Casino applicants face questions on suitability this week

The five applicants for Philadelphia’s remaining casino license each face hours of questions from the Pennsylvania Gaming Control Board members and staff during this week’s suitability hearings.

The hearings are set in four-hour blocks on Tuesday, Wednesday and Thursday. See the full schedule at the end of this article.

Each applicant will begin its time slot with a presentation designed to convince the board that its proposed project is the best one for the city and the state. This go-round will differ from the February and April 2013 hearings because each applicant now knows much more about the competition. “They will be able to compare their project with the other projects,” said PGBC spokesman Doug Harbach.

But Harbach said the pick-us presentations will take up the shortest part of each applicant’s time slot – about an hour. They’ll spend the bulk of their time taking questions from gaming board members and representatives of the state gaming bureaus that have been investigating the applicants.

In addition to the reams of paperwork submitted by each applicant (see lots of it on the PGCB website, here) board members have been studying the investigative reports on each applicant’s suitability to build and operate a casino, info that was gathered by the Bureau of Investigations and Enforcement and the Bureau of Licensing. The board also has copies of the public comments provided in person at earlier hearings and in writing up through the Dec. 31, 2013 deadline, and input from Philadelphia city officials.

“This is all before the board, so they all have the opportunity to really formulate the kind of probing questions they need answered, in order for them to try and make a decision on the licensing, including which applicant they believe to be the best for the city and for the commonwealth,” Harbach said.

The board has the right to call an executive session if the questions require discussion of facts that are protected as confidential by state gaming law, Harbach said.

There will be no public testimony taken at the suitability hearings and no additional written comments will be accepted.

The board will also hear testimony from the two entities it granted a petition to intervene: Philadelphia’s existing casino, SugarHouse, and a group comprised of the Rodeph Shalom Synagogue, the Mathematics, Civics and Sciences Charter School and the Friends Select School. SugarHouse is expected to testify that the local casino market is already saturated and opening another would be counter-productive and not lead to additional revenues. The synagogue and schools group is only interested in one proposal, The Provence, and is expected to testify that it would create traffic and parking issues for them.

The applicants have already answered the “what makes your project best” questions for PlanPhilly. All of them touted their locations as best. The Casino Revolution team said they could open quickest, and then later added they’d also build a large entertainment complex. Market8 said their proposal would revitalize the East Market Street corridor. Provence’s Bart Blatstein said he’d make an unwalkable part of the city walkable and vibrant. Live! Casino & Hotel’s Joe Weinstein touted Cordish’s and Greenwood’s revenue-generating capabilities as demonstrated elsewhere and the proposal’s potential to turn 10th Street into a walkable destination. Penn National said their Hollywood Casino  brand would attract customers from elsewhere to Philadelphia and they’ll make I-76 more accessible.

Steve Wynn withdrew his proposal for the Delaware Riverfront from consideration last November. But before that, his former project manager, Dan Keating, said the competition would build regional casinos, but Wynn would build a destination resort that would attract people to stay for multiple days and likely generate more money from non-gaming activities than from gambling.

The gaming board will likely announce its decision on the license at a regularly scheduled board meeting. The first scheduled after the hearings is for February 26, but seeing the license on that agenda doesn’t necessarily mean it will happen then, Harbach said. When prior licensing decisions were made, the decision was put on several agendas, and then removed from each before meeting time.

That’s because state law requires a qualified majority. That means all four members appointed by the legislature (Gregory C. Fajt, Keith R. McCall, John J. McNally, III and Anthony C. Moscato) and at least one of the three members appointed by the governor (Chairman William H. Ryan, Jr., Annmarie Kaiser and David W. Woods) must agree on a single project and location.

The winning vote “could be anything from 7 to nothing, 6 to 1, 5 to 2, as long as it meets the criteria,” Harbach said.

Getting to that point begins with each commissioner individually weighing all the information from this week’s hearings and the entire process and drawing a conclusion. Then, they will discuss their individual choices during executive session to see if they have a qualified majority in support of one project. If not, board members will discuss and debate their choices, also in executive session, until one applicant has the necessary support. At that point, the decision will be announced.

The process is much like that of a high court, Harbach said. The majority will detail in their decision why they chose the winning applicant. There may be a dissenting minority opinion released as well, Harbach said, as there was in 2011 when former commissioner Kenneth Trujillo cited financial issues in his decision to support the Fernwood proposal near Bushkill in the Poconos while the rest of the board voted to grant a license to Nemacolin Woodlands in Farmington, south of Pittsburgh in Fayette County.

Whichever applicant the commission chooses, construction won’t start immediately with the announcement.

Every casino license the state has awarded has been appealed, he said. No PGCB decision has been overturned by the courts. The only awardee to lose its license was Foxwoods, and the PBCB revoked that license after Foxwoods failed to build in what the board thought was a reasonable amount of time. That license is the one the board is now pondering.

Pennsylvania gaming law sends license appeals directly to the state supreme court to expedite the process. When the original license decisions were made in 2006, the appeals were finished within a few months, Harbach noted, while the Valley Forge license appeal took more than a year.

“Nobody’s going to break ground until of of the appeals have been exhausted,” Harbach said.

Here is the Philadelphia license suitability hearing schedule. All hearings will be held in Ballroom A of the Pennsylvania Convention Center, and will be webcast live at the gaming commission’s website, here.

• Tuesday, January 28, 2014 from 9:00 a.m. to 1:00 p.m. – PA Gaming Ventures, LLC (Penn National), proposing Hollywood Casino Philadelphia at 700 Packer Ave.

• Tuesday, January 28, 2014 from 2:00 p.m. to 6:00 p.m. – Tower Entertainment, LLC (led by Bart Blatstein) proposing The Provence at 400 North Broad St.

• Wednesday, January 29, 2014 from 9:00 a.m. to 1:00 p.m. – Market8 Associates (The Goldenberg Group, Mohegan Gaming and others) proposing Market8 at 8th and Market streets

• Wednesday, January 29, 2014 from 2:00 p.m. to 6:00 p.m. – PHL Local Gaming, LLC (led by Joe Procacci), proposing Casino Revolution at 3333 South Front St.

• Thursday, January 30, 2014 from 9:00 a.m. to 1:00 p.m. – Stadium Casino, LLC (partnership between Greenwood Gaming and The Cordish Companies) proposing Live! Hotel & Casino at 900 Packer Ave.