The Fon du Lac Band has served notice to the City of Duluth it will stop cash payments instituted as part of the creation of the Fond dul Luth casino. If the band gets its way, the city stands to lose millions of dollars in revenue each year. The band sent a letter notifying the city of its intentions. However, the city says that document didn't give a specific reason as to why the band is pulling the money. If the tribe does not take back its action, city officials say they will file for a court injunction in an effort to uphold its contract with the Band.Officials say the Fond du Lac band shells out approximately $1.5 million in casino profits to the city each quarter. Now the tribe is cutting all casino payments."The city strenuously disagrees with this interpretation of the agreements," said David Montgomery of the City of Duluth.
This isn't the first time the tribe has made this kind of move. In 1989, the city says the band declared agreements that were existing then, invalid. In that case, officials say the federal court system dismissed the band's lawsuit and said the matter goes to the National Indian Gaming Commission.Officials say the outcome resulted in the money-sharing agreement that is in effect today. Fond du Lac Chairwoman Karen Diver couldn't be reached for comment Monday. But in an interview last year, she questioned the money-sharing agreement."We have about a $9 million payroll in the City of Duluth and for a business that's operating in Duluth, I'm not sure many businesses would tolerate that level of taxation," Diver said last year.
At stake is the city's street improvement program, which uses casino money."We have every expectation that the basis of the contract will remain--those revenues will continue to come to the City of Duluth to fund our street program," said Mayor Don Ness of the City of Duluth.
The city says the casino agreement that exists today remains in effect through 2036.The city has filed a notice of breech under contract. That gives the Fond du lac band 30 days to retract their position. If that doesn't happen the city says it will file for a court injunction.
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