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American Indians plan slot-like bingo machines for Brownsville

By Daniel Michaels, May 20th 2005
In the long term, the American Indians could replace those machines with conventional slot machines if Pennsylvania legalizes the latter's use at existing racetracks and/or other locations, according to a press release from Ernest E. Liggett.

While the machines initially slated for use in Brownsville look, sound and operate like conventional slot machines, in reality they play an electronic version of bingo, which is already a legal game in Pennsylvania. A small bingo card is displayed in one corner of their screens, and groups of players compete against each other.

Ohwista Ko:Wah Holdings Ltd. is working to purchase two Liggett companies - Brownsville Group Ltd. and Manor Investments Ltd. - that in combination own practically all of downtown Brownsville.

"They're in the process of acquiring the corporations that own those properties. It's a more expeditious way of accomplishing the transfer of ownership," Liggett said Friday.

Liggett's press release notes that using the properties as collateral, the Ohwista Ko:Wah on July 9 entered into a financing agreement with a group "that specializes in unconventional real estate transactions" to secure and provide $100 million to purchase the properties and create usable space in existing or newly constructed buildings.

"This is the uniqueness of the transaction. Ohwista Ko:Wah as a corporation would not have the collateral to do the deal, not until they start assuming the ownership of the corporations that own the property. That's in the works," said Liggett, who clarified, "I'm not being paid $100 million for the property."

Phase 1 of the plan as outlined in the press release calls for 80,000 square feet for tribal gaming space, regulated by the tribe and not the state, in conjunction with the National Indian Gaming Commission.

It also calls for 320,000 square feet devoted to "non-gaming, mixed-use activities," including 10,000 parking spaces, hotels, a renovation of the Plaza Theatre and a marina at the site of the Authenreith Building.

Improvements for local education, emergency, fire, hospital, police, and borough services and infrastructure also are part of the $100 million Phase 1.

Phases II and III call for additional development worth $80 million and $70 million, respectively, when demand requires expansion of "non-gaming, mixed-use components." Such growth will be "dictated by demand for additional space, for whatever type use," said Liggett.

The Indian group, after forming a Pennsylvania corporation, entered into an agreement to purchase the 114 Liggett properties "as is, pending Native (American) redevelopment," notes the press release.

A National Indian Gaming Commission report issued Sept. 22 paved the way for the American Indian corporation to use the slot-like bingo machines, according to the press release. It notes that the 19-page NIGC report indicated that Class II gaming devices that "look like, sound like, and play like slot machines are not slot machines but a version of bingo; and, with this distinction could be operated in venues like Brownsville without state consent, oversight or revenue sharing since bingo is legal in Pennsylvania."

In the long term, the Indians could replace those Class II machines with Class III slots that are essentially the same as those that would be sanctioned at racetracks, according to the press release.

Liggett said that under federal law the NIGC writes the rules for Indian gaming and that those rules are applicable nationwide.

"That's a universal opinion (permitting use of the bingo machines). It applies to all jurisdictions. Their determination is basically the determining authority over Indian gaming," said Liggett. "It's like any regulatory agency. This is within the confines of the parameters of the statute that they were given to regulate Indian gaming."

Liggett said that once the Ohwista Ko:Wah corporation acquires the Brownsville properties, it will become an "implementation vehicle" that will steer its own future regarding gambling. He said that an out-of-state tribe is pursuing the same course in Ohio, but he noted that the Brownsville project has no strict implementation timetable.

"This is called 'In Indian time,' and that means when all the elements line up," Liggett said of the development pace. He added that the casino would be located in downtown Brownsville, and the plan calls for restoring the borough streetscape to the 1920s era.

At the end of his press release, Liggett listed three contacts for "local support" in regard to the plan: Stella Broadwater of the Brownsville Area School Board, Fayette County Commissioner Ronald M. Nehls and state Sen. Richard A. Kasunic (D-Dunbar).

Nehls said that while he personally doesn't support gambling, if its arrival is inevitable he thinks community leaders at all levels should "get together and open lines of communication to make the best of it.

"I wouldn't call me a supporter. I'm a realist in the sense that it appears that there has been a lot of thought and planning that has gone into the process. It appears to have been (an) upstanding and creditable ... process, some of which may not have been able to have been revealed (until now). But if there are some positives, then let's take advantage of them, in a cooperative effort," Nehls said.

Broadwater said she wholeheartedly supports the Indian plan, mostly because it brings the promise of hope and employment to the borough. With bingo and strip tickets "really big" and eight state lottery machines operating in or near the borough, Broadwater said, gambling is already a popular enterprise.

"The bingo halls are packed full, the lottery machines are running full (tilt). If people want to gamble, that is their prerogative; that is their choice," said Broadwater. "There are many people that I know in Brownsville personally who go to Wheeling Downs several times a week, or go to Atlantic City, to gamble."

Broadwater said she circulated petitions in favor of Indian gaming and sent 1,500 signatures to Gov. Ed Rendell, state Sens. Kasunic and Barry Stout (D-Bentleyville) and state Reps. Peter J. Daley (D-California) and H. William DeWeese (D-Waynesburg).

"You know that the school district needs money. I feel that it would be an asset," said Broadwater. "I don't know what could hurt Brownsville at this point. (People) want hope. What could it hurt, having stores and bringing in employment? Maybe these people wouldn't be active in drugs if they could get jobs.

"I feel it's really good for Brownsville. I feel that it really is the hope."

Kasunic, who in April 2002 hosted a meeting between the American Indians, Liggett and his wife, Marilyn, and a delegation representing Fayette County, said the Indians are "for real" in terms of their interest in the project.

"They have a plan. (And) there's nothing that allows the state Legislature to fight or oppose this," Kasunic said.

He said that his subsequent research supported the position, as laid out by the American Indians, that their plan does not require local, county or state approval. He said that federal approval and recognition, through the Department of Interior, is basically all that's required.

"Once all this takes place, they can come into Brownsville and establish gaming," said Kasunic. "What they sat there and told us (18 months ago) was exactly the truth. It may be fortunate or unfortunate, when you find out that the borough, the county and the state have no say."

Once gaming is established, Kasunic said, Gov. Ed Rendell has a limited "window of opportunity" to negotiate a compact with the

American Indians, one that would spell out how any gambling revenue would be shared with the state, county, borough and school district. If an agreement is not reached by that deadline, said Kasunic, the American Indians are under no obligation to share any of the proceeds.

If the arrival of slot machine-style gambling is a given, Kasunic said it's in the best interest of everyone to support those negotiations, which would provide money for services such as police and fire protection and for education.

"It can't be ignored. It's not going to go away," said Kasunic. "If they're given the opportunity to do this, my attitude would be, 'We have to take the high road here.' If it's going to exist, we should be sure that the community benefits by it, rather than putting our heads in the sand and ignoring it and ending up with nothing to support the public services that would be required to support this (enterprise)."

Kasunic said the American Indians have pledged to hire and train local workers, to hire local firms and tradesmen for construction and to create jobs that pay a living wage.

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