Tribal Council Fight Leads to $14 Million Buyout of Snoqualmie Casino CEO
Inner conflict among the Snoqualmie tribal council triggered the unexpected $14 million buyout of its casino CEO’s employment contract, generating outrage among some tribal members, reported The Seattle Times.
The February 13 vote might have been sparked by issues that Matt Mattson, tribal administrator, told the Times lingered over hostility about the firing of some tribal casino employees over the years, and dissatisfaction with the casino’s initial underperformance during the recession.
The decision surprised many members, because two months prior on Dec. 14 the council had voted to retain Snoqualmie Casino CEO Mike Barozzi to provide stability, according to the Times. The veteran casino manager had served as an essential part of the tribe’s pitch to investors, stated SnoValleyStar.com, helping them pull in $330 million in financing for the Washington casino’s construction and opening in 2007, reported the Times.
"We regard Michael Barozzi, our chief executive officer, as highly important to the success of Casino Snoqualmie. The loss of Mr. Barozzi's services for any reason could adversely affect us," the tribal council warned potential investors in its offering memorandum, according to the Times.
Barozzi’s buyout could raise the tribe’s interest rate when it refinances the casino’s debt, reported the Star. The bonds mature in 2013 and 2014, and the entire $330 million debt comes due at that time, stated the Times.
The 4-3 decision to purchase Barozzi’s contract was settled at an amount lower than the $19.5 million he had requested, reported the Star.
According to Mattson’s email to the Times, Barozzi “said basically that the tribe was ungrateful for what he has done to develop the operation, bring the operation up through the worst economy in 80 years and that he felt the nonsense and false allegations would never stop….”
The payment is considered an expense of casino operations, paid out of casino revenues, stated the Times. Following the vote some tribal members filed an emergency injunction in tribal court in attempt to block the payment. They claim the council must request approval from the general membership before spending an excess of $2 million, stated the Star.
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