Tribe Has a New Partner

By Amy Yannello - Roseville Press-Tribune

Leaders of the United Auburn Indian Community announced Tuesday their decision to work with Las Vegas-based Station Casinos, Inc. to develop and operate the tribe’s proposed casino at Athens Avenue and  Industrial Boulevard in unincorporated Placer County.

Company officials said they expect an initial infusion of $100 million into the development of the property.

The partnership and actual movement on the project hinges on both the federal government’s acceptance to take the land into federal trust and the will of voters in march who will decide whether to approve  an amendment to the state Constitution that would expand, as well as regulate, Indian gambling in the state.

Such a move would ratify the tribal/state compact reached in September between Gov. Gray Davis and 60 of the state’s 106 Native American tribes, 43 of whom currently have gaming operations on reservation  land.

Station, which currently owns and operates five gaming and entertainment establishments in Nevada and another two in Missouri, is a publicly traded company listed on the New York Stock Exchange.

"The plain fact is that we are not a wealthy tribe," said Tribal Chairwoman Jessica Tavares in a prepared statement. "Nor (are we) experienced in the management of gaming facilities and must  obtain outside assistance in order to develop the casino—a project that will create economic self-sufficiency for our members."

The proposed 200,000 square-foot casino is expected to house more than 1,500 slot machines and house more than 50 gaming tables, as well as food, beverage and entertainment venues.

Station Chairman and Chief Executive Officer Frank Fertitta III said he expects to open the facility early in 2002 and wants to "strengthen (the) alliance" the tribe has built with its commitment  to county officials to offset any off-site impacts through a variety of physical and financial mitigation measures.

This is Station’s first foray into California gaming and its first attempt to involve itself in a Native American gambling facility.

"The tribe’s agreement with Placer County fits in with our corporate culture," said Glenn Christenson, chief financial officer of Station. "It’s part of our strategy to cater to locals, so  it makes good business sense to be a good corporate citizen. I think when people check into our track record, they’ll see that we’re solid."

Family-owned and operated since 1976, Station Casinos will partner with the tribe for seven years—the maximum allowed by federal law. Although terms have not been finalized, the company will be entitled to  share up to 30 percent of the tribe’s revenues each year it helps run the casino.

According to an April 19 article in Forbes Magazine, Station "picks most of its traffic from Vegas residents, a mix of retirees and employees of other gambling joints."

"Indeed, ‘locals’ are a distinct market segment, with a $1.7 billion annual win for the casinos. Station has 40 percent of it."

According to Forbes reporter Seth Lubove, nearly half of the growth in gambling revenues last year in Las Vegas—and a third in all Nevada—wasn’t recorded on the Strip at all, but in the four off-Strip  casinos run by Station Casinos. The company posted revenues for 1998 totaling nearly $850 million, boasting $201 million in profits. Year-end figures for 1999 are expected to reach $1 billion, earning a  profit of $230 million.

"We admired the company’s financial depth and stability, many years of successful experience in the gaming industry and impeccable credentials. These items, along with the company’s corporate  culture of participating in the communities in which it operates, clearly illustrates that Station casinos will greatly assist us in developing and operating a first class facility."

Added Christenson, "Clearly, the demand is there (in Placer County). And we feel confident that when people see what we’ve done elsewhere, they’ll be impressed."

Station Casinos was one of the founding members of the National Problem Gambling Association, according to Christenson, who allocated $1 million toward the effort. The company also provides annual  contributions to a host of nonprofit organizations, such as the United Way, Boys and Girls Clubs of America, Big Brothers/Big Sisters and Habitat for Humanity.

Scott Smith and other principal opponents working as Citizens for Safer Communities were unable for comment Tuesday.

Copyright © 1999, Roseville Press-Tribune