The Pennsylvania Supreme Court went over Philadelphia's head yesterday and cleared the way for construction to begin on the $550 million SugarHouse casino in Fishtown and Northern Liberties.

Finding "deliberate inaction" in City Council's longstanding failure to vote on SugarHouse's zoning and land-use requests, the court took it upon itself to issue the go-ahead.

SugarHouse officials said after the ruling that they expected to start construction in weeks.

The 6-1 decision also is likely to hasten the groundbreaking for the Foxwoods casino in Pennsport. Like SugarHouse, Foxwoods has been pushing for Council approval.

The city "ultimately has no discretion to preclude gaming," the court's opinion stated. "We conclude that the undisputed documentation establishes the deliberate inaction by Council for the purposes of delay."

The court ordered that SugarHouse's site, approved last December by the Pennsylvania Gaming Control Board, be granted the requisite zoning as a commercial entertainment district.

It also declared that SugarHouse's development plan, approved in May by the city Planning Commission, be given final approval with no further input from Council.

In the lone dissent, Justice Thomas Saylor said he had "substantial questions . . . in this developing area of the law" about whether the justices had jurisdiction to take such action. Saylor also expressed doubt that the court had a complete-enough set of facts, saying he favored the appointment of a special master who might first hold hearings and then report to the court.

Bob Sheldon, president of SugarHouse, said in a statement, "We are extremely pleased by [the] decision because it will allow us to begin construction almost immediately."

"The court's decision has cleared the way for both casinos to move forward by removing this final stumbling block," said Maureen Garrity, spokeswoman for Foxwoods Casino of Philadelphia. "Their good news is our good news."

City Councilman Frank DiCicco, who has led the fight against putting two casinos in his district, could not be reached for comment.

"This isn't a good night," DiCicco aide Brian Abernathy said. "What essentially the court did was neuter the Council and all of our authority."

SugarHouse asked the Supreme Court in late October to force the city to act, citing "obstructionist" political opposition. The casino's lawyers were supported by labor leaders eager to see construction begin.

SugarHouse's litigation came shortly after Mayor Street urged Council members to act, predicting that what happened yesterday - approval by the court of the plan as submitted - would come to pass.

DiCicco, in particular, argued that SugarHouse still had not come up with solutions to traffic and public-safety concerns. But SugarHouse contended that DiCicco and other Council opponents had blocked approval in ways well beyond the city's authority to regulate community impact of casinos.

The Supreme Court already had ruled that the city could not choose the sites of the casinos - a role reserved for the gambling board.

Daniel Hunter, coordinator of Casino Free Philadelphia, the city's chief anti-casino group, said his members would ask city officials to ignore the high court's ruling and refuse to issue building permits.

"We're asking for the city officials to protect the citizens of Philadelphia from major harm and to do their job, which is to not go along with the decision," Hunter said.

Casino Free Philadelphia has argued that casinos will negatively impact neighborhoods with traffic and crime, and hurt the city's economy by siphoning off money from more productive uses.

The decision undercut Mayor-elect Michael Nutter's recent push for state legislation requiring a 1,500-foot buffer between casinos and housing - a requirement that would eliminate the approved Philadelphia sites.

And though the ruling may have removed the largest obstacle for SugarHouse, several fronts remain in play.

SugarHouse received approval from the city Commerce Department last week to build on state-owned riverbed land on the Delaware River, but Council has vowed to fight that decision in court.

Casino opponents have also filed a federal lawsuit challenging the entire casino-licensing process. That case is pending.

"This really does not deter us. This actually infuriates us," said Debbie King, vice president of the Northern Liberties Neighbors Association. "We are outraged by the courts and the city government officials that are trying to jam these casinos down our throats. Where are our rights?"

In a separate development, Foxwoods yesterday announced a development agreement with the Street administration that provides $1 million annually to a special services district to offset neighborhood impacts. More important, the agreement commits up to $5 million for sewer improvements in the flood-prone area of South Philadelphia. Such agreements usually are required by the city to move forward.

SugarHouse and Foxwoods are two of five stand-alone casinos awarded licenses in December 2006. The two casinos beat out three other competitors for two licenses allocated to Philadelphia. In all, the 2004 slots law authorized 14 casinos across the state.

Contact staff writer Jeff Shields at 215-854-4565 or jshields@phillynews.com.