A $35 million deal with creditors is close to being reached to reopen the Chukchansi Gold Resort & Casino by the end of the year, perhaps as early as Labor Day, but the tribe is still awaiting state and federal approval to open.
Officials with the tribal council led by Reggie Lewis described it as one of the “significant milestones necessary to re-open their world-class” casino.
Chukchansi Gold, near Coarsegold, has been closed since rival factions squared off during an Oct. 9 raid on a casino office. The action that night resulted in 15 arrests and state and federal authorities stepped in Oct. 10 to make the closure lasting, demanding that the operating tribe get its affairs in order first.
The Lewis faction said in a statement Monday that the casino will reopen before the end of 2015. The statement indicated that the Lewis group expects to finalize an agreement in a few weeks with the National Indian Gaming Commission and state Attorney General’s Office.
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An official with Gov. Jerry Brown’s office said Monday that the state continues to work with the tribe.
“Our priority is to help ensure the facility reopens under circumstances that protect the safety of patrons, employees and tribal members,” said Gareth Lacy, the governor’s deputy press secretary. “We are in ongoing conversations and cannot discuss details at this time.”
Another sticking point is dealing with Madera County supervisors, who are yet to recognize a tribal council because members of a faction once led by Tex McDonald are working in the offices across the street from the casino and hotel.
The tribal council Lewis represents is from 2010. It was recognized by the federal Bureau of Indian Affairs last year and affirmed by the U.S. Department of the Interior Board of Indian Appeals in February as interim council until an election, which is scheduled for Oct. 3. The recognition allowed federal grants to flow to the Lewis council to administer through the federal Environmental Protection Agency and Housing and Urban Development.
It was the Chukchansi Economic Development Authority, the body overseeing the casino, that entered into a deal with some of the tribe’s lenders that will allow it to raise $35 million, at a 12% interest rate, to reopen the facility.
The tribe already is under a $250 million bond deal struck in 2012 and is paying 9.75% in interest through 2020. The tribe must pay about $12 million twice each year to its creditors. The bond was for construction of the casino. The tribe missed its last $12 million payment, which was scheduled to be made at the end of March.
Lewis said the two arrangements are separate, equating the new agreement to taking out a second mortgage on a house.
$35 millionThe amount officials say is necessary to reopen Chukchansi Gold Resort & Casino
Lewis has been projecting an October opening for the hotel and casino. Chukchansi’s new chief operating officer, Christian Goode from New York and Las Vegas-based Ivory Gaming, said Monday he is aiming for a Labor Day reopening, but Lewis said he’s not sure that can be achieved.
Other remaining issues that have to be resolved before gaming can resume relate to the county’s reluctance in recognizing a tribal council and forging a new public safety services agreement for the hotel and casino, as well as ensuring the casino and tribal properties can be safe from further conflict between rival factions, Lewis said.
A letter sent by Madera County Board of Supervisors Chairman David Rogers last week said the county supports the tribe in reopening the casino, but is yet to support a particular group as the tribal council.
“We understand that the Chukchansi tribe is presently securing funding and taking steps to establish the lawful governing body of the Chukchansi tribe,” Rogers’ letter said. “Madera County is committed to working with the Chukchansi tribe to develop an agreement once those endeavors are finalized.”
Lewis said a meeting “didn’t go well” earlier this month between the rival factions, which included members of the McDonald group and a faction of Ramirez family members seeking to shrink the tribe to fewer than 50 members.
Supervisor Tom Wheeler, who represents the district where the casino is located, said the funding is positive for the tribe, but he’s not yet convinced that the Lewis group, which also includes rivals Nancy Ayala and Morris Reid, is the correct council for the county to support.
New manager says casino in good shape
The casino will honor unused points or gaming vouchers that casino patrons had from last year before the closure.
Even during the closure, Goode said, tribal officials paid attention to maintenance.
“They did spend time keeping it up, doing preventive maintenance so systems wouldn’t go bad,” he said. “It was properly maintained to the extent possible.”
About 400 of the casino’s 1,800 gaming machines that were leased are gone, but Goode said the leasing companies are eager to get those machines back into operation.
“Bringing back leased machines is not an issue,” Goode said. “They are excited about getting product back out.”
About 400 of the casino’s 1,800 gaming machines that were leased are gone.
He said newer machines will refresh the gaming floor.
Goode also said that the casino has a sufficient number of gaming chips to begin operations.
He said in his experience, it will take three to four weeks from the first day work can start to get the gaming machines up and running.
When the casino closed, court documents say it had 1,044 employees. Nearly all were put out of work.
Goode said that casino officials are beginning a process to bring employees back, many of whom he thinks still need jobs.
“We have a hiring plan that we are working on internally,” he said. “A good portion of those who want to come back to work can come back very quickly; it’s something that shouldn’t be too big of a challenge.”
He said federal gaming officials have been working with the tribe to get the casino open again.
“They share the same goal as everybody else to get the tribe in a position to get its economic engine up and running,” Goode said.
Supervisor Wheeler did say he was encouraged by the Lewis council vote last month that will allow all voters from the 2010 election to vote in the Oct. 3 tribal council election.
The Lewis council voted 4-3 to allow voters who participated in the 2010 election to vote in the next election.
The problem, Lewis said, is that the tribe disenrolled members between 2010 and 2012, which could cause problems making the election official because ballots will be votes cast from those who are not members of the tribe today. He prefers returning to the 2012 voter roll.
“You have to be a member to vote and those people from 2010 are not members,” Lewis said. “Just because the Bureau of Indian Affairs made a decision to recognize the 2010 council doesn’t mean you have to go back to the people who voted in 2010.”
Reid, who voted to allow the additional voters, said that when the BIA made its decision to make the 2010 council the interim council that it meant the voter list should go back to 2010.
He said the interim council, which brought together his faction, Lewis and his supporters and Nancy Ayala’s group, has concerns about how the election will be done.
The casino and resort had more than 1,000 employees when it closed. New Chief Operating Officer Christian Goode said many are available to return to work for Chukchansi.
The three groups, he said, realize they are not always going to agree but they are “out to do what is best for the tribe.”
Wheeler said that adding those roughly 100 to 150 disenrolled members is important.
“Voting eligibility is really a step forward,” Wheeler said.
That combined with the funding to open the casino means he will encourage other factions to talk with the 2010 interim council.
Still, two other factions, the remnants of McDonald’s group and the Ramirez family, have not agreed to the Lewis council’s oversight.
The Ramirez group contends the tribe has only 43 members with a constitutionally “special relationship,” said Luke Davis, a member of the Ramirez family faction. A lawsuit seeking the smaller tribe was dismissed last year by a federal judge.
The McDonald group’s lead lawyer, Les Marston, said the federal government has not formally recognized the 2010 group. He said recognition given earlier this year by the Interior Board of Indian Appeals was limited only to allow federal funding to flow to tribal members who were losing grants and other money after the casino closed.
He said his group’s appeal has not been ruled on. Until it is, he said, they will remain at the office complex on Avenue 417, across from the hotel and casino.