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Shirley Leung

Stephen Crosby may regulate a little too well

Stephen Crosby (left) spoke at a 2011 news conference at the State House.

Bizuayehu Tesfaye/AP File

Stephen Crosby (left) spoke at a 2011 news conference at the State House.

Stephen Crosby is perhaps the scariest gaming regulator in America in the scariest state to open a casino.

And that’s exactly where he wants us to be.

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“We knew this would be a tough process,” said Crosby, chairman of our inaugural state gaming commission, over breakfast recently.

Three bidders for the sole slots license have moved to the next round, but with the deadline six weeks away, none of the applicants for the two resort casino licenses has yet submitted a final proposal.

To the casino industry, Massachusetts has been a nightmare. There’s a 250-page application with 197 questions, plus a $400,000 nonrefundable application fee. There’s a rigorous state background check and the host community must vote on whether to allow a casino in its backyard. Another bid, Foxwoods, bit the dust Tuesday night when the town of Milford just said no to gambling. But to casino opponents, the high hurdles make Massachusetts a dream state. Perhaps that’s a sign the process has been too tough.

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Has it been, Mr. Chairman?

“I don’t think so,” he said confidently.

In fact, Crosby reminded me that the commission has rejected just one applicant, Ourway Realty, after state investigators discovered that a key figure in the operation took more than $1 million out of the company.

But did he forget . . . et tu, Crosby? No, he asserts he did not kill Caesars’ plan to open a resort casino in East Boston. Rather, state investigators raised red flags about the company’s relationship with a hotel that had alleged ties to the Russian mob. It was Caesars’ partner, Suffolk Downs, Crosby said, that dealt a death blow to the gaming giant’s vision.

Besides, a little tough love goes a long way in an industry that hooks seniors on slots, creates gambling addicts, and causes so much traffic that host communities need to be bought off with millions of dollars funneled into their parched budgets.

Before Deval Patrick appointed him to the commission two years ago, Crosby was ensconced at UMass Boston as the founding dean of the John W. McCormack Graduate School of Policy and Global Studies. Prior to that, he served in top posts for Governors Paul Cellucci and Jane Swift, including a stint as Cellucci’s secretary of administration and finance. Crosby, 68, said he opposed casinos back then, but now calls himself “pro-implementing the law.”

“Regulation in every industry tends to lose [its] edge over time. You only have to look at financial regulation in 2008,” he said. “It is appropriate to be looking for new blood, new vigor.”

Is Crosby worried the commission may have overplayed its hand and the state will end up with no casinos?

“We are fully expecting at least one quality applicant for each license,” he said.

And in the extraordinary event that a region doesn’t receive a final proposal? Crosby shrugs off the possibility. “We just would do it over again. There are plenty of people who want to do this.”

See what I mean by scary?

What’s even more frightening about the process of opening a casino here is what’s not in Crosby’s control. While everyone had kept a long watch on the Mashpee Wampanoag tribe and its effort to get federal approval for a gaming complex in Taunton, the Wampanoag Tribe of Aquinnah last week unveiled something that seemed as unlikely as hitting the Pick 6 at Suffolk Downs: a claim that it has the federal go-ahead to open the state’s first casino on tribal land on Martha’s Vineyard.

The prospect of not one, but two Indian casinos, threatens to rework everyone’s gambling revenue projections, the state’s included. Still, Crosby plans to give out a third resort casino license in the southeast region, extending the deadline for a final proposal until June.

“We’re in the impossible situation, whether or not there would be a designation,” Crosby said of the Wampanoag tribe and federal approval. “It could be tomorrow or 30 years.”

Here’s another impossible situation: What happens if former state attorney general Scott Harshbarger and other gambling opponents succeed in repealing the casino law? It’s a long shot, but they’re gathering signatures to get on the ballot next fall.

For the first time during our conversation, Crosby hesitated when I asked that question. I think he wanted to throw up his hands.

“I don’t even know,” he said, of what’s next if the casino law dies.

Crosby has been good at his job, perhaps too good. It’s not what the gaming industry wants, but it’s what Massachusetts needs as we warily wade into casinos.

Shirley Leung can be reached at sleung@globe.com. Follow her on Twitter @leung.
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