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Tribal casino to pay at least $9 million a year to Sonoma County

Graton Rancheria could pay up to $38 million more in deal to offset Rohnert Park casino impacts

By JEREMY HAY
THE PRESS DEMOCRAT
10/20/2012

Published: Saturday, October 20, 2012

The tribe building a casino in Rohnert Park has agreed to pay at least $9 million annually to Sonoma County to offset the impacts of the project, plus up to $38 million more a year if its revenues hit projections.

Facts

TRIBAL PAYMENTS TO SONOMA COUNTY

Under an agreement that Sonoma County supervisors are to take up on Tuesday, the Federated Indians of Graton Rancheria would make a series of payments to the county, including:

ANNUAL PAYMENTS
$3.1 million for law, justice, public safety and tribal relations.
$2 million to the Sonoma
County Transportation Authority to complete work on the Marin-Sonoma Narrows project on Highway 101. After the 10th year, or following completion of that project, the tribe would pay $2 million annually to fund projects on 101 between Highway 12 and the Sonoma- Marin County line or other arterial roads serving casino.
$1.79 million to be paid as development and mitigation fee programs. The payment is equivalent to what a commercial developer would pay in order to obtain a permit.
$1 million to fire districts.
$700,000 to be paid in lieu of county transient occupancy tax once a planned hotel opens.
$600,000 for education, prevention and treatment programs to address gambling addiction and problems associated with substance abuse, mental illness, elder abuse, domestic violence and child abuse and neglect.
$500,000 to mitigate the impacts on local roads within a two-mile radius of the casino.
$416,918 to mitigate crime impacts. Santa Rosa will receive $286,923; Petaluma, $102,591; Sebastopol, $14,596; Cotati, $12,808.
$275,000 for a water conservation program.

ONE-TIME PAYMENTS
The tribe's proposed one-time payments to the county include:
$1.7 million to hire and train four new sheriff's deputies and purchase two new sheriff's vehicles.
$1.5 million for fire and emergency services.
$1.5 million for measures to offset the project's groundwater use.
$370,000 for traffic improvements near the casino.
$60,000 for "tribal relations."

The payments from the Federated Indians of Graton Rancheria, some of which would start this year, are nearly four times what the county previously estimated it would get.

And they are separate from those laid out in a 2003 agreement between the tribe and Rohnert Park, under which the tribe is to pay the city about $200 million over 20 years.

“Without a doubt, I think it's the best agreement that's ever happened between a tribe and a local government,” said Shirlee Zane, chairwoman of the county Board of Supervisors. She lauded the tribe for its participation.

“I think they've set a good role model for other tribal agreements in the future,” she said. “The tribe has been continually trying to put their best foot forward in terms of negotiating and really giving back to the community.”

The county in 2008 concluded that although it opposed the casino, it could not stop it, and reached a deal with the tribe to negotiate payments to address its impacts. Those negotiations led to the agreement announced Friday.

The casino, with a maximum of 3,000 slot machines, is projected to open next year. The tribe secured $850 million in financing in August.

Of the money the county would get, Santa Rosa, Petaluma, Sebastopol and Cotati would share $416,000 a year for law enforcement, and county fire districts would split $1 million.

Page 2 of 4

Also the tribe is to make one-time payments totaling $5.1 million, mainly to address costs associated with public safety, traffic improvements and measures aimed at addressing the casino's anticipated impact on groundwater supplies.

An initial payment of $3.52 million is expected to come in January to cover public safety costs, including the hiring of four new sheriff's deputies.

The agreement extends for 20 years, the term of the gambling compact between the state and Graton Rancheria that allows the tribe to operate a Las Vegas-style casino. That compact required the tribe to sign agreements with the county and Rohnert Park before opening the casino.

Work on the project started in June and its steel framework began rising on 66 acres last week.

The board is to vote on the agreement Tuesday. Zane wouldn't predict the outcome of that vote, but she said the agreement, reached after 3½ months of negotiations, achieved everything the county wanted and more.

“This agreement has met, I believe, every single concern that we've put forward in terms of mitigation,” she said.

“In addition to that, there are community benefit dollars that will come back to the county for mutual interests,” she said, referring to money that the tribe would give the county, primarily for open space projects, if it has money left over after its payments to the state, county and Rohnert Park.

In practice, the tribe is to pay, for the first seven years of operation, 15 percent of its net earnings from gambling to the state into a Graton Mitigation Fund. After seven years, that drops to 12 percent. The state then distributes that fund to Rohnert Park and the county.

Page 3 of 4

In April, the state and tribe projected those earnings, known as net win, as $350 million in the casino's first year, rising to $418 million in its seventh year.

Neither the tribe nor its attorney responded Friday to requests for comment. Nor did opponents of the casino, who are still fighting it in court.

The agreement includes language allowing the county and tribe to reopen negotiations if impacts are found to be greater than projected, something supervisors had pushed for.

“There might be unforeseen issues that come up outside the scope of the agreement, the tribe may want to do something, or the county may recognize something that we want to address, and there's a mechanism to do that,” said Supervisor David Rabbitt, whose 2nd District includes the 254-acre Wilfred Avenue casino site just south of Home Depot.

Over and above the $9 million a year the county is guaranteed, the agreement stipulates that once the tribe meets its financial obligations to Rohnert Park and the state, it will begin paying the county more.

It would give up to $25 million a year to county parks and the county's Open Space District. The money could not be used to buy more land. It would go to create public access to parks and open space, conserve and protect environmental resources, develop organic gardens and farms serving “disadvantaged” people and enhance understanding of local Native American tribes.

Should that $25 million be paid in full, additional monies would go first to other environmental projects and then to the county's Indian Health Project and other Sonoma County tribes that do not run gambling operations.

Page 4 of 4

Asked whether the casino, which has been one of the most controversial projects ever in the region and is still bitterly resented by many, might prove to be a net win for the county, Rabbitt said: “I think that the proof's really in the pudding going forward, and we'll see.”

“My hope is that it will be seen as a positive,” he said. “My hope is that the majority of people will visit the casino in a bus, leave their money here and go home.”



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