The House Gaming Oversight Committee met Thursday morning to take testimony on a bill that would open Foxwood’s license up to state-wide bid.
But the Foxwoods team hasn’t given up on the license. And committee chairman Curt Schroder said no re-issuing is likely to happen until Philadelphia Entertainment Development Partners’ appeal of its license revocation has been exhausted. “I don’t see any way that we could do that until the appeal is exhausted, realistically,” he said.
That’s likely to take at least one or two years, Schroder said during a pre-meeting interview.
He said it was important for the committee to determine what would happen to the license should Foxwoods lose its appeals. To do otherwise would create further delay, he said.
The gaming board seeks clarity on whether the bill would direct them to look only at the highest bidder for the license or if they should consider a combination of the bid and the potential revenue generation of a proposed location, Schroder said. The original intent was only to look at the bid, but the other option should be considered, he said.
Schroder said the legislature, not the state gaming board, needs to establish guidelines for how a revoked license is to be re-awarded.
At the beginning of the hearing, Schroder said the bill would free the license for state-wide bid, but Philadelphia would still be eligible for it. Within 30 days of the end of an appeal process that upheld the decision to revoke, an auction would be held, he said.
Rep. Rosita Youngblood, the committee’s other co-chair, requested the Philadelphia hearing. In her opening remarks, she strongly expressed her desire for the second license to remain here. “The people of this city are eager to apply for the full-time jobs it would bring,” she said. “I am also concerned that if Philadelphia does not get the second license, the legislature will require it to pay back some of the revenue it has received,” based on the assumption that there would be two casinos.
Today’s hearing is the second on the bill. The previous one was held in Harrisburg. No further hearings are scheduled, said Schroder, but the committee will compile and study the testimony and possibly tweak the legislation before voting it out to the House. Generally, those who testified that the Foxwoods license should stay in Philadelphia focused on jobs and tax revenue that a second casino would bring and other developments it could spur. Those who opposed the casino focused on gambling addiction, and the idea that SugarHouse’s less-than-predicted slots revenue shows the local market is already saturated and cannot support a second casino.
Deputy Mayor for Planning and Commerce Alan Greenberger testified that Philadelphia is the best place in the state to locate the license. But precisely where a second casino goes is vitally important, Greenberger said. And the city needs input on that location.
Many of the issues that Foxwoods struggled with were directly related to their site at Delaware Ave. and Reed Street, he said.
Greenberger told the committee that the city does not have a list of favored sites composed. Creating one would have been a hypothetical exercise since until recently, Foxwoods held a license and was told to focus on the waterfront site, he said. But Greenberger indicated a desire to put a casino where it could leverage other development, such as a convention center hotel.
In an interview outside the chamber, Greenberger said a second convention center hotel will be needed after the expansion. A casino could help make that happen, he said. “It would be a really great thing if a second casino in Philadelphia could be used to leverage more economic development,” he said.
The convention center area is obvious, he said, as the city has been trying to revive Market East for a long time, and is continuing to work with a master plan to do so that was first developed when Foxwoods was interested in moving from the waterfront site to the old Strawbridge & Clothier building. (During the hearing, Greenberger expressed the city’s frustration that while city employees had worked hard at the Strawbridge proposal, Foxwoods seemed to do little. The casino never requested a change of location from the gaming board, which eventually told them to stay focused on the waterfront site.)
But Greenberger said there are other leveraging opportunities, including the Delaware River Waterfront. Specifically, he mentioned the Andersen site, a.k.a. the old Conrail site, which had been a contender in the last go-round.
Greenberger said he was intrigued with the idea of putting a casino in the SS United States, as it would have accomplished so many goals at once. When casino entrepreneur Steve Wynn was working with Foxwoods, Greenberger called his office and suggested the idea, he said. “They were very polite and said “thank you, but it just doesn’t fit our model or profile,'” Greenberger said. Other than Vegas, a “wonderland,” most casino developments are just not that adventurous, he said. It’s a business, and its investors are not willing to take those kind of chances, he said.
City input is absolutely key if any future Philadelphia casino project is to proceed more smoothly than the Foxwoods project did, Greenberger said. The state could have saved itself a lot of time and aggravation had it asked for city input on the Foxwoods site, he said, as problems were identified by both the city and other agencies, including PennDOT, at the very beginning. Greenberger suggested that one way to handle this might be severing the approval of the license from the specific location.
During the hearing, Greenberger testified that SugarHouse has not resulted in an increase in crime. There was one highly publicized pistol whipping incident when it first happened, he said, but nothing like that has happened since.
Attorney Paul Boni, speaking as a board member of Stop Predatory Gambling, urged the committee not to reissue the license at all.
The benefits of casinos are far outweighed by the social costs, he said. Boni urged the committee to investigate where the bulk of casino revenues come from. Their research would show, he believes, that it comes from problem gamblers and addicts, not recreational gamblers.
Patrick Gillespie, business manager for Philadelphia building and construction trades union, said the math was pretty simple, so far as he’s concerned. “It will create close to 600 jobs to build it,” he said. And then afterward, his union’s members would be employed for maintenance work, as they are at SugarHouse and Parx, and to build any additional projects that could spring up near the casino.
“Anytime something new happens, it can lead to something else,” Gillespie said.
Rep. Mike O’Brien, D-Philadelphia, said he is very concerned about the saturation issue.
SugarHouse has plans for future phases that include the expansion of the casino, a hotel, and a condo development, he said. “Isn’t it in the building trades best interest to have SugarHouse do well as the one and only casino, and do those (condominium) towers?” he asked.
Gillespie said if saturation could be proven, then yes, that would be the case. But he doesn’t think saturation has been reached. Those who wish to gamble are either going to spend their money in Pennsylvania or New Jersey, he said. And the saturation argument is just the latest tactic of people who never wanted casinos in the first place.
In the interview after his testimony, Greenberger said that a second casino might actually help the first one do better. He said there is a phenomenon where a group of like businesses draw more customers to an area than a single business would – which is why malls always have more than one shoe store, for example.
Uri Monson, executive director of the Pennsylvania Intergovernmental Cooperation Authority, testified that PICA has told the city administration it should not count on any revenue from a second casino in its upcoming five year budget plan.
After the hearing, local anti-casino activists started shouting to the scattering committee members that they did not want another casino in Philadelphia. Some of them met up with committee members near the door and had normal-volume conversations about their concerns. One of them: Most people didn’t have much notice of a hearing, and they would have liked a chance to testify.
Schroder said that he sees no need to hold another hearing, as the testimony presented a representive sampling of the various viewpoints.
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Monson, PICA executive director.
Dianne Berlin, Casino Free Pennsylvania.
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