Vegas Gaming Firm, Placer Tribe Hook Up

By Art Campos - Sacramento Bee

A local Indian tribe has signed a seven-year contract with a Las Vegas-based company to build and operate a proposed gaming casino on unincorporated land in Placer County.

Experts said the agreement – the second signed by a Nevada gaming operator with a California Indian tribe in the last month – is a harbinger for the Indian gambling industry in the Golden State.

"Yes, you can expect a trend," said Bill Eadington, director of the Institute for the Study of Gaming at the University of Nevada, Reno. "Under the best guesses, California has the potential to be as big as Vegas in the gambling industry."

The contract announced Tuesday by the United Auburn Indian Community calls for Station Casinos Inc. to build the $100 million, 200,000 square-foot casino on a 58-acre site near Roseville, Rocklin, and Lincoln. It would open in 2002 and have more than 1,500 machines and 50 table games.

Two weeks ago, the Pala Band of Mission Indians contracted with Anchor Gaming of Las Vegas to build a $90 million casino in San Diego County. It was the first such investment by the Nevada gambling industry into the California tribal casino market.

The deals come on the heels of a historic agreement between Gov. Gray Davis and the state’s gambling tribes. The compact is expected to resolve questions about the legality of tribal gambling and allow Nevada gambling interests to invest in California.

"These Las Vegas companies have not only the expertise in the development and operation of casinos but also the financial resources to make them a first-class casino facility," said Doug Elmets, a spokesman for the United Auburn Indian Community, which consists of about 160 Maidu and Miwok Indians.

However, the Placer County site has been under considerable debate over the past five months.

While the tribe says it is determined to build the casino at Athens and Industrial avenues near Highway 65, some residents from the surrounding cities have rallied against the facility, saying it will be too close to homes, schools and businesses and attract drugs, crime and traffic.

The residents and all three of the city councils – Roseville, Rocklin, and Lincoln – have opposed the casino and hope to dissuade the U.S. Bureau of Indian Affairs from approving the proposed site.

Under contract between Station Casinos Inc. and the United Auburn Indians, Station will get 22.5 percent of the casino’s revenues. It will also get a fee for the use of the Station brand.

Station has agreed to help the tribe get financing but it won’t incur any debt on the project.

"The Auburn tribe is not a wealthy tribe," Elmets said. "They need capital and they’ve now found a partner that is going to help them gain economic self-stuffiness."

Frank J. Fertitta III, chairman and chief executive officer for Station Casinos Inc., said his company was "very excited" about the chance to help the Auburn tribe.

"We support the tribe’s efforts to cooperate with the local community and will work to strengthen this alliance as we proceed with the development process," Fertitta said.

Opponents of the casino location near Highway 65 were unhappy over Tuesday’s announcement.

"The tribe still doesn’t even own the land," said Lynda Fioravanti, a Roseville resident. "And we’re still going to try to get (the Bureau of Indian Affairs) to move this casino away from residences."

Roseville Harry Crabb questioned the hiring of a Nevada-based outfit to run the casino.

"Are we really benefiting people in need when in fact this casino is going to be run by the gaming folks out of Nevada?" he asked. "They’re not in it for anything but money. I don’t think they really care about the impacts on our local communities."

Eadington said Nevada casino operators shied away from entering contracts with California tribes in the past because Nevada regulators considered gambling to be illegal in California.

"Nevada casino operators were at risk of losing their licenses if they dealt with California," Eadington said.

But after Davis signed compacts with Indian tribes last month, it opened the door for Nevada gaming companies to deal with the California tribes, Eadington said.

"The Nevada companies have the expertise and California tribes have the right to offer gambling. It’s a natural marriage," Eadington said.

Eadington said Station Casinos Inc. is "one of the strongest companies" running local casinos in Nevada.

"They are highly competent," he said. "Their share on the stock market has gone from $4.09 to a current $26.125 in just the past year. They’re viewed as one of the up and coming casino companies."

The United Auburn Indian Community is federally entitled to build a casino somewhere in Placer County. The site in an industrial are at Athens and Industrial avenues was selected after a joint search effort with county officials.

In March, the state’s voters will get a chance to consider the agreement signed this month between Davis and about 60 tribes.

The agreement would allow the tribes to keep their slot machines – with a statewide cap on the number of machines – and would amend the state Constitution to legalize such gambling.

Voters approved a similar measure in 1998 that would have changed state statutes. But the state Supreme Court called Proposition 5 unconstitutional and struck it down.

Nevada casinos, fearing that Proposition 5 would hurt their businesses, opposed the measure. But they are expected to aggressively invest in California’s tribal casinos after the March vote, which is expected to be approved.

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