Q+A regarding determination that City of Boston has waived its Surrounding Community status regarding Wynn MA, LLC proposal

1. What action did the Massachusetts Gaming Commission (“Commission”) take on August 7, 2014 regarding the City of Boston’s status as a surrounding community relative to the Wynn MA, LLC proposal?

The Commission determined that the City of Boston (“City”) had waived its designation as a surrounding community by refusing to participate in the surrounding community arbitration process the Commission’s regulations require. The City was aware of the regulation, 205 CMR 125.01(6)(a)(2), and in fact cited it in the letter notifying the Commission that it was not going to participate.

2.     Does the decision mean that the City of Boston will not receive any mitigation payments from Wynn MA, LLC (“Wynn”) or other mitigation if Wynn is selected?

No.   The Commission has stated that it will impose conditions on any license it awards Wynn, including conditions that require Wynn to mitigate impacts through payment of money or taking other actions or both.  Further, Boston can still negotiate an agreement with Wynn to mitigate impacts.  Also, Boston is not precluded from applying to the Community Mitigation Fund for assistance to pay for impact remediation.

3.     Does this decision impact the Commission’s prior decision to determine what conditions it should place on Wynn regarding a community impact fee and any requirements it deems appropriate for mitigation of Boston impacts from the development or operation of the Wynn license if Wynn is chosen to receive a license by the Commission?

No.   The Commission is actively working to determine what conditions it may place on the Wynn License in the event Wynn receives a gaming license and will continue to do so.

4.     Can the City of Boston still negotiate an agreement with Wynn regarding mitigation?

Yes.   Such an agreement could be reached either before or after the Commission makes a decision on which applicant will receive the Region A gaming license, if Wynn is chosen to receive a license by the Commission.   The City and Wynn also could potentially make a joint recommendation regarding conditions the Commission could place on the license.

5.     How are the conditions the Commission may place on a Wynn license, if selected, different from an agreement that could be reached between Wynn and the City?

Because respect for local control and home rule are central to the Gaming Act, communities and applicants have had significant flexibility in reaching surrounding community agreements to address concerns about the development or operation of a gaming facility.   In contrast, when mandating a condition on a licensee in the absence of such an agreement, the Commission has less flexibility in determining the nexus between an impact and the measure to mitigate such impact.  In other words, the City has an opportunity to achieve more City goals through negotiation than the Commission can impose through license conditions.

6.     Does the waiver of surrounding community status now preclude the City from applying to the Community Mitigation Fund?

No.  Although the regulations and administrative details regarding the Community Mitigation Fund have not yet been developed, the Gaming Act allows the Commission to expend funds to assist any community in the vicinity of a gaming establishment to offset costs related to the construction and operation of a gaming establishment.   The Commission’s current regulation, 205 CMR 125.01(4), states that “[a]ny finding by the commission that a community is not a surrounding community for purposes of the RFA-2 application shall not preclude the community from applying to and receiving funds from the Community Mitigation Fund established by M.G.L. c. 23K, §61, the Transportation Infrastructure and Development Fund established by M.G.L. c.23K, §62 and the Public Health Trust Fund established by M.G.L. c. 23K, § 59.”

7. Why did the Commission take yesterday’s action?

 A full explanation can be found in the Counsel Memorandum found in the August 7, 2014 Commissioners packet (see page 81) (http://massgaming.com/wp-content/uploads/Commissioners-Packet-8-7-14.pdf) .   In essence, the Gaming Act says that applicants can only proceed with their license applications if they have agreements with cities and towns that have been designated as “surrounding communities”. In order to prevent a surrounding community from effectively vetoing an applicant’s proposal by simply refusing to enter a surrounding community agreement, however, the law also required the Commission to create “protocols and procedures” for use when an applicant and a surrounding community do not reach an agreement on their own. The protocol and procedure created by the Commission is contained in a regulation requiring arbitration or waiver of surrounding community status. The City was aware of the regulation and mentioned it in the letter informing the Commission that it refused to arbitrate. Accordingly and as the regulation provides, the Commission deemed the City’s refusal to arbitrate as an election to waive its status as a designated “surrounding community.”

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