Business & Real Estate

Tribe spends $36 million for planned Elk Grove casino site

Wilton Rancheria wants to build Sacramento County’s first tribal casino on the site of these unfinished structures of an ill-fated mall project on Promenade Parkway in Elk Grove, Calif., on Friday, February 12, 2016.
Wilton Rancheria wants to build Sacramento County’s first tribal casino on the site of these unfinished structures of an ill-fated mall project on Promenade Parkway in Elk Grove, Calif., on Friday, February 12, 2016. Sacramento Bee file

The Indian tribe looking to build a casino on the site of a stalled shopping mall in Elk Grove last month spent about $36 million to buy the land it needs.

Wilton Rancheria and its casino partner, Boyd Gaming of Las Vegas, are both listed as purchasers of the property on records filed with the Sacramento County Recorder’s Office.

The 36-acre parcel purchased by the tribe is part of a larger 100-acre plot that was supposed to be an outlet shopping mall, under the city’s original development agreement with Dallas-based Howard Hughes Corp. The corporation has argued that a casino is needed to drive traffic to the mall, which would now occupy a smaller footprint.

The purchase, in theory, means that the federal government can now take the land into trust for the tribe, which would pave the way for construction on the proposed $400 million casino, hotel and convention center located at the south end of Elk Grove just off Highway 99.

Bob Magnuson, a spokesman for the tribe, declined comment. Boyd Gaming confirmed the transaction but declined to comment further because the company is scheduled to report earnings next week.

Under former President Barack Obama, the U.S. Interior Department had announced its intention to place the land in trust, but the process was not completed. It remains unclear whether the administration of President Donald Trump – a longtime opponent of Indian gambling – would approve the process.

The Elk Grove City Council voted unanimously Tuesday to repeal an ordinance from October that allowed Hughes to sell the land to the tribe for a casino, following an outcry from opponents who gathered 14,900 signatures in support of a referendum to overturn the council’s ordinance. The action this week eliminates the need to hold a costly referendum, but the city has said it effectively has no more say in whether the casino will be built.

“The rest of that is left to the federal and state level,” said Kristyn Nelson, Elk Grove city spokeswoman. “Once it’s taken into trust, it is sovereign land.”

The Bureau of Indian Affairs did not respond to requests for comment.

Howard Dickstein, a Sacramento tribal-law expert who is not connected to the project, suggested that the City Council’s action to repeal the ordinance puts the proposal back into a “gray area,” especially since the Trump administration’s position is unknown. The federal government examines several factors before deciding to take land into trust, including the views of local jurisdictions and the impact on surrounding communities, Dickstein said.

The casino plan’s foes contend it would be a magnet for crime and negatively affect nearby residential neighborhoods. The region’s other Indian casinos are in semi-rural areas.

“I don’t think anyone knows what the policy of the new administration is,” said Dickstein, who has represented various Indian clients, including the tribal owner of the Thunder Valley Casino in Placer County. “We’ll just have to wait and see.”

Richard Chang: 916-321-1018, @RichardYChang

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