Mayor Nutter yesterday said he had no "thought or intention" of paying the $14 million annual price tag for policing the areas around the two planned riverfront casinos, though the city agreed to foot the bill.
The real cost of hosting two casinos with 10 million annual visitors emerged yesterday in City Council as Deputy Mayor Everett Gillison outlined the 160 officers needed to control traffic and keep order around the facilities licensed by the state for the Philadelphia waterfront.
Gillison, in written testimony, estimated first-year costs at $18 million - including a new $3.3 million facility for the special unit - with subsequent annual expenses of $14.3 million.
That figure should have come as no surprise. In 2005, Mayor John F. Street's Gaming Advisory Task Force placed annual casino-related police costs at $11 million to $16 million.
But Nutter told Council's Rules Committee yesterday that he had not budgeted for any of these costs in his five-year plan - "none of which we should have to pay for as the City of Philadelphia."
Nutter has anticipated that the estimated $28.6 million in annual casino "host fees," including $5 million for the School District, will begin to flow into city coffers by mid-2010. He included those figures in his five-year plan. That would require construction of the Foxwoods and SugarHouse Casinos to begin immediately.
And while Nutter said the city should not pay for funding the extra police, Street signed an agreement with Foxwoods three days before Nutter took office to do just that.
In that Jan. 4 document, Foxwoods agreed to pay the city from $5.3 million to $7 million annually, though it could have claimed the city's tax abatement on new development and paid nothing in property taxes for 12 years. It also agreed to fund $30 million in traffic and sewer improvements.
SugarHouse signed a similar agreement in August.
Representatives of both casinos said yesterday their contributions toward police were covered by those documents.
Both deals state that the city will pay for all "policing obligations" out of those payments and the more than $28.6 million Foxwoods and SugarHouse is set to pay the city and School District in host fees.
Yesterday, Nutter called the agreements "deficient and inadequate" and said he was "examining all of our legal options."
"It is certainly not the kind of agreement I would have signed," he said. "When you look at it on its face, it would appear that the city got the short end of the stick in that agreement."
The agreements are the subject of a Council Rules Committee hearing set for this month. That hearing and yesterday's hearings were nearly canceled following a state Supreme Court ruling Wednesday that stripped Council of any regulatory authority over Foxwoods. The court found that Council forfeited its authority by intentionally delaying action. The court ruled similarly for SugarHouse in December.
But Council went on with testimony yesterday, drawing a surprise appearance from Nutter, bristling from the implications of the court's ruling on city autonomy.
"What has happened in the past few days is that the long arm of the judicial branch has reached into this City Council, snatched out this Council's will and ability and political responsibility to represent the interests of the citizens of this city, disrupting a legislative process that was in progress," Nutter testified before the Rules Committee.
Foxwoods attorney Carl Primavera, in a statement, said: "We recognize the role of the city going forward and anticipate that the city (and Council) will fulfill its obligations under the law."
And while Nutter said he was exploring all his options to countermand the court's decision, his and Council's leverage wanes with each unfriendly court ruling.
In an interview yesterday afternoon, however, Nutter stressed that the city had some options.
He warned Foxwoods, and perhaps state officials, that the city still has some say over the project, on Columbus Boulevard in Pennsport. Because only Phase I of the project has been approved, Nutter said, subsequent phases that include a 1,000-room hotel and condo towers and more slot machines might never happen, leaving Foxwoods with only a warehouse-like "slot box" on the Delaware.
"The Foxwoods people need to be concerned about that themselves," Nutter said. "It should be rather obvious to them that they're not going to see the financial return they're looking for.
"This is not a game, this is not a joke, this is not just roll-over-and-let-things-happen - those days are over," Nutter said. "I want to make it very, very clear that the City of Philadelphia takes these issues very, very seriously, and the casino operators should be prepared to engage in much more serious discussions and an exploration of their obligations to the City of Philadelphia than they have in the past."