The Picayune Rancheria of Chukchansi Indians is being sued by owners of the office building that houses the tribe’s headquarters for not paying rent for more than two years.
A lawsuit, filed Oct. 28, said the tribe hasn’t paid $749,699 in late rent and interest dating back to April 2014 under its lease with River Palm Partners, owners of the River Bluff office park at 8080 N. Palm Ave. that overlooks the San Joaquin River bluffs.
Chukchansi tribal members were in a factional dispute when the first lease was signed in March 2013. An updated lease was signed in April 2014 to work out a new payment schedule.
The suit names the tribe, but no individuals in particular. The tribe’s leadership roster has continued to change since 2013.
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Both leases were signed by Reggie Lewis, who was chairman of one of the tribal council factions at the time.
The updated lease offered the tribe a break for three months by lowering the rental rate from $17,677 to $1,000 per month from April to June 2014.
But beginning in July 2014, the tribe was under contract to pay $278,311 that included three months rent at the regular rate (minus the $1,000 per month paid) and prepaid rent for the coming year exceeding $213,000 plus a $15,000 accommodation fee for the discounted rent.
The updated lease also set up a rent payment schedule for three years from July 2015 to March 2018.
This issue, like many others, is part of the legacy of the previous tribal council that was responsible for the casino closure.
Claudia Gonzales, Chukchansi tribal chairwoman
A key issue in the updated lease is a “limited waiver of a claim of sovereign immunity” that the tribe agreed to.
“Otherwise we would not be able to sue them,” said Douglas Thornton, lawyer for River Palm Partners.
In 2015, Lewis was ousted in a tribal council election. He was replaced by Claudia Gonzales and a new tribal council 13 months ago.
The election occurred as the tribe was working with the federal government to get Chukchansi Gold Resort & Casino near Coarsegold reopened after tribal faction battles. The casino closed in October 2014 after the federal government threatened to shutter it because of missing federal audits, which prompted a raid of a gaming office and a factional battle that ended in 15 arrests.
Lewis’ faction had taken control of the casino and a group led by Tex McDonald was housed in the tribal business complex on Road 417, across from the casino. Members of the McDonald faction came into the casino supported by members of its police force.
The casino reopened at the end of December 2015, reviving the tribe’s revenue flow.
Before the closure, casino analysts projected annual revenue of about $100 million for the tribe. About half of that money is used to pay employees and refinancing costs for the hotel and casino. The remainder is used to pay tribal members a monthly stipend and tribal programs for utilities, clothing and education, as well as local governments, donations and leases for office space.
Gonzales said earlier this week that tribal officials hadn’t seen the lawsuit, but she said the tribal council has been working with the landlords to resolve the lease issues. She blamed the problems on a previous council.
“This issue, like many others, is part of the legacy of the previous tribal council that was responsible for the casino closure,” she said. “Since I was elected chairwoman with a new tribal council, we have been working hard to clean up their messes and restore transparency, economic vitality and respect for our tribe.”
They blame everybody else for the problems that they have.
Reggie Lewis, former Chukchansi tribal council chairman
Lewis said the tribe had money problems after a split in his faction in 2013, and those issues continued into 2014 with McDonald’s group in charge.
He said he signed the lease in 2013 and the updated agreement in 2014 with his tribal council’s approval.
“We had attorneys working with the landlord,” he said.
Lewis said he resents being blamed and said the new council has had nearly a year to resolve the lease issue with revenues from the casino. Those revenues weren’t available earlier, he said, and thus bills went unpaid.
“You inherited the problem and you were supposed to fix it,” he said. “ … They blame everybody else for the problems that they have.
“There’s a lot of stuff this (new) council has done that I don’t agree with, but I’m not going around blaming them.”