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Questions raised about casino plans
BREAKING GROUND — In this July 29, 2011 photo, soil is moved at the location where a new casino is being built in Oxford. Black Bear Entertainment last fall campaigned for a casino in western Maine, promising to build a $165 million, four-season resort with a casino, hotel, restaurants, conference space and a spa. But questions are now being raised about those plans because of referendums in November asking Maine voters if they want to allow casinos in Biddeford and Lewiston.
PORTLAND, Maine (AP) — When the company that campaigned for a casino in western Maine pitched the idea to voters last year, it said it planned to build a $165 million destination resort with a casino, hotel, restaurants, conference space and a spa.
Questions are now being raised about those plans because of referendums on November's ballot asking Maine voters if they want to allow more casinos in Biddeford and Lewiston. If those casinos are approved, some people say it wouldn't make economic sense for the developers of the Oxford Resort Casino to carry out their expansion plans in the future.
A 2008 market analysis of the Oxford site estimated that the total gambling market within a 2½-hour radius of Oxford was about $130 million a year, enough to support a small casino and resort, said Clyde Barrow, director of the Center for Policy Analysis at the University of Massachusetts-Dartmouth. The center runs the New England Gaming Research Project, which tracks the gambling industry in the Northeast.
But if other casinos are built in southern Maine, Oxford would lose customers, its business model would deteriorate and job creation would fall far short of projections, he said.
"The Oxford casino can meet the specs that they laid out as a phased-in development over a period of years," Barrow said. "But I think if you put facilities in Lewiston and Biddeford, phase one is all you get — which is a slot parlor with some table games."
Black Bear Entertainment LLC officials aren't speculating on what the final project will look like if voters approve a casino just 20 miles away in Lewiston, Maine's second-largest city, or along the busy Maine Turnpike corridor 55 miles away in Biddeford. The company now plans to first build a casino with a restaurant, and add a hotel, spa and conference space in the next few years.
Nobody will know until after November's election how many more casinos — if any — will be built in Maine, said Rob Lally, one of Black Bear Entertainment's partners.
"We've said all along we plan to crawl, to walk and to run and to try not to overbuild it so we don't find ourselves in a bad situation," he said. "We're comfortable where we are and we're excited."
Maine voters narrowly approved allowing a casino with slot machines and black jack, craps and other table games in Oxford, a small town in western Maine about 45 minutes northwest of Portland.
During the campaign, Black Bear pitched the development not just as a casino, but as a four-season resort that would support thousands of jobs, pump tens of millions of dollars into the economy and generate more than $60 million in tax revenue. An artist's rendering of the proposed development showed an elegant, sprawling resort.
But in less than four months, Mainers will vote on two more statewide referendums: One will ask if a casino with table games and slot machines should be allowed in Lewiston, and the other will ask if slot machine facilities should be allowed at horse race tracks in Biddeford and Washington County. Residents in Penobscot County will also vote on a county-wide referendum asking if table games should be allowed at Hollywood Slots, a Bangor casino that now has only slot machines.
Both Lewiston and Biddeford have bigger population bases than Oxford by far and are located on major interstate highways, putting them at a distinct advantage over Oxford. If Hollywood Slots gets its table games, that would give gamblers from the Bangor region one less reason to go to Oxford.
Atlantic City is a case study of how competition can take a toll. Five years ago, gamblers wagered more than $5 billion there, but it's taken a pummeling since then, with the bad economy and new casinos on its doorstep in Pennsylvania, New York and Delaware. Analysts say Pennsylvania is poised to take over Atlantic City's ranking as the nation's No. 2 casino market next year.
In Oxford, workers are preparing a 100-acre site along Route 26 for the Oxford Resort Casino. The foundation is expected to be started by the end of August and the enclosed framework of the building should be complete in November so that interior work can be done over the winter, said Scott Smith, Black Bear Entertainment's community development director. The casino, which will be the size of a typical supermarket, should open late next spring, he said.
Black Bear officials are hesitant to talk about the future expansion plans, other than to say they're moving forward and will have to wait for the results of November's referendums.
Even if the ballot measures calling for casinos in Biddeford and Lewiston fail, attorney Steve Hinchman has his doubts about the Oxford development growing beyond a "slot-machine barn," as he and other critics refer to the facility. Hinchman represented a group of Oxford landowners and the Androscoggin River Alliance in challenging the environmental permits for the project.
The casino location doesn't have adequate water supplies or sewage facilities to handle any expanded development, Hinchman said. He also has doubts about the economics of expanding given its remote location off the beaten path.
"The Oxford casino site is the wrong location for a full-service casino in Maine," he said. "It's in a rural, undeveloped area, there are no water or sewer services, it's not really near a population base and it sits perched on a hillside immediately above four lakes that are designated by the state as lakes most at risk from development. It's really the wrong place for a casino in Maine."
Local supporters of the casino are glad to see work progress on the site, but even they wonder what impact the other referendums might have on the long-term plans of the resort.
If Maine voters give their blessing for more casinos, then Black Bear will have some decisions to make, said Floyd Thayer, chairman of the Oxford Town Council and a local business owner.
"If three more casinos are going to be built in Maine, will they expand the Oxford site from the get-go? I'm sure it's got to have an effect on it. Who knows?" he said.