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On Election Day, Rhode Islanders will decide whether they want to allow Newport Grand and Twin River, in Lincoln, to offer table games such as roulette and blackjack in addition to their video slot machines.
The two gambling businesses say they need the table games to compete with up to three casinos expected to open in Massachusetts as early as 2017.
If voters approve the expansion, the state would get up to 18 percent of revenue from those new games. (The state already gets 61 percent from slot machines at Twin River and Newport Grand -- a projected $336 million this year.)
During an Oct. 14, 2012, appearance on WJAR’s "10 News Conference," Newport Grand Chief Executive Officer Diane Hurley said that the 18-percent cut would be a good deal for Rhode Island.
She compared it to what Connecticut gets from table games in that state’s two casinos, Mohegan Sun and Foxwoods.
"Connecticut's take on slot machines is 25 cents on the dollar. And the state's take on table games: zero," she said.
We decided to see if she was bluffing or if she had the cards.
We quickly confirmed that Hurley’s numbers were correct.
Foxwoods and Mohegan Sun, are both operated by Native American tribes.The tribes negotiated identical agreements with the state that give Connecticut 25 percent share of slot machine revenue at the casinos. That revenue is defined as the amount of money gamblers put into the machines minus the prize money paid out.
And, as Hurley correctly noted, neither Foxwoods nor Mohegan Sun pays any share of their table game revenue to the state.
Here’s how that arrangement came about.
The Mashantucket Pequots won federal recognition as a sovereign tribe in 1983. The status was significant because under federal law, any form of gambling a state allows can be conducted by a tribe, but without any state regulation.
Connecticut allowed churches and similar charitable organizations to hold bingo nights. In 1986, the tribe used that exemption to open a high-stakes bingo hall on its reservation in Ledyard, Connecticut, with none of the limits on prizes or hours that state law required.
Then, in 1992, the Pequots used a law that allowed charitable casino night events to offer table games like blackjack, roulette and poker, but also free from state regulation. Foxwoods was born.
The federal laws that made the tribe immune from state gambling laws also meant the tribe didn’t have to share its table-game revenues with the state.
But that wasn’t the case with slot machines. Because no state law allowed them under any circumstances, the tribe needed the state’s approval. The result was a 1993 agreement that let the Pequots add slot machines, and gave the state a 25 percent cut of the revenue.
In 1996 the Mohegan tribe opened its casino, Mohegan Sun, in Uncasville under the same arrangement.
Last year, according to the Connecticut gambling division, gamblers dropped $15.7 billion into the approximately 12,500 slot machines at Mohegan Sun and Foxwoods. About 92 percent of that was paid out in jackpots. The rest went to the house, with 25 percent to the state.
Hurley’s accounting of Connecticut’s cut is accurate. We rate her claim True.
TurnTo10.com, "10 News Conference, Oct. 14, 2012"
Interview, Bill Ryan, director of the gambling division of Connecticut’s Department of Consumer Protection, Oct. 22, 2012
"Tribal-State Compact between the Mohegan Tribe and the State of Connecticut," accessed Oct. 22, 2012
"Memorandum of Understanding" between the Mashantucket Pequot Tribe and the State of Connecticut, Jan. 13, 1993
Connecticut Department of Consumer Protection, Gambling Division, Foxwoods Casino, "Schedule of video/facsimile slot machine data," Jan 1, 1993-Sept. 30, 2012, accessed Oct. 22, 2012
Connecticut Department of Consumer Protection, Gambling Division, Mohegan Sun Casino, "Schedule of video/facsimile slot machine data," Oct. 1, 1996-Sept. 30, 2012, accessed Oct. 22, 2012
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