Massachusetts stealth attack...

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SELECTIVE MORALITY IN MASSACHUSETTS

Ban online gambling, but expand state lotto sales and launch land casinos

Network World took a swipe at the selective and hypocritical morality of Massachusetts politicians this week with an op-ed article reporting on the intended expansion of state lottery outlets to the doughnut-and-coffee shop sector.

"You can't play online poker, but go ahead and gamble in Dunkin' Donuts," reads the headline on the piece, which summarises Governor Deval Patrick's attempts to introduce three land casino operations to the state whilst banning any possibility of competition from online gambling. Meanwhile, state lottery officials are looking for bigger and better ways to increase lottery sales.

The Herald story reports that although the plan is in its preliminary stages, state lottery officials have confirmed they have already spoken to Dunkin’ Donuts and are drawing closer to a deal with CVS, which has begun selling scratch tickets in California.

“These are very successful businesses and we would like to partner with them,” said Dan Rosenfeld, a spokesman for the state lottery. “The more agents we have, the more (tickets) we can sell.”

Network World points out that while this is going on, Governor Patrick is "....rattling cell keys at the online poker crowd and....the Massachusetts State Lottery Commission – our officially blessed, multibillion gambling behemoth – is taking yet additional steps to ensure that residents here cannot step outside of their homes without tripping over a game of chance. Not content with the current status of a lottery outlet in every greasy spoon, watering hole, liquor store and Seven-11, the state’s gung-ho gambling purveyors are now targeting donut shops, drug stores and home-improvement centers such as Home Depot."

The article is not against gambling per se, but the hypocrisy is noted: "The state bullying poker players on one hand while squeezing every last dollar out of the proletariat with the other cheeses me off. And, having to drive to Connecticut to play poker on Friday instead of staying nearby – or here at my PC – really cheeses me off," the article ends.

"Would you like a lottery ticket with that latte?"

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MASSACHUSETTS CASINO PROGRAM RE-ENERGISED

Governor Deval Patrick hits the ground running as 2008 opens

Massachusetts governor Deval Patrick is re-energising his controversial campaign to obtain legislative support for three land casinos for the state. Online gamblers are perturbed by a buried clause in the proposed legislation that seeks to ban online gambling in what is seen as a protectionist measure for the proposed new land gambling venues.

This week Governor Patrick was ramping up efforts to pass his casino gambling bill, appealing to labour unions, mayors and other would-be beneficiaries to pressure state lawmakers, and hoping election year politics will help the cause, reports the Boston Globe.

The Democratic governor held strategy sessions with his top advisers in the first days of the new year, leading to the planning of several events around the state.

"Everyone is energized," said Rep. Brian Wallace, a Boston Democrat who is a key Patrick ally on casinos. "Before, it was on the backburner." The discussion among union and land gambling industry representatives is whether to create a formal coalition that would pay for television and radio advertisements, he revealed.

Patrick's proposal, which he claims will raise $400 million a year in additional tax revenues, has evoked strong debate in the state legislature and the media. House lawmakers two years ago rejected a bill to expand legalised gambling, and many representatives remain opposed to casinos, saying the move will alter the cultural and intellectual character of Massachusetts.

Labor unions have been among the strongest supporters of the bill because Patrick estimates that three casinos have the potential to create 30 000 temporary construction jobs and 20 000 permanent jobs. Tens of thousands of union workers across the state can be mobilised to lobby lawmakers, who ignore constituents at their peril in an election year, the newspaper speculates.

Governor Patrick plans to begin meeting with individual House members in a strategy similar to the campaign that took place last year when he and others took a personal interest in preserving gay marriage. Another part of the strategy, lawmakers said, is to persuade mayors and other local elected leaders to pressure undecided legislators.

Among the industry heavyweights showing an interest in building a casino in Massachusetts are Sheldon Adelson of Las Vegas Sands Corp., Gary Loveman of Harrah's Entertainment Inc., Steve Wynn of Wynn Resorts Ltd., and Atlantic City mogul Donald Trump. All four of the racetracks in Massachusetts also want to bid.

Patrick's bill calls for a minimum investment of $1 billion, and would site a casino in each of three regions: the Boston area, southeastern Massachusetts, and western/central Massachusetts.

The governor says Massachusetts residents spend about $900 million annually at neighbouring Connecticut's two casinos. His bill calls for net revenue to be split between fixing roads and bridges and property tax credits for homeowners.

Another argument in favour of casinos is that the Mashpee Wampanoag Indian tribe will soon be able to open a gambling facility. The tribe has applied for federal approval to use land in Middleborough for a casino. Under that scenario, the state could be shut out of any revenues.

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BATTLE OF THE ANALYSTS

Who's statistics are right in Massachusetts land casino debate?

The ongoing fierce debate for and against the building of three major land casinos in Massachusetts entered a new phase this week as rival analyst studies started to play a role.

Governor Deval Patrick's projection that the introduction of the casinos would create 30 000 construction jobs in the state is the latest number to come under the microscope following a newspaper study through an independent economics specialist, with House Speaker Salvatore DiMasi, an opponent of the casinos, claiming that the governor's figures are clearly losing credibility.

The Speaker was basing his criticism on a study commissioned by the Boston Globe newspaper comparing Patrick's assumptions with other New England casinos and an industry standard. The newspaper reported that Gus Faucher, director of macroeconomics for Moody's Economy.com said building three casinos at a cost of $1 billion each in Massachusetts would create a total of 4 000 to 5 000 new construction jobs - not 30 000.

Even a group representing building trade unions - Patrick's major ally in the casino debate - said Patrick's projection was 10 000 jobs too high.

The Governor's economic development secretary said in response that the administration had "confidence in our casino job projections and have hired an independent third-party firm with extensive expertise in the gaming industry to provide an analysis of the governor's plan." This was a reference to the recent engagement by the Governor of Spectrum Gaming of New Jersey - the only group to respond to a tender for a study.

The firm is being paid $189 000 by the state to analyse the governor's plan to license three casinos in Massachusetts and is expected to complete its study within two to three months (see previous InfoPowa report).

Meanwhile, pressure group Casino Free Mass, a coalition of organisations opposed to casinos, called on Patrick to rescind the contract, alleging that the organisation is biased.

In the statement Monday, DiMasi criticised the Patrick administration.

"It seems like we have a proposal where no tough questions were even asked - let alone answered," DiMasi said. "The Governor clearly has the burden of convincing the Legislature that this casino plan should be adopted. So far, the case has not been made, the evidence isn't there and the Governor’s arguments for casinos are clearly losing credibility."

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MASS. GOVERNOR SIDESTEPS HOUSE SPEAKER

And holds meetings with tribal gambling aspirants, too

The increasingly bitter feuding in the Massachusetts state legislature over Governor Deval Patrick's intention to introduce land casinos to raise state revenue levels continued as the week progressed following surveys that cast doubt on the Governor's employment predictions (see previous InfoPowa report)

The issue is being following closely by online gambling observers because Governor Patrick's bill includes a clause that would seek to ban online gambling in the state, making players liable to punitive sentences of 2 years in the house of correction, a fine of $25 000, or both. Ironically, Patrick's H.4307 is pro-casino gambling legislation, yet it makes Internet gaming a crime.

This week Patrick further raised the ire of his chief critic, House Speaker Salvatore DiMasi, by writing directly to all the members of DiMasi's chamber. He criticised their leader for blasting his proposal to license three resort-style casinos after the revelation it might not create the 30 000 construction jobs Patrick had estimated.

Arguing that the "speaker's alternative" was zero jobs, Patrick wrote: "At a time of economic uncertainty, we must be proactive about proposing ideas and reforms that boost economic activity and create jobs. Attacking ideas without proposing sound alternatives is not good economic policy, nor what the public expects or deserves." He did, however, revise his employment numbers downward by 10 000 jobs.

DiMasi spokesman David Guarino said in response: "It's understandable that the governor is concerned since his numbers don't add up and he is losing credibility on this issue."

Meanwhile, aides to Governor Patrick huddled with members of the Mashpee Wampanoag Indian tribe on Tuesday as they sought common ground over plans to bring casino gambling to Massachusetts.

The tribe has expressed interest in applying for one of the Massachusetts casino licenses, but it presently is seeking federal recognition to build its own casino on a 540-acre site it has secured in Middleborough. Patrick has filed a challenge to the tribe's application, which could slow down the federal process, although administration officials are hoping the two sides can work together.

Among those attending the meeting were Dan O'Connell, secretary of economic development, and Shawn Hendricks, the tribe's chairman.

Afterward, Hendricks said the tribe would continue to work with the state but he ultimately thought the two sides would merge their efforts.

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MASS. CASINO DISPUTE LATEST (Update)

Another study tabled

The "Battle of the Analysts" continued this week in Boston, where state governor Deval Patrick and House Speaker Salvatore DiMasi remain locked in acrimonious dispute over the desirability of introducing 3 new billion dollar land casinos to boost revenues and employment.

The latest organisation to table an estimate is the Greater Boston Chamber of Commerce, and it seems to support many of the economic assumptions outlined by Patrick in his much challenged proposal to build three resort-style casinos in Massachusetts.

In the report released Thursday, the chamber says that by 2012 the casinos would generate up to $2.3 billion in gross revenues per year, leaving the state with up to $429 million in tax revenue.

The study also found the casinos would create up to 21 000 permanent jobs and up to 11 500 construction jobs, reports the Boston Globe newspaper.

While Patrick has been criticised for estimating the construction jobs at 30 000, the study bears out his projection of 20 000 permanent jobs and $400 million in annual state revenue.

The report looked at demand for casino gaming and tax revenues generated by casinos and created projections based on that analysis. Massachusetts is facing an existing $1.3 billion budget deficit, cities and towns are saying they don't have enough money for basic services and job creation is the focus of everyone from government leaders to chamber of commerce officials.

Casino gambling could address some of those problems, but critics argue it could create more of its own.

Thus far the proposed online gambling ban with punitive sanctions tucked away in a section of Patrick's proposal does not appear to have become a major issue.

Come March 18, the decision will probably be made. The Joint Committee on Economic Development has scheduled a hearing on Patrick's proposal, and Speaker DiMasi said this past week he plans an up-or-down vote before the House completes budget deliberations in April.

That may explain the escalating intensity and devolving rhetoric among state politicos.

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ACADEMICS TAKE A STAND ON MASS. ONLINE GAMBLING PROPOSAL

Harvard law professor plans a rally this week

The Global Poker Strategic Thinking Society (GPSTS), the group formed at Harvard Law School to promote poker as an educational tool (see previous InfoPowa report), is co-sponsoring a rally Tuesday at the Statehouse in Boston with the Massachusetts chapter of the Poker Players Alliance to protest the proposed criminalisation of online poker in Governor Deval Patrick's gaming bill.

The group plans to demand that Governor Patrick explain who wrote the provision of the casino bill outlawing poker, which a Harvard Law Professor called "crazy and nonsensical."

"I don't think filling our expensive jail cells with poker players is what Massachusetts voters had in mind when they elected Deval Patrick," said Charles Nesson, the Harvard professor who founded the GPSTS.

Governor Patrick "owes the people of Massachusetts an explanation" as to how the anti-poker provision found its way into the bill, Nesson said. "We intend to keep pushing this until we get answers from the governor," Nesson added.

A public hearing on the highly controversial legislation, the Massachusetts Casino Expansion bill (H. 4307), which seeks to ban online gambling at the same time allowing the construction and operation of three massive land casinos, is scheduled for Tuesday after the 9:15 a.m. rally in front of the Statehouse.

Nesson plans to speak at the rally. If the bill passes, residents of Massachusetts who play online poker would face jail terms of up to two years and a maximum fine of $25 000. Massachusetts would be the only state in the country to explicitly make the playing of online poker a crime, and the law would even apply to players in online poker games where no money was at stake.

"There is another downside to the anti-poker legislation. Outlawing online poker also advertises to the world that Massachusetts is a state that discriminates against the Internet and new technologies, which is exactly the opposite of what the state needs for its economic development," Nesson added.

John Pappas, the executive director of the Poker Players Alliance, said that Massachusetts had become a bellwether state in terms of its policy toward online gaming. "People around the world are watching to see how the Massachusetts legislature deals with this issue because its significance goes far beyond gaming," said Pappas, whose organisation has over 900 000 members.

"We believe taking the extreme step of criminalizing online poker would be a strike against personal freedom, would tarnish the reputation of Massachusetts as a progressive state, and be opposed by millions of poker players around the country and world," he added.

Nesson has had a series of sharp written and verbal exchanges with casino owners and government officials trying to determine the author of the anti- poker provision. Nesson said a spokesman for Governor Patrick informed him that the governor was unaware of the provision, while inquiries to the Governor's press secretary have gone unanswered.

Said Nesson, "On top of the issue of creating bad law there is a good government question concerning how legislation actually gets written in this state. It should be a matter of concern to all Massachusetts citizens, regardless of their views about online games, how this narrow industry-backed provision found its way into the Governor's casino bill."

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MASS. ONLINE GAMBLING BAN SLAMMED AT RALLY

Harvard Law Professor Charles Nesson and iMEGA representatives criticise online gambling ban clause in Governor's proposal

The Harvard university group Global Poker Strategic Thinking Society, the Poker Players Alliance and the iMEGA Internet freedom pressure group between them marshalled a protest rally this week outside the Massachusetts legislature's offices where a debate on allowing land casinos in Massachusetts as proposed by Governor Deval Patrick was taking place.

But it wasn't the land casinos that motivated the protest. Instead it was a clause tucked away in the proposal that would make online gambling in the state a banned pastime on pain of draconian penalties that was the focus for the rally....and no one was 'fessing up to its drafting.

Harvard Law Professor and founder of the Global Poker Strategic Thinking Society (GPSTS) Charles Nesson criticised the proposed casino bill for making it a crime for individuals to play poker on the Internet when he addressed the crowd in front of the Massachusetts State House. He had earlier submitted written testimony prepared for the Legislature's public hearing.

Nesson said, "Governor Patrick's Casino bill would make it illegal for state residents to play poker online, with penalties ranging from hefty fines to jail time of up to two years. How crazy is that? Who wrote the bill's strange provision to criminalize online games? The Governor's people say it wasn't him (even though it's nominally his bill). The Las Vegas casino interests say it's not them. Both questions should be put to the Governor..."

Nesson has been in contact with the Massachusetts Governor's office about the drafting as well as the chairman of the board of the Las Vegas Sands Corp, which is thought to have a hand in the creation of the bill, trying to get answers on who inserted the provision making it illegal to play online poker.

"I don't think filling our expensive jail cells with poker players is what Massachusetts voters had in mind when they elected Deval Patrick," Nesson said in a press release.

At the hearing Joe Brennan Jr., Interactive Media Entertainment & Gaming Association chairman, expressed his organisation's opposition to the anti- Internet gambling provision in the bill. "It is ironic for a bill to legalize gambling in Massachusetts to outlaw and severely punish gambling online. It simply makes no sense," Brennan said.

"How can an activity that is legal in 48 of the 50 states be a criminal act simply because it utilizes the Internet? If an American has the right to choose in the "real world," shouldn't they enjoy that very same right when they are online?"

"Like many of the government's forays into cyberspace, these efforts are well intended but yield the considerable practical problems of unintended consequences," Brennan said. "In this case, Americans' right to privacy and freedom of expression are imperiled by overzealous lawmaking."


GOVERNOR PATRICK ADMITS CASINO BILL DEFEAT LIKELY

Blames "House leadership" for negativity regarding possible Massachusetts land casinos

Gov. Deval Patrick conceded after hearings in Boston this week that his plan to build three resort-style casinos in Massachusetts is heading for likely defeat in the Legislature, blaming "undue pressure from House leadership."

But Patrick, in his second year as governor, indicated he isn't giving up on the idea, saying he's still looking for ways to make the bill stronger.

"I have no illusions about the plans in the House for this legislation," he said Tuesday at a packed legislative hearing. "I'm simply asking that an open debate begin, rather than end, today."

The hearing could determine the fate of Patrick's bill for the current legislative session. Patrick says casinos would generate new jobs and revenue. Critics warn the proposal exaggerates the economic benefits and would bring increased crime and even worsen the foreclosure crisis if gambling addicts spend their mortgage payments on slot machines.

If the committee releases the bill with a recommendation that lawmakers reject it, it could come up for a vote as early as Thursday. House Speaker Salvatore DiMasi has pressed lawmakers to kill the bill, saying casinos would "absolutely cause human damage on a grand scale."

Patrick has said the casinos would create tens of thousands of construction jobs and 20 000 full-time permanent jobs and bring in $200 million in fees per license plus an estimated $400 million a year in new revenues.

"Casinos in Massachusetts will be neither a cure-all for all of our fiscal needs nor an end of civilization as we know it," he said to an overflowing crowd of mostly casino supporters in Gardner Auditorium.

Earlier in the day, DiMasi told a Greater Boston Chamber of Commerce breakfast he could not support the governor's plan because it would ultimately harm residents. "We will absolutely and no question have increased bankruptcies, foreclosures, divorce, broken families, increased property crimes, domestic violence and on and on and on," DiMasi said. "The cost of cleaning up the human devastation brought by casino gambling is too great."

DiMasi said he has seen strong public opposition to Patrick's plan, but those voices have not been heard as prominently as advocates.

"After six months of debate on this bill, I believe the evidence is not there, the case has not been made and time is running out," DiMasi said. "Right now, my answer is no."

A long list of supporters and opponents signed up with the state's Joint Committee on Economic Development to testify during the public hearing, which began at 10 a.m. and stretched into the afternoon. They included clergy members, environmentalists, online poker players and dozens of union backers.

Committee co-chairman Rep. Daniel Bosley, one of the fiercest critics of casino gambling, warned that allowing three casinos could open up a Pandora's Box of trouble. He pointed to the state Lottery - which began with a single daily number and grew into dozens of scratch tickets, Megabucks, Mega Millions and Keno - and said the state could quickly become just as addicted to casino money.

"The Lottery should be a cautionary tale," said the North Adams Democrat. "We love the revenues, but we hate how we get them."

Rep. Sarah Peake, D-Provincetown warned that the pull of the casinos could end up hurting some of the state's traditional tourist attractions, particularly in her Cape Cod district. "It will be good for tourism around the resort casinos, but it will be bad for other parts of the state," said Peake, who also owns a bed and breakfast.

Before the hearing, hundreds of casino supporters rallied on the Boston Common to urge lawmakers to support Patrick's plan. Many of the union members at the rally wore hard hats and carried signs saying "Casinos equal 20,000 jobs for Massachusetts and I need one of them."

Robert Haynes, Massachusetts president of the AFL-CIO union, urged his members to attend the hearing and push their state lawmakers to back Patrick's proposal. "I want to know which legislator is going to deny you a job, who's going to pay your mortgage when you can't pay, who's going to leave 20,000 workers in an unemployment line," Haynes said.

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MASS.STEALTH BAN HEADS FOR THE HOUSE (Update)

Economic Development committee votes against land casino proposal

In a 10 vs. 8 vote this week a key legislative committee in the Massachusetts legislature voted to recommend that lawmakers reject Gov. Deval Patrick's proposal to build three resort-style casinos in Massachusetts, all but dooming the bill this session. The proposal contains a 'stealth' clause seeking to ban online gambling in the state, seen by many as a protectionist move to sweeten the deal for land operators.

Observers say that vote has set the stage for a predictable outcome, and that a subsequent debate and vote in the state's House of Representatives will be a formality.

The Joint Committee on Economic Development rejection, which came after a four-hour delay and arm-twisting by House Speaker Salvatore DiMasi, sets up a vote in the House of Representatives almost immediately. If the bill is defeated then, it cannot be brought back until next year. One committee member abstained from voting and another member proved pivotal to the outcome.

Rep. Richard Ross told The Associated Press he dropped his support for the bill after the owners of the Plainridge horse trotting track in his district said they would rather take a shot at the House passing a bill to install slot machines at the state's four racetracks than seek to amend Patrick's proposal to allow those machines as well as the casinos.

"I got a loud and clear message from my district ... that they really wanted me to vote for the adverse report," Ross said. "Really, until the eleventh hour, 59th minute, I was on the phone."

Patrick's bill proposed licensing three casinos spread across Massachusetts. It called for a licensing fee of at least $200 million each, and he projected it would generate $400 million in annual revenues and thousands of permanent jobs.

The committee vote followed a marathon public hearing Tuesday, where members of the committee heard from opponents and supporters, including Patrick, who all but conceded the bill was heading for likely defeat.

Patrick blamed the expected defeat in part on pressure from House leaders, including DiMasi.

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MASS. HOUSE REJECTS CASINO PLAN (Update)

Six hour debate culminates in a defeat (for now) for the Governor

Already burdened with a 'not recommended' tag from the Massachusetts legislature's Joint Committee on Economic Development, a bill proposing the introduction of three resort-style land casinos in the state was effectively rejected in a House of Representatives vote this week. The proposal, put forward by Governor Deval Patrick, included a clause seeking to ban Internet gambling.

After an impassioned six-hour debate, representatives voted 106-48 to send the bill to a study committee, effectively defeating the measure and ensuring it won't come back up for debate until next year at the earliest, reports Associated Press.

House Speaker Sal DiMasi engineered a pivotal committee vote against the bill. After the vote, he said "big money special interests lost," while the people of Massachusetts won.

Patrick predicted the casinos would have generated $400 million in annual tax revenue.

Robert Haynes, Massachusetts president of the AFL-CIO and a supporter of the bill, says he's profoundly disappointed in the vote and in the process.

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THE BAY STATE LIKES TO GAMBLE

State lost out on $233 million in tax last year

The recent furore in the Massachusetts state legislature over Governor Deval Patrick's rejected proposal to launch three land resort casinos and ban online gambling has focused attention on the state and its gambling proclivities, with a recent study indicating that neighbouring states are reaping big rewards from Massachusetts players.

A new study has found Massachusetts residents spent $1.1 billion at Connecticut casinos and Rhode Island slot parlours last year, generating more than $233 million in tax revenues for those states.

Researchers at the University of Massachusetts-Dartmouth found that Bay State citizens spent $846 million at Foxwoods and Mohegan Sun in Connecticut, and $195 million at Twin River and Newport Grand in Rhode Island in 2007.

The fifth annual study by professor Clyde Barrow says Massachusetts residents made more than eight million visits to gambling facilities in other New England states in 2007.