Third resort casino in Massachusetts is a risky bet
For the most part, Deval Patrick has let the state Gaming Commission do its thing — until now.
As the commission plods along on a third resort license, the governor is weighing in.
“We’re done,” he said in a sit-down interview at the State House earlier this week.
Yes, you heard that right. The governor who legalized gambling said enough is enough, and that the state should not give out the final license in the Southeast region.
To him, the third resort license has in effect already been doled out to the Mashpee Wampanoag, an Indian tribe seeking to open a casino in Taunton. Under the federal Indian gaming law, the tribe, on its own, can operate a gambling palace on tribal land. They don’t need the state’s permission.
“It was never anticipated that there would be more than three destination resorts,” Patrick said.
State law allows for up to three casinos and one slots parlor. This year, the commission awarded licenses to MGM in Springfield, Wynn Resorts in Everett, and Penn National Gaming for a slots complex in Plainville.
If the commission goes ahead with granting a third license and the Mashpees end up clearing the federal hurdles to opening a casino, our nascent gambling empire could fold like a house of cards.
Even this pro-casino columnist is starting to worry about oversaturation, with the potential for a fourth casino in Massachusetts and yet another one just over the border in Connecticut as that state desperately tries to hang onto its high rollers and slot players by building a new gambling playground.
So this is what the commission should do: Hold off on handing out a third license until we know the fate of the Wampanoag.
The tribe’s dreams of blackjack and slot machines have been in the hands of the Department of the Interior. The Mashpee Wampanoag want a casino in Taunton, but the tribe can run one only on sovereign Indian land. The federal government is pondering the tribe’s application to have the casino site taken into trust so that it can legally host tribal gaming. The first request was made in 2007, and then again in 2012 — and they’re still waiting for an answer.
Patrick can’t understand why it’s taking so long.
“I wish the federal government would make the call on the land in trust for the tribe. That uncertainty is problematic,” the governor said. “They’ve given us all kinds of windows. At one point, they were saying by the end of this calendar year. I have bitten my lip more than once, in terms of trying to second-guess some of their decisions in this region. But I’m going to continue to bite my lip.”
In a statement, a spokeswoman from the Department of Interior’s Indian Affairs indicated the tribe’s application remains under review, “with due diligence.”
There’s not much Patrick can do to speed things along. He certainly can’t boss around the five-member state Gaming Commission; it’s an independent body, though the governor appointed chairman Steve Crosby and helped select two other members.
As for Charlie Baker, he has always been a go-slow guy on casinos, and I’ve got to think the governor-elect is in no hurry to award another license.
Crosby, in a phone interview, said the commission is well aware there’s a chance the Commonwealth could have too many casinos if it keeps the Southeast region bid in play.
But, he said, it would be unfair to make towns that are clamoring for a casino and its economic benefits wait indefinitely for one. The state long ago gave the tribe exclusivity to the Southeast — meaning that no one else could open a casino there — but that agreement has since expired.
The commission has been moving slowly on purpose and has extended the deadline for the last license several times. Proposals are now due Jan. 30, and the earliest a license could be granted is the fall of 2015.
Is Crosby comfortable with the possibility of two casinos in one region?
“Absolutely not. It’s not in anybody’s interest. It’s not in the tribe’s interest. It’s not in the commercial casino’s interest,” he said. “It’s oversaturation.”
So far, only one company, KG Urban, has submitted an application. It wants to build a casino in New Bedford. Others are considering bidding but fear competing against the Mashpees.
Under a compact Governor Patrick signed with the tribe, the Indian casino would not have to share gambling revenue with the state if a commercial resort casino opens in the Southeast. That gives the tribe a competitive advantage — a commercial counterpart would have to pay a 25 percent state tax on gambling revenue. The tribe, knowing it was free of taxes, could use the front-loaded savings to offer better comps and build a fancier complex to lure patrons.
The commission is in a tough spot, but going ahead with the final casino license is a bet even professional gamblers would find too risky.
Shirley Leung is a Globe columnist. She can be reached at firstname.lastname@example.org. Follow her on Twitter @leung.