The Pennsylvania Gaming Control Board awarded Philadelphia's second casino license to the Live! Hotel and Casino on Tuesday. The board cited the potential traffic generated by attendees of sporting events at South Philadelphia's stadium complex, the lower (i.e. more realistic) revenue projections for Live!, and the lack of deficit funding that would be involved in financing the project as reasons for choosing Live!.
The board also questioned whether casino-goers would utilize public transit to the degree that the proposals for two Center City based casinos envisioned.
From a gambling standpoint, the board may well be right. I know 0 about the economics of casinos. But from every other potential vantage point, the decision is nothing short of moronic.
Although city officials expressed support after the board's decision, citing the semi-finality after years of tumult (opponents are sure to take the matter to court) and the potential for job creation, this decision is terrible for the city.
As I blogged about in September, the two Center City sites offered potential to redevelop blighted stretches. They might have served as anchors for local business development and had salutary effects that had little to do with gaming.
Instead, the state board plopped a big box casino down in an area that hardly needs additional traffic. As anyone who has ever attended an event at the stadium complex knows, when one or two events bring 65,000 people to the area, the local roadways quickly become a parking lot.
Though the board expressed concern about traffic in Center City, it said little about its rationale for passing up the potential development opportunity. It seems as though it focused entirely on the potential for Live! to succeed as a gambling venue, which may well be its charge, but which is colossally short sighted from a planning standpoint. It also may be foolish given the growing number of Northeastern casinos. A project that offered other salutary benefits, and relied less on gaming would have been less susceptible to a downturn caused by declining gaming revenues.
The board's decision is also emblematic of a far larger problem. In too many areas, state run commissions and boards control Philadelphia. The state run School Reform Commission (roughly as popular as Ebola or the Dallas Cowboys in Philadelphia) runs Philadelphia's schools, the state run Philadelphia Parking Authority (even less popular than the School Reform Commission if that is possible) controls street parking and garages throughout the city, and now the Gaming Control Board made the decision about a major potential development for the second time.
That doesn't even count the ways in which the state legislature frequently hamstrings the city from enacting popular legislation that might be beneficial to Philadelphia (Philadelphia had to sue the state this month over a new law that gives organizations such as the National Rifle Association the right to sue cities over local firearm ordinances. This new law stemmed from another state law that prevents municipalities like Philadelphia from having stricter guns laws than the state).
As a 2011 piece on the Parking Authority explains, " Why would a state senator from Jefferson County, Pennsylvania care about parking spaces in Philadelphia? He probably doesn’t, yet he has more say over who runs the Philadelphia Parking Authority than the mayor of Philadelphia does."
The PPA is perhaps the most egregious example of state control in Philadelphia, because the state took over the Authority in 2001 to benefit Republican patronage (its director Vince Fenerty, is a former Republican ward leader). The state also took over Philadelphia's schools in 2001, but for more legitimate reasons related to financial difficulties.
For the Republican controlled legislature to allow these state run entities to control major elements of city governance reeks of rank hypocrisy (and Republicans controlled the legislature in 2001 when the state took over the schools and the PPA). After all, Republicans purport to be the party of smaller government, and state and local control.
The problem with these state run entities is that they do not have to answer to the citizenry for any of their decisions. No wonder they are free to do countless things that raise the ire of Philadelphians, and that, arguably, hurt the city. In so much as they answer to anyone, it is to state legislators and their constituents, who have fundamentally different needs and goals than Philadelphia and Philadelphians.
Now I understand that the counterargument might be that the state provides massive funding to Philadelphia's schools, and that gambling requires uniform statewide regulation. Nonetheless, the problem remains that there is no way to force these government agencies to prioritize the good of the city, and in fact, sometimes their charge requires doing the opposite of what is good for Philadelphia.
I'll freely admit that Philadelphia's local officials don't have a seller record of governing in the city's best interest. But at least they run the risk that at some point angry reform minded voters might end their careers if they ignore the public will.
By contrast, why should a member of the Gaming Control Board appointed by Pennsylvania State Senate President Pro Tempe Joe Scarnati, who represents Cameron, Clearfield, Clinton, Elk, Jefferson, Mckean, Potter and Tioga Counties, none of which is close to Philadelphia, care about what casino offers the best development prospects for Philadelphia? (The governor and the legislative leaders of the Democratic and Republican caucuses in the State House and State Senate appoint the members of the Gaming Control Board).
Given that none of the legislative leaders making appointments are from Philadelphia, and given that outgoing Governor Tom Corbett is a Republican, who received minimal electoral support in Philadelphia, these board members have little practical incentive to heed the wishes of local officials or the public.
Indeed, Mayor Michael Nutter favored one of the two Center City casino sites, arguing that they could have spurred "real revitalization" in those neighborhoods. Not surprisingly, the mayor prioritizes real revitalization in neighborhoods in his city, because that is his job.
The mission statement for the Gaming Control Board, by contrast, states that it will "protect the interest of the public by ensuring the integrity of legalized gaming through the strict enforcement of the law and regulations, the licensing of qualified individuals and entities, and fulfilling the objectives of limited gaming in the Commonwealth to deliver a significant source of revenue, assist the horse racing industry, provide broad economic opportunities and enhance tourism."
Nutter and the members of the Board have fundamentally different charges, and they answer to different bosses. The same can be said for the PPA and SRC.
When considering the casino proposals, the Gaming Control Board had to consider gaming revenue (and the revenue that gaming would produce for the state), the ability of the casino to compete with Pennsylvania's other casinos, as well as the plethora of casinos in neighboring states, for regional business, it's ability to draw gamblers, etc. They did not have to consider which casino proposal promised the most potential benefit for the city.
By contrast, Nutter and other city officials did precisely that, which involved considering factors such as the impact from spurring other development in an area, creating an entertainment destination, even if it produced less gambling revenue, improving infrastructure, adding conveniently located hotel rooms that helped local convention business, etc.
City officials also think about the good of the city writ large. From their perspective, Live!'s close proximity to major highways, which might bring convenience seeking gamblers to the casino, might be less important, because those gamblers are probably less likely to explore the rest of the city (especially given that Live! will be several miles from Center City). For the Gaming Board, that factor made the site more attractive.
In reality, almost no person familiar with the needs and realities of Philadelphia would have selected the Live! proposal. But, as the Gaming Board showed in green lighting the Sugarhouse casino in 2006, which is cut off from any neighborhood, and basically only appeals to gamblers (Sugarhouse is building an expansion, which may add attractions for non-gamblers, but that remains to be seen), they don't care about urban development or taking advantage of gaming licenses to benefit the city.
One could similarly analyze many of the decisions by the other state entities and explain how city officials might have looked at them differently.
The bottom line is that state officials or state commissions are not the parties best equipped to consider Philadelphia's needs and to do the the things necessary to continue the city's growth. It might be one thing if the state took control of city institutions in order to provide better regional cohesion and regional funding/ownership of public institutions (like schools). But just to run things because of some presumed superior competence (or in the case of the PPA no clear, discernible reason), is wrong, and hurts Philadelphia and Philadelphians.
Local control should be restored, at which point we can focus on holding local officials accountable when they don't act in the public's interest.