes and just have fun again. That’s an environment where gaming will thrive.”
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Miller said the Biden Administration is focused on healing political divisions and providing more economic relief. Consumer confidence is slowly growing and recent AGA research shows one in three American adults plan to visit a casino in 2021 — the highest since the AGA began tracking that in March.
“Our customers also recognize our leadership on responsible reopening as about 80 percent of future visitors agree the industry has done a good job at safely reopening,” Miller said. “But optimism is no excuse for complacency.”
Miller said the AGA’s top priority is accelerating gaming’s recovery. To achieve this, he said they’re focusing to secure greater economic relief for gaming.
AGA’s 2021 Gaming Preview with @BillMillerAGA is about to begin! Join below or follow along here for AGA’s 2021 gaming outlook and to learn our priorities to accelerate the industry’s recovery. https://t.co/JVIum7W2Z7
— American Gaming Association (@AmericanGaming) January 28, 2021
In 2020, Miller said gaming got fair treatment in federal legislation responding to the economic devastation of COVID-19 — a first in our industry’s history. During 9/11, Hurricane Katrina, the Great Recession, Superstorm Sandy, the gaming industry was specifically cut out when the rest of the business community received support, he said
The Biden Administration has proposed $1.9 trillion in new COVID-relief legislation, and Miller said they will make sure gaming is included in that – just as it was in the original CARES Act passed last spring.
“We are fighting to save gaming jobs,” Miller said. “We will pursue new tax policies that support gaming companies who keep employees on the payroll and rehire laid-off workers. Our industry needs targeted and temporary liability protections to continue the process of reopening safely and contributing to the economic health of the country. We’re also seeking tax incentives to revitalize travel and tourism – including bringing back meetings and conventions. And we are pursuing additional relief for tribal nations struggling with lost gaming jobs and casino revenues.”
Miller said he sent a letter today to the Biden administration and every member of the 117th Congress, including the 45 new members from gaming states, to make sure they understand their priorities and the critical role gaming plays in supporting their local economies, driving job creation, helping small businesses, and funding vital public services.
“Policymakers that understand our impact are more likely to support our goals, and we intend to use this momentum to help promote gaming’s recovery in 2021 and beyond,” Miller said.
The industry will fight what Miller called harmful policies while advancing specific reforms that enhance industry competitiveness. Policies that hinder gaming’s growth also hurt the communities where gaming operates, he said.
“That’s why we will oppose any short-sighted attempt by Congress to enact new federal taxes or impose new mandates,” Miller said. “It’s also well past time to raise the $1,200 slot tax reporting threshold, which hasn’t been updated since Jimmy Carter was in office. The end-of-year omnibus spending bill directed the Department of Treasury to review this administrative burden and we are hopeful 2021 will bring progress on this important issue.”
At the state level, Miller said they will remain vigilant by pushing back against any attempt to increase gaming taxes. He said that’s not to say that they don’t appreciate the weight of this pandemic on state revenue because the industry felt that with limited operations and spiking costs. “In 2019, our industry contributed more than $10 billion to state governments through gaming taxes alone,” Miller said. “When you combine these taxes with sales, property, and other corporate- and business-related tax costs, we often shoulder an overall higher tax rate than any other industry. We will oppose any attempts to add to this already-outsized burden.”
Sports betting outlook
To generate growth in 2021, Miller said legal sports betting and iGaming, which served as crucial revenue backstops in 2020, will be essential. When all the numbers are in for 2020, legal sports betting handle will have surpassed $21 billion wagered — generating more than $210 million in state and local taxes. Mobile sports betting played a key role, accounting for 82 percent of wagers since March. iGaming, while active in only four states, generated nearly $1.4 billion in revenue and $340 million in taxes through November.
“The impact of the pandemic would have been far more devastating had it not been for legal, mobile gaming options,” Miller said. “Because of this, getting legal sports betting right has never been more important.”
Through today, 25 states and the District of Columbia have legalized sports betting and more are on the way, Miller said. Activations in Michigan and Virginia last week made legal sports betting options available to an additional 14.5 million American adults. As of today, 92 million American adults can bet on sports legally in their home state – a remarkable growth story since the Supreme Court’s decision in 2018, he said.
Twelve new states have started to pursue sports betting legalization this year and by the AGA’s estimation at least six new markets will legalize and open in 2021, he said.
“Legal sports betting continues to break records every month and that will continue into 2021,” Miller said. “If the sports betting market grows at just half the rate it did in 2020, Americans will legally bet more than $25 billion on sports this year. In order for this to happen, our efforts to fight illegal sportsbooks become even more important and we will continue to work with regulators, leagues, teams, media companies, and others to promote responsible sports wagering.”
Payments modernization was another bright spot in 2020 and the AGA is committed to seeing this through in 2021, Miller said. Digital payments not only allow gaming to offer customers a better gaming experience, they also promote responsible gaming and help fight money laundering, he said.
“We’re meeting with state and tribal regulators and sharing leading examples of what our members are doing on payment choice as these innovations make their way to the casino floor all across the country,” Miller said. “We’ll also continue our fight against the proliferation of illegal, unregulated gaming machines. These machines take market share from licensed operators, provide little benefit to state economies, and don’t offer any responsible gaming protections.”