MGM recently received the go-ahead to construct the first operating commercial casino in Massachusetts. Those plans could be axed, however, if critics behind the recent “Repeal the Casino Deal” movement have their way. Gambling opponents are growing in number in the Bay State, and enough signatures have been collected by the group to place the future of Massachusetts gambling in question.
Due to the strong-willed campaigning efforts of the folks at Repeal the Casino Deal, a 2011 law that provides for the creation of three casinos and one slot parlor in the state will be revisited next November by voters. At that time, people all over the state will have the chance to repeal the three-year-old law. The vote could have serious implications for MGM's future in Massachusetts.
Under normal circumstances, MGM would have 30 days after receiving the go-ahead to pay an $85,000 million non-refundable license fee. Because the referendum vote won't occur until November, however, the casino giant has received permission from the Massachusetts Gaming Commission to hold off on that payment until the fate of gambling is determined.
If the referendum is defeated in November, MGM will then shell out the licensing fee and construction will begin as planned. If the referendum is approved, gambling in Massachusetts will face a dubious future. Residents are divided on the issue, but a new poll from Suffolk University and the Boston Herald indicated that only 37 percent are in favor of legalized gambling. According to the data, 57 percent oppose the construction of a casino and 15 percent are undecided. If these figures portray an accurate picture of how residents really feel, November could bring bad news for MGM and others who support the development of the gaming industry in Massachusetts.
Recent Poll: A Drastic Change in Attitude
The latest poll results suggest that Massachusetts residents have undergone a drastic change in attitude about gambling in their state. The same poll was given last February with results that supported the establishment of legal gambling in the region. At that time, only 37 percent opposed casino construction and 51 percent supported it. If both polls are accurate, the state's attitude toward gambling has essentially flip-flopped in a very short period of time.
Hypothetical Casino: MGM Springfield
If MGM has its way, its new facility will be built in Springfield, a college town with a population of around 155,000 townspeople and 20,000 students. The Springfield metro area encompasses significantly more people, with a population that hovers around 700,000. MGM Springfield would compete with the state's casino cruise ship, the Ocean Club of Gloucester, which offers guest passengers nine table games and over one hundred slot machines. Riverboat casinos and other cruise ship gambling venues are legal in the US because gaming takes place offshore, not on federal land.
New England Casinos
Massachusetts is part of the US territory commonly referred to as New England. The New England states also include Connecticut, Maine (read more), New Hampshire, Rhode Island, and Vermont. As a region, New England has no shortage of casinos. In fact, it is home to the largest casino in all of the US, the Foxwoods Resort Casino in Connecticut. The resort actually operates a total of six casinos on its campus and is run by the Mashantucket Pequot Tribal Nation.
Because tribal gaming is governed by different federal laws than commercial gaming, it is still legally possible for tribal facilities to dot the Massachusetts gaming landscape. In 2012, the governor signed a compact with the Mashpee Wampanoaq Tribe. This tribe owns some land in the town of Taunton. In order for the land to be gambling-ready, the tribe must register the property with the US Department of Interior. This past January, the compact was approved by the US Bureau of Indian Affairs.
According to the compact, the Mashpee tribe would pay 21 percent of their revenue to the federal government if no other casinos are opened in Massachusetts. If MGM's casino becomes a reality after the referendum vote this November, however, they will only have to share 17 percent of their revenue with the government.
The Future of Penn National Slot Parlor Also in Question
The 2011 law that provides for up to three casinos in Massachusetts also permits one slot parlor. Plans for that facility are already in the works. In March of 2014, Penn National Gaming began construction of the state's only legal slot parlor. This parlor, to be called the Plainridge Park Casino, is located right next to the Plainridge Racecourse in the city of the same name. The project will cost over $200 million dollars and will offer over 1,000 slot machines, live racing venues, and other entertainment. Several restaurants and bars, some of them upscale, are also planned for the facility, which is scheduled to open in 2015.
Eric Schippers, a senior VP for Penn National, said his company is “disappointed” with the recent court ruling. He added, however, that he is confident the law will stand as is after the November vote. Schippers cited the many economic benefits of keeping the law as it currently is: Thousands of jobs for Massachusetts residents, millions in revenue for the government, and the recapture of gambling revenue that is currently lost to other New England states. Schippers said that his construction project remains “full steam ahead” and that he has faith the Penn Gaming complex will be ready to go next June.
It's a precarious time for commercial gambling businesses to be making their resources vulnerable in Massachusetts. MGM and Penn Gaming are both taking calculated risks by continuing their plans to set up shop there. In spite of various polls, no one will know the final determination until November, when voters ultimately decide whether casino gambling should be legal in the state.