Boston, Wynn Come to Terms on Surrounding Community Agreement

In the end, it was Mayor Martin Walsh and Wynn CEO Steve Wynn who got down to the nitty gritty – successfully negotiating directly with one another all last week on a Surrounding Community Agreement (SCA) for Boston that has some accommodations for Charlestown and Boston, including mitigation money for traffic and direct mitigation payments of around $2 million annually.

There are also some pieces of good news for Everett with the prospect of removing the once-contentious Boston Water & Sewer Commission (BWSC) sludge plant on Alford Street. However, Mayor Carlo DeMaria said the agreement between the two parties is better news for Everett in that it allows the casino project to move forward unfettered, as Boston agreed to drop all lawsuits and appeals.

The agreement has to be approved by the Massachusetts Gaming Commission (MGC) before it becomes official, and that could come as soon as later this week.

The agreement announcement came just before 8 p.m. on Wednesday night, Jan. 27, after reports had been fluttering around since last Monday morning that an agreement was in the works between the two one-time enemies.

The overall agreement totals to $368 million in benefits to Boston, with $68 million in mitigation and traffic funds, $20 million annually for local businesses over 15 years and the potential to create a new open space park on the waterfront where the BWSC Materials Handling Facility.

“This agreement represents the largest community benefit to date offered by Wynn Resorts or the Massachusetts Gaming Commission to the City of Boston,” read a release from Boston. “The Surrounding Community Agreement was negotiated directly between Mayor Walsh and Wynn Resorts Chairman and CEO Steve Wynn.”

For Charlestown and Everett, the greatest feature will include significant commitments for traffic in Sullivan Square and Charlestown. Wynn has agreed to spend $25 million over 10 years for Sullivan Square infrastructure improvements. Meanwhile, they’ve also committed to $11 million in traffic mitigation for Charlestown in general.

Another $250,000 is to go towards a Regional Working Group looking at a long-term fix for Sullivan Square.

Most of those amenities are not new and Wynn had already agreed to them as a condition to its MGC license 18 months ago. At that time, Wynn agreed to contribute $25 million to a long-term fix in Sullivan Square, with more money coming if traffic counts exceeded projections. Another $10 million had been committed to the MGC for short-term fixes in Sullivan Square.

So, most of the Sullivan Square commitments had already been made.

It was not immediately certain what the $11 million for Charlestown traffic would entail – whether it was part of the $10 million short-term fix pot of money or some new pot of money.

Boston did allow Wynn to be released from an MGC traffic mitigation clause that required millions of addition monies to be paid if traffic counts on Rutherford Avenue and Sullivan Square exceeded projections. That would have worked on a per-car fee for every vehicle over the projection, but Boston dropped that requirement for Wynn – with Wynn arguing for some time that there was no way to tell if the increased traffic was going to their resort or to some other destination.

The one absolutely new feature was the removal of the BWSC Materials Handling facility with the possibility of making it an open space park as well.

It was uncertain how the new agreement would gel with the MGC stipulations on the Wynn license, as there were additional requirements in the MGC portion not immediately highlighted in the Boston agreement. That was expected to be ironed out in an upcoming meeting of the MGC, which could happen this Thursday.

In regards to Boston’s lawsuits, a condition of the agreement is that all lawsuits will be dropped. It appeared that the agreement included $1 million in “professional expenses,” likely to be enough to cover the cost of negotiating the agreement, but not enough to cover the millions of dollars paid in legal fees over the last year to outside attorneys representing Boston in the litigation.

The specific highlights of the agreement include:

  • $31 million over 15 years for community impact (just over $2 million per year);
  • $25 million over 10 years for Sullivan Square infrastructure improvements;
  • $11 million for traffic mitigation in Charlestown;
  • $250,000 for a Regional Working Group on a long-term fix for Sullivan Square;
  • Good faith effort to purchase $20 million annually over 15 years from Boston businesses; and,
  • $1 million for reimbursement of professional expenses.
  • The agreement states further commitments by Wynn Resorts for traffic improvements, including Transportation Demand Management measures, a transportation monitoring program and additional mitigation measures if operational deficiencies are revealed.
  • In addition, Wynn Resorts has agreed to work with the City of Boston to explore moving the Boston Water and Sewer Commission’s Materials Handling Facility with the goal of creating public open space along the waterfront in Charlestown.

“Our efforts over the past two years have been to protect the people of Boston and ensure the neighborhood of Charlestown is treated fairly,” Mayor Walsh said. “Residents have been trying for years for a solution for traffic congestion in Sullivan Square and Rutherford Avenue, and we must work together to improve local transportation infrastructure. I offered to keep an open line of communication throughout this process and I thank Steve Wynn for coming back to the table to listen to Boston’s needs.”

Wynn Resorts issued a statement following the agreement, saying they are ready for a new chapter in the book on their often-rocky relationship with Boston.

“We are eager to turn the page in our relationship with the City of Boston and begin a new chapter that will culminate with a beautiful, five-star resort overlooking Boston Harbor,” read the statement. “Subject to approval by the Massachusetts Gaming Commission, our agreement with Boston will unlock economic development and jobs for the entire region. Both Wynn Everett and Mayor Walsh wanted the same outcomes:  to bring new jobs, economic growth and a globally respected resort company to the region, while doing what’s best for the people of Massachusetts. Our agreement hits all these marks in very meaningful ways.”

Mayor Carlo DeMaria was happy to see that the two parties finally reached an accord, something he has called Boston to do for months.

“I want to thank Mayor Walsh for personally meeting with Mr. Wynn and negotiating a strong agreement for the city of Boston,” said DeMaria. “This agreement means that the $1.7 billion resort-casino project in Everett will be able to move forward. This is another positive step for the City of Everett and the entire region. Wynn Everett is the largest economic development project in the Northeast, and will have huge economic benefits for our residents and for the Commonwealth. This project has always been about jobs for Everett residents and jobs for residents of the entire greater Boston region. Wynn Everett is moving forward, that much is clear. I am committed to continuing to work with Mayor Walsh and Boston to help realize the enormous benefits of this project for all our residents.”

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