MGM Resorts International is developing a $950 million casino resort known as MGM Springfield in Springfield, Massachusetts and construction is progressing as per plan at the moment. MGM Springfield has faced a number of challenges in the lead up to obtaining a casino license and getting its development plans approved.
One of those challenges has come from the neighboring state of Connecticut which decided to approve a third casino license for a satellite casino. The casino license was awarded to a joint venture company that was formed in partnership with the Mohegan Sun and the Mashantucket Pequot tribes. Connecticut legislators were concerned that the MGM Springfield facility would poach Connecticut gamblers by luring them to cross the state border and getting them to spend their gambling dollars in Massachusetts.
The third tribal casino in Connecticut was expected to keep gambling dollars within the state by giving local gamblers a new casino to gamble at. The tribal casino was also expected to create hundreds of new jobs and generate additional gaming taxes for the government which was looking for new income streams to boost its budget. MGM Springfield was not happy with the licensing of the third tribal casino as they were banking on consistently attracting out of state gamblers to the casino resort and the third tribal casino would hinder those plans.
MGM Resorts went the legal route opposing the fact that Connecticut legislators had violated the state gaming compact by directly awarding the casino license to the tribes. MGM alleged that the state’s gaming regulator should have asked other gaming operators who were interested to submit a proposal and then awarded the casino license to the operator with the most attractive gaming proposal. Connecticut lawmakers and the state gaming regulator have battled it out with MGM but as of now it appears that biggest hurdle is to get legislators within the state to back the third casino and finalize a suitable location for its development.
There were initially 5 locations proposed for the third casino site and earlier this year, that was narrowed down to East Windsor. The tribes were happy with the East Windsor location as the Mayor was happy to welcome the development of a new casino and the creation of thousands of jobs for the city. However the site location has been opposed by other legislators, especially from Hartford as they believe there are other locations in Connecticut that are much better for the third casino.
MGM Resorts has also been lobbying hard to get legislators to reconsider the East Windsor site stating that Connecticut could bring in more gaming revenue if they decided to develop the third tribal casino in another location. Legislators have introduced a new bill known as the ‘MGM Bill’ which asks legislators to reconsider the third casino’s location and also to give other gaming operators the opportunity to send in a proposal and outline their interests of developing a third casino in Connecticut.
Current gaming law in Connecticut allows tribal casinos the exclusive right to operate slot machines in the state and has been the case for a number of years. Slot machines generate a significant amount of gaming taxes for Connecticut and could provide the state up to $267 million based on analyst estimates in 2017. Connecticut receives 25 percent of all slot machine revenue and this contributes significantly to the state budget.
The state budget deficit as of now stands at $1.5 billion and legislators cannot afford to lose any slot revenue gaming taxes. That could happen if the new MGM Bill gets approved and new gaming operators are allowed to enter Connecticut’s gaming industry. The two tribes along with MGM Resorts have invested more than a million dollars in their campaign for and against the proposed third tribal casino.
Connecticut legislators currently appear to be 50-50 in favor for and against the MGM Bill. There is no certain timeline as of now as to when a decision will be made and what that decision will most likely end up being. MGM Springfield in the meantime is not wasting anytime with its construction phase and is proceeding as per plan. The casino is expected to be home to 3,000 slot machines, a poker room with a VIP gaming area and 100 gaming tables. Should everything go as per plan, the casino is expected to open towards the end of 2018.