The city of Boston has doubled down on its lawsuit against the Massachusetts Gaming Commission to try to stop Steve Wynn from building a .7 billion casino in neighboring Everett by amending the suit to add more accusations.
Mayor Walsh says he has not ruled out asking for an injunction to prevent construction.
The suit, originally filed in January, asks the judge in the case to prevent the commission from taking any future actions on the Everett casino. Revere and Somerville have filed separate lawsuits challenging the granting of the license. The Mohegan Sun, whose bid for a license in Revere lost to Wynn, and the labor union that represents workers at Suffolk Downs Racetrack, are party to the Revere lawsuit.
For its part, the commission has asked the judge to dismiss the lawsuit, calling it “verbose, repetitive, argumentative and confusing.”
According to the amendment to the lawsuit, “The commission’s award of the license was the product of a corrupt process to favor Wynn. Their conduct has irreparably tainted the gaming licensing process, and has demonstrated that they are unwilling and unable to fulfill their legal obligations to serve as independent regulators.”
Elaine Driscoll, spokesman for the commission, described the lawsuit as a “personal assault” on the panel, adding, “The commission made each license award based solely on a thoughtful, objective and exhaustive evaluation of each gaming proposal.”
The suit alleges wrongdoing by the commission and Wynn Resorts during the licensing process and claims that the five-member panel changed the rules to make it easier for Wynn. It also claims that Wynn’s company had knowledge of the fact that known crime figures, including convicted felon Charles Lightbody, were part owners of the land that Wynn had optioned for the casino resort. Several of those former owners are under federal indictment for allegedly trying to hide their ties to the land deal.
Wynn officials claim that the company investigated the people who had been identified as landowners for the property, but only later found out about the secret owners after the commission raised the issue. At that time Wynn amended the sales agreement to confirm the actual owners and to lower the price to what they had originally paid for the property.
The revised lawsuit further alleges that even after the license was awarded that the commission bent the rules to allow Wynn to proceed although the company had not met conditions and deadlines. It also chose a different company to conduct a suitability investigation of Wynn after he complained about the initial choice, Spectrum Gaming the lawsuit says.
It also alleges that Chairman Crosby, who recused himself from deliberations on the license after it became known that he had a former business relationship with one of the owners of the Everett property (not the felons) actually had a much closer relationship with that owner than he disclosed and remained friends with him for twenty years after their business relationship. The suit argues that Crosby should have recused himself from the proceedings much sooner than he actually did.
The suit points out that relations between Wynn and the commission were rocky at first, but that after a personal phone call from Wynn to Crosby that the chairman allegedly did a “complete about-face.” “Chairman Crosby did Wynn’s bidding and swayed the commission,” the lawsuit states.
Everett Mayor Carlo DeMaria reacted to the additional accusations: “This is nothing but a rehashing of issues that have been brought up, solved or addressed by the state and the Gaming Commission,” he said.
The Boston mayor claims that he was forced to go to court because Wynn has not yet reached a surrounding city agreement and has failed to file for permits.
“It is clear that this is the only way to move forward to protect the rights of Boston’s public and restore integrity to the gaming process,” said the mayor’s statement.
Boston supported the casino deal proposed by the Mohegan Sun and its partner Suffolk Downs. Under its agreement with the developer the city would have received $18 million annually. Although Wynn did engage in talks with the city about a surrounding community agreement, nothing ever came of it and the two entities still have not reached an agreement. In a speech last week Mayor Walsh said that the lawsuit was not about the money but about “respect for the people of Boston.”
Despite the lawsuit Wynn is moving forward with the project and recently held a construction job fair attended by 800 potential applicants.
Southeastern Casino zone
In the southeast, now that the voters of Brockton have narrowly approved of a casino in their town, neighboring communities have begun to make the case that they should get a share of the money that could be generated by the proposed $650 million casino resort if Brockton wins the license for the Southeastern casino zone.
The casino project is proposed for the Brockton Fairgrounds. Included in the design is a seven-story hotel, 250,000 square feet of gaming, an event and conference venue, all on 45 acres.
Past surrounding community agreements have committed to pay communities near the $800 million MGM Springfield $85,000–$160,000 a year. Such agreements are designed to compensate surrounding communities for the impact the casino will have on their quality of life through mitigation.
Frank Lynam, town administrator of Whitman, explained his town’s logic to the Enterprise News: “The casino could have far-reaching effects throughout the surrounding communities.”
The town of Abington applied to be a “surrounding community” a month ago. Its officials are concerned about the possible traffic impacts from roads that will serve Brockton, as well as impacts from crime and social issues associated with gaming.
The city of West Bridgewater expects that it will be on the route to the casino from those traveling south and that it will also be tasked with providing fire and ambulance service for the casino.
Other towns that are applying or are studying applying for funds include Soughton, Easton, Randolph, Avon and East Bridgewater.
The city of Brockton will be paid at least $10 million annually as part of its host community agreement with Mass Gaming & Entertainment.
Brockton’s only competition for the license is the historic whaling community of New Bedford.
The 2011 law that authorized the three casino resorts and one slots parlor encourages communities near proposed casinos to negotiate “surrounding community agreements” with the developer and to apply for mitigation funds to compensate them for the additional public safety and infrastructure costs they are expected to incur.
Besides negotiating directly with the developer, communities are also encouraged to apply to a “Community Mitigation Fund” which is funded by money the state will collect from the casinos.
This process has only now started to begin since the first phase of the licensing process has now concluded. Some communities, such as Abington, have already applied for “surrounding community” status. The deadline to do so has not been set yet, although it is expected to be no later than this fall. The Massachusetts Gaming Commission is providing a helpful video to communities that explains the process.
A spokesman for Mass Gaming & Entertainment, Joe Baerlein, told the Enterprise News that the company has a good record of “excellent relations” with both host and surrounding communities. “At the appropriate time in the process, Mass Gaming & Entertainment will engage with those communities that meet the threshold requirements of the gaming act,” he said.
In New Bedford KG Urban has not yet signed and sealed the deal with its financial backer, Pennsylvania-based Gaming and Leisure Properties Inc. This has already prompted the gaming commission to warn KG that its patience has limits.
The commission on May 14 requested an update on the process for its May 28 meeting, although it ruled that the first phase of the application was “substantially complete.” The commission needs that information so that it can begin the rigorous background checks that are required by the law.
At that time Andrew Stern, one of the partners with KG, told commissioners that his ground was “pushing very hard” to complete the deal to fund the $650 million casino resort that is proposed for the waterfront on 43 acres that was once occupied by a power plant.
Commission Chairman Stephen Crosby told Stern, “It is time to get this going, and to meet deadlines rather than miss them. As a word to the wise, this has got to get moving pretty quickly.”
The voters of New Bedford will render a verdict on the casino at referendum on June 23. Leading up to that vote the city and developer have scheduled several public informational forums.
Always waiting in the wings of the process for a license in the area is the Mashpee Wampanoag tribe, which lawmakers had expected would get the license when they passed the 2011 gaming expansion law. When that process dragged on the commission voted to open the licensing to commercial bids.
The tribe hopes to be able to build the $500 million First Light Resort and Casino.
The tribe has been able to meet all of the qualifications for a license save one: putting the land in Taunton into trust. Its application has been before the federal government since 2007. Last week an attorney for the tribe said it expects to get an answer from the Bureau of Indian Affairs sometime in 2015. The BIA previously published the first environmental impact statement for the proposal last fall.
The attorney, the Taunton Daily Gazette quoted Arlinda Locklear: “We have good reason to believe significant portions of this document are under final review. I am pretty confident it will be this year.”
Complicating the application is the 2009 Carcieri v. Salazar ruling by the U.S. Supreme Court that said that tribes recognized after 1934 cannot put land into trust. The tribe was recognized in 2007, however it maintains that it has had a legal relationship with the federal government and before that the British crown, for centuries.
Interior Assistant Secretary Kevin Washburn, who heads the BIA commented last week to Indianz.com, “There is an ongoing legal analysis. I don’t think it is any secret that one of the things we have been working on is whether the Carcieri decision directly affects the Mashpee’s ability to put land into trust.”
Also complicating the licensing process for the Southeastern zone is the likelihood that Twin River Casino in Rhode Island will move to Tiverton, which John Taylor, chairman of Twin River Management says he wants to do.
Gayle Cameron, a member of the gaming commission, has been skeptical that the southeastern zone has enough demand to support a casino. The interest Taylor has in moving to Tiverton, just across the border, has heightened her skepticism.
Reacting to predictions that the Bay State might lose customers to casinos that beat Massachusetts to the punch in building, Cameron said recently, “First it was New Hampshire, then Connecticut, now Rhode Island. We never know what’s real and what’s not.” She says the southeastern license should be evaluated independent of what any other state does.
“When the time comes for Southeastern Massachusetts, we’ll do a market analysis to help us decide,” said the commissioner.
The Tiverton casino would be 380 feet from the border the two states share. It would have 1,000 slot machines and nearly 50 table games.
Some claim that Taylor chose the site hoping to kill plans for a southeastern casino.
In discussing the possible competition Fall River Mayor C. Samuel Sutter told the Boston Globe, “A casino on the Tiverton line would obviously hinder the success of a casino in either Somerset or New Bedford.” He added, “And it would rely mostly on Massachusetts customers with very little benefit to Massachusetts.”
Commissioner Enrique Zuniga shares that concern. Last week he told the Globe, “It’s like a game of chess. The question is, ‘How many casino operations can be supported and at what size?’ ”
For his part, Taylor claims his Tiverton casino could successfully compete against whatever southeastern Massachusetts throws at him. Especially since he envisions a small casino that will require a smaller investment than the $650 million that has been mentioned.
“A $650 million resort casino — that’s a business plan that just does not work,” Taylor told the Globe. “What will work, we think, is an appropriately sized casino.”
MGM Springfield
Work is progressing on the site work for the $800 million MGM Springfield. Four years ago on June 1, 2011 the South End of the city was devastated by a freak tornado. The casino is seen by many as the city’s way to rise up from that disaster.
MGM says it plans to open the casino in late 2017.
Nineteen buildings in the 14.5-acre footprint of the casino resort are targeted for demolition. Most of them have been vacated by their former occupants, such as the Hampden County Sheriff’s Western Massachusetts Correctional Alcohol Center, which has moved to another location.
The first actual structure to go up will be a parking garage, where once the Zanetti School, nearly destroyed by the tornado, once stood.
