California could soon be lighting at least some of its path out
of fiscal darkness with the flashing bulbs of expanding Indian
casinos. It's a trend, observers say, that is percolating in other
Fulfilling a campaign promise to push the state's 104 Indian
tribes to pay their "fair share" of state government revenue, Gov.
Arnold Schwarzenegger has been renegotiating federally mandated
compacts with several tribes, most of whom currently pay nothing to
Now, with two initiatives on the November ballot - Proposition 68
which could force tribes to pay 25 cents of every dollar to the
state, and Prop. 70 which would require about nine cents - Mr.
Schwarzenegger is trying to get tribes to voluntarily fork over
higher percentages of their revenues. But to do so, he is offering
them the opportunity to expand. It's a controversial tactic.
"California is in effect promoting the growth of casinos ... the
goal of getting more revenue to run the government is one of the
reasons," says Larry Berg, director of the Jesse Unruh Institute of
Politics at the University of Southern California.
Last week Schwarzenegger concluded compacts with five Indian
tribes that his staff says could produce $180 million annually for
the state. Four of the compacts will bring the state 12 to 25
percent of the casino's annual take, far more than Prop. 70, which
most analysts say is the more credible of the two initiatives.
In a fifth compact, Schwarzenegger signed a deal that runs
counter to another one of his long-held opposition to casinos in
urban areas. The Lytton Band of Pomo Indians, the northern
California tribe, would be allowed to operate a giant 2,500 slot-
machine casino in San Pablo, an eastern San Francisco Bay area city.
In a vote late last week, the California Assembly did not approve
the urban casino, but most analysts say it will have to be approved
in some form because the tribe has been given the right to run a
casino by federal law.
Federal right to run casinos
Indian gaming was approved by Congress in 1988 as a way for
isolated reservations to build up funds.
"The legislature has not yet realized that they don't get to
decide whether or not a casino goes in, they only get to decide what
is the best deal for the state," says Schwarzenegger spokesman Vince
Sollitto. He and others say the legislature will have to revisit the
issue in December or early 2005. "When they realize their
responsibility under federal law, they will realize this is the best
deal the state could get."
The four newly negotiated compacts approved by the legislature
Friday include environmental, regulatory, and law-enforcement
provisions that are more stringent than most California Indian
gambling operations so far. "These are fair-share gaming agreements
that also protect our communities," Schwarzenegger said in a
Last year, the windfall to California was about $6 billion, about
half the nation's total in collected gaming revenue. …