Scott Van VoorhisBoston’s new mayor is still an enigma as far as his development vision goes – and everyone and his brother is counting project approvals, watching the Boston Redevelopment Authority like it was the Kremlin, and generally looking for clues in all the wrong places.

But a glimpse of what Mayor Marty Walsh’s style might be like as the Hub’s developer-in-chief, at least when facing big projects he is opposed to, can be found in his battle to extract millions in concessions from a pair of $1 billion-plus casinos proposed for sites along Boston’s borders.

 Walsh has launched a scorched-earth legal campaign against the redoubtable Steve Crosby and his Massachusetts Gaming Commission, while putting the squeeze on two of the largest casinos companies in the world.

While we still don’t know what Walsh’s approach to spurring housing construction will be, other than that he wants more of it, Boston’s freshman mayor has shown very clearly he knows how to bring down the hammer, and bring it down hard, when he has to.

“If you want to build a casino in the Greater Boston area, you are going to have to deal with him,” said David Begelfer, chief executive of NAIOP Massachusetts, which represents developers across the state.

 

Confronting The Gaming Commission

Boston is hardly the first community to hold out for a better deal when it comes to the rollout of casinos in Massachusetts, with local officials across the state pushing for mitigation money based on their proximity to the various proposals.

But Walsh, instead of meekly coming to the negotiation table to await the gaming commission’s judgment, has instead tried to flip the whole table over, and the commission along with it.

Mohegan Sun hopes to build this $1.3 billion casino in Revere.Rejecting an offer of “surrounding community” status for Boston, Walsh contends the Hub should be a “host community” for Steve Wynn and Mohegan Sun’s proposed gambling palaces, even though one is in Everett and the other is in Revere.

That would give Boston an effective veto power over both proposals – Wynn and Mohegan are both competing for the Eastern Massachusetts casino license – while entitling Boston to tens of millions in annual compensation.

Literally right on the Boston line, both proposed casinos depend on Boston for access roads and other transportation infrastructure, such as Logan International Airport, Walsh has argued.

And in pursuing his argument, Walsh has gone nothing short of nuclear. Not only has he challenged the commission’s authority to even determine whether a city or town should have “host community” status, he has taken dead aim at Crosby, an advisor to governors, university dean and political man about town.

Hopping onto a lawsuit filed by spurned casino bidder Caesars, Walsh contends the state gaming official’s judgment has been clouded by a conflict of interest that prejudiced him towards Boston. (A relatively ancient former business associate of Crosby’s owned land in Everett that was tied up with Wynn’s casino proposal, a fact he disclosed to the state ethics commission.)

Then he went over Crosby’s head to appeal to his boss, Gov. Deval Patrick.

Not sure what Walsh’s relationship with Crosby was before this, but if there was one, it has been burnt to a crisp. Given Crosby is on leave as dean of the University of Massachusetts Boston’s prestigious McCormack Institute, it’s not necessarily a negligible consideration.

“[Former Boston Mayor] Kevin White would take a hit – he took a bunch of hits when he took controversial positions like (the redevelopment of) Quincy Market,” noted Larry DiCara, a top Boston development lawyer and a former president of the Boston City Council. “I think Marty is prepared to take hits.”

 

Lessons For Boston Developers

For anyone interested in Boston development, the new mayor’s battle with the gaming commission is revealing in a number of ways.

Walsh is known as an amiable guy, free – so far as we know, at least – of former Mayor Thomas M. Menino’s intense grudge fests against the various Boston builders he distrusted or thought were too eager to seek out their own publicity.

But beneath that easy-going, city-boy exterior, Walsh has shown he packs a pretty fierce punch. Walsh’s legal strategy in his battle with the state gaming commission has been described by observers as “novel” and “pushing the envelope.”

It’s not hard to read between the lines here.

“Clearly Boston is not the host community,” said Rev. Richard McGowan, a Boston College economist and expert on the casino industry. “If you read the (casino) legislation, Walsh’s claim is no more than a swing in the dark.”

Yet Walsh’s big leverage here is not some brilliant legal loophole in the state’s 2011 casino law, but rather the power of delay at a critical time.

The Massachusetts Gaming Commission is desperate to show progress on awarding the state’s three planned casino licenses, with a final decision now still months away for the Boston area license after two and a half years of deliberations.

(By contrast, New York voters approved full-scale casino gambling in November, with Gov. Andrew Cuomo pushing to award the first licenses this coming fall.)

Walsh may not win, but the mayor and the city’s high-powered legal team can gum up the works by taking their dispute to the courts, tying up the Boston license with a year or more of legal squabbling.

For anyone versed in Boston development politics, this is 101 in how to kill a project: death by a thousand delays.

Moreover, Walsh also clearly has a shrewd sense of the state political scene, a natural given his years as a state representative from Boston.

In the background is the looming threat of a state referendum next fall, with the state Supreme Judicial Court set to decide whether a casino repeal question can appear on the ballot. That only adds to Walsh’s leverage – after all, the chances of a repeal will only mount if the mayor of Boston winds up in the anti-casino camp. As it stands now, Walsh’s decision to push the envelope and go for broke appears to be working wonders, with both casino developers now in talks with Walsh on a potential package.

The gaming commission is standing aside while the talks take place, a much better alternative than battling it out in court with Walsh.

And Walsh may soon be celebrating his first victory.

So what’s the upshot here? Yes, Walsh, formerly a top Boston construction union boss, is pro-development, having lobbied for years for major projects in hopes of jobs for his members.

But pro-development doesn’t mean rubber stamping everything that comes down the Pike, either. And as Walsh has shown in his colorful showdown with the state gaming commission, he is not someone to be trifled with.

 

Email: sbvanvoorhis@hotmail.com

Hizzoner, The Developer

by Scott Van Voorhis time to read: 5 min
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