The impacts of COVID-19 taught us that our livelihoods could be taken quickly, and without remorse. For a few weeks in March, the Financial Audit become the last of our clients worries, and for good reason, the world had been put on pause. Casinos were closed to preserve the safety of their guest, employees, and tribal members, and, in response, the revenues stopped. Most Casinos had problems that they had never expected, such as locking the un-lockable 24-hour doors, reconciling their ATM machines perfectly, and furloughing over 90% of their staff. These emergency responsibilities became those of only a few, and desperate times provoked desperate measures.
At one property, the decision on whether to pay out employees for the initial two week furlough was left to a mid-level payroll manager who shared with me that her hand was shaking as she pressed the “execute transaction” button enabling hundreds of thousands of salaries and wages without the proper approvals and nobody to ask. One location had issues with their gaming machines and decided to keep the machines on to prevent IT issues. Several locations had never shut their doors before, and quickly realized that the doors were unable to lock.
The offices were solemn as we walked in for our audits (more-so than usual when people see the auditors), and several theories of the future were shared and discussed.
Then, in July there was a shift. The PPP loan was distributed, the Coronavirus Relief Fund was activated, and business was booming!
But, what now? Both Tribal and non-Tribal Casinos nationwide faced demise and escaped red handed, and now Tribal Governments are receiving both more money in grants and looser restrictions on their current cash than ever before. Some examples of the influx of opportunity are that Fuel Tax revenue in many states are no longer restricted for certain purposes, the Coronavirus Relief Fund has issued Billions of dollars, and Casinos are breaking revenue records almost like clockwork.
It is no surprise that the effects (and potential effects) of COVID-19 have opened Tribal Leadership’s eyes to the necessity for diversification.
On July 6, 2021 the New York Times published an article, “Native American Tribes Move to Make Real Estate a Force for Renewal” by Linda Baker, which discusses several tribes ambitious pursuits in buying commercial and residential real estate. On June 17, 2021 the Sant Clarita Valley newspaper, The Signal, published an article, “Palms deal continues growth of Native American ownership of Nevada casinos”, which discusses the $650M purchase of the Palms Casino by the Manual Tribe.
It’s popularly suggested to avoid putting all your eggs in one basket, and until recently a lot of Tribes had been reliant of the cash transfers of their cash cow Casinos. COVID-19, however, taught us that these cash cows can be swiftly taken away. It’s time to look into new revenue generating enterprises and use the recent influx of cash to diversify. There are several attractive businesses to build, but I believe investing in already established enterprises outside of the Reservation can be beneficial to the growth of both tribal member opportunity and long-term enterprise.