As Encore Boston Harbor looks to expand its gambling offerings into a new development across the street from its existing casino, state regulators are revisiting the 2013 referendum through which Everett voters backed the casino to try to suss out exactly what it was that city residents approved.
Encore parent company Wynn Resorts wants to construct a new building across Broadway from its resort casino to host a dedicated poker room, second sports betting parlor, a new nightclub, a theater, parking garage and more. The Gaming Commission ruled in March that a previous draft of Wynn’s proposal — one that did not include any gaming areas — would not be part of the official gaming establishment and therefore would not fall under commission jurisdiction or oversight, an outcome the casino had lobbied for.
But Wynn has since changed its plans and now wants its “east of Broadway” expansion to include both casino gaming (poker) and sports betting, which would require the facility to be regulated by the Gaming Commission. And because the state’s 11-year-old casino-style gambling law “is silent when it comes to expansion of gaming operations beyond the footprint of the existing gaming establishment,” commission general counsel Todd Grossman said Wednesday, the Gaming Commission is in uncharted territory as it considers Wynn’s expansion.
“When that earlier proposal came in front of the commission, one of the things that was one of the issues that we raised at that time was whether or not the city-wide referendum that was conducted in 2013 would be sufficient to cover this additional property. Because the commission determined that the proposal was not part of the gaming establishment, that question never needed to be answered,” Joe Delaney, the commission’s chief of community affairs, said Wednesday. “But because this new proposal would need to be part of the gaming establishment to operate, this question now does need to be answered.”
In essence, the question the commission has to answer is whether the language of the June 22, 2013 referendum that cleared the way for the casino to be located in Everett authorized casino gaming at just the location specified on the ballot or whether voters approved of Wynn’s casino license generally.
The precise question before Everett voters in 2013 was, “Shall the City of Everett permit the operation of a gaming establishment licensed by the Massachusetts Gaming Commission to be located at the property located on Horizon Way (off ‘Lower Broadway’) in Everett, formerly known as the Monsanto Chemical Site?”
The state’s gaming law prescribed the referendum language and required that it include a description of the proposed location. But the same section of the law also includes a line that says that if a majority of voters are in favor of the referendum, “the host community shall be taken to have voted in favor of the applicant’s license.”
“The analysis turns on whether you interpret this subsection 13 to mean that the voters approved of Wynn’s license generally, or you view the inclusion of the specific parcel on the ballot as an indication that the favorable vote approved that specific parcel, meaning the former Monsanto chemical site on Horizon Way,” Grossman said. “I think there’s general agreement that the location across the street is not part of the former Monsanto chemical site. So there are those two competing, if you will, provisions … of section 13. Once the commission answers that question, the answer to whether gaming can be allowed across the street will flow relatively naturally.”
Jacqui Krum, Encore’s senior vice president and general counsel, said the site of the proposed expansion was not part of the Monsanto chemical site. But a lawyer for the casino company argued Wednesday that the 2013 vote approved the license generally and the content of the host community agreement between the casino and city, which included language that suggested an expansion could eventually come into play.
“The host community agreement between Wynn MA and the city of Everett does specifically contemplate that Wynn may undertake substantial new construction on property other than the current Encore Boston Harbor site,” Tony Starr, an attorney at Mintz Levin who represents Wynn Resorts, said.
Starr pointed to the very first recital in the agreement, which reads: “Wynn, directly or through an affiliate, has or will acquire land and options to acquire land in the City in and around the area depicted in Exhibit A (the ‘Project Site’).” Exhibit A was a map of the site that now hosts Encore Boston Harbor.
“So the recital says in and around the area, which I think right away tells the reader that there may be opportunities beyond just what’s in Exhibit A,” Starr said. “And then with more specificity, if you turn to page four of the host community agreement, there’s Section 1 which deals with the impact fee payment of rent and then Section 2, which deals with the PILOT payment. And both of those have language which anticipates a project change in new construction.”
The commission made no decision Wednesday, but the commissioners, their in-house lawyers, their outside lawyers, and lawyers for both the city of Everett and Wynn Resorts batted the issue around at length. The discussion got deep into the weeds at times, like parsing whether the host community agreement’s mention of the “project site” referred just to Exhibit A or “land in the City in and around the area depicted in Exhibit A.”
Commissioners asked Wynn to produce an overlay showing exactly what land used to be part of the Monsanto chemical site and where its new development would sit in relation to that property. Commissioner Eileen O’Brien also said she would like to hear from other communities that host casinos (Springfield and Plainville) since a commission decision around casino expansions like the one Wynn is proposing could have effects there.
“I am curious to know about the other municipalities that could potentially be in this situation, what their perspectives are,” she said. “It is a conundrum in terms of whether this is a bright line or whether we are supposed to be interpreting voter intent.”
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