Penn National’s permanent racino deal signed

BANGOR – The leaders involved in the effort to develop a $72 million gambling complex across Main Street from Bass Park have crossed the finish line.

All of the essential documents pertaining to Penn National Gaming Inc.’s permanent racino project, including purchase and lease agreements, a development deal and a 46-page final lease agreement, have been signed, City Solicitor Norman Heitmann confirmed Friday.

Friday was the deadline city councilors set earlier this month when they approved the agreements in separate unanimous votes. Besides Bangor and Penn National, the multi-party deal involved Kevin Mahaney, owner of the Holiday Inn-Civic Center, and Chou Lin, owner of the Main Street Inn, which was torn down last week.

The signing of the documents marks the end of months of sometimes intense negotiations involving representatives from the city, developer Penn National and the owners of the Main Street Inn and the Holiday Inn-Civic Center, which is expected to remain open until late this year.

City officials see the project as one that will enhance the local economy and spur new development.

“This triangular deal [among the city, the developer and the property owners] sets the stage for moving ahead with the bigger racino and the new auditorium,” City Council Chairman John Cashwell said late Friday afternoon in a telephone interview.

“Now we can stop focusing on that [negotiations] and get on with other developments in the works. This will give people confidence” in the future vitality of the Main Street commercial corridor, Cashwell said.

Efforts made late Friday afternoon to reach Penn National and racino officials were unsuccessful.

Construction on the new complex, which will be located on Main Street across from Bass Park, is slated to begin next year or 2008, depending on the outcome of talks with the last remaining lease holder, the real estate firm Re-Max Advantage, the owner of which, Carolyn Fish, holds a lease on her company’s building for another two years.

“It’s only a matter of timing,” Heitmann said. “Her lease runs through February of 2008, and she has a right to be there until then.

“So there is a business decision she has to make, and we have to respect that. In the meantime, the city remains ready to work with her and provide any assistance we can,” Heitmann said.

City councilors last year adopted a policy under which racino revenues will be used to replace the city’s aging auditorium and civic center at Bass Park. They hope to break ground on a replacement facility, likely an arena, by 2011, according to city Finance Director Debbie Cyr.

Penn National now is operating its temporary racino, Hollywood Slots at Bangor, located in the former Miller’s restaurant building on Main Street. The facility has been operating for about half a year.

According to city officials, the permanent racino will almost quadruple the Pennsylvania-based company’s current work force of about 130 employees and generate at least $2.1 million a year for the city in the form of property tax and lease payments and the city’s share of slots revenue.

The city already has earned well over $500,000 from Hollywood Slots.

Penn National’s permanent gambling complex, which will house up to 1,500 slot machines, is proposed for the so-called Riverside Block, which encompasses the land between Lincoln and Dutton streets from Main Street to the railroad tracks.

The permanent racino will replace Hollywood Slots. It will include a parking garage, restaurant and retail space.

Penn’s off-track betting operation, now operated out of the grandstand at city-owned Bangor Raceway, also will be housed in the new facility.