by BOB SALSBERG
---- — BOSTON — Mohegan Sun returned to the Massachusetts casino competition yesterday, reaching a deal to partner with Suffolk Downs to help develop and operate a proposed resort casino on the portion of the thoroughbred racetrack’s property in Revere.
The announcement came just one day after a recount in Palmer confirmed the narrow defeat of Mohegan Sun’s earlier plan for a $1 billion resort casino in the western Massachusetts town.
Suffolk Downs is seeking permission from the state gambling commission to shift its proposed casino entirely to Revere after East Boston voters rejected the plan. The commission has not yet ruled but is expected to further discuss the matter at a meeting next week.
Details of the deal were not disclosed, but Mitchell Etess, chief executive of the Uncasville, Conn.-based Mohegan Tribal Gaming Authority, said in an interview that Mohegan Sun along with its financial partner, Brigade Capital Management, would own and manage the casino, leasing the property from Suffolk Downs.
Etess said the goal was to create an “international tourist destination” that will benefit the region by creating jobs and economic development.
Suffolk Downs would continue to operate the 78-year-old racetrack, which is in East Boston, as a separate entity from the casino. The state’s 2011 expanded gambling law requires tracks that are awarded casino licenses to continue offering racing.
“By choosing Mohegan Sun as our resort casino developer and operator, we bring new energy and excitement to our pursuit of a gaming license — and a leader and premier brand in resort casino gaming that has been hugely successful in New England for 17 years,” said Richard Fields, Suffolk Downs’ principal owner, in a statement.
In addition to its Connecticut facility, Mohegan Sun operates casinos in Wilkes-Barre, Pa., and Atlantic City, N.J.
The search for a new development partner began in October after concerns raised in a background check by the gaming commission caused Suffolk Downs to sever ties with Caesar’s Entertainment.
Mohegan Sun and Brigade Capital have already cleared background checks — one of Suffolk Downs’ key considerations in selecting a new partner.
Voters in Palmer rejected Mohegan Sun’s proposed casino by fewer than 100 votes on Nov. 5, and a recount upheld the result on Tuesday.
Etess said the company spent five years and invested $25 million in its pursuit of a casino in Palmer, and had no choice but to move on after the defeat. He strongly denied claims made by some casino backers in Palmer that Mohegan Sun may have already been in talks with the racetrack before the town voted.
“The idea that we had any conversations with Suffolk Downs prior to the referendum is reckless and (unwarranted) and 110 percent patently false,” said Etess.
Mohegan Sun and Suffolk Downs plan to negotiate an amended host community agreement with Revere that would reflect its enlarged presence in the city. A pivotal decision facing the commission is whether the revised agreement would require a second referendum in Revere, something that could not occur in time for the panel’s Dec. 31 deadline for final casino applications.
If the bid does go forward, the Mohegan Sun/Suffolk Downs could compete with Wynn Resorts, which has proposed a casino in Everett, for the sole eastern Massachusetts resort casino license allowed under the state law.