Developers bidding for three potential downstate casinos have expressed concern that required environmental impact studies the New York State Gaming Commission is legally required to perform will not be complete in time for a Sept. 30 deadline. The studies concern the plans that the bidders have for the proposed casino sites. Without complete studies, the associated bids would fail to meet requirements for consideration and be disqualified.
While the Commission has provided assurances that the studies will be complete in time, any delays in the performance of the studies could provide fodder for parties that don’t receive licenses to claim that the bidding was unfair to their interests. Legal action challenging the award of the licenses might be a foregone conclusion but these complaints might signal bases for that litigation.
Developers express fears of missing study deadline
According to Daniel Garber of Crain’s New York, developers associated with bids to develop casinos in Hudson Yards, Times Square, and near the United Nations building have all voiced concerns about whether the requisite environmental impact studies will end their projects before they even start. Environmental impact studies try to prognosticate the effects of a development on the landscape and populations in the immediate areas.
Parties to those bids included in the Crain’s report feature:
- Hudson Yards – Silverstein Properties and Wynn Resorts
- Times Square – Caesars Entertainment and SL Green
- UN District – Mohegan Gaming and the Soloviev Group
The Real Deal New York reports that an attorney representing one of these partnerships claimed that the New York State Gaming Commission (NYSGC) hasn’t “even started the process” of completing the studies. Meanwhile, similar studies for other possible bids that are not reliant on the NYSGC are either underway or complete, raising concerns about certain bidders having an early advantage in the competition for the up to three licenses the NYSGC plans to award by the end of 2025.
At the same time, a representative from SL Green told The Real Deal that it is not concerned with the deadline and a statement from the NYSGC that The Real Deal shared communicated assurances that studies would be completed prior to the Sept. 30 deadline. The NYSGC also has discretion to extend its deadlines at this point.
If studies do fail the deadlines and the NYSGC does not give itself more time, that would be a natural precursor to litigation. Because of the enormity of the opportunity to develop a casino in southern part of New York, lawsuits might be inevitable, anyway.
NYSGC under the microscope
The chance to develop and operate a casino in the second-most populous city in North America represents a generational opportunity for any company. That’s why the bidding floor for the licenses is half a billion dollars and bidders will also be incentivized to propose a generous revenue share for the state in their proposals.
With billions of dollars at stake, parties that are not selected for licenses are unlikely to simply express disappointment and move onto other interests. Rather, parties are likely already chronicling every event in the process that could be potentially used as rationale to claim that government agencies and/or officials acted improperly.
NYSGC staff failing to meet a deadline for its components of bids would be a natural fit. Public statements expressing concern over the process at earlier junctures would strengthen the narrative. Even if the NYSGC does issue licenses before the calendar turns to 2026, there will likely be lawyers.
If any of these studies are not complete by Sept. 30, that could dictate what those attorneys focus on.
