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Massachusetts Officials Say MGM Casino Resulting in Increased First Responder Costs

Casino.org

July, 22, 2020

Devin O'Connor


West Springfield city officials have applied to the Massachusetts Gaming Commission (MGC) seeking additional funds to cover first responder costs that they say have increased since MGM Springfield opened in August of 2018.


MGM Resorts — the parent company to the $960 million integrated resort casino — already pays West Springfield $375,000 annually in a surrounding community mitigation arrangement. The neighboring town, however, says it needs more.


West Springfield received 11,936 emergency calls in the 12 months before MGM Springfield opened. It received 13,789 calls seeking first responder assistance in the first year after the casino began welcoming guests, an increase of 15.5 percent.


The city sits just west of Springfield across the Connecticut River. It’s home to some 28,500 people, and like Springfield, West Springfield has experienced notoriously high crime rates in recent years. According to Neighborhood Scout and City-Data, West Springfield is safer than just seven percent of all US cities.


Mitigation Funds


West Springfield’s application to the MGC is to receive funds set aside to the state gaming regulator’s Community Mitigation Fund. The Massachusetts Expanded Gaming Act, passed in 2011, established the fund to “mitigate unintended impacts associated with the arrival of casino gaming.”


“The law created the Community Mitigation Fund to support communities and governmental entities in offsetting costs related to the construction and operation of gaming facilities,” the MGC website explains.


The account is funded through gaming taxes. The state’s two Category 1 resort casinos — MGM Springfield and Encore Boston Harbor — have their gross gaming revenues (GGR) taxed at an effective rate of 25 percent. Of that money, 6.5 percent is set aside for the Community Mitigation Fund. Plainridge Park, the slots-only facility in the state, does not share any of its win with the fund.


The mitigation money can be used for transportation planning, workforce development, public safety, and government entities located in the vicinity of each of the three casinos.


Casino Prompts 911 Calls


In West Springfield’s application to receive a $200,000 Community Mitigation Fund allocation, the city says its fire department has also experienced an uptick in calls since the opening of MGM Springfield.


The West Springfield Fire Department says in the 18 months prior to the MGM casino opening, it received 10,308 calls. Of that total, 8,591 were for emergency medical services (EMS). In the 18 months after MGM Springfield opened, the fire department reported 11,033 calls, with 9,115 calls for emergency medical service (EMS).


“With more people, there are going to be more calls. We’ve seen that increase,” Mayor William Reichelt told The Republican.


MGM Springfield, along with Encore Boston Harbor and Plainridge Park, was ordered to close by the state on March 15. The casino reopened its doors Monday, July 13. The hotel remains shuttered until further notice.


Following a four-month shutdown, MGM Springfield has asked local officials to renegotiate its obligations to the city.


“It [MGM Springfield] has underperformed during regular times. Now it’s going to be even more difficult,” said Richard McGowan, associate professor in the finance department at the Carroll School of Management at Boston College.

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