Board finalizes casino lease
Published 12:11am Thursday, February 16, 2012NATCHEZ — After multiple meetings, several hours spent in closed-door sessions and weeks of community debate, the City of Natchez has finalized its lease with Roth Hill casino developers.
The Natchez Board of Aldermen voted 5-1 at a specially called meeting Wednesday to approve a third amendment to the lease.
Click here for copy of approved lease amendment
Ward 6 Alderman Dan Dillard voted against the third amendment. The board met in executive session with its outside legal counsel, Scott Andress of Balch & Bingham, for approximately 45 minutes before the vote.
Andress briefed audience members on the provisions of the amendment after the executive session.
The provisions in the amendment include:
A modified description of the casino site that moves the casino, on-site parking and parking garage further north.
Monthly non-refundable payments of $50,000 beginning March 1 credited toward the first $1 million rent payment due by the opening of the casino, which is tentatively scheduled for December.
A 10-percent cap on the future adjustment of the casino’s rent payment based on the Consumer Price Index.
An annual payment of $225,000 to a community development fund beginning one year after the casino opens. The payment will be adjusted according to the Consumer Price Index every five years, with a 10-percent cap on future adjustments.
The payment of the $1 million contribution for a YMCA, recreation center or Civil Rights museum to be paid over a three-year period beginning one year after the casino opens. Natchez Enterprises will also pay 5-percent interest on the last two payments that total $666,666, bringing the total contribution to $1,050,000.
The additional 100 parking spaces to be provided for the casino by the city designated by Aug. 31 and built by Dec. 7.
No mention of Levine Leichtman Capital Partners, one of the casino’s investors, as a third-party beneficiary that was in the first draft of the amendment. However, the original lease allows for the company, as a Natchez Enterprises’ investor, to be a leasehold mortgagee.
The city’s acknowledgement that Natchez Enterprises will merge into Natchez Casino OpCo, a company owned by Premier Gaming Group President Kevin Preston, George Lane of Lane Company and Robert Lubin, an attorney from Virginia.
$300,000 for the Natchez Trails Project paid on 18-month anniversary of the casino’s opening.
$300,000 to develop an area near the casino for a public park. The area will also include 50 parking spaces, but the parking will be separately funded by Natchez Enterprises.
Ward 1 Alderwoman Joyce Arceneaux-Mathis said Natchez City Engineer David Gardner requested the board allow him to combine the $300,000 contributions for the Trails and the park. Gardner said after the meeting the combined contributions will be used as a 20-percent cost match to apply for a grant to fund the expansion of the Trails Project along the river and the park as one project.
Gardner said if the city gets a grant using the combined contributions as a match, it will allow an approximately $3 million trails and park project, instead of having separate $300,000 projects.
Dillard said after the meeting he voted against the amendment because he had lost trust in the casino developers over the course of the entire development of the project.
“There was an erosion of the credibility of the developers,” he said. “I wouldn’t be surprised if we’re back here in a few months in a similar position, so they’re going to have to regain my trust.”
Dillard said given the circumstances, he does believe the city got the best possible deal. He said he felt the community involvement and outside legal counsel was critical to the city’s beneficial lease negotiations.
Mayor Jake Middleton said after the meeting he was glad the approval process for the amendment was over. He said Andress provided the board with knowledgeable insight and advice that allowed the city to negotiate the best possible deal.
The third amendment will most likely be the final one, Middleton said. He said he believes the casino will be a project of which the city and its residents will be proud.
“I think in the end everybody can be happy,” he said. “I’m thinking positively, and if you think positive, positive things will happen.”
