Compromise Keeps Casino Proposal at Revere’s Suffolk Downs Site Alive

While many were expecting a finite decision by the Massachusetts Gaming Commission (MGC) on Tuesday afternoon considering the Revere-only casino, the Commissioners instead surprised everyone by agreeing to a very detailed compromise that will allow the proposal to go forward with a caveat.

The caveat being that Revere must take another vote for the new Mohegan Sun proposal, and that the Commission would give the new proposal a waiver for its Dec. 31 application deadline – a waiver that would only allow them to turn in the results of the vote after the deadline.

Commissioner Jim McHugh came up with the compromise and, at the outset, explained that he would rather have the voters decide the issue rather than the Commissioners, as he believes the new proposal is very different than the previous proposal and needs another public weighing.

“The dichotomy here is letting the voters decide or letting us decide whether this proposal moves forward,” he said.

The McHugh Compromise – which was agreed to in a ‘yay’ or ‘nay’ vote rather than a roll call vote after about one hour of discussion – allows Mohegan Sun/Suffolk Downs to make the decision about what it wants to do. If it wants to continue on the current course, the matter will come back to the MGC for an ultimate vote as was expected Tuesday.

If the applicant chooses the McHugh Compromise, then a second Revere-only vote would be scheduled for 60 days later – approximately.

Meanwhile, Mohegan Sun – who is the new applicant, with Suffolk Downs being the landlord – would have to proceed with the regular Phase 2 application, without the vote results. They would be required to turn in the application – likely accompanied by a new or amended Host Community Agreement – by Dec. 31. The Commission would begin evaluating the Phase 2 application in January while Revere would prepare for a mid-February referendum vote of the new project. That referendum would likely also contain the details of a new or amended host community agreement.

“If the vote is successful at that time, nothing would change and we would continue on with the evaluation of the applicant,” said McHugh. “If it wasn’t successful, the evaluation would stop and we would be evaluating only one proposal. A successful vote would allow us to proceed with two applicants, stay on schedule and have a license decision made in mid- to late-May.”

McHugh said he believed that his compromise was allowed because it was only making an exception to the regulations and not the law – and also because it was fair.

“We’re making a particular exception to one regulation,” McHugh said, citing the exact regulation (205 CMR 119.01). “We have no power to change the statute. We’re changing our regulations, which we do have the power to change…We are giving them a waiver for one aspect, for certification of a vote for a Revere-only casino…It is fair to everybody – not happy for everybody – but it does seem to be fair to everybody and, ultimately, lets the voters go to the polls and do what the statute provisions.”

MGC Attorney Catherine Blue said she believed that it was proper.

“I think this compares with the way we’ve analyzed similar situations in the past,” she said. “We are being consistent. We are valuing competition.”

Competition was a key point of the McHugh Compromise, in the end. Many of the Commissioners cited the fact that they preferred to continue on with multiple proposals, and perhaps that’s what swayed them to allow the proposal to move forward.

That was stated by Chair Steve Crosby, who listed competition as the number one priority in a list of three reasons why he prefers the McHugh Compromise.

“I think this is a very consistent idea; it’s good,” he said. “In a deeply complex situation, this is about as fair a proposal as a person could have come up with.”

Added Commissioner Gayle Cameron, “We value the competition. We did have one positive vote here and I think this proposal makes sense moving forward.”

Crosby did wonder aloud if the other applicant, Steve Wynn, might cry foul due to the waiver – as he had his successful vote last June and is seemingly ready to submit his full Phase 2 application on time if allowed by the MGC.

“I just want to think about who will feel their ox is being gored,” he said.

Commissioner Enrique Zuniga said he didn’t feel that Wynn had an argument because they entered into the process knowing there would be competition, and Mohegan Sun isn’t exactly a new face on the scene – having gone through the process from the beginning in order to try to open a casino in Palmer.

“Mohegan Sun complied with the deadline of January 15,” he said. “We never made the deadline site specific. It’s not as if someone is parachuting into the middle of this so that some other applicant would say it isn’t fair.”

After approving the McHugh Compromise unanimously, the ball now falls into the court of Suffolk Downs/Mohegan Sun.

Mitchell Etess, CEO of Mohegan Tribal Gaming Authority had the following statement after the hearing:: “We look forward to working in cooperation with our host community of Revere on the path the Commission outlined today. Mohegan Sun’s strong brand recognition combined with Suffolk Downs’ more than 75 year history truly makes this a home team project. We are grateful for the strong support of residents, business leaders and elected officials in Revere and throughout the region.  Our resort casino will create thousands of new jobs, new opportunities for small businesses and additional economic development and tourism throughout the region.”

Chip Tuttle, COO of Suffolks Down said, “On behalf of our family of employees and horsemen and women, it is gratifying that the Commission has provided this option to move forward with the City of Revere where we have enjoyed substantial support and our gaming partner and developer Mohegan Sun on its vision for a world-class destination resort on the Revere portion of our property. We look forward to the next steps.”

Meanwhile, another big hearing is scheduled for Friday involving the Wynn proposal. It’s a hearing that could end up making the competition argument moot. Wynn will appear before the Commission to discuss the particulars of the land deal in Everett – a deal that Crosby said last week “involved a possible hidden ownership and/or other difficult issues which could threaten the public trust in this process, and which make the Commission’s deliberations particularly important and sensitive.”

Crosby has recused himself from that vote due to a prior business relationship with one of the official landowners. If the MGC votes not to allow the Wynn proposal to move forward on the identified land, it could end up negating that project and leaving the Mohegan Sun/Suffolk Downs proposal all alone – pending an affirmative second vote.

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