Paterakis faces mammoth hurdle Development: Paterakis is accustomed to success, but he faces the political challenge of a lifetime as he tries to get a gambling casino for his Inner Harbor East project.

January 07, 1996|By C. Fraser Smith and Will Englund | C. Fraser Smith and Will Englund,SUN STAFF

With $18 million of his own money invested, John Paterakis Sr. allowed the trace of a smile to cross his face as ground was broken last month for an ambitious waterfront project that will alter Baltimore's skyline and, perhaps, its character.

The baker-turned-developer joined Mayor Kurt L. Schmoke in ceremonies inaugurating the $350 million Inner Harbor East project and listened to a state official hail his entrepreneurial spirit.

For a man whose international bakery businesses spin off revenues of $500 million a year, the praise meant less than the concrete pilings already in place. After 10 years of frustration, an office tower is going up on a 20-acre lot near Little Italy. An apartment building is planned. A marina and a restaurant already are open.

If Mr. Paterakis gets his way, there will be much more -- a gambling casino and a family entertainment zone with roller coasters and high-tech games, ventures worth millions to him. ,, But to accomplish his "dream of dreams," he faces the political chore of a lifetime.

Gov. Parris N. Glendening promises to block any proposal to legalize casinos. So, once again, the 66-year-old Mr. Paterakis must find a way to prevail -- by helping to elect a new governor, for example.

Short of that, he will try to base the case for his venture on its value as economic development and as a civic rescue mission, insisting that a casino would bring jobs, money and new life to a failing city.

The magnitude of the challenge helps explain why Mr. Paterakis appeared at the groundbreaking. It was a rare public appearance for a man whose political and business lives merge in private and so smoothly that each seems an extension of the other.

"You try to be good to the political people," he says. "They make the laws."

Mr. Paterakis is accustomed to success. A millionaire many times over, his most famous client is McDonald's: His bakeries produce every Big Mac, McChicken and every other McDonald's bun from Maine to Florida, 250 million dozen in all every year.

Everything flows from his original business, H&S Bakery, an operation with $100 million a year in revenue that he calls the "mana" (Greek for mother) of all the rest. Its yellow and green trucks, its sprawling production facilities and its headquarters on Fleet Street are within walking distance of the Inner Harbor project.

Over the years, being good to the politicians has been critical. Mr. Paterakis has needed building permits for bridges over city streets and for plant expansions. He has needed police protection and assurances that his prodigious fleet of trucks can keep rolling over city streets. And he has needed financial help from the city and state governments to develop everything from truck stops to downtown office buildings.

His fortune, his energy and his 40 years of friendships with elected public officials in Maryland grant him considerable power.

He is the consummate advice-giving, bankrolling, inside political player.

He serves on the boards of banks, Loyola College and the Greater Baltimore Committee, among others, and functions as the unpaid manager of the city's markets. He works a network of community contacts as if he were a practicing politician, attending bar mitzvahs, baptisms, funerals and fund-raisers.

"He'll do favors for folks. He'll call a city agency to get someone a job," said former Baltimore County Executive Theodore G. Venetoulis. "He'll call someone to get a zoning thing through. There are hundreds of these things. So much is asked of him."

Now, Mr. Paterakis is asking for something in return, something he thinks should be easy to grant. A cardplayer and enthusiastic gambler, he professes amazement that political leaders could oppose casinos.

With the state lottery Maryland's third-largest revenue source -- and, in his view, the biggest threat to the financial well-being of poor people -- he thinks the state can hardly object to gaming on moral grounds.

He was offended when Attorney General J. Joseph Curran Jr. -- for whom Mr. Paterakis says he has raised considerable campaign money -- called casinos a disaster for Maryland, a corrupting influence.

"I said, 'You're my friend. Why would you make a statement that you're against gambling. If you're against gaming and it's creating crime, why don't you shut down what you already have? Why don't you do something about the gambling we got?' "

Thus does the onslaught of arguments proceed. From Mr. Curran to Mr. Schmoke to Mr. Glendening and a range of !B legislators, Mr. Paterakis is calling in a career's worth of IOUs in quest of his dream.

'You need help'

He is not a man to sit and wait for the action that stimulates him.

In 1975, he and Daniel Amoroso, a bread maker in Philadelphia and an old friend, were asked to take over a failing bakery there. They did, and today the company is a success in the unsentimental world of Philadelphia food distribution with sales of about $10 million annually, relatively minor for both men.

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