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At Public Hearing, York County Casino Backers Mum

The backers of a controversial ballot campaign to build a casino in York County had little to say during at a public hearing being held at the State House Wednesday. However, the hearing did reveal that an offshore investment company with a checkered history is backing the proposal. 

The leading Democrat and Republican on the Legislature’s Veterans and Legal Affairs Committee had hoped a public hearing on the York County casino referendum will help answer several questions about the campaign and a gambling developer who has left a trail of litigation in his past.

If approved at the ballot box, the casino could funnel millions in profits to an assortment of interest groups — schools, colleges, Maine’s Native American tribes, veterans and a harness racing industry that’s in financial dire straits. But none of those entities testified in support of the casino campaign.

“All of the various entities that stand to literally make millions of dollars if this entity were to go and nobody wants to touch this,” says Democratic state Sen. Michael Carpenter.

When asked by the committee for the campaign to testify, only Portland attorney Dan Riley did so.

Riley said he had been retained by Bridge Capital early Wednesday morning, and that he was unprepared to answer many questions about the campaign.

“I’ve never been called the morning of a hearing asking me to testify,” said Riley, who has previously testified on behalf of a range of clients at the Legislature.

Bridge Capital is a high-risk investment firm based in Saipan of the Mariana Islands. Shawn Scott is a partner in the firm, which also bankrolled an unsuccessful campaign last year to build a slots parlor near Suffolk Downs in Massachusetts.

The firm also bankrolled an unsuccessful campaign last year to build a slots parlor near Suffolk Downs in Massachusetts. The campaign originally said neither Scott nor Bridge Capital was not involved, but later paid $125,000 to Massachusetts regulators after it was revealed Scott's firm had hidden $1.6 million in contributions.

Lawmakers have a lot of questions about the casino campaign, which has spent over $4 million just to get on the ballot and has thus far operated well outside of the realm of traditional campaigns.

The committee wanted to know if the officers of Capital Seven LLC -- the firm that first brought gambling to Maine in 2003 -- are the same as Bridge Capital?  Whether the firm is paying Lisa Scott, the Miami woman who has exclusively financed the current ballot initiative? And, Riley was asked, why the campaign bills itself as supporting harness racing when the referendum does not appear to provide for construction or operation of a race track?

Scott first brought gambling to Maine after his campaign successfully convinced Bangor voters to approve slots at a race track there in 2003. The campaign originally said he was not involved.

Scott later obtained a racino license, but not before the Maine Harness Racing Commission accused him and his business associates of operating a web of shell companies and “sloppy, if not irresponsible financial management.” The report also revealed Scott and his associates were involved in over two dozen lawsuits over an eight-year period.

The trail of litigation has followed Scott and his associates ever since he sold the Bangor facility to Penn National in 2004, netting $51 million. That includes the seizure of a gambling facility run by Bridge Capital by the government of Laos two years ago over corruption charges.

The way the ballot initiative is written, Scott would be the only person who could build the casino.

“If the Bridge Capital principals are trying to get a license, I don’t think there’s a state in the country that would ever license them. It was questionable that they’d get a license back in 2003,” said Democratic state Rep. Louis Luchini of Ellsworth.

Luchini and other lawmakers peppered Riley during the hearing. Riley had little to say in response and instead characterized the casino campaign as an investment opportunity for Bridge Capital.

“If you’re successful and your upfront money is successful, then other companies like Churchill Downs and Penn National will come in and pay a real premium on the dollar,” Riley said.

But the approach taken by the campaign bristled lawmakers. Republican Ron Collins, who represents the county where the casino could be located, weighed in before leaving during the middle of the hearing.

“Bridge Capital I don’t think cares what’s in this bill … they’re going to be spending millions of dollars on advertising and it will be slick advertising. It’s just like their whole approach to this. It was slick,” he said.

Luchini agreed. He said the casino backers had paraded the proposal as if they cared about saving the ailing harness racing industry.

“When it appears very clear that their intention is to have this shell corporation, which they can flip and sell to somebody else, which is what Mr. Scott did the first time,” he said.

Riley did say Bridge Capital had been in negotiations with the owners of Scarborough Downs, but those talks have ceased. Scarborough is located in Cumberland County.

The casino initiative specifies York County as the destination for the facility. Riley said he believed the firm planned to move the Scarborough Downs racetrack to a location in York County.

Even the Maine Harness Horseman’s Association, which the casino campaign would purportedly benefit, didn’t take a position Wednesday. Bob Tardy spoke on behalf of the organization. He said it had no contact with ballot campaign and it wasn’t backing the proposal. And he said the harness racing industry will find other ways to recover.

“Not this pie in sky, what may come in the future,” he said.

It’s rare for lawmakers to hold a public hearing on a referendum that has qualified for the ballot. But the so-called Horseracing Jobs Fairness campaign isn’t operating like a typical ballot campaign. It has spent over $4 million just to qualify for the ballot — double the money Gov. Paul LePage’s re-election campaign spent two years ago and $1 million more than each of the candidates spent trying to defeat him.

The casino campaign has operated largely in secret — its known operatives turn away press inquiries despite nagging questions about a proposal that will be appearing before Maine voters nine months from now.

The proposal will appear on the ballot in November. Scott’s sister, Lisa Scott of Miami, has financed the ballot campaign.

Luchini of Ellsworth asked whether Bridge Capital is paying Lisa Scott to finance the campaign. Riley said he did not know.

Lawmakers are expected to hold future work sessions on the casino bill before likely sending it to voters.

Journalist Steve Mistler is Maine Public’s chief politics and government correspondent. He is based at the State House.