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Seminole Tribe Sued for Back Rent24 October 2002MIAMI – As reported by the Miami Herald:"The Coconut Creek Casino has been a moneymaking machine for the Seminole Tribe, generating an average of $5.1 million in monthly net revenues in the first half of this year. "…The Coconut Creek Casino hasn't been profitable for just the Seminole Tribe. The partnership that built the $20 million casino stands to pocket more than $200 million from a 10-year lease agreement with the tribe. "The tribe, though, has questioned the validity of the lease agreement and has quit making monthly rent payments -- which it says have totaled about $55 million since the casino's opening in February 2000. "The agreement was signed four months later by tribe Chairman James Billie, who was suspended last year by the Tribal Council after it began to investigate the tribe's finances. "…The tribe's decision to stop paying rent prompted Coconut Creek Gaming to sue the tribe this month to force it to pay the balance of the lease payments "…Under the lease terms, the tribe was required to repay Coconut Creek Gaming for the cost of construction, gaming equipment and other start-up expenses from the casino's net revenues. It took the tribe just eight months from the casino's opening to pay back about $20 million to the developer. "…The Seminole Tribe, though, also agreed to pay the developer 'incentive rent' equal to 35 percent of the casino's net revenues, the suit states. The Seminole Tribe began paying the monthly incentive rent in October 2000 after it repaid the construction and start-up costs. "Monthly incentive rent payments were made by the tribe through June of this year before they were stopped. Coconut Creek Gaming claims in a court filing that the monthly incentive rent payments averaged $1.79 million in the last six months it was paid. "…Alan H. Ginsburg, president of Coconut Creek Gaming's Maitland-based general partner, warned in an August letter to the tribe he would seek to recoup the remainder of the rent, 'which could be as much as $200 million.' "…As part of its suit, Coconut Creek Gaming has accused the tribe of inflating the casino's expenses to cause net revenues -- and thus the incentive rent payments -- to be lower than what they should been…" |