SPRINGFIELD, Mass. (AP) - MGM Resorts International was chosen Tuesday by Springfield officials as the preferred developer for a resort casino in the state's third-largest city, beating out a competing proposal from Penn National Gaming.
MGM is seeking to build an $800 million resort casino on 14.5 acres of land in the city's South End that sustained extensive damage in a June 2011 tornado.
Mayor Domenic Sarno announced that he had negotiated a host community agreement with the company that would include annual payments to the city of more than $25 million a year, if the casino is built.
The agreement must be approved by the Springfield City Council and by city voters. City officials said they are aiming to hold a referendum on July 16.
The state's 2011 gambling law allows for up to three regional resort casinos, including one in western Massachusetts. The state's gambling commission will make the final determination, likely in early 2014.
"We feel very strongly that we have the best location to offer in western Massachusetts, if not the state," Sarno said of the MGM proposal.
Hard Rock International has proposed a casino in West Springfield and Mohegan Sun has a plan in the town of Palmer.
The proposal offered by Penn National Gaming - in partnership with Peter Pan Bus Lines chairman Peter Picknelly - called for a casino and hotel project on a 13.4-acre parcel in the North End that is now home to a newspaper and a bus terminal.
Sarno said he never seriously considered negotiating host community agreements with both companies, though that was an option for the mayor.
"We need to move forward together as one," he said.
The mayor said he called executives of both companies to deliver the news, and thanked Penn National for their investment.
The company submitted a preliminary application to the Massachusetts Gaming Commission along with a $400,000 non-refundable fee. The company could conceivably seek to build a casino elsewhere in the state.
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