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WILKES-BARRE, PA-Faced with delays in obtaining a gaming licenseand a higher-than-expected gaming tax burden, the Uncasville,CT-based Mohegan Tribal Gaming Authority considered walking awayfrom its plans for a casino at the Pocono Downs harness racetrack.Now, however, in return for a $30-million commitment from PennNational Gaming, which sold the asset to the authority in October2004, and anticipation of about $15 million in state funds, the newowner is set to break ground on the first phase of its $200-millionMohegan Sun at Pocono Downs casino and racetrack.

Entities cannot own in full more than one casino in the state.In order to retain its own ability to create Hollywood Casino atPenn National in Graniteville, Wyomissing-based Penn National soldthe Pocono Downs track and five off-track wagering operations inthe state to MTGA for $280 million. The purchase agreement,however, contained several post-closing termination rights, whichcould be exercised "in the event of materially adverse legislativeor regulatory events."