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Longmeadow, MGM exchange best, final offers

Date: 4/3/2014

By Chris Maza

LONGMEADOW – As the two sides enter arbitration, the town of Longmeadow and MGM exchanged their best and final offers for a surrounding community agreement, but remained far apart.

Longmeadow’s submitted a proposal with a value of $4.4 million, according to Town Manager Stephen Crane, which is roughly half of its initial request. MGM’s proposal consisted of two options – a traffic improvement plan partially funded by the gaming company or a “look-back” approach similar to the ones agreed to by other local municipalities – neither of which presented close to the dollar value the town seeks.

The two will present their cases before a three-person panel of arbiters, with a deadline of April 24 to determine the most reasonable set of protocols for mitigation of negative impacts on Longmeadow as a direct result of a resort casino in Springfield’s South End.

Crane indicated that with the reduced asking price, the town was attempting to show its eagerness to get a deal done while still addressing needs identified by the town and confirmed by the Massachusetts Gaming Commission (MGC) at its Jan. 28 surrounding community hearing.

“In a demonstration of good faith to reach a mutual agreement, Longmeadow offered to absorb almost half of MGM’s share of the mitigation costs that were justified in the previous offer and affirmed by the Gaming Commission. It is disappointing that while the town tried to bridge the gap, MGM decided to go in the opposite direction.” Crane said, “Longmeadow’s best and final offer is a reasonable compromise.”

Longmeadow’s offer, calling for $850,000 in up-front payments and 13 annual payments of $275,000 once the casino opens its doors to “offset a small percentage of the traffic improvements and monitoring needed,” and to fund additional public safety efforts due to expected increases in drunk driving activity in the community, according to a press release from the town.

The town’s current offer calls for approximately $4 million less than to its initial counter offer made in December 2013 that requested roughly $8.5 million, including $1.1 million in up-front money, and $500,000 in annual payments with a 2.5 percent annual increase.

The current proposal also calls for “look backs” and the option for the town to reopen negotiations.

MGM’s two-pronged proposal offers a maximum value of $1.6 million.

“With six signed surrounding community agreements, the MGM Springfield team feels good that our data-driven process has been fair, balanced and responsive to all parties. We have worked hard to reach similarly fair agreements with two additional communities, Longmeadow and West Springfield. But despite our best efforts in these two cases, we were not able to reach agreement. We will now rely on an arbiter’s resolution, so we can move on in the licensing process,” Carole Brennan, MGM spokesman, said in a statement to the media.

The first option stipulates the town would receive up-front payments of $100,000 for legal and consulting fees and $100,000 to be used to offset the cost of necessary traffic improvements, such as signal equipment and retiming. Through a “look back,” the town could receive up to an additional $600,000 in order to mitigate other negative impacts identified by a traffic consultant.

The other option offers the town $100,000 in up-front payments, $75,000 in annual mitigation payments and a total of $375,000 to be disbursed according to a schedule outlined in the agreement to offset the cost of one- and five-year “look backs.”

MGM’s first offer to Longmeadow was of a similar structure to the second option, with the town receiving $50,000 up front to offset legal and consultant fees, plus an annual $75,000 annual mitigation payment, plus $25,000 annually for “look back” study expenses.

Its latest offer prior to the best and final proposal, Select Board Chair Marie Angelides said at a recent meeting, MGM presented an agreement through which the town would receive a maximum of $700,000 for traffic mitigation for the intersections of Route 5 and Forest Glen Road and Route 5 and Converse Street, as well as consulting and legal fees.

The arbitration process will proceed through April 16. After that date, the panel will file a report with the MGC and the towns outlining the terms of a surrounding community agreement. Based on those recommendations, the two sides must sign a surrounding community agreement by April 24 or the MGC will determine the report to be the binding agreement.

The MGC has set a deadline of May 30 to award resort casino licenses.