Two federally recognized Indian tribes are located within the borders of Connecticut:  the Mohegan Tribe of Indians of Connecticut and the Mashantucket Pequot Indian Tribe.  The Mohegan Tribe, through its economic development arm Mohegan Gaming & Entertainment, operates the Mohegan Sun Casino in Uncasville, Connecticut, and is a developer and operator of casino resorts around the United States.  The Mashantucket Pequot operates Foxwoods Resort Casino in Ledyard, Connecticut, less than 20 minutes away from Mohegan Sun, and recently announced it would invest $12.5 million in a new San Juan, Puerto Rico casino.  Both tribal facilities are within two hours of the huge New York City market and offer Class III casino games, pursuant to a Class III gaming compact with the State.

While the two tribes have historically competed for brick-and-mortar casino patrons, they have also come together to plan a $300 million jointly-owned third casino in East Windsor Connecticut named Tribal Winds at the halfway point between New York City and Boston.  Tribal Winds would operate outside of the traditional Indian Gaming framework pursuant to the Indian Gaming Regulatory Act of 1988 (“IGRA”) and would operate under a special license from the state.  However, because both tribes’ existing facilities were closed for three months in 2020 and have been operating at limited capacity since then, the tribes issued a joint statement in December 2020 that they would temporarily set aside their plans for the East Windsor project, but promise to revisit the project once markets improve.

In the meantime, the tribes have been working with Connecticut Governor Ned Lamont to expand sports wagering in the state.  The tribes’ compacts currently provide that the state would not expand gambling, and in return, the tribes compensate the state for this gambling exclusivity with 25% of slot machine revenues.   Earlier this month, the Mohegan Tribe and Lamont announced that they had reached an agreement for the tribes and the state to offer sports wagering and internet casino gaming, offending the Mashantucket Pequot Tribe which was also in negotiations with the state.  The Governor’s office responded that both tribes had been offered the same terms and urged the Mashantucket Pequot tribe to join the deal.  On March 18, Governor Lamont and the leaders of both tribes announced they have entered an agreement bringing online casino gaming and sports wagering to Connecticut.

Under the deal, the tribes will offer online casino games and mobile sports wagering throughout Connecticut, pay 18% of online gambling revenue, growing to 20% after five years, and pay 13.5% of sports wagering revenues.  The State Lottery would offer mobile sports wagering only.  All of the mobile games would be geo-fenced to limit play to players within Connecticut. The lottery would also be allowed to open 15 physical retail sportsbooks at pari-mutuel racetracks.

Because the deal would require revisions to the tribes’ Class III gaming compacts with the state, the amendments would require approval by the United State Secretary of the Interior.  Such amendments would likely be approved.

Sports wagering expanded beyond Nevada in 2018 after the Supreme Court struck down the Professional and Amateur Sports Protection Act, which banned states from enacting new laws allowing sports wagering, as unconstitutional because it allowed the federal government to order certain states to take specific actions to disallow sports gambling, which impermissibly interfered with those states’ regulatory powers in violation of the 10th Amendment.

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About the Author:

Patrick Sullivan is an Associate in the firm’s Washington, D.C. office. His law practice spans federal litigation, Indian and commercial casino gaming regulatory matters,  lobbying and legislative policy, advising tribal, state and municipal government clients in government-to-government negotiations, and supporting  investments and transactions through contract drafting and negotiation. Patrick can be reached at 202-659-6929 or psullivan@dickinsonwright.com and his firm bio can be accessed here.

The post Mohegan and Mashantucket Pequot Tribes Reach Agreement with Governor to Bring Mobile Sports Wagering and Internet Gambling to Connecticut appeared first on DW Gaming and Hospitality Practice Blog.