September 14, 2009
New agreement stabilizes revenue stream to state, local governments
LANSING - Governor Jennifer M. Granholm and the Nottawaseppi Huron Band of the Potawatomi (NHBP) today announced the signing of an amended gaming compact. The amendment officially takes effect when published in the Federal Register.
The amended compact stabilizes the revenue sharing agreement between the state of Michigan and the tribe and its FireKeepers Casino in Emmett Township near Battle Creek. It also restructures the Local Revenue Sharing Board to include more communities near FireKeepers Casino and clarifies the funding formula for local revenue sharing funds.
"This new agreement benefits the state, the tribe and local communities in Calhoun County," Granholm said. "It creates a better understanding and relationship between the state and the tribe while stabilizing a revenue stream used to enhance Michigan's economic development efforts."
"The amended compact will help create new jobs, new economic opportunities and new revenues for the tribe, local community and the state," said Laura Spurr, tribal chair of the Nottawaseppi Huron Band of the Potawatomi. "It also will help make the Local Revenue Sharing Board more effective by being more inclusive of the local communities affected by FireKeepers Casino."
In the new agreement, the tribe has agreed to a more limited form of gaming exclusivity from the state. In exchange, the tribe's revenue sharing payments to the state for the FireKeepers Casino will be reduced using a sliding scale. For 2009 and 2010, the tribe will pay a fixed 4 percent. For 2011, the tribe will pay 4 percent of up to $100 million in net slot win and 6 percent of net slot win over $100 million. Starting in 2012, the tribe will pay based on a sliding scale of the net slot win for the remainder of the compact term, with payments never exceeding 8 percent of the net slot win. The tribe's contribution to the Local Revenue Sharing Board of 2 percent of the net slot win remains unchanged.
The amended compact also restructures the Local Revenue Sharing Board, expanding it from three to six members. The new board will include representation from Calhoun County, the cities of Battle Creek and Marshall, Athens and Emmett townships and the Huron Band. The new agreement also clarifies funding priorities to avoid conflicts over the allocation of local revenue sharing funds.
Under the original compact, the tribe was required to make revenue sharing payments to the state, but only so long as the state prohibited other new gaming competition elsewhere in Michigan. This provision's meaning became an issue when three other tribes with similar gaming compacts suspended their payments to the state, claiming the state's Club Keno game eliminated the tribes' gaming exclusivity. The Little River Band and the Little Traverse Bay Bands resolved the issue in early 2008, and the Pokagon Band of Potawatomi Indians amended its state compact last fall.
The compact amendment was approved by Governor Granholm and the tribe earlier this year but required federal approval from the U.S. Secretary of the Interior and the Bureau of Indian Affairs. That approval was received September 4, and the amendment officially takes effect when published in the Federal Register. The amendment does not require approval by the state Legislature.
Other changes made by the amendment to the 1998 compact include:
- The length of the compact is extended from 2018 to 2030, ensuring that the tribe has the full 20 years of casino operations anticipated in the original compact.
- The tribe will make payments to the state and Local Revenue Sharing Board annually instead of semi-annually.
- The tribe will pay the state's administrative fees to the Michigan Gaming Control Board associated with their audit responsibilities but will receive credit for amounts paid to the board before the FireKeepers Casino opened.
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