VIDEO LOTTERY FACILITY LOCATION COMMISSION MINUTES. Ocean Downs Racetrack, Berlin, Maryland

Transcription

1 VIDEO LOTTERY FACILITY LOCATION COMMISSION MINUTES DATE: July 15, 2009 TIME: PLACE: PRESENT: 3:00 p.m. Ocean Downs Racetrack, Berlin, Maryland Video Lottery Facility Location Commission Donald Fry, Chairman Thomas Barbera Robert Neall Ella Pierce D. Bruce Poole Linda Read James Taylor Maryland State Lottery Paul Dorsey, Director of Policy and Development Robert Howells, Director of Procurement Marie Torosino, Executive Associate Department of Legislative Services Warren Deschenaux, Director, Office of Policy Analysis Ryan Bishop, Policy Analyst, Office of Policy Analysis Rachel Hise, Policy Analyst, Office of Policy Analysis Office of the Attorney General Robert Fontaine Holly Knepper Ocean Enterprise 589 LLC William Rickman, Jr. Owner and Chief Executive Officer William Fasy, Chief Operating Officer Andrew Gentile, Executive Vice President of Operations Others Members of the Worcester County Commissioners Members of the Press Members of the Public

2 Prior to the Location Commission meeting, Mr. William Rickman of Ocean Enterprise gave those present a tour of the grandstand area and a description of the renovations that would be made if Ocean Downs is approved for a video lottery facility license. There being a quorum present, Chairman Fry called the meeting of the Video Lottery Facility Location Commission to order at 3:15 p.m. Chairman Fry said this is the Commission s first visit to a proposed video lottery facility site. He introduced the other members of the Location Commission that were present. They were Ella Pierce, Linda Read, James Taylor, Robert Neall, Bruce Poole and Thomas Barbera. Under the statute, the Commission has the responsibility to examine the proposals that were submitted and make the decision as to whether or not the proposals comply with the criteria that is set forth in the statute. The Commission will be following those criteria and working with PricewaterhouseCoopers, the consultants who are assisting them, along with Department of Legislative Services staff. The State Lottery Agency and the Maryland State Police are assisting with the financial and criminal background investigations. The Commission s goal is to make a decision with respect to these proposals by the fall of Today s agenda includes a presentation of the Ocean Enterprise proposal by Mr. Rickman and his staff, and an opportunity for the Location Commission and the public to ask questions. He asked Mr. Rickman to discuss the Ocean Enterprise proposal. Mr. Rickman thanked the Commission for coming to Ocean Downs and said his group has over 13 years experience in the slots industry. Ocean Downs consists of 168 acres. The grandstand was built in the 1940 s and the clubhouse was built in the 1960 s. He gave a detailed explanation of the construction that would occur in the grandstand and provided display boards showing renderings of the proposed facility. If approved for slots, he proposes installing 200 machines temporarily in the clubhouse. The preliminary stage for the grandstand would be 600 machines, which includes 200 machines from the clubhouse plus adding 400 machines. At a later date, 200 additional machines would be added bringing the total to 800 machines. Chairman Fry asked when the temporary facility would be ready and when would the new facility be completed. Mr. Rickman responded that the initially proposed 200 machines could be installed in the clubhouse within 90 to 120 days after approval by the Commission. The 600 machines could be available in the new facility by the end of May An additional 100 machines would be added by December 2010 and another 100 by April This would give the facility a grand total of 800 machines by April Chairman Fry said one of the criteria in the statute states that the location selected should strive to be a destination location and asked for a description of the additional amenities that would be made available to make this a tourist destination. Mr. Rickman responded the facility is not permitted to have live entertainment. However, it can have one piano player and fireworks. There is some concern that Ocean Downs may take business away 2

3 from Ocean City but he feels it will only add to the community and help turn Ocean City s summer season into a year round destination. Commissioner Poole said he was questioned this morning by a member of the public whether there is going to be sufficient infrastructure and regarding a change in the zoning. Mr. Rickman responded this particular property is technically zoned residential, but it is for the racetrack and the fairgrounds. This particular piece of property is specifically targeted for high density. It does not say what type and that becomes a local issue. It will be necessary to dedicate front property for the widening of Route 589 and he has met with the State Highway Administration to comply with this requirement. Commissioner Pierce asked if there any problems regarding zoning in the area. Mr. Rickman responded there is no problem with zoning. He has met with the Worcester County Commission. Chairman Fry asked Mr. Rickman to discuss the anticipated amount of funds that will be spent on the facility and the expected revenues. Mr. Fasy responded $22 million will be spent in pre-construction costs, $13.5 million in construction costs and $9.5 million in furniture, fixtures and other items such as surveillance rooms and technology. Commissioner Poole asked what means Ocean Enterprise would use to get people to visit the facility. Mr. Fasy responded there are a vast number of people coming to Ocean City each season and some of those people will visit Ocean Downs. A feasibility study was done internally with a third party that analyzed the market. Ocean Downs is within a 150 mile radius of Atlantic City, Delaware, Pennsylvania and West Virginia, so their market is in competition with these facilities. Ocean Downs will focus on the hospitality side. They are going to know who the players are and win over the customer with that friendship that is going to be different than their competitors. They are going to train their staff on an annual basis, similar to the approach that Disney utilizes. As an example, if a customer visits the Ocean Downs facility when it opens up, then the next day something would be mailed to them saying thank you and to come back, possibly with an incentive that falls within what would be allowed. Commissioner Poole asked if Ocean Downs would draw people from Delaware. Mr. Fasy responded it is going to be very difficult to draw loyal customers away from Harrington and Dover Downs because they have been in business for a period of time. There is a market on the Eastern Shore, in Virginia, in Annapolis, in Cambridge and the surrounding area that hopefully will visit Ocean Downs. Commissioner Poole asked what the Worcester County Commissioners vision is for the surrounding area and their view on the infrastructure investment. Several members of theworcester County Commissioners will be given an opportunity to speak later during the meeting. Chairman Fry asked how many people are currently employed in jobs associated with the racetrack. The response was there are currently 252 employees. 3

4 Commissioner Read asked if Ocean Downs is working with hotels in the area on a tourist destination package. Mr. Fasy responded not at this time. Chairman Fry said the Commission had the opportunity to look at the proposal that was submitted by Ocean Enterprise. One of the questions raised was the potential of the facility being a destination location. What are the plans for future economic development opportunities in growth in the nearby community adjacent to this facility? County Commissioner Judy Boggs responded that Worcester County is very supportive of this project and will work closely with Mr. Rickman to facilitate the process to the best of their ability. As far as zoning in the area, currently she cannot give any further indication because they are in the middle of the zoning process. Commissioner Poole asked if Ocean Enterprise is awarded a license, what is the County looking at in five or ten years in terms of the surrounding area and roads. County Commissioner Linda Busick responded that in 2006 a comprehensive plan was developed and approved and this area was zoned as agricultural. The County Commissioners are reviewing various designations to see if they agree or disagree as to what the proposed zoning would be for the surrounding areas and throughout the entire county. However, when the comprehensive plan was developed in 2006, the slots issue was not something that was considered. The area is made up of both commercial and residential. Legislation indicated that the State may provide funding for widening Route 589. They recently met with the State Highway Administration (SHA) and there are certain responsibilities for both the developer and for the State. She said Mr. Donnie Drewer from the SHA will address that issue. Mr. Drewer explained that with or without slots, there are traffic issues on Route 589, especially during the summer months. If a license is awarded to Ocean Enterprise then SHA would again meet with them to conduct a traffic impact analysis, similar to what any other developer would do. Whatever problems the traffic would create, Ocean Downs would have to mitigate the problems. For example, if another lane is needed to handle traffic on Route 589 from Ocean Downs to Route 50, then that would have to be completed. There are some preliminary plans that have been developed of what they think Route 589 from Route 50 would look if like slots are approved. If approved for a license, Ocean Enterprise would submit their traffic impact analysis to SHA. Commissioner Poole asked if an award is made, what would the lane from the racetrack to Route 50 cost and to explain the mechanics. Mr. Drewer responded the cost of the changes to Route 589 have not yet been determined. Currently, for someone traveling on Route 50 from Salisbury, there is a single left turn lane onto Route 589. The first thing that may be done is to have a double left turn lane added on Route 50 and double lanes added on Route 589 to accept that. Mr. Rickman said as part of the bid process they were required to do a traffic study. He assumes that at some point if they go forward, they will give the study to SHA for review to see what changes would have to be made. 4

5 Commissioner Pierce asked if it is anticipated that Route 589 would be widened in time for the opening of the facility. Mr. Rickman responded that SHA will have to analyze this when they look at the traffic study. Ocean Downs is not a very big facility and traffic will be less than racing traffic because it is spread out all day long. However, this is a conclusion that SHA will have to make. Chairman Fry asked if there were any further questions from the Commission. At this time the Commission will take a break to give the public an opportunity to look at the renderings of the proposed facility. He asked any members of the public who did not sign-up in advance to sign-in if they wish to testify at the public hearing. Chairman Fry opened the public hearing with a brief explanation of the criteria that the Commission will be taking into consideration in the evaluation of the proposals, which is 70% based upon business and market factors, which includes the highest potential benefit to the State; 15% based upon economic development factors; and 15% based on location siting factors. At this time, there are four people who have requested to make comments. Chairman Fry called on County Commissioner Judy Boggs. County Commissioner Boggs said she lives in and represents the Ocean Pines District. She thanked the Commission for giving her the opportunity to share her thoughts and concerns regarding an issue that is very important to the community. The Ocean Pines District is located on Racetrack Road (Route 589). Knowing Mr. Rickman and his experience as a businessman, developer and racetrack owner, she feels that he will provide a first class facility. The County Commission will work with him to facilitate the permit process and assist him from a county perspective. However, the Ocean Pines community has a major concern. Because they are bordered by the coastal bay, every road that leads out of Ocean Pines exits onto Route 589. However, as Mr. Drewer stated earlier, Route 589 needs to be widened whether or not slots are approved. The community expects to see an improvement to Route 589, primarily at the Route 50 intersection and a portion of the road that goes to the Ocean Downs property. She is in agreement with Mr. Drewer because they have to facilitate the traffic getting in and out including the horse trailers. These necessary improvements to Route 589 will help to alleviate the impact of the expected additional traffic on a road that is already overburdened. She wanted to express her appreciation to the SHA for their efforts to involve the residents of the community in the planning for future improvements to Route 589 and looks forward to continuing to work with them. Also, regarding Marylanders going to Harrington in Delaware, she feels that Ocean Downs will be a very attractive venue. She commented that every week buses are filling up to go to Harrington and people would rather stay local. She thanked the Location Commission for coming here today and allowing the County Commission to share their thoughts and concerns. Chairman Fry thanked Commissioner Boggs for her comments. He also recognized Delegate Norman Conway, representing Worcester and Wicomico Counties in the Maryland General Assembly and Chairman of the House Appropriations Committee, who is in the audience. 5

6 Chairman Fry called on Mr. Dan Meyer. Mr. Meyer said he represents the horsemen s organization at Ocean Downs. They wholeheartedly endorse Ocean Downs as a slots venue. It means the survival of racing at Ocean Downs as well as the continuation of racing in the State. He hopes they will reap the benefits that their racing neighbors have in Pennsylvania and Delaware. Chairman Fry called on Mr. David Placher. Mr. Placher said he is with the Maryland Gaming Association and asked how Ocean Enterprise plans to reach out to the community regarding possible employment and will they consider hold a job workshop or training seminar. Mr. Fasy responded Ocean Enterprise will hold a job fair and will inform applicants of the expected qualifications. They ensure that the applicants within a 10 mile radius will be given the utmost opportunity. Chairman Fry called on Mr. James Karmel. Mr. Karmel said he is a Professor and Gaming Analyst, and is also with the Maryland Gaming Association of Consultants. He thanked Chairman Fry and the Location Commission for the open, public hearing today. He is in support of the Ocean Enterprise application. In general, gaming is a wonderful opportunity for entertainment and recreation for millions of Americans. There is no reason why people coming to Ocean City or those that live in the area shouldn t have those opportunities. Gaming is a great opportunity for economic development in the area and it has a positive economic influence. Many jobs will be created in the Maryland industry. Not just entry level jobs but opportunities for marketing investors, service providers such as wholesale food retailers, printers, etc. The more the County and the State can do to facilitate the depth of the Maryland gaming industry, the better off Maryland will be. Chairman Fry called on Mr. Bruce Wade. Mr. Wade said he lives in Ocean Pines and believes the introduction of slots in the County has multiple benefits, both for employment and taxes. He hopes that the Location Commission and County Commission will work to make this happen. Chairman Fry called on Mr. Ray Unger. Mr. Unger said he is on the Board of Directors of Ocean Pines and several people he has talked to are delighted that they may not have to go 50 miles to a slots facility, but instead can go a mile and a half for entertainment at the track. Chairman Fry asked if there is anyone else who would like to comment. A local resident said Ocean Downs has been wonderful in allowing her to hold fundraisers at Ocean Downs for the past 12 years in support of her community. Thank you and good luck. Chairman Fry said that will conclude the public hearing and the meeting. He thanked Delegate Conway for his work in Annapolis and his presence here today. As indicated earlier, this is the first in a series of visits to the various proposed slots facility locations. The next meeting will be held on August 13, 2009 at 1:00 p.m. in Cecil County regarding 6

7 Penn Cecil s proposal. On August 26, 2009, the Commission will meet regarding the proposal submitted by Baltimore City Entertainment Group. On September 9, 2009, the Commission will be meet regarding the proposal submitted by Cordish for Arundel Mills. There will be an opportunity for public comment at each meeting and asked that the members of the public submit their comments in writing prior to the meetings. It is the intention of the Commission that they will begin making their decisions in the fall of The Commission looks forward to working with Mr. Rickman and his partners with respect to the consideration of their proposal. Chairman Fry adjourned the meeting at 4:37 p.m. Respectfully submitted, Marie A. Torosino 7