Despite a recent decision by the federal government to put land in Taunton into trust for the Mashpee Wampanoag tribe of Martha’s Vineyard, the developer of a rival casino proposal in Brockton predicts that the Indian casino faces obstacles that will keep it from being built for years.
That is the reason Rush Street Gaming gives for not giving up on its commercial proposal for the southeastern casino zone (Region C), despite the federal ruling that would seem to make the Mashpees’ First Light Casino an inevitability.
In a statement issued last week, Mass Gaming and Entertainment declared, “While it is likely that the Department of Interior’s decision will be challenged and litigated for years, our proposal will bring needed revenues, jobs and economic development to Brockton and the Commonwealth. We believe the Gaming Commission should continue with the Region C licensing process.”
The gaming expansion act of 2011 called for two commercial casinos, one slots parlor, and one license in the southeastern zone set aside for a federally recognized tribe, almost universally assumed to be the Mashpees, but only if the tribe met several conditions. The last of these, putting land in trust, turned out to be the sticking point because it took so long. So long, in fact, that the Massachusetts Gaming Commission finally opened the process up to commercial bidders, a necessity that was also provided for in the legislation.
The only developer left standing in that process is Mass Gaming and Entertainment and its Brockton casino proposal. All the others were driven away by financial backers too skittish to play in an environment where the Mashpees might get federal recognition and compete without paying any state taxes, while a commercial casino would have to pay 25 percent of its profits. Without a commercial casino the tribal state gaming compact obligates the tribe to pay 17 percent.
Nevertheless Rush Street Gaming, which is the principal of Mass Gaming, insists that the numbers indicate a Brockton casino will make money whether or not the Taunton casino is built. It cites a study projecting $400 million annually without the tribal casino and more than $300 million with it. The same study predicts a 10 percent hit in Wynn’s casino and a 15 percent cut in slot parlor revenue.
Mass Gaming declared, “We believe based on experience and significant market research that a casino in Brockton would be successful even with a tribal casino in Taunton. We would not be applying for the Region C license and committing our own significant funds if we were not confident in this project.” The two casinos would be 30 minutes apart.
So far the commission has resisted blandishments by Mass Gaming that it issue a license, and has not committed to issuing any commercial license before spring. But it did reaffirm the commission’s right to issue a license even if the Mashpees move forward. The tribe can build its casino without interference from the commission.
Bluhm’s supporters warm that a wrong move by the commission could lead to no casino at all for the region. That could happen, say, if the commission rejects the Brockton casino and the tribe is unable to build. That would deprive the region, they say, of jobs, tax revenue and the attendant economic growth.
The commission has always known that the Mashpee decision was a distinct possibility. Crosby said, “We knew it was coming, might be coming, any time.”
Mass Gaming, which consists of Neil Bluhm and George Carney, owner of the Brockton fairgrounds, met the September 30 deadline to submit its final application for a $650 million casino on the fairgrounds. That simplified things for the commission, whose chairman had previously said, “We will wait to see whether or not we have a qualified applicant.” The commission last week said that it wouldn’t make a decision on the Brockton project until the spring of 2016 and reserved the right not to issue a license.
During last week’s meeting Crosby emphasized that the commission has followed a set schedule for all other license applications and plans to follow the same timetable. “It’s our view that the legislation does give us the authority to award a commercial license,” he added.
Commissioner James McHugh said he wants to consider the effect on state tax revenues of both casinos operating.
This unanimous decision to not make a decision yet dashed Mass Gaming’s hopes to pry a guarantee out of the commission that it would issue a license soon, or not at all.
Governor Baker Charlie Baker said last week that he supports whatever decision the commission makes. He told reporters, “My basic position on the casino stuff generally is the Gaming Commission, by virtue of the statute that was written by the Legislature, was deemed the overseer and decision maker with respect to casinos in Massachusetts and casino gambling in particular and I believe the market will ultimately decide what works and what doesn’t here.”
The Mashpees’ four-year efforts to put land into trust paid off. But then the tribe has had to learn patience during its four centuries of interaction with the white race.
Mashpee Chairman Cedric Cromwell acknowledge this reality when, upon hearing of the federal decision, he said, “History has come full-circle. This is truly a glorious, monumental day – a day many of our people, both living and deceased, have spent their entire lives working to establish.”
He added, “We have occupied this land for the past 12,000 years. But, over the past four centuries, much of our ancestral home was taken away from us. Our land-into-trust application did not seek to reclaim the entirety of our ancient homeland, which included the eastern part of Massachusetts from Gloucester Bay all the way to Narragansett, Rhode Island. However, we now have a sovereign base from which we can work to sustain our cultural traditions, develop a thriving tribal economy, and serve the needs of our people as we see fit.”
The Bureau of Indian Affairs put 170 acres of land on Cape Cod and 151 acres in Taunton in federal trust.
Said Cromwell, “While some outside the Tribe will focus only on our quest to build a destination resort casino in Taunton in accordance with the federal Indian Gaming Regulatory Act, for us this goes far beyond economic development. This is about controlling our own destiny and preserving our ancient culture.”
Another Party Heard From
While there is no one else in the southeastern region, that doesn’t mean that there is no interest at all in another racino.
Ironically the same casino developers who united to fight an attempt by opponents of gaming to repeal the gaming expansion act of 2011, are united again in their opposition to a late entry seeking a seat at the table.
These developers, including Wynn Resorts, Penn National Gaming and MGM Resorts raised over $14 million, according to a report in the Boston Globe. Their efforts defeated the referendum easily, by a margin of 60-40 percent. Wynn has started work on a $1.7 billion casino resort in Everett; Penn National recently opened the Plainridge Park slots parlor in Plainville and MGM has started work on its MGM Springfield.
Their target this time is a Thai developer, Eugene McCain, who has an option to purchase a trailer park near the Suffolk Downs racetrack in Revere. He is attempting to qualify a ballot initiative that would allow the state’s second slots parlor (the first is in Plainville). Suffolk Downs last year was the site of an unsuccessful bid for the Boston metro casino license.
The successful developers were quick to line up last week to attack the proposal of the Johnny-come-lately.
MGM Spokesman Carole Brennan declared, “MGM was thoughtful and deliberative in its decision to enter the Massachusetts market.” She added: “It relied on the 2011 law that established the framework for a license and capped the number of gaming facilities. Any amendment to this carefully crafted law, which took into account the market forces in the northeast, or ballot measure would alter the gaming landscape across the state and negatively impact all licensees.”
Wynn has not made any public comments, but in September joined Penn National in filing papers with the Attorney General’s office challenging the legality of the initiative. Attorney General Maura Healey ruled that the proponent could gather signatures. However, McCain would have to collect 65,000 signatures by early December to make it onto the ballot.
Meanwhile the owners of Suffolk Downs deny any connection with McCain’s effort. CEO Chip Tuttle issued the following statement: “We have been clear that Suffolk Downs has nothing to do with this ballot question and that we will not support it. I don’t foresee any circumstances under which that would change.
Wynn Everett
A Boston Superior Court judge last week listened to over two hours of arguments from several cities suing the Massachusetts Gaming Commission to overturn its awarding of the Boston metro license to Steve Wynn’s $1.7 billion project in Everett.
Besides Boston, Revere and Somerville, the Mohegan Sun, which sought to build a casino resort at Suffolk Downs are suing the commission. The all seek to have the decision-making process reset.
The commission argued last week: “the complaints should be dismissed because gambling license decisions are not subject to court review under state law, something casino applicants are well aware of when they apply.”
An attorney for the Mohegan Sun said they are not challenging the decision itself, but the process that led up to it.
Meanwhile, the most vocal antagonists in this contest, Boston Mayor Marty Walsh and Steve Wynn himself, appear to be moving crablike towards talking to each other.
Adrian Walker of the Boston Globe last week suggested a reason for this: “Maybe Walsh is finally coming to his senses about his slim chance of blocking the casino Wynn is poised to build in Everett.”
The judge in the case, Janet Sanders, appeared to hint broadly that the city’s case is weak and that the decision has been made by the gaming commission and said she was not sure whether the court should “wade into” a matter that the law clearly states is the commission’s decision to make.
Last week the mayor quietly met with several representatives of the gaming mogul. The meeting followed on the heels of a telephone talk between Wynn and Walsh in which the two adversaries deliberately stayed away from the more controversial issues and concentrated on what they might do to mitigate the effects of the casino on traffic in Sullivan Square in the Boston neighborhood of Charlestown, across the Mystic River from Everett.
“It’s a common problem that the Wynn folks have and that the people of Boston have,” Walsh told the Globe.
Both sides issued hopeful statements.
“Mayor Walsh is exploring all options to resolve this matter on behalf of the people of Charlestown and the city of Boston,” said a spokesman. “This includes conversations with Wynn officials around whether or not there is such an opportunity. Today’s discussions were productive and they will continue.”
Wynn Resorts issued this statement, “Each week, we make great progress in moving our project forward; our dialogue with the city of Boston is a part of that process.”
In addition to the lawsuit already in court, Boston filed another lawsuit last week, this one challenging the Massachusetts Environmental Protection Agency granting of an environmental permit in September to go forward. That was the last governmental hurdle remaining for Wynn to move ahead. Boston’s challenge to it is seen by some legal and political observers as the last arrow in Boston’s quiver. Walsh denies that his options are dwindling.
He told the Globe, “I read the papers,” and added, “But I’m getting briefed by the lawyers too. I don’t know what’s going to happen with the lawsuit.”
So far Boston has spent $1.5 million on its legal challenge to the Wynn Everett. The mayor and his lawyers have also chosen to try to litigate the issues in the press almost as much as in the courts.
One possible route that the city could take now is to agree to take the $25 million that Wynn is already obligated to pay into a state mitigation fund. The governor and the legislature would have to agree to such a deal.
MGM Springfield
Reacting to the announced intention of MGM to downsize its $800 million MGM Springfield by not building a 25-story hotel tower, several members of the Springfield city council unsuccessfully tried to put an advisory referendum on the ballot to gauge the voters’ reaction to the proposal. Besides not building the hotel tower, MGM would switch the hotel to an existing six-story structure with 250 rooms.
The ballot question would have asked voters: “Do you support an amendment to the Host Community Agreement between MGM Springfield and the City of Springfield, previously approved by a referendum vote, which would eliminate the high-rise glass hotel at 73 State Street, Springfield, Massachusetts and which would make other changes to the development site?”
The council held a hastily scheduled meeting where it attempted to put the measure on the November ballot. Council President Michael Fenton led the effort. The council found out on September 22 of the proposal, and also found out that they needed to file the measure by September 29. In something of a comedy of errors the council president misunderstood when on September 29 he needed to file the initiative—and missed the deadline with the Secretary of State.
Mayor Domenic Sarno, who is a strong supporter of the casino, is being criticized for not working closely with the council about the quickly conceived referendum.
Ron Chimellis of the Republican wrote last week: “The referendum was a bad idea, but moving forward, it would behoove Sarno to improve his communication with his elected City Council. Of course, it would also help if the Council would stop throwing pointless obstacles into MGM’s path.”
He added, “The ballot question would not have been about hotel shape. It would have been another, last-ditch chance for sore losers to challenge the casino’s arrival. If a question had made the ballot, its dry description of hotel design would not have reflected the true motives behind it. Between the lines would have furtively been the real question: do you trust these casino guys or not?”
MGM Springfield President and CEO Michael Mathis told the council last week that the downgrade of the project is the result of “skyrocketing costs” and that the altered plans will meld the project more into the existing architecture of the downtown area. It will also, he said, encourage more pedestrian activity.
In a press release Mathis said, “We have never lost sight of how important it is to integrate our development and its unique design needs with this historic New England downtown.”
Members of the Springfield Historical Commission are dubious of the change because they were told two years ago that MGM would be unable to alter its tower design and location—and now it has suddenly changed its mind.
Commission Chairman Ralph Slate told the Republican last week, “I will, however, say that it’s disappointing that MGM had told us for two-plus years that there was no other feasible design for the hotel than their initial design which would result in the demolition of the United Electric Building – a building listed on the National Register of Historic Places.” He added, “But their architects managed to find some creativity once it suited MGM.”
In August the commission agreed to plans that included saving the façade of the old Electric Light Company, if not the building itself. They continue to worry that the new site for the hotel will visually impact the facade of the Union House.
Besides eliminating the hotel tower, MGM also wants to move its originally planned 54 apartments away from the casino footprint to other sites in the downtown area.
