What you need to know
- The Gaming Act allows for up to three destination resort casinos located in three geographically diverse regions across the state and single slots facility competitively awarded for one location statewide.
- The licensing fee for each resort casino will be an $85 million and requires a capital investment, to include a hotel facility, of at least $500 million. The Commonwealth will receive 25% of gross gaming revenues.
- The slots facility, which will hold up to 1,250 slot machines, has a $25 million license fee, and a minimum capital investment of $125 million. The slots facility will be taxed at 40% of its gross gaming revenue.
Resort Casino and Slot Parlor Development
The Gaming Act allows for up to three destination resort casinos located in three geographically diverse regions across the state and single slots facility competitively awarded for one location statewide. The legislation divides the state into three regions to include: Region A (Suffolk, Middlesex, Essex, Norfolk and Worcester counties), Region B (Hampshire, Hampden, Franklin and Berkshire counties) and Region C (Bristol, Plymouth, Nantucket, Dukes and Barnstable counties).
The licensing fee for each resort casino will be a minimum of $85 million and requires a capital investment, to include a hotel facility, of at least $500 million. The Commonwealth will receive 25% of gross gaming revenues. The slots facility, which will hold up to 1,250 slot machines, has a $25 million license fee, and a minimum capital investment of $125 million. The slots facility will be taxed at 40% of its gross gaming revenue.
The legislation includes a number of key principles to ensure the successful implementation of expanded gaming. The principles include: a transparent and competitive bidding process, maximum long-term value to the Commonwealth, protection for host and surrounding communities, mitigation for social impacts and costs and ensuring the nation’s best and most rigorous public safety, regulatory and enforcement mechanisms.
Recently MassGaming announced that 11 gaming applicants officially submitted the first application (Phase 1) and the non-refundable $400,000 application fee in a two-phase application process toward the award of an expanded gaming license.
MGC has received Phase 1 applications and the $400,000 application fee from the following entities:
- MGM Springfield
- Penn National Gaming, Inc.
- Plainridge Racecourse
- Hard Rock MA
- Wynn, LLC
- Mohegan Sun
- Sterling Suffolk Racecourse
- Raynham Park
- Mass Gaming & Entertainment, LLC
- PPE Casino Resorts
- Crossroads Massachusetts, LLC
The background investigations of all applicants for Category 1 (resort casino) and Category 2 (slots-parlor) gaming licenses has begun. Each applicant for a gaming license, as well as their qualifiers, will undergo the extensive background investigations to ensure they meet the high standards for good character, honesty, integrity and financial suitability.
MGC has established multiple investigative teams to execute the substantial background investigations. The teams are comprised of gaming experts from the consulting firms, Spectrum Gaming and Michael & Carroll and collectively includes former FBI agents, state investigators, prosecutors, Massachusetts state police troopers, and accountants, all of who have vast experience in all types of investigations, including, but not limited to, background, corruption, organized criminal enterprise and racketeering as well as corporate due diligence and gaming industry backgrounds for the largest gaming entities in the industry.
The due diligence investigations for Massachusetts entity applicants will cover their regulatory history in other jurisdictions, financial stability, compliance plan and history, and recent litigation, among other areas. The investigations for qualifiers – those individuals who are officers, board members or key investors of the applicant – will cover their employment history, criminal record, education, stockholdings and financial suitability, among other areas.
Investigations may take up to six months to complete, dependent on the complexity and number of qualifiers for each applicant.
MGC has made significant progress in planning the regulations necessary for the Phase 2 process, which will focus on an applicant’s site specific plan. Phase 2 regulations are expected to be released Summer 2013.
MGC has also made a determination to first proceed with the issuance of the single slots-parlor license in an effort to speed the licensing process. It is anticipated that the slots-parlor license will be awarded by Fall 2013. MGC anticipates the first resort-casino license to be awarded no later than February 2014.