Gaming Commission, urged on by Patrick, grants 7-day reprieve on host community decisions
Massachusetts Gaming Commission members Stephen Crosby ( center), James McHugh (left) and Gayle Cameron (right) answer questions
after hearing.
Boston Mayor Marty Walsh, enlisting the help of the governor, convinced the Massachusetts Gaming Commission on Thursday to give him another week to negotiate the best deal he can for the city with the companies seeking the license to build a casino in Greater Boston.
The last-minute reprieve was granted on a 5-0 vote of the commission, but it was unclear whether the delay was given under false pretenses. In asking for the delay, Gov. Deval Patrick led gaming commission chairman Stephen Crosby to believe that Boston was negotiating with both Mohegan Sun/Brigade Capital and Wynn Enterprises, but it turns out the city had only been talking with Mohegan Sun/Brigade, which is represented by Doug Rubin, the governor’s former chief of staff. Rubin could not be reached for comment.
Heather Nichols, the governor’s press secretary, said Walsh was the one who had led Patrick to believe he was negotiating with all parties. “The mayor had conveyed to the governor he was in active negotiations with both developers,” Nichols said in an email. “The governor didn’t try to persuade the chairman or lead the chairman to believe that was the case — those were the facts as the governor understood them to be.”
The Massachusetts Gaming Commission was scheduled to decide on Thursday whether Boston should be designated a host community to the two proposed casinos, in Everett and Revere. If granted, host community status would mean Charlestown residents would have to vote to approve the proposed Wynn casino in Everett and East Boston residents would have to back the proposed Mohegan Sun/Brigade casino in Revere.
Boston was given a month to prepare for the Thursday hearing, but ended up essentially boycotting the process. The city complained that Crosby was biased and questioned the commission’s authority to make a decision on host community status.
Walsh’s endgame in the lead up to the hearing was hard to figure. He voted for casino gambling while serving in the Legislature, but pushing for host community status for Boston was seen as an attempt to derail the proposed casinos because of opposition to them in Charlestown and East Boston. East Boston voted 4,281-3,353 against a casino at Suffolk Downs in November. It was that vote that prompted Suffolk Downs to drop its casino bid and bring in Mohegan Sun and Brigade to run a casino on a Revere portion of the track’s property.
Crosby surprised nearly everyone at the Thursday hearing by announcing at the outset that Boston had requested at 4 p.m. on Wednesday a delay of at least a week to study new information. Then he disclosed that Patrick had called him at approximately 6 p.m. – the governor’s first contact with Crosby since Patrick selected him for the chairman’s job – to urge him to go along with Boston’s requested delay. Crosby quoted the governor as saying: “The parties are close enough that it is worth giving the process another week.”
Crosby said after the meeting that he assumed the governor was suggesting that Boston was negotiating with both Mohegan Sun/Brigade Capital and Wynn, but during the hearing Wynn’s local attorney Samuel (Tony) Starr came forward and said the city’s request was a complete surprise to him. “We have had no such conversations with the city,” he said. Some Wynn officials said they had had no contact with the city in 10 days.
The nature of the deal being negotiated between Walsh and Mohegan Sun/Brigade Capital is unclear. There is some speculation that Mohegan Sun/Brigade Capital may be preparing to offer Boston a lot of money to accept the designation as a surrounding community, one entitled to mitigation payments but not an up-or-down vote on the casino. With a deal with Mohegan Sun/Brigade in hand, Walsh could then try to extract similar terms from Wynn.
Others say Mohegan Sun/Brigade may be working out a deal to grant Boston host community status for its casino. Such a deal would give Boston a hefty stream of income from the casino and the ability to extract numerous other infrastructure concessions. The trick for Mohegan Sun/Brigade would be to win approval from East Boston residents for the casino. East Boston voted down the earlier casino plan in November when the turnout was 46 percent; a vote on the new casino proposal in the middle of this summer when turnout would probably be much lower could yield a different outcome.
State law defines a host community as a “municipality in which a gaming establishment is located” and defines a gaming establishment as “a gaming area and any other nongaming structure related to the gaming area and may include, but shall not be limited to, hotels, restaurants, or other amenities.”
Matt Cameron, a lawyer representing the group No Eastie Casino, said at Thursday’s hearing that the Suffolk Downs racetrack, which straddles East Boston and Revere, is clearly an amenity to the proposed Mohegan Sun/Brigade casino. In fact, he noted, the casino has been designed so that casino patrons could look out on the track as they make wagers.
Steve Wynn, in an earlier interview with CommonWealth, said repeatedly that Mohegan Sun is determined to win approval for a casino in Massachusetts to protect its business at its casino in Connecticut. Mohegan Sun officials deny that charge.
Both Crosby and James McHugh, another member of the gaming commission, stressed that the governor’s call to Crosby was focused on the process and not the substance of the agency’s host community decision. But Wynn officials said privately that the process in this case benefited only Mohegan Sun/Brigade.
In voting for the delay, the commissioners all said a one-week delay would make little difference and a negotiated agreement was preferable to one imposed on the parties. “Deadlines are important, but deadlines aren’t absolute,” said McHugh, a former judge.
Clearly, Wynn’s representatives felt blindsided at the hearing. Starr, the Wynn attorney, asked the commission for clarification on whether the delay meant there would be any other changes in the process. He noted the commission had said no one could testify at the Thursday hearing unless they had met deadlines for filing briefs with the commission. Crosby said Boston had been offered the opportunity to speak at Thursday’s hearing, but Starr indicated that under the guidelines laid out by the commission that wasn’t allowed.
“We certainly hear your point,” McHugh said.
There was also discussion at the hearing of the lease agreement between Suffolk Downs and Mohegan Sun/Brigade Capital. The lease contains a revenue sharing initiative, meaning the higher the revenue of the casino the higher the lease payments by the casino to Suffolk Downs. No Eastie Casino has said the agreement suggests a financial partnership between the casino operator and the track, but others say the agreement is standard boilerplate.
The commission has refused to release the lease agreement, but on Thursday commissioners indicated they would probably release a redacted copy of the document.
“It’s not a lease. It’s a lot of things,” Crosby said of the agreement. But an attorney representing Mohegan Sun said the agreement “is the equivalent of a lease.”