Decade of Indian Gambling Brings Uneven Dividends

RED CLIFF, Wis. – On the 15,000-acre Indian reservation here, piles of garbage line vacant lots, and burned-out cars sit near homes.

The 4,000-member tribe, the Red Cliff Band (search) of Lake Superior Chippewa, is one of the state's poorest, with about a quarter of all families on the reservation living in poverty.

Gambling -- at the tribe's tiny casino in a former bowling alley -- has done little to improve their lives.

An Associated Press review of census figures found that a decade of tribal gambling in Wisconsin has spread the wealth unevenly among 11 Indian reservations here, bringing phenomenal increases in living standards to two but leaving nine struggling with poverty.

"Gaming hasn't been the economic stimulus for some tribes that congressional members thought it would be," Red Cliff chairman Ray DePerry said.

The AP review showed that the Potawatomi (search) and Oneida (search) reservations saw their incomes skyrocket and their poverty rates plummet between 1990 and 2000.

But despite sometimes significant improvements in living standards, eight of the state's 11 tribal reservations still had higher poverty rates in 2000 than the state average. Nine remained below the state's median household income level in the 2000 census.

The tribes and gambling experts attribute the mixed results to location: The successful Potawatomi have off-reservation tribal land in Milwaukee, and the Oneida are right next to Green Bay, home to the NFL's Green Bay Packers (search). The Red Cliff reservation, in contrast, is at the far northern tip of Wisconsin, 400 miles north of Milwaukee.

Alan Meister, an economist with the Los Angeles-based Analysis Group who studies the economic impact of gambling, said such disparities among Indian casinos are typical around the country. How much money they make depends on what sorts of amenities they offer, how much competition they face, and how convenient their locations are to gamblers, he said.

"Location is a major, major factor, but the quality of the facilities really makes a difference," he said.

All together, the 11 Wisconsin tribes made more than $400 million in profits in 2002 at their 23 casinos, up nearly 60 percent in five years, according to a legislative report.

The run-down Red Cliff casino has just two blackjack tables. A check-cashing service offers instant cash for paychecks, and a restaurant serves up diner fare.

State numbers show the tribe collects less than $3 million a year in net revenue from the casino, less than any other tribe in Wisconsin. The tribe does not report its profits, but the chairman said they are negligible.

DePerry hopes that will change because the tribe signed an agreement with the state to expand casino operations, and financiers are backing DePerry's big dream -- a $22 million luxury hotel with a casino, restaurant, pool and marina to capitalize on the Apostle Islands across the water. It is expected to add 250 to 300 jobs.

"This is a gold mine here on this point," DePerry said.

Before Wisconsin signed its first Indian gambling compact in 1991, the tribes argued that gambling would enable them to improve life on the reservation with better housing, schools and infrastructure.

There have been big changes on the 20,000-acre Oneida reservation near Green Bay. A gleaming new $16 million wood-and-stone health center has doctors, dentists, an optometrist and a pharmacy. Nearby are a day-care center and a modern elementary school that teaches children their Oneida history.

The family poverty rate on the reservation dropped to 4 percent in 2000 from nearly 23 percent in 1990, while the median household income, adjusted for inflation, rose nearly 145 percent to $60,404 during the decade.

After years of working off-reservation in dangerous, depressing jobs such as in a steel mill, Oneida member Dennison Danforth, 59, now works the land in the fresh air at an organic garden on an Oneida farm.

"There's more opportunity for the tribal members than when I was growing up," Danforth said. "It's changed."

Seven round-the-clock casinos with more than 3,200 slot and video poker machines, a huge bingo hall and investments in banks and hotels pay for it all.

The Potawatomi have a flashy off-reservation casino in Milwaukee's Menomonee Valley (search), packed with restaurants and other attractions, and another casino about 200 miles north. Census figures show that while the Potawatomi had the lowest median income of all Wisconsin reservations in 1990, they now have the highest at $62,250 in 2000.

For the Ho-Chunk Nation (search), another tribe, progress has been slower. But the facilities are improving on the reservation, and adult tribal members receive a monthly payout of $1,000 from gambling.

"It's a godsend," tribal spokesman Ed Littlejohn said. "We've ended up getting our people out of the tar-paper shacks in the backwoods and getting them into decent housing."