Expanded Boston Lawsuit Against Proposed Casino Could Benefit CT Resorts—at Least Temporarily

Boston Mayor Marty Walsh is doubling down on a lawsuit against a proposed casino in Greater Boston, a move that could bring relief to the two Connecticut casinos which have been near panic over impending Massachusetts gaming facilities. However, the expanded litigation by Boston would do nothing to slow the pace of the MGM Grand resort-casino in Springfield, the main source of consternation over gambling competition.

Mayor Walsh expanded an existing lawsuit against the Massachusetts Gaming Commission which granted the Greater Boston license—one of three in the state—to Wynn Resorts to build a $1.75 billion facility in Everett, just north of Boston. The suit claims the commission violated its own rules, failed to disclose conflicts and generally rigged the competition for the license in favor of Steve Wynn.

Wynn Resorts beat out a proposal from Mohegan Sun, one of the two tribes that operate a casino in Connecticut. Walsh’s lawsuit makes some serious charges detailed in Thursday’s Boston Globe.

As all the parts are moving in Boston, the Connecticut General Assembly is working on a watered-down version of a bill that would allow a third Connecticut casino to be voted on sometime in 2016. That legislation is generally thought to be aimed at allowing a new casino in the I-91 corridor although any town can make proposals to the two existing tribes that would jointly operate a third facility. Legislators seem freaked the new Springfield MGM Grand facility would suck away jobs from Connecticut.

A study commissioned by the two Connecticut Indian tribes says a third Connecticut casino—one in north-central Connecticut—would keep 53 percent of the gambling dollars in state that would otherwise be headed to Springfield.

Any delay in either the Springfield or Greater Boston projects would be good news for Foxwoods and Mohegan Sun which have both seen declining revenues. Under the gaming compact, 25 percent of the slot revenue at the two casinos goes to the state. So what’s bad for business in Connecticut gambling is bad for state government already starved for cash and facing massive deficits.

Similarly, it’s easy to conclude Boston Mayor Walsh’s motivation is not simply about the fairness of the selection process. Boston had a deal in place to receive some $18 million a year from the Mohegans under their proposal in Revere but has no such deal with Wynn in Everett. So if Wynn wins, Boston loses.

There are however genuine concerns about the process that resulted in the granting of the license to Wynn.