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Casino critizes Select Board for delaying agreement

Dec. 19, 2013
By Chris Maza


LONGMEADOW – As the Select Board continued to wait for recommendations from its traffic and pubic safety consultants, MGM Springfield sent the town another surrounding community agreement proposal and criticized the lack of response to the gaming company’s prior efforts to get a deal done.

MGM had set an internal deadline for completion of surrounding community agreements of Dec. 15 so as to be able to send its RFA-2 application for a Category 1 gaming license to print prior to the Massachusetts Gaming Commission’s (MGC) deadline of Dec. 31.

Because Longmeadow representatives had not provided a counter proposal as of Dec. 13, MGM withdrew its initial offer and made a new proposal to the town.

In a Dec. 13 letter than accompanied the new offer, Michael Mathis, MGM’s vice president of Global Gaming Development, told Town Manager Stephen Crane that he was “disappointed” in the lack of progress in negotiations and took issue with what he called “an unnecessarily adversarial posture taken by the town’s outside counsel in these negotiations.”

“I believe that our efforts with Longmeadow to-date, as well as our success over the last couple of weeks in obtaining surrounding communities agreements from your peer communities, are evidence of our collaborative and good faith approach throughout this process,” he said.

Mathis complained that, at the time of the writing of the letter, MGM had yet to receive a counteroffer to the company’s initial Nov. 19 offer that included a “look back” approach to mitigation. Five of the seven communities to which MGM made proposals have accepted, he added.

But, “in a final good faith attempt to reach a resolution and despite never receiving a counteroffer from Longmeadow to-date,” Mathis said MGM was willing to offer Longmeadow a “Tier One” status community agreement.

He explained that communities identified by MGM as Tier One – which thus far include Agawam, West Springfield and Chicopee – were offered higher guaranteed minimum payments than Tier Two communities such as Ludlow, East Longmeadow and Wilbraham. MGM also told Tier One communities that accepted its proposal that it “would not enter into a surrounding community agreement with another community on more favorable terms.”

The offer would be on the table until Dec. 20.

“If, in the meantime, Longmeadow makes a materially different counteroffer, we will of course review such offer, but will deem it as a rejection of this offer,” he said.

The new offer called for an up front payment of $125,000 for reimbursement of consulting and legal fees, $100,000 in guaranteed minimum annual mitigation payments, plus a total of $750,000 in payments over 13 years for reimbursement of costs associated with annual impact studies.

“Look back” studies would be conducted in years one and five by a third party selected by MGM with the intent of determining the net negative impacts to the community. MGM would pay any dollar amount exceeding the $100,000 annual payment only if the town was unable to access that money through state mitigation funds.

Crane told Reminder Publications that the Select Board would not have a response for MGM until it heard from its consultants. He told the board at an earlier meeting that he believed if the town operated under the Dec. 31 deadline set forth by state legislation, it would be negotiating in good faith.

“We are finalizing our work with our team of consultants and we intend to use that information for the basis of a fair counterproposal,” he said.

At the Dec. 16 Select Board meeting, Crane told the board they could expect the results of those studies by Dec. 17. The board then voted after a lengthy and heated discussion regarding the board’s role in and timing of the negotiations to allow Brandon Moss of Murphy, Hesse, Toomey & Lehane, LLC, to form a counter proposal based on those findings. The counter offer would be vetted by the board prior to being sent to MGM.

Mathis also said there was a public perception that “it is pointless to attempt to negotiate a surrounding community agreement with Longmeadow” because the town’s leadership is “unconcerned with the resurgence of Springfield or the economic development that we are attempting to bring to the Western Massachusetts region.”

“The conduct of certain members of your Select Board and a recent Town Meeting vote contribute to this perception,” he said.

Mathis did not specify to which selectman he was referring, however, at the Nov. 5 Special Town Meeting, a warrant article calling for a resolution that stated the town was opposed to casino gaming in Springfield was put forward by No Casino Springfield, a group of which Selectman Alex Grant is a member.

Grant also recently sent a pair of letters to the MGC, as well as the press, criticizing MGM and accusing them of delivering false information to the commission during a presentation in an attempt to minimize the proximity to and potential impact of a downtown Springfield casino development on surrounding communities such as Longmeadow.

In response to Mathis’ assertions, Grant replied in a Dec. 16 letter of his own, stating that the two issues are not interrelated.

“I have never attempted to link the issue of your payment to Longmeadow under a surrounding community agreement to the support or non-support of MGM's bid for a license, as you apparently are doing,” he said. “The vote at our fall Town Meeting against your project, of which you apparently disapprove, was done because the gaming statute passed by our legislature required that the views of surrounding communities be considered in awarding a license. It was our right and our duty to take that vote.”

Grant went on to express his belief that the Select Board would not be bought off by a Tier One distinction.

“I believe it would be improper to trade our support or silent acquiescence to your plans for a larger surrounding community payment,” he said. “Likewise, it would be improper for you to condition payments that you owe Longmeadow under the gaming statute upon our support for your company, your project, or casino gambling in general.

“The surrounding community payment should be based on the facts and nothing else. In other words, the payment depends on the particularized impact your project will have on Longmeadow, which is something my colleagues and I are studying carefully,” he continued.

He also criticized Mathis’ comments regarding the board’s feelings pertaining to the economic welfare of the region.

“I reject your suggestion that I, and the many other people who feel as I do, such as the majority of the voters in West Springfield, are ‘unconcerned about the resurgence of Springfield,’ or economic development in Western Massachusetts,” he said. “Such sanctimony does little to advance the debate over whether casino gambling is good for this area. The people of Longmeadow, West Springfield, and the other surrounding communities have cared about Springfield long before MGM came to town. We work in Springfield, we patronize local businesses in Springfield, and we give money and time to institutions that support Springfield.”

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