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Lamont, Mohegans say they’ve reached gambling expansion deal

March 2, 2021 GMT

Gov. Ned Lamont and the Mohegan tribal chair, who leads one of the state’s two federally recognized Native American tribes, announced Tuesday they have reached an agreement on a comprehensive gambling expansion plan for the state that could eventually lead to legalized sports wagering and online gambling.

The Democratic governor and Mohegan Tribal Chair James Gessner Jr. released a joint statement just hours after Lamont’s chief of staff, Paul Mounds, appeared before the General Assembly’s Public Safety Committee and told state legislators the administration was “at the precipice” of finally reaching a deal.

While Mounds had said the administration’s goal was to include the Mashantucket Pequot Tribe in the final agreement, the owners and operators of Foxwoods Resort Casino were not mentioned in the limited joint statement, which didn’t sit well with tribal chair Rodney Butler.

“After months of closed-door negotiations, it’s offensive that Governor Lamont would announce an agreement with only one of the two Tribal Nations that have been a party to the negotiations, despite full knowledge that both sovereign Nations are needed to implement any agreement,” Butler said in a statement. “We have participated in these discussions in good faith and consider today’s events extremely disrespectful in terms of process and substance. ”

Under the arrangement, which will ultimately need approvals from the state’s General Assembly and the U.S. Department of Interior, there would be a 20% tax on new online gambling offerings and a 13.75% tax on sports wagering, generating “tens of millions of dollars in new revenue” for the state. The news release does not provide much more detail. A message was left with Lamont’s office seeking additional information.

Lamont said in a statement that the state’s agreement with the Mohegans “represents months of hard work and dedication to getting a deal that’s best for the residents of Connecticut and moves our state forward when it comes to the future of gaming.” He said the state is “incredibly fortunate to have such a devoted partner in these efforts like the Mohegan Tribe, as they have been open to negotiation, honest discussion, and a positive path forward that is beneficial for both their tribe and the State of Connecticut.”

The news release makes it clear that the tribes would not have exclusive rights to sports wagering, as they had previously sought. Under the deal announced Tuesday afternoon, the quasi-public Connecticut Lottery Corporation would be allowed to operate 15 retail sports betting locations as well as online sports betting operations. Additionally, the lottery would be able to “sub-license” some of those locations to the “state-licensed pari-mutuel operator,” which is Sportech Venues.

Sportech was not impressed. In a written statement, the company which owns and operates 14 off-track betting locations, two Bobby V’s Restaurant & Sports Bar locations in Connecticut, as well as online, mobile and telephone wagering operations, said it was “principally” excluded from the plan and has “little option but to pursue legal recourse on behalf of our 400 Connecticut employees.”

Mounds acknowledged earlier on Tuesday that the administration has not yet included Sportech in its negotiations with the tribes, which began in the summer.

The announcement from Lamont and the Mohegans also says the lottery would “undertake” new retail sports betting venues in Hartford and Bridgeport.

“The Mohegan Tribe is proud to have reached this agreement with Governor Lamont and the State of Connecticut,” Gessner said in a written statement. “This path will allow Connecticut to generate tax revenues from sports and online gaming that are competitive with other states, and help keep Connecticut with those states when it comes to growing our economy and benefiting the state budget. We’re thankful to Governor Lamont and his team, and we look forward to continued work with the General Assembly as this process continues.”

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Earlier in the day, Butler said the negotiators were “literally on the one-inch line,” but the sticking point for the Mashantucket Pequots was a revenue issue that equates to “a rounding error” for the state budget that adds up to about $500,000 to $1 million for the tribe and is financially crucial. He said it will be “easily resolved if some sense of mutual respect is afforded for the specific needs of our tribal community,” noting his tribe remains open to continuing discussions.

Connecticut has grappled for years with how to modernize gambling in the state given the two tribes’ exclusive rights to casino gambling under a compact with the state. In exchange for those exclusive rights, the two tribes provide the state of Connecticut 25% of their slot machine revenues. They’ve warned that Connecticut could lose that revenue if other gambling entities were allowed to offer wagering they considered to be casino games under their arrangement with the state.