UNCASVILLE, Conn. - A plan to license three casinos in Massachusetts could set off a gambling arms race between bordering states, researchers at the University of Connecticut said yesterday during a forum on the changing landscape of New England's gambling market.
Several panelists at the forum, held in a Mohegan Sun conference room steps from slot machines and gaming tables, said Connecticut should consider licensing at least one more casino to protect itself from losing revenue to its neighbor to the north.
"The concern is that the new Massachusetts casinos won't just satisfy an untapped market, but will also steal away patrons from Mohegan Sun and Foxwoods," said Steven P. Lanza, executive editor of the Connecticut Economy, a quarterly review that yesterday released a new issue called "Place Your Bets: Massachusetts Ups the Ante." "It's in the state's interest to think about this more actively and creatively than they are right now."
The report, which was funded in part by the Mohegan Tribe, says casino revenue from Foxwoods and Mohegan Sun returned to the state of Connecticut has leveled off at around $430 million after years of rapid growth. Researchers suggested Connecticut should license a casino near its northern border, to compete with any western Massachusetts casino.
"We should do it preemptively, rather than wait," Arthur W. Wright, a professor emeritus of economics at the University of Connecticut, said during the 90-minute presentation and panel discussion. "Once there are Massachusetts casinos, it's going to be harder to do anything in response. . . . The question is, is it possible to block at least one of the three casinos from ever being built?"
Building a third casino in Connecticut would involve big hurdles, however. Most of all, it would require renegotiating the 1990s agreements the state signed with the Pequot and Mohegan tribes to let them open Foxwoods and Mohegan Sun. Under that deal, the state gets 25 percent of slot revenues.
Researchers yesterday also released data showing that reported crime and traffic accidents are no higher 1 mile from the casinos than they are 100 miles away. Home values are also higher in closer proximity to the casinos, according to the report.
Several legislators said the findings were incomplete, and criticized them, saying they did not highlight infrastructure problems and the added burden local schools have felt with an influx of new casino employees and their children.
"I'm highly opposed to Connecticut becoming the casino capital of the world," said state Senator Andrea L. Stillman. "We need to continue to look at the social impacts of the people in this state."
Connecticut's casino industry is stirring in reaction to the proposal by Governor Deval Patrick of Massachusetts, who filed legislation in October that would license one resort casino in Western Massachusetts, Southeastern Massachusetts, and metropolitan Boston. A major factor driving the debate in Massachusetts is the estimated $900 million that Bay State residents spend annually at the Connecticut casinos. That means Massachusetts residents are contributing $120 million to Connecticut coffers.
Connecticut has a strong incentive to fight to keep its market share. About 2 percent of state revenues now come from casinos.
Also, just as Massachusetts communities rely heavily on lottery revenue, Connecticut communities have grown used to reaping the financial benefits of the casinos. A portion goes to cities and towns through a formula, which this year ranges from $18,200 for Weston to $10.6 million for New Haven.
As state officials examine ways to protect their casino revenue, the Connecticut tribes have been actively scouring Massachusetts for casino locations to maintain their dominance in the New England gambling market.
The Mashantucket Pequot and
"We'd love the opportunity to come to Massachusetts and have a business there," said Bruce "Two Dogs" Bozsum, chairman of the Mohegan Tribal Council. "Like everybody else we're waiting to hear what's going to happen . . . now that the governor has come out with a plan."
He also said members of the gaming industry are "a little concerned" about the expensive license fees - the governor wants bidding to start at $200 million - and a renewal every 10 years.
"It kind of scares you to say, 'Boy we'd have to build more than a $1 billion facility to get something back on it,"' he said. "Things will change a bit, but we'd be honored to be chosen as one of the people to come to Massachusetts."
Bozsum also said he doesn't believe Massachusetts would cause saturation in New England gaming.
"We haven't even reached a halfway point," he said. "That's why you see both casinos taking a proactive approach now and expanding on what we have."
Matt Viser can be reached at maviser@globe.com.
