California okays slot expansion

Jul 3, 2007 5:24 AM

In a victory for Governor Arnold Schwarzenegger, the California Legislature last week agreed to allow four Indian tribes to expand casino gambling in exchange for hundreds of millions of dollars in revenue to the state.

The action ended what had been a lengthy legislative logjam that pitted two special interest titans: labor groups vs. casino-operating Indian tribes. The tribes won.

Labor leaders said they opposed the deals because they did not contain enforceable provisions to protect casino employees or give unions the right to organize.

The compacts will allow four Southern California gambling tribes to add 17,000 slot machines to their casinos, a 30 percent increase in the number of slots currently operating in the state.

The issue has been divisive in Sacramento for months. Schwarzenegger and five Indian tribes agreed last year to the gambling expansion: The tribes would get to add thousands of slot machines, and in return state government would receive millions per year in badly needed revenue.

Assembly Democrats blocked the deals because labor groups, among their most important allies, objected. They wanted the right to organize casino workers and sought provisions that would force tribes to adhere to state and federal labor laws.

Schwarzenegger revived the compacts this year, pushing lawmakers to approve them as a way to help balance the state’s budget. The Senate passed them in April, but they stalled in the Assembly.

Last week, Schwarzenegger, the tribes and legislative leaders worked out a compromise in which the tribes would voluntarily agree to some concessions sought by unions and Democrats. Compacts with four of the five tribes sailed through the Assembly on Thursday after Assembly Speaker Fabian Nunez said the tribes had agreed verbally to allow unions to organize casino workers.

The four gambling tribes whose compacts won approval are: the Sycuan Band of the Kumeyaay Nation in San Diego; the Pechanga Band of Luiseno Indians in Temecula; the Agua Caliente Band of Cahuilla Indians in Palm Springs; and the Morongo Band of Mission Indians in Cabazon.

A fifth, the San Manuel Band of Mission Indians in San Bernardino, would not agree to provisions favorable to labor. That tribe’s compact, which was passed by the Senate, remains in limbo in the Assembly.

The governor’s office has estimated the gambling expansion, assuming the five compacts were approved, would pump more than $500 million a year into state coffers over the 25-year life of the agreements. The nonpartisan Legislative Analyst’s Office said the figure would be closer to $200 million next year.

The logjam cleared after the governor’s office negotiated non-binding side agreements to the existing compacts with the four tribes.

Tribal casinos across the state already operate 58,120 slot machines and took in $7.7 billion in revenue in 2006, according to a private, nationwide analysis of tribal gambling revenue released this week. By comparison, Nevada’s casinos took in revenue of $12.6 billion in 2006.