Lamont, tribes reach agreement on gambling expansion
HARTFORD, Conn. (AP) — Gov. Ned Lamont’s administration has reached an agreement with Connecticut’s two federally recognized Native American tribes on a gambling expansion plan that could lead to sports wagering and online gambling, the governor and tribes announced Thursday.
The Democratic governor and leaders of the Mashantucket Pequot and Mohegan tribes said the deal would modernize gambling in Connecticut, generate tens of millions of dollars in new revenue for the state, and improve financial conditions for the tribes’ Eastern Connecticut casinos, Foxwoods and Mohegan Sun.
“Connecticut is on cusp of providing a modern, technologically advanced gaming experience for our residents, which will be competitive with our neighboring states,” Lamont said in an announcement with the tribal leaders.
The agreement would need approval from the state General Assembly and the U.S. Interior Department. It comes about two weeks after Lamont’s chief of staff said the administration had reached an agreement with just the Mohegan tribe.
Rodney Butler, chairman of the Mashantucket Pequots, said at the time that his tribe was offended a deal had been announced prematurely with one of the two sovereign nations. Butler said there was one remaining sticking point for the Mashantuckets that equated to “a rounding error” for the state budget but was financially significant for the tribe. On Thursday, Butler said issues involving tax rates, marketing issues and sports betting have since been worked out.
“It’s a great day to say that we’re finally here and moving on to the next step of getting this through the legislature and getting approvals from (U.S. Department of) Interior and everything else in place so that we can successfully launch a new market for the state of Connecticut in the coming months,” he said.
Under the arrangement announced Thursday, the state would set an 18% tax rate for the first five years on new online gambling offered by the casinos, followed by a 20% rate for at least the following five years. There would be a 13.75% state tax on sports wagering.
Currently, the state receives 25% of the slot machine revenues generated at Foxwoods and Mohegan Sun, in return for granting the tribes exclusive rights to offer casino games.
The Connecticut Lottery would be allowed to offer sports wagering along with the tribes. Max Reiss, a spokesman for Lamont, said the three entities — the lottery, Foxwoods and Mohegan Sun — would each offer their own version of sports betting that customers could choose from.
Butler explained that players will likely download a fantasy sports app — DraftKings in the case of Foxwoods — and when they’re in Connecticut they will be able to place bets on a team or tournament or switch to an online slot machine or play blackjack or other games. Geofencing technology can determine if someone is in Connecticut or not. He said he expects the online gambling and sports betting, including a new facility inside Foxwoods, will amount to about 10-15% of the casino’s current operations.
Under the agreement, the lottery would also be allowed to operate 15 retail sports betting locations, run new retail sports betting venues in Hartford and Bridgeport and expand online lottery offerings.
The lottery will be able to sublicense locations to the state-licensed parimutuel operator, Sportech, which owns and operates 14 off-track betting locations, two Bobby V’s Restaurant & Sports Bar locations in Connecticut.
Sportech, which threatened legal action when the tentative deal was first announced two weeks ago, said Thursday it remained disappointed with the agreement. It says it does not appear to offer a “level playing field,” depriving consumers of a “healthy competitive betting marketplace” and putting the company’s 400 jobs at risk.
Connecticut has grappled for years with how to authorize sports betting and online gambling, given the state’s unique and existing revenue-sharing arrangement with both tribes.
Speaking at an unrelated event in Manchester, Lamont said lessons learned from the pandemic made it clear it’s was time to finally reach a deal.
“As you know, it has gone on for many, many years. I think of the many things we have learned after a year of COVID more and more the world is going virtual, and what that means in terms of gambling,” Lamont said.
“Right now we have the old mechanical slot machines, and some amazing casinos, and people going back there, but I think more and more you’re going to see i-gaming, i-lottery, sports betting that is online, fantasy sports, and there are a lot of moving pieces.”
Lamont said the deal “allows the tribes to grow and prosper” and “bring our cities and towns back to life,” noting that neighboring states have legalized sports betting.
House Minority Leader Vincent Candelora, R-North Branford, called the agreement “welcome news” and “an important milestone in what’s been a long, complex and sometimes frustrating effort to modernize our gaming landscape as we watched other states take steps toward achieving advancements of their own.”
Both tribes also agreed to stop development of a casino in East Windsor through the duration of the deal. The East Windsor casino was aimed at curbing competition from the MGM Springfield casino in Springfield, Mass. Lamont has been unenthusiastic about the project.
The Mashantucket and Pequot tribes and Lamont appeared unified Thursday.
“This will allow Connecticut to generate tax revenues from sports and online gaming that are competitive with other states, to the benefit of both state and local municipal budgets, as well as our tribe’s members,” Gessner said in the joint statement.