Herald: Gaming Commission meets behind close doors regularly
The Boston Herald reports the Massachusetts Gaming Commission has spent more than 100 hours in meetings that were kept from the public. "A Herald review of more than 1,000 pages of the commissioners' individual public calendars dating back to 2012 uncovered questionable ways the commission has been able to meet in full, despite the strict requirements of the state's Open Meeting Law preventing 'deliberation' in private," writes Chris Cassidy of the Boston Herald. Some of that time is spent at weekly "commissioners' lunches" where no records are kept on the topics.http://bit.ly/1RfHS2g

Gaming Commission playing games with open meeting rules

Photo by: 

Ted Fitzgerald

PRIVATE EYES: Gaming commissioner Bruce Stebbins had a calendar entry suggesting some ‘deliberation’ was done in private.

Monday, July 6, 2015

By:

Chris Cassidy

The state’s Gaming Commission has spent more than 100 hours in secret meetings that were off-limits to the public — including “agenda-planning” sessions, weekly “commissioners’ lunches,” and at least one 90-minute conference with the gambling industry’s former top lobbyist, a Herald record review found.

A Herald review of more than 1,000 pages of the commissioners’ individual public calendars dating back to 2012 uncovered questionable ways the commission has been able to meet in full, despite the strict requirements of the state’s Open Meeting Law preventing “deliberation” in private.

Weekly “commissioners’ lunches” inside the body’s downtown Boston office — lasting between one and two hours — began in July 2013 and are still held each Wednesday. No records are kept on the topics, and the lunches are closed to the public, according to spokeswoman Elaine Driscoll.

“Commissioners discuss social matters, organizational structure and morale,” Driscoll said. “The commissioners do not discuss any matter that constitutes public business within the jurisdiction of the commission.”

But former Inspector General Greg Sullivan of the Pioneer Institute said he found that hard to believe.

“You can only talk about Tom Brady and ‘Deflategate’ for so long,” Sullivan told the Herald. “Eventually, the conversation probably drifts around to the subject of Massachusetts gaming.”

At least one commissioners’ lunch even featured a special guest — Frank Fahrenkopf, who had stepped down as president of the American Gaming Association one year before he met for 90 minutes with the MGC on Oct. 22, 2014.

Asked why that meeting had to be conducted in private, Driscoll said it was a “training session,” which is allowed under the Open Meeting Law, “to provide his perspective ... on the overall international status of the gaming and racing industry.”

The MGC also holds private “agenda-planning meetings” for up to two hours every other Wednesday.

They often immediately follow the lunches, putting the commission in combined private meetings together for nearly four hours at a time.

Driscoll said commissioners don’t deliberate during the “agenda-planning meetings,” which are also attended by director-level staffers, but “discuss the upcoming public meeting agenda” and materials needed for commissioners’ packets before the public meeting the following week.

Driscoll provided the Herald with a sample “draft agenda” and a “to-do list” that helps staff compile the agenda.

While the commission insists deliberations are conducted and decisions are made only in public meetings, Commissioner Bruce Stebbins had a one-hour entry on his calendar on Sept. 17, 2014 — the day after the Commission awarded a casino license to Wynn Resorts — with the subject line “Conference Call — MGC.”

“I was hoping we could strategize and discuss some critical topics in light of yesterday’s license decision,” Stebbins’ entry stated.

Driscoll told the Herald: “Commissioner Stebbins cannot recall if that conference call actually happened.”

She said “his intent was to have an agenda-setting conversation” with staff and “possibly” Commissioner Gayle Cameron about the future of racing and the employees at losing bidder Suffolk Downs.

The MGC also held a few “commissioner dinners” in late 2012 and early 2013, the calendars show.

Sullivan told the Herald the Gaming Commission’s structure — where the commissioners all work out of the same office — is a problem.

“It’s vulnerable to violations of the Open Meeting Law because of the design of the agency and the decisions the Legislature made,” said Sullivan. “It’s an inherently problematic situation because of the extremely unusual arrangement whereby the commissioners are full-time employees that work in the same building.”

Some of the datebook information the Herald requested could not be produced.

Stebbins’ calendar from March 2012 through the end of 2013 was “unavailable due to technical issues caused by his BlackBerry,” the MGC told the Herald.

Driscoll insisted the commission has acted within the law and has held 156 public meetings since 2012 — all of which require prep work.

“The commissioners never discuss or deliberate on any matter of public business which is, has or could be before the commission,” Driscoll said.

http://www.bostonherald.com/news_opinion/local_coverage/2015/07/gaming_commission_playing_games_with_open_meeting_rules

Everett: Something wicked this way comes......

First...there's a convicted felon.....where was the GAMBLING COMMISSION?

MBTA land sale could sink Steve Wynn’s Everett plan

By Joan Vennochi
GLOBE COLUMNIST APRIL 07, 2015

CALLING OUT the MBTA for rushing the sale of a sliver of land to gambling mogul Steve Wynn may not sound like much. But it could lead to the unraveling of Wynn’s plan to build a casino in Everett. Pull that thread, and the entire project starts to come undone.

In March, Wynn Resorts said it had finalized the purchase of 1.75 acres from the T in Everett for $6 million. The land was described as Wynn’s “preferred” entrance to the $1.6 billion gambling resort he was granted a license to build by the state gambling commission. To be blunt, Wynn preferred that entrance because he wanted a front door to the casino that wasn’t in Boston. As long as Wynn had a non-Boston route onto the Everett property, he would not have to treat Boston as a host community. By avoiding that stipulation, he avoided the financial obligations that go with it. He also wouldn’t have to face a local Charlestown referendum that would then become part of the process, since most of the casino traffic would go through Sullivan Square.

There was only one way for Wynn to accomplish his mission — by buying a specific piece of MBTA-owned land. And so he did, with help from politically wired lobbyists and consultants, and without public debate.

But last week, a top regulator in the administration of Governor Charlie Baker said the MBTA sold the land before the appropriate state office conducted a review of traffic and other environmental issues — a violation of state law. As a result, the Baker administration is refusing to issue a crucial permit that Wynn Resorts needs to move forward with its casino plans.

Wynn representatives say it’s a technical matter that will delay construction, but ultimately be resolved.

Don’t be so sure. The entire MBTA land transfer is under scrutiny by assorted state agencies and other authorities. The cities of Boston, Revere, and Somerville have also filed lawsuits against the gambling commission. The Boston action specifically raises questions about the land deal.

The lack of appropriate environmental review is only one concern. A separate issue is whether the sale of the MBTA land violated the T’s own procurement requirements. Another is whether the land sale violates the state gambling law requirement that a proposed casino developer have full site control within 60 days of getting a license.

The state gambling commission in September voted 3 to 1 to back Wynn’s vision of turning a polluted piece of Everett land into a glitzy casino. In doing so, the commission rejected a counterproposal backed by Mohegan Sun to build a gambling palace at Suffolk Downs.

A few weeks after the vote to award the gaming license to Wynn, three members of the group that originally owned the Everett land were indicted for allegedly lying to state investigators about the fact that a convicted felon had a stake in the property.

The gambling commission formally awarded the casino license to Wynn anyway, on Nov. 6 — two days after voters rejected a call to ban the casino industry from Massachusetts. Wynn finalized his takeover of the Everett land on Jan. 5. He closed on the MBTA land on March 3.

The gambling commission takes great pride in touting its transparency, as measured by all those public hearings. But while some parts of the process unfolded in public, others didn’t.

The MBTA land sale is one of those that didn’t — a deal worked out behind closed doors. Unfortunately for Wynn, it was put together just as the state’s top political guard was undergoing dramatic change. Now the political wires that worked well under former Governor Deval Patrick are being tested under Baker.

Wynn is represented by ML Strategies, a subsidiary of the law firm Mintz Levin.

William “Mo” Cowan, who served as head legal counsel and chief of staff to Patrick, is a senior VP at ML Strategies. The president and CEO of ML Strategies is Stephen P. Tocco, a former secretary of economic affairs under former Governor William F. Weld — who is now listed as a “principal” at ML Strategies.

And Baker, of course, got his political start during the Weld administration.

So far, the Baker administration is putting the people’s interest ahead of Wynn’s. That’s good news for the people and bad news for Wynn.

Joan Vennochi can be reached at vennochi@globe.com. Follow her on Twitter @Joan_Vennochi

 

 

 

Genting Buys Support!

Questions surround Greenwood Lake mayor's affiliation with Tuxedo casino project

By Hema Easley

Times Herald-Record

Published: 4:43 PM - 08/20/14
Last updated: 4:48 PM - 08/20/14

 

TUXEDO — On a warm evening in late July, Greenwood Lake Mayor Jesse Dwyer stood with young men and women welcoming people to a public hearing on the environmental review process for Sterling Forest Resort, the casino proposed by Genting Americas.

 

The group handed out stickers supporting the project. The men and women, several of whom were from Greenwood Lake, later spoke up at the hearing.

 

As mayor, Dwyer’s show of support was a given; elected officials in Tuxedo and the neighboring areas support the project. But his presence raised some eyebrows, because Dwyer’s public relations firm, Red Pillar Consulting, has been hired by Genting.

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“We know that Greenwood Lake Mayor Jesse Dwyer has been retained by Genting for public relations,” said Rodger Friedman, co-chair of Sterling Forest Partnership and a critic of the casino project, who was responding by email to an article in the Record about the public hearing. “Therefore we suspect that the GWL contingent may have been purchased, although the article represents them as concerned citizens.”

 

Dwyer disclosed his association with Genting soon after his firm was hired in the spring, and has recused himself from any vote relating to the casino. Greenwood Lake has strong ties with neighboring Tuxedo but is not an approving authority for the project.

 

Dwyer dismissed suggestions that support from his village had been purchased by Genting.

 

“There is a natural enthusiasm for this project in Greenwood Lake, with or without my help,” he said, noting that residents were excited about the prospect of jobs, economic development and the construction of Exit 15B on the Thruway.

 

Russ Haven, a legislative counsel at the New York Public Interest Research Group, described the criticism of Dwyer as “rumor or innuendo.”

 

Haven suggested that Dwyer reach out to an ethics commission in the area for suggestions on how he might avoid the appearance of a conflict of interest if some people were concerned.

 

 

 

http://www.recordonline.com/apps/pbcs.dll/article?AID=/20140820/NEWS/140829977

 

 

 

The Ultra-Orthodox community is frequently disappointing in their positions!

Ultra-Orthodox leaders reject anti-casino stand

Rabbi Caller doesn't 'represent our communities'

 

By Steve Israel

Times Herald-Record

Published: 2:00 AM - 08/14/14

 

THOMPSON — Ultra-Orthodox Jewish leaders in Sullivan County have renounced a letter from another member of that community opposing a proposed casino. The move comes after Town of Thompson Supervisor Bill Rieber called on those leaders to repudiate Rabbi Nachman Caller's letter to the state and support casinos.

 

Last month, Caller blasted the proposed Empire Resorts/EPR Properties casino at the old Concord resort in a letter to the board that will choose up to two casinos in the Hudson Valley/Catskills. He told the Gaming Facility Location Board that he represents more than 400,000 summer visitors.

 

"Such a casino would be an affront to our communities' sensitivities, and devastate the environment for our communities, summer camps and children, most of which are located within the immediate vicinity of the Concord," Caller wrote.

 

That brought an immediate response from Rieber, who called on the rest of the county's Orthodox summer leaders to counter Caller's letter, or else.

 

"The gloves are off," he wrote. "Anything less than a strong and very public statement from the Orthodox community leaders denouncing this unorthodox letter will be construed by us as total support of the content and Rabbi himself. Twenty-years plus of relationship building will be for naught. Game over."

 

The leaders of the community didn't exactly come out and endorse casinos, as Rieber wanted.

 

"We are not religiously permitted to support (casinos)," seven leaders wrote. "(But) we are not fighting such activities."

 

They did repudiate Caller.

 

"Mr. Nachman Caller is not an attorney or spokesman for our community." they wrote. "He does not work for us, nor does he speak or write on our behalf. He does not represent our communities."

 

 

http://www.recordonline.com/apps/pbcs.dll/article?AID=/20140814/NEWS/408140325

 

 

 

How much more evidence do we need?

Justice hearing casino repeal case tied to Suffolk Downs

By Andrea Estes

| Globe Staff May 11, 2014

Ted Fitzgerald/pool

Justice Robert Cordy sharply tested lawyers arguing to get a casino repeal on November’s ballot, though he represented Suffolk Downs and another gambling firm in the 1990s.


Justice Robert Cordy of the Supreme Judicial Court led the questioning of casino foes who asked the court last week to allow a ballot question that could repeal the state’s 2011 casino law. He sharply challenged the opponents’ argument that voters can abruptly make casinos illegal after casino companies have spent millions of dollars applying for licenses.

“A five-year exclusive license that’s already been awarded . . . at great cost by the applicants, can simply be taken away with a big never mind?” Cordy asked the lawyer representing the group Repeal the Casino Deal. “You can do that? Without compensation? Wow.”

 

It turns out Cordy has more than a passing familiarity with the difficulties casino companies have doing business in Massachusetts. In the 1990s, Cordy was a lawyer and a lobbyist for Suffolk Downs, one of two possible locations for the Eastern Massachusetts casino, and a second gambling company that was seeking to build a casino in the state.

Cordy also served as senior adviser to Governor William Weld, who is now an attorney for Steve Wynn, Suffolk Downs’s rival for the Boston-area casino license.

Cordy’s past ties to the gambling industry came as a surprise to the parties arguing before him Monday and raised questions among some judicial ethicists. Unlike legislators, judges are not required to file disclosures about potential conflicts, and Cordy did not voluntarily notify parties in the case.

“Our attorneys have faith in the impartiality of the Supreme Judicial Court, but, as a grass-roots activist new to this world, I have to say this sure puts some of what we have heard in perspective and is a reminder of the deep tentacles of this industry,” said John Ribeiro, chairman of the casino repeal campaign.

Cordy would not discuss his former work for the gambling industry, but he said through a court spokeswoman that his efforts then were completely unrelated to the debate now before the SJC.

 

“Justice Cordy has been on the bench since 2001,” said court spokeswoman Jennifer Donahue, “and hasn’t been in private practice for 14 years. None of the work that he did in the 1990s has any bearing on the case presently before the court.”

Donahue said Cordy has recused himself from participating in some cases during his 13-year career at the SJC, but she did not provide specific cases.

Suffolk Downs, in a statement Saturday, downplayed the connection to Cordy, noting that the racetrack had different owners then.

“This has to do with matters from almost 20 years ago under the prior ownership interest,’’ said William J. Mulrow, chairman of Suffolk Downs. “We don’t believe this has any bearing on our current efforts to preserve Suffolk Downs’ 79-year legacy as one of the area’s sports and entertainment venues, and to preserve the hundreds of jobs here and at small businesses and family farms in the Commonwealth.”

As a partner at McDermott Will & Emery in the 1990s, Cordy represented the owners of Suffolk Downs, which was looking to open a slot machine parlor in collaboration with the Wampanoag tribe, the Globe reported at the time. From 1995 to 1997, Cordy hosted meetings at his office in failed attempts to work out a formal agreement, according to the Globe articles.

Someone who worked at the firm said Cordy organized at least one outing for McDermott Will & Emery attorneys to the racetrack.

Cordy also worked for Hilton Gaming, records show. Hilton was one of three casino operators that financed a successful 1995 campaign to persuade voters in Holyoke to approve casino gambling, records say. Cordy acknowledged at the time that he had lobbied his former boss, Governor Weld, on gambling matters.

Some 15 years later, Suffolk Downs, one of Cordy’s former clients, is helping to pay for the opposition to the repeal effort now before the SJC. The racetrack is also part of a group that has formally intervened in the case, and a lawyer for the group argued Monday before the SJC.

In addition, a lawyer and a consultant Cordy worked with in the 1990s now work for Suffolk Downs.
Specialists in judicial ethics said judges have to be sensitive to the appearance of impropriety, but they are given a lot of latitude as to when they should step down from cases.

For instance, Justice Elena Kagan has removed herself from US Supreme Court cases she had been working on months before as a top litigator for the Obama administration. But judges do not automatically disqualify themselves from cases just because they worked on similar ones years before or even because they once represented parties before them

“There is a catch-all provision [in the judges’ code of ethics] that says a judge must recuse if the judge’s impartiality might reasonably be questioned,” said Stephen Gillers, professor of legal ethics at New York University School of Law.

“There are thousands of cases on the subject. But what they all say is you don’t look through the eyes of a suspicious person. You look through the eyes of an objective, fair-minded observer knowing all the facts.”

But Gillers said the general public has a different perception of judicial fairness.

“What . . . you often hear from the public is a chasm between what the public believes should be the conflict rules for the judges and what judges think the conflict rules should be,” said Gillers. “The scope of disqualification is much narrower from the judicial point of view.”

Attention to Cordy’s past ties comes days after the gambling commission chairman decided to remove himself from the debate over an Eastern Massachusetts casino because of accusations of favoritism.

Chairman Stephen P. Crosby withdrew from further involvement in the awarding of the Greater Boston license, acknowledging that recent actions, including his attendance at a private party at Suffolk Downs, raised questions about his impartiality.

Boston officials and a former casino applicant, Caesars Entertainment, had called on Crosby to recuse himself, complaining of bias. Caesars has filed suit against Crosby and others accusing him of favoring the Wynn proposal because of his former business relationship with one of the owners of the land where Wynn wants to build his casino.

In Cordy’s case, none of the parties in the casino repeal debate say they will ask him to step down because of his past casino connections, but casino opponents were concerned about the relationships.

Matt Cameron, general counsel of No Eastie Casino, said he knew “casino money had infiltrated every branch of government.”

“The attorney general, the governor, the gaming commission have all been directly influenced by casino interests,” Cameron said. “But I wouldn’t have said it about the SJC before you told me this. I watched the oral arguments and was surprised by Justice Cordy’s vehemence.”

Another casino opponent agreed. “It doesn’t surprise me,” said Brian Herr, a leader in the casino repeal campaign and a Republican candidate for US Senate, referring to Cordy’s previous gambling ties. “It’s become obvious to me that the reach of the casino industry is far, wide, and deep, even in a state like Massachusetts that doesn’t have a resort-style casino.”

But Carl Valvo, a lawyer for the pro-gambling group that wants to keep the referendum off the ballot, said he has “utmost faith in the system.”

“Each of the justices has their own connections to the world and the past,” he said.

Attorney General Martha Coakley, who is a defendant in the lawsuit brought by the anti-casino activists, declined to comment.

An SJC decision on the gambling repeal question is expected this summer.

Even if casino opponents win their case, they still need to collect 11,485 new signatures by June 18 to be able to secure a spot on the November ballot. Secretary of State William F. Galvin needs to know whether the SJC will allow the ballot question to go forward by July 9 in order to print ballots.


http://www.bostonglobe.com/metro/2014/05/10/supreme-judicial-court-justice-hearing-casino-case-worked-lobbyist-for-suffolk-downs/ywQuHjRTQwAylFGmxbbu7J/story.html?s_campaign=email_BG_TodaysHeadline




 

Walsh calls for top gambling regulator to recuse himself

Yoon S. Byun/Globe staff/file 2013

Stephen Crosby.

By Mark Arsenault

| Globe staff April 17, 2014

 

 

 

 

Mayor Martin J. Walsh is calling on the state’s top gambling regulator to recuse himself from any decisions about licensing a casino in the Greater Boston region, accusing him of bias against the city and its efforts to gain more influence over two casino proposals just beyond its borders.

“Throughout the process, Chairman [Stephen] Crosby has made several statements, which the city deems prejudicial,” Elizabeth Dello Russo, a lawyer for the Walsh administration, wrote in a blistering letter to the commission on Thursday.

 

Dello Russo accused the commission of trying to “stack the deck” against Boston, to deny the city a fair hearing on its claim for more say over a Wynn Resorts casino proposal in Everett and a Mohegan Sun casino plan in Revere. The letter mentions a federal lawsuit by Caesars Entertainment that also accuses Crosby, chairman of the state gambling commission, of bias.

“Taken together, the pending federal lawsuit, recent commission statements, current press articles, and the commissions’ own actions, create a cloud over the proceedings when Chairman Crosby participates,” the city stated.

Crosby and the commission declined last evening to respond, through the commission’s spokeswoman, Elaine Driscoll. The commission’s legal staff is reviewing Boston’s letter, she said.

The relationship between the new mayor and the gambling commission is off to a bumpy start: Walsh last month unexpectedly upset the casino licensing sweepstakes by declaring to the commission that the city is a “host community” to the two casino projects under the 2011 state casino law, with rights to hold binding votes in Boston on the proposals.

The question of Boston’s status could have enormous influence on the development of the state’s nascent casino industry. If Boston wins “host” status, both casino projects would be in jeopardy: It is unlikely either development would survive a neighborhood referendum in Boston.

 

The mayor insists that the Charlestown neighborhood should vote on the Wynn project and that East Boston residents deserve to vote on the Mohegan Sun proposal.

The commission, in response to Walsh’s demand for “host” status, delayed its June target date for the award of the lucrative casino license, and set up a month-long process to sort out Boston’s assertions. The commission invited interested parties to submit briefs by Thursday on whether Boston qualifies as a host community for one or both of the casino projects.

Walsh, in the city’s letter, objected to the process, calling it “unfair.”

“The process . . . unreasonably limits and compromises the city’s ability to receive and present evidence in support of the city’s declarations as a host community,” and would violate Boston’s due process rights, the city told the commission. The Walsh administration also complained about an inability to present or cross-examine witnesses, pursue discovery, and to create “an appropriate evidentiary record” for a legal review in court.

“In sum, the proposed procedure represents a thinly veiled attempt to stack the deck against the city on the host community issue so that the commission” can issue the Greater Boston license “without the city’s interference in the process,” the city alleged.

The mayor’s spokeswoman, Kate Norton, warned that Walsh will not participate in a procedure he believes is unfair, and said that the city is “keeping all of its options open” in pressing its claims that it is a host community to the two proposals.

What happens next would appear to be up to the commission. The panel could move ahead and decide the host dispute without the city’s participation, and then defend the action in court if Walsh sues. Or the commission could come to some accommodation with the mayor. The commission received several briefs on Boston’s host community assertions in time for Thursday’s deadline, and intends to post them on its website by Friday, according to Driscoll.

Wynn and Mohegan Sun say their projects, while very close to the city line, are not in Boston, and therefore the city is not a host community.

Both casino companies say Boston qualifies for a lesser designation under the law that would permit Walsh to negotiate compensation to offset the negative effects of a casino, but would not give Boston neighborhoods the right to vote on the developments.

State casino law defines a host community as “a municipality in which a gaming establishment is located” or proposed. A gaming establishment, under the law, is “a gaming area and any other nongaming structure related to the gaming area and may include, but shall not be limited to, hotels, restaurants, or other amenities.”

Walsh has argued that both casino projects depend on Boston’s transportation network, and that the city is “a key selling point” of each project. The mayor also says that access to the Wynn development is over a private way in Boston and that the Mohegan Sun proposal at Suffolk Downs is “intimately related and cannot be disentangled from the Suffolk Downs site,” most of which lies on the East Boston side of the Boston-Revere city line.

On Thursday, Walsh raised an additional point about the Wynn proposal, urging the commission to investigate issues raised by recent Globe articles on the Everett property Wynn intends to buy, and lingering concerns about whether the sellers have undisclosed partners.

The Globe has reported that one co-owner of the proposed Everett casino site has refused a commission requirement to sign a pledge that there are no secret partners in the deal. The city of Everett is exploring a move to take the land by eminent domain and selling it to Wynn.





http://www.bostonglobe.com/metro/2014/04/17/mayor-martin-walsh-calls-for-state-top-gambling-regulator-recuse-himself/nVeGjMdlakuYhAb33eQi2J/story.html

 

 

 

Massachusetts Gaming Commission expenses 'unrivaled' among state agencies

FROM: Mimi Panitch

I'm sure it seemed like a great idea at the time, to the people drafting the casino legislation. Fund the newly-established MGC from casino licensing fees! That way it will be independently funded, and not a line-item on the state budget ...that we argue over year after year, and the cost won't come out of the taxpayers' pockets!*

Only no one considered all the possible ways that casino licensing might play out, and either no one realized the potential for perverse incentives or else whoever did realize it was ignored. The assumptions undergirding this funding mechanism are that there will be plenty of acceptable casino operators who are dying to locate in Massachusetts, and plenty of Massachusetts cities and towns that are eager to have them. So, the assumptions run, there's no issue with funding MGC with $15 million in taxpayer money, via a no-interest loan. The licenses will be awarded easily and without material controversy, and there will be enough competition for them that there will be no reason to worry about the MGC aligning itself with the casinos that are the ultimate source of its funding, to the detriment of the public interest.

Only, as we know, it didn't quite play out that way. In the western region, casinos have been rejected by the voters of Palmer, West Springfield, and Holyoke (in substance, if not formally). It was once widely thought that the MGC would be reluctant to give the regional license to Springfield because of issues with MGM and its connections, but while the issues have been acknowledged, MGM is now the only possible licensee -- unless MGC is willing to start over from the beginning. In the east, there's the ugly situation with Revere. The appetite for casino development in Massachusetts is simply not what the drafters of the legislation envisioned (or at least, the appetite isn't there under the terms set forth in the enabling legislation).

And meanwhile, the MGC has been spending money at levels that are raising a lot of eyebrows. For good reason, although it's easy to see how it happened.

But now, we come to the implications, and the ways in which the funding structure weakens the MGC, gives it perverse incentives, and undermines its appearance of integrity. They have been profligate in spending money loaned to them by the state. Their profligacy has been justified by the idea that it's all the casino operators' money, merely an advance against funds that will start flowing in as soon as the licenses are granted. Licenses that it is within the MGC's discretion to grant or not.

There is at best limited competition for those licenses. The circumstances surrounding them might make a truly neutral authority hesitate when it comes to licensing the last applicants standing, or to impose very stringent conditions on them when it comes to issues like neighboring community mitigation. And yet, the MGC is now in a position where it has personal, powerful incentives to grant those licenses -- without the licenses, the licensing feels don't come in, and scrutiny of their own expenses is much less likely to be deflected. On a personal level, they've run smack into a potential conflict of interest -- substantively, I mean, not so much in legal terms -- that runs the risk of tainting any decision they make. In the public eye, if nothing else; but that's not a negligible consideration.

All of which makes for a giant illustration of why writing legislation that works as intended is hard. Harder than it looks, and generally harder than you believed could ever be possible when you started working on it. But somehow, that's not a whole lot of consolation when you're staring down the results of a technical mistake.


*Which of course it does anyway, because if the expenses are taken out of licensing fees that would otherwise have gone to the Commonwealth . . . I mean, this isn't rocket science. But leaving that aside.

 

 

 

Massachusetts Gaming Commission expenses 'unrivaled' among state agencies; include luxury hotels, high-end restaurants

 

Members of the five-person Massachusetts Gaming Commission attend a news conference in Boston. From left the members are: Enrique Zuniga, James F. McHugh, Chairman Steve Crosby, Bruce Stebbins, and Gayle Cameron. (File photo | Associated Press)

 

By Boston Business JournalThe Republican
on February 21, 2014

By CRAIG DOUGLAS
Boston Business Journal

The Massachusetts Gaming Commission has left no stone unturned in its rigorous, years-long effort to hand pick the list of casino operators who will ultimately operate in the Bay State. Nor have the commission and its politically connected staffers spared many expenses when it comes to traveling and entertaining both near and far.

A Boston Business Journal analysis of credit card statements and reimbursement reports has spotlighted repeated instances of lavish employee spending since the commission’s inception two years ago. The expenditures, which have been criticized by a state watchdog and at least one casino-license applicant, include dozens of charges at luxury hotels and top-rated restaurants in major cities throughout the world. Other outlays include millions in payments to international gaming consultants.

Unlike other state agencies, the gaming commission has operated without formal guidelines on the amounts and types of personal spending and travel permitted among its employees. In many documented cases the commission’s employees have flouted the agency’s own $71-per-day recommendations when it comes to meals expenses incurred on the job.

Some of those same gaming officials have had tens-of-thousands in airfare, meals and hotel costs covered by the largest casino operators in the world, the same multinational companies that are vying for a select number of licenses to operate in the wealthy state of Massachusetts.

Members of the gaming commission — established by the 2011 state law that allows up to three resort casinos and one slots parlor to open here — have defended the agency’s spending as necessary and proper. In several interviews with the Boston Business Journal, MGC officials said comparisons to travel and reimbursement budgets at other state agencies are unfair given the commission’s daunting mission and tight timeline to establish a new multibillion-dollar industry for the state. They also emphasized that a considerable amount of the MGC’s costs, some $15 million to date, have been reimbursed by casino operators as part of their applications for gaming licenses in the state.

“The process has to be thorough,” said Enrique Zuniga, one of the state’s five gaming commissioners. “Cost is really a secondary factor.

Examples of the commission’s extreme spending are many, ranging from a state police officer’s one-way flight from Hong Kong to Boston for $7,257 to a $5,550-per-month housing allowance for top executives to more than $78,000 in parking benefits provided to commission employees in Boston.

That parking perk, according to state law, is prohibited at Massachusetts agencies that receive taxpayer funding.

Other charges are of a more personal nature. One commission employee used her agency-issued Bank of America credit card to order from an online wedding-goods vendor. Another employee used his card to buy a $423 iPad. Commission Chairman Stephen Crosby treated a colleague to a $110 visit to a wine bar in Singapore, while Zuniga charged $422 to Plaza Limousine, the self-proclaimed preferred car service for the Boston Red Sox and local VIPs.

The spending pattern has drawn sharp words from former state inspector general Gregory Sullivan, the man who drafted the state’s employee-spending and travel regulations a decade ago. He said the spending rules, which were updated in 2011 and are enforced by the state Executive Office of Administration & Finance, were crafted in response to recurring instances of extravagant travel and entertainment spending at many state agencies. He said there is no reason why the gaming commission should be exempt from the same spending parameters.

The BBJ asked Sullivan, who served 10 years as inspector general and now is a research director at

The Pioneer Institute in Boston, to review the MGC’s spending records as they apply to the regulations he helped establish in 2004. “As far as I am concerned, the gaming commission is a state agency. And these examples are wildly beyond what state employees are entitled to,” Sullivan said.

“These figures offend my sensibility.”

The buck stops where?

During a phone interview this month, Zuniga said the agency’s mission has been unique from the start. He said it is misguided to compare its employee expense and travel reports to those of other state departments in which less travel is required.

He said commission employees must adhere to an employee handbook, published in 2012, when it comes to travel and related expenditures made while on official gaming-commission business.

A review of the commission’s employee handbook found a single reference to travel, hotel and meals expenditures incurred by employees. The handbook recommends a daily meals cap of $71, while “reasonable charges for hotel accommodations will be allowed upon presentation of receipted bills.”

The employee pamphlet does not include guidelines on costs and usage of airline services.

The commission’s expense trail frequently blows through the official spending caps outlined for public employees traveling on behalf of state agencies. In some cases, including nine round-trip flights to Las Vegas that cost between $750 and $900 apiece, the price of airfare and hotel room rates were two to three times the typical economy rates offered by competing airlines and hotels.

Zuniga said the urgency of the commission’s mission often requires last-minute travel planning and unexpected meetings with gaming-industry stakeholders who frequently move from one exotic gaming location to the next. He said commission employees must abide by strict ethics guidelines and that there is no conflict of interest in having gaming companies reimburse the commission for any travel or consulting costs incurred during license investigations.

Of the $15 million in commission costs covered by gaming applicants, Zuniga said at least one applicant — who was not identified — has “pushed back” on the spending amounts submitted for reimbursement. The commission reported about $13 million in direct operating expenses in the fiscal year that ended June 30.

“We cannot let a plane ticket determine how we are going to feel about an investigation,” Zuniga said.

Blueprint for financial independence

Whether the state’s travel and personal spending policies apply to the gaming commission remains a foggy issue. As written, the state’s spending rules apply to “all persons employed by … commissions and other agencies receiving state appropriations.” The rules’ spending limits include, among other things, a $30 daily cap on meals reimbursements, with no more than $6 to be covered for breakfast, $8 for lunch and $16 for dinner.

On its website, the commission contends it is “not funded with taxpayer monies, or state appropriations,” a status that enables it to operate outside of public-employee spending and travel guidelines in Massachusetts. “We are not funded with a line item,” Zuniga said.

The commission was initially funded with a $15 million interest-free loan from the state’s rainy day fund, a debt that will be repaid as the state sells gaming licenses and collects operating fees from gaming companies, MGC officials said. Both revenue sources are key to the commission’s long-term plan to be self-sustained and financially independent from the state.

License fees for gaming companies in Massachusetts are either $25 million for the slot machine parlor license, or $85 million for a resort casino license. The commission is expected to award its sole $25 million slots-parlor license later this month, by picking a winner from three rival proposals.

Sullivan, the state’s former inspector general, said the reasons for such spending and how it is paid for are irrelevant, and that the commission and every other public agency has a duty to taxpayers to keep costs to a minimum whenever possible. Any other approach threatens the government’s credibility in the public’s eye, he said.

“If you have rules then nobody’s taking $900 flights to Las Vegas or a $7,000 flight to Hong Kong,” Sullivan said. “But apparently they’re claiming they don’t have any rules.”

No rules to the road

Despite two years of operations and extensive travel costs incurred in the United States and abroad, the commission has yet to formalize its own employee-travel and reimbursement policies, other than the brief mention in the employee handbook. A commission spokesman said an effort to do so started last year, but was delayed until a full-time finance and accounting chief could be hired. That person, Derek Lennon, officially joined the MGC in October as its chief finance and accounting officer.

Based on draft proposals provided to the BBJ, the commission intends to peg its travel reimbursement rates to those recommended by the U.S. General Services Administration and U.S. Secretary of State. Both federal agencies set reimbursement rates that vary by city.

But there are numerous examples of past commission expenses that dwarfed the spending caps set by the GSA and Secretary of State. For example, the GSA’s daily hotel rate for Las Vegas, $92, was approximately half the $181 daily rate paid by Zuniga during his four-night stay at The Venetian in September 2012. A BBJ review of hotel rates in Las Vegas for September of this year turned up dozens of room rates at or under the GSA spending cap. Similar discrepancies were found when comparing commission hotel rates paid in Hong Kong, Bangkok, London, Poland, Virginia Beach, New Jersey, Ohio, Philadelphia, Saratoga Springs, N.Y., and various locations throughout Massachusetts.

Dining near and far

Between May 2012 and the end of 2013, commission staffers spent approximately $85,000 on airfare, $61,000 on hotel accommodations and another $37,000 on meals. The totals were based on a BBJ review of more than 700 credit card charges and expense reimbursements.

As of Jan. 1, the commission had 43 employees, with about half of them making at least $100,000 per year in salary. Those figures do not include a handful of state police investigators assigned to support the commission’s gaming-license applicants.

MGC commissioner Stephen Crosby has been among the more frequent users of the company meal card. Room service is a particular favorite of his. On a recent trip to Asia, Crosby recorded 10 food-related room charges during a five-night stay at the Pan Pacific Hotel in Hong Kong. The total cost for those meal charges — not including nine visits to the mini bar that Crosby covered out of pocket — was $565, according to his room receipt.

Most of the commission’s larger meal tabs have been recorded in the United States. In April 2013, Crosby and three other MGC officials paid $446 — approximately $111 apiece — at Mamma Maria in Boston’s North End. Two months later he was reimbursed $432 for a dinner he hosted for two MGC director candidates at the Boston Harbor Hotel, according to receipts.

All told, Crosby has recorded at least $13,000 in meals, airfare and hotel-related expenditures and reimbursements since mid-2012. His salary this year is $154,500, the commission’s second highest behind MGC Executive Director Rick Day’s $185,000 annual pay. Day was among two other MGC staffers who, after joining the commission, received a temporary executive-housing benefit of $5,550-per-month.

Not included in Crosby’s meals total are about $20,000 in commission charges to the Levy Restaurant Group for meals at the Boston Exhibition and Convention Center and the Hynes Convention Center in Boston. MGC spokeswoman Elaine Driscoll said those expenditures, 12 in all for an average cost of $1,600 per event, have largely covered food and drinks supplied during the commission’s lengthy public meetings.

Zuniga said the charges paid to Levy, the convention centers’ official food-service provider, probably saved the commission time and money over the long term, as it enabled people to stay on site and largely work through lunch and other scheduled breaks. He said Levy’s prices “are not that competitive,” but that the convention centers’ physical spaces are ideal to accommodate large groups.


http://www.masslive.com/news/index.ssf/2014/02/gaming_commission_main_story.html

PA State Treasurer McCord: $57,000 in campaign donations.....

Bill Kearney

Massachusetts ‘GAMING’ Future

It must have been a casino operator who coined the phrase "money talks and bullshit walks."

Pittsburgh Tribune-Review - Feb. 12, 2014 - State Treasurer McCord withdraws from gaming board sessions on Philly casino...

HARRISBURG — State Treasurer Rob McCord, who waged a legal battle to attend executive sessions as a non-voting member of the Gaming Control Board, told the board chairman he will not participate in closed-door sessions on applications for a second casino in Philadelphia.

McCord, a Democratic candidate for governor, said he did so in “an abundance of caution.” He received more than $57,000 in campaign donations from law firms and lobbyists representing gambling interests in 2011 and 2012. It is legal for him to do so and doesn't violate the agency's code of ethics, said Doug Harbach, a board spokesman. McCord's campaign did not want to comment.

McCord sued the board in May 2010 and signed a February 2012 settlement agreement to abide by its ethics policy. Commonwealth Court ruled he has the right to participate in the board's executive sessions.

Read more: http://triblive.com/news/adminpage/5583646-74/board-mccord-firms#ixzz2tOpZLlp6