The Catawba Nation is seeking to end its association with SkyBoat LLC, the company that helped the tribe open its temporary Two Kings Casino in Kings Mountain, North Carolina. But cutting ties would require the tribe to pay SkyBoat $125 million, an arrangement that was approved by the tribe’s previous administration, said Catawba Nation Chief Brian Harris, who won election this summer.
Harris said separating from SkyBoat would allow the tribe to resolve the National Indian Gaming Commission’s opposition to SkyBoat’s agreements with the tribe. Last December the NIGC ruled SkyBoat, controlled by politically connected North Carolina businessman Wallace Cheves, violated the Indian Gaming Regulatory Act by negotiating third-party vendor contracts and managing payments for the construction of the temporary Two Kings casino. The NIGC also said the Catawba Nation and SkyBoat failed to submit a management contract within 60 days of its execution, as required by law.
NICG Chair E. Sequoyah Simermeyer said, “Based on an exhaustive investigation and analysis of the circumstances, we issued a Notice of Violation to both enforce regulatory compliance and ensure the Catawba Nation is the primary beneficiary of its gaming revenue.”
Harris, who must sign the agreement for it to be finalized, said, “Our ability to expand for the future growth of our people and our property is very limited under this settlement. That’s very detrimental to us conducting business and generating welfare to our tribal people.”
An attorney for SkyBoat, however, said the settlement amount was based on “reports, data and arguments of the tribe as to why it is a profoundly reasonable resolution. SkyBoat waited patiently for 10 months while NIGC picked apart the deal but ultimately came to the conclusion that it is fair and a commercially reasonable use of gaming revenue that does not violate any of its metrics and guidelines that are in place strictly to protect the tribe.”
In an interview with the Charlotte Observer, Harris said, “The $125 million fee is based on air, so to speak.” He said SkyBoat never provided any documentation or projected revenue losses that would require the payment if the tribe cut ties with the company. “There is no proof as to where the $125 million comes from. SkyBoat is holding hostage this casino resort project and all of the economic and quality-of-life benefits for our people and residents of the area. We need a fair deal so we can realize the full financial benefits of the project, create 2,600 permanent jobs and hundreds of construction jobs and provide local governments and the state of North Carolina with tax revenue and other investments under our compact.”
The Bureau of Indian Affairs in December 2020 approved the South Carolina-based Catawba Nation’s application to take into federal trust a 17-acre tract of historic tribal grounds in North Carolina for gaming purposes. Construction on the permanent $800 million Two Kings Casino has been on hold since the NIGC’s SkyBoat ruling but the tribe opened a temporary casino there in July 2021, offering 1,000 gaming machines and a sportsbook. The permanent facility will feature more 3,000 slot machines and 120 table games plus a 400-room hotel tower and several restaurants.
Harris said the tribe and SkyBoat recently began negotiations to reach a settlement agreement. Regardless of the terms, he said construction on the permanent casino will start in early-to- mid-2024 and be completed within three years. “We have three different options that we’re pursuing,” Harris said.
