New study says Maine could add up to two more casinos
A study conducted by WhiteSand Gaming, a gaming consulting firm based in Atlantic City, N.J., concludes Maine could support two additional casinos, with the strongest candidate being in southern Maine with easy access to Interstate 95 and close proximity to additional customers in New Hampshire and Massachusetts. The firm suggested the minimum investment needed for that casino to “generate desirable employment and enhance tourism for the state” would be $250 million and would be part of an “integrated dining and entertainment offering.”
The study, which was commissioned by the Maine Legislature, states a second $25 million casino could be authorized in Aroostook or Washington counties — “close to the border entry with the provinces of Quebec and New Brunswick” — without negatively impacting existing or proposed casinos in Maine if its size was limited to 250 slot machines and 10 table games.
The Lewiston Sun Journal reported that members of the Legislature’s Veterans and Legal Affairs Committee are expected to begin reviewing the study on Sept. 10, with a goal of developing policy proposals for consideration in the next legislative session.
The study recommends that the state charge a five-year license fee of $5 million for an additional southern Maine casino and $1 million for a northern Maine casino on top of application fees and an annual fee of $100 per slot machine for any new casino. The consulting firm also recommends that any additional casino licenses be awarded by a competitive bid process, with the process for northern Maine being structured to give preference to “Maine’s federally recognized Indian tribes.”
It also suggests that tax rates on slot machine and table game revenue “can be lowered modestly and still deliver net positive distributable revenue for the state” to mitigate the likely reduction of revenues for Oxford Casino and Hollywood Slots. The study recommends a tax rate of 35% on net slot machine income and 16% on net table game income applied uniformly to the Oxford and Bangor casinos and a third licensee, with an expected return of $67 million to the state, “up from $53.2 million in 2013,” and assuming a “cannibalization factor” of 20% for the Oxford Casino.
This spring lawmakers turned down six bills that would have expanded gambling in the state, including one from owners of Scarborough Downs who hoped to add slots and table games to its race track complex, and others from Maine tribes.
A previous casino market analysis commissioned by commissioned by Oxford Casino owner Churchill Downs Inc. and prepared by Clyde Barrow, director of the Center for Policy Analysis at the University of Massachusetts Dartmouth, concluded that new casinos in Maine would simply divide smaller revenues in a saturated market.
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