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Bridgeport casino still in play

Connecticut Post logo Connecticut Post 3/10/2017 By Bill Cummings
An artist's rendering of a proposed casino to be built in East Windsor. © Contributed Photo S An artist's rendering of a proposed casino to be built in East Windsor.

HARTFORD - MGM Grand on Thursday offered to more than replace tribal gaming revenue paid to the state with taxes from a casino resort the company would build in Southwestern Connecticut — possibly in Bridgeport.

The announcement dropped a bomb on plans by Connecticut’s two recognized Indian tribes to build a new casino in East Windsor to offset 30 percent losses expected after MGM Grand opens a nearly $1 billion casino resort in Springfield, Mass.

“We knew this committee would not consider a competing offer if it didn’t cover the Pequot Fund,” said Uri Clinton, vice president and legal counsel for MGM Grand, referring to payments to the state from the tribes. “So the Pequot fund goes away, and you need an alternative that offsets that loss.”

Clinton said MGM, or another developer, would pay a 30 to 35 percent gaming tax “for a resort close to the New York State line,” and those payments would more than make up revenue lost from the Mohegan and Mashantucket Pequot Indians.

In exchange for the exclusive right to operate casinos on tribal land, the two tribes pay the state 25 percent of all slot revenue. Tribal leaders warned that money would end if anyone but the two tribes received a state gaming license.

Although Clinton did not name a site for an MGM casino, the Las Vegas gambling mogul is backing the Schaghticoke Indians in Kent, who for years have wanted to build a casino in Bridgeport.

MGM Grand’s offer came during testimony before the Legislature’s public safety and security committee on a bill that would authorize the proposed East Windsor casino to be built and operated by the tribes to offset expected losses after the Springfield casino opens.

A competing bill, sponsored by State Representatives Chris Rosario and Ezequiel Santiago, both Bridgeport Democrats, would scrap the East Windsor deal and call for bids to build a third casino in the state.

Many argue that Fairfield County is the best location, given the region’s wealth and proximity to New York City.

“That is a suggestion and a red herring,” said Kevin Brown, chairman of the Mohegan Tribal Council, referring to considering other locations. “We have a real proposal with a real plan. Now it is up to us to choose a path Connecticut will take.”

The proposed East Windsor casino, located off I-91 on the site of a mothballed cinema complex, is expected to create 2,800 permanent jobs and upwards of 2,000 construction jobs.

The casino, offering 100,000 square feet of gaming, is not a resort-style facility like Foxwoods or the Mohegen Sun.

Bridgeport casino

Av Harris, a spokesman for Bridgeport Mayor Joe Ganim, said the mayor is watching the debate but is not yet taking a position.

“At this point, we are letting this play out,” Harris said. “MGM and the Schaghticokes are interested in Southwestern Connecticut and the most obvious place is Bridgeport. [The mayor] is waiting to see what emerges. If this goes anywhere, we will sit down and talk.”

Schaghticoke Chief Richard Velky backed the competitive bid bill and, in a show of solidarity, brought a group of tribal members to the hearing dressed in bright red shirts.

“Southwestern Connecticut offers a growing opportunity that is five times the size of the market north of Hartford, a market that can only decline with the high-end competition from Springfield,” Velky said. “Connecticut citizens demand a better deal, so why not us?”

Velky’s tribe has failed to gain federal recognition and the permission to operate a casino on a tribal land that comes with it.

Clinton told the committee MGM simply wants to have “an opportunity to compete” for the state’s third casino.

“We have been public in our support of the Schaghticokes and we are supportive of an open process,” Clinton said. “The Schaghticokes have no obligation to MGM. If they found a different dance partner that is their right.”

Asked if MGM paid for the Schaghticokes’ colorful shirts, Clinton declined to answer.

Clinton said the state could structure licensing of a new casino so it’s issued when the resort is completed, ensuring that tribal payments don’t stop until new revenue is in place. He also said casino operators could be required to pay the state as much as $50 million just to bid for the right to build a casino with a minimum investment of $500 million.

Under the agreement with Springfield, MGM cannot build a casino within a 50-mile radius of the city, Clinton said.

The MGM offer brought a sharp rebuke from State Sen. Tim Larson, D-East Hartford.

“You want to be in Bridgeport,” Larson told Clinton. “I’m annoyed at how you seek to insult a community I represent. I don’t want to have any part of it.”

Lost state revenue

An artist's rendering of MGM Springfield, a resort casino to be built in Springfield, Mass. © Contributed Photo / Contributed Photo An artist's rendering of MGM Springfield, a resort casino to be built in Springfield, Mass.

The Pequots and Mohegans warned an off-reservation casino not operated by the tribes would cut off slot revenue the tribes now send the state.

“Our friends from Las Vegas are here and they say we have not picked the right site,” Brown said. “We have crafted a smart strategy and believe their claims are hard to take seriously. Instead of suggesting Bridgeport is the right place to go, where is the effort [to build there]?”

Former U.S. Interior Secretary Ken Salazar, hired as an expert by MGM Grand, warned the proposed East Windsor casino could prompt federal regulators to void or reduce the compact between the state and the two tribes. The new casino requires federal approval for an amendment of that compact.

“There is a significant risk that the [Bureau of Indian Affairs] would require a reduction of the 25 percent slots-revenue royalty that the tribes currently pay to the state,” Salazar said. “The 25 percent royalty rate is unusually high — higher than 95 percent of all tribal state compacts.”

The tribes dismissed that notion, saying the BIA, a division of the Department of Interior, only considers the amendment not the larger compact already in place.

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