CLOVERDALE CASINO SITE FALLS INTO DEFAULT:ALASKA PARTNER BEHIND $722,000, BUT RANCHERIA OFFICIAL SAYS PROJECT REMAINS ON TRACK

An Alaskan tribal corporation that partnered with the Cloverdale Rancheria to build a casino is in default by more than $722,000 on its purchase of the land it acquired to build the project.

The default notice -- the first step in the foreclosure process -- has fueled speculation that Sealaska Corp. no longer is willing or able to fund construction of the hotel-casino resort.

"With the downturn in the economy and some casinos struggling, we were hoping this was an indication of Sealaska pulling out," Steve Nurse, a longtime casino opponent, said Thursday.

His group, Coalition Against the Casino in Cloverdale, several years ago gathered more than 2,000 signatures in opposition to a casino.

Representatives for Sealaska and the Cloverdale Rancheria declined to discuss the events that led to the default notice filed in late March against Sealaska's subsidiary, Amonos LLC, involving the $8.2 million purchase of the land.

But a corporate spokesman said "we remain hopeful ongoing discussions with the seller will resolve the transaction satisfactorily."

A Cloverdale Rancheria official this week said the casino remains on track.

"As far as we understand, nothing has changed with the project and our partner," said Vickey Macias, Cloverdale Rancheria tribal administrator. "We're still moving forward and have the goal of completing the project."

Cloverdale Mayor Carol Russell said the default on the property is not only odd, but "bizarre."

"You think they'd be able to figure this out and have some type of answer," she said, describing Sealaska as a "sophisticated, nimble company."

She said a default is obviously public information that raises more questions about a highly controversial project that is undergoing scrutiny by federal and state regulators.

Russell said the corporation, which had $201 million in revenues last year and more than $20 million in profits, could seemingly have made the overdue payment with ease and avoided doubts about the casino project.

And its refusal to explain, she said, deepens the mystery.

"Their responses are patented, pre-fab responses you get out of everyone, from major corporations to Lindsay Lohan's reps, that mean nothing," Russell asserted.

Juneau-based Sealaska, formed in 1971, has grown to more than 20,000 Native Alaskan owner/shareholders. Its sources of revenue comes from timber harvesting on land it owns in Alaska. But it also is involved in other business ventures, ranging from manufacturing to telecommunications and entertainment.

A pending bill in Congress would give up to 85,000 acres in the Tongass National Forest to Sealaska for logging. But critics say the logs will be exported directly to Asia, lead to clear-cutting and set a dangerous precedent for privatizing a national forest.

Sealaska has ventured into gambling before. It helped build and manage the 1,750-slot Valley View Casino in San Diego County with the San Pasqual Band of Mission Indians, which opened in 2001. But according to the company's financial statements, its gambling business segment lost $2.76 million in 2009 after producing income of $7.48 million in 2008.

Overall, Sealaska lost $41 million in 2008 after several years of profit, followed by a rebound in 2009.

The Cloverdale City Council, including Russell, went on record against the casino in 2008, citing concerns about traffic, a possible increase in crime and a loss of land zoned for future industrial use where the casino would be built. Cloverdale Rancheria officials, however, say the casino would be a first-rate facility that will help lift the tribe from poverty. According to county records, the default notice stems from two parcels totaling 25 acres that Amonos -- Sonoma spelled backward -- bought in 2007 just southeast of Cloverdale city limits, virtually adjacent to Highway 101.

The site is mostly pastureland with at least one home. But there also are nearby vineyards and other adjacent land acquired by Sealaska subsidiaries, so that the casino project site now comprises a half-dozen parcels totaling about 79 acres, according to the tribe.

Amonos bought the property from Pacific Gulf, a limited liability corporation controlled by Clayton Harris of Yreka, a developer who paid $2.9 million for the property in 2000.

Harris did not return phone calls this week. But in 2007 when he sold to Amonos, he said he bought the property knowing it could be valuable as a site for the casino that the Cloverdale Rancheria had considered building in different locations.

Sonoma County property records show he paid cash for the 25 acres. The default notice states Amonos is $722,301 in arrears to Pacific Gulf, which is officially the lender in the transaction.

The casino project is proposed with 2,000 slot machines and 45 gaming tables in a main hall, a 244-room hotel, a 984-seat convention center, a 1,300-seat entertainment center and almost 1,000 restaurant seats.

But the tribe also has smaller alternatives, including a 169,000-square-foot casino with 1,270 slots and no hotel, convention or entertainment center. The size of the project could hinge in part on the results of an environmental review by federal officials. A draft of the study was expected to be released for public comment last year but has been delayed.

Macias said the state of the economy also could dictate the size and amenities.

The land needs to be taken into federal trust for an Indian reservation, a process that is anticipated to take years. And a gaming compact must be obtained from the governor and approved by the Legislature for Las Vegas-style gambling to proceed.

Sealaska spokesman Todd Antioquia reiterated earlier this week in an e-mail that he could not discuss real estate transactions until they are complete.

"We continue work with the (Cloverdale) tribe to assist them with their goal to achieve federal trust land to clear the way for a gaming facility," he wrote.

News researcher Teresa Meikle contributed to this story. You can reach Staff Writer Clark Mason at 521-5214 or clark.mason@ pressdemocrat.com