Towns neighboring New Bedford all express interest in compensation for casino impacts
Fairhaven, Dartmouth, Acushnet, Freetown, others could seek money for increased traffic, class sizes, use of public services, and more, if negotiations unfold with New Bedford developer
NEW BEDFORD — The use of casino dollars for costs associated with upgrading the Howland Road bridge from Fairhaven into New Bedford, where the road becomes Coggeshall Street, is one of many topics that could be on the table in coming weeks, as SouthCoast towns consider potential impacts from the $650 million casino project proposed for New Bedford’s waterfront.
“We’re just at the starting point of having discussions with surrounding towns,” Fairhaven executive secretary Jeffrey Osuch said Thursday. “There will be issues ranging from traffic concerns to housing concerns to potential addiction concerns.”
Less than a month after New Bedford residents gave a landslide show of support for a waterfront casino — with 73 percent of voters in favor June 23 — Fairhaven, Dartmouth, Acushnet and Freetown are all exploring potential casino impacts in their communities and, in varying degrees, the potential for financial compensation.
“Several of the towns have contacted us and asked us to weigh in on the impacts,” said Steve Smith, who served as executive director of the Southeastern Regional Planning and Economic Development District, or SRPEDD, for more than 30 years before retiring June 30.
Smith, who was in the office Wednesday in his new capacity as a part-time consultant, said SRPEDD has previously evaluated impacts for communities near other Massachusetts casino proposals.
“We played that role in the case of the Raynham application,” Smith said, referring to the Taunton-area town’s unsuccessful application for the state’s single slots parlor license.
SRPEDD also was involved in the slots process, Smith said, by sitting in on meetings between developer Penn National Gaming and communities near Plainville, which won the state's single slots license. Plainridge Park Casino opened June 24.
A similar pre-licensing process now is unfolding in SouthCoast.
“I’ve had both Acushnet and Freetown reach out to me for assistance,” Smith said. He added that SRPEDD staff had heard from Dartmouth and Fairhaven officials, as well.
New York-based developer KG Urban Enterprises and New Bedford are competing with developer Mass Gaming & Entertainment, which is proposing a $650 million casino project on a Brockton Fairgrounds site, for the sole commercial casino license the Massachusetts Gaming Commission can allocate in southeastern Massachusetts.
Smith said whether to involve SRPEDD in the mitigation process for communities near New Bedford is up to KG Urban. State gaming law allows regional planning authorities to facilitate impact assessments for casino agreements.
“So far, there’s been no contact in that regard,” Smith said Wednesday.
Osuch said Thursday that KG Urban had not yet contacted Fairhaven, either. Dartmouth Town Administrator David Cressman said the same.
But Cressman said Gaming Commission representatives had reached out to town officials recently, to make them aware of surrounding community rights under state law.
KG Urban spokesman Andrew Paven commented briefly last week on surrounding community negotiations, saying he didn't think the developer had yet reached out to towns neighboring New Bedford. Those talks could heat up ahead of the Sept. 30 deadline for submitting final application materials to the Gaming Commission.
KG Urban’s negotiations with New Bedford early this year were conducted in a contentious, late-winter flurry aided by deadline extensions from the Gaming Commission. The talks culminated in an 11th-hour host community agreement signed on the morning of March 19, hours before Mayor Jon Mitchell and KG Urban representatives presented the deal at a commission meeting later that day.
The timeline for the next legal front, surrounding community negotiations, became clearer at a Thursday meeting of the Gaming Commission in Boston.
If surrounding community agreements for towns that want to be involved are not included in KG Urban’s final application Sept. 30, those towns would have a window in early October to petition to the Gaming Commission.
The five-member commission then could rule by Nov. 30 on whether those towns would be granted “surrounding community” status. That would then trigger a 30-day negotiation period, through December, in which towns granted that status could negotiate compensation agreements with KG Urban.
“The amount of money they get paid is going to be right at the top of the list,” Smith said, saying traffic, housing, schools and crime also are common issues in surrounding community negotiations.
If towns don’t reach agreements, arbitration could result in January 2016 decisions. Attorney Jonathan Silverstein of Boston-based firm Kopelman & Paige, who represents New Bedford in casino matters, said last week that it would be “baseball-style” arbitration, in which each side makes a best and final offer and an arbitrator chooses one of the two.
Silverstein has represented host and surrounding casino communities across Massachusetts. He’ll represent Acushnet, as well, and is representing several communities surrounding Brockton’s casino proposal: Holbrook, Stoughton and Abington so far.
“Every case is going to be very different,” Silverstein said.
Cities and towns near casino proposals elsewhere in Massachusetts — successful and not — have sought compensation in recent years for an array of impacts, as the commonwealth’s casino era begins.
The most prominent disputes are unfolding in Boston, where Wynn Resorts’ $1.75 billion Everett casino is facing ongoing litigation on numerous fronts, including emphatic efforts by the City of Boston to revoke the casino’s license, or to be named a host community for the project.
Less-contentious casino deals elsewhere in the state, though, could provide a clearer picture of the kind of negotiations that could lie ahead for SouthCoast towns.
West Springfield, for example, received — via arbitration — a May 2014 agreement that includes a $665,000 up-front payment from MGM Springfield. The payment is expressly for design and permitting costs for the reconstruction of Memorial Avenue in West Springfield. The avenue is a major transportation route to the future MGM Springfield casino.
Silverstein represented West Springfield in its negotiations with MGM. A total of six towns and two cities in the Springfield area reached agreements with the developer. Longmeadow won arbitration, as well, receiving $850,000 up front and 13 annual payments of $275,000 in the April 2014 agreement.
West Springfield’s agreement also includes annual payments, of at least $425,000 a year. At least $50,000 of those payments, annually, will go toward “look-back studies,” which will assess casino impacts and potential talking points for additional compensation in future years.
Funding for such studies is included in many casino agreements across the state, as cities and towns enter the foreign territory of commercial gaming.
“This is new to all of us,” Osuch said.
MGM Springfield is an $800 million project, compared to the $650 million estimate for KG Urban’s Cannon Street Station in New Bedford. West Springfield also has nearly double the population of Fairhaven, and is larger than any town surrounding New Bedford.
But its location across the water from Springfield could create traffic impacts and other concerns comparable to Fairhaven’s, Smith said.
“On the surface, it would seem to be fairly close,” Smith said.
Fairhaven selectmen agreed unanimously Monday to direct town counsel to reach out to surrounding towns and to SRPEDD, to discuss casino impacts. The city also intends to file notices with KG Urban and the state Gaming Commission, Osuch said, indicating the town wishes to receive “surrounding community” status that can lead to compensation.
Fairhaven Town Counsel Thomas Crotty said Monday that he would reach out to Kopelman & Paige for potential representation, meaning Silverstein could wind up negotiating casino deals for most of greater New Bedford.
Osuch said data such as traffic thresholds on Fairhaven intersections and roads, including Howland and the Coggeshall bridge, could be analyzed for potential needs such as signal upgrades, turning lanes and more.
“We don’t have a full understanding of what the actual impacts are, and that’s what we have to do some homework on,” he said.
Smith said assessing regional traffic impacts from a New Bedford casino could be easier than assessing multi-direction impacts in Raynham and Plainville, because here, "there just aren't that many ways to access the site.”
Route 6 would be a major secondary access route, he said, but those renovations — including to the New Bedford-Fairhaven Bridge — would involve the state and largely be outside the purview of a surrounding community agreement.
“It’s not going to be Fairhaven’s ability to fix that bridge,” Smith said. “Fairhaven could certainly make the request, you know, ‘Do something to try to get the state moving on that project,' but it’s really sort of beyond the local jurisdiction.”
Silverstein said monetizing traffic impacts can be difficult, and vary by situation.
"It’s a bit of an art, as opposed to a science,” he said.
Public services in New Bedford interact significantly with services in neighboring towns, meaning an influx of casino crowds into the city could have affects on outlying areas.
“We’re looking at a 15 percent increase in people who are in the city at any one time,” New Bedford Fire Chief Michael Gomes said, citing potential casino crowds of 12,000 to 15,000 people per day. “If you have people who are transiting from other communities to get here, there certainly is increased risk for services from those communities.
“The risks of auto accidents, medical calls and things of that nature will certainly go up,” he said.
Gomes said about 15 percent of emergency medical service (EMS) calls in New Bedford involve some form of mutual aid, either from private ambulance agencies or surrounding towns.
“I do believe that Acushnet comes into the city about 10 times a month, on average, for ambulance support,” he said.
Mark McGraw, the city’s EMS director, said city dispatchers call for ambulance support from surrounding towns after all four of its private contractors are unavailable.
“Mutual aid is a funny thing,” he said. “Sometimes, within a matter of half an hour, we’ve got everybody and his brother in the city,” while other days are slow.
McGraw said the department has looked at studies from other casino towns to gauge impacts. Other communities saw more traffic accidents, McGraw said, but didn’t see much of an increase on the medical side.
“I don’t think it was all that significant,” McGraw said, referring to overall casino impacts on emergency services in other communities.
Ron Labelle, commissioner of the city’s Department of Public Infrastructure, said there’s room for the city to grow in water and wastewater capacity, including in its services to surrounding towns.
A report provided by KG Urban in 2014 estimated that a waterfront casino could use 100,000 to 200,000 gallons of water per day.
Labelle called that amount negligible to city water treatment, which he said is operating only at about half capacity.
The city’s water treatment plant has the ability to produce 45 million gallons of water a day, Labelle said, but is only treating about 18 million gallons a day in high-demand summer months.
“We have tremendous capacity to provide water and wastewater services, so a couple hundred thousand gallons of water is minimal,” he said. “It’s really not that much.”
Labelle said a casino “wouldn’t adversely affect our ability to provide any services to (surrounding towns), water or wastewater.”
The shared services are substantial.
“Dartmouth buys a lot of water from us in the summertime, because their wells can’t handle the summer demand,” he said. “Acushnet buys all of its water from us.”
New Bedford provides Fairhaven with water on an emergency basis, according to Labelle, while the city takes in sewage from Acushnet, Dartmouth and Freetown.
New Bedford sends some of its sewage to Fairhaven, he added.
Osuch and Cressman said Fairhaven and Dartmouth, respectively, are just beginning to assess potential casino impacts and compensation.
“We’re in the initial stages, we’re starting to look at what other communities have looked at and done,” Cressman said.
Silverstein said he’s seen a variety of situations.
“I’ve negotiated some surrounding community agreements fairly quickly, and others have taken a longer time,” he said.
Silverstein said the time period facing communities surrounding New Bedford should be workable.
“Would I love to have more time? Sure,” Silverstein said. “(But) it certainly isn’t all that unusual.”