MGM’s senior vice president and spokesman, Uri Clinton last week made an appearance in Bridgeport talking up MGM’s campaign to persuade the state to allow it to build a casino in the city.
This campaign is part of MGM’s longstanding campaign to deflect the state’s intention of allowing the state’s two gaming tribes, the Mohegans and Pequots, to build a third, commercial casino, near the state line with Massachusetts., and 14 miles from where MGM is building a casino.
The tribes are working together to build a $300 million satellite, commercial casino in East Windsor. They were given the go-ahead without a competitive bidding process.
MGM sees that casino as a direct threat to its MGM Springfield, due to open in less than a year. So, as a counterstroke several weeks ago it boldly proposed a $675 million casino in the state’s largest city, even though there has been no indication from lawmakers that such a casino would be welcome.
One lawmaker who does welcome the proposal is State Rep. Ezequiel Santiago who has been talking it up in the state capital Hartford and trying to convince Governor Dannel P. Malloy to backtrack on his opposition.
Clinton spoke to the East End NRZ, a planning organization it hopes to recruit to its cause. He appealed to the sentiments of some residents who feel their neighborhood and city hasn’t been well served.
“MGM, a Fortune 300 company, knows Bridgeport is not invisible,” said the MGM executive in a meeting covered by the Connecticut Post. “We will do what other people wouldn’t, or couldn’t see their way to doing.” He added, “I’m not trying to convince you gaming is right,” he said. “I’m not trying to convince you gaming is the answer. But Bridgeport’s not invisible and it deserves this type of investment.”
Rep. Santiago, giving a nod to the nine ministers attending the meeting, asked Clinton how to address the criticism that more casinos would create more problem gamblers.
Clinton replied, “If there’s problem gaming, MGM didn’t bring it here.” He said MGM takes part in programs to help problem gamblers control their habit.
He said MGM would be open to meeting targets for hiring and contracting with minorities. “We’re willing to make reports to public agencies whether or not we’re keeping our word.”
At the same meeting State Senator Ed Gomes, counseled caution. “There’s a lot of things to consider before we do this,” he told the audience after listening to Clinton’s presentation.
As reported by the Post, Gomes said, “Let me tell you the big thing up in Hartford,” before giving a short history of how he and other local lawmakers agreed to the tribes’ proposal to operate a casino in East Windsor—as a way of blunting the effect the MGM Springfield will have on the bottom line of the Mohegan Sun and Foxwoods casino resorts.
At that time, he noted, MGM demanded that the legislature open the third casino up to a bidding process, so that it could bid.
“The reason they don’t want to see a casino in East Windsor is because that would cut off business in Springfield,” said Gomes. “It’s all a game. To us, it’s all a game.” He said he doesn’t oppose Clinton’s proposal. “If it works, it’s gonna be elegant for Bridgeport,” he said.
But, he insisted. “I’m not gonna say what we did is wrong.” As a longstanding supporter of the working man, Gomes said he was concerned about the threat to Connecticut jobs posed by the MGM Springfield, as well as the proposed Bridgeport casino.
Clinton noted that MGM has promised to pay Bridgeport $8 million a year as a host community. Others pressed Clinton to talk about how much taxes the company was willing to pay to the state—however he was unwilling to discuss that in public.
Critics of the proposal insist that MGM’s proposal is meant to provide cover for the company while it pursues its federal court case to try to get the law passed earlier this year overturned.
So far, its efforts have been unsuccessful. Last month the 2nd U.S. Circuit Court of Appeals rejected the argument that it was violating its constitution by expanding gaming without a vote of the people.
However, Clinton gives every indication that MGM’s proposal is not a bluff. He told Bridgeport residents last week that his company is ready to break ground quickly if allowed to.
That seems unlikely since it would violate the tribal state gaming compact with the Mohegans and Pequots, that guarantees them a gaming monopoly in return for paying the state 25 percent of their profits. If they stopped making those payments the state would lose $250 million a year.
Some speculate that MGM’s very public display is intended to persuade the Bureau of Indian Affairs from giving the approval to an amendment to the tribal state gaming compacts that make clear that if the tribes themselves operate a commercial casino that it doesn’t violate the exclusivity guarantee of the compact.
A recent letter from the BIA was very unclear about whether the BIA would give that approval.
The tribal casinos remain a potent economic force in the state, which, according to recent report by the American Gaming Association, between them have an estimated economic impact of $3.7 billion, including supporting 25,197 jobs that create $1.2 billion in wages and $828.6 million in taxes and direct payments.
That makes Connecticut the fourth largest Indian gaming state, in spite of its small size, which puts it in the same league as California, Washington, Florida and Oklahoma.
The AGA’s “Economic Impact of Tribal Gaming: A First-Ever State-by-State Analysis,” authored by economist Alan Meister, concludes that the total economic output by Indian gaming is $96.6 billion, including 635,320 jobs and $16 billion in taxes.
According to the report, “Tribal gaming has experienced tremendous growth over the years, becoming an important component of the casino gaming industry,” adding, “Since the passage of the Indian Gaming Regulatory Act in 1988, tribal gaming has grown 300-fold from a $121 million segment of the U.S. gaming industry, consisting of small bingo halls and gaming facilities, to a $30 billion plus segment in 28 states that includes many resort destination casinos that are on a par with the most successful commercial casinos in the country.”
Connecticut was one of the first states to take part in that tremendous growth. Foxwoods, which remains the largest casino on the continent, opened in 1992, followed by its great rival, and now partner, the Mohegan Sun four years later.
Besides partnership together on their satellite casino, the erstwhile rivers are taking steps to lure the most challenging generation they have faced, the Millennials, using eSports.
They unveiled their strategy at the recent Global Gaming Expo in Las Vegas, where eSports was discussed on nearly two dozen panels.
The need is urgent. To replace the Baby Boomers who are leaving the market, while attracting the Millennials and Gen X’rs who haven’t shown a lot of enthusiasm for gaming.
Yet studies show they could be enthusiastic, if gaming was linked to their love of competition and games in general. They don’t consider the modern slot machine part of that world. They love interactive games that are determined by skill and many were raised with Xboxes clutched in their small hands.
Last week Mohegan Sun President and General Manager Ray Pineault told Hartford Business his casino is exploring hosting mega tournaments and sponsoring a professional eSports team. So far, he says, they haven’t figured out how to make money from this.
For example, how do you bet on eSports contests? Player vs. player, or as a spectator sport? How do regulators guarantee the games’ integrity?
Critics say that the casinos are dragging their feet and if they take too long they will lose the opportunity to capture the loyalty of a generation. They point out that even if the casino can’t precisely monetize such games, it will make additional money selling food and drink. It could, they say, take years to develop a loyal following.
Pineault, although skeptical, says that Millennial-oriented games will open next year and that plans for something more expansive are in the works.
Foxwoods CEO and President Felix Rappaport revealed to Hartford Business that much the same analysis is taking place. He noted that the resort is opening a new kart racing attraction and zip line before the end of the year.
Foxwoods is also offering mobile fun apps that provide the casino experience—albeit with the money.
He insists these efforts are NOT intended to make the casino more kid-friendly. “The zip line is not aimed at kids; it’s for an older audience,” he said. Foxwoods has plenty of space, he said, so it can accommodate many different kinds of attractions.
One might be a large eSports gaming area, he said. One that could accommodate competitions with seating for spectators.
Skill based games have been a hot topic at recent G2Es. But both CEOs say that early experiments haven’t proven compelling.
So, gaming manufacturers are falling back on what they know, adopting well known games like Pac-Man, adding a casino component and allowing two or more players to compete.
