Rendell gambles on high payouts

HARRISBURG (AP) -- When the Legislature directs the state to sell off a parcel of surplus land, future buyers will have to pay a premium if the land is to be used for gambling.
Gov. Ed Rendell introduced the new policy in May as federal investigators reviewed how one parcel of state land was sold to a group of buyers that included state Sen. Michael J. Stack. The investors bought the land for $100,000, then sold an option on it for $37 million to a Las Vegas casino company.
The governor's new policy requires a buyer who is identified in land-sale legislation to disclose whether the land is intended for gambling use. If so, the state would raise the sales price to account for potential gambling profits. If not, the deed would be restricted against gambling use, said Frank Kane, spokesman for the state Department of General Services, which handles state land sales.
Kane said the policy was not prompted by the land sale to Stack's group, but by a desire to ensure that the state gets its fair share from its land sales.
"The whole point of the policy is to ... make sure the taxpayers' interest is protected," Kane said.
The new policy applies to surplus land sales in which lawmakers pass legislation identifying a buyer and price. It does not apply to the other method of land sales in which the state seeks approval from the Legislature to auction off a surplus parcel.
The policy has not yet affected any state land sale, although the Rendell administration has requested that lawmakers amend pieces of land-transfer legislation written before the policy was introduced to exclude gambling.
Sen. Jane Earll's legislation to transfer 13 acres for a yet-to-be-built Erie Convention Center for $1 was amended in such a fashion, and she said the policy decision seemed like a wise move.
"Clearly it's in response to the Stack situation and they figure that if there's money to be made, the state should be making it, not just speculators," said Earll, R-Erie.