Although three quarters of Connecticut’s voters oppose the idea, the legislature is considering increasing the number of casinos in the state and having the two existing gaming tribes share operation.
Senate leaders, along with tribal and union leaders introduced the proposal at a news conference last week in the state capitol’s judiciary room. No House leaders were at the conference because they were out of town.
“Massachusetts has declared economic war on us, and we’re going to fight back,” said Senate Majority Leader Bob Duff.
The Mohegans and Mashantucket Pequots have been meeting with legislators and a bill may be ready this week, according to Rep. Steve Dargan, co-chairman of the General Assembly’s Public Safety Committee. Hearings should begin on March 17.
According to Dargan, “It’s basically a framework. For the time being we’re looking at three. One in Bridgeport, one in Danbury, and one in the Hartford-Enfield corridor, understanding that as we go forward we might end up with just one, if anything gets passed.”
State Senator Catherine Osten, whose district includes both casinos, told reporters, “We will not stand aside and let other states—New York, Massachusetts or Rhode Island—take jobs away from Connecticut.”
She added, “It stops people from going off into Massachusetts or into Rhode Island or New York. By having the satellite facilities within the Connecticut border, it will stop people from crossing the Connecticut borders for a night of gaming and will continue keeping them in Connecticut.”
Under the terms of the tribal state gaming compact only the tribes can legally operate casinos in the state.
The purpose of the bill is to try to insulate the state’s gaming revenue as much as possible from the inevitable competition coming from neighboring Massachusetts, Rhode Island and New York, both of which are complicating the existing New England gaming market. Its goal is to give the casinos more bang in the New England casino arms race.
Dargan told the Wall Street Journal that the purpose of the legislation is to help the tribes, which have both seen slides in revenue the last few years. Of course, the state also loses money when the tribes do, since it collects 25 percent of slot revenue from the Mohegan Sun and Foxwoods Resort Casino.
“This is still a significant revenue source for our state and our cities,” Senate President Martin Looney told the Washington Times last week.
Last year for the first time the state collected more money from the lottery than from Indian gaming.
“We understand that, one, there’s competition from other states and two, the tribes have been good corporate citizens to the state of Connecticut,” he said.
Mohegan Tribal Gaming Authority CEO Mitchell Etess commented, “This ultimately is more of an issue of preserving tax revenue and jobs.”
Dargan said that as many as three new casinos are possible under the legislation. One proposal would call for a casino with about 1,800 slots and limited amenities in Hartford near the boundary with the Bay State. That is not a large casino, but might be enough to keep some residents, dubbed “convenience gamblers” of the Nutmeg State at home. None of the new casinos envisioned would have hotels or live entertainment.
Charles F Bunnell, chief of staff of the Mohegan Tribe for external affairs, said his tribe envisions a casino with between 1,800 and 2,000 slots and up to 75 gaming tables. The bill calls for table games such as blackjack, poker and craps.
Governor Dannel P. Malloy said he was withholding comments until later. I’ll listen, I’ll watch, I’ll hear what’s going on and what the proposal looks like and we’ll make a decision at some point in the future.”
There is also a movement afoot to allow slot machines at three simulcast facilities in the state, including Shoreline Star in Bridgeport, Bradley Teletheater in Windsor Locks and Sports Haven in New Haven.
However, a just released poll by Quinnipiac University shows that 75 percent of those surveyed oppose more casinos in the state, compared to 20 percent who do. Opposition to allowing the two tribes to open new, smaller casinos is 59 percent to 36 percent.
House Speaker Brendan Sharkey, who did not participate in the press conference announcing the bill, said that bill’s supporters would need to accomplish many things before the session ends in June. These include identifying where the casinos will be located, getting agreements from those communities, and developing a new revenue sharing formula.
This may be difficult, if not impossible, this year, he said.
The two tribal casinos have seen revenues plummet by 39 percent and the numbers of employees drop by 37 percent since 2006, which was their best year. Some of that was due to the effects of the Great Recession, but more can be attributed to a gaming market that is nearing saturation.
Their combined revenues peaked in 2006 at $3.2 billion and were at $1.9 billion last year. Those numbers can only worsen when the $800 million MGM Springfield opens in 2017 right next to the border. Kevin Brown, chairman of the Mohegan tribe, said he hopes to beat that casino opening with one by the tribes. Hartford, one of the cities contemplated for such a casino, is 26 miles from Springfield.
Brown commented, “I think, honestly, the word is equilibrium. The market in the northeast is reaching its equilibrium and the question is simply, which part of that equilibrium stake do we want to take into the state of Connecticut? And if we just sit back. We’ll lose.”
In their day considered the largest casinos in the world, Foxwoods and the Mohegan Sun helped make the southeastern part of the state into a powerhouse tourism destination. They lost the “biggest” status in 2010 when Resorts World Sentosa and Marina Bay Sands opened in Singapore. They ceased being the largest casino in the hemisphere when WinStar World Resort opened in Oklahoma.
The Mohegan Sun isn’t putting all of its faith into the three new casinos, however. Later this month it will begin construction on a second hotel tower, the Earth Hotel, which will cost an estimated $120 million. At a press conference last week tribal Chairman Kevin Brown declared, “When you’re in a fight, you don’t stand still. We’re in a fight, and we’re not standing still.”
The new hotel with 400 rooms will enable the casino to meet the demand for more rooms. The existing hotel turns away half a million room night requests a year from the existing 1,200-room Sky Hotel, said Brown.
Much of the two casinos’ revenue has come from out of state. For example, last year residents of Massachusetts spent $476 million, those from New York spent $214 million and Rhode Island residents spent $193 million at the two casinos.
In Rhode Island the Twin River slots parlor has skimmed hundreds of millions of dollars from Massachusetts. Last year the casino netted $603 million, about 68 percent over the previous year, most of that at the expense of Rhode Island’s other casino the Newport Grand, which it recently announced it was purchasing. Most of that growth came from Massachusetts players.
Clyde Barrow, an expert in New England gaming who was former director of the Center for Policy Analysis at the University of Massachusetts Dartmouth notes that Foxwoods employed 12,800 in 2006, but now employs 7,558. “[This] “is effectively a transfer of jobs from Connecticut to the new gambling venues in New York, Pennsylvania, Rhode Island, and Maine. The gambling arms race in the Northeast has essentially been a war waged against Connecticut and New Jersey – and, for Connecticut, that arms race will continue.”
In a separate but related development the Connecticut state police disbanded its casino unit, which it has operated since 1992, and transferred the duties to the two tribal police departments.
The state agreed to let the tribes take over policing duties once an agreement was in place ensuring that all tribal police were certified by the Police Officer Standards and Training Council. The tribal police have total arrest powers, although state police will still be summoned for serious crimes. The typical casino crime is shoplifting and automobile break-ins.
