Tribes counter MGM, hinting at their bid for new casinos
The tribal owners of the Foxwoods Resorts and Mohegan Sun casinos sent legislative leaders a letter Wednesday asking for a chance to compete with MGM Resorts International’s proposal for a Bridgeport gambling resort if the legislature is intent next year on considering opening Connecticut to casino expansion.
The letter from Rodney Butler and Kevin Brown, the chairmen of the Mashantucket Pequot and Mohegan tribal nations, hints that they are less interested in open competition than in legislation similar to the bill passed in 2017: A law authorizing the tribes to jointly develop a casino in East Windsor to blunt the loss of business to an MGM resort opening in Springfield.
The tribes originally proposed that the state consider up to three gateway casinos to maintain or even grow its market share: one in the I-91 corridor of north-central Connecticut to compete with MGM Springfield, plus others off I-84 in the Danbury area and I-95 in Fairfield County.
“It was the Legislature’s decision to move forward with only one site in the north-central Hartford region. If circumstances have changed and there is now real interest in putting a casino in Bridgeport, we want to be a part of that discussion,” the tribal chairmen wrote Wednesday. “Over the past 30 years, many promises have been made to residents of the Park City. Few if any have come to fruition. We like so many others see the tremendous potential of Bridgeport and would love to be one of the catalysts that lead to a real revival.”
The 2017 law giving the tribes exclusive rights to a new casino in East Windsor was unique, a reflection of the state’s de facto partnership with the Pequots and Mohegans. In return for exclusive rights to casino gaming, the tribes pay Connecticut 25 percent of gross slots revenue.
States typically create competitive processes for casino licenses, such as the competition waged recently in Massachusetts for up to three casinos. MGM Springfield is to open next year, while Wynn Boston Harbor is under construction in Everett, Mass., and projected to open in June 2019. The Mohegans were among the competitors.
The East Windsor project is currently stalled in Washington. The Bureau of Indian Affairs has refused to approve or reject related amendments to the tribes’ gaming compacts with Connecticut. The state’s approval of the East Windsor project is contingent on the BIA essentially confirming that it would not jeopardize the current revenue sharing.
Connecticut and the tribes recently sued the Department of the Interior, of which the BIA is part, to force action on the amendments.
MGM announced a partnership with the owners of a waterfront parcel in Bridgeport in September to build a $650 million casino on the site. MGM says it could match or exceed the $265 million in slots revenue the tribes paid the state last year, a figure that has steadily dropped since its high of $430 million in 2007.
But MGM has another problem: If the state grants MGM or anyone else a casino license, the tribes say the exclusivity agreement is null and they would end the slots payments. In a state with chronic budget problems, the loss of more than $200 million in revenue would not be insignificant.
Rep. Joe Gresko, D-Stratford, said Tuesday night he happily would co-sponsor a bill opening competition for a casino in neighboring Bridgeport, but he also would want MGM to explain how the state would be protected against loss during construction of a new resort.
Gresko was among the legislators in the audience Tuesday night to hear a speech to the Bridgeport Regional Business Council by James Murren, the Bridgeport-born chairman and chief executive of MGM.
Murren said the state’s exclusivity deal with the tribes is outmoded, and Connecticut needs to expand gaming if it is to retain gambling revenues and jobs in the face of competition from New York, Rhode Island and Massachusetts.
Legislative leaders reacted cautiously.
House Minority Leader Themis Klarides, R-Derby, said the legislature is focused on how to close a deficit that’s already opened in the recently adopted budget.
Senate President Martin M. Looney, D-New Haven, and Senate Majority Leader Bob Duff, D-Norwalk, said they were wary of anything that would undermine the workforce at Foxwoods and Mohegan Sun.
Duff said a casino in Bridgeport clearly would take away market share and jobs at those casinos.
“I for one, as much as I supported the bill to allow a third location and supported the 6,000 job that are in the state in that industry, I do not support a casino in Bridgeport. I never have,” Duff said.
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