City officials have talked to casino developer Steve Wynn (search) about building an Indian casino and resort just blocks from Disneyland.

The city, located in Orange County, is considering selling as much as 45 acres to the Mesa Grande Band of Mission Indians (search), a San Diego County tribe that wants to build a resort with shopping, restaurants and live entertainment comparable to Las Vegas.

Another possible casino deal also was reported this week in Northern California. Two newspaper reported that Gov. Arnold Schwarzenegger (search) was prepared to sign a pact that would allow an Indian casino in the Bay Area — the first slated to be in an urban area.

"We have the opportunity to bring in the most premier resort developer to Orange County and create an attraction unlike anything else in California," City Manager Matt Fertal said. "If people want to focus on just the gaming, then they're being very shortsighted."

City officials said they met with Wynn earlier this year to discuss the idea and had also pitched it to representatives of the governor. Wynn, who built the Bellagio, Mirage and Treasure Island casinos in Las Vegas, confirmed the meeting but told the Los Angeles Times the talks were "based on hypothesis on top of hypothesis."

"There are no negotiations," Wynn said in a statement.

Casino industry analysts and local officials said they don't believe the deal would be approved. Already, there is significant opposition, including from the city's mayor, Bruce Broadwater.

Orange County Supervisor Chuck Smith, whose district includes Garden Grove, said he was also opposed to the idea.

"It's too close to Disneyland, which is a family resort," Smith said. "I don't care what they say about these casinos being family-oriented, they really aren't. ... It's not a good fit."

The Los Angeles Times and the Sacramento Bee reported Tuesday that a compact was expected to be signed this week between the Lytton Band of Pomo Indians and the state allowing the tribe to build what could be one of the world's largest casinos on a site in San Pablo, across the Bay from San Francisco.

They quoted sources as saying that in exchange for state permission, the tribe would pay up to 25 percent of its gambling profits to the state — a far larger share than what five other tribes agreed to give up in agreements Schwarzenegger negotiated in June.