Patrick Marley

Milwaukee Journal Sentinel

Madison — A northern Wisconsin tribe says the expansion of another tribe’s casino will cost it millions of dollars and has assembled a national legal team in a sign that litigation over the expansion could be coming.

A market study funded by the Stockbridge-Munsee concludes the tribe would lose more than $22 million a year if a nearby Ho-Chunk gambling facility is expanded as planned — an expansion the Stockbridge contend is not allowed.

The general counsel for the Stockbridge said he hopes the study gets the attention of state and federal regulators so that they will closely review the expansion of a Ho-Chunk casino in Shawano County northwest of Green Bay.

The Ho-Chunk facility in Wittenberg is about 15 miles nearer to Wausau than the Stockbridge casino in Bowler.

“When you put a duplicate facility on highways 15 miles closer to your main market, that’s going to have devastating effects,” said Dennis Puzz, the Stockbridge general counsel.

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The Ho-Chunk opened the Wittenberg casino in 2008 as an “ancillary facility” that’s allowed under a compact reached with then-Gov. Jim Doyle in 2003. In September, the Ho-Chunk began a $33 million project to add a hotel, hundreds of new slot machines and table games.

The Stockbridge and other tribes contend such an extensive upgrade is not allowed for what is supposed to be a secondary casino.

The Ho-Chunk are one of the richest tribes in the state. The tribe has four major gambling facilities, including ones in Madison and Wisconsin Dells.

Ho-Chunk representatives did not respond to requests for comment, but in the fall said they were confident the expansion can proceed.

The Stockbridge have retained a pair of attorneys — Bryan Newland and Scott Crowell — who specialize in the complex area of Indian casino law.

Newland, of Michigan, served on President Barack Obama’s transition team and was a top aide in the Bureau of Indian Affairs. There, he worked on policies on casinos and Indian lands.

Crowell, of Arizona, won federal court decisions that found California Gov. Arnold Schwarzenegger had negotiated in bad faith with a tribe over a revenue-sharing deal the courts considered an illegal tax.

In the market study commissioned by the Stockbridge, the tribe found the Ho-Chunk casino expansion will cost other tribes $36.8 million a year.

The biggest chunk — $22.1 million — would come from the Stockbridge. Also taking a hit would be casinos run by the Oneida ($5.2 million), Menominee ($4.3 million), Chippewa tribes ($3.4 million) and Forest County Potawatomi ($1.8 million).

The study by Market & Feasibility Advisors of Chicago noted overall casino revenue in Wisconsin has been stable for years. Together, the tribes take in about $1.2 billion after paying out prizes, according to state figures.

The total amount casino-goers spend isn’t expected to change, because Wisconsin is “the very definition of a saturated market,” the study found. The new business the Ho-Chunk will get after the expansion will be accompanied by reduced spending at other casinos, the report concluded.

Casino profits are the primary source of revenue for tribal governments and a big reduction could force service cuts. That makes it essential that state and federal regulators review the issue closely, Puzz said.

“Both have a duty here,” he said. “Both have a responsibility and both have the ability to take enforcement actions.”

The Stockbridge have asked the state Division of Gaming to retain outside lawyers and experts to review the issue, but the state hasn’t yet given an answer on that, he said.

But Steve Michels, a spokesman for the division, said by email that the Ho-Chunk expansion is allowed.

“The Ho-Chunk Nation is adding to their facility in a manner consistent under the terms of the 2003 Doyle compact amendment,” he said in his email. “We will continue to work with and engage in dialogue with all of the tribes.”

A spokesman for the National Indian Gaming Commission did not return a call.