Elk Grove City Council Rescinds Development Agreement, Casino Prospects Remain Murky

February 8, 2017 |  

The Elk Grove City Council last night reversed their October 2016 decision and unanimously voted to reinstate a development agreement with the Howard Hughes Company (HHC), owner of the unfinished mall known as the Outlet Collection at Elk Grove on the city's south side along Highway 99.

The action was taken following a successful petition drive seeking to reinstate the development agreement. Sponsored by Emeryville, Calif.-based card room operator Knighted Ventures LLC, the petition gathered enough signatures and was certified for a referendum election.   

The City Council could have deferred their decision, reversed their October 2016 vote, or scheduled a vote as late as November 2018. 

Another large audience packed the Elk Grove City Council
chambers to discuss the controversial $400 million Indian casino.

HHC, which is in the process of selling 36-acres of the languishing shopping center to the Wilton Rancheria for a $400 million Indian casino, asked the Elk Grove City Council last year to kill the development agreement. By removing the development agreement, the parcel would be unencumbered and eligible for placement into federal trust which is needed by the tribe before it can start construction. 

Although the City Council took little time in deliberations, they heard over an hour of public comments, mostly in favor of having the referendum on the development agreement put to the vote of the people. Those who wanted the voters to decide also opposed having a gaming facility in Elk Grove. 

"Gambling is a poison," Elk Grove resident Gee Su said. "I don't want to see another poison come into this community."

Another speaker was Cheryl Schmitt of the Indian gaming watchdog group Stand Up For California (SUFC), who was grilled by Elk Grove Councilman Steve Detrick. As she concluded her remarks during public comment, Detrick suggested Schmitt and her group were funded by competing gaming interests.

Detrick began his query asking Schmitt if she lived in Elk Grove and then asked her if she was funded by the gaming interest. 

"It appears you have millions of dollars," Detrick told Schmitt.

Schmitt responded no to each question and went on to explain to Detrick SUFC's organizational structure and the intricacies of Indian gaming laws.

Before the questioning, Schmitt sharply criticized a press release from the City, noting that while it is true the City does not have the final decision on the casino, "the effect, the consequence of your vote can stall or expedite, the development of the casino, that needs to be said."

"The City has stated in its press release that the council's decision to repeal the ordinance or call for an election will have no impact on the land-into-trust application for the casino project," she said. "That is something the City Council does not know as a fact. That is an unknown. Again, it appears the City in that statement was attempting to mislead the citizens."  

Despite the City Council's decision, after the meeting Wilton Rancheria Tribal Chairman Raymond "Chuckie" Hitchcock expressed confidence said the land would be placed into trust and the project would proceed. He also emphasized the development agreement was between the City and HHC and has no bearing on the Tribe. 

"The City has no jurisdiction over the land," Hitchcock said.

When asked if the land was now in trust, Hitchcock said the Tribe has a notice of decision but acknowledged it was not yet in trust.

"We have a record of decision" Hitchcock said. "Now it is just an administrative process."

Asked what the effect of the vote might have on the casino, Schmitt said it was still undetermined.

"We don't know yet because there were a number of decisions made well after 5 o'clock, Thursday night [January 19] before the inauguration, all of those have been put on hold ...and they will be reviewed by the new administration."

Schmitt added that the vote reinstating the development agreement was a victory for Elk Grove residents.  

"The referendum that the gaming industry put in place was helpful to the citizens of this community," she said. "Whether they went for a vote or rescinded the ordinance, the citizens won."