Bridgeport casino, internet gaming proposed in new bill

The gambling floor at Foxwoods Resort Casino.

The gambling floor at Foxwoods Resort Casino.

Bob Child/ST

New proposed legislation would vastly expand the gambling monopoly of the state’s two Native American tribes by authorizing them to build a $100 million casino in Bridgeport and operate sports betting at casinos and other locations.

Formerly opponents, lawmakers from Bridgeport, eastern and north central Connecticut have united behind the plan. The bipartisan bill represents the latest step in Bridgeport’s nearly three-decade pursuit of a casino development. It does not yet have the support of Gov. Ned Lamont and faces other obstacles, like the threat of legal action, to passage and implementation.

The bill allows the Mashantucket and Mohegan Pequot tribes, who run Foxwoods and Mohegan Sun casinos, to keep their plans for an East Windsor casino along I-91 — something Lamont hoped the tribes would abandon.

The bill would also authorize internet gaming run by the tribes and internet lottery sales run by the Connecticut Lottery Corporation, as well as sports betting in person and online. It would send millions more in revenue to the state and give new municipal grants of $750,000 to Fairfield, Hartford, New Haven, Norwalk, Stratford, Trumbull and Waterbury.

“This is historic and has been a long-anticipated plan that now will be realized because of our joint efforts to place Connecticut back on the map,” said Sen. Dennis Bradley, D-Bridgeport.

Rejecting a Bridgeport casino proposal from MGM Resorts International, the bill further empowers the tribes and their casinos, which represent one of the state’s largest employers and largest single taxpayer. The tribes have a compact with the state,dating to the early 1990s, that gives them an exclusive right to operate casino games, in exchange for them paying a quarter of their slot revenue to Connecticut.

“We've long believed that the best way forward for the state is to protect and preserve the historic partnership with our two tribes, one that's generated more than $8 billion in revenue for Connecticut,” said Rodney Butler, chairman of the Mashantucket Pequot Tribal Nation, and James Gessner, interim chairman of the Mohegan Tribe, in a joint statement.

Eleven Democrats and Republicans — all either from Bridgeport or the areas near the tribes’ casinos — indicated their support for the legislation Wednesday.

Previously, this group was “at odds,” said Sen. Cathy Osten, D-Sprague, with one side defending the tribes’ existing casinos and the other pushing for a commercial casino in Bridgeport. The acrimony was on display at a public hearing in February when Bridgeport lawmakers and Osten loudly accused each other of trying to steal jobs.

“It was five years of being on opposite sides,” said Rosario. “There was a little bit of bad blood and things that were between us legislators that ruffled a lot of feathers.”

But that’s changed now that the tribes have expressed interest in opening a casino in Bridgeport.

The new coalition of lawmakers hope its bill will be voted on in a special session before 2020. That will be up to the governor and legislative leaders, who have received the bill but were not involved in crafting it.

Best deal?

Other lawmakers worry it is not the best deal for the state as whole.

“My initial blush is it’s one-sided,” said Rep. Joe Verrengia, D-West Hartford, who co-chairs the legislative committee that oversees gambling with Bradley. “The proponents of this bill are the same proponents who claimed that the East Windsor casino was a jobs bill. And we haven’t seen that impact. And now it’s the same spin.”

The legislation follows a frenzy of negotiations in the last week of the legislative session between the tribes and Bridgeport’s delegation and mayor to deliver a casino for the Park City. In June and July, lawmakers from Bridgeport, Eastern Connecticut and the East Windsor area continued talks to produce this bill.

Both this bill and draft legislation from negotiations in June highlight the Bridgeport delegation’s dramatic shift away from their previous strategy: supporting an open bidding process to deliver a commercial casino. The shift spurns MGM, which has lobbied for years for the right to build a $675 million proposal on Bridgeport’s waterfront but was stymied by the tribal compact and its defenders.

“I think the state of Connecticut should honor its commitment to the tribes,” said Sen. Paul Formica, R-East Lyme. “Is gambling the answer to Connecticut’s economic woes? No. If it creates jobs in Bridgeport, I think we should try to help Bridgeport.”

Osten and other tribe supporters have sharply criticized MGM, saying it has no intention to build in Bridgeport but only wants to fight off the East Windsor casino, which is positioned to blunt the impact of MGM’s $1 billion new Springfield development. The Tribal Winds casino in East Windsor is not yet under construction.

MGM has countered that it intends to build in Bridgeport, although it now owns Empire Casino in Yonkers, N.Y. MGM promised to create 7,000 jobs in Bridgeport. The tribes estimate their facility would produce at least 1,000 construction jobs and lead to 500 permanent jobs at the casino.

Rosario said the new plan represents what is “realistic and achievable.”

“We want to do it right size,” he said.

Encourage development

Proponents hope the tribes’ $100 million investment will encourage a private developer to build a hotel resort nearby — but there is no guarantee of that. Nor does the bill force the state or city to contribute funds to the project, as previous drafts of legislation did.

“What are they going to build for $100 million?” Verrengia asked. “The main attraction to a casino is not gaming activities. The idea of building a $100 million whatever you want to call it raises a red flag.”

Under their proposal, the tribes would pay 25 percent of their slot and table revenue at the Bridgeport casino to the state, resulting in $15 million annually, they estimated.

Additionally, the tribes would pay a tax of 8 percent on sports wagering and 10 percent on online casino gambling. The tribes could conduct retail sports wagering at their four casinos and at four “entertainment zone facilities;” one on-site at the Bridgeport casino, one in Hartford and two in other towns not yet chosen. People could also play e-sports at the entertainment zones. These facilities would create 100 jobs each, the tribes said.

The tribes would each be able to operate a mobile app for sports betting.

Verrengia worried the tax rate on sports wagering and online gambling was not as high as rates in other states. The legislation would also allow the tribes to contribute this new revenue toward their mandatory minimum payment to the state of $160 million annually. Recently, tribal payment to the state based on slot revenue has been roughly $240 million.

“With the new millennials, that slot play is decreasing and really where the jackpot is going forward is the online gaming and in addition to that, sports betting,” Verrengia said. As a result, he said, he worried the tribes would not pay the state much more than they are now.

Other tribes in other states contribute far less in tax revenue to their states, countered Osten.

“When it comes to our state’s gaming industry, we’ve got two simple choices — do nothing and let the increase in competition continue to erode our state’s revenue, or take action and create new jobs and new sources of revenue,” said Rep. Chris Davis, R-Ellington.

The proposal is a “starting point,” said Rosario. It needs approval from the legislature and the governor and the parts amending the compact require sign off from the U.S. Department of Interior.

Rosario and Osten said some provisions of the bill may change before final passage.

The bill hands the exclusive right to conduct sports betting to the tribes, although the Connecticut Lottery Corporation and off-track betting operator Sportech have advocated for a slice of the action. Sportech has indirectly threatened legal action in response to earlier bills that excluded it from sports betting.

“Moving forward, we’ll see what happens with the off-track betting,” said Osten. “I know there is a relationship between the tribes and off-track betting and I’m certain there wll be some movement through that relationship.”

MGM previously filed a lawsuit against the state over approval of a casino by the tribes in East Windsor, withdrew the lawsuit and has said it will file it again. Conversely, if the state supported a bidding process for a commercial casino like MGM wants, the tribes have threatened to withhold their payments to the state.

Formica, Osten and Rosario all agreed that litigation was inevitable, so the state should move forward with their plan.; Twitter: @emiliemunson