His right hand tap-tapped his heart -- twice for emphasis -- as he
apologized to the members of the Lincoln Town Council for turning his
back to them so he could face the rows of people who filled Town Hall
that night.
Then, the tall, graying lawyer turned to the audience and introduced
himself: "Ladies and gentlemen of the town of Lincoln, my name is Dan
McKinnon and I represent Lincoln dog track."
And, "What we are attempting to do this evening is to continue, in our
opinion, to be good corporate neighbors," the law partner of then-House
Speaker John B. Harwood told the people of Lincoln.
What unfolded over the next several hours remains the subject of
litigation and controversy.
A citizens' group sued to strike down the zoning changes the council
approved that night to allow the track to erect what at one point was
described as a $50-million building to house 1,300 more video-slot
machines.
A majority of those who were on the Town Council say they still cannot
explain how words allowing Lincoln Park to petition the town to become a
full-fledged casino became a part of a side agreement they approved that
September 2001 night.
A draft of the agreement, given council members the night before, would
have required Lincoln Park to "forever waive its right to operate any
and all 'casino type' table games." Between that night and the next,
words were added that said something else entirely.
"I just didn't know who changed the wording and I questioned everybody
after. But, you know, I don't know," former Lincoln Town Council
President Raymond N. Depault said recently. "Somewhere along the line
something changed."
A VIDEOTAPE of that Sept. 18, 2001, Town Council meeting provides a rare
glimpse of House Speaker Harwood's 58-year-old cousin and law partner,
Daniel V. McKinnon, in the role he performed for Lincoln Park for close
to a decade.
In that 10-year time frame, video slots grew from a novel notion hatched
in the final hours of the 1992 legislative session to help the
struggling greyhound track survive, to an $833.8-million-a-year business
for the track.
At various times, McKinnon has been the track's defender, negotiator,
pitchman, frontman -- and conciliator, as he was that night in Lincoln.
Talking about the lawsuit he had filed against the town years earlier to
protest the adoption of land-use restrictions that put most of the
track's 191 acres off-limits to development, McKinnon said: "The last
thing Lincoln [Park] wants is to win that lawsuit."
"What do we win?" he asked the audience rhetorically.
"A few million dollars and we get our zoning and we have a city council
that is angry at us and we have a community that is angry at us." Not
good enough, he told his Town Hall audience. "We want to live in the
community." That McKinnon & Harwood did legal work for the track has
been widely known since May 1994, when The Providence Journal reported
McKinnon's appearance on Lincoln Park's behalf at a Department of
Business Regulation hearing. By then, Harwood was in his second year as
speaker of the Rhode Island House of Representatives.
Top track executive Dan Bucci told The Journal that Lincoln Park hired
McKinnon because "we think very highly of Danny personally and
professionally. When you go for dates, you want to get the best possible
representation."
In a 1999 interview, McKinnon said he and Harwood never discussed the
legal work their firm did for Lincoln Park to avoid even the potential
for a conflict of interest.
McKinnon has declined to say whether Harwood shared in the fees Lincoln
Park paid their firm. He said: "What Mr. Harwood and I do not do, is we
do not discuss any cases in the office that have any impact on
government."
But an indictment handed up by a federal grand jury last month alleged
that Bucci and Nigel Potter, the former chief executive of the British
company that owns Lincoln Park, conspired to pay the law firm of
McKinnon & Harwood up to $4.5 million, over several years, "to
improperly influence and affect the official action of John B. Harwood
and other public officials."
The conspiracy was allegedly aimed at winning approval, during 2001, for
"1,000 to 1,500" more video-lottery terminals, for allowing the track to
move up the ladder to "coin-drop slots," and for keeping a proposed
Narragansett Indian casino off the state ballot.
According to the indictment, the money was to be "euphemistically
referred to" as a "reward" or "bonus" for McKinnon & Harwood's legal
services.
Neither McKinnon nor Harwood was charged. The indictment does not say
whether the money was paid, and both McKinnon and Harwood, who is no
longer House speaker but still a representative from Pawtucket, have
denied knowledge of the alleged scheme.
In a statement issued the day after the indictment, British owner
Wembley plc said: "These allegations arise from the consideration of a
possible bonus or retainer to Lincoln Park's long-standing external
legal attorney in Rhode Island," but "no payment was approved and no
payment was ever made."
In the weeks since, the company has refused to disclose when McKinnon &
Harwood was first hired, what the small Pawtucket law firm has done for
Lincoln Park and how much it has been paid.
In an Oct. 9 statement to The Journal, a company spokesman said Wembley
would not comment "on any issue that may be a matter of evidence or
testimony in the criminal trial at which it will be a defendant." The
next pretrial hearing has been scheduled for Nov. 5.
But Bucci told state Lottery Commission director Gerald S. Aubin more
than two years ago that the track had, at that point, paid McKinnon &
Harwood "$800,000 in compensation, of which 30 percent represents legal
fees paid to Mr. McKinnon for his representation of Lincoln Park in two
major lawsuits."
According to the notes that Aubin kept of that May 2001 conversation,
Bucci did not identify the two suits but said he "felt Mr. McKinnon was
not being sufficiently compensated."
PUBLIC COURT records, transcripts of Department of Business Regulation
hearings and town records provide some idea of the work McKinnon and a
junior associate did for Lincoln Park.
McKinnon represented the track when it made its annual requests to the
Department of Business Regulation for racing dates in the early 1990s.
By his own account, he negotiated labor contracts.
He also defended the track against breach-of-contract suits by unhappy
kennel owners, who had been dropped from the roster.
He waged a losing battle, in federal court, to get an insurance company
to reimburse the track for fire damage to a building under construction,
after a 60-day coverage limit had elapsed. (A federal appeals court
ruled against the track just last month.)
He argued on Lincoln Park's behalf, when former Gov. Lincoln C. Almond
went to court to try to invalidate the Lottery Commission's approval of
850 more video slots on grounds that the 6-to-3 dominance of legislators
meant the commission itself was illegally constituted. Almond lost, in
what amounted to a major win for the track and a historic reaffirmation,
by the state Supreme Court, of the Rhode Island legislature's sweeping
powers.
The law firm also defended the track against a $10-million
wrongful-death claim and a campaign by the state Department of Health to
force the racetrack to clean its air or ban smoking.
And he went to court to challenge a 1994 zoning change.
IN NO CASE was his role more visible than in that Lincoln zoning case.
First, Lincoln Park tried to get Rhode Island voters to allow it to
become what Bucci described as a "modest casino" offering coin-drop
slots, blackjack and poker.
In November 1994, the voters turned Lincoln Park down 232,493 to 90,658.
A week later, the Town Council took steps to nip any such future efforts
in the bud. The council placed an 800-foot, no-build buffer zone around
the track, and banned all gambling except that which was already there:
"greyhound racing, pari-mutuel wagering and/or video reel lottery
terminals."
The council also placed other limits on expansion, including a
building-height limit of 45 feet.
In the lawsuit he filed in December 1994, McKinnon argued that the
town's actions had placed "unreasonable restrictions" on the use of the
track property and lowered its value without any commensurate reduction
in taxes.
After a two-year flurry of interrogatories and a lost bid by the town to
have the case dismissed, the suit languished.
In February 1999, the Lincoln Town Council hired a new town solicitor:
lawyer Thomas Hanley.
As legal counsel to former House Speaker Joseph DeAngelis, Hanley had a
hand in packaging the 11th-hour bill that brought video gambling to
Rhode Island in the early 1990s.
A one-time director of job development for the state, campaign
managerand casino lobbyist, Hanley also helped Spielo, a Canadian
manufacturer of electronic lottery games, gain a foothold in Rhode
Island's video-lottery business.
Hanley's advice to the Lincoln Town Council: settle with the track.
"It appeared on its face, and everybody looked at it, to be blatantly
unconstitutional," said Hanley, of the 1994 zoning restrictions. "I
said, 'You go to court, and it's a toss-up, and they've got some strong
arguments."
Recalling that time recently, Hanley said town officials were willing to
reduce the buffer zone, but the track owners "always wanted to attach
additional gaming to the settlement."
Specifically, the track wanted to tear down a vacant building and put in
its place a home for the next level up in gambling entertainment -- with
"coin-drop slots," instead of the current "video-lottery terminals" that
reward winners with redeemable paper chits.
Voter approval probably would be required. But first things first: no
such expansion would be possible until the 1994 gambling and site
restrictions were lifted.
Hanley said he no longer remembers all of the specifics, but "the town
always felt it should be able to settle the case on the merits of the
buffer zone, without additional gaming issues."
On Nov. 20, 2000, after a series of meetings that drew hundreds of
protesters to Town Hall, a council committee rejected an ordinance that
would have substantially reduced the 800-foot buffer zone to 150 feet.
Had it passed, the ordinance would have also allowed Lincoln Park's
owners to build a hotel and other amenities, such as stores, restaurants
and meeting halls, as long as they obtained zoning board approval.
FLASH FORWARD to Sept. 18, 2001.
The videotape shows McKinnon standing at the front of the brick-walled
council chamber, explaining how "very easy" it would still be to have
Lincoln Park's 1994 zoning case tried in court.
"All I have to do is go down, speak to the magistrate, ask for this to
be assigned for trial and I could have it tried in six months. I could
have had it tried four years ago," McKinnon said. And the town "would be
indebted to Lincoln [Park] well into seven figures."
"I do that for a living," but "the last thing Lincoln wants is to win
that lawsuit," he said.
While the five Lincoln Town Council members looked on from behind him,
McKinnon took questions from the audience about the proposed changes to
town zoning law that were up for a vote that night.
The buffer would be reduced to 350 feet from the closest residential
zone; the height-limit raised -- and certain types of gambling allowed
with a special-use permit, including dog-racing, video gambling and
"mechanical lottery terminals," to the extent "permitted by state law."
("A slot machine, by definition, is mechanical, whereas the VLTs we
currently have are like touch-tone screens," track CEO Dan Bucci
explained that night.)
While everyone else sat, McKinnon stood like a lawyer making his case to
a jury: one hand in the pocket of his dark suit, the other gesturing for
emphasis.
What were Lincoln Park's plans, he was asked.
"To cut the wheat from the chaff," McKinnon told the audience, "if you
were all to walk over to that facility right now, and to look at it, the
only visible difference which might occur at some distant point in the
future is that the building which houses the primary company, could be
expanded by 45 percent. . . .
"Other than that, everything that is in this [zoning] ordinance is
already allowed," he said.
"It does not expand gambling," McKinnon assured the audience. "A whole
series of gambling, which otherwise might someday be allowed by state
law, we have forever waived," he said.
To the man who asked if the council was, in actuality, allowing the
track to "bring to town anything that would be allowed by state law,
including blackjack," McKinnon said: "Just exactly the opposite. The
council has negotiated such a restrictive deal with us, that not only
does the zoning ordinance preclude it, but the solicitor is going to be
filing a restriction against the deed which precludes subsequent owners
from doing it."
In his turn, Town Solicitor Mark Krieger said: "We've also specifically
excluded any type of casino table games, such as dice, poker . . .
baccarat, anything of that sort."
To a Grandview Avenue man who had questions, McKinnon said: "We have no
applications before the Lottery Commission now for any more machines and
I doubt very much they'll ever say, 'here's 1,300 machines, good luck.' "
(Lincoln Park's application to the state Lottery Commission for 1,300
more machines was filed three weeks later. And in January 2003, the
commission approved 1,300 more machines.)
Coin-drop slots?
"Yes, under this proposal, with certain restrictions, coin-operated
machines is a potentiality," McKinnon said.
But "understand, if you walked into that building and I had 500
coin-operated machines and 500 VLTs, and I asked you to tell the
difference without playing them, you couldn't tell the difference."
"We have forebeared on being able to develop the property with any
freestanding restaurants . . . waived forever our ability to build
hotels. . . . This is a transient point where people come in, spend two
or three hours and leave . . . [not] a point of destination, which is
what a [Foxwoods] would be called."
"In addition to all of these things . . . we have also dedicated a
substantial amount of land to your community for Little League
ballparks, for soccer fields so that generations to come will enjoy the
facility."
THE VIDEOTAPE shows Raymond Depault, the hardware store owner who was
Town Council president at the time, reading the three pages of the
agreement, word for word, out loud.
He began, "This is the agreement that has been signed by the track and
by the town."
He read Lincoln Park's promises to drop its lawsuits and build soccer
and baseball fields for the town "at its sole cost and expense."
Then he read the track's pledge to "execute a separate agreement which
shall be recorded in the land evidence records of the Town of Lincoln
which expressly forever waives its right to operate any and all
'casino-type' tables games including, but not limited to blackjack,
poker and any and all card games, roulette baccarat and/or dice tables
even if federal and/or state statutes are enacted which would allow such
forms of gambling."
When he came to the next sentence, he stopped reading and called out to
Krieger, the town solicitor: "Mark, is this the one that was just given
to us?"
The tape shows Depault huddling -- at the council table -- with Krieger,
Councilman Dennis Auclair and McKinnon before skipping ahead to the next
sentence in the agreement.
The sentence he left unread said: "Provided, however, that the park may
petition the town for the right to operate any and all 'casino type'
table games, including but not limited to Blackjack, poker and any and
all card games, roulette, baccarat and/or dice tables, if federal and/or
state statutes are enacted which would allow such forms of gambling."
This provision went unmentioned in the minutes of the meeting, even
though it was questioned, at one point, by Dean L. Lees Jr., the one
dissenter on the council.
Current Town Administrator Sue Sheppard says she can only guess why it
went unmentioned. As town clerk at the time, she said: "I was there for
the zone change, and the agreement evidently didn't even ring a bell
that it was going to be important at a later date because . . . that was
all I wrote. 'Ray reads agreement.' "
Asked recently why he did not read that one sentence to the audience,
Depault said, he had not seen those words before and didn't know where
they came from.
"You have a tape of me hesitating because I'm there, I'm saying 'What
happened here?' And then, I look at Mark Krieger and he comes over, and
then Dennis Auclair who says, 'Well, that's the way it is.' "
In that moment caught on tape, Depault said, he "asked Mr. Krieger what
had happened with those words and basically his thought was, 'Ray,
that's basically what we had agreed on.' I disagreed with that, but it
was too late to do anything about it."
The council had met privately a week earlier with Bucci, McKinnon and
one of his legal associates, Michael Sendley, to discuss the terms of an
agreement. Also present: Krieger and thenTown Administrator Jonathan
Oster, who is now facing trial on unrelated corruption charges.
The minutes of that earlier meeting say: "If this ordinance amendment
passes, all lawsuits will be dismissed . . . all legal fees, well into
six figures, will be absorbed by Lincoln Park." Krieger is quoted as
saying: "The new ordinance amendment states that casino-type gambling is
not permitted."
"Somewhere along the line those few words got changed," Depault said
recently.
"Somebody had to submit that to the town as the final document. I am
assuming it had to come from Ray Depault or Jon Oster," Councilman
Auclair speculated recently. Oster declined comment.
But Krieger, the town attorney, said there is no mystery who asked the
council to add this proviso to the agreement: "It was Dan McKinnon."
"That was his request that the council consider that additional
language," Krieger said. "If other facilities were to be allowed that
use by state law, then the park wanted to be on equal footing with any
other entity that may receive that type of permission."
And, "It wasn't like they agreed the night before and it was changed
without their knowledge," said Krieger of the Town Council. "I can
categorically say, that was not the case."
But on videotape Councilman Lees, the dissenter who is now council
president, said:
"Look at what has changed from the proposal that was given to this Town
Council last night."
Depault called for the vote.
But, "Mr. chairman, I have a question," Lees persisted.
Depault: "You had your chance to speak."
Lees: "But I want to make sure the the council understands what it is
doing."
Depault: "The council understands what it is doing. You're the only one
who doesn't understand it." (Laughter) "Dean, we have been speaking on
this for months now. That's enough. We're going to take roll call vote."
The vote was 4 to 1.
The side agreement, which has not yet been executed pending the outcome
of the court challenge to the zoning ordinance, was signed that night by
Lincoln Park CEO Bucci and then-Town Administrator Oster. Solicitor
Krieger was a witness.
IN A TELEPHONE interview on Thursday, McKinnon said he "did not
anticipate having to speak" when he went to the Sept. 18, 2001, council
meeting. 'It was when questions were posed by the citizens that the
council asked me to speak.
"So that's when I stood up and answered some of the questions.
Everything I did there was off the top of my head."
Looking back, McKinnon said, the decision to draft a side agreement
stemmed from Councilwoman Patricia Melucci's request to have "certain
things in writing." He said the actual drafting was done by his
associate Michael Sendley and Krieger.
Of Krieger's recollection that he was the one who asked the council to
leave the door ajar for future talks about "casino-type" gambling,
McKinnon said, "I recall speaking to Krieger about that when it dealt
with coin drops. I have no recollection of speaking to him about it when
it comes to these particular" table games.
Asked how he would explain the language allowing the town to consider
activities that had been "forever" waived, McKinnon said: "It's because
both parties were interested in preserving the right to petition
government and for government to be able to make a decision.
"Three years from now, 35 years from now a town council may have totally
different thoughts. Citizens may have totally different thoughts. They
may have totally different concerns. All this allowed Lincoln Park to do
was to petition government and government would have the ability to say
yes or no."
Asked what then the word "forever" meant, he said: "My position is the
document speaks for itself. . . . It's a public document. It was signed.
It's recorded. Nobody's attempting to pull the wool over anybody's eyes.
It's open . . . in writing and whatever it says, it says."
with reports from Liz Anderson
DIGITAL EXTRA: Read the full text of the agreement between the town of
Lincoln and Lincoln Park, at:
http://projo.com/news/pdf/lagreement.pdf
