The state gambling commission made its first tentative step toward opening Southeastern Massachusetts to commercial casino development, discussing a proposal Tuesday to accept applications from commercial developers even as the Mashpee Wampanoag continue to pursue a tribal casino in the region.
The commission indicated that it would probably drop the commercial bids if the tribe makes significant progress on winning approval for its casino, creating a potential risk for would-be developers.
To make a pitch in the region, they would have to make a significant investment, including payment of a $400,000 state application fee, in pursuit of a commercial casino license that may never be issued.
“This would pose a calculated risk,” acknowledged commission chairman Stephen Crosby, who also noted that casino companies are in the business of taking odds.
Still, such a move would probably be welcomed by potential commercial bidders, who have been stymied by language in the 2011 law that delays commercial casino development in the southeast to give a federally recognized tribe, presumably the Mashpee, time to make progress on a tribal casino. Tribal casinos are approved under a federal process and do not need state approval.
The Mashpee, who want to build a casino in Taunton, face major obstacles in winning federal approval. Because of the potential for years of delay, gambling commission members are concerned about the southeast falling far behind the state’s other two regions, where multiple commercial developers are competing for casino licenses. The state casino law was never intended “to put Southeastern Mass. behind the eight ball,” said Crosby. Tribal chairman Cedric Cromwell did not respond to a request for comment.
The deference to the tribe is also being challenged in federal court by KG Urban Enterprises, a developer interested in building a commerical casino in New Bedford.
“If the commission were to move forward with a fair and equitable commercial application and licensing process in the southeast that mirrors the process already in place for the other regions, then KG stands ready to compete on a level playing field with any and all other gaming license aspirants,” Andrew Stern, managing director for KG, said Tuesday.
The gambling commission has authority under state law to open the southeast to commercial casino applicants at any time it concludes the Mashpee are unlikely to win federal approval to build a tribal gambling resort.
Commissioner James McHugh, a former judge, will draw up a proposal for accepting commercial applications that would also respect the Mashpee’s continued pursuit of a tribal casino. No vote is expected for several weeks.
McHugh had raised the issue Tuesday in a memo to the full commission that laid out the obstacles facing the tribe, many of which stem from the legal status of the proposed casino site in Taunton.
Tribal casinos can be built only on sovereign Indian land. The tribe has applied to the Department of the Interior to have the Taunton land taken into federal trust on behalf of the tribe, which would make it eligible to host tribal gambling. But the department’s authority to take land into trust is in question because of a 2009 Supreme Court ruling.
Tribal advocates have been pushing Congress to pass an amendment to clarify the department’s authority, and advocates in recent months were optimistic that the amendment could pass the lame-duck session of Congress.
That now seems unlikely, US Representative Tom Cole, an Oklahoma Republican and an enrolled member of the Chickasaw Nation, said in a Globe interview. “We’re at the mercy of issues bigger than ourselves in the lame duck,” said Cole, referring to Washington’s current preoccupation with tax hikes and spending cuts known as the “fiscal cliff.” Also, Cole said, while proponents have made progress lining up votes, they have more work to do.
Federal court cases that could help clarify the issue could be years away from final rulings, and Cole puts little hope in the judiciary. “I would never count on the courts to fix anything.”
The Mashpee Wampanoag also suffered a setback in October, when the federal government rejected a casino agreement the tribe had negotiated with Governor Deval Patrick. The deal had proposed the tribe pay the state 21.5 percent of its gambling revenue in exchange for limited exclusivity to run a casino in the southeast. Federal authorities said the deal took too much from the tribe and offered too little in return.Mark Arsenault can be reached at email@example.com. Follow him on Twitter @bostonglobemark.