Business & Real Estate

Voters to decide if Elk Grove should get an Indian casino

Sacramento card room owner describes competing against big casinos

As the fight rages over a proposed Indian casino in Elk Grove, Limelight Card Room in Sacramento perseveres against the competition.
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As the fight rages over a proposed Indian casino in Elk Grove, Limelight Card Room in Sacramento perseveres against the competition.

Elk Grove voters apparently are going to decide whether a $400 million Indian casino gets built in their city.

Casino opponents have submitted enough valid signatures to qualify their anti-casino referendum for the Elk Grove ballot, the city clerk announced Friday. The anti-casino effort is being led by a company affiliated with the owner of two Sacramento card rooms.

Besides throwing the casino in doubt, the ballot fight jeopardizes a project long sought by Elk Grove city leaders: a major shopping mall proposed near Highway 99 at the south edge of the city, immediately adjacent to the casino site. The mall’s developer, Howard Hughes Corp., said it needs the casino to drive traffic to the mall.

The Elk Grove City Council now must call a special election and will discuss the issue at its meeting next Wednesday. As an alternative, the council could simply go along with the demands submitted by the petitioners. That would mean reversing an October council vote that paves the way for the big casino proposed by the Wilton Rancheria Indian tribe.

In November, an unidentified group submitted more than 14,800 signatures seeking a referendum that would overturn the council’s October decision. City Clerk Jason Lindgren, in a report Friday to the council, said petitioners had submitted 11,565 valid signatures, according to a sampling he conducted. That was well in excess of the 8,896 signatures needed to qualify the referendum for the ballot.

It wasn’t until three weeks after the petitions were submitted that the identity of the group behind the petitions was revealed: Knighted Ventures LLC, an Emeryville company that provides crucial financial services to card rooms. Knighted Ventures’ clients include Silver F Inc., owner of two card rooms in greater Sacramento: Parkwest Casino Lotus on Stockton Boulevard and Parkwest Casino Cordova in Rancho Cordova.

Card rooms aren’t allowed to take a financial stake in the outcome of their games. They hire companies like Knighted Ventures to handle that task. Knighted Ventures’ employees, stationed at Parkwest’s card tables, make payouts to winners and collect chips from losers.

Joshua Wood of Region Business, an alliance of building contractors supporting the casino, said he believes Elk Grove voters will affirm the council’s decision to approve the casino project. “Now that people know who it is, and know that it is just an out-of-town card room ... the response that we’ve seen from the community is an uproar,” Wood said.

Tribal chairman Raymond Hitchcock said in a prepared statement: “A campaign funded by gaming interests from outside Elk Grove is disingenuous and wrong. They don’t care about the people of Elk Grove. They care about protecting their business interests from fair market competition.”

A spokesman for Knighted Ventures couldn’t be reached for comment. A spokeswoman for the city declined comment.

Normally tribal casinos are subject to approval of the federal Interior Department and the California Legislature, and local residents generally have almost no power to block a project. But opponents in Elk Grove have found an opening to challenge the Wilton tribe’s plan.

The city originally approved Howard Hughes’ plan to build an outlet mall on the Highway 99 site, which currently houses a half-built mall developed by Hughes’ predecessor. In October the city amended its development agreement to allow Hughes to sell a portion of its mall site to the tribe. That second council vote is the target of the referendum.

Hughes has said the casino is essential to helping the mall project pencil out. The Dallas developer hasn’t set a groundbreaking date for the mall.

Dale Kasler: 916-321-1066, @dakasler