The Powerball: winners and losers
1 year ago
BROCKTON – The Mashpee Wampanoag Tribe said that the Genting Group is putting putting forth millions of dollars to build its casino project in Taunton, and that the developer behind a proposed gaming destination in Brockton is a liar to say otherwise.
Cedric Cromwell, tribal chairman of the Mashpee Wampanoag Tribe, blasted Chicago developer Neil Bluhm, the developer behind a proposed casino in Brockton, during a public meeting with the Massachusetts Gaming Commission on Tuesday. Cromwell said Bluhm is “immoral” for funding a lawsuit aimed at reversing the U.S. Department of Interior decision made last year to grant the tribe land in trust for its $500 million Taunton casino project, in an effort to secure his own commercial casino license in Brockton.
“Neil Bluhm and team, they are going to lie to you, and say we are not funded,” Cromwell said. “You have the No. 1 gaming company in the world that dwarfs Neil Bluhm. Well-established, the Genting Group is the biggest, the most powerful, the strongest. We are funded. We are moving forward.”
Cromwell continued on with a diatribe against Bluhm, the chairman and founder of Rush Street Gaming, which has a local affiliate called Mass Gaming and Entertainment that is pursuing a $677 million casino project at the Brockton Fairgrounds. The gaming commission said previously that it plans to make a decision on the Brockton casino application by the end of April, while considering the legal standing of the tribe’s land in trust in Taunton.
“The lies that others have been communicating, like Neil Bluhm – it’s egregious,” Cromwell said. “To even launch and fund a lawsuit against the tribe – when he’s going for a commercial license – how immoral! How sad that that this has become, that someone like this would do such an egregious act.”
Cromwell also lashed out at the Massachusetts Gaming Commission for even meeting with the Brockton casino group, calling it a breach of the Massachusetts gaming law, which gives special precedence for a tribal casino in Southeastern Massachusetts. Cromwell said that the gaming commission would “destroy” the gaming landscape in Massachusetts if approves the Brockton casino license, and that the tribe would give zero gaming revenues to the state in that case, rather than the 17 percent promised by the compact it forged with the state.
Nearly a year ago, the state implied eventual approval of a commercial casino run jointly by Eastern Connecticut’s two American Indian tribes, seemingly guaranteeing the venture’s success — even though the state’s top attorney at the time warned of legal uncertainty ahead.
After a tumultuous week in Hartford that proved Attorney General George Jepsen correct, the Mohegans’ and Mashantucket Pequots’ path to success is less clear. And that bodes ill for the more than 9,000 people their respective casinos employ — whose jobs depend upon stable business there — and for the entire Eastern Connecticut economy.
The tribes say their plan to build a third, off-reservation casino north of Hartford is all about protecting jobs at Foxwoods Resort Casino and Mohegan Sun — not about expanding gambling in Connecticut. MGM is building a $950 million commercial casino in Springfield, Mass., and our region’s tribes want to intercept the flow of patrons there.
The hurdles the tribes face, at this point, appear to be twofold.
On Monday, the Schaghticoke Tribal Nation, with MGM’s backing, sued the state over the law passed last year giving the Mohegan and Mashantucket Pequot tribal coalition exclusive rights to pursue commercial casino development on nontribal land.
As Jepsen had warned, the Schaghticokes assert they, too, should be permitted to pursue commercial gaming, and the exclusivity enjoyed by the federally recognized tribes violates the Schaghticokes’ rights under the equal protection clause of the state and U.S. Constitution. The Schaghticokes have so far failed to gain federal recognition but have, for centuries, been recognized by the state.
The state Legislature, when it green-lighted the tribal coalition’s negotiations for a commercial facility in May, gave itself power of final approval over any deal. That gave the state an out in case the law’s legality doesn’t stand up in the courts. Today, it appears that back door was a wise addition.
That being said, the Schaghticokes reportedly were reluctant to admit their involvement with MGM, which reveals the lawsuit to be linked primarily to a business interest rather than a tribal or constitutional issue.
“After weeks of not returning phone calls from reporters, (Schaghticoke Chief Richard) Velky finally revealed that his operation is being bankrolled by MGM,” Andrew Doba, spokesman for the Mohegan-Mashantucket Pequot alliance, said in a statement. “This startling revelation — which according to the chief was a year in the making — should raise a red flag for anyone who is concerned about MGM's plan to steal jobs from Connecticut residents.”
It is unclear whether MGM has a solid interest in backing a potential Schaghticoke-run commercial casino — or if it just seeks to throw a wrench into the Eastern Connecticut coalition’s endeavor.
We are eager to see how the lawsuit plays in court, because if it succeeds, it will impede, and may even scuttle, the coalition’s plans. The fallout could be severe for Eastern Connecticut casino workers.
Meanwhile, the Legislature is considering another measure that aims to evaluate the “costs and benefits” of establishing a commercial casino in the state — a law the Eastern Connecticut coalition opposes. The state Office of Policy and Management and Department of Consumer Protection would be charged with analyzing potential state tax windfalls and, more to the point, the “geographic locations within the state where a commercial gaming facility could be located to maximize state revenues.”
Those geographic locations, for all anyone knows, may differ from the strategic area identified by the Mohegans and Mashantucket Pequots. That coalition and MGM have pointed to separate studies they’ve commissioned — which, unsurprisingly, reached different conclusions. An impartial study may be just the ticket.
And, perhaps more importantly, the law would require “an economic and legal analysis of the potential effects” of a commercial casino on existing slot revenue-sharing agreements between the tribes and the state — another uncertainty that Jepsen warned of in April, and one that evidently has not been clarified in the meantime.
There is still much to sort out, and MGM Springfield is slated to open in 2018. The clock is ticking.
TAUNTON – Opponents of the Mashpee Wampanoag Tribe’s casino project in Taunton said that the financial backers of the gaming destination would proceed at their own risk if they go forward with a groundbreaking planned for early April.
After the Mashpee tribe announced its plans to break ground on a $500 million casino in Taunton, a lawyer for a group of citizens that filed a lawsuit to stop the project said on Tuesday that the construction project could be a waste of money.
“They do so at their own risk,” said Adam Bond, the Middleboro-based attorney who helped file the lawsuit challenging the U.S. Department of the Interior decision to grant land in trust for the tribe in Taunton. “It doesn't change the lawsuit that is pending.”
On Tuesday, Tribal Council Chairman Cedric Cromwell published a statement that three firms – Dimeo Construction Company, The Penta Building Group, and Talako Construction – will begin pre-construction for Project First Light, with a possible groundbreaking date of April 5. The Mashpee Wampanoag Tribe has long told the government and the public that it has the financial backing of the Malaysian multinational Genting Group.
Bond said that the tribe's announcement of an April groundbreaking could be an attempt to convince the Massachusetts Gaming Commission, which is deciding on whether to award a commercial license for a Brockton casino project, that the Taunton project will not be stalled or halted by the federal lawsuit.
“It could be a false bravado,” Bond said. “It could be real. I don't know. I'm not focused on their tactical discussions. ... The gamble is theirs, or their financiers’. It's at their own risk.”
Bond said the tribe is scheduled to respond in federal court to the Taunton group’s lawsuit in early April, just before the scheduled groundbreaking.
The state commission previously stated that it is considering the “tribal status” of the Mashpee Wampanoag Tribe, as it decides whether to award a license to Mass Gaming and Entertainment, the group behind the Brockton bid. That status is the crux of the lawsuit filed on behalf of the Taunton citizens group, pointing to the precedent set by the 2009 U.S. Supreme Court decision in Carcieri v. Salazar, which stated that the benefits of the Indian Reorganization Act of 1934 are limited to tribes that were "now under federal jurisdiction" at the time of the law's passage.
The Mashpee tribe was not federally recognized until 2007, but members claim they have been under federal jurisdiction for many generations. The Taunton citizens group points to historic government documents to deny that claim.
The effect of lawsuit is a crucial consideration for the gaming commission, which is concerned about the potential for market oversaturation, with two potential casinos located close to each other. The Massachusetts Gaming Commission recently said that it now plans to make a decision on the Brockton casino in late April.
Neil Bluhm, chairman of the Chicago-based Rush Street Gaming, the parent company of Mass Gaming and Entertainment, has repeatedly stated during public meetings with the gaming commission that the Mashpee tribe may say it’s going to start construction, but that when it comes down to it, he doubts the tribe’s financiers will invest seriously in the Taunton casino project with a serious lawsuit looming overhead. Bluhm recently helped fund the Taunton group’s lawsuit, and the tribe has repeatedly stated that Bluhm’s claims are dubious.
“We are not questioning Genting’s resources,” said Bluhm, during a November hearing for the proposed Brockton casino. “The question is, would a sound businessman want to risk that kind of money in light of the potential reversal of this case? You might say, initially I will, but once you get down to it, would you really do it? But one thing I think is absolutely clear, a lender is not going to take this kind of risk. This would require 100 percent equity or a guarantee. And this is a binary decision. If courts hold you can’t have a casino (in Taunton), there will be no casino. And all of that money is going to be lost. So, that’s a pretty hefty decision for anyone to make in light of the legal analysis.”
The Mashpee Wampanoag Tribe is scheduled to speak about the legal matter with the Massachusetts Gaming Commission on March 15 during a public meeting at 1 p.m.