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Referendum decision hangs over Massachusetts casino hearings

By Brian Hallenbeck

Publication: theday.com

Published June 24. 2014 3:57PM   Updated June 25. 2014 12:01AM

Revere, Mass. — Hours after a court ruling Tuesday put Massachusetts’ embrace of casinos in jeopardy, supporters of Mohegan Sun’s plan to build a $1.3 billion resort here dominated a public hearing that at one point grew contentious.

More than a score of city officials and residents urged the Massachusetts Gaming Commission to grant Mohegan Sun the sole casino license for the Greater Boston region, saying it would do far more than a competing project to spur economic development and resolve longstanding traffic problems.

“It’s the right project at the best site,” said Revere Mayor Dan Rizzo, whose city stands to reap $25 million to $30 million in annual “mitigation” payments if Mohegan Sun is awarded the license. The payments are outlined in a so-called “host community agreement” the city negotiated with Mohegan Sun. Revere voters endorsed the deal in a February referendum.

Speaking near the end of a four-hour hearing at Revere High School, opponents of the project derided it as “just a casino at Suffolk Downs,” a reference to the thoroughbred track that straddles the Revere-East Boston line. An earlier Suffolk Downs casino project was rejected by East Boston voters last November.

Mohegan Sun and Suffolk Downs subsequently partnered on the current project, which would be located adjacent to the track but entirely within the confines of Revere. No Eastie Casino, a grass-roots organization, maintains that East Boston voters should have had a say in whether the Mohegan Sun project could proceed.

The news earlier in the day, that the Massachusetts Supreme Judicial Court was allowing a ballot initiative aimed at repealing the Bay State’s 2011 expanding-gambling law to go forward, threatened to upstage the Revere hearing.

Before the start of the session, Mitchell Etess, the Mohegan Tribal Gaming Authority’s chief executive officer, said the timing of the court’s ruling took him by surprise.

“I wasn’t expecting it,” he said.

Etess dismissed the suggestion that repeal of the gambling law could actually be to the Connecticut casinos’ advantage.

“We’ve made it clear: We’re in this to stay,” Etess said. “We’ll be part of the campaign that fights against the referendum — and for jobs and economic prosperity for the Commonwealth.”

During the hearing, Etess sought to distinguish the Mohegan Sun Massachusetts proposal from Wynn Resorts’ plan to erect a $1.6 billion casino on the Mystic River. The Wynn proposal will be the subject of a hearing today in Everett.

Etess panned Wynn’s planned tower as a “cookie-cutter design,” a duplicate of one Wynn had previously proposed for Philadelphia and “better suited to Las Vegas.” Mohegan Sun Massachusetts, Etess said, was “specially designed” for Revere.

Etess noted that the Mohegan Sun project was crucial to the survival of Suffolk Downs and the more than 800 jobs it provides, and said the Revere project would cause Boston visitors to extend the length of their stays.

The proposed casino’s proximity to Boston attractions is “a casino marketer’s dream come true,” he said.

“We’ve got the high end,” Etess said, referring to a portion of Mohegan Sun’s clientele in Connecticut. “But focusing only on high end is a recipe for disaster.”

The Revere resort would have two hotels and nongaming amenities at “a range of price points,” he said.

Don Pardon, a representative of Brigade Capital Management, Mohegan Sun’s financial partner, addressed what he called “mischaracterizations” of Brigade as a hedge fund, saying the Mohegan Sun partners have the strongest financial profile of any of the applicants for a Massachusetts gaming license.

Kate O’Neil, a spokeswoman for the Unite Here! labor union, disputed that contention, arguing that Brigade is indeed a hedge fund and that its equity share of the project would be unprecedented in the case of a casino.

“You can expect a labor dispute at a Mohegan Sun casino,” another union member told the gaming commission.

Brian Gannon, a casino opponent, complained that members of the public, rather than elected officials, should have been allowed to speak first. He said “a culture of intimidation” had silenced many opponents, adding, “This room is stacked against us.”

Commissioner James McHugh said those who had not had a chance to speak would have an opportunity to do so at a later date.

McHugh and three other members of the commission — Gayle Cameron, Enrique Zuniga and Bruce Stebbins — are expected to act on the Greater Boston license by early September at the latest. A fifth commissioner, Chairman Stephen Crosby, has recused himself from the matter amid claims that he faces conflicts of interest.

The commission has already awarded a license for a western Massachusetts casino to MGM Resorts International, which plans to build in Springfield. It has also awarded a slots-only license for a Plainville facility, which is under construction. A third casino license eventually is to be awarded for the southeastern part of the state.

b.hallenbeck@theday.com

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