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Barden cleared to build casino
State's top court finds Detroit businessman fit to run slots parlor on North Shore
Thursday, July 19, 2007

Don Barden was on a golf course with singer Smokey Robinson in California yesterday afternoon, lining up a five-foot putt, when he learned the good news -- the Pennsylvania Supreme Court had rebuffed arguments that the Detroit businessman was financially unfit to run a casino on Pittsburgh's North Shore.

That means site preparation can begin right away, and construction on the $450 million Majestic Star casino, on a strip of riverfront between the Carnegie Science Center and the West End Bridge, can begin next month or the month after.

Those beginnings would put the casino on track to open by the second half of 2008, as long as Mr. Barden's PITG Gaming LLC can resolve any parking- and traffic-related scrapes with its neighbors: the science center, the Pittsburgh Steelers and the Pittsburgh Pirates.

"Now it's time to get serious," Mr. Barden said yesterday.

The Supreme Court decision ends a saga that began in 2005, when Mr. Barden submitted an application to build a casino in Pittsburgh, and rewards a decadelong friendship between Mr. Barden and Gateway Clipper Fleet owner Terry Wirginis, who supplied the property on which the casino will be built.

The high court, in a 26-page decision, said it found no reason to overturn the decision rendered by the Pennsylvania Gaming Control Board in December, giving Mr. Barden the one slot machine license earmarked for the city of Pittsburgh. The North Shore casino will be the flagship in Mr. Barden's small fleet of riverboat and budget-value casinos in Indiana, Las Vegas and elsewhere.

Two other would-be Pittsburgh casino operators, Forest City Enterprises and Isle of Capri Casinos Inc., had asked the court in May to overturn the award of the license, citing poor financial performance at Mr. Barden's other properties.

Isle of Capri wanted to build a casino in the lower Hill District and had promised to build a new hockey arena next to it to replace Mellon Arena if given the slots license.

But the value of that promise was minimized after Mr. Barden agreed to pitch in for an arena.

Yesterday, Isle of Capri spokeswoman said the company was "disappointed" in the Supreme Court affirmation.

"The Pittsburgh project presented a good opportunity," said Jill Haynes.

Forest City wanted to build a Station Square casino, which would have been run by Harrah's Entertainment, the country's largest gaming operator. Forest City officials declined comment yesterday.

Mr. Barden said he's relieved to escape the judicial system without a dint, and criticized his foes for what he characterized as "cheap shots" against his company and his reputation.

"It's unfortunate that we had to go through this process," he said. But the gambling law permitted losing applicants that chance for an expedited court review, and he respected that process, he said.

Mr. Barden's was one of five "stand-alone" slots parlor licenses authorized by the July 2004 Pennsylvania casino law. The seven-member gaming board spent all of 2006 taking testimony and considering evidence. Finally, on Dec. 20, Mr. Barden's birthday, the board announced its awards: two stand-alone licenses for casinos in Philadelphia, along with one each in the Poconos, Bethlehem and Pittsburgh.

The Philadelphia and Poconos licenses, like Mr. Barden's, were contested, but the court this month rejected those challenges.

The Bethlehem award wasn't challenged.

The Supreme Court said that its role in this process was "not to act as a super-board, employing our own discretion in determining which applicant we believe was the best applicant."

In the Barden decision, the court said that the state slots law didn't "empower [us] to sift through the voluminous evidence [that the board examined], reweighing it." Its role was "to determine whether the board acted arbitrarily or in capricious disregard of the evidence," and it concluded that the board hadn't done so.

Gaming board Chairman Tad Decker said yesterday that the board had a tough choice in Pittsburgh.

"We had a very difficult task of choosing only one licensee from three excellent applicants," he said.

Allegheny County Chief Executive Dan Onorato cheered the court's action.

"Our office is poised to work with Mr. Barden and the community to get the casino built," said Onorato aide Kevin Evanto.

Mayor Luke Ravenstahl said the city is likewise ready to pitch in.

Chief Justice Ralph Cappy and two other justices joined in the majority opinion. Three different justices filed concurring opinions. The only dissent was filed by Justice Ronald Castille, who criticized the board for "failing to conduct any of its deliberations in public" and said it should reconsider the Pittsburgh license.

Yesterday's decision sets in motion the process by which Mr. Barden will secure the casino financing from its lenders. PITG Gaming also will soon be required to pay a $50 million licensing fee to the state.

First published on July 18, 2007 at 11:31 pm
Tom Barnes can be reached at tbarnes@post-gazette.com or 717-787-4254. Bill Toland can be reached at btoland@post-gazette.com or 412-263-2625.
Read the PG's Casino Journal by Bill Toland
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