Slots in city? Don't bet on it - LancasterOnline: News

Slots in city? Don't bet on it

Stubborn rumor about hotel-convention center is denied

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Posted: Sunday, April 19, 2009 12:21 am | Updated: 5:56 pm, Wed Sep 11, 2013.

It's the rumor that won't go away:

Didja hear they're going to put slot machines in the new convention center and hotel downtown?

For seven years at least it's been whispered, asserted and published. A letter to the editor in both of Lancaster's daily newspapers last week brought it up again: "Now that state regulators have given the go-ahead to Valley Forge to install 500 slot machines," asked the writer, "can the Lancaster County Convention Center be far behind?"

Local officials were unequivocal in their response: The convention center and adjacent hotel will host gatherings large and small. Visitors from all over.

But it won't host one-armed bandits.

"There will be no slot machines in this integrated facility," said Josh Nowak, director of sales and marketing for the convention center and adjacent Marriott hotel.

Indeed, a spokesman for the Pennsylvania Gaming Control Board, which oversees slots, said there's only one "Class 3" license left - and a group from the Poconos is applying for it.

Case closed? Not quite. Some long-time critics of the project on Penn Square remain unconvinced, saying that if it comes down to dollars and cents, they expect the one-armed bandit will come to town, official denials notwithstanding.

"If the project falls significantly short on revenue - which is a very real possibility, given the numbers which are available to the public - gambling might be the only way to avoid a significant tax increase," said Randy Carney, a city resident who has followed the project for years.

No application

To date, the Pennsylvania Gaming Control Board has "not received anything from anyone in that area [Lancaster County] wanting to apply for anything," board spokesman Richard McGarvey said.

The board, established in the wake of the 2004 law legalizing slots in Pennsylvania, has awarded 12 of the 14 licenses made available by the Legislature. The 12th was awarded April 8, when Valley Forge Convention Center Partners LP was permitted to install up to 500 slot machines at the Valley Forge Convention Center in King of Prussia. The license was the first awarded by the gaming control board since December 2006.

Two remain, though one is a "Category 1" license that can be awarded only to a horse-racing facility. McGarvey said a track in western Pennsylvania is in the process of applying for it.

The other available license is a "Category 3" license, which may be awarded to "well-established resort hotels with no fewer than 275 guest rooms under common ownership, not located within 15 linear miles of any other licensed slot machine casino, and already offering substantial year-round recreational guest amenities on their premises," according to information on the gaming control board's Web site.

The privately owned Marriott hotel being constructed next to the Lancaster County Convention Center by Penn Square Partners will have 300 rooms, and will not be within 15 linear miles of another casino. But is it "well-established?"

McGarvey said there is no definition of the term in the law. "That's just what it says, there's no specific criteria," he said.

As to "recreational guest amenities," McGarvey said that includes things like golf courses, "and they have to be associated with the facility." Amenities within walking distance don't count, he said.

Yet even if the local project qualified for this last license, McGarvey said, a Monroe County consortium has already applied for it.

The Bushkill Group Inc. wants to operate a slots casino at its Fernwood Hotel & Resort, a 440-acre hotel and recreation complex in the Poconos. The gaming control board is considering the application, but has reopened the application process for a 90-day period (beginning April 8) "in an effort to see if other qualified resorts would be interested in the license" and could put together the firm financial commitments needed to make it viable.

There have been no other applications so far, McGarvey said.

Once all existing licenses are awarded, only an act of the Legislature can create more, McGarvey said.

Lancaster County legislators, with the exception of state Rep. Mike Sturla, a Democrat who represents the city, have been staunch opponents of gambling, and lined up against a 2005 proposal to build a $150 million casino in the Bulova building at Queen and Orange streets in downtown Lancaster.

That doesn't mean the Legislature couldn't approve new licenses over their objections; but it does mean that attempting to build a casino in Lancaster, at the convention center/hotel or anywhere else, would be extraordinarily controversial.

Lisa Riggs, executive director of the James Street Improvement District - which promotes economic development in the downtown area - said that would be a huge disincentive to anyone who sought to bring slot machines here.

"The people who run these [gaming operations] are not dumb people," she said. "Why would they want to come into Lancaster and fight a battle royal?"

Art Morris, the former Lancaster mayor who now chairs the Lancaster County Convention Center Authority, responded to the letter to the editor earlier this month by saying: "We have a use for the facility. I have no interest in slots, and I know of nobody else on the authority who has any interest in slots."

He declined to elaborate for this article.

Lancaster Mayor Rick Gray was more blunt:

"There will not be any casino," he said Friday. "The people who are hoping [the convention center] will fail and we'll have to put in a casino will be disappointed. The people who are hoping for a casino will be disappointed."

Gray noted that when the plan for the Bulova casino was proposed, "You didn't see me in support of it." That's because Gray considers gambling amongst the most "regressive" of taxes, taking money from those who can least afford it and imposing social costs that outweigh revenues.

"I told the mayor of Bethlehem [where a Sands Casino Resort is set to open in May] that it's fool's gold," Gray said. But, he acknowledged, "It's tough for cities to turn down that kind of money."

Gray said he thinks the rumor of slots at the local convention center persists "because there are people who have it in their minds that this will fail, and there's really a conspiracy that when it fails," slots will be seen as the answer.

Some who remain suspicious say they're merely reading between the lines of the project's own legal documents.

"Note that High [Industries] retains the concessions for both common areas, exactly where the casino would go," said Robert Edwin Field, an early opponent of the convention center/hotel project and publisher of NewsLanc.com, which has posted several items speculating on the possibility of slots on Penn Square.

High Industries affiliate Penn Square General Corp., and Penn Square Ltd. LLC - an affiliate of Lancaster Newspapers Inc., publisher of the Lancaster New Era, Intelligencer Journal and Sunday News - comprise Penn Square Partners, the private developer that's building the Marriott hotel.

Carney, who attends most convention center authority meetings, said that over the years he's heard whispers from those close to the project that slots might be coming to town. Several months ago, he said, one project "insider" told him the hotel was going to apply for 10 slot machines.

"What is important to note about all of this is that if there is a proposal for slots, it won't come from the [convention center authority]; it will be initiated by the Penn Square Partners," he asserted.

"Personally, I think it will all come down to dollars and cents."

But Nowak was unequivocal:

"We've been hearing this rumor for a while," Nowak said. "It keeps coming up.

"It's not true."


Gil Smart is associate editor of the Sunday News. E-mail him at gsmart@lnpnews.com, or phone 291-8817.

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