SPRINGFIELD  – For the chair of the City Council’s Casino Oversight Committee there is some significant work ahead to craft a new amendment to the Host Community Agreement (HCA) between the city and MGM Springfield.

After hearing an update on the 54 market-rate apartments MGM Springfield is supposed to build and operate on June 8, City Councilor Michael Fenton noted how the new plan was to have MGM Springfield pay $11 million into the $35 million to $45 million budget to create a mixed use complex at 31 Elm Street that would include 60 apartments, only 48 of them market-rate with 12 “workforce housing” units.

Fenton then explained there are three points in the HCA that must be addressed. He said the HCA stipulates there must be 54 market-rate apartments, that are “owned, operated and branded by MGM” and the total square footage of the apartments would be 65,000 square feet.

Under the new plan, MGM would finance 48 market-rate units with a combined size of 46,000 square feet and would not be the owners or landlords.

The City Council would have to approve an amendment to accommodate the changes, which would then have to pass the Massachusetts Gaming Commission.

MGM will also be asking the Council for an extension on the timeline the apartments would require for construction.

City Solicitor Edward Pikula assured the councilors present the city intended to “hold MGM to terms.” He added, “We knew there would be some negotiations.”

Pikula described the planned renovation of 31 Elm St. or the Court Square building with MGM’s financial assistance as “kind of the best thing we could have done.”

He continued, “This wouldn’t have happened if we didn’t have MGM.”

Under the proposal, MGM would return the former School Department building at 195 State St. to the city and the city could keep the sale price MGM paid to it.

MGM Attorney Seth Stratton said, “MGM remains fully committed to this exciting partnership … we really are excited to be part of this.”

Fenton asked the city’s Chief Development Officer Kevin Kennedy how the figure of $11 million was determined to be MGM’s portion of the budget. He said it came through negotiations about the value of market –rate apartments.

“I was looking for a lot more and they were looking for a lot less,” Kennedy added.  

Michael Crowley, the consultant to the developers Opal/Winn of 31 Elm St. explained that various options for redevelopment had been considered during the time Opal has been the preferred developer of the building. These included a boutique hotel, housing and office space. There was also a plan to build a hotel that would be leased to MGM, he said.

None of these were economically feasible, he noted. The current plan of retail on the ground floor, offices on the second and then 60 apartments developed with financial assistance from MGM is the best, he said.

Stratton said the city asked MGM to hold off on its commitment in order to be part of the 31 Elm St. project, he noted though “What’s in the HCA we could go do … the city doesn’t want us to.”