Schenectady needs host deal for casino

Mayor should lobby for host community benefit package from casino operators

Mohamed A. Hafez

For The Gazette Opinion section

While many rejoiced over the selection of Schenectady as a site for a casino, after the dust settled, residents realized that a Host Community Agreement (HCA) is an area that was left out of the planning for the casino project.

An HCA is an agreement signed by the casino developer typically to provide the host community with funds to mitigate the additional burdens placed on the municipality as a result of the project, address the direct and indirect impacts, commit to a mitigation plan, and pay a community impact fee.

The town of Tyre, Seneca County, with a population less than 1,000, engaged the Center for Governmental Research (CGR), a not-for-profit group, to assess the impact of the proposed Wilmont Casino and Resort on the Tyre community. The CGR studied the agreements negotiated between casino developers with other municipalities in Massachusetts and New York, and reviewed the HCA to be signed by the town’s casino developer Wilmorite, Inc.

Acting to protect the town’s residents, secure a binding contractual obligation from Wilmorite and relying on the CGR report, in June 2014 the town supervisor introduced the HCA to the town’s board for a vote.

To guarantee that Wilmorite will in fact pay its obligations in the agreement, Wilmorite’s annual obligation to the town will be secured by a $4 million first-priority lien on the project.

In addition, Wilmorite agreed to pay for all financial, legal and engineering expenses associated with the project.

It also agreed, among other things, to pay for the mitigation of direct community impacts, such as installation and maintenance of new water and sewer lines for the casino; design telecommunication infrastructure; pay the cost of new firefighting equipment and training; pay for a new sheriff’s deputy; pay unreimbursed ambulance fees; give hiring preference to qualified Seneca County residents; solicit bids from local vendors; provide voucher reward programs to county businesses; limit its lodging facilities to no more than 220 rooms for 10 years; and pay the town $600,000 to fund the purchase of development rights related to the preservation of agricultural land in the town.

Concerned that funds collected by the state for problem gambling may not trickle down to the county and town, the Seneca County mental health department signed a separate memorandum requiring Wilmorite to take all described actions to mitigate gambling addiction and other social impacts on the community.

Wilmorite also agreed to pay for the mitigation of indirect community impacts, addressing the need for additional town infrastructure, facilities, equipment and employees, and for issues related to public health, safety, welfare, addictive behavior and quality-of-life as follows:

Commencing on Jan. 15, 2015, Wilmorite agreed to pay the town an indirect impact fee of $750,000 in 2015, $2 million in 2016 and $2 million in 2017. For 2018 and thereafter, the fee is $2 million, plus annual increases adjusted by formula.

To eliminate that cost to taxpayers, Wilmorite will pay for the town’s contract with the fire department; $104,000 in 2015 and $200,000 per year thereafter.

Other communities in Massachusetts and New York clearly recognize there can be adverse casino effects. These can be mitigated, addressed, and maybe even reversed through such a mechanism as an HCA. Why not in Schenectady?

I call upon the Schenectady mayor to secure a binding agreement with the casino developer, and to take all necessary actions to protect our neighborhoods and city residents from the casino’s adverse impacts in such a way similar to what the Tyre town supervisor has done to protect the town and its residents.

Mohamed A. Hafez is a resident of Schenectady.

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