Seven Massachusetts Legislators Ask Gaming Commission for Financial Report on a Brockton Casino License

Last updated on November 2nd, 2018

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Seven Massachusetts lawmakers have asked the commonwealth’s Gaming Commission to delay licensing for a proposed casino in Brockton. If Massachusetts approves such a casino, then the Mashpee Wampanoag tribe would be exempt from paying state taxes on its own $1 billion casino which is under development at the moment.

The Wampanoag tribe’s casino, which is expected to be named the Mashpee Wampanoag Tribe’s First Light Resort & Casino, will be located on reservation land near Taunton.

The seven legislators who signed the letter are Paul Heroux (D-Taunton), Shawn Dooley (R-Norfolk), F. Jay Barrows (R-Mansfield), Steven Howitt (R-Bristol), Elizabeth Poirier (R-Bristol), Jeffrey Roy (D-Norfolk), and Richard Ross (R-Norfolk). The group of legislators asked the Massachusetts Gaming Commission to ask for the Revenue Division to conduct a study on the economic impact of forging ahead with the Brockton casino and foregoing the Wampanoag taxes.

Lawmakers Ask for Financial Evidence

In it letter to the commission, the lawmakers asked for evidence which “conclusively demonstrates that a tax-free casino in Taunton does not negatively affect total commonwealth tax collections.”

The signees said they are concerned that the First Light Resort will have a competitive advantage if it does not have to pay taxes. Not only do they believe the advantage will hurt the revenues of a Brockton casino, but it also will hurt the Plainridge Park Casino, a racetrack and slots parlor.

The seven signees’ call for conclusive evidence is likely a reference to two separate reports which came to two diametrically opposed opinions on the decision ahead for the Gaming Commission.

Dueling Financial Reports

Mass Gaming & Entertainment, which hopes to secure the Brockton license, claims it has a report which says the competing Brockton and Taunton casinos would bring in more revenue for the state. Neil Bluhm, who owns Rush Street Gaming (Mass Gaming’s parent company), hired the Innovation Group to study the question. Innovation Group found in favor of the dual casinos.

For its part, the Wampanoag tribe commissioned a report by the respected Spectrum Gaming, which said the state would lose $28 million in revenue every year if it went through with its plan to build a Brockton casino.

Mashpee Wampanoag Tribe’s Gaming Compact

In a gaming compact with the state, the Wampanoag tribe agreed to pay the state of Massachusetts 17% taxes on their gaming revenues. That decision came with one major stipulation: they tribe would pay the seventeen percent only if it owned the only casino in Southeastern Massachusetts, known as Region C. The Native American tribe received approval to build a casino from the U.S. Ministry of the Interior, so it does not need the state’s approval to build its casino.

The Brockton casino is the third casino which was approved by a statewide vote in 2011, when the Massachusetts state treasury was reeling from the impact of the Global Recession. During that crisis, the Massachusetts Gaming Commission was given the right to license up to 3 non-tribal casinos.

MGM Springfield and Wynn Boston Harbor

The first two of those casinos already have been licensed by the commission. One is the Wynn Boston Harbor, which is set to be built in the city of Everett, one of the suburbs of Boston. The second casino is the MGM Springfield, which will be built in Western Massachusetts. In the planning stages, that left Southeastern Massachusetts as the third region to be considered.

The Massachusetts Gaming Commission plans to hold a hearing next Tuesday to determine whether to approve a license for Brockton. The applicant is Mass Gaming & Entertainment, which plans on developing a $677 million casinoa and hotel in Brockton, Massachusetts. The casino be less than 25 miles away from Taunton, and thus a direct competitor for gambling dollars.

Statements from Both Sides

The idea of building a casino adjacent to a billion-dollar competitor sounds like a disaster to the seven legislators. The their letter read, “The prospect of a tax-free casino operating within the commonwealth was not a rationale for either the Legislature’s decision to expand gaming, nor, we are sure, for the more than 1.2 million Massachusetts voters who supported our decision via referendum at the last election.”

Mass Gaming & Entertainment spokesman Joe Baerlein issued his own statement on the upcoming decision. Baerlein said, “It is our understanding that the Massachusetts Gaming Commission also has conducted its own financial analysis and hired another highly respected firm to peer review the Innovation Group’s projections, already satisfying the request for independent analysis.“