The Pennsylvania Gaming Control Board gave the green light again Wednesday for Stadium Casino L.L.C.’s proposed casino and hotel in South Philadelphia.
The board voted 7-0 that wealthy businessman Watche “Bob” Manoukian does not, and will not, hold a financial interest in Stadium that exceeds 33.3 percent, and that Stadium is in full compliance with the state Gaming Act.
The board agreed with Stadium’s argument based on evidence and testimony on July 31 from Manoukian, who said that he will transfer $34 million to a trust for his sons that will own a portion of the proposed casino. Manoukian said he will fund the trust by “irrevocable and outright gifts” and that he has no monetary right or claim, or investment in, the trust.
By a roll-call vote, the gaming board approved a motion that “Watche Manoukian does not maintain a financial interest in Stadium Casino L.L.C. through either the Sterling Investors Trust or Sterling Fiduciary Services Inc.” Funding the trust by gifts did not “rise to a financial interest.”
In June, the Pennsylvania Supreme Court sent the case back to the gaming board for a further evidentiary hearing. Based on a special hearing and legal briefs, the board concluded Wednesday that Manoukian, who owns an 85.84 percent interest in Parx Casino in Bensalem, did not violate casino ownership restrictions in the proposed Live! Philadelphia Casino & Hotel in South Philadelphia.
The law prevents an individual who owns one casino from owning more than 33.3 percent of another.
Manoukian has a net worth of $850 million, according to board documents. His company, Greenwood Racing, formed a 50-50 partnership with entities controlled by the Cordish family in Baltimore.
The gaming board picked the joint venture Stadium to build Philadelphia’s second casino in November 2014, but state Supreme Court appeals by a losing bidder and by SugarHouse Casino, the city’s first casino, have delayed the project.
The June Supreme Court decision was the second time the award of the second Philadelphia license to Stadium Casino was sent back to the gaming board for further consideration.
Philadelphia lawyer Richard Sprague, on behalf of SugarHouse Casino, said Wednesday, “It’s very easy to say ‘I’ve given a gift to my children.’ What’s the source of the money?” Sprague said. “Stadium was asked, but did not answer, the exact source of the funds of that $34 million gift.”
“The answer was ‘multiple sources,’ ” Sprague said, adding, “Someone should take the depositions of the sons.”
Cyrus Pitre, chief enforcement counsel for the gaming board, said investigative staff at the gaming board have done background checks on Manoukian and “plan on tracing the source of that gift.” SugarHouse’s position “borders on complete arrogance,” Pitre said.