Walsh, Mohegan ink casino deal

Mayor refuses to go to arbitration with Wynn

Mayor Marty Walsh, casting himself as a reluctant negotiator in the state’s casino sweepstakes, signed an agreement on Thursday with Mohegan Sun that would guarantee Boston at least $18 million in mitigation payments if the company is awarded a license to open a casino on the Revere portion of the Suffolk Downs racetrack property.

Word of a pending agreement was reported earlier this week.

But Walsh threw a new curve into the casino process by announcing that Boston was not meeting today’s deadline to submit a surrounding community mitigation proposal for the Wynn Resorts casino in Everett. Mohegan Sun and Wynn are vying for the one Greater Boston casino license that will be awarded. The state gaming commission had given the city and Wynn a July 10 deadline to exchange mitigation proposals after the two sides were unable to reach a negotiated agreement. An arbitrator or panel of arbitrators would then have ruled in favor of one of the proposals. But Walsh said the city would instead exercise an option in state casino regulations that allows a host community to hand the decision to the gaming commission to determine any mitigation package.

The deal with Mohegan includes, in addition to the $18 million in guaranteed annual payments, $30 million for capital projects. Mitchell Etess, the CEO of Mohegan, in a briefing with reporters outside City Hall after the deal was signed, called the agreement “another example of the Mohegan Sun way, the way we work with a community. We’re good neighbors.”

Walsh, in a separate briefing, said Mohegan was a good negotiating partner and declared it “a good agreement for the people of East Boston.” But he made it clear that he had not wanted to be at the bargaining table at all at this point. Walsh had pushed for Boston to be considered a host community, not simply a surrounding community, a designation that would have given East Boston residents veto power over the casino plan through a neighborhood-wide vote.

The state gambling commission rejected Walsh’s call, and he threatened to take his case to court. In the end, the mayor blinked, worried that the city could lose a court challenge and wind up with no mitigation payments. He also asked the gambling commission to put the entire casino licensing process on hold until after the outcome of November’s ballot question that could repeal the entire casino law. The commission rejected that as well.

“It’s unfortunate that we’re in this situation,” Walsh said. “The gaming commission forced our hand and tied our hands every step of the way.”

Walsh said a separate agreement was struck with Suffolk Downs that would guarantee the continued operation of the horse racetrack for at least the 15-year life of an initial casino license to Mohegan.

Walsh added a new surprise wrinkle to a process that has seen lots of unexpected twists by disclosing that the city refused to submit a proposal for mitigation as a surrounding community to the Wynn casino planned for Everett. He said there were too many unanswered questions about the proposal for the city to make an assessment of the casino impacts in need of mitigation.

“So far it’s been a no-win situation for us in dealing with the Wynn folks,” Walsh said. He said the city has yet to receive an environmental impact study on the development, and, he said, “we don’t know even know what the land deal is.”

The casino regulations do allow a surrounding community to refuse to take part in the arbitration process. The regulations say the commission may then either determine the mitigation package to be paid or declare that the municipality has “waived its designation as a surrounding community.”

The commission, which received a letter from the city late Wednesday saying Boston would not take part in arbitration, doesn’t seem eager to exercise either option. Instead, a commission spokesman urged the two sides to return to negotiations.

“The Commission regrets the City of Boston’s decision not to proceed with arbitration,” Elaine Driscoll, the commission’s communications director, said in a statement released on Thursday night. “However, the Commission has always said that a negotiated agreement is the best course of action and therefore hopes that the parties will continue to negotiate. Failing that, the Commission has a number of alternatives and will expeditiously consider which of them to follow.”

For its part, Wynn said it complied with the submission deadline.

“We have submitted our best and final offer in accordance with the Commission’s guidelines,” Michael Weaver, a senior vice president with Wynn, said in a statement. “We understand that Boston refuses to participate in the arbitration and the regulations address this situation. We will await the Commission’s determination on how they wish to proceed.”

Wynn officials contested Walsh’s claims about unanswered questions, saying the company submitted its final environmental impact report to the state and city last week. The company also claims details of its land agreement are available on the state gambling commission website.

Meet the Author

Michael Jonas

Executive Editor, CommonWealth

About Michael Jonas

Michael Jonas has worked in journalism in Massachusetts since the early 1980s. Before joining the CommonWealth staff in early 2001, he was a contributing writer for the magazine for two years. His cover story in CommonWealth's Fall 1999 issue on Boston youth outreach workers was selected for a PASS (Prevention for a Safer Society) Award from the National Council on Crime and Delinquency.

Michael got his start in journalism at the Dorchester Community News, a community newspaper serving Boston's largest neighborhood, where he covered a range of urban issues. Since the late 1980s, he has been a regular contributor to the Boston Globe. For 15 years he wrote a weekly column on local politics for the Boston Sunday Globe's City Weekly section.

Michael has also worked in broadcast journalism. In 1989, he was a co-producer for "The AIDS Quarterly," a national PBS series produced by WGBH-TV in Boston, and in the early 1990s, he worked as a producer for "Our Times," a weekly magazine program on WHDH-TV (Ch. 7) in Boston.

Michael lives in Dorchester with his wife and their two daughters.

About Michael Jonas

Michael Jonas has worked in journalism in Massachusetts since the early 1980s. Before joining the CommonWealth staff in early 2001, he was a contributing writer for the magazine for two years. His cover story in CommonWealth's Fall 1999 issue on Boston youth outreach workers was selected for a PASS (Prevention for a Safer Society) Award from the National Council on Crime and Delinquency.

Michael got his start in journalism at the Dorchester Community News, a community newspaper serving Boston's largest neighborhood, where he covered a range of urban issues. Since the late 1980s, he has been a regular contributor to the Boston Globe. For 15 years he wrote a weekly column on local politics for the Boston Sunday Globe's City Weekly section.

Michael has also worked in broadcast journalism. In 1989, he was a co-producer for "The AIDS Quarterly," a national PBS series produced by WGBH-TV in Boston, and in the early 1990s, he worked as a producer for "Our Times," a weekly magazine program on WHDH-TV (Ch. 7) in Boston.

Michael lives in Dorchester with his wife and their two daughters.

Walsh, who supported casinos as a state representative before he was elected mayor last fall, said he was not sure whether he’ll take a stand on the ballot question seeking repeal of the casino law. “I voted for the casino legislation on Beacon Hill, but I haven’t decided if I’m going to take a public position on the ballot question,” he said. “I’m not sure if I need to take or if I should take a position in suggesting to people how they vote right now.”

East Boston voters soundly rejected a casino proposal last fall. Mohegan then rejiggered its proposal so that a casino would sit entirely on the Revere side of the Suffolk Downs property, which straddles the Revere-East Boston border. “It was everyone’s belief, including my understanding on election night, that the proposal in East Boston and Revere was over,” said Walsh.