Thursday, July 2, 2009

Tribes In The Media: Shinnecock Tribe Subject Of N.Y. Gaming Conference

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This installment of The Tribes In The Media is an article on the Shinnecock Indian Nation and covers some modern history on gaming in New York. The article was in The Southampton Press. Note that the article incorrectly says that G. Michael Brown "helped both the Mashantucket Pequot and Mohegan tribes negotiate the long and labyrinthine routes to building their respective casinos assisted both the Mashantuckets and Mohegans in their casino development." Mr. Brown was not involved with the Mohegan Tribe.

Shinnecocks still face obstacles in casino bid
By Michael Wright
The Southampton Press
July 1, 2009

The Shinnecock contingent at the New York Gaming Summit in Saratoga Springs last week.

The settlement of a key portion of a legal battle between the Shinnecock Indian Nation and the U.S. Bureau of Indian Affairs fed widespread speculation that the Shinnecocks and their Detroit-based financial backers are now on a fast track to opening a gaming facility in New York City or on Long Island.

But even though a court-ordered ruling on the tribe’s federal recognition application—the key step to gaming rights—is due by December, and the tribe could get the federal go-ahead by mid-2010, many in the New York gaming industry say the hurdles the Shinnecocks face are numerous, and significant.

At a gaming industry conference in Saratoga Springs last week, a host of industry veterans and members of other Native American tribes from around the state said—often with wry smiles—that they’re not holding their breath for a Shinnecock casino to open. Nonetheless, the tribe and its prospects for a casino on Long Island, or in the shadow of New York City, were a popular topic of conversation.

The tribe sent a 10-member contingent to the New York Gaming Summit, including Michael Malick, co-owner of the Detroit-based casino development company that has been funding the tribe’s legal battles over its gaming future since 2003. Also at the conference were the five salaried members of the tribe’s gaming authority, Tribal Trustee Fred Bess, former Trustee Lance Gumbs—who has been the most vocal member of the tribe in the casino effort—and at least two of the tribe’s attorneys.

In his keynote speech at the two-day conference, John D. Sabini, chairman of the New York State Racing and Wagering Board, focused on the Shinnecock casino bid, and the speculation the court settlement spawned. And in his remarks he seemed to warn the Shinnecocks that other tribal and private gaming prospects have seemed imminent in the past, and ended up languishing for decades.

“There are no sure things in gaming,” Mr. Sabini said in his speech. “This involves a lot of moving parts. It’s don’t think it’s a slam dunk that they even get federal recognition from the Bureau of Indian Affairs and Department of the Interior.”

Among the moving parts that will mostly likely be required for the Shinnecocks to secure a casino are the federal recognition process, which, though truncated by the court settlement, still poses some substantial pitfalls; identifying a suitable site for a casino and convincing local governments and residents that it suits their interests, financial and otherwise; negotiating with the state for a compact that would allow the tribe to develop something more than the smaller video gaming facilities tribes are entitled to once they are federally recognized; and, perhaps finally, acquiring a piece of land and putting it into federal trust so that it could be used for a casino.

Any or all of those steps could snag the tribe’s efforts.

“Some newspapers said [the court settlement] would mean they have the inside track for Belmont. There’s so much between here and there,” Mr. Sabini said, of a report that the tribe had expressed interest in a gaming facility adjacent to the Nassau County horse racing venue. “[State Assembly Speaker Sheldon] Silver has been clear—he doesn’t want gaming there. And it’s not a sure thing that a land swap deal will be successful.”

He nodded to the cautionary tales told by the leaders of three other Native American tribes—the Seneca, Oneida and St. Regis Mohawks—all of whom have had federal recognition for years, even decades, and are still fighting to get approval for casinos that they thought would be open for business years ago.

The Seneca do operate three relatively small casinos in the Niagara Falls area, but had plans for grander developments in the Catskills region that have been held up for years by a variety of obstacles. The St. Regis Mohawks have federal recognition and a compact with the state to open a casino in Sullivan County, just west of New York City, but were derailed during the effort to transfer land there into federal trust because federal officials felt the location was too far from the tribe’s native lands near the state’s northernmost Canadian border.

In 2005, the Sullivan County Legislature held a vote on whether the county could support five casinos. The legislature said yes, the economically depressed former resort community would happily welcome five tax generating casinos. To date, there are none.

“The Shinnecocks have a long way to go,” said John Tahsuda, a consultant to Native American tribes on a variety of dealings with federal and local authorities, particularly gaming. “It’s going to be interesting to see how it goes for them. In my experience, it is the local opposition that poses the biggest obstacle once a tribe has federal recognition, but there have been many ways in which problems have arisen.”

G. Michael Brown, an attorney who helped both the Mashantucket Pequot and Mohegan tribes negotiate the long and labyrinthine routes to building their respective casinos in Connecticut—now two of the world’s largest such facilities—agreed that the Shinnecocks’ biggest foes in the fight will likely be from local residents and officials in whatever area they choose to build in. He said it seemed as though the tribe had done a good job thus far reaching out to local governments in Suffolk County, but no matter where a casino is going there will always be issues.

Mr. Brown admitted that, for exactly those reasons, the Aqueduct Racetrack in the Ozone Park section of Queens would perhaps be the tribe’s smoothest route to a casino, if timing allows it. The State Legislature has already approved gaming at Aqueduct through the use of up to 4,500 video gambling machines, also known as VLTs, at the Aqueduct racetrack. The surrounding community is supportive of the bid to place a casino, or “racino” as the new supplements to horse racing are called, at the track.

In 2007, shortly after the state opened bidding on the Aqueduct gaming contract, the tribe proposed a $1.4 billion casino and hotel adjacent to it. A recent state Court of Appeals ruling seems to have expanded the legal definition of VLTs to include roulette wheels, baccarat, table games like craps and even, possibly, some forms of the card game blackjack, according to Bill Murray, the deputy director of the New York Lottery, which will license any future gaming operations at the racetrack. That plays into the hands of developers looking to bill the Aqueduct development as a full-fledged casino.

But at last week’s conference, Mr. Murray said that the state is close to deciding on which of the seven official bidders for gaming there will win the contract. The Shinnecock are not on the list of bidders, which includes the Mohegan tribe and billionaire Las Vegas developer Steve Wynn, since they do not have federal recognition. Mr. Murray said the decision on the contract is expected to be made in a matter of weeks, which would appear to effectively eliminate the tribe from contention.

Shinnecock Tribal Trustee Fred Bess acknowledged the looming countdown on Aqueduct, but turned a bit of the naysayers’ own warnings back on them. “Things take a long time to happen,” he said, with a smile and a thoughtful roll of his head. “Once we take care of our federal recognition application, we’ll see where things stand. It’s in the governor’s hands. I think we’re still players.”

The Shinnecocks met with Governor David Paterson when he was lieutenant governor to discuss their gaming hopes.

State representatives of the areas surrounding Belmont Racetrack have also introduced proposals to allow gaming—a potential tax revenue bounty—in their backyard, but Mr. Silver, the State Assembly speaker, who represents Lower Manhattan, has sworn he will never support gaming at Belmont.

Lance Gumbs, who has been at the forefront of the tribe’s casino effort since it first became public in 2001, said the Aqueduct property is huge and ideal for casino development because of its proximity to the city. The Belmont property is much smaller, he said, and the specter of the political opposition sworn by the powerful Mr. Silver in the State Legislature makes it a long-shot prospect for a Shinnecock gaming operation.

Mr. Bess said that even Sullivan County, on the southern edge of the Catskills, just 40 minutes west of Manhattan, is a possibility for a Shinnecock casino. At the gaming conference, Sullivan County Legislator Leni Binder railed against efforts by downstate lawmakers to bring new gaming facilities, and their economic and tax benefits, into the metro area. The county still has compacts with the state for casinos there but has lost its developers. A Shinnecock casino likely would be welcomed with open arms.

“I would love to accommodate her,” Mr. Bess said of Ms. Binder’s plea for an economic boost for her county.

But the same federal obstacle that tripped up the St. Regis Mohawks’ plans in Sullivan County may block the Shinnecocks from crossing the Hudson River. A 2008 edict from the BIA, called the “commutability guideline,” places increased scrutiny on any tribal proposals for a casino a long distance from its home reservation, because such operations would be disruptive to the tribal community, whose members might be forced to relocate for jobs in the industry.

Mr. Bess scoffed at the restriction, saying that employing tribal members at a casino was not the mission, and few, if any, would have to commute or move to the location where the casino is built. “To me, it’s not so much about our working there, it’s about our people benefiting from the revenue,” he said. “It’s about education, and medical care, and roads and housing.”

Several speakers at the conference referred to hopes that President Obama’s administration would be more supportive of Native American gaming proposals. While many felt that the Bush administration was overtly hostile toward Indian gaming—with policies like the commutability guideline—Mr. Tahsuda said there is promise in Mr. Obama’s administration.

The president has already taken a positive step in the eyes of the Indian gaming world by filling a cabinet post that President Bush left vacant for most of his term with a Native American. Larry Echo Hawk, a former Idaho state attorney general, was recently sworn in as the Department of Interior’s Assistant Secretary for Indian Affairs. Mr. Echo Hawk’s cousin, Walter Echo Hawk, is an attorney for the Native American Rights Fund, a group that has been assisting the Shinnecocks in their federal recognition bid.

Mr. Tahsuda said, in a conversation with Mr. Gumbs during a break in the conference, that a pending casino proposal in Arizona will be a litmus test for how the BIA will treat gaming proposals in the coming years.

“We’re going to learn a lot in the next year,” he said. “It’s going to be interesting.”