Two letters demanding $10 million and warning that the Caesars Tahoe casino water supply would be poisoned were found yesterday, along with a sample of poison, police said.

The identical notes were found late Sunday at Caesars and at the Sahara Tahoe across the street.

Caesars Tahoe is across the street and north of Harvey's Resort Hotel, where an extortion plot ended Aug. 27 with the explosion of a bomb that caused $3 million in damage.

Most major casinos at Lake Tahoe and Reno and many in Las Vegas have been plagued with extortion threats since the Harvey's bombing. All have proved false.

The extortion note said the money "is nothing against a billion lost to damaged and decreased property values when the water supply is poisoned."

"Caesars profits go to skimming and lining underworld pockets," the letter added. "My pockets are next."

An oily substances sprayed on a Caesars bathroom ceiling appeared to be a herbicide, possibly 2-4-D with Silvex, and barium cyanide, Nevada Health Officer John Carr said.

Tests of Caesars Tahoe and other drinking water for cyanide were negative, officials said.

Authorities were looking for a Vietnam veteran from San Jose, Calif., for questioning.