Mohegan Sun signs 'surrounding community' agreement with Boston

An artist's rendering of the proposed Mohegan Sun Massachusetts casino in Revere, Mass.
An artist's rendering of the proposed Mohegan Sun Massachusetts casino in Revere, Mass. Courtesy of O'Neill and Associates

Mohegan Sun Massachusetts, the $1.3 billion resort casino proposed for Revere, Mass., would soften its impact on Boston, particularly the city’s East Boston neighborhood, by paying the city more than $300 million over a 15-year period.

The payments are part of a “surrounding community agreement” signed by the parties Thursday in Boston.

The $300 million includes payments of at least $18 million a year and $30 million over 10 years for capital projects in East Boston. The annual payments could grow over time to $22.5 million or more. The city would also benefit from Mohegan Sun’s $45 million plan to mitigate the casino’s impact on transportation in Revere and East Boston.

“We are very happy to say today that we have a deal with the City of Boston,” Kevin Brown, the Mohegan chairman, said. “The Mohegan Tribe has a long history of being good neighbors in New England. And the approach we have taken to this agreement — and all of our surrounding community agreements — is reflective of that history.”

The deal is considered a major step in Mohegan Sun’s bid to win the coveted Greater Boston casino license the Massachusetts Gaming Commission is expected to award this summer. Mohegan Sun is vying for the license with Wynn Resorts, the Las Vegas-based gaming giant proposing a $1.6 billion project in Everett, another small city contiguous to Boston.

Negotiations between Wynn and the City of Boston have entered arbitration.

“This is a really rewarding day,” Mitchell Etess, the Mohegan Tribal Gaming Authority’s chief executive officer, said in a phone interview after the agreement was signed. “Our goal throughout this process has been to look at the legislation (authorizing Massachusetts casinos) and achieve every single thing they’re looking for. And a key part of that has been reaching agreements with communities. In every case, we’ve done it without arbitration. Looking at it logically, I would hope the commission would weigh that in our favor.”

The Boston accord was the last of 12 surrounding community agreements Mohegan Sun needed to sign. In recent months, it signed agreements with Cambridge, Chelsea, Everett, Lynn, Malden, Medford, Melrose, Salem, Saugus, Somerville and Winthrop.

Mohegan Sun has also signed a “host community agreement” with Revere that calls for annual payments starting at $25 million. The 13 agreements call for annual payments totaling more than $55 million.

Mohegan Sun Massachusetts expects to take in $857 million in revenue in its first year of operation.

Boston Mayor Martin Walsh had sought host community status for his city, a designation that would have subjected Mohegan Sun’s Revere project to a referendum vote in East Boston. The gaming commission rejected Walsh’s claim, citing the casino’s proposed location within the confines of the city of Revere on land owned by the Suffolk Downs thoroughbred track.

A Suffolk Downs casino that would have straddled the East Boston-Revere line stalled last year when voters in East Boston rejected it even though, at the same time, Revere voters endorsed it. Subsequently, Mohegan Sun partnered with Suffolk Downs on a redesigned project that would be located entirely in Revere.

“This was a difficult decision, but I have a responsibility as the mayor of Boston to protect the best interests of our city, and of those in the neighborhood most impacted by this proposal,” Walsh said in a statement announcing the agreement. “Mohegan Sun has engaged fully with our team and with this city, with a clear intent to be a good neighbor to our community. I appreciate their willingness to come to the table and work together on a deal that supports and strengthens Boston’s infrastructure and economy.”

The mayor also announced an agreement on taxes with Suffolk Downs, whose owners have pledged to keep the track running if Mohegan Sun wins the license to operate the Revere casino.

“If there is an attempt to introduce a gaming- or casino-related facility in any part of property located in East Boston, Mohegan agrees to address Boston as a host community as they engage in the plans,” Walsh said. “This will immediately trigger a vote for community members, and a discussion of new, revised mitigation as a host community.”

Etess said Mohegan Sun’s negotiations with Boston posed challenges.

“Let there be no doubt that Boston is a very big ‘surrounding community,’” he said. “They had issues far and above what other communities had, and we wanted to address as many of their concerns as possible. All of the capital dollars go to things in East Boston, including (funding for) an addiction center. We’re going to be working with East Boston.”

A referendum question asking whether the law authorizing Massachusetts casinos should be repealed will appear on Election Day ballots in the state this November.

b.hallenbeck@theday.com

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