WATERLOO - Tumbling revenues nationally have shown the gaming industry isn't recession-proof.

But the Isle Casino Hotel Waterloo managed to beat the odds during a successful sophomore year, realizing a 4 percent boost in gaming dollars over its first year of operation at the same time overall casino profits declined statewide.

"I'm obviously very pleased we've improved," said Don Hoth, president of the nonprofit Black Hawk County Gaming Association, which holds the gaming license for the Isle. "To show a slight increase in this economy means we've done very, very well.

"If you look at casinos across the country, some of them have even filed for bankruptcy," he added. "Las Vegas is doing real bad; you can get some really cheap rooms out there now."

Figures compiled by the Iowa Racing and Gaming Commission show the Waterloo casino had adjusted gross revenue of $79.8 million during the fiscal year ending June 30, 2009, up from the $76.6 million tallied during the 2008 fiscal year, which was the casino's first full year of operation.

The Isle was one of eight casinos in Iowa to post an increase in adjusted gross revenue, which is the amount of money wagered minus the winnings paid back to gamblers. The other nine casinos, not including American Indian facilities outside IRGC review, showed declining 2009 revenues.

"We're really comfortable with how we've progressed in the past two years," said Bari Richter, general manager of he Isle Casino Hotel Waterloo.

While she was pleased with the increase in adjusted gross revenue, Richter said that's not uncommon the newer casinos.

"We hadn't really matured yet," she said of the first year. "We're still working now on reaching our full potential."

The IRGC also showed the 1.54 million visitors to the casino in 2009 was about 200,000 fewer admissions than were tallied in the casino's inaugural year.

"That's not unusual," Richter noted. "When you first open a property you have a lot of people come in and look, just checking things out. You don't get as many tire kickers later on."

The Isle is currently working to expand the live entertainment offerings for guests and is making changes to Farradday's Steakhouse, the facility's upscale fine dining restaurant.

"The biggest challenge we've had is refocusing Farradday's so it works better in this market," Richter said. "This is a town where people want to be able to enjoy themselves and I need to make sure that restaurant is comfortable for people who come in there."

The financial health of the Isle is particularly important to city and county officials, who are now reliant upon gaming taxes to help balance annual budgets, and the Black Hawk County Gaming Association, which distributes 5.75 percent of the annual adjusted gross revenues as grants for local projects in Black Hawk and surrounding counties.

"We've benefitted tremendously - the cities and the county and even surrounding counties," said Waterloo Mayor Tim Hurley.

Before the casino opened, "the if-thens were all based upon $100 million (adjusted gross revenue)," Hurley said. "We haven't hit that, but it's certainly going in the right direction and we expect that trend to continue."

The city of Waterloo's general fund received just under $800,000 from the casino during the last fiscal year from a half percent host city tax and another half percent development agreement, which will grow to a full 1 percent in the coming year. Black Hawk County received about $400,000 from the host county tax.

Those dollars offset the need for additional property taxes or allow the local governments to continue providing services which otherwise would have been cut through property tax limits. The casino also paid $1.3 million in property taxes during the last fiscal year.

The state of Iowa received more than $15 million in gaming taxes from the adjusted gross revenue from the Isle. Another $1.6 million went to cover state regulatory costs and into a compulsive gambler's treatment fund.

But it was the $4.58 million the BHCGA receives as the license holder which may have the most visible local impact. The nonprofit agency's board makes quarterly grants from those dollars to capital projects, for property tax relief and for charitable purposes.

That revenue is expected to increase next year because the BHCGA paid off a $3 million advance from the Isle used to jump start downtown Waterloo projects - the Phelps Youth Pavilion, RiverLoop Expo and Sullivan Brothers Iowa Veterans Museum - before the casino opened.

"That Riverfront Renaissance was a long time coming," said Hoth. "I think a very successful My Waterloo Days showed the need for the Expo area."

Hoth was instrumental in spearheading a countywide referendum that authorized gambling and later joined former Robert Fulton and Jim Lind in forming the BHCGA to hold the license for the Isle. He's enjoying the fruits of that labor today.

"This is a lot of fun," he said. "(Board member) Jim Waterbury said handing out money is fun, but doing it wisely is a chore. That's all true, but our board has really come together and set aside parochialism."

Richter also found it gratifying to see some of the projects funded with gaming revenues being completed.

"The neat thing about the state of Iowa is that it has built into the structure that relationship with the not-for-profits," she said. "It's a great way for the casinos to work with the communities, improving the quality of life for all of us."