PITTSBURGH -- The possible revocation of Don Barden's state casino license could delay construction of Pittsburgh's slot machine casino -- and the millions of dollars in revenue it's projected to generate -- for years, according to the mayor.

Watch the full report from Action News reporter Bob Mayo: Pittsburgh Casino Faces Long Delay If Barden's License Taken

Pittsburgh Mayor Luke Ravenstahl spoke to reporters after a Tuesday morning meeting with Allegheny County Chief Executive Dan Onorato and Doug Sherman, the acting chief counsel for the Pennsylvania Gaming Control Board.
Video: Ravenstahl Talks About The Meeting

"We made the general determination that if the slots license were revoked and reissued, we're looking at one, two, three, maybe four years for the re-issuance ... process to take place," Ravenstahl said.

The mayor added, "My two big issues: No. 1, the financing and making sure that the new ownership group has the financial capability of financing the deal, and secondly, of course, the commitments that have been made to the city of Pittsburgh."

Onorato and Ravenstahl hope the gaming board will act soon, but they want board members to make sure the proposed new investors are financially fit to meet Barden's prior commitments -- and if that takes weeks, they said it's still better than starting over from scratch.

"Of course, we want to get it right this time," said Ravenstahl. "We're talking about maybe the end of this week or next week. That is a small time frame when you consider what a revocation of a license could be."

"The staff and this board (are) going to fully vet this joint petition, and our primary purpose is to protect the public interest and this will be fully vetted," said Frank Donahue, executive director of the gaming board.

Stay with WTAE Channel 4 Action News and thepittsburghchannel.com for updates throughout the day.
Video: Community Leaders Weigh In On Gaming Board Meeting

New Financing Proposed For Casino

Barden and Neil Bluhm are asking the board to approve their bailout plan for the $780 million slots casino project, which was awarded to Barden's PITG Gaming in December 2006. Barden said he has been unable to line up enough financing to move ahead.

"I assume that he (Bluhm) does, but the gaming board has the legal authority to make sure and verify and vet him out now and make sure that he does, in fact, have the liquidity to pull this off," Onorato said.

The proposal calls for Barden's casino license to be transferred to a Bluhm-led group that would infuse new money into the project, with a new CEO to replace Barden, who would be a 25 percent partner.

According to Ravenstahl, Sherman said that if Barden's license is revoked instead of transferred, Barden could challenge it in court, leading to a lengthy legal battle.

Construction has stopped because contractors on the job are owed millions of dollars. Bluhm told the gaming board that the deal needs to be approved quickly or it could fall into bankruptcy, which he said could delay the opening for up to four years.

Credit Suisse -- the casino's major creditor -- had no comment on if and when it intends to force the Pittsburgh casino project into bankruptcy.

Daniel Keating, chairman of general contractor Keating Building Corp., said dozens of subcontractors have the contractual right to quit this week, and he's concerned that it could kill the project.

Spokesman Doug Harbach said the gaming board is still reviewing paperwork and is in no position to meet any deadline or schedule a public hearing on Bluhm's proposal yet. Public hearings must be advertised at least 24 hours in advance.

"The board will not compromise its process which it's obligated to go through for any reason," Sherman said.

State Lawmakers Debate Casino License 'Transfer'

State Sens. Jim Ferlo and Jane Orie don't want Bluhm to simply be handed a license. They've asked the gaming board to re-start the project from scratch and open it to competitive bidding, which is how Barden originally got his license in December 2006.

"I haven't heard what the board has done with anyone else that may be thinking about it," Onorato said. "Did (former license bidders) Isle of Capri or Forest City look at this? Were there other people saying they wanted to invest? We hear rumors, but I don't know. The gaming board has to make that decision."

The casino was projected to open in 2009. Barden originally promised $7.5 million a year to help build the city's new multipurpose arena, and the city is counting on slots revenue in 2010 budget projections.

Onorato said the board needs to "find an owner that is financially strong, that is willing to live up to all the commitments that were made when Don Barden was awarded the license, and that all of the items that were in that commitment are fulfilled."

Bluhm has promised to honor the prior commitment for arena funding, "but let's not forget Don Barden promised that a year and a half ago, and now he's having financial difficulties," Onorato said.

Members of the gaming board are not allowed to discuss ongoing cases involving licenses. Instead, Sherman and acting executive director Frank Donahue attended the meeting in Pittsburgh on Tuesday.

"The staff and this board is going to fully vet this joint petition," said Donahue. "Our primary purpose is to protect the public interest and this will be fully vetted."

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