MGM plays games with tribes, MGM Springfield, as Zinke steps in it

As various non-gaming related scandals gain critical mass around ersatz geologist and Secretary of the Interior Ryan Zinke, he’s found himself front and center in a casino mess in Connecticut. Seems that Zinke turned a deaf ear to career Interior employees who recommended approval of Foxwoods Resorts Casino and Mohegan Sun‘s satellite casino in East Windsor, in an apparent effort to get in the good graces of MGM Resorts International. (Zinke has aspirations for electoral office in his native Montana and may have had visions of MGM donations dancing in his head.) Zinke’s decision to punt the staff recommendation into a permanent holding pattern has Connecticut’s congressional delegation demanding that the Interior Department‘s inspector general look into the matter.

According to Politico, heavily redacted documents “show that the career staffers were circulating what they labeled ‘approval’ letters just 48 hours before their political bosses reversed course and refused to either OK or reject the tribes’ application — a nondecision that left the Indians’ East Windsor project in legal limbo.” Zinke evidently put more weight in MGM lobbyist Gale Norton‘s recommendations than those of his own staff. Nevada Sen. Dean Heller (R, left) and Rep. Mark Amodei (R) also got their oars in, according to Politico. “Something clearly happened to pollute the process, which should be problematic for an administration that promised to drain the swamp,” said Mohegan/Foxwoods spokesman Andrew Doba. The soft underbelly of the Interior Department seems to have been Associate Deputy Secretary James Cason, who first wanted “some changes,” then had the word “approval” stricken from the Interior correspondence in question, all the while playing footsie with parties supportive of MGM.

Cason held meetings with Amodei and Heller in the days leading up to a crucial, Sept. 15 meeting with Zinke, where the non-policy toward the Mohegan and Mashantucket Pequots seems to have been codified. (The latter have been the target of one of Donald Trump‘s many racist remarks, “They don’t look like Indians to me.”) The matter may have even had White House input, as Cason and Zinke went from their confab to a meeting with Rick Dearborn, Trump’s deputy chief of staff for policy. The same day, Acting Assistant Secretary for Indian Affairs Michael Black sent his now-infamous letter to the Pequots and Mohegan saying Interior’s input was “premature and likely unnecessary,” leaving the East Windsor project in legal limbo. (Tribal-instigated litigation is currently underway.) Kathryn Rand, dean of the University of North Dakota Law School really put her finger on it when she said, “This is an unusual situation, and we’re kind of pushing the bounds on IGRA.” All the more reason to demand transparency from Interior.

In the meantime, MGM may be playing its own game with the tribes, using MGM Springfield as bait. Assuming it purchases Wynn Boston Harbor, it will have one Massachusetts casino too many. In which case, MGM’s objections to off-reservation gambling might suddenly vanish and the two Connecticut tribes would emerge as frontrunners to purchase MGM Springfield. Don’t take my word for it: It’s a theory being put forward by Union Gaming Group analyst John DeCree. “We believe some combination of Mohegan Sun/Foxwoods and a REIT would make the most sense for Springfield. It would eliminate an immediate competitive threat to the Connecticut casinos and offer a growth opportunity without development risk.” And, wouldn’t you know it, MGM just happens to have a REIT.

However … gaming analyst Frank Fantini cautions that Massachusetts politicians and regulators might not be so keen on this scenario. Foxwoods and Mohegan Sun were already rejected for Bay State casinos, and  the establishment might not “want someone who has a built-in conflict of interest because they are trying to protect their flagship properties in a neighboring state … Not to mention how upset the Connecticut legislators who passed a bill and went through all that turmoil to let them build that casino in East Windsor.” Also, would MGM lose interest in Bridgeport if it gained Boston, or would it redouble its efforts to get a casino in the Nutmeg State? If Mohegan/Foxwoods pulls a switcheroo on Connecticut, the Lege might give MGM a Bridgeport casino purely out of spite.

Eldorado Resorts, which has been growing exponentially this year, might also be tempted to gobble up MGM Springfield, especially if MGM sells the $960 million project at a discount. Penn National Gaming — which Springfield city fathers previously rejected — and Boyd Gaming are also frequently mentioned as suitors. Wouldn’t it be ironic if MGM and Boyd effected a de facto trade of Borgata for MGM Springfield? Farther back in the pack are Caesars Entertainment — already drop-kicked once from the Bay State — Las Vegas Sands (very unlikely, in our opinion) and Genting Group, which would probably find it easier to buy a finished casino than to build one from scratch *cough* Resorts World Las Vegas *cough.*

* The big just get bigger. The Stars Group, parent of PokerStars, has plunked down $3.5 billion to absorb Sky Betting & Gaming. The deal will make Stars Group the largest publicly listed online gaming company in the world, according to The Guardian. It also, by process of succession, will make Stars Group the sponsor of the English Football League. Said Stars CEO Rafi Ashkenazi, “SBG operates one of the world’s fastest-growing sportsbooks and is one of the United Kingdom’s leading gaming providers.” In other words, it was ripe for the plucking.