Mashantucket Pequots Face Eroding Fortunes

Tribal gaming has helped some reach higher economic levels, but it never should have been the end all plan.  With all the money going out of state coffers, most states will approve gaming throughout the states.   Here's the story about one tribe, the Mashantucket Pequot which we had on our radar two years ago.  As usual, the New York Times is LATE to the story. Mismanagement, overpayments, lack of control or oversight on tribal leaders...sound familiar?

Encased in glass, the Mashantucket Pequot Museum and Research Center rises, improbably and on a grand scale, from the wooded swamplands of eastern Connecticut.

The museum, which cost $225 million to build and covers seven acres, is bigger than the National Museum of the American Indian in Washington. It has a massive diorama of a 17th-century Pequot village, a restaurant, an auditorium, a museum shop, libraries and archives for archaeological and documentary research and a 185-foot-tall tower with a viewing platform that looks out onto the reservation and the Foxwoods Resort and Casino less than a mile away.

When the museum opened in 1998, the outlook for the tribe was bright. The tribe reported revenues of $694 million, after payouts from the thousands of slot machines at Foxwoods that year. That figure didn’t include what it earned from table games, hotels, and concerts and other events.

In 1995, casino revenues amounted to close to $750,000 per adult tribe member; at that time there were about 315, according to “Hitting the Jackpot” a book by Brett D. Fromson. And for years afterward, adult members, who now number close to 1,000, could expect annual payments reported to be about $100,000, an amount the tribe has not refuted.

But those heady days are long gone.

The casino, which currently is $1.7 billion in debt, recently missed another payment. The annual payouts to tribal members have ceased, and some, in search of work, have moved.

New York and Massachusetts, which supply Foxwoods with a stream of customers, are preparing to open non-Indian casinos in the next few years, increasing competition in the region.

The newest sign that the tribe’s fortunes are slipping came on Sunday, when the museum, the Pequots’ message to the world that they are more than casino entrepreneurs, closed for several months, for the first time in its history.

The tribe is by no means destitute. But it is clear that as casino gambling, a staple for many Indian tribes, has steadily been legalized around the country, the Mashantucket Pequot have been left to navigate a future that looks different from its recent past.

“We’ve been on this land for thousands of years and we’ll be here,” said Rodney A. Butler, the tribal chairman. “Economic success is different from tribal success.”

The casino is in debt in part because of competition — including competition with Mohegan Sun, a casino run by the Mohegan tribe eight miles away — and in part because of mismanagement and overexpansion. Several years ago, the tribe, along with MGM Grand, spent $700 million to build a new tower at the casino, with hotel rooms and a gambling floor. MGM Grand is no longer part of the partnership, and now has a license to build its own casino in Springfield, Mass., about 75 miles away.

The tribe is trying to adjust, diversifying some of its industries by building a $120 million strip mall outside the casino and potentially selling some off-reservation properties, according to a presentation given to bondholders in 2012. The tribe has also talked of teaming with the Mohegans to open a third Connecticut casino, which some public officials support as a way to keep gambling dollars in the state.

Tribal leaders declined to give details about their plans, and, consistent with past practice, would authorize only a small number of officials and tribal members to speak about their circumstances.

Pequot officials said the museum is closing for repairs, and also so they can find an executive director and fill a position that has been vacant for several months. But 45 of the 55 employees are being laid off, at least temporarily, suggesting that closing the museum is an attempt to adapt to a new financial reality.

So was ending the annual stipends, which the tribe called “incentive payments,” in 2010.

“There was a lot of frustration, anger and fear when the payments stopped, especially if you’ve built your life with that kind of freedom,” said a member of the Pequot tribe, Dale Merrill.

Ms. Merrill was a part-time student raising three children as a single mother when the payments stopped. The end of the incentive payments, to her, signaled a loss of the opportunity to go to school and raise her children without worry. She also said that there were some positive elements: “Money can be a distraction. The kids and our youth seem to be much more focused on staying connected as a tribe and living up to what we’re supposed to be.”

Ms. Merrill, like many other tribal members, went to work for the tribal government and is now vice president of human resources and administration. Some members were able to find jobs at the casino, the museum, or in the tribal government or tribal health services.

Other changes were subtle. Mark Bancroft, assistant to the mayor of Ledyard, said that five or six houses on tribal housing property outside the reservation have been torn down, and that some who had lived on the reservation had moved to Providence, R.I., and New York City, where they had lived before.

Lifestyles have changed, too. Several Pequots spoke about having ended their habit of buying expensive cars. Read the rest of the story of the Mashantucket Pequot