FEATURE-Casino hopefuls clash in Massachusetts sweepstakes
By Daniel Trotta
SPRINGFIELD, Mass., June 22, 2012
(Reuters) - The Massachusetts Turnpike carves its way east from Boston through
the upland hills and small towns of western Massachusetts, an area hard-hit by
the recent recession. It is here that some of the biggest names in casino
gambling are laying down fortunes in hopes of reaping big payoffs, while local
supporters and antagonists gird for a showdown.
Massachusetts is but the latest state to bet on gambling as a salve for its
wounded economy. Before the first blackjack is dealt or the first patron craps
out, the municipalities in which the gaming companies hope to set up shop will
have their say.
The Massachusetts law requires casino companies to reach a host agreement
with a town's leadership, then gives local voters veto power through a
referendum.
Proponents point to promised jobs. Opponents decry what they see as an
assault on morality, fear traffic and crime, and doubt the claims of prosperity.
Both sides can claim some momentum.
In Holyoke, where the Mass Pike intersects the Connecticut River, an old mill
town of 40,000 people has said no to Hard Rock Hotel & Casino, which wanted
to build a casino on the country club golf course.
In more bucolic Palmer, a town of 12,000 less than 20 miles (30 km) to the
east, officials are in advanced talks with Mohegan Sun, the company that
operates one of the largest casinos in the country, on Native American land in
Connecticut.
Mohegan Sun is mired in debt with declining revenues. Dream on! [Foxwoods defaulted in 2010.]
The two largest casinos in the
world, Foxwoods and Mohegan Sun (both in Connecticut), are in dire straits. With
$2.3 billion in debt, Foxwoods is effectively bankrupt. Mohegan Sun is not far
behind, even though it has just refinanced some of its debt. Foxwoods does not
have a very positive view of the gambling market moving forward.
Mohegan
Sun revenue falls 40 percent in 2nd quarter 05/01/2012
Similar negotiations are under way in Springfield, the largest city in
western Massachusetts, and in a handful of small towns that have captured the
attention of casino companies.
After two decades of debate the Massachusetts legislature in November passed
a law calling for three resort casinos plus one slot machine parlor in the
state. That made it the 24th state to embrace gaming. Officials hope projections
from experts are right that gamblers could drop $2 billion a year in
Massachusetts betting halls.
The law drew up three districts in the state and allotted one casino license
to each, ensuring that western Massachusetts, an area lagging the rest of the
state in jobs and income as a result of a lost manufacturing base, would receive
a jolt of economic development. The other districts are the southeastern part of
the state and the Boston area.
"The question no more is about the morality of a casino. That's been
decided," said Kevin Kennedy, chief development officer for Springfield. "The
question now is about location and benefits and economics for the community
that's selected."
This was NEVER about morality! It's about ECONOMICS!
The argument may be settled statewide but will now be disputed at the local
level, where opponents who never wanted to see Massachusetts embrace casinos can
at least try to stop them in their hometowns.
"To me, the biggest issue is that the casinos are predatory. The new
electronic slot machines are called the crack cocaine of the casino industry,"
said EmmaLadd Shepherd, 77, an activist in a group called Quaboag Valley Against
Casinos. "People are spending not only discretionary money. They're spending the
mortgage, the rent, the grocery money."
Opponents, including a coalition of Christian churches that have banded
together, are bracing for battle.
"We're ramping up. ... We're preparing for that fight," said Timothy Paul
Baymon, president of the Council of Churches of Greater Springfield. "They (the
casinos) may have deep pockets, but we have the ears of the people."
The law sets a minimum investment of $500 million - big enough to lift a
local economy but not so big as to push a casino into excessive debt.
Local opposition has felled giants elsewhere in the state. New England
Patriots owner Robert Kraft and Las Vegas magnate Steve Wynn of Wynn Resorts Ltd
wanted to build a casino in Foxborough, about 30 miles (50 km) south of Boston,
but they withdrew their proposal after voters replaced two pro-gambling members
of the town board with opponents.
MATTER OF GEOGRAPHY
In the Boston region, a consortium of the Suffolk Downs racetrack and Caesars
Entertainment Corp is widely seen as the front-runner.
Oh?
The law gives preference
to Native American tribes in the southeastern region, and the Mashpee
Wampanoag's casino proposal took a step forward this month when voters in
Taunton approved a referendum on the plan.
Taunton Gazette Photo | Mike Gay
Daryl Black Eagle Jamieson, vice chair of the
Pocasset Tribe, spoke out against the Mashpee Wampanoag Tribe getting the land
into trust in East Taunton during the Bureau of Indian Affairs scoping meeting
on Wednesday, June 20, 2012.
That leaves western Massachusetts as the wide-open territory.
In 2008, Mohegan Sun took out a 99-year lease on 152 acres of wooded hilltop
in Palmer. It says it has spent some $15 million on rent, engineering and design
studies, and public relations, including a storefront in downtown
Palmer.
Ameristar Casinos Inc in January closed the deal on a $16 million purchase of
a 41-acre parcel in an industrial section of Springfield where it hopes to build
an urban casino.
Hard Rock, Penn National Gaming Inc and MGM Resorts International all have
publicly expressed interest in the region, and others may follow.
The daily Springfield Republican reported on Wednesday that it has received
an offer from a partnership linked to Peter Pan Bus Lines chief Peter Picknelly
to develop a casino on its 152-year-old building on Main Street, so it will
decline to write editorials for or against any possible casino site.
Whether looking to build an urban casino in Springfield or a rural resort in
the hills surrounding the city, gambling interests see opportunity in a down
economy.
The winning project - still at least a year from being chosen by the
Massachusetts Gaming Commission - is expected to create about 2,000 construction
jobs, some 2,000 to 3,000 direct jobs at the casino and an equal number of
indirect jobs.
Hampden County, which includes Springfield and towns such as Palmer, Holyoke
and Brimfield that have attracted casino developers, had an unemployment rate of
7.2 percent in April compared with 5.9 percent for all of Massachusetts. Income
levels were about 27 percent lower, and poverty nearly seven points higher, 2010
census data show.
"The casinos were sold largely as a jobs bill," said John Epstein, part of
the citizen opposition in Holyoke that led Hard Rock to abandon its plans.
"Under any other economic situation, it never would have flown. The crash of
2008 and subsequent turmoil opened the door."
THE BATTLE FOR HOLYOKE
Like their counterparts in Foxborough, voters in Holyoke sent a message via
town hall elections.
While the legislature debated the casino bill, last year's mayoral race in
Holyoke split the community ahead of the November vote.
Incumbent Mayor Elaine Pluta, 68, campaigned in favor of pursuing the
proposal, saying it would be negligent to immediately reject a $500 million
project.
Challenger Alex Morse, then 22, was against it, calling gambling a regressive
tax on the elderly and poor.
With the casino proposal the central issue of the campaign, Morse won, 5,121
votes to 4,513.
"The fundamental question is what do we want to be known for here in Holyoke,
and it definitely isn't casino gambling," said Morse, now 23. "It's our status
as the birthplace of volleyball, the first planned industrial city in all of the
country, cheapest utility rates in all of New England. An economy based on
technology and art."
Holyoke is known as the Paper City for the old paper mills powered by a dam
on a steep drop in the Connecticut River and a canal system in town. Todaypinning its hopes on education and technology. The Massachusetts Green
High-Performance Computing Center, a collaboration of five universities
including Massachusetts Institute of Technology and Harvard, is scheduled to
open this year on a 90,300-square-foot academic research facility near the old
canals.
Prestigious as the computing center may be, it will employ only 13 people
once construction is complete.
The town of Palmer has found it difficult to replace jobs since a Tampax
factory closed 20 years ago, and casino opposition has been muted.
"We need more than 10 jobs in Palmer," said Paul Burns, president of the town
council in Palmer, where the political leadership has actively courted a
casino.
"Each community has to decide on its own," Burns said. "(Morse) is standing
by his guns, just as I'm standing by mine. He was elected on his platform. I've
been re-elected on mine."
The Palmer Casino Study Group determined that
a Slot Barn in Palmer would cost:
$18 MILLION to $39 MILLION
ANNUALLYIsn't that
the same study PAUL BURNS REFUSED TO
DISCUSS PUBLICLY?
Ugly
Cast of Characters and Stupidity: Duh?
New York-based Moody's Investors Services downgraded the credit rating for the operators of the Mohegan Sun resort casino in Uncasville....The default rating fell to Caa3 from Caa2....
Just sprinkle some Fairy Dust and the insolvent Tribe and future bankruptcy of the Town of Palmer will disappear!
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