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Posted on: March 30, 2023, 09:42h.
Last updated on: March 30, 2023, 09:53h.
The Cordish Companies is seemingly doing the people’s work in State College, Pa., as the Baltimore-based gaming and hospitality firm continues to fight against an approved plan for Bally’s to place a casino inside the Nittany Mall near Penn State University’s main campus.
Cordish operates two casinos in Pennsylvania, Live! Casino Hotel Philadelphia and Live! Casino Pittsburgh. The latter property is a Category 4 so-called “mini-casino” that’s not actually in Pittsburgh, but in the city suburb of Westmoreland.
As part of Pennsylvania’s 2017 gaming expansion package, state lawmakers and then-Gov. Tom Wolf (D) authorized Category 4 satellite casinos in order to generate quick cash for the state. The Pennsylvania Gaming Control Board (PGCB) was tasked with issuing the Cat. 4 licenses through a competitive bidding process that came with only one grading criterion: which bidder offered the most money for the license.
The state initially only qualified current slot licensees, aka casinos, to bid. After the bidding went dry, the PGCB opened up the Cat. 4 licensing opportunities to investors who held significant ownership positions in a slot concession. That allowed former Penn State trustee and Pennsylvania businessman Ira Lubert, who owns a 3% position in Rivers Casino Pittsburgh, to bid during the state’s September 2021 auction round.
Lubert was the high bidder with an offer of $10,000,101. Lubert selected College Township for his satellite casino, a community that didn’t opt out of the Cat. 4 host location pool when it was permitted to do so.
Legal Filings
The State College community remains strongly opposed to a casino coming so near the Penn State University Park campus. Our previous coverage has garnered hundreds of comments from local State College residents who have criticized everyone from the College Township Council to Lubert. We’ve heard from only a handful of State College residents who support the casino.
Soon after winning the September 2021 auction, Lubert announced he was partnering with Bally’s Corporation to spend more than $113 million to renovate the former Macy’s department store at the Nittany Mall into a casino. But Cordish, operating in Pennsylvania as Stadium Casino RE, LLC, contends in court that Lubert violated bidding rules by orchestrating an ownership scheme prior to obtaining his Cat. 4 license.
Stadium reps allege that Lubert did not solely pay the $10 million bid, as required through the 2017 gaming law. Lubert has repeatedly denied those claims, saying Cordish is simply being a sore loser.
Stadium is appealing the PGCB’s January 2023 decision to approve Bally’s State College to the Pennsylvania Supreme Court. The plaintiffs contend that the PGCB had no right to even consider Lubert’s bid because he violated gaming regulations.
Discovery Request
Along with appealing the PGCB’s Cat. 4 licensing decision to the state’s highest court, Cordish attorneys in the interim are seeking to obtain confidential business dealings from the Lubert group. In response to the discovery request, attorneys for the PGCB say it would be best to first allow the Supreme Court appeal to play out.
The PGCB attorneys additionally say the state, and only the state, should be privy to Lubert’s confidential business communications.
Who has the legal authority to vet an application to hold a casino license in order to make sure it complies with the Pennsylvania Race Horse Development Act — the PGCB or the losing bidder for the same license?” PGCB’s legal response asked.
Cordish lawyers believe more transparency would reveal more collusion on Lubert’s behalf. The case continues.
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