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Poker room to grow, city to profit

Poker room to grow, city to profit

The Turlock Poker Room and Turlock City Council came to a new development agreement that allows for expansion of gaming tables.


POSTED December 11, 2009 10:57 p.m.
The Turlock Poker Room will grow from 10 to 14 tables, following the acceptance of a new development agreement with the city.
The City of Turlock will receive 1 percent of gross revenues during the first year, 2 percent of gross revenues in the second year, and 3 percent of gross revenues for the third year through the 25th year, when the agreement expires. The city will also receive an additional six-tenths of a percent for each table after the 12th in operation at the Turlock Poker Room, up to a maximum fee of 7.5 percent of gross revenue.
In exchange, the Turlock Poker Room will receive exclusive rights to operate a card room in the City of Turlock and the aforementioned right to expand to 14 tables.
The agreement has been in the works for three years, stretching back to previous City Manager Tim Kerr and City Attorney Dick Burton’s leadership, but at Tuesday’s council meeting a bit of final haggling over the deal was required.
As drafted, the agreement would have required the six-tenths per table bonus for each table after the 10th. The Turlock Poker Room advocated for the shift to 12, so as to better survive the current down economy and to not see quite as large a hit to their gross revenues.
Vice Mayor Ted Howze suggested a three year deferral of all fees under the agreement as an option, but Poker Room representatives remained adamant that their business projections would only work with the cutoff point set at table 12. They noted that the state already has a moratorium on new card rooms until 2015, which is likely to be extended, reducing the importance of the exclusivity agreement.
“Let’s be clear: you guys are poker players,” Howze said. “I feel like you have a hole card here.”
Howze also expressed displeasure that the agreement change would result in Turlock receiving 1.2 percent less each year, at least until the state authorizes an expansion in table count that would allow Turlock to hit the 7.5 percent cap under the agreement.
Ultimately, however, all councilmembers approved the agreement with the cutoff point at 12 tables, expressing their appreciation for the 113 jobs the Turlock Poker Room provides and their displeasure with the length of time it had taken to reach a development agreement.
The City of Turlock will start receiving revenues from the new agreement within 60 to 90 days.

Carnegie out to bid, city cracks down on cost overruns
The oft-delayed Carnegie Arts Center reconstruction is back in motion as, on Tuesday, the council authorized City Engineer Mike Pitcock to advertise bids for the construction of the expanded center.
Fifteen bids were previously received for the project on June 18, with Applegate Johnston of Modesto as the apparent low bidder at $5.3 million. City staff received four complaints regarding that bid, suggesting it was not completed in accordance with certain aspects of the labor code, and council subsequently rejected all bids on Aug. 25.
Tuesday’s motion calls for bids to be advertised only once design documents are 100 percent complete and the building permit has been issued. Staff anticipates the building permit will be issued this month. Once bids are received, the project will come back before the council for acceptance.
In conjunction with the Carnegie rebuild, the council took the opportunity to examine their project bidding process. In efforts to reduce cost overruns on future projects, all future bid advertisements will occur only for completely designed projects. Also, all capital projects greater than $1 million in value will come before the City Council for bid authorization, and any change order requests greater than 5 percent of contract value or $100,000 will require approval of an ad-hoc council subcommittee.

New Planning commissioner named
Alex Salcedo, a current Planning Commission alternate, will take the seat vacated by Planning Commissioner Aben Williams in July. Williams had served as commissioner and as alternate from 2007 to 2009 before a new job abruptly forced his move to Oregon before the July Commission meeting.
Williams has since returned to Turlock, however, accepting another new post back in Stanislaus County. Williams will take the seat vacated by Salcedo’s promotion, and will serve as planning commission alternate.
Vice Mayor Ted Howze and Councilman Kurt Spycher voted against Salcedo’s appointment. During the Nov. 10 council meeting, Howze took issue with Mayor John Lazar’s motion to appoint someone other than Williams to the vacant seat, as Williams still has time remaining on his initial term.
The council also reappointed Planning Commissioner Nick Hackler and Planning Commission Alternate Victor Pedroza whose terms were set to expire.

New program to ease payment of impact fees
In an effort to help encourage construction in this down economy, the City Council unanimously approved Turlock’s participation in the Statewide Community Infrastructure Program on Tuesday.
The SCIP program, created in 2002, allows the financing of development impact fees that would normally be due upon receipt of development entitlements or building permits. SCIP also allows for the direct financing of public capital improvements.
Under the program, the California Statewide Communities Development Authority, a joint powers authority sponsored by the League of California Cities and the California State Association of Counties, issues low-cost, long-term, tax-exempt bonds to finance the improvements. Participating landowners are then responsible for a special assessment, but are allowed to pay off the assessments at any time.
Participation in the program is entirely optional for developers.

Change in fire sprinkler laws could be looming
The Turlock City Council took the first steps in reviewing their fire sprinkler policy on Tuesday, offering suggestions to expand the minimum size of building required to install sprinklers.
Current city code requires fire sprinklers in any residential building 4,000 sq. ft. or larger. City staff has encountered a problem where individuals would like to expand their residence above that threshold — usually by adding a covered patio, which would increase the square footage under the fire code — forcing the costly installation of sprinklers.
The council suggested that the City of Turlock return the sprinkler threshold for all buildings to 5,000 sq. ft., the approved size before a December 2007 reduction and the current threshold for Modesto and Stanislaus County. They also suggested a grandfather clause for residential properties that do not currently include sprinklers, and a special allowance for patio installations.
Fire Chief Mark Langley will return to the council with possible ordinance changes.

City to welcome new employee
Despite a hiring freeze, the Turlock City Council approved hiring one new regular full-time Public Safety Emergency Services Dispatcher II, to serve the Turlock Police Department, Fire Department, and Public Works staff. Turlock also provides dispatching services for the City of Gustine, which generates $100,000 in annual income.
The dispatcher position had been budgeted in the Turlock 2009-2010 budget, but the existing dispatcher tendered his resignation on Nov. 14 to seek new employment opportunities in Arizona. The City of Turlock will employ 15 dispatchers following the new hire, or one less than the city employed last year.

Turlock to fight state theft of local funds
The Turlock City Council unanimously voiced their support for the Taxpayer, Public Safety, and Transportation Act of 2010, a proposed constitutional amendment that would prohibit the State of California from raiding local government, transit, and transportation funds.
The most recent state budget borrows and takes approximately $5 billion from cities, counties, transit authorities, redevelopment agencies, and special districts around California. The act to prevent future taking is scheduled to appear on the November 2010 statewide ballot.
To contact Alex Cantatore, e-mail acantatore@turlockjournal.com or call 634-9141 ext. 2005.

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