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Report cites impact, growth of tribal gaming in California
Thursday, June 1, 2006

California'a tribal casino industry has exploded in the past eight years, helping the state become a $13 billion gaming giant, attorney general Bill Lockyer announced on Wednesday.

About half of the state's 100-plus tribes are engaged in gaming. Their facilities brought in an estimated $5.78 billion in 2004, a 36.5 percent increase from $3.67 billion in 2002, Lockyer said in presenting the results of a new state report.

Indian gaming has generated tens of thousands of jobs, improved the quality of life for tribal members and helped rural communities, the report determined. But the rapid growth of the industry, and its impact on urban areas, require careful consideration, Lockyer said.

"These changes present significant challenges for the publi policymakers and regulators as we seek to successfully address the many issues associated with the integration of gambling into the state's social and economic life," Lockyer said. "With its wealth of updated information, this report should prove very useful to decision-makers as they confront these challenges."

"Gambling in the Golden State: 1998 Forward" was written by the California Research Bureau at Lockyer's request. It provides the most detailed and most timely information about a wide range of gaming activties in the state, from tribal casinos to the state lottery to card rooms and race tracks.

Tribes are by far the largest stakeholders. They started out with about 14,000 slot machines and about 500 table games in 1996, the report said, taking in an at least $652 million.

Tribes now operate over 58,000 slot machines and more than 1,800 table games, the report said. With more tribes seeking to get into the business -- including 24 with pending gaming land appplications -- the figure could grow even higher in the coming years.

The benefits include jobs, revenues and taxes, the report said. But the negatives include crime, problem gambling and displacement of non-tribal businesses in urban areas, the report added.

A significant portion of the document is dedicated to two major controversies in the state: revenue-sharing compacts and off-reservation gaming. Although the report presents both sides of the issues, it appears suggests more sharing by noting that tribes paid "less than one percent" of revenues from 2001-2004 into two state revenue-sharing funds.

"Recently-negotiated compacts with the state will increase the tribes' revenue sharing responsibilities," Lockyer's office said in presenting the summary of the report.

The comments drew a quick response from the California Nations Indian Gaming Association, the largest inter-tribal organization in the state. CNIGA said the revenue-sharing figures were off considerably -- instead of the $156.4 paid into the two funds, the actual figure was $543.4 million.

Regarding off-reservation gaming, the report includes information on pending land-into-trust applications that was sourced to the California Tribal Business Alliance, a small group of tribes that signed new compacts with the state. "So far no California tribes have been authorized to conduct gaming on after-acquired lands by the Secretary of the Interior, although a number are in the process of seeking local and state support for their efforts to do so," the California Research Bureau said.

The reported noted that two tribes that are part of the CTBA -- the Paskenta Band of Nomlaki Indians and the United Auburn Indian Community -- opened casinos land acquired after the passage of IGRA under special acts of Congress.

A third issue in the report centers on regulation of Class II and Class III games. Under the Indian Gaming Regulatory Act, the state has no control over Class II games. Class III games are covered by tribal-state compacts.

Lockyer sought to place more limits on the types of Class II games tribes can operate in a lawsuit that was appealed to the U.S. Supreme Court. The justices refused to consider the case but the state has continued to lobby Congress and the federal government on proposals that seek to clarify the difference between Class II and Class III.

"The National Indian Gaming Commission has authorized tribes without compacts with state governments to have an unlimited number of bingo slot machines," the report states. "Since these devices are 'virtually indistinguishable from video slots' with current technology, bingo halls increasingly look like casinos, hence 'bingosinos,'" it continues, citing the writing of a gaming law professor.

Get the Report:
Gambling in the Golden State: 1998 Forward | Attorney General Lockyer Announces Release of Report Providing Detailed Overview of California Gambling’s Scope and Impact

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