A Fair Bet!

We have read so much about the casinos coming to Philadelphia over the past decade that our eyes tend to glaze over with each new story.  Here’s one you can take to the bank: there will be gambling on the river in the City, and at least onecasino will likely be in operation within two years!*

After years of agonizing, the legislature finally authorized gambling in the State and created a commission which accepted applications; and after a vetting process which ran for a couple of years, the commission awarded two licenses on the Delaware River near the Ben Franklin Bridge, one a few blocks north (Sugar House) and the other a few blocks south (Foxwood).  A storm of protest erupted in the adjacent neighborhoods, and any number of lawsuits and other (i.e., political) means were employed to revoke the authority.  In every effort, the protestants met with defeat and frustration. The City councilmen representing the affected districts not surprisingly sided with the neighborhoods, all to no avail.

Finally, having run out of options, under court order the City (during the final days of the Street administration) issued a building permit to both developers.  The permits were challenged; the Supreme Court of Pennsylvania late in 2007 upheld the Sugar House permit and in April 2008 upheld the Foxwood permit.  With the exception of the riparian rights issue (discussed below), this should be the end of the line for the objectors.  Given the enormous success of the casinos in Bensalem and Chester, each of which is reporting daily gross receipts of $10,000,000 (think of that!), it is a very safe bet that the developers will work toward completion at the earliest possible date.

The one issue that is yet to be determined involves the application of Sugar House to build a portion of its complex in the Delaware River bed.  In February, 2008, Pennsylvania adopted an act which required anyone proposing to developriparian land (which is the submerged land adjacent to a shoreline) in the state to obtain a permit first from the State. Mayor Michael Nutter, who assumed his office in January 2008, has revoked Sugar House’s permit to build on the ground that it was issued without proper review, and a number of State Senators have appealed on the ground that the riparian license has not been granted.  The City’s revocation seems destined to fail because of earlier Supreme Court decisions, and the riparian permit issue is due to be argued before the Supreme Court in either April or May 2008.  Interestingly, the act which authorized gambling in the State mandates that any appeals relating to issuance of permits must be taken directly to the Supreme Court, thereby eliminating what could be years of delay as they might have had to wend their way through the lower courts.

Sugar House apparently has alternative plans which would eliminate the riparian permit issue (by not building in the land submerged by the River); if it is unsuccessful in the pending riparian land appeal, it is a near-certainty that it will still be built.  Meanwhile, you can expect the dirt to fly on the Foxwood site momentarily.

The $64 billion question: what effect will all of this have ultimately on Atlantic City whose revenues are already sagging with the casinos in Bensalem and Chester?

— Ken Butera

*Whoops!  Just as this article goes to press, yet another petition to allow an appeal challenging the zoning of the projects has been filed by the city council.  It is doubtful the appeal will be allowed by the Supreme Court, but given the history of this drama, who knows?

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