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01/21/98- Updated 01:34 PM ET

Indian: Politics drove casino nix

WASHINGTON - An Indian tribal leader testified Wednesday that a career Interior Department official told him political pressure influenced a decision to reject a proposed Indian gambling casino in Wisconsin.

George Skibine, former head of the department's Indian gambling office, said the decision "got too political for him to be involved," Arlyn Ackley Sr., a tribal official, testified at House hearings on the decision.

Ackley and two other Chippewa leaders testified about their allegations that politics was behind the July 14, 1995, decision to kill the casino at a Hudson, Wis., dog track near Minneapolis-St. Paul.

Rival tribes that hired politically connected lobbyists to oppose the casino eventually donated $286,000 to the Democratic National Committee. The Justice Department is considering whether an independent counsel should investigate Interior Secretary Bruce Babbitt's handling of the issue.

Ackley, chairman of the Mole Lake-Sokaogon Band, described a conversation he had with Skibine shortly after the casino permit was rejected.

Skibine's comments were "telling me it was coming from John Duffy's office," Ackley said, referring to the former counselor to Babbitt. Skibine, who told Senate investigators the decision was made solely on its merits, is scheduled to testify Thursday.

Babbitt denied in Senate testimony last fall that politics influenced the decision.

"Did Mr. Skibine make direct reference to political pressure?" asked committee counsel Richard Bennett.

"Oh yes,' Ackley replied.

Rep. Dan Burton, R-Ind., chairman of the House panel, said Interior Department documents would show that politics, not policy, determined the outcome of the licensing review.

"E-mails going back and forth among the staff ... made it clear that under the Indian Gaming Regulatory Act, this application should not be rejected," said Burton, who heads the House Government Reform and Oversight Committee.

Agency documents will show that "Babbitt's people had made up their mind that this application was going to be rejected. They just had to come up with the right justification," Burton said.

Until the decision came out, "we were led to believe our application was sound and good," said George Newago, another Chippewa chief.

Rep. Henry Waxman, D-Calif., the panel's top Democrat, complained that Republicans were not allowing elected Wisconsin officials, including GOP Gov. Tommy Thompson, to testify why they opposed the casino.

Casino opponents were not invited to testify, Waxman said, because the allegations of political influence "is a story and not fact. Any information that contradicts this theory is not permitted" at the hearings.

The Justice Department is reviewing whether an independent counsel should investigate conflicts between Babbitt's sworn testimony and that of Paul L. Eckstein, a lobbyist who said the secretary told him the White House was pressing for a decision on the issue.

Babbitt says he merely invoked the name of Harold Ickes, then deputy White House chief of staff, to get the lobbyist - an old friend - to leave his office.

The lobbyist also testified that Babbitt asked him if he knew that Indian tribes had donated $500,000 to the Democratic Party - a statement the secretary says he "has no recollection" of making.

A lobbyist hired by opposing tribes, former DNC treasurer Patrick O'Connor, personally lobbied President Clinton at a Minneapolis fund-raiser. The encounter triggered several White House queries on the status of the issue at the Interior Department.

O'Connor's diary indicates he redoubled his fund-raising efforts for the Democrats after the decision was announced.

Babbitt, who called allegations of White House or DNC influence "demonstrably false," is scheduled to appear next week on the last of four days of scheduled hearings.

By The Associated Press

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