MGM sets goals for National Harbor casino project’s local hiring, contracting


A rendering of the arrival to MGM National Harbor. (MGM Resorts International )

MGM Resorts International and Prince George’s County officials have reached an agreement that sets employment and procurement goals for the construction and operations of the $925 million casino resort planned for National Harbor.

Some of the goals relate to the casino giant’s hiring and contracting within the county and with companies owned by minorities. MGM also has committed to investing $1 million in the county before the casino opens and to contribute $400,000 to the county annually while the casino is in operation.

For months, officials with the Prince George’s county executive’s office and MGM worked behind closed doors to negotiate the agreement. But that drew criticism from residents, civic leaders and County Council members who said they were being left out of the negotiations.

County officials said Tuesday that they were pleased with the outcome of the negotiations and touted the agreement as a significant step toward ensuring that the Prince George’s community gets its fair share from the project.

“We have reached a deal with MGM that ensures this facility will have a transformative impact on our residents, businesses and communities,” said County Executive Rushern L. Baker III (D). “The goals for local hiring and contracting in this agreement are both ambitious and fair.”

Those negotiated benefits, officials say, are in addition to the projected $40 million to $45 million the county is expected to receive annually from gaming revenue and through property and other taxes. The state also is anticipating substantial annual revenue from the casino, which is expected to generate $700 million or more annually by its third year.

In December, Nevada-based MGM was awarded Maryland’s sixth and final casino license. The company will build a luxurious casino on 23 acres overlooking the Potomac River. Plans call for the gambling resort to include 3,600 slot machines, 140 gaming tables, a glass-tower hotel with 300 suites, a concert theater, several celebrity-chef restaurants, a spa and high-end stores.

As part of the deal, MGM has agreed to do its best to ensure that 40 percent of its workforce is from the county when the facility opens in July 2016. That amount would increase incrementally over five years to 50 percent.

MGM says, however, that it aspires to have 50 percent be county residents on the first day.

MGM also has committed to having 20 percent of its construction workforce be county residents. Under the agreement, at least 30 percent of construction contracting would go to businesses owned by minorities and at least 12 percent to minority businesses based in Prince George’s.

Bradley W. Frome, a top economic development aide to Baker, said the goals address residents’ and county officials’ worries that the project could exclude the local workforce, county and minority-owned firms as well as veterans.

The agreement sets a compliance mechanism, including the creation of an oversight committee, to ensure that MGM meets the goals.

If the committee determines that the company has failed to make “best efforts,” MGM could be required to make additional charitable contributions to the county.

But some residents remain concerned that the county’s best interests were not represented during the negotiations.

“Right now, we have no idea what the community is going to get out of this project,” said the Rev. Charles W. McNeill Jr., pastor of Unity Baptist Church in the District.

The Fort Washington resident said the community wants to see MGM invest in social programs, community centers, and public safety and educational campaigns that could address any effects the gambling industry has on the county.

“We want to make sure that there are investments in the infrastructure, that there is a community center the neighbors can use, that there is a relationship with the churches and funding for programs for people who may lose their homes or people who have alcohol problems,” said McNeill, who is co-chairman of the Business and Clergy Partnership.

Frome said the agreement ensures that 1,900 of the projected 3,800 jobs go to county residents and sets specific goals for contracts for county-based firms.

A similar agreement made for the National Harbor project, for example, did not specifically differentiate between minority-owned businesses and minority-owned businesses based in Prince George’s.

“We looked at what is a number that is aggressive and that provides opportunities for county-based firms and residents,” Frome said.

MGM’s commitment to invest $1 million in the county before the casino opens is said to help local nonprofit groups and the formation of a workforce. Half of the funds would be distributed among organizations providing workforce training, including Prince George’s Community College, the University of Maryland at College Park and Bowie State University.

About $250,000 would go to the Community Foundation for Prince George’s County, which is an advocate for the county’s nonprofits and handles other community funds, including the National Harbor Community Outreach Grant Fund.

After the casino opens, MGM would continue to give $400,000 annually to the county through the Community Foundation and other organizations that benefit Prince George’s.

The company also plans to start a culinary program at Potomac High School in Oxon Hill, which would include the donation of kitchen equipment and teaching assistance. MGM also will have an internship program for students enrolled in county schools or who have at least one parent who is a county resident.

The agreement does not include investments in transportation infrastructure to address traffic concerns around the 23-acre site.

MGM is expected to file a separate transportation plan with the state.

In addition, investments in the neighborhoods near the casino will come mostly through gaming revenue and could include $9 million for public safety and other local infrastructure, officials said.

The County Council, which last month adopted legislation to ensure that the agreement was negotiated, is expected to review the deal and vote on it next month.

Luz Lazo writes about transportation and development. She has recently written about the challenges of bus commuting, Metro’s dark stations, and the impact of sequestration on air travel.
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