Frustrated that the Bureau of Indian Affairs has so far declined to certify that their amended tribal state gaming compact with the state of Connecticut meets the standards of the Indian Gaming Regulatory Act, the Mohegan and Pequot tribes and the administration of Governor Dannel P. Malloy have gone to Federal District Court to try to force the BIA to act.
The tribes, and their joint authority MMCT Venture, need that approval before they can break ground on the third satellite casino, a commercial casino that would complement their existing Foxwoods and Mohegan Sun casinos, but, because it would be located in East Windsor near the Massachusetts state line, would blunt some of the effects of the $960 million MGM Springfield, 14 miles away, when it opens next fall.
The new casino would reportedly be named the Mohegan Sun Foxwoods East Windsor. It would be located near Interstate 91 in a town that is a suburb of the state capital, Hartford. Without such a casino, the tribes have estimated that they could lose $100 million a year.
The legislature in July approved of the satellite casino, but stipulated that the BIA’s blessing on the compact was needed. Lawmakers felt that cover was necessary because the compacts in the past have guaranteed that the tribes pay 25 percent of their gaming profits to the state in return for a monopoly on gaming. The worry is that by allowing the tribes to open a commercial, non-tribal casino, that they would in effect break the compact by competing against themselves.
The tribes and the state want the BIA to approve of the changes to the compact. So far, after four months, it has not acted. According to the Indian Gaming Regulatory Act, the agency has 45 days to act on a compact’s submission.
Governor Malloy issued this statement to accompany the lawsuit: “The state of Connecticut over the years has maintained a long-standing partnership and compact with the Mohegan [Tribe] and Mashantucket Pequot Tribal Nation and they employ thousands of Connecticut residents at their casinos. State law requires that these compact amendments are in fact approved. That’s why I have asked the attorney general to file this action. We need clarity and certainty with respect to this issue.”
State Senator Cathy Osten, whose district includes East Windsor, praised the action. “This is good news for eastern Connecticut, because there are more than 10,000 jobs in the region hanging in the balance with this federal decision,” she said. “We passed a bipartisan bill nearly six months ago to defend ourselves against an outside effort to destroy jobs and decimate one of the most important industries in our state. The federal government is now long past its deadline to act on the agreements that the representatives of the people of Connecticut have deemed vital to the health and prosperity of our state. I applaud the governor and tribes for their action today on behalf of the people of Connecticut and our best interests.”
Interestingly, while the tribes and the state were working on the changes to the compact, they were in consultation with the Department of the Interior, which provided advice and technical assistance. But then once the amendment was submitted, the agency returned the amendments without taking any action.
Meanwhile, MGM Resorts International, which has maintained an aggressive and steady war against the tribal casino, has continued to press on its own proposal to build a $675 million commercial casino in Bridgeport, which MGM first floated three months ago. The state’s largest city is poised next to the New York state line, and would thus be able to tap into that market.
Obviously, if the tribes opening a commercial casino could potentially break the exclusivity clause of the tribal state gaming compacts, a Bridgeport commercial casino certainly would break it into pieces. But Uri Clinton, MGM’s spokesman during the controversy, argues that the state would actually make more money by allowing it to happen.
MGM’s point is that the two tribal casinos are in a declining glide path, with ever smaller profits. In 2007 the combined revenues from the two tribes were $430 million. Last year they were $265 million.
Clinton also disputes the tribes’ claims that the BIA’s failure to act on the compact means that it is “deemed approved,” according to the wording of IGRA. “No lawsuit, not even one backed by the Governor” would change the facts of the case.
Clinton told the Connecticut Post “We stand by the Bridgeport project and our analysis of where we are in the casino discussion in Connecticut.”
At a recent speech given to the Bridgeport Regional Business Council, an audience of about 375, James Murren, MGM chief executive officer, asked for help in lobbying the legislature to support a Bridgeport casino. He said it would provide the city’s waterfront with a “life-changing opportunity.” Adding, “This could be one of my crowning achievements.”
The meeting was attended by local lawmakers and the mayors of Bridgeport and New Haven, as well as the property owner of the site where MGM wants to build.
MGM proposes a casino with 2,000 slots, 160 gaming tables, a 300-room hotel, a 700-seat concert venue, dining and retail.
Mirren, who is a native of Bridgeport, predicted that unless Connecticut acts in a timely manner that it will lose revenue to casinos that will be opening soon in New York.
“There will be table games, I think, in Queens, in Yonkers and maybe a third New York City location, certainly within the next four years, if not sooner,” he said. “The question for Connecticut becomes what do we do with this information that we have? Casinos are opening up in Massachusetts. They’ve expanded in Rhode Island. Table games are coming to New York. What does Connecticut do about that? They can wish it away and hope it doesn’t happen, which is not logical. Or it could address this.”
Mirren added, “What would it do for the state if the state of Connecticut would modernize its gaming profile? That is a question you should all ask yourselves. If the state of Connecticut concludes that it wants to participate in commercial gaming, which was the conclusion in Hartford, wouldn’t you want to do it in a state-of-the-art way?”
The tribes’ reaction to MGM’s latest moves has been to release a digital ad that quoted a recent comment Mirren made in a conference call in which he declared that the MGM Springfield would be the company’s latest major development.
The ad says, “Connecticut isn’t getting an MGM casino. Connecticut’s getting played.”
Mirren says he was talking about the company’s expansion into states where commercial gaming is legal, and wasn’t referring to states like Connecticut where new legislation would be needed. MGM is also trying to convince the Georgia legislature to legalize gaming, he said.
In his speech Mirren, while not referring to the ad, declared, “I’ve made a lot of promises in my career at MGM, promises to the city of Detroit, which I’ve kept for over a decade, and promises in Maryland, which I’ve kept.” He added, “I’ve made promises to the city of Springfield, which I am keeping, and I want to make promises to you and everyone in the state of Connecticut, which I intend to keep.”
The next day the tribes tried to outmaneuver MGM on the lobbying front by sending a letter to the governor and the legislature asking to be part of any discussion to expand gaming, particularly in Bridgeport.
