It's over! .... for Middleboro

Thank you,

Frank Dunphy
President Casino Facts Committee

Contributed by Mark Belanger

Updated with impact costs obtained from FinCom

If we sign this deal, we will lose more than $150K and likely into the millions of dollars

Ok. I've had time to digest and analyze this document in some detail. Please contact me if you have any corrections.

The bottom line: This agreement provides less than half of the money we need. This deal will cost the town money or at best break even. The only acceptable deal would include a percentage of the gross slot revenue. The going rate for selling an idyllic small town is north of $20 million dollars. A percentage of slots would insure that as revenue and thus impact increases, so does the money. When we get a percentage of the slots that adds up to more than $20M, I will stop complaining about the money. I will continue to complain about the social impacts, but will shut up about the money. We can not accept a facility that does not fully address the costs and impacts.

In this article, I intend to analyze the substance of the draft agreement - as much as I can given that I am not a lawyer. This is the agreement reached with the Mashpee Wampanoag Tribe and negotiated by Adam Bond, Ruth Geoffries, and Dennis Whittlesey.

I have to say, that many parts of this document are a big improvement over the original draft agreement. The people that wrote it clearly did listen to the complaints raised by the first agreement. I acknowledge that and give credit for it. It's nice to be listened to for a change. The phrase "good faith" is mentioned more than 12 times and there are many parts that seem rather hastily thrown together and subject to later "good faith" negotiation. A deal of this magnitude must be thorough, considered carefully, discussed with the public, and ironclad. This agreement is none of those things.

The project revenues of $11 million dollars are overly optimistic and probably are closer to 7 million dollars. I base this number on this math:

+7.0M (base payment that increases by 3% a year)
+2.0M (realistic hotel tax income)
-2.8M (costs in police/EMS salary pensions)
-3.0M (school costs)
-1.0M (general government costs)
-1.0M (employee fringe benefits)
-1.1M (removal of the trash fee that Mr. Perkins is always promising
-250K (extra ambulance needed according to Rodgers/FinCom)
-----------
 -150k - We will lose $150K.

Note - this does not include the infrastructure improvements. Most of those are not needed if we have no casino. The Rt. 44 work can be done by the state if needed, and upgrades to utilities to accommodate normal growth can happen the same way it happens for every other town in the state. The deal was supposed to bring us extra money to lower taxes, buy open space, fund the library, shine my shoes, remove trash fees, etc, etc, etc, etc, etc. It will do NONE OF THOSE THINGS.

The BOS should explain themselves for trying to sell us this pig in a poke by not providing all the impact costs to us. Well....? I'm waiting.

I put in a freedom of information act request to the town departments impact assessments. They have not been delivered to me. Fortunately FinCom has some of the numbers. I got the impact costs for schools, government, and employees from a document passed out at the 7/25/2007 Finance Committee meeting. If you are interested, the documents are here: Page1, Page 2, Page 3

This total does not of course include costs for a new police station or money for any of the departments such the DPW and all the other costs that will come with this facility. In case you don't know, I am against the casino. Please read this document carefully, listen to my justification of this analysis, read the agreement, and decide for yourself. Clyde Barrow a "UMASS gambling expert" said that first deal is too little and too rushed. This agreement brings us similar financial compensation and I couldn't agree more. It's too little and with less than a week to analyze it.... it's WAY TOO SOON.

When West Warwick cut a deal with the Narragansett tribe, they got an agreement that would "would pay the town $14 million the first year, up to $21 million in the 10th year all based on the tribe paying 2 percent of its gross revenue along with local property taxes and other local fees."

The city of Barstow California in an agreement negotiated by Whittlesey got $6 million dollars that increased at a rate of 4% for a facility that would only have 1700 employees compared to our 10,000+ employee facility. By the way, this was a case of reservation shopping gone wild with a proposed casino nicely situated between Las Vegas and Los Angeles but hundreds of miles away from the Tribe's location.

• In section 22E this agreement forces us to write letters of support for putting this land into trust. Why do they need if they can do this without an agreement with Middleboro?
• The size of the facility is undefined and contains a clause to renegotiate if the size increases which is good. The main facility remains undefined so while we can increase the deal if it gets bigger, we don't know how big it will be to begin with so we can insure that we are getting enough of a base payment.
• The guaranteed base payment is a 7 million dollar that increases at 3.1% a year according to CPI. I'll point out that our budget is projected to increase at 8.6% a year. That said there is nothing the agreement can do to enforce fiscal sanity on us.
• The only other money is a 4% tax on room receipts that will be much lower than the $4 million dollar figure being bandied about in the press and by the town/tribe. It will be more like 1-2 million. The reason for the reduction is that casinos give complimentary points(comps) and free rooms to attract gamblers and maximize slot revenues. We won't earn money on the comps. This is why we need a percentage of slots. If you doubt what I am saying, this section of the agreement says it all "except for complimentaries and rooms occupied as a result of player points or other similar promotions".

  What I find disturbing is that when Whittlesey and Bond were asked, Adam didn't even seem to know what comping was, and Whittlesey didn't know how prevalent it was. That means that a key part of the agreement that gives us money was negotiated by people who didn't understand the ramification of what they were negotiating. Given the rush to get this deal done - what other slap-dash stipulations are we going to be stuck with?

• The town is committing to creating it's own ambulance service that will add costs in salaries and benefits such as health care and pensions. It highly unlikely that this will turn a profit for us. If it would we could do it with or without a casino driving it.
• The Tribal-Town committee that will advise on future matters - is structured so that the tribe will always come out on top in any dispute. The first agreement has been improved upon in that the committee becomes advisory only. The town and the tribe are not compelled to act on their behalf.
• The town is signing away it's free will. We will be legally bound to pursue the interests of the casino even when they are at odds with our best interests. Unlike the first agreement, the tribe will pay any legal expenses.
• We are bound to supply services(water,sewer,power,etc) to the casino - which they will pay for. In the case of electricity, there is a stipulation that the "rates will be favorable to the Tribe". It is unclear what will happen once their demand outstrips our supply. This isn't a criticism so much as an observation.
• Code Enforcement(building, fire, etc) has a built-in conflict of interest. It has been improved over the first agreement in that there is a provision for independent consultants to do periodic review. I'm satisfied that this is sufficient.
• They seem to be committed to reducing the impact on town surface roads. I don't see any money for changes we might have to make in town for local traffic impacts other than Rt. 44.
• Does not directly address any of the increases in town expenses - school expenses for example - that will come with the inevitable increase in population. The document acknowledges that there will be impacts and provides essentially for training. However, the large impacts across all departments will have to be managed by the insufficient sums designated by this agreement.
• Does not address any of the "promises" made by Glenn Marshall when he gave his "presentation" at the Nichols School. Specifically, it was promised that locally impacted businesses and homeowners would be compensated. In this article Mr. Marshall said he would personally ensure that the community is not harmed by a casino in terms of local businesses.

  Resident John Tessier said his greatest concern is that local businesses will close because everyone will patronize restaurants and shops in the casino complex. He said David Fisher, who owns three local restaurants including Dave's Diner, has worked hard to build his businesses.

  "If David Fisher loses a lot of business, you'll make sure he's happy?" Mr. Tessier asked. "You'll come down with a checkbook?"

  "Absolutely," Mr. Marshall replied, drawing laughter and applause from the audience when he added, "I have to tell you tonight we all ate at Dave's before we came here."

  There is absolutely nothing like this in the agreement. If someone is going to come here and give us his word, then that person has to follow up on it by including it in the agreement.

  1500 X .9 X 200 X .04 X 365 = 3,942,000

  1500 X .9 X .32 X 200 X .04 X 365 = 1.26 million dollars.

  1500 X .9 X .5 X 200 X .04 X 365 = 1.97 million dollars.

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