Big growth in tribal gambling in the works

In the biggest potential expansion of gambling in a decade, a proposed agreement could increase the number of electronic slot machines in tribal casinos around the state by up to 48 percent.

The proposal would also allow tribes to quadruple the betting limit from $5 to $20 on 15 percent of the machines on the casino floor, and allow unlimited hours of operation. The agreement would also allow tribes to offer machines activated with cash, rather than a ticket, and with faster, one-button play.

The changes, which require approval from Gov. Christine Gregoire and the federal government, would be part of proposed gambling compacts between 27 tribes and the Washington State Gambling Commission.

Depending on market demand, tribes could eventually add as many as 8,100 new slot machines at their casinos, pumping up the total number of machines to more than 25,000.

W. Ron Allen, president of the Washington Indian Gaming Association, and chairman of the Jamestown S'Klallam Tribe, said tribes initially asked for a much larger number of slot machines. He said the proposed deal is a good compromise — and tribes may not use the entire allocation.

The agreement does not change the number of casinos in operation, just the number of machines allowed in them.

"You are not going to see that big of a change in atmosphere; you are not going to see casinos on every corner," he said.

The agreement, expected to be completed over the next several weeks, comes on the heels of a compact Gregoire signed Friday approving the first-ever agreement with the Spokane Tribe. That agreement ended years of state litigation with the tribe, the last to operate one-armed bandit slot machines the state contended were illegal. The agreement also set the stage for the expansion envisioned in the coming compacts with other tribes.

Those who own nontribal gambling businesses say the expansion proposed for tribal casinos will be just another nail in their coffin. They have tried unsuccessfully for years to crack the tribes' monopoly on operating lucrative electronic slots.

"I am a very, very bitter person over this whole thing," said Dave Storkson, owner of San Juan Lanes in Anacortes.

He said his bowling ally, which offers pull tabs, can't begin to compete with the Swinomish and Upper Skagit casinos just minutes away.

"I have nothing against the tribes. They have been given the golden goose and they are making the most of it, and I would do the same thing," he said. "They furnish a lot of good jobs. I would like to furnish a lot of good jobs. I had a cardroom and I had to close it, I couldn't compete."

The proposed agreement marks the first across-the-board increase in the allocation of machines since 1999.

Each tribe would be allocated 975 machines, up from 675 currently. The tribes can operate more slots than their allocation by leasing machines from smaller, rural tribes that don't have casinos — a system that has helped more isolated tribes get a piece of the gambling pie.

In total, most tribes in the state are currently allowed to operate 3,000 machines in two casinos.

Only the biggest urban casinos, such as those operated by Muckleshoots in South King County, the Tulalip tribes in Snohomish County and the Puyallups in Pierce County, come close to operating that many machines.

Under the new deal, each of those three tribes could eventually operate as many as 4,000 machines.

Rick Day, director of the Washington State Gambling Commission, said the proposed agreement strike a balance between the tribes' wish to expand their operations and the state's desire to keep the expansion of gambling in check.

"This was a burning issue," Day said of the tribes' push for more machines.

Electronic slots were first installed at tribal casinos in Washington in 1999.

The machines have proved wildly popular cash cows, generating at least 70 percent of the revenues in any casino. They come with no labor costs. And there is no risk a high roller will swagger off with a big win: The house sets the payout rate.

Because of the slots, tribal gambling revenue in 2006 was nearly $1.2 billion, dwarfing all other forms of legal gambling in Washington.

The proposed agreement breaks new ground with requirements for tribes to use a percentage of their profits to pay for smoking-cessation and problem-gambling programs.

The gambling commission is expected to announce the proposed agreement in early March, if it is approved by individual tribes.

That will kick off a lengthy process that includes a legislative hearing and review by the gambling commission. The deal must then go to the governor and U.S. Department of Interior for approval.

The new compacts could go in effect this fall.

For tribes, the compacts mean an opportunity to continue expanding programs and services that never would have been possible without lucrative slot machines, said Brian Cladoosby, president of the Association of Washington Tribes and chairman for the Swinomish Tribe in La Conner, Skagit County.

While not in love with gambling, Cladoosby is a solid believer in the ability of casinos to improve the lives of tribal members.

"I wish it was something else," Cladoosby said. "Gaming has been the only positive economic-development tool that has worked for Swinomish and the other tribes in the state."

The Swinomish casino employs about 500 people, 80 percent of them non-Indian. Profits pay for a range of investments by the tribe that include a $7.5 million housing development for tribal members, a $2.5 million sewage-treatment plant, and $24,000 college scholarships for every high-school graduate.

The tribe also hired six instructors to work in public-school classrooms to help with English, math, history and science instruction. After school, the instructors follow the kids — tribal and nontribal — back to the reservation to help with their schoolwork at a new $3.7 million youth center, all paid for with casino profits.

Along the way the tribe has invested in beach condos and bought an apartment building for tribal members to ease the tribe's housing crunch.

"We wouldn't have even thought about doing anything like this seven, 10 years ago," Cladoosby said.

Lynda V. Mapes: 206-464-2736 or lmapes@seattletimes.com