Proposed Encore Boston Harbor expansion raises legal concerns among Massachusetts commissioners

Massachusetts gaming regulators are revisiting the 2013 referendum through which Everett voters backed the development of the Encore Boston Harbor casino amid legal concerns about where gambling is allowed. The effort comes as casino officials look to expand the property’s gaming offerings into a new development across the street from the existing venue.

According to the State House News Service, the Massachusetts Gaming Commission is seeking to clear up exactly what it was that city residents approved nine years ago. In the meantime, Encore's parent company Wynn Resorts is seeking to construct a new building across Broadway from its resort to host a dedicated poker room, a second sports betting parlor, a new nightclub, a theater, a parking garage, and more.

Commissioners ruled back in March that a previous draft of Wynn’s proposal, which did not include any gaming areas, would not be part of the official gaming establishment. Thus, the additional space would not fall under commission jurisdiction or oversight – an outcome Encore Boston Harbor had lobbied for.

Wynn has since changed its plans for the expansion, and the company now wants the space to include both casino gaming and sports betting, which would indeed require the venue to be regulated by the state’s Gaming Commission. But this proposal moves Encore Boston Harbor into uncharted territory, not only for the company but for regulators as well.

The state’s casino gambling law is “silent” when it comes to expansion of gaming operations beyond the footprint of the existing gaming establishment, commission general counsel Todd Grossman said last week, as reported by SHNS. The proposed move is thus causing legal confusion among commissioners, as they consider the implications of the expansion.

When the earlier proposal came in front of the commission, one of the issues raised at that time was whether or not the city-wide referendum conducted in 2013 would be sufficient to cover the additional property. However, because the commission determined that the proposal was not part of the gaming establishment, that question never needed to be answered.

Now that scenario has changed. Because the new proposal would need to be part of the gaming establishment to operate, “this question now does need to be answered,” commented on Wednesday Joe Delaney, the commission’s chief of community affairs.

The MGC has to answer whether the language of 2013’s referendum authorized casino gaming at just the location specified on the ballot or whether voters approved Wynn’s casino license generally. The question before voters nearly a decade ago was: “Shall the City of Everett permit the operation of a gaming establishment licensed by the Massachusetts Gaming Commission to be located at the property located on Horizon Way (off ‘Lower Broadway’) in Everett, formerly known as the Monsanto Chemical Site?”

While the state’s gaming law required that the referendum language included a description of the proposed location, another section of the law also includes a line that says that if a majority of voters are in favor of the referendum, “the host community shall be taken to have voted in favor of the applicant’s license,” adds the State House News Service.

The analysis turns on whether commissioners will interpret the law to mean that voters approved of Wynn’s license generally, or view the inclusion of the specific parcel on the ballot as an indication that the vote approved that specific land. 

According to Tony Starr, an attorney at Mintz Levin who represents Wynn Resorts, the first recital in the host community agreement between Wynn and the city of Everett contemplates that the company may undertake new construction on property other than the current Encore Boston Harbor site.

The recital in the agreement says: “Wynn, directly or through an affiliate, has or will acquire land and options to acquire land in the City in and around the area depicted in Exhibit A (the ‘Project Site’).” Exhibit A was a map of the site that now hosts Encore Boston Harbor.

While commissioners, lawyers and representatives from both the city of Everett and Wynn discussed the issue at length last Wednesday, the MGC has not yet made a decision on the company’s proposal. The commission has tasked Wynn with preparing a presentation showing the boundaries of the former Monsanto chemical site for the next hearing.