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Mass. Governor Rejects Casino Bill, Giving Foxwoods, Mohegan Sun A Reprieve

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Tuesday, 03 August 2010

Mass. Governor Rejects Casino Bill, Giving Foxwoods, Mohegan Sun A Reprieve By ERIC GERSHON August 3, 2010 A disagreement between Massachusetts Gov. Deval Patrick and the state's legislature over slot machine parlors could hand Connecticut's casinos yet another reprieve from formidable new competition in the Bay State. Foxwoods Resort Casino and Mohegan Sun have long cast a wary eye toward Massachusetts, where the state's top political leaders want casinos. But the governor and lawmakers there have never agreed on how to make it happen, and they appear to be stalled again this year. Failure in Massachusetts is success for Connecticut. Foxwoods and Mohegan Sun aren't talking about the situation in Massachusetts, but both casinos draw a large portion of their customers from the Bay State — as much as 36 percent in Foxwoods' case, according to estimates by the Center for Policy Analysis at the University of Massachusetts at Dartmouth. "I would suspect they hope that it all goes down in flames," said Clyde Barrow, director of the Center for Policy Analysis and an expert on gambling in New England. "At least another year of no competition from Mass.'" On Monday, two days after the Massachusetts legislature approved a bill authorizing three resort casinos plus two separate slot parlors at existing racetracks, the governor offered an amendment eliminating the slot parlors — potentially ending the dogfight until next year. Patrick opposes slots-only venues as less valuable economically than resort casinos, and says they invite greater social ills. He also portrays the bill's reservation of the slots-only licenses for racetracks as tantamount to a no-bid contract. House Speaker Robert DeLeo, who has two racetracks in his district, has been steadfast in his support of the slot parlors. But with the legislature now out of session until January and unlikely to reconvene for a special session, the bill appears likely to die unless Patrick changes his mind. It would be the second time in two years that Massachusetts has come close to expanding legal gambling, but halted on the brink. In 2008, the legislature, then under different leadership, killed a proposal by Patrick to authorize three resort casinos (and no slot parlors). The Mohegan Tribe, which has worked toward opening a casino in Massachusetts, if and when a bill is passed, declined to comment Monday. A spokesman called the situation "too fluid." The Mashantucket Pequots, who own Foxwoods, did not respond to a request for comment Monday. The executive director of the Connecticut Coalition for Gaming Jobs, a group recently formed to undermine casino development in states near Connecticut, did not respond. Any delay in competition also helps Connecticut's treasury, which receives 25 percent of the slot revenue at Foxwoods and Mohegan Sun — a total of $350 million in the fiscal year that ended June 30. Patrick had offered to support a bill providing for a single slot parlor, competitively bid and not restricted to a racetrack site, as an inducement to the legislature to act on other bills. But late Saturday night, legislators approved the three-casino, two-slot-parlor plan, anyway. Before the weekend was over, Patrick had said he wouldn't support it. "No one can reasonably dispute the fact that resort casinos generate far more jobs at better wages than slot parlors," he wrote to legislators Monday. Connecticut has no slots-only gambling venues. The Mohegans are better-positioned than the Pequots to counter the effects of expanded gaming in Massachusetts and potentially even capture new business from upstate New York. The tribe has laid the groundwork for opening a casino in the western Massachusetts town of Palmer, leasing land there and actively currying favor among local residents. Pequot leaders have said they are keeping their options open in Massachusetts, but their plans aren't as clearly defined or as developed as the Mohegans'. The Pequots have been struggling for years to open a casino in Philadelphia, and have more financial problems than the Mohegans. Under the Massachusetts legislation, casino developers would need to apply for and receive a license before proceeding. Winners of the three resort casino licenses would pay $85 million in licensing fees and would be required to make a capital investment of at least $600 million. Patrick had 10 days to respond to the legislature's bill, but acted on the first day that it reached his desk. Barrow, the UMass expert, said this allows Patrick time to "back down and sign the bill." Although Patrick has given no sign that he intends to do so, DeLeo and others are pressuring him by casting his amendment as essentially a veto — and one that inhibits job creation at a time of high unemployment. "By failing to sign this compromise gaming legislation or allowing it to become law, Gov. Patrick has decided to kill the prospects of 15,000 new jobs and immediate local aid revenue for cities and towns," DeLeo said in a statement issued late Monday afternoon. In submitting his proposed amendment to legislators Monday afternoon, Patrick indicated that Connecticut's casinos can eventually expect rivals in Massachusetts, even if it's later rather than sooner. "I believe that expanded gaming in Massachusetts, if done correctly, can be a successful part of our overall plan for job creation and long-term, sustainable economic growth," the governor wrote. http://www.courant.com/business/hc-mass-casinos-in-limbo-802-20100802%2C0%2C2015435.story

 

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