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Texas' Only Legal Casino, The Kickapoo Lucky Eagle Casino,
Contemplating a 400-room Hotel
By John W. Gonzalez, Houston Chronicle
Knight Ridder/Tribune Business News

Sep. 26, 2004 - EAGLE PASS, Texas -- Hundreds of new slot machines sat unplugged and out of harm's way last week as construction workers scurried to put finishing touches on the cavernous new Kickapoo Lucky Eagle Casino, the state's only legal gambling house.

The glitzy machines soon will be flashing and jingling as the 100,000-square-foot facility, with high-stakes poker parlors and a boxing arena under the same roof, debuts to the public Oct. 7.

That "soft" opening will be followed by a grand opening Oct. 28 -- the second anniversary of the Kickapoo Traditional Tribe of Texas' revolt against leaders who were accused of mismanaging the casino after its opening in 1996.

"Oct. 28 is a very interesting date. That's when the tribe took over in 2002," said Kendall Scott, a Kickapoo who serves as casino marketing director.

After a bitter power struggle culminated a year ago with court-ordered tribal elections, the prevailing faction pushed for completion of the long-planned casino expansion. With the project nearly complete, leaders are contemplating a 400-room hotel on the reservation, about 10 miles southeast of Eagle Pass.

They're also hoping Texas lawmakers, who might mull over new gambling options to increase state revenues for public schools next year, will authorize the tribe to conduct Class 3 games including roulette and dice -- if Texas racetracks are allowed to have video lottery terminals.

"That's a big if," conceded Ida Gutierrez, another casino administrator. Even with a pressing need for state revenues, opposition to new forms of gambling is strong within the state's GOP majority, she said.

So, the Kickapoos are concentrating on the task at hand -- opening the new casino to replace the squat, drab facility that has been the Lucky Eagle's cramped quarters since 1996. That's when it won permission to offer Class 2 games including slots, poker, blackjack and bingo.

Since then, the casino has remained in the good graces of regulators at the National Indian Gaming Commission, which conducts regular inspections and reviews required outside audits, officials said.

"The folks in the field told me they are operating according to regulations," said NIGC spokesman Shawn Pensoneau in Washington, D.C.

The state's two other federally recognized tribes, the Tiguas of El Paso and Alabama-Coushattas of Livingston, had Class 2 games until 2002, when federal courts ruled the casinos were illegal under state law.

Unlike the Kickapoos, who have sovereign-nation status, the Tiguas and Alabama-Coushattas are governed by the federal 1987 Restoration Act, which includes a prohibition against gambling not authorized by the state.

The legal battles left the Lucky Eagle as the sole survivor -- a status the Kickapoos relish and exploit.

"We can compete against Las Vegas. We can," Gutierrez insisted. "Our arena is state of the art. These guys went all out."

1,000 slot machinesIn the casino's main room are about 1,000 slot machines and 20 blackjack tables, and two rooms are set aside for poker. Bars, restaurants and a gift shop round out the facility, which from the outside looks like a giant painted drum.

The arena, which seats 4,000 for boxing and 5,000 for concerts, already has been used for fights, but a big card is set for Oct. 15, when fights put together by DeBella Entertainment and Oscar de la Hoya's Golden Boy Productions are scheduled.

To add a touch of Las Vegas, entertainers such as Groove Kitty from the MGM Grand Hotel are set to perform for three months after the grand opening, and officials say negotiations are under way with several big-name international performers. And in a bit of a coup, the Tejano Music Awards, long based in San Antonio, move here in March 2005 for the 25th anniversary show.

The tribe isn't required to disclose casino revenues, and officials declined to do so last week, but it's obviously a lucrative business.

The remote facility attracts gamblers at all hours of the day, mainly from the immediate area but also from San Antonio and nearby Piedras Negras, Mexico.

"Now that we're opening the new casino, we're going to do a bigger marketing plan," Scott said. "We're considering (advertising) from Austin to the Valley and Monterrey," he said. Advertising wasn't pushed previously because visitors usually jammed the facility anyway, officials said.

Gutierrez said most casino revenue goes toward the tribe's lingering debts while an undisclosed portion is raising the standard of living for the tribe, which has about 500 adult members.

"You have to understand that most of the money that is coming in right now has been going to paying off a lot of the debt that was left. Whatever (other) money is made goes to the reservation" to provide health care, housing and other forms of support for tribe members, she said.

There would have been a lot more money for community projects if the tribe's resources hadn't been squandered, she said.

Reversal of fortune"It was a mess," Gutierrez said, "but it's working out."

She said the launch of the new casino was stymied by issues with vendors and contractors who were owed money. When the power shift occurred, the new leaders found evidence of unpaid bills, questionable expenditures and little cash. Acting on complaints from the new leaders, five federal agencies continue to investigate the allegations of impropriety.

A mere $60,000 was left in the till, Gutierrez said.

"There was not a bank anywhere that would even touch us," she said.

Though the tribe's fortunes have changed dramatically in the past two years, officials already are talking about the next money-making idea -- a tribal smoke shop.

"We're going to start selling cigarettes, too," Gutierrez said. "It's tax-free for Native Americans."

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