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Connecticut Legislature and Governor Legalize iGaming

Written by Jennifer Newell
Last updated on
Jennifer Newell

Connecticut did it! Connecticut becomes the latest state – the only one in 2021 – to legalize online gaming for regulatory oversight within its borders. It joins several others:

-Nevada

-New Jersey

-Delaware

-Pennsylvania

-West Virginia

-Michigan

West Virginia has yet to accept applications for online poker sites, but that’s a story for another day.

Connecticut completed its process to legalize online casino gaming, retail and online sports wagering, fantasy contests, keno, and online lottery tickets. Everything fell into place in April when Governor Ned Lamont and the state’s two Native American tribes agreed to a new compact. It accompanied the online gaming and sports betting bills to the House for passage. In May, the House approved them, as did the Senate. And Lamont signed them on May 27, 2021.

The only problem is that it’s not final.

Normally, the governor’s signature is the final step in the process of a bill becoming a law. But when the issue involves state compacts with federally-recognized tribes, the United States Department of the Interior must approve it.

No one expects any problems, but the bill is not final until it receives that federal stamp of approval.

Years of Work and Complications

For years, Connecticut State Senator Catherine Osten introduced bills to legalize various forms of internet gaming. And the Mashantucket Pequot Tribe and Mohegan Tribe supported those efforts, as they knew well that their land-based casinos in the state would benefit.

While Governor Lamont seemed to support the idea, he also rejected it for years. There was a complicated legal battle percolating with MGM Resorts and former US Interior Secretary Ryan Zinke, a member of the Trump Administration who ultimately resigned amidst scandals and investigations.

Lamont slowly changed his tune due to two significant occurrences.

In 2018, the Department of Justice opened an investigation into Zinke and his involvement with MGM Resorts and a casino project in Connecticut. The tribes pushed back. While the DOJ intended to issue criminal charges against Zinke, US Deputy Attorney General Jeffrey Rosen stopped it in late 2019. This also kept the Inspector General’s report private. Regardless, Zinke resigned – after Trump seemed to fire him on Twitter – in December 2019.

The second factor for Lamont was the dire economic strain of the 2020-2021 coronavirus pandemic. While the state’s two tribes requested the emergency passage of igaming legislation in 2020 due to the pandemic-mandated casino closures, Lamont rejected that proposal. But this debate led to Lamont and the tribes beginning talks about revising the gaming compacts.

By March 2021, all parties supported the new agreement. It went to the Connecticut House in April with its companion bills. The bills underwent some adjustments and amendments, as well as committee approvals and fiscal analyses. The timeline then moved forward as follows:

-May 20 final House vote: 122 yea, 21 nay, 8 absent or not voting

-May 25 final Senate vote: 28 yea, 6 nay, 2 absent or not voting

-May 25 transfer of bill to Governor

-May 27 approval of Governor

-June 2 submitted to Secretary of State

Final Bill Details

Effective as of the date of passage, Public Act 21-23 authorized the licensing and regulation of “online casino gaming, retail and online sports wagering, fantasy contests, keno and online sale of lottery tickets.”

On or after July 1, 2021, the Commissioner of Consumer Protection may issue licenses to the Mashantucket Pequot Tribe and Mohegan Tribe. Each master license will permit each tribe to operate one skin for online sports wagering, one skin for online casino gaming, and then fantasy contests.

Notably, the bill does not authorize a separate license for online poker. The bill does define online casino gaming as including slots, blackjack, other table games, bingo, live dealer games, video poker, and poker. And “authorized games” includes games of chance, a category that spans bouncing ball games to poker. Whether poker will be restricted to the table-game version or open to operating as a peer-to-peer game as in other states remains to be seen.

Most analysts seem to believe that online poker is included in the bill. If so, it will pay a tax of 18% for the first five years and 20% thereafter.

Collaborative Project

Lamont issued a statement upon signing the bill. He noted that the expanded gaming options in Connecticut will be modern and technologically advanced enough to make the state’s gaming industry competitive with neighboring states. He noted special appreciation for the tribal leaders’ collaboration. “I am confident that the federal government will see fit to approve these amendments to our compact, and in the coming months we can launch a modernized, 21st century gaming experience in Connecticut.”

Mohegan Tribal Council Chairman James Gessner Jr. commented on the accomplishment with its bipartisan support. “The advantages of these changes will be felt statewide, to the benefit of Connecticut residents and our tribal members, at a time when our governments are collectively working to recover from the pandemic and provide vital services.”

Mashantucket Pequot Tribal Chairman Rodney Butler called the deal historic. He said, “Gaming is more than a business to our tribe; it is the way we fund out government, pay for our children’s education, care for our elders, and provide healthcare to our members. The agreement not only ushers in a new modern era of gaming, but it solidifies our tribal/state partnership for years to come.”

One Approval Pending

As mentioned, the Secretary of the US Department of the Interior must still approve the law per the new compacts with the Mashantucket Pequots and Mohegans. The new compact must then be published in the Federal Register in accordance with federal law, specifically the Indian Gaming Regulatory Act (IGRA).

The current Secretary of the Interior is former US Representative for the state of New Mexico Deb Haaland. She assumed her position on March 16, 2021, becoming the first Native American to serve in the position.

There is no indication that she will oppose the new compacts for Connecticut tribes.

 

 

 

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