Tuesday, July 12, 2011

Foreign investors seek to exploit Massachusetts gambling carve outs for tax exempt Indian gaming

Casino Scam Report today details Genting Malaysia, the financial backers of the Wampanoag Tribe scheme to get tax-exempt gaming operations in Massachusetts, goals in the United States reporting, "This company is seriously betting on more liberal gambling laws from the US" to create an apparent network of new "mini Macau" gambling operations here.

Is this really what we want for Massachusetts?  For the communities of Raynham, New Bedford, Middleborough or Mashpee to have Wampanoag "reservation" gambling complexes within their communities becoming islands of casinos, hotels, restaurants and shops free from state and local jurisdictions and controls?  Does it make sense for anywhere on the South Shore, Cape or Islands to have valuable and currently taxed lands set aside into trust and exempt from all state and local taxes so foreign investors can suck hundreds of millions of dollars out of our economy into overseas bank accounts?  

If we are so desperate for short term construction jobs followed by minimum wage cocktail waitress and black jack dealer employment shouldn't we also seek some guarantees for local zoning controls, local law enforcement and protections for existing businesses from unfair tax-exempt competition?   As the recent Supreme Court case involving Indian gaming in California spelled out, once established, Indian gaming operations become outside the scope and reach of any local authorities.  No taxes, no zoning, no local police, no licensing fees, nada!

Despite the “Ca-ching” statements by Senator Therese Murray, Governor Deval Patrick and State Economic Development Director Greg Bialecki – the only people who will be cashing any big checks if the Wampanoag scheme for a tribal preference carve out is allowed will be foreign investors.  As Time Magazine reported on the investors behind the Wampanoag and other Indian gaming operations:

The big winners are non-Indian investors, some of whom pocket more than 40% of an Indian casino's profits. Actually, calling these people investors understates their role. They often serve as master strategists who draw up the plans and then underwrite the total cost of bringing a casino online: ferreting out an amenable tribe, paying a signing bonus, picking up tribal expenses and paying the salaries of the tribe's officials, all of this before a spade of dirt is turned. If an Indian band isn't federally recognized as a tribe and is thus ineligible for a gaming venture (like the Wampanoag), these full-service backers will bankroll genealogists to construct a family tree, then hire lawyers and lobbyists in Washington to help change the band's status. And if a reservation isn't prime real estate for a casino, the investors sometimes purchase a more suitable patch and instruct their lawyers and lobbyists to persuade the government to designate the land as a trust, as reservation property is called. ..”

While padding his campaign war chest with Wampanoag and lobbyist money provided by the Malaysian gaming syndicate Genting, the Governor and his team, led by Greg Bialecki, continually state they want casino gaming that equals that offered in by Connecticut.  Really?  Each year the Foxwoods and Mohegan Sun foreign investors pull hundreds of millions in profits out of the state while the tribe is now more than $2 billion in debt and local communities neighboring the casinos are struggling to keep up with new expenses associated with having tax-exempt gambling operations nearby.  Massachusetts can and should do better.

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