State governments like casinos because they fill the capitol’s coffers with revenue. At least that’s what they’re supposed to do. But something’s gone very wrong in Delaware. Gov. Jack Markell‘s administration — having an extra $50 million on hand — is proposing to float an $8 million subsidy to the state’s three racinos, groaning under new competition in neighboring states and a 36% tax rate, two factors that are highly unlikely to change for the better.
But what Markell gives with one hand, he takes with the other. The $8 million is “temporary” relief. Lowering the tax rate is off the table. “The 
administration has not supported changing the tax structure permanently, but recognizes that forcing the casinos to bear additional costs will make them less competitive at a time when they need to be more competitive with casinos in surrounding states,” said Markell spokeswoman, Cathy Rossi. I’m of two minds about this. On the one hand, casinos accepting government handouts look pathetic. They are, after all, profit-making enterprises in which the odds always favor the house. However, states where government controls the amount of capacity and competition (such as Delaware) have an obligation toward the casino industry’s financial health. Markell and the Legislature should shave a few points off that tax rate or else the sad, present scenario is likely to keep repeating itself.
Wynn makes influential friend. An editorial in The Boston Globe tiptoes right up the edge of outright endorsing Wynn Resorts for the Boston-area casino license. It makes a few, pro forma cavils but the stemwinder’s prevailing tone is that it likes what it’s seen of Steve Wynn. Nearby, a walkout by Suffolk Downs and Caesars Entertainment seems to have had the desired effect of bringing East Boston politicians to their knees in supplication.
Penn National Gaming, having so far lost out on Springfield, continues t
o orbit western Massachusetts, vaguely indicating continued interest in the market. However, having passed on Chicopee, Penn’s opened the door to two dark-horse rivals. One remains undisclosed but the other is Neil Bluhm‘s Rush Street Gaming, which recently cut ties to Worcester. The already-stiff competition becomes much hotter if Bluhm pitches a major project for Chicopee.
To the southeast, if the Mashpee Wampanoags ever surmount the multiple hurdles between themselves and a casino, Middleboro is having second thoughts and hopes to wrest it away from Taunton. However, hitting up the Mashee Wamps for $750,000 in allegedly unpaid bills might not be the best negotiating tactic.
