PREPARED BY: MATT RODRIGUEZ DATE OF MEETING: 08/05/2024
SUBJECT:
TITLE
CONSIDER CITY COUNCIL AUTHORIZATION TO: (1) RATIFY A COMMENT LETTER TRANSMITTED ON JULY 22, 2024 BY SAN PABLO MAYOR PONCE TO THE UNITED STATES DEPARTMENT OF THE INTERIOR, BUREAU OF INDIAN AFFAIRS IN RESPONSE TO THE NOTICE OF AVAILABILITY AND ENVIRONMENTAL ASSESSMENT FOR THE PROPOSED SCOTTS VALLEY BAND OF POMO INDIANS MEGA CASINO AND TRIBAL HOUSING FEE-TO-TRUST PROJECT IN VALLEJO, CA (MEGA CASINO PROJECT); AND (2) RATIFY LETTERS OF CONCERN REGARDING THIS MEGA CASINO PROJECT TRANSMITTED ON JULY 24, 2024 BY SAN PABLO MAYOR PONCE TO UNITED STATES SENATORS ALEX PADILLA, AND LAPHONZA BUTLER, AND US CONGRESSIONAL REPRESENTATIVE ADAM SCHIFF; AND (3) OTHER RECOMMENDED POLICY CONSIDERATIONS BY THE CITY MANAGER
CEQA: This proposed action is not a project as defined by CEQA.
Label
CITY MANAGER RECOMMENDATION
Recommendation
Approve by Minute Order
Body
Compliance statements
FY 2023-25 Council Priority Workplan Compliance Statement
Under Major Policy Goal: Focus on Economic Development and Fiscal Diversification is an adopted policy contained in the FY 2023-25 Council Priority Workplan, effective May 1, 2023.
CEQA Compliance Statement
This is not a project as defined by CEQA
BACKGROUND
Since 1999, the City of San Pablo and Lytton Rancheria Band of Pomo Indians (Lytton Tribe), who owns and operates San Pablo Lytton Casino, mutually maintain a 25-year economic partnership under a current Municipal Services Agreement (MSA).
Under terms of the existing MSA, the City of San Pablo (City) receives annual San Pablo Lytton Casino revenues which represents nearly 65% of the City’s GF revenues annually, or approximately $33M for the FY 2024-25 period. This existing economic partnership between the City and Lytton Tribe funds critical municipal services to local residents, including but not limited to, the following local services: police and fire protection, emergency management services, building health and safety, youth and senior services, etc. Additionally, San Pablo Lytton Casino revenues received annually also sustain County-provided services such as: County Fire and EMS services, County Library Services and County Animal Control Services funded thru the City’s GF Budget annually.
In addition to providing critical funding for the City, the Lytton Tribe and the San Pablo Lytton Casino partnership is an important contributor to our local economy through creation of jobs and attraction of visitors who patronize our local commercial corridors, and contribute to our local economy. Each year, the Lytton Tribe’s generous annual contributions also benefit local seniors and non-profit community service organizations who provide our local residents with health care, services for the disabled, local youth programs, and more through the San Pablo Community Foundation Grant Program.
BIA Environmental Assessment (EA) - Scotts Valley Mega Casino Project
Recently, on July 8, 2024, the US Department of the Interior / Bureau of Indian Affairs (BIA), Pacific Regional Office issued an Environmental Assessment (EA) for the proposed Scotts Valley Casino and Tribal Housing Fee-to-Trust Project which initiated a 30-day public review period to analyze the potential impacts that could result from the development of a new, mega Casino gaming facility, including an eight-story casino with restaurants, bars, and a ballroom for events. In addition to a mega Casino project, the proposed project would also include the construction of 24 single-family residences, a tribal administration building, parking garage and a 45-acre biological preserve area on a 160-acre property located within and adjacent to the City of Vallejo, CA boundary in Solano County, near the intersection of Interstate 80 and Highway 37. The proposed mega Casino facility would be open 24 hours a day, 7 days a week. The public was invited by BIA Officials to analyze the potential environmental consequences of the Scotts Valley Band of Pomo Indians Casino and Tribal Housing Project, including any potential issues, concerns and alternatives that have not yet been raised during the BIA’s review of the proposal, which includes transferring a 160-acre property into federal trust status for the benefit of the Scotts Valley Tribe for gaming purposes.
After receiving feedback from the public on its EA, the BIA will decide whether to prepare an Environmental Impact Statement (EIS) to further analyze the effects of the proposed development or proceed on the basis of lesser environmental analysis. The federal actions necessary to implement the Proposed Project trigger the requirements of the National Environmental Policy Act (NEPA). For the EA, the BIA will serve as the Lead Agency for compliance with NEPA.
The Notice of Availability / Environmental Assessment (EA) for the proposed Scotts Valley Casino and Tribal Housing Project from the City of San Pablo, CA deadline for public comment is August 7, 2024, and recently extended to August 22, 2024 by BIA officials. For additional project information and 30-day public review period, please see attached link at: <https://www.scottsvalleycasinoea.com/>
Major Economic Threat
The EA document indicates that the proposed mega Casino project is located 16 miles away in the City of Vallejo, CA which initially represents a major economic threat to San Pablo Lytton Casino revenues which in turn has a detrimental economic impact to City revenues which funds local municipal services. Per the EA issued for the proposed mega Casino project, an Economic Analysis provided by the EA document projected an overall (-20%) reduction in annual San Pablo Lytton Casino revenues anticipated if the proposed mega Casino project is developed which translates into a potential $8-10M loss in revenues to the City’s GF Budget revenues annually.
Additionally, San Pablo is one of the lowest-income communities in the Bay Area and includes several tracts which are categorized as Disadvantaged Communities, according to U.S. Census. These are areas throughout California which suffer immensely from a combination of economic, health, and environmental burdens. By way of contrast, San Pablo’s median household income is significantly less (16%) than that of the City of Vallejo, CA.
Concerns over this mega Casino Project were discussed with Lytton Tribal representatives on July 16, 2024. Additionally, this emerging policy matter and the associated environmental and socio-economic impacts associated with the proposed mega Casino project in close proximity to the San Pablo Lytton Casino, and City of San Pablo were discussed between City staff and the City Council Casino / Tribe Ad-Hoc Subcommittee consisting of Mayor Ponce and Vice Mayor Cruz on July 17, 2024, and again on July 29, 2024.
BIA Official Comment Letter from City of San Pablo
Following internal review of the EA, the City prepared an official comment letter to BIA as required for the 30-day public review period which expires on August 7, 2024. Unfortunately, it was discovered, that certain public agencies which are in close proximity to this proposed project, and who are directly impacted by the proposed project, were not properly noticed of the EA document released by BIA on July 8, 2024. However, the City of San Pablo appreciated the opportunity to provide comments at this time given the limited timeframe provided by BIA officials.
City staff have identified numerous adverse environmental and economic impacts associated with the proposed mega Casino project. An official comment letter to BIA outlining the City’s concerns over the inadequacy of the EA with regard to the multitude of environmental and economic impacts associated with the proposed mega Casino project were addressed to BIA officials, and officially transmitted to BIA officials by Mayor Ponce on 07/22/24. Additionally, the City of San Pablo urged BIA officials to require the preparation of an appropriate Environmental Impact Statement (EIS) focused on the potentially significant impacts of the proposed project, including socio-economic conditions and environmental justice, land use, geological stability and wildfire hazards, public services and utilities, transportation and circulation, air quality, biological resources, and cultural resources. Copies of this City’s official comment letter was transmitted to the Lytton Rancheria Band of Pomo Indians, US Congressional Representative John Garamendi (D-8th District, State Assemblymember Buffy Wicks (D-14th District, including a copy to Contra Costa County Supervisor John Gioia, District #1. The City Manager’s Office is also coordinating our expressed concerns regionally through our lobbyist, Townsend Public Affairs to various external parties.
BIA Public Hearing on 07/23/24
Following transmittal of the BIA Comment letter on 07/22/24, City staff also attended and participated in a scheduled public hearing for the proposed mega Casino project held virtually by BIA officials on July 23, 2024. The City Manager expressed summarized the City’s concerns over the fast-tracking of any environmental review process without preparation of a full, comprehensive Environmental Impact Statement (EIS), and meaningful engagement process with all local stakeholders, members of the public, other Tribes and local communities impacted by this mega Casino project conducted by the Department of Interior and BIA officials as indicated in the City’s Comment Letter to BIA officials dated 07/22/24(See Attachment)
Meeting with Congressional Representative John Garamendi (D-8th District)
Through the City’s lobbyist, Townsend Public Affairs (TPA), Mayor Ponce, City Manager, City Attorney and City staff met with staff members on 07/23/24 from US Congressional Representative John Garamendi (D-8th District) to express our direct concerns over the mega Casino project being proposed in Vallejo, CA, and to highlight its close proximity to City of San Pablo and San Pablo Lytton Casino, and the need to adequately address the significant socio-economic and environmental impacts associated with the proposed mega Casino project under NEPA, located within US Congressional District #8 boundaries.
US Senator Letters from City of San Pablo
On July 24, 2024, following transmittal of the City’s BIA Comment Letter on 07/22/24, and providing public comments on 07/23/24 during the scheduled BIA public hearing on the mega Casino Project, the City transmitted letters expressing our grave concerns over the handling of the mega Casino project applications and NEPA environmental review process to date by the US Department of Interior and BIA officials to US Senator Alex Padilla, US Senator Laphonza Butler, and Congressman Adam Schiff in anticipation of his future ascent to a US Senate seat in California later this year (See Attachments). Subsequent follow-up meetings with our US Senate delegation are being coordinated by TPA.
City Manager Recommendation
Therefore, following transmittal of official letters by Mayor Ponce during July 2024 regarding our City’s grave concerns over the proposed NEPA environmental process for the proposed Scotts Valley Mega Casino and Tribal Housing Project in County of Solano, City of Vallejo, CA, the City Manager recommends the City Council consider the following actions for majority vote approval this evening via Minute Action vote, as follows:
1) Ratify approval of letter transmitted from Mayor Ponce to US Department of Interior / Bureau of Indian Affairs (BIA) transmitted on July 22, 2024; and
2) Ratify approval of letters transmitted from Mayor Ponce to US Senators Alex Padilla, Laphonza Butler, and US Congressional Representative Adam Schiff on July 24, 2024; and
3) Direct the City Manager and designated staff to work with the Casino/Tribe Ad-Hoc Subcommittee (Mayor Ponce; Vice Mayor Cruz) to draft an appropriate policy amendment for incorporation into the FY 2023-25 City Council Priority Workplan to include the following recommended policy items (a-d listed below) regarding the proposed Scotts Valley Mega Casino and Tribal Housing Project to be located in Vallejo, CA for formal discussion at the next regular meeting on September 3, 2024 as follows:
a. Continue efforts to support a full, comprehensive EIS to be conducted under NEPA by the US Department of Interior and BIA officials; and
b. Continue coordination with TPA regarding expressing the City’s major concerns to US Federal, State of California, Contra Costa County, and local elected officials in the East Bay region; and
c. Continue efforts to support the current City of San Pablo and Lytton Rancheria Band of Pomo Indians/San Pablo Lytton Casino ongoing 25-year economic partnership via the adopted Municipal Services Agreement (MSA) since 1999; and
d. Develop a future, formal opposition policy statement via Resolution for future consideration.
FISCAL IMPACT
Currently, there is no financial impact to the City at this time.
ATTACHMENTS
Att A - Official Comment Letter Transmitted on 07/22/24 from San Pablo Mayor Ponce to BIA Officials re: Comment letter on the Notice of Availability / Environmental Assessment for the Scotts Valley Casino and Tribal Housing Project from the City of San Pablo, CA
Att B - Letter Transmitted on 07/24/24 from San Pablo Mayor Ponce to US Senator Alex Padilla re: City’s Concerns over the Scotts Valley Mega Casino and Tribal Housing Project in Vallejo, CA
Att C - Letter Transmitted on 07/24/24 from San Pablo Mayor Ponce to US Senator Laphonza Butler re: City’s Concerns over the Scotts Valley Mega Casino and Tribal Housing Project in Vallejo, CA
Att D - Letter Transmitted on 07/24/24 from San Pablo Mayor Ponce to US Congressional Representative Adam Schiff re: City’s Concerns over the Scotts Valley Mega Casino and Tribal Housing Project in Vallejo, CA