Tribes are often lukewarm on online gambling

Foxwoods To Connecticut Legislature: Legalizing Online Gambling Is State’s ‘Strongest Opportunity’

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A public hearing on expanded gaming opportunities took place in Connecticut on Thursday, and evidence that the state is a strong candidate to legalize online gambling continues to pile up.

Everything from sports betting, to commercial casinos, to online casinos was discussed during the hearing by lawmakers, elected officials, members of the public and representatives from Connecticut’s tribal casinos.

Written testimony submitted by Foxwoods Resort Casino not only supported CT online gaming and sports betting, it called online gaming the “strongest opportunity for the state.”

You can read the full testimony here.

It’s unequivocal verbal support for online gambling from a tribal casino, which is often hard to come by. Foxwoods is owned and operated by the Mashantucket Pequot Tribal Nation. Of course, the Mohegan Tribe — which operates the Mohegan Sun in CT — already operates a branded online casino in New Jersey, as well.

The testimony was delivered by Seth Young, Foxwoods’ executive director of online gaming: “As we see it, the strongest opportunity for the state is in legalizing statewide iGaming, another activity that is currently operating for Connecticut residents in the black market today.”

Young noted that certain types of online gambling are already legal in the state, including off-track betting operations and the daily fantasy sports law passed last year, but is contingent on agreements with the tribes.

How online gambling will benefit the state of Connecticut

Young explained why online gambling would be beneficial to the state by pointing out the potential tax revenue and jobs Connecticut could expect based on New Jersey’s experience:

“Since iGaming was introduced in New Jersey in 2013, New Jersey has collected more than $126M in tax revenue. We project the revenue opportunity for iGaming in Connecticut to be greater than the revenue opportunity for sports gambling. Based on our estimates coupled with a pragmatic tax rate, over the course of five years Connecticut stands to collect roughly $87M in tax revenue from iGaming, at a rate starting at roughly $14.25M in Year One, escalating to roughly $20M in Year Five.


“A study by the iDevelopment and Economic Association estimates 3,374 full-time equivalent jobs were created in New Jersey directly or indirectly since the introduction of iGaming in 2013. The regulated New Jersey iGaming market has had no reports of replacing people with computer servers. In fact, dozens of jobs were created directly as required by regulation, along with hundreds of additional jobs to support the market.

“Further, as iGaming revenue has proven to be incremental to land-based operations, it is more likely that additional jobs will be created within a casino to manage both an online business and to address the needs of the brick-and-mortar establishment because of the online offering.”

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How online gambling will support CT’s casinos

Young also made it clear that online gambling would benefit Connecticut’s casinos in what is becoming an increasingly competitive market. Once again, Young pointed to the positive impacts the addition of online gambling has had on Atlantic City’s land-based casino industry:

“There are strong ancillary benefits of a legalized, statewide online gaming program for land-based casinos, and by proxy the state of Connecticut. iGaming has shown to be incremental – not cannibalistic – to land-based gaming revenue, with data showing that iGaming encourages increased visitation to land-based properties. In fact, in 2016 Atlantic City casinos turned around from a decade-long decline in gaming revenue, and the overall Atlantic City casino market grew by 2.2% from 2016 to 2017.

“Since its introduction, iGaming has grown significantly as a percentage of land-based revenue in New Jersey. In 2013, iGaming made up 0.3% of New Jersey’s overall Net Gaming Revenue. In 2017, iGaming made up 10% of New Jersey’s overall Net Gaming Revenue, driving a total of $245.6m in new revenues. iGaming has contributed to Atlantic City’s stabilization and turnaround in a market with new casinos right over the border in Philadelphia and other neighboring states, in a similar destination-style market as we have here in Connecticut.

“With this in mind, we submit that iGaming is a valuable asset that can be leveraged, with the potential ancillary benefit of increasing slot revenue to the state.”

“Further, iGaming engages a new kind of customer, something that will be vitally important to the continued success of the land-based casinos. David Satz, the Senior Vice President of Government Relations at Caesars, told the Pennsylvania Democratic Policy Committee that 91% of their online players are new customers that were not in their total rewards program prior to the launch of iGaming. This sentiment was echoed on the record by other New Jersey operators, including the Tropicana, Golden Nugget, and the Borgata.”

Connecticut is getting serious

The written testimony by Foxwoods is the latest sign that Connecticut should be considered a serious contender to pass online gaming legislation this year.

New York and Michigan online casino legislation has been in the works for years. Is Connecticut going to get on board that train? It’s starting to look that way. With luck, online poker in CT would become a reality at the same time.

- Steve covers nearly every angle of online poker in his job as a full-time freelance poker writer. His primary focus for OPR is the developing legal and legislative picture for regulated US online poker and gambling.
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