In the run-up to the November 4 election, supporters of Question 3, which would repeal the 2011 gaming expansion law, claim that the state lottery will be hobbled if the three casino resorts and one slots parlor authorized by the law are allowed to open.
On October 8 Repeal the Casino Deal issued a press release projecting that lottery revenues would decline by at least 20 percent should Question 3 fail. Since municipalities in the state are largely funded by lottery revenues, Repeal projects that cities and towns will suffer as a result.
However, other states that have legalized Las Vegas style casinos, including Ohio and Pennsylvania saw initial small dips in revenues, followed by a recovery within a few years. The Keystone State’s first casino opened in 2006, followed by eight others, making the state the second largest commercial gaming market. In 2006 lottery revenues were about $3.1 billion. Last year they were $3.8 billion, the highest ever.
In Ohio, which voted to allow four casino resorts and seven racinos, the lottery’s revenues dipped 1.5 percent in 2012, a trend that reversed two years later.
Casino opponents cite a legislative study by state Representative Tom Conroy in which he cited some now discredited studies and statistics, and a paper by an undergraduate student of Duquesne University, and which he used when he opposed the adoption of the 2011 law. Conroy stands by his results. “What I do know is you’re going to have a very serious negative effect on the lottery,” he said in an interview with the Lottery Post. “I still have the same doubts; I still see the same risks I saw seven years ago.”
A former state treasurer, Joe Malone, who also supports Question 3, agrees. “Common sense seems to dictate there is only so much disposable income out there. I think the dollars will be moved around.”
Developers who hope to be operating casino resorts in the Bay State within a couple of years are ponying up donations to fight Question 3. So far opponents have donated $4.5 million just in October.
For the first time in the campaign Wynn donated to No on Question 3. Filings indicate he signed over $1 million to the Coalition to Protect Mass Jobs. During the same period MGM Resorts International, which has been awarded a license for Springfield, donated $2.5 million, while Penn National donated $1 million for the same month.
Penn National may have a spot more on the line than the other developers because it is more than halfway through building its $225 million slots parlor in Plainville. If Question 3 passes Penn will be out about $100 million.
During the same period Repeal the Casino Deal raised about $436,000 while spending about $415,000.
Mob Connections
The same scandal involving owners of property with mob ties that has created complications for the Wynn casino resort proposal in Everett, is also impacting 170 acres of property in Middleboro.
However, the 170 acres in Middleboro is not connected with any current casino proposals, although the town has been associated with a tribal casino proposal in the past. Like the 30 acres in Everett, this 170 acres that is also owned by Dustin DeNunzio, Anthony Gattineri and Charles Lightbody, described by federal and state prosecutors as a member of the La Cosa Nostra. Gattineri and DeNunzio are charged with trying to fraudulently hide Lightbody’s part ownership of 30 acres that Wynn has an option to buy along the Mystic River. They were indicted on October 1. State gaming law forbids any organized crime figure from profiting from a casino.
The mob connection could prevent the Middleboro property from being developed for some time. The property could end up being seized by the federal government, according to Mitchell L. Librett, a professor of criminal justice at Bridgewater State University. Prosecutors say they aim to seize any profits that the three make from the sale of the land to Wynn.
Last week prosecutors arraigned the trio, and filed documents alleging that Lightbody was kept informed during all facets of the alleged efforts to keep his involvement in the land deal hidden. According to prosecutors, the three came up with a “memorandum of transfer” from Lightbody to Gattineri that made it appear as though Lightbody had divested himself of his interest in the land, when he still continued to control a share.
Attorneys for Lightbody and DeNunzio say no crimes were committed and claim Lightbody is a scapegoat.
Because of the prosecutions Suffolk Downs has asked the Massachusetts Gaming Commission to reconsider its decision to award the license for the Boston metro casino zone to Wynn. The commission has declined to reconsider its decision.
The commission’s attorney, Catherine Blue, publicly addressed the letter by Suffolk Downs saying that she disagreed “with your characterization of the facts” and “your interpretation of the commission’s regulations.”
The city of Revere and the union representing workers at the now closed Suffolk Downs has filed suit against the commission, accusing it of “unfairly” awarding the license to Everett. Legal experts say there is a slim but possible chance of overturning the commission’s decision, and so might be a worthwhile risk to take.
One expert on gaming points out that the law gives the commission the final say on awarding licenses, but notes that a court can always rule otherwise.
The suit, filed in Suffolk Superior Court claims that the commission employed a “flawed” process and violated the state.
The commission issued the following statement: “We are confident that this complex licensing process has been executed in a manner that is comprehensive, thoughtful and fair, albeit unsatisfactory and disappointing to those who had hoped for a different outcome.”
Meanwhile Revere’s mayor, Dan Rizzo, is trying to prevent Massachusetts Bay Transportation Authority (MBTA) from selling land that he requires to put an access road to the casino that will avoid crossing any part of Boston.
Rizzo called on the MBTA to stop the sale, saying, among other things, “The public record concerning this sale indicates that Wynn has not completed the necessary work to evaluate the impacts, the MBTA and MassDOT have reached no conclusion as to the proposal’s impact on transit and rail operations, there has been a woeful lack of public discussion about the sale of valuable public property, public officials and communities interested in expanded rail service to the North Shore have not had an opportunity to review how this sale may impact future service in the region, and the MBTA appears to be violating its own procurement statue.”
Rizzo has accused the agency of showing favoritism to Wynn by giving him first crack at purchasing the land, which it put up for sale several months ago.
A spokesman for the agency said that it would review the mayor’s letter and objections.
Saving Thoroughbred Racing
Although Suffolk Downs has closed, some proposals have been floated to try to save the sport in the Bay State. The New England Horsemen’s Benevolent and Protective Association has filed to bring racing back to Suffolk Downs in 2015. It has announced who will lead the plan: Louis Raffetto Jr.
Raffetto helped save racing at Suffolk Downs in 1992, after the track closed for two years. He brought back the track’s signature race, the Massachusetts Handicap in 1995 and remained as the track’s general manager and chief executive officer for a decade. So, for the association, bringing back Raffetto is a natural.
It introduced Raffetto to the commission last week, after which he spoke to re
porters. “I see this as another challenge in my career, maybe the biggest. This obviously is an industry at risk. There are many, many jobs at stake here.”
Suffolk Downs owners remain skeptical to the idea, although they are willing to talk about it with Raffetto. The association would need a lease from the owners and approval from the commission.
The commission remains open to the idea. Commissioner Gayle Cameron commented, “We are happy to see people stepping forward to support thoroughbred racing in Massachusetts. It was a good hearing and an opportunity to hear about plans for future thoroughbred racing, which is one of the Gaming Commission’s priorities.”
