Massachusetts Stamp

Massachusetts Casinos to be Reconsidered in November Vote

The future of casino gambling and entertainment in one of the most populous of the United States’ northeast states remains up in the air, with voters in Massachusetts set to go to the polls in November to reconsider the state’s 2011 approval via referendum of three casino licenses.

massachusetts-stampOpponents of gambling in the state have redoubled their efforts to reverse the introduction of casinos in the state.  Massachusetts legislators also considered, but discarded, proposals to legalize and regulate online gambling within the state.  Whether the state becomes the first US state to reverse itself in modern times regarding casino authorization remains uncertain; voter polls show that the anti-gambling forces have significantly closed the gap, but that a slight majority of likely voters still approve the planned casinos.

The gambling foes have served up several different arguments in support of their renewed cause, ranging from the historical society ills associated with gambling to the recent floundering of casinos in Atlantic City, New Jersey, where four of the city’s 12 casino have closed or are in the process of doing so, with a total loss of roughly 8,000 jobs.

In the meantime, the casinos themselves are delaying licensing deals and construction plans pending the outcome of the repeal movement.  Only one of the three casino licenses has been officially awarded to date, to MGM Resorts International for a facility in Springfield, but MGM has asked the state’s gaming commission not to officially award that license and demand the first installments of licensing fees until after the November vote.

A fourth gambling license issued by the state, for a slots-only facility in Plainville, is also subject to delay.  Penn National Gaming was awarded that license, and while construction has begun on that site, the slots facility may be delayed by as much as a year before opening.

Another inadvertent arguing point in the gambling opponents’ arsenal of words is the nasty political fight that continues to swirl around the casino complex designated to be built in the Boston metro area.

A Wynn Resorts proposal to build a $1.6 billion casino complex in the inner Boston suburb of Everett emerged as the favorite after the Massachusetts Gaming Commission dismissed the inclusion of Caesars Entertainment as a partner in a rival proposal to refurbish the existing Suffolk Downs pari-mutuel racing complex.  The MGC’s snub of Caesars cited perceived difficulties with a third-party investor, Paul Lohnes, a hotel magnate who has been alleged to have ties to Russian organized crime.

Caesars’ click dismissal from Massachusetts consideration led the company to cry foul and make claims of favoritism by MGC chairman Stephen Crosby.  Caesars filed suit against Crosby last alleging conflict of interest and an undisclosed relationship with Wynn Gaming.  That lawsuit was dismissed in May (Caesars continues with plans to appeal), but Crosby has since the been forced to recuse himself from decisions involving the Boston-area casino license.

Meanwhile,the Suffolk Downs proposal continues on as a rival to Wynn’s proposal, even without Caesars as an investment partner.  Mohegan Sun, which operates several facilities in the region, continues touting its $1.3 billion proposal to revitalize the Revere racetrack facility in preference to Wynn’s hopes to build a new casino complex in Everett.

The in-fighting involved in the process has done nothing but provide more fuel for Massachusetts gambling foes, with the November repeal referendum expected to generate millions of dollars in political advertising in September and October, when the battle is taken to the airwaves.  The repeal effort may remain a slight underdog, but that it still has a fighting chance has to be a major concern to a company such as Penn, which according to a recent NY Times report has already invested $100 million in the construction of the Plainville slots facility.


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  1. Bill

    In this article you mention that Paul Lohnes has ties to the Russian mob. Do you have the source or and back-up information that would corroborate that claim?

    1. I could send you the links to several different Boston Globe stories that explain the link and related backstory. However, since you’re a Boston-area financial analyst yourself, and should already know this, you’re either being intentionally obtuse or really, really lazy.


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