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Sunday, March 24, 2013

UPDATED: Casino Chronicles

Welcome to the murky world of Indian gaming and casino gambling
By Will Collette

UPDATE: The Associated Press released a story on March 22 that was picked up by dozens of media outlets (including the Sun and New London Day), reinforcing the points I made in this article about the terrible economics plaguing Indian casinos. Click here to read it).

The third rail of Charlestown politics is gambling, and more specifically, a gaming establishment by the Narragansett Indian Tribe. Anyone who wants to be survive in this town, and to an extent, I mean that literally, must take the oath of opposition to gaming in Charlestown.

I’ve taken that oath, not just for convenience (or fear), but because like many others, I believe a large-scale gaming establishment in Charlestown would irreparably change Charlestown, and not for the better.

Tribal Council member Randy Noka charged the CCA with
But at the same time, I believe two additional things that cut against the grain, especially with the Charlestown Citizens Alliance. First, I believe such a much feared Indian casino is never going to happen here (click here to see my reasoning).

Second, I think it’s time Charlestown reconciled with the Tribe. To do that, we will need to acknowledge and reject the racism that underlies much of the town’s historic relationship with the Tribe. Part of that reconciliation should be some substantive cooperation between the Tribe and the Town on measures to help the tribe and its members prosper.

I raise this sore subject again because there have been a number of recent developments to report that relate to these issues.

One of the main reasons why the idea of a Charlestown tribal casino is so far-fetched involves the simple economics of the casino business.

Mohegan Sun, like Foxwoods, reports drastically
reduced profits
Our nearby casinos – Foxwoods and Mohegan Sun – are well-established, popular gambling destinations conveniently located just off the interstates. However, business at those two casinos has been terrible since the start of the Recession. 

Even with the many signs of economic recovery, their revenues are not springing back. They have cut thousands of workers from their payrolls and profit-sharing to tribal members since the start of the economic slump.

Both venues have just reported historic lows. Foxwoods slot profits are down 24% just in the past month. Mohegan Sun is almost as bad, down 18.6%. Their year-over-year decline is the worst in their histories. 

According to the New London Day, Foxwoods hasn’t seen monthly slot profits so low since December 1996. Mohegan Sun’s tally is the lowest since February 2001.

The Day also reported (“Luck seen running out at region’s two casinos”) that part of the decline is due to a trend among gamblers to not want to travel as far.

Foxwoods and Mohegan Sun have lost Massachusetts gamblers
to the Twin River slot parlor in Lincoln...
A major reason for the decline in revenues at Foxwoods and Mohegan Sun is that Massachusetts gamblers – the largest bloc of patrons at Foxwoods and the second-largest at Mohegan Sun – are now stopping more often at Twin River in Lincoln.

Even more Massachusetts gamblers are likely to save the gas and stop at Twin River when it becomes Rhode Island’s first full-fledged casino after voters approved adding table games last November.

But that bump in business for Twin River will probably only last as long as it takes for the Mashpee Wampanoag Tribe to complete its half a billion dollar casino resort complex in Taunton

The Massachusetts legislature approved three full casinos plus one slot parlor in Massachusetts, and the Taunton site is the furthest along. All four Massachusetts facilities should be up and running no later than 2016.

...But not for long: The Mashpee Wampanoag plan for Taunton
Taunton voters have approved the Mashpee Wampanoag project, the tribe has lined up the financing and it looks like a final deal, one that the US Department of Interior is likely to approve, has been worked out between Massachusetts Governor Deval Patrick and the Tribe.

Imagine Disney World with slot machines and blackjack tables – that’s the plan for the tribal casino in Taunton. It will almost certainly take a huge bite out of Twin River, even though Twin River has a modest head-start as it expands to full casino operations within the next few months.

A new UMASS-Dartmouth study says that because Rhode Island counts so heavily on Massachusetts gamblers to keep Twin River (as well as Newport Grand) viable as Rhode Island’s third-largest source of revenue, these new facilities in Massachusetts are bad news for Rhode Island’s gambling prospects.

Of the 580,000 people who visited Twin River in 2012, 385,000 came from Massachusetts. Only 162,000 were Rhode Islanders. A 2012 study commissioned by the Governor projects a loss of more than 30% of fiscal 2016-17 revenue when the new Massachusetts facilities are due to be open and running. 

Clearly, the huge number of Massachusetts gamblers is what drives the Commonwealth’s casino plan despite the otherwise awful economics of casino gaming. Massachusetts assumes its gamblers will go to its new state-of-the-art facilities and not travel to Foxwoods, Mohegan Sun, Twin River, Newport Grand or Maine's racino. 

Time will tell whether they are right, but all of these factors also make it seem pretty silly to worry about a Narragansett Indian casino some years away in Charlestown's future.

Especially since the Tribe hasn’t asked for one since the early 1990s when were turned down by the Democrats who controlled the Town Council at the time. The Tribe was serious about building a new casino in West Warwick, where local voters thought that would be a great tonic to their ailing community. However, they lost a statewide referendum on that project.

The Narragansetts welcomed white settlers to Rhode Island
Then, the Tribe also wanted to buy out Twin River and run in as a full casino. For reasons I’ve never heard explained, Charlestown’s Special Solicitor for Indian Affairs Injun Joe Larisa worked hard to kill that initiative too. 

If the tribe had succeeded, that would have eliminated any possibility of a Charlestown casino – but then Larisa would have to give up his $25,000 annual retainer from the town to fight anything the Tribe wants to do.

However, there are so many other obstacles to a Charlestown casino that I keep asking why the CCA Party continues to make it a perennial issue – other than for cynical political gain. 

When the Narragansetts received federal recognition, they accepted restrictions that make a casino impossible in the 1978 Rhode Island Indian Claims Settlement Act that gave the Tribe title to 1800 acres in Charlestown. They also relinquished all claims to any other lands – so the persistent rumor that Charlestown property titles are still clouded is simply untrue.

But things didn't work out the way the Tribe hoped
If they wanted to build a casino, they would have to purchase other land and then have that land placed into federal trust, and thus out of the state’s and Charlestown’s jurisdiction. 

When the tribe tried to put 31 non-settlement acres into federal trust for a low-income senior citizens housing project, Charlestown, and ultimately the state of Rhode Island sued. This led to the notorious 2009 Carcieri v. Salazar US Supreme Court decision.

In that decision, the Court’s conservative majority held that Congress was unclear when it enacted the 1934 Indian Reorganization Act whether the law applied to all federally recognized tribes, then and in the future, or only to those tribes that were federally recognized in 1934.

They stripped basic sovereignty rights from the Narragansetts and more than 500 tribes who were recognized after 1934. Since then, some members of Congress and the Obama Administration have tried to pass a “Carcieri Fix” to say that Congress intends federal laws to apply equally to all tribes, regardless of the date of federal recognition.

The Narragansetts' initial land claim (red),
latter expanded to include pink area
The leading proponent of the Carcieri Fix legislation, Sen. Daniel Akaka (D-HI), retired at the end of 2012. However, the new version of the bill has been introduced by Akaka’s protégé, Rep. Connie Hanabusa (D-HI) and Ed Markey who is likely to win the special election in a couple of months to fill the Senate seat of now Defense Secretary John Kerry.

In an interview with Indian County Today, Rep. Hanabusa was asked if she was confident that, this time, a Carcieri Fix might get passed. She was not optimistic:

I don’t know if confident is the exact word. It’s the same basic bill [click here to read] that Sen. Akaka offered when he chaired the Senate Committee on Indian Affairs, and I am hoping it will carry. The concern I have is that we have seen other Carcieri bills offered from the other side of the aisle, and they also haven’t been able to be successful.”

The interviewer noted that even within the Indian community, there are divisions about the language of a Carcieri Fix. Some tribes who already have casinos are not keen about competition from other tribes. Hanabusa sees such divisions – and efforts to amend the bill to placate the tribes with large casinos – as fatal to a “clean” Carcieri Fix bill.

An example of how the rivalry between “haves” and “have-nots” among the tribes shows itself in a recent Senate bill. Sen. Diane Feinstein (D-CA) has sponsored bill (S-477) to amend §2719 of the Indian Gaming Regulatory Act that would restrict the types of properties tribes may use for gambling establishments.

Feinstein’s bill would impose two new hurdles for a tribe seeking to take land into trust for a gambling establishment: (1) a substantial, direct, modern connection to the land if the land is located within a 25-mile radius of the tribal headquarters or other tribal governmental facilities on its reservation, and (2) demonstrates a substantial, direct, aboriginal connection to land.

According to Joe Valandra, a Sicangu Lakota and former chief of staff of the National Indian Gaming Commission, Feinstein’s second restrictioncomes along with nearly impossible review standards to be applied by the BIA.”

So any land acquired by the Narragansett Indian Tribe after October 1988 would, on top of everything else, be bound by these restrictions, which Valandra describes as biased in favor of tribes with existing casinos.
If you use the ruler tool in Google Earth and measure 25 miles out from the tribe’s longhouse, you reach Tiverton to the east, Cranston to the north and past Foxwoods and New London and Norwich to the west.

Approximate tribal land areas before European settlers
Then read up on the complex history of the many tribes that have lived in Rhode Island and nearby Connecticut.

But this potential new federal restriction is but one of many federal laws that any proposed casino would have to meet. 

As I wrote here, the facility would face daunting challenges meeting federal requirements for water, transportation, waste disposal, plus fish, migratory birds and wildlife regulations that would be enforced locally by Charlie Vandemoer, manager of Rhode Island’s National Wildlife Refuges, including Ninigret.

Then throw in the economy, including the terrible market timing. What do you think of the Narragansetts’ prospects of getting a casino anywhere, never mind in Charlestown?

If the CCA Party is really and truly worried that, despite all the problems and barriers, the Tribe might want to try to build a casino in Charlestown, the CCA should prove it by supporting the town’s purchase of one of the key pieces of land where such a facility might be sited – Larry LeBlanc’s 81 acre Whalerock wind farm/affordable housing proposal. In case you haven’t read them, here are my Five Reasons Why Charlestown Should Get Serious about Buying LarryLand.

The CCA Party needs to stop the fear-mongering and the racial undertones that come with it. The tribe and its members are our neighbors. They are an important part of our community yet we treat them as enemies. 

The CCA Party has demanded, as a condition of friendship, that the Tribe signs a binding pledge to forego any future casino ambitions. Yet, for all practical purposes, that is exactly what the Tribe already did when it signed the land settlement agreement