A heavy weight fight in Massachusetts

At first glance, the competition for a casino license in Massachusetts may not look like a heavy weight fight, but by the time it is over no one will doubt that it was; those left standing will be scared, but lucky and the those lying on the canvas are sure to be bruised and bloody.  Rounds one, two and three in the Massachusetts casino license heavy-weight-fight appear to be over.  In those first three rounds casinos have been legalized, a gaming commission has been formed and written its regulations (maybe) and now the deadline has passed for applications and now the official contenders are in position to begin the coming rounds.   Eleven hopefuls ponied up $400,000 each for the right to content for a license; in theory those eleven and those eleven will now duke it out to see who will deal the cards and operate the slot machines in Massachusetts.

Several of those applying waited until the very last minute to drop their applications and checks off at the gaming commission office.  Four hundred thousand dollars may not normally be a lot of money to a large casino company, but when all it buys is a ticket to stand in line and is non-refundable it is a lot of money.  The companies who waited until the last day probably had to give the idea some serious thought before writing the check.  The last minute applicants were a bit of a surprise; there were, a couple of local developers, Cordish of Maryland Live fame, a racetrack operator and Pennsylvania and Illinois casino operator Neil Bluhm.  Cordish and Bluhm have some money and some recent experience in this kind of a process, both should prove to be worthy advisories.  They may not be the biggest names on the card, but they are not light weights either.  The rest of card are the really big names; Steve Wynn declared his intent last week – the other big names, MGM, Penn, Hard Rock, and Mohegan Sun have been out in the open sparing for a quite a while now.

What is next and how many rounds are there in this fight?  I have no idea; the commission says it is going to take that $4.4 million and spend it investigating the applicants; that process alone could take anywhere between a year and two years.  Then each of the applicants has to find a community willing to host its casino.  Again it is anyone’s guess how long that will take, but if the debates thus far are any indication it will be a slow and painful process.  And when all of that is done, the commission will get to choose which projects will be licensed.  Then and only then can the prospective operators finalize their plans, financing and begin to build the casinos.  The building should only take a year, or 18 months at the most – so where does that put us?  Down the road, way down the road – 4 years? 5 years?

It is unknown how many rounds there will be in this fight or how long each round will be.  Those eleven who submitted an application and tendered a check are brave; they put up some money, but that will be peanuts compared to what they will spend winning the hearts and minds of the citizens in Boston and other cities in Massachusetts.  The casino companies fighting against each other in Maryland spent nearly a hundred million dollars trying to convince voters to accept or reject another casino in that state.  It won’t cost as much in Massachusetts, but it won’t be cheap and it won’t be easy or fast.  The devil’s advocate in me begs to ask the question: When finally open and operating will the casinos justify the time, effort and expense it took to get to there?

 Crosby called the application deadline a “momentous moment” for the state’s fledgling casino industry. “We’re thrilled to have robust competition,” he said.

The Massachusetts Gaming Commission collected $4.4 million in fees — $400,000 per developer — by Tuesday’s 5 p.m. deadline, Stephen Crosby, commission chairman, announced at a press conference one hour after the deadline passed.  The commission will use that money, Crosby said, to review the backgrounds of the developers “to ensure they meet the highest possible standards for good character, integrity and financial suitability.” Those investigations, which could take up to six months to complete, also will cover regulatory history in other jurisdictions and recent litigation, he said. Employment history, criminal records and educational backgrounds of individuals also will be checked. George Brennan, Cape Cod Times, 1-16-13

 Eleven firms hoping to compete for licenses for resort casinos or a slots parlor filed initial applications …Four groups waited until the final day to submit applications, joining seven others that had previously filed.  A surprise last-minute entry was PPE Casino Resorts, affiliated with the principals of Baltimore-based Cordish Cos…Also submitting an application on Tuesday was Crossroads Massachusetts LLC, which is seeking to develop a casino in Milford but likely will face formidable competition for the sole eastern Massachusetts casino license with Las Vegas casino magnate Steve Wynn, who has proposed a complex in Everett, and the Suffolk Downs thoroughbred track in Boston. Others filing on Tuesday were Mass Gaming & Entertainment, an affiliate of Chicago-based Rush Street Gaming, and a group seeking to open a slots parlor at Raynham Park, a former dog racing track. Bob Salzberg, Associated Press, 1-16-13



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