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From The Post FBI Had Overlooked Key Files in Probe of Chinese Influence (Nov. 14) Chung Visits Described as 'Nuisance' (Nov. 14) Reno Extends Investigation of Casino Rejection By George Lardner Jr. and Roberto Suro Washington Post Staff Writers Friday, November 14, 1997; Page A22 Attorney General Janet Reno yesterday stepped up the investigation of Interior Secretary Bruce Babbitt's role in the rejection of an Indian casino opposed by tribes that contributed heavily to the Democratic Party for the 1996 campaign. Reno notified the special federal court panel in charge of appointing independent counsels that she was commencing a preliminary inquiry to determine whether one should be named in Babbitt's case. Under the law, Reno must ask the court to appoint an independent counsel unless she can certify within the next 90 days there are no "reasonable grounds to believe further investigation is warranted." Justice Department sources said the truthfulness of Babbitt's recent testimony to the Senate Governmental Affairs Committee about the casino controversy is a central focus of the inquiry. Babbitt has denied that political pressure was a factor in the 1995 scuttling of the off-reservation casino project that three impoverished Wisconsin Chippewa tribes wanted to build on the site of a failing dog track in Hudson, Wis., 26 miles east of Minneapolis. The decision was "the right decision . . . faithful to our policy not to force off-reservation gaming onto any community that is opposed to it, as was the case here," Interior Department spokesman Michael G. Gauldin said yesterday. "It was reached on the merits, not on the basis of any alleged political influence." Reno's action came amid a flurry of disclosures stemming from the Senate committee's inquiry into the controversy over the past few weeks. The Interior official who rejected the application, Deputy Assistant Secretary Michael Anderson, told Senate investigators he was hurried into making a decision July 14, 1995, on instructions from "upstairs" that it had to be "signed that day." "I assumed there was a reason why the Secretary's office wanted to get it out," Anderson said in a deposition. He said he got the word from Mike Chapman, a special assistant in his office who presented a letter of denial to Anderson for his immediate signature. Regional officials of the Bureau of Indian Affairs had recommended approval of the off-reservation casino on behalf of the three Chippewa bands. Higher-ups at Interior rejected it after lobbyists for casino-rich tribes opposed to fresh competition contacted President Clinton, presidential counselor Bruce Lindsey, White House deputy chief of staff Harold Ickes and Democratic National Committee Chairman Donald L. Fowler. White House documents show that Clinton expressed a continuing interest in the "Hudson casino matter" during the final days of the 1996 campaign after litigation had been filed by the losing tribes. Mark Goff, spokesman for the rejected Chippewa, pointed out that the Mdewakanton Dakota Sioux — the wealthiest of the opposing tribes thanks to its Mystic Lake casino in southeastern Minnesota — contributed $50,000 to the DNC the month before the election. One of the tribe's lawyers at the time was Tom Collier, who was until June 1995 Babbitt's chief of staff. He told Senate investigators this fall that he talked to the Shakopees about contributions to the DNC and that he and the tribe's chairman personally delivered a $50,000 check to DNC headquarters. "We ended up giving it to Mr. Fowler," Collier told investigators. He also said he undoubtedly talked to Babbitt about the Hudson casino project in the spring of 1995 when the decision was pending, probably several times, but had no "specific recollection of a specific discussion." The opposing tribes contributed more than $300,000 to the DNC and other Democratic causes for the 1996 campaign, most of it after the Chippewa application was turned down. Attention on Babbitt sharpened last month when an old friend and law school classmate who had been hired by the Chippewa, Paul Eckstein, told of meeting Babbitt on July 14, 1995, just after learning from Interior Department counselor John Duffy that the application had been rejected. Seeking an explanation, Eckstein said Babbitt told him that Ickes had "directed him to issue the decision that day." Babbitt, Eckstein testified, also asked him a "rhetorical question" about how much "these tribes," apparently referring those opposed to the casino, had contributed to the Democrats, and gave him the answer: "half a million dollars." Contrary to his denials of a year earlier, Babbitt testified that he probably had said Ickes wanted a prompt decision, but said he made up the story to get a persistent Eckstein out of his office. He said he had "no recollection" of mentioning campaign contributions to Eckstein. Interior officials yesterday described the need for a decision on July 14, 1995, as a comedy of errors triggered by an aide to Duffy, Heather Sibbison, who recalled Anderson first signing the rejection letter on July 13. Sibbison, a Senate source recounted, said she faxed the letter to one of the losing tribes, but then rescinded it on learning that Eckstein was scheduled to meet with Duffy the next day to make a final entreaty. Duffy, the source added, told Senate investigators that Eckstein provided "no additional information" and thus no reason to change the decision. Chippewa spokesman Goff protested that "we weren't even advised there was a need for additional information." © Copyright 1997 The Washington Post Company Back to the top Go to Campaign Finance Report | Go to National Section