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Project changes outlined Casino team hopes to stay in the game

Thursday, August 07, 2014 - Updated: 10:20 AM

By NICOLE ANTONUCCI

nicole.antonucci@recordernews.com

The development team for a casino at Thruway Exit 27 is trying to stop the potential disqualification of its application for one of four gaming licenses in upstate New York.

The state gaming Facility Location Board is expected to discuss disqualifying Florida Acquisition Corp. during its monthly meeting in New York City today at 6 p.m.

The agenda packet, available on the website, includes a memo to the board, citing the developer's previous request for a $25 million deferment to the $50 million licensing fee and also a 60-day extension to the deadline.

It also addresses the incomplete application submitted on June 30, citing it as "Incomplete Physical Filing" and points out each section where the developers, Clairvest Group Inc., failed to provide a response.

Clairvest's investment banker Peter Marcil said this morning that they are trying to reach out to the Gaming Commission to clear up the misunderstanding.

"The issue regarding the license fee was resolved a while ago. We intend to pay the full $50 million at the time the license is issued just like everyone else," Marcil said.

He said the issue was resolved by bringing in additional operating partners for the non-gaming portions of the site and additional capital partners in the project.

As a result, the proposed project is changing, with a larger casino and hotel, 300 golf villas, a separate retail development, and allocation for additional residential development. The project will be done in one phase, rather than three as originally proposed.

In addition, the development team is in discussion with officials about a redevelopment project in the city's South Side, which would be completed in conjunction with the resort site, Marcil said. The project would be handled by Rodney Blackwell of Financial District properties, who specialize in riverfront redevelopment projects in distressed areas.

"We didn't want to make this announcement publicly, as we felt like our last proposal to the commission received far more media attention than we had anticipated," Marcil said. "We remain extremely bullish on the project and Montgomery County as a whole and hope to resolve our issues with the gaming commission."

Marcil said Clairvest Group Inc. CEO Jeff Parr is expected to attend tonight's meeting and hopes to dissuade the commission from disqualifying them.

Marcil said they had originally asked for a 60-day extension to the deadline for the request for application, which was turned down by the state Gaming Facility Location Board.

The board stated, "It is simply not feasible or fair to alter any provision of the RFA or make concessions at the request of a bidder. To do so would create an unfair bidding process for every other potential bidder and invalidate the RFA."

Knowing it was going to be incomplete, the Florida Acquisition Corp. submitted the application anyway, with encouragement from local officials.

Montgomery County Executive Matthew Ossenfort said neither the county nor the developer were notified ahead of time by the commission that the application may be disqualified.

"We felt like the goal was to get an application in with the idea that it could be amended and completed. We were upfront about the timing and the structuring of the RFA and we thought we could get it done with a little more time," Ossenfort said. "To dismiss the potential of this project so early in the process is a real shame, especially given the fact the project team has been making progress on the plans."

Montgomery County Economic Development and Planning Department Director Ken Rose said he was disappointed about the potential disqualification, because Clairvest Group Inc. had been working behind the scenes to complete the application.

"Numerous calls and e-mails have been sent to the commission explaining the situation but were unanswered," Rose said. "In the end we have to respect the commission's decision and hopefully at some point the state of New York will look less at the Capital District region and look at us out here and start investing in the Montgomery and Fulton County region with projects that create jobs."

In the memo attached to the application, it points out issues with the physical filing of the application and how Florida Acquisition Corp. failed to submit the required number of copies for different documents that were required.

For example, 20 hard copies of the application and its attachments were supposed to be submitted along with 10 electronic copies but only two copies of each were received. In addition, Florida Acquisition Corp. failed to submit financial statements and background information forms.

In addition, the RFA required each applicant and its respective related parties to submit with its application, a variety of materials necessary to conduct a background check on the applicant, which Florida Acquisition Corp. failed to do, according to the memo.

Those sections that were not addressed by the developer are defined in the memo with the following statement: "The submitted application was nonresponsive to this requirement."

Details of the application were made public last week, approximately one month after the applications were submitted on June 30. Upon review, the public became aware that large sections of the document were missing detail or for the most part, incomplete.

Incomplete sections of the application are defined by the following statement: "Florida Acquisition Corp., and Clairvest Group Inc. and Great Canadian Gaming Corp. will complete this section of the RFA within 60 days of the date at which the New York Gaming Facility Location Board of the New York State Gaming Commission agree with the applicant on the solution for the challenge of the License Fee as noted in the Executive Summary."

     

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