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State-run casino plan derailed at Capitol
by Michael Khoo, Minnesota Public Radio
April 1, 2003

State lawmakers on Tuesday dealt a significant blow to a proposed metropolitan casino to be operated jointly by the state and northern Indian tribes. The House Government Operations Committee voted 10-8 against the plan, making it unlikely the measure can pass this year. Representatives of the White Earth and Red Lake Indian tribes had stood to gain millions of dollars in gambling revenues from the project. But the state's other tribes viewed the plan as an encroachment on existing casinos.

St. Paul, Minn. — Members of the White Earth and Red Lake Tribes argued that the economic boom enjoyed by other tribal casino operations had passed them by, due in part to their remote northern locations. The two tribes argued a partnership with the state to open a Twin Cities casino would level the playing field and generate much-needed development funds.

White Earth Reservation Chair Doyle Turner says the committee's no-vote would be difficult to explain back home. "It means a setback for us, for our plans and our hopes. We had a lot of people that are waiting back home, waiting for the results of this committee hearing that are going to be be very disappointed."

Unemployment levels on the two tribes' reservations hover at or above 40 percent. Although committee members sympathize with the plight of the two bands, lawmakers have historically been reluctant to expand gambling opportunities.

Rep. Bill Hilty, DFL-Finlayson, argued that the state has no business entering the gaming industry, suggesting that lawmakers should seek a more traditional approach to economic development.

"We want to help them, but we don't want to pay for it. So we want to have somebody else pay for it. And that's what raising revenues through gambling is really all about. We first make the decision that here's something that's worth having. And then we make the second decision that it's not worth paying for," he said.

The casino proposal was also vigorously opposed by the state's other nine Indian tribes. John McCarthy, who represents the Minnesota Indian Gaming Association, says a new casino in the Twin Cities would draw business away from existing operations, thereby undercutting the development dollars of other tribes.

McCarthy says he understands the need for development on the White Earth and Red Lake reservations, but he says expanding gambling wasn't the answer.

"It's never easy to have to deal with that kind of an issue. But I do believe that what prevailed here was the understanding that this is the State of Minnesota that is getting involved in an issue that expands gambling well beyond where the Indian reservation gambling has gone before," he said.

Nevertheless, other gambling proposals remain alive at the Legislature. The same committee that crippled the northern tribes' legislation last week forwarded a measure to allow video slot machines at the Canterbury Park racetrack. The so-called "Racino" bill is now under review in the House Taxes Committee.

No vote has been taken, but Canterbury Park President Randy Sampson told tax committee members the package would spread its benefits across the state.

"There is strong support for this proposal in the public, and strong demand for the increased gaming options at Canterbury Park. Number two, the proposal will help keep horse racing at in Minnesota and at Canterbury Park competitive and viable. And number three, the proposal provides significant benefits to Minnesota in terms of a new revenue source, new jobs, and economic development," according to Sampson.

Like the northern tribes' package, the Canterbury casino would be operated by the State Lottery and revenues would be divided between the state and the casino partners. In the case of the Racino, the state stands to gain $75 million a year. Canterbury Park would get about $80 million a year, with a portion of that dedicated to local governments and to higher purses for horse races.

A third gambling proposal is also awaiting its first hearing. That bill would propose a constitutional amendment to allow a privately-operated casino. So far, the Senate hasn't considered any of the gaming proposals.

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