Been to the Harrah’s Cherokee Casino? Even if you don’t gamble, I’d encourage a walk through. My bet is you’d be absolutely astounded at what is happening in Cherokee.

I took a media tour a couple of weeks ago and, honestly, couldn’t believe what I saw. The reality that there is something that huge, that glitzy and that busy juxtaposed so near secluded mountains, vast wilderness areas and all of our very quaint, very small downtowns at first take seems a little odd.

What’s not odd, though, is how Harrah’s has changed the fortunes of the tribe — and the region — for the better. In fact, as this recession lingers, it’s painful to imagine how Cherokee, Swain and Jackson counties would be faring without the casino revenue.

The casino, in what is admittedly an understatement, has blossomed. It now employs more than 2,000, and that will go up to 2,400 once the current expansion project is done. It attracts about 3.6 million gamers annually, making it the state’s largest tourist attraction.

And now the Eastern Band of Cherokee Indians wants approval, to use a poker term, to go all in: it wants dealers instead of video machines, a move that it estimates would add at least another 400 jobs. Along with those dealers, say gambling industry insiders, would come tens of thousands of more patrons.

The governor and the tribe are both playing hardball in the dealer negotiations, and reportedly the two are not very close to a deal. The state wants an agreement with the tribe for a percentage of casino revenue for its coffers before allowing dealers. While we agree that the state should gets its fair share, we also hope state leaders take into account what Harrah’s provides for a region that has little industry, few large corporations, and traditionally doesn’t get the attention that is lavished on the coast or the urban centers in the Piedmont. I suspect every leader in this part of the state wants the casino to continue to prosper.

Here’s what leaders in Raleigh need to understand: the casino is the right kind of tourist attraction for the mountain region. It doesn’t pollute like a traditional factory (and thereby spoil the attraction of the mountains), doesn’t add to urban sprawl, doesn’t strain infrastructure, and its patrons come for a few days, spend their money and leave.

The state spends millions on tax breaks to attract jobs in other parts of the state, and yet it could shackle the next planned casino expansion because it wants more revenue than the tribe has so far been willing to relinquish.

It’s been more than a decade since the state let the genie out of the bottle when it comes to gambling. Not only did leaders roll out the welcome mat for the casino, it has since set up a lottery. So there’s no moral or ethical argument for delaying approval of the tribe’s attempt to win approval for dealers. It’s all about the money.

The governor, state leaders and the tribe need to get a deal done so Western North Carolina’s lead economic engine can reach its full potential.

(Scott McLeod can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..)

When a new federal law in the 1990s opened the door for Indian tribes to build casinos, it set the stage for economically-depressed reservations to become masters of their own destiny, to create wealth where none existed before and improve the quality of life for their people.

“Some have and some haven’t,” said Darold Londo, general manager of Harrah’s Cherokee. “Cherokee was willing and able to make tough decisions that didn’t come easily within the tribe. They were wise and courageous to have done what they did.”

While the casino appears from the outside to be a shining beacon of money, launching the enterprise took more than flipping on an “open” sign and watching the money roll in.

“It took a lot of smart, difficult work with a lot of people in the tribe and Harrah’s to market this operation,” Londo said. “It blew the expectations of the tribe and Harrah’s away. It was more successful than people had ever expected.”

A decade later, Cherokee found itself once again at a crossroads. Since the casino first opened in 1997, there had been growth spurts followed by plateaus.

“We knew there was another plateau coming,” said Principle Chief Michell Hicks said. “At some point, like any product, it gets stale. The customer loses interest. If you don’t keep it fresh there is a risk of losing the customer base.”

The risk of doing nothing — of watching the casino grow old and tired — seemed much worse than the leap of faith by the tribe to go for another expansion.

“It is making sure the casino stays ahead of the customer wants and needs but also make sure we can push the profit level as high as we can possibly can,” Hicks said.

The tribe embarked on a massive $633 million expansion in 2007 to remake the casino and hotel into a luxury resort.

Since then, however, the recession has taken its toll on casino profits. Revenue fell for three consecutive years following a high in 2007. Cherokee was not alone. The trend was industry-wide.

But the decline led many in the tribe to question whether the massive expansion was ill-conceived.

The outlook is improving. Profits are up 10 percent for the first six months of the year over the same six months last year. It’s a sign perhaps not so much of a better economy, but that pieces of the expansion coming on line: the third hotel tower is humming, the concert venue is in full-swing, new restaurants are opening every few months.

Was it worth it?

A big question still looms in the minds of tribal members: was the expansion worth it? It came at a cost — $633 million to be exact. And now the tribe must pay off that debt using its cut of casino profits.

The expansion must reap enough new business to justify the cost — otherwise it could hurt the tribe’s bottom line instead of help, the massive debt eating away at profits.

But that seems unlikely.

“Any business decision you will look back and say ‘should we have done it, should we have not,’” Hicks said.

But for Hicks, he still believes it was the right move, particularly given the bargain interest rates the tribe could get.

As for the recession, however, Hicks admits the timing wasn’t ideal.

“With regards to the economy it didn’t match up as well,” Hicks said.

Cherokee is smart for remaking the casino into a resort, according to Vin Narayanan, a national casino industry expert and managing editor of Casino City Press.

Had Cherokee remained static and not pushed for a massive expansion, its outlook five years from now would not be good. The casinos faring poorly right now are those offering little to guests other than a gaming floor lined with slot machines.

But resort-style casinos, with onsite hotels, shopping and dining: “that has been a proven formula for success,” Narayanan said.

Cherokee had been somewhere in between: not a simple slot-parlor, but not a full-fledged resort either. The new resort amenities will not only attract new guests, but also younger guests.

It will also diversify their revenue stream. Less than a decade ago, 80 to 85 percent of revenue for Vegas casinos came from the gambling side.

“Now it is almost 50-50. Almost half their revenue is coming from dining, hotels, the shopping, that whole thing,” Narayanan said. “It is not just about gaming.”

Cherokee’s casino competition doesn’t just come from Atlantic City, the Gulf Coast or Vegas. It is competing against cruise lines and Disney World — the whole sphere of entertainment dollars.

At least revenues are climbing again now. If not for the expansion, they could be flat or still dropping.

Londo predicts the Cherokee casino won’t get back to past profit levels until 2012 — three years ahead of the rest of the industry.

“In the industry they are not projecting a return to those types of levels until 2015. That is a testament to the capital investment in this property that we’ll return much sooner to previous levels,” Londo said.

Hicks points out that 2010 would in fact have held steady from 2009 if not for three bad months in the winter, when Cherokee was surrounded on three sides by landslides blocking the way to Western North Carolina. Rockslides shut down Interstate 40, U.S. 64 and U.S. 441, essentially blocking all routes to Cherokee from points west.

“We had some variables there we couldn’t control,” Hicks said.

Protect the monopoly

While the economy has tempered the tribe’s hopes for the expansion, things could be much worse: gambling could be legalized in North Carolina or a surrounding state.

That should be the tribe’s biggest fear, according to Narayanan.

“States are in a world of hurt from a revenue standpoint,” Narayanan said. “If the North Carolina budget becomes bad enough, they might bring in an industry that is willing to get taxed at a ridiculously high rate. A few hundred million in revenue starts to look pretty good.”

That’s exactly what’s happened in some New England states, putting a major dent in Atlantic City’s monopoly, and thus its profits.

“It is like McDonald’s and Burger King, there is a finite amount of fast food revenue that the industry is competing for,” Narayanan said.

Closer to home, the state of Ohio sanctioned four casinos in the throes of recession budget woes. Each will rival the number of games offered at Cherokee, and two are resort-style casinos carrying a construction price tag of close to $1 billion.

As the only game in town, Cherokee has a clear advantage. The next closest casino is a day’s drive any way you slice it: the Mississippi River, the Gulf Coast, Atlantic City, or the many casinos run by northern and mid-western Indian tribes, from Oklahoma to Iowa.

But that advantage only goes so far. The rest has taken the blood, sweat and tears of an entire tribe to realize.

“The thought that we aren’t in a competitive market based on our geography is a false perception,” said Londo, general manager of Harrah’s Cherokee. “There is a percentage of gamers that are relatively promiscuous. They will travel to the right environment for them. In some cases, it is just as easy to hop on a plane. Nobody has the lock on that business, even if they have a geographic advantage.”

The lack of competition can even be a turn-off. Some gamers like the action of casino-hopping.

“Some people if they are going to make an effort to game they want options and choices,” Londo said.

Cherokee’s sprawling casino expansion does its best to make up for that.

“Here we were very deliberate in creating zones, so it had a different look and feel because people do want that change in scenery,” Londo said. Different lighting, different music, a different mood — and different luck.

The marriage between the tribe and Harrah’s has been a happy one. Harrah’s brings the expertise and know-how to running a casino. The tribe benefits from its name recognition and cross-marketing of other casinos.

In return, it gets a management fee, based on a percentage of the profits.

“As we’ve grown in our capabilities, Harrah’s has learned as much from us as we learn from them,” said Erik Sneed, construction oversight liaison for the expansion. “We’ve been very smart in the way we do our business to stay ahead of the curve.”

Ultimately, Harrah’s is a corporation, while the tribe is beholden to social, cultural and civic goals. Their goals aren’t mutually-exclusive, but there are differences, Londo said.

“What you will find inherent for tribes is they want to prevail over a longer period of time, whereas companies beholden to Wall Street want to focus on short-term results,” Londo said.

Cherokee is more interested in ensuring revenues will still be strong five years from now and less concerned about the current state of business affairs, Londo said. And the tribe also wants to provide jobs for tribal members and see them promoted in the company.

In the trenches

When 46-year-old Londo took the helm at Harrah’s Cherokee in 2006, the tribe was eyeing an expansion in the neighborhood of $400 million.

Not big enough, Londo thought. He believed Cherokee had more market potential than that. It meant “going bigger, and a lot bigger in some cases,” Londo said.

But there’s a fine line.

“Nobody wants to be in a facility that feels empty, that lacks excitement and enthusiasm,” Londo said. “If you were going to err you would err on the side of being just a little smaller than a little too big. It feels energetic.”

Londo has Ojibwa ancestry, though he didn’t grow up on a reservation. His parents ran a restaurant in Milwaukee. His first memory is as a five-year-old boy, filling an ice chest in Londo’s Lounge.

He went to West Point, and became a captain in the military, flying Cobra attack helicopters and then training other pilots. He got his MBA on the side, then quit the service and went to law school. After working 10 years in the field of business law, he landed a job with Harrah’s in Atlantic City 2002 and rapidly rose through the ranks.

Londo is cool and calm by nature, to be expected from his West Point education and military training. He exudes the virtue of self-discipline.

The expansion on the horizon was a major drawing card for Londo to leave Atlantic City and move to comparatively rural Western North Carolina.

Londo lives in Sylva with his wife and three kids, ages 12, 16 and 17. As far as the family is concerned, it stacks up to their past life just fine.

“My wife probably enjoys it the most. She says if you have a Wal-Mart and a Lowe’s you are good-to-go,” Londo said.

“I would have been a lot less excited to come here if Cherokee wasn’t on the eve of exploiting its growth potential,” Londo said.

Londo instantly immersed himself in the master planning for the expansion.

No decision seemed to small for Londo to weigh in on. Where should valet parking drop-off be? How many seats should the buffet have, or the concert venue? Which would be better, a new Italian restaurant or a steak house? As for retail, a ladies footwear shop or consumer electronics?

A master planning committee of the casino’s top management and architects had their own “situation room” dedicated to the expansion, where such details were hashed out.

“There was a time when I was in design, construction and right-sizing type meetings three-and-a-half days a week,” Londo said.

But it was his forté and he loved it.

“The military trains you to plan, plan, plan. Planning is important,” Londo said.

When the tribe set its sights on a major expansion of the casino, one of the first steps was a critical casino-hopping tour in Atlantic City to check out the competition. Far from a sightseeing junket, however, the team had a rigorous itinerary, visiting several casinos a day with notepads in hand.

Those on the trip each had their own take-away goals. Rather than honing in on the price points for buffet menus, Sneed was on a big-picture quest.

“For me, it was about the quality of the experience. How do you design a space that is beautiful and fabulous but is still functional?” Sneed asked.

He also wondered how amenities were integrated into the gaming floor. Restaurants and shops were one thing the casino lacked, and in addition to sheer square-foot expansion of the gaming floor, the amenities would be a major focus of construction.

How are drink windows tucked in to the gaming floor? How close does the food court come to the tables?

The master plan team didn’t close the books once ground was broken. They were constantly refining.

“That blueprint or playbook that you established isn’t set in stone, so as conditions change you can adapt to it,” Londo said.

Most notably, the advent of alcohol. Talk about a game changer. The casino was dry — like the rest of the reservation — until just last year. Plans were rapidly redrawn to include bars and walk-up drink windows on the gaming floor.

The recession also led the casino to scale back the square-footage for the spa.

The expansion is taking the casino from 1,600 to 2,400 employees. Londo makes an hour each week to drop in on the new hire training sessions — averaging about 30 new hires a week right now.

“How are we expanding when the rest of the economy is contracting?” Londo asked after hitting the highlights of the expansion. “It’s magic. We can’t figure it out either.”

Cherokee is consistently a top performer out of 17 Harrah’s casinos in the country. Once a week, the general managers from every Harrah’s hold a conference call to compare numbers.

Likewise, Londo reports to his boss at Harrah’s corporate headquarters almost daily. Londo has goals to meet — not just for the year, but every month and every weekend. Every Monday, his boss wants to know: how was weekend performance? Did you meet your goals? Did the promotions do as well as expected?

“If not, what do we do about it?” Londo said. “That’s how myopic we get.”

It’s hard to gauge just how high the bar should be for Cherokee. Harrah’s expects growth from one year to the next, but setting revenue goals has been complicated by the economy, with even the most well-versed industry experts flummoxed over how much of a hit casinos could expect in the recession.

But in Cherokee, it’s been doubly complicated. Will new revenue from the expansion off-set the recession? Or for that matter, finally introducing alcohol?

Londo flipped an imaginary coin in the air with his thumb when asked how Harrah’s even begins to set profit expectations for a property in such flux. But he quickly donned his business demeanor and returned to casino-speak.

But Londo’s remaining time in Cherokee is probably short. With the expansion due for completion next year, Londo is looking for that next move.

To hear many Cherokee leaders on the eve of last week’s tribal elections, the tribe is incredibly close to striking an agreement with Gov. Beverly Perdue that would allow live dealers at the casino, perhaps within weeks.

Two letters from the governor’s office to the tribe in August indicate the truth is murkier than the political message, however.

In return for those live dealers Cherokee maintains would lead to a surge in gaming dollars, North Carolina wants a slice — perhaps more accurately described as a chunk — of the casino-revenue pie.

Exact dollar amounts aren’t detailed. But reading between the lines of a politely worded argument between the tribe’s attorney general and general counsel for the governor, the two parties are clearly at odds over exactly how much the cash-poor state can realistically expect to squeeze out of the Eastern Band of Cherokee Indians.

“They are not close,” said Perdue’s spokesperson, Chris Mackey, when asked Tuesday how near negotiations are to finalizing between the tribe and Perdue.

The state, under federal law, can’t tax casino profits or sales taxes on casino purchases, because the tribe enjoys sovereignty. The state can, however, demand a percentage of gaming revenue in exchange for giving the tribe gambling privileges.

The state initially wanted the tribe to give up a share of all revenue from the entire resort: the existing gaming machines, the new table games, along with hotel, restaurants, spa, concert revenue, retail shops, you name it.

That tack was sidelined, however, by the Department of Interior, which ultimately has to approve any “revenue sharing” arrangement between the state and the tribe. Oversight by the federal agency attempts limit what states demand of tribes to a reasonable amount.

But there’s the rub: What’s reasonable? While the state was forced to back off demands for a cut of all resort revenue, the sides are still at odds over what’s on the table: all gaming revenue, including existing gaming machines, or only revenue from newly introduced table games with live dealers. Another option being debated is a direct, flat payment to the state each year rather than a percentage based cut.

Negotiations with former Gov. Mike Easley several years ago reached an impasse, but were rekindled with Perdue this year. Easley had demanded too great a share of revenue, and neither side was willing to budge.

The tribe can’t play hardball forever, however. Getting live dealers at the casino is critical to the tribe’s financial wellbeing: The Eastern Band has a $633-million expansion to pay for at a time when the recession has taken a toll on casino business.

“If they don’t get table games it is hard to see any of this succeeding,” said Vin Narayanan, Managing Editor of Casino City Press in Atlantic City and an expert on the industry. “That is the first thing.”

The casino can’t diversify its audience, or attract a younger generation of gamblers, without table games and live dealers, according to Narayanan.

“Young players play table games. Young players don’t play the slots,” Narayanan said. “Casinos know they have an aging demographic that is attracted to the slots. If you have 4,000 seats of all slots your demographic isn’t going to get any younger.”

Action in Raleigh next week

If the tribe can reach an agreement with the Democratic governor — which state Sen. Tom Apodaca, R-Henderson County, sympathetically described as akin to hitting a rapidly moving target — the Eastern Band does appear to have the votes necessary for passage in the General Assembly, Apodaca said.

The General Assembly is expected Sept. 12 to signoff on allowing the tribe and Gov. Perdue to renegotiate a gaming compact that would allow live dealers. Perdue noted in the proposed legislation that she “desires to amend the compact,” provided the tribe and state can reach an actual agreement.

Despite the blessings of the General Assembly anticipated next week, the letters from the state reveal the critical agreement with the governor might not be easily won anytime soon, however. Cherokee hasn’t exactly gotten the cart before the horse, but this horse sure is proving difficult to saddle and ride.

While the state clamors for a cut of gaming revenue, the tribe has a wish list of its own that includes more than live dealers. The tribe also wants the state to guarantee its gambling monopoly — a promise not to allow any other casinos anywhere in the state for the 30-year duration of the gaming compact, or until 2041.

The state doesn’t appear willing to go that far.

“We believe the area of exclusivity should be focused on Western North Carolina, recognizing that this protects the tribe from an encroaching competitor while at the same time it avoids binding the hands of future governors and legislatures,” read one of the letters from the governor’s office.

In earlier negotiations that allowed the tribe’s existing casino operation, the tribe was made to give up some of its gaming revenues (at least $5 million a year) for the good of the region. The Cherokee Preservation Foundation was formed to award grants to worthy economic development or cultural initiatives across the mountains, not just on the reservation. The state is willing to reduce the amount the tribe has to funnel to the Cherokee Preservation Foundation if that’s what it takes for the state to get the cut it wants for itself.

Ultimately, the negotiations between the tribe and the state are playing out like the ultimate poker game. A cash-strapped state that’s eager to claim a cut of casino revenue; a debt-burdened tribe that needs live dealers. Only time will tell who has the better hand.

A chandelier over a high-limit gaming table at Harrah’s Cherokee Casino costs $150,000, more than the median selling price of homes in Western North Carolina last year.

Like all the luxury touches found in the casino, it was custom designed. Carpets weren’t picked from swatches. And you won’t find the light fixtures in a catalogue. A team of interior designers invented everything from scratch and had them manufactured to order.

They exude class. On average, the casino’s interior finishes cost $250 a square foot. The tile mosaics on giant columns are real slate. Any paneling is real wood.

“They didn’t skimp on quality at all. When people come in here and play, they look at finishes. They look at décor. If it looks cheap their perception is going to be this was just thrown together,” said Matt Pegg, executive director of the Cherokee Chamber of Commerce.

But in some spaces, such as the posh Asian gaming room — boasting a traditional moon gate over the entrance, thought to bring wealth to those who pass through it — interiors ran as much as $600 a square foot.

If dropped in to Harrah’s blindfolded, the glitz and glam could easily place you in Vegas. But behind the veil, the subtle influence of color and design leave no doubt this casino is in Indian Country.

“In the beginning, we created a story, what I call the backbone, of the entire casino,” said Michelle Espeland, the lead interior designer.

Native American themes had to be present, but not “in your face,” Espeland said. “It has derivatives of Native American influence, but not over the top.”

Cherokee art with highly literal images once decorated the hotel rooms and corridors. The new art package, as they call it, is much more subtle in its native themes.

Espeland was one of nine interior designers at the project’s peak working for The Cunningham Group, the architect firm over the casino expansion.

Common threads run through the casino, from the hotel’s front desk to the shopping concourse. But such a large, sprawling space needed variation, too.

Themes define four blocks within the casino: Mountain Breeze, Woodland Moon, River Valley and Earth Water. The interiors team devoted an entire wall of their office to a creative board, papering it with key words and adjectives that related to each theme.

Set into the ceiling above gaming tables in Woodland Moon, lighting shines through yellow glass set in a tangle of wooden beams, meant to convey dappled light filtering through tree branches. In Earth Water, a light display covers a three-story wall to give the sensation of falling water drops.

Also part of the Earth-Sky zone, the 600-seat buffet has a soaring ceiling bulging with angular rust red boulders. A giant two-story marble slab on one wall is inlaid with jagged, elongated mirrors representing fissures in a rock face.

“It’s the notion of being in a geologic formation,” said Erik Sneed, construction manager of the project. He pointed out the ceiling overhead dotted with constellations.

The finer points of design are so imbedded throughout the casino, it’s impossible to discover them all. Even the newly-opened food court, featuring a Dunkin Donuts, Boar’s Head deli counter and the like, is so polished that “food court” is hardly the right name for it.

“Of course, we did it with typical casino flare — spent a fortune on all the fixtures,” Sneed said.

Pegg thinks it was the right call.

“We’ve all been to that place that is supposed to be great but you get there and it is only alright,” Pegg said. “Here, there is going to be that ‘wow’ factor. People will want to come back again and again.”

The Mirage has a volcano. There’s the Fountains of Bellagio, and the pyramid-shaped Luxor.

Cherokee will have the Rotunda, the crown jewel of the $633 million expansion to be unveiled next year and serve as the new casino entrance.

“With any casino, the notion of a grand arrival is key to create a sense of excitement,” said Erik Sneed, the tribe’s construction manager over the project. “You want a huge sensomatic, volumetric experience.”

And that’s exactly what Cherokee will have.

Shining five-story trees made of colored glass, like giant Tiffany lamps, ring the Rotunda with a 75-foot waterfall cascading down the middle. A 140-foot screen wraps around the walls where choreographed shows will be projected in concert with visual manipulation of the lighting in the trees and waterfall, along with intense audio effects.

“The lights will go down, you hear thunder rumble, suddenly the trees glow an intense red, the screen comes on, the music start and the show plays,” Sneed described.

One of 15 shows will play on an hourly schedule.

A massive, floating, spiral staircase winds through the trees and wraps around the waterfall. The self-supporting staircase was designed without columns underneath.

“We wanted the effect of a staircase that looked like it was suspended in thin air,” Sneed said.

But it also took an engineering feat to float with 50 tons of twisted steel.

“The only place that could roll steel that big was in Canada. We had to buy the steel, have it fabricated, shipped to Canada and then back to Cherokee,” Sneed said.

As Harrah’s Cherokee Casino closes on the final year of a massive $633 million expansion, the hum of construction that’s been a backdrop to life in Cherokee will give way to a luxury resort positioning the Eastern Band of Cherokee Indians for unparalleled economic dominance in the region.

“It is unlike anything else that has ever been attempted,” said Erik Sneed, the tribe’s construction oversight manager for the expansion. “You’ve seen projects like this in Vegas or Atlantic City. Rarely have you ever seen it in Indian Country.”

The project had 1,100 construction workers at its peak and 43 architects and interior designers.

Anecdotes depicting the sheer size of the project are limitless. Sneed traveled to Korea to negotiate directly with Samsung for televisions. Nothing quite says purchasing power like an order for 800, 42-inch flat screens.

The expansion was a monumental attempt to change the face of Cherokee’s casino into a resort destination and draw a new demographic of gamer.

It was pursued at great cost, and perhaps risk. It’s the largest construction project in the Southeast, no small feat in recession times. But the tribe simply could not continue to sit on its laurels, said Darold Londo, general manager of Harrah’s Cherokee.

“There were people who were happy with what they had, the whole ‘one in the hand worth two in the bush thing,’” Londo said. “We don’t have that luxury because our customers play elsewhere. They go to all the other gaming markets in the country. There is an incentive to keep pace with them.”

When the expansion is finished next year, the casino will have pulled off a five-year construction project while remaining one of the most profitable Harrah’s casino properties in the nation.

“My boss never wanted to hear construction used as an excuse. He said ‘Don’t tell me your revenues are off or your services scores are down because you’re building something new. I just don't want to hear it,’” Londo said.

Londo’s boss at corporate headquarters wasn’t the only one unwilling to give the Cherokee casino a pass on making revenue goals while in the throes of construction.

There were 13,900 other people — the enrolled members of the Eastern Band — counting on profits holding steady. Casino profits flowing to the tribe hovered around $225 million the past two years, with half funding tribal programs and the other half paid out directly to the Cherokee people in the form of twice-annual checks.

The tribe relies on casino money for many of its services, from subsidizing the hospital and the school system to native language programs for children. Families rely on their individual cut to make car payments, buy medicine and put their kids through college.

“One of the primary goals was to not affect the tribe’s distribution,” Sneed said.

The expansion won’t only double the number of games to a total of 4,600, but includes a complete renovation of the existing gaming floor.

The biggest challenge: maintain players’ experience and never, ever, go off line. Keeping the casino’s 3.6 million annual guests isolated from the construction zone around them was a feat in itself. False walls created a bubble around the operable areas of the casino while hundreds of construction workers toiled just on the other side.

“I call it the ticking dominoes,” Sneed said. “We’re cascading through a construction sequence.”

Matt Pegg, executive director of the Cherokee Chamber of Commerce, has been a doting spectator of the expansion.

“It has been impressive just to watch it,” Pegg said. “One day you walk around the corner and there is a big wall. The next day they have taken that wall away and there are 500 more machines or a food court.”

One work-around to keep the casino running amidst the construction — quite literally — stemmed from the unfortunate location of the main electrical room. It sat smack dab in the middle of the old motor coach lounge, destined for demolition to make way for an upscale steak house.

Contractors ruled out moving the main electrical room, which houses all the power panels that run the casino. Instead, they decided to demolish the building around it. Crews couldn’t mess up. Knock out the casino’s electrical power, and the lost revenue per minute was unthinkable.

“They were nervous as cats,” Sneed said of the demo crews.

Electrical crews couldn’t exactly kill the power either when it came time to move or add circuits, so specialized teams donning full-body rubber suits and helmets to work with the high-voltage live circuits.

While the guests are oblivious to the construction zone surrounding them, it’s hard to miss once you’re back-of-house.

Drill-slinging construction workers clad in blue jeans and work boots, tool belts clanging about their waists, scurry up and down the employee corridors. Drafting tables, spilling over with blueprints, are tucked into every corner of the hallways. The noise of saws and sledgehammers, somehow imperceptible on the gaming floor, is pervasive.

Even in the administrative wing, hardhats are never far from reach, looped over coat racks and stowed on bookshelves behind nearly everyone’s desk.

Taskmaster of great proportions

On a construction tour of the casino last week, Sneed made a stop over in the new 600-seat buffet, stepping around paint buckets and drop cloths, dodging men on ladders and weaving through a mine field of flying sawdust from table saws.

He excitedly started talking about the grand opening of the buffet just two weeks away without a hint of hesitation or flicker of doubt. It would all come together quite quickly, he said, not at all bothered that the flooring still wasn’t down, dining room tables were no where in sight, let alone finishing touches like napkin dispensers.

“We haven’t delivered anything late so far,” Sneed said.

Execution of the construction project was critical, and the tribe wasn’t leaving it to chance. True to form, the tribe once again proved its capacity for foresight by hiring two of its own contractor liaisons. Their job: ride herd on the construction crews, make punch lists, double check work against blueprints, even scout for the best pricing on interior fixtures.

Harrah’s corporate, with a lot riding on the expansion as well, sent two of its own experts in construction oversight.

“Because of the size and the scale, we wanted to make sure the interest of the tribe was represented in the performance of the work,” Sneed said.

There were 50 to 60 subcontractors working on the job at any given time. Sneed set up shop smack in the middle of the contractor’s encampment, a field of 20 trailers across the street from the casino that served as the central nervous system of the expansion.

As Sneed strolled through the buffet still under construction last week, he pointed to newly installed light fixtures that were the wrong kind and need replacing.

“We saw those and thought, ‘Those don’t blend very well with the architecture. Is that right?’” Sneed said. “So we had to go back and compare it to the drawings.”

The tribe switched contractors part way into the project, parting ways with the crew initially hired for the job over what Sneed referred to as “some mix-ups along the way.” Turner Construction, a century-old company and one of the largest in the country, was brought on. It was a good move, Sneed said.

“You are hiring that company because of their resources, but also their credibility. They have a reputation to protect in the industry and so they aren’t going to screw something up and leave it,” Sneed said.

A maze of construction

Most people would need a road map, if not a handheld GPS, to find their way through the maze of construction corridors and work zones, accessed to those in the know by slipping behind black curtains or ducking through the many “no-entry” doors pocking false walls on the gaming floor.

“It’s confusing. You could easily get lost on this project,” Sneed said.

But not Sneed. He knows the project like the back of his hand, a three-dimensional map of the blueprints seared into his mind.

For the directionally challenged, the casino has maps for hotel guests. Navigating the gaming floors, eateries and retail concourse is tricky enough without adding in the complexity of trekking there from one of the hotel towers and back.

But to steer the majority of guests, way-finding signs are mounted overhead, designed by an expert in such signage brought in a consultant.

“When you have a building this size, you have to make sure way finding is clear cut,” said Sneed. “It is so enormous, people have to understand clearly how to get out of this building in case something ever happened.”

At regular intervals on the casino floor, there are large interactive signboards, akin to a digital version of a shopping mall key, for resort guests to find what they are looking for and how to get there.

Getting lost isn’t the only problem. Getting around is too, especially for the older population of gamblers who make up the large part of Harrah’s customer base. They don’t have the mobility to make long treks.

“If you’re staying in hotel tower one and your favorite game is in Mountain Breeze, you are going to walk about a mile,” Sneed said. “It is a challenge.”

The solution: layover points to stop and rest and visually pleasing elements along the way.

“We designed it with a sense of journey so that as people make their way through, you have this or that to catch your eye and look at,” Sneed said.

It might be a group of sofas by a fireplace, artwork inlayed into the tile floor or balconies overlooking the gaming floor. A collection of sky bridges means players never have to go outdoors.

Londo said the casino is breaking industry norms with the lounging areas. For years, consumer psychology experts preached against places to loiter, warning that it is best to keep people on their feet browsing and shopping.

But Darold Londo, Harrah’s Cherokee general manager didn’t subscribe to that school. The casino was just too big for older guests not to stop and rest.

“It’s a haul for anybody, but if you are challenged getting around ...” Londo said.

Londo also cited insight from his current bedside reading, Why We Buy: The Science of Shopping. The author’s studies of consumer habits found lounging areas are not, in fact, detrimental to sales.

In coming weeks, the casino plans to deploy a fleet of golf carts to shuttle people back and forth to the hotel towers similar to those used in an airport. It also rents electric scooters.

Going vertical

Harrah’s hotel towers are the only structures west of Asheville in the state that are equipped with seismograph detectors. Hemmed in by mountains on a landlocked reservation, Cherokee had little choice but to build up.

“We shoehorned it all in,” Sneed said. “We couldn’t take a horizontal site and expand out. We had to think vertical.”

It’s obvious from the outside — with the soaring hotel towers and parking decks. But it also influenced the basic layout inside. A giant 600-seat buffet overlooks the gaming floor from a mezzanine, while a large 3,000-seat concert venue sits above it on the second floor. The stacked layout called for dozens of elevators and escalators.

The site limitations came at a price.

“We spent millions developing the site to accommodate an expansion this large,” Sneed said. “We went through literally months of blasting everyday getting through solid rock.”

Ultimately, construction called for nine retaining walls, including a 75-foot “soil nail” wall, the largest in the South. There was $1 million on a dewatering system for the parking garage. Another $2 million for federal stream mitigation to work around a creek that courses through the middle of the sprawling casino property.

Site work was the only portion of the construction that faced delays or cost overruns, a nasty side-effect when dealing in the unknowns of what lies below ground.

The project, once finished, will undoubtedly be a towering symbol of the tribe’s progress, a fitting monument to how a once persecuted people have bootstrapped themselves into the single largest player in the region’s economy through foresight and vision.

“It is going to attract an entirely different clientele. This isn’t just a daytrip casino any more,” Sneed said. “There’s a legacy in this also. We want to build something the community is proud of.”

Principal Chief Michell Hicks won Thursday’s election in Cherokee, becoming only the second chief ever to be elected to a third term.

All incumbents in Cherokee managed to hang on to their seats in the election, signaling that voters believe the tribe is on the right track and hesitant to upset that momentum with a change in leadership.

Hicks barely eked out a victory, however, besting challenger Patrick Lambert, by just 135 votes. But the gap was wider than the slim 13-vote margin Lambert lost by in 2007 when he took on Hicks for the first time.

Hicks believes it’s the advances he’s made and the continuity he provides that won over voters. They ultimately agree, he said, with the progressive track the tribe has been on and the advances it had made in the past eight years under his leadership.

“I think the real scare for people is they were afraid progress would not continue for the tribe and we would step backwards,” Hicks said. “I think that was one of the big decision makers.”

The tribe has built a state-of-the-art K-12 school, an emergency operations center, took over its own hospital, opened a movie theater, developed new parks and greenways, attempted a facelift for blighted commercial strips, and pushed a raft of green initiatives under Hicks’ tenure. It’s also focused on cultural renewal efforts, such as the Kituwah Academy, a school for children dedicated to keeping the Cherokee language alive.

There was no doubt the race would be close, with Lambert actually beating Hicks in the primary this summer. Though Hicks got more of the vote, he and Lambert split the six districts evenly.

In Yellowhill, Painttown and Big Y/Wolftown, Hicks carried the vote. In Big Cove, Birdtown and Cherokee County/Snowbird, the tally swung in favor of rival Lambert.

Stepping down to vice chief, Larry Blythe is back in for another term, beating opponent Teresa McCoy by a mere 76 votes. McCoy, who had 49 percent of voter favor, had challenged in 2007, but lost then as well.

McCoy’s bid for vice chief cost her a council seat. She currently sits on tribal council and couldn’t run for that seat and the vice chief position simultaneously.

Her vacant council spot hosts the only new face with a victory in this election. Bo Taylor will join incumbent Perry Shell in representing Big Cove at tribal council.

Elsewhere on the reservation, the other 11 sitting tribal council members held onto their posts, all with margins of at least 35 votes between the winner and the next closest challenger.

Turn out was average, with 62 percent of the 6,704 registered voters in the Eastern Band of Cherokee Indians coming out for the election.

During exit poll interviews, few were willing to hazard a guess as to the winner or share their personal leanings.

Many at the polls were tight lipped about who they voted for. One man in Painttown, Bryson Catolster, refused to divulge his choice before walking back to a car plastered in signs supporting Lambert.

In Big Cove, Carol Long cited professional concerns as the reason she wouldn’t open up about her preferred candidate. Long works with a drug and alcohol addiction program in tribal court and must keep good relationships with whomever is in power for her program to be a success.

Her concern is shared by others here, where so many rely on the tribe for jobs, whether it’s at Harrahs’ Cherokee Casino or in tribal government or the many programs it provides.

Margie Taylor would say she voted for Hicks in the Yellowhill community, but the woman who exited the polls just after wouldn’t give her name, even though she said she left the box for principal chief unchecked on her ballot.

With his win, Hicks is only the second chief to serve a 12-year term. He’ll now have to live up to his biggest campaign promise — eradicating tribal debt by 2014.

Hicks had said throughout the election season that he wanted to hold onto the seat to take care of the unfinished business of tribal debt, excluding the ongoing $633 million expansion at Harrah’s.

In addition to paying down the tribal debt, he listed better social services as another priority going into the next four years.

“I want to make sure the social services system is restructured so it truly takes care of Cherokee families,” Hicks said. The tribe currently relies on the Department of Social Services in Jackson and Swain counties to provide child welfare services, including intervening in cases of child abuse or neglect. After the death of a Cherokee child in Swain County earlier this year, Hicks is leading the charge to bring social services under the tribal umbrella.

Bringing tribal services in-house is a currently a theme in Hicks’ administration.

A new justice complex is also on the to-do list this term. Tribal members are now held in neighboring county jails, but the completion of the complex will allow them to stay in Cherokee and get drug and alcohol rehabilitation if they need it.

The center will also house the tribal court, where the tribe is working to get Tribal Prosecutor Jason Smith appointed as a federal prosecutor, too, so more Cherokee cases can stay in tribal hands.

“Our goal is to become self-sustaining and obviously we are well on our way to doing that in all areas,” Hicks said.

Meanwhile, Lambert, who wasn’t taking calls after the results came in, maintained throughout the campaign that spending and debt under Hicks were out of control and not accountable to the people.

“We can do better than we are doing, we can make the tribe a better place by paying down the debt, getting more resources going towards the families,” said Lambert in July.

Hicks wouldn’t say if he’s planning to run again in 2015, but did say he wanted to pass on a solidly positioned government to the next administration.

“In four years, by the time I leave, that is what I want to leave the next leaders is a foundation that is secure,” Hicks said.

The numbers aren’t yet official and probably won’t be until at least Friday.

Candidates have five business days to protest any voting irregularities and two business days to ask for a recount if the results showed less than 2 percent difference.

Only Teresa McCoy could ask for a recount this time. She lost to Blythe by just 1.83 percent. The other 0.17 percent went to the seven write-in votes for vice chief.

Hicks retained his place by a margin of 3.22 percent. There were 80 write-in votes for principal chief.

Yellowhill, Painttown and Big Y school board members were also chosen.

Official results are scheduled for presentation to tribal council on Oct. 5.

Election results

Winners in bold; top two vote-getters win council seats.

Principal Chief

• Michell Hicks: 2124

• Patrick Lambert: 1989

• Write-in: 80

Total: 4193

Vice Chief

• Larry Blythe: 2112

• Teresa McCoy: 2036

• Write-in: 7

Total: 4155

Yellowhill Council

• Alan ‘B’ Ensley: 289

• David Wolfe: 351

• Jimmy Bradley: 211

• John D. Long: 91

Big Cove Council

• Frankie Lee Bottchenbaugh: 190

• Bo Taylor: 230

• Perry Shell: 303

• Lori Taylor: 157

Birdtown Council

• Gene ‘Tunney” Crowe Jr.: 696

• Jim Owle: 691

• Terri Lee Taylor: 420

• Faye McCoy: 112

• Write-in: 1

Painttown Council

• Tommye Saunooke: 346

• Marie Junaluska: 241

• Yona Wade: 181

• Terri Henry: 280

• Write-in: 1

Big Y/Wolftown Council

• Dennis Edward (Bill) Taylor: 525

• Mike Parker: 531

• Dwayne “Tuff” Jackson: 354

• Kathy “Rock” Burgess: 363

Cherokee County/ Snowbird Council

• Diamond Brown: 266

• Adam Wachacha: 285

• Brenda Norville: 163

• Angela Rose Kephart: 211

Election season is closing in Cherokee, where races for principal chief, vice chief, tribal council and school board members will culminate when voters hit the polls on Thursday, Sept. 1.

Incumbent chief Michell Hicks is trying to keep a grip on the position for a third term. If he’s successful, Hicks would be just the second chief to hold office for 12 years.

His challenger is Patrick Lambert, long-time attorney for the Tribal Gaming Commission, which regulates the tribe’s gaming operations.

This is the second round between Lambert and Hicks, who sparred in the 2007 election. That race had a contentious ending, with Hicks besting his opponent by only a handful of votes. Though Lambert challenged the outcome in the tribal court, the count stood and he was put off for another four years.

But unlike 2007, Lambert won the primary earlier in the summer, taking 46 percent of the vote. Hicks garnered 40 percent of the roughly 3,000 voters who turned out.

At the time, Hicks said he was confident in his voting base, especially given that only around half of registered voters cast ballots in the July primary.

In the vice chief race, it’s another rematch. Larry Blythe is running to maintain his seat, while current council member Teresa McCoy is trying to take his job after a loss to Blythe in 2007. She took the primary, with 39 percent of the vote. But Blythe wasn’t far behind, taking in 36 percent.

The issues that have defined this election centered around Harrah’s Cherokee Hotel and Casino, the tribe’s central money-making venture. Questions about the economy, fiscal responsibility, diversification and services to tribal members all eventually came back to the casino, and what it was doing for the tribes 13,500 members.

Per capita checks, the payouts given annually to tribal members from casino revenues, were down this year, and some questioned the wisdom of continuing to pin the tribe’s financial hopes on Harrah’s alone.

Whoever wins the post on Wednesday will deal not only with falling revenues and a still-unfinished casino expansion, but also the impending negotiations over live dealers.

Gamblers at Harrah’s currently don’t enjoy the casino experience that Las Vegas patrons do; the tribe’s contract with the state doesn’t allow table games such as craps and roulette or live dealers at poker and black jack tables.

Last week, two top Republican state senators travelled to Cherokee to discuss the idea of Vegas-style gaming there.

The General Assembly has already pledged to vote on the issue in the new legislative session that starts Sept. 12.

The new principal chief, however, would still have to navigate negotiations with Gov. Beverly Perdue, and such talks can at times be tricky.

The last attempt to bring live dealers to the casino stalled after negotiations between Chief Hicks and then-Gov. Mike Easley disintegrated. At various times throughout the campaign, Lambert has charged that Hicks mishandled the situation.

Polls open at 6 a.m. on Thursday, Sept. 1, and close at 6 p.m. Registered voters who are in line at 6 p.m. will be allowed to vote.

Cherokee tribal elections are little more than a week away, and with the economy topping the list of major issues, the salaries of tribal officials are raising eyebrows and some ire on the reservation.

Both candidates for principal chief have stumped relentlessly on debt-reduction and spending-control platforms.

Whoever wins, however, will enjoy a sizable paycheck and a generous, lifelong pension, despite enrolled members seeing their per capita checks decline last year because casino profits were down.

Current Principal Chief Michell Hicks enjoys a base salary of $142,458, plus a car and an extra 30 percent of his base pay in fringe benefits, such as health care. That adds up to a total compensation package of about $185,000, not counting the car.

Vice Chief Larry Blythe is paid $129,896, plus given use of a car and 30 percent in fringe benefits, like the chief. Total, the vice chief earns nearly $169,000.

If challenger Patrick Lambert wins the top post, however, he’ll actually be leaving a much more lucrative position.

Lambert is executive director of the Tribal Gaming Commission, which makes sure the tribe’s gambling operations, whether in the casino or tribal bingo, are on the up and up.

The TGC regulates gambling licenses, monitors casino payouts to ensure compliance with federal regulations and provides other oversight, such as background checks into managers and internal investigations.

Lambert’s base salary this year was $250,000, according to a gaming commission budget provided to The Smoky Mountain News. When you add in the fringe benefits, bonuses and vacation pay, the total comes to $446,355.

Lambert said that weighing his salary against the pay of public officials isn’t a fair comparison. Elected tribal leaders are public servants, while he is in the gaming industry, he said. It’s business versus government, and the two will never be equal, he argued.

“It’s no secret that I make a substantially larger amount than the chief does, and my salary is graded on a national comparison level with my years of experience and qualifications,” said Lambert.

Lambert believes his opponents are publicizing his pay as a tactic to divert public attention from what he considers the real issues of the campaign.

Lambert’s pay doesn’t come directly from the tribe like the principal and vice chief’s salaries.

The gaming commission gets its money from the businesses it’s regulating: it is funded by the Tribal Casino Gaming Enterprise, the management entity that oversees Harrah’s operations. To a lesser extent, the commission is also funded by the Tribal Bingo Enterprise and revenue generators such as background checks and license fees that it charges the gambling operations.

Indirectly, however, both salaries spring from the same fiscal headwaters: gaming revenues.

And both are significantly higher than the average in Cherokee.

In Jackson and Swain counties, which the reservation straddles, the median household income is $36,761. Statewide, it’s $43,754.

Principal Chief Hicks makes more than North Carolina’s governor. Lambert’s base pay surpasses that of the vice president of the United States.

Lambert’s compensation is based on the results of a tribal pay scale study done every few years by an outside firm, which looks at comparable jobs around the country and what people in those posts are paid.

The principal chief’s salary is decided by tribal council. Tribal council also vote on their own salaries ($70,000 a year each), and that of the vice chief.

It’s difficult to gauge whether Hicks’ or Lambert’s incomes match comparable positions elsewhere. Salaries in the private gaming sector aren’t public information, and a good many tribal governments don’t offer that information up, either.

A few tribes do have pay stats out there, mostly as a result of a public row over whether the pay is too high.

The principal chief of the Cherokee Nation in Oklahoma currently makes $122,444, but a committee suggested this spring that the number be raised to $170,697 over the next four years. The Sisseton–Wahpeton Oyate in South Dakota pay their top guy $80,000, decreased from $100,000 just this year.

For Lambert’s position, it’s even harder to determine. He maintains that a fair comparison would pit him against people such as Darold Londo, general manager at Harrah’s Cherokee Hotel and Casino. Londo’s salary isn’t public, and neither are those of many other top gaming officials, making the suggested comparisons impossible.

Recruiting firm Bristol Associates does an annual survey of gaming executives, and it reports that top spots in gaming can bring from $100,000 to $400,000 on average.

Lambert defended his pay, and said that if he won the chief’s seat, he wouldn’t keep his current job or the salary that comes with it.

“I’m a licensed attorney, I’ve got over 18 years of experience in this field, and we’ve been very successful. And the pay classification study proves that out,” said Lambert. “To me, if a man’s willing to take a cut in pay to do public service, to me I think that’s a good sign.”

Tribal council members also will have to defend their pay to voters. Their $70,000 annual payout far surpasses the $13,951 made yearly by North Carolina state legislators. In fact, only three states pay their lawmakers as much. However, it’s far below the $174,000 paid to members of the U.S. Congress.

Tribal council isn’t allowed to raise the pay of a sitting council; they can only decide what the next council should make. Usually, those raises are given in the October lame-duck council session.

Council Chairman Jim Owle wouldn’t speak directly to whether he thought the council members’ salaries were fair.

“The pay is what it is, it’s set by tribal council. It’s something that’s voted on in council, and if they think that’s what’s right, that’s what’s voted on,” said Owle, noting that any tribal member could bring a resolution to change it if they were unhappy with the pay.

Pensions for life

Salaries aren’t the only benefits afforded to tribal officials. Starting at age 50, all former chiefs, vice chiefs and tribal council members are afforded a pension that can be up to half of their in-office salary, depending on how long they served.

Tribal council in a split vote in 2009 made the decision to increase pension benefits, a controversial move in the midst of a recession.

Should Hicks lose the election and leave office, when he hits 50 in three years he’ll start getting a pension that’s worth half of his salary — or $71,229 a year for the rest of his life.

The chief’s spouses is also entitled to a lifelong pension if the chief dies, equal to a quarter of the chief’s last salary for two-term chiefs and an eighth for one-term chiefs.

The vice chief’s retirement plan follows the same rules as principal chief.

Tribal council members don’t get quite as much. When they hit 50, they’ll get between 12 and 75 percent of their salary depending on how many years they served.

Winners of principal and vice chief, the 12 tribal council seats and some school board positions will be decided during the Sept. 1 election.

Principal chief candidate Patrick Lambert is calling foul after refusing to divulge his pay information to the tribe’s internal auditors. Lambert said they were trying to expose his personal information as a political smear.

The tribe’s internal audit office told Lambert it needed to know his salary at the Tribal Gaming Commission to prepare taxes for the Cherokee Youth Center/Boys & Girls Club. Lambert is a board member. The IRS, it claimed, needed the income paid to any board member of the Boys & Girls club by a related entity.

Both the Boys & Girls Club and gaming commission are tribal operations, so that means related, said the auditor.

Lambert, however, said “no.” Of all the people who sit on that board, why, he asked, was he being singled out?

“Nobody else was contacted to my knowledge,” said Lambert. “I refused to give my W2s. There’s often times people on these volunteer charity boards refuse to give these things, and the IRS accepts that fact if the organization has used reasonable effort.”

Auditor Sharon Blankenship, however, wasn’t taking “no” for an answer. She came to the office of the Tribal Gaming Commission, looking for the documents herself.

She was rebuffed there, as well, and asked to leave after Lambert’s staff put in a call to the Cherokee Police Department. Cherokee Code says that no one but a gaming commissioner can access gaming commission files.

Lambert charges that the effort to uncover his salary is politically motivated, an attempt by the current administration to use it as a smear campaign against him. Blankenship contends that she’s just trying to follow the rules set by the IRS.

The issue came up in a special session of tribal council last Wednesday, where Council Member Teresa McCoy asked why the audit office was going after the papers now.

“I was on that board in 2010 and nobody came to my house and said, ‘I want to look at your tax papers,’” said McCoy.

Blankenship, however, defended her actions. They did, she said, get in touch with everyone and the gaming commission is the only one that didn’t provide salary information.

In the end, Lambert’s attorney turned in an IRS form, but maintained that Lambert is in no way obligated to give out his W2s.