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Casino Controversy Plagues Babbit, Reno Extends Inquiry

By George Lardner Jr. and Roberto Suro
The Washington Post

Attorney General Janet Reno Thursday 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.

Reno's action came amid a flurry of disclosures stemming from a 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."

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.