Jerk the Strings

Minnesota Monthly, October 2001
By Nick Coleman


The guy with the money makes the rules, and Ralph Engelstad's got $100 million for UND plus a few minor demands.

Ralph Englestad has thrown huge parties to celebrate the birthday of Adolf Hitler, but says he isn't a Nazi sympathizer. Ralph Engelstad says he has given $100 million to the University of North Dakota, but hasn't given the money to the school; instead, he has used it to build a hockey arena cum monument to himself that may be the most lavishly appointed sports arena in the world. And although he says his intent is to honor American Indians, the Indians repeatedly have asked him to leave them out of it. If you're a tad perplexed, welcome to North Dakota welcome to Ralph's World.

First, let's try to clear up that nagging little Nazi thing. True, the Nevada Gaming Commission discovered that Engelstad, Thief River Falls native and owner of the Imperial Hotel in Las Vegas, had thrown two garish birthday bashes for Adolf Hitler in the late 1980s--big, rollicking soirees that featured German beer hall music, sheet cakes decorated with swastikas, matching portraits of Adolf and Ralph in German uniforms, and bartenders in T-shirts that said, “Adolf Hitler European Tour--1939-45.

But Engelstad apologized for the parties, which he said were burlesques, and paid a big price in public humiliation as well as a near-record fine of $i.5 million for bringing disrepute to the Nevada gaming industry (no easy task). Today, Engelstad would like to put the memory of Hitler behind him and be remembered, instead, as a generous philanthropist who, nearing the end of his career. gave an extraordinarily large gift to his beloved alma mater, the University of North Dakota: One hundred million dollars.

If it were only that simple.

The $100 million gift, announced in late 1998, was one of the 10 largest ever made to an American university. At the time of the announcement, half of the money was earmarked for a state-of-the art hockey arena for the university where, a half-century ago, Engelstad once played goalie. The other half-or whatever was left after the arena was completed-would go for whatever purposes the university chose. In the end, however, it didn't work out that way. The arena, scheduled to open this month, ate the whole $200 million.

For a small, state-funded school on the windswept Red River flats of Grand Forks with an annual budget of only $250 million, a $100 million gift from a Las Vegas high roller was an offer too good to refuse. But today, as the spectacular, no-expense-spared Engelstad Arena prepares to open its doors, some North Dakotans are wondering if they've accepted a Trojan Horse and made a deal that will cost their university more in the public arena than it could ever gain in one with ice.

It looked like Engelstad would make a smooth transition from embarrassment to benefactor until he sent a letter to the president of the University of North Dakota last December containing few of the niceties you expect in academia. It was blunt and to the point, and written in the gruff, no-nonsense style of a Las Vegas entrepreneur.

Mr. Engelstad had run out of patience with his old alma mater.

Engelstad, a 70-year-old entrepreneur who also owns the 32-story Imperial Palace hotel and casino in Biloxi, Miss., is used to getting what he wants. Often included on lists of the most wealthy Americans, Engelstad is worth a half billion or so and owns three jets, including two personalized Boeing 727s complete with bedrooms and showers.

They say money talks and bullshit walks. Engelstad's money was about to speak up.

Two years after pledging his $100 million, he warned university President Charles Kupchella he was on the verge of walking away from his promise and abandoning the mammoth hockey arena that was being built on the edge of the campus.

“It is a good thing that you are an educator because you are a man of indecision,” Engelstad told Kupchella in his letter. “If you were a businessman, you would not succeed. You would be broke immediately.”

Kupchella had become UND president in 1999, after Engelstad had announced his gift. But he had begun to run afoul of Engelstad on an issue that was dear to the casino owner's heart: The school's troublesome “Fighting Sioux” nickname for its athletic teams.

“I'm not going to comment on it (the letter),” Kupchella told me in a recent interview. “But obviously, I didn't like the letter very much.”

Kupchella had appointed a committee to study the school's nickname, which has drawn protests from American Indian activists for years. Although he never has officially disclosed his preference, he apparently advised the state's Board of Higher Education-the university's ruling body-that he was thinking of dropping the name, bowing to the near unanimous feelings of the state's many tribal councils.

“I seen no choice but to respect the request” of the tribes, he had said in a December e-mail that surfaced later. A few days after Kupchella's e-mail, on Dec. 20, 2000, Engelstad's letter arrived. It wasn't a threat. It was a promise: If Kupchella changed the name of the university's “Fighting Sioux” teams or banned the Indianhead logo used by the school's hockey team, Engelstad would withdraw his $100 million pledge and leave the half-built arena (approximately $35 million had been spent on construction) unfinished, turning off the heat and allowing the North Dakota winter to “completely destroy” the building, putting hundreds of construction workers out of jobs and--not incidentally--enraging many of UND's hockey fans and alumni.

The very next day, the Board of Higher Education, meeting in an unscheduled teleconference, stepped in to reassure Engelstad, voting 8-0 to pass a measure saying that the University of North Dakota's team would always be the “Fighting Sioux” and that the school's new Indianhead logo would remain. Arena construction continued, and the controversy began.

It isn't likely to go away soon, not even when the new Ralph Engelstad Arena--festooned with hundreds of “Fighting Sioux” slogans and Indianhead logos--opens Oct. 5-6 with a hockey series pitting North Dakota against the University of Minnesota. Far from being settled, the battle over Engelstad Arena has raised thorny questions about big-dollar contributions from controversial alumni and the funding of college athletics. What we have here, in Ralph's World, is a story of big bucks, big egos, and a big headache.

Although he spends most of his time in Las Vegas, Engelstad has a powerful presence in Grand Forks, where he occasionally arrives without notice aboard one of his personal airliners (he hasn't flown commercially for more than 20 years, he recently told the Thief River Falls newspaper, apparently in the belief that security is lax on commercial airlines) to meet privately with old friends or to tour his new arena.

Mention “Mr. Engelstad” or” Ralph” in Grand Forks, and you have peoples' attention in a city that has been hard hit by the floods and economic downturns but where a sprawling new arena represents a symbol of hope. Engelstad has become the local Howard Hughes, an apt comparison for penchant for having things his way. As a matter of fact, Engelstad made his first big business score off of Hughes, reaping millions in the 1960s when he sold land to Hughes for a private airport outside of Las Vegas.

Engelstad was born in Thief River Falls, Minn., in 1931 and was a high school hockey player who played in the first Minnesota High School Boys Hockey Tournament in 1945. When he was 17, he got a summer job unloading boxcars. One of his fellow laborers was a professor from the University of North Dakota who took Engelstad under his wing, suggesting that he come to Grand Forks. He did, and the professor arranged a scholarship for Engelstad and helped him get on the university hockey team, where he played goalie from 1948 to 1950. Without this mentor's help, Engelstad has said, he never would have gone to college. After graduating, Engelstad started a construction business, parlaying a $2,500 loan into a thriving company. In 1959, he moved to Las Vegas and started buying real estate around the booming city, including the old Flamingo Capri Hotel on the Las Vegas Strip, which he converted in 1980 into the Imperial Palace, a complex boasting one of the largest hotels in the world (2,700 rooms) and the largest privately owned casino in Las Vegas. He also, his critics say, started cutting himself off from the world, la Howard Hughes, living and working in one of the hotel's five towers, seldom leaving the building.

Engelstad typically refuses requests for interviews, but granted one to his hometown newspaper in Thief River Falls in 1999. In it he said that he hates the media and politicians (“What 1 think of politicians I don't think you could print.”), that he has received death threats, and that he is angry over the rise of gambling casinos on Indian reservations, which, he complained, get unfair tax advantages. He also revealed his homespun mottoes, the secrets of his hard-won success: “No dream comes true until you wake up and go to work,” and, “The harder I work, the luckier I get.”

“Ralph is very misunderstood,” says Earl Strinden, a close Engelstad associate who has headed the UND Alumni Association for many years and who is one of the few who get to see Engelstad when he drops in on Grand Forks. “If he had the spinmeisters around him, he'd do a lot different.”

In 1987, Engelstad and his wife. Betty, announced a $5 million gift to the university. (They also contributed at least another $2 million, as well as a collection of the late Gen. George S. Patton's books and papers, valued at more than $i million.) In gratitude for that early gift, the university renamed its winter sports center, a modest, 5,800-seat arena, the Ralph Engelstad Arena. Then Engelstad's Nazi fixation burst into the open.

Engelstad was discovered to have presided over at least two mock birthday parties for Hitler in a secret “war room” in his casino. A major collector of Nazi memorabilia (his collection included a Hitler staff car and other vehicles displayed in a museum in the casino), Engelstad claimed the parties were jokes, that he loathed Nazism, and that he had done a lot of business with Jewish people. The university dispatched a delegation to Las Vegas to look into the matter, which concluded that Engelstad wasguilty mostly of poor judgment. In Las Vegas, remarked one UND official, with all those blinking lights and show girls and parties, well, it was easy to fall victim to bad taste.

Engelstad's $5 million gift earned notoriety for North Dakota and was featured prominently on a list of dubious contributions accepted by institutions of higher learning from alumni whose fortunes were tainted. England's Oxford University returned a donation from the grandson of a notorious Nazi sympathizer after faculty members protested, and Augsburg College in Minneapolis discovered it had accepted $500,000 from a racist who had written thousands of anonymous hate letters to people of color. Augsburg kept the racist's money but took his name off a building. In Grand Forks, the University of North Dakota kept Engelstad's money, left his name on the ice arena and--as it turns out--set in motion another controversy.

“Money is running the university,” says Mary Jane Schneider, chair of UND's highly respected Indian Studies Department. “And Ralph Engelstad has more money than anyone else.”

Schneider resigned last spring from a committee appointed by Kupchella to find ways to make the University into a “premier” center of learning for American Indian students. Her resignation came after the new Indianhead logo was painted at center court of the school's gymnasium.

“We don't put things we're supposed to respect--and people, in particular--on the floor for people to walk all over,” she says.

Kupchella since has ordered the logo removed, but frustration over the nickname and logo continues among many faculty and students. Ugly racial incidents--mostly name calling--have continued to occur on campus, Schneider says. And it's hard to understand how UND can aspire to become a premier center of American Indian learning while at the same time continuing to promote what many deem to be negative stereotypes of American Indians. About 350 American Indians attend UND, representing 3 percent of the student body of 10,000. Three-quarters of the Indian students objected in a recent poll to the Fighting Sioux nickname. Non-Indian students, however, favored the name by an even larger margin.

Originally known as the Flickertails, the university's teams got a new moniker in the 1930s after students pushed for something punchier. They chose “Sioux,” the common (and often considered derogatory) term for the Dakota and Lakota tribes that once roamed freely through much of what is now Minnesota and the Dakotas before being confined to reservations in the late 1800s. The modifier “fighting” came later. So did the controversy.

In 1972, during the school's winter carnival, a fraternity erected a snow sculpture depicting a comely Indian maiden with her legs spread, along with the slogan, “Lick'em, Sioux” Only a few years earlier, elders of one Lakota or Dakota tribe had given a university president a feather war bonnet and “permission” to use the Fighting Sioux name. Whether the elders were speaking for all Lakota and Dakota in the state is doubtful; what is certain is their “approval” came before the dawning of the American Indian Movement, the awakening of a militant pride among Indians, and the drive to eliminate offensive stereotypes that has resulted in hundreds of schools changing their nicknames. Protests and violent incidents followed the obscene snow sculpture, and UND President Thomas Clifford ordered an end to many offensive symbols and campus traditions, including a cartoon caricature called “Sammy Sioux” and the school's original Indianhead logo, based on the logo of the National Hockey League's Chicago Blackhawks.

The logo was replaced by the use of a more abstract, geometrically shaped Indianhead symbol. There was one important exception, however: The UND hockey team was allowed to keep the Blackhawks-styled logo until 1993, when it was done away with, prompting a petition drive by alumni hockey players to have it restored. The leader of the petition drive? Ralph Engelstad, of Las Vegas. Many North Dakotans suspect Engelstad's $100 million arena is his last, massive attempt to chisel the Indianhead logo permanently on the state.

The issue of the nickname and logo has never gone away. In 1992 the same tribe that supposedly gave permission to use the Fighting Sioux nickname in the late 1960s requested that the name be dropped Since then, six other tribal councils have asked the university to change the name of its teams. With the issue again heating up, Kupchella formed a commission to study the question, even as the Engelstad Arena was beginning to be built on a 50-acre site on the edge of campus.

“I believe there's a relationship between keeping the `Fighting Sioux' name and the negative attitude of some people towards Indians,” Schneider says. “By keeping the name, we are doing to Indians what has been done to them for 400 years--telling them their opinion doesn't count. But Engelstad is controlling the issue, and he is sort of controlling the whole university.” Kupchella strongly denies that Engelstad is controlling the university. If it ever came to a showdown between the school president and the casino owner, and Kupchella wound up losing, he says, “I'm packing my bags.” He admits that “he who pays the piper” wants to call the tune and that colleges often receive gifts that come with strings attached. But on the name issue, Kupchella says he finds himself “right in the middle.”

Although he may have been on the verge of retiring the nickname before Engelstad short-circuited his decision-making process last winter, Kupchella worries now, he says, that the arena has raised the stakes on the issue to the point where if the Fighting Sioux name were removed, there might be a negative impact on American Indian studies.

“If this name and tradition were abruptly terminated, the rebound could set back relations between Indian and non-Indian here for years,” he says, carefully weighing his words. “And it'd be far worse than the real or imagined use of the nickname.”

If you like the new Xcel Energy Center, St. Paul's home for the Minnesota Wild NHL hockey team, you'd love the new Engelstad Arena in Grand Forks. Although only about two-thirds the size of Xcel, the 400,000-square-foot, 11,500-seat Engelstad is more spectacular. Moreover, it will far outshine the University of Minnesota's $55-million Mariucci Arena in terms of amenities, training facilities, and sheer opulence. North Dakota is proud of its hockey team, which has won four more Division I national championships than the Gophers, and it has decided not to be shy about asserting its bragging rights.

Granite, imported from India, lines the floors, hallways, counters, and rest rooms. The rest rooms feature wall mounted closed-circuit televisions (there are some 300 in the arena) with a surround-sound system so that hockey fans emptying their bladders won't have to miss any action.

Forty-eight luxury suites, each renting for up to $40,000 a year, feature refrigerators, wet bars, Internet access, and private bathrooms. The suites have all been rented through 2003.

There's a $12 million, 15-ton, state of-the-art scoreboard, an electronic scoreboard encircling the inside of the arena, and a dasher-board sound system that will amplify the sounds of players crashing into the boards.

A 10,000-square-foot training center lets players work out on weight machines or exercise on a spring-loaded wooden floor designed to bounce gently without causing injuries. The center has a sauna and a hot tub, each big enough for 24 hockey players at a time, plus a therapy pool, with underwater cameras, designed to help players recover quickly from injuries.

The home team locker room? Cherry and oak wood lockers.

“When you stick $100 million into a building in North Dakota, you get a lot,” says Chris Semrau, a recent graduate of UND and former student body president who now works for Engelstad. “Cheap labor,” Semrau explains while giving me a tour of the arena, adding that it would cost much more to build an arena like this in the Twin Cities, where union labor and higher material costs would have added millions. “Mr. Engelstad is very much anti-union.”

Engelstad operates one of the only non-union hotels in Las Vegas. He has been intimately involved in construction of his namesake arena, a monument to his lifelong love of hockey and the University of North Dakota. “He doesn't miss a beat, or a penny,” Semrau tells me, “Mr. Engelstad is very much involved-he knows every bolt that goes in that building.”

As student president, Semrau vetoed a student senate decision to drop the Fighting Sioux nickname. Now he shows visitors the large plantings outside the arena, huge flower and shrub gardens that--visible only from the sky over Grand Forks--spell out “Fighting Sioux.”

The giant message aimed at the sky might be Engelstad's way of saying Ralph Built This, and He Will Call Them the Fighting Sioux If He Wants To. Given the sensitivities that surround the nickname issue, you might think the name would be subtly soft-pedaled at the new arena. You might think that--if you knew nothing about Ralph Engelstad.

The Fighting Sioux nickname and the new Indianhead logo are everywhere in, on, and around the arena. They're on the building's exterior. They're set at regular intervals in the granite floors (meaning, of course, that the Indianhead, with its four eagle feather symbols of honor, will be trod upon by hockey fans). They're at the end of each row of seats. There are hundreds of them, possibly thousands. If Ralph Engelstad is worried that the university might some day try to rub out the nickname, lie has made sure it will be a gargantuan task.

“Then the jackhammers come out,” says Schneider. “But right now, the university doesn't own it, and we can't do anything about it.”

That's another huge wrinkle: Amazingly, the university doesn't own the arena. Instead, in a unique arrangement dictated by Engelstad, the arena is owned and managed by one of his companies, which will “rent” it to the university for $1 a year and give the school all of the revenues, above operating expenses. In the first year, an estimated $1 million or more is expected to go to the university, twice the revenues derived from the old, smaller arena. But until Engelstad turns over the keys to the arena, which he says he intends to do at some point in the future, the university can do nothing. As long as the Fighting Sioux name is threatened, Engelstad will control his arena.

Protests are scheduled to coincide with the arena opening. Indian activists and student organizations will gather in Grand Forks for a “Fighting the Fighting Sioux” conference on the issue of Amcrican Indian nicknames.

“The Fighting Sioux name functions not like an honor but like a trophy taken in warfare,” argues an opponent, UND law student John Hoff. “It's being waved over their heads like a skull-like saying, `I have taken your strength.-Hoff, a member of the Green Party, served on Grand Forks City Council before being unseated in a recall election. “The university was getting ready to change the nickname when Ralph threatened to let the arena rot. Then they cowered in fear. People here don't understand what a public relations nightmare they have going--they don't get that the name of North Dakota has been associated with racism all over the country.”

The state has, indeed. taken some. big PR hits. Last February, The Chronicle of Higher Education published a major story on the Engelstad controversy, reporting that many in the university fear him as “a ruthless businessman intent on getting his way-regardless of the impact on American Indian students.” One American Indian student quoted in the story said he left the university after having his life threatened when he took a leadership role in challenging the team name. The story also included titillating nuggets such as the fact that the delegation from the university that had visited Engelstad in Las Vegas in 1988, after the Nazi stories first surfaced, were astonished to find that he kept a bust of Hitler in his office. “It's all way too juicy for words,” says the embattled Kupchella.

Is Ralph Engelstad a racist' He has said he is not, repeatedly and over many years, ever since the 1986 and 1988 Hitler parties became public. They were held in a room where Engelstad kept World War II memorabilia, swastika banners, Nazi weapons, and murals of Nazi leaders. On one wall was a life-size portrait of Hitler inscribed “To Ralphie from Adolf, 1939.” On the other wall was a portrait of Engelstad Wearing a Nazi uniform. inscribed “To Adolf from Ralphie.”

If it was supposed to be funny, a lot of people didn't laugh. including the Jewish community in Las Vegas and the Anti-Defamation League. Engelstad's supporters are incensed when critics refer to him with the “N” word. But as Hoff puts it: “If you can't call a guy who liked to have birthday parties for Hitler a Nazi. who can you call a Nazi' Excuse me, but he had a painting of himself in a Nazi uniform!”

Engelstad issued a statement that the painting was a joke, that his interest in Nazi relics, was purely historical, and that “I despise Adolf Hitler and everything he stood for.” He reminded the public he sponsored a free senior citizens Christmas party each year, and mentioned his $5 million gift to UND.

Later, Las Vegas newspapers reported that several hundred bumper stickers reading;”Hitler Was Right” had been printed at the Imperial Palace and that state gaming agents believed Engelstad had known of this. He apologized again, taking out newspaper ads calling the Hitler parties “stupid and insensitive,” according to License to Steal (University of Nevada Press), a book published last year on Nevada's gaming industry by Jeff Burbank.

Jewish groups protested outside Engelstad's casino, countered violently by skinheads who demonstrated on behalf of Engelstad's right to enjoy Nazi memorabilia. Engelstad offered to donate his collection to the Holocaust Museum in Washington, D.C.: museum officials declined. The Nevada Gaming Control Board threatened to revoke Engelstad's gaming license but allowed him to retain it after he paid a $1.5 million fine, apologized for any harm done to the state, promised not to hold any more Hitler parties or publish any materials glorifying the Third Reich, and agreed to display signs in his vintage auto collection that the World War II vehicles on hand were not intended to honor Hitler.

True, as Kupchella points out. the whole thing was 13 years ago: “There's nothing I know of since.” On the other hand, it also is true that the university has accepted a $100 million gift--which it doesn't control--from a man under orders, at the threat of losing his business empire, to refrain from throwing more parties for Adolf Hitler.


In the meantime, as hockey fans, alums. and activists converge on Engelstad Arena for this month's grand opening ceremonies and protests, the ultimate comment on the situation might be the poster in a University of North Dakota campus hallway that shows a beaming Aryan maiden of the Third Reich, holding a coin box in her outstretched hands. The poster says: “Heil, benefactor!”

Nick Coleman is a columnist for the St. Paul Pioneer Press.