Frank Hawkins Kenan Institute of Private Enterprise

UNC Kenan-Flagler Business School

Cherokee Casino Impact

June 27, 2011

University of North Carolina at Chapel Hill study shows Cherokee Casino contributes $380 million to local economy

Chapel Hill, N.C. — Harrah's Cherokee Casino in western North Carolina contributes more than $380 million directly to its local economy and has brought significant economic and social benefit to one of the state's traditionally depressed regions, according to a new report by researchers at the University of North Carolina at Chapel Hill.

The report, "Assessing the Economic and Non-economic Impacts of Harrah's Cherokee Casino, North Carolina," describes the impact of the casino on the region and analyzes the routes of its economic impact. The casino, opened in Jackson County, N.C., in November 1997, has grown from a simple bingo operation to a large, complex, multi-product firm and tourist destination attracting 3.6 million visitors a year.

"The economic impact of the casino is large and dramatic," said James H. Johnson Jr., co-author of the report with John D. Kasarda and Steve Appold. Johnson is director of the Urban Investment Strategies Center at the Frank Hawkins Kenan Institute of Private Enterprise, part of UNC's Kenan-Flagler Business School. Kasarda is director of the Kenan Institute. Appold is a senior research associate.

"By attracting significant tourist spending to the region, a majority of which comes from out of state, the opening of Harrah's Cherokee Casino has had a clear positive impact on the economy of western North Carolina," Johnson said.

Among the economic benefits reported:

  • Visitor-generated gaming revenue totaled $386 million in 2010 after temporarily peaking at $449 million in 2007.
  • The economic impact of casino revenues on the local economy (Jackson and Swain counties) totaled approximately $300 million in 2009, with spending for capital improvements contributing an estimated $82 million more.
  • Casino hiring represents 5 percent of local employment and 8 percent of all wages and salary disbursements made in the two-county area.
  • Casino operational spending on wages and vendor purchases contributes more than $65 million to the local economy.
  • The casino's economic impact extends to the western N.C. region, boosting per capita income from 70 percent of the state average in the mid 1990s to more than 80 percent, reducing historically high unemployment rates and raising employment to the statewide average.

In addition, researchers said, the Cherokee Preservation Foundation, created with proceeds from the casino, has contributed additional social improvements, environmental enhancements, workforce development and cultural preservation in the region.

"The casino's operation has not solved all regional economic and social problems," Johnson said. "While life expectancy, poverty rates and educational attainment have improved, high school completion rates and enrollment of Cherokee students in the University of North Carolina system remain lower than those of other regional graduates, which are areas that should be addressed. However, all available evidence points towards a substantial improvement in regional well-being on almost all measurable dimensions and, although the mechanisms are often indirect, these improvements can be traced back to the establishment and expansion of Harrah's Cherokee Casino."

The casino impact study was funded by the Eastern Band of Cherokee, which owns the casino, Harrah's, which manages the casino, Cherokee Preservation Foundation and Advantage West, the regional economic development partnership for western North Carolina.

The Eastern Band of Cherokee primarily comprises descendants of Native Americans who avoided the forced removal by the federal government or "Trail of Tears" to Oklahoma in the 1830s. About 60 percent of the band's approximately 14,500 members live within the 56,000-acre Qualla Boundary, located in Jackson, Swain, Haywood, Graham and Cherokee counties of North Carolina. Most of the band's income derives from casino revenues.

Eastern Band Principal Chief Michell Hicks said the tribe commissioned the UNC study to confirm and quantify the casino's impact and provide data it can use to make strategic decisions about its future. It also seeks state approval to expand gaming operations.

"The results demonstrate that gaming has been good for the tribe, for western North Carolina and for the state," Hicks said. "It also shows the tribe has been a good steward of the proceeds, investing in our community and region in ways that enhance our economic and social health and vitality."

Contacts:

John D. Kasarda, Director
Frank Hawkins Kenan Institute of Private Enterprise
(919) 962-8201

James H. Johnson Jr., Director
Urban Investment Strategies Center, Kenan Institute of Private Enterprise
(919) 962-8201