On February 25th and February 26th at the Boston Convention and Exhibition Center, the members of the Massachusetts Gaming Commission presented their reviews of the category 2 (slots-parlor) applications submitted by PPE (The Cordish Cos.) in Leominster, Penn National Gaming (Springfield Gaming and Redevelopment) in Plainville, and Raynham Park in Raynham.

The information presented below will lead to public deliberations on Thursday, February 27th and ultimately result in the issuance of the Commonwealth’s sole slots license, which is anticipated by February 28th, 2014.

Please note: Each applicant will be referred to below by the proposed host community.

VIDEO: Members of the Massachusetts Gaming Commission introduces the final review presentations

Each of the five Commissioners took the lead on overseeing a group of advisers and industry experts to evaluate each gaming proposal based the Commission’s key five evaluation categories including: Finance, Mitigation, Economic Development, Building & Site Design and Overview of Project.

Summaries of each Commissioners’ findings are below, accompanied by links to the full presentations.

These final steps of the ‘Evaluation Process’ are being conducted in an open, public manner consistent with the Commission’s mission statement of creating a fair, transparent, and participatory process for the arrival of expanded gaming. This award marks the first expanded gaming license to be issued by the Commission.

The submitted slots applications are available online for viewing here.

Presentation | Appendices

Leominster | PPE: VERY GOOD / SUFFICIENT

This Applicant offers a well-documented overall design concept emphasizing an upscale entertainment venue with three features – gaming, dining, and live entertainment – each of which is a draw in and of itself. The dining is directly accessible from the building exterior. The Applicant has demonstrated that it is focused on an excellent customer experience in all its offerings; supported by observation of Maryland Live!

Overall the application is satisfactory to very good. It excels with its approach to a balanced entertainment venue. It meets all requirements for utility connections and improvements, storm water management, green energy, and LEED Gold target. It proposes a centralized heating and cooling plant with a cogeneration facility of 1.5 MW generating capacity – reflecting a long-term investment, improved energy performance, and protection from grid failure. Parking and landscaping plans were well developed and thoughtful.

Only 3 of 79 questions were rated “insufficient” and two of these were in common with the other two Applicants. The third, question 4-39 “integration with Surrounding Venues” is somewhat of a misfit for this site which is relatively isolated from existing development. A concern does exist that the Applicant’s schedule to open the facility by the end of 2014 is overly optimistic, and that the coordination of permitting and construction could delay the opening 3 to 6 months.

Plainville | SGR: VERY GOOD / SUFFICIENT

This Applicant provides an integrated design approach marrying the existing harness racing venue and simulcast with the slot parlor in a well-developed concept. The application highlights the continuation of harness racing as a feature of the site, thereby connecting with the local economy and horse racing industry (e.g., horse farms) in Massachusetts.

Overall the application is satisfactory to very good. In addition to supporting harness racing, it offers other non-gaming amenities including meeting and conference space, and, on a small scale, a performance venue. Its site plan benefits from an integrated parking garage for customer convenience and a visually attractive track and open space. It makes a strong presentation on connections with regional attractions including Gillette Stadium, Comcast Center, Wrentham Outlets, and TPC Boston (championship golf course). It meets all requirements for utility connections and improvements, storm water management, green energy, parking, landscaping, and LEED Gold target. It credibly demonstrates the ability to recycle all stormwater and rainwater fully and effectively. It also added credibility to its LEED scorecard with a LEED Gold Action Plan.

Plainville proposes as part of its traffic plan to make a cut through the Route 1 median barrier to improve access to the site from I-495. There is a risk that this plan will not be permitted by MassDOT and/or the Federal Highway Administration which, if not resolved soon as proposed or in some alternative plan, could delay the opening of the project. And though the Applicant proposes an early opening with 500 slot machines it is not clear if this would be allowable or desirable ahead of the final traffic improvements.

Raynham | RP:  SUFFICIENT / INSUFFICIENT

This Applicant presents a phased approach, including a temporary early-open gaming facility, with ample room for future slot parlor and commercial development possibly supported by the potential South Coast Rail Project. It incorporates gaming, simulcast, and multipurpose space into an internally focused facility set in a large parking area. However, when compared to the other submissions, the application is less developed in its design and documentation.

Its Phase 2 proposal is essentially a large box and many of the non-gaming amenities are not as well-defined as the other applicant submittals. The exterior is dominated by electronic signage. Its landscape proposal lacks detail. The parking field size is unjustified and detracts from the overall look of the site. Further, the Applicant only commits to LEED Silver target in conflict with the LEED Gold target established by the Legislature.

Based on observations of Parx Bensalem in Pennsylvania, Parx is capable of building and operating a successful slot parlor venue. Of the three applicants, this is rated lowest in Category 4, Building & Site Design because it lacked detail, overlooked some requirements, and missed opportunities to present the project in its best light.

Presentation | Market Assessment

Appendices:

• Financial Capability
• Investment Plan
• Market Assessment Appendices
• Market Assessment Redacted
• Operations Plan
• Ratings Overview

Leominster | PPE: VERY GOOD

Leominster/PPE has demonstrated that they have the financial capabilities and direct access to funds required to develop and operate a successful Category 2 casino.  They submitted sound Investment, Market and Operation plans that align with their understanding of the Massachusetts opportunity.  While these plans are individually strong and support the operation of a successful casino, they are not completely aligned with the future Massachusetts competitive marketplace and the operating parameters of a Category 2 license (i.e. tax rate, limit on number of devices and type of devices).

Leominster/PPE’s equity shareholder currently operates the largest casino in Maryland as measured by gross gaming revenue.  While significant components of this experience base were used to support the various plans contained in their submission, this is the only casino that Leominster/PPE currently operates.

Plainville | SGR: VERY GOOD / OUTSTANDING

Plainville/Penn National has demonstrated that they have the financial capabilities and direct access to funds required to develop and operate a successful Category 2 casino.  Their submission demonstrated that they fully understand the current and future Massachusetts competitive marketplace and the operating parameters of the Category 2 license (i.e. tax rate, limit on number of devices and type of devices).  This understanding is reflected in the consistency (alignment) between their Investment, Market and Operation plans that they submitted.

Plainville/Penn possesses the necessary experience operating 28 gaming facilities located in 19 jurisdictions.  Each of the facilities operates in jurisdictions that have varying degrees of competitiveness.  The Applicant’s portfolio includes numerous properties of similar size and scope to the Category 2 casino proposed in MA.  The Applicant has significant expertise (corporate head office that supports regional operations) to develop and operate a successful Category 2 casino in a highly competitive market.

Raynham | PR: SUFFICIENT / VERY GOOD

Raynham/PR has demonstrated that they have the financial capabilities required to develop and operate a successful Category 2 casino.  They did not demonstrate that they currently have direct access to all of the funds required to build the permanent casino. They submitted sound Investment, Market and Operation plans.  While these plans are individually viable and support the operation of a successful casino, they are not completely aligned with the current and future Massachusetts competitive market place and operating parameters of a Category 2 license (i.e. tax rate, limit on number of devices and type of devices).

One of Raynham/PR’s equity shareholders currently operates the largest casino in Philadelphia as measured by gross gaming revenue.  While significant components of this experience base were used to support the various plans contained in their submission, this is the only casino that Raynham/PR’s equity shareholder operates.

Presentation| Appendices

Leominster | PPE: SUFFICIENT

Applicant was effective in reaching agreements with host and surrounding communities. Strong support from public officials. Public opposition was registered at public hearings and throughout comment letters/emails.

Proposed site is located in close proximity to an underutilized interstate highway. Applicant identifies roadway and transit related mitigation to include: accommodating bike and pedestrians on Jungle Rd, providing new traffic signals, extending local bus lines and providing a shuttle to the commuter rail station. Comments received from MassDOT on proposed mitigation and access plans indicate that some refinements and additions to the program will be required. Potential review by FHWA was noted for recommended modifications to the interchange with I-190.

Applicant outlined their Responsible Gaming Plan from Maryland Live! facility. Applicant expressed support for strong Responsible Gaming Program and agreed to comply with any MGC regulations to be developed in this area.

Applicant executed an agreement with the MA State Lottery.

Plainville | SGR: VERY GOOD

Applicant was effective in reaching agreements with host and surrounding communities and created a model agreement that was used by other applicants. Host community referendum was passed by a wide margin; negligible opposition was registered at public hearings and through public comment/emails received by the MGC.

Proposed site is located close to a major interstate highway interchange. Applicant’s preferred site access improvements are currently under review with MassDOT and Federal Highway and alternatives are being considered. Applicant committed to implement mitigation in the form of offsite roadway improvements, in addition to those required for improved access to the site.

Applicant integrated responsible gaming practices into their casino and racing operations in many jurisdictions. Practices meet and exceed the American Gaming Association (AGA) reasonable code of conduct. Applicant agreed to comply with any MGC regulations to be developed.

Applicant executed an agreement with the MA State Lottery.

Raynham | RP: SUFFICIENT

Applicant was effective in reaching agreements with host, surrounding and nearby communities. Host community referendum was passed by a wide margin and negligible opposition was registered at public hearings and through public comment/emails received by the MGC.

Proposed site is located some distance from a highway interchange. Applicant identifies limited roadway and transit mitigation. Additional offsite intersection improvements may be required.

Applicant outlined responsible gaming policies and procedures at the Parx Casino in Pennsylvania. Applicant agreed to comply with any MGC regulations to be developed.

Applicant executed an agreement with the MA State Lottery.

Presentation | Report to Commissioners | Appendices 1 | Appendices 2

TOURISM RATINGS

Leominster | PPE: VERY GOOD

• MOUs with local partners
• Goals linked to regional economic development plan.
• Endorsements from other cities provided.
• History of financial support for community organizations and events
• Extensive entertainment experience.

Plainville | SGR: VERY GOOD

• MOUs with local partners
• Extensive past experience – marketing/loyalty programs, working with convention & visitors bureaus/tourism bodies
• Significant number of endorsement letters and references.
• Most likely avenue to maintain uninterrupted harness racing activity.
• Start new regional economic development organization.

Raynham | RP: SUFFICIENT

• Little detail/description on plans for:  cross-marketing, working with local organizations.
• Focus on sports partnerships.
• Entertainment and advertising budgets not  well explained or linked to proposed development.
• Potential for supporting harness racing operations at Brockton Fairgrounds.

SUPPORT FOR EXTERNAL BUSINESS

Leominster | PPE: VERY GOOD

• Details provided on outreach plans for contractors (sub trades), and suppliers during operations.
• Substantive MOU’s to demonstrate partnerships.
• M3D3 proposal – unique approach to business stimulation -guaranteed financial  commitment and Gateway City focus.

Plainville | SGR: VERY GOOD

• Broadest operational track record including detailed financial impacts.
• Detailed outreach plans for contractors (sub trades) and suppliers during operations.
• Maintenance of existing racing operation at Plainridge Racecourse.

Raynham | RP: SUFFICIENT

• Discussed modeling of Community Partners program used in Bensalem.
• Past experience shown, but lacking detail on detailed plans for Raynham
• Marketing and entertainment spending is insufficiently explained/backed-up.

JOB CREATION RATINGS

Leominster | PPE: VERY GOOD

• Stable payroll/FTE and employee counts over 5 year period.
• Demonstrated awareness of Mass situation and past experience in Maryland
• M3D3 proposal has potential for job creation outside the gaming/hospitality area.

Plainville | SGR: VERY GOOD

• Most realistic payroll and labor estimates.
• Demonstrated positive track record in union relationships.
• History of human resource management and job development.
• Maintains racing employment at Plainridge.

Raynham | RP: SUFFICIENT

• Payroll and employee estimates – believed to be aggressive.
• Unsupported projection of increased non-gaming payroll in year 3 and beyond.
• Referenced past experience but provided limited detail and linkages to their a Massachusetts facility.

Presentation | Appendices

Leominster | PPE: VERY GOOD

In the context of the relatively modest applicability of these questions to be Category 2 Applicants, the Cordish responses stood out, and earned the highest rating in 7 of the 8 questions to which the Applicants responded.

The applicant demonstrated a coherent sense of the Lowell to Worcester crescent as an economic unit, of the Leominster/Fitchburg/Gardner area and surroundings as a tourist area, and has reasonable aspirations to anchor regional economic development.  And in the final analysis, Leominster/PPE also was judged to be the most effective regional location for a gaming facility, on the theory that in the long run, the region is least likely to be served by the other Mass gaming facilities, the location will serve as a competitive buffer to a potential Southern New Hampshire facility, and there are very likely to be much stronger Region C Casino (Southern Mass) facilities to compete with Rhode Island and Connecticut.

Plainville | SGR: SUFFICIENT / SUFFICIENT +

The strength of the Plainville/SGR proposal is its commitment to maintaining the harness track, and the broad support for that track and the facility within neighboring communities and the harness industry. The applicant tried hard to establish a regional appeal with the “stop, shop, play” concept, a concept which the evaluation team found difficult to assess for the extent of its impact.

The Penn National Applicant did an acceptable job answering the questions, with few really distinctive features.

Raynham | RP: SUFFICIENT – / INSUFFICIENT

The Greenwood Racing/Carney proposal was often minimally responsive to the questions, and seemed to make little effort to tie the components of the application to these criteria.

The singular strength of the Raynham/PR proposal is the distinguished business record of Mr. Carney and the virtually unanimous and genuine support he has in Raynham and nearby communities. Most of the specific questions in this category were addressed with relatively little substance or imagination.