SOUTH KINGSTOWN — After refusing for more than two years, the Narragansett Indian tribe has collected its $1.54-million share of the slot revenue at Twin River.

Whether a portion of those profits should go to one of the tribe’s casino partners has yet to be decided by the courts.

The Narragansetts accepted the money about two weeks ago in light of grim economic times and dwindling federal aid, Chief Sachem Matthew Thomas said yesterday.

“The bottom line is finances. It’s tough out there,” Thomas said. “We do need these funds, but it doesn’t mean we’ll give up our rights to gaming.”

The Charlestown-based tribe has seen its aid drop from $6.5 million to $4 million in the past six years, he said.

At Governor Carcieri’s urging, the General Assembly struck a deal in 2005 that gave the tribe 5 percent of the revenue generated by new slot machines at what was then known as Lincoln Park. The law establishing the payment cleared the way for the sale of Lincoln Park to BLB Investors.

At the time, the tribe was focused on building its own casino in West Warwick. Since December 2006, the Narragansetts had refused to take their share because of unexplained concerns about the law’s language.

Last year, the law was changed to give the tribe .17 percent of all slot revenue at Twin River. The obligation grew to $1.545 million as of April 30, said Jeff Neal, spokesman for the governor.

The money, which comes from state lottery revenues, was logged for state budgeting purposes as a liability and transferred to the tribe June 4, he said.

The law specifies that the money be placed in a Tribal Development Fund dedicated to promoting home ownership and improvements, elderly housing, adult vocational training, health and social services, childcare, natural-resource protection and economic development. The payments will stop upon the opening of any gambling establishment from which the tribe received money or other incentives. The payments may not be used to pay off debts.

The tribe will use the slot money to provide services to its 2,500 or so members and for economic development initiatives, Thomas said yesterday.

Meanwhile, one of the tribe’s previous casino partners, Capital Gaming International Inc., argued in Washington County Superior Court yesterday that the 2005 law triggered an agreement that demands that the tribe repay the company $10 million in expenses. Capital Gaming filed suit in 2006, trying to recoup money from its casino effort with the tribe in the late 1990s.

“Our position is the note’s been triggered,” said Paul Beckwith, of Cooley Manion Jones LLP.

Beckwith argued that the payments kicked in a promissory note that the company signed with the tribe in 2001 that says the Narragansetts must repay its debt within 60 days of the “opening of any gaming, casino, or similar facility, project or enterprise” involving the tribe.

In addition, the tribe breached the contract by not keeping Capital Gaming apprised of the 2005 law (which gave the Narragansetts a share of the slots revenue) and the tribe’s casino quest with Harrah’s Entertainment, Beckwith said.

But the tribe’s lawyer, John F. “Jack” Killoy, countered that the Narragansetts didn’t request, lobby for or participate in drafting the 2005 law that gave the tribe a share of the slot money.

He characterized the law as a political opportunity for Governor Carcieri “to thwart the efforts of the tribe to be successful on the casino referendum.”

The next year, voters widely rejected a proposal to change the state Constitution to allow the tribe to build a casino in West Warwick with Harrah’s.

The note has not been triggered, Killoy said, because “there is no casino gaming revenue because there’s been no casino opening.” Furthermore, he said, the law specifically bars the tribe from using the money to pay debts.

Both sides asked Judge Stephen P. Nugent to rule in their favor yesterday, but instead the matter will head to trial.

“The fact is the language in the note … is subject to different interpretations,” Nugent said.

The resolution of the case would rest on the intentions of the people who reached the repayment agreement in 2001 and their credibility, Nugent said.

kmulvane@projo.com