Thursday, July 24, 2014

Leaders Gamble on New Cherokee Casino

10/22/2013

Photo by Scott McKie B.P./One Feather Big Cove Rep. Perry Shell and State Rep. Deb McManus, an Eastern Band of the Cherokee Indians member, participate in the Cherokee Friendship Dance with the Warriors of Anikituwah. The dance was part of the ground-breaking ceremony for a new Cherokee Indian casino.

High-flying gamblers will be heading to western North Carolina to take advantage of a new Eastern Band of Cherokee Indians casino in 2015. This could boost local business, including revenues at the nearby public airport. But because the airport authority has operated in secret for years, it’s hard to tell exactly how the extra business might help the underperforming airstrip.

The Eastern Band celebrated a groundbreaking for the new casino last week in western North Carolina’s Cherokee County. The October 15 event was held just east of Murphy on Cherokee trust land abutting some private parcels owned by Murphy’s Wells family. This celebration marked the ceremonial starting point for what will be called Harrah’s Cherokee Valley River Casino and Hotel.

This comes as cutbacks in federal and state grants are hitting U.S. small towns hard. To make up for the loss, here in North Carolina the state Commerce and Transportation departments are identifying proven money-makers that can generate cash in high-unemployment areas. Then these state agencies fast-track highway improvements so known money-makers can get built speedily and their credit-card swipe devices can start processing lots of plastic. Near the top of this fast-track list in North Carolina is the Murphy casino.

On a knoll amid scenic mountains reached by a winding temporary dirt road, an enigmatic and uplifting spiritual tone filled the October 15 groundbreaking for a gambling house.

Larry Blythe, vice chief of the Eastern Band of Cherokee Indians, invoked Psalm 127:1. “Except the Lord build the house, they labor in vain that build it.”

Ray Rose, chairman of the Tribal Casino Gambling Enterprise, prayed for “unity and harmony.”

Michell Hicks, principal chief, said proudly: “When we first started (operating casinos), there was no way we could have borrowed $82 million, but today we can.”

Photo by Scott McKie B.P./One Feather Principal Chief Michell Hicks of the Eastern Band speaks at the groundbreaking event. The tribe is on a narrow margin. In 2009-10, it did a major expansion at its Harrah’s Cherokee Casino and Resort in the Qualla Boundary town of Cherokee (not to be confused with the county of Cherokee) that is 70 minutes’ driving time east of here. That upgrade cost $633 million, according to Reuters, and left the tribe with a good deal of debt.

Another economic reality came in November 2011 when then-Gov. Bev Perdue, a Democrat, proved a tough negotiator. To get a new tribal-state compact allowing live gaming, the Eastern Band agreed to share more casino revenue. The state gets 4% for the first five years. The state’s share rises every five years, reaching 8% after 20 years.

In 2012, a brief, perhaps inadvertent, posting on the Internet of the Eastern Band of Cherokee’s per-capita payments to tribal members every six months was revealing. As of June of that year, the payments were only $3,785. When annualized this comes to $7,570.

So once it opens, the new Harrah’s casino near Murphy will have at least four jobs:

  • Reach more gamblers and hotel guests with cash in their purses and a zest for excitement.
  • Help retire the expansion debt at the older Harrah’s (which dates to 1997).
  • Help pay ever-rising tribal-state compact bills from Raleigh where Pat McCrory, a Republican, now is governor.
  • And increase per-capita payments to tribal members, helping members fully realize casino benefits and climb out of poverty.

Brooks Robinson is vice-president and general manager of Harrah’s Cherokee Casino and Resort. “Behind me in these hills, we’ve got a very promising opportunity,” he said at the groundbreaking ceremony October 15.

“Only One Wet Stream Down There”

Far back in a tribal business plan for the new Murphy casino project, on page 15, is this sentence: “Site/environmental assessments are needed to finalize budget.”

Further demonstrating just how anxious the Eastern Band is to get moving on Harrah’s Valley River casino (the namesake stream runs nearby), it broke ground before receiving a water-quality permit from the U.S. Army Corps of Engineers. The corps jointly enforces the U.S. Clean Water Act with the Environmental Protection Agency.

In June, ClearWater Environmental Consultants of Hendersonville, North Carolina, made a “jurisdictional determination” for the tribe. It found some affected wetlands in the 85-acre site; it’s not clear from the document how many. ClearWater advised the tribe to take advantage of this state’s new Ecosystem Enhancement Program (EEP).

 In this state program -- and these are my words -- you go ahead and harm wetlands as little as you can, and then later do some mitigation somewhere else in the same county. It’s expensive. The current EEP rates, according to ClearWater, currently are “$49,423 per acre for non-riparian wetlands; $68,502 per acre for riparian wetlands; and $374 per linear foot of stream channel.”

Erik Sneed, project manager for the casino project, told me: “There’s only one wet stream down there…We’ve qualified for a (Corps of Engineers) ‘national’ permit and we’re waiting to hear from them.”

Ray Rose, the Tribal Gaming Casino Enterprise chairman, estimated a couple of weeks ago for me that about a million cubic yards of rock and earth will be scraped from a mountain looming at the casino site. Erik Sneed said this mountain is 1,760 feet above sea level. It will be removed from the Earth, sheared off and shoved into the adjacent valley and be the casino’s 56-acre site. Sneed said later that Rose’s estimate might be high. “It may be only a half-million cubic yards,” Sneed said.

 Charlie Deep has an apt name for dealing with water issues. His 4D Engineering of Lexington, South Carolina, is taking the environmental lead for the Cherokees in the Murphy project, and he also was at the casino groundbreaking.

 I asked: “Will you move any of that mountain over there before receiving a Corps of Engineers permit?”

“No,” Deep replied.

Whiting Turner Contracting Company; Owle Construction, LLC; and Cuningham Group Architecture, Inc. An artist's rendering of the planned Harrah's Cherokee Valley River Hotel and Casino. The complex will require moving 500,000 to 1 million cubic yards of earth and filling a valley. Permits are pending with the Army Corps of Engineers.

A Secretive Airport Authority

A key number in the Murphy casino equation is 10. That’s how many miles it is from the casino site to a bucolic landing strip here grandly named Western Carolina Regional Airport. This will offer spectacularly fast rental-car access from an airport to gaming tables. (By comparison, the distance from Asheville Regional Airport to the Harrah’s Cherokee Casino and Resort in the Qualla Boundary is 57.3 miles.)

But at this point it’s hard to tell whether casino visitors will get much use from the airport, and, if they do, whether the county will benefit from any extra revenues.

In the 2013 Cherokee County government document “Airport concerns,” the few hangars here are generously described by the Federal Aviation Administration and N.C. Dept. of Transportation as being below market value. County audits list “concessions,” which are a share of leases collected for a local contractor who is a hangar owner. These average $8,388 each fiscal year and cover less than 3% of airport operating costs of $314,235 for the same period. So having a hangar and tie-downs at Western Carolina Regional Airport is one very good deal that could only get better through sub-leases to high-flying high rollers coming to the new casino starting in 2015.

Maria Hass, Cherokee County assistant county manager. It’s hard to dig into the history of all that because for 26 years, the Cherokee County airport authority or commission or advisory board – it’s had all of those names at various times – never has prepared any meeting minutes as required by state law.

“I wish it was surprising,” said Jonathan Jones, a lawyer and executive director of the N.C. Open Government Coalition. “I can say it’s appalling. I’ve never heard of anyone going that long (without preparing minutes.)”

Amanda Martin of Raleigh’s Stevens Martin Vaughn and Tadych, PLLC, a law firm that’s legal counsel for the North Carolina Press Association, added: “I don’t know of any similar longstanding violation of the Open Meetings Law.”

Recently renaming themselves an advisory board didn’t change things. “It doesn’t matter if a group is performing purely advisory functions,” Amanda Martin said. “The Open Meetings Law includes such groups within the definition of a public body.”

Scott Lindsay is Cherokee County attorney. “There’s no record of their keeping minutes because there aren’t any,” he said. “The county’s equally at fault, because it didn’t tell them to do so.”

In 2013 the Cherokee County Board of Commissioners voted 3-2 to fire all seven airport advisory board members. No action has been taken since, and ousted advisors attend commissioners meetings asking for their jobs back. Meanwhile, the county Finance Department is more aggressively scrutinizing airport spending here over the years.

Maria Hass is assistant county manager. “Everyone is to blame for the shape the airport is in,” she said.

 The airport is an asset not well mined or managed. If county revenues increased, through better airport management and additional income from the new casino, citizens would benefit. More money is needed to add fire stations in hard-to-reach coves and valleys and to fight domestic abuse.

Tom Bennett is a retired Atlanta newsman. He was founding board secretary of the Georgia First Amendment Foundation, which teaches Georgians about open government.

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Cherokee County governmentBoat motors, debris and other non-aeronautical material were stored in the sheriff's hangar at the county airport, in violation of FAA regulations.

 

Flying in the Dark: The Missing Record

SIDEBAR: The Cherokee County, North Carolina, airport board made no official record of its meetings over the past 26 years. What more might we know if the board had complied with the state open-meeting law?

By Tom Bennett

    At a time when earthlings began to receive moving pictures from a spacecraft on Mars, Cherokee County in North Carolina compiled no record of how seven men in an official capacity discussed safety at the county-owned airfield.   They never kept any minutes, breaking North Carolina law.

     How would the little mountain county’s history be expanded and deepened about the following, if a proper record had been kept of what the Secret Seven said to each other about these developments when they happened?

     1960s  On the site of the one-time Cherokee Indian town of Tasetchee, the “construction of the Andrews-Murphy Airport in the nineteen-sixties leveled a townhouse mound,” writes Brett Riggs, UNC Chapel Hill anthropologist and an expert on the Trail of Tears. So for 15 years or more beginning in 1946 when Edgar A. Wood Sr. established an air strip here, pilots took off and landed alongside an Indian mound ultimately leveled.   

     1980 Business executives who flew here to visit manufacturing plants began a letter-writing campaign about the dangers presented by trees at the head of the Andrews-Murphy Airport runway in the east approach zone. These box elders, wild cherry, maple and dogwood steepened the approach path and reduced the runway by 500 feet.

    1986-90 Cherokee County appointed Richard Parker as the fixed base operator for a one-time payment of $1. Later this gracious agreement was amended, requiring Parker to pay Cherokee County two cents per gallon of aviation fuel sold.  In this period, with Parker heading the negotiations, the county began condemnation proceedings on the 12.35 acres at the runway where hardwoods grew, and that were owned by Robey Franklin of Nashville, Tennessee.  But everything went south as Franklin sued Cherokee County. He won and a jury trial awarded him $436,505. “He was in an occupation where he had seen them before (inverse condemnations), and he wanted to get all he could out of it,” Richard Parker told me.  When the lawsuit was settled, the trees at the head of the runway were felled. Months later, Cherokee County received $604,447 from N.C. Dept. of Transportation “regarding the purchase of Robey Franklin property at the east end of the runway,” according to board of commissioners’ minutes. 

      2005 A consultant prepared a draft airport height overlay rendering for the airport here showing how “towers, a grain silo and a grain elevator” rise within the airport protection zone. This rendering would be the starting point for the board of commissioners to adopt an airport height overlay ordinance – something they never have done.

     2005 continued Attorney Gerald Collins, who represented two farming brothers, blocked the ordinance. He charged it would reduce the Wood brothers’ property value.  Cherokee County is one of the last counties in the state with no comprehensive plan as required by state law – and that would be an essential step before adopting an airport height overlay ordinance, Collins said.   There the matter lies.

   2009 Bill Allison, fixed base operator of Andrews-Murphy Airport, was found dead among the wreckage of his 1978 Cessna in the Nantahala National Forest in Clay County, North Carolina.  The Clay County Progress newspaper of Hayesville reported: “A horseback search and rescue team discovered the crash site on Shin Bone Mountain, between Tuni Gap and Fires Creek.”  Allison lived in Helen, Georgia, and frequently flew between two airports he operated, Cleveland, Georgia., Mountain Airpark and Andrews-Murphy Airport.

   2009 Andrews-Murphy Airport was renamed Western Carolina Regional Airport by the Cherokee County Board of Commissioners.

    2010-13 Cherokee County airport rental commissions averaged only $8,338 each fiscal year, so these rare fees at the airport cover less than 3% of its expenditures, which in this same time period have averaged $314,235.   Rental commissions are rents collected by the county in behalf of hangar owner Charles West, a local contractor.

     2012 In an all-important step toward a modern airport here, the N.C. Dept. of Transportation published a TIP, or transportation improvement project, listing 12 steps for improvement of the airport in Cherokee County and estimating the cost at $13.4 million.

    2013 Cherokee County published “Airport Concerns,” listing FAA and Occupational Safety Hazards Administration non-compliance issues at the airport, and also the “lack of fair market value for, and absence of, hangar leases.”