Lawmaker says Pawlenty budget plan to use Indian gaming funds amounts to extortion

Wednesday, January 26, 2005

By Brad Swenson
Staff Writerbswenson@bemidjipioneer.com

Gov. Tim Pawlenty’s pitch to use $200 million from American Indian gaming amounts to extortion, says state Rep. Frank Moe, DFL-Bemidji.

Pawlenty, in his 2006-07 biennium budget released Tuesday, called for a new tribal-state gaming partnership.

While the budget speaks of working with “interested” tribes, Pawlenty has been actively working with the Red Lake, Leech Lake and White Earth bands of Chippewa in a partnership to locate a casino in the Twin Cities area.

Under the budget proposal, those tribes that agree to participate in an optional compact would be eligible to be partners in a single metro area casino. There would be an initial licensing fee by “the managing entity” to the state of $200 million in 2006.

After that, the state would receive annual revenues of about $114 million, starting in 2008.
“I believe the northern tribes will have nothing of it,” Moe said Tuesday night. “They should not mortgage their tribes to bail out the governor.”

The stumbling block, Moe said, is the upfront $200 million “licensing fee.” Pawlenty wants the tribes to form a corporation, borrow the fee and pay the state even before the first slot machine is pulled, he said, adding the Republican governor believes the tribes can get their investment back eventually through gaming.

“He wants the tribes to borrow the $200 million,” Moe said. “It’s a bad idea for the northern tribes, and I hope the tribes won’t bail out the governor.”