Connecticut Tribes Settles on East Windsor for Casino

MMCT Ventures, the partnership of Connecticut’s two gaming tribes, has chosen East Windsor, and a former cinema complex, as the site for their proposed third, satellite Indian casino. They still need to convince the legislature to give the go ahead, and the governor has asked state Attorney General George Jepsen (l.) about the constitutionality of the plan.

MMCT Ventures, which represents Connecticut’s two gaming tribes, the Mohegans and Pequots, announced last week they had settled upon East Windsor near the border of Massachusetts as the location for a border casino to challenge the MGM Springfield and, they hope, prevent it from siphoning a killing number of customers from the tribe’s two main casinos, Foxwoods and the Mohegan Sun.

The site they have chosen sits along Interstate 91, and was once a cinema complex, the Showcase Cinemas. The casino, if built, would be jointly operated by the tribes under the MMCT mantle. It would have 2,000 slot machines and 150 gaming tables.

An agreement between the tribes and the East Windsor Board of Selectmen was later in the week approved by the board 4-0 at a special meeting.

First Selectman Robert Maynard said the casino would be a win, win for state, region and city: “I think this really will open up a lot of possibilities for the entire north-central area.” He added, “It’s right in our commercial corridor—it’s just what we want to see there.”

James Richards, chairman of the East Windsor Chamber of Commerce, told the Hartford Business Journal, “We think it’s a great opportunity for the town to use this as a cornerstone for” development in the Warehouse Point area.

In a statement MGM called the casino plan a “terrible deal for taxpayers in East Windsor and the state of Connecticut. The only way Connecticut opens its first commercial casino in a way that benefits the entire state is by scrapping this charade and creating a fair, open, transparent, and competitive process.”

The tribes formed MMCT more than a year ago to find a location to site a medium-sized $300 million satellite casino to interrupt some of the effects the $950 MGM Springfield could have on their existing operations when it opens in 2018. They contend the state has a stake in this since they project losses of thousands of jobs and millions of dollars of tax revenue from the competition.

A study the tribes paid for projected that a $300 million casino would generate $301 million in gross revenue and create 2,000 jobs. Without it, the study said the state would lose about 9,300 jobs.

The tribes have decided—but that doesn’t mean the legislature will go along. Already some lawmakers are talking about simply throwing out the process by which the tribes chose the site for their third, satellite casino, and instead locating a third casino in the southwestern part of the state to make a play for the New York market.

Rep. Christopher Rosario told the Associated Press: “I think building a third casino in northern Connecticut, I just think it’s shortsighted.”

He has authored a bill that would authorized new commercial casinos in the state, taxed at 25 percent on slots revenues. Rosario, who represents the Bridgeport area, is being joined by other legislators from that region in supporting putting a casino in the state’s largest city. This is not a new idea; Bridgeport has been the focus for casino proposals before. “You get a bigger bang for your buck, not only for the region but for the state if you put it in southwestern Connecticut,” Rosario said.

Several weeks ago, MMCT announced the two finalists: East Windsor and Windsor Locks. Last week they let the East Windsor Board of Selectmen to take the lead in announcing a development agreement with the tribes. They will pay the city $3 million up front and $3 million each year. The city will also be able to tax the casino, for an estimated $5.5 million annually. The tribes will also pay the state 25 percent of all gaming revenues.

Rodney Butler, chairman of the Mashantucket Pequot Tribal Nation declared, “From the beginning, we’ve said that we want to site our new facility in a town that’s eager to have us. With the unanimous vote by the Board of Selectmen, East Windsor fits that bill, and we’re thrilled to enter into partnership with them.”

Now that the tribes have proposed, it’s up to the legislature to dispose. The political picture is murky. No one knows if the tribes have the clout to force action by the end of the legislative session in June.

Although most of MGM’s obvious efforts to block the casino has been in the courts, it has also spent considerable money on lobbyists to convince lawmakers that the state might make more taxes by redirecting casino efforts to Fairfield County. The tribes currently pay 25 percent of their casino revenues in return for a monopoly on gaming in the state. These lawmakers are obviously weighing whether the state could make out better by busting that monopoly.

Two years ago, Connecticut collected almost $268 million from tribal gaming, down from $430.5 million ten years ago. That would disappear entirely if the tribe’s exclusivity guarantee ends.

Yet some question whether the exclusivity promised by the compact isn’t compromised by allowing the tribes to build on non-reservation land. Speaking at a legislative hearing of the Public Safety Committee last week tribal leaders tried to calm that fear.

They cited an April 2016 letter from the Bureau of Indian Affairs that offered the opinion that giving the tribes exclusivity on non-tribal land did not violate the compact. The BIA added a caveat that the “letter should not be construed as, a preliminary decisions or advisory opinions regarding compacts that are not formally submitted to the Department for review and approval.” Mohegan Tribal Chairman Kevin Brown promised the lawmakers that the tribes would ask for a formal opinion from the BIA—once the legislature approves the plan. He asked rhetorically, “Do we want to do nothing as a state?” to combat the MGM Springfield. He noted that tribal casinos have paid over $7 billion to the state over the last two decades.

Brown was forced to defend the fact that the Mohegans competed against MGM and other developers to build a casino in the Bay State. “When we were competing for the customers in Massachusetts and building a business model for Massachusetts, we were doing it in a way that would preserve our business here. Why would we go to Massachusetts to build a casino that would cause our casino in Connecticut to fail?”

Nevertheless, some lawmakers are listening to MGM’s Uri Clinton, a senior vice president and deputy general counsel, who testified: “We think the place to build in Connecticut is the southwest. The state of Connecticut has a market where the casino license could be highly valuable because of the proximity to the New York market.” Generally unstated, but understood, is that MGM wouldn’t be able to build in the Hartford area itself because that would violate its agreement with Massachusetts not to compete against its own casino.

Clinton advised lawmakers to reconsider the monopoly they have given the tribes. He said the state could be tossing away an opportunity. “These opportunities are very rare and very valuable,” he said. “The choice was either do something that we want you do to do or do nothing. I actually say the choice is different.”

 He reminded them Attorney General George Jepsen had previously warned that a non-competitive contract with the tribes could open the state to a lawsuit.

The tribes said they couldn’t guarantee to pay the legal bills if such a lawsuit transpired.

Other speakers supported MGM that building a casino in the southwest made more business sense than building one right at the border. They included Chief Richard Velky of the 300-member Schaghticoke Tribe, Charlie Aspinwall of the Golden Hill Paugussett Tribe, and the president of the state’s parimutuel wagering system.

Velky said his tribe was eager to develop a commercial casino there or in the west. He considers Bridgeport a better market to develop. He said that so far his tribe has been shut out of any of the economic opportunities associated with gaming.

Aspinwall seconded that. “Bridgeport is an ideal location,” he said.

Ted Taylor, president of Sportech Ventures, which plans to open a pari-mutuel center at Stamford in a few months, said that a tribal casino in East Windsor or Windsor Locks would be “devastating” for his business. “You are considering a new gaming industry,” Taylor said. “This cannot be seen as an extension of what you already have. We want to be part of the discussion.”

And Silver Lane Partners’ Anthony W. Ravosa, whose East Hartford proposal was dropped from the running, argued that it remains the best option for serving the larger Hartford area.

Rep. Joe Verrengia, D-West Hartford, co-chairman of the remarked after the hearing was over: “I think the pressing issue going forward is do we open it up to a competitive process and gauge the interest, or do we exclusively deal with the tribes?”

The other co-chairman Senator Timothy D. Larson, said he supported the tribes. “In my view, we have a longstanding history with the two [tribes], and I think they are making an historic and very bold step to benefit the state of Connecticut.”

A group that was pointedly not invited to testify to the committee was left fuming, mainly in impotent frustration. Michele Mudrick, executive director of the Coalition Against Casino Expansion in Connecticut, declared, “By excluding the public, the committee is providing a totally biased view of the benefits of casino expansion and depriving committee members of the opportunity to question opponents and gain critical information that they would not otherwise hear.”

Verrengia defended the make-up of the invited “stakeholders.” He told the Hartford Courant, “There’s been heavy lobbying going on behind the scenes,” Verrengia said. “Rather than have those closed-door discussions, I thought it would behoove the committee to have this open and transparent process.”

Senator Tony Guglielmo, co-chairman of the Public Safety and Security Committee, which oversees gaming, said he opposes the plan, although he admitted to being in the minority. “I’m not going to vote for it,” he said. “I don’t think we need a third casino. I just don’t think that’s the way you rebuild Connecticut’s economy, more gaming.” He questioned the legality of the tribal monopoly. “How can that possibly be constitutional?” he said.

“We’re going to bring forth two bills,” said Verrengia, “It’s the two sides of the issue.”

Meanwhile, in Springfield, city officials are sweating over the possibility that the tribes might cut into “their” market, although the tribes would retort that they are trying to preserve their own market.

Whosever market it is, Springfield is just 14 miles from East Windsor. Massachusetts Rep. Bud Williams told the Boston Herald, “Obviously, we would rather not have it, but they are intent to take customers from our market,” adding, “It’s very troubling. This has been on the back of my mind as a legislator, because the casino here was built based on a certain market.”

Williams added, “It appears that there is a unified front right now in Connecticut. I don’t like it. It makes me kind of nervous.”

Springfield Mayor Domenic J. Sarno, who worked tirelessly to bring a casino to the city, doesn’t share that worry. In a statement, he said, “Unlike other gaming establishments which have the ‘in the box’ mentality, this again is a very creative ‘out of the box’ development and not a glorified slots parlor,” he said. “I’m confident in MGM and I’m confident in the first-class product that they’re putting forth.”

Sarno conceded that he was comparing the proposed tribal casino to a “glorified slots parlor.”

Council President Orlando Ramos has faith in the MGM brand. He told the Herald, “MGM is a recognizable name with a long history, and history shows that they have been successful. I am not too concerned. I think the MGM Springfield project is unique and it will attract people regardless of whether there’s competition.”

Windsor Locks officials were disappointed at not being selected. Windsor Locks First Selectman Christopher Kervick said he felt the tribe passed them by because support from town officials wasn’t unanimous. “and they particularly mentioned members of the Finance Board. I would have preferred that our residents had a chance to be heard, but since the partisanship scared them off, now they won’t get that opportunity,” he told the Hartford Business Journal.

Despite the loss, Kervick said his town might go ahead and schedule a referendum to combat the impression that a casino is unpopular. “There is a growing sentiment that Windsor Locks still proceed with a referendum, and I think it makes sense,” he said. “in case East Windsor falls through or if the legislature requires a referendum. It would give us a leg up.”

MMCT spokesman Andrew Doba didn’t hold out much hope for that eventuality. He said East Windsor is the final choice.

MMCT estimates that a new casino would create about 1,700 temporary construction jobs and roughly the same number of permanent jobs—most of them fulltime.