Rivers Casino won't extend agreement with Pittsburgh's North Side, Hill District
Agreements had given $3 million each to the neighborhoods
April 18, 2013 4:00 AM
The slots-gambling era opened on Aug. 9, 2009 in Pittsburgh when hundreds of people swarmed into the Rivers Casino.
By Mark Belko Pittsburgh Post-Gazette
Rivers Casino won't be doubling down on its investments in the North Side and the Hill District.
The North Shore casino says it has "no current plans" to extend or renew the agreements that gave $3 million each to the Northside Leadership Conference and the Hill District since the gambling venue opened in 2009.
Both monetary agreements, which helped to fund a grocery store in the Hill District and neighborhood revitalization programs on the North Side, expired last year. The casino appears to be in no mood to increase the pot.
"Rivers will continue supporting Pittsburgh's neighborhoods through its ongoing community outreach programs," the casino said in a statement to the Post-Gazette.
Mark Fatla, Northside Leadership Conference executive director, said he does not see the casino's statement as the end of the discussion. "What they said is not a surprise. That doesn't mean to our minds that that's the end of the conversation. That doesn't preclude future plans. So we're happy to talk to them about the future," he said.
The agreements were the outgrowth of the competition seven years ago for Pittsburgh's only casino license. The late Detroit businessman Don Barden pledged $1 million a year for three years to both neighborhoods as part of his winning bid. He also agreed to kick in $7.5 million annually for 30 years to help pay for the construction of Consol Energy Center.
When Mr. Barden was unable to secure financing for the casino, he transferred ownership to a group led by Chicago billionaire Neil Bluhm. It agreed to honor the funding commitments Mr. Barden had made regarding the Hill, the leadership conference and the arena.
But in a bid for a property assessment reduction last year, the casino argued those obligations had become a drag on the property's worth. In evaluating the real estate for the casino, an appraiser stated that he had taken deductions against the value for the "extraordinary and unprecedented obligations" to the arena project and the neighborhoods. A casino spokesman said the assessment issue did not factor into the decision not to renew or extend the North Side and Hill agreements at this time.
On the North Side, casino funds have been used for a variety of housing and neighborhood revitalization projects.
They have gone to renovate facades on Federal and East Ohio streets; to help a developer acquire a property at Federal and North Avenue that now houses a take-out Mexican restaurant; to help spruce up sections of the Allegheny West business district; and to help renovate houses in the Brightwood neighborhood.
Mr. Fatla said $2.7 million of the $3 million awarded by the casino has been used for projects. Half was earmarked for housing and half for business development. The other $300,000 was used by the conference for operating support.
Fifty percent of the funding came in the form of grants and 50 percent in loans.
The money, Mr. Fatla said, had helped the leadership conference to leverage other funding. The loans, he added, will provide a continuing source of financing for other projects in the future.
"I think we did very well with the funds they provided. I think the communities have done well with what they were provided," he said.
Before the casino released its statement, Mr. Fatla said he was having discussions with Rivers officials about continuing the partnership. "Certainly, it's been a positive result all the way around. We think that if it's good, let's keep it going," he said.
State Rep. Jake Wheatley, D-Hill District, whose office helps with an advisory committee that makes recommendations for the use of casino cash, said there have been no "active conversations" with Rivers officials about extending the agreement.
"At this point, the Hill hasn't gone back for any requests. We are concentrating on utilizing the first gifts of money," he said.
If the Hill does decide to approach the casino again, it wants to be able to show how the initial $3 million has benefitted the neighborhood, he said. "We think we have the beginnings of some good things," he said.
Casino money has been used to help close a funding gap that had stalled construction of a Shop 'n Save grocery, the highest-profile project in the Hill.
The Greater Hill District Development Growth Fund, the repository for the casino funds, provided a $115,000 grant and a $250,000 guarantee for a loan for the project, which is scheduled to be completed at year's end. It would be first grocery in the Hill in more than 30 years.
The Hill Community Development Corp. also received $200,000 annually for three years. Another $20,000 has been awarded to help two local businesses, Mission Possible Therapies LLC and Riverside Sales Group LLC, as part of ongoing grants program.
Mr. Wheatley, who is running for Pittsburgh mayor, said one of the goals is to use the fund to leverage additional resources and dollars. Another is to build capacity and to do "catalytic type projects" that will help the neighborhood.
In its statement, the casino said that while it has "no influence or opinion" regarding how the contributions to the North Side or Hill are allocated, "we have confidence in both organizations' missions."
Carl Redwood of the Hill District Consensus Group, a local nonprofit concerned with development in the neighborhood, said he believes the casino should continue to help financially. He said there were a number of groups in the Hill that supported Mr. Barden's application for the casino license.
"They do need to give back to the community and particularly to the Hill District," he said. "The initial idea wasn't just to give $3 million. It was to support development in the Hill District."
Although the casino's monetary commitment to the North Side has ended, Mr. Fatla said the agreement is still in place as it relates to issues like parking, eliminating negative impacts of the venue, and providing job and vendor opportunities for North Side residents and businesses.
"The agreement was always about more than money. There are still many obligations between us and the casino that survive and have no end date," he said.