Elections

Prop. 48 revives California’s off-reservation casino debate

Sacramento

Proposition 48, a referendum on two tribal gaming compacts brokered by Gov. Jerry Brown and approved by the Legislature, will ask voters whether they want to uphold the deals. Massive gambling revenue is on the line, as are questions about the growing phenomenon of “off-reservation” Indian casinos in California.

Proponents of Proposition 48 – including the North Fork Rancheria Band of Mono Indians, the Wiyot tribe and their financial backers from Station Casinos in Las Vegas – argue that the proposal to build a 2,000-slot-machine casino off Highway 99 in Madera would create an economic engine in a depressed region of the Central Valley and allow the North Fork tribe to reclaim part of its historic land.

But the casino site is not on the North Fork Rancheria in the mountains near Yosemite, and that’s part of the problem for opponents of the initiative. They make the case that the deal opens the door for more casinos outside established reservations, a limitation that voters approved in a 2000 proposition.

The campaign also features a financial rivalry: The main funders of the “no” campaign are other tribes whose own gaming operations would face more competition with construction of the North Fork casino, as well as their East Coast investors. As of Thursday, they had raised $7.8 million to $418,000 for the casino backers.

The compacts in question required an unusual approval process because the casino would be off the reservation. The federal government was required to determine the project was in the best interest of the tribe and not detrimental to the community.

What it does

▪ A “yes” vote will ratify a state law passed by the Legislature and signed by Gov. Jerry Brown that ratified casino gambling compacts with two tribes, the North Fork Rancheria of Mono Indians (Madera County) and the Wiyot tribe (Humboldt County).

▪ A “no” vote negates the law and the compacts.

▪ The compacts allow a casino on nonreservation property in Madera and prohibit one on Wiyot land, but let the Wiyot tribe receive 2.5 percent to 3.5 percent of slot-machine revenue from the North Fork operation.

▪ The compacts require payments to the state revenue-sharing fund that provides money to 73 tribes that either have no casino or have a casino with fewer than 350 slot machines.

What it costs

▪ The Legislative Analyst’s Office estimates the casino would make one-time payments of $16 million to $35 million for Madera County and the city of Madera.

▪ While the casino would generate economic activity in Madera, it would draw customers from other tribal casinos in California.

Who’s for it?

▪ North Fork Rancheria of Mono Indians

▪ Gov. Jerry Brown

▪ Station Casinos

▪ California Democratic Party

▪ Madera County Board of Supervisors

▪ California Labor Federation

Who’s against it?

▪ Table Mountain Rancheria

▪ Sen. Dianne Feinstein, D-Calif.

▪ Brigade Capital Management

▪ Fresno County Supervisor Henry Perea

▪ Nisei Farmers League

▪ State Sen. Jim Nielsen, R-Gerber

Major contributors

For

▪ Station Casinos, which would oversee construction and manage the North Fork casino, has given $395,000 of the $418,000 raised by supporters.

▪ The California Democratic Central Committee has contributed $15,000.

Against

▪ Table Mountain Rancheria, which runs a casino north of Fresno that would compete with the new casino, has kicked in $10.95 million of the nearly $15.96 million raised by opponents.

▪ The Chukchansi Gold Resort & Casino, which is closed indefinitely but is another potential competitor, gave $500,000.

▪ Three East Coast-based investment firms – Brigade Capital Management ($3.67 million), Riva Ridge Capital Management ($226,000) and DG Capitol Management LLC and related entities ($113,258) – have given about $4 million. Brigade is a financial backer of the Chukchansi operation.

▪ United Auburn Indian Community, which operates the Thunder Valley casino near Rocklin, has given $250,000.

How true are competing claims?

Proponents

▪ Approving the compact will authorize a project that is strongly supported by the local community because it creates jobs and will boost the economy.

The North Fork tribe’s reservation near Yosemite is far from populated areas. Almost a fifth of Madera County residents live in poverty, the fifth-highest rate among California counties, according to the latest census information. Local support for the pact, though, is not universal. Madera County Supervisor David Rogers said the project would bring more traffic, pollution and crime to his community.

▪ Opponents of the project are rich gambling tribes that fear competition.

Wealthy, politically powerful tribes with casinos, such as the United Auburn tribe in the Sacramento area and the Pechanga Band of Luiseño Indians near Temecula, lobbied heavily against the June 2013 bill ratifying the North Fork agreement last spring. Table Mountain Rancheria in Friant, about 20 miles east of Madera, and the Chukchansi Gold Resort & Casino have mostly bankrolled the campaign against the pact.

Opponents

▪ The compact will start a run on “reservation shopping” – tribes building casinos away from their land – and there are enough casinos in California.

Lawmakers are considering another off-reservation pact between the Brown administration and the Estom Yumeka Maidu Tribe of the Enterprise Rancheria that would allow the tribe to build a casino in Yuba County. There are proposals, meanwhile, to build tribal casinos near Galt and other populated areas, and some would-be tribes backed by investors have sought federal recognition. But each compact is considered on a case-by-case basis. There are nearly 60 tribal casinos in California, and voters may weigh that against whether it’s fair that only tribes with reservations along major roads get profitable casinos.

▪ The project provides no payments to the state.

Unlike some past tribal gaming pacts, the North Fork casino deal would provide no money for California’s general fund, the source of money for schools, health care and other state services. That’s because a 2010 decision by the U.S. 9th Circuit Court of Appeals in a case involving the Rincon Band of Luiseño Indians essentially made such deals illegal. Since then, tribal agreements have included revenue-sharing payments to government funds with a direct link to mitigating casino impacts or helping poor tribes. The North Fork compact includes such provisions.

Call The Bee’s Alexei Koseff, (916) 321-5236. Follow him on Twitter @akoseff.

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