The Ojibwe News / Native American Press (Bemidji, Minnesota), 1998-02-20

              Shooting Star Casino in 'hock' to Detroit
Lakes bank for $6 million
By Gary Blair
The White Earth reservation's
Shooting Star Casino in Mahnomen,
MN has been "hocked" for
$6,000,000.00 inwhatappearstohave
been a secret deal signed off on by
only the chairman and secretary
treasurer of the five-member tribal
council.
The mortgage is with the First
American Bank, National Association
of Detroit Lakes, MN. The agreement
was signed Oct. 30,1997 by reservation
chairman Eugene "Bugger" McArthur
Jr. and secretary/treasurer Erma
Vizenor. The deal includes every part
ofthe casino's operation and is payable
in full by Oct. 1, 2002. The contract,
however, does offer flexible debt
restructuring and repayment options.
Mahnomen county Recorder Veron
E. Otto, registered the Mortgage,
Security, Agreement, Fixture Financing
Statement and Assignment of Lease
and Rents #110563 on Nov. 3, 1997.
Calls to McArthur, Vizenor and the
reservation's attorney Zenas Baer for
comment were not returned by press
time.
The loanagreementincludes: "Waiver
of Sovereign Immunity" and the
reservation consents to be sued in
either United States District Court,
United States Court of Appeals, Eighth
Circuit, and the United States Supreme
Court. "The Mortgagor consents to
be sued in a district court ofthe State
of Minnesota. The Mortgagor hereby
expressly waives the prior exhaustion
of tribal court remedies."
According to wording in the
agreement, if reservation officials were
to default on the loan, the bank could
take over the casino without
notification.
Bernie Sauer, head of business loans
for the Detroit Lakes bank, had this to
say on Thursday about the transaction:
" We were acting in good faith, and we
were under the impression that those
who signed the mortgage had full
authority to do so," Sauer responded
when questioned about the casino
mortgage.
On Jan. 23,1998, McArthur gave the
following answer to whether the
reservation's casino had been
mortgaged. "No - that's not true," he
responded. The conservation occurred
at a restaurant in Waubun, MN, where
he was having lunch with a small group
of people shortly after his heated Jan.
23 censure hearing.
Tim LaPointe, acting area director for
the BIA office in Minneapolis, said
Wednesday that his office was not
informed about the loan. Joel Smith,
superintendent for the BIA agency
office in Cass Lake, also confirmed
Wednesday that he was not aware of
any mortgage involving the White
Earth casino.
Jim Jackson, a candidate for secretary/
treasurer in the reservations upcoming
primary election, said Wednesday that
he will request the U.S. Attorney in
Minneapolis to investigate the
mortgage ofthe reservation's casino.
Roberta Brown, another outspoken
critic ofthe reservation's tribal council
likewise, said that she was asked by a
Minneapolis BIA official to submit a
letter requesting their involvement in
the matter.
Brown's letter, which was faxed to the
BIA on Feb. 18,1998, read asfollows:
Dept. of Interior
Bureau of Indian Affairs
Mpls. Area Office
Attn: Larry Morrin
Acting Area Director
Loan/to pg. 6
Former federal officials later work for tribes
or gaming companies
ALBUQUERQUE, NM (AP) - Since
1995, at least nine former federal
regulators of Indian gambling later
worked for tribes or companies with
interests in the industry.
The officials include fourformer aides
to Interior Secretary Bruce Babbitt and
two former members ofthe National
Indian Gaming Commission, the
Albuquerque Journal said in
Thursday's editions. The federal law
that attempts to limit the practice
specifically allows those representing
tribes to immediately lobby their old
agencies after leaving government
service.
Sheila Krumholz, project director for
the nonpartisan Center for Responsive
Politics in Washington, D. C, said she
was disturbedby the idea of a revolving'
door for the Indian gaming industry.
"The concern would be perhaps there
is too cozy a relationship between the
regulators and the regulated,"
Krumholz said.
The Center for Responsive Politics
issued a report last year showing Indian
gaming tribes in New Mexico and other
states spent millions of dollars on
political contributions and lobbyists.
Krumholz said she fears that regulators
of Indian gaming may not be as tough
as they should be because of the
potential for personal gain after
leaving government.
Former Babbitt aides Tom Collier and
John Duffy have been attacked in recent
months because of their post-
government work for a Minnesota
gaming tribe that benefitted from an
Interior Departmentrulingin July 1995.
"The appearance of impropriety is
very real," Chairman Dan Burton, R-
Ind., said at a hearing last month ofthe
House Committee on Government
Reform and Oversight. The committee
is investigating whether political
influence affected the Interior ruling
that helped the Minnesota tribe later
represented by Collier and Duffy.
Babbitt, in a report in December, said
he couldn't condone the decision by
Collier and Duffy to represent the
tribe.
However, he later told the House
committee the representation is legal.
State-tribal compacts for casino
gambling on tribal land are subject to
Interior Department approval.
The National Indian Gaming
Commission, which is administratively
attached to Interior, has civil authority
to enforce federal laws and regulat ion$_,
on tribal gaming.
Armstrong's memo in support of motion to dismiss, pg. 8
Did Clinton kill the Hudson casino plan?, pg. 4
Letter to Attorney General Reno from Rep. D. Burton,
chairman of govt, reform & oversight, pg. 3
Shooting Star Casino 'In Hock' for $6 million, pg. 1
HZW/ZprBSsoncjpbji.net
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Puerto Rico and Ireland
Wisconsin casino talks move forward with Reservation improves schools through
Mole Lake culture, discipline
(AP) - Progress is being made in the
second of 11 gambling agreements
with Wisconsin Indian tribes that own
casinos, a state negotiator said
Wednesday.
"We expect something to be
happening...hopefully soon,"
Administration SecretaryMarkBugher
said of talks that resume Tuesday with
the Mole lake Band of Lake Superior
Chippewa.
Sunday is the deadline for the state to
give notice that it won't renew the
tribe's seven-year gambling compact.
Last week the state and the Lac Courte
Oreilles Band of Chippewa signed a
five-year compact extension expected
to become the framework for new deals
with the 10 other tribes, the tribe
agreed to pay the state $420,000
annually, beginning in 1999.
Bugher declined to discuss details of
the Mole Lake talks.
Meanwhile, Oneida National Tribal
Chairwoman Debbie Doxtator said that
Governor Tommy Thompson has
become "more flexible" in negotiations,
and that she hopes her tribe can reach
a new deal in a month. The state's
nonrenewal notice deadline with the
Oneida is May 8.
Treaty issues set aside in compact talks
MILWAUKEE (AP) - Gov. Tommy
Thompson agreed to set aside some
issues that American Indians felt
should not be a part of negotiations
over new casino agreements, an aide
says.
As a condition of compacts that
authorize gambling on reservations,
Thompson had proposed the tribes
make concessions on their claims to
natural resources and regulation of
the environment. The governor will
continue to press some non-gaming
issues like environmental powers and
tax issues but will not ask tribes to
make concessionsin theirtreaty rights,
chief of staff John Matthews said.
The seven-year compacts under
which the state allows commercial
gambling on reservations begin
expiring in a few months. The first to
expire belonged to the La Courte
Oreilles Chippewa. The governor
signed an agreement with them Friday,
allowing the band to continue its casino
business for at least five years. The
agreement requires the Lac Courte
Oreilles to pay the state at least $420,000
a year. In exchange, Thompson
dropped some issues including off-
reservation spearfishing.
The agreement is a precedent for
other tribes, said Minneapolis lawyer
Mark Jarboe who represents more than
30 tribes in several states. "This just
strengthens the whole tribal
argument," he said. "If tribe A is
allowed to stay open, I don't see how
a court would shut down the others,"
he said. Federal law lets a tribe offer
casino games if any person,
organization or entity in its state is
allowed to operate similar games, he
said. Because the agreement signed
by Thompson and Lac Courte Oreilles
Treaty/to Pg 3
Newly flush with cash, tribes seek greater
political power
WASHINGTON (AP) - Indian tribes,
some newly flush with cash, are taking
on a greater role in politics by lobbying
against measures they say would
trample their rights, making campaign
contributions and mounting public
relations campaigns to boost their
image.
"We used to go to war on the horse
with the bow and arrow," said Beverly
M. Wright, chairwoman of
Massachusetts' Wampanoag tribe of
Gay Head, which hopes to break
ground on a high-stakes bingo hall in
Fall River this summer. "We go to
war now with a fax, a portable
telephone and a briefcase," Wright
said. "We have to play the game the
way everybody else is playing it."
Tribes like the Wampanoag say that
money - often made from gaming
enterprises - holds the key to greater
political power.
With money, tribes can hire lobbyists
and lawyers, open offices and hire
staff, travel more frequently to meet
with federal officials and other tribal
leaders, and make political
contributions. The point? To be ready
to defeat legislative proposals, such
as taxing Indian revenues or reducing
federal aid to tribes, that Indians believe
infringe unjustly on their sovereign
rights. "In past years, we didn't know
about legislation coming up, we were
always catching up," said Keller
George, a memberof the men's council
of New York's Oneida nation, which
runs the Turning Stone casino between
Syracuse and Utica.
Now "we're playing offense," he said.
Indian groups, includingthe23-member
United South and Eastern Tribes, of
which George is president, are meeting
with members of Congress more
frequently and passing out briefing
books on Indian issues to new
members. Last week, USET held a
seminar on tax issues for congressional
staff. Sometimes even seemingly
parochial measures can be a call to
action.
Many tribes, for instance, want
Congress to repeal a provision, added
RED LAKE, Minn. (AP) _ After
repeated warnings, they finally kicked
Danielle Hart out of her middle school
class. Danielle admits she was a
troublemaker.
The Red Lake school board pulled
her out and assigned her to the middle
school's alternative learning center.
There she met Grandma, and Grandma
straightened her out. Mary Black is
the learning center's 75-year-old foster
Grandma.
At the learning center, difficult
students get a good dose of discipline
and personal attention. Grandma's job
is to help the wayward students with
their assignments and to give them a
little grounding in Indian history.
"I tell them about the old times long
ago, about my life. I learned a lot of
things from my grandma and my ma,"
Black said. "These kids call me
Grandma. Hike that."
Now, Danielle is eager to get back to
class and prove that she can behave.
She believes Grandma taught her the
self-discipline she needs to succeed.
The Red Lake School District is trying
to take a new direction as it recovers
from a troubled recent past. The
schools, especially the high school,
once had a notoriety for ill discipline
and poor attendance.
Now, with anew middle school facility
and new discipline policies, the fight
count is down from 68 in the 1995-96
school year to just four so far this year,
according to Al Yarrtott, middle school
principal. "It's a good place to be. It
wasn't always that way," Yarnott said.
"It came together with the staff and the
community, and we're just not having
Discipline/to pg. 3
Muscogee (Creek) national wins initial court
battle in tobacco suit
OKLAHOMA CITY (AP) - One of
the ironies in the Muscogee (Creek)
Nation's lawsuit against the tobacco
industry is that the tribe makes a lot of
money from the sale of tobacco
products, an industry lawyer said
Friday.
"The Muscogee tribe is heavily
dependent on the economy in tobacco
for its livelihood," John Phillips, a
lawyer representing Philip Morris,
said in a telephone interview. "It is the
regulatory monopolist for tobacco
within the Indian nation. If you want
to sell tobacco, it has to be done within
the tribe. It's an enormous source of
income." Be that as it may, the attorney
for the tribe said, the Muscogee
(Creek) Nation has the right to seek
"addiction compensation," or
reimbursement of the money it has
spent to treat sick smokers.
The amount of damages being sought
in the lawsuit has not yet been
determined, but the attorney said it
would be "in the tens of millions of
dollars."
The tribe claimed a victory in court
Thursday. Judge Patrick E. Moore, of
the Muscogee (Creek) Nation's
Okmulgee district, ruled that tribal
courts have jurisdiction to hear
tobacco lawsuits brought by tribes.
The tobacco companies had argued
that, based on 19th century treaties,
tribal courts could not have jurisdiction
because the companies did not operate
businesses on tribal land and were not
American Indians.
Among the companies named in the
lawsuit are Philip Morris, American
Tobacco Co., R.J. Reynolds and U.S.
Muskogee/to pg. 5
Babbitt tells interior employees he'll fight
allegations
Cash/to pg. 3
WASHINGTON (AP - Interior
Secretary Bruce Babbitt promised
Friday to fight allegations he lied to
Congress and blamed his problems on
"a corrosive, antagonistic, bitter
culture that has settled overthis town."
Several hundred employees greeted
Babbitt with sustainedapplause as he
arrived at the department auditorium
to discuss the investigation of charges
that he misled Congress in connection
with a proposed Indian gambling
license.
"Here 1 am ... and here I'm going to
stay," the secretary declared. "... I'm
going to fight this out to the bitter end
and we will be vindicated."
Attorney General Janet Reno asked a
three-judge panel Wednesday to name
an independent counsel to investigate
allegations that Babbitt misled
Congress in his explanations
concerning the Interior Department's
1995 rejection of a casino license for
three Wisconsin Indian tribes.
Addressing Interior employees for
the first time since Reno's decision,
Babbitt said he was perplexed about
the need to name a special prosecutor
when the casino issue already had
been investigated by two congressional
committees and the Justice Department.
"There is a corrosive, antagonistic,
bitter, embattled culture that has settled
over this town," said Babbitt. "... In
this culture of this town... the facts are
not enough."
On Friday, Reno asked a federal court
in Wisconsin to halt a civil lawsuit
brought against Babbitt by the tribes
that were denied a casino license until
an independent counsel can advise
Babbitt/to Pg. 5