Business & Real Estate

Tribe breaks ground on $170 million Yuba casino

People crowd around the Midi Baccarat tables at the Thunder Valley Casino Resort in Rocklin.
People crowd around the Midi Baccarat tables at the Thunder Valley Casino Resort in Rocklin.

An Indian tribe broke ground Friday on a $170 million casino on the doorstep of Sacramento’s increasingly crowded gambling market, a major milestone for a project whose location has generated political and legal controversy for years.

The Enterprise Rancheria’s Fire Mountain Casino in Yuba County will sit just a half hour’s drive north of Thunder Valley Casino near Lincoln, one of the most successful tribal casinos in the state. It opens as another tribe is considering building a casino in south Sacramento County.

For now, it’s unclear just how much competition will be generated by Fire Mountain, which will open about a year from now. The Yuba County casino will include 50,000 square feet of gambling space, fairly small by modern casino standards. Perhaps more importantly, the Enterprise tribe only holds a so-called Class II license, which limits it to electronic versions of bingo and other games and prohibits full-fledged slot machines and table games.

The tribe’s licensing status could change. A federal judge in February ordered the state to enter into a gambling compact with Enterprise. That would elevate the tribe to a Class III license, allowing a true Vegas-style venue with games and machines comparable to Thunder Valley, Cache Creek and other big tribal casinos in the region.

In the meantime, Enterprise consultant Charlie Banks-Altekruse said the tribe is focused on building Fire Mountain despite the current limitations on the types of gambling it can offer. Customers will notice very little difference between Fire Mountain and other casinos, he said.

“It’s going to have the look and feel of a traditional casino,” he said.

He said the property, located near the Toyota Amphitheatre, will include restaurants, bars, gift shops and meeting space. If the tribe is able to get a Class III casino license, it would consider expanding the casino and building a hotel. Alan Ginsburg, a developer from Florida, is financing the effort for the tribe, Banks-Altekruse said.

Fire Mountain should be able to coexist with its neighbor to the south, he added.

“Maybe people come up for the day from the Bay Area, spend the morning at Thunder Valley and come up and spend the afternoon with us,” he said.

Doug Elmets, a spokesman for Thunder Valley and its owner, the United Auburn Indian Community, said Thunder Valley doesn’t expect to lose any customers to the newcomer.

“It will have no effect,” he said. “None.” He dismissed Fire Mountain as “nothing more than an elaborate bingo hall.”

The United Auburn tribe has led the legal and political fight to keep the Enterprise tribe from getting the more valuable Class III casino license. Elmets said he doubts Enterprise will obtain that license, at least for the foreseeable future, despite the judge’s ruling.

“The fight is not over,” the Thunder Valley spokesman said.

The legal dispute over whether Enterprise should get a Class III license centers on geography and tribal history.

Formally known as the Estom Yumeka Maidu Tribe of the Enterprise Rancheria, the tribe has its origins and tribal office in Butte County. That’s about 35 miles away from the casino site in Yuba County. The tribe got permission from the U.S. Interior Department in 2013 to acquire the Yuba property.

The California Legislature, however, was uncomfortable with the location. Although the tribe signed a gambling compact with Gov. Jerry Brown, which would have permitted a full-fledged casino, the Legislature declined to act on the agreement. The deal expired in 2014.

The Legislature balked after numerous tribes, including Thunder Valley’s owner, lobbied hard against the agreement. Their argument: California voters in 2000 approved Vegas-style tribal casinos that would be located on ancestral lands. Enterprise shouldn’t be allowed to build on a spot so far removed from the tribe’s origins.

Despite the Legislature’s inaction, a federal judge in Sacramento strengthened the Enterprise tribe’s hand considerably in February. Ruling on a lawsuit filed by the tribe, U.S. District Judge Troy Nunley said the Legislature acted in “bad faith” by not taking any action on the compact that was signed by Brown.

Nunley ordered the state and the tribe “to conclude a gaming compact within 60 days,” which would set a deadline of sometime in mid-April.

Elmets, however, said a compact “will be many years away. There are many legal hurdles they have to overcome.”

Two other lawsuits are pending over the Enterprise tribe’s project, including a case filed by the owners of Thunder Valley and Cache Creek casinos over environmental questions and potential impacts on other casinos. The judge ruled in favor of the Enterprise tribe in that case, too, although he is being asked to reconsider.

“Despite the ground being broken, this is still unsettled,” said Cheryl Schmit of Stand Up for California, an anti-gambling organization in Penryn.

The Yuba County venue would add to the proliferation of gambling options in Northern California. The Wilton Rancheria is looking at two sites in southern Sacramento County, one in Elk Grove and one in Galt for a casino and 12-story hotel. Casinos in the greater Sacramento market also have been affected by the 2013 opening of the $800 million Graton Resort & Casino in Sonoma County.

Dale Kasler: 916-321-1066, @dakasler