A symbolic victory for casino expansion [CT Mirror]

Article as it appeared in the Connecticut Mirror

The state Senate approved a consolation prize late Wednesday for those hoping to see a new casino authorized to combat growing competition from gambling facilities in neighboring states — particularly one to open in Springfield in 2017.

The bill, which now heads to the House of Representatives, instead establishes a search process for a potential host community for a new casino — and requires legislative approval for any deal to develop a new facility.

The measure also gives legislators another year to address a series of difficult legal concerns raised earlier this spring by Attorney General George Jepsen.

“I know this is not the end, this is the first step of a two-step process,” said Senate Majority Leader Bob Duff, D-Norwalk, who added that legislators aren’t done working to protect jobs at the Foxwoods Resorts and Mohegan Sun casinos. Connecticut’s middle-income households “count on those jobs each and every day,” he added.

“It is an effort first and foremost to try to secure and protect jobs in the state, to try to protect an industry,” said Senate President Pro Tem Martin M. Looney, D-New Haven, who added that the industry has become “a very substantial source of employment for the people of this state for the past two decades.”

Leaders of the Mashantucket Pequot and Mohegan tribes, which run Foxwoods and Mohegan Sun, respectively, originally approached legislators last fall arguing that they needed to open one to three new, smaller casinos outside of tribal lands to preserve a customer base threatened by facilities recently opened or under development in neighboring states.

The chief threat, tribal leaders said, comes from the new $800 million casino being developed in Springfield, Mass., by MGM Resorts International. A study sponsored by the tribes estimated that as many as 9,300 jobs would be lost in the next few years if nothing is done.

The best solution, they argued, would be for the state to allow them to open one smaller casino in north-central Connecticut to intercept patrons who might otherwise seek to visit the Springfield facility. They also sought permission to open two more in other parts of the state.

The new bill would allow the Mohegan and Mashantucket Pequot tribes, acting as a single business entity, to approach municipalities about establishing one casino facility. The tribes would be allowed to enter into a development agreement with a municipality, but it would be contingent on state legislators taking action to allow it.

Several senators from Eastern Connecticut spoke of the economic benefits the casinos have brought and the need to preserve jobs in a part of the state that has struggled economically.

Sen. Cathy Osten, D-Sprague, acknowledged the “ills” associated with gambling. But she added, “We in Eastern Connecticut lag behind the rest of the state in job creation and cannot afford to lose a single job.”

Sen. Paul Formica, R-East Lyme, said the two casinos are “under siege” from competition around New England. “This is not the time for another hit,” he said. “This is a time that we need to protect the 14,000 jobs that the two combined resorts provide.”

Anti-gambling forces in the Senate argued Wednesday that another casino was not the best solution to Connecticut’s economic woes.

“If we go down this road, and it is the wrong one, are we able to pick up the pieces of the lives shattered?” asked Sen. Tony Hwang, R-Fairfield, who said Connecticut does far too little to recognize or combat the gambling addiction.

“The gambling dollar is dwindling, not growing,” said Sen. John Kissel, R-Enfield. “Whatever we build now is not going to help the situation. We need to think differently now. The world has changed.”

Perhaps the biggest obstacle to opening a new casino arose on April 15 when Jepsen warned legislators that giving the tribes exclusive rights to a new casino was itself a gamble, potentially endangering the current profit-sharing deal with the tribes and exposing the state to claims of illegal favoritism.

His memo addressed two main issues: The potential impact on the state’s existing tribal compacts, which allow slots at the two casinos in return for 25 percent of gross slot revenues; and what would happen should another tribe win federal recognition in Connecticut.

The bill approved in the Senate late Wednesday would allow the state to abandon the effort to establish a new casino if further legal research determines it is not feasible.

Sen. Michael McLachlan, R-Danbury, raised concerns that the federal Bureau of Indian Affairs could allow other tribes to seek recognition, potentially jeopardizing the agreements the state has with the Mohegans and Pequots. Until that is settled, he said, these expansion plans should be put aside.

Two southeastern Connecticut Republicans – Formica and Sen. Art Linares of Westbrook — joined 18 Democrats in voting for the bill. Three Democrats — Sens. Beth Bye of West Hartford, Dante Bartolomeo of Meriden, and Mae Flexer of Killingly — joined 13 Republicans in opposing the measure.

“We will continue to work towards final passage, and we remain committed to working with the attorney general to protect the state’s interest while also protecting 9,300 jobs” at risk, Mohegan Tribal Chairman Kevin Brown and Mashantucket Pequot Chairman Rodney Butler wrote afterward in a joint statement.

If the House approves the bill, it would move to Gov. Dannel P. Malloy’s desk. But the governor has been cautious and noncommittal about the matter to date.

Talking with reporters earlier Wednesday, the governor said he still believes the issues raised by Jepsen are substantial.

“They need to be satisfied,” the governor said. “And perhaps the method that the legislature is currently looking at might allow that to happen before any problems or harm would be created. So in that sense, that’s an interesting development.

Malloy spoke positively of one change in the bill, which would require communities interested in hosting a casino to make presentations and compete for that.

“What I believe is that the legislature can’t name a winner, that there has to be a process,” he said. “I conveyed that previously to the leadership. The legislature shouldn’t be deciding which community is going to get a casino. Legislatures by their nature are political creatures, so I think that this partially addresses some of the concerns that I raised in the past. Whether that does sufficiently, we haven’t had time to study.”