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What you need to know for 01/21/2018

Casino hopefuls must ante up soon

Casino hopefuls must ante up soon

The state Gaming Commission released its 80-page request for applications last week, outlining exact
Casino hopefuls must ante up soon
Howe Caverns' hopes to put a casino on its 330 acres in Schoharie County. It would be placed behind the Adventure Park. Pictured is Chris Tague, member of the development team of Howes Cave Development Corp, pointing to the proposed destination.
Photographer: Stacey Lauren-Kennedy

As a 3-D video led Realtors through the layout of the proposed Mohawk Harbor development, a simple white box labeled “casino” came into view.

The spot designated for live table games was in stark contrast to the detailed elements of the $150 million project proposed by the Galesi Group on the site of the former American Locomotive property.

The video shown at Bowtie Movieland Thursday showed what other amenities at Mohawk Harbor might look like — condominiums with balconies overlooking a boat slip carved into the southern bank of the Mohawk River; a hotel rising over the retail stores lining Erie Boulevard.

“What it is, it shows you it fits,” explained David Buicko, Galesi’s chief operating officer. “Basically, it’s a place holder.”

Like at least five other sites, the 57-acre former American Locomotive site is being eyed by a deep-pocketed casino operator interested in opening the Capital Region’s first state-licensed facility with live table games. For now, these companies are only shopping — and their browsing is being done with a large degree of anonymity.


At least for now. The state Gaming Commission released its 80-page request for applications last week, outlining exactly what is needed from prospective operators and starting the countdown that ends with the June 30 deadline for casino proposals.

Provisions in the request for applications, or RFAs, so far haven’t cut down the list of a half-dozen sites looking to land one of the state’s four casino licenses. Even the Saratoga Casino and Raceway in Saratoga Springs, where host community support has been tepid at best, casino proponents still are optimistic they can secure a license.

The owners of the sprawling harness track with more than 1,700 video lottery terminals are the only potential casino operators who have confirmed their interest in a casino license in the Capital Region. This despite the fact that the RFA mandates local support for a prospective operator’s application, and that the Saratoga Springs City Council adopted a non-binding resolution not to back a casino under the conditions laid out by state law.

The adopted resolution doesn’t, however, preclude the council from supporting an application submitted by the Saratoga Casino and Raceway. With the amount of detail demanded by the RFA, the tenor of the conversation could change once the racino goes public with its plans.

“So far, all of the discussion on this issue hasn’t included a very important detail, which is what any of this will look like,” said Morgan Hook, a spokesman for Destination Saratoga, an advocacy group in favor of bringing live table games to the racino. “In a lot of ways, this conversation only started [with the release of the RFA].”

The RFA’s release spells out specific deadlines for information, which gives prospective operators about 17 days to make a serious commitment toward the process.


Applicants are expected to submit their first questions about the RFA by Friday afternoon. The facility location board — the ad hoc panel tasked with recommending sites for up to four licenses — will respond to questions on April 23, at which time prospective operators are required to have paid the $1 million application processing fee.

The fee must be paid before the state reveals the minimum capital investment required to qualify for one of the licenses — a figure the location board won’t release until 10 days after a mandatory applicant conference on April 30. Once an application is submitted, the fee becomes non-refundable.

The RFA also requires casino operators to submit proof of local support before the board will consider an application. This means “a resolution passed by the local legislative body of its host municipality supporting the application,” according to the RFA.

Support is also required in the application itself, via public statements or declarations made by surrounding municipalities, private organizations, religious groups, entertainment venues, chambers of commerce and local businesses, among others.

The degree of local support will constitute 20 percent of the criteria considered by the location board, according to the RFA.

The bulk of the decision — 70 percent — will be based on economic and development factors. That includes capital investment by a company, projected revenues for the state, proposed completion time and job creation.

The final 10 percent of the decision will be based on so-called workforce enhancement factors. This includes incorporating local labor, taking measures to reduce problem gambling, and using sustainable development principles during construction.

Prospective operators are required to undergo a rigorous background check funded through their initial application fee. Applicants need to fill out 89 pages of documentation of personal disclosure, listing everything from their business interest to a detailed record of any arrests.

The five-member location board — only three of whom are now seated — are expected to view presentations from the applicants starting on July 21. Though the board is directed to make a decision by sometime this fall, no hard date is listed in the RFA.


Once a decision is made, the winning casino operator will need to come up with some serious cash in short order, including the state licensing fee within 30 days, set at $50 million for the 10-year Capital Region license.

After the award, the operator would have to deposit 10 percent of the total investment amount into a state-approved escrow account. If the casino does not pan out, the deposit is forfeited to the state.

Operators have two years to get the casino operational, or face a fine of up to $50 million, according to the RFA.

“Many, sometimes surprising, details about the gaming industry are regulated in minute detail that the average layman would not expect,” said Melissa Perry, a postgraduate fellow in racing and gaming law at Albany Law School. “This high degree of government intervention is due to gambling’s shady past and the fear of infiltration of organized crime.

New York’s licensing fees are similar to those in other states, and New York’s schedule of fees is significantly lower than the $85 million charged by Massachusetts for resort casino licenses.

“From a state’s perspective, the reason to allow casinos in the door is revenue,” Perry said. “The collection of that revenue begins at the very entrance to the state — through the licensing fees.”

The release of the RFA has heightened speculation about where a casino will land in the Capital Region and what it will bring to the host community.


In Schoharie County, there’s a proposal from Howe Caves Development Corp., a limited liability corporation marketing 330 acres for a casino project. Though declining to go into detail, spokesman Chris Tague said four different casinos operators are interested in the property.

“We’re 100 percent committed to make this a site,” he said. “I don’t see anywhere near the support in the other areas that are pondering putting the casino in.”

Tague said the combination of local support, proximity to Albany and need for economic development make the site the obvious choice.

“If you were to look at what the governor envisioned and then come to the How Caves site to see what it offers, I’d say its a no-brainer,” he said.

Schoharie County is now mulling a resolution in support of casino development and will host a public hearing on the matter on April 15.


Other sites are already stacking up support resolutions in the hope of attracting a casino. Half of the municipalities in Montgomery County have already issued resolutions supporting a casino on 520 acres of farmland off Route 30, straddling the town of Florida and the city of Amsterdam.

Economic Development Director Ken Rose said the local resolutions of support — including from both host communities — the need for economic development in the region and close proximity of the site to Thruway Exit 25 make it an attractive site for a casino. He said a private operator continues to scout and expects an announcement in the near future.


Another project on the outskirts of Albany appears close to gaining the first local support it needs to apply for a license. Capital District OTB and Rochester developer David Flaum are pitching a $300 million resort nearby the interchange of Thruway Exit 23, including a 63,000-square-foot casino, 275-room resort-style hotel and 40,000-square-foot indoor water park.

Albany Mayor Kathy Sheehan said the city council will soon introduce a resolution supporting the project and expects it will have the backing to pass when it comes up to vote sometime early next month. She said the site, known as E23, is being designed to supplement what the city has to offer, rather than drawing business away from entities like the Times Union Center, the Palace Theatre or the 82,000-square-foot convention center that recently was approved for Albany’s downtown.

“The sense thus far is that people are cautiously supportive,” she said. “We’re hearing some really positive things and we’re seeing some significant benefits for the county as well.”


Across the river in the city of Rensselaer, Mayor Daniel Dwyer remains confident that a proposed $250 million waterfront project known as DeLaet’s Landing will emerge as the logical site for a casino. In January, the city passed a resolution supporting a casino locating at the 24-acre shovel-ready site already approved for high-rise hotel and more than 1.3 million square feet of mixed-use space.

“It’s a perfect site,” he said. “It’s right across form the capital, it’ll help Albany, we’ve got the train station within walking distance, and we’ve got all the roads.”

Dwyer said the casino would also breath new vitality into the city, which has struggled for decades. And above all, the project could get under way as soon as the license is awarded.


Schenectady’s pitch for a casino is still awaiting a resolution indicating local support, but Mayor Gary McCarthy hinted of a looming announcement that could pertain to a prospective casino operator.

“At this point, I’m supporting the application of a casino,” he said.

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