California's Estom Yumeka Maidu Tribe, also known as
Enterprise Rancheria, has said it will begin construction of a
scaled-down Class II gaming facility in Yuba County, instead of the
Class III facility that has been opposed by neighboring Indian
tribes, beset by litigation and stalled in the state legislature.
The 105,750-square-foot facility will be roughly one-third the size
of the formerly planned 318,000-square-foot Class III casino. The
Tribe has announced that it has secured financing for the
scaled-down project and is ready to break ground.
Enterprise Rancheria is located in Oroville in Butte County but
selected the Yuba County site due to Butte County's saturated
casino market. The Tribe's application to place the land in
federal trust status for gaming cited its historical occupation of
an area including both Butte and Yuba Counties. The Tribe gained
the support of the City of Marysville and Yuba County for its
application with promises of revenue sharing in intergovernmental
agreements executed in 2002 and 2005, respectively.
Recent California Class III gaming compacts require tribes to enter
into local agreements to mitigate impacts, but tribes are under no
obligation to enter such agreements for Class II facilities, which
do not require a compact. Accordingly, the enforceability of those
revenue-sharing agreements depends on whether they can be
interpreted to apply to Class II gaming facilities. Because the
language negotiated in those agreements is not expressly limited to
Class III gaming, the Tribe likely will be obliged to honor the
agreements for its scaled-down casino. The Yuba County agreement
calls for payments ranging from an initial $800,000 to $5 million
at the fifth year of operation.
The Tribe had passed a major milestone on September 1, 2011, when
the Interior Secretary determined that the Enterprise land was
eligible for gaming as an "off-reservation" gaming
facility, also known as a "two-part" determination
pursuant to the Indian Gaming Regulatory Act of 1988
("IGRA"). That determination required the Interior
Secretary to determine that (1) the gaming establishment would be
in the best interests of the Tribe and its citizens, and (2) gaming
on the newly acquired lands would not be detrimental to the
surrounding community. IGRA also requires the governor of the state
in which the gaming will occur to concur in the Interior
Secretary's determination. California Governor Jerry Brown
concurred in the Secretary's determination, and the land was
placed in trust status for gaming on November 21, 2012.
At that point, the Tribe was authorized to conduct Class II
gaming on the land, but Class III gaming would require a Class III
gaming compact ratified by the California legislature and approved
by the Interior Secretary. Governor Brown executed a compact with
the tribe in August 2012, but the California legislature never
acted to ratify it. The Enterprise ratification process was caught
up in the referendum rejecting compacts for the North Fork and
Wiyot Tribes sponsored by Stand Up for California!, a
gaming watchdog group opposed to what it calls "reservation
shopping" by California Indian tribes in general and to
off-reservation gaming in particular.
Enterprise's Class III plan faced its own opposition from
anti-casino groups and neighboring Indian tribes that already offer
Class III gaming in nearby casinos. The United Auburn Indian
Community operates the Thunder Valley casino, and the Cachil Dehe
Band of Wintun Indians of the Colusa Indian Community
("Colusa") operates the Colusa Casino Resort 39 miles
from the Enterprise site. Along with a group calling itself
"Citizens for a Better Way," those Tribes sued the
Department of the Interior for its 2012 decision to accept the
casino site into trust for gaming purposes, complaining that the
Department's process failed to consult neighboring tribes,
violated the National Environmental Policy Act ("NEPA")
and would injure the plaintiffs by "cannibalizing" the
local gaming market.
In August 2014, in response to the California legislature's
failure to ratify its compact, Enterprise filed a federal lawsuit
against the State for failure to negotiate in good faith as
required by IGRA. North Fork Rancheria filed a similar action in
March of this year. California's laws enabling Indian gaming
expressly waive the State's Eleventh Amendment immunity to
tribal suits for failure to negotiate compacts pursuant to IGRA, so
those suits will go forward.
The 2002 agreement with the City of Marysville provided for a
payment of $100,000 upon the land being accepted into trust.
Marysville claims the Tribe now owes it that payment despite the
ongoing litigation challenging the trust acceptance. The Tribe has
not made any payments, but has said it intends to honor its
commitments to the City and County. Meanwhile, both the
Citizens for a Better Way, et al., lawsuit and the
Enterprise lawsuit against the State are pending in federal
court.
Disclosure: Dickinson Wright represents Butte County in gaming
matters.
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