Mohegans reach deal with Lamont on sports, online betting
The Mohegan Tribal Nation has reached a solo deal with the Lamont administration for sports betting and online gambling. A piece of the action would go to the Connecticut Lottery Corp., which could offer online games and open sports betting venues in Bridgeport and Hartford.
In a statement shortly before 4 p.m., Gov. Ned Lamont and Mohegan Tribe Chairman James Gessner Jr. culminated two years of off-and-on negotiations in a deal they said would generate tens of millions of dollars in new revenue, and make the state competitive with its neighbors.
The Mashantucket Tribal Nation, which operates Foxwoods Resort Casino, the state’s oldest casino, announced in a statement that it was offended by the “disrespectful” deal, which revealed details of negotiations with the state. That tribe’s chairman said a deal can’t exist without both tribes because it would affect the 1990s-era compacts between the state and the tribes — which are under federal control.
The Lamont-Mohegan deal, which requires approval by the General Assembly, includes a 20 percent tax rate on new online casino gambling such poker and a 13.75 percent tax rate on sports wagering, such as the point spread on a Brooklyn Nets-Boston Celtics game.
The quasi-public Connecticut Lottery would operate up to 15 retail sports betting locations, as well as online sports betting, opening up a universe of wagering on major and minor sports.
The lottery would be able to license some of those locations to Sportech, the state’s pari-mutuel off-track betting operator at locations such as Winners at Sports Haven in New Haven and Bobby V’s in Stamford and Windsor Locks, where betting is currently limited to horse and dog races and jai alai games.
Connecticut Lottery would also be allowed to start up new in-person sports-betting locations in Hartford, as well as Bridgeport.
“This agreement 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,” Lamont said in a written statement. “We are 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 Mohegan Tribe is proud to have reached this agreement with Gov. Lamont and the state of Connecticut,” Gessner said. “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.”
State Rep. Steve Stafstrom, D-Bridgeport, said a satellite sports betting site in Bridgeport could become an important attraction for a city that has been eager to host gambling entertainment since at least 1994. In 2017, MGM Resorts International proposed a $675 million casino on Bridgeport Harbor but that plan was not approved by the General Assembly, under opposition from the tribes.
“The push to bring some sort of gaming to the city has been a long time coming and this is a big step in the right direction,” Stafstrom said.
Foxwoods charges bad faith
The deal culminated a day in which Paul Mounds, Lamont’s chief of staff and a former football player at Trinity College, put it in gridiron terms — saying it was first down, goal to go at the 1-yard-line. He held out hope that the Mashantucket Pequot Tribal Nation would join in a final deal.
Rodney Butler, chairman of the Mashantucket Pequots, criticized the deal.
“After months of closeddoor negotiations, it’s offensive that Gov. 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 written statement. “We have participated in these discussions in good faith and consider today’s events extremely disrespectful in terms of process and substance.”
Butler said that the revealed details illustrated “significant and substantial concessions made by both tribes,” especially the agreement to allow the Lottery to participate in full sports betting.
The core issue has long been whether and how the tribes control sports betting and online gaming, and whether and how other gaming operators would participate in Connecticut.
Those entities include Sportech, the Connecticut Lottery Corp. and outside commercial gaming companies such as MGM.
The tribes long claimed exclusive ownership of sports betting and online gaming under their separate compacts, which give their casinos sole rights to “casino games” in exchange for 25 percent of slot machine revenues. Those payments have totaled more than $8 billion so far, since Foxwoods first opened in February, 1992, followed by Mohegan Sun in 1996.
“We have one remaining point of contention that is easily resolved if some sense of mutual respect is afforded for the specific needs of our tribal community,” Butler said. “We remain open to discussions and hope this is resolved quickly for the benefit of the entire state of Connecticut.”
But for now, the Mohegans, who opened their Mohegan Sun casino in Uncasville in 1996, have the inside track in an attempt to join nearby states including New Jersey, where only people located within the borders of the state are allowed to wager on sports.
Lamont has planned on $47 million in additional revenue for the budget year that starts July 1, 2023.
Sportech: Lawsuit likely
Sportech, in a statement late Tuesday afternoon, criticized the deal and threatened legal action.
“One year ago, Gov. Lamont stated he would seek a fair resolution regarding gaming expansion involving existing gaming operators that ‘must be designed to avoid and withstand endless legal challenges,’” the company said. “Regretfully, the governor’s announcement this afternoon, that principally excludes Sportech from expanded gaming, leaves us with little option but to pursue legal recourse on behalf of our 400 Connecticut employees.”
The Mohegan Tribal Gaming Authority, which operates Mohegan Sun in southeastern Connecticut, reached an agreement with Kambi Group plc, a sports betting provider, nearly two years ago. Foxwoods also has a deal with an outside provider, DraftKings, which holds a strong market position in a dozen U.S. states that allow sports betting.
For at least the two years under Lamont, the state has negotiated with the Mashantucket Pequot and Mohegan tribes separately – leaving open the possibility of a deal with one and not the other. In 2018, the U.S. Supreme Court ruled that states may sanction sports betting in a New Jersey case called Murphy v. the National Collegiate Athletic Association.
“Negotiations will continue in the best interests of the state but at the same time these are individual compacts between the state and each tribe,” Lamont spokesman Max Reiss said.
Between the two tribes and their casino operations, Mohegan Sun is believed to be in a stronger financial position than the Mashantucket Pequots and their Foxwoods Resort Casino. The Mohegan Tribal Gaming Authority has significant revenue worldwide and elsewhere in the United States, with a consulting and management business and ownership interests at, for example, Mohegan Sun Pocono in Pennsylvania.
In each of the last two months, Foxwoods has had to make additional payments to the state of Connecticut under its 1992 compact that calls for the casino to pay the state 25 percent of slot revenues, with a minimum payment of $80 million a year from each casino. Foxwoods had never previously had to make such a payment, after a ramp-up period at the start of the agreement.
Butler, the Mashantucket chairman, said previously that Foxwoods has voluntarily agreed to stringent state distancing rules and customer limits without seeking compensation for doing so.