Casino bill would revoke East Windsor license, set up competition

A photo of a proposed MGM casino is on display as the community group East End NRZ meets with executives from MGM about the latter's planned casino in Bridgeport, Conn., on Wednesday Oct. 18, 2017. A photo of a proposed MGM casino is on display as the community group East End NRZ meets with executives from MGM about the latter's planned casino in Bridgeport, Conn., on Wednesday Oct. 18, 2017. Photo: Christian Abraham / Hearst Connecticut Media Buy photo Photo: Christian Abraham / Hearst Connecticut Media Image 1 of / 3 Caption Close Casino bill would revoke East Windsor license, set up competition 1 / 3 Back to Gallery

Supporters of a casino in Bridgeport rolled out a bill Tuesday that would revoke the East Windsor license granted last year to the Mohegan and Mashantucket Pequot tribes and replace it with a competition for proposals for a single casino costing at least $500 million.

The bill calls for bids by Jan. 1, which would have to include a deal with a city or town, complete with a referendum, anyplace in Connecticut. If adopted, it would empower the state commissioners of consumer protection and economic and community development to recommend one winner by April 2, 2019.

The legislature could then vote on whether to approve a casino license for the winner, which would pay the state 25 percent of all gambling revenues plus 10 percent of slot machine revenues, the latter amount dedicated to school aid.

With the two tribes certain to oppose the bill as vigorously as they fought for the East Windsor license last spring, the bill will set up yet another battle in the Legislature — this time complicated by delays at the East Windsor project and a new debate over sports betting.

And this time, MGM Resorts International has a proposal for a $675 million casino on Bridgeport Harbor, which the Las Vegas-based company announced in September. That gives MGM and its supporters more leverage to talk about jobs in the same way the tribes talked about jobs last year.

The new bill dovetails with MGM’s proposal. For example, it envisions a payroll of at least 2,000 people, a $50 million fee paid to the state and at least $8 million a year to towns, all of which MGM said it would meet. It also calls for a training center in New Haven, as MGM said it would open.

But the bill’s sponsors, from the Bridgeport and New Haven delegations in the General Assembly, say the goal is to set up a fair and open contest for a commercial casino that favors no one. They say the steps outlined in the bill conform with industry standards for licensing commercial casinos in all other states, including Massachusetts, where the tribes competed.

“A competitive process will bring Connecticut the best deal, in terms of jobs, economic development, community benefits, and support for our local businesses,” said Rep. Chris Rosario, D-Bridgeport, in a written statement. “This process will let every developer with an interest -- whether it is MGM or the Tribes or anyone else -- give it their best shot.”

The tribes, operating jointly as MMCT, have ridiculed the “open contest” option and called efforts by MGM to gain a Bridgeport license an ill-advised attempt to undo a 25-year-old compact between the state and the tribes. Under that compact, Connecticut receives 25 percent of slot machine revenue, an amount that peaked at $420 million in 2007 but is now about $270 million and is expected to fall below $200 million after MGM Springfield opens later this year.

The new bill pits regions of the state against each other, also stiring gambling opponents such as Sen. Tony Hwang, R-Fairfield, and Sen. Mae Flexer, D-Killingly.

It will be all the harder for supporters to win passage because it doesn’t just start a competitive process, but also nixes last year’s closely fought bill for an East Windsor casino — which was larded with 11th-hour “sweeteners” for various groups, to win votes.

MGM is not likely to support a bill that recognizes the MMCT plan as legal. The company spent $3.8 million lobbying and advertising in Connecticut last year, largely trying to create an open competition and halt East Windsor on legal and political grounds.

What the tribes want is an exclusive right to jointly operate commercial casinos wherever the legislature decides to open them — building on the $7 billion they’ve paid into state coffers. They targeted north central Connecticut in order to pick off customers driving up I-91 to the $950 million MGM development with the claim that their casino would help save thousands of jobs.

In 2015, the tribes lobbied lawmakers unsuccessfully for an additional casino license in Fairfield County. They jumped back into the Bridgeport fray on Dec. 6, the very day MGM chairman and CEO Jim Murren, a Bridgeport native, was in town to address the business community.

“If circumstances have changed and there is now real interest in putting a casino in Bridgeport, we want to be a part of that discussion,” the two tribal chairmen said in a letter to legislative leaders that day.

Great, MGM and its supporters said. The bill filed Monday creates exactly that discussion — which, they say, should have happened last year.

Rep. Joe Verrengia, D-West Hartford, co-chairman of the committee that oversees gaming, has long favored an open process. He’s not a co-sponsor of the new bill but said he supports most of its provisions. “I support a gaming policy that puts Connecticut on a pathway of stability and economic prosperity,” he said.

MGM continues to lobby hard for its plan, now in the form of this bill, piling up support from the mayors of Bridgeport and New Haven and, as of Tuesday, the UNITE HERE union in Connecticut, which represents tens of thousands of hotel workers in Las Vegas.

At the state Capitol, many lawmakers remained guarded as MMCT continued to portray the MGM bid as job-killing because it would the existing tribal casinos.

Shaping that debate is a court battle that could tie up East Windsor — or any commercial license the state gives the tribes in a no-competition deal — for years. First, the tribes must win federal approval to amend the compact, which is now in court; then MGM will refile a federal lawsuit claiming the deal denied it the right to bid.

Then there’s the money issue. Giving MGM or anyone other than the tribes a license would mean losing at least $160 million as year, much more if East Windsor opens. But at some point, as the state’s take from Foxwoods and Mohegan Sun casinos shrinks, as gambling migrates more to cities and as Connecticut watches other states plan more casinos, the state might be better off forsaking the compact money in favor of a sweeter take from commercial interests.

Bridgeport could raise an estimated $300 million a year for the state.

By June, the U.S. Supreme Court is likely to clear the way for states to sanction sports betting. If the tribes claim they have an exclusive right to that, we could see yet more lawsuits over the compact.

Another question is whether the tribes would be able to line up money for both the $300 million casino in East Windsor and one costing at least $500 million someplace else. MMCT has yet to begin work in East Windsor but said it will start demolition of an abandoned movie theater at the site soon.

So we’re staring at a stalemate.

MGM’s Bridgeport proposal, across the water from Steel Point, stands as the state’s best casino site. It taps into the New York market an hour away, on open land just off I-95 that’s zoned for big development, offering jobs to an area that needs them. Now the same arguments we heard last year about East Windsor will echo for Bridgeport.

“This is a real opportunity for us to maximize jobs and revenue,” said Rep. Toni Walker, D-New Haven, co-chairwoman of the powerful appropriations committee. “It is an opportunity we cannot afford to let go by.”