Joint Meeting of the Casino Site Committee and the City Council February 26, 2013
Meeting called to order at 5:30 by Council Vice President Buddy Williams
Present: Council President Ferrera, Councilors Rooke, Edwards, Williams, Allen, Luna, and members of the Site Committee, Chair Meara, Mr. Thomas, Dr. Markey.
Public Speak Out
Jose Claudio, resident of Clayton St, Springfield stated we have waited and we are going to have a casino in Springfield. Important to split the money three ways; school, public safety and a general fund for residents and for everything that needs to be done. Also that the casino should be built in two years in one phase.
Dean Jim Monroe of Christ Church Cathedral states he is here in two roles. His secondary hat is as a member of the Pioneer Valley Project (PVP). He is here with Deacon Bill Toller and Jason Gurand, a Union Representative, also for the PVP. PVP has been meeting and have concerns to mitigate the harmful effects and to encourage the positive effects. Would love to sit down with the City Council to support you and be of assistance in this project.
Jason Grand from the Carpenters Union. Appreciates the information. It’s important to our community to bring this project forward. Important issues include homelessness, how jobs are being created, etc, and the PVP should be a part of the conversation. PVP would like to speak to the City Council. They have questions, one is they want to know what is a geographic circumference. PVP wants people to be able to become union members. Neutrality is critical.
Deacon Toller explained the PVP saying it is a coalition including Christian and Jewish faiths, also labor unions.
Norman Roban spoke stating he is a New North Community Council representative and they voted in support of a casino in the neighborhood. He is a proud property owner and taxpayer.
The casino is an important resource. A one-phase project is key.
Frank Rossi, President of Local 404, the International Brotherhood of Teamsters, representation includes United Here and the Operating Engineers and Stage Hands. The Teamsters represent over 100,000 workers in this country and includes lower echelon workers such as valet and yard work. He wants Springfield to know where the developers are with labor. He wants workers to have a right to get a contract that insures they get a fair share of the work. One of the players has met the level of corporate responsibility at this time and only one has been in negotiations including both the project labor agreement and the prospective employees. Only one developer has met the bar.
On second front they have negotiated a neutrality agreement with MGM, allowing the unions to speak to the workers, including the right to go to binding arbitration for a contract. MGM has agreed to benefits that include health care. MGM signed that agreement to date and the unions have not heard from the other player. He has reached out several times and Penn said they'd get back to them but they have not. Mr. Rossi would give Penn the same access.
With one operator, MGM, we are assured our people will have discretionary money to spend in our community.
Councilor Williams asked for clarification on representation, on the meaning of a signed agreement and if people have to join the union.
Mr. Rossi clarified the signed agreement is with MGM and it allows a neutral approach. MGM will not sway the employees not to join the union or give out negative information about unions, but will allow the unions access in a neutral way.
Councilor Williams questioned Mr. Rossi regarding some vs. all of the employees belonging to unions and Mr. Rossi replied this was a subject of negotiations to achieve a collective bargaining agreement. Discussion continued regarding Councilor Williams’ concern over the inclusion or exclusion or of non-union, independent shops.
Councilor Ferrera introduced the panel Paul Marquez asked a group question to Mr. Rossi and unnamed others regarding agreement on percentages of union construction jobs.
It was stated Springfield is In competition with other cities, if we don't move quickly we may remove ourselves for the opportunity for economic growth. He is on the record as a taxpayer to support the fact that we want to move forward with one casino.
Frank Ryan spoke for the East Forest Park Civic Association (EFP) and supported that casino income be available for all of the 17 neighborhoods in the city. EFP has waited for years for funding. They have not received state and federal grants as have other city neighborhoods and he understands that. EFP has waited and waited. He has children in the military and has seen cities across America that vibrantly attract new families. Springfield needs to look at EFP from that point of view.
EFP is the densest areas for seniors in Springfield, many residents being 70 to 90 years of age.
Springfield needs to invest in this solid neighborhood. Our city would be fiscally wise to attract these young homeowners. Improvements, including some in outdoor attractions would be critical.
He spoke of participating in Rebuild Springfield and suggested taking ideas regarding building Infrastructure from their plan, include considerations into building a community center or a library or a media center and upgrading Nathan Bill, that is in need of repair, also improving sidewalks and trimming tornado debris, especially along waterways, and moving our public schools into a future for the whole city.
Eddie Corbin, a lifelong Springfield resident living on Balboa Dr, said he was a member of Penn Nat Gaming Committee, but speaking as a citizen, Springfield definitely needs a casino and should have voted it in years ago. Would hope any selection addresses not only the community it sits in but in all the neighborhoods. He believes this should be addressed in the Host Agreement, and also fair representation for city residents as employees. He believes the casino should not only build in a single phase but completes the initial project and continues beyond.
Heriberto Flores, President of New England Farm Workers (NEFW) etc, here to disclose that years ago he was chosen by then Gov. Jane Swift to consider if we should have a casino, submitted a report, glad city has followed this process, very important, game changer for the City.
Big, big, big deal for City. This City has been in a bubble for many years. The city will either die or survive. Under the Control Board, decisions were made in Boston that were not good for Springfield. Now we have a chance for a development of 800-900 million $. Personally he supports Penn, as the owner of the Paramount he is investing 54 million $. Scary when you are talking about spending 51 million but other people are talking about investing 800 million. Many years ago he started buying property when the control board was here. When he was came over here as farm workers, the city helped us. The city is not white anymore, 75 % minority, black and Puerto Rican. Homeowners should get a break. Give a break to the people who have worked for the city for many years. Good you have a professional advising you and the city. He’s talked to all of them, including MGM and Ameristar. We have a chance. We have the best water, sewer, and electricity. We can handle a casino. People who are willing to work. Good luck, I love you, but I think Penn National is the best for the City.
Final call for public speak out is given.
City Council President Ferrera introduces city councilors and members of site committee then indicates we are here to continue the discussion into what should be incorporated into a Community Host Agreement. Our meetings are open to the public. He thanks Comcast for carrying the meetings live for people who may be home.
Atty. Sid Froelich states by contract, both developers will build in one phase.
After all the RFPs are examined, the handouts, the technical issues are all discussed in depth now, including even traffic. Also some were inspirational and now we are pretty much in sync and we understand what each developer meant in his proposal.
The HCA will be about a 115-120-page document. Nothing will be left to chance. An example is how many people will you hire locally, regionally, or fly in for a specialty, what is the percentage guaranteed for minority, women, etc, training questions. Both developers had inspirational comments in their RFP, now we are going to put them in a contract. You will do it or you won't do it. The final document will be our 5th iteration in this type of document, a kind of boilerplate, refers to a genuflection before the Gaming Commission; tourism, community involvement, etc.
After that they go into specifics of what each developers proposed, Both proposed designs, designs are attached and if city sees it changes significantly, will need City Council approval. Same with x # of jobs, it is now contractual, not hope to do, also reporting requirements for data both first year and later, probably have a liaison officer to get detailed reports on things like hiring, both construction and employees.
This is a statutory set up what city can get are impacts, cannot just say give us 30% of your revenues.
One is direct impacts, what casino clearly is causing to happen to the city, i.e., traffic lights, sewer pipes, etc, contract requires those things be paid, if it changes in the future, you will pay those also. Our consultants pretty clearly identified these several millions of dollars per year.
Second category is indirect impacts, noise pollution, light pollution, much harder to put a number on the price. Now it is either a percentage or dollar amounts, that amount is a better way to go so the city is not out a dime. Also the developer will pay real estate taxes. Those are not specified to go to an early childhood or anything else, city must figure out what will have the best impact with those dollars. Our experience shows every member of the council, the staff has an idea of what's important, you could have something that's hundreds of thousands per year. All deserve it but if you load up a Christmas tree with that the developer will walk out. So we have recommended that some be direct, some be indirect Council President Ferrera asks how would the City Council have any fiduciary responsibility over that fund? The City Council would like to see their initiatives funded, the goal is inclusiveness and to work together. Council has initiatives and wants them incorporated into the HCA's.
Atty. Froelich states the contract won’t oversee that fund. The developer is not involved in that process. HCA is between the City and the developer. When City gets that money, that money is not the purview of the HCA. It is up to the city to figure it out. The developer is a party to that agreement and has no impact on you.
Council President Ferrera states representatives of different neighborhoods are coming down and asking for certain things, sidewalks, library, senior center, etc. If we can't say that specifically, then the council will have to work on a way for this to come to fruition.
Council President Ferrera asks why would there be a request to meet with the council? We met two weeks ago and said we'd like to see incorporated, for example, youth activities for the North End for councilor Luna.
Atty. Froelich states in the list he was given two out of twenty would have .a fund set up and most of the list ask for punishments if conditions aren’t met, only two required money.
Councilor Ferrera mentions school safety and early childhood education (ECE).
Atty. Froelich states his only point is that the city understands better than the developer where the money ought to go. He also agrees that what one councilor wants, another might not. Initially we thought three items would be spelled out, ECE and others, now it is clear as they heard from other neighborhoods and groups there are 20-30 things that require funding. It became apparent that we were going to run into a logjam so we felt the best way to do it with the developer would be to say here's an amount of cash and it's up to city officials to figure out how to spend that cash.
Councilor Allen states he wants to be clear on what was said regarding the HCA, the discussion on ECE and Public Safety (PS) will not be part of that. How will the HCA deal with that aspect? Atty. Froelich states the HCA specifies x number of police, x number of fire, x number of a specified category, with a dollar amount up front and on a yearly basis and a provision to open up if something comes up.
Councilor Allen asks about the indirect, will there be some language? Atty. Froelich states you're going to give me x, a minimum dollar amount.
Councilor Allen states so it gives us some barometer, a flat amount, so we get out of the discussion on what's best.
Atty. Froelich says it became apparent as there were such divergent views as he talked to more city people what one believes passionately about is not the same as someone else. Also, there is a political element to this. And some elements to PS, as important as it is to the city, it's more important to the casino. Most patrons agree as they leave casino, it's pretty safe, casinos realize they need to clean up the city. They know they cannot maximize their revenue unless the city is cleaned up. It happened in New Orleans. They had a crime problem. The casino put up floodlights. It didn't work. Nobody came. Casinos now realize there are hidden places, like crime prevention, childcare, both part and full time employees. It doesn't take care of your early childhood issue but it does make a significant contribution, a 24/7childcare contribution. This can't be categorized as extra money but he realizes it is.
Councilor Allen stated people have written letters and would love an investment in certain things and believed until tonight this would be involved in the HCA, but now it's not.
Atty. Froelich states there are details for example about the trolleys, how is it going to stop? When is it going to stop? Stops will become spiffed up areas, an enhancement to the community where that trolley is running. The statute speaks to economic development, community improvement and better things citywide.
HCA is 50 % of issue; other 50% shows the importance of how the asks are, 30 to 40.
Councilor Allen asks about requests from the Council and community and communication regarding that and also about timing. Atty. Froelich will comply with it.
Dr Markey, a Psychologist spoke regarding harm mitigation against individuals being his priority.
Referring back to an earlier presentation, like for it not to be optional, but to have agreements in the contract. People under stress act unpredictably, compulsive gamblers, need to have this in the contract.
Atty. Froelich agreed, saying the statute requires developers and HCA figures out how to deal with it, the dollar commitment, also on site, each developers have agreed to have an on site facility to deal with those types of problems. Helping with the answer was a woman seated with the consultants.
Councilor Rooke agrees with him saying we would be here for 6 years if he tried to deal with all those items. He thinks it ought to be directed back to the taxpayer to distribute the money equally to homeowners and businesses. We need to agree with mayor ahead of time so that there's no squabbling later.
Councilor Williams asks regarding two names being sent to the Gaming Commission (MGC) and says people are confused and thought the mayor sent two names.
Atty. Froelich said no two names have been sent to MGC. Two have identified sites and said they are negotiating with us. The MGC knows they are here and we want them here. Other states do it different. They wait for HCA to be cut then file before their GC. Two parties, the city and the developer submit to the gaming board. It's then that they look into suitability. MA has 11 developers looking into what will be 4 licenses. They are vetting all 11. When the state finishes, the city and the developer can then submit the HCA and referendum.
Nobody else has done it that way. What is at the MGC now is a suitability determination with information such as the number of casinos they run around the world, etc. He has seen applications in similar states, about 4' high.
Councilor Williams asks if the MGC could say this company is not suitable and then they are out.
Atty. Froelich states the process may be concluded as early as May and potentially as late as October.
Councilor Williams asks if it is possible nether one may be suitable. Atty. Froelich says this is not likely; both are licensed in multiple jurisdictions. Depending on the outcome, we will negotiate a HCA, the City Council could vote, submit a referendum, then we could submit to the MGC.
Councilor Williams asks who decides one vs. two casinos and is answered the mayor decides.
Atty. Froelich adds there are two obvious times to take a vote for the best turnout. One is June 25th, the other is September. Depending on which of those dates is realistic, depending on the suitability analysis, then decide on the date for the vote.
Councilor Williams asked the consultant if he has made a recommendation to the mayor on one vs. two HCA’s and is told no. The consultant states they have numbers in their minds on what a casinos can afford. These are the kind of profits they can make, this is what you can expect to get. One company can have commitments elsewhere, other can say I see this as a mid-market place and I'm only going to hire so many, etc. At some point a company will come close together, then one can go up and other may not.
Councilor Williams asks if depending on the best deal for the city will determine the best deal and you will make that recommendation to the mayor? If one company said i'll give you a certain dollar amount a year and hire, say 2000 vs. 10,000? The consultant stated we have Palmer and WS sitting out there. This is critical information that must be confidential.
Councilor Williams asks if one or two come to this body can they vote it up or down, is it in its entirety? He is told they keep asking for these kinds of lists so we can get this into the document upfront so we're not back to a councilor believes a certain provision is essential.
Council President Ferrera asks if there a reason why the HCA can't be a public document and is told it becomes a public doc when it comes to the council. He is told how competitive this process is and what fierce competition Springfield has from Palmer and Hard Rock, a brand everyone knows and we don’t want to give them lead time as all they have to do is offer a little bit more. He knows you have to be transparent but don't give up our negotiating position, don't give up your trade secrets; don't tell the other people what percent you're going to do. If all things were equal, the MGC could take a position that one percent more for Palmer, could be better.
Council President Ferrera asked if that is based on numbers and is told it is based on jobs, financial data, design, and many factors. Dollars are important.
The Council President asks if the HCA could be an actual shell within itself, could that be public, not the responses as he respects the competition. The consultant states there are proprietary things we do better than anyone else that complies with MGC mandates. There are more just published Thursday, not just dollars.
It will be a public document when the council votes on it, giving up a competitive advantage for transparency. We are competing with two other companies. They are not going to sit as silently as today, they will ramp up. You don't want to tip your hand earlier than you have to. We made it abundantly clear that the developers could not talk to anyone. This is a pristine process. It will stand up to scrutiny. They will see it and they get to vote on it, why tip your hand now and give other two cities an advantage? Council President Ferrera doesn't want to give developers the opportunity to come back and litigate a claim of an unfair process. He is told once signed, it is ironclad. When companies lose, they leave.
Councilor Luna asks who has this information and is told the council and the consultants. She asks if the committee that the mayor selected saw it and is told yes, before the mayor made his decision to negotiate with both companies.
Councilor Allen asks relative to timing, once our HCA gets released, is it on the website the day it gets released to us? What about West Springfield and Palmer, when do theirs get released? He is told Palmer is unclear, he's guessing sooner, if they delay, they will get the competitive advantage of seeing it on our website.
Solicitor Pikula states once the HCA is signed, developer will require a referendum within a minimum of 60 days and a maximum of 90 days. That's why we have the Sid as the consultant guiding us. He's a master guiding us on the best interests of the city.
Councilor Allen states he is not questioning this. When we put the HCA public, the competitors will get the advantage of seeing it but we'll have the advantage of getting it there.
The Solicitor adds that both develop said in order to comply with the statute zoning has to be taken out of the way, both said will you take that out of the agenda so it's not an issue. He is encouraging the City Council to establish the right kind of gaming zoning.
The consultant states regarding the RFP responses, the committee signed confidentiality agreements, was shown the responses and they were taken back.
Councilor Williams asked why they were not shown to the council, then what was taken back and Atty. Pikula states it is an issue of MA law, applicable to this body, the open meeting law is not applicable to committees.
Councilor Williams asked if the act requirements would not apply if shown one at a time and the consultant answered they were told the council didn't want that.
Councilor Williams stated that was true, but some folks might want to see that. If folks that are appointed and not elected, it doesn't create a good environment. The consultant states the issue is that if presented to this body or any member of this body, it's public.
Councilor Williams stated it was his understanding that meeting with the consultants one-on-one was what the council didn't want, but meeting with the mayor is another matter. Atty Pikula asked if he wanted to meet one-on-one with the mayor and he states yes, if appropriate.
Dr. Markey stated the city has hired this consultant at great expense. We don't want confrontation. He complimented the consultant’s patience.
Councilor Rooke has to leave shortly and asks if the developers are here, Atty. Froelich stated the developers will be here March 12th per our request for a short presentation, then to answer questions.
Atty. Pikula stated as Atty. Froelich said, we have gotten these proposals in, now we are preparing to negotiate. The first thing to do is what's going to be our ask. The casino companies have made refinements to proposals as a result On 3/11, Kevin Kennedy will be making a public presentation to discuss refinements, most particularly, to two issues; first, traffic; the second issue is one of the components the Gaming Commission has listed in their latest draft to their additional evaluation criteria, i.e., LEEDS sustainability, also non-casino components to this resort developments as that's what the casino calls for, entertainment and other non casino components. That will educate us and give us transparency. The next day we would like to schedule the meeting requested by this body to discuss a number of issues. Based on those refinements, what question does this body have? This is a chance for you to dominate the scene and raise questions. Also you've raised questions to suitability.
Mr. Thomas mentioned at the last casino meeting we had concerns and he believed MGM was coming to this meeting. Is March 12th the date where we can lay out all this. Atty Pikula stated that Atty. Froelich will tell you that you need to think about how you want to do suitability. We don't have the authority; it's the commission. Be precise, if you beat up one of these companies, you're handing fodder to our competition in West Springfield and Palmer. They could ask the Gaming Commission how can you pick that developer, even the City Council doesn't like them.
Atty. Froelich does not believe either developer will be found unsuitable. Keep in mind addressing the zoning aspect as we now have footprints, design, with the proposals in. What do you as developers see as zoning issues that need to be addressed? Chair Ferrera indicated the Council asked Phil Dromey and Kevin Kennedy to incorporate a draft of a new proposal for the Council to review.
Discussion regarding zoning. Atty. Pikula states they are catching up with the Council after seeing what each developer views as issues. The Gaming Commission has put this issue up front, typically zoning issues come after. We need to address that sooner rather than later and in a format that's conducive to getting that done. The developers will talk to you on the 12th about what they see as issues, site plan review vs. the special permit process, etc, so this body will have to get into the meat of that.
Councilor Williams asked what is the last possible date that the HCA should be completed. City Solicitor Pikula indicated it would be best for Springfield to hold a referendum on 6/25. This would require a signed agreement by April 24th and they are working furiously to get that done.
Att. Froelich indicated sooner is better than later, requires information before April 1st as a cutoff date or he won't have time to regroup with developers.
Chair Ferrera asked if it was legal to hold both elections on one date and Atty.
Pikula replied it is a special election and if held the same day to take advantage of the turnout, two ballots will be required.
Atty. Froelich made a point on suitability. He is not sure if we have the resources to do vetting. In this process it is customary that this is done in executive session so as not to damage the rest of the proposal.
City Council Chair Ferrera adjourned the meeting at 7:12 PM until March 12, 2013 at 5:30 PM.