The Sault Ste. Marie Tribe of Chippewa Indians recently announced it will team up with banking executive Jerry Campbell for the tribe’s proposed casino project in Wayne County near Detroit Metro Airport. Campbell was the developer of Pinnacle Race Course in Huron Township that opened during the recession in 2008 and abruptly closed in 2010. The Sault tribe, the largest in Michigan, which operates five small Kewadin casinos in the Upper Peninsula, opened Greektown Casino as a non-tribal venture that declared bankruptcy in 2008, owing 5 million.
Huron Township officials said unpaid taxes are owed on the abandoned, 320-are Pinnacle site. But due to recent state law the county can’t foreclose on the property, in which at least $50 million in capital was invested, including $26.6 million in county-issued bond funds for sewer installation and potential road upgrades, which the county is still paying off. The track’s dirt oval, restaurant pavilion, judge’s tower and stables mostly were financed through $30 million in private money from about a dozen investors, including Campbell, who said he had personally invested more than $6 million and “lost it all and then some.”
The track was forced to close in 2010 after just three years. Campbell a shortened racing schedule during its final season due to state budget cuts plus unsuccessful efforts to partner with the Sault tribe to bring in casino-style gambling. The Sault tribe actually purchased seven acres of racetrack property to pursue a racino there.
Post It Stables, the racetrack corporation, technically owns the land and therefore Campbell, who said he completely left the company in 2010, claimed he and the other racetrack investors do not owe anything. “The taxes aren’t my obligation,” he said.
Campbell said Jack Krasula, a WJR-AM radio show host and founder of Trustinus executive search firm is the majority shareholder of the racetrack venture and took control when the track closed. Krasula said through a representative that Pinnacle’s tax bill “is an ongoing legal question that has yet to be decided.” Krasula is partnering with Campbell in the Sault tribe in the new casino project.
The racetrack investors including Campbell paid $1 for the Pinnacle property in exchange for promising to create or retain 1,100 construction jobs and 1,200 full-time permanent jobs within six years, or face financial penalties. But a 2011 report by the Wayne County Auditor General said the track counted UPS and Home Depot delivery people as full-time jobs.
Turkia Mullin, the former head of the Wayne County Land Bank, arranged the deal. Mullin later became director of Wayne County’s economic development division. Wayne County Commissioner Kevin McNamara recently said he and the other commissioners were “incensed” to learn that the land bank accepted Pinnacle’s jobs claims and transferred title to the 320 acres of land. The county had expected to use it as part of its “aerotropolis” plan. McNamara said commissioners asked to review the jobs documents the track submitted. “We never did get that and we were told at one time that it was lost,” he said.
The tribe’s attorney, John Wernet, said of Campbell, “I’m not aware of anything that was done in connection with Pinnacle Race Course that would cause us to back away and say, ‘He’s not been a good partner.’” Wernet said the Greektown bankruptcy was the result of poor management, the more than 20 percent commercial casino tax rates and amenities requirements by the city of Detroit. “One would argue that most of us learn more from our failures than from our successes,” Wernet said.
He noted the new casino would open in a vacant 71,000 square foot megachurch building, thereby saving construction costs. Also, last month the tribe applied to the U.S. Department of Interior to have the land taken into federal trust, exempting it from local and state taxes. Campbell said he helped the tribe “with finding the land and developing the plans for the land, but they would own 100 percent of the casino.”
The Sault tribe said the Interior Secretary must take the land into trust for any use, including casino gambling, because of the 1997 federal Michigan Land Claims Settlement Act, which compensates the tribe for land taken in the 19th century. This action would allow the tribe to avoid having to gain the approval of the governor and Interior Secretary for the casino. However, former U.S. Rep. Dale Kildee of Flint, the author of the act, said the law was never intended to allow off-reservation casino gambling. In a letter to the U.S. Bureau of Indian Affairs, he wrote, “I would have never sponsored the bill, and the U.S. Congress would never have approved it.”
State Attorney General Bill Schuette has filed a lawsuit to block the casino proposal. Among other issues, he contends the plans violate a tribal-state governing compact because they do not include a revenue-sharing agreement with other Michigan tribes.
The Nottawaseppi Huron Band of Potawatomi, which operates FireKeepers Casino in Battle Creek and the Saginaw Chippewa Indian Tribe, which operates the Soaring Eagle Casino in Mt. Pleasant, also strongly oppose the Sault plan. James Nye, a spokesman for the two tribes, said, “If this legal theory has so much merit, why did the Sault tribe decide to wait 15 years to unveil it?” Wernet said the two opposing tribes just want to protect their own casinos’ business.
While the Sault tribe waits for a decision on its federal land-trust application, Campbell and other non-tribal partners have formed a corporation, JLLJ Corp. Officers are listed as Jerry Campbell, his wife Lisa Campbell, Winfield Cooper III, president of Cooper Commercial real estate in Flint, Krasula and Robert Liggett, the chairman of Big Boy Restaurants.
Records show one of the casino partners bought the megachurch property out of foreclosure from Fifth Third Bank for $950,000 and is holding it for the tribe. “They have brought the resources to bear,” Wernet said.
