State audit: Gaming profits up

Casino revenue jumped 29.1 percent for Wisconsin tribes during the last five years, exceeding $1 billion for the first time in 2004, according to a state audit released Wednesday.

The Legislative Audit Bureau also found gaming profits for the 11 tribes that run 17 casinos in the state rose 23.3 percent, from $418.7 million to $516.3 million from 2000 to 2004.

The state can't release figures for individual tribes under terms of gaming compacts, and profit levels varied by tribe, auditors said.

The audit showed tribal gaming payments made to the state also increased, jumping from about $25 million in 2003 to $69.6 million in 2004. But the 2004 payment total is about $30 million short of initial projections because the Ho-Chunk Nation has not made its payments in a dispute over the meaning of a 2004 Wisconsin Supreme Court decision, according to the audit.

Auditors warned legislators that predicting future gaming revenue will be difficult because of the controversial court case and because of the way new compacts are written. Payments are now based on net revenue instead of a lump sum, and the deadline for payments isn't exactly clear under some compacts, auditors said.

State representatives on Wednesday approved a 2005-07 state budget that relies on about $120 million total in payments from the Ho-Chunk by July 2007, said Bob Lang, director of the Legislative Fiscal Bureau.

But it's not clear how much in Ho-Chunk payments will come in, as the state renegotiates compacts reached by Gov. Jim Doyle and 10 tribes, including the Ho-Chunk, in 2003.

The Ho-Chunk runs a casino along Hwy. 12 near Baraboo and the Majestic Pines Casino in Black River Falls. The state last week entered a formal six-month arbitration process with the tribe to sort out a 2003-05 payment dispute, said Sean Dilweg, and aide to Doyle.

The state Supreme Court ruled in May 2004 that Doyle exceeded his authority in offering expanded games and compacts that would never expire to the Forest County Potawatomi, which runs a casino in Milwaukee. Although not a party to the lawsuit, the Ho-Chunk Nation decided not to offer the expanded games, such as craps and roulette, and to stop payments to the state.

Republican legislative leaders, who sued Doyle over reaching the Forest County Potawatomi deal without their approval, are counting on Doyle to get the money, said Assembly Speaker John Gard, RPeshtigo.

"At this point, we'll take the governor's word that someone's going to pay," Gard said.

The audit reveals tribes are earning more money from gambling operations but payments aren't keeping up, Gard said.

The fight between Doyle and Republicans over tribal gaming is expected to continue today, as the state Assembly considers a Gard introduced bill that would attempt to prohibit Doyle from approving "off-reservation" casinos without legislative approval first.

Under current law, only the governor has to concur with the U.S. Secretary of the Interior to allow casinos on tribal lands taken into trust after Oct. 17, 1988, according to the Legislative Reference Bureau.

Gard's bill my run into conflict with federal law, Dilweg said. Casino proposals are pending on off-reservation land in Kenosha, Beloit and Shullsburg.

Doyle already has vetoed bills that would have given the Legislature authority to approve gaining compacts, said Melanie Fonder, a spokeswoman for the governor.

Copyright La Crosse Tribune Jun 23, 2005
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