Penguins Fans Experiencing Roller Coaster Ride with Casino License

This month has been a stressful roller coaster ride for those who have been keeping up with the Casino deal and Penguins arena news.

At the beginning of July, Don Barden was struggling to come up with the $10 million in late payments owed to contractors in order to continue work on the Majestic Star Casino after he was given a grace period extending to June 30th to become current on payments or construction would come to a stop. Construction on the casino began back in December with a strict schedule for the building to be completed by opening date set for mid-May 2009. Construction eventually stopped in early July due to the lack of Barden's funding and talk turned to his taking on Neil Bluhm's Walton Street Capital as a new equity partner which kept Governor Rendell optimistic that construction would quickly start up again on the North Shore but the State Gaming Control Board would need to approve Bluhm's investment.

The construction of the Penguins new arena is closely tied to the casino because part of Barden's agreement includes his promise that a share of casino profits will be put towards arena construction which began eariler this summer.

"That's something that no one will waive," Rendell said.

Although it's easy to understand why many Penguins fans would be nervous about the hurdles this casino deal has had to overcome along the way, it must be understood that for this very reason, the Penguins, Rendell, and the city of Allegheny County made sure to include precautions when drafting their arena deal in 2007 and planned for the possibility of losing the revenue promised by Barden; however, the bad news for us is that it would then become the responsibility of PA taxpayers to pay $225 million of the casino bill as a last resort. In my own humble opinion, I understand this would greatly raise our taxes, but I would rather pay to keep the Penguins in Pittsburgh then not to increase taxes and go through the anguish of what we went through trying to keep the Pens here in 2007 with an even greater possibility (an inevitability, perhaps) that they would be anywhere else but Pittsburgh.

County Chieft Executive Dan Onorato continues to remain optimistic and believes it will not come down to taxpayers making up the difference.

"The value of that license in Pittsburgh is still there," he said. "Somebody is going to want to operate this, even with the commitment of $7.5 million for 30 years."

Recently, Pittsburgh mayor Luke Ravenstahl has requested that the Gaming Control Board hold off on switching the license to Bluhm, or any new developer, until his concerns for slots tax revenue for the city are addressed.

"Every commitment that was made needs to be honored and lived up to, and we need to make sure that it's a reasonable expectation that this new group can do so," Ravenstahl said.

"I think we need to be careful and balance the need for, obviously, opening the casino as soon as we possibly can with the reality of, ''We have to get it right this time,' because we're in the pickle we're in now because we didn't get it right the first time," Ravenstahl said.

PA State Senators Jane Orie and Jim Ferlo have asked the Gaming Control Board to revoke Don Barden's license and start this entire proces over from the very start beginning from awarding a license as they previously did with Barden. They are opposed to the current license being transferred from Barden to a new developer. My question is, "why?" Why can't we just pick up where we left off -- employing the most convenient and efficient way instead of wasting more time and money starting the whole process over again from square one? However, I suppose I do not know enough of the facts and politics of this whole story to make such a simple rationalization like this.

"This is something you've got to put the brakes on," said Orie. "They've made an error in giving him this license. The last thing they can do is make an error like this."

"They need to go back to square 1 and begin all over again with due diligence and allow all interested parties to once again compete for this valuable license," said Ferlo. "It's clear that Mr. Barden does not deserve to hang onto this license. He's totally abrogated and reneged on every commitment he's made. So, it's time to pull that license."

"Mr. Barden and Mr. Bluhm filed this petition saying it's all confidential, everything from who are the partners, what is the financial arrangements," said Orie.

"The transparency is totally lacking," said Ferlo.

I suppose I can see the logic in the Senators' thinking. But, again, I don't know enough about how these things run to give an educated view on the matter. City Council President Doug Shields provides his own opinion - one that appears to be contadictory to Orie and Ferlo and along the lines of my own thinking (wouldn't those who are directly involved have more of a grasp on the issue than Senators who work in Harrisburg?).

"This is a vitally important issue. I would hope that our friends in Harrisburg would reach an accord, get to a point where this is totally resolved amicably and without having the license have to be reissued."

And reports have made mention of Dan Onorato's skepticism with changing the casino ownership.

“I think everybody in this room, everybody in this town, we must be skeptical now based on the history to this point,” Onorato said. “Not skeptical of Mr. Bluhm – skeptical of the process.”

“What I am going to demand is that the gaming board gives us a financially sound
owner who’s going to do and follow through on all of the commitments – that’s
the only thing I’m focusing on. If we get that, this region wins,” Onorato said.

What we can all agree upon is that the casino deal has turned out to be one big mess; and so, this saga continues; however, Penguins fans must remain confident in the fact that the Pittsburgh Penguins will get their new arena no matter what the result of who the developer or how the license is awarded. The Penguins will be playing in a new arena for the 2010-2011 season. Period.

[this blog post is based on articles posted on the WTAE-TV webpage]