Connecticut’s 3rd Casino Approved – MGM Objections to Continue

It seems we have come full circle concerning MGM and their opposition to Connecticut’s casino expansion.

It was March of 2015 when the two tribes in CT asked for permission to build a casino off I-91 near the Massachusetts line to intercept patrons on their way to MGM Springfield, hoping it would be done and open by 2017.  MGM Springfield, a $950 million casino is a major threat to force more declining revenue of Connecticut’s gambling industry and impact the local economy by reducing employment opportunities.

MGM Springfield Downtown

Well it’s 2017, and CT is finally seeing it’s expansion come to life.  But, it will surely fizzle if MGM International has anything to do about it.

The two tribes that  were enemies and then competitors for centuries even when they were allowed to build two of the largest casinos in country, offering the only Las Vegas style resort gaming in the Northeast outside of Atlantic City, are now in it for the long-haul together.

Kevin Brown, left, Chairman of the Mohegan Tribal Council and Rodney Butler, right, chairman of the Mashantucket Pequot Tribal Council,

Kevin Brown, left, Chairman of the Mohegan Tribal Council and Rodney Butler, right, chairman of the Mashantucket Pequot Tribal Council,

A third casino in CT gets ready to move forward.  MMCT, the Mohegan Sun and Mashantucket Pequots tribes’ combined venture is soon to get the Governor’s backing, completing the state’s blessing for a new casino in East Windsor.

In two years of fighting, litigation, television commercials, community propaganda and interesting surveys to support their findings, MGM has thrown everything they could at the casino wall, hoping for anything to stick and sway the people of CT and their legislators.

The first attempt by MGM was a lawsuit challenging the exclusive right for the two tribes to jointly operate and build a competing casino. MGM insisted they could make money in CT (even though they pulled out of joint venture with Foxwoods) and that the casino bill violated the Equal Protection Clause of the 14th Amendment. A federal judge in January of 2016 dismissed the company’s lawsuit to block the state of Connecticut’s 2015 tribal gaming act.

At the same time, MGM backed the Schaghticoke Tribal Nation, in Kent, CT – officially recognized by the state but not the federal government – to sue the state of Connecticut’s bill, claiming they had a right to a casino.  But land claims, the lack of federal recognition and then the resurrection of the law suit all dismissed again recently seem enough to keep the Schaghticoke demands futile.

Seal of the United States Bureau of Indian Affairs

Seal of the United States Bureau of Indian Affairs

MGM then sought help from the Bureau of Indian Affairs, stating that a casino off tribal land would break the original agreement from 1993, saying that approving this bill would sever the pact for 25% of the slot revenue to the state. MMCT assured legislators that the proposed construction of a third casino would not jeopardize any gambling agreements reached between the state and the two tribes in 2016 & recently when the BIA agreed.

Officials from the two tribes provided legislators in 2016 with copies from a letter sent by the current Assistant Secretary for Indian Affairs at the country’s Department of Interior stating that the existing gambling compact, under the terms of which Connecticut is provided with 25% of net revenue from slot machines in return for securing the two tribes with the exclusive rights to operate gambling venues within the state’s borders, would not be affected by the opening of a third casino.”

Two bills were eventually issued to the CT legislature earlier this year – one for the MMCT joint venture on the CT/MA border, and one outlining an equal bidding process for a casino in the southwest part of the state (where MGM could possily bid and build a casino). MGM continued to televise ads in CT under the moniker of MGMConecticut.org, trying to persuade CT’s residents of the need for equal bidding for a casino license, saying 71% of the state’s surveyed residents were in favor of an open bidding process.  All the local TV stations, all hours of the day were not enough to change the representatives vote.  Where is that 71% (of whatever sample size) when MGM needs them?

MGM has waged an all out war to try to save its interests across the border.  Whether or not is is to save MGM’s chances for a casino in CT, or just continuous stalling tactics while preparing for MGM Springfield to open,  MGM has had a five-prong attack:

  1. a legal fight in federal court,
  2. lobbying at the Connecticut State Capitol,
  3. bringing the fight to Congress
  4. instigating the Schaghticoke Tribe in Kent, CT to legally pursue it’s right to the casino pie – have proved fruitless in trying to block the construction of a third tribal casino thus far
  5. influence the people of CT to consider an open bidding process

Results?

  1. The federal court and the BIA has already thrown out MGM’s previous lawsuit
  2. Lobbying at the state capital didn’t succeed in bringing about the open bidding process
  3. The CT Senate, House, and soon Governor Malloy, approve the process for the MMCT casino in East Windsor.

I say MGM’s main purpose in all of this was to stall – because the urban casino they are building is a questionable success.  It will be great for MGM, but will it be good for Springfield?  Remember, MGM and CEO Jim Murren himself has said they are in the hotel and entertainment business, not the casino business.  How does Massachusetts and the Massachusetts Gaming Commission feel about their revenue being secondary in MGM’s plan?

Cinema in East Windsor for proposed casino.

Cinema in East Windsor for proposed casino.

MGM Springfield is in a much smaller city, and it will go up MMCT’s Mohegan Sun / Foxwoods casino in East Hartford and will continue to feel pressure from Plainridge Park Casino, the only open casino in Massachusetts. New York projects near western Mass. and Wynn’s Boston Harbor Casino/Resort will definitely tug at Springfield’s bottom line.  MGM said in 2016 that they didn’t believe in a ceiling on  gamblers discretionary funds and were not concerned with the possible saturation of casinos – do they still believe that?

Now, MGM is back to square one, leaning on the judicial branch to stop MMCT in East Windsor. I think I can still hear someone speaking in the wind from Springfield, “just stall, I don’t care how, just stall….”

And that, my friends is a complete circle.

Binbin

 

 

Massachusetts More Worried, Not Mohegan Sun, About New England’s Casino Share

Massachusetts

Massachusetts Casino Industry Worried?

After chatting with friends and colleagues recently in Las Vegas concerning their thoughts on Massachusetts’ Gaming Expansion, it seemed to be unanimous – Massachusetts is doing it their way, but not necessarily the best way.  They are running a little scared lately, but are too stubborn to show it. It includes badgering Steve Wynn, making Rush Gaming Developers wait for a Region C decision, and letting MGM

MGM Springfield

New rendering of MGM Springfield’s cut down proposal.

change this and that without approval. It seems the Bay State’s opinion of Mohegan Sun Resorts follows the same narrow-minded spin.

Bruce Mohl, from Commonwealth Magazine, recently reported in his article “Casino Border Wars” that Mohegan Sun as an underachiever not good enough for Massachusetts.  With the history Mass casinos so far, they would have been so lucky to have Mohegan Sun part of that gambling Plan.

His reasons for such a poor opinion of the Mohegan Tribe’s casinos?  Well, let’s take a look:

  1. A key reason for the casino’s success was the large number of customers pouring over the border from Massachusetts. That’s True. But let’s include Maine, NH, Vermont, Rhode Island, NY, and NJ (which took a bite out of Atlantic City).  It’s because both Foxwoods & Mohegan Sun are “Destinations,” unlike Plainridge Park Casino (a box of slots – MGM’s own description) and the proposal in Brockton which represents a mid-level locals casino in Nevada.
  2. Not welcome in Palmer.
    Mohegan Palmer Casino

    Mohegan Sun’s rendition of Mohegan Palmer Casino

    Palmer Mohegan Sun applied for the Region A (Western) license of 150 acres of land purchased in Palmer – land that was waste-free (Everett) and didn’t entail bulldozing blocks of historical buildings (MGM in Springfield) and was closer to the newest threat to western Massachusetts. The bid was rejected by 94 votes out of over 5200. Why? It would “destroy the rural character of a town.” So, instead, they mirror the state’s poverty level of 11% and added a Motor Speedway.  Go figure.

  3. Not Welcome in Revere. Mohegan Sun joined forces with Suffolk Downs in Revere in a bid to win the eastern Massachusetts casino license, however, Wynn Resorts was chosen to build a casino in Everett. Wynn was great in winning over the Gaming Commission, by criticizing the Revere proposal as Mohegan Sun’s pursuit was “to protect its flagship casino in Connecticut.”
    mohegan-sun-revere-casino-rendering-7414f532fa69586d

    Rendition of Mohegan Sun at Suffolk Downs in Revere

    The MGC believed it, even though the Mohegan Tribe has made Resorts Casino in AC a winner and it’s Mohegan Sun Pocono in Pennsylvania continues to be a success.

  4. Protecting It’s Own Casino Interests. Mr. Mohl and the rest of Massachusetts thinks it’s awful that Mohegan would expand to other areas to protect its assets. But, he just doesn’t get it.  MGM & Wynn expanded outside of Las Vegas, and they did it to expand their brand. MGM is looking at Georgia for an additional site, and both are in China. Expanding their brand.  Penn National expanded to Plainville after already owning Hollywood Hotel Casino in Bangor, Maine.  They now own two New England casinos, yet nothing was said about Plainridge Park protecting it’s Hollywood Casino.  The Mohegan Tribe, much like Penn, MGM, Wynn, Caesars’, etc have the right to expand.  If you’re successful in the casino industry, that’s what you do.

Mohl’s bottom line, and I quote, “What all this maneuvering tells you is that Mohegan Sun — and the state of Connecticut — are very worried about the impact of Massachusetts casinos on the casino businesses in Connecticut and willing to do just about anything to blunt their impact.”

If something doesn’t scare you, or threaten you, ignore it? But if it is a concern, pay a lot of attention to it – and that’s just what Massachusetts is doing.  CT knows that more casinos in New England will impact their two large destination casinos, so they are doing something about it.  But Massachusetts continues to look south to CT and south-east to Rhode Island as both states make plans to battle or New England’s gamblers.

Rendition Wampanoag Casino in Taunton

Rendition Wampanoag Casino in Taunton

Plainridge Park Casino

Plainridge Park Casino in Massachusetts

Massachusetts is the state most worried about it’s share of the pie.  MGM wouldn’t be trying to stall CT’s third casino and the MGC wouldn’t be considering no Region C license due to the Wampanoag’s casino proposal gaining momentum if they weren’t. Plainridge Park has seen two straight months of decline – a sudden concern – and Twin River & the CT casinos have seen positive revenue in recent months.  MGM says it’s not worried, but continues to cut back its approved proposal in Springfield, and both MGM & Wynn won’t be making money for the Bay State until late 2018.

So who’s doing the most maneuvering and who is the most worried?

I say Massachusetts.

That’s all for now.

 

Binbin

 

MGM’s Real Intentions in Suing Connecticut

imagesMGM continues to pursue it’s litigation with the State of Connecticut concerning a third casino, saying it “… is the result of an illegal and unfair gaming act…” according to the Equal Protection Clause of the 14th Amendment.  Essentially, the 14th amendment addresses “Equal justice under law” and mostly refers to states rights against discrimination. According to MGM, this includes the discrimination of commercial competition.  When Foxwoods & Mohegan Sun were allowed to agree to a casino outside their tribal lands, should they have opened it up to the industry?

massachusetts-to-pilot-new-tool-to-limit-gambling-lossesYES, I say!  Take a page out of Massachusetts playbook, as follows:

  • Step 1 – Charge anyone interested the $400,000 application fee.
  • Step 2 – Quickly set up voting for community endorsements.
  • Step 3 – Whittle away those that Connecticut thinks are not in it’s best interest.
  • Step 4 – Pick the casino that they had in mind all along – like Massachusetts did with MGM Springfield & Wynn Everett.

Then everybody’s happy, right?  The process is done – the result is the same.

Basically, MGM is saying this pact denies other industry interests to build a casino in the Nutmeg state.  In 2006, MGM was looking to increase its brand recognition on the East Coast, and partnered in a relationship with Foxwoods. The MGM tower in 2008 at a cost of $700 million.

Fox Tower at Foxwoods

Fox Tower at Foxwoods – Originally the MGM Casino & Tower.

In 2008, MGM pulled out of its partnership.  According to then MGM spokeman Clark Dumont, MGM wanted to “avoid confusing consumers as it pursues a bid to build its own casino Springfield, Mass.  So, what is so different now?  If MGM is truly concerned for the state’s residents and rights of further casino industry commerce, wouldn’t a MGM casino built in CT now “confuse consumers?”

Of course. This legal strategy IS not only to confuse consumers, but DRAG out the beginning of Connecticut casino threat to MGM Springfield, and GAIN time for it’s already late opening in 2018.

Hypocrites – hiding their real intentions behind a smoke screen of the constitution for their own selfishness.  Their presence in CT with the Foxwoods partnership wasn’t good enough in 2008 – why do they want a chance now?

They really don’t!  They are scared that the CT satellite casino on the border will spoil their party – because the mighty MGM wants the ONLY party.  Hey MGM, have you noticed what’s happening west in New York State?

That’s all for now.

Binbin