Aug. 10, 2003 - TACOMA, Wash. -- The 28-acre swatch of land in East Tacoma hard by Interstate 5 doesn't look like much right now -- some vacant lots, a tiny Indian casino and a parking lot surrounded by a rundown, working class neighborhood.

But in the next few weeks, the Puyallup Tribe of Indians will break ground on a $200 million gambling mecca that promises to change the face of Indian gaming in the Pacific Northwest. The Puyallups will be the first tribe in the nation to place a destination gambling resort in the heart of a major metropolitan area.

The gaming floor alone will offer 2 1/2 acres of slot machines, blackjack tables and roulette wheels. A six-story luxury hotel with 79 rooms will feature a one-acre man-made lake in front all next to Interstate 5, convenient access for the 177,000 vehicles that travel the freeway daily.

Tribal officials are studying the possibility of a dedicated freeway off-ramp that would pour traffic into a 3,000-car parking complex. They are also looking into whether it would be feasible to link the casino to Tacoma's new light-rail line, which already runs past the city's new convention center.

No tribe has yet built a Las Vegas-style destination resort in a city.

"The only difference between this and anything on the (Las Vegas) strip is we don't have 5,000 rooms," said architect Bill Morris, who is designing the complex. "This is the same as The Mirage for gaming space."

Oregon tribes are watching the development with interest. Although Gov. Ted Kulongoski refused to allow an Indian casino in Portland earlier this year, he has not ruled out the possibility in the future.

"This could definitely change the landscape in gaming as we know it," said Brent Merrill, spokesman for Oregon's Confederated Tribes of Grande Ronde.

Merrill said the Tacoma development builds the case for similar ventures elsewhere. Grande Ronde, he said, remain optimistic that they too will get an urban casino. In recent years, the Confederated Tribes of Warm Springs have asked for permission to build an off-reservation casino in the Columbia Gorge.

In the past, relatively small tribal casinos have been situated in rural areas on reservation land. Located far from major cities, they have earned tidy profits for the tribes. The Grande Ronde's Spirit Mountain Casino, west of McMinnville, is believed to be the most successful in Oregon, with net income of approximately $75 million annually.

The new casino, which has not officially been named, is expected to do much better. With the Puget Sound area home to more than 3 million people, the Puyallups project profits of between $200 million and $300 million annually, tribal officials said.

"There is nothing like this in the whole Northwest," said Frank Wright, who manages the tribe's two casinos.

The Puyallups are no stranger to gambling. The tribe has been running two smaller casinos in Tacoma since 1996. Located on a riverboat along an industrial wharf and on the working class east side of town, they have helped lift the tribe out of poverty.

The casinos currently are earning the tribe about $100 million in net income each year. Every month, each of the approximately 3,000 tribal members gets a $2,000 gift from the tribe, as well as access to a free medical clinic, a K-12 school and a new college for tribal members.

"It helps out tremendously," said Herman Dillon Sr., a tribal council member. "Where we used to get a lot of assistance requests, that's almost nil now."

It had been a giant leap forward for what was once an impoverished tribe with only a few hundred acres of land. Largely unknown compared to larger Northwest tribes like the Nez Perce or the Warm Springs tribes, the Puyallups leaped to the front pages in the 1960s when their fight for fishing rights drew Hollywood stars such as Marlon Brando and comedian Dick Gregory to their cause.

Even after winning a major court victory giving them access to the salmon harvest in 1974, many of the tribe's members lived on public assistance and subsistence fishing until gambling started. Now they are poised for a new era.

When European explorers first visited Puget Sound, the Puyallups lived in winter encampments along the Puyallup River in what is now Tacoma and surrounding cities. The tribe was then estimated to be about 300 to 400 people, who moved around the sound in the seasonal hunt for food, primarily salmon.

When the tribe signed a treaty with the U.S. government in 1854, their reservation encompassed much of what is now Tacoma.

What remains today is slightly more than 800 acres scattered throughout the Tacoma metro area. Although a small remnant of the original reservation lands, those holdings are the key to the tribe's growing wealth: Because the tribe has its own land in the city, it can build a casino. It has virtually no requirement to negotiate with surrounding governments on details ranging from building permits to traffic, although the tribe is working with the City of Tacoma and other local governments.

Federally recognized tribes are sovereign nations under federal law. The land they own is held in trust by the federal government and is exempt from everything from property taxes to rules on local building permits.

In the case of Washington tribes, it also means they are exempt from the state sales tax -- a major selling point for any retail development. The Puyallups do share their wealth through a fund composed of 2 percent of gaming income. Local governments can apply for grants. Oregon's nine federally recognized tribes are concentrated in rural areas of the state, and none owns urban land that could be turned into a casino.

Location is critical because the success of a casino is tied directly to how close it is to customers. Thus, the Confederated Tribes of Warm Springs have pushed for permission to build an off-reservation casino in the Columbia Gorge at Cascade Locks, close to Portland, while the Grande Ronde offered earlier this year to help fund a major league baseball stadium in Portland in exchange for the right to build a casino in the city.

Oregon policy toward tribes currently confines them to one casino each on reservation land. In order to build a casino off a reservation, a tribe would need to buy land and then have it taken into trust by the federal government. Gov. Kulongoski would have to approve a change in policy, something spokeswoman Mary Ellen Glynn said is still being considered.

Meanwhile, the Puyallups face no such constraints.

The Puyallups' new casino is to the tribe what a royal flush is to a poker hand. Plans for the casino remain fluid, but as of Friday the tribe was considering putting in a movie theater and grocery store on the property, along with the resort hotel and casino. As many as seven restaurants and an entertainment hall with seating for 3,000 is planned to be mixed in under one roof with the casino itself.

The tribe already employs 2,200 people, Indian and non-Indian alike. That number is likely to increase by as much as 3,500 when the casino is finally completed.

"It's a new world for them, no question about it," said Randy Lewis, government relations director for the City of Tacoma.

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(c) 2003, The Oregonian, Portland, Ore. Distributed by Knight Ridder/Tribune Business News.