City says SugarHouse is dragging its feet

Feb. 13

Previous coverage

Read Altman Affidavit

By Kellie Patrick Gates
For PlanPhilly

In a meeting held late last week, Mayor Michael Nutter told HSP Gaming Chairman Neil Bluhm and other SugarHouse Casino representatives that they could pick up their foundation permit whenever they wanted it.

In early January, SugarHouse told the Supreme Court that the city was intentionally dragging its feet on the permit and other casino-related matters and asked the Court to order the city to issue the permit and appoint a Special Master to keep the city from stalling.

At the Feb. 6 meeting, Nutter “informed HSP’s representatives that he had alerted the Department of Licenses and Inspections (“L&I”) to stand by that afternoon, and he offered that HSP could pick up the permit immediately if it wanted,” said Deputy Mayor and Director of Commerce Andy Altman in an affidavit included with documents the City submitted to the Supreme Court this week.

But SugarHouse has still not picked up their permit.

Earlier this week, the City asked the High Court to accept its account of the Feb. 6 meeting as evidence that SugarHouse’s request for a Special Master should be denied. SugarHouse fired right back today, asking the Court not to accept the city’s proposed supplemental response to its earlier filings on the Special Master request.

“Curiously, though the permit is available for the taking, HSP refuses to accept that offer,” City attorneys wrote. “Apparently, HSP is far more interested in creating and stoking disputes, and litigating before this Court, than in actually procuring the permit that it claims the City is withholding. Remarkably, HSP has not withdrawn its request to this Court to order the City to do that which we are fully prepared to do.”

In its court papers, SugarHouse said the city is wrongly trying to condense the casino’s request for a Special Master to one issue – the foundation permit. And it calls the Feb. 6 meeting “an underhanded set up.”

Nutter, Altman and Terry Gillen, executive director of the Redevelopment Authority and the mayor’s casino point person, represented the city that day. Bluhm, HSP Chief Operating Officer Greg Carlin, investor Robert Potamkin and a public relations consultant were there from SugarHouse.

SugarHouse spokeswoman Leigh Whitaker said that SugarHouse has not picked up its permit because the city keeps giving the casino contradictory information.

In December, the City told SugarHouse that it did not have a foundation permit application from the casino, she said. Then in its response to SugarHouse’s request for a Special Master, the Citysaid SugarHouse had met the conditions and could come get the permit. In a letter dated Feb. 5 – the day before the meeting with Nutter – the City told SugarHouse the permit application was under review, asked for additional information, and said the review would be completed by March 5, when someone from the city would contact SugarHouse. “Then at the meeting, the mayor says go get it,” Whitaker said. “This is exactly why we need a special master.”

A Special Master would also help resolve the other outstanding issues, Whitaker said.

Deputy City Solicitor Andrew Ross said that SugarHouse met all the requirements for the foundation permit in September, and could have had their permit anytime after that by asking for it and paying the fee.

The City never automatically issues a permit when application requirements are met, Ross said. The City waits until the permit is requested and the fee paid, he said, because permits expire in six months. The city doesn’t want to start the clock until the applicant is ready, Ross said.

Whitaker told SugarHouse’s version of the permit story after the city filed its original response three weeks ago. She said that SugarHouse officials inquired about the foundation permit in December and were told that the city had never received their application for a foundation permit.

Ross acknowledged a December mix-up, which he said stemmed from a bit of confusion at L&I.

SugarHouse originally applied for its foundation permit in December 2007, Ross said. But folks from the city and the casino agreed that it was going to take some time for SugarHouse to meet the water department prerequisites for the foundation permit, Ross said, and so it was suggested that SugarHouse apply for a rough grading permit, so some work could begin sooner. The casino did, the permit was issued, and some work began.

Someone at L&I then mistakenly marked the foundation permit as approved. Then in December 2008 when SugarHouse inquired about their pending permit, no open foundation permit application was found, and so they were told they had not filed one.

L&I made a mistake, Ross said, but if SugarHouse had come to city officials, it could have been ironed out. Instead, he said, they went to court for the Special Master. And so the error wasn’t discovered until research was done to craft the city’s response, he said. “There was no follow up to straighten out” the misunderstanding.

Back in January, Whitaker said that in response to being told there was no permit application on file, SugarHouse produced a dated copy of its application. But SugarHouse heard nothing more about it from the city, she said, until they saw the city’s response to their request for a Special Master.

Ross said the important point isn’t whether L&I made an error, but why SugarHouse has failed to pick up a permit it has gone to court over. The city put it in writing three weeks ago in their first court filing, he said, and Nutter put it in words directly to the casino’s highest officials last week.

“They’re saying we’ve refused to issue it, but they’ve given us every indication they don’t want it,” he said.

Whitaker said in January that the permit was just one example of the delays the city had caused. The city maintained that SugarHouse’s choice of a waterfront site, which requires a permit from the Army Corps of Engineers, was largely responsible for the delay.

The City has been trying to persuade SugarHouse to consider a non-waterfront site; SugarHouse has remained determined to build on Delaware Avenue.

Contact the reporter at kelliespatrick@gmail.com

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