Massachusetts gaming issue sparks heated debate
The debate in Massachusetts over legalizing casinos has turned into an old fashioned game of political football.
The state’s house and senate approved a bill over the weekend that would allow for three casinos and two slot machine parlors.
However, Gov. Deval Patrick is opposed to the legislation because the state’s four racetracks would compete for the slot parlor licenses. Patrick, a Democrat who is facing re-election in November, says he won’t sign the bill.
Patrick said the slot machine parlors generate fewer jobs than the numbers promised by the casinos.
Rather than veto the bill, which could kill the legislation, the governor said he would return the bill, which would give lawmakers a chance to consider amendments to eliminate one of the slot machine facilities.
“I expect to send it back on an amendment,” Patrick was quoted as saying by several Boston-area media outlets. The Legislature would need to the return in special session to take up the changes.
Patrick has 10 days under state law to act on the bill.
The proposed slot machine parlors seem to spark the most heated rhetoric in the debate. The Senate president opposed the slot machines but the House speaker, whose district is home to two of the racetracks, demanded their inclusion.
The governor’s political opponents immediately reacted to the move.
Independent gubernatorial candidate Timothy Cahill said Patrick would cost Massachusetts up to 15,000 jobs if he did not accept the bill. Republican gubernatorial contender Charles Baker favors one casino to test the demand for gambling in Massachusetts, but he has also backed the slot parlors.
Wall Street is watching action because the result could have large financial implications for Nevada’s leading casino operators and slot machine manufacturers.
Janney Montgomery Scott gaming analyst Brian McGill thought between 6,000 and 9,000 slot machines could be utilized in Massachusetts.
“We also think that the potential resort-style licenses offered by Massachusetts would generate substantial interest among some of the casino operators in our coverage, particularly the license that would be located in or around Boston,” McGill told investors.
Las Vegas Sands Corp., Harrah’s Entertainment and Wynn Resorts Ltd. have both quietly and overtly expressed interest in the potential Massachusetts’ casinos, which would heavily cut into the business drawn by American Indian casinos in neighboring Connecticut.
Las Vegas Sands Chairman and Chief Executive Officer Sheldon Adelson is a native of the Boston-area. Harrah’s CEO Gary Loveman was a professor at the Harvard School of Business, owns a minority interest in the NBA’s Boston Celtics, and still lives in the Boston area.
Deutsche Bank gaming analyst Andrew Zarnett thinks there is too much support for gaming in Massachusetts for the issue to die.
“While a line has been drawn in the sand, we believe the overwhelming support of state legislators and essentially the governor in his support of three casinos and one racino means, in our view, that both parties will work towards a amenable solution,” Zarnett told investors.