Questions arise over Springfield casino consultant
August 31, 2012
BOSTON—The gambling consultant hired to help Springfield assess four casino proposals is the registered lobbyist in Illinois for two of the companies competing in Springfield, raising questions about the fairness of the process.
Illinois state records show that Shefsky & Froelich is the registered lobbyist of MGM Resorts International and Penn National Gaming , two companies seeking casino development rights in Springfield.
An official with another company vying to build a casino in Springfield tells The Boston Globe he's "concerned" about the relationship.
Springfield officials as well as Shefsky & Froelich Chairman Cezar Froelich said the process is transparent and the team advising Springfield will have no interaction with its employees working for MGM and Penn in Illinois
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Information from: The Boston Globe, http://www.boston.com/globe
http://www.boston.com/news/local/massachusetts/articles/2012/08/31/questions_arise_over_springfield_casino_consultant/?rss_id=Boston.com+--+Local+news
Springfield casino consultant a lobbyist for MGM, Penn National Gaming
08/30/2012
The gambling expert hired to help Springfield assess as many as four casino proposals is the registered lobbyist in Illinois for two of the firms competing in Springfield, raising questions about a potential conflict in the high-stakes competition.
Springfield Mayor Domenic Sarno on Monday outlined the city’s strategy for evaluating the competing casino projects, relying in large part on advice from the Chicago law firm of Shefsky & Froelich, which the city hired in July as a consultant on gambling issues.
Illinois state records show that Shefsky & Froelich is the registered lobbyist of MGM Resorts International and Penn National Gaming, two gambling giants seeking casino development rights in Springfield.
MGM last week unveiled plans for an $800 million casino and entertainment emporium in Springfield’s South End. Penn National had confirmed it intends to build in the North End, on land where the Republican newspaper and the Peter Pan bus terminal currently stand.
Two other casino companies are also preparing bids in Springfield — Ameristar, which owns land east of downtown, and Hard Rock International, which has not yet announced a site but has been working to land a downtown location.
Only one resort casino will be licensed in Western Massachusetts.
“We’re obviously very concerned,” said Troy Stremming, a senior vice president for Ameristar, when asked about the relationships between the city’s consultant and two of his competitors. “We would hope the advice to the mayor and the city would be unbiased and would come from an organization without any connections to any applicant.” He questioned “how someone could be independent if they are the current lobbyist for another applicant.”
Stremming said he was unaware of any public announcement in Springfield that the consultant currently works for MGM and Penn National in Illinois. A spokesperson for Hard Rock could not be reached.
The Sarno administration, in response, said the consultant disclosed its relationships in bid documents, which are public records on file with the city, and in interviews with city officials.
Springfield City Solicitor Edward M. Pikula said the Shefsky & Froelich team advising Springfield will have no interaction with its employees working for MGM and Penn in Illinois.
“We discussed ‘walling off’ any of the firm’s employees handling those matters from being involved with the scope of services provided under the contract with the city, and the consultant agreed to do so,” said Pikula, by email. “The city is confident that the advice it receives from its consultant will be unbiased and is confident that the public credibility of the process will not be undermined by these relationships.”
Shefsky & Froelich has vast experience in the casino business, representing a number of other gambling firms in Illinois as well as companies in other industries, according to state lobbying records. Shefsky & Froelich is familiar with Massachusetts, having advised the City of Taunton in negotiations with the Mashpee Wampanoag over plans for a tribal casino in that community. It has consulted on gambling issues for the states of Colorado, Michigan, Illinois and Ohio, according to Sarno’s office.
Shefsky & Froelich has listed MGM as a lobbying client in Illinois every year since 2001; the firm has listed Penn National as a client each year since 2003.
The firm’s chairman, Cezar Froelich, downplayed his company’s ongoing service to MGM and Penn, as “standard legal regulatory work that’s not a huge amount of dollars.”
“We don’t see it as a conflict,” Froelich said in a telephone interview from Illinois. “The fellow who does that work is walled off from us, which we represented to the city.” He said his firm “has never talked to Penn or MGM or any other company about any of the activities in Massachusetts, either formally or informally.”
“Our work is 100 percent transparent — everybody will see what is going on, and the final decision-maker is not me; the final decision-makers are the mayor and the city council.”
Froelich, who has represented his company at public events in Springfield, acknowledged that he personally represented MGM and Penn, as well as others, in the early 2000s in the pursuit of a casino license in Illinois.
“The only way you become an expert in the business is to do a lot of work for a lot of different people,” Froelich said. “We’ve had the same questions asked in Illinois because we represent two cities here and in those cases we simply advised the cities that we represent a tremendous amount of clients in the business: manufacturers, investment companies, etc. And in each case the city has said, ‘No problem. That’s what we want. We want an expert.’ ”
Mark Arsenault can be reached at marsenault@globe.com. Follow him on Twitter @bostonglobemark
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