Federal regulators deny management contract for Minnesota company 5-18-07

CONCHO, Okla. (AP) - A 13-year relationship between the Cheyenne and Arapaho Tribes and the Minnesota company that managed its Lucky Star Casinos may end after a ruling by federal regulators.

The National Indian Gaming Commission rejected a five-year contract to manage the casinos by Southwest Casino and Hotel Corp. The company's present contract expires on Saturday.

Gaming commission Chairman Phil Hogen said his agency also is investigating allegations that Southwest Casino exerted “undue influence” while trying to get its contract renewed.

Tribal Gov. Darrell Flyingman, who was against renewal of the contract, has accused the company of taking tribal elders last fall on a gambling trip to Colorado and New Mexico. Flyingman also alleged that members were driven to tribal council meetings so they could vote on items involving the contract.

Hogen said the two tribes bypassed a requirement in their new constitution that calls for the governor to negotiate and sign casino management contracts.

The tribal council instructed Flyingman on March 31 to sign a contract with Southwest Casino within five days or the tribes' eight-person Legislature would ratify the contract. On April 14, the Legislature did so after Flyingman refused.

Southwest Casino argued the governor's role is ministerial.

“Signing when combined with negotiating is not ministerial,” Hogen wrote. “Negotiations require discretion, intelligence, knowledge, tactics and judgment, all engaged on behalf of the tribe.”

Flyingman wants to end Southwest Casino's management of the casinos in Concho and Clinton, saying the tribes could run the casinos and save millions of dollars annually.

“Our employees have been running the casino for years. What we're doing is cutting out the middle man. That's going to save us $5 (million) to $6 million a year,” he said.

The casinos will close for nine hours beginning at 3 a.m. Saturday to make the management change. Flyingman said only the general manager and another Southwest Casino employee will lose their jobs.

Meanwhile, the U.S. Bureau of Indian Affairs said Thursday it will keep recognizing Flyingman as governor of the tribes until a recall petition against him is resolved.

The tribes' acting election board secretary notified Flyingman on Wednesday of the recall petition and said Lt. Gov. Harvey Monetathchi would serve as governor until a recall election.

The BIA noted that the tribes' constitution allows the recalled official to remain in office until the election.