Don’t bet on it
The Upper Lake band of the Pomo tribe want to build a giant, glitzy casino in sleepy West Sacramento. Looks nice, but the government may not be so amenable to the plan.
The Reed Avenue exit off Interstate 80 is on the very western end of West Sacramento. It’s almost as far as you can be from the Capitol Building and still be standing in West Sacramento, but still it’s only a little over two miles from the border between the tiny, but proud, offshoot town from its larger neighbor to the east.
There’s not much happening on Reed Avenue. Sacramento CBS affiliate KVOR Channel 13 makes its home here as does the California Highway Patrol Academy, but, by and large, all that’s located in the immediate vicinity of the exit are empty fields littered with For Sale signs. It’s been that way for a long time.
But where now there are only a few office buildings, a couple of gas stations and two convenience marts, within a few years there could be an Indian casino and a 400-room luxury hotel and spa, where anxious gamblers will be able to try their luck and spend their cash before they even catch a whiff of Nevada.
In October, the Upper Lake Rancheria band of Pomo Indians bought an option on 65 acres of the land around Reed Avenue with the intention of building the casino and hotel. To hear the Upper Lake Pomo tell it, the casino will be much like the gaming cathedrals in Las Vegas; it will house percentage card games, roulette tables, slot machines and craps tables. It will be decorated in Italian style with huge columns with a Tuscan flavor, but with a nod to the Pomo past—there will be a place where original Pomo artwork and artifacts will be on display. And there are plans to ask the big hotel chains—maybe even the Ritz-Carlton—to come and run the hotel.
The man selling the idea of West Sacramento as Little Las Vegas is Roy C. Palmer. Palmer and his company, SRQ Inc., have been hired by the Upper Lake Pomo to facilitate West Sacramento’s, the federal and the state governments’ acceptance of the proposed casino. If the bid succeeds, Palmer’s company will also manage the casino for the Upper Lake Indians. It would be the second urban casino in California.
Palmer isn’t a neophyte in the Indian gaming world. In the late 1980s and early 1990s, he and his partner, Ronald Brown, ran an Indian gaming management company called the Buffalo Brothers, which in 1992 and 1993 ran into a sea of trouble with Wisconsin government officials over how they managed the St. Croix Chippewa casino in Turtle Lake, Wisconsin. Some Chippewa tribal council members alleged that Palmer and his partner were taking a disproportionate share of the casino revenue and filed a federal suit in a bid to get what they considered their money back.
But ultimately, the Buffalo Brothers were bought out by the tribe for millions and prevailed in federal court. Today, Palmer says the whole affair began as a plot by a Minnesota law firm that represented other Indian gaming management companies to squelch the St. Croix Chippewa, and the Buffalo Brothers’ expansion plans. A lawyer from the Minnesota firm denies this.
Palmer’s denials haven’t stopped Marc Burgat from circulating details of Palmer’s Wisconsin legal squabbles. Burgat formed West Sacramento Citizens Against Casinos in October when he learned of the tribe’s plan to build the casino in West Sacramento. Burgat says he has no problem with gaming but he doesn’t want a casino in his backyard. To him, the casino could bring crime and prostitution into a city that has been trying to clean up its act.
“You have an undesirable business coming in with, at best, questionable management,” Burgat says. “That ought to be enough to eliminate that facility from our community.”
But it’s likely that Roy Palmer won’t go that quietly. He and others are part of what could be the next Gold Rush of California—Indian gaming. In March 2000, California voters approved Proposition 1A, which authorized an amendment to California’s constitution that would allow Class III, or Las Vegas-style, gaming on Indian lands. While the proposition is tied up in court currently, if it’s ultimately upheld it could mean billions to Indian tribes all over California and millions to people like Roy Palmer. It could also mean trouble like the kind in which Palmer found himself in Wisconsin, when there was a Gold Rush there after Congress first legalized Indian gaming in some states.
To some, Palmer is symbolic of the excesses of Indian gaming, but to the Upper Lake Pomo, he’s the heavenly prince who will help turn their poverty-stricken band of Pomo into benefactors of a multimillion-dollar business.
Says Upper Lake tribal Chairwoman Carmella Johnson: “Roy was heaven sent.”
Roy C. Palmer has set up shop in the West Sacramento offices of Ramco, Frank Ramos’ development company. Palmer, who resides in the Florida beach city of Sarasota, is in town to pitch the casino to members of the local business community and to talk with the press. The Upper Lake casino deal, he says, has pulled him out of semi-retirement.
Palmer, who’s in his mid-60s, wears his graying hair closely cropped, sports a tan and has grown a bushy, but well-trimmed mustache that falls over his upper lip and curls slightly up from the edges of his mouth. It lends his casual style a flamboyant flair, which is confirmed by a 1997 Sarasota Magazine article that describes his beachfront home. The house includes a ceiling painting “that depicts scenes from his and his wife Susan’s life together, such as the allegorical panel where Susan is lying in a field of sunflowers (she owned a Venice, Florida, flower shop called Sunflowers when they met) and Roy is riding up on a white steed.”
When asked why, after about seven years in retirement, would he come to Sacramento to pitch a casino project that could take years to see through, Palmer says it’s all about helping people.
He came back because of “the enthusiasm that develops in a group, the kind of synergy and internal combustion of, you know, let’s go do something good for somebody.”
About a year and a half ago, Palmer says he became aware that the Upper Lake Pomo were interested in building a casino while he was visiting his brother-in-law, Joe Kelly, in Woodland, California. Kelly had worked in and around casinos for 10 years and knew the Upper Lake Pomo were looking for casino land. Palmer says Kelly is not part of the Upper Lake deal in West Sacramento.
The Upper Lake band decided to work with Palmer after he and his two partners, Philip Kaltenbacher and Robert Roskamp, flew four members of the intertribal council to Sarasota to meet with them. After looking into the men’s business and philanthropic enterprises, the Upper Lake band voted to sign a contract with Palmer’s company. Upon the approval of the National Indian Gaming Commission, SRQ Inc. will take 30 percent of the net revenue generated by the casino, the maximum allowable in California, says Johnson. SRQ, she says, is advancing the tribe the predevelopment costs of the casino.
That the Upper Lake Pomo were looking for land should be no surprise, considering their circuitous route through the past two centuries.
The band is among the 20 federally recognized bands of Pomo who, for the most part, take the Clear Lake/North Coast area as their homeland. In the 18th century, the Pomo’s territory was invaded by Russian fur-traders, who turned the women into whores and servants and the men into slaves to supply the Russians with furs and food. After the Russians abandoned the outpost in the mid-1800s, two American ranchers, Charles Stone and Andrew Kelsey, captured hundreds of Pomo and forced them to work on their ranch in horrible conditions. In 1850, fed up with starvation, whippings and other abuse, five Pomo men killed the two ranchers, prompting a detachment of Army regulars led by Captain Nathaniel Lyon to Clear Lake to punish the Indians. Among other killings led by Lyon’s group, they attacked and killed a tribe that lived on an island on the north side of the lake called the Badonnapoti. The Pomo now call the site “Bloody Island.”
In 1934, Congress passed the Indian Reorganization Act, which sought to restore Indian management of their assets and to establish tribal self-governments. But in the 1950s Congress passed the Rancheria Act, which effectively terminated the previous agreements and displaced the tribes. In 1983, the courts struck the termination down, but by that time some tribes had lost their land, except for personal property. The Upper Lake band, now about 120 strong, were one of those tribes.
Johnson says that following the termination orders of the 1950s, most of what was left of the band spread out across California (Johnson lives in Alameda, California). The casino proposal, she says, is the only way to bring economic recovery to her people.
“We’ve been oppressed, depressed and poverty stricken forever,” Johnson says. “We see this as a way out of poverty and a way to improve the education level of our people for generations to come.”
It’s worked elsewhere—take the Rumsey Band of Wintun Indians, who operate Cache Creek casino in Brooks, California. In 2000, Cache Creek’s CEO told the New Republic that the casino brought in at least $10 million in profit every year, after expenses. At the time, the band had just 42 members, who split the money evenly. That’s at least $230,000 per member, per year. It’s easy to see why Indians would see gaming as a cure to their many financial and cultural ills.
It’s been the familiar refrain of Native Americans ever since the passage of the Indian Gaming Regulatory Act of 1988, which held that if a state allows gaming, then Indians must be allowed to run similar games for profit on tribal-owned land without government interference.
Right after that law passed, Palmer, a former Chicago lawyer, hooked up with former high school track coach Ronald Brown to create the Buffalo Brothers. Four years later, they would be practically run out of Wisconsin—but not without making a small fortune first.
It’s no surprise that the Upper Lake Pomo tribe would be impressed by what they see in Roy Palmer. By all accounts Palmer and his business partners have a regal lifestyle in Sarasota. Tales of their social and philanthropic exploits routinely make the Sarasota social pages. And it’s not without good reason. Both Palmer and partner Robert Roskamp have donated generously to many charities in the Sarasota area.
But Sarasota is a long way from northern Wisconsin, where Palmer lived while managing the Turtle Lake Casino, a Las Vegas-style casino about 90 minutes from Minneapolis.
Palmer was brought into the deal with the St. Croix Chippewas by Brown, who had been leasing slot machines to tribes in the Wisconsin area. Palmer and Brown agreed to go into business as the Buffalo Brothers and locked up a management agreement with the St. Croix tribe, managing the operations for the maximum allowed in Wisconsin, 40 percent of the casino’s net revenue. The partners bankrolled the casino, which opened in May 1992 in the midst of a regional boom of Vegas-type casinos. At the time, according to National Indian Gaming Commission figures, there were just over 20 full-gaming Indian casinos in the United States, the majority of which were in Minnesota and Wisconsin.
Soon after the Turtle Lake Casino opened, however, members of the St. Croix Chippewa tribe went public with concerns that the tribal leadership was freezing out minority opinion and not seeking tribal input on decisions that affected the entire tribe. There were also concerns that the Buffalo Brothers, and not the tribe, were the ones who were benefiting from the initial success of the St. Croix’s gaming enterprises. The Buffalo Brothers made $13.8 million from the Turtle Lake Casino in 1992, according to an article in the Wisconsin-based Progressive, while the tribe made $6.5 million.
Palmer says that the fact the old allegations still come up is a “pain in the ass.”
To answer his critics, Palmer produces a 1994 story from Milwaukee Magazine that alleges that the Buffalo Brothers were essentially targeted by powerful Minneapolis law firm Dorsey & Whitney who represented clients who could have been threatened by the St. Croix tribe’s growth into areas close to the Minnesota/Wisconsin border. Eventually, Dorsey & Whitney represented Ken Mosay, a St. Croix Chippewa tribal council member and others who sued the Buffalo Brothers in federal court.
Dorsey & Whitney “attacked us … in courts, in the newspapers, and made various kinds of threats and accusations,” Palmer says. “They recruited disgruntled minority members of the tribe to help them.”
But Dorsey & Whitney lawyer Mark Jarboe says that by blaming the Minneapolis law firm for the Buffalo Brothers’ problems with Wisconsin state gaming regulators, Palmer is trying to build a “smokescreen.”
“We were lawyers and we had a client from the St. Croix tribe who had a complaint that we thought was correct,” Jarboe says. “To say that it was some jihad against Palmer is not right.”
Still, the Buffalo Brothers faced pressure from Wisconsin state gaming regulators and local politicians after Mosay filed suit against Palmer and Brown in January 1993. Mosay alleged that slot machine agreements between six Wisconsin Indian tribes and Interstate Gaming Services—which was also run by Palmer and Brown—were illegal because they weren’t approved by federal officials. By law, Palmer and Brown were only allowed to take 40 percent of casino net revenue, which they did as the Buffalo Brothers Management company. However, through Interstate Gaming Services the pair also took 30 percent of the revenue from the slot machines. In effect Mosay accused the Buffalo Brothers of double dipping. Mosay also alleged that the contract between Interstate Gaming Services and the tribe wasn’t approved by the National Indian Gaming Commission.
Palmer and Brown’s critics howled that the Buffalo Brothers were exploiting the Indians by taking a far greater percentage of the overall profits generated from the casino than the Chippewas were. Palmer says now that he and Brown went into debt to buy the slot machines. But after leasing them to the tribe and subsequently reaping substantial profits, Palmer says that the Buffalo Brothers tried to convince the tribe to buy the machines from them. Initially, he says, they were reluctant, but after all the negative publicity the tribe agreed.
“We were taking an immense risk,” Palmer says. “I can’t say that I didn’t enjoy making that money, because I did.”
Mosay’s case was seemingly helped in May 1993 when the director of the Wisconsin Gaming Commission, Michael Liethen, wrote and released a report that recommended that the Buffalo Brothers’ state gaming license be revoked. Liethen gave the report to Dorsey & Whitney lawyers after the law firm subpoenaed it. That same day he was fired by the Wisconsin commission chairman, John Tries. Four years later Liethen filed a federal lawsuit that claimed he was wrongly fired for writing the critical report. Tries said at the time that Liethen was fired because he was told to contact the commission if subpoenaed because the commission was planning to fight the order in court. But in 1999, a federal jury ruled that Liethen was a victim of retaliation by his boss, prompting the state to settle with Liethen for $290,000. In 1994, the Progressive reported that Liethen believed he got fired after a meeting between Buffalo Brothers attorney Ray Taffora, who was formerly then-Governor Tommy Thompson’s chief counsel, and Tries. Liethen characterized the meeting as “an effort to interdict my recommendation regarding the Buffalo Brothers.”
Palmer was getting it from the Wisconsin state legislature, too. In December 1993, the Gambling Oversight Committee heard testimony from former Turtle Lake casino workers, who described poor working conditions at the casino. Committee member Harvey Stower—who’s now the mayor of Amery, Wisconsin—says it was “a tense time.”
Stower says he’s “an ardent opponent of gambling, from the lottery on down,” but was especially concerned with the St. Croix situation because he wasn’t sure that the tribal leaders were making the best decisions for the tribe, because “there was only a handful of them who were working closely with Palmer,” he says. “And I didn’t like the way the Buffalo Brothers were treating the tribe.”
While the committee had no authority to recommend or bring any charges against the tribe, eventually the scrutiny wore the Buffalo Brothers down. In March 1994, the tribe bought out the Buffalo Brothers with time still left on their contract. Terms were undisclosed, but it was reportedly for over $30 million.
And just days later, the Buffalo Brothers prevailed over Mosay and Dorsey & Whitney in federal appeals court. The judge ruled in the Buffalo Brothers’ favor largely based on a regulatory snafu. Under the law, management contracts must be submitted to the Bureau of Indian Affairs for approval and other contracts—such as contracts to lease slot machines—would be approved by the National Indian Gaming Commission, which was formed in 1988. While the provisions of NIGC existed when Palmer and Brown set up Interstate Gaming Services to lease slot machines to the St. Croix in the 1989-1990 time frame, the NIGC didn’t itself exist yet, so Palmer and Brown had no one to report to for approval.
Carmella Johnson now says that Palmer was up-front with her about the Wisconsin problems when they met. She trusts Roy Palmer and the other partners.
“We’ve seen the way they live and we looked at their business enterprises and their philanthropy,” Johnson says. “All three gentlemen are wonderful people.”
And they may be. But is there still potential for abuse?
Kelly, Palmer’s brother-in-law, previously had been vice president of a California offshoot of Buffalo Brothers Management and is currently a partner in Lodi, California-based Western Gaming International, which, according to state records, is in the business of supplying gaming related equipment.
When asked whether he would double dip again and also set up a company that would lease slot machines to the Upper Lake Pomo, Palmer says no.
And ultimately, Palmer says he left Wisconsin with no regrets.
“When we left, every single major job in the casino, except the chef, was a member of the tribe and we weren’t doing anything,” he says. “But I cannot deny the fact the political pressures and the pressure from the newspapers that was generated by the law firm of our competitors made it discouraging.”
Marc Burgat seems like just the type of person West Sacramento’s been trying to woo. He moved from Sacramento with his family in May 2000 and settled in the Southport development in Bridgeway Island.
Burgat is the prototypical young urban professional sporting a Kenneth Cole jacket and a short angular haircut. He runs his own public affairs consultancy out of his house and he fancies himself a civic-minded individual.
When he first heard of the casino proposal, Burgat was worried. The way he saw it, West Sacramento was moving in all the right directions with developments like the Riverfront Walk and Raley Field; he didn’t see the logic of a casino in a city that was trying to forget its past, which included prostitution and crime.
“I moved from Sacramento to West Sac because the community was moving forward in a way that I approved of,” Burgat says. “I felt like I was moving into an area that was ripe for growth and had the ability to develop into a really nice community, and what’s happening now is you’re getting a Native American tribe from outside the area moving into the community.”
And Burgat’s not the only casino dissident. Already, a group of anti-casino pastors wrote a letter to the mayor coming out against a casino in West Sacramento.
Johnson says the tribe is trying to go through the process slowly, so the community gets a chance to know and accept them. Still, she doesn’t think it’ll be much of a problem to get the casino built—she thinks there’s a 90 percent chance it will get done. Johnson says that if the community wants the casino, the tribe will put $10 million annually in a West Sacramento redevelopment fund. The money, plus the estimated 2,000 jobs the casino and hotel could provide, should be reason enough for the citizens to put away their concerns and support the tribe, she argues. But in the case it isn’t, Johnson says it will be built somewhere else.
“Should the community not want us, we’ll go elsewhere,” Johnson says. “But should the community not want us, they’d be looking a gift horse in the mouth and we’ll be very hurt as people.”
The tribe has two very important local allies in selling the plan to West Sacramento—Marvin “Buzz” Oates and Frank Ramos, the owners of the land.
Oates and Ramos, in the form of Ranbo Riverpoint Development, are the major landowners around the Reed Avenue area. All together, Ranbo owns about 84 acres.
For more than a decade, previous owners of the parcel and then Ranbo, which bought the land in 1997, have tried to sell it to retailers with no luck. Mall developers, warehouse retailers and discounters have all sniffed around the property, but much to West Sacramento’s chagrin, they’ve passed in favor of other more centrally located areas around Sacramento. The Ramos family is sure to sell the project hard—they missed the retail boom in the late ’90s and the casino might be their only option for a payoff.
“We’ve been asked to reach out and educate the community, so when the Bureau of Indian Affairs does its consulting here the people can give good honest feedback, especially our councilmen,” says Dan Ramos, Frank’s son and project manager of the casino development.
But that raises thorny questions having to do with Ramos’ proximity to power and his ability to finesse the West Sacramento City Council into backing the casino. Being the most recognized business name in town, some would say the Ramos family is the power in West Sacramento (Dan Ramos is the former president of the West Sacramento Chamber of Commerce). One would think sitting on the Reed Avenue land for more than five years with few nibbles must make Ramos and Oates itchy to get a deal done. For his part, Ramos says his group “would pull out in a minute if there was anything overly negative about this project.”
In truth, the proposal has a long way to go before being approved. There are a series of steps the tribe must take to acquire the land for gaming and for the right to have gaming at all. First of all, the land must be placed in a federal trust by the Bureau of Indian Affairs within the Department of the Interior. The tribe also needs a gaming ordinance approved by the National Indian Gaming Commission. The NIGC also must approve an outside management team if the tribe elects to hire one.
All these steps are important and take time, but perhaps the wild card in the West Sacramento casino bid is Governor Gray Davis. He has to approve a compact with the state. And lately Davis has made indifferent, at best, statements about the kind of casino the Upper Lake Pomo are proposing and where it could be situated.
“The governor has vowed not to sign any compacts that put casinos in metropolitan areas,” says Greg Bergfeld, the area director for the National Indian Gaming Commission.
In February, four Bay Area card rooms brought a federal suit seeking to void Proposition 1A. The card rooms brought the suit because another Pomo tribe—the Lytton Band—bought a card room in San Pablo, California, that they would turn into a Vegas-style casino. To do this, however, the Lytton band needed to put the land in federal trust, which would put the card room on tribal ground. To bypass the Bureau of Indian Affairs’ lengthy approval process, the band then had U.S. Representative George Miller, D-Martinez, attach an amendment to an Indian Affairs bill in 2000 that ordered the Interior Department to place the land into a federal trust immediately, thereby making it the Lytton’s tribal land.
The suit, which prevented the Interior Department from putting the San Pablo land into trust, will be decided within the next month. If the card rooms are successful, Vegas-style Indian gaming could be outlawed in California—card rooms and bingo would still be allowed. If the card room’s suit is unsuccessful, Proposition 1A will hold and Indians can have Vegas-style gaming on Indian lands.
After the suit was filed, Governor Davis placed a moratorium on new gaming compacts. At the moment, according to Bergfeld, there are 10 to 15 compacts up for Davis’ approval. If the suit fails, it’s likely Davis will sign them. Still, the West Sacramento casino falls into the urban casino category that Davis has said he’d oppose. Roy Palmer, however, isn’t worried.
“We think with the current economic events, Gray Davis will want to modify his position,” Palmer says. “Let’s face a reality—this project will provide 2,000 jobs at a time when jobs are declining.”
The management team is working on the Upper Lake Pomo proposals for each of the government agencies and will present them sometime next year, Palmer said. Once that happens, the federal agencies and state agencies will investigate West Sacramento public sentiment.
For now, the West Sacramento City Council is trying to show restraint. Burgat says that when he quizzes the individual members, they say it’s too early to speculate. It’s true, says Councilmember Christopher Cabaldon. He went as far as asking the city manager in open session during a December council meeting whether the city has seen a proposal yet. He was trying to make the point that there’s really nothing to talk about until they see one. For the record, the answer was no.
While Cabaldon thinks it’s too early to speculate on any casino when there’s no proposal, the specter of a major Las Vegas-style casino in the city limits has him concerned. In fact, Cabaldon shares many of the concerns with Governor Davis.
“I don’t have any absolute moral objection to gambling,” Cabaldon says. “But I do have up-front concerns about gaming in urban areas.”
It’s likely that’s fine with Palmer. He creatively remarks that Yolo, where West Sacramento is, is an agricultural county, even though the skyline of the capital of California can be seen clearly from the Reed Avenue site.
Palmer has made millions from Indian gaming. The West Sacramento Pomo deal could be his last big score, so he’s working this casino deal hard. Whether he’s working for the tribe or for himself is another question. When asked, Palmer distances himself from prickly details of casino dealing and calls himself a “facilitator,” but really, Roy Palmer is a seller. What else would you call a guy who says he believes in a free enterprise system and adds:
“I hope you believe in the same thing.”