Nooksack tribal chairman tells members its Deming casino could close

The Nooksack River Casino is located near Mount Baker Highway in Deming.
The Nooksack River Casino is located near Mount Baker Highway in Deming. The Bellingham Herald

This week, Nooksack Indian Tribal Chairman Bob Kelly called the first public meeting in roughly three years to inform members of the possible closing of the Nooksack River Casino.

The casino was renovated using about $15 million in loans that the Nooksack Business Corporation, an entity owned by the tribe, made payments on for only a year before going into default.

The legal process between banks and the tribal entity has gone on since early 2011, partly due to questions of whether local courts had jurisdiction over the case.

Whatcom County Superior Court Judge Deborra Garrett ruled on May 7 that Outsource Services Management, a loan servicing company, could collect nearly $20.1 million on the loan and fees, to increase by more than $3,500 in unpaid interest per day.

During a community meeting Tuesday night, June 16, Kelly told tribal members that the casino could close depending on which assets the court ruled Outsource could collect on, said Michelle Roberts, a Nooksack tribal member and one of roughly 300 people potentially facing disenrollment from the tribe.

“The next court date is on Friday, that’s to determine whether or not the banks can take everything in the building,” Roberts said Wednesday morning. “That would force them to close. If they don’t, the (tribal) council will decide whether to close it or not.”

During a court hearing Friday afternoon, June 19, Garrett gave a verbal ruling that Outsource could collect on enterprise accounts and revenues of all commercial activities on the premises that were funded by the loan, but she did not rule what counted as a fixture or equipment subject to the terms of the loan agreement.

Additionally, the judge said she would take a week or two to re-read the agreement and send an opinion to both sides about whether Outsource had a right to collect on certain funds used to operate the casino. Arguments from both sides centered on whether the Indian Gaming Regulatory Act allows for a non-tribal lender to collect such money.

In court documents, the tribe has alleged that even without making payments on the 2006 loan since 2010, the casino had operated at a loss and is at least $2 million in the hole, aside from the loan.

Lawyer Connie Sue Martin, representing the tribal corporation, told a reporter afterward that she had no information on what the tribe intended to do with the casino.

“The community has been informed of the situation,” Martin said.

Lawyer Jerome Miranowski, representing Outsource, said the company would try to collect on its judgment in a reasonable way.

“We don’t want to affect the operations of the casino,” Miranowski said. “It’s in our interest for the casino to continue operations.”

Reach Samantha Wohlfeil at 360-715-2274 or samantha.wohlfeil@bellinghamherald.com.