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Cahill’s Slot Machine Plan Under Fire        (2 of 2)

Experts, such as casino specialist Professor Clyde Barrow of UMass-Dartmouth, say that figure is pie-in-the-sky, and totally unreasonable nowadays. Barrow said that “nobody’s ever paid” the sort of licensing fees for a slot machine parlor that Cahill described, which come to between six hundred sixty-five million and over one billion dollars apiece for the three locations. Pennsylvania, for example, sold their operating licenses for a paltry fifty million dollars each – just seven percent of Cahill’s estimate. Pennsylvania might be the best measuring stick for the prospects of slot machines in Massachusetts, considering that they were one of the most recent states to enter the market.

In reality, Barrow said, there is little rhyme or reason for determining how much exactly is paid for casino licenses – it all comes down to who is interested in bidding, and how much competition ends up coming of the process. With slot machines saturating the Northeast and Maryland having a hard time even generating enough bids for their legalized slots, Massachusetts could well have a hard time generating enough interest to guarantee sizeable licensing bids.

Cahill’s proposal for expanded legalized gambling also included provisions for the privatization of the state lottery, which the U.S. Department of Justice is calling unconstitutional. In an interview, Cahill defended his plan. He said that the slot machine numbers were “preliminary,” and countered that, even if the final numbers ended up falling short of his original estimated, “it’s still more than we’ve got right now.” He said he’d rather overestimate the worth of the slot machine licenses than underestimate them and lose out on income.

Back to March 2009 Archive.