Senate Forwards Watered-Down Casino Bill To House [CT News Junkie]

May 22, 2015

CT News Junkie
A majority of Senators felt that the benefits of allowing Connecticut’s two federally recognized tribes to open up one casino north of Hartford would outweigh the risks recently outlined by Attorney General George Jepsen’s office.

The bill, which is a watered-down version of the original legislation that would have allowed the two tribes to build up to three new casinos, would require the tribes to enter a development agreement with a municipality first before returning to the General Assembly for approval of a satellite casino. It passed the Senate on a 20-16 vote Wednesday evening after about an hour of debate.

The hope is that a casino in north-central Connecticut would help prevent gamblers from leaving the state and heading north to the new, $800 million MGM Springfield casino that is scheduled to open in late 2017.

Proponents of the casino bill sought approval from Jepsen’s office, but Robert Clark, special counsel to the attorney general, was unable to put to rest lawmakers’ concerns. In a May 19 email, Clark outlined the lingering concerns with the Mohegan and Mashantucket Pequot Tribal Nation opening a casino outside their reservations in southeastern Connecticut. The email said that if the tribes ask the U.S. Department of the Interior for guidance, the state could risk losing its portion of the slot revenues it currently receives from the two casinos.

Opponents felt the legislation was unnecessary and risky.

Senate Republican Leader Len Fasano, R-North Haven, who opposed the legislation, said the tribes are more than welcome to talk to municipalities about where they want to open a casino. He said they don’t need the legislature’s support to do that.

“What this bill does is say: we as a legislature are asking you as a tribe and you as municipalities, if you’re interested, to get together and work hard with the Department of Consumer Protection . . . to put forth a project that we don’t know if we can pass,” Fasano said. “That we don’t know if we can legally do.”

He said what they do know is that Jepsen said in an April 15 memo that there are significant problems in allowing the tribes to build a casino outside the reservations. Those hurdles may be insurmountable, Fasano said.

“Given the unique nature and history of the state’s gaming relationships with the tribes, there is very little in the way of legal precedent or guidance that allows for a confident analysis of these complex and uncertain legal questions,” Jepsen wrote in his April 15 memo to lawmakers.

A footnote in that letter says Jepsen’s office would be “unable to predict with any certainty how a court would resolve such issues.”

Fasano said that footnote should be a “red flag.” He said that as a lawyer, if he tells his client that, he’s hoping they will heed his advice and decide not to proceed.

What’s at stake? The 25 percent in slot revenue the state currently gets from the two tribes. It’s amounts to about $280 million a year in revenue for the state budget.

But proponents argue that it’s about keeping that revenue — and casino jobs — in the state.

Senate Majority Leader Bob Duff, D-Norwalk, said it’s not a complicated issue, but it takes people a little bit of time to get there. He said people need some time to understand the state would lose jobs, if the state takes no action.

A consultant hired by the tribes found that if they only received permission to build a $300-million casino in north-central Connecticut, it would generate $300.9 million in gross gaming revenue and create more than 2,000 jobs.

The same consultant estimated that Connecticut’s casinos could lose up to 9,300 jobs by 2019 to Massachusetts and New York, if the state fails to do anything in response to new gambling facilities in those states.

Duff said they’ve worked hard to protect the revenue that the state of Connecticut enjoys through its relationship with the two tribes, and he said they have listened to the concerns of opponents. As a result, he said, they made it a longer process than initially proposed.

“Our goal from the outset has been to protect the 9,300 jobs and revenue that will be lost to competition on Connecticut’s borders, and we believe this bill, if approved, will give the Mohegan and Mashantucket Pequot Tribes the ability to begin to take action to do so,” Patty McQueen, a spokeswoman for the tribes, said.
The bill now goes to the House for approval.

Gov. Dannel P. Malloy, who has tried to stay out of the casino debate pointing out that it’s a legislative proposal, said Wednesday that the legal hurdles presented by Jepsen are “substantial” and “need to be satisfied.”

“This is not my legislation,” Malloy said. “This is not my fight.”

Workers from the two casinos have been outside the Senate chamber for the past two days talking to lawmakers to let them know what would happen if they don’t pass the legislation. Three pit managers said they would likely have to seek employment at a casino in Massachusetts or New York if Connecticut decides not to build another casino to attract business.

Thomas Tomillo, a pit manager at Mohegan Sun, said some gamblers are more convenience-oriented and will head to the closest casino, even if the amenities of another casino a few miles down the road are attractive.

Tomillo said he loves the casino industry and will move if he has to in order to maintain his employment. If that happens Connecticut will lose the taxes he pays and everything he contributes to the community.