Massachusetts casino process slow, deliberate year in first year

Nov 26, 2012 9:15 AM

When Gov. Deval Patrick ended years of contentious debate over expanded gambling by signing a bill authorizing up to three resort-style casinos and a slots parlor, he warned against expecting any quick economic windfall.

One year later, such caution appears warranted. While there has been some progress in the 12 months the law has been in effect, there also have been some setbacks.

Several casino proposals have been offered, while other trial balloons have been shot down. A new state gaming commission with broad oversight of the law has held dozens of meetings and won praise for transparency, but it has yet to appoint an executive director or finish writing key regulations. Western Massachusetts — and Springfield in particular — has been a hotbed of casino interest, but competition has been slow to take shape in other parts of the state. Plans for a tribal casino envisioned under the law are in limbo.

The bottom line is that casino licenses are unlikely to be awarded until early 2014, and it may well be 2017 before gamblers are actually placing bets in sparkling new resorts. For some, that’s too long to wait for the estimated $400 million in annual state revenue and thousands of temporary and permanent jobs the casino industry could bring.

‘‘We would like to see it move much more quickly,’’ said Frank Callahan, president of the Massachusetts Building Trade Council, which represents unionized workers in construction trades. ‘‘There are a lot of jobs at stake.’’

Callahan is among those urging the commission to speed up the licensing process, perhaps by borrowing from the best practices in nearly two dozen other states that already have commercial gambling facilities. The council has cited an American Gaming Association survey showing that nearly all of those states moved from legalization to opening of casinos in less time than is projected in Massachusetts.

Stephen Crosby, whom Patrick appointed to lead the five-member gaming commission, says he understands the complaints. State and local governments are eager for tax revenue and economic development, unions are seeking jobs and ‘‘people want to gamble,’’ he said. But he said he won’t allow the panel to be pushed into hasty decisions, citing a complex and exacting law and policy questions that have proven even more challenging than anticipated.

‘‘We are taking the amount of time that is appropriate to take,’’ Crosby said in an interview. ‘‘We have been very clear that we are not going to sacrifice care for speed.’’

For example, the commission is allocating almost a full year to reviewing the backgrounds and qualifications of would-be casino developers, he said.

The law allows the panel to award one resort casino license in eastern Massachusetts and one in the western part of the state, as well as a single license to operate a slots parlor. The jockeying for the western license has been lively. Three companies — Ameristar Casinos, MGM Resorts International and Penn National Gaming — have offered proposals for Springfield, and Mohegan Sun is pursuing a plan in Palmer.

By contrast, only the Suffolk Downs racetrack in Boston has entered the bidding for the eastern Massachusetts casino license, and the Plainridge harness track in Plainville is the only formal suitor for the slots license. That could change, as Chicago-based Rush Street Gaming has stated, without specificity, its intention to pursue a casino, and the owner of a former dog racing track in Raynham has publicly stated interest in a slots parlor.

The situation is also cloudy in southeastern Massachusetts, the third region where a resort-style casino would be allowed, and the one region where a federally recognized Indian tribe was given a leg up in the process. The Mashpee Wampanoag tribe, which has proposed a casino in Taunton, successfully negotiated a casino compact with Patrick’s administration, only to have it rejected by the U.S. Interior Department. The governor and tribe have promised to reopen negotiations with an eye toward addressing Interior’s complaint that the state was seeking too large a share (21.5 percent) of gaming revenue from the tribe.

Crosby said he hopes to see more competition emerge in eastern Massachusetts. But he also noted the law is strict, essentially giving cities and towns veto power over casinos in their communities. One potential competitor, Las Vegas casino operator Steve Wynn, suspended a proposal for a casino in Foxborough in the face of local opposition.

‘‘The system is working the way the system is supposed to work,’’ Crosby said.

Yet the first year has not been without missteps. In May, the commission’s choice for interim executive director, Stanley McGee, declined the offer after the resurfacing of an allegation that he sexually assaulted a 15-year-old boy in Florida in 2007. Crosby called the episode a ‘‘learning experience’’ for the panel. A permanent executive director has yet to be named.

While some ardent casino backers are disappointed with the commission’s deliberate pace, the panel gets high marks from former Attorney General Scott Harshbarger, one of the state’s leading opponents of casino gambling. He credits the panel for taking its time and not succumbing to pressures to accelerate the process.

‘‘I think they deserve a lot of credit for avoiding the push to get this up and running at all costs,’’ said Harshbarger, who predicted the gambling law would bring corruption and other social ills.

Harshbarger said he was impressed by the commission’s openness — it has provided live webcasts of most public meetings — and the apparent absence of any undue influence from powerful elected officials.

Sen. Stanley Rosenberg, D-Amherst, one of the principal architects of the casino bill, said the law is unfolding mostly as expected, with one surprise being the level of interest in western Massachusetts compared with the rest of the state. He praised the commission while suggesting it might consider ways of shortening the timeline for licensing.

Don’t expect, however, to see any tinkering with the law itself, barring discovery of some catastrophic flaw.

‘‘I hope that there are no fatal points, because short of a fatal point, let it play out,’’ Rosenberg said.

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