As another casino giant entered the fray in Eastern Massachusetts, officials at Suffolk Downs, until recently the sole contender for a license in the region, expressed confidence Monday that their application would remain strongly competitive.
“We always knew there would be competition for the resort casino license in our region and that we would have to earn the license,” said Chip Tuttle, chief operating officer of Suffolk Downs, the thoroughbred racetrack that is working with casino giant Caesars Entertainment. “We are doing just that with a world-class proposal that will bring thousands of jobs to the people who need them, keep the new revenue in Massachusetts, and also bring much-needed transportation improvements to the area.”
As late as November, it appeared that Suffolk Downs, which is supported by Mayor Thomas M. Menino of Boston, would have no competition for the Greater Boston license. Then Las Vegas casino mogul Steve Wynn, who had been thwarted in his efforts to propose a casino in Foxborough, set his sights on vacant industrial land on the Mystic River in Everett, where he has proposed a $1 billion hotel and casino project.
Then Sunday, the Globe reported that Foxwoods Resort Casino, long an industry leader in New England, is working with developer David Nunes, who had previously submitted an application for 177 acres of land he controls off Interstate 495 in Milford.
Analysts said the Foxwoods partnership could give new credibility to Nunes’s application and reshape the competition in the east, adding a stark, suburban contrast to urban proposals for Suffolk Downs in East Boston and on the Mystic River in Everett.
“They have a significantly different proposal than what we’ve seen . . . .”Carl Jenkins of CBIZ Tofias, talking about the Foxwoods partnership
“They have a significantly different proposal than what we’ve seen, in a significantly different area with significantly different opportunities,” said Carl Jenkins, managing director for the consulting firm CBIZ Tofias . “It’s going to put them right up at the top.”
Concerns about traffic congestion, space for expansion, and competition with other dining and entertainment options are not an issue in Milford as they would be in Boston, Jenkins said.
However, the Foxwoods involvement could raise red flags for the Massachusetts Gaming Commission, which will scrutinize financial capability and ethical integrity in the first phase of its review, said Clyde Barrow, a casino specialist at the Center for Policy Analysis at the University of Massachusetts Dartmouth.
“I’m not surprised that Foxwoods would want to be involved,” Barrow said. “They do have name recognition, and it’s a favorable brand name in the context of New England gaming. But I think they have a couple of liabilities, too.”
Barrow cited the casino’s restructuring of $2 billion in debt and federal indictments in January of the tribal treasurer and a former tribal chairman on charges of stealing $800,000 from the Mashantucket Pequots, who own the casino.
Scott Butera, Foxwoods chief executive, said the company was “in great shape financially” and would have no trouble making good on its part of the deal with Nunes.
“We’re completing the process of restructuring our debt; most of the heavy lifting is behind us,” he said. “But I would say as we sit here today that we have the financial wherewithal to make a substantial investment in this project.”
Butera said he could not comment directly on the indictments but did not consider them an obstacle.
“That’s a tribal matter,” he said. “I believe the tribe feels those individuals are in good standing, and we don’t feel that would impede on our process to get a license.”
Nunes refused to comment.
Officials with Wynn Resorts did not return calls seeking comment. Menino also could not be reached for reaction.
Nunes filed an application with a $400,000 nonrefundable fee to the state Gaming Commission only 10 minutes before the deadline on Jan. 15. Nunes is allowed to add partners after the deadline, said Elaine Driscoll, spokeswoman for the Gaming Commission.
“It’s not unusual at this point in the process for applicants to be identifying both operational and financial partners,” Driscoll said. However, she added, “anyone new to the table must go through an aggressive suitability investigation” similar to the scrutiny given all other partners.
Foxwoods would run the resort and lend its brand to the site if the application is approved, Butera said.
“We have a customer base in this market that we think we can immediately plug into this property,” Butera has said. “Our brand is very well known in this market and highly regarded.”
Jenkins, the consultant, said Foxwoods probably joined the fray as a way to protect its Connecticut business, which studies have shown attracts one-third of its customers from Massachusetts. Now, instead of losing that revenue, Jenkins said, Foxwoods potentially could serve those customers and others in Milford.
“One way to protect your future is to control your future, and they’re trying to control their future,” Jenkins said.
The Massachusetts Gaming Commission will award up to three casino resort licenses, no more than one in each of three regions in the state. There are four competitors in Western Massachusetts, including a project in Palmer backed by the tribal entity that runs Mohegan Sun casino, the Foxwoods competitor in southeastern Connecticut.
The state has put off issuing a license in Southeastern Massachusetts to give the Mashpee Wampanoag time to pursue a tribal casino under federal law. The first commercial license is expected to be awarded by next February.