Town makes deal with MGM
Date: 12/19/2013
By Chris Maza
chrism@thereminder.comEAST LONGMEADOW – The Board of Selectmen came to terms on a surrounding community agreement with MGM Springfield at its Dec. 11 meeting.
“It’s essentially the same agreement signed by Wilbraham and Ludlow,” Board of Selectmen Chair Paul Federici said.
Under the agreement, upon the opening of the downtown Springfield gaming complex, the town would receive $100,000 annually for 15 years. Of that total, $75,000 would be for the mitigation of negative impacts of the casino, while $25,000 would be utilized to pay for consultants and any legal expenses.
The contract also calls for “look backs” in years one and five to be conducted by third party consultants chosen and paid for by MGM to calculate any costs related to casino mitigation incurred by the town that are in excess of the $75,000.
If it is discovered that the town’s casino-related expenses were more than the annual payment from MGM, the town could then attempt to acquire additional reimbursement from a state fund set up in accordance with the gaming legislation.
Federici said in accepting the agreement, the town was ensuring it received something in the way of mitigation consideration instead of running the risk of getting nothing.
“People are going to wonder if we sold ourselves short,” he said. “What we found out is that we are really a fringe impact community and if we decided to go to arbitration, we could get nothing for the town.”
Among the major factors that led to the decision to accept MGM’s proposal was the outcome of MGM’s traffic study, as well as the review done by Greenman-Pedersen Inc. (GPI) at the direction of the Pioneer Valley Planning Commission.
“The one thing everybody talks about is traffic and one of the studies showed a 5.6 percent increase and the other a 6 percent increase, neither of which is material in terms of what the casino would be considered responsible for,” Federici said.
GPI’s presentation took place on Dec. 10, a day prior to the board signing the agreement. Federici admitted that had there been a significant difference between MGM’s traffic numbers and those of GPI, the board most likely would have explored further negotiations.
“We had the benefit of having the information in hand when we made this decision,” he said. “If [GPI’s] data had come through with a 20 percent increase, certainly we would have approached this differently.”
Addressing the “look back” element of the agreement, Federici said the studies conducted by Michael Albano & Associates would be valuable tools in measuring the actual impacts of the casino project.
“Mr. Albano’s proposal gives us a benchmark for things MGM might not even consider material right now,” he said. “If we see significant changes in the data we collect in the coming years versus what we have from Mr. Albano, we will be able to take that to MGM during the ‘look back’ discussions.”
