Mohegan Sun Massachusetts today announced it has reached a host community agreement with the town of Palmer – establishing in excess of $16 million in annual mitigation payments to the town, and allowing a timetable to be set for a local referendum.
The agreement, which is subject to approval by the Palmer Town Council and the Management Board of the Mohegan Tribal Gaming Authority, calls for signing and "pre-opening" payments of close to $3 million, with the first $200,000 payable upon approval and setting of a referendum date by the Palmer Town Council.
The additional infrastructure improvements will include an estimated $23 million for expansion and improvements to existing roads, sewer and water systems in Palmer, including: enhancements to the water distribution system of Palmer Fire and Water District 1 and its neighboring water districts; improvements to the municipal sewer system; and road improvements and traffic mitigation – including substantial improvements to the Exit 8 entrance and exit interchange of the Massachusetts Turnpike.
"More than four years ago we began building a relationship with the great community of Palmer. Today I am happy to say we have forged a genuine partnership to bring jobs, economic growth and a new visitor economy to this town and the entire region," Mitchell Etess, CEO of the Mohegan Tribal Gaming Authority said in a statement. "We are confident this host community agreement, combined with our nearly $1 billion proposal, will deliver the very best for Palmer and Massachusetts."
The $16 million includes fixed payments totaling $15.2 million and a percentage of gaming revenue equal to .25 percent of the first $400 million in revenue. According to casino officials, these payments represent the largest per capita and per household mitigation of any western Massachusetts proposal and should help bring fiscal stability to Palmer, plus much-needed infrastructure improvements benefitting Palmer and the surrounding region. For every resident in Palmer, the town will receive more than $1,200 annually in mitigation payments, taxes and revenue sharing from Mohegan Sun Massachusetts. The guaranteed annual mitigation payment alone exceeds the entire local tax revenue for the Town of Palmer in fiscal year 2014. In addition to the revenue sharing on the first $400 million in revenue, the Town will receive an additional 2 percent from every dollar of gross gaming revenue from the gaming facility above $400 million annually, making the Town and Mohegan Sun true partners in the resort’s success.
Funds from the annual mitigation payments will be appropriated at the discretion of the town of Palmer. It is estimated, however, that Palmer will annually allocate the following from the Mohegan Sun proceeds:
• $1.125 million for municipal programs and economic development
• $875,000 for Palmer Fire District #1 for expansion of staff and equipment
• $816,000 to hire additional police officers and fund the Police Department
• $530,000 to assist in financing a new Public Works garage facility
• $450,000 for expansion of Emergency Medical Services
• $295,200 for the Bondsville, Three Rivers and Thorndike Fire Districts
• $250,000 for the Department of Public Works
• $168,800 to the Inspectional Services Department to hire building inspectors and a health inspector and clerk
Additionally, Mohegan Sun Massachusetts is expected to generate an estimated $900,000 to $1.4 million in annual hotel occupancy taxes and an additional $225,000 in annual meals taxes to the Town.
