Indian Tribe Scales Back Casino Plans : Gambling: Agua Caliente officials will open smaller card club at Spa Hotel, possibly as early as April. They still plan a free-standing facility with Caesars World.

PALM SPRINGS —  Stymied in its efforts to construct a $25-million downtown casino, the Agua Caliente Indians announced plans Friday to open a smaller card club at their Spa Hotel and bring gambling to the desert resort town by April.

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The card club, to be in a 9,000-square-foot convention room at the 240-room downtown hotel, will provide the tribe with an immediate source of new income, tribal Chairman Richard Milanovich said.

The tribe will continue its efforts to develop a larger, free-standing gambling facility with Caesars World, Milanovich said.

The state has sued to block development of the Caesars casino, contending that a land swap between the tribe and the city to facilitate the project is against the law.

The smaller gambling hall, Milanovich said, will offer various card games, including poker and popular Asian games, but it will not offer high-stakes bingo or electronic slot machines. Other Native American tribes in California flaunt the use of the video gambling machines despite court rulings that they violate state law--an issue that is entangled in the courts.

Tribal attorney Art Bunce said the tribe--whose checkerboard reservation includes half of Palm Springs and neighboring communities--has sued the state to force removal of state Lotto and Keno games from retail businesses that lease land from the tribe.

“The state won’t negotiate with this tribe to allow Class Three (electronic slot machine) gaming, yet they are playing their own Class Three games on Indian reservation land,” Bunce said.

Deputy State Atty. Gen. Manuel Medeiros said his office realized only last year that the state’s lottery and other games were being played on tribal land, and has been working since then to identify which retailers are situated on tribal land.

Because of confusing land title searches, identifying which lottery operations must be removed has proved difficult, Medeiros said.

“But we’ve already told the tribe that once we know which retailers are on tribal land, we’ll pull our games out of there,” Medeiros said.

Milanovich said the card club at the Spa is considered an interim gambling facility until a larger one is built, either at the proposed site or elsewhere in Palm Springs. The smaller club, he said, will be managed and operated by the tribe itself.

The city has embraced the larger Caesars casino project because of a revenue-sharing agreement between the tribe and the city and because it would provide an economic boost to downtown tourism, Palm Springs Mayor Lloyd Maryanov said.

The smaller card club would provide no revenue to the city, and because of its location at the tribe’s hotel, it would not provide as much spillover revenue to other downtown businesses, he said.