Is a Cloverdale casino still on target? Mixed messages raise questions

An Alaskan tribal corporation is rethinking plans for building a large casino resort in Cloverdale, but apparently has not abandoned the controversial project.

Citing the changing "economic and political landscape" along with legal and regulatory hurdles, Sealaska Corp. representatives said they have advised corporate partner Cloverdale Rancheria of a "no-recourse termination of the existing agreements."

Cloverdale City Council members Friday said they were not certain what to make of the language in Sealaska's annual report, since another sentence stated it "continues to engage with the Tribe to revise a strategy that will lead to a successful opening of a gaming facility."

"I think they're really re-evaluating the whole idea," said City Councilman Mike Maacks. "It's obvious corporate doublespeak. It leaves the door open to pursue gambling, but maybe in another direction."

A spokesman for Sealaska said Friday the corporation is not pulling out of Cloverdale, but acknowledged financial challenges for the $320 million project.

"We're very optimistic that we can realize our original goals to help the tribe and work to obtain land into trust and realize a successful and viable gaming operation there," Sealaska spokesman Todd Antioquia said.

He declined to say whether the proposed 596,000-square-foot casino resort might be scaled back, but said the agreement with the Cloverdale tribe "needs to be revised to consider all the new market conditions."

Cloverdale Rancheria tribal leaders did not return calls Friday.

City Councilwoman Carol Russell said it was frustrating that neither the Cloverdale tribe nor Sealaska representatives have informed city leaders of their plans. The 2010 annual report was released in mid-May and there has not been any direct communication with city leaders.

Russell brought the issue to the attention of her colleagues this week and suggested they seek an explanation from the Cloverdale Rancheria.

"It's important for us to know what Sealaska's plans are," she said. "I feel like I got stood up at the prom."

"This is a business we have included as part of what may happen in the near future and if it's not, we need to know about it," Russell said.

The City Council, however, is on record opposing the casino and would not necessarily be the first to learn of changing plans for the project. In 2008, the council passed a resolution against the casino, citing concerns about traffic, possible increase in crime and a loss of land zoned for future industrial use.

And on Wednesday the council agreed to support legislation proposed by California Sen. Dianne Feinstein, which could potentially make it tougher for the Cloverdale tribe to get its project approved.

The legislation is intended to curb "reservation shopping" where tribes obtain land and build casinos far from their ancestral territory.

But it also has a clause that says a tribe's land should be within a 25-mile radius of the area in which a significant number of members of the tribe reside.

Even though the casino would be built on land very close to the original Cloverdale Rancheria, casino opponents note that very few of the tribe's 498 members now live within 25 miles of Cloverdale.

There have been several proposals for casinos by different factions within the Cloverdale tribe, but they've been derailed by infighting, or regulatory and economic hurdles.

The most recent project grew out of a 2007 agreement between the Rancheria and Sealaska, which represents more than 20,000 Native American member-shareholders in southeast Alaska.

Sealaska derives revenue from timber harvesting on land it owns in Alaska and also is involved in other business ventures, ranging from manufacturing to telecommunications and entertainment.

It ventured into gambling a decade ago when it helped a San Diego County tribe build and run the 1,750-slot Valley View casino.

In Cloverdale, Sealaska's subsidiaries purchased 70 acres at the south end of town, just east of Highway 101.

The project, which could generate as many as 9,553 daily vehicle trips, has been under environmental review for several years. It still requires federal and state approvals to be taken into trust and get cleared for gambling.

In its annual report, Sealaska states that since signing the Cloverdale Rancheria development and loan agreements, "Sealaska has seen the economic and political landscape change in many ways."

The changes in original assumptions, it said, "include availability of financing, administrative delays by the U.S. Department of Interior and Bureau of Indian Affairs, several court cases and threatened federal legislation, all of which negatively affect project feasibility."

Sealaska spokesman Antioquia declined to say what aspects of the agreement with the Cloverdale Rancheria are being revised.

But he said the corporation needs "to take into consideration the current availability of financing and its structure related to strategic and business plans associated with the project."