Notes & Quotes: Casino Deal Approved

Gaming Control Board

We're on the Pennsylvania Turnpike again, just heading back from Harrisburg and the Gaming Control Board vote approving transfer of control of the Pittsburgh casino license.

In the end, the vote was unanimous. Board members took great pains to emphasize that "this was not a rush to judgement" and that politics did not drive their choice. One member suggested that politics were behind some of the criticisms they faced leading up to the vote.

Here are some quotes from Billionaire casino investor Neil Bluhm, following the vote:

"If this didn't go ahead, this would be in bankruptcy, tied up for a long period of time. Instead you're going to have a wonderful casino, a great project on the river, and I'm sure the citizens of Pittsburgh will enjoy it and at the same time (it will) create a lot of jobs...."

"Tomorrow, we should be wiring funds and hopefully close on the transaction and on Monday the contractors will be back at work and we'll be on our way."

Representatives of contractors and unions had testified that some local companies could have been driven out of business by losses due to bills unpaid by Barden's PITG Gaming if it had gone bankrupt.

Ken McCabe, Gaming Board Member:

"I think if we revoke it or rebid it will only help a small group of people and would be disastrous for thousands of families, for Pittsburgh, and for the commonwealth."

Sanford Rivers, Gaming Board Member:

"Mr. Bluhm, thank you for removing the doom and gloom that hovers over the Pittsburgh casino and it's amenities."

James Ginty, Gaming Board Member:

"To deny this application would do a tremendous disservice to the people of Pittsburgh, to the citizens of Allegheny County and to the citizens of Pennsylvania.."

State Senators Jane Orie and Jim Ferlo -- who had urged the board to revoke the license -- did not come to testify. They submitted their statements in writing. Ferlo had a staffer at the hearing who provided copies to reporters. In it, he says:

"....it seems the board's actions are not intended to provide an open, fair. And objective public process, but instead to speedily cover its tracks."

...and...

"...the process leading up to this hearing has been shrouded in secrecy. Repeated letters requesting documentation of the buyout were either ignored or met with indifference."

"It was only last week that my office began receiving this information, which is very complicated, and it has been filled with redactions. Important names and financial numbers have been removed making discerning information from the documents difficult"

Senator Orie's office e-mailed a statement to the media, but the pdf format isn't legible on the small screen of the BlackBerry I'm using to write this post.

The gaming board staff says:

"A PowerPoint presentation made today to the Board has been posted on the PGCB web site. A link to the presentation can be found under the 'What's New' section of the PGCB's home page, www.pgcb.state.pa.us .

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Parking Tax: Orie Warns of Penalties

State Senate Majority Whip Jane Orie says she's preparing a letter to Pittsburgh's oversight board, asking it to warn City Council: by freezing the parking tax rate, council risks a cutoff of all state funds to the city. The ability to impose that penalty is one of the powers granted to the oversight board by state lawmakers. Pittsburgh's financial recovery plan approved by the Pennsylvania legislature requires that the parking tax be scaled back. That was part of the trade-off in exchange for additional taxing powers granted to the city, including the annual $52 emergency municipal services tax.

Councilman Jim Motznik, the sponsor of the legislation, had hoped that council's passing of the freeze would provide the basis for a conversation with state lawmakers in Harrisburg next week. Orie's reaction does not bode well for that conversation.

Motznik argues that parking lot and garage operators did not pass along this year's parking tax cut to consumers. His bill would lock in this year's parking tax rate at 45 percent instead of lowering it to 40 percent for 2008. His legislation dedicates revenues from the five percent difference to making payments on the city's debt and pension fund obligations. [PG & Trib coverage of the issue.]

You can watch video of my Channel 4 Action News report on the Pittsburgh Channel.

Here are some key quotes from my interviews with Orie and Motznik. They were conducted separately on Tuesday.



Orie:

• "It violates the spirit and letter of the law. It's in complete violation of the state law. This was negotiated in a bi-partisan fashion."

• "Right now,what Councilman Motznik is doing is a back door tax on the backs of the commuters."

• "It's irresponsible for them to have passed this. I believe there is no support in the legislature to do this."

• "There are ramifications for violating the law, and they could lose state moneys. That alerts them them, you are taking an action in violation, this is what is at risk."

• "Under state law, if they want to play this game---and it's really sad, because they're violating the letter of the law--not only can the state withhold funding. The state, because it's a state created city parking authority, we can force them to reduce the rates."


Motznik:

• "I don't feel that it's illegal. We here on council control old taxes, new taxes, what tax rates are going to be."

• "I think it helps the cause in Harrisburg, because it shows that we're being fiscally responsible with the funds that we would have lost."

• "It gives us a few months to take something to Harrisburg and try to work out an agreement."

• "Worst case scenario, we don't agree, then we're headed for probably some legal problems. But the idea is not to fight with the legislature."

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