Casino News

April 17 2004:

Compared to the flashy, multimillion dollar riverboat gambling palaces that dot a handful of Missouri River banks across the state line, it's a wonder the 7th Street Casino -- which had no gourmet restaurants, no hotel, just 150-some bingo machines that looked and played like slots -- was making any money at all.

But state and local officials raised a stink when the Wyandotte Nation of Oklahoma opened the casino and finally shut it down earlier this month. The tribe is fighting tough in federal court to reopen its doors.

The reasons, of course, come down to money, and the potential to make so much more than what was passing through the cages at the little casino across from City Hall.

For the Wyandotte Nation, the 7th Street Casino is a both a negotiation tool and a homestead of sorts, a claim that it hopes to develop into one of those flashy, multimillion dollar gambling palaces that brings in millions of dollars every year.

For state officials in favor of expanding gambling, it's a potential impediment to their plan to plant a state-owned "destination" casino in the county, or negotiate what's likely to be a better deal with another tribe. Either option could reap millions in tax dollars for a stressed state budget.

"The time is right for a casino in Kansas City," said Matt All, the chief counsel to Gov. Kathleen Sebelius, who said the state initially is interested in just one destination casino in the Kansas City area. "The market is there; the local will is there. When you think about what has happened in that area during the past few years, it has been a renaissance."

The arrival of Kansas Speedway and the surrounding development, which includes a water-park hotel and massive retail stores, has increased interest in building a casino in Wyandotte County, considered one of the most lucrative untapped gaming markets in the Midwest, said Jason Hodges, the tribe's spokesman.

Government officials estimate the value of the market at between $100 million and $250 million annually; tribal officials believe it could be worth at least twice that.

The tribe has been working for nearly a decade -- initially with the support of local officials -- to open a casino in the county, even pressing a claim, based on treaties from the 1850s, to a tract of land that includes a General Motors plant and hundreds of homes to gain leverage in their legal fight.

"The Wyandottes have tried everything they can think of to get a casino open," said Don Denney, a spokesman for the Unified Government of Wyandotte County and Kansas City, Kan. "We were there with them for a good potion of it. But then when they chose their somewhat questionable, creative ways, we sort of parted ways."

But with the 7th Street Casino, tribal attorney David McCullough thinks they might have finally succeeded.

"We have a casino there," McCullough said. "The state just shut it down. An illegal action of the state doesn't mean we don't have a right to a casino there."

McCullough said the Wyandottes were "staking our claim" when they opened the casino last fall in downtown Kansas City, Kan. It sits on a portion of the thousands of acres of land the Wyandotte tribe acquired from the Delaware Nation in the mid-1800s -- land the state is arguing in federal court no longer belongs to the tribe.

No other American Indian tribe has reservation land in Wyandotte County, meaning they would have to have land taken into trust before opening a casino. But a federal law and regulation requires consultation of other tribes within a 50-mile radius of such an acquisition.

McCullough said the Wyandottes would use the provision to try to stop other tribes from opening a casino in the county, asserting the Wyandottes have a casino in the area already and another one would hurt it economically.

All called the tribe's argument illogical.

"You can't put up an illegal casino and say, 'No one else can game because we have a casino,"' he said.

Only American Indian tribes and the state can own a casino under the Kansas Constitution, and letting the Wyandottes open a casino in the county is not an attractive option for the state.

Because the Wyandottes tribe is based in Oklahoma, money generated at their casino would flow out-of-state. And negotiating compacts with the Kickapoo and the Sac and Fox tribes, which already operate separate casinos in northeast Kansas, would yield a much better deal.

Currently, those tribal-owned casinos pay little to the state, All said. In exchange for a deal to operate a Wyandotte County casino, the state is seeking a cut of those existing casinos' profits as well as a portion of the profits generated by a new casino.

Even as negotiations with the Kickapoo and the Sac and Fox tribes continue, Sebelius and others in Topeka remain committed to a proposal authorizing up to five state-owned casinos. Under that plan, tribal and non tribal developers could compete for the lucrative contracts to manage the casinos.

While Sebelius is "cautiously optimistic" the measure will pass during the current legislative session, an aide said, others at the Statehouse are not so sure. That could leave the tribes as the only immediate option.

And the Wyandottes are prepared to continue their fight. They filed an appeal Friday of a federal judge's decision denying a request for a temporary restraining order that would have kept the 7th Street Casino open.

McCullough said he isn't worried the tribe's continued efforts in court to keep their casino dream alive could make enemies.

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