Committee Hearing, June 13, 2007

COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON RULES - - - Room 400, City Hall Philadelphia, Pennsylvania Wednesday, June , 2007, 10:25 a.m. 7 - - - 8 9 10 Bill No's: 070006, 008, 010, 011, 012, 264, 391, 456, 458 - related to Commercial 11 Entertainment Districts. Full text of all bills contained within and attached hereto. 12 13 COUNCILMEMBERS PRESENT: Anna C. Verna, Chair Blondell Reynolds Brown Darrell L. Clarke William K. Greenlee Jack Kelly James F. Kenney Donna Reed Miller Brian J. O'Neill Daniel J. Savage - - - V A R A L L O Incorporated Litigation Support Specialists 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 6/13/07 Rules Committee - CED Legislation WITNESS Panel #1 - Administration Janice Woodcock, Executive Director..... Philadelphia City Planning Commission City Solicitor Romulo Diaz, Jr. ........ 26 Panel #2 - SugarHouse Reps. Bob Sheldon, President.................. 79 Dan Keating, Keating Construction Co. 86 Ian Cope, Cope-Linder Architects........ 90 Chuck Hardy, House Counsel.............. 103 Panel #3 - Foxwoods Rep. Wm. G. Schwartz, Esq., Obermeyer et al. 114 Panel #4 Stephen A. Wexler....................... 126 Central Del. Riverfront Advisory Group A.J. Thompson, Fishtown resident........ 132 Shawn Rairigh, NABR..................... 143 David Odell............................. 150 Green Party Transit Working Group Panel #5 Donna Tomlinson, Fishtown Resident...... 155 Founding member, Fishtown Neighbors Charlotte Levins, Fishtown Resident..... 158 Lauren Griffith, Fishtown Resident...... 162 Joe Rafter, N. Liberties restaurateur... 164 Panel #6 - Labor Reps. Pat Gillespie, Building Trades Council 166 Wade Stevens, Labors District Council 170 John Kane, Plumbers Local 690........... 173 Gene Blagman, Philadelphia FOP.......... 174 3 6/13/07 Rules Committee - CED Legislation (Witness list cont'd.) Panel #6 Katie Recker, Esq., Fishtown Neighbors 180 J. Lewis, No. Libs. Neighborhood Assoc. 189 Tully Speaker, Logan Square N. Assoc. 194 Paul Boni, Society Hill Resident........ 198 Panel #7 Jeff Rush, DRNA......................... 206 Professor Robert Goodman................ 213 Hampshire College, Amherst, Mass. Professor Fred Murphy................... 243 Business School of Temple University Panel #8 Dolores Griffith, Fishtown Action....... 261 MaryAnne Warrington, Fishtown Resident 263 Wil Rojas, Fishtown Resident............ 267 Eric Rudy, Fishtown Resident............ 272 Panel #9 Chuck Valentine, Fishtown Resident...... 281 Joanne Sherman, Fishtown Resident....... 292 Charlie Hocker, Fishtown Resident....... 297 Panel #10 - Clergy Pastor Mary Miller...................... 300 Kensington Old Brick United Methodist Reverend Dick Ullman, Episcopal priest 309 Reverend D. Joy Segal, Rector........... 316 Gloria Dei Old Swedes' Church. 4 6/13/07 Rules Committee - CED Legislation (Witness list cont'd.) Panel #11 Delilah Winder, Chairperson............. 322 African-American Chamber of Commerce. Julie Wong, President................... 326 Asian Chamber of Commerce. Bob Nelson, President, Philadelphia OIC 327 Panel #12 Paul Kimport, local business owner...... 352 Arrone Dascal, " " " ...... 355 Frank Maimone, " " " ...... 357 Mike Seidenberg, Republican candidate... 374 Philadelphia 1st District Council Janine Missaoui, Harrowgate resident.... 383 Panel #13 Deb Diamond, GPTMC...................... 391 Ed Grose, Gr. Philadelphia Hotel Assoc. 397 Panel #14 Jim Paylor, Int'l Longshoremen's Assoc. 405 Jethro Heiko, Casino-Free Philadelphia 429 Daniel Hunter, " " " 442 Michael McGettigan, resident............ 460 5 6/13/07 Rules Committee - CED Legislation (Council President Verna bangs gavel.)

We'v e had enough entertainment for the morning that's it. I'm asking everybody to please respect each other we're going to go through this. And, I am telling you, we are not going to have any interruptions. They wouldn't allow that in Washington, they wouldn't allow it in Harrisburg, and I don't know why we should allow it here. So I am asking, please have respect for each other. This is a public hearing of the Committee on Rules. I would ask Mr. McPherson to please read the bills before us this morning. MR. McPHERSON: Bill No. 21 070006, an ordinance amending Section 22 14-1605 of the Philadelphia Code, entitled "Regulated Uses," by adding licensed gaming facilities as a regulated use, all under certain terms 6 6/13/07 Rules Committee - CED Legislation and conditions. Bill No. 070008, an ordinance 4 amending Chapter 14-400 of the Philadelphia Code, entitled "Commercial Entertainment District," by deleting the provisions authorizing the City Planning Commission to approve temporary facilities; by removing licensed gaming facilities and offtrack betting facilities as permitted uses; and by deleting any provision that may undermine Philadelphia local zoning controls, all under certain terms and conditions. Bill No. 070010, an ordinance 17 amending Chapter 14-400 of the Philadelphia Code, entitled "Commercial Entertainment Districts," by prohibiting districts within one mile of one another, providing additional restrictions for gross floor area, open area, and waterfront setback requirements; and providing for additional signage controls, all under 7 6/13/07 Rules Committee - CED Legislation certain conditions. Bill No. 070011, an ordinance 4 amending Section 14-1600 of the Philadelphia Code, entitled "Miscellaneous," by adding a new section entitled "Prohibition on Licensed Gaming Facilities," prohibiting the erection, construction, alteration, or use of licensed gaming facilities and providing that no 12 variance may be granted from such prohibitions, all under certain conditions. Bill No. 070012, an ordinance 16 amending Chapter 14-400 of the Philadelphia Code, entitled "Commercial Entertainment District (CED)," by providing that no ordinance designating a Commercial Entertainment District may be enacted unless a Neighborhood Improvement District has first been created that includes within its service area the proposed commercial entertainment district, all under 8 6/13/07 Rules Committee - CED Legislation certain terms and conditions. Bill No. 070264, an ordinance 4 amending Section 14-1624 of the Philadelphia Code, entitled "North Delaware Avenue Area special district controls," by changing the title and expanding the boundaries to include the area generally bounded by Oregon Avenue, Front Street, the Delaware River, and Spring Garden Street, all under certain terms and conditions. Bill No. 070391, an ordinance 14 amending Chapter 14-1600 of the Philadelphia Code, entitled "Miscellaneous," by adding a new section entitled "Prohibited Locations for Licensed Gaming Facilities," all under certain terms and conditions. Bill No. 070456, an ordinance 21 to amend the Philadelphia Zoning Maps by changing the zoning designation of certain areas of land located within an area bounded by Delaware, Shackamaxon Street (extended), the Delaware River, 9 6/13/07 Rules Committee - CED Legislation and Ellen Street (extended); and making certain designations relating to gross floor area, height regulations, and off-street parking; and providing that provisions relating to the Commercial Entertainment District shall control over certain other provisions, all under certain terms and conditions. Bill No. 070458, an ordinance 11 approving the planning of development for a Commercial Entertainment District in an area generally bounded by Delaware River, Shackamaxon Street (extended), the Delaware River, and Ellen Street.

Than k you. Before we begin our hearing this morning, I would like to make announcement as to how the Rules Committee will proceed today. The committee will first hear testimony from persons who wish to testify on any of the bills scheduled 10 6/13/07 Rules Committee - CED Legislation for hearing. Once that hearing concludes, a meeting of the Rules Committee will be convened, if necessary, for the sole purposes of adopting amendments to the bills. However, all of the bills being heard today, whether amended or not, will be held in committee. The committee will not take any action today to report any bills from committee. That means all of the bills will remain in committee over the summer. Are there any questions from members of the committee? (No questions.) (Applause.)

Seeing none -- (Applause and cheering continue.) (Council President Verna bangs gavel.)

11 6/13/07 Rules Committee - CED Legislation Please, we have a very lengthy list. We would like to hear from everybody who would like to be testifying today. And I am asking you again, there is no 6 reason to applaud or boo or express your feelings. So, please, I am begging you, please have respect for each other and for us. We're anxious so hear from you and what you think, so let's not delay this anymore than we have to. Councilman Ramos, did you want to be recognized?

Yes, ma'am. Thank you, Madam President. On Bill No. 070456, I would like to offer an amendment to that bill. I am not a member of the Rules Committee. I will ask graciously for one of the members of the Rules Committee to propose this amendment. This is adding Section 4 to Bill No. 070456 that reads: "The provision of this ordinance shall be 12 6/13/07 Rules Committee - CED Legislation effective only upon certification by the City Solicitor to the City Councilmembers for the 1st and 5th Districts and the executive director of Planning Commission, that a not-for-profit organization have been established for the purpose of providing community benefits in the neighborhood surrounding the Commercial Entertainment District; and that such organization will be capable of providing on an ongoing basis enhanced municipal services in that neighborhood." Madam President, this is very consistent with what has been happened in other Commercial Entertainment Districts where there is a Special Services District that will make sure that the community concerns are being addressed at all times. Those exist in Center City, University City, and the sports complex. They could very well exist if 13 6/13/07 Rules Committee - CED Legislation it is the will of the people and the people that will benefit, if that is the determination of the community and all of the interested parties and the SugarHouse site as well. So I offer this amendment to Bill No. 070456 for your consideration.

Than k you. Are you going to give that to a member of the committee?

The bill 13 has been circulated to the committee members.

Okay . Do all members have a copy of the amendment? Thank you. Okay. I would ask Mr. McPherson to please call the first witness. MR. McPHERSON: The Administration. (Witnesses come forward.) (Jeers.)

14 6/13/07 Rules Committee - CED Legislation Please. Good morning. Please identify yourself for the record and proceed with your testimony.

Good morning, Chairwoman Verna and members of the Rules Committee. I am Janice Woodcock, executive director of the Philadelphia City Planning Commission, and I am here to testify in Bills No. 070456 and 070458. I also request that Bill No. 13 070458 be amended to include the plan of development exhibit presented before you. Bill No. 070456 will rezone the proposed SugarHouse Casino site from a zoning designation of G2, general industrial, to a zoning designation of CED, Commercial Entertainment District. Bill No. 070458 approves the plan of development for the SugarHouse Casino to make way for the issuance of zoning and building permits for the 15 6/13/07 Rules Committee - CED Legislation project. I will first review the rezone proposal, describe the plan of development, and then outline the benefits of passage of this legislation that will be available to the city and the Commonwealth. In order for the SugarHouse Casino to proceed, the zoning of the site must be first reclassified. This bill proposes to rezone the site bounded by Delaware Avenue, Shackamaxon Street, the Delaware River, and Ellen Street for the Commercial Entertainment District zoning classification CED. The CED zoning is necessary for the construction of a casino. It is the only designation in Philadelphia that permits licensed gaming facilities and their accessory uses, such as hotels, restaurants, offtrack betting facilities, and theaters. Additionally, the rezone of this site to CED will remove the North Delaware 16 6/13/07 Rules Committee - CED Legislation Special Controls District, which would otherwise prohibit uses commonly associated to gaming such as restaurants, nightclubs, and entertainment of guests. By rezoning the site to CED, this bill sets forth specific development standards, including a parking reissue of four parking spaces for every five gaming positions, a building height limit of 300 feet and 30 stories, and overall density for the project of 400 percent, meaning that the building's floor area can equal up to four times the site area. The Commercial Entertainment District (CED) zoning district requires that for all sites zoned CED, a plan of development must be reviewed and approved by both the Philadelphia City Planning Commission and City Council. This plan of development is a master plan that sets out the layout, phasing, height, gross floor area uses, 17 6/13/07 Rules Committee - CED Legislation occupied area, the size and location of parking areas, signage, landscaping for every building located within the CED. It also includes the results of the PCPC design review relative to the building masting materials, quality and appearance, and impact of the development on the public environment. Bill No. 070458 would approve the plan of development as previously approved by the City Planning Commission. Before I highlight the positive results of the Planning Commission review, I want to mention why we have pursued this course for project review. While we did not control the Gaming Board site selection, the city does retain local zoning authority; therefore, the Administration worked diligently with casino operators to assist them in complying with local laws to address the traffic impacts, to 18 6/13/07 Rules Committee - CED Legislation provide employment opportunities for all Philadelphians. The alternative would have been a project imposed on the city without the benefit of local review. We believe that this alternate process would have been less responsive to local issues and concerns. For the physical aspects of this project, this local review has resulted in positive benefits to the City of Philadelphia at this location. In summary, I have seven points. Number 1. SugarHouse has agreed to construct traffic improvements to maintain the current level of service of 18 intersections impacted by the development and to evaluate traffic according to the standard at their expense at each stage of development.

This agreement is attached to this testimony as Attachment A. 2. SugarHouse has made strong 19 6/13/07 Rules Committee - CED Legislation a commitment, because of their corporate values and because of the importance of the environment, to the Administration to use leadership in environmental design building standards in the construction of the project and to include a green roof in the project. Specifically, SugarHouse has agreed to spend at least one million to make 60,000 square feet of its Phase 1 room into a green roof and will work to achieve leadership in environmental design, grading in initial and subsequent phases of development. This agreement is attached to the testimony as Attachment B. 3. The plan of development includes construction of the public riverfront area as well as access to it in the first phase of development. The public access points to the water will be inviting from all city streets. Intersections will be designed to minimize pedestrian and vehicle 20 6/13/07 Rules Committee - CED Legislation conflicts. The access points will be well lit, safe, secure, and clearly marked as open to the public. The public access components, including the walkway areas along the water, will allow public access 8 hours a day. The upkeep of the public 9 areas will be the responsibility of the 10 gaming operator. 11 4. SugarHouse will evaluate 12 the amount of parking prior to 13 proceeding with Phases 2 and 3, with 14 the results submitted to the Planning 15 Commission. The purpose of the parking 16 review will be for the allowance of the 17 reduction of the parking to avoid 18 overbuilding of parking that ends up 19 not being necessary. 20 5. The SugarHouse team 21 designed a site and building to enliven 22 the public environment around it, 23 strive for human scale, and improve the 24 pedestrian's experience -- and I have several points under here. 21 6/13/07 Rules Committee - CED Legislation Along Delaware Avenue, there will be a street wall feature lining the avenue that will exclude the points of ingress and egress, but it will elsewhere create visual interest at street level. In all phases of construction, blank walls visible from public streets or the waterfront promenade will receive special landscaping or other creative treatment until such time as subsequent phases are constructed. The parking garbage facade that faces the public walkway will receive special screening and lighting from to minimize the visual impact of the garage from adjacent sites and public walkways. Number 6. The development has been designed to allow future walkway connections which will be built on adjacent sites, and I might add here that the Planning Commission has been looking overall at how the trail will 22 6/13/07 Rules Committee - CED Legislation work along those adjacent sites. 7. SugarHouse will replace a major combined sewer overflow outfall on its site and expand this facility across Delaware Avenue to accelerate the city's efforts to address flooding in the residential areas near North Delaware. Solicitor Diaz will review additional provisions of the development agreement made possible through a concerted effort on the part of the SugarHouse team to address local and citywide concerns, including the efforts to address quality-of-life issues in the communities adjacent to the casino site. The last part of my testimony will review the economic benefits of approving this plan of development as part of successfully introducing gaming into the city. The construction and operation of two casinos in the city of 23 6/13/07 Rules Committee - CED Legislation Philadelphia has huge economic benefits. The Gaming Advisory Task Force the mayor commissioned two years ago concluded that the casinos will lead to between 945 and 1,071 temporary construction jobs paying between 30 and 34 million in wages, and another $1,703 to $1,922 in direct construction-related jobs, paying between 69 million and 78 million in wages.

The most important benefit will flow from the 7,000 to 12,000 permanent jobs we expect to see created, including between 1,445 to 1500 gaming operation jobs, between 2,100 and 4,600 new jobs in ancillary operations at the two Philadelphia casinos. Additionally, casinos will indirectly lead to between 3,900 and 6,400 new jobs from growth in other industries and local businesses across the economy that service casino patrons 24 6/13/07 Rules Committee - CED Legislation and businesses and that service casinos. These jobs and other opportunities created by the expansion of our Convention Center are responsible for more than 46 million in tax revenue to the city's five-year financial plan adopted by City Council. Benefits to the city do not stop here. Gaming will provide the city with more than million a year 13 in host fees and millions more in 14 taxes. The current five-year financial 15 plan includes 71 million in host fees 16 attributable to gaming revenues that 17 the city can use to support critical 18 city services such as police and public 19 safety, after-school programs, 20 increased funding for parks and 21 recreation. In addition, the 22 Philadelphia School District will 23 receive 5 million annually from the host fee payments casino operators must make under state law. 25 6/13/07 Rules Committee - CED Legislation That's over 100 million in total fees and tax revenues to the city over the next five years from the successful introduction of gaming into Philadelphia. )

Ther e will be silence or we will continue this and walk out. Now, we want to hear what the community has to say as well as everyone else, so I am asking you once again, there is no reason for you to personally be expressing your views the way you are. Please continue. And I'd like it to be as silent as it is right now. Please continue.

Thank you, Madam President. The City Planning Commission, at its meeting of May 22, 2007, 6/13/07 Rules Committee - CED Legislation considered and approved the plan of development for the SugarHouse Casino. Although the legislation approving the plan of development was introduced, the exhibit, the plan of development itself, was not formally filed. We promptly placed a copy on file with the clerk in addition to the publicly available copies at the Planning Commission, but the bill must be amended. At this time, I am requesting that the exhibit be included as an amendment to this bill. This concludes my testimony. I appreciate the opportunity to appear before you today and I would be pleased to answer any questions you have after the City Solicitor completes his testimony.

Than k you. Thank you very much. Good morning. CITY SOLICITOR DIAZ: Good morning, Madam President and members of 27 6/13/07 Rules Committee - CED Legislation the Rules Committee. I am City Solicitor Romulo Diaz, Jr. 's 07056 [sic] and 070458 related to the development of the SugarHouse Casino. I will focus my testimony on the joint efforts of the city and SugarHouse to negotiate a settlement agreement that provides tangible and substantial benefits to surrounding neighborhoods and citizens of Philadelphia. Such an agreement is intended, among other things, to protect those most directly affected by the SugarHouse development. It is also intended to provide certainty and enforceability as to the developer commitments. I am pleased to report that following direct negotiations involving the mayor and SugarHouse principals, SugarHouse and the city have reached an 28 6/13/07 Rules Committee - CED Legislation agreement in principle to settle disputes related to the opening of the SugarHouse Casino. This agreement builds on the process begun by the Philadelphia Gaming Advisory Task Force and discussions held over a year ago with all five applicants to the Philadelphia casino licenses. The city and SugarHouse will draft a final agreement in accordance with the agreement in principle. The agreement addresses quality-of-life issues important to the surrounding communities and a broader range of issues important to all Philadelphians. These issues include transportation, public safety, community reinvestment, economic opportunity, design quality, waterfront access, environmental issues, and local taxes. SugarHouse has worked cooperatively with the city for many months and, as such, some of the 29 6/13/07 Rules Committee - CED Legislation elements have already been incorporated into the plan of development before this committee. I commend SugarHouse for its demonstrated to our community and its good corporate citizenship. In order to inform the deliberations of City Council and this committee on the pending bills, I would like to summarize the key terms of the settlement agreement. No issue discussed with casino developers has been more contentious than local property tax abatements. It is fundamentally unfair to abate taxes for casinos when they were legalized by the state to allow for property tax and wage-tax relief. Indeed, the state legislation authorizing gaming was amended to expressly prohibit casinos from receiving state tax abatements. Accordingly, the Gaming Advisory Task Force recommended that Philadelphia eliminate local-property tax abatements for casinos. 30 6/13/07 Rules Committee - CED Legislation In the absence of a settlement, I foresaw the tax litigation was all but certain, and the city would have even greater difficulty and delay in achieving economic and non-economic concessions, which I will describe shortly, that we believe are necessary to make casinos work for the city and its residents. 8 million in tax-related revenues over an 11-year period that includes construction and the 10-year tax abatement period. 7 million in additional tax revenues to the city. This amount is over and above approximately $6 million in annual wage, business-privilege, and sales taxes that likely will be paid by 31 6/13/07 Rules Committee - CED Legislation SugarHouse, and does not include any of the fiscal benefits from spinoff economic activity, Convention Center expansion, host fees, and wage-tax cuts funded by gaming revenues. Transportation presents the biggest non-economic challenge from two licensed casinos sited on the Delaware riverfront. SugarHouse has committed to a plan for traffic improvements at locations designated by the city in the SugarHouse vicinity to ensure that these roads and intersections continue to function at least as well as they do today.

The study and engineering process is ongoing, but SugarHouse has made explicit commitments that you will find in their May 22, 2007, letter to the executive director of the Planning Commission. The provisions of this letter are part of the settlement agreement. Some of the SugarHouse 32 6/13/07 Rules Committee - CED Legislation transportation challenges require solutions that involve PennDOT and the already-planned designed and funded reconstruction of the Girard Avenue interchange. Similarly, there will have to be PennDOT-funded interim ramp constructed before the opening of SugarHouse to keep the neighborhood roads clear. The city and the Commonwealth are both committed to achieving that solution. The plan of development contains sufficient parking pursuant to the Commercial Entertainment District (CED) requirements and according to the city's parking experts. However, to avoid overbuilding of parking facilities, SugarHouse has agreed to meet with the Planning Commission to review whether parking facilities are fruitfully utilized and develop any mutually acceptable alterations before construction of parking begins in all 33 6/13/07 Rules Committee - CED Legislation future phases. SugarHouse has developed an economic opportunity plan mirroring in many respects but also significantly augmenting its diversity commitments to the State Gaming Control Board. Moreover, SugarHouse has committed to hiring Philadelphians and Philadelphia businesses and helping fund casino-specific training through Philadelphia OIC. We will report shortly to Council on the specifics of the EOP. I note that the Gaming Control Commission recently determined that kitchen-staff positions need not be licensed by the Gaming Control Board; thus, these positions as well as some vendor-employment opportunities are now potentially open to the ex-offender community. As recommended by the Gaming Advisory Task Force, the city will seek SugarHouse reinvestments in the 34 6/13/07 Rules Committee - CED Legislation immediate vicinity similar to those by the city's major sports franchises. Although negotiations with the immediate neighbors are ongoing, SugarHouse has agreed in concept to fund a Special Services District at the minimum level of $1 million annually, escalating over time, with startup funding during the construction period. As with the stadium district, this Special Services District is expected to provide enhanced municipal services in the area closest to the casino and to be governed by a board led by elected neighbor residents; thus, the neighborhood will choose whether to allocate the SugarHouse funding to litter patrols, additional tree-planting, improved sidewalks, or other community-enhancing features. SugarHouse has submitted to the city a plan of development that is fully compliant with the CED requirements. As Janice Woodcock has 35 6/13/07 Rules Committee - CED Legislation testified, it also reflects substantial design evolution resulting from a pre-submission design review process. SugarHouse is fully committed to helping make the Delaware Riverfront Trail a reality. The new development will provide for permanent outdoor access to a public promenade along the river, as detailed in the plan of development. Provisions of the agreement will require SugarHouse to build its promenade and public-access features during the initial construction. This portion of the trail will remain private property; thus, SugarHouse will provide all landscaping and maintenance for the property. SugarHouse has taken significant steps to a develop a casino that is environmentally responsible. Specifically, SugarHouse has agreed to spend at least $1 million to make at least 60,000 square feet of its Phase 36 1 6/13/07 Rules Committee - CED Legislation roof into a green roof and to undertake a similar design process for future phases.

This commitment represents approximately two-thirds of the greenable roof in Phase 1, as detailed in the May 22, 2007, letter to the executive director of the Planning Commission. SugarHouse also has agreed to -- both to retain a lead certification consultant and to share the consultant's reports with the Planning Commission staff. The Philadelphia Fire Department, as part of the Gaming Advisory Task Force process, determined that each casino would have to provide for a means to handle emergency medical calls from its own facilities. Accordingly, SugarHouse will have its own personnel trained as emergency medical technicians and will provide private ambulance services. SugarHouse also has agreed to 37 6/13/07 Rules Committee - CED Legislation provide ample onsite security that will coordinate with the Pennsylvania State Police, Which has jurisdiction over the gaming floor, to secure the property. There will be obligations that fall on the Philadelphia Police Department, and their efforts will be funded through the tax-settlement payments. SugarHouse. Has agreed to fund all infrastructure costs on its property, similar to other major development projects. This commitment includes the replacement of a major combined sewer overflow outfall at Laurel Street at a cost of $20 million. At the request of the Water Department, SugarHouse also has agreed to expand the new sewer and extend the expansion into and across Delaware Avenue. This additional work will be funded out of the settlement payments and will accelerate the city's efforts to address flooding in the residential 38 6/13/07 Rules Committee - CED Legislation areas near North Delaware Avenue. There are other important commitments. For example, SugarHouse has agreed to comply with, rather than challenge, the city's existing smoking ordinance, and we have agreed to work with SugarHouse to determine which areas, if any, qualify for exemptions under that law. SugarHouse is committed to use PGW natural gas to heat the casino and is in discussions on how to develop a combined cooling, heating, electrical plant that could lead to more revenue for PGW and shrink the casino's environmental footprint. And SugarHouse and the Administration have agreed to continue the streamlined development process that has worked efficiently to address local land use concerns. We believe that these commitments are appropriate and reasonable for any development of this 39 6/13/07 Rules Committee - CED Legislation size and complexity, but they are particularly notable in the context of an industry that will be paying approximately 50 percent of its revenues in state taxes and will be subject to comprehensive gaming regulation by the state. Moreover, the state tax revenues will fund the Convention Center expansion, city wage tax relief, $5 million in annual payments to the Philadelphia School District, and our annual host fee projected to reach $23 million annually in the current five-year plan. In that context, I am particularly proud of the good will demonstrated by both parties, which has made this settlement agreement in principle possible. We look forward to finalizing the settlement agreement soon. The settlement agreement, like the plan of development before you for approval, 40 6/13/07 Rules Committee - CED Legislation are steps that we hope will assure that the SugarHouse Casino will be developed in a manner that works for Philadelphia and its residents. That concludes my testimony. I would be pleased to answer any questions at this time. Thank you.

Than k you. Are there any questions from members of the committee? Councilman DiCicco, I see your light is on; did you want to be recognized?

Yes. Thank you. Thank you, Madam President. Good morning. (Exaggerated coughing sounds heard from balcony section of chambers.)

I'm not going to engage in calling of names or anything. Everyone knows my position when it comes to development in this 41 6/13/07 Rules Committee - CED Legislation Council. I've said this before and I'll just say it one more time; hopefully, it's the last time I have to say it: I'm pro-development, I've been pro-development. I supported the stadiums, I support the Convention Center expansion. Just yesterday, this Rules Committee reported out favorably a bill 12 that will set in motion a $500 million development at the corner of Broad and Washington Avenue. Not too long ago, this committee again reported out a bill that will set and stage the development of a 65-story high-rise condominium apartment complex development on Delaware Avenue. I can go on and on and on about the bills that not only I and this committee have supported over the past. We are pro-development. This is about saving neighborhoods; this isn't about whether or not we want casinos, 42 6/13/07 Rules Committee - CED Legislation at least as far as I'm concerned. I am not anti-casino; I'm just against the locations, and I've said that repeatedly, and I'm not going to talk about it. (Applause.)

I don't need the applause, and I appreciate it, but there are people in here from the building trades who have been twisting this thing from day one for political agendas to support what their needs are and not the needs of this community. So let me get on with my question to the Solicitor. In the community benefits agreement, there is a clause or a sentence in there regarding the term of the agreement, and it talks about termination and the process by which the CBA, the community benefits agreement, would be terminated, or could be terminated. Why do we need that in there? It's on , begins at the last 43 6/13/07 Rules Committee - CED Legislation sentence on . "The agreement shall automatically renew for additional one-year terms thereafter unless any one party hereto notifies the others in writing of its desire to terminate this agreement at least 60 days prior to the end of the initial term..." et cetera, et cetera. Why do we need a termination agreement, and what do you think would prompt SugarHouse to want to terminate the agreement? CITY SOLICITOR DIAZ: Councilman, in fact, you just mentioned a couple of points in response. First of all, this is not the city's document; this is SugarHouse's document. As I indicated in my prepared remarks, the discussions relative to the Special Services District are ongoing, have not been completed. The figures that I mention in connection with the payments that I 44 6/13/07 Rules Committee - CED Legislation understand have been agreed to have not yet been settled, but that's my understanding with regard to the figures that have been put on the table by SugarHouse to community representatives. I also note that in connection with the amendment that was recommended today for the committee's consideration, there would be the creation of the Special Services District that would to be certified as being in existence and capable of providing ongoing services in connection with this particular district. All of that would have to be in place before the CED rezoning approval would be effective. And so the purpose of my response to your question, Councilman, is to point out that we are not a party to this agreement. But clearly given the importance of protecting the nearby neighbors, the amendment that was 45 6/13/07 Rules Committee - CED Legislation offered today, I think, will require that this Special Services District negotiation be completed hopefully promptly and provide the kind of clarity that you're seeking. And so with that, I will stop.

Okay. I just -- it's disturbing for me to see that in there, so... CITY SOLICITOR DIAZ: Well, I think with regard to the termination date, we certainly, in connection with the city's direct negotiation with SugarHouse, have been in constant discussion and negotiation about elements like who has a right to terminate and on what grounds, et cetera. Clearly, that's an issue that needs to be addressed. It would appear to me -- and I'm speaking personally, but it would appear to me that so long as the SugarHouse Casino exists, the need for those supplemental municipal services 46 6/13/07 Rules Committee - CED Legislation will continue, the need to protect the nearby neighbors will continue. And I would understand that if the amendment offered today is adopted by this committee that there will be a requirement that that Special Services District continue regardless of what may be in a draft agreement at this stage relating to termination.

Thank you. Do you know whether any community members were a part of the discussion regarding this CBA? Do you have any knowledge of any community members being involved? CITY SOLICITOR DIAZ: I have not been involved directly in any of those discussions, Councilman, so I do not know.

Okay. My question to the Planning Commissioner -- good morning.

Good morning. 47 6/13/07 Rules Committee - CED Legislation

And thank you for being here. And you know I have the utmost respect for you; we've been working well since you've taken on this new position. In your testimony, you talk about the economic benefits. Most of what gaming is about has to do with disposable income. Most of the money that Philadelphia realizes by way of entertainment and cultural activities of either from people or the surrounding communities is based on what they have disposable income. They go to our theaters, they go to our restaurants, they do things that we have been promoting. That disposable income may shift to casinos. What happens to the economic benefits then -- the restaurants, the theaters, the concerts and all of those other activities? There's a minimal amount, there's just a finite amount of money 48 6/13/07 Rules Committee - CED Legislation that could be spent. What do you think the impact would be then?

Well, I will say that one of the things we know that it -- right now, the economic benefit is not being experienced by the Commonwealth of Pennsylvania; it just goes to neighboring areas. So we want to capture the economic activity that has been going outside of our borders up to this point.

Let me ask you a hypothetical question. You're a city planner. Assuming that the Commonwealth of Pennsylvania said to the City of Philadelphia, and did it the right way, that we were going to approve gaming for the Commonwealth of Pennsylvania but we were going to allow the city of Philadelphia and other municipalities to make a decision as to where these casinos would be placed. As a city planner, would you 49 6/13/07 Rules Committee - CED Legislation have chosen the waterfront as a site? And do you think that gaming is necessary for future development on the river? Your honest opinion.

We actually did a study -- the Administration did a study prior to the release of the decision of placing two casinos on the waterfront, and because the five sites suppose that at least --

Let me stop you, if I may, and I don't mean to be rude. Assuming we didn't have those five sites, 'cause those five sites were a result of many sites that were being --

I understand, I understand.

Forgettin g that there were any sites -- there were no sites even discussed. City of Philadelphia, you're going to get two gaming licenses. You 50 6/13/07 Rules Committee - CED Legislation go and decide the places where you think -- 'cause I --

Yeah. Sorry, no --

If we're only -- if we're only.

Let me answer the question. I think --

With all due respect, Mr. Solicitor, if there was no -- I just -- I'm curious 'cause in your comments, you talked about development and economic benefits.

I'd love to answer that question, and thank you for that question, because I think that no 18 matter where you put a casino inside the city, you would have to answer the question: As a city, is gaming beneficial? I think that when the task force convened between the time of the passage of the State Gaming Act and prior to the selection of sites, the 51 6/13/07 Rules Committee - CED Legislation answer is: Yes, if it's properly introduced. So how would you go about introducing gaming and locating it properly? You'd have to -- you would -- no matter where you put it, there's probably going to be some local opposition.

I understand that, I understand that. My question again is: If the Commonwealth of Pennsylvania were today to enact gaming -- Act 71, 72, whatever it is -- and said to the City of Philadelphia, you're going to get two licenses, you go decide on sites that you believe would be most appropriate, where it would benefit not only -- and I agree on the benefits.

I gotcha.

Let's say we agree on the benefits of gaming and all of that other stuff.

Sure. 52 6/13/07 Rules Committee - CED Legislation

Where would these locations be best suited in terms of economic development or to stimulate economic development in communities? And forgetting the -- not -- putting aside for a moment the community opposition 'cause just about anywhere, you're going to find that, and I recognize that pretty much in any community.

Yeah.

Would you, as a city planner, the head of the City Planning Commission, recommend any of the sites, any sites along the central Delaware waterfront?

I would say that if you were going to -- I actually believe that the waterfront could take one, but probably -- maybe not two, and I think that we said that as a study group --

Okay. 53 6/13/07 Rules Committee - CED Legislation

-- because of the -- the transportation structure that is not in place in advance. I also will say that the -- the question was, would you pick the waterfront as a site for casinos?

Any sites along the -- forget these two -- anywhere within the central Delaware waterfront, would you have recommended any sites within that area -- and you know the area quite well --

Right.

-- for gaming? Given the fact that --

First of all, the Planning Commission --

And I'm not going to give you the answer --

The Planning Commission -- the Planning Commission -- right.

Given the fact that there's a lot of development 54 6/13/07 Rules Committee - CED Legislation that has been going on and is continuing. You and I have been working on projects for a long time.

The Commission would never haul off and pick one because, first of all, the nature of planning is never, you know, we get to say. It's not the Robert (indiscernible) days. But you'd have to --

But you're approving a plan. I know I got you boxed into a corner, but you were boxed into a corner not too long ago when the Administration rushed the Planning Commission to approve this plan, all right? And I apologize. They created this; I didn't. We didn't create it; the Administration created this.

I believe that you would want to pick a -- there are sites on the waterfront that, when we 55 6/13/07 Rules Committee - CED Legislation have looked at the different locations that are more suitable because you can allow the traffic to go directly into the casino, the ones on the northern portion. They also are in areas that are the furthest --

Would Pinnacle be a site?

That would -- that might be one of them.

Okay.

They also -- farthest away from the neighborhood.

Would Foxwoods be a site?

No. 18

Would SugarHouse really be a site?

Um, that's -- that's closer to neighborhoods, so on the criteria of proximity to neighborhoods, that site, which we have already noted in the work that we did to evaluate the five sites was not 56 6/13/07 Rules Committee - CED Legislation ideal for that reason.

Thank you. (Applause.) (Cheers.) CITY SOLICITOR DIAZ: Councilman --

I -- I --

Thank you, Madam Chair. CITY SOLICITOR DIAZ: I would like to supplement what Ms. Woodcock just said. In connection with the study that she referred to, I believe that was the December 15, 2006, letter that the mayor sent to the Gaming Control Commission looking at the five sites that were then before the Gaming Control Board for location in Philadelphia. I think the mayor's statements in that letter are worth repeating, and that is that we evaluated the five 57 6/13/07 Rules Committee - CED Legislation sites. We indicated some that we thought were better than others. We had a particular recommendation that was not approved by the Gaming Control Board, although that decision on licensing is on appeal to the Pennsylvania Supreme Court. But the mayor's statement in connection with the siting issue is that we believe that any of the five sites, with certain improvements and changes and modifications, could be made to work, although we had sites among the five that we thought were better suited. I would also point out that beginning in early 2005, recognizing that the Gaming Control Commission was going to be making a decision on behalf of the Commonwealth to site two casinos in Philadelphia through the State Legislation Act 71 that you referred to, we were trying to understand the impacts; we were trying to educate not 58 6/13/07 Rules Committee - CED Legislation only ourselves but the community about those potential impacts and to ascertain what some mitigation strategies might look like. As to the most economically viable sites, certainly, a combination of two casinos in Philadelphia that included a riverfront site were considered to be economically viable and certainly had high returns in terms of revenues to the city. So I don't think that the City of Philadelphia, including the Planning Commission Director at the time and the Planning Commission staff, have ever taken the position that a particular site was unacceptable; we do not have the authority in the City of Philadelphia to make that decision, unfortunately. And so what I'm trying to clarify for the record, sir, is that in connection with the siting decisions reached by the Gaming Control Board, 59 6/13/07 Rules Committee - CED Legislation this administration has said that we will, in good faith, move forward to implement those siting decisions. We would have perhaps made different decisions, and there are measures that have to be taken to mitigate their impacts to make them work for Philadelphia and the neighborhoods affected by those sites. But I -- I -- I'm -- I want to try to -- to make clear for purposes of this record that the Administration including the Planning Commission and the Planning Commissioner or executive director of the Planning Commission and her predecessors, have all been a part of this overall Administration review. And the conclusions that I've just summarized, I think, are shared throughout the Administration, including the Planning Commission.

Well, I thank -- thank you for your comments, and I'm fully aware of what the 60 6/13/07 Rules Committee - CED Legislation Administration's position is. I guess for me, and we've said this repeatedly in the past, we've always taken this as a fait accomplis, and I think that was the wrong approach on the part of this administration. (Applause.)

And I -- I say that with the utmost respect. I think we should have been fighting harder with our lawmakers in Harrisburg. The Administration should have been fighting and said, Look, we accept the fact that we're going to have to live with two casinos, we accept it, we welcome two casinos, but let us go back and try to work with the two potential licensees who, for the most part, have been resistent to any discussion, any discussion of relocation, but for the Foxwoods folks who -- I actually drove them around. See, Mr. Solicitor and Madam Commissioner, you know, I've taken the 61 6/13/07 Rules Committee - CED Legislation time 'cause I thought it was my responsibility and my duty to look at other sites. One is in my district. One other site that I thought would work, and it was a glimmer of hope, is not in my district; I didn't discuss it with the District Councilperson because I didn't think there was a need to until there was a willingness on the part of the licensee to even consider that. But those are the things that I think we should have been pursuing. And had we done that -- in my opinion, had we done that, we probably wouldn't be here today with all of this protesting and back and forth. We would have all lived with the fact that two sites that are away from neighborhoods and not in close proximity to any of the communities that we're concerned about, I believe these casinos would have been under construction as we speak. That's my opinion. 62 6/13/07 Rules Committee - CED Legislation (Applause.)

But we've taken this position that it's something that we cannot undo. And I think that's wrong, and that goes to the crux of what the frustration is on the part of citizens is that we've always taken it -- oh, there's really nothing we can do. Well, those folks who gave us gaming are elected by the people the same way the rest of us in this room 13 are. And that's been my battle from day one. And we've never gotten that support from the Administration; it's been left up to Council to try to figure all of this out, when everybody's is trying to figure out how to get it done at the two sites that have been chosen. This is where you get it, this is what you have to accept, take it or leave it, it's a done deal. And that's what the 63 6/13/07 Rules Committee - CED Legislation frustration about this whole thing is. (Applause.) CITY SOLICITOR DIAZ: Councilman, if I can just make two brief responses. (Jeers.) (Council President Verna bangs gavel.) CITY SOLICITOR DIAZ: The first is, I would point out, as City Solicitor, that the decision with regard to the relocation of a licensed facility under the terms of Act 71 is a decision to be made by the State Gaming Control Board; we don't have that authority. Indeed, even a licensee voluntarily could not make that decision. And the second point that I would make, sir, is that in connection with the concerns about the impacts, you know, the mitigation measures and the land-use controls that I think the Planning Commission Executive Director 64 6/13/07 Rules Committee - CED Legislation talked about in her testimony, you know, one of the areas where you and I, on behalf of the City Council and the Administration, have joined and linked our interests is in connection with the ongoing litigation now most recently in connection with the second casino site. You know, that's been taken up on appeal, and the Supreme Court has been asked by the licensee to direct the City of Philadelphia to issue building permits before we have concluded any negotiations, before we have made sure that mitigation plans are in place. And in that particular lawsuit, we have fought vigorously against that effort because we think to the extent that we have the ability to retain local land-use control, we will not give that up. And we have a filing due today in the Supreme Court. In that litigation -- and I can assure you and Councilmembers that we are taking a 65 6/13/07 Rules Committee - CED Legislation very strong position. We didn't put the casino sites or select the casino sites; we didn't have a say in it as much as we would have liked. That decision has been made, and we are trying to make sure that to the extent that it has been made, the remaining authority of the city with regard land-use controls are effective, and we do not -- will not give those up voluntarily.

And I appreciate all of the efforts on behalf of the Solicitor's Office and all. But, you know, it gets -- you know, if we didn't approve the SugarHouse plan, I mean, that would have been another opportunity, I believe, for us to bring everybody back to the table. You know, the Planning Commissioner, in her own testimony, just said that, Well, if she had her way, she probably wouldn't pick the waterfront but maybe just one site for 66 6/13/07 Rules Committee - CED Legislation a casino, but two could be problematic. Where do we go from here? What do we do with Foxwoods? I mean, we're going to have to figure this out. Are we just going to say, Well, file 7 these suits, we won't issue permits, with the understanding, though, at some point, the Supreme Court will make its decision. If they rule against the city or they rule against the communities, well, we're going to have to accept the fact that Foxwoods will be there, even though we think that two casinos is the worst-case scenario for the Central Delaware waterfront. I just -- I -- I just have a hard time understanding or accepting that.

Just a word -- on that note, just a word of advice to the City Solicitor. If the Supreme Court rules against us on Foxwoods, just do what the state legislature has done on the 67 6/13/07 Rules Committee - CED Legislation other court ruling that required full funding of our court system; just ignore them. (Laughter.)

The Supreme Court -- the Pennsylvania legislature has ignored it for 9 years. We just don't issue the 10 permits. 11 (Applause.) 12 CITY SOLICITOR DIAZ: I -- I 13 fully appreciate that point, 14 Councilman. 15

And 16 that's a hundred million dollars a 17 year, a hundred million dollars a year. 18

They don't 19 pay attention to them either, so... 20

Thank you. Thank you.

The Chair recognizes Councilman Clarke.

Thank you, Madam President. 68 6/13/07 Rules Committee - CED Legislation Good morning. First, I'd like to -- without assigning blame, I would just like to concur with my colleague Councilman DiCicco about this whole process; it's probably the worse process I've ever seen as it relates to anything of substance in my 20-plus years of government. (Applause.)

But, unfortunately, it was dumped in our laps. And then I would like to first -- I would like acknowledge and thank all of the residents from the area of Fishtown that I represent and the area of Northern Liberties, and I want to acknowledge, Council President, that there are actually 50, 60 more residents from Fishtown that are in the Caucus Room that got here a little late; they didn't realize that they had to be here at 7 in the morning to get 69 6/13/07 Rules Committee - CED Legislation the seats, so I want to acknowledge them and thank them for coming down also. Mr. Diaz, I was -- you were actually at this meeting the other day in what was called -- some people referred to it as "Ground Zero," and it's actually the area that's directly adjacent to the site. And, consistently, a particular issue came up about the possibility of condemnation, and I know that there was some reference in the casino language about condemnation, but there are some concerns not only of that issue, but additionally, the publicity that PennDOT, using its powers, would ultimately come in and condemn some property. And I actually got a call from a resident two days ago that said they got a notice in their door about eminent domain, and it was probably a ruse; I'm sure nobody in an official 70 6/13/07 Rules Committee - CED Legislation capacity did that. But there is that level of concern that you just heard on an ongoing theme about the possibility that somewhere down the line, if none of us may be here to protect the residents, what happens? Can you tell me in very explicit terms what -- if this happens -- and I don't know what's going to happen. But if, in fact, SugarHouse happens, what's going to be put in place to stop the government, be it state or city, from coming in and using the powers of eminent domain to remove the people from that community? CITY SOLICITOR DIAZ: Right, Councilman. The Gaming Act, Act 71, as has a specific provision that prohibits the use of state eminent domain powers for purposes of furthering casino development. The issue that was raised was, Well, what happens if, for example, 71 6/13/07 Rules Committee - CED Legislation there is a lot more traffic congestion in the future, and at some point, PennDOT might independently make a determination that it's seeking eminent domain authority to improve the traffic system. I think you have to look at it both in a practical and in a legal context. From the practical perspective, there already is, as I had testified earlier, there already is a planned, designed, funded interchange for Girard Avenue that will be constructed in the very near future and an additional temporary facility that we have discussed with the state that they're committed to also implementing even more quickly, before SugarHouse opens, to address traffic concerns. I would hope that on a practical basis, the kind of concern that was raised at the community meeting last Thursday evening would 72 6/13/07 Rules Committee - CED Legislation essentially have been taken care of by these highway improvements that have already been approved and funded. But I also think that based upon the questions that were raised and because PennDOT is not the only authority in the Commonwealth with condemnation powers, then --

Yeah. Well, that was actually going to be my next question. What -- CITY SOLICITOR DIAZ: That I think, you know, what I took away from the meeting and what I have committed to doing is having a direct conversation with the state about that issue. We have, as part of this casino development process, been meeting with all of the state agencies once a month, with the city agencies involved in the process. The Governor's point person on it, Joe Martz, is there. It also includes 73 6/13/07 Rules Committee - CED Legislation PennDOT and the Department of Environmental Protection and many other agencies. I think that at the next meeting, which will be scheduled within -- I think it's within two weeks? something like within the next two weeks, this will be front and center of that discussion. I think you can legally construct an agreement that includes the parties that likely have condemnation powers, for them to forego the use of those force in order to protect the neighborhoods surrounding casino development. From my perspective, if the Act 71, you know, provision is explicit, it doesn't allow for condemnation powers to authorize casino development. I would see this as very much like what I discussed in connection with tax abatements: We should be able to, you know, to stay 74 6/13/07 Rules Committee - CED Legislation true to the spirit of the provision. Even if it hasn't anticipated all of the legal fixes, where we didn't have the protections in connection with the elimination of tax abatements at the city level, this settlement agreement, in principle, that I talked about this morning will allow us to get essentially the benefits that the state provided in Act 71 for the city. I think we need to construct an agreement with the state and other condemnation authorities to essentially give us the same level of protections for the neighbors of the SugarHouse Casino.

All right. As you're aware, because you were at that meeting, we had agreed to have some follow-up discussions with the adjacent neighbors and possibly some neighbors on the other side of I-95. Prior to that meeting, can you get us a list of every -- all -- every 75 6/13/07 Rules Committee - CED Legislation department within the state that has any condemnation powers whatsoever, be it casino-related, be it non-casino- related, 'cause sometimes you may say, Well, that's not related to the casino, but by the way, we think we just happen to need to build a hotel down the street, you know what I mean? CITY SOLICITOR DIAZ: Absolutely.

So there could be things that may be interpreted as not casino-related but could, in fact, if not for a casino, there was no 16 likelihood that that would ever happen. CITY SOLICITOR DIAZ: Right.

So I would like to get a list of every -- every agency that has any authority of condemnation. Prior to the next meeting, I would like to have -- and what -- you said earlier you guys are having a meeting internally, the government officials? 76 6/13/07 Rules Committee - CED Legislation CITY SOLICITOR DIAZ: The state and the city agencies involved in casino development have been meeting on an ongoing basis. In addition to the monthly meetings, we're in direct phone conversation. I intend, after this hearing, based upon your questions, to have certainly a follow-up telephone call with Joe Martz, and we'll see what we can do to prepare in advance of the next joint meeting with the city and state folks, you know, the kind of information you're looking for so that we can have some more definitive answers for the next community meeting.

Okay. Yeah, 'cause in response, the other issue is that I would also like to also have that as a part of that response, in preparation for the community meeting, okay? CITY SOLICITOR DIAZ: I certainly will commit to doing that, 77 6/13/07 Rules Committee - CED Legislation Councilman.

All right. Thank you. And just for the record, there was a number of other issues that were brought up at the community meeting, and there was actually one PennDOT-related issue with respects to an agreement that was not complied with, and I forget the and the timeline, but apparently when the I-95 construction happened, there was several commitments to the community that were not adhered to with respects to sound barriers and maintaining the I-95 corridor. And as was said in that meeting, there were several levels of concern raised because the same state that we're talking about now, did not comply with that agreement years ago, and so the likelihood that they will comply with any future agreements was somewhat limited. So that's why the 78 6/13/07 Rules Committee - CED Legislation level of distrust is quite apparent at that meeting. So we would like to have, you know, the reference of that also, as you indicated. CITY SOLICITOR DIAZ: And, Councilman, following that meeting, my office did have several conversations with PennDOT. It's my understanding that the consent decree of several decades back was focused on an area south of this particular neighborhood where the question was raised, so the consent agreement didn't directly address that issue for the Fishtown neighborhoods. On the other hand, we've talked to the PennDOT folks who believe that the kind of changes that are contemplated related to the Girard Avenue interchange probably would trigger federal requirements related to sound barriers, so we're in ongoing conversations with PennDOT about that. 79 6/13/07 Rules Committee - CED Legislation And I should be able to report more information to you and to the community before that next meeting.

Okay. And could you make sure that they understand that that issue, although it came up as a result of casino-related discussions, should have nothing to do with the casino issue in terms of commitment to the neighbors. I mean, I think that that's something that should happen regardless as to whether or not SugarHouse or any other casino happens, 'cause that's clearly an issue with respects to the local residents separate and aside from the casino issue, is to make sure that they understand that we're not asking them to do that as a part of any agreement on a broader casino issue; we're just asking them to do that because they should do it. CITY SOLICITOR DIAZ: We've made that point in connection with 80 6/13/07 Rules Committee - CED Legislation things like grass-cutting and trash pickup. PennDOT acknowledged that there are some challenges in that area, and they're going to work with us --

(Indiscernible.) CITY SOLICITOR DIAZ: And we'll have more feedback on that. I've just been told that the next meeting with the state group is next Tuesday, the 19th, but in advance of that, I'll certainly have those conversations with Joe Martz.

Thank you. Thank you, Mr. Diaz. Thank you, Madam President.

Are there any other questions or comments from the members of the committee of these witnesses? (No further questions.)

Seeing no one, thank you.

Thank you. 81 6/13/07 Rules Committee - CED Legislation MR. McPHERSON: Our next panel consists of Bob Sheldon, Ian Cope, and Terry McKenna.

Are they here? (Witnesses come forward.)

Good morning. Please identify yourself for the record and proceed with your testimony.

My name is Bob Sheldon. I'm the president of SugarHouse.

Welcome. (Jeers.) (Cheers.)

Please proceed.

Council President Verna, Councilman Clarke, and the other members of the Rules Committee. Good morning. My name is Bob Sheldon, and I'm the president the 82 6/13/07 Rules Committee - CED Legislation SugarHouse Casino. I have with me at the table Ian Cope, our lead architect from Cope-Linder, and Dan Keating from Keating Construction, the developer of our project. Seated behind me are Melanie Shaw, who is helping lead our community relations and diversity efforts; and our attorneys and counsel, Thomas Witt and Chuck Hardy; and Terry McKenna from Keating Construction as well. I would also like to mention that in addition to those here supporting us, there's over 50 people from the Fishtown neighborhood who are here to show support for SugarHouse but were denied access because of the capacity issues of the chambers, and we thank them for being here. Thank you for allowing us to testify today. I know your agenda is full, so I'll keep my comments brief and allow the others with me to detail 83 6/13/07 Rules Committee - CED Legislation our project. I've previously testified about the legislation that would mandate a 1500-foot buffer around our facility, and I will submit my prior testimony, but I want to provide an overview of our project and why we believe it was selected as the best of five Philadelphia proposals by the State Gaming Control Board. Our site, situated on acres 13 along the Delaware River, is currently 14 neglected and abandoned, our neighbors 15 are primarily industrial and 16 entertainment, and we have plans to 17 provide ample free parking for our 18 employees and our customers to keep 19 cars out of our neighboring residential 20 streets. There is good visibility of 21 our site both from Interstate 95 and 22 the Ben Franklin Bridge. As you may recall, the Philadelphia Gaming Advisory Task Force found that the area where SugarHouse is 84 6/13/07 Rules Committee - CED Legislation has excellent highway access and that local street congestion would be minimized. The closest major intersection, the Girard Avenue interchange, is already scheduled to be expanded by the Commonwealth, ensuring that traffic will not flow through surrounding neighborhoods. PennDOT has also developed a plan to minimize congestion while this interchange is being built. This was important to us because we don't want traffic congestion anymore than anyone else because it hurts business. It's for all of those reasons and many more that we selected the site. 2 billion in gaming taxes over the first five years of our operation, which will fund wage-tax reductions for all who 85 6/13/07 Rules Committee - CED Legislation live and work in Philadelphia; $17 million annually in host fees payable to Philadelphia, $5 million of which will go directly to schools; $7 million to $8 million annually in addition to local taxes; And the creation of an estimated 1100 permanent and high- quality jobs at an average wage of $40,000, including benefits. We've worked hard to develop a relationship with our nearest neighbors, and we are proud that so many have backed our proposal. As you will hear from other this morning, we've met repeatedly with our neighbors in order to create a real partnership, and we're humbled by the support that we've found. As part of our commitment to the community, we've committed to donating a million dollars annually to a Special Services District for use at 86 6/13/07 Rules Committee - CED Legislation their sole discretion once we're fully operational. We have also worked to reach agreement with the city in order to minimize the impact of our casino in the area and ensure the provision of necessary services to those closest. Someone asked why we're seeking to have this zoning designation passed now. The answer is simple: Every day of delay costs SugarHouse Casino significant amounts of money and costs the City of Philadelphia tax revenues.

We need to be able to plan for when construction will begin to ensure our financing, we need to contract with our vendors, and we need to begin to interview and hire staff. It's our goal to reach agreement with the majority of the relevant community groups and would not intend to seek final Council approval until that happens. We want a 87 6/13/07 Rules Committee - CED Legislation partnership with the community; although we are disappointed that a few community groups have refused to meet with us for ongoing about six months, we remain committed to working with them, but we need to make this important step forward. In closing, we're very proud that our proposal was unanimously approved by the City Planning Commission, and we hope that you will affirm their decision and support our zoning designation as a Commercial Entertainment District. I'd like to introduce Dan Keating now, please.

Than k you, Mr. Sheldon.

Thank you.

Madam Chairwoman and members of the Rules Committee, good morning.

Good morning. 88 6/13/07 Rules Committee - CED Legislation

My name is Dan Keating, and I am the Chairman of Keating Construction Company. My firm was founded almost 35 years ago, and we have developed or built some of the premier properties in the Philadelphia region, including the Phoenix across the street, the Hyatt at Penn's Landing, NovaCare Complex, many sections of the Philadelphia International Airport, the Federal Detention Center, Levine Hall at the University of Pennsylvania, the Pennsylvania Convention Center. All in all, we've completed over a thousand projects in the City of Philadelphia, representing tens of thousands of construction and permanent jobs. I'm here today to discuss the development of the SugarHouse project of which we are the lead developer and I am a local partner. When fully built, the SugarHouse Casino will be an 89 6/13/07 Rules Committee - CED Legislation exciting $550 million casino and entertainment project. The first full phase of development will include space for 3,000 slot machines, dining, over 3,000 free garage parking spaces, and a 6,000- square-foot multi-use event center. Future expansions will include development of a new 500-room hotel, expanded dining options, and a spa. The Pennsylvania Gaming Act requires that applicants must control their site when they apply for a license. Our group analyzed more than a dozen sites over a two-year period, including many of the sites examined in the mayor's Gaming Advisory Task Force sites and sites along the Delaware River and the Navy Yard. We could have selected another site; we selected this one because it is simply the best site in the city to build a casino. (Jeers.)

Having built 90 6/13/07 Rules Committee - CED Legislation numerous major projects in the city -- (Applause.)

Please don't say another word.

Having built numerous major projects in the city, I am well aware of what it takes to build a successful project. This site was, and is, the best. There are three things that I would draw your attention to today as you consider these bills: The jobs and the taxes that will be generated during construction and the cost of delay. During construction of the first phase, we expect to hire over 1200 union workers and pay tens of millions of dollars in wages and local wage taxes. We are committed to hiring locally and contracting with small and minority-owned firms. I am proud to say that my company has a strong and decades-long reported of inclusion, routinely besting participation 91 6/13/07 Rules Committee - CED Legislation targets. And with the successful first phase of this project, we would expect to hire an equal number of workers to complete our proposed second phase. In addition to the loss of casino revenues and jobs, there are real costs of delay in the development as well. For a project of this size, we must begin to order certain building materials and equipment that require months of lead time. Our budget was based on costs that will increase if we are delayed. With this committee's approval of zoning, we can begin the schedule and place orders for these materials and make commitments to the firms that will result in a timely and cost-effective delivery of this important project. We believe that delay is bad for the city and we know it is bad for the project. We hope that you oppose the DiCicco bills and support SugarHouse's zoning needs. 92 6/13/07 Rules Committee - CED Legislation And I thank you for listening to me this morning.

Than k you very much. (Shouting from audience members.) (Council President Verna bangs gavel.)

Please, I don't want anything to prevent these hearings from going on, but if your behavior is going to be as it has been, we're going to continue it. So please, let's have respect for each other. Please proceed. Identify yourself for the record and proceed with your testimony.

Good morning, Madam Chair and members of the committee. I am Ian Cope of Cope-Linder Architects in Philadelphia. Good morning. I've been asked to provide a brief design overview of the proposed 93 6/13/07 Rules Committee - CED Legislation SugarHouse project and its constituent phases of development. Now, the handout I believe you have before you has been excerpted from the formal plan of development, which is the larger binder, and this was submitted to the Planning Commission in March for their review. As the executive director of the Commission has described, that plan of development is essentially a comprehensive master plan, as is required by the CED ordinance. The full plan of development contains architectural plans in more detail, technical zoning documents, traffic studies, lighting and landscape plans, and narratives. A table of contents from the full plan of development is included in the back of that handout. Before starting with the description of the design, I think it's worth describing the various principles that have guided the development of 94 6/13/07 Rules Committee - CED Legislation this plan. First and foremost, we viewed the waterfront location as a shared public and private amenity, where our patrons and the public-at-large would have equal to all that the river offers. Second, we want to development a scheme that would promote proper onsite traffic management, with adequate stacking and ample parking to virtually eliminate the potential for any congestion on surrounding streets. Additionally, we wanted to develop a scheme that would permit a seamless future expansion of the project, as is required to be demonstrated to both the Commonwealth and as part of the CED. From an aesthetic standpoint, we wanted to create a compelling and attractive assembly of buildings and landscape spaces in a decidedly contemporary character that we think is 95 6/13/07 Rules Committee - CED Legislation befitting a modern waterfront. And last, but not least, we wanted a plan that fully ascribed to the city's own planning criteria that was adopted specifically in anticipation of this kind of project; that's the CED ordinance. The first image depicted is of the footprint of Phase 1 and the expansive port-cochere area at the foot of Frankford Avenue as well as the main self-park garage at Shackamaxon Street and landscape promenades that go to and fro along the entire waterfront. It's important to note that these plans are not the first iteration; but, rather, this plan results from many suggestions and design input that we received at countless community meetings and at work sessions with the Planning Commission staff. Their input guided the development of: More useful open space, the 96 6/13/07 Rules Committee - CED Legislation addition of a large public plaza at the water's edge; Bringing pedestrian entrances out to Delaware Avenue; The enhanced use of public transportation; And other improvements, such as the including of the ferry dock and the green roof. Their input was invaluable in the process. This next image, if you're following along, shows the expansion of the project to the south or to the left of the drawings, with the casino expansion accompanying the development of potentially two new hotel towers and the addition of a large multipurpose event center. Provisions have been made to expand that parking to support this additional development, and this expansion can occur without any interruption to the ongoing operations 97 6/13/07 Rules Committee - CED Legislation of the casino; or as important to the neighborhoods, any impact on traffic flow into our out of the site. These next two images show what is essentially the basement level of the Phase 1 and in the future expansion. We show you this only because we have gone to great lengths to conceal virtually all of the many back-of-house areas, valet parking and truck traffic and loading docks from any public view from around the entire perimeter of the site.

Where our building does meet the street along Delaware Avenue or along the river, we have lined the perimeter with pedestrian-friendly entrances and retail or restaurants uses. This next image shows the main casino floor, where the action includes much more than slot machines. The gaming area, including the 3,000 machines, is ringed with exciting 98 6/13/07 Rules Committee - CED Legislation restaurants, lounges, and small- performance venues -- they're depicted in green and yellow -- with the particular focus on the river and street frontage. Pursed slightly above the street and public promenade level, the casino will feature restaurants with open terraces that overlook and frankly activate the river's edge and the public plaza year-round. Parking to support the Phase 1 development will include over 3,000 self-park and valet parking spaces. The following image similarly shows the expansion of that gaming floor in future phases to accommodate the additional hotel towers and the 30,000-foot event center on the upper levels, the full complement of 5,000 slot machines, as well as added restaurant venues along the riverfront, and another complementary pedestrian entrance along Delaware Avenue. At 99 6/13/07 Rules Committee - CED Legislation full buildout, the project will have in excess of 4500 parking spaces. The three pages that follow represent, perhaps more interesting, three-dimensional views of the proposed massing scale and general character of the project in both the initial phase as well as the future expansion phases. These are consistent with the plans. Although the detailed designs are not yet finalized I think you can begin to get a sense of the scale and extent of green landscaped area devoted to creating a dramatic sense of arrival and a balanced composition of contemporary buildings. We've designed the plan so that there is no back door, with equal billing to Delaware Avenue and the river. You will note the extensive use of windows throughout. The SugarHouse will be anything but a windowless box. These last two images are cut-throughs, which help demonstrate 100 6/13/07 Rules Committee - CED Legislation the broad public promenade areas outside of the building along the insides and along the river, all devoted to creating that important first impression and providing generous dedicated open space for the public to stroll, walk, jog, bike, or enjoy all of the many activities that the SugarHouse will offer. Since initially submitting the plan of development, we have made additional commitments or stipulations to provide a pervious green roof over substantial area of the structure. Also, as the executive director mentioned, we are continuing to work through the lead or green building design process, as is described in the ordinance. These are important environmentally appropriate elements of the design. We believe the CED ordinance 24 was specifically adopted in anticipation of lawful gaming. And 101 6/13/07 Rules Committee - CED Legislation given the extent of provisions related to public access to the waterfront, it can only be assumed or inferred that this bill was, in fact, envisioned for large waterfront sites such as the SugarHouse. I would like to reiterate that we are confident that our plan, including all of its constituent phases, meets or exceeds all of the city's design criteria and regulations, as prescribed in the CED ordinance with respect to allowable floor area, FAR, parking requirements, setbacks pervious coverage, landscaping, area and height regulations, and, of course, permitted uses, including licensed gaming facilities. Obviously, the Planning Commission staff and commissioners concur.

As an architect and a Philadelphian, I am not aware of any other privately funded project along our waterfront, or the entire city for 102 6/13/07 Rules Committee - CED Legislation that matter, that proposes to develop and maintain such an extraordinary amount of useful public infrastructure improvements and abundant usable public open space as that contemplated for the SugarHouse. For over 30 years, since before the Bicentennial, we have spoken about and purportedly aspired to have an engaging public waterfront with exciting entertainment along portions of its banks. To be sure, there have been some noteworthy developments along the river, but many of these lack critical mass, and some are downright insular, almost gated, communities that only a privileged few can enjoy. So in addition to creating many and important good jobs, I believe that SugarHouse, like no other project, also holds the promise of jump-starting this process by transforming a fenced, dirt site into a vibrant, publicly-accessible waterfront 103 6/13/07 Rules Committee - CED Legislation destination, just as the CED ordinance 3 clearly envisioned. Thank you for your consideration. )

Thank you very much. The Chair recognizes Councilman Greenlee.

Thank you, Madam Chair. Could you briefly describe what is in here in the written agreement and if you've discussed that with anybody; you know, that kind of thing.

Yes, I'd like to answer that for you and ask our counsel, Chuck Hardy, who's been involved in that process. In a number of -- we've met with a number of different groups from the community. Especially over the last few months, there were some local 104 6/13/07 Rules Committee - CED Legislation residents of Fishtown who approached us and voiced their concern that they felt they weren't being -- that their voices weren't being heard or represented as far as the potential development of the casino in their area. They've communicated with their local neighbors and they've got a membership of well over 200 people that they've formed an association called Fishtown Action. We've met, they've invited us into their living rooms and their homes to talk to their friends and their neighbors. Some of them are for us, not all, but we've certainly had the dialogue with those that oppose us, as we offered to speak with anyone who has -- who would like to meet with us. And basically, that's been our motto. We'll meet with anyone anytime, and we'll come to them. So that's been a very positive process. They had a membership meeting last week. They had close to 300 105 6/13/07 Rules Committee - CED Legislation people, I believe, in attendance at that meeting, the majority of which were very vocal about their support for the development of the waterfront. We've had discussions with Fishtown Neighbors Association, we've had discussions with the Northern Liberties Neighborhood Association, New Kensington, and we've had -- not recently, but in the past, we've had discussions, meetings, and negotiations about a CBA meeting with the North Delaware Avenue Unity Coalition, which is a composition of the local neighborhood community groups. And, Chuck, you may want to add some --

Yeah. I've attended numerous meetings --

Mr. Hardy, please identify yourself for the record.

Yes. My name is Chuck Hardy, I am house counsel to the 106 6/13/07 Rules Committee - CED Legislation SugarHouse Casino. Prior to the time that the SugarHouse was selected by the gaming board to have its application approved, we met with -- separately with Fishtown Neighborhood Association, the New Kensington CDC, the Northern Liberties Neighbors Association, and attended every meeting we were invited to, and requested give-and-take. We were there for several reasons; one had to do with getting an understanding of what concerns the community had and to get some input from the community on our design, which, at that point, was not finalized. In the course of those many meetings, the general consensus of the community was that they would like to have a Special Services District established, which would allow community members to control the expenditure of a significant amount of 107 6/13/07 Rules Committee - CED Legislation money to mitigate what they perceive might be adverse effects of the SugarHouse opening. In that regard, we prepared a proposed community benefits agreement which outlined the role that the SugarHouse Casino might play, and it was primarily a funding role with regard to a Special Services District. We used as a model which seemed analogous the Special Services District that operates down in the stadium complex area. We submitted that proposed community benefits agreement, and we also circulated to members of the community the constituent documents of the Special Services District down at the stadium to give them an idea of the kinds of problems that they might encounter in terms of deciding what the boundaries would be, who would sit on the board, who make the decisions.

Excuse 108 6/13/07 Rules Committee - CED Legislation me one second. That was before the selection, you say, or --

That was right after we were selected.

All right.

These were continuing meetings; we didn't skip a beat with all of that. The thing that -- and we did submit all of these papers, and at that point, we were advised by the three groups who we had spent the most time with -- Fishtown Neighbors, New Kensington CDC and Northern Liberties Neighbors Association -- that they had joined a larger coalition, we were invited to a meeting of the coalition. We attended the meeting of the coalition, and we responded to a multi-page -- it was like an eightset of questions that they had and discussed the possible impacts of the casino and the possible interaction 109 6/13/07 Rules Committee - CED Legislation between this large new establishment that was coming to the neighborhood and the neighborhood organizations. At that point, we were told that the North Delaware Avenue Unity Coalition had decided that they needed a respite from discussions with casino developers, that they didn't want to talk with us while they were taking care of whatever internal concerns that they had; and as a result of that, we didn't hear directly back from them for some period of time.

Sir, could you speak just a little closer to the microphone.

Sure. We did hear indirectly back from them through other people who were talking to them, including people in the City Solicitor's Office, that there were some concerns. As a result of that, we made some revisions in the community 110 6/13/07 Rules Committee - CED Legislation benefits agreement that we had proposed six months before, and we circulated that to the contact person from the North Delaware Avenue Unity Coalition, who represented nine or ten groups, including the three from our neighborhood, and to other people who were interested. Anyone who asked for it got it. And we are, at this point, open to discussion and available to discuss; and, in fact, have planned to have some further discussions as soon as next Monday with the community groups to finalize these documents.

Just one last question. If you know, Councilman Clarke alluded just earlier to the group that -- I forget exactly what they call themselves, that lives just like two or three blocks to the place. Have you had any direct discussion with them, or have some of those residents been involved in some 111 6/13/07 Rules Committee - CED Legislation of the other groups? If you know; I don't know if you know.

I do know. Go ahead, Bob.

Okay. We initially attended that meeting with Councilman Clarke and at the request of the residents; they felt they wanted more of a one-on-one discussion with their representative, so we were asked to leave. Prior to that, I had the opportunity to invite I believe it's about ten to twelve members from that community to our office, which is across the street. We have an area set up where we have our plans and our model set up, and one of their neighbors actually offered to invite those people. So I met with probably ten to twelve of them, walked them through the project, and it was a very good discussion, a very healthy one, and, I 112 6/13/07 Rules Committee - CED Legislation think, very positive. Initially, myself and I have about four people on my executive staff now, between us all, we've knocked on every door in that neighborhood and have probably spoken to 50 percent of the people in the area on numerous occasions. That was earlier in the year, trying to engage those discussions. And, again, we met some positive people, met some people that were opposed; but in any case, we had a good discussion.

And, Councilman Greenlee, you were at that meeting, and I think you will recall how, at the beginning, there was an attempt to limit the people that were at that meeting to those who lived east of I-95; that was not -- ultimately, that didn't happen, and a large number of people from the larger community wound up at that meeting. 113 6/13/07 Rules Committee - CED Legislation We have spoken to people from the immediate community who were at the meeting who felt that they didn't have an adequate opportunity because it was so dominated by people from outside the area that the focus on that particular smaller area's interests was diffused. But we were there, we were asked to leave, and so we did leave.

Okay. No, I know that part. Yeah, I just didn't know what other things there might have been or that kind of thing. Okay. Thank you, thank you.

You're welcome. The Chair recognizes Councilman Kenney.

Thank you, Madam President. Mr. Sheldon, you had alluded in your testimony that were groups or a group that refuses to meet with you or has refused to meet with you. Do you 114 6/13/07 Rules Committee - CED Legislation know who those groups are? and have they given you a reason why they refuse to meet?

Well, it would be Fishtown Neighbors Association, Northern Liberties Neighborhood Association, and the North Delaware Avenue Unity Coalition, to be specific. There may be a couple of others.

I'm sorry. They've refused to meet?

Yes, that's correct. They refused to meet and negotiate further on the CBA.

So I'm clear in the timeline: They met with you originally and then had to cut off meetings?

That's correct.

Okay. And did they give you a reason?

Yes. The reason they gave us was that they -- the immediate community groups had formed a 115 6/13/07 Rules Committee - CED Legislation coalition with groups from South Philadelphia and other areas further away from the SugarHouse, and that that group had agreed, as a policy, that all of them would follow, that they would not negotiate with the casinos or have discussions with them until they were ready to do so, and they have not yet told us they were ready to do so. We understand that some of the community groups may be reconsidering that, but at this point, their official position -- Fishtown Neighbors and Northern Liberties that they are sticking to the agreement they made with the North Delaware Avenue Unity Coalition. You're going to be hearing from them later; you can find out from them.

How long has that been since the last contact?

At least since January, I believe, was our last 116 6/13/07 Rules Committee - CED Legislation official meeting.

Okay. Thank you.

Any other questions or comments from members of the committee? (No further questions.)

Gentlemen, thank you very much.

Thank you, Madam Chair.

Thank you.

Than k you. (Applause.)

Mr. McPherson? MR. McPHERSON: Our next witness is William Schwartz. (Applause.) (Jeers.)

Mr. McPherson, would you please call up the next panel, and maybe they could 117 6/13/07 Rules Committee - CED Legislation sit in the front. MR. McPHERSON: The next panel is Steve Wexler, David Odell, Shawn Rairigh, and A.J. Thompson. (Witnesses come forward.)

Good morning. Please identify yourself for the record.

May it please the committee, my name is William G. Schwartz, an attorney with the law firm of Obermayer, Rebmann, Maxwell & Hippel, and I represent the Philadelphia Entertainment Development Partners, LP, a successful licensee for Category 2 gaming license under the State Gaming Act and owner of 1499 South Christopher Columbus Boulevard, otherwise known as Foxwoods.

I just have a question prior to the --

Councilman Kenney.

Thank you, 118 6/13/07 Rules Committee - CED Legislation Madam President. I have a question prior to the commencement of this testimony. Is there anyone else here from Foxwoods today?

No. 8

Is there a reason why there is no one else here from Foxwoods besides yourself? And no -- no insult to you, but it seems that when we get testimony from SugarHouse, we get the president and everyone else that has any -- can answer any question, and when we hear from Foxwoods, we usually only hear from you. And I have no problem hearing from you; it's just that it would seem to me it would be in their best interests to engage, as SugarHouse has engaged, with this process. And is there a reason why they choose not to come here at all?

Well, I don't 119 6/13/07 Rules Committee - CED Legislation think that's necessarily true, and the reason is --

Well, the chairs are empty.

-- is that we're not pushing our development before this community. What we're hearing is opposition to contra casino legislation that we believe is illegal. It's a legal position, and it merely requires a statement before you as to that legal position.

For the record, I find it very helpful to be able to engage with the proposed casino operators on a one-to-one basis as opposed to through their lawyer --

All right. I understand.

And if you want to -- if you could please send those sentiments back to the people of Foxwoods --

Sure. 120 6/13/07 Rules Committee - CED Legislation

-- 'cause I think they need to get their selves in here.

Certainly. Thank you. I'm here today to offer testimony in opposition to billions 070006, 070008, 070010, 070011, 070012, and, in particular, Bills No. 070391 and 070264 that would prohibit the city from allowing the construction of gaming facilities within 1500 feet of various uses, the Bill No. 070264 that proposes an extension of the North Delaware Avenue controls ordinance 17 southward to Oregon Avenue that would prohibit both new restaurants, et cetera, as well as expansion of existing facilities. All of the proposed bills under discussion are both unwise and illegal. These bills are really nothing more than an attempt to exclude gaming from the City of Philadelphia. 121 6/13/07 Rules Committee - CED Legislation If these bills pass, they will have the effect of excluding casinos as permitted zoning use in Philadelphia. As a result, Philadelphia will lose the much-needed revenue, tax relief, and jobs, which gaming will provide. In general, the proposed code amendments contained in all of these bills would most likely be viewed by a court of review as invalid and illegal. In particular, I will first address Bill 070391 that prohibits gaming. This proposed code amendment is contrary to the laws of the Commonwealth of Pennsylvania. The state legislature, through the Gaming Act, gave the Gaming Control Board exclusive control over the location of gaming establishments. If the proposed code changes are enacted, the Gaming Control Board's exclusive jurisdiction to site casinos could be illegally usurped since the Commonwealth granted the power to site the casinos to the 122 6/13/07 Rules Committee - CED Legislation Gaming Control Board and not to the city. In addition to being contrary to the Gaming Act, it is beyond the city's powers to enact the amendments in the bills proposed before this committee. The City of Philadelphia is an entity of the Commonwealth of Pennsylvania and only has the powers granted to it by state statute, which can be limited or withdrawn by another statute. The state granted the city to power to control the size, location, and use of land; however, the state legislature has limited the city's power to do so in certain situations, like exempting property owned or used by State-related entities from city zoning and land-use requirements. Here, the state has enacted a statute which gives the Gaming Control Board exclusive control over the site of gaming establishments, and the 123 6/13/07 Rules Committee - CED Legislation city's general authority over those land-use decisions has been preempted. Thus, the proposed amendments would be invalid because they exceed the powers granted to the city. This proposed gaming prohibition is patently illegal as an ultra vires act by this Council. Additionally, prohibiting a casino within 1500 feet of a residence, school, or place of worship would limit Council's ability to approve zoning legislation for just about the entire city. Originally, the distance separation called for in an earlier version of Bill 070391 was 1,000 feet, or more than three football fields, away. However, in order to target my client's property, the distance separation was increased to 1500 feet, or five football fields, away, clearly over the top. This prohibition would certainly be considered by any court to 124 6/13/07 Rules Committee - CED Legislation be de facto and de jure exclusionary zoning, which the Supreme Court has said violates both United States and Pennsylvania constitutions. If such a decision is found by the courts, then, as all of you know, gaming would be allowed anywhere in the city because of the exclusionary nature of the proposed bill. The previous history of Bill 12 070391 says it all. This is the same anti-casino ordinance that was proposed by a citizens' petition for a referendum on gaming. That petition was thrown out by Common Pleas Court, and the referendum ordinance passed by this Council was preliminarily enjoined by the Supreme Court.

As before, City Planning voted to oppose this proposed ordinance. Notwithstanding all of that, this Council continues its Don Quixote tilting at windmills. As to Bill 070264, the proposed extension of North Delaware 125 6/13/07 Rules Committee - CED Legislation Avenue controls southward to Oregon Avenue, this is just another illegal attempt by this Council to obtain a veto power over the Gaming Board's licensing decision, a power to which this Council is not legally entitled. , prohibit accessory uses -- what it can't do directly, prohibit the main use of casino gaming. At the recent City Planning Commission Board meeting on these two bills, which the board voted to oppose, Mr. Kramer of City Planning staff advised the board that the only apparently reason is to stop Foxwoods. That clearly constitutes special legislation, which is unconstitutional. )

And this is just more proof of the unconstitutionality of this bill. In short, all of these bills seek to delay or derail the millions of dollars of benefits and thousands of jobs that gaming will bring to Philadelphia. Rather than continue to spend resources on protracted legal battles, we should be seeking to advance the creation of jobs and revenue, which gaming will bring to Philadelphia. We respectfully request that 127 6/13/07 Rules Committee - CED Legislation the committee vote to oppose bills that I've already mentioned. As stated in earlier testimony before this committee, the battle of siting should not be with us but rather with the Commonwealth and the Gaming Board. Thank you.

Than k you, Mr. Schwartz. Are there any questions from members of the committee? (No questions.)

Than k you very much.

Thank you. (Jeers.) (Applause.)

Our next witnesses? (Witnesses come forward.)

I would like to ask Mr. McPherson to please call up the panel number 5. They could sit on the side chairs. 128 6/13/07 Rules Committee - CED Legislation MR. McPHERSON: Charlotte Levins, Lauren Griffith, Donna Tomlinson, Joe Rafter.

You skipped a panel. He was Panel 3; we're Panel 4.

I know.

Oh.

You're seated at the witness table, are you not?

Yes.

Aren't you seated at the witness table?

Yeah.

Is this Panel 4? PANEL: Yes.

Okay , you're there. Please identify yourself for the record and proceed with your testimony.

My name is 129 6/13/07 Rules Committee - CED Legislation Stephen A. Wexler. Good morning and thank you to members of Council and the president.

I'm sorry. You're going to have to pull the microphone closer to you.

I am a member of the Central Delaware Riverfront Advisory Group, which is charged with the task of developing a civic vision for the seven-mile stretch of the Central Delaware waterfront. A resolution was passed by the advisory group at its June 4, 2007, meeting and expressed the advisory group's dissatisfaction with the manner in which the Philadelphia City Planning Commission reviewed and approved the SugarHouse Casino development plan on May 22nd. The resolution criticized the Planning Commission for failing to provide adequate public notice before the May 22nd meeting and for the Commission's apparent disregard for the 130 6/13/07 Rules Committee - CED Legislation work of the Central Delaware planning process in its casino plan review and approval process. The advisory group asserts that the Planning Commission, in not using the civic values, principles and design guidelines developed through an ongoing and robust civic engagement process as criteria in its casino review process, has ignored the work authorized by Mayor Street in his executive order of October 12, 2006, creating the Central Delaware Waterfront Initiative. Furthermore, the advisory group believes that the actions of the Planning Commission constitute a significant missed opportunity to integrate valuable citizen feedback to improve waterfront development proposals. The advisory group is further concerned that the Central Delaware riverfront planning process appears to 131 6/13/07 Rules Committee - CED Legislation have been conducted on a parallel, but intentionally separate, course from the casino design review process. As you know, Penn Praxis was invited by the city in October of 2006 to lead the development of the civic vision for the waterfront. Since that time, in collaboration with the Penn Project on Civic Engagement, we have worked with many thousands of Philadelphians to help shape citizen values and principles to guide planning and development along the central waterfront. These civic values and principles serve as the basis of a set of urban design guidelines that call for a pedestrian-friendly, mixed-use environment. The goal is to create a vision that protects the public interests, encourages quality development, and balances with the working port. In facilitating this civic 132 6/13/07 Rules Committee - CED Legislation process, we have remained neutral on the issue of land use, including the sites of the proposed casinos. We have focused instead on guidelines for development and infrastructure investment that will support a variety of development initiatives, whether casinos are built on these riverfront sites or not. The advisory group has adhered to the civic principles that emerge from the public process, principles which provide a strong civic foundation for the work, and foster the urban character that makes Philadelphia so special. The commitment to all Philadelphians has been to conduct an open and transparent public planning process, and the Central Delaware Advisory Group continues to maintain clear and frequent communication about the project's progress with the public. The advisory group has worked hard over the past seven months to 133 6/13/07 Rules Committee - CED Legislation bring multiple riverfront stakeholders together to seek common ground around shared values for the future of the city. The advisory group has attempted to host a civic dialogue on the tensions and trade-offs associated with development, growth, and change. We realize the development of the waterfront holds great promise for the future of Philadelphia; and at the same time, we know that neighborhood change is a matter which must be addressed with great sensitivity. The prospect of casinos on the waterfront has dominated much of the civic dialogue and has been a source of tension throughout the process.

The urban design guidelines and planning principles that we have developed are the direct result of this important public dialogue; and as such, they reflect the will of the people of Philadelphia. The advisory group is greatly 134 6/13/07 Rules Committee - CED Legislation distressed by the Planning Commission's apparent lack of these principles and urges Council to use these tools to review and judge the merits of all waterfront development. Philadelphia must begin to establish strong development rules that protect the public good while encouraging quality private development along the part of our waterfront which is dense, historic, and urban. The advisory group believes that no development should move forward until we have an open and public process that explains decisions and respectfully acknowledges disagreement. We look forward to bringing the values, principles, and design guidelines developed in this process to that discussion. Thank you very much.

You're welcome. (Applause.) 135 6/13/07 Rules Committee - CED Legislation

Who will be testifying next? Please identify yourself for the record.

J. Thompson, and I live in Fishtown. Despite being the vice president of the Fishtown Neighborhood Association, I will be giving my testimony on behalf of my own thoughts and observations from a year-and-a-half in this process. And I will say that I've never seen -- I'm only 30, but I can imagine that no issue or anything has divided our community as much as this, perhaps maybe when the Phillies and the 'As were town and who to root for; I don't know. But I will say that the one sign -- you know, there are signs on both sides of this issue here. The sign that means the most to me is the one that says "We Live Here," because there are a lot of the people who live very close to this, and Darryl alluded 136 6/13/07 Rules Committee - CED Legislation to this earlier -- Councilman Clarke alluded to this earlier in his testimony about a meeting that he and Councilman Greenlee attended. My original testimony today was to say that Council has not been informed to the extent that it would need to to vote on today's bills. Since they have been tabled, I want to say why. We are not at a point where you, who are going to vote on this, can feel comfortable that all of the issues and concerns of the residents who live immediately adjacent to this facility have been addressed. The issues that will affect my community going forward for the next 30 to 50 years are still on the table. Solicitor Diaz has what looks to be a pretty substantive deal negotiated with the operator; however, he admitted that it is not final, and since it isn't final, we still have 137 6/13/07 Rules Committee - CED Legislation work to do. A lot of conversation during this process has focused on the mayor's task force. The Mayor's task force operated in a vacuum before the sites were selected. We now have a site selected, and it's up to Council to vote on this issue. And I respectfully request that before you come back from September -- before you come back in September that you appoint a commission, a task force for Council specifically, so that you can be fully informed about every issue that's going to affect this development pro or con; because unfortunately, at this point, it does not exist. And we have three months before you come back, and this will likely be on the table in a session in September, and we'll all be back in the room. But I want to feel comfortable 138 6/13/07 Rules Committee - CED Legislation that at that point, everybody on this panel and everybody in the larger Council can say with certainty that all of the stones have been unturned, every issue that the operator has to be address has been addressed from a community standpoint, every issue that the city has to address is addressed from a community standpoint, and every issue that the state needs to address is addressed from that community's standpoint. So. I respectfully request -- I don't know if it takes legislation. It might just take volunteer time from your staff and yourselves to substantively get involved with our community to hammer out issues. You know, something has been made about the Fishtown Neighborhood Association's decision not to talk to the operator. And, unfortunately, you know, or fortunately, for us, we do exist in a democracy, and our 139 6/13/07 Rules Committee - CED Legislation membership voted to do that. And, you know, just as you guys have to listen to your constituents, and when they vote for something, you have to go that way. We ask that -- we stopped talking to the operator because there were a lot of things going on. Things have changed a little bit. This legislation being introduced has changed the playing field a little bit. Now that it's been tabled, we still have time. I don't want to tell my daughter when she's 15 years old that Daddy and his friends could have protected the neighborhood a little bit better but we just went down the shore three months and really didn't talk to Council about things that we really could have put in place before this was done.

Now, this could come back in September, and you guys could table it 140 6/13/07 Rules Committee - CED Legislation again, and the casino doesn't get built for a long time or ever, but we need to take this time to substantively look at this issue so that you're satisfied, because if I was sitting where you're sitting -- and I think Darrell at the meeting and Bill, to some extent -- Councilman Greenlee and Councilman Clarke to some extent realized that there are things that need to be talked about, and there are things that we need to pay attention to, and there are deals that are not done. To rush this now, without looking at this, would be a mistake, and it's something that we would pay for for a long time.

Did I understand you to say that you're not willing to meet with the CEO, as he indicated?

Personally? I -- I think it's time that we meet with the operators. 141 6/13/07 Rules Committee - CED Legislation

I beg your pardon?

He says it is time.

There is a growing feeling within the community that these issues are not being addressed. Certainly you don't want to do that without -- with under -- by undermining the efforts of people who are trying to stop this and who everybody should respect, because they, at their essence, care about their own community. But legislation is on the table that needs to be looked at and discussed. I'm confident that if Council would put together a task force that there would be participation from groups that might not be participating in the process right now, and I can assure you that I will advocate as much as I can and bring people to the table to do so -- not with the stated 142 6/13/07 Rules Committee - CED Legislation intention of legalizing this, but with the stated intention of, if it does happen, that all of the issues that need to be addressed are addressed 'cause they are not there; they're just floating in the winds.

We will certainly put your request under consideration. Thank you.

It has to -- I just want to add that we can't wait; it needs to be done immediately.

Mm-hmm. Thank you. The Chair recognizes Councilman Greenlee.

Yeah, just one quick thing. Not to belabor this, but, Mr. Thompson, would you agree that if there are other groups in Fishtown meeting with the SugarHouse people that it doesn't serve the purpose of the opponents at least not to have some 143 6/13/07 Rules Committee - CED Legislation discussion?

I mean, I agree that it's time to talk, and I understand that people are speaking with SugarHouse. I mean, I don't -- I don't see how not addressing these issues serves our purposes, and I think it's time that we do that. And I'm asking that Council sort of take the reins over -- stop referring to the mayor's task force that was created a year ago. Let's write a report about something that's been chosen and that is in front of you right now.

Okay. But everybody should be willing to participate in that if that happens, right? (Indiscernible; parties talking over each other.)