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Thursday, February 19, 2004
Court asked to reclaim Penn National license
Copyright © 2004 Blethen Maine Newspapers Inc. | ||||||
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Two Maine Indian tribes and the group Casinos No! want a state court to take back a conditional racing license awarded this week to the owner of Bangor Historic Track. The Passamaquoddy and Penobscot tribes and the anti-casino group filed separate lawsuits Wednesday in Penobscot County Superior Court. Each party asked the court to overturn decisions Tuesday by the Maine Harness Racing Commission that awarded Penn National Gaming a conditional racing license. The license is needed before a commercial track can install slot machines under a state law scheduled to go into effect Saturday. James Kilbreth, an attorney with Verrill & Dana who represents Casinos No!, said the law isn't clear about whether Penn National can install slot machines with a conditional license, or if it must first prove to the commission its suitability to operate the track. "We're asking the court to determine whether, without any kind of background check or suitability investigation, Penn National automatically gets a slot machine license," Kilbreth said. Eric Schippers, a spokesman for Penn National, said the tribes and Casinos No! went to court because the racing commission refused to let them participate in the licensing process. "We view the actions of the tribes and Casinos No! at the harness racing commission and their current legal efforts as completely self-serving and not at all in the interest of helping to revitalize the harness racing industry as supported by voters," Schippers said. The tribes and Casinos No! have separate aims. Casinos No!, an anti-gambling political action committee, campaigned against a state referendum last year that would have allowed the Passamaquoddy and Penobscot tribes to operate a casino in Maine. Last November, voters rejected the Indian casino question, 346,583 to 170,500. But they approved, 272,394 to 242,490, a referendum allowing slot machines at the state's commercial racetracks. The Passamaquoddy and Penobscot tribes now want to operate harness racing and slot machines at the city-owned track in Bangor. Casinos No! opposes slot machines at state racetracks. But both parties are asking the court to reverse racing commission decisions that denied them legal standing in the licensing process. And both want the court to examine whether the commission followed state law when handling license applications related to Bangor Historic Track, which was sold to Penn National during the process. Bangor Historic Track is a privately held company that leases the city-owned Bangor Raceway and conducts racing there. Shawn Scott, the Las Vegas-based developer who sponsored the racino referendum campaign, bought the operating company last year. He made arrangements in January to sell to Penn National when it appeared he might not pass a pre-licensing suitability check conducted by the racing commission. Penn National is a publicly traded company that owns or operates casinos, horse racing tracks and off-track betting facilities in seven states and Ontario, Canada. Based on estimates in an economic study touted by Scott, 1,500 slot machines at Bangor Raceway would generate $75.3 million in revenue annually. Penn National has avoided making any projections about earnings. The way the law is worded, the racino operator could keep 75 percent of gross slot machine revenues. A bill under debate in the Legislature would decrease the operator's share and increase the state's share. When Scott announced his intention to sell his racing company, the racing commission gave him until Jan. 16 to transfer 100 percent of the legal and equitable ownership of Bangor Historic Track stock to Penn National. Once the transfer occurred, the commission ordered Bangor Historic Track to file an amended application for a 2004 racing license. In exchange, the commission agreed to grant the company a conditional racing license. The conditional license was awarded Tuesday. Conditions include passing a commission's suitability check, and proving the track is physically ready for racing. Scott still has a financial interest in the sale of the track through his sale agreement with Penn National, said tribal attorney Richard "Dick" Spencer of Drummond Woodsum & MacMahon. "Our position is that they did not do a transfer of the equitable and legal ownership to Penn National, and that Shawn Scott is still in the deal as a creditor of Penn National," Spencer said. Staff Writer Grace Murphy can be contacted at 791-6383 or at:
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