The Jamul Indian Village Development Corporation (JIVDC) has revealed in a press release from yesterday that the company plans to rebrand to Jamul Casino and introduce a new management team at the Hollywood Casino Jamul-San Diego. The news came shortly after Penn National Gaming Inc. announced its decision to terminate investment and management deal with the highly-controversial tribal-owned casino. The piling heaps of news revealed that the Jamul tribe failed to meet its loan legal obligation, which fueled Penn’s decision to withdraw its investment in the casino.
According to the press release, the two companies “mutually agreed” on terminating their partnership. JIVDC explained that the transition is the right decision for the company and its further development as a financially independent business entity. The two companies will officially discontinue their partnership on 28th May this year. Erica Pinto, tribal chairwoman commented that the employees are also aware of the situation and the company has already started to look for a new general manager to oversee operations.
Penn’s decision to part ways with Hollywood Casino Jamul-San Diego was provoked by the revelation that the Jamul tribe defaulted a $48.5 million impairment charge on the company’s loan. The SEC note stated that JIVDC’s financial commitments to future funds are estimated to be around $29 million by the end of the last year.
According to documents filed on 28th February with the U.S. Securities and Exchange Commission (SEC), the Jamul Indian Village Development Corporation have unpaid debts with SEC and now the loan is back to haunt the company. SEC elaborated that San Diego Gaming Ventures had previously made a $98 million loan to Jamul Indian Village. The money was used to cover construction and operating expenses.
Tribal Casino Project Triggers Avalanche of Discontent
Pennsylvania-based casino operator Penn National Gaming has expanded its footprint across the United States by financially supporting a number of gambling venues including five in Mississippi and four in Illinois. It is interesting to mention that the company managed to strike out beyond familiar family turf and enter the Canadian gaming market. Hollywood Casino Jamul-San Diego was Penn’s only exposure in California.
Financially backed up by Penn National, the Jamul Indian Village officially opened to crowds in October 2016. The $360-million gambling venue has created avalanche of discontent among the residents of the neighboring areas, who brought the case to court. In fact, the casino project was legally challenged on multiple occasions.
Casino opponents argued that the construction of a gambling property is an ecological gamble as the construction work will destroy the landscape of the area. Others announced that the developers are not allowed to build a casino property on that particular plot of land, as it does not belong to the tribe. Two one-time members of the tribe even claimed that the mortal remains of their forefathers were desecrated by developers.