The Massachusetts Gaming Commission (MGC) dismissed a last-minute appeal from Chelsea in late June, determining that the Wynn Surrounding Community Agreement (SCA) would proceed as arbitrated, despite falling significantly short of the City’s initial requests.
Chelsea had successfully negotiated one of the state’s most lucrative SCA’s with Revere’s Mohegan Sun, but the outcome with Everett’s Wynn proved far different. Following a month of state arbitration sessions that concluded in mid-June, the MGC’s arbitrator sided decisively with Wynn, substantially reducing the City’s demands across transportation, public safety, and education. Most strikingly, the City received zero funding from the Wynn SCA to address schools and social impacts.
The arbitration process ended with a June 9 decision by Arbitrator Stephen Neel, who wrote: “After hearing both parties and considering the evidence, the Arbitrator selects the Best and Final Offer of Wynn.” The MGC officially accepted this ruling last Thursday.
In a last-ditch effort to secure better terms, the City requested a vote at the late June MGC meeting. Should Wynn obtain the casino license, Chelsea’s only remaining option would be to petition the MGC after any negative impacts materialize.
City Manager Jay Ash expressed frustration with both the negotiations themselves and the state’s arbitration framework. “fblikebutton_button” “I remain disappointed with both the results of the arbitration process and the continue position of Wynn Resorts regarding potential impacts to the community from their proposed casino in Everett,” Ash stated. “Mohegan Sun has acknowledged those potential impacts and have agreed to work very closely with us to address them upfront. The position we are left in by the Wynn compact and the arbitration process is to petition the MGC after the impacts have occurred, which is absolutely ridiculous. Even if we are successful in petitioning the MGC after the fact, we can never go back and resolve the impacts, which could include crime, addiction and traffic, that would have made our petition successful in the first place. The situation about dealing with regional impacts is just one of many reasons why I believe the Mohegan Sun proposal is far superior to that of Wynn.”
The two sides had attempted to reach an SCA agreement through extended negotiations, but their positions remained too far apart. This impasse triggered a state-mandated arbitration process beginning in late April, which included six negotiating sessions involving both parties and the arbitrator.
At nearly every point of contention, the arbitrator concluded that Chelsea was overstating the casino’s potential impacts.
The starkest disagreement centered on a one-time upfront traffic mitigation payment. Chelsea sought $1.55 million to address five intersections—Marginal/Pearl, Williams/Broadway, Williams/Spruce, Parkway/Webster, and Parkway/Everett Avenue. The arbitrator sided with Wynn’s $300,000 proposal, a $1.25 million reduction from what the City requested. “After reviewing the evidence relating to traffic and transportation impacts…the impact posed by the Wynn casino on traffic at those [five] intersections will, at worst, be limited,” Neel wrote.
On annual roadway improvements, the gap was narrower. Chelsea had requested $250,000 per year; Wynn proposed $225,000, which the arbitrator approved without significant objection.
Regarding public safety, the arbitrator rejected the premise that casino-related crime would migrate to Chelsea. With 106 police officers already in place, he determined that the proposed $250,000 annual payment would suffice to cover any additional public safety needs and fund approximately three new officers.
Chelsea had sought $700,000 annually for public safety plus a $50,000 first responder fee, totaling $750,000.
Neel’s reasoning reflected skepticism about spillover effects: “The Arbitrator concludes that the Wynn casino’s security force, working with the Everett Police Department, will adequately manage any crime resulting in the immediate area of Everett from the Wynn casino; that patrons of the Wynn casino will not in any significant numbers travel three-quarters of a mile by foot form the Wynn casino property to Chelsea through an industrial area that separates the two; that some Wynn casino patrons will stay at hotels existing or to be built in Chelsea, and will travel by vehicle to and rom the Wynn casino; that the additional patrons and tourists drawn to Chelsea by the Wynn casino will cause some increase in the volume, but not the rate, of property crimes in Chelsea. Even though a significant percentage of Chelsea’s residents are undocumented immigrants, the Wynn casino will create a significant number of jobs in Chelsea. As Chelsea’s unemployment decreases, crime will decrease also. The Wynn casino does not pose a significant increase in violent crime in Chelsea.”
The report also noted that the existing officer count already represented sufficient mitigation. “The new hotels in Chelsea provided part of the rationale for the increase in the [Chief’s] force,” it stated. “Thus, any increase in tourists staying in Chelsea hotels, drawn by the Wynn casino or otherwise, has already been partially mitigated by the recent addition of officers to the CPD.”
The most dramatic outcome emerged regarding education and social services mitigation. Chelsea requested $850,000 annually to address schools and social programs. The arbitrator awarded nothing.
The arbitrator determined that school and social challenges stem from causes unrelated to the casino. “The arbitrator concludes that the educational and social conditions described by Supt. Mary Bourque, City Manager Jay Ash and others are and will continue to be caused by conditions other than impacts posed by the Wynn casino,” Neel wrote. “The $700,000 school program payment proposed by Chelsea does not fairly and reasonably address the educational impact posed by the Wynn casino, and renders the total educational and social impact payments requested by Chelsea excessive.”
The finalized SCA between Chelsea and Wynn contains these provisions:
• $75,000 annual payment enabling Chelsea to develop initiatives helping local businesses capitalize on Wynn-related opportunities.
• Wynn commits to purchasing $2.5 million in goods and services annually from Chelsea-based vendors.
• A Concierge Program to cross-market local businesses within Wynn property through the Chelsea Chamber of Commerce.
• While no specific local hiring targets are mandated, Chelsea receives secondary preference alongside other SCA communities, with Everett and Malden designated for primary hiring.
• $300,000 one-time payment for improvements to the five intersections noted above.
• $225,000 annually for traffic and road mitigation.
• $250,000 for public safety and pedestrian traffic increases, to be deployed at the City’s sole discretion.
• $100,000 annual contribution to the Chelsea Community Fund supporting cultural events, street fairs, art shows, festivals and related activities.
The agreement takes effect only if Wynn Resorts obtains a casino license and Massachusetts voters reject the gaming repeal question appearing on the November ballot.
Chelsea may reopen negotiations only if unforeseen impacts emerge that the current agreement does not address.