Connecticut Governor Dannel Malloy last week signed Public Act 17-89 authorizing the state’s two gaming tribes to build a third casino—this one off tribal land. He signed the bill three weeks after the legislature approved it. Meanwhile MGM International is poised the challenge the action in federal court.
In his signing statement the governor note: “Over the years, our state has maintained a longstanding partnership and compact with the Mohegan and Mashantucket Pequot tribal nations, who employ thousands of Connecticut residents at their casinos.”
The tribes had produced studies that showed that failing to take an effort to blunt the effects of the MGM Springfield now rising 14 miles across the Massachusetts border could cause the loss of thousands of jobs from the Foxwoods Resort Casino and the Mohegan Sun.
They proposed a $300 million, 200,000 square foot casino with 2,000 slots and up to 150 gaming tables.
Mohegan Chairman Kevin Brown hailed the signing. “With a stroke of the pen, we are that much closer to turning our proposal for an entertainment and gaming facility in East Windsor into reality,” he said. “We’re excited about the future, and tremendously thankful for the leadership of the governor and the many legislators from both parties who rallied to protect jobs in our state that would otherwise have been lost.”
Mashantucket Pequot Chairman Rodney Brown had said previously that once the bill is approved the tribes could obtain regulatory approvals within six months, and be open 18 months later.
The tribes, through their joint MMCT Venture, would pay $1 million to cover the costs of regulating the casino. Once operational, the casino would pay the state 25 percent of gross gaming revenue. It would pay the host town of East Windsor $8.5 million annually, plus a one-time payment of $3 million. It would also pay $750,000 a year to each of the six communities that surround East Windsor, which include East Hartford, Ellington, Enfield, Hartford, South Windsor and Windsor Locks.
MGM Resorts International had appeared to be waiting for Malloy to sign the bill. Now that the shoe has dropped MGM appears likely to file a lawsuit challenging it.
MGM says the status of its first lawsuit, which has been ruled against by a lower federal court and then in the 2nd U.S. Circuit Court of Appeals in Manhattan, is irrelevant.
The appeals court ruling came last week, upholding the earlier dismissal of the lawsuit.
The new lawsuit would claim that MGM was placed at a competitive disadvantage because of the special path to getting a license that was created by the legislation for the Mohegan and Pequot tribes to build off their reservations in East Windsor in the closed Showcase Cinema.
Meanwhile Springfield Mayor Domenic Sarno told reporters had had every confidence in the success of the $950 million MGM Springfield, and then called the proposed casino in East Windsor—which would be 14 miles away— a “glorified slots parlor.”
MGM has so far spared no expense to fight the third casino—which it regards as a dagger aimed at the heart of its casino—which the Connecticut tribes regard as a dagger aimed at the hearts of their two casinos. It has taken to the courts and to the halls of the state capitol to try to derail the bill.
Some legal authorities believe that the reason MGM’s first lawsuit was tossed out is because it was filed before the legislature did anything other than give the tribes the authority to identify a site for the casino. Now that the casino has actually been authorized, these experts expect that MGM will have a stronger case.
The appeals justices in their written opinion left open this possibility: “Our conclusion does not rule out the possibility that MGM’s alleged harm may at some future point become sufficiently imminent.”
Western New England University Constitutional Law Professor Arthur Wolf, interviewed by 22News, commented that MGM will rely on the Commerce Clause of the Constitution and the Equal Protection Clause of the 14th Amendment. “The 2nd round they will [have a better chance] because the 2nd round with legislation now pending before the Governor of Connecticut would give the tribes the exclusive right to develop a casino off tribal lands.”
Wolf added, “The key thing here would be the probability of success and you have the Attorney General of Connecticut already saying there may be a substantial claim by MGM, that alone may be able to satisfy the element of probability of success.”
MGM spokesman and general counsel Uri Clinton declared in a statement, “We view today’s ruling as nothing more than a matter of timing and remain undeterred in our goal of having the opportunity to compete in Connecticut.”
Sarno added, “The reality is that there’s only one transaction to have in the state of Connecticut and that is with the tribal nations.”
According to the Office of State Ethics, MGM spent $1.68 in its combined efforts. MMCT Venture spent $574,659, while each tribe also spent: The Mohegan Tribal Gaming Authority spent $76,800 and the Foxwoods Resort Casino spent $21,987.
The Schaghticoke Tribal Nation, which is an ally of MGM in trying to get a casino license opened to commercial bids, spent $31,717.
