Revised Gambling Bill Filed in Massachusetts

by Lynne Snierson

The horse racing industry in Massachusetts would get a much-needed shot in the arm according to the terms of a new expanded gambling bill filed by legislators Aug. 23.

The bill, which was written after months of negotiations behind closed doors, has the backing of top legislative leaders and the governor. Debate is slated to begin after Labor Day.

The bill would allow three so-called destination resort casinos, which must be placed in separate geographic regions and include a hotel, and a slot machine facility with a maximum of 12,500 machines. The license for the slots parlor would not be guaranteed to an existing racetrack, and all of the licenses would be open to competitive bid.

They will be expensive. All applicants would first have to pay a $350,000 non-refundable fee. Those in the hunt for the casino licenses must make a capital investment of at least $500 million and pay a licensing fee of a minimum of $85 million, and anyone wanting a slots license, which will cost a minimum of $25 million, would have to commit to investing at least $125 million into the facility.

According to the Boston Globe, 9% of the profits from the slots facility would be reinvested in the state’s horse racing industry while 40% would go to the state. But while the casinos would pay the state 25%, there is nothing earmarked for the struggling horse industry at this time.

Earlier this year Suffolk Downs officials announced that the track had entered in a strategic alliance with Caesar’s Entertainment to develop a world-class gaming and racing facility on the racetrack grounds in East Boston. Chief executive officer Chip Tuttle and Christian Teja, vice president of communications and marketing for the track, were out of state and unavailable for comment Aug. 23, but Suffolk officials have long maintained they intend to bid aggressively for one of the licenses and will upgrade the quality of racing significantly if successful.

Moreover, Boston Mayor Tom Menino has been outwardly supportive of a destination resort casino in the city and has mentioned Suffolk Downs as an ideal location.

Gov. Deval Patrick, Senate President Therese Murray, and House Speaker Robert DeLeo, all Democrats, endorsed the new bill. In July 2010 a different bill allowing three destination resort casinos and two slots licenses to be awarded to racetracks exclusively died at the end of the legislative session because the governor opposed the no-bid process and wanted only one slots facility.

De Leo, who represents the district in which Suffolk Downs is located, pushed for slots at existing racetracks.

Under terms of the bill, a five-member Massachusetts Gaming Commission would be established. The governor, attorney general, and state treasurer for would be empowered to appoint commissioners to five-year terms.

A separate gaming liquor enforcement unit to be part of the state’s existing alcoholic beverages agency would enforce the alcohol laws inside the gambling facilities.

In a joint statement, DeLeo and Murray said: “We support this bill and believe that it provides a strongly regulated and commercially desirable framework for establishing a gaming industry in Massachusetts. Expanded gaming will create thousands of construction and service jobs and support our ongoing efforts to create and retain jobs in the Commonwealth. Further, it will serve as a source of new revenue for Massachusetts and help our economy grow.”