A consultant hired by Connecticut’s two Indian tribes found that if they only received permission to build a $300 million casino in north central Connecticut, it would generate $300.9 million in gross gaming revenue and create more than 2,000 jobs.
Revenue would be slightly lower if the legislature gives the Mohegan Tribe and Mashantucket Pequot Tribal Nation permission to build up to three new casinos, according to an analysis by Clyde Barrow of Pyramid Associations.
In each of the scenarios Barrow presented in his report, he assumed that a new $300 million casino would have 2,000 slot machines, 50 table games, and 15 poker tables and would be open by January 2017.
East Hartford, Enfield, and East Windsor have all been discussed as possible locations for a satellite casino to stop gamblers who might consider heading further north to the new MGM Springfield casino. But the analysis by Barrow didn’t focus on one town. It focused on the region.
“We identified three generic locations,” along Interstates 91, 84 and 95, Barrow said.
Would there be a difference if the casino was built at the site of a former movie theater along Interstate 84 in East Hartford, as opposed to a former movie theater along Interstate 91 in East Windsor?
“There are going to be some marginal differences, but they’re not going to change the numbers I presented in this report,” Barrow said during a conference call with reporters. “Whether it’s Enfield or Windsor Locks is not going to make a big difference.”
A developer laid out plans for the old Showcase Cinema location in East Hartford and there’s also a vacant Showcase Cinemas building in East Windsor, a town that has invited discussion about locating a casino there.
The key to the success of the new casino is convenience and it’s ability to capture the convenience gambler, Barrow said.
“These are the gamblers who aren’t looking for the bells and whistles,” Barrow said. “They’re not looking for gourmet dining. They’re not going to going to stay overnight. They’re looking to drive 30 to 40 minutes, gamble for two or three hours, and go home.”
He said a majority of the slot machine players are convenience gamblers.
Legislation making its way through the legislature would allow the two tribes to build up to three satellite casinos outside their two flagship casinos on their reservations in southeastern Connecticut.
The three proposed satellite casinos will recapture 87.7 percent of the gaming revenue and 43.8 percent of the non-gaming revenue that will otherwise be lost to new casinos in Massachusetts and New York, including the estimated $252.3 million that Connecticut residents are likely to spend at new Massachusetts and New York casinos, Barrow found.
The three proposed satellite casinos will generate approximately $125 million in gaming tax revenues and an additional $4.4 million in sales and meals taxes.
Barrow’s projections assume that the state would see even more new revenue because the tribes would share 25 percent of its table game revenue with the state. Currently, the tribes only share slot revenue with the state.
Mohegan Chairman Kevin Brown said that’s what it being modeled right now to help the tribes get an idea of what we’re talking about from a revenue standpoint, “but it is not stipulated in the legislation and is an open issue for conversation with the state.”
Barrow’s projections also included job estimates.
After construction, Barrow estimated that three new casinos would generate 4,741 permanent full-time and part-time jobs. Each casino would generate a different number of jobs, with the north central Connecticut one generating an estimated 2,046 permanent full-time and part-time jobs with a yearly payroll of $82.8 million.
Brown admitted that it would be a “monumental” task to have all three casinos up and running by 2017, like the scenario outlined in the report.
Mashantucket Pequot Chairman Rodney Butler said they’ve sent the report to all state lawmakers who need it to make an informed decision on the legislation.
The Office of Fiscal Analysis estimated that it will cost the state $5.8 million in the first year and $6.4 million in the second year of the budget to hire the additional staff in the Department of Consumer Protection to oversee three new gambling operations. Three casinos would require a Gaming Regulation Supervisor and as many as 15 Gaming Regulation Officers. It would also require the hiring of two gaming investigators, two office assistants, two paralegals, and two staff attorneys.
“Additionally the DCP would be required to audit payment functions to ensure the state received the correct revenue. This would require a Supervising Account Examiner and five Account Examiners. Finally, it is assumed that each casino would seek a liquor license therefore resulting in the need for three Supervising Liquor Casino Agents and as many as fifteen liquor casino agents,” the fiscal note states.
But the note also “assumes the opening of Massachusetts casinos will result in a $63.5 million revenue loss to the state in FY 18.”