River Rock Casino has stopped reporting its quarterly revenues and other business data to federal securities regulators, after restructuring $200 million in debt late last year.
Executives at the tribal casino said the move will have no impact on investors or the public.
"Nothing really changes in terms of what we do," said David Fendrick, River Rock's CEO.
But the change could make it harder for River Rock to raise money for expansion, according to investment experts.
The Alexander Valley casino is owned by the Dry Creek tribe of Pomo Indians. It reported $124 million in sales in 2010, the last full year that results were publicly available.
The tribal casino's decision to stop disclosure is a concern for Sonoma County government, which gets $3.5 million a year in mitigation payments from River Rock.
"This is going to mean that the tribe and the county are going to need to work more closely together to make sure commitments are met going forward," said county Supervisor Mike McGuire, who represents Alexander Valley.
River Rock is no longer reporting financial data under the Sarbanes-Oxley Act, a 2002 federal law that requires public companies to provide detailed disclosure of their finances to the U.S. Securities and Exchange Commission.
The casino isn't covered by the law, but it voluntarily complied after selling $200 million in casino bonds to investors in 2003, said Joe Callahan, River Rock's chief financial officer. River Rock's tribal owners felt public reporting would help create a stronger market for its bonds, Callahan said.
The casino defaulted when the bonds came due in November, but River Rock was able refinance the debt in December at slightly lower interest rates.
Most of River Rock's debt is held by high-yield bond funds, pension plans and other investment funds.
The casino decided to stop observing the Sarbanes-Oxley rules because it cost too much, Callahan said.
"It was very onerous," he said. "All those requirements cost us $700,000 a year."
The casino will continue to provide the information to investors, but they must agree not to share it. River Rock still is subject to regular audits and regulation by state and federal gaming authorities, Callahan said.
When companies stop reporting their financial results — known as "going dark" in the investment community — they don't get credit ratings or attention from industry analysts. Standard & Poors dropped its ratings for River Rock bonds in January.
"As we no longer rate the company, we are not in a position to comment on it," said Mimi Barker, a spokeswoman for the New York ratings agency.
"Going dark" can hurt a company's ability to attract new investors, according to several studies of the trend.
River Rock shelved plans for a 267-room casino hotel and other attractions in 2008 after U.S. financial markets collapsed, and the project remains on hold.
It won't be easy for the casino to expand in the current market, said Geoffrey Rocca of Fructivore.com, a bond investor and blogger who follows River Rock.
"The market has turned against casino bonds in general," he said.