As Connecticut lawmakers prepare to consider Gov. Ned LaMont’s latest budget bill, gaming stakeholders say this could be the first concrete step toward legalizing sports betting and multiple forms of iGaming in the state. Tribal interests and the state have been in negotiations for several years to legalize sports betting, and the tribes have been unwilling to budge off of exclusivity all along.
“We’re actually in a pretty decent spot after the governor put [gaming] in his budget and released a placeholder bill,” Rodney Butler, chairman of the Mashantucket Pequot Tribe, told Sports Handle. “That’s the furthest we’ve ever gotten, so that’s a good thing.”
On Feb. 11, Lamont introduced his budget, which includes sports betting, iGaming, iLottery, and iKeno while projecting a $50 million windfall for the state as early as 2022. The budget bill, SB 888 and HB 6443 are set for a hearing Friday in the Joint Judiciary Committee.
“Connecticut’s embrace of on-line gaming and lottery is a large step toward broader adoption of mobile gaming in the United States,” Harold Glazer, Scientific Games head of government affairs and special initiatives, said in a statement to the media earlier this month. “Forty-four states now have land-based casino gaming and lotteries, and mobile gaming is the logical extension of those programs in a world going digital. The pandemic is accelerating the trend to on-line play. … Connecticut’s move shows that states are starting to catch up to what their population is demanding.”
Tribes already pay significant slot revenue
Butler’s tribe along with the Mohegans have had exclusivity for gaming in Connecticut since it was approved in the 1980s, and the tribes pay the state 25% of slot machine revenue annually. But ever since the Supreme Court overturned the Professional and Amateur Sports Protection Act in 2018, there has been dispute over how sports betting should be handled, and commercial interests have tried to stake their claims.
— Talk of Connecticut (@talkofct) February 16, 2021
Since Lamont became governor and the COVID-19 crisis changed how business gets done pretty much everywhere, it’s been looking more and more like the tribes and the state are finally close to an agreement. One hurdle removed was the tribes’ interest in building a casino on non-tribal land in East Windsor, which was tabled at least in part due to the pandemic. At about the same time, MGM, which had been talking about building a casino in Bridgeport if the tribes got their East Windsor spot, withdrew its interest in that venture. In addition, after Lamont replaced Daniel Malloy as governor in 2019, the tribes have found “more of a partner” in the governor’s mansion.
All along, Sen. Cathy Osten has been trying to move a tribal sports betting bill through the legislature. Her bill is still active, along with Lamont’s offerings. The Joint Committee on Pubic Safety and Security has put Osten’s bill and its House counterpart on its agenda for Tuesday, March 2.
‘We’ve been trying to negotiate terms’
Connecticut lawmakers do love their hearings — there have been a handful, most of the marathon variety in the last few years. The general tone in the past has been adversarial. In 2021, it should be less so.
“We’ve been trying to negotiate the terms,” Butler said. “All things are leading to that this should be the year that the tribes and government get sports betting across the line after all of the foundational work we’ve done in the past.”
In late December, the Mashantucket Pequot Tribal Nation, which operates Foxwoods Casino Resort, announced a sportsbook partnership with DraftKings, pending state legalization and approvals.
There are still lots of questions to work out, not the least of which are tax rates, revenue sharing, and exactly where sports betting could be offered. The tribes are aiming for a broader bill that will also include iGaming, iKeno, and iLottery, in an effort to expand their portfolios. But including all the options would also benefit the state via revenue sharing.
Connecticut can’t directly tax the tribes for either sports betting, iGaming, or iKeno (iLottery would be run by the state), but it most certainly will look to work out an attractive revenue-sharing agreement, though it likely won’t be at the 25% rate the state currently gets from tribal slots.
“The governor’s bill really set a broader marker as opposed to what other states are looking at,” Butler said. “IGaming, iLottery, iKeno and sports betting. It’s a broader expansion than other states are looking at, so we’re encouraged.”
Don’t expect a Michigan-style deal
Since the fall of PASPA, the only tribal state to legalize iGaming alongside sports betting is Michigan, where a dozen tribes agreed to be regulated and taxed by the state. It’s a unique situation that doesn’t exist anywhere else in the U.S. But only one month post-launch of both wagering and iGaming platforms in the state, it’s far too early to draw conclusions.
Connecticut’s tribes likely won’t agree to a Michigan-style package, but they do want to strike an agreement for expanded digital gaming and wagering.
“We’ve always said, this can’t be just about sports betting, it has to be a full package,” Butler said.
And it’s looking more and more like it might be.