Monday, January 30, 2006


Gambling compact barely approved
Potawatomi deal OK'd by federal officials after last-minute lobbying
Last Updated: May 1, 2003

Federal officials reluctantly approved the new gambling agreement between the Potawatomi Indian tribe and the state only after an intense round of last-minute lobbying, and they still view claims that the deal violates the state constitution to be an open question.

A letter released Thursday from Acting Assistant Interior Secretary Aurene Martin noted that two lawsuits have questioned whether additional games allowed under the new Potawatomi agreement were barred by a 1993 amendment to the constitution.

Both lawsuits contend that provisions of the Potawatomi gambling deal authorizing several new games, including roulette, craps and poker, are illegal.

Even though that "is an unsettled issue," Martin wrote, "the best alternative available to the Department of Interior under the Indian Gaming Regulatory Act" was to passively allow the Potawatomi deal to take effect. Martin leads the department's Bureau of Indian Affairs.

The Martin letter to Potawatomi Chairman Harold "Gus" Frank does not say what would happen to the Potawatomi deal - or the seven other similar pending deals with other Wisconsin tribes - if a court rules that they conflict with the 1993 ban on new forms of gambling.

Potawatomi spokesman Tom Krajewski said Thursday that although the Interior Department raised concerns, the tribe's new gambling pact was a done deal.

"They may view it as unsettled, but I'm not sure that we do," he said.

Senate Majority Leader Mary Panzer (R-West Bend), an opponent of the new gambling deals, said she was heartened by the BIA letter. It may signal an intention by BIA to reopen the compacts if a court rules the new casino games are illegal, she said.

The Interior Department's finicky handling of the Potawatomi compact may reflect the legal complexities raised, including whether state or federal law trumps on the matter. One lawsuit, filed by Dairyland Greyhound Park in Kenosha, is before the state Court of Appeals. A second lawsuit, filed by Republican legislative leaders, is pending in federal court, but the lawmakers want it transferred back to state court.

Martin's letter also says the Interior Department was unsure whether the tribe was paying the state too much under terms of its new deal. The Potawatomi have agreed to pay the state $84 million over the next two years, and between 6% and 8% of net casino revenue after that. The tribe paid $6.75 million a year under its old gambling agreement.

Tribal payments are supposed to be made solely for exclusive gambling rights, not for adding new games, raising limits on numbers of slot machines or extending the duration of the tribal-state deal, Martin wrote.

The Potawatomi pact and other new gambling deals negotiated by Gov. Jim Doyle's administration run forever, which was the key change sought by the tribes. The old compacts had five-year terms. All terms of the Potawatomi compact can be reviewed after 25 years at the request of the tribe or the state.

The Interior Department, however, didn't ultimately object to the new Potawatomi payments because the tribe "reassured us that it will receive the benefit of the bargain" and will be able to afford the payments to the state, Martin's letter said.

Intense lobbying

The Potawatomi deal, the template for similar deals with the state's other 10 tribes, was subject to an extraordinary 11th-hour round of intense Washington lobbying by forces both for and against the plan. Key congressional figures sympathetic to tribal gambling were tapped for the fight, as well as former Gov. Tommy G. Thompson, now U.S. Health and Human Services secretary.

Assembly Speaker John Gard (R-Peshtigo) and Panzer said they each telephoned Thompson seeking advice and assistance on the Potawatomi deal they hoped to kill.

Gard and Panzer said they didn't specifically ask Thompson to try to pull strings with the Bush Administration to put a stop to the Potawatomi gambling pact, and they didn't know whether he made any contacts.

"What I talked to him about was the best way to approach the BIA," Panzer said. "His suggestion was to write a letter." Thompson aides did not return phone calls on the subject Thursday.

The Interior Department was poised to kill the Potawatomi deal just days before its April 5 deadline for action, according to an aide to Sen. Daniel Inouye (D-Hawaii). That's when Inouye and Sen. Ben Nighthorse Campbell (R-Colo.) agreed to try to salvage the pact after an appeal by lawyers for the Potawatomi, said Patricia Zell, the Inouye aide.

A flood of correspondence to Interior officials and key congressional supporters of Indian casinos also was triggered by the National Indian Gaming Association, a pro-tribal casino group.

Both Inouye and Campbell sent letters in early April to Interior Secretary Gale Norton about the Potawatomi deal, with Inouye cautioning her that rejecting the Potawatomi deal would amount to a major policy shift.

Both noted it has been general practice for the Interior Department to approve gambling deals negotiated by states and tribes.


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