January 11, 2017

Lawmakers split on casino

Leaders of the legislature's Public Safety and Security Committee, which oversees gaming, are split on the potential for the state's third casino, and some are questioning the legality of establishing a casino outside federally recognized tribal land.

Sen. Timothy D. Larson, D-East Hartford, committee co-chairman, said this week he is sure the issue will be voted upon in committee, but added that he doesn't have a preference where a casino is built even though his district includes East Windsor, one of the two final locations under consideration.

"I frankly have no position on where it should end up," said Larson, whose hometown had offered property for a casino but was not named a finalist.

Whatever site is selected — Windsor Locks also is a finalist — as part of a plan from the Mohegan and Mashantucket Pequot joint effort, it must pass through the committee to reach the General Assembly for final approval.

The two tribes, which run the Foxwoods and Mohegan Sun casinos, are attempting to build a casino in the Hartford area to compete with the $900 million MGM casino under constructed in Springfield.

Larson said that while the host community for a new casino in the state will receive significant tax revenue, he supports the casino regardless of where it is built because the two existing casinos support vendors throughout the state.

"The reason why we're doing this is for jobs," he said. "They're going to build a $300 million facility without any state aid and we're going to reap the benefits of it whether it's on one side of the Connecticut River or the other. … I'm not worried about which town it goes into. We've got to worry about jobs for the state."

Larson, who sponsored legislation last year that made possible a request for proposals for development of a new casino along the Interstate 91 corridor, said the state stands to lose a substantial amount of money when MGM opens.

The state's nonpartisan Office of Fiscal Analysis has estimated that the Springfield casino could cost Connecticut nearly $70 million in lost revenue when it opens in the fall of 2018.

The state, Larson said, brings in about $700 million per year from the Connecticut Lottery, off-track betting, keno, and the two casinos.

The casinos are "a proven commodity," Larson said, adding that there are about 15,000 state residents in gaming-related jobs.

Furthermore, he praised the tribes — two competing entities that have been vying for customers for 20 years — for their ability to work together for their benefit as well as the benefit of the state.

"They have a proven track record of success," he said, noting the quick movement of the MMCT partnership.

Open to discussion, but not a fan

Sen. Tony Guglielmo, R-Stafford, another public safety committee co-chairman, does not share Larson's enthusiasm, but said he is not ruling out a committee vote. He's willing to listen, but said he isn't been a fan of the proposal.

"I don't see it as a long-term solution for the state of Connecticut," he said. "It's not a good way to rebuild our economy, to rely on gambling."

Guglielmo said he believes that revenues from casinos already have reached their peak, and there's too much competition in the region.

"I don't think doubling down on this is the right approach," he said. "I don't think it's a great idea."

Guglielmo said the public safety committee has been "very cooperative" in the past, so he stopped short of saying the issue would not be called for a vote.

"I'm not inclined to go recklessly cutting things off without discussion," he said. "I'd like to see what everybody has to say. I think that's kind of a tradition of our committee. We'll certainly be open to discussing it."

Nonetheless, Gulgielmo questioned those who say the MGM facility will draw as much revenue from the state as some contend. He said he'd wait and see what statistics committee members are shown that will back up that claim.

But, he added, legal questions remain about building a casino off of tribal land. He also questioned whether the 2015 law that granted rights solely to MMCT is unconstitutional.

"Why is it that it's just these two groups that are anointed with this right?" he said, adding that giving that kind of special treatment is generally "open to constitutional challenge."

Larson said, however, the advantage of working with the Mashantucket Pequot and Mohegan tribes is that they already have a contract with the state to provide it 25 percent of the tribes' revenue from slot machines.

"If we were to interrupt that on a promise of something from some other organization, we would lose that bird in the hand," Larson said. "It makes no sense to me at all to entertain any other concept.

Questions remain

Rep. Joseph Verrengia, D-West Hartford, a newly appointed committee chairman, said he too has questions about the legality of constructing a casino on private property, citing an April 2015 memo from Attorney General George Jepsen to legislative leadership addressing various legal issues regarding the matter.

In the memo, Jepsen addresses two issues regarding allowing the tribes to jointly operate a casino off tribal land: What it means for the existing compact the state has with the tribes and the potential effects if additional tribes achieve federal tribal recognition.

"Those are two very important questions that I need to have answered before I can take a stand one way or the other," Verrengia said. "Those issues should be resolved before a third site is even considered. Those underlying issues haven't gone away."

And others haven't forgotten either.

"Those are legitimate concerns that have been raised and should continue to be raised," Rep. Christopher Davis, R-Ellington, said, adding there is an ongoing court case to determine whether the state has awarded a monopoly to two tribes by allowing only them to pursue a new casino.

Sen. John A. Kissel, R-Enfield, whose district includes Windsor Locks, said he's been opposed to a third casino in the state ever since it was proposed.

"I think it's bad for the state of Connecticut," he said, adding that he believes it would be unconstitutional to establish a casino off tribal land.

He said it's only been done once in New York, and it was done in compliance with the federal Indian Gaming Regulatory Act.

"None of this complies with that," Kissel said, adding that the areas that have been suggested "are two poor cites," East Windsor and Windsor Locks.

"I'm not keen about the entire concept," Kissel said. "But of all the locations, the East Hartford location seemed to be the one that was best suited for success."

While South Windsor, East Hartford, and Hartford were in the running, MMCT announced last week that it had narrowed the site search.

Kissel added that he is wary of the state continuing to build casinos to compete with casinos in neighboring states.

"I don't want Connecticut to turn into Pottersville," he said. "This is a Pandora's box."

Rep. Scott Storms, R-Windsor Locks, would not say whether he supports a third casino until more details are presented.

"Right now, I don't totally have the information about what the proposals are," he said, adding that he is concerned about the impact to the host community as well as the surrounding communities.

"I really want to see the proposal before I make a decision one way or the other," Storms said. "Until I get all of the information in front of me, I'm not going to make a decision."

Davis, whose district includes East Windsor, agreed, saying that without more details, "it's difficult to say whether or not I would support or not support their efforts."

He said the wording of future legislation is still in question, as is the location, but agreed that the MGM resort could negatively impact jobs and revenue in the state.

"For me, personally, representing East Windsor, it's vitally important that the best interest of our community is first and foremost," Davis said.

He said that if the casino were to be built in East Windsor, he would ensure that the benefits "far outweigh" negative aspects, including the potential for rising crime rates or other societal impacts.

MGM pressing for document release

MGM officials continue to question the process, saying it gives an unfair advantage to MMCT.

"As we have been saying for quite some time, this so-called process is a sham," MGM Resorts International Executive Vice President Alan M. Feldman said, adding that a change in state law in 2015 gave sole development rights to Mashantucket Pequot and Mohegan tribes.

"As a result of the passage of Special Act 15-7, the state is forced to let MMCT do whatever it wants, whenever it wants, and however it wants," he said. "If the state really wants to maximize the revenue and jobs associated with its first commercial casino, it should repeal 15-7 and do what every other state does: have a fair, open, transparent, competitive process."

Additionally, Feldman is claiming MMCT is not in compliance with the law, and is asking the tribes to provide policymakers with the "detailed economic analysis" they referred to last week when announcing the finalist locations.

"MMCT has indicated that the economic analysis was pivotal in their decision making, and officials at the state and local levels, as well as the public, have a right to see the study firsthand," he said. "Communities should not be negotiating in the dark, and the public should not be kept in the dark."

Feldman cited a March study by Oxford Economics, which indicates that a new casino in southwest Connecticut would result in the creation of more jobs and revenue than one built in the north-central part of the state.

"MMCT should release their study immediately, in compliance with the letter and spirit of state law, so that everyone can compare the findings of these two studies," Feldman said.

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