Dreams of a $1.2 billion casino-hotel resort at Richmond's waterfront are dead.

City leaders ended a five-hour meeting Tuesday night by rejecting further consideration of the proposal, saying there are too many problems -- from traffic congestion to federal approvals -- that have yet to come.

Ultimately, they said Richmond voters made their opposition clear when they defeated November's advisory ballot measure on whether a casino should be built at Point Molate.

"This project has failed to obtain federal approval. The Bureau of Indian Affairs has not given a timetable for the decision-making process," City Councilwoman Jovanka Beckles said. "I don't think it's right nor is it fair to keep the residents of Richmond waiting for a decision indefinitely."

The 5-2 vote -- with councilmen Nat Bates and Jim Rogers dissenting -- was no surprise, given the results of November's election. Voters picked newcomers Beckles and Corky Booze, creating an anti-gaming majority on the council. They rejected advisory Measure U, with 58 percent voting no on the casino question.

Bates, a longtime project supporter, said he is saddened to see it die, in part because it would have provided jobs to locals who lack a college education and struggle to find a steady paycheck.

"I still think it's a good idea what we tried to do," he said. "I think it would have been a positive."

The City Council directed its staff to begin negotiating for 120 days with Upstream, the project developer, for a nongaming development alternative, as outlined in the 2004 deal in which the city agreed to sell Point Molate for $50 million. Jim Levine, managing partner of Upstream, is open to talks.

"We're going to wait and see what the city wants to do," he said Wednesday.

There is disagreement over when the city-Upstream contract expires. Levine think a 2004 lawsuit filed by the Citizens of East Shore Parks, which argued that the city illegally entered the deal without completing an environmental review, triggers a provision that extends the contract's expiration date by roughly two years. The city asserts that the deal expires April 20, when the most recent contract extension ends.

Upstream and the Guidiville Band of Pomo Indians have paid the city $18 million so far, including partial payment for the land and other costs, Levine said. The parties have spent about $30 million total on the project itself.

The idea of a casino-hotel resort at Point Molate dates to about 2003, back when a council majority favored gaming and prodded the project along. The plan calls for two hotels, a 122,000-square-foot conference center, restaurants, shops, tribal facilities, open space and a shoreline trail. However, it is the 124,000-square-foot gaming floor that divided the community.

With unemployment hovering stubbornly at 18 percent, supporters say the project would bring much-needed jobs and revenue to a city struggling with how to make ends meet and give residents viable economic opportunities. Opponents argue that the plan is a pipe dream that would fall short of its promise and instead bring traffic congestion, crime and addictions while sullying Richmond's image.

Another casino has been proposed in unincorporated North Richmond by the Scotts Valley band of Pomo Indians, but it has not been approved.

Tuesday's meeting drew more than 150 people on both sides of the issue, with opponents outnumbering supporters by a considerable margin. A banner dangling from the Memorial Auditorium's balcony seats read in bold lettering: "Richmond Voted No Casino."

Levine and tribe spokesman Michael Derry urged the city not to shut the door on the gaming project. They maintain that the casino is the economic engine, allowing the project to provide thousands of jobs, at least $16.6 million a year to the city, $12 million a year to Contra Costa County, and the funds to cover the massive price tag of redeveloping the old navy fuel depot, including building new infrastructure and seismically upgrading historic buildings. No other development idea has been able to accomplish the same.

The city may need to subsidize a nongaming project and should not expect help from state or federal appropriations in the near future, they added.

Cheryl Maier, a Chamber of Commerce board member, said the city should not dismiss the project.

"I know enough about economics to know there is no other way to finance such a project," she said.

Others argued an alternative plan is possible that would be better use of the land, although it may take longer to finance.

"Indian gaming is not a solution to crime in Richmond," said resident Karen Franklin. "It's a dead-end."

Katherine Tam covers Richmond. Follow her at Twitter.com/katherinetam. Stay up-to-date on West Contra Costa news at IBABuzz.com/westcounty.