Following a stinging expose of Mohegan Sun and Foxwoods Resort Casino‘s habit of placing liens on the homes of casino debtors. Massachusetts Attorney General Martha Coakley was moved to action. She is urging the Massachusetts Gaming Commission to prohibit the “deeply concerning” practice in the Bay State. “This story highlights the need for a robust set of consumer protection regulations before these establishments begin operations,” Coakley wrote of the Boston Globe‘s scoop. The timing of the revelations couldn’t be worse for the Mohegan Tribal Gaming Authority, whose casino application is currently before the MGC. (Foxwoods’ Fall River project is in a very nascent stage.)
For its part, the commission has yet to write the rules under which credit is extended. Mohegan Sun, which was sufficiently stung to write a defensive letter to the Globe, issued a public statement, telling Coakley, “We have always indicated our willingness to work with the Gaming Commission within whatever regulatory framework they establish.” So they’ll still come after your house unless the MGC explicitly prohibits it. For her part, Coakley believes that taking away this debt-collection tactic may compel casinos to be more circumspect in extending credit. That would be no bad thing, since it was the two casinos’ own imprudence in issuing markers that got them into the home-lien business.
Mohegan Sun, for its part, is busy trying to change the subject of conversation. The City of Boston has been putting the arm on the Mohegans for host community status. Mohegan Sun CEO Mitchell Etess‘ reply was “sit down and deal with it.” The casino company also contends that having to cram its casino into the Revere half of Suffolk Downs was a blessing in disguise and will generate 10% less traffic.
Etess also went on the attack against Steve Wynn and his various preconditions — particularly with regard to tax rates — for building in Everett. “We’re ready. We don’t need changes to the law,” said Etess, accusing Wynn of demanding special treatment. Etess’ core message was that Mohegan Sun would build, no matter what, but that Wynn might go fly a kite if he doesn’t get what he wants. However, what Wynn did was firmly within the application process, which asks prospective casino owners, “Describe any postlicensing actions by the Commission or the Commonwealth of Massachusetts that you believe will be essential for the success of the project you are proposing.”
Wynn’s mistake — if that’s what it was — was to elaborate upon his proposed emendations during Wynn Resorts‘ most recent earnings call. Reports the Globe, “Wynn’s list recommended changes to the way cash prizes must be reported for tax purposes, and proposed that commercial casinos pay state tax equal to whatever revenue-sharing provisions are paid by a tribal casino, among a number of other suggestions.” The Mohegans, given the opportunity, asked for no changes. Quoth Etess (pictured), “At some point, we felt we needed to point these things out.” That point is probably the one where you realize that you’re losing the game and need to throw a Hail Mary pass in hopes of beating Wynn, whose project has considerably more ‘curb appeal.’ Etess did not fail to point out that Wynn would be building on a brownfield site in need of environmental remediation, of course.
Foxwoods, meanwhile, was busy in the Catskills, where it laid out its proposal for a massive resort near the site of the legendary Grossinger’s. The Mashantucket Pequots aren’t thinking small. The amenities listed for the Catskills project include a spa, an equestrian center, 27 holes of golf, a marina, timeshares and a 400-room hotel … and, oh yes, a casino. And that’s how Foxwoods wants its project to be seen — as a resort that happens to have gambling. Foxwoods’ neighbor, Louis Cappelli, has his own casino project in Monticello. He’s being right neighborly, too, allowing Foxwoods and Muss Development to use his golf course and demolish the dilapidated Grossinger’s building. Foxwoods’ project is only one of six proposed for the Catskills, from which two will be chosen, but it sets the bar pretty high.
Dave, I was hoping that you would point out some irony that Mitchell Etess is a Grossinger! It is how he got his start in the business. Interesting that Foxwoods is moving in on his childhood turf (kind of).