Senate panel unlikely to act quickly on casino

HARRISBURG - State senators asking questions yesterday about the rescue of a financially troubled Pittsburgh casino project by other investors found the situation more complicated and dire than they originally thought.

The prime contractor on the Majestic Star casino told them that dozens of subcontractors may quit the partially built casino next week after going several months without pay from the owner, Detroit businessman Don Barden.

Daniel Keating of Keating Building Corp., Philadelphia, said that if work does not restart by Wednesday - when the project could go into bankruptcy - subcontractors will have the right to terminate their contracts, driving up costs and complicating the construction schedule.

"I'm very concerned that if someone were to exercise that right, it would kill the project," Keating told senators during yesterday's four-hour hearing by the Community, Economic & Recreational Development Committee.

Senators who are already poised to scrutinize each step by state gambling regulators as they review the 11th-hour rescue of Barden's casino by a new partnership insisted that nothing could be finished by then. The partnership that has evolved in recent weeks is spearheaded by billionaire real estate investor Neil G. Bluhm of Chicago.

Bluhm is also the primary investor in Philadelphia's stalled SugarHouse Casino.

"I'm not sure how anyone could think the Pennsylvania Gaming Control Board could approve anything in that short of a time frame," said State Sen. Jane Earll (R., Erie County) the committee chair.

The casino project hangs in the balance, and with it, the tens of millions of dollars a year that the state will take from the site's slot-machine gambling revenue and use for tax cuts - Gov. Rendell's original justification for legalizing slot machines in 2004.

Underscoring the project's high profile, Rendell himself helped referee disputes among the emerging partnership while State Rep. Dwight Evans of Philadelphia, the House Appropriations Committee chairman, lobbied two gaming board members.

But several senators expressed concern that the rescue bid is rushing the gaming board's review, ensuring that the agency will repeat what the senators said was the mistake of giving Barden a license in the first place. They implored the board simply to revoke Barden's $50 million casino license, and offer it to a new group of competing applicants - a process that could take a year to complete.