State Clears the Way for Encore Boston Harbor Expansion

State gaming regulators decided Wednesday to interpret the 2013 casino referendum in Everett to have authorized gaming on not just the current site of Encore Boston Harbor but also at least one other swath of land across the street, clearing the way for the resort-style casino's expansion to move ahead.

Encore parent company Wynn Resorts plans to construct a new building across Broadway from its resort casino to host a dedicated poker room, a second sports betting parlor, a relocated nightclub, a theater, parking garage and more. It would be connected to the casino that opened in 2019 by a pedestrian bridge.

The question the regulators had to answer Wednesday was whether the language of the June 22, 2013 referendum that cleared the way for the casino to be located in Everett authorized casino gaming at just the location specified on the ballot or whether voters approved of a casino license generally - Wynn at the time was looking from a green light from voters before it could secure a license. The casino can move ahead with some version of its planned development either way, but it can only offer sports betting and poker there with the commission's agreement that such an expansion was something the 2013 voters understood they were voting on.

The Gaming Commission ruled last March that a previous version of Wynn's development proposal -- one that did not include poker or sports betting -- would not be part of the casino's official gaming establishment and therefore would not fall under commission jurisdiction or oversight, the outcome that Encore had lobbied for.

But once sports betting was legalized in Massachusetts last summer, the casino company changed its plans and now wants its "east of Broadway" expansion to include both casino gaming (poker) and sports betting, either of which would require the facility to be considered part of the official gaming establishment and regulated by the commission. With the decision Wednesday, the full project can now be reviewed in greater detail by the Gaming Commission and other city and state officials.

The precise question before Everett voters in 2013 was, "Shall the City of Everett permit the operation of a gaming establishment licensed by the Massachusetts Gaming Commission to be located at the property located on Horizon Way (off 'Lower Broadway') in Everett, formerly known as the Monsanto Chemical Site?"

The state's gaming law prescribed the referendum language and required that it include a description of the proposed location, but it does not at all address expansion of gaming establishments.

The commission voted 4-1 to decide that the expansion was contemplated in the language of the 2013 referendum and the host community agreement between the casino and city. Commissioner Eileen O'Brien was the dissenter, telling other regulators that she viewed the 2013 approval as "site specific" and that she is uncomfortable with the fact that no one was able to clearly define for her the boundaries of the location that was approved in 2013.

"I'm not opining on the appropriateness of the proposed expansion, what it would do; I think the plans for revitalization are fantastic for that area. What I am not satisfied with is any request that we say, 'you can expand, but I still can't tell you where the end of the expansion can go.' I am not comfortable with the 'I know it when I see it' response," O'Brien said. "But more importantly, I still don't know where the outer boundaries of this are. And I don't think that what we're doing today is the end of the discussion, because I feel like this is going to continue to happen."

The other four commissioners said they were satisfied that city voters understood in 2013 that the reference to the former Monsanto site was essentially shorthand for a larger section of the lower Broadway neighborhood. Commissioner Brad Hill pointed to language in the casino-city agreement that directly addressed how the city's impact fee could increase if the casino expanded as a sign that "they expected that there would be some type of expansion in that area, not specific to the location that they are currently in."

"If I was to think of the word casino, if I shut my eyes, and someone told me 'Well, there's going to be an expansion at a casino.' I would think most people -- not all, but most people -- would think 'well, if there's an expansion at a gaming facility, there's probably going to be an expansion of gaming as well.' I think that's what they think. I'm almost sure they do," Hill said. "My father had a little clothing store in Ipswich. When he expanded his clothing operation, there was nobody in Ipswich that thought it was going to be anything other than clothing in that expansion. So I think most people in Everett who voted, I think they truly understood what they were voting for."

When the commission wrestled with the same topic in November, the Gaming Commission General Counsel Todd Grossman said, "I think there's general agreement that the location across the street is not part of the former Monsanto chemical site." And Jacqui Krum, Encore's senior vice president and general counsel, said at the same meeting that the site of the proposed expansion was not part of the Monsanto chemical site.

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But lawyers for Encore owner Wynn Resorts said Wednesday that they were able to determine, using a city atlas from 1921 and historic land records, that Monsanto predecessor Merrimac Chemical Company owned parcels on both sides of the current casino site. The lawyers said that, though Merrimac Chemical sold the land about 100 years ago, "it is clear that Monsanto and or its predecessors were historically active both to the west and east of the current Encore site."

Everett told the commission that it views its 2013 referendum as sufficient to allow this expansion of the Encore casino, and said that it expects it would cost the city at least $130,000 if it had to hold a new city election to put the expansion question to voters.

"[T]he vote to approve of a gaming establishment by over 86% of the City's voters in June 2013 must be construed based upon the information provided to them by the City in advance of the election. This information included the Host Community Agreement, which explicitly anticipates and provides for expansion of the gaming establishment beyond the land shown," a city lawyer wrote to the commission. "In light of this fact, and of the fact that the City repeatedly and consistently presented the gaming establishment project as an anchor of the overall redevelopment of the Lower Broadway District, there is no reason to believe that the voters would have voted any differently had the original project included the [expansion]."

After about two hours of arguments for why the expansion should be allowed under the terms of the 2013 referendum, Chairwoman Cathy Judd-Stein asked the city and casino directly, "What's the problem, right, of doing another referendum?"

A lawyer for Everett, Jonathan Silverstein, said that holding a new citywide vote would be costly, could create delays for the casino expansion project, and would be disrespectful of the 2013 voters.

"Fundamentally, to my mind, it's a question of respecting the vote of over 86 percent of the voters back in 2013, who I have and will continue to submit voted in favor of a project that they all anticipated and, frankly, hoped would expand over time to provide more jobs and revenue and other benefits to the city," he said.

The Gaming Commission was also interested in how the other communities that host casino-style gaming, Plainville and Springfield, understand what their residents approved. Springfield did not respond, but Plainville put the question before its select board.

"It was the opinion of the Board that the referendum was site specific to 301 Washington Street," Town Administrator Brian Noble wrote in a letter to the commission, noting that the address encompasses a roughly 30-acre property that abuts Route 1 and Interstate 495. He added, "The Board believes that neither the wording of the referendum nor the zoning restricts the future expansion of Plainridge in its current location. They were clear, however, that while the referendum secured 75% support, it was not blanket permission for the entire Town."

Silverstein said the host community agreements in the two municipalities differ in key ways and that the Plainville document refers to a "specific property address and acreage" and speaks only to expansion of square footage at that specific address.

"And I can tell you why," Silverstein, who said he also negotiated Plainville's HCA for the town, told commissioners. "There was never any discussion in Plainville during the negotiations or the permitting of first Ourway [Realty LLC] and then Penn [National Gaming] acquiring additional land and expanding the gaming establishment onto additional land. However, that was a discussion from day one of the negotiations and discussions between Everett and Wynn. And so I think that's a really important point and that's exactly why in several locations throughout the Everett and Wynn host community agreement, in contrast to the Plainville host community agreement, there are explicit references to expansion onto new land."