Attorney General raises concerns over casino plan [CT Post]

April 17, 2015

Article as it appeared in the Connecticut Post

HARTFORD — It’s not quite like a spin of the roulette wheel or a throw of the dice, but state lawmakers acknowledge that the creation of one or more additional casinos might not be such a sure bet after all.

There was a range of legislative response Thursday to Attorney General George Jepsen’s detailing potential weaknesses in the proposed joint Mohegan and Mashantucket Pequot plan to build a satellite casino between Hartford and the new MGM Grand in Springfield, Mass.

“The attorney general’s letter raises some serious concerns lawmakers need to carefully consider,” said Senate Minority Leader Len Fasano, R-North Haven. “Clearly, the legislation in its current form leaves Connecticut open to multiple legal issues that could jeopardize our state’s arrangement with the tribes and possibly cause problems in the future.”

Fasano indicated that the negatives could outweigh the added state revenue and expansion of casino jobs.

“I’m open to having the discussion and continuing the conversation,” he said. “But given the attorney general’s analysis, this may not be the best bet for Connecticut.”

Jepsen warned that the new joint venture could become a target of a lawsuit by the MGM Grand, scheduled to open in 2017. Jepsen also said that legal action could be triggered if any of the three unrecognized state tribes — including the Golden Hill Paugussetts of Trumbull and Colchester, the Schaghticokes of Kent and the Eastern Pequots of North Stonington — win federal tribal status under new rules.

Analysis of the 15-page bill, scheduled for review Monday by the General Assembly’s Planning and Development Committee, contains summaries of the potential weaknesses in the venture.

Research by the nonpartisan Office of Legislative Research underscored a variety of weaknesses and potential violations of the state Constitution resulting from providing the tribes with an advantage.

“The bill could conceivably raise constitutional questions in that it appears to provide what may amount to be an exclusive public emolument to the Mashantucket Pequots and the Mohegans,” the analysis notes.

The deal could also violate the federal Commerce clause and the state’s antitrust act.

“The bill could conceivably be construed to have anticompetitive effects in violation of this law,” said the analysts.

Lawmakers have framed the issue as a way to protect existing jobs at Foxwoods and Mohegan Sun, by siting a satellite casino in a convenient location along Interstate-91 north of Hartford, to keep Connecticut gamblers in-state and maintain casino jobs at a time when they are losing business to gambling opportunities in neighboring states.

They have left the door open for other joint ventures to build future casinos along I-84 near Danbury and I-95 in Bridgeport.

Rep. Stephen Dargan, D-West Haven, co-chairman of the Public Safety and Security Committee, where the current bill originated, said Thursday that it was drafted broadly, with knowledge that Jepsen’s office would eventually scrutinize it while the General Assembly’s session continued toward its June 3 adjournment.

“We know there’s a lot of language that needs to be interpreted and put into the bill,” he said. “It’s nothing unexpected. And I don’t think the other tribes are going to be part of the equation.”

Senate President Pro Tempore Martin M. Looney, D-New Haven, said lawmakers are in the process of carefully reviewing Jepsen’s letter, which noted the risks of violating the 1994 deal — called a compact — that allowed the two casinos to operate in exchange for 25 percent of their slot-machine revenues reverting to the state.

“Obviously it raises concerns about the vulnerability of the new agreement if any changes were made in the compact,” Looney said in a Thursday interview. “We obviously want to help preserve jobs, but we also want to be careful not to create the potential for loss or potential legal challenges. “We’re exploring it. There is also some question whether the Department of the Interior would have to approve changes or review the compact.”

Mohegan Chairman Kevin Brown and Mashantucket Pequot Chairman Rodney Butler said in a statement that they continue to move forward with the plan and overcome potential obstacles.

“We have been actively engaged for many weeks with the attorney general and lawyers for legislative leadership, working to identify the best way to protect nearly 10,000 Connecticut jobs and hundreds of millions in tax revenue that will be lost when a new casino opens in Springfield in 2017, while also addressing any legal and technical issues with the state,” they said. “We appreciate that the attorney general has provided possible avenues to mitigate those risks. Our commitment has been consistent, throughout those meetings, to work together with the state as partners as we have for many years, and to protect jobs and increase revenue for our state.”