Miller backs casino to fund Vikings stadium

By Mary Juhl winonadailynews.com | Posted: Friday, April 6, 2012

Proponents of a new Vikings stadium have found assistance from a new source: Sen. Jeremy Miller.

The Winona Republican introduced a bill this week that would create a partnership between the state and the White Earth Nation to construct a stadium and new casino. White Earth has offered $400 million to fund the entire public share of the proposed stadium if the state agrees to regulate and audit a casino the tribe hopes to open in the Twin Cities metro area. Casino revenue would be split evenly between the state and White Earth.

“This is a pretty great example of a public-private partnership, and it would absolutely create jobs and promote jobs in the state of Minnesota,” Miller said.

The White Earth Nation, located east of Fargo in the northwest part of Minnesota, is the state’s largest and economically poorest tribe. It has occasionally sought state backing for a Twin Cities casino for several years. It appears to have found an unlikely partner with a southeast Minnesota lawmaker. But Miller said the stadium issue is one people raise every time he returns to his district.

“When we talked about this months ago, feedback from constituents was really positive,” he said. “They thought this was an idea that made sense to fund the Vikings stadium.”

Miller began aggressively pursuing the idea months ago, he said. He said the bill has bipartisan support in both the House and Senate, though it may not be enough. A solid bloc of lawmakers opposes any major expansion of gambling. Plus, the state’s wealthiest American Indian tribes see unwanted competition to their own Twin Cities-area casinos and have powerful allies in the Legislature.

“I don’t know that it has the votes,” House Speaker Kurt Zellers said.

And Miller will have to fast-track the bill — legislators are headed home for a 10-day break, and it isn’t clear how ambitious they’ll be at the Capitol as they prepare to hit the campaign trail.

“I’m still optimistic that we can get something done on the Vikings stadium,” Miller said. “I’m not going to stop until the end.”

The Associated Press contributed to this story.

White Earth to state: ‘You have the ball’ on stadium

By: Don Davis, Bemidji Pioneer

1.    

ST. PAUL – The White Earth Nation says it will front the state’s Vikings stadium construction costs, if it receives approval to build a Twin Cities casino.

Chairwoman Erma Vizenor of the northwestern Minnesota American Indian tribe Thursday announced White Earth is tweaking an earlier proposal so the state would get $400 million up front, and then receive half of all casino profits. She said that could amount to $1 billion in the first five years of casino operation.

“We have moved the ball to the goal line,” Vizenor said. “It is now the governor and Legislature’s turn; you have the ball.”

The proposal means the state would not need to sell bonds, and repay them with interest, to finance the stadium, she said.

“Minnesota will have the money and the Vikings will be able to proceed in a timely manner,” Vizenor added.

However, the up-front money would come only after a casino receives final approval, which might not come until after a court challenge.

Vizenor and other supporters suggested that the existing legislative proposal to use new revenue from allowing electronic pulltabs and bingo could provide stadium funding until a casino is approved and the tribe can hand over the $400 million.

Opponents to the plan include the Minnesota Indian Gaming Association, which represents most Minnesota American Indian tribes with casinos, but not White Earth. The other tribes worry that a new Twin Cities casino would take customers from them.

A spokeswoman for Gov. Mark Dayton said he continues to oppose funding a stadium via a casino because it would be unreliable.

House Speaker Kurt Zellers, R-Maple Grove, said he would look at the proposal, but was not optimistic.

“I don’t know it has the votes,” he said.

He also said with the end of the legislative session approaching, it is unlikely to be done this year, and said there are questions surrounding the funding.

The White Earth announcement came as a Senate stadium construction bill remains stalled and a House proposal is slowly advancing but with many concerns from legislators.

Thursday’s announcement was a tweak to a proposal Vizenor unveiled in February to work out a casino partnership with the state. The tribe would foot the entire $700 million to build a casino and split profits with the state.

“We are making a good solution better,” she said.

Vizenor said casino planners are looking at several potential locations, including Minneapolis, Arden Hills and Anoka.

The tribe says it does not get enough profit from its existing casino in Mahnomen and since 2005 has sought a Twin Cities presence. White Earth members make up 40 percent of the state’s American Indians and it is the poorest tribe.

Besides promising the state $400 million up front, the White Earth plan would guarantee $12 million for Canterbury Park and Running Aces to improve purses at the state’s two horse-racing tracks. Supporters said White Earth would fill the gap if the tracks’ existing gambling revenues, from betting on races and cards clubs, do not reach $12 million a year.

The two tracks long have sought permission to expand their own operations to allow casino-style gambling, arguing that more money is needed to save the horse industry.

Rep. Kent Eken, DFL-Twin Valley, said the purse provision was added because the $1 billion-a-year horse industry is struggling and many Minnesota horses are taken out of state to race.

Eken earlier introduced a bill to implement the White Earth plan, known as Minnesota Wins, but it has not received a hearing.

Sen. Jeremy Miller, R-Winona, said the White Earth proposal fulfills his constituents’ stadium wishes: “I don’t want to pay for it, but it is time to get this done.”

State's Five-Year Share of New Casino Could Reach $1 Billion, Says Analysis

  WHITE EARTH, Minn., March 13, 2012 /PRNewswire/ -- Minnesota would receive between $726 million and nearly $1 billion in new revenue from a Twin Cities casino during its first five years of operation.  The projections are based on comprehensive economic and market analyses of MinnesotaWins, a proposal by White Earth Nation to build a metro-area casino with net revenues split equally between the tribe and the state of Minnesota.

A market feasibility study conducted for White Earth concluded that the success of a metro-area casino does not depend on a significant expansion of gambling.  Instead, the region's population growth would accommodate both a new casino and the existing tribal casinos.

The economic projections are based on data compiled by leading investment banks and evaluated by Red-Horse Financial Group, Inc., a nationally-recognized financial consultant to tribal casinos.  First-year net revenues to the state are estimated at $140 million and would grow to $220 million in the fifth year for a total five-year pay-out of $968 million. 

White Earth Nation, which would be responsible for securing financing for all development costs, would receive a pay-out equal to the state's share. Even a more conservative financial projection – one in which debt payments were accelerated – shows a five-year pay-out of $1.452 billion split equally between Minnesota and the tribe, or $726 million for each partner. Revenue to the state would continue – and likely grow, according to the analysis – as long as the casino operated.

"All the money from a White Earth-state casino would stay in Minnesota," said Erma J. Vizenor, chair of the White Earth tribe.  "The tribe's share would be invested in housing, education, health care and economic opportunities, benefiting not just the tribe but all of northwestern Minnesota. The state could use its share for a Vikings stadium, to pay back schools, for economic development or for any purpose – and all of it with no new taxes."

Valerie Red-Horse, president of Red-Horse Financial Group, said the economic and financial projections are extremely reliable and credible because they are based on actual current gaming market sector data provided by leading bulge bracket Wall Street investment banks, not wishful thinking. "The economic analysis is based on proposals submitted by investment banks to finance the casino," she said.  "These are firms that have recently led and successfully closed similar financings in the market. In other words, they have a huge financial stake in the data being correct."

Red-Horse compiled the financial analysis using the average of business proposals received from three of the largest investment banking firms, current leaders in the gaming sector.  "The data were consistent across the three analyses with only minor variations," said Red-Horse.

Although the White Earth proposal is not site-specific, the revenue and cost analyses were based on developing a casino at the former Twin Cities Army Ammunition Plant in Arden Hills.  The White Earth proposal could be adapted to other sites, including Block E in downtown Minneapolis.  The metro casino could be located in a community different from a new Vikings stadium.

Construction of a casino and hospitality facilities would cost about $585 million.  The proposal also budgets funds for land acquisition and road and highway improvements, bringing the total development costs to $700 million.  White Earth would issue bonds for the development costs.

According to Ramsey County, land at the most likely location for the development within the Arden Hills site has no pollution issues.  In fact, the site could accommodate residential construction with no remediation, a much higher standard than the casino would require.

The economic projections are complemented by a market feasibility study conducted by another nationally-recognized firm, Gaming Market Advisors (GMA).  Consultants from GMA conducted a thorough market study, including on-site visits to all the area casinos and racetracks, and compiled economic data on the potential for the Twin Cities market to absorb a new facility.

"Due to the number of casinos already operating in the region, GMA did not aggressively grow the market," according to the market study. "Most of the projected growth in the market over the next five years will result from the projected growth in income and population. In total, GMA estimates that the local market will generate just over $1.6 billion of gaming revenue which will accrue to all of the casinos in the region."

GMA estimates that area casinos generated $1.3 billion in revenue in 2011, leaving a substantial market share for existing casinos even if a White Earth facility opens in 2015. 

The White Earth proposal is consistent with the intent and spirit of tribal gaming, said Vizenor. "There is ample precedent for casino partnerships between tribes and public governments. Our neighbors in Wisconsin and Michigan are among the many states that receive revenue from tribal gaming and, in some cases, are partners in off-reservation casinos similar to what White Earth is proposing," she said.

White Earth currently operates a casino, Shooting Star, on its northwestern Minnesota reservation. However, the location of the casino – far from major population centers – limits the casino's size, earning the reservation less than $10 million in most years.

"We have used the Shooting Star revenue to invest in decent housing, health care, schools and economic opportunities for our tribe," said Vizenor. "We are making progress, but the need is so great."  White Earth's reservation assets including Shooting Star will not be pledged as part of the new gaming facility's security.

White Earth is the state's largest and poorest tribe.

About White Earth
The White Earth Tribe, which calls itself Anishinaabe, meaning "the original people," is Minnesota's largest tribe accounting for almost 40 percent of Minnesota's native population. It is also the state's economically poorest tribe. The White Earth Reservation in northwestern Minnesota was created by the Treaty of 1867.


SOURCE White Earth Tribe

White Earth Tribe Proposes Partnership with State of Minnesota for Metro-Area Casino to Fund Vikings Stadium

ST. PAUL, Minn., Feb. 16, 2012 /PRNewswire/ -- The White Earth Tribe announced today that it is launching MinnesotaWins, a proposal to develop a metro-area casino that the tribe would run in partnership with the State of Minnesota. Net revenues from the casino would be split 50-50 between the tribe and the state, and could fund the entire public share of a new Vikings stadium as well as critical state priorities for years to come.

"Minnesotans are growing frustrated with the many ill-conceived schemes to fund the stadium," said Erma J. Vizenor, Tribal Chairwoman of the White Earth Tribe. "MinnesotaWins will provide much-needed jobs and economic development not only in the metro area but also in Minnesota's poorest areas, and provide a continued revenue source for the state. All with no new taxes. We are confident that our solution is the fairest option for all Minnesotans."

While the intent of the MinnesotaWins proposal is to have a casino located in the Twin Cities metro area, a decision on the exact location could be complementary to the location of a new Vikings stadium.

The White Earth proposal was introduced in the Minnesota House of Representatives this week (HF 2197) by Rep. Kent Eken (D-Twin Valley) and Rep. Bob Gunther (R-Fairmont) and has received Gov. Dayton's support. MinnesotaWins offers the following advantages:

• ALL money from this solution will stay in Minnesota. Up to 2,500 construction jobs and 2,000 new, permanent jobs will be created. In northwestern Minnesota, investments in housing and economic development opportunities will generate income and jobs for the tribe and other residents of the area.

• This is the ONLY solution that is consistent with the original intent of tribal gaming. The White Earth/State of Minnesota partnership would offer true transparency because the casino would be regulated and audited by the state.

• The White Earth solution would provide the entire public share of funding for a new Vikings stadium and create new revenue for other critical state purposes, all with NO new taxes. The casino would also continue generating revenue for the state after the stadium funding is complete. In addition, this casino will pay millions of dollars in sales and property taxes every year.

The White Earth Tribe has retained experienced gaming financial advisors and is in the process of selecting a senior investment bank to finance the MinnesotaWins casino project. The Tribe has received proposals from six of the top financial firms. The financing for the MinnesotaWins casino will be secured by the cash flow and assets of the project. The White Earth Tribe will be retaining professional management to operate the casino and has also already received strong industry interest in that area.

The tribe has commissioned an independent financial impact study that will be available in early March. The White Earth Tribe and advisors have received positive feedback from investment banks that expressed confidence in investment options.

"Once our due diligence is complete, we will put forth only one fully researched and accurate estimate of the revenue this solution will produce," Vizenor said. "This solution will be financially sound, fair to all Minnesotans and consistent with Minnesota values and priorities."

About the White Earth Tribe
The White Earth Tribe, which calls itself Anishinaabe, meaning "the original people," is Minnesota's largest tribe accounting for almost 40 percent of Minnesota's native population. It is also the state's poorest tribe. The White Earth Reservation was created in 1867 by a treaty between the United States and the Mississippi Band of Chippewa Indians. It is one of seven Chippewa reservations in Minnesota.

Contact: Teresa McFarland
952.440.6084 (office)
952.440.8088 (cell)
tmcfarland@mcfarlandcahill.com

Gov. Pawlenty's Casino Plan

As clocks ticks on session, Canterbury casino still in play

PATRICK CONDON Associated Press

ST. PAUL - Gov. Tim Pawlenty's decision to pull his gambling proposal from consideration in the House doesn't spell doom this session for a proposed casino at Canterbury Park racetrack, its chief supporter said Wednesday.

Rep. Mark Buesgens, R-Jordan, said that in the next few days he would bring the so-called racino proposal directly to the House floor for an up-or-down vote. He hopes for support from lawmakers worried that Pawlenty's decision leaves them $200 million short of what they want to spend on state needs.

Buesgens said a number of lawmakers not comfortable with the major gambling expansion proposed by Pawlenty - the racino and a state-tribal casino, both located near the racetrack - told him privately that they'd support the racino on its own.

"Let's get it through the House, and you have a running chance of getting it through the Senate," said Senate Minority Leader Dick Day, R-Owatonna, a longtime racino backer. He said 27 of his Senate Republican colleagues would vote in favor, meaning it would need support from less than 10 Democrats.

However, Pawlenty himself could be a stumbling block to the racino becoming reality. His chief of staff, Dan McElroy, said this week that the governor would not support a gambling expansion that didn't include participation by interested Indian tribes.

Sviggum said that wouldn't necessarily stop the House from approving the racino. "If you approve it, it becomes another piece that could come up in negotiations," he said.



In Minnesota as elsewhere, standing up to governors is a good idea

Posted: May 19, 2005
by: Staff Reports / Indian Country Today

In America, the Indians are made to pay. Indian property - stolen ''fair and square,'' apparently - has been the fuel of American economy for more than 200 years.

The solution in the minds of politicians and other special interest groups in the various states that contain Native nations is to go after whatever assets and revenues Indian tribal governments and member associations presently hold, and work to impose fees, taxes and any and all manner of tentacles upon such sovereign properties. State governors throughout Indian country are intent on making tribal America fill the gap left behind for the big tax cut cave-in to special interests at the federal level. Everywhere the bite of states - illegal and unwarranted - upon the economic treasure of Indian country grows more ferocious.

The assertion that states have the right to tax the revenues of Indian governments must indeed be challenged at every turn. In Minnesota, Stanley Crooks is one of those who stand their ground.

Crooks stood up quickly when Minnesota Gov. Tim Pawlenty, in an act of political duress if ever there was one, demanded some $350 million in gambling revenues from the tribes for his state's treasury. The feds are failing him, so the Indian tribes must pay. If the tribes don't acquiesce, he threatened to make Minnesota the Nevada of the upper Midwest, throwing the state wide open to state and corporate casino operations.

Crooks, chairman of the Shakopee Mdewakanton Sioux (Dakota) Community, wrote the governor last December: ''There is no reasonable justification for you to demand, or otherwise expect, tribal governments in Minnesota to share any of their gaming revenues with state government.'' In the now-renowned letter, Crooks cited the reigning interpretation of sovereignty-protected Indian gaming as a nation-building enterprise: ''Tribal gaming revenues are for tribal governments and Indian people to use in an effort to address historically dire conditions on Indian reservations. Such conditions persist today in most of Indian country. ''Even with gaming, the tribes have limited resources with which to address the many issues throughout Indian country. On the other hand, state government has ample opportunity and resources available to it to pay for its own responsibilities without having to look to the tribes.''

University of Minnesota Law professor Dr. David Wilkins also weighed in on the governor's arm-wrenching proposal. He shared this 1988 quote from Sen. John McCain: ''The state and gaming industry have always come to the table with the position that what is theirs is theirs and what the tribes have is negotiable.'' He then went on to call Pawlenty's proposals ''attempts to coercively extract $350 million'' from tribes, while their ''present compacts are still good law.'' Pawlenty's arm-twisting tactics would violate the 1988 Indian Gaming Regulatory Act. Wilkins quoted the act: ''Nothing in this section shall be interpreted as conferring upon a state or any of its political subdivisions authority to impose any tax, fee, charge, or other assessment upon an Indian tribe or upon any other person or entity authorized by an Indian tribe to engage in a Class III [gaming] activity.''

While the Minnesota governor touted his squeeze-the-Indians campaign as a ''better deal for Minnesotans,'' Crooks pointed out that ''not all Minnesotans are members of tribes [but] all tribal members here are Minnesotans.'' He pointed to the ''improved lives of over 14,000 Minnesotans, Indian and non-Indian, who are employed by tribal governments and the thousands of others whose jobs are supported by tribal gaming.''

In 2002, Pawlenty promised the Tax Payers League that as governor, he would not raise taxes in a million years. He also promised not to expand gaming beyond Indian casinos. But it is easier to fight with Indians, so he turned on the tribes. Some local columnists now call him ''Big Tim, Indian Fighter.'' As Pawlenty's Minnesota predecessor, the independent Jesse Ventura, put it to a similar-minded governor, Arnold Schwarzenegger of California: ''He promised to balance the budget without raising taxes ... [but] ... I guess it's OK to rip off the Indians.''

The stand by Crooks and others among the economically fortified tribes in the state, while not fully successful to everyone's satisfaction, forced the governor to forward a plan both politically savvy for him yet necessarily advantageous for some of the state's most economically poor northern Chippewa tribes - White Earth, Red Lake and Leech Lake - which would become partners in a metro-area casino.

It is a substantial forward motion when disenfranchised and remote tribes can be brought into the playing game of casino capitalization. And regardless of how the political ball happens to roll on any particular season, it is always a good thing for Indian leadership to stand up against local and state jurisdictions whenever these cross the line and try to limit Indian sovereignty in any way. While no doubt Pawlenty's approach is chapter and verse out of the divide-and-conquer book, it is always a good thing when any Indian community improves its lot. It is also always best to maintain a vigilant and cautious attitude toward every governor of every state. This we fully encourage, as it always tends to bring around better situations and agreements for all tribal peoples who refuse to forget who they are.

Editorial: Time to regroup/Casino bill takes wrong turn

April 28, 2005

It's no wonder that prospects are growing dim for legislative passage this session of Gov. Tim Pawlenty's proposal for joint state/tribal casino in the metro area. In recent weeks, the proposal took some bad turns.

Pawlenty's bill is rooted in a promising strategy, initiated four years ago by three northern Ojibwe bands, for using the state lottery's constitutional authority to allow them to operate a casino in the lucrative metro market. In exchange for the state lottery's involvement, a portion of the casino's proceeds would be shared with the state.

That notion is in keeping with what has been, for more than a decade, the Minnesota consensus on casino gaming. It has been a limited enterprise, available only to the state's native tribes and then only under the terms of compacts negotiated by the state and the tribes in 1989 and 1991. Its purpose has been the economic betterment of a disadvantaged population.

The consensus that casinos should be Indian ventures has been challenged for several years by a push to install a casino at Canterbury Park. Legislative support for a racino draws from a legitimate desire to assist the equestrian industry and spur tourism. But some support also springs from a less noble attitude -- a desire to get white hands on "easy money" now flowing to Indians.

Pawlenty's proposal took its first troubling turn when it called for a large licensing fee -- $200 million -- to be paid by tribal partners in order to initiate the venture. That big number signaled to legislators, fairly or unfairly, that the governor is more interested in casino proceeds than in making gaming a fairer development tool for the tribes.

There was another signal, too: The governor did not close the door to non-Indian casino proposals, including one at Canterbury.

Things became more problematic last week, when a new proposal emerged. It would build two large casinos in Shakopee, one operated by Canterbury, one by the state/tribal partnership. This was not the single-casino venture that some supporters of the tribes (including this newspaper) found acceptable. This was two full-blown, competing casinos.

That proposal breaks Minnesota's Indian-only casino configuration -- and it broke the deal for two of the tribes, Red Lake and Leech Lake. They have backed out of the proposal, leaving the state's largest band, White Earth, still pushing for action this session.

The move by Red Lake and Leech Lake undoubtedly contributed to the vote in the Minnesota House Tuesday that sent the casino bill to the unfriendly House Tax Committee. Meanwhile, senators say, the two tribes' retreat has stiffened the already formidable resistance to any gambling expansion in the Senate.

Given that political reality, the governor would do well to call a retreat of his own. Backing off from a gambling expansion this session would not be the end of the issue. But it would allow time for renewed efforts to develop a more widely acceptable proposal. A new effort should embrace both the disadvantaged tribes and those whose casinos have made them wealthy. Its aims -- in order of priority -- should be a greater measure of economic equity among the tribes; an assurance of a long-term, exclusive casino franchise for native people, and a stream of revenue to the state, comparable to what casinos might pay were they subject to state corporate taxes. Admittedly, attaining those goals won't be easy. But charting the right public policy seldom is.

Minneapolis Star Tribune

Minnesota's Version of "Where did the Indian Go?"

Opinion: By Dave Snetsinger

Fleecing of casino tribes just a new chapter in an old story
By Paul VanDevelder For the Los Angeles Times

On long winter nights beside the Knife and Little Big Horn rivers in Montana, tribal elders sit around story fires and tell their grandchildren legends to help them make sense of the world. It's a time-worn custom, as old as silence.

A black man, a white man and an Indian arrived at the Pearly Gates, begins one of their favorite tales. After welcoming them to heaven, St. Peter invites each man to choose the afterlife of his dreams.

The black man asks for great music and lots of friends. St. Peter grants his wish and sends him on his way.

Up steps the Indian, who asks for beautiful mountain streams, deep forests and plenty of food.
"Say no more, chief," St. Peter says, sending him off.

Last, he turns to the white man and asks, "What do you want heaven to look like?"
And the white man says, "Where did that Indian go?"

Ever since Columbus waded ashore, say the elders beside the Knife and the Little Big Horn, white men in funny hats have been asking, "Where did that Indian go?"


Poll finds three-fifths of Minnesotans favor metro casino

February 6, 2005

MINNEAPOLIS (AP) - A new poll shows about three-fifths of Minnesota adults believe Indian tribes should share casino profits with the state to keep their monopoly on casino gambling.

By about the same margin, the copyright Star Tribune Minnesota Poll shows respondents favor a new casino in the Twin Cities area if part of the profits go to the state's general fund.

The telephone poll of 835 randomly selected adults, published Sunday, was conducted Jan. 23-26. For results based on the entire sample, one can be 95 percent confident that sampling error will be no more than plus or minus 3.4 percentage points.

The poll showed that 49 percent of those polled strongly support Gov. Tim Pawlenty's negotiating with the tribes for more of the profits from their 18 casinos and 47 percent strongly back a metro-area casino, if part of the profits were to go to the state.

Another 13 percent favor negotiating with tribes but not as strongly, while another 15 percent support a metro area casino if part of the profits go to the state.

Twenty-four percent of those polled strongly oppose asking the tribes to share their casino profits and 7 percent oppose the idea, but not strongly. On the question of a metro casino, 21 percent were strongly opposed and 7 percent were opposed, but not strongly.

Pawlenty estimates his casino proposal, unveiled in a budget plan, would bring the state a one-time payment of $200 million in fiscal 2006 and $114 million a year beginning in 2008. The budget deficit for 2006-07 is $700 million.

Partner tribes question Pawlenty casino fee

Posted on Wed, Jan. 26, 2005
PATRICK CONDON
Associated Press

ST. PAUL - The chairman of an Indian tribe looking to build a new casino with the state said that Gov. Tim Pawlenty dropped a big obstacle in the plan's path by calling on the partner tribes to come up with $200 million to get it started.

"If we had access to that kind of money we certainly wouldn't be pitching a casino in the metro area," George Goggleye, chairman of the Leech Lake Band of Ojibwe, said Wednesday.

The White Earth Band of Ojibwe and the Red Lake Band of Chippewa - the other likely partners in a state-tribal casino - also couldn't afford it, Goggleye said.

The chairmen of the White Earth and Red Lake tribes did not immediately return phone calls seeking comment.

Pawlenty's chief of staff, Dan McElroy, said the $200 million figure is "an estimate and certainly subject to being discussed."

The governor's proposal calls for a new casino at a yet-unnamed site in the Twin Cities area. It would be built and owned by the Indian tribes from northern Minnesota that don't currently own large casinos, but the games would be operated by the Minnesota State Lottery.

Pawlenty called the proposal his "Plan B," after the tribes that own large casinos refused to give a portion of their earnings to the state in exchange for a continued casino monopoly.

Under the governor's plan, the $200 million casino licensing fee would be used by the state to help erase a projected $700 million spending deficit even as spending is increased on K-12 education, higher education and other programs.

"We're fully aware the tribes don't have those kinds of resources as cash on hand," McElroy said, suggesting the tribes might have to borrow the money, as they'd likely have to do to pay building construction costs as well.

John McCarthy of the Minnesota Indian Gaming Association, which represents the tribes with large casinos, said that's asking a lot.

"Everyone knows these tribes are financially strapped," McCarthy said.

It again raises the specter, McCarthy said, that private gaming interests would help pay to build the casino and manage it - a move he called "opening the door to Las Vegas."

"It's the beginning of the end for tribal gaming as we know it," McCarthy said. "Once you have Las Vegas here they will never go away. The state will become addicted to gambling money."
McElroy said no decision has been made on the casino's management structure. "There are lots of options," he said.

Goggleye said the tribes want to manage the casino themselves and not hire an outside company to do it.

"The three tribes would rather not go down that road," Goggleye said. "We feel very confident in our ability to manage our own properties. There's plenty of people out there in Indian gaming that are capable of stepping up and taking that kind of responsibility."

Despite the $200 million glitch, Goggleye said the northern tribes are excited about Pawlenty's proposal and are ready to delve deeper into negotiations with the governor's office.

Under the new plan, beyond the initial $200 million licensing fee the state would earn about $114 million a year from the casino starting in 2008.

Goggleye said the yearly state take has always been part of the negotiations - "I'm all for that," he said - but not the licensing fee.

Kevin Washburn, a University of Minnesota law professor and Indian gaming expert, said most Indian tribes spurn outside managers because it means giving up a portion of profits.

Washburn, the former general counsel for the National Indian Gaming Commission, warned the northern tribes to approach Pawlenty's offer carefully. A state-tribal casino partnership is uncharted territory and holds many potential pitfalls, he said.

Pawlenty "was forced into a corner politically and only when he was forced into a corner did he embrace some Indian tribes," Washburn said. "The cost is high to have to join forces with someone who is doing so only out of absolute necessity."