Eastern Connecticut’s two gaming tribes are not yet ready to name a site for the state’s third Indian “satellite” casino, but they are near to “more intensive negotiations.” The purpose of the casino is to blunt the effect of the MGM Springfield that is being built just 26 miles from Hartford with a 2018 expected opening just across the border in Massachusetts.
In a joint statement Tribal Chairmen Kevin Brown and Rodney Butler announced, “We don’t yet have a site picked, but we are getting to the point where more intensive negotiations with the remaining sites should begin. Our goal is to make sure we get this right, which is why we’re taking the time necessary to make the right decisions.”
Mashantucket Pequot Tribal Chairman Rodney Butler announced last week that both tribes planned to work with legislative leaders during this year’s session to address their concerns. Some lawmakers worry that a third casino might adversely impact the existing revenue sharing agreement between the tribes and the state.
Butler said, “Given we still have work to do on site selection, our focus for this legislative session is to work with state leaders to address some of the concerns raised by the attorney general, and others. We also want to make sure that we protect the revenue our facilities provide to the state.”
Special Act 15-7 passed by the General Assembly (Connecticut’s name for its legislature) requires that the tribes return to the lawmakers once they have chosen a site. The 2016 legislative session runs until May 4.
The tribes claim they have paid $7 billion in taxes to the state over the last two decades they have operated competing casinos. The hit that the MGM Springfield alone would have on those casinos has been estimated at $702 million, as well as 9,300 jobs that would be affected.
The two erstwhile rivals formed a joint venture, MMCT, which will negotiate with the potential host communities and will operate the satellite casino. MMCT originally said it would choose a site by December 15. However, the potential host communities requested more time to put together their proposals and possibly schedule referendums.
So far sites in East Hartford, East Windsor, Hartford and Windsor Locks have been identified as possible casino locations. All are near Hartford and the border with Massachusetts.
Not everyone is on board with the need for a third casino. Danbury Mayor Mark Boughton told the Connecticut Post last week, “I’m not quite sure what the rush is. I think the better approach is to take a step back and do an economic impact study. They’re trying to hedge the casino that’s going in Springfield. It’s like you’re playing with a game board with the game of Risk.”
A new, and embarrassing (for the state) wrinkle has entered into this process with the state’s accidental approval of the Schaghticoke Tribal Nation’s application to have a “tribal business entity” that would be able to compete for a casino in the state. The Secretary of State’s office mistakenly approved of the application, believing it to be only for a normal LLC, not the type of tribal “entity” envisioned as operating an Indian casino.
Immediately the tribe went into celebration mode, issuing a statement that began, “We view this as a significant economic development opportunity. Our objective will be to maximize economic opportunity for the residents of Connecticut, and to maximize revenue gained by the state of Connecticut.”
When it realized its mistake, the Secretary of State’s office quickly withdrew the approval, but the tribe has decided to take advantage of the error and run with it. Secretary of State Denise Merrill announced the error on February 3. Merrill said that the tribe’s application entitled it to create an LLC, but did not meet the requirements of Special Act 15-7 approved by the legislature in 2015. The Act named the Mohegan and Pequot tribes as being allowed to build off-reservation casinos. It used the term “tribal business entity,” in describing who could build the casino.
Merrill’s statement said, “The Special Act created a unique situation that raised the bar for review.” She added, “In this case, it looks like the application was received in error. In 99.99 percent of the cases, we have to receive and file an LLC application without regard to the stated purpose of the entity. Anyone can start a business and we believe it should be easy to do. It appears in this case that the application meets the standard to create an LLC, but not the requirements of the Special Act. We are looking into what additional action should be taken.”
Chief Richard Velky, noting that Merrill’s office has not rescinded the registration, issued a statement saying that his tribe would be moving forward with building a casino. “Our application clearly stated that our intent in registering a business entity was to be granted permission to build a commercial casino in Connecticut pursuant to Special Act 15-7,” said the chief’s statement.
Velky added, “I can only assume that means the Secretary of the State’s Office understands that it is wandering into dangerous legal territory if in fact it tries to rescind a perfectly valid, legal application that it initially approved. We abided by the law, filed a complete, detailed application to develop a commercial casino in Connecticut, and our application for a business entity under Special Act 15-7 was approved. We are ready to move forward.”
Unlike the Mohegan and Pequot tribes, the Kent-based tribe has never achieved federal recognition. In 2004 the Bureau of Indian Affairs granted it sovereignty, but later reversed the decision under extreme pressure from the state and its Congressional delegation.
The town of Kent has long fought the federal recognition of the Schaghticoke tribe, which has two factions that each claim to be the legitimate tribe. Once before the tribe has sought to build a casino, in Bridgeport, or a bingo parlor on its reservation.
The town’s First Selectman Bruce Adams put to rest any nation that his community has changed its mind on that score. He told the Connecticut Post: “The town of Kent does not have any interest in such a possibility.”
Connecticut’s U.S. Senator Richard Blumenthal released a statement last week that said, “The Schaghticokes are not federally recognized and therefore do not have authority to pursue a casino under federal law.” He added, “Their reliance on Special Act 15-7 seems misplaced as that state legislative act limits the operation of the third casino to a business entity controlled by the two federally recognized tribes in Connecticut — the Mashantuckets and the Mohegans.”
Meanwhile MGM Resorts International is continuing with its lawsuit against the state over Special Act 15-7, which it claims violates the U.S. Constitution’s equal protection clause. Leading MGM’s legal team is former U.S. Attorney General Eric Holder. The lawsuit was filed in August.
MGM’s lawsuit recognizes what the tribes have been explicit about: that their third casino is aimed at MGM.
Brown made that clear recently when he declared, “This process began to preserve thousands of jobs and millions in revenue which will leave (Connecticut), the loss of which MGM has repeatedly acknowledged is necessary to make their project in Springfield a success. As members of communities with deep ties to this state, we’re simply not going to let that happen without a fight. With this phase complete, we can now begin to engage interested parties and save Connecticut jobs.”
