General Assembly To Take Up Third Casino Expansion Bill

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General Assembly To Take Up Third Casino Expansion Bill

With legislative support for casino expansion uncertain, the General Assembly's finance committee will dig into revenue implications for the state in the third gambling expansion bill to be considered by state lawmakers this session.

Sen. John W. Fonfara, D-Hartford and co-chairman of the finance, revenue and bonding committee, said Thursday the bill would open up any potential expansion to more operators, in addition to the plan by Foxwoods and Mohegan Sun to establish a "satellite" casino in East Windsor.

The plan by the Mashantucket Pequots and Mohegans is aimed at keeping gambling dollars — and Connecticut's share of that revenue — and jobs tied to the gaming industry from flowing to a $950 million casino complex now under construction in Springfield.

"We don't know if that is the most effective way to protect Connecticut and advance our interests," Fonfara said. He said the committee will take a close look at what other states, particularly Massachusetts, are requiring of casino operators.

Fonfara had confirmed a month ago that the finance committee would consider a casino expansion bill and focus on revenue for the state. The bill, now drafted, will be considered at a public hearing Monday at 11 a.m. in room 2E of the legislative office building in Hartford.

The finance bill is the third piece of proposed casino expansion legislation to be considered by state lawmakers this year. Two bills — one supporting the tribes' plan for East Windsor and a competing bill that also would open up the process to more potential operators — both passed out of the public safety and security committee last month, neither with a strong mandate.

A broad cross section of public safety committee members said they were uncomfortable with recommending legislation when there were too many unanswered questions. The questions included the impact on a decades-old, slot revenue-sharing agreement that gives the tribes exclusive right to operate casinos in Connecticut and whether another location in the state might be better.

Rep. Jason Rojas, D-East Hartford and co-chairman of the finance committee, said in a text Thursday that the two bills would likely be referred to finance for a vote.

"It would be helpful to committee members to have the benefit of a hearing on an issue of this magnitude before having to take action on either or both of the bills passed out of public safety," Rojas said.

Last month, Attorney General George Jepsen warned that giving the tribes the exclusive opportunity to expand could be challenged in court. And the revenue-sharing agreement, known as the "compact," could be broken, jeopardizing the tribes' monthly payments to the state — expected to be $267 million this year — even if it was the tribes doing the expanding, Jepsen said.

The Mashantucket Pequots and Mohegans last week met with legislators and offered to guarantee the state's 25 percent share of slot revenue. Fonfara said Thursday he took that as a sign of how competition in casino gambling could benefit the state.

Even so, some legislative leaders are giving casino expansion a 50-50 chance this session.

The prospect of losing revenue is a sensitive issue at the Capitol given the state's budget woes. If another operator was allowed to expand, it would certainly break the compact. But some argue a casino in another region of Connecticut might ultimately produce more funds for state coffers.

The finance bill calls for competitive bidding led by the state commissioners of consumer protection and economic and community development, a process that could begin no later than Jan. 1.

A casino operator must invest at least $500 million, compared with $300 million in the public safety bill. The tribes, which formed a joint venture, MMCT, for the East Windsor proposal, say they will spend $200 million to $300 million.

One other key difference is the finance bill would require the state reap 35 percent of all slot and table game revenue, compared with 35 percent of slot and 10 percent of table games. The tribes have proposed 25 percent of slots and 25 percent of table games in the public safety bill.

Other provisions in the finance bill include a lower, $50 million licensing fee, compared with $250 million in the public safety bill. There also would be required revenue payments to communities that border the town or city where a casino would be located.

Fonfara said it also is possible that a study could be required as part of any expansion. A move for such a study in last year's legislative session did not make it out of committee.

MGM, the developer of the Springfield casino, has played a key role in stoking the debate over casino expansion in Connecticut. MGM has said southwestern Connecticut would be a more lucrative site for a casino. Legislators from the Bridgeport area have urged that the area at least be considered.

In 2015, the legislature voted to allow the Mashantucket Pequots and Mohegans to search for a site in the Hartford area to combat the competitive threat of MGM in Springfield. But the tribes had to come back for final approval to expand off their southeastern Connecticut reservations, a move that sparked the competing bills.

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