NSW Premier Barry O’Farrell announced the NSW Government has entered a binding agreement with Crown Resorts Limited to develop a VIP restricted gaming facility at Barangaroo, following the completion of negotiations under Stage 3 of the Unsolicited Proposals policy.
The terms of Crown's final offer are consistent with the Stage 2 approval which included assessment by an independent steering committee chaired by former head of the Australian Future Fund David Murray AO.
The Stage 3 negotiations were oversighted by the Hon Ken Handley AO QC who provided probity supervision and advice.
The binding agreement includes the conditions outlined previously, such as no low limit bets on table games, no poker machines, VIP gaming only, a non-rebate gaming tax rate of 29 per cent, and guarantees of total licence fee and gaming tax payments of at least $1 billion over the first 15 years of full operation.
The NSW Government will introduce legislation into Parliament this week to enable approval of the new restricted gaming facility at Barangaroo.
Statutory approvals are still needed from the Independent Liquor and Gaming Authority and planning consent for construction of the hotel resort, which will include the usual opportunity for public consultation.
The NSW Government has accepted this unsolicited proposal because the independent assessment committee found a competitive casino market would deliver increased tourism and broader economic benefits for NSW.
The independent assessment committee found the Crown project would result in an estimated 1,250 additional jobs after construction, increased international tourism, and an increase in Gross State Product of $442 million per annum by 2025.
It found Sydney was falling short of its potential share of the growing international gaming and tourism market and has underperformed compared with Melbourne.
HOW UNSOLICITED PROPOSALS ARE HANDLED BY THE NSW GOVERNMENT:
Stage 1 - Initial submission and strategic assessment: a comprehensive initial assessment of the proposal to identify the potential benefit to government of further consideration and development with the proponent. The outcome is advice to the proponent of progression to Stage 2, or that the government does not wish to proceed.
Stage 2 - Detailed proposal: requires the proponent and government to work cooperatively in the development and assessment of a detailed proposal. The outcome is advice to the proponent of progression to Stage 3, or that the government does not wish to proceed.
Stage 3 - Negotiation of final binding offer: involves the finalisation of all outstanding issues with a view to entering into a binding agreement, if the government decides to accept the final offer.