SalemNews.com, Salem, MA

April 18, 2014

Casino firm asks Mass. to delay fee collection

BY PHILIP MARCELO
Associated Press

---- — BOSTON — With efforts to repeal Massachusetts’ casino law underway, MGM Resorts International has asked state regulators to delay the collection of casino fees from the company even as it prepares to become the state’s first licensed casino operator.

MGM Springfield President Michael Mathis said yesterday that the Las Vegas-based company risks losing about $200 million in fees, deposits and other payments if a referendum to repeal the state’s 2011 casino law is put before voters in November and passes.

“No corporation should be expected to subject itself to such risk,” Mathias said in a letter to the state Gaming Commission.

He said the commission could award the casino license for the state’s western region by June, as is now anticipated. But Mathis suggested the commission hold off on going forward with the process — which would, among other things, trigger the payment of an $85 million state licensing fee — until the repeal effort plays out.

The proposed ballot question is pending before the Massachusetts Supreme Judicial Court. Oral arguments are set for May 5, and the court is expected to rule by July.

“Repeal the Casino Deal,” the group pushing for the anti-casino referendum, said MGM’s request signals that the “landscape for casinos has shifted” in Massachusetts.

“The $85 million application fee isn’t much to a company which earned nearly $1 billion off the backs of its customers last year,” John Ribeiro, the group’s chairman, said in a statement. “But it is telling that our grass-roots movement has made them blink about this bad bet.”

Delaying MGM’s licensing payments would affect state finances, at least in the short run.

The state budget for the fiscal year ending June 30 anticipated $195 million in casino-related licensing fees, including $25 million from a slots parlor and $85 million for two new casino licenses, one in eastern Massachusetts and another in western Massachusetts.

The state has received a $25 million licensing fee for a recently licensed slots parlor in Plainville and had hoped for payment of the $85 million licensing fee for the western Massachusetts casino by June 30.

Officials had already assumed the state would not see the eastern region casino’s licensing fee by the close of the fiscal year. That process has been delayed by Boston Mayor Martin Walsh’s bid to get the city designated as a host community for casinos proposed in Everett by Wynn Resorts and in Revere by Mohegan Sun. The host-community status allows for citywide referendums on the proposals.