EagleTribune.com, North Andover, MA

June 26, 2013

Mistakes at Salisbury slots presentation causing concern

By Angeljean Chiaramida
Staff Writer

---- — SALISBURY — When selectmen meet next week to consider the proposed slots-only casino that Cordish Companies wants to build on Route 110, they’ll be discussing a lot more than they thought.

That’s because yesterday the Maryland real estate developer’s representative, Jeffrey Snyder, said he misspoke when telling selectmen Cordish is proposing to build a 12,000-square-foot gambling facility in town. The true size would be 120,000 square feet, Snyder said yesterday when The Daily News called after questioning if his numbers were accurate. He apologized for his mistake, promising to clear up the error with officials immediately.

A 120,000-square-foot facility — slightly smaller than Seabrook’s WalMart — is more amenable to being the state’s one-and-only allowed slot machine venue that Snyder described Monday night, but it’s 10 times larger than selectmen thought it was going to be. By state law Cordish would have to make a minimum of a $125 million investment to create an establishment that could hold a maximum of 1,250 slot machines, Snyder said. But the “world-class” slot casino Snyder proposed would also hold at least three restaurants and a small theater featuring live entertainment, allowing hundreds of employees to cater to thousands of patrons, 24 hours a- day seven days a week.

After listening to Snyder’s original pitch for the 12,000-square-foot venue, selectmen didn’t say “yes” and they didn’t say “no,” but voted unanimously to hold an informal workshop at 4:30 p.m. on Monday to scope out Cordish’s proposal before taking a vote at 7 p.m. on whether to proceed with the project.

Selectmen Don Beaulieu and Freeman Condon said yesterday they don’t think Snyder purposely deceived them, but the error raises concerns. That’s especially true because Cordish’s Monday night PowerPoint presentation had another major error. It listed the number of slots allowed as 12,500, instead of 1,250, selectmen said.

Beaulieu and Condon said the larger size isn’t the issue, but the errors have shaken their confidence in how much they can trust Cordish’s projections on the impact and benefits the “slotsino” could have on Salisbury.

“I would still have agreed to the workshop,” Beaulieu said yesterday, “But the mistake has an impact going forward with a company that made a presentation with that kind of error. I have to think about that.”

According to Snyder’s estimates, the development would bring 600 temporary construction jobs during the year-long building project during 2014, opening in 2015 with 700 permanent, year-round jobs available in the slots casino, from gaming, security, marketing, food service and administrative positions. Traffic wouldn’t be a big problem, he said, because the site is very close to interstates 495 and 95, bringing people quickly to the venue.

Condon, who twice challenged the small size as being able to accommodate the Cordish projects, said he gave Snyder two chances to change his figures at the meeting.

“Twelve thousand square feet was just too small; it didn’t make sense to me,” Condon said. “I don’t think he purposely presented misinformation, but these mistakes don’t give me a lot of confidence about the proposal made by this company. I don’t think (Snyder) is as prepared as he should be to make a presentation of this magnitude.”

Timing

Exacerbating the problem is that Cordish hasn’t given Salisbury officials long to get to know them or ponder the deal, since selectmen only learned about the proposal Monday night and have to sign a complex hosting agreement by July 25, to complete the first phase of the state-required process to bring gambling to Salisbury.

After that, voters must approve the proposal through a special referendum that can take place no later than Oct. 1. The hosting agreement must be signed and posted for voter review no later than 60 days before the referendum, Snyder said, putting the pressure on for speedy negotiations so the referendum can be posted no later than Aug. 1.

By Oct. 4, all the companies bidding for the slots casino have to file their applications with the state gaming commission, which has promised to pick the winner by the end of the year.

The quick turnaround time makes it hard for selectmen to do their homework, investigating the history of similarly sized, slots-only casinos in areas that mimic this region’s population base and weather patterns, and such casinos’ history of financial viability, as well as community and commercial impact on their host communities.

Selectman Chairman Henry Richenburg said after selectmen discuss the proposal at the workshop Monday night, they’ll move straight into a formal session at 7 p.m. At that meeting, they’ll vote “yea or nay,” Richenburg said, on negotiating the hosting agreement and contract with Cordish. Under the state’s casino gambling regulations, the agreement is required and would delineate the basis for the partnership, outlining what the town would specifically receive and require from the Baltimore-based casino developer if it is allowed to site in Salisbury. It could include the amount of money the town gets annually from Cordish in impact fees and other revenues, along the preferential hiring of local residents and vendors.

More than $1 million is offered to Raynham in its hosting agreement with former greyhound race track Raynham Park, vying with other companies to win the license for the single slot-machine parlor allowed by state law. Also permitted are three full-service casinos, along with one Indian-owned gambling venue.

Beaulieu chastised Snyder at the meeting for not providing a detailed written proposal earlier, allowing selectmen time to review it before the meeting. He also questioned why the town was getting the proposal so late in the game.

Cordish paid the state’s $400,000 fee to be one of the slot casino contenders last fall, Snyder said, admitting that before Salisbury, the company had approached other communities, like Boxborough, which had turned down the opportunity. Snyder assured selectmen, after considering the local site, Cordish believes it’s so ideal it could win its bid for the slots casino.

Cordish optioned land owned by Bruce Arakelian, the current site of Vision Max theater complex and Sylvan Street Grille, he said. Its location, near Interstate 495 and 95 and within a short drive of Lowell, Lawrence, Methuen, Haverhill and southern New Hampshire, make it a choice spot for the regional facility, Snyder said. In addition, he added most of the infrastructure needed is already in place, for the land is already developed on a four-lane, busy secondary state highway, with water and sewer available.

“We do only world-class venues,” Snyder said. “This would have enormous benefit for the town and the state.”

The money involved is considerable, for if chosen, Cordish will pay a $25 million licensing fee to the state, also paying into Massachusetts coffers what’s equal to 49 percent in state taxes on every dollar earned at the slots, he said.

In addition to hosting agreement revenues, Cordish would pay local property tax and all normal fees, Snyder said, while also contributing to local charities, and helping the economy grow through jobs, while creating new or increased opportunities for other local businesses.