Saturday, December 29, 2007

Former Sun Exec To Open Next Atlantic City Casino

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Kevin De Sanctis, who oversaw all pre-opening operational matters for the Mohegan Sun casino while working for Sun International, will open the next casino in Atlantic City.

“Revel” is scheduled to open on the northern tip of the boardwalk during the same season that Mohegan Sun’s next hotel is due to open - almost three years away. De Sanctis is now Revel's president and chief operating officer. The mega-casino is the first in a wave of development expected to take place in Atlantic City over the next five years and is expected to cost $2 billion. The project will include 3,800 hotel rooms and 150,000 square feet of gaming space. Revel is due to be the first casino in Atlantic City to open since the Borgata in 2003.

De Sanctis left Sun International to work for Penn National in February 2001 and was Penn’s president and chief operating officer when they sold their Pocono Downs racetrack to the Mohegan Tribe for about $280 million in January 2005.

Revel’s 20-acre site is “one of the largest, most uniform and contiguous properties in Atlantic City,” according to the company. Goldman Sachs is a partner in the Revel Entertainment development and purchased the prime Atlantic City property late last year for $74 million.

Pinnacle Entertainment, a competitor of the Mohegans in the bidding for a Kansas City casino, is scheduled to open a new Atlantic City casino in 2012. Pinnacle bought the 18-acre Sands Casino Hotel with adjacent beachfront property for $250 million last year from financier Carl Icahn.

The largest of the planned Atlantic City developments is MGM Mirgage's $5 billion mega-casino in the marina district that is scheduled to open five years from now. The MGM project would be the largest investment in Atlantic City's casino history.

Including a fourth development planned by a private investor group led by former Caesars Entertainment Inc. chief executive Wallace R. Barr, all of the new projects will total about $9 billion.

Wednesday, December 26, 2007

NLRB Sets Hearing Date on Last Month's Union Vote at Foxwoods

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The National Labor Relations Board will hold a hearing on January 15th in Hartford to address the Mashantucket Pequot's complaints that the November union vote held at Foxwoods Resort Casino should be invalidated because of improper election conduct on the part of the United Auto Workers union.

The NLRB has already dismissed a Mashantucket complaint that was based on its tribal sovereignty.

Friday, December 21, 2007

Tribe Predicts Construction at both the Sun and Poconos Will Be 25% Over Budget

By Ken Davison
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The cost of the Tribe’s two expansions, one at the Mohegan Sun and the other at the Tribe’s Pocono Downs in Pennsylvania, will run 25% over the the budgeted amounts announced just one year ago.

The Tribe made the announcement last week during a conference call with financial analysts in which the Tribe’s gaming authority also reported upon their fiscal year’s fourth quarter gaming results.

The New Price

The cost of the current expansion project at the Mohegan Sun casino on the reservation, called Project Horizon, is projected to increase by $185 million to $925 million. The Tribe announced last November that the expansion would cost $740 million and include a 1,000-room hotel and 900 slot machines, among other amenities. Although the new cost will be significantly higher, the hotel will now have only 922 rooms and the gaming space will include 826 slot machines.

The Tribe began the three-year Project Horizon six months ago in a groundbreaking that took place on June 7th.

The expansion in Pennsylvania, called Project Sunrise, will also exceed its earlier budget estimate by 25% before it is completed. Earlier estimates of the Phase II construction were between $140 and $150 million but that will increase to $208 million, according to Bob Soper, CEO of Pocono Downs.

The Pocono's Project Sunrise began last May 4th, according to officials.

Rising prices of raw materials and a faulty estimate were cited for last year’s incorrect Mohegan Sun budget figures.

Former chairman of the tribal council Roland Harris stepped down from the tribal council last year to assume the post of MTGA's senior vice president in charge of construction and special projects. Harris abruptly stepped down from his post two weeks ago - a job that paid him a salary of around a half-million dollars annualy (Harris was paid $306,286 from March 2007 through September 2007). The Tribe has said they will seek someone with qualifications this time.

Deja Vu - The Last Expansion

The budget overruns are reminiscent of the last expansion on the reservation. The expansion at Mohegan Sun that first opened in 2001, called Project Sunburst, exceeded its original estimate by about 50%. The final cost was about $1.2 billion compared to the $800 million originally projected for the expansion. In that expansion, the number of hotel rooms was also reduced, from 1,500 to 1,200 rooms.

Expansion at any price? The $1.2 billion cost of Project Sunburst does not include the approximately $1 billion the Tribe is paying its former casino management company, Trading Cove Associates, which ended the management contract early and paved the way for an expansion controlled entirely by the tribal council under then-chairman Roland Harris.

I’ll hide the cheese where the rats will never find it

According to Tom Acevedo, the Mohegan government’s former chief-of-staff and former NIGC official, in an internal investigatory witness statement taken in 2001, “(I) had a conversation with Len Wolman, (a partner in) Trading Cove Associates, regarding the hotel tower (construction) contract. He said contractors believed that the Mohegan Tribe was just cutting deals with their favorite contractors and it was a waste of time to bid for work. Wolman said the lack of bidding companies was costing the Tribe a great deal of money.” Acevedo himself said the selection process was an orchestrated set-up while another witness said, "… it is obvious through the actions of the Tribe they planned on giving the ($29 million) contract to Manafort from the beginning …”

Former head of the Mohegan Tribal Gaming Commission, Bud Mullen, was documented as saying there was suspected abuse in connection with some of the contracts related to the construction but that was not his area of responsibility.

Mullen, also a former assistant director for the FBI and head of the DEA, said he told then-chairman Roland Harris to be very careful of the the Tribe's construction representative Bill Katz (whom Harris hired at $30,000 per month and later increased to $50,000 per month), because Katz told them at lunch one day that “I can bury the cheese where the rats will never find it.”

See related articles at:

Tribe May Be Interested in Atlantic City Property

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The Tropicana casino in Atlantic City is up for sale and the Mohegan Tribe is one of the groups expressing an interest in the property, which some analysts say could sell for $1 billion dollars.

One year after Columbia-Sussex received temporary approval to operate the hotel, the New Jersey’s Casino Control Commission voted 4-1 on Wednesday not to renew the license. Since the license denial, the casino has been in control by a state-appointed trustee.

The Casino Control Commission said that the operators of the Tropicana did not have the good character and business ability to run a "first-class facility of superior quality." The Tropicana did not adhere to the New Jersey Casino Control Act’s vision of "restoring Atlantic City as a resort, tourist and convention destination." Nearly one-quarter of the casino and hotel’s workforce was cut and there were complaints of uncleanliness.

At least a half-dozen companies have contacted officials about possibly buying the Tropicana. The Cordish Company of Baltimore is one of the potential buyers. Cordish is also in direct competition with the Tribe for a Kansas casino. The Cordish Company developed a $204 million outlet mall in Atlantic city and teamed up with former Tropicana executive Dennis Gomes to form a gaming management company. Pinnacle Entertainment, another competitor of the Tribe for a Kansas casino, and Steve Wynn are also named as being interested in the casino and hotel.

Massachusetts Lawmakers Question Tribe's Contract with Trading Cove

By Ken Davison

Massachusetts Governor Deval Patrick, casino and race track owners and others spoke to state lawmakers of the economic benefits that Patrick’s casino plan would bring to the state. The governor is asking lawmakers to authorize three casinos in the state because of the jobs and state revenue casinos would provide.

The hearing was not held by the committee charged with the casino plan but by the commission on bond issues and capital assets and was designed to begin discussions on the plan.

The hearing was the governor’s first high-profile appearance to push his casino plan since he announced it in September. His plan calls for three mega-casinos in the state: one in the western part of the state, one in the southeast and one in the Boston metropolitan area. He said the tribes from his state would have preference in the selection process.

The Mohegan Tribe’s tribal council chairman and the CEO of the Mohegan Tribal Gaming Authority, Mitchell Etess, spoke to the group of their vision for a casino in western Massachusetts but found that most legislators were more interested in the Mohegan’s contract with its former casino management company, Trading Cove Associates.

Trading Cove is backing the Mashpee Wampanoag Tribe for a casino in Massachusetts, a project that some see as having spurred the governor to announce his own casino plan. The Mashpee’s casino is being done under a federal law that grants a federally-recognized tribe the right to operate the same games of chance on their reservation as those allowed under state law. Massachusetts allows charities to run casino games, a right which must be extended to tribes.

The principal partners of Trading Cove, Sol Kerzner and Len Wolman, also operate one of the two Rhode Island racetracks permitted under state law to operate slot machines. Twin River has 4,500 slot machines and draws customers from Rhode Island and southern Massachusetts.

Control of the Casino Regardless of its Cost?

The Mohegan Tribe bought out the last three and a half years of Trading Cove’s 7-year management contract to allow the tribal council under then-chairman Roland Harris to control the Mohegan Sun casino and a $1.2 billion (Sunburst) expansion.. In return for this control, the Tribe pays Trading Cove 5% of every dollar taken in at the casino for a 15-year period. The Tribe is expected pay Trading Cove in excess of $1 billion before the contract expires on December 31, 2014.

Sheldon Adelson of Las Vegas Sands Corporation said that Trading Cove’s partners were the "envy of a lot of people in the industry" for their deal with the Mohegans. Adelson, also the third richest man in America added, "I'm shocked that IGRA, that the BIA, allowed them to get away with it," Adelson said.

According to the Boston Globe, Trading Cove has spent almost $1 million since 2002 for lobbyists, including $495,000 since 2003 for lobbyist A. Bradford Card, the brother of President Bush's former chief-of-staff Andrew Card.

Adelson said he may not be interested in bidding for one of the licenses if the state allows more than two casinos.

The Mohegan Tribe and their partners announced their desire for a $1 billion casino resort complex in western Massachusetts that would include 4,000 slot machines, a 600-room hotel and a giant retail center.

The Tribe signed an exclusive agreement with Northeast Realty and Pennsylvania Real Estate Investment Trust, a developer of residential and office establishments, to seek one of the state’s proposed commercial casino licenses for a casino on 150 acres of land in Palmer, near the Massachusetts Turnpike in the western part of the state.

Governor Patrick, trying to stem opposition to his plan on moral grounds, argued that the state has always been involved in gambling "In 1762, John Hancock raised lottery money to rebuild Faneuil Hall after a fire. Lottery funds were used to finance the Revolution."

Patrick hopes that lawmakers vote on the casino bill before next July.

See Sean Murphy's article "Casino Jackpot Went To Investors" in the Boston Globe at:

East Lyme Schools Closed on Stomach Flu Outbreak

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All East Lyme public schools will be closed on Friday after an outbreak of the stomach flu virus hit a large number of middle school students, school officials said. On Wednesday, 189 students were absent and 133 on Thursday.

Superintendent Paul Smotas said in a statement that the middle school "experienced an unusually high number of absences and of students needing to be sent home from the nurse's office."Most of those students were experiencing symptoms connected with the Norovirus, which causes nausea, vomiting and diarrhea for up to two days.

Overpaid By Cashier or Underpaid by Slot Machine?

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The Pennsylvania state police gaming enforcement office at the Tribe's Pocono Downs racetrack-slot parlor said a man allegedly refused to return money after he was mistakenly overpaid by a cashier, according to the Times Leader paper. The man redeemed two vouchers in the amount of $1,178 on Monday. Police said the man was overpaid $600 and refused to return the money. The name of the man wasn't released.

See article:

Christmas Wishes

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The Day newspaper's David Collins' thoughts on what some people may want for Christmas. Included on the list are the Mohegans and further on, Mitchell Etess:

See article:

Mashantucket Names Business CEO

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The Mashantucket Pequot Nation has named its first CEO to oversee all gaming, resort and entertainment operations for the Tribe. Patricia Irvin, a graduate of Harvard Law School and a former deputy assistant secretary of defense during the first Clinton administration, is expected to focus on the Tribe’s diversification efforts.

Irvin also worked for 14 years at a prominent Wall Street law firm, Milbank Tweed, and was chief operations officer for the Andrew W. Mellon Foundation in New York City.

Tuesday, December 18, 2007

Slot Revenues Decline for Third Consecutive Month at Both Connecticut Casinos

By Ken Davison

Slot revenues at both the Mohegan Sun and Foxwoods casinos declined in each of the last three months, continuing a downward trend that began last Spring.

Competition in New York and Rhode Island and a weaker economy and higher gas prices may be partially responsible for the decline but fewer slot machines in use on the gaming floor also played a role.

The Mohegan's business arm, the Mohegan Tribal Gaming Commission (MTGA), reported $70.5 million in November slot revenue at the Mohegan Sun casino, a 3.8 % decline from the same month in the prior year. Overall, slot revenues declined 2.7% in the three month period of September through November while wagers at the machines, also known as slot handle, fell by 4.5%.

Since April, slot machine wagers at Mohegan Sun have decreased for 6 of the last 8 months. Overall, the handle fell by 2.4% at Mohegan Sun in the last 8 month period while wagers at Foxwoods have risen over that same period by less than one percent. By comparison, for the 15 months prior to April, the handle at Mohegan Sun fell only once - in December 2005.

Although figures for the number of slot machines and the daily win-per-machine for November were not available, on average Mohegan Sun had about 200 fewer slot machines in use between April and October of this year when compared to that same period in the previous year. Mohegan Sun's win-per-slot machine for April through October was $432 compared to $420 for the same period in the prior year. Foxwoods, on the other hand, had an average of 135 more machines in use from April through October this year than in the past year.

Slot machine revenue at the Mohegan Sun alone accounts for over 50% of the Mohegan Tribal Gaming Authority’s total revenues, contributing $922 million out of the $1.75 billion in total MTGA revenue for the twelve months that ended in September, or Fiscal Year 2007. The amount wagered at slot machines is not included in the revenue, only the amount lost by customers (wagers, or handle - less payouts) is counted as slot machine revenue.

Slot machine revenue at both the Mohegan Sun and Pocono Downs, combined, accounted for nearly two-thirds of MTGA’s $1.75 in total revenue for the last fiscal year.

Last week, Foxwoods also reported a decline in November slot revenue. They reported $58.9 million, a decrease of slightly over 1% from the prior year. Like Mohegan Sun, Foxwoods slot revenue has also declined in each of the last three months but their slot handle actually increased in two of those months. In the last three months, slot revenues decreased overall by 5.6% while the handle went down by 1.3% over that same period.

For the month of November, the Mohegan Sun reported $814 million in slot handle, a 3.4% decrease from the prior year. Foxwoods reported $734 million in handle, an increase of 6.7%. Had Foxwoods not increased the percentage of its handle paid out to its customers in November, its revenues would have reflected an increase compared to the prior year. Mohegan paid out 91.35% of its November handle and Foxwoods paid 91.97%.

Mitchell Etess attributed the declines to weaker consumer confidence and was quoted in The Day newspaper of New London, CT "Overall, when you compare our declines to Atlantic City, we feel like we're holding our own." Slot revenues at Atlantic City's 11 casinos fell by 12.6% in both September and October, reflecting in large part a barrage of new casino openings over the past year in neighboring Pennsylvania. This year is almost certain to become the first year in the state's 29 year casino history that casino revenues will have declined from the prior year.

The month of December may extend the slot declines at both casinos if only because last December may be hard to beat: In December 2006, the Mohegan Sun had its largest monthly increase in its slot handle for the past two and a half years and Foxwoods recorded an 11% increase in its December slot handle last year.

The winter storm in recent days couldn't have helped revenues at either casino. The Tribe's Pocono Downs race track-casino in Pennsylvania continued to record record low revenues since the competing Mount Airy Casino opened in late October. In the week that ended on Sunday, slot revenues were down by 37% since the week before Mount Airy Casino opened.

The daily win-per-machine at Pocono Downs was $275 for last week compared to $439 in the week before Mount Airy Casino opened. Since Mount Airy Casino's opening, the daily win-per-machine has averaged $325 per machine.

Currently, Mohegan Sun has about 6,200 slot machines and Foxwoods has about 7,200 machines.

Upon completion of their current expansions, Foxwoods expects to have a total of 8,650 slot machines and the Mohegan Sun plans to have 7,000 machines.

Note: MTGA's FY 2007 income statement shows gross revenue of $1.75 billion and is comprised of the following:

Gaming Revenue $1.1 billion
Table Game Revenue $395 million
Entertainment and Retail Revenue $133 million
Food and Beverage Revenue $102 million
Hotel Revenue $47 million

The gross revenues of $1.75 billion are reduced by promotional allowances of $132 million to arrive at net revenues of $1.62 billion in the last fiscal year, which ended on September 30, 2007. This figure of $1.75 billion less expenses equals the profit. This article doesn't deal with expenses, however it should be clarified that Pennsylvania taxes and payments to the state of Connecticut and to Trading Cove Associates are classified as expenses on the income statement.

The Tribe pays the state of Connecticut 25% of its slot revenues and pays Trading Cove Associates 5% of the slot revenues (and other revenues) at Mohegan Sun. The Tribe pays 55% of its Pocono Downs slot revenue to the state of Pennsylvania.

Saturday, December 15, 2007

Tribal Family Holiday Party

The tribal government will make a decision by noon on Saturday whether to cancel the holiday party. Tribal members can check the tribal hotline, 860-862-6008 and tune in to WSFB Channel 3 under the name “Mohegan Tribal Rec Program.”

Friday, December 14, 2007

Mohegan's Kansas Casino Proposal to Compete Against Three Others in Lengthy Final Round

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Officials from Wyandotte County-Kansas City forwarded the Mohegan Tribe's $770 million casino proposal and two others to the state lottery commission yesterday, signalling to the commission that any one of the proposed casinos would be acceptable to them.

In addition to the Mohegan proposal, county officials forwarded proposals from Pinnacle and from a partnership between Kansas Speedway and the Cordish Company. All three are proposing casinos within a mile of the Village West entertainment district and will also be competing with Golden Gaming's $600 million casino, the only proposal forwarded by local officials in Edwardsville.

Only one of the four will be selected by the Kansas Lottery Commission in May.

The Mohegans, partnering with principals from Kansas City-based RED Development and Las Vegas-based Olympia Gaming, proposed a $770 million casino, while Pinnacle priced its casino at $650 million and the partnership between Kansas Speedway and the Cordish Company would build a $670 million Hard Rock casino.

Thursday, December 13, 2007

Mohegan's New York Casino Bid Continues

By Ken Davison

New York Governor Eliot Spitzer has not selected a gaming operator for the Aquaduct race track, located in the Queens Borough of New York City, nor has it been decided whether gaming will also happen at Belmont race track.

The governor originally sought companies to operate both the horse racing and gaming at the tracks but later chose the company that currently runs the racing to continue in that role while he sought new proposals for the gaming aspect.

A thiry-year franchise to operate three race tracks was negotiated between the governor and the New York Racing Association (NYRA). NYRA's current half-decade old franchise is set to expire in less than three weeks, on December 31st.

The winning bidder will need to be approved by the state legislature and the governor's staunchest opponent of the choice of NYRA to operate the racing is Senate Majority Leader Joe Bruno. Negotiations between Bruno and the governor's office have not yet produced an agreement but it appears as if a temporary agreement may be reached as early as tomorrow to confirm the governor's selection of NYRA for the racing franchise.

Wednesday, December 12, 2007

Mashantucket Pequots' Foxwoods - MGM Combined Proposal Eliminated From Kansas Casino Plan

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The Mashantucket's quest for a Kansas casino ended today when officials from the county in which it was planned agreed to forward two competing casino applications to the state for final consideration.

Sumner County officials chose the proposals by Penn National Gaming and Marvel Gaming (casino executives and family members of the Binion Family Trust) and will now forward these proposals to the state lottery commission, which will decide the winning bid. Selection of all winning casino proposals by the commission is scheduled for May 12, 2008 according to reports.
The Mohegan Tribe and their partner's $770 million Kansas casino proposal is in a different region of Kansas, Wyandotte County, and is not competing with the Mashantucket proposal. A formal announcement is expected tomorrow regarding the approval of the Kansas casino proposed by the Mohegan Tribe and their partners. So far only one of the Mohegan's competitors, Las Vegas Sands, was eliminated by the local county government and they have chosen not to fight the county's decision.

The Mashantucket Pequot team hasn't ruled out challenging the local county government's decision.

Feather News Note: A partnership between the Kickapoo and the Sac and Fox Tribe of Kansas, one of the Mohegan Tribe's competitors in Wyandotte County-Kansas City, withdrew their proposal on Wednesday. Four bidders, including the Mohegans and their partners and a proposal from Edwardsville, still remain in the running for a casino in their region. The Tribe will find out on Thursday if their application passed a preliminary but key review.

See related article:

Shareholders OK Penn National Takeover

Penn National Gaming, Inc. announced that, at a special meeting of shareholders held today, its shareholders approved the merger agreement providing for the acquisition of the Company by certain funds managed by affiliates of Fortress Investment Group LLC and Centerbridge Partner. Penn National is seeking to complete the transaction late in the second quarter of 2008. Penn National sold the Pocono Downs race track to the Mohegan Tribe, operates a small slot machine parlor at a Maine race track and other gaming facilities with a combined total of about 23,000 slot machines and 400 table games.

Mohegan's Kansas Casino Proposal Expected to Pass First Round of Review

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The Mohegan's proposal for a Kansas casino is expected to pass its first major hurdle on Thursday, when local government officials in the northeastern county of Wyandotte are scheduled to announce those casino proposals they will forward to a state commission for final consideration.

Four of the five original bidders for the one casino license in that region are still in the race. So far, Las Vegas Sands Corporation is the only bidder that has been eliminated from the group. The county commissioners could forward all four remaining applications, including the Mohegan proposal.

The state lottery commission is authorized to select one casino out of both the Wyandotte group of proposals and a lone proposal forwarded by Edwardsville County. Both counties are near Kansas City on the Missouri border. The winning proposal could be selected by this Spring.

The Tribe and its partners, Olympia Gaming and RED Development principals, unveiled a $770 million resort proposal, featuring a 1,000 room hotel, a casino with 3,500 slot machines and 90 table games, a golf course and 200,000 sqare feet of retail space, among other attractions.

See related article:

Special Membership Meeting Today in Tribal Meeting Room at 5 PM

A special membership meeting has been called by the tribal council for today, December 12th, in the tribal meeting room. Refer to last week's Wuskuso for the purpose of the meeting. The meeting will be held at 5 PM.

Tribal members are encouraged to attend.

Last week's Wuskuso - issue number 48 for the year - was the membership's notification of the special membership meeting this week, so it should be noted that the newsletter was posted to the tribal government official website just yesterday, December 11th, and not on December 5th as stated on the government website.

Tuesday, December 11, 2007

Tribe's Pennsylvania Slot Machine Revenue Report

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The Pennsylvania Gaming Control Board reports on the weekly slot machine revenue for the Tribe’s Pocono Downs and at other gaming properties in the state.

According to these public figures, about $42 million went into the slots at Pennsylvania’s Pocono Downs in the week before the Mount Airy Casino opened. About 91% of this amount is paid out by the slot machines to customers ($38 million) and after deducting certain promotions, the amount remaining - the casino’s win, or revenue – was $3.7 million for the week.

Six weeks after the opening of the Mount Airy Casino, which is located about twenty miles away from the Tribe’s Pocono Downs, the revenues have dropped significantly.

In the week that ended Sunday, Pocono Downs recorded $28 million played at the 1,203 slot machines. After deducting the amount paid out and promotions, the amount remaining was $2.4 million. This was its lowest take since the Mount Airy Casino opened in late October.

Sunday, December 9, 2007

Massachusetts Legislature Sets Hearing on Casinos

By Ken Davison

A high-profile gaming hearing will be held by the Massachusetts state legislature on December 18th to discuss Governor Deval Patrick’s proposed casino plan.

Donald Trump and the CEO of Harrah’s, Gary Loveman, are among the speakers invited to appear before the legislature’s committee on bond issues and capital assets. Other speakers will include three of Patrick’s cabinet secretaries, economic experts and the state’s revenue commissioner.

The governor announced in September that he wants the state to license three commercial casinos by 2012 but needs the state legislature’s approval. House Speaker Sal Dimasi (D-Boston) approved the committee’s hearing though he is opposed to gambling.

Even the two co-chairs of the committee holding the hearing have differences on gambling. One of the bonding committee’s co-chairs, Rep. David Flynn (D-Bridgewater) wants the legislature to vote on casinos in 2008 and not in 2009, as some lawmakers would prefer. The other co-chair of the committee, Sen. Mark Montigny (D-New Bedford) told the Boston Globe, “It’s of no help to us if we get a sales pitch from casino interests with a little extra theater from Donald Trump.”

The Mohegan Tribe and their partners announced their desire for a $1 billion casino resort complex in western Massachusetts that would include 4,000 slot machines, a 600-room hotel and a giant retail center.

The Tribe signed an exclusive agreement with Northeast Realty and Pennsylvania Real Estate Investment Trust, a developer of residential and office establishments, to seek one of the state’s proposed commercial casino licenses for a casino on 150 acres of land in Palmer, near the Massachusetts Turnpike in the western part of the state.

Other Articles:

Thursday, December 6, 2007

Mohegan's Casino Bid Still Alive in Kansas

By Ken Davison

Four Indian tribes currently run casinos in Kansas but a law passed last spring would expand gaming in that state by allowing four new major casino-hotels and 2,800 slot machines at three race tracks.

The legislation allows for one major casino in each of four different regions in the state. Wyandotte County/Kansas City is one of the regions.

A total of five groups submitted proposals to build a casino in Wyandotte County, including the Mohegan Tribe. While the Mohegan Tribe and three other groups received zoning approval from the county this week, the Las Vegas Sands Corporation’s zoning application for a $500 million project was rejected.

These four proposals will go through another round of county government hearings next week regarding the economic and community effects of each proposal and will be voted upon on December 13th by the county, determining which of the proposals will be submitted to the state’s lottery commission. The lottery commission has the ultimate authority to select the winning proposal.

The four groups and the cost of their casinos proposed for Wyandotte County are the Mohegan Tribe and their partners Olympia Gaming and RED Development ($770 million), Pinnacle Entertainment ($650 million), Fox Tribes partnering with Kickapoo-Sac Tribe ($300 million), and the Cordish Company partnering with Kansas Speedway ($600 million). The gaming law states that the minimum investment must be $250 million, which includes a $25 million "privilege" fee.

The Fox Tribes and the Kickapoo-Sac Tribe have reservations in the northeast corner of Kansas along with two other tribes, the Iowa and the Prairie Band Potawatomi. In 2004, Governor Kathleen Sebelius approved a compact with the Fox Tribes and the Kickapoo-Sac for a $210 million casino in Wyandotte County but it was not approved by the legislature. Under the compact, the tribe would have shared casino revenues with the state. The four tribes operating casinos in the state currently do not pay the state any revenues from their casinos.

The Mashantucket Pequot Nation recently announced that it was partnering with MGM Grand and the Iowa Tribe to build a casino in another location of Kansas. The Mashantucket's Foxwoods Development proposal is not in competition with the Mohegan Tribe’s proposal. Mashantucket will be in competition with Penn National, the former owner of the Pocono Downs racetrack in Pennsylvania, and two other bidders in Sumner County.

Under the Kansas Constitution, only Indian tribes and the state can operate casino gambling. The constitutionality of the new gambling legislation is currently being challenged in county court and is expected to eventually go to state court. At issue is whether the casinos can be privately owned or whether they must be owned by the state.

The Tribe in the Media

The following was printed in the November 30th edition of the New York Times and is reprinted here for the purpose of illustrating how the Tribe is portrayed in the media.

A Jackpot for Unions?: Organizing Indian Casinos
By The NYT Editorial Board

With unions in a prolonged decline, there has not been a lot of good news lately for the labor movement.

But there was some last month in Connecticut — a modest jackpot, so to speak. Three thousand dealers at Foxwoods Resort Casino — the sprawling Connecticut gambling mecca — voted to join the United Auto Workers. The vote was the first union inroad at either of the two Native American casinos in Connecticut, for good reason: It was only this year that a court decision opened the door to Indian casino workers who want to organize.

The United States Court of Appeals for the District of Columbia Circuit ruled in February that tribes must follow the National Labor Relations Act, which protects employees’ collective bargaining rights. The tribes have long argued that since their casinos are located on reservations, they were subject to tribal law –and exempt from the NLRA.

The Mashantucket Pequot Tribe, which owns and operates Foxwoods, vowed to appeal to the National Labor Relations Board, and possibly federal court, too. Until those appeals run their course, not much will happen at Foxwoods, which has seen far more union organizing than the nearby Mohegan Sun casino, owned by the Mohegan Tribe.

It may seem odd to see the United Auto Workers organizing blackjack dealers, but the union is simply going where the jobs are. Between them, the two Connecticut casinos employ more than 20,000 workers —not just dealers, but cooks, food workers, and other job categories — none of whom belong to a union.

Nationally, tribal gambling employs more than 600,000 people, and takes in an estimated $25 billion a year.It’s only a start, but 3,000 dealers could be a small sign that labor’s fortunes are beginning to change.

Feather News Note: Foxwoods contested the November vote with the National Labor Relations Board on December 3rd, for lack of jurisdiction and alleging improper voting procedures and misconduct. Dealers at Foxwoods voted on November 24th by a margin of 1,289 - 852 to allow the United Auto Workers union to bargain on their behalf with the casino.

St. Regis Mohawk Tribal Court Ruling Upheld

By Ken Davison

The St. Regis Mohawk Tribe could reap billions from a casino that was never built.

The United States District Court for the Northern District of New York denied a motion by a subsidiary of Harrah’s Entertainment, which sought to dismiss about $3 billion in judgments issued against them by the St. Regis Mohawk Tribal Court for interfering with the Tribe’s planned casino in the Catskill Mountains in New York. Park Place but was the company that is alleged to have interfered but Harrah’s bought out Caesars, who had previously bought out Park Place.

At the time a key federal approval was received for the Catskills casino, Park Place allegedly induced chiefs of the tribe to switch casino management companies, which forced the tribe to begin the federal application process over again and resulted in an aborted casino project. The plaintiffs state that a casino would have been built had Park Place not interfered.

Harrah’s never showed up in tribal court so a default judgment for about $1.8 billion was issued against them. Since then, the tribal court has added about $1 billion in interest costs and reimbursement for court house postage costs, bringing the total to about $3 billion.

Former New York State Attorney General Dennis C. Vacco, a trustee for an entity representing the plaintiffs, commented “We are pleased with this ruling denying Harrah's motion to dismiss the complaint. The Tribe deserves to have its institutions respected and also deserves to have the decisions of the Tribal Court honored by the federal courts."

The tribe is still seeking to build a casino in the Catskills and is now waiting for land it owns there to be placed into federal trust.

The St. Regis Mohawks filed a federal lawsuit last month to compel Secretary of the Interior Dick Kempthorne to to put about 30 acres into federal trust for its proposed casino in the Catskills. The lawsuit asked the U.S. District Court in Washington, D.C., to order Kempthorne to make a decision on the tribe's application within 30 days. The tribe alleges that Kempthorne's personal opposition to off-reservation gaming is interfering with his legal responsibilities. When Kempthorne was the governor of Idaho, he was opposed to off-reservation casinos.

Kempthorne has been reported as saying that if he approves one of the off-reservation casino applications, then he has to approve them all.