Bureau of Indian Affairs rejects Mashpee tribe's casino deal
October 12, 2012
The federal Bureau of Indian Affairs has rejected the Mashpee Wampanoag Tribe's deal with Gov. Deval Patrick, throwing a curveball at the tribe's plans to build a $500 million casino in Taunton, the state and tribe said.
The reason for rejection was not announced, but was something Indian casino experts predicted was a distinct possibility because the tribe's deal to pay the state 21.5 percent of gross gambling revenues was the most lucrative compact ever negotiated between a tribe and state.
Commercial casinos will pay the Bay State 25 percent of gross gambling revenues, but federal Indian casinos are exempt from such taxes. Federal Indian gambling laws do allow tribes to provide revenue sharing with a state provided they are getting something in return.
The tribe and Patrick will head back to the negotiating table to tweak the agreement, according to a provision of the compact reached in July.
Tribe leaders and Patrick had said they were confident the BIA would see the value in concessions offered by the state in exchange for the revenue. For example, the state agreed to negotiate with the Mashpee tribe even though it does not yet have land in federal trust. The state also agreed to lobby on the tribe's behalf on the land issue and to support the tribe's efforts to codify aboriginal hunting and fishing rights and to settle land claims in and around Mashpee.
The deal took months to work out and was completed during a tight deadline imposed by the state Expanded Gaming Act. The new state law gave Patrick and the tribe only until July 31 to reach a deal or the Massachusetts Gaming Commission could put the Southeastern Massachusetts casino license out to bid.
In a separate deal, the tribe has agreed to pay the city of Taunton as much as $13 million per year for agreeing to host the casino. The tribe will pour another $33 million into the city in infrastructure improvements as part of that deal.
The state is facing a federal lawsuit over its decision to give the tribe a window of opportunity to cut a deal and get its federal approvals. KG Urban Enterprises, which hopes to build a casino on the New Bedford waterfront, is suing Patrick and the gaming commission, calling that provision of the legislation a “race-based set aside.”
In recent weeks, a campaign was launched by opponents of the Taunton casino with an online petition that sought to pressure the BIA into rejecting the compact.
Patrick filed the compact with the BIA on Aug. 30, which started the clock ticking on the review by the federal government. The gaming commission has the authority at any time to put the Southeastern Massachusetts license out to competitive bid if it feels as though the tribe can't get the federal approvals necessary to move forward with its plans.
The Mashpee tribe is backed by Arkana Ltd., a company owned by the same family that owns the Malaysian casino giant Genting Group, which bankrolled Foxwoods in Connecticut.
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