The City of Boston has conceded it is not a host community for Steve Wynn's proposed Everett casino, ending a dispute with the Las Vegas developer and eliminating the possibility that Boston could block the $1.2 billion project.
Mayor Thomas M. Menino's administration has agreed to begin talks with Wynn as a "surrounding community" under the state casino law, according to a joint statement Friday from the city and Wynn. Surrounding communities can negotiate for compensation to offset the effects of a casino, such as increased traffic, but have fewer rights than host communities and cannot kill projects by voting them down or by stonewalling negotiations.
There were two other major shifts Friday in the state's rapidly changing casino landscape, with Massachusetts losing one slot parlor bidder while gaining another.
Chicago billionaire Neil Bluhm dropped his pursuit of a slot license in the Central Massachusetts town of Millbury, citing a lack of public support.
"We spent a lot of time in Millbury and recently it became clear to us that a majority of residents do not support a casino," Bluhm said in a statement. "It is not our style to campaign aggressively and win a referendum narrowly. We prefer to join together with our host community and build something collaboratively."
The company was vague about any future plans in Massachusetts.
As Bluhm left the slot parlor race, Penn National Gaming won the approval of state regulators to get back in.
By a 4-to-0 vote, the gambling commission allowed Penn to compete for a slot parlor license at Plainridge Racecourse, the Plainville harness racing track.
Plainville residents will vote on the proposal at a town-wide referendum Tuesday.
The track was a frontrunner to win a license before its ownership group was disqualified from the competition in early August.
Penn signed an option to buy the track after Tewksbury town meeting voters killed a Penn slot proposal in that town on Aug. 20.
Opponents of a Plainville slot parlor tried Friday to stop Penn by contending that the transfer violated a requirement in state law for at least a 60-day campaign period before any casino vote. Opponents said the 60-day clock should start over with the new owner, which would push the mandatory referendum past the commission's Oct. 4 deadline.
Commission Chairman Stephen Crosby said opponents had raised a fair point, but that eliminating an applicant based on a highly technical reading of the law would undermine the board's mission of fostering competition for the licenses it controls.
The other applicants for the slots license are in Raynham and Leominster.
In Boston, the resolution of the spat between the city and Wynn is a significant win for the developer. Had Boston been designated a host community, the Everett project had little chance of surviving negotiations with Boston and a local vote in Charlestown. Menino, who favors a rival casino project at Suffolk Downs, could have refused to negotiate or demanded a bounty in compensation that Wynn would have been unlikely to pay.
The parties still must negotiate compensation due to Boston's standing as a surrounding community, and the city is sure to press hard for money to address the effects of a casino on its border. But if they cannot reach a deal, the dispute will be settled in arbitration.
The two sides say their appearance Wednesday before the gambling commission helped break the stalemate.
Boston had suggested it could be a host community based on the odd shape of the city line, which crosses the Mystic River into the former Monsanto chemical site where Wynn wants to build. Maps displayed by Wynn at Wednesday's public meeting indicated that all of the company's proposed development was on the Everett side of the city line.
Wynn is competing for the sole Greater Boston resort casino license with Suffolk Downs and with a Foxwoods project in Milford.
Mark Arsenault can be reached at email@example.com. Follow him on Twitter @bostonglobemark