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Saturday, January 10, 2004
State OKs new license for raceway
Copyright © 2004 Blethen Maine Newspapers Inc. | ||||||||||||||
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AUGUSTA — The Maine Harness Racing Commission voted unanimously Friday to grant a conditional license to Bangor Historic Track once 100 percent of the stock is transferred to Penn National Gaming. Penn National plans to acquire full ownership no later than Wednesday, triggering a quick exit for Las Vegas racino developer Shawn Scott, who has agreed to turn over his stock by that date. The commission's vote means slot machines could be installed at Bangor Raceway late next month under the state racino law approved by voters in November. It also brought to a close a contentious public hearing on whether Scott was suitable to operate a racino in Maine. The license is contingent on Penn National proving it is a suitable licensee with the resources to offer racing. The company will undergo the same rigorous background check done on Scott and his associates. There's no time frame, but a Penn National spokesman believes the process can be expedited. Scott and Penn National announced the agreement in principle to change owners at Friday's racing commission meeting. They expect to have it in writing by Monday. The deal quickly came under attack from Gov. John Baldacci, a racino opponent who had urged the commission to postpone action until the Legislature can vote on Baldacci's plan to strengthen state oversight of the racino industry. Lee Umphrey, Baldacci's spokesman, said the arrangement worked out Friday "smacks of another back-room deal." Eric Schippers, a vice president of Penn National, said after Friday's meeting that his company would like to have a Bangor racino "up and running as soon as is appropriate." But officials at Penn National "fully embrace the governor's call for strict regulation" of the racino industry before any slots become operational, he said. "It is not our intention to rush the situation," Schippers said. "We want this to be a thorough, exhaustive and transparent process." The deal won cautious praise from the city attorney in Bangor and a more glowing endorsement from Bill Hathaway, a leader of the Maine Harness Horsemen's Association, who said it ensures that harness racing will take place in Bangor this year. Schippers would not say when Penn National hopes to open a racino in Bangor, how many slots the company wants to install or how much Penn National is paying for Bangor Historic Track. Scott also refused to release the selling price, although Penn National will have to disclose that information eventually because it is a publicly traded company. The racino law allows tracks that hold harness-racing licenses to install slots if they got local approval in 2003. Unlike Scarborough Downs, which was unable to win approval from any of several communities in southern Maine, Scott got a green light from Bangor voters last June and signed a racino agreement with the city of Bangor, which owns the harness track there. Norman Heitmann III, the city solicitor in Bangor, said the City Council will have to review the changes before the city can pass judgment on them, but Heitmann told the commission the plan to tie a conditional license to a quick transfer of stock "seems acceptable." The council will meet at 3 p.m. today to discuss Friday's developments. The racino law takes effect Feb. 21, but Baldacci hopes the Legislature will pass tougher regulations before then. One change he is pushing would require a separate license for slots, instead of allowing any licensed harness track to install slot machines. If the Legislature fails to strengthen racino controls before then, the racino law enacted by voters will take effect, and Penn National's new harness license will give it the power to install slots in Bangor at that time. Schippers said Penn National has no intention of using such a loophole because the company wants to work with the governor, lawmakers, state regulators and Bangor officials. Umphrey, Baldacci's spokesman, said the governor was "disappointed on behalf of the people of Maine" that the commission approved a license before the Legislature could set up tougher racino controls. He said the commission's premature decision "shows the importance of having the strictest regulations possible," including a new regulatory board that Baldacci wants the Legislature to create to license and oversee racinos. "I think there will be a lot of scrutiny of what happened today, by the governor's legal counsel and others, to see that the people's interests are protected," Umphrey said. He said it makes good business sense for Penn National to claim that it wants to go slow and work with the governor and lawmakers in adopting tougher regulations because "they represent a new industry (in Maine) of questionable background." The ownership deal announced Friday afternoon capped an initially unproductive racing commission meeting in which confused commissioners wrestled with their desire to give someone a 2004 harness racing license for Bangor without knowing who, or how to go about it. Scott and Penn National confirmed Thursday that a sale was in the works, but they did not say then it would occur. "The problem is that you don't seem to be able to make a determination as to who owns the track," Ruth McNiff, an assistant attorney general and the hearing officer for the commission, said during the first phase of the meeting. That problem evaporated after a lengthy break, during which Scott and Penn National agreed to make the stock switch by Wednesday if the commission agreed to issue a license at that time. Henry Jackson, the commission's executive director, urged the commission to postpone a vote until after the stock transfer takes place next week, but lawyers for Scott and Penn National said that would not work, and the commission voted to automatically issue the conditional license once the transfer occurs. The Associated Press contributed to this report. Staff Writer Paul Carrier can be contacted at 622-7511 or at: pcarrier@pressherald.com
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