Saturday, January 20, 2007

Ilitch syndicates near $3 million lobbying for casinos on Capitol Hill

Various Ilitch/Malik (Team Ilitch) Partners & Affiliates Federal Lobbying Expenditures 2002 - 2006






5 yr total








Bay Mills Indian








Blue Water








Gateway Casino








Little River Band

of Indians







MJM Enterprises

& Development








Indian Nation














Source: as of January 15, 2007, U.S. Senate Office of Public Records;

The Center for Responsive Politics;

The Center for Public Integrity;

Google Earth Maps make it clear why Detroit Casino Syndicators won't settle for anything other than their Barstow location

A Picture (or Google Earth Map) as they say, is Worth A Thousand Words ...

Why have Detroit casino syndicators refused to bankroll casinos on the Big Lagoon and Los Coyotes Reservations or at least within their traditionally recognized ancestral homelands

Well, as they say, a picture's (or these maps are) worth a thousand words.

These 3 Google Earth maps below -- Big Lagoon Rancheria, Barstow and Los Coyotes Reservations -- are shot at the same scale, 43 miles. The yellow line on each map is representative of approximately 45 miles distance, as the crow flies. Each map notes the approximate location of nearby casinos existing or under development today.

The Detroit casino syndicators pushing to relocate the Big Lagoon and Los Coyotes casinos to Barstow, Calif. have shown no interest in financing projects on their partners' existing Reservations or within their traditionally recognized ancestral territories. It is important to realize they came to Barstow seeking to expand their Michigan gaming empire and then sought out Indian tribal partners who would relocate casinos to that community.

The Detroit casino syndicators negotiated an unprecedented 4o-mile radius exclusive non-compete zone around Barstow as part of gaming compact agreements with Governor Schwarzenegger's office. The Governor's former negotiator has indicated these shrewd gaming operators pushed for an even wider exclusivity zone during negotiations.

Big Lagoon Rancheria, Trinidad (Humboldt County) - there are four existing tribal casino operations within close proximity (less than 40 miles) of the existing Big Lagoon Rancheria 20-acre reservation. There are no major urban population centers or larger airports in close proximity to the Rancheria lands nor any high volume traffic corridors. The location is approximately five hours by car to either Sacramento or San Francisco.

Barstow (San Bernardino County) - there are no casinos today within a 50-mile radius of Barstow. The Nevada casinos are located at least 100 miles, as the crow flies, from Barstow and the San Manuel Casino in Highland, Calif., is located 75 miles by car, or slightly more than a one hour car ride away from Barstow. Barstow is located along the high traffic I-15 corridor with an estimated 60 million travelers going through the Barstow area annually enroute to Las Vegas, Utah, Arizona, New Mexico, Colorado and beyond. Although Barstow is not considered a highly urban area it is located 1 - 1.5 hours by car from the Anaheim, Riverside and San Bernardino areas and 2 - 2.5 hours by car from Las Vegas, Los Angeles or San Diego.

Los Coyotes Reservation, Warner Springs (San Diego County) - within a 40-45-mile radius of the 25,000-acre Los Coyotes Reservation there are approximately 20 casinos in operation or under development today; six of those are located within 10-20 miles of the Los Coyotes Reservation. They include some of the largest and most established Indian casinos in the U.S. San Diego County has one of the highest concentrations of casinos in the U.S. The Reservation is approximately 1.5 - 2 hours by car from Anaheim, Los Angeles, Riverside or San Diego. It is not located adjacent to a major interstate nor between any major destination points. There is a casino being developed within 8-10 miles of the Warner Springs area on the Santa Ysabel Reservation.

You may also want to review these posts:
The Verifiable Truth: News contradicts Ilitch, Los Coyotes say about prospects of northeastern San Diego County casino development
The Verifiable Truth:
Tribes doing what Los Coyotes Neighbors describe as impossible

Tribes court Villaraigosa, highlight common ground to advance economic development interests

January 18, 2007

Gambling tribes courting labor's political friends

By James P. Sweeney


TEMECULA – Seeking to reverse recent setbacks and improve their long-range political position, California's gambling tribes moved yesterday to establish common ground with labor-backed Democrats who blocked five new gambling compacts last summer.

The tribes not only invited Los Angeles Mayor Antonio Villaraigosa to speak at a national gaming conference at Pechanga Resort and Casino, but also embraced him as someone who “could be one of our own,” and then gave him an extended standing ovation. Afterward, tribal leaders and others lined up to have pictures taken with the mayor.

Just six years ago, some of the same tribes helped defeat Villaraigosa in his first bid for mayor because he had supported labor's push for stronger collective-bargaining protections in the state's tribal gambling agreements. The issue has not gone away, which is why the pending compacts are stuck in legislative limbo in the state Capitol.

Villaraigosa, a former state Assembly speaker, remains one of labor's most prominent political allies in California. With his election in May 2005 as mayor of the state's largest city, the Democrat has quickly emerged as one of the favorites to become California's next governor.
Many tribes are still at odds with labor, but they recognize that as Villaraigosa's political stature grows, he could serve as someone who could bring adversaries together.

“There's no big mystery here. ... He's in the top tier of likely candidates for governor,” said Pechanga Chairman Mark Macarro. “But he's come looking for nothing other than to re-connect with tribal people and friends, because up until that one bill and that one vote back then, he had been with us.”

The bill was legislation that ratified the Pala compact, an agreement negotiated with former Gov. Pete Wilson when Villaraigosa was speaker in 1998. Villaraigosa helped push the measure through despite opposition from tribes, who objected to collective-bargaining language demanded by labor.

The compact was negotiated on behalf of the Pala band of North County, although all involved agreed that it was intended to serve as a model agreement for other tribes.

Three years later, when Villaraigosa was locked in a tough mayoral race against then-City Attorney James Hahn, tribes weighed in with more than $350,000 for radio and TV ads. One TV spot showed a man smoking a crack-cocaine pipe. The message portrayed Villaraigosa as soft on crime for seeking leniency for an alleged cocaine dealer.

“That was probably one of the worst mistakes we ever made,” said Michael Lombardi, a gaming commissioner for the Augustine band in Coachella and a tribal consultant. “It was not high-brow politics.”

But, Lombardi said, tribes believed Villaraigosa had assured them he would not back the Pala compact. The tribal money in the mayoral race was a response to a similar level of support the tribes believed Villaraigosa had received indirectly from the hotel and restaurant employees union, Lombardi said.

“So we made a mistake. He made a mistake. We're human. . . . This was an effort today to rectify that,” Lombardi said.

“This is the beginning of a new political relationship between California's gaming tribes and Mayor Villaraigosa, and I would say he was a big hit with our membership. This won't be the last time that the Indians and the mayor will be together.”

The effort to reconcile with Villaraigosa quietly began more than three years ago, one tribal source said. A few months ago, Anthony Miranda, chairman of the California Nations Indian Gaming Association, invited Villaraigosa to address the Western Indian Gaming Conference this week. The mayor quickly accepted.

Miranda also had reached out to Gov. Arnold Schwarzenegger in remarks delivered to the same gathering last year. Within months, the chilly relationship many tribes had with the Republican governor had thawed and long-stalled negotiations on new gambling agreements quietly resumed.

In August, Schwarzenegger signed deals that would allow Pechanga, Sycuan of El Cajon and three other tribes to add 22,500 more slots to their already successful casinos. But those agreements were blocked by Assembly Speaker Fabian Núñez, a Los Angeles Democrat and Villaraigosa ally.

Debate on ratification of those compacts is expected to resume soon, but Núñez has made clear he will insist on stronger labor provisions.

Villaraigosa said in an interview yesterday that he was eager to bury past differences with some of the state's most powerful tribes, who are among the state's biggest political contributors.
“I accepted this invitation because I've had a long and positive relationship with the tribes over the years,” Villaraigosa said.

In his remarks, he applauded the tribes for the invitation and echoed their assertion that they have much in common.

“I'm here today because Native American leaders stood up and said 'Enough,' ” said Villaraigosa, apparently referring to the stalemate. “In Los Angeles, in 2005, we practiced what tribal leaders have always preached. We pulled our strengths together, instead of dividing our power. We concentrated on our commonalities, instead of dwelling on our differences. We did it together.

“I'm here to say we need to get together. I'm here to say we need to stay together.”

Find this article at:

Thursday, January 18, 2007

Credit rating of Ilitch held Detroit gaming company (parent of MotorCity Casino) downgraded, given negative outlook after 12+ months

excerpted from

IBL - InterNet Bankruptcy Library

Tuesday, October 17, 2006, Vol. 10, No. 247

CCM MERGER: Moody's assigns Loss-Given-Default Ratings

In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the gaming, lodging and leisure sectors, the rating agency confirmed its B1 Corporate Family Rating for CCM Merger Inc.

Moody's also revised or held its probability-of-default ratings and assigned loss-given-default ratings on these debentures:

Debt Issue










Five Year Senior

Secured Revolver





Seven Year Senior

Secured Term Loan B





8% Senior Secured notes





Moody's explains that current long-term credit ratings are opinions about expected credit loss which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds.

Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha-numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations.

Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%).

CCM Merger Inc. owns and operates MotorCity Casino in Detroit,Michigan.

Tuesday, July 4, 2006, Vol. 10, No. 157

CCM MERGER: Moody's Confirms Corporate Family Rating at B1, Outlook Negative

Moody's Investors Service confirmed CCM Merger Inc.'s B1 corporate family rating, B1 senior secured bank loan rating and B3 senior unsecured note rating. A negative rating outlook was assigned. These rating actions conclude the review process begun on April 17, 2006.

The confirmation considers that despite a recent decline in operating results and high expected peak leverage due to upcoming expansion activity, CCM Merger continues to benefit from being one of only three casinos authorized to operate in Detroit, MI, a high density gaming market that has exhibited a good historical growth pattern.

CCM Merger is also expected to derive some positive impact from the opening of its expanded property as well as the lower tax rate relative to the opening of the expansion. Under Michigan statute, the gaming tax rate for the Detroit casinos will drop from 24% to 19% once the expanded property is opened.

Additionally, in the near-term, the Detroit market should receive some benefit from the smoking ban in Windsor that went into effect on June 1st.

The negative ratings outlook acknowledges CCM Merger's recent lower than expected operating performance which highlighted its vulnerability to aggressive promotional activities by its competitors, despite the historical strength and positive long- term outlook for the Detroit market and recent market share improvement. As a result, CCM Merger is now weakly positioned in its rating category and more vulnerable to a ratings downgrade if future operating results fall short of Moody's expectations.

Moody's most recent rating action on CCM Merger occurred on April 17, 2006 when the company's ratings were placed on review for possible downgrade in light of the company's operating performance in 2005 that was materially below Moody's expectation.

CCM Merger, Inc. owns and operates MotorCity Casino in Detroit, Michigan. The company is currently undergoing a $275 million expansion which will include additional gaming space, restaurant outlets and a new hotel.


Monday, June 26, 2006, Vol. 10, No. 150

CCM MERGER: High Debt Levels Prompt S&P to Downgrade Ratings

Standard & Poor's Ratings Services lowered its ratings on Detroit-based casino owner and operator CCM Merger Inc., including its corporate credit rating to 'B' from 'B+'.

Additionally, all ratings were removed from CreditWatch where they were placed with negative implications on April 7, 2006.

The outlook is stable.

"The downgrade reflects Standard & Poor's assessment that the combination of weaker-than-expected operating performance during 2005, a highly competitive operating environment in the Detroit market, and high debt levels associated with the ongoing expansion project, have resulted in higher-than-expected near-term peak debt leverage that would no longer be consistent with the former rating," said Standard & Poor's credit analyst Michael Scerbo.

As a result of the 6% gaming tax increase effective Sept. 1, 2004, and a much more aggressive marketing environment by competitors, CCM's earnings during 2005 declined materially from the prior year despite revenues remaining relatively flat. This competitive environment continued during the first quarter of 2006 and is likely to remain the case in the near to intermediate term.

Still, over the long term, the market is expected to stabilize, which will enable CCM to reduce debt balances once the expansion of its gaming facility is complete.

However, during the expansionary period, CCM's adjusted total debt to EBITDA is expected to reach 8x in 2006, before potentially declining to levels more appropriate for the new rating in subsequent years. Operating disruptions associated with construction are expected to be limited, given the location of the expansion behind the current facility.

Wednesday, April 19, 2006, Vol. 10, No. 92

CCM MERGER: Slow Revenue Growth Prompts Moody's Ratings Review

Moody's Investors Service placed the ratings on CCM Merger Inc., on review for possible downgrade in light of slow growth of gaming revenues in the Detroit market, and the company's operating performance in 2005 that was materially below Moody's expectations due to unexpectedly competitive market conditions.

Additionally, weak financial performance relative to expectations is occurring at a time when the company's risk profile is elevated due to construction of its permanent gaming facility in Detroit. However, Moody's notes that CCM's cash balance at year-end 2005 is sufficient to support the company's capital spending program.

The review for possible downgrade will consider the overall outlook for revenue growth in the Detroit market, and the degree to which the recently aggressive promotional environment will impact the company's leverage and coverage measures in 2006 in comparison to prior Moody's expectations.

Moody's anticipates concluding this review after the receipt of first quarter results, further discussions with management concerning plans to manage through challenging market conditions, but in any event, within the next 60 days.

Moody's previous rating action on CCM occurred on Jul. 6, 2005 when initial ratings were assigned to the company. The ratings included:

  • a B1 corporate family rating;
  • a B1 rating on the $100 million senior secured revolving credit facility due 2010;
  • a B1 rating on the $650 million senior secured term loan B due 2012; and
  • a B3 rating on the $300 million senior unsecured notes due 2013.

CCM Merger, Inc., owns and operates MotorCity Casino in Detroit, Michigan. For the eighth month period ended Dec. 31, 2005, the company generated approximately $319.9 million in adjusted gross revenues.

Tuesday, April 11, 2006, Vol. 10, No. 86

CCM MERGER: Poor Performance Cues S&P to Put B+ Rating on Watch

Standard & Poor's Ratings Services placed its ratings on CCM Merger Inc., including the 'B+' corporate credit rating, on CreditWatch with negative implications. Detroit-based CCM Merger is the parent company of MotorCity Casino. The CreditWatch listing reflects a decline in MotorCity's operating performance in 2005 relative to Standard & Poor's previous expectations.

EBITDA performance in 2005 fell short of expectations partly due to a more competitive marketing environment in the Detroit market. CCM Merger does not publicly file its financial statements.

Even though revenue growth in 2006 has been positive through February, Standard & Poor's will review CCM Merger's EBITDA expectations for 2006 and in subsequent years, as well as expectations for competitive operating conditions in the Detroit gaming market, when resolving its CreditWatch listing. If the ratings review results in a downgrade, Standard & Poor's expects it would be limited to one notch.

Friday, July 8, 2005, Vol. 9, No. 160

CCM MERGER: Moody's Rates $625 Million Secured Bank Facility at B1

Moody's Investors Service assigned a B1 Corporate Family Rating to CCM Merger, Inc. along with a B1 rating on the company's existing $625 million 1st lien senior secured bank facility. At the same time, Moody's assigned a B3 rating to CCM's new $200 million senior unsecured notes due 2013.

Proceeds from the new $200 million senior notes will be used to refinance CCM's $200 million existing 2nd lien term loan. The 2nd lien term loan, along with $550 million of 1st lien bank debt were used to fund the April 2005 acquisition of the 75% interest in MotorCity Casino not controlled by CCM's principal shareholder, Marian Ilitch.

The ratings consider CCM's high leverage and single asset profile. Pro forma Debt/EBITDA is about 5.2x, however that is expected to increase to almost 7.0x over the next 18-month period as a result of a $275 million expansion project that is expected to be funded with $50 million from cash flow and $225 million of additional senior secured revolver borrowings made available under a greenshoe option contained in the bank loan agreement. Leverage is not expected to decline to below 5.0x until two years following the opening of the expansion.

The two notch difference between the company's B1 senior secured bank loan rating and B3 senior unsecured note rating acknowledges the substantial amount of senior secured debt that will remain in CCM's capital structure over the next few years.

Positive ratings consideration is given to the successful operating history of the casino and the considerable size and density of the <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Detroit gaming market. Detroit's win per unit statistics are among the best of all domestic gaming markets.

Additionally, the Detroit market benefits from Michigan's passageof Proposal 1 in November 2004 that requires a voter referendum for new forms of gaming in that state. Currently, MotorCity Casino is one of three commercial casinos that are permitted to operate in Detroit. The rating also takes into account that the proposed expansion will fulfill CCM's obligation under its development agreement with the City of Detroit, and as a result, will make the company eligible for a reduced wagering tax from 24% to 19%.

The stable ratings outlook is based on the expectation that CCM will reduce acquisition and expansion related debt over time to a level more consistent with its rating. Despite the expectation of continued high leverage, favorable market characteristics including strong demographics, limited competition and high barriers to entry should make it possible for the company to generate free cash flow and reduce debt once the expansion is complete. Separately, the company's bank agreement has been amended so that prior to the completion of the expansion, there is no cash flow sweep, although 75% of excess cash flow will go into an account to be used for construction purposes. Following the completion of the expansion, however, 75% of excess cash flow will be applied towards term loan debt reduction.

CCM's single asset profile, high leverage, and expected free cash flow deficits through fiscal year 2008 limit its ratings upside.

The ratings could go down if CCM fails to comply with the terms of the development agreement with the City of Detroit and/or the company takes on a material amount of additional and unanticipated debt.

These new ratings were assigned:

  • Corporate Family Rating -- B1;
  • $75 million senior secured revolving credit facility due 2010 -- B1;
  • $550 million senior secured term loan B due 2012 -- B1;
  • $200 million senior notes due 2013 -- B3; and
  • Stable ratings outlook.

CCM Merger, Inc. owns and operates MotorCity Casino in Detroit, Michigan. For the twelve-month period ended April 30, 2005, the company generated about $440 million in net revenue.

Friday, July 1, 2005, Vol. 9, No. 154

CCM MERGER: S&P Rates Proposed $625 Million Sr. Sec. Loan at B+

Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Detroit, Michigan-based CCM Merger Inc., the parent company of MotorCity Casino.

At the same time, Standard & Poor's assigned its 'B+' rating and a recovery rating of '3' to the company's proposed $625 million senior secured credit facility, reflecting Standard & Poor's expectation that lenders would realize a meaningful recovery of principal (50%-80%) in the event of a payment default.

In addition, Standard & Poor's assigned its 'B-' rating to the company's proposed $200 million in senior unsecured notes due 2013, reflecting the large amount of priority debt in the capital structure.

Proceeds from the proposed debt issuances will refinance existing indebtedness used to fund the acquisition of MotorCity. The outlook is stable.

"The ratings reflect the expectation for high debt levels over the next few years to fund the acquisition and the future expansion of MotorCity, as well as the company's reliance on a single-property for cash flow generation and construction risks associated with a proposed expansion," said Standard & Poor's credit analyst Emile Courtney. "These factors are partially mitigated by some barriers to new competition in Michigan, as commercial gaming cannot be expanded without a voter referendum, solid customer demographics, and expectations for stable cash flow generation," Mr. Courtney added.

as of December 28, 2006

CCM Merger Issue Ratings


Standard & Poor's**

Corporate Credit Rating



Senior Secured Bank Credit Facility

($650 million)



Senior unsecured

($300 million)



* The ratings from Aa to Ca by Moody's may be modified by the addition of a 1, 2 or 3 to show relative standing within the category.

**The ratings from AA to CC by Standard & Poor's, may be modified by the addition of a plus or minus sign to show relative standing within the category.,1,1,5,0,0,0,0,0,0,0,0,0,0,0,0.html?cspage=or&SearchValue=390542

Equivalent Credit Ratings

Credit Risk


Standard & Poor's*

Investment Grade

Highest quality



High quality (very strong)



Upper medium grade (strong)



Medium grade



Not Investment Grade

Lower medium grade (somewhat speculative)



Low grade (speculative)



Poor quality (may default)



Most speculative



No interest being paid or bankruptcy petition filed



In default



Source: The Bond Market Association

* The ratings from Aa to Ca by Moody's may be modified by the addition of a 1, 2 or 3 to show relative standing within the category.

**The ratings from AA to CC by Standard & Poor's, may be modified by the addition of a plus or minus sign to show relative standing within the category.

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Google News: Indian Gaming

NEWS: Bay Mills Indian Community & Casino Proposals

NEWS: Shinnecock Indian Nation (Gateway Casino Resorts) Casino Proposals

NY Times: Shinnecock Indian Nation

NEWS: Los Coyotes Indian Tribe

NEWS: Los Coyotes / Barwest Barstow Casino Proposals

NEWS: Michael J. Malik, Sr.

NEWS: Marian Ilitch Mapping Social Networks

Play with the interactive tool here or visit

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certainly must reads!

Ilitch has backed loosing sports teams and pizza, but casinos in Detroit? 10.09.06 ● Marian Ilitch #1 on "25 Most Powerful People" to Watch 2006” global gaming business o1.oo.o5 ● My Kingdom for a Casino Forbes 05.08.06 ● Big Lagoon’s casino dream awakens north coast journal 07.28.05 ● Shinnecocks launch legal claim to Hamptons land 06.16.05 ● Ilitch Plans to Expand Casino Empire 07.05.05 ● Ilitch outbids partners 04.14.05 ● Ilitch enmeshed in NY casino dispute 03.20.05 ● Marian Ilitch, high roller 03.20.05 ● MGM Mirage to Decide on Offer for Casino in Detroit 04.16.05 ● Secret deal for MotorCity alleged 02.15.05 ● Los Coyotes get new developer 02.08.05 Detroit casino figure to finance Barstow project 07.07.03 ● Indian Band trying to put casino in Barstow 06.04.03 Pizza matriarch takes on casino roles 10.23.02 ● Vanderbilt gets short straw in negotiations for a casino Lansing Journal 10.06.02 ● Indians aim to drive family from tribe in vicious dispute san diego union tribune 04.09.00 ●Malik owns 2000 Michigan Quarter Horse of the Year 01.01.00 ● Detroit Team to run Michigan’s newest Indian casino 05.23.99 Tiger ties tangle Marian Ilitch 04.29.99 ● Three investors must sell their Detroit casino interests 04.25.99 ● Partners’ cash revived election; They say money was crucial to Prop-E 04.25.99 Investors have troubled histories las vegas review journal 04.27.99 ● Investor served probation for domestic assault on 12 year old boy 04.25.99 Can a pair win a jackpot?: local men hope to... 03.17.97

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