A Suffolk Downs casino would give the city of Boston at least $32 million annually and the East Boston neighborhood an upfront payment of $33.4 million under an agreement reached with Mayor Thomas M. Menino today.
The deal between the mayor and casino developers includes provisions that could increase the annual payment to Boston much higher if the $1 billion casino is highly profitable.
The long-awaited deal allows the Suffolk Downs proposal to move towards a referendum vote. And it returns Suffolk Downs to significant contender status for the Greater Boston resort casino license.
Despite earlier objections, Menino will allow phased opening of the development.
“I have said from the start of this process that I wanted three things: A first-class resort destination casino, an agreement that would benefit the people of East Boston, and a proposal that will be selected by the State Gaming Commission,” Menino said in a statement. “We are well on our way to that and more.”
The agreement ends more than a year of sometimes difficult negotiations, during which Suffolk Downs watched a rival project from Wynn Resorts grab momentum by quickly striking a deal with Everett, and then winning a landslide in a referendum.
Suffolk Downs is competing for the sole Greater Boston resort casino license with Wynn and with a Foxwoods project in Milford.
In negotiating the complicated deal, Menino used a number of outside consultants, including transportation and environmental experts, financial forecasters, real estate specialists, casino industry consultants, and the Rev. Richard McGowan, a Boston College casino and gambling expert.
The casino developers have projected that the casino would generate gross gaming revenue of $1 billion. With that much revenue, the casino would be required to pay $52 million annually to the city. If revenue rises to $1.2 billion, payment would rise to $80 million.
Other provisions of the deal, according to the mayor’s office, include:
-- Developers committed to spending $50 million a year on goods and services in Boston and $5 million specifically in East Boston.
-- Developers committed to an early opening 14 months from start of construction and full opening after another 12 months.
-- Developers committed to continued operation of the race track.
Suffolk Downs straddles the Boston-Revere city line, and had to negotiate deals with both communities. The deal with Revere has been done for months. The details of that agreement have been kept confidential so they could be released with the Boston pact.
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