UPPER LAKE — With the recent signing of a tribal-state gaming compact and the local Assembly member authoring a bill to ratify the agreement, the Habematolel Tribe of Upper Lake is optimistic that its proposed Running Creek Casino could be up and running by the end of 2011.
“We absolutely feel like this project is going to get approved,” tribal council chairperson Sherry Treppa said.
The tribe”s current plan is to construct a 33,000-square-foot “sprung structure” that will house 349 slot machines, six table games, three meeting rooms, a sit-down restaurant, fast food court and a cocktail lounge. The project costs are estimated at $28 million.
The casino and adjacent parking lots would sit on an 11.24-acre trust parcel on Highway 20 in Upper Lake adjacent to the community park.
Once opened, the casino is expected to use at least 145 employees. “The tribe”s goal is to keep as much of the business here (in Lake County) as is possible,” Treppa said.
The tribal-state compact includes a number of requirements and stipulations that would apply to the casino if the agreement were approved.
The next step in the approval process would be state legislation ratifying the compact. Assemblyman Wesley Chesbro (D-North Coast) announced Thursday that he is currently authoring an assembly bill ratifying the agreement and will be amending his bill, AB 1020, next week to make it urgency legislation.
“This compact is extremely important since it will create more than 145 badly needed new jobs in a county with one of the highest unemployment rates in the state,” Chesbro said in a statement.
The local Assemblyman also commended the tribe for doing “an outstanding job” of working with a variety of local agencies.
The tribe entered into a memorandum of understanding with Lake County in 2006, set aside non-trust acreage to accommodate county projects improving Middle Creek, and entered into an emergency services agreement with the Northshore Fire Protection District, according to Treppa.
If ratified by the state legislatures, the compact would then need to be approved by the U.S. Department of the Interior (DOI).
The tribe is confident that the DOI will approve the current compact terms but knows from recent history that federal approval is not a sure thing, according to Treppa.
The tribe negotiated with the administration of then-Governor Arnold Schwarzenegger for nearly 10 months before signing a compact in September 2009, Treppa said.
Both state houses ratified that compact by December 2009, but an expected 45-day federal approval period turned into seven months of vetting with the DOI, which ultimately disapproved of the compact terms in August 2010.
“The tribe felt like we were kicked when we were down,” Treppa said of the DOI decision.
The tribe had decided to break ground on the Highway 20 site in early 2010, after getting local and state approval. Work already completed at the site included clearing vegetation, setting up temporary office buildings and preparing a pad on which the casino would sit.
The tribe also completed $500,000 worth of road and safety corridor upgrades in accordance with a Caltrans traffic mitigation plan.
The DOI delay was one of several factors causing work to come to a halt at the location in March 2010, and the site has remained enclosed by a chain-linked fence since.
The disapproval left the tribe in an even more precarious financial position. “We were in debt $12 million when the denial came through,” Treppa said, citing accrued interest, predevelopment and construction costs, and legal and lobbyist fees.
The tribe anxiously began negotiating with the Jerry Brown administration soon after Brown took office, according to Treppa, and the current Governor signed the new compact in early March.
The DOI disapproval may have ended up being a blessing in disguise because the 2011 compact better addresses “the needs of the tribe in addition to the needs of the community,” Treppa said.
The DOI”s primary issue focused on the revenue sharing outlined in the 2009 compact, according to Treppa.
The 2011 compact terms call for 0-percent net-win revenue sharing with the state if the casino operates 350 or fewer gaming devices, 7-percent revenue sharing for 351 to 600 devices and 15 percent if the casino expands to more than 600 devices.
The revenue sharing funds will go into a Special Distribution Fund, which in part provides funding for problem-gambling prevention and grants for local communities for gaming-impacts mitigation. The revenue sharing funds would have gone into the state”s General Fund under the 2009 compact.
Though the current plan is to open a “sprung structure” with 349 slot machines, expansion could not be too far away, according to Treppa.
If Running Creek Casino opens during 2011 and performs consistently well, the tribe could refinance in three to four years in the hopes of constructing a permanent casino and hotel on the same parcel in six or seven years, she said.
The revenues generated by the casino would also provide funding for tribal needs, such as higher education, housing and medical insurance, Treppa said.
Contact Jeremy Walsh at jwalsh@record-bee.com or call him at 263-5636, ext. 37.
