State warns Potawatomi it could lose gamesTODD RICHMOND, Associated Press

MADISON, Wis. (AP) – The Forest County Potawatomi could lose about 2,000 electronic slot machines at its Milwaukee casino if it continues withholding its $25 million annual payment to the state, an attorney for Gov. Scott Walker’s administration said.

The tribe is trying to convince Walker to nix the Menominee Nation’s plans for an off-reservation casino in Kenosha. The Potawatomi fear the new facility would cut into their Milwaukee profits.

The Potawatomi’s current compact with the state requires the state to reimburse the tribe for any losses suffered due to a Kenosha casino. The tribe also maintains that the compact requires the state to refund previous annual payments if the governor approves the new facility. Walker’s administration maintains that the state could end up owing the Potawatomi as much as $100 million.

Fearful that the state won’t follow through on the refund, the tribe has placed its payment, which was due June 30, in a reserve account.

Walker has until Feb. 19 to make a decision on the Kenosha casino. His administration argues that nothing has changed so far and that the Potawatomi has no right to withhold the payment. The administration contends that the compact doesn’t require a refund. It spells out only that the two sides must enter arbitration over how to compensate the tribe.

The compact states that the two sides shall enter arbitration to determine both the state’s and tribe’s rights and obligations if the governor approves a casino within 50 miles of the Potawatomi’s Milwaukee facility. It states that the tribe’s last best offer “may provide for a reduction in, or refund of, the payments to the State.”

R. Lance Boldrey, an attorney that Walker’s administration hired to handle the dispute, sent a letter to the Potawatomi in late July reiterating the state’s stance that circumstances hadn’t changed. If the tribe wants to argue that the current compact has been invalidated, Boldrey warned, a 1998 deal that the tribe signed with the state would go back into effect. That agreement limits the Potawatomi to 1,000 electronic games in Milwaukee until 2019, when the deal is set to expire.

A 2012 state report found that the tribe offered 3,104 electronic games at the casino.

A Potawatomi spokesman said Thursday that Boldrey’s letter may make a good headline, but that his legal theory has no merit.

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