Mass. casinos pose tough new competition in region

Posted Nov. 27, 2011, at 7:28 p.m.

HARTFORD, Conn. — The race is on for more casinos in southern New England as Connecticut and Rhode Island look to expand to keep up with huge competition expected from Massachusetts, now that the Bay State has jumped into the business.

Connecticut’s Mohegan Sun is seeking to build a casino in Palmer, Mass., as other casino developers look at Springfield and Holyoke as competitors for a western Massachusetts site. And Rhode Island voters will be asked next year to approve a ballot question on whether to turn a slot parlor into a casino.

Massachusetts Gov. Deval Patrick signed legislation Tuesday authorizing the greatest expansion in gambling in the state since the lottery was established 40 years ago. The new law authorizes up to three competitively bid casinos and one slots parlor. It caps a five-year effort that backers say will create thousands of jobs and generate hundreds of millions in revenue.

A slot parlor could be operating in two years, while it could be four years before destination resort-casinos are in business, said Massachusetts state Sen. Stephen Brewer, chairman of the Ways and Means Committee and a casino supporter.

Mitchell Etess, chief executive of the Mohegan Tribal Gaming Authority, which runs the Mohegan Sun in eastern Connecticut, praised Massachusetts’ foray into casino gambling. It’s a double-edged sword for the Mohegan Sun, competing with it while also giving it the opportunity to seek permission to build a casino in Palmer, Mass.

“We’re really glad to see this taking place,” Etess said. “We believe the New England market can sustain the three casinos and slots in this legislation.”

Connecticut officials aren’t as certain. State government does not have dollar estimates related to the impact from new casinos to the north, but expects competition to be “negative for Connecticut’s casinos,” Gian-Carl Casa, spokesman for the state Office of Policy and Management, wrote in an email.

Until details are available about the location, size, and type of entertainment at casinos in Massachusetts, “we won’t know the magnitude,” he said.

Foxwoods and Mohegan Sun paid $342.3 million in slot machine contributions to Connecticut in the budget year that ended June 30. That was down 2 percent from the previous year due to competition from New York and elsewhere and the weak economy.

Casinos looking to open in the region do so at their own peril, said Connecticut state Sen. Eileen Daily, co-chairwoman of the legislature’s Finance, Revenue and Bonding Committee.

“There’s a limited amount to go around,” she said.

Rhode Island Gov. Lincoln Chafee said the state gets more than $300 million a year — the third-largest source of revenue — from its lottery and two casinos. State officials have commissioned an economic impact study to assess “various likely competitive threats” to the two casinos, Twin River and Newport Grand.

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