"Hey, we have this big pot of money on the table. What do we do with it?" That’s what the members of two Maine Indian Tribes were asking financial advisers last week.
Of course, the money hasn’t appeared yet. In fact, the people of Maine haven’t, as yet, voted their approval for a proposed $650 million casino in Sanford. That vote won’t take place until Nov. 4.
But, members of the Penobscot Nation and the Passamaquoddy Indian Tribes have asked the A.G. Edwards firm to advise them on how to spend the money when it does become available.
According to Penobscot Nation Tribal Governor Barry Dana, the tribes had a questionable experience in the past and don’t want to repeat those errors. In 1980, the tribes received $81.5 million in a settlement on the Maine Indian Land Claims. A good chunk of the money was lost in bad investments. Dana said they want to avoid those mistakes when the money rolls in from the new casino.
Critics have noted that the casino, if approved, will not come under the jurisdiction of the Indian Gaming Regulatory Act. The tribes were removed from that jurisdiction with the 1980 settlement. Thus, say the critics, the casino will be a commercial operation with most of the profits going to the casino developers, Tony Marnell and Jay Barrett, the team that built and operated the Rio Suites Hotel/Casino in Las Vegas until that property was sold three years ago to Harrah’s Entertainment Inc. (HET).
That the Indians are confident of a ballot victory was shown on Saturday when the casino supporters held a job fair in Sanford. Members of a support group called "Think About It" set up tables at a vacant Emery Street mill to provide information on the various jobs to be offered, jobs such as waiters, card dealers, security guards and maintenance workers.
Ann Simmons, a job counselor, said she believed the compensation and benefits for the jobs being offered would equal or surpass some of Maine’s best paying jobs with the average worker being paid between $25,000 and $35,000 including tips.
Although the ballot focus will be on the Sanford casino, another gambling question will be on the Nov. 4 ballot, a question that is of major importance to Las Vegas gaming entrepreneur Shawn Scott.
The second ballot question seeks voter authorization to allow slot machines at Maine’s commercial horse racing tracks with certain conditions. Affected will be two harness racing tracks ”” Scarborough Downs in Portland, and Bangor Raceway in city-owned Bass Park in Bangor.
Scott, who bought Delta Downs in Louisiana for $10 million and later sold the property to Boyd Gaming Corp. (BYD) for $131.5 million, has an option to acquire Bangor Raceway from the city and to convert it into a "racino" should the voters favor the referendum.
Through his Capital Seven LLC, Scott says the racino represents an economic jolt for both the city and for Maine’s harness racing industry. He plans to spend some $30 million to upgrade the facility and to install 1,500 slot machines at the track.
Scott now owns Vernon Downs in upstate New York and is in the process of converting that harness track to accommodate 1,500 video lottery machines authorized by the state of New York.
A new concept
Magna Entertainment Corp. (MECA) has unveiled its plans to build its "flagship of a new generation of racetracks that will be built around the country and around the world."
The new $130 million facility, Dixon Downs, will be built in Dixon, Calif., Many believe it will be a replacement for Bay Meadows racetrack. It will accommodate 6,800 fans. The track will be one and one-eighth miles in circumference and include a one-mile turf course. There will be stalls for 1,600 horses and dormitories for backstretch employees.
However, the project actually will be a "destination entertainment complex," with a 200-room hotel, conference center, retail outlets and the "Finish Line Pavillion" which will contain restaurants, meeting rooms, and a performing arts stage, the company said. Completion for the entire project is expected to be in 2007.
Magna Entertainment currently operates racing at Bay Meadows and Golden Gate Fields in Northern California and Santa Anita in the Los Angeles area. Also, it has another 10 tracks that it operates in various parts of the U.S. and Canada.
While disgraced penny stock manipulator Bob Brennan is serving hard time at a federal prison in Fort Dix, N.J., his remaining assets, estimated to be about $39 million, will finally be distributed to his creditors.
A bankruptcy court has ordered the distribution to investors who were bilked by the New Jersey con man who used a television commercial showing him at the control of a helicopter to solicit business for his First Jersey Securities or Hibbard Brown & Co.
Distributions will be made by a bankruptcy trustee and by the Securities and Exchange Commission, although it was conceded that investors would receive only a fraction of their losses.
The bankruptcy trustee will make payments to those who invested in stocks proposed by Hibbard Brown while the SEC settlement involves those who purchased shares in Rampart General, Quasar Microsystems Inc. Sovereign Chemical & Petroleum, Sequential Information Systems and TransNet Corp.
Political leaders in Maryland had one message for casino company lobbyists over the weekend: "Go Home."
During the past couple of weeks, stories out of Maryland have focused on some of the country’s largest gaming companies ”” such as Harrah’s Entertainment Inc. (HET), Park Place Entertainment Corp. (PPE) and Wynn Resorts Inc. (WYNN) ”” which were lobbying for casino licenses should the state go in that direction.
Most of the gaming discussion, during the last Maryland legislative session, was taken up by Gov. Robert Ehrlich’s proposal to permit slot machines at the state’s racetracks. The proposal passed the Senate but never received action in the House of Delegates.
But in a gathering of influential political leaders last week, all participants took the same position. That was that there is no support at all for full-scale casinos. Any efforts to the contrary, said a spokesperson, "will have casino companies just wasting their time and money."
At a meeting of a gaming study committee last week a representative of Ameristar Casinos Inc. (ASCA) made a pitch for a riverboat casino near the downtown Baltimore area. However, if only slots locations were authorized, the company would be interested in that project, the ASCA representative indicated.
Still to be resolved, said the governor, are budget deficits for the next few years. He asked that other state officials consider whether track slots or some other form of gaming expansion should be approved.