The Cowlitz Tribe, owners of the Ilani casino in Washington state, are contemplating ending its gaming partnership with the Mohegan Tribe, the Oregonian reported. The Mohegans helped open their casino six years ago, but their management contract will expire in June of 2024.
The Cowlitz tribe is in the midst of being investigated by the U.S. Justice Department for possible criminal antitrust violations.
The announcement by the Cowlitz Tribal Council was unexpected by the membership. The casino has been very successful, and has welcomed 3 million visitors annually. It is one of the largest employers in its county and generates an estimated $400-$500 million—although accurate figures from tribal enterprises are a closely guarded secret.
Although the tribe could pocket the management fees it pays the Mohegan tribe, it is risky to operate its own casino since it has no management experience.
The Oregonian reported that the council said in a statement that “a public vote on the gaming management agreement will take place at an upcoming Tribal Council meeting.”
Under the agreement the Cowlitz tribe pays the Mohegan Gaming Authority (MGA) 24 percent of net revenues. The MGA, which is a publicly traded arm of the tribal operation, reported that the management fee for 2021 was $61.9 million in management fees and another $2.2 million in development fees, according to the Oregonian.
However, those fees were less in 2022, leading to the conclusion that revenues have peaked. Which might prompt the Cowlitz tribe to want to maximize its profits by removing the Mohegans from the equation.
The FBI has been investigating possible antitrust law violations for several months. The tribe allegedly took possible illegal actions to stifle competition.
The casino—which has grown to be one of the largest in the state—is larger than most of its Oregon competition and has almost completed building a 14-story hotel tower.
The casino began celebrating its fifth anniversary on March 29 with concerts by Loverboy and Rick Springfield and special offers to customers.
