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Casino Expansion Continues

13 June 2001

Michigan's casino gaming industry is extremely diverse, but has its growth stalled or is it poised for more expansion and improvements? During the course of the last several weeks, I have received a number of inquires about the status of the Detroit permanent casinos, Michigan tribal casinos slated for New Buffalo and Battle Creek and the potential development of a casino in Port Huron and Allegan County.

From a tribal perspective there are already 11 casinos located in Michigan's Upper Peninsula. The largest has 1,200 slot machines and 20 table games and the smallest has 84 slot machines and 2 table games. Michigan's Lower Peninsula has six tribal casinos with the largest having 4,000 plus slot machines and 50 table games. The five remaining Lower Peninsula tribal casinos are far smaller than 4,000 machines and 50 table games, but they are well crafted entertainment complexes complete with hotel rooms and restaurants. The Lower Peninsula is also home to the Detroit casino market which includes three casinos that have a total of 7,500 slot machines and 250 table games. Needless to say the State of Michigan has a wide array of casino locations and entertainment options.

What about the rumored tribal casinos and Detroit permanent casinos? The answer is: the Battle Creek and the New Buffalo tribal casinos are moving forward, but because of litigation challenging their agreements to operate a casino in the state and federal regulations for certain land issues these projects, have yet to get off the drawing boards. However, the two tribes working on the Battle Creek and New Buffalo projects have received many approvals necessary to make the casinos in these areas of the state a reality. Each development is approximately 12 to 24 months from a likely opening. As for the Detroit permanent casinos, the Mayor of Detroit presented his plan to the City Council several months ago. The Mayor's plan called for moving the MGM Grand Detroit Casino to the Detroit Riverfront and allowing the MotorCity Casino and Greektown Casino to develop their permanent amenities at their current locations. The City Council has yet to weigh in on the issue and it will likely hold off until the new Mayor of Detroit is elected in November of 2001. Once a decision on the location of the permanent casinos is made by the City, construction of these new/additional facilities (hotel, retail, and conference rooms) will take 12 to 24 months to complete.

As it relates to the Allegan County casino, which has been announced to be constructed by the Gun Lake Band in Dorr Township off of US 131, this project will only become a reality after the Gun Land Band enters a class III Tribal State Gaming Compact with the state. In addition, the parcel of land where the casino is to be located will need to be taken into trust by the federal government. If the state does not negotiate a compact with the Band, then the Band may seek approval of its casino project directly from the U.S. Secretary of Interior. However, this process can take a long time and requires the willingness of the Secretary of Interior to approve the deal. So far, the new Secretary of Interior has not seemed inclined to force a compact on a state. In addition, the process to take land into trust by the federal government can be onerous at best. Therefore, although the Band has the federal tribal status which allows it to move forward with a casino, it still must receive the okay of state and federal governments. Thus, it would be difficult to provide a time estimate on this project.

In regard to the Port Huron casino project, an advisory vote is scheduled for June 26, 2001. The ballot language seeks to ask voters if they support a tribal casino to be constructed at the site of the Thomas Edison Inn. The issue for a casino at the Inn has been prompted by the Point Edward Charitable Casino which is located across the river in Windsor, Ontario. If the voters of Port Huron approve the casino project, then the tribe seeking to develop the casino, Bay Mills Indian Community, must obtain a number of governmental approvals. There are a number of variables that would have to be considered in making any estimate on when this project would become a reality, but with the best case scenario it is several years off.

Despite the obstacles that face the Allegan County and Port Huron projects, Michigan's casino gaming industry continues to expand and improve the options available to casino patrons. Many of the state's 17 tribal casinos have undergone massive expansions and renovations during the last two years. Therefore, although the expansion of new casino properties in the state is occurring at a slower rate than a few years ago, the quality of the product offered by Michigan's Indian tribes and the Detroit casinos is ever improving, thus providing more jobs and better entertainment options for Michigan residents and visitors to the state.

David Waddell
David Waddell is an attorney for Regulatory Management Counselors, P.C. (RMC), which assists businesses in navigating the legislative, regulatory and licensing systems governing Michigan’s commercial and tribal casino industries. He is the co-author of The State of Michigan Gaming Law Legal Resource Book and one of the founders of The Michigan Gaming Newsletter.

David Waddell Websites:

www.michigangaming.com
David Waddell
David Waddell is an attorney for Regulatory Management Counselors, P.C. (RMC), which assists businesses in navigating the legislative, regulatory and licensing systems governing Michigan’s commercial and tribal casino industries. He is the co-author of The State of Michigan Gaming Law Legal Resource Book and one of the founders of The Michigan Gaming Newsletter.

David Waddell Websites:

www.michigangaming.com