February 15, 2009

Tribal casino stumbles on run of bad luck

Connecticut's Mashantucket Pequot tribe, owner of the biggest U.S. casino, has been squeezed by a drastic fall in revenue, an expert says.

The tribe's revenue stream has nearly dried up and its debt load has ballooned to more than $1 billion, the Philadelphia Inquirer reported Sunday.

Foxwood's slots revenue in December dipped to $45 million, down 19 percent from a year earlier. The tribe has laid off 700 casino workers, offered buyouts to tribal government employees and named a new chief executive to run the casino.

The newspaper noted the tribe's financial woes comes as it takes on a one-third stake, and the role of operator, in the 3,000-machine Foxwoods slots parlor planned for Center City, Pa.

Their plan for growth was built on an economy that no longer exists and is not coming back, said Fred Carstensen, an economist with the Connecticut Center for Economic Analysis at the University of Connecticut.

The Inquirer reported that when the tribe opened its first casino in 1992, Foxwoods had the gaming market cornered north of Atlantic City, N.J. The casino had as many as 40,000 guests a day to play on 7,200 slot machines and 380 tables for baccarat, blackjack and roulette.

But since its heyday, the tribe has faced intense competition from Mohegan Sun, another tribal mega-casino just five miles away that opened in 1997.