By Josh Resnek
The mayor is trying to reassure residents and the business community that Wynn Resorts will not be selling out, as reported in the national media last reverberating around the city mightily this week.
It appears to have caught city hall by surprise.
Wynn CEO Matt Maddox announced last Friday that Wynn Resorts and MGM Resorts are in“preliminary” discussions for the sale of Encore Boston Harbor. What exactly is going on has been called a “high stakes mystery” by the Boston Globe.
“It’s not going to happen,” Everett Mayor Carlo DeMaria said on Monday of a potential sale. “I don’t think I would have done a host agreement with anyone else. And now they’re going to sell it? No.”
DeMaria’s spokesman, George Regan, stated that city residents voted to approve a deal with Wynn Resorts and Wynn Resorts alone.
“The mayor is not going to be pushed around,” Regan said. “He has veto power and he will exercise it.”The mayor’s veto power, and how he might actually exercise it, is subject to legal interpretation. For now, the mayor wants us to believe he can force Wynn Resorts to stay or refuse another company if the place is sold.Wynn’s desire to get out of Everett and Massachusetts is a major development with potentially grave economic and political impact for the city.
“Where there is smoke there is fire,” said a casino gaming source who wished to remain unnamed.“The mayor has hired George Regan to speak for him and the city. He is a powerful crisis manager. You don’t hire Regan unless you are in crisis. That should tell us all something right there,” added the source.As for the mayor being pushed around he has already been jettisoned by Maddox who apparently considers the mayor a “liability.”
Also, revelations of the mayor’s relationship with the FBI, the difficulties with the land and the law suits, and the claims that the mayor received a kickback on the sale of the land to Wynn Resorts, has apparently stopped cell-phone conversations with Maddox. There is a reluctance among high up Wynn Resorts executives to take the mayor into their confidence or to speak with him on the phone.
In addition, it is also believed that the Wynn Resorts executive staff in Everett had no idea what Maddox has been doing to possibly sell the project. Whether or not the place is opening on June 23 and whether or not the 4 a.m. liquor license Wynn Resorts is requesting will be granted are major questions taking a back seat to the new reality –is the place being sold?
If it is sold, then who buys it and under what conditions?Reports about the particulars seem to be in shorter supply than the tepid quotes of the governor, the speaker of the house and the mayor of Everett all combined.According to the Gaming Laws, no casino company operating here an hold two licenses.If MGM wants to buy Encore, then it needs to sell MGM Springfield.Such a series of transactions would exhaust and bury the Massachusetts Gaming Commission’s ability to handle them.Wynn Resorts abandoning Everett and MGM coming in after abandoning Springfield, well, how does that work, many observers are left to wonder?What happens to all the promises made and promises broken by such a scenario?
Chief among the burning questions which remained unanswered this week is this: will Wynn Resorts pay the fine and admit to the validity of the MGC’s findings?Will Matt Maddox do the same?Wynn owes a $35 million fine. Maddox owes $500,000 and must also hire a company to oversee his actions as CEO – something Maddox has bristled at.A Boston Globe columnist this week suggested that Maddox is rocking the boat because he’s wanting to show the MGC who the real boss is.
“Wynn Resorts is right now into renewing their licensing in Macau. A great deal of their profits come from the operation in Macau, and soon, from Japan. Wynn Resorts cannot risk a downside from the Boston settlement or repeated intrusions into their management scheme,” said the casino analyst.
Maddox has said he cannot allow anything to interfere with WynnResorts $20 billion value as a company.Some believe this is why he wants to be rid of Boston and its regulations, lawsuits and politics. By mid-week, the situation remained in flux with rumors of a sale, of an opening put off, of law suits needing to be settled, all weighing heavily on the minds of everyone involved in this project.Hard Rock Café may be a suitor for the MGM Casino in Springfield, according to a source close to the negotiations.
“That way, MGM could take over the Encore property…but all of this would take months…what a mess this has turned into,” said the source.