Casino tribe - political players

The Spirit Mountain casino's success has allowed the Grand Ronde tribe
to inject big money into Oregon elections

Political analysts say the Grand Ronde's aggressive stance delivered a message beyond the primary. The tribe wants to be viewed as a heavyweight in Oregon politics, much like other tribes across the nation that have been enriched by gambling profits.

"If you cross us, you're going to get pulverized," was the message Warm Springs tribal consultant Len Bergstein drew from Grand Ronde's spending.

The Spirit Mountain casino's success has allowed the Grand Ronde tribe to inject big money into Oregon elections

Life is sweeter for the Grand Ronde tribe since it opened Spirit Mountain casino west of Salem in 1995.

Gambling profits pay for universal health care for tribal members, elder housing, pensions, preschool, college scholarships and yearly checks of $4,700 to each member.

And there's enough left over for the 5,500-person tribe to become a big-money player in Oregon politics.

In the May primary for governor, the Confederated Tribes of the Grand Ronde saturated TV airwaves with ads pummeling Gov. Ted Kulongoski for supporting a competing casino proposed in the Columbia Gorge and praising Republican Ron Saxton for opposing that casino.

If the Grand Ronde tribe repeats the $800,000 ad campaign in the fall general election, it could tip the race to Saxton and hand Republicans their first Oregon governorship in two decades.

"It's clear that they are the most powerful interest group on the scene right now," said James Moore, a political scientist at Pacific University in Forest Grove. "They have supplanted labor unions, and they have supplanted the anti-tax crowd. Watching the way they flung money at the TV screen during the primary, I have no doubt that they will continue to be the most powerful interest group in the fall."

Cheryle Kennedy, the Grand Ronde tribal chairwoman, is one of seven registered Democrats on the nine-person tribal council. But Kennedy said the Democratic governor broke a promise from his 2002 campaign, when Kulongoski assured tribal elders that he opposed the off-reservation casino in the gorge proposed by the Warm Springs tribe.

"For us, it's really business," Kennedy said of the Grand Ronde's attempt to influence the governor's race. "It's regrettable that someone with the stature of the governor would choose to say one thing and do another."

Moore and other political analysts doubt that the Grand Ronde spending spree determined the winners of the Republican and Democratic primaries for governor. However, Republican Kevin Mannix said the ads attacking him and praising his GOP rival Saxton made it hard to get his political footing and define himself for voters.

Kulongoski was forced to part with hundreds of thousands of dollars in late spending to offset Grand Ronde ads, which labeled him a "do-nothing governor," to protect his primary lead over Democrat Jim Hill.

"If you cross us, you're going to get pulverized," was the message Warm Springs tribal consultant Len Bergstein drew from Grand Ronde's spending.

For the past decade, since Oregon tribes reaped new money from casinos, the Grand Ronde tribe has accounted for more than half the state campaign donations by Oregon's nine tribes, according to the Money in Politics Research Action Project.

Grand Ronde spending in the 2006 primary -- coupled with 2005 "issue ads" attacking Kulongoski that don't have to be reported -- were six times what the Grand Ronde spent for the entire 2004 election cycle, according to campaign finance reports filed with the state Elections Division.

"You have to include the Grand Ronde as one of the players now," said Democratic political consultant Roger Gray.

The Grand Ronde tribe has not yet charted its political strategy for the general election, Kennedy said. But the tribe will continue its legal, political and public-relations offensive against the Columbia Gorge casino and any other casinos that might supplant Spirit Mountain as the one closest to Portland.

"Will we continue to raise awareness on this issue? Absolutely," said Justin Martin, a Grand Ronde tribal member and lobbyist.

Kennedy personally supports Saxton in the governor's race, saying the incumbent has failed to deliver on education and other issues.

Kennedy brushed off Saxton's disparaging remarks in the primary about the Endangered Species Act. His remarks run counter to traditional Native American values, and that's something the tribe will just have to educate Saxton about, she said.

"We're just like any other kind of competing industry here," said Leon "Chips" Tom, a Grand Ronde elder.

Tom, who lives in the tribe's new elder-housing development and has a shiny metal fishing boat in his driveway, also is a Democrat who favors Saxton in the governor's race.

The Grand Ronde tribe doesn't release Spirit Mountain revenue and profit figures. However, it expects to dole out $5.4 million in charitable donations this year via its Spirit Mountain Community Fund, said Shelley Hanson, the fund director. Under its compact with the state, which spells out terms of the casino operation, the tribe gives 6 percent of its gaming profits to the community fund.

Kulongoski signed a new compact in late March that enables the tribe to put 33 percent more slot machines and gaming tables at Spirit Mountain. Those could boost profits to $120 million per year.

That puts the casino in league with some of Oregon's top corporations. Tektronix reported $82 million in net income for 2005. Columbia Sportswear reported $131 million.

The tribe recently surpassed $30 million in cumulative charitable donations by its community fund. That means the tribe has earned more than $500 million in gaming profits.

Tribal leaders say it's not easy to undo the effects of two centuries of oppression by white settlers and the U.S. government.

The original tribes now assembled into the Confederated Tribes of the Grand Ronde were terminated by the federal government. Before tribal status was restored in 1983, Grand Ronde holdings consisted of a small cemetery and a few acres of adjoining land.

In the early days, the tribal council met in a tiny modular building at the cemetery. Now it meets in an impressive wood-paneled governance building that would be the envy of many midsize Oregon cities. Nearby there's a health clinic, an education center, powwow grounds, elder housing and other facilities.

Tribal members still face high rates of high-school dropouts, alcoholism and diabetes, plus unemployment levels worse than the state average, Martin said.

Providing health insurance to every member cost the tribe $16 million in 2005, said Siobhan Taylor, a tribal spokeswoman. Annual checks to tribal members, which have averaged $4,700 per person, cost the tribe $23 million last year, she said.

With the benefits from Spirit Mountain, it's not surprising the Grand Ronde tribe is fighting tenaciously to remain the casino closest to Portland.

Kulongoski was reluctant to expand gambling earlier in his political career. As attorney general, he supported then-Gov. John Kitzhaber's policy of allowing one casino per Oregon tribe, only on reservation land.

During endorsement interviews in the 2002 elections, Grand Ronde leaders said then-candidate Kulongoski opposed a new casino in the gorge proposed by the Warm Springs tribe.

"We supported Kulongoski. There's a reason why," Martin said. "He was proud of the fact that he actually authored the Kitzhaber policy."

Kulongoski gave similar assurances to the Friends of the Columbia Gorge, said Michael Lang, the environmental group's conservation director.

"We were confident, based on our board members' conversations and other public statements from Kulongoski, that he would maintain that policy and oppose a gorge casino," Lang said.

In a March 2003 meeting, two months after Kulongoski took office, "it was evident to us ... that something was changing," Lang said.

The governor began talking about the need for Warm Springs economic self-sufficiency, he said.

In an interview Tuesday, Kulongoski said he supported the Kitzhaber policy during the 2002 campaign.

"One casino per tribe on reservation land. That was the deal," Kulongoski said. "I wouldn't be surprised if I told them I didn't have any reason to change my mind," he said.

Kulongoski can make that rhetorical claim because the Warm Springs have owned reservation land in Hood River for more than a century.

The Warm Springs publicly proposed a casino there in 1998. After an outcry from residents and local officials, the tribe suggested an alternate site in Cascade Locks, less than 20 miles west of Hood River, later that year.

The Cascade Locks property is about a 45-minute drive from Portland, about half the time it takes to get to Spirit Mountain.

The Port of Cascade Locks, which owns the site, is willing to fold it into the Warm Springs reservation, hoping to benefit the economically depressed community.

Kulongoski said Tuesday that he didn't recall discussing the alternate site during the 2002 campaign, four years after it emerged in public debate.

At any rate, Kulongoski was obliged by federal law and court decisions to negotiate in good faith when the Warm Springs requested talks about a casino proposal in March 2004, said David Reese, the governor's legal counsel.

Kulongoski signed a legal compact for the Cascade Locks site in April 2005, subject to federal approval. The governor's negotiating team scored many concessions.

The Warm Springs agreed to close its disappointing Kah-Nee-Ta casino in Central Oregon and donate land or easements barring it from building at Hood River. The tribe agreed to construct a "green building" and not stand in the way of unionization of the casino. It agreed to donate 6 percent of gambling profits to community projects, such as trail improvements in the gorge.

And it agreed to put an unprecedented 17 percent of gambling revenues, after prizes are paid, into a new Oregon Benefit Fund. The lion's share would go to Kulongoski's pet cause, state higher education.

The benefit fund would take one-sixth of gaming revenues before wages and other casino expenses. That's an even larger share of the profits, and it would enable the state to extract money from a casino that's exempt from taxation -- as are all American Indian casinos.

Environmentalists were appalled by the prospect of a mammoth casino in the federally protected and fragile gorge. Grand Ronde members were alarmed by the possibility of a casino closer to Portland and leery about Kulongoski finding a way around the ban on taxing tribal casinos.

Studies show that Spirit Mountain could lose 25 percent to 30 percent of its customers if the Warm Springs tribe builds in Cascade Locks, Martin said.

Reese said the argument about off- versus on-reservation casinos is not so simple. Most of the Oregon tribal casinos are not on land originally associated with each tribe's reservation, he said.

Kulongoski said he couldn't stop the Warm Springs from building a casino in the gorge and won numerous public benefits by shifting it from Hood River.

"If you for a moment think that the Warm Springs wouldn't have built a casino on that site, I think you're sadly mistaken," he said.

Kulongoski said he also was concerned that the Warm Springs remain impoverished, because Kah-Nee-Ta is too remote.

"I guess this is an explanation," he said, "if you want to know what moved me to the whole thing."

Both the Grand Ronde tribe and Friends of the Columbia Gorge argue that the Hood River site was unbuildable. Among other reasons, there would be no way to build roads to the reservation parcel because of federal gorge protections, Lang said.

"That's just a false choice," said Martin, the Grand Ronde lobbyist. "The U.S. Forest Service said it couldn't be done."

Lang suspects that Bergstein, a longtime acquaintance of Kulongoski and one of the state's consummate political fixers, used his persuasive skills on the governor.

Bergstein, who consulted for the Grand Ronde tribe until 2002, faults his former client for trying to keep an impoverished tribe from sharing in the casino bounty.

During his days advising the Grand Ronde, Bergstein said, the tribe deliberately played a modest role in politics rather than throwing its weight around. That changed under new tribal leadership, he said.

Kennedy, who became the tribal chairwoman five years ago, dismisses that as sour grapes from someone who lost his contract with her tribe.

One thing not in dispute is the bucketloads of money at stake. Studies show an annual market of $700 million to $1 billion for casinos that can land inside the Portland urban area.

Several players are trying to get a piece of the action besides the Warm Springs tribe.

Oregon State Lottery retailers won Kulongoski's approval last year to add slot-machine-style games to video-poker terminals at bars and restaurants. Those mini-casinos sprinkled throughout the state still earn twice the profits of Oregon's nine tribal casinos.

The Cowlitz tribe is proposing a large casino north of Portland, near La Center, Wash.

A private group is proposing a ballot initiative that would grant it exclusive rights to build a private casino on a former dog-racing track east of Portland.

The Klamath tribe has suggested a casino at the Langdon Farms golf course north of Aurora.

Even the Grand Ronde tribe -- despite running TV ads denouncing the spread of casino gambling -- has discussed four options to build a Portland-area casino. The tribe dangled proposals to build a major-league baseball stadium and a headquarters hotel near the Oregon Convention Center in exchange for permission to build an urban casino.

Despite the new competition, the Grand Ronde tribe is expanding Spirit Mountain gaming facilities by 33 percent after gaining Kulongoski's support for a new compact in March.

Bob Whelan, an Eco Northwest economist with expertise in tribal gaming, said the Grand Ronde expansion makes good business sense. Even though Spirit Mountain will lose customers if the Warm Springs and Cowlitz casinos are approved, gambling revenues are growing a healthy 7 percent per year, he said, with no signs of the market being tapped out.

If the Grand Ronde continues its aggressive ad campaign against the competition, the tribe could alienate voters and become the election issue, said Roger Gray, who is consulting for the private casino initiative.

Kulongoski is skeptical that the Grand Ronde tribe has the ability to determine Oregon's next governor.

"And I'm not sure that's good for the tribe to have the perception that's what they are trying to do," he said.

Kulongoski said it's ironic, given the American history of breaking treaties with Native Americans, that the Grand Ronde tribe is asking him to retract his support for the Warm Springs casino.

Although the compact with the Warm Springs must come back for his consent if it wins approval from the federal government, Kulongoski said he won't change his mind "and tell the Warm Springs a deal's not a deal.