From the radio (?!?!), via Pechanga:
State Rep. Matt Lori reports that – after looking into the possibility of changing state gaming laws to allow the Burt Lake Band to establish an Indian casino in Sturgis – believes the chances are slim.
The Burt Lake Band has tried and failed to receive federal recognition as a tribe four times. Without federal recognition, they are unable to establish a casino under state gaming laws.
At the request of local developers hoping to bring a casino and the jobs that come with it to the area, Lori agreed to investigate whether it is possible for the tribe to gain official recognition from the state, and modify current Michigan gaming laws to allow the project to move forward. However, after consulting with legislative legal advisors and leaders in both the House and Senate, Lori said he did not believe it is a feasible option.
“I recognized the potential economic impact in terms of jobs and increased tourism a casino would bring to the area which is why I was willing to look into this issue, but it doesn’t seem possible at the current time,” said Lori, of Constantine. “The legal hurdles combined with the dynamic in the Legislature are too much to overcome.”
Senator Cameron Brown previously said he believed it would not be possible to gain recognition from the state and modify gaming laws, and Lori’s investigation confirms that position.
“From my point of view it would be fruitless to continue pursuing legislation that has very little hope of succeeding at this time. Rather than give people false hope, I think we need to move on to find another solution,” Lori said.
Lori said he is willing to meet with developers and city officials on how to best proceed.
Turtle Talk 
I’d have to think about it a bit more I suppose but it seems to me that if BLB were to be “recognized” by the state as anything other than a Historical tribe then a whole new classification of Sovereignty is declared by the State (which far over steps their legal abilities). As tribal nations we enjoy more sovereignty than the states, but not as much as the federal government (see Camby Indian Law in a Nutshell) so if there is in fact a deal between the State of Michigan and The Burt Lake Band then it would have to be similar to the Greektown Casino deal whereas Greektown is a casino that just happens to be owned by a tribe and is NOT a tribal casino.