The Nisqually Indian Tribe has agreed to pay Lakewood nearly $19,000 a year for city services to its proposed convenience store and gas station.
The 20-year agreement ensures the city will not lose tax revenue even though the property is off-reservation trust land that is not subject to property and sales taxes.
It also makes clear the tribe will not build a casino on the property it acquired on the 11700 block of Pacific Highway.
The City Council approved the agreement with a unanimous vote Monday night. Council members asked some brief questions but there was no discussion prior to the vote.
The tribal council signed off on it Sept. 18.
Richard Rinehart, chief executive of the Nisqually Board of Economic Development, said after the vote he was satisfied with the agreement and that construction would as soon as it secured a building permit. Community Development Director David Bugher said the city would issue the permits today.
Rinehart said the tribe may be interested in acquiring more property in Lakewood in the future.
In May, the tribe paid more than $900,000 for a 0.71-acre parcel of land that houses an abandoned gas station in Lakewood. The tribe intends to open a new gas station and convenience store as part of their ongoing economic expansion efforts.
The Bureau of Indian Affairs has preliminarily approved a “land-to-trust” acquisition of the parcel. This means the federal government would own the land but give control of the property to the tribe.
According to a letter from the federal bureau, the tribe estimates annual sales at the gas station and convenience store will be more than $14.5 million, with more than $12 million coming directly from gas and cigarette sales. The tribe also plans to make $1 million to $2 million in improvements on the property.
The tribe committed to pay the city a total of $18,000 annually for police and fire protection and $754 a year for collection of stormwater.
Without the agreement, the tribe wasn’t required to pay taxes, but the city also wasn’t on the hook to provide public services to the enterprise.
The agreement states the tribe “will not be developing this or any property as a gambling establishment in the City as such is contrary to the City’s long term vision for South Tacoma Way.”
The agreement does have teeth. The tribe waived its immunity to sue or be sued because it’s a sovereign government. As a result, either the city or tribe could sue the other party solely due to a violation of the agreement.
In recent years, the tribe has made in-roads to expand its economy beyond its gambling establishment, the Red Wind Casino, located outside of Yelm. The tribe announced last week it joined with a Bellevue developer to buy more than 200 acres in Lacey and restart efforts to develop it into a mixed-use center. It’s started its own diving business and construction company.
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