KENOSHA (WITI) -- A tribal compact between the Potawatomi Tribe and the state of Wisconsin could hold taxpayers responsible if the Potawatomi casino in Milwaukee were to lose business because of a new casino in Kenosha. A newly-released letter from Governor Scott Walker's attorney says that compact likely violates the state constitution.
That letter says creating a financial obligation for the state to pay out losses is "beyond the power of the Governor."
The tribal compact was signed by former Governor Jim Doyle.
Governor Walker says he's trying to figure out a way to approve the Kenosha casino project without hurting the state's budget.
A little over two months ahead of a deadline for a decision on the proposed Kenosha casino, Governor Walker on Tuesday, December 2nd issued his own letter in which he discusses the decision-making process.
The letter reads as follows:
"In August 2013, the Bureau of Indian Affairs in the U.S. Department of Interior approved an application to allow the Menominee Indian Tribe of Wisconsin to construct and operate a casino in Kenosha—pending the approval of the Governor of Wisconsin. Given the level of interest in this project, I wanted to provide an update on the process, since a decision will need to be made by February 19th, 2015.
A lot of information has been presented in support of and in opposition to the proposed casino. We want to ensure that any job creation or positive economic impact in one area does not come at the expense of significant losses in other parts of the state.
For more than a year, at my direction, Department of Administration (DOA) Secretary Mike Huebsch has worked with experts to conduct an independent, unbiased financial and economic analysis of the proposed Kenosha casino. Secretary Huebsch has also conducted extensive discussions and negotiations with the impacted tribal governments to work toward a win-win-win scenario.
The process is still ongoing and is very complicated. Governor Jim Doyle negotiated updated compact amendments with several tribes to indemnify, or protect, them from losses as a result of a new competing casino.
Due to the compact amendments negotiated by Governor Doyle, the proposed casino could cost the State hundreds of millions of dollars over multiple years, so we want to make sure the project does not have an adverse impact on our state’s taxpayers and the budget. Tribes with casinos make yearly revenue sharing payments to the State, and we have already seen an impact on the state budget because of the Potawatomi’s decision in June to withhold their required payment.
In addition, the compact that Governor Doyle negotiated with the Potawatomi requires the State to follow a specific, pre-determined process that works to offset the financial impact of the proposed casino on the Potawatomi's current casino operations. The State must submit changes to the compact with the Potawatomi to the federal government for approval.
Following the process negotiated by Governor Doyle, we submitted a Potawatomi compact amendment that was chosen by an arbitrator to the federal government. The Potawatomi compact amendment submitted to the federal government, if approved, would require the State to make an annual payment to the Potawatomi to compensate the Potawatomi for losses that are not covered by the Menominee.
Following the Doyle compacts is not an indication of supporting or opposing the casino, but is another step in the process of gathering information. Ultimately, the action taken by the federal government will help us gain a better understanding of the true economic and fiscal impact of the proposed Kenosha casino on our state’s taxpayers.
We continue to work toward a win on all fronts. As the process moves forward, I will continue to provide periodic updates. Thank you for taking the time to read this letter."
Again, Governor Walker is expected to make a decision on the proposed Kenosha casino by February 19th.
READ IT: Transmittal letter from Governor Walker's attorney to federal Bureau of Indian Affairs on compact agreement with Potawatomi Tribe