The state Supreme Court trumped City Council yesterday, ordering the city to approve zoning needed by SugarHouse, a proposed riverfront casino that has been stymied for months by governmental inaction.

That means SugarHouse can ask the city's Department of Licenses and Inspections as early as today to start the process of issuing building permits for the casino on Delaware Avenue at Shackamaxon Street.

The court slammed Council, especially Councilman Frank DiCicco, for "deliberate inaction" on legislation introduced in May to give SugarHouse the zoning it needed to begin construction. That legislation has been bottled up in a Council committee.

"A member of City Council does not have the authority to use local zoning processes to overturn the [state] Gaming Control Board's approval of [SugarHouse's] slot machine license," the court ruled, reciting quotes compiled by SugarHouse of DiCicco promising to delay construction until concerns from neighborhood residents and anti-gaming activists were addressed.

Neighbors have said the casino would be built too close to their homes and create problems with increased traffic and crime.

SugarHouse and a second proposed casino, Foxwoods in South Philly, are located in DiCicco's riverfront district.

DiCicco was sidelined yesterday by pain medication for a back ailment. His aide, Brian Abernathy, said Council is still considering its next legal option.

"What I find most disturbing about this ruling is it essentially takes a legislative body and neuters it," Abernathy said.

The legal challenge, filed in October, pitted SugarHouse and a sympathetic Mayor Street against Council and state Sen. Vince Fumo, who went to court to oppose SugarHouse's suit.

City Solicitor Romulo Diaz noted that he has repeatedly warned Council this year that stalling tactics could lead the court to take away its local zoning control. Diaz, in court filings, said Street's administration did not oppose SugarHouse's legal argument.

Gov. Rendell also supported SugarHouse's fight for zoning.

Asked if the ruling could mean the court is willing to push zoning for Foxwoods, which has also been stalled, Diaz said: "It would seem that the approach that has been pursued by City Council has not been favored by the Pennsylvania Supreme Court."

Foxwoods agreed, hailing the court's ruling as a sign that it, too, is entitled to zoning.

"The court's decision has cleared the way for both casinos to move forward by removing this final stumbling block," Foxwoods spokeswoman Maureen Garrity said.

Christopher Craig, an attorney on Fumo's staff, vowed yesterday that the "fight is not over, not by a long shot."

Craig accused the court of ignoring the state's Gaming Act, which gives municipalities zoning control for casinos after locations are chosen by the Gaming Control Board.

Supreme Court Justice Thomas Saylor filed a lone dissent for yesterday's ruling, questioning whether the court should act without first appointing a "special master" to conduct hearings on SugarHouse's complaints.

Saylor refers to a ruling by the court last month, dismissing a similar lawsuit by Foxwoods because the proposed casino did not demonstrate that it had been denied zoning by the city. That case was sent to the Philadelphia Court of Common Pleas for further action.

The court's ruling sets the stage for a new phase of anti-casino action, moving from Council's chambers and courtrooms to the weed-strewn Fishtown lot where SugarHouse would be built.

Daniel Hunter, of Casino-Free Philadelphia, said his organization will urge city employees to "engage in resistance" by slowing down SugarHouse's building permits and losing files. He also said activists are considering "direct action," including lying down in front of the bulldozers expected to work on casino construction or occupying the location.

"All of those are still on the table for us," Hunter said. *