Former Pamunkey Chief Slams Tribe’s Virginia Casino Push, Claims Billionaire Using Group
Posted on: September 8, 2020, 11:17h.
Last updated on: September 16, 2020, 08:39h.
UPDATE: Our original article on the Pamunkey Indian Tribe and its former chief has garnered a strong response from tribal members, the community, and other Native Americans. The Pamunkey Indian Tribe released the following statement to Casino.org:
The Tribe has not publicly (outside of the Tribe) disclosed why Mr. Kevin Brown was disciplined by Tribal Body and was forced to step down as Chief. They will continue to keep tribal matters internal to the Tribe. It’s unfortunate to see the comments devolve into hearsay, rumors and more inaccurate information.
Norfolk and the Pamunkey Tribe first started talking about a resort and casino more than two years ago. Together, we identified a suitable piece of property and began to negotiate a purchase price for the property and an intergovernmental agreement. The Tribe agreed to pay full market value (approximately $10 million) for the land. A tribal casino is exempt from state and local property taxes, however, a Tribe pursuing tribal gaming typically enters into an agreement for services from the locality — fire and rescue, police, water, sewer, etc. The City and Tribe had agreed that the Tribe would pay 4 percent of the net gaming revenue (with a minimum payment of $3 million/year) to Norfolk. This was estimated to be approximately $33 million per year. That revenue would certainly exceed expected property taxes, lodging taxes, food and beverage taxes for a project of this size.
That relationship between the Tribe and Norfolk continued once the Virginia General Assembly legalized commercial gaming. At that point, the City and Tribe agreed to convert to a commercial casino (rather than tribal casino), and follow the regulations and tax structure established by the Virginia General Assembly in 2020. It is worth noting, that the new tax structure will have the Tribe pay more than $30 million to the City, with some projections estimated at more than $40 million per year, plus an additional $50 million per year for the Commonwealth of Virginia.
Whether as a tribal casino, or now as a commercial casino, this project represents the largest private economic development project ($500 million) in the City’s history and guarantees an annual revenue stream for the city — all that with NO local or state tax breaks, public subsidies or government funding. That’s why Norfolk is so committed to the Tribe and this project. Our development partner and team have considerable experience in both gaming and financing/developing large-scale, high-end properties over the years. We hire top-tier management and intend to attract talented people to make this a world-class resort and casino.
Original Story Below:
Kevin Brown, the former chief of the Pamunkey Indian Tribe in Virginia, says the Native American group’s efforts to venture into commercial gambling are misguided.
After serving as chief of the Virginia tribe for seven years, Brown was ousted in 2015 after questioning the Pamunkey’s decision to sign a gaming deal with an unnamed casino developer.
“I have seen firsthand the greed and evil a deal like this can bring out in people, and have changed my position regarding gaming as a viable endeavor for the tribe,” Brown said at the time in a letter to tribal members.
Five years later, the Pamunkey Indian Tribe today is partnered with gaming industry billionaire Jon Yarbrough in developing a commercial casino resort in Norfolk.
We have no experience in casinos,” Brown told Casino.org. “We never even ran a bingo game.”
Five cities in Virginia have qualified to approve of a commercial casino. That’s under legislation passed earlier this year that is designed to bring capital investment and an economic spark to struggling areas.
Norfolk is one of those towns, and the city government there has approved of the tribe and Yarbrough’s plan. A local ballot referendum will go before voters Nov. 3, and if the initiative receives a simple majority support, the Norfolk casino project will be fully authorized.
The Pamunkey Indian Tribe is based in West Point, some 20 miles east of Richmond. The small Native American community, consisting of just a couple hundred members, the majority of whom live off the tribe’s 1,200-acre reservation, explored the possibility of building a tribal casino prior to Virginia legalizing commercial gambling.
Brown said the tribe explored land near the Kings Dominion theme park north of Richmond, and Colonial Downs racetrack, located just south of the Pamunkey reservation. The tribe additionally considered Norfolk.
When I was chief, we researched Norfolk, and found out that we virtually have no history or connection with that area,” Brown said. “We could never get land into [federal] trust there.”
Despite Brown’s opinion regarding the Pamunkey’s lack of historical ties to Norfolk, the City Council voted 7-1 in 2019 to sell 13.25 acres of city-owned land next to Harbor Park to the tribe for $10 million.
The Pamunkey’s planned to petition the US Department of the Interior to take the land into federal trust, which would essentially designate the land as sovereign territory, and become primed for a Class I and II tribal gaming operation (no slot machines, house-banked table games).
After Virginia Gov. Ralph Northam (D) signed the commercial gambling law, Norfolk leaders made the tribe its preferred gaming partner, so long as the tribe agreed to operate the resort as a commercial enterprise. It would therefore be subject to gaming, lodging, property, and sales taxes.
Brown, however, says the site adjacent to Harbor Park is “an environmental nightmare.”
Several developers passed on it,” Brown said. “No one knows what is going on. I am not opposed to gaming, I just don’t want the future generations to have to pay for our mistakes.”
“Many people on the reservation do not support the project,” he continued. “Norfolk is 90 miles from the reservation, and nobody is going to drive that distance to work there. We have no money, either. It is a ‘loan to own’ deal. The payments will be larger than the profits.”
The tribe is planning to spend $500 million to build the casino resort. It’s secured financing through its partnership with Yarbrough.
Yarbrough made his fortune manufacturing and selling gaming machines. He sold his company, Video Gaming Technologies, in 2014 to Aristocrat Leisure for $1.3 billion.
Forbes estimates his worth to be $2.6 billion. Brown said the billionaire is simply piggybacking on the Pamunkey Indian Tribe’s arrangement with Norfolk to further enrich his pockets.
Yarbrough is just using us for political reasons so he gets to bid without any competition,” Brown stated.
The Pamunkey Indian Tribe did not respond to inquiries by Casino.org in time for this article’s publication. We will update the story should they comment.