It was billed as a tidy compromise on the future of the first, and so far only, Indian casino in the Bay Area.

U.S. Sen. Dianne Feinstein would stop threatening to reverse the casino rights in San Pablo that Congress handed a North Bay tribe in 2000.

The Lytton Band of Pomo Indians could keep running their lucrative electronic bingo machines there, securing a revenue stream that exceeds $100 million a year and bankrolls the city government. But the Lyttons could not expand or offer Las Vegas-style action — slot machines — without first running a regulatory gantlet in Washington, D.C.

Two years later, the "win-win" deal is all but dead. Leaders of the Lytton Band and San Pablo now say they oppose the bargain, fearing they will come out losers if two other tribes win big casino projects nearby.

The Senate passed Feinstein's legislation in 2007 and again in March. The first bill died last year in the House Natural Resources Committee, where the current one lies dormant.

"My understanding is it's not moving anyplace," said Brock Arner, San Pablo city manager. "It would be entirely unfair to the Lytton band if there are two (Vegas-style) facilities approved in West County. Until that issue's resolved, we see no need to handcuff the Lytton band."

Both the Scotts Valley and Guidiville bands of Pomo Indians are awaiting key federal decisions on their casino bids. Guidiville wants a casino-hotel-convention center

resort at the former Point Molate Naval Fuel Depot. Scotts Valley aims for a casino with thousands of slot machines along Richmond Parkway.

The Bush administration froze those types of Indian casino applications. The Obama administration is reviewing the policy, and some say it may be more receptive.

Worries mount

The changing landscape worries the Lytton tribe and San Pablo, which relies on the casino for nearly $12 million a year — most of its general fund. If those two tribes win federal gaming rights and sign compacts with Gov. Arnold Schwarzenegger or his successor, Lytton would want slot machines too, and to expand.

"The signals we have picked up say (the Obama administration is) going to look at these projects in a new light," Lytton spokesman Doug Elmets said. "With two (Vegas-style) casinos proposed for the Richmond area, Senator Feinstein's legislation puts Lytton at a significant competitive disadvantage."

Feinstein's office seemed unaware that Lytton and the city had dropped their support for the deal. A spokesman said only that Feinstein was disappointed that the legislation has languished.

Rep. George Miller, D-Martinez, who engineered the legislation that granted Lytton its gaming rights, is a member and former chairman of the committee, which oversees American Indian issues.

"The City of San Pablo opposes Senator Feinstein's bill because it believes it would hurt the city's economy," said Danny Weiss, Miller's chief of staff. "That is a very strong consideration for not acting on Senator Feinstein's bill at this time."

Miller is taking no position on the Guidiville and Scotts Valley projects, both of which would lie in his district.

"It is up to (Interior) to evaluate petitions from tribes," Weiss said in an e-mail. "We are not involved in that process."

Miller helped Lytton skip the process with a small passage he put in a copious Indian bill in 2000. Feinstein, who opposes Indian gaming expanding into urban areas, called it "legislation done in the dead of night."

More recently, she joined Sen. Barbara Boxer, Majority Leader Harry Reid of Nevada and other senators in a letter urging Interior Secretary Ken Salazar to strictly limit "off-reservation" casino proposals. What influence they may have on the administration remains uncertain.

Pressing opposition

In the meantime, some East Bay politicians are pressing their opposition to the Point Molate plan. Last week, state Sens. Loni Hancock, D-Berkeley, and Mark DeSaulnier, D-Concord, wrote to the Bureau of Indian Affairs, claiming the draft environmental statement fails to adequately address crime, problem gambling, traffic and other impacts.

Hancock opposed the deal that the Lytton tribe and Schwarzenegger reached in 2004 for a San Pablo casino with as many as 5,000 slot machines — more than any casino in Las Vegas. State lawmakers killed that deal, leading to the tribe's compromise with Feinstein.

Hancock, too, was unaware the deal had dissolved.

"I thought it had sort of been agreed on and signed, sealed and delivered," she said. "This is one of those things you're always worried about — the moving parts."