May 21, 2010 Volume 111 Number 10

Building trades back bid for private casino

A proposed private casino in east Multnomah County has won support of the Columbia Pacific Building and Construction Trades Council.

Lake Oswego financial consultant Bruce Studer and lawyer Matt Rossman on May 7 announced formation of a financial partnership to fund construction of a casino and entertainment center at the defunct Multnomah Kennel Club in Wood Village east of Portland.

Plans are in the works to build the complex under an all-union project labor agreement with CPBCTC.

In order to proceed, however, the developers must secure two ballot measures. The men have formed a political action committee called the Good for Oregon Committee.

One measure is a constitutional amendment creating an exception to allow one private casino to operate in Oregon. The second measure details how much will be spent initially to build the casino ($250 million) and where some of the profits will go. The initiative authorizes 25 percent of adjusted gross gaming revenues — estimated at more than $186 million a year — be dedicated to K-12 education and other public services.

Studer told the Labor Press that by statute, half of the 25 percent would go to schools and 30 percent would be shared by every county in the state, with allotment based on population. The Oregon Lottery Commission would regulate all distributions.

Oregon requires 110,358 valid signatures for a constitutional amendment and 82,769 valid signatures for a change in state law. The initiatives must be turned in by July 2 in order to appear on the Nov. 2 ballot.

With its endorsement, affiliates of the Building Trades Council pledged to help collect signatures.

The Good for Oregon Committee has contracted with Democracy Resources of Portland for signature gathering. About 100 people, some of them laid-off construction workers, have been hired to collect signatures throughout the state.

“Our biggest hurdle is getting the signatures in time,” Studer said. “The more hands we have on deck, the better off we’ll be.”

This is Rossman’s and Studer’s third attempt at building the entertainment complex. They first showcased the project — a “world-class entertainment center” that would, in phases, include a luxury hotel, fine restaurants, a spa, shopping, a movie cinema, live theater venues for local, national and international stars, a bowling alley, and water park — at a press conference at the Kennel Club in April 2006 with public officials and union leaders.

But their initiatives to allow for construction never got to the signature-gathering phase due to delays getting ballot titles approved by the secretary of state, then by a challenge before the Oregon Supreme Court.

The ballot titles were certified and cleared by the courts, but in 2008 they couldn’t find enough backers to run a signature-gathering campaign.

This month they came forward with two initiatives and a half-dozen financial backers who are ready to move the project forward.

“This partnership group is committed to the building and operating of the Resort Casino and Entertainment Center the Oregon way — constructed by union craftspeople using local suppliers, and incorporating state-of-the-art green building techniques,” Rossman said.

John Mohlis, executive secretary-treasurer of the Columbia Pacific Building and Construction Trades Council, said the announcement couldn’t come at a better time. “Job creation is one of the most important issues facing Oregon right now,” he said. “We have anywhere from 25 to 50 percent unemployment in the trades and no real big projects on the horizon.”

The project is expected to create hundreds of direct construction jobs, generating a $286 million annual payroll. The facility itself is expected to provide 3,000 permanent jobs, and an additional 2,300 indirect jobs.

“These will all be local, family-wage jobs,” Mohlis said.

If successful at the polls, construction most likely wouldn’t begin until the third or fourth quarter of 2011.

The partnership group behind the casino and entertainment center are:

  • Oregon Gaming & Entertainment Co., principals Studer & Rossman: an Oregon-based investment company;
  • MGP Racing LLC, principal Arthur McFadden: owner of Multnomah Greyhound Park;
  • Navegante Group: A Las Vegas-based hospitality company specializing in casino development, consulting and management;
  • Clairvest: A Canada-based investor in North American gaming-development companies; and,
  • Innovation Capital: A Los Angeles-based gaming, leisure and hospitality investment banking firm.

Studer emphasized that the partnership group is not requesting “a dime of taxpayer subsidy or special treatment” to build and operate the facility, and it will pay its full share of taxes — in addition to the 25 percent for schools and other services.

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