State tries to block Park City casino

Attorney Gen. Steve Six is seeking to halt plans for a Park City casino by the Wyandotte Nation of Oklahoma.

Six has asked the U.S. Department of the Interior to review a 1984 law that allowed the tribe to buy land for gambling in Kansas City and, based on that law, to deny its application to use its Park City land for a casino.

Congress passed the 1984 law after the Wyandotte claimed it never was properly reimbursed for land the government took from it in Sandusky, Ohio, in 1843.

Six contends that the law allowed the tribe to use $100,000 in land-claim settlement money to buy land that could be taken into trust for a casino. He says the tribe used all of that money to buy a former Shriner building in downtown Kansas City for its 7th Street Casino.

The tribe contends that it used $25,000 of the $100,000 provided by the law to buy its land in Park City in 1992, before it bought the Kansas City tract in 1996. That means its Park City land was bought with land-claim settlement money, and the Interior Department must take the land into trust, the tribe contends.

In a Sept. 13 letter to Larry Echo Hawk, assistant secretary of the Interior for Indian Affairs, Six contended the Interior Department has the discretion to deny the tribe's application to put 10.5 acres of land in Park City in trust for gambling.

As he did in a 2008 letter to the department, Six asked Echo Hawk to deny the application, pointing to the 2007 vote in Sedgwick County in which residents rejected casino gambling.

"Such a facility would not only frustrate the will of the people, but would also significantly reduce state tax revenue that could be realized from a state-owned gaming facility operating under state law in an adjacent county" the letter says, referring to a Sumner County casino.

One state consultant has predicted that a casino in Park City would cut into the gambling revenue from a casino in Sumner County by 21.5 percent.

Fear of competition from a Wyandotte casino in Park City has affected contract negotiations between the Kansas Lottery and nervous developers bidding for the Sumner County facility. Last year, the only bidder eventually pulled out, citing the tribal casino as a reason.

That led to a new round of bidding this year. Two developers are competing for the casino, and neither has said it fears the Wyandotte's plans.

Billy Friend, the Wyandotte's second chief, said Six's letter proves he doesn't understand the case.

"The state conceded for 12 years in federal courts that the first $25,000 of that money was spent in Park City, Kansas. So I don't see his argument there," he said.

Friend said the tribe spent $153,000 in Kansas City. It had invested the 1984 money and watched it grow into a large sum over the years, he said.

The Wyandotte's casino in Kansas City was the subject of a legal battle between the state and the tribe that lasted more than a decade. It ended this summer when the U.S. 10th Circuit Court of Appeals sided with the tribe. The state has decided not to pursue the case.

A Sept. 13 letter from Gov. Mark Parkinson notified the Interior Department that the dispute has been settled and the state has agreed to negotiate a Class III gaming compact with the tribe.

A Class III compact would allow Las Vegas-style gaming at the casino, which is operating under Class II, or bingo-based, rules.

Friend said the argument in the courts over the years was whether interest from the tribe's investments on its original $100,000 should count as land-claim settlement money. The tribe won that battle several times during the legal process, he said.

"Two decisions by the Secretary of the Interior concluded that was all land-claim settlement money, and even with the interest involved, we could use that," Friend said.

Six said in his letter that the Wyandotte are trying to use the 1984 law a second time to build its Park City casino.

"If the department accepts the Wyandotte Nation's reasoning, conceivably, it could continue to argue that each additional future purchase was made only with a 'portion' of the (1984 law's) funds, leaving a remainder that could be grown through interest and investment income, and allowing continued purchases of land the Secretary then would be required to take into trust..." Six wrote.

Six cited Interior Department documents, administrative records and prior legal proceedings to claim that the tribe's allotted $100,000 was considered to have been used up when it bought the Kansas City land.

"Once the Shriner Tract was placed in trust, the Wyandotte Nation received the full benefit intended by Congress" from the 1984 law, the letter said.

Representatives in Six's and Parkinson's offices said they have not received a response from the Interior Department.

The tribe's land-in-trust application for Park City remains pending in the department. Friend said it awaits only Echo Hawk's signature.

The Wyandotte have said they plan a $30 million to $50 million first-phase casino development for Park City.