Economic Impacts of the Enterprises of the Mdewakanton Sioux (Dakota) Community on Scott County

Source: Minnesota Department of Human Services, Cost Report for Calendar Year 1994, and Minnesota Extension Service, "Scott County Profile of Demographic, Social and Vital Statistics 1997”.

Exhibit 29 presents the food stamp allotments in Scott County for 1986 through 1996.

Exhibit 29 Food Stamps Allotments in Scott County, 1986-1996

Source: Minnesota Department of Human Services, Cost Report for Calendar Year 1994, and Minnesota Extension Service, "Scott County Profile of Demographic, Social and Vital Statistics 1997*.

The preceding exhibits show a general decline in the number and amount of welfare payments made to Scott County residents. The decrease in this type of public assistance and the number of participants in these programs is in an inverse relationship to the

Economic Impacts of the Enterprises of the Mdewakanton Sioux (Dakota) Community on Scott County

Advisors, Economic Benefits of Indian Gaming in the State of Minnesota, "an estimated 11.5 percent of persons employed at gaming operations received unemployment assistance prior to employment at the gaming operations, with another 5.7 percent receiving some form of public assistance and/or welfare prior to employment at Minnesota casinos. In addition, of those employees surveyed, more than 22 percent were out of work at least three months prior to casino employment, with over 15 percent being out of work for six months or more." Applying these percentages to the number of people employed by the Community results in approximately 450 people no longer receiving unemployment benefits and 223 people no longer on welfare or public assistance. These numbers do not reflect the indirect effects of the Community on employment, which are discussed in a later section. The following exhibit estimates the dollar amount of benefits paid to persons who were either unemployed or on welfare before being employed by the Community.

Exhibit 30 Estimated Dollar Amount of Unemployment and AFDC Cases
(amounts are monthly averages)

Other Factors

[1] Amount is an average for all cases based on employees surveyed.

12) Source: Minnesota Department of Human Services.

A portion of revenues generated by the Enterprises is distributed by the Tribal Government to individual Community members each year. As a result, a significant amount of this income is spent locally by tribal members on goods and services. This is unlike many businesses where profits may be exported out of the local community via dividends or to fund growth plans in other locations.

Another significant economic factor which should be considered in assessing SMSC's contribution to the local economy is that often employers of SMSC's magnitude are given incentives to locate their operation within a city or county. These incentives may range from property tax breaks to public infrastructure improvements. SMSC has received none of these types of incentives and therefore has saved taxpayer dollars.

Local businesses have highlighted the significant economic contribution made by the Community to the area's economy. The Community is the largest customer, being twice the size of any other account, of Minnesota Valley Electric Cooperative ("MVEC”), an electric cooperative that serves 20,000 consumer-owners. MVEC indicated that the Community has had a significant favorable impact on its business. The Community was able to "justify construction of a new ($1 million) substation in the area."

Economic Impacts of the Enterprises of the Mdewakanton Sioux (Dakota) Community on Scott County

William R. Engelhardt Associates, Inc., consulting engineers for the Community, made the following comments:

"Over the years the impact on our business has been such that we are able to dedicate staff consisting of engineers, engineering technicians, and construction inspectors to the Community's work. Staff personnel dedicate up to 95 percent of their time to Community projects which has an impact of 10 to 20 percent of our total business on an annual basis.

We have observed over the years that we have been associated with the
Community an increase in employment by the Community tenfold."

In addition, due to the low population of Scott County (approximately 69,000), the Enterprises rely heavily on residents of other counties and tourist visits to generate revenues. The following exhibit shows the number of adult visitors and children staying overnight at the Hotel/Casino during the twelve months ended August 31,

1997.

Exhibit 31 Mystic Lake Hotel Overnight Visitors – Year Ended August 31, 1997

Economic Impacts of the Enterprises of the Mdewakanton Sioux (Dakota) Community on Scott County

There are several items worth noting from the table above. Of the total overnight visitors of 75,930 for the year, 42,167 were from Minnesota. Of these Minnesota visitors, only 2,482 were from cities within Scott County. Therefore, substantially all the economic impacts created by these visitors are new impacts to the Scott County economy. The economic impacts of exporting services from the local economy rather than substituting one product for another within the economy will be discussed further in the economic impact section of this report. However, it is clear that the majority of overnight visitors to the Mystic Lake Hotel and the surrounding Enterprises of the Community are from outside of Scott County and are generating revenues for Scott County in the way of increased retail sales, eating and drinking establishment sales, hotel/motel sales, gasoline sales, and sales of other goods and services.