Smoky Mountain News

Harrah’s Cherokee Casino is cutting 100 jobs because of the national economic downturn.

The cuts represent about 5 percent of the casino’s approximately 1,800 employees. Harrah’s hopes to achieve the workforce reduction voluntarily, with the offer of a severance package spurring people to step up. But it will force layoffs if enough volunteers don’t materialize.

Darold Londo, general manager of the casino, said the softening economy with no apparent turnaround in sight has forced the casino’s hand.

“We continue to see fewer customers as they, like all consumers, are being prudent and cautious with their discretionary incomes,” Londo said. The casino’s gaming revenue has declined 4.4 percent over the past year.

This is the first time Harrah’s Cherokee has had to lay off employees in its 11-year history, Tribal Casino Gaming Enterprise Chairwoman Norma Moss noted. Moss said the employees are being offered a “fair and lucrative” severance package.

Employees were notified of the cuts Monday and told to come forward by Jan. 19 if they want to be part of the voluntary layoffs. The casino hopes the cuts will be made by the end of the month.

All of the casino’s profits are given to the Cherokee government. For the first time since the casino opened, that amount has gone down. In the 2007 fiscal year ending in September, $253 million was given to the tribe, compared to only $244 million for 2008, Moss said. Moss said the casino is trying to manage its operating costs to minimize the impact on the money distributed to the tribe.

Half of the profits go for tribal programs and the other half is distributed to the tribe’s approximately 13,500 members in the form of “per-capita” checks twice a year.

A $633 million expansion under way at the casino will not be impacted by the economic problems, Moss said.

“It will continue,” Moss said.

The expansion includes doubling the restaurants, hotel rooms, seating in the showroom and the gaming space, Moss said. The expansion will continue because the casino secured good financing and construction costs are affordable because of the lack of other construction work, Moss said.

Moss said the casino is excited about the expansion because when the economy rebounds Harrah’s Cherokee will be ahead of the competition.

Londo said as the economy improves he hopes that many employees can be rehired, and as phases of the expansion are completed additional employees will be needed.