Connecticut Reach Sports Wagering & Online Gaming Deal With Mohegan Tribe

• The deal is a first allowing non-tribal gambling operator to participate online in the state
• The announcement drew an immediate question from Mashantucket Pequot Tribe & Sportech 
• The expectation is optimistic updated agreement can be accomplished to begin operation

The state of Connecticut crossed a major hurdle that will soon allow mobile wagering within the state but comes with a few roadblocks before anyone officially can make a bet online.

Gov. Ned Lamont and the Mohegan Tribe agreed on Tuesday to establish online gambling and sports betting in Connecticut that allows for the first-time nontribal gambling operators to compete for bettors. The deal with the Mohegan Tribe, owner of the Mohegan Sun Resort in Uncasville also includes new gaming options for the Connecticut Lottery Corp.

Upon the announcement, the agreement immediately came under fire from competitors, the Mashantucket Pequot Tribal Nation, and Connecticut’s state’s pari-mutuel operator.

The Mashantucket Pequot Nation, which operates the nationally known Foxwoods Resort Casino, made it known they are not a party to the agreement. Their chairman said the announcement failed to mention the tribe was “extremely disrespectful in terms of process and substance.”

Also dissatisfied was Sportech, Connecticut’s pari-mutuel operator, who would be sublicensed by the Connecticut Lottery Corp. Under the agreement, they would operate several retail sports betting sites. They responded, “they will sue because the agreement principally excludes it from expanded gaming”.

Gov. Lamont commented in a news release about the pact:

This agreement represents months of hard work and dedication to getting a deal that’s best for the residents of Connecticut and moves our state forward when it comes to the future of gaming. We are incredibly fortunate to have such a devoted partner in these efforts like the Mohegan Tribe, as they have been open to negotiation, honest discussion, and a positive path forward that is beneficial for both their tribe and the State of Connecticut.

Major Components of the Deal

Connecticut will institute a 20% tax rate on new online gaming or “iGaming” offerings and a 13.75% tax on sports wagering.

• The Connecticut Lottery will be allowed to operate 15 retail sports betting locations and operate (1) online sports betting skin.
• The Connecticut Lottery will have the right to sub-license a portion of those retail sports betting locations to the state-licensed pari-mutuel operator.
• The Connecticut Lottery will begin new retail sports betting venues in Hartford and Bridgeport.

The agreement is for 10 years with a five-year extension option. No specific timeline to launch online gaming operations was announced on Tuesday.

Ongoing Negotiations Will Continue

It is obvious and apparent no operations will begin without a settlement with the Mashantucket Pequot Tribe.  Last December, DraftKings Sportsbook entered into a separate partnership agreement with the tribe to secure their online sports betting process.

Mashantucket Chairman Rodney Butler said during the public hearing heard virtually:

It literally comes down to a question of fairness and equity. In the context of the deal, the point is insignificant. It’s a revenue question. It’s a revenue question, which is less than a rounding error for the state, but to my nation it means sustainability. Just permitting Lottery to participate in full sports betting, absent tax, or revenue share, is a major allowance. I can assure you we’re in solidarity with our Mohegan cousins on this. We are so close. We are down to one final point and when we get there this is going to be a great deal for everyone.

Like other US regions, a major incentive for Connecticut involves a geographical push. New England states New Hampshire, and Rhode Island has made sports wagering legal with Massachusetts achieving steady progress. New York Gov. Andrew Cuomo has also changed his position, allowing his state going forward to pursue online sports wagering later this year.

The number one goal is financial  Less than a month ago, Lamont expressed optimism about releasing his two-year budget indicating he expects $50 million in revenue from online sports wagering, iGaming, and iLottery.