Port Huron's Casino Odds Slim

as posted 1.06.06 at Gaming News:

MICHIGAN – As reported by the Port Huron Times Herald: "The odds of an indian-owned casino being built in Port Huron are slim, those familiar with the issue said this week.

"Nearly five years after city voters approved a referendum on a gaming facility to be built on land at the Thomas Edison Inn near the Blue Water Bridge, the plan lies dormant with a congressional committee. And there seems to be little enthusiasm to revive it.

"The Upper Peninsula's Bay Mills Indian Community in 2001 worked out a proposal to build and operate a casino at the hotel. Gov. John Engler signed off on the deal shortly before leaving office in 2002. It then went to Congress for required approvals.

"'It's a big long shot at this point,' said Jamie Roe, chief of staff for U.S. Rep. Candice Miller, the Macomb County Republican whose district includes Port Huron. Miller supports the casino proposal, although Michigan lawmakers from other communities, especially Detroit, oppose the idea.

"…Meanwhile, some local residents hope the Bay Mills issue gets new life. They are frustrated watching U.S. dollars leave the community to be spent at Ontario's popular Point Edward Charity Casino — directly across the St. Clair River from where the Port Huron casino would be built…"

The Detroit Gaming Syndicators: Marian Ilitch, Michael Malik and Tom Celani

For almost 15 years, the trio of Detroit business leaders has been entangled in a web of casino syndication companies and affiliates. Together they bankrolled MotorCity Casino, The Little River Casino Resort in Manistee and various urban casino proposals with Harrah's and the Bay Mills Indian Community.

In 1993, Thomas Celani (a Bloomfield Hills, MI businessman; once president of his family's prized Detroit Miller Brewing distributorship; ventured into gaming as a major shareholder in slot machine manufacturer SODAK Gaming Inc.) first partnered with Michael J. Malik, Sr. (a Detroit area developer and self-identified entrepreneur) to form North American Gaming (NAG), a developer and operator of gaming facilities. Concurrently Celani formed TVC Enterprises Development Co. to represent his interests and at the same time Malik formed MJM Enterprises Development Co.

Their first big idea came together in 1994: a Bay Mills Indian casino in the Ilitch dominated Foxtown area of downtown Detroit in partnership with Harrah's; the casino would fund a new adjoining major league baseball park. While that plan made little progress, it was the start of an ongoing relationship between Celani, Malik, the Ilitch Family, the Bay Mills Indian Community and Las Vegas heavy-hitters like Harrah’s, Circus Circus and MGM Mirage.

North American Gaming backed and helped finance the 1994 casino ballot proposals in Detroit. Although approved by local voters, Governor Engler blocked the Detroit casinos from moving forward at that time.

In November 1996, Michigan voters statewide approved Proposal E, the creation of three Detroit casinos, by a 52-48 percent margin out of nearly 3.5 million votes cast. Z.R.X. L.L.C. (ZRX), a partnership that would include Celani, Ilitch and Malik bankrolled the campaign supporting Proposal E by contributing $5 million+ to fund an “11th hour” campaign advertising blitz. In recognition of their role in the success of Proposal E, Atwater Entertainment Associates a partnership of more than 100 Detroit area leaders who had originally contributed at least $25,000 each for membership in the LLC had agreed to form Atwater Casino Group (ACG) with ZRX and awarded Celani, Ilitch and Malik 85% ownership interest in ACG.

Within months of the Proposal E victory, Celani and Malik had brought in Circus Circus Enterprises and together with Atwater Casino Group formed Detroit Entertainment LLC, the company behind MotorCity Casino. Circus Circus agreed to provide the capital funding needed for the planning and development of MotorCity Casino and also reimburse Malik and Celani for the costs of the Proposal E campaign -- reimbursement of political contributions is generally not legal in states with post-Watergate political reform laws. Circus Circus would oversee MotorCity's management once it opened. And on November 20, 1997, Detroit Mayor Dennis Archer announced Detroit Entertainment would be one of two entities invited to negotiate casino development agreements with the City of Detroit.

In 1999, word leaked out of the Michigan Gaming Commission that several casino investors wouldn’t be qualified for gaming licenses. Malik was one of those individuals. Before facing disqualification and a reduction of share price, Malik sold his shares in MotorCity Casino to Marian Ilitch, moved into the offices of Ilitch Holdings, Inc. and then went into partnership with her on other gaming projects. Celani and Ilitch retained their collective 35% interest in MotorCity Casino.

Tom Celani was one of those Marian Ilitch bought-out in 2005 when she acquired 100% ownership of MotorCity Casino; however, not before Celani and other minority shareholders in MotorCity Casino sued Ilitch, seeking damages of more than $50 million, saying she violated the terms of their partnership when she negotiated the deal to buyout Mandalay Resort Group's 53.5% interest in MotorCity.

At the same time the trio pursued gaming opportunities in Detroit and plans to establish MotorCity Casino, their North American Gaming (Celani, Malik & Ilitch) began working with the Little River Band of Ottawa Indians on plans for a Manistee, MI, casino resort and the necessary gaming compact required from the State of Michigan. They were instrumental in gaining Compact approvals in 1998.

In July 1999 the Little River Band of Ottawa Indians signed a management services agreement with Celani, Malik, and Manistee Gaming LLC. Celani and Malik were the first in Michigan to be awarded such a contract by an Indian casino. The National Indian Gaming Commission (NIGC) permits such outside contracts for tribal casinos for the first five years of operation with payments up to 30% of profits. The tribe opened their temporary Little River Manistee Casino that same month.

1999 served to be a banner year for Tom Celani when he reportedly pocketed more than $30 million upon the sale of Sodak Gaming Inc. of Rapid City, S.D., to the world's biggest slot machine maker, International Game Technology (IGT) of Reno, Nev. Celani was flush with cashand poised to make some new significant investments.

Throughout the better part of the 1990s; Tom Celani, the Ilitch Family and Michael Malik, expended substantial resources pursuing opportunities in Michigan to expand commercial and Indian gaming. With a couple of big success stories under their belts, the trio decided to parlay their experience beyond Michigan but took different paths.

Starting in 2000, Ilitch and Malik pursued casinos in New York; Hawaii; Barstow, California; and with the Bay Mills Indian Community. It's unclear if Celani was also an investor in any of these projects. In fact, it's not known who if anyone else Ilitch and Malik have included in their various ventures.

Celani, working with attorney James D. “Jim” Oegema, headed west and partnered with the Smith River Rancheria (Smith River Gaming LLC); Paskenta Band of Nomlaki Indians (Luna Gaming –Corning LLC); and Ewiiaapaayp Band of Kumeyaay Indians (Luna Gaming-San Diego LLC). They acquired ownership in the commercial Red-Dolly Casino in Blackhawk, Colorado. Today Celani has consolidated his numerous business ventures under the “Luna” family of companies’ banners: Luna Gaming, Luna Properties and Luna Entertainment. Luna, among other assignments, will now manage the casino in the Cal Neva Resort at Lake Tahoe once owned by Frank Sinatra.

Ilitch/Malik casino syndication partner to run Lake Tahoe casino once owned by Sinatra.

Former MotorCity Casino investor Celani to renovate, run Lake Tahoe casino

By Bill Shea

11:57 am, January 3, 2007

A former owner of Detroit’s MotorCity Casino now plans to operate a Lake Tahoe casino that was owned for a short time in the 1960s by Frank Sinatra

The Nevada Gaming Control Board on Dec. 21 approved Tom Celani’s license to run the Cal-Neva casino in Crystal Bay.

Celani plans to spend $35 million to renovate the 81-year old casino, hotel and spa, the Detroit Free Press reported. He said he’s hired historians to help restore the casino resort, which straddles the Nevada-California line, over a year beginning in April.

Celani’s Luna Gaming Tahoe L.L.C. will lease the casino beginning today from its owner, Namwest L.L.C. Terms of the lease were not disclosed.

Celani, a Bloomfield Hills resident who helped fund the successful 1996 statewide referendum on casino gaming in Detroit, sold his 10 percent stake in MotorCity to Marian Ilitch in April 2005.

PRINTED FROM: http://www.crainsdetroit.com/apps/pbcs.dll/article?AID=200770103002&template=printart

© 2007 Crain Communications Inc.

From the Frank Sinatra Biography ...

"Sinatra lost his Nevada gambling license in 1963 after a Mafia leader, Sam Giancana, was seen in the Cal-Neva Lodge gambling casino in which Sinatra then held a major interest. The license was restored in 1981."

you may also want to see these posts:

* The Verifiable Truth: Ex-owner of MotorCity gets Nev. casino license

* The Verifiable Truth: The Detroit Gaming Syndicators: Marian Ilitch, Michael Malik and Tom Celani

* The Verifiable Truth: History of Cal Neva - Sinatra's one-time casino resort property

Suffolk Life: The Shinnecock speak out on legal battles

01.05.07
The Shinnecock speak out on legal battles

By Susan J. Greenberg

While several questions have been raised regarding a 79-acre piece of land in Hampton Bays known as the Westwoods property members of the Shinnecock Indian Nation are speaking out about the lawsuits, the land use and their overall frustration about dealing with town, state and federal officials.

"This is going way beyond the initial lawsuit," said Shinnecock Tribal Chairman Lance Gumbs.

"This now has turned into a question of whether we are Shinnecock. We are the only remaining tribe in the United States who actually live on our original land. It is very painful."

According to Gumbs, what was at issue in the 1600s is directly related to the issues at hand today, which involve ques­tions of land title, rights of land use, and equitable treatment. "Our territory before the settlers came here was from ap­proximately the town border of Brookhaven to the town border of East Hampton," Gumbs said. "That is the land we roamed."

Three lawsuits, according to Gumbs - two in which the Shinnecock are plaintiffs and one in which they are the defendant - bring to light what he characterized as "some very serious transgressions" that must be addressed.

"The town started this by suing us over our use of the [Westwoods] land," said Gumbs, referring to a suit filed by the town in 2003 seeking to stop the Shinnecock from building a 65,000-square-foot casino on the 79-acre parcel they own in Hampton Bays. "This essentially opened up a dialogue about many issues."

Amid protest by local residents as to the ramifications of building this facility, such as crowding and traffic implications, the case, once under the auspices of Judge Thomas Platt, is now being tried before Judge Joseph Bianco in First District Court in Central Islip. The Shinnecock must prove that the land was originally occupied by them in order for it to be offi­cially recognized as part of their main reservation to the east, and a place where gaming would be permitted under fed­eral law. (Full Story)

Future for the 79-acre property in Hampton Bays are still be debated by government officials and the Shinnecock Indian Nation

01.03.07

FUTURE PLANS

By Susan J. Greenberg

Future plans for the 79-acre property in Hampton Bays are still being debated by government officials and the Shinnecock Indian Nation. However, members of the Shinnecock, believing current lawsuits go beyond the question of land use, are angered over the ongoing battle about their status as a recognized tribe. Photo by Eagle Eye Air Photo

While several questions have been raised regarding a 79-acre piece of land in Hampton Bays - known as the Westwoods property - members of the Shinnecock Indian Nation are speaking out about the lawsuits, the land use and their overall frustration about dealing with town, state and federal officials.

"This is going way beyond the initial lawsuit," said Shinnecock Tribal Chairman Lance Gumbs. "This now has turned into a question of whether we are Shinnecock. We are the only remaining tribe in the United States who actually live on our original land. It is very painful."

According to Gumbs, what was at issue in the 1600s is directly related to the issues at hand today, which involve questions of land title, rights of land use, and equitable treatment. "Our territory before the settlers came here was from approximately the town border of Brookhaven to the town border of East Hampton," Gumbs said. "That is the land we roamed."

Three lawsuits, according to Gumbs - two in which the Shinnecock are plaintiffs and one in which they are the defendant - bring to light what he characterized as "some very serious transgressions" that must be addressed.

"The town started this by suing us over our use of the [Westwoods] land," said Gumbs, referring to a suit filed by the town in 2003 seeking to stop the Shinnecock from building a 65,000-square-foot casino on the 79-acre parcel they own in Hampton Bays. "This essentially opened up a dialogue about many issues."

Amid protest by local residents as to the ramifications of building this facility, such as crowding and traffic implications, the case, once under the auspices of Judge Thomas Platt, is now being tried before Judge Joseph Bianco in First District Court in Central Islip. The Shinnecock must prove that the land was originally occupied by them in order for it to be officially recognized as part of their main reservation to the east, and a place where gaming would be permitted under federal law.

According to Gumbs, the town and the state are putting their witnesses on the stand, which could take months. When asked about the Shinnecocks' actual plans for the parcel, Gumbs said that building an expansive resort - which some officials from the town of Southampton have raised concerns about - was never a plan. "When they were deposing the tribe, we were asked to turn over all relevant documents, which included outside proposals to us," he explained. "We get hundreds of proposals, none of which we are entertaining. The town is trying to assume what we are going to do."

The final outcome of this case, said Gumbs, is related to another suit filed by the Shinnecock against the US Department of the Interior, which runs the Bureau of Indian Affairs, forcing acknowledgment that the Shinnecock are a federally recognized tribe. Although Platt, in November of 2005, issued a ruling that they are indeed a tribe, Gumbs said that the BIA claims it is not bound by the judge's ruling.

"We submitted our initial papers in 1978, and were thwarted with bureaucracy," said Gumbs. "We were recently recognized by Judge Platt as a tribe. It is not the place of the Bureau of Indian Affairs to interpret. We have recognition and it is a matter of law."

Gumbs explained that there are three methods, as enumerated by a 1994 act of Congress, through which a tribe can get federal recognition. "One way is to go through the process and apply to the Bureau of Indian Affairs," said Gumbs. "The second method is by a declaration by Congress or the president. The third is by declaration of a federal judge. Judge Platt recognized us in 2005 and the federal government needs to respect that decision."

Along with the filing of the petition 28 years ago, said Gumbs, the Shinnecock requested that the DOI sue the town on their behalf for a claim to approximately 3,200 acres, reaching from the Shinnecock Canal to the Southampton Village boundary, "from water to water," which were "unjustly acquired" by the government. Using claims that the petition was incomplete, the BIA denied both the petition and the request for legal redress.

Despite the fact that the Shinnecocks have enumerated other situations in which tribes have been accepted and listed through court decision outside of the BIA administrative process, including native tribes in Alaska and California, Gumbs said that the BIA refuses to recognize Platt's 2005 decision.

Officials from the BIA declined to comment on the judge's ruling, but did say that the Shinnecock Nation is on the list, behind seven other tribes, for active consideration regarding their status as a recognized tribe.

According to Gumbs, the purpose of the third lawsuit, filed by the Shinnecock in 2005, is to once again address this land claim and to seek an equitable solution. However, Platt denied the petition this year on November 28, citing a lack of historical basis.

"The judge used a legal theory called 'latches,'" said Gumbs, "where he said that there was no merit to the case because we waited too long to file, and that we didn't sue 'often enough.' This is ridiculous. We have been protesting the wrongful taking of this land, both legally and culturally, since it happened in 1859, when the land was stolen from us."

In fact, said Gumbs, it was shown in court that the Shinnecock had homes and places of worship in the area since at least the 1800s, and that there was a trial in 1922 in which the Shinnecock challenged a property claim in a case against a landowner. "There were protests and court battles at every turn. We think that the judge did not look at all of the issues. We are seeking redress on this decision before we seek an appeal," Gumbs explained.

Gumbs underscored the history of the Shinnecock, saying that their existence can be traced back more than 10,000 years to the first hunters and gatherers who found their way onto the Island. The heart of the matter for the Shinnecock is the sequence of events in history that Gumbs believes led to their land - and culture - being taken from them by the English colonists in the 17th century.

Government officials believe that, while the Shinnecock own those 79 acres of property in Hampton Bays, there are zoning issues that must be addressed. Arguing for the town of Southampton that the Shinnecocks have no legal claim to build on the Westwoods property and that a gaming facility would bring undue traffic and congestion to the area, Michael Cohen, an attorney from the firm Nixon Peabody, said that the real issues are zoning and land use regulations. "It is not whether the tribe owns the property," said Cohen. "They do. What is being contested is whether [Westwoods] enjoys a special status that makes it immune from zoning regulations and state gaming and environmental law."

In order to contest claims by the Shinnecock that the land does enjoy special status, Cohen explained that the town is relying upon the testimony of what he called an "ethno-historian" named James Patrick Lynch, who has a master's degree and "all but a final dissertation" in the study of the indigenous tribes of the Northeast. "He has been working on this matter and has been engaged in connection with this litigation for several years," said Cohen.

"He [Lynch] is a hired gun," Gumbs contended, "used by entities to refute the land claims of tribes. He is a former air conditioning mechanic turned so-called ethno-historian who dropped out of the University of Connecticut in the middle of his doctoral program. He has admitted in court that he has never found a tribe that would qualify for a land claim. How can this be?"

However, according to Cohen, for Westwoods to "have the special status of immunity from local and state law is to disregard 300 years of history about that property." Cohen said that "aboriginal title" must be proven about the parcel for it to enjoy such status, showing that the Shinnecock used it throughout history. "There simply is not enough title evidence to show that this property should have such status," said Cohen.

The Shinnecocks disagree. Will Reed, a member of the Shinnecock Indian Nation, noted that federal recognition from the BIA is not just about building a casino. "It is also about the ability under the federal program for us to acquire certain benefits, such as mortgages and medical and educational assistance," Reed said. "We would be open to federal money to help us complete our infrastructure and start our own police department, which will not only help us, but the community as a whole."

Cohen said that it is the town's intention to examine the potential environmental and traffic effects of a casino or resort, in case it is the Shinnecocks' plan to build one. "In spring of 2003, they announced their plan and cleared five acres," said Cohen. "A resort as big as Foxwoods could be built, with the only limits being economics and imagination."

"Where would we build Foxwoods?" asked Gumbs. "There is simply not enough room. The building that we planned was only as big as the biggest house in Southampton."

Regarding the issues of traffic, Gumbs said that there have been several attempts by the Shinnecock to negotiate with the town and the state to construct an exit off of Sunrise Highway that would prevent traffic overflow into Hampton Bays. "The area on Sunrise Highway surrounding the rest stops is Shinnecock land," said Gumbs. "We can work with the government to ease any traffic concerns, if they want to work with us."

Reed added that he believes a casino could be a financial advantage for the area. "People have to realize the economic benefit to the entire East End of having a large corporation here like a casino, where there is essentially no industry," said Reed. "Even if every member of the Nation quit their jobs and worked at the casino, we would still need to hire 3,000 to 5,000 local employees, who would get full pension and medical benefits, tuition reimbursement and salaries that are much higher than what is being offered in this area by local businesses now. It is hard to make a living out here and building this casino is about security for everyone on the East End, not just Shinnecocks. We want to include everyone.

NPR's Sacramento Bureau Chief says Dem leaders skeptical of Barstow Casino deal

Previously posted by blogger John Myers @ KQED – Capital Notes

03.28.06
Tribal Casino Deal Debated

If the Legislature signs off on a deal to allow two Indian tribes from different parts of the state to converge and build side-by-side casinos in the city of Barstow, will it be making lemonade out of lemons... or setting a dangerous precedent for expansion of tribal gaming?

Those seemed to be the key questions in a marathon hearing of the Senate Governmental Operations Committee that lasted into the evening, and included at least one testy exchange between lawmakers.

Under discussion were gaming agreements between Governor Schwarzenegger and two tribes: San Diego County's Los Coyotes Band of Mission Indians and the Big Lagoon Rancheria of Humboldt County (actually, only Big Lagoon's deal was on the agenda).

The agreements would allow each tribe to build a casino in Barstow, more than 150 miles from Los Coyotes' tribal lands and more than 700 miles from those of Big Lagoon. In part, the deal would settle Big Lagoon's seven year legal battle with the state, which arose over environmental concerns about a casino on the tribe's north coast reservation. Barstow city leaders also support the deal, leading Schwarzenegger tribal negotiator Daniel Kolkey to tell the committee it's a "win-win" agreement.

But two Democrats, committee chairman Sen. Dean Florez (D-Shafter) and Sen. Gloria Romero (D-LA), seemed skeptical and suggested the deal could set a precedent for off-reservation Indian gaming in areas where a tribe has no ancestral ties... (Full Post)

Michigan Senator's re-election realizes $113,000 from Detroit syndicators after she introduces plans for their Port Huron Indian Casino

Background on the financial entanglements between Senator Debbie Stabenow (D-MI), the Bay Mills Indian Community and the Detroit casino syndicators bankrolling the tribe's proposed Port Huron casino and other business ventures.

Throughout the 1990s, the Bay Mills Indian Community, already with two casinos on its existing trust lands in Brimley, MI, has attempted to win approvals to build a casino in more lucrative markets including Detroit, Pontiac and Auburn Hills.

Then, Gov. John Engler (R-MI), who once vowed to oppose any additional casinos in Michigan, cut a deal in late September 2002 to allow the Bay Mills Indian Community to open a gambling parlor on non-tribal land in Port Huron as a way of settling a longtime land dispute with the tribe. The tribe had claimed to own land in Michigan's eastern Upper Peninsula Charlotte Beach community; property that had been given to them by the federal government, but that the state subsequently sold.

Following on Governor Engler's intentions, on September 20, 2002 Senator Debbie Stabenow (D-MI) introduced S. 2986, a bill to approve the Governor's land claims settlement. If approved the bill was intended to allow the Bay Mills Indians to construct a casino in Port Huron, Michigan on the grounds of the existing Thomas Edison Inn at the Blue Water Bridge international crossing. The site is located 350 miles from the Bay Mills reservation but just one hour from Detroit.

A hearing before the Senate Indian Affairs Committee was swiftly organized for October 10, 2002, less than two weeks after S. 2986 was introduced. In introducing S. 2986, Stabenow, the Junior Senator from Michigan, found herself at odds with one of the senior leaders of her party, Senator Harry Reid (D-NV), who has remained opposed to any casino outside a tribe's ancestral territories.

Before September 2002 Senator Stabenow’s previous campaigns for public office had not been backed by the Ilitch Family of Detroit or their casino syndication partners including Michael J. Malik, Sr. (including her first campaign for the U.S. Senate nor several previous terms in the House representing Michigan’s 8th District); however, after introducing S. 2986, records filed with the Federal Election Commission indicate the Ilitch Family and Malik (primarily registered Republicans with a history of giving strategically to some Democrats) directed at least $113,000 toward Stabenow’s 2006 re-election:

• $54,400 Michigan Senate 2006 – Democrat
• $32,000 Stabenow for U.S. Senate – Democrat
• $26,700 Democratic Senatorial Campaign Committee

The Ilitch Family/Malik also contributed to the following leadership PACs, and possibly others, which in turn supported Stabenow's re-election as well:

• $22,000 Friends for Harry Reid/Searchlight Leadership Fund contributed $10,000 on 2/2/05
• $10,100 Friends of Hillary/HILL PAC contributed $10,000; $5,000 each on 6/24/05 & 3/15/06
  

Although S. 2986 was never brought to the floor of the Senate for a vote, recently, in an apparent re-direction of cash flow, Senator Stabenow announced on December 20, 2006 that the Bay Mills Indian Community would receive a $900,000 grant from the U.S. Department of Commerce to further a plastics business venture. According to The Bay Mills News, March 24, 2005, one of the same Detroit casino syndicators behind the Bay Mills casino in Port Huron, Michael Malik, owns 49% of the plastics venture that is the beneficiary of this recent grant.

This $900,000 grant is a small consolation prize for the Port Huron casino if that’s the intention; unless of course, there’s more to come.

12.20.06
the blog, Great Lakes Politics
post from fnemecek 02:31 PM

$900,000 Coming to Chippewa County
U.S. Senators Debbie Stabenow (D-MI) and Carl Levin (D-MI) today announced that the Bay Mills Indian Community and Community College will receive $906,000 to construct a plastics technology research, testing, manufacturing and training center. The funds were awarded through the Economic Development Administration (EDA) of the U.S. Department of Commerce.

“This investment is great news for the economy of Northern Michigan,” insists Ms. Stabenow. “These funds will create good paying jobs in Chippewa County and help bolster economic development throughout the community.”

“This is great news for the eastern Upper Peninsula,” insists Mr. Levin. “This federal funding will bring jobs and investment dollars to the U.P. and help make Michigan a leader in plastics technology.”

This funding will create fifty five new jobs and generate over $2.8 million in private investments, according to the EDA. It is the goal of the EDA to enhance regional competitiveness and promote long-term development in regions experiencing economic hardship.

As reported in the Bay Mills News coverage referenced earlier, during the General Tribal Council (GTC) meeting March 14, 2005 matters involving the tribe’s plastics ventures were questioned by the Bay Mills general membership including the involvement of Michael Malik.

Skirting around the matter, Council leaders avoided any such disclosures and denied a motion that would have required a written report on the plastics venture matter be prepared for discussion at the next Council meeting . Immediately thereafter, the GTC approved a motion to allow the tribe’s executive council to enter into a joint venture agreement regarding the plastics venture presumably involving Michael Malik.

03.24.05
Bay Mills News
Bay Mills GTC “PLASTICS BUSINESS”

… Parker said that Mike Malik is involved in the plastics business because the tribe did not want to expend any tribal funds on the project. He said the initial concept
is to have the business in Kinross until the planned creation of an industrial park on tribal properties at I-75 and M-28…

Another member said that it was his understanding that Malik would invest $1.3 million into the company and would own 49 percent of it, while Bay Mills would own 51 percent. He also recommended a committee be put together to investigate some of these allegations and report back to the GTC with their findings. Parker said he would like to have the tribe do the venture on their own, but said that they did it this way so they would not be out any money.

A motion to have the council report back with paperwork at the next GTC meeting on all of the legal issues presented failed to pass.

A motion to have the Executive Council enter into a joint venture for the Plastics Business carried.

One way or another, it appears the unprecedented “investment” of $113,000 by the Ilitch Family/Malik, channeled to Senator Stabenow’s ’06 re-election campaign, will “pay off” for all involved; what remains to be seen is the ultimate size of the virtual “jackpot.”

You may also want to review these posts:
Great Lakes Politics: Bay Mills & Malik get into Plastics; Senator Stabenow announces they'll get $900,000 federal jumpstart
Candy Land: Calling for More Candy
The Verifiable Truth: Ilitch Family, Associate increased political contributions 2000%
The Verifiable Truth: Six bills in Congress, over six years & political gifts in the six figures: That's what Ilitch Family has invested in Port Huron Casino deal

under the radar in 2006: S&P dropped credit ratings of Detroit's MotorCity -- venture's poor performance and higher leveraged debt cited

Standard & Poor’s dropped CCM Merger, Inc’s (corporate parent of MotorCity) credit rating as a result of MotorCity Casino’s poor performance and mounting debt in the first year since Marian Ilitch took the reigns. In addition, S&P analysts note concern over growing debt ratios facing CCM Merger, Inc. and its single asset portfolio.

6.26.06
Troubled Company Reporter

"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.

MotorCity Casino has been valued at roughly $1 billion by Crain’s Detroit Business. However, to finance the $525 million buyout of MGM Mirage/Mandalay Resort and others in 2005, Forbes indicates Ilitch had to borrow $950 million: $300 million in junk bonds, yielding 8%, and $650 million in fixed- and variable-rate bank debt. Close to $1 billion has been “borrowed” on a casino that’s estimated to be worth $1 billion suggesting MotorCity’s debt to value ratio is approximately 100%.

Ilitches’ acquisition of MotorCity was nearly 100% debt financed, much like their original 1992 acquisition of the Detroit Tigers ball club. That was followed by construction of a 30% taxpayer financed Comerica Park. The Stadium is a cornerstones of the Ilitches’ concentation of slow moving downtown Detroit development. The Ilitches funded the other 70% of Comerica Park using debt financing too. The team has lost money nearly every year since 1993.

Analysts believe that MotorCity’s debt is currently more than 8x its annual operating income, already higher than estimated in the 2005 prospectus announcing the $950 million capital offering. In other words, owners would not realize any profits for at least eight years, the amount of time estimated needed to repay debtors.

Marian Ilitch formed CCM Merger, Inc. in order to buyout the interests of Mandalay Resort/MGM Mirage (Circus Circus Michigan) and take total control of MotorCity Casino, a dba for Detroit Entertainment LLC.

The new credit ratings raise the possibility that holders of $300 million in junk bonds will not be repaid.

Michigan state regulations only permit ownership interest in one casino. When MGM Mirage wanted to acquire Mandalay Resort Group in 2005, the companies were forced to sell one of two Detroit Casinos – either MGM Grand Detroit or MotorCity and the two Las Vegas powerhouses agreed to sell MotorCity Casino and keep MGM Grand Detroit in their portfolio.

In additional actions, Moody’ s credit ratings for MotorCity Casino’s parent were tagged with a Negative Outlook indicating that if anything unexpected happens in the local market, regional economy, casino operations or expansion the next move would certainly be a drop in credit rating.

Standard & Poor's, a division of The McGraw-Hill Companies (NYSE: MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data.

Moody's Investors Service is among the world's most respected, widely utilized sources for credit ratings, research and risk analysis. Moody’s publishes market-leading credit opinions, deal research and commentary, serving more than 9,000 customer accounts at some 2,400 institutions around the globe.

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