BILL ANALYSIS                                                                                                                                                                                                    �



                                                               AB 277
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       ASSEMBLY THIRD READING
       AB 277 (Hall)
       As Amended  March 21, 2013
       Majority vote 

        SUMMARY  :  Ratifies tribal-state gaming compacts entered into between  
       the State of California and the North Fork Rancheria Band of Mono  
       Indians of California, executed on August 31, 2012, and the State of  
       California and the Wiyot Tribe, executed on March 20, 2013.   
       Specifically:  this bill  :

       1)Ratifies a tribal-state gaming compact between the State of  
         California and the North Fork Rancheria Band of Mono Indians of  
         California, authorizing the Tribe to commence Class III gaming with  
         up to 2,000 gaming devices, executed on August 31, 2012.

       2)Ratifies a tribal-state compact between the State of California and  
         the Wiyot Tribe, executed on March 20, 2013.  The Tribe has agreed  
         to forgo opening a gambling casino on its lands, which are adjacent  
         to the Humboldt Bay National Wildlife Refuge.  In exchange, the  
         Tribe will receive up to 3.5% of the gaming revenue from the North  
         Fork Tribe's gaming facility in Madera County. 

        EXISTING LAW  :

       1)Provides, under the federal Indian Gaming Regulatory Act (IGRA), for  
         the negotiation and conclusion of compacts between federally  
         recognized Indian tribes and the state for the purpose of conducting  
         Class III gaming activities on Indian lands within a state as a  
         means of promoting tribal economic development, self-sufficiency,  
         and strong tribal governments.  Existing law expressly authorizes a  
         number of tribal-state gaming compacts between the State of  
         California and specified Indian tribes. 

       2)Authorizes the conduct of Class III gaming activities to the extent  
         such activities are permitted by state law, a gaming compact has  
         been concluded by a federally recognized tribe and the state, and  
         the compact has been approved by the Secretary of the Interior.  

       3)Limits, under IGRA, the operation of Class III gaming activities to  
         Indian lands acquired on or before October 17, 1988.  Existing law  
         also provides for certain exceptions to conduct gaming activities on  
         Indian lands acquired after October 17, 1988.









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       4)Defines, under IGRA, Indian lands to mean all lands within the  
         limits of any Indian reservation, and any lands title to which is  
         either held in trust by the United States for the benefit of any  
         Indian tribe or individual or held by any Indian tribe or individual  
         subject to restriction by the United States against alienation and  
         over which an Indian tribe exercises governmental power.

       5)Requires, under IGRA, the state to negotiate to conclude a compact  
         in good faith with an Indian tribe having jurisdiction over the  
         Indian lands upon which the Class III gaming activity is to be  
         conducted.  Existing law also provides the United States district  
         courts with jurisdiction over any cause of action initiated by a  
         tribal government alleging that the state failed to negotiate in  
         good faith to conclude a compact.  Furthermore, existing law  
         prescribes the remedy, mediation supervised by the courts, if it is  
         found that the state failed to negotiate in good faith to conclude a  
         compact.  

       6)Authorizes the Governor, under the California Constitution, to  
         negotiate and conclude compacts, subject to ratification by the  
         Legislature.  In total, the State of California has signed and  
         ratified Tribal-State Gaming Compacts with 70 Tribes.  There are  
         currently 59 casinos operated by 58 Tribes.

        FISCAL EFFECT  :  Unknown

        COMMENTS  :   On April 24, 2013, the Assembly Governmental Organization  
       Committee held an informational hearing on both of these tribal-state  
       compacts between the State of California and the above-mentioned  
       Tribes.   
                                           
               NORTH FORK RANCHERIA BAND OF MONO INDIANS OF CALIFORNIA
        
        Background on North Fork Tribe  :  On August 31, 2012, the North Fork  
       Rancheria of Mono Indians of California, a federally recognized Indian  
       tribe listed in the Federal Register as the North Fork Rancheria of  
       Mono Indians of California (Tribe), and the State of California  
       (State) entered into a tribal-state compact pursuant to IGRA.

       The Tribe consists of approximately 1,900 tribal citizens with  
       government offices in Madera County, California.  The Tribe states,  
       since the restoration of its federally recognized status in 1983, the  
       Tribe has established modern tribal governing institutions to improve  








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       the lives of its tribal citizens, many of whom have limited access to  
       basic housing, healthcare, business, employment, and educational  
       services and opportunities.

       According to the Tribe, in 1916 the federal government acquired 80  
       acres of land on a hillside outside the town of North Fork for the  
       Tribe "for the use of the North Fork band of landless Indians." This  
       land-known as the North Fork Rancheria-was lost to the Tribe as a  
       reservation when its federal status was terminated in 1966 under the  
       California Rancheria Act.  While the North Fork Rancheria's status as  
       Indian country was restored in 1987, the land is no longer available  
       to the Tribe because it is held in trust for individual Indians (who  
       do not want to relocate) and not collectively for the Tribe. These  
       unique historical circumstances had left the Tribe, until now, without  
       a land base from which to improve its tribal economy and community. 
        
       The Tribe further states, the land is located in an environmentally  
       sensitive area near the gateway to Yosemite National Park and adjacent  
       to a National Scenic Byway, a national forest, and several state  
       wilderness areas. For these and other reasons, the Tribe and local  
       officials agreed that the Tribe should find an alternative site within  
       Madera County on which to develop a gaming facility.

       According to the Tribe, in 2004, the Tribe requested that the  
       Secretary of the Interior take the proposed gaming facility site in  
       trust for the Tribe for gaming purposes.  Because the land would be  
       taken into trust after 1988, the Secretary would first need to  
       determine if the proposed site would qualify for gaming under any of  
       the exceptions found in Section 20 of IGRA.  These Section 20  
       exceptions were intended to level the playing field for tribes such as  
       North Fork without a viable land base because of past federal policies  
       and provide them with the same opportunity as other tribes. 
        
       According to the Tribe, starting in October 2004, the Bureau of Indian  
       Affairs began preparing an environmental impact statement (EIS) - the  
       most rigorous level of review under the National Environmental Policy  
       Act (NEPA) - for the project in connection with the proposed trust  
       acquisition.  The draft EIS was published and circulated for comment  
       in February 2008.  The final EIS was published in August 2010, and the  
       Record of Decision was issued in December 2012.

       The Tribe states that they adhered precisely to the spirit and letter  
       of the rigorous and lengthy federal review process and, after  
       considerable consultation, analysis, and review, the Secretary of the  








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       Interior approved the requested actions.

        Assistant Secretary Echo Hawk Issues Four Decisions on Tribal Gaming  
       Applications  :  On September 2, 2011, U.S. Department of the Interior  
       (DOI) issued a Press Release saying that Assistant Secretary of the  
       Interior for Indian Affairs Larry Echo Hawk issued decisions on four  
       tribal gaming applications in California and New Mexico, determining  
       that two of the proposed gaming sites meet the legal and regulatory  
       requirements and two do not.

       Assistant Secretary Echo Hawk determined that a proposed gaming  
       facility in Madera County, would be in the best interest of the North  
       Fork Rancheria of Mono Indians, and would not be detrimental to the  
       surrounding community. 

       The press release further stated, "Our responsibility under IGRA is  
       clear: we must review each application on a case by case basis and  
       determine whether it meets the standards outlined in law and  
       regulation," said Echo Hawk. "Following a careful and thorough review  
       of the applications from the Enterprise Rancheria and the North Fork  
       Rancheria tribes, I have determined that both tribes' applications  
       meet the strong standards under the law. Both tribes have historical  
       connections to the proposed gaming sites, and both proposals have  
       strong support from the local community, which are important factors  
       in our review."

       The Assistant Secretary also issued two negative decisions on other  
       tribal gaming applications:  one for the Guidiville Band of Pomo  
       Indians in California, and the other for the Pueblo of Jemez in New  
       Mexico.

       Section 20(b)(1)(A) of IGRA (25 United States Code (U.S.C.) Section  
       2719(b)(1)(A)) contains a provision (commonly known as the "Two-Part  
       Determination) allowing a tribe to operate a gaming establishment on  
       lands that are acquired in trust for the benefit of a tribe after  
       IGRA's effective date if, after consultation with the tribe and  
       appropriate state and local officials, including officials of other  
       nearby tribes, the Secretary of the Department of the Interior  
       (Secretary) determines that a gaming establishment would be in the  
       best interests of the tribe and its members and not detrimental to the  
       surrounding community, and the governor of the state concurs in that  
       determination.

       The press release further stated, that under IGRA, the Governor of the  








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       State of California had one year to concur in the Assistant  
       Secretary's determination on the North Fork Rancheria, before the  
       parcel of land can be acquired in trust for the Tribe to conduct  
       gaming.  If the Governor does not concur in the Assistant Secretary's  
       determination for each tribe, respectively, then the Tribe may not  
       conduct gaming on the proposed site.

        Governor Brown Concurs with U.S. Department of the Interior Decision  :   
       On August 31, 2012, Governor Edmund G. Brown Jr. concurred with the  
       Department of the Interior's decisions to allow 305 acres in Madera  
       County to be placed in trust for the North Fork Rancheria Band of Mono  
       Indians for the purpose of establishing a Class III gaming facility.   
       The Governor's letter to Secretary Kenneth L. Salazar concurring with  
       the U.S. Department of Interior's decision stated: 

       "I concur with your determination to allow 305 acres in Madera County  
       to be placed in trust for the North Fork Rancheria Band of Mono  
       Indians for the purpose of establishing a Class III gaming facility.   
       While I am reluctant to allow the expansion of gaming on land  
       currently ineligible for it, I concur in your determination in this  
       case because of several exceptional circumstances:

        The federal administrative process giving rise to your determination  
       was extremely thorough.  The process lasted more than seven years,  
       included numerous hearings, considered hundreds of comments, and  
       generated thousands of pages of administrative records.

        A large tribal population will directly benefit from the gaming  
       facility.  The North Fork Mono's Compact guarantees that revenues from  
       the gaming facility will be shared directly with the Wiyot Tribe,  
       which has agreed to forgo gaming on its own lands - including  
       environmentally sensitive areas. The two tribes are comprised of  
       approximately 2,500 native Californians.

        Other tribes will indirectly benefit from the gaming facility.  The  
       North Fork Mono's Compact provides assistance to other tribes by  
       requiring substantial contributions to the Revenue Sharing Trust Fund  
       and the Tribal Nation Grant Fund.

        The ability of other tribes to benefit from gaming will not be  
       unduly harmed.  The North Fork Mono's Compact specifically provides  
       mitigation for the only tribe likely to be affected by the gaming  
       facility, the Picayune Rancheria of the Chukchansi.









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        The gaming facility is supported by both Madera County and the City  
       of Madera, and the regional gaming market can support the project  
       along with existing gaming facilities.

        The location of the gaming facility will not be within a major  
       metropolitan area.

        The North Fork Mono has a significant historical connection with the  
       land."

       The letter concluded with, "I expect there will be few requests from  
       other tribes that will present the same kind of exceptional  
       circumstances to support a similar expansion of tribal gaming land."

        Governor Brown Signs Compact with Tribe  :  On the same day that the  
       Governor concurred with DOI, he released the details of a tribal-state  
       gaming compact between the State of California and the Tribe.  The  
       Compact allows for up to a total of 2,000 gaming devices.

       The Tribe estimates that the project will create more than 1,400  
       permanent jobs and 1,200 construction jobs and generate an additional  
       2,000 local community spin-off jobs across diverse economic levels and  
       industry sectors.

       The Compact requires the Tribe to pay a percentage of its Annual Net  
       Win from gaming devices for:  1) non-gaming tribes; 2) local  
       mitigation; 3) State regulatory costs; 4) the Wiyot Tribe to  
       compensate that tribe for agreeing not to build a gaming facility on  
       its reservation near the Humboldt County coast pursuant to a separate  
       compact with the State; and 5) the Picayune Rancheria of Chukchansi  
       Indians to mitigate potential economic impacts on that Tribe. 

       The Compact includes provisions to protect employees and patrons as  
       well as measures to protect the environment during the construction  
       and operation of gaming facilities.  It also funds programs in local  
       communities to mitigate the effect of gaming activities and address  
       gambling addiction.  The Compact also requires regular audits of  
       gaming operations and other enforcement and public safety measures.

       Should the gaming facility's financial performance far exceed  
       reasonable projections, the Tribe, in furtherance of the Tribe's and  
       the State's goal to ensure that all California tribes benefit from  
       tribal gaming, has agreed to make additional payments to the State  
       (RSTF and TNGF) for revenue sharing with non-gaming tribes and  








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       limited-gaming tribes.

       The Compact's preamble states, this Compact will afford the Tribe  
       primary responsibility over the regulation of its gaming facility and  
       will enhance tribal economic development and self-sufficiency.  The  
       State and the Tribe have therefore concluded that this Compact  
       protects the interests of the Tribe and its members, the surrounding  
       community, and the California public, and will promote and secure  
       long-term stability, mutual respect, and mutual benefits.  

       The Tribe expects the proposed project to serve as an economic  
       catalyst for a region with an unemployment rate consistently higher  
       than the state average and an agriculture based economy in need of  
       diversification.

       Upon all the necessary approvals, the Compact shall be in full force  
       and effect for state law purposes until December 31, 2033.

        Final Land to Trust Decision  :  On November 26, 2012, the Assistant  
       Secretary of  Indian Affairs  made a final agency determination to  
       acquire approximately 305.49 acres of land in trust for gaming  
       purposes for the Tribe under the authority of the Indian  
       Reorganization Act of 1934, 25 U.S.C. 465. 

       Notice of the determination was published in the Federal Register on  
       December 3, 2012.  The Picayune Rancheria of Chukchansi Indians and  
       Stand Up for California then each sued the Secretary of the Interior  
       challenging the final agency action in District of Colombia District  
       Court.  The cases were consolidated and plaintiffs filed a motion  
       requesting a preliminary injunction to stop the trust transfer.  On  
       January 31, 2013, after briefing and a hearing, the court denied  
       plaintiffs request in a 53-page opinion, finding that plaintiffs had  
       not met their burden to show a likelihood of success on the merits or  
       that they would be harmed by the trust transfer.  The Department of  
       the Interior then provided plaintiffs four days to file a notice of  
       appeal; otherwise, they indicated that the land would be taken into  
       trust.  When plaintiffs did not appeal the decision, the land was  
       taken into trust on February 5, 2013.

        According to the Compact's Preamble  :  As per the Compact's preamble,  
       the lands that constitute the North Fork Rancheria are adjacent to the  
       Sierra National Forest, are a 40-minute drive from the southern  
       entrance to Yosemite National Park, and are located in the Sierra  
       foothills in Madera County.  The Tribe and the State do not believe  








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       that a gaming facility should be located in such an environmentally  
       sensitive and scenic area, which includes the presence of threatened  
       species and species of concern.  

       Additionally, to avoid undue impacts of gaming facilities on an area  
       adjacent to the Humboldt Bay National Wildlife Refuge and the area  
       within and surrounding the North Fork Rancheria, and to promote tribal  
       economic development, tribal self-sufficiency, and strong tribal  
       government, the Tribe requested the Secretary to take into trust for  
       the benefit of the Tribe a separate parcel of land located in an  
       unincorporated area of Madera County and to determine that the land,  
       once in trust, is eligible for gaming pursuant to Section 20 of IGRA.

       The Governor's office reports, the Bureau of Indian Affairs has  
       prepared an environmental impact statement with respect to the  
       construction and operation of the proposed gaming facility on the land  
       pursuant to the National Environmental Policy Act (NEPA).

       The Governor's office reports that the Board of Supervisors of Madera  
       County and the affected local community have expressed support for the  
       Tribe's proposed casino to be located on the designated parcel of  
       land.  In August 2004, the Tribe entered into an enforceable and  
       binding agreement with Madera County to address impacts of the Tribe's  
       gaming facility as a precondition to developing its gaming facility.   
       In October 2006, the Tribe entered into an enforceable and binding  
       agreement with the City of Madera to address impacts of the Tribe's  
       gaming facility on the City.  In December 2006, the Tribe entered into  
       an enforceable and binding agreement with the Madera Irrigation  
       District to address impacts of the Tribe's casino on groundwater.

       The Compact's preamble states, in light of the Tribe's willingness to  
       locate its casino on the 305-acre parcel instead of an environmentally  
       sensitive area, to make revenue sharing payments to the Wiyot Tribe to  
       facilitate that tribe's sovereign agreement with the State to forgo  
       gaming on environmentally sensitive land, to make revenue sharing  
       payments to the Chukchansi Indian Tribe to mitigate potential  
       competitive impacts on that tribe, and to mitigate project impacts on  
       the local community and environment, and in light of Madera County's  
       support for the proposed gaming facility and the other covenants of  
       this Compact, the Governor will concur in the favorable determination  
       by the Secretary that the gaming facility would be in the best  
       interests of the Tribe and its citizens and not detrimental to the  
       surrounding community.









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       The Governor's office further reports that the parties believe that  
       the Tribe's revenue contribution to the State is fair in light of the  
       need for the Tribe to retain sufficient revenues in the initial years  
       of its gaming activities to promote strong tribal government and  
       self-sufficiency, provide services for its approximately 1,900 Tribal  
       Citizens, assist the Wiyot Tribe's approximately 600 members, and  
       assist the Chukchansi Tribe, and significantly reduce the debt  
       incurred in the pre-development phase of its casino as a result of the  
       Tribe's efforts to address local concerns.

       Revenue Provisions of the Compact Include:
        
         Special Distribution Fund  :  The Tribe shall pay to the State on a pro  
       rata basis the actual and reasonable costs the State incurs for the  
       performance of all its duties under this Compact, as established by  
       the monies appropriated in the annual Budget Act for the performance  
       of their duties under the Class III Gaming Compacts each fiscal year  
       for the California Gambling Control Commission (CGCC), the California  
       Department of Justice, the Office of the Governor and the California  
       Department of Alcohol and Drug Programs, Office of Problem Gambling,  
       or any agency or agencies the State designates as a successor to them.  
        The Tribe's pro rata share of the State's costs in any given year  
       this Compact is in effect shall be calculated, as defined.
        
       Percentage Payment of Net Win to Revenue Sharing Trust Fund  :   
       Subject to the deductions specified below, the Compact requires the  
       Tribe to pay the following percentages to the State Gaming Agency  
       for deposit to the Revenue Sharing Trust Fund (RSTF), until fully  
       funded, and then to the Tribal Nations Grant Fund (TNGF), if created  
       by the Legislature, for the benefit of non-gaming tribes and  
       limited-gaming tribes:

       1)10% of the Net Win on slots in the first year of operations. 

       2)11% in Year Two. 

       3)12% in Year Three. 

       4)13 % in Year Four. 

       5)14% in Year Five. 

       6)15% in Year Six through the expiration of the Compact at the end of  
         2033.








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       The foregoing payments have been negotiated between the parties as a  
       fair contribution, based upon the Tribe's market conditions, its  
       circumstances, and the rights afforded under this Compact.

       According to the Tribe, it is projected that the North Fork Rancheria  
       project will contribute between $250 million and $300 million to the  
       RSTF or TNGF for nongaming tribes during the life of the Compact.
        
       Payment Terms  :  The Compact requires the Tribe to make various  
       payments for the purposes described above.  However, the Tribe may  
       "deduct such payments" described below from the RSTF and TNGF  
       payments, effectively capping the Tribe's total payment obligation  
       under the Compact to 10-15% of Net Win.
        
         Payments to the Wiyot Tribe  :  The Compact requires the Tribe to pay to  
       the State Gaming Agency for deposit into the Wiyot Tribe Trust Fund a  
       percentage of Net Win according to the following schedule in exchange  
       for the Wiyot Tribe's agreement not to game on their lands along  
       Humboldt Bay in Northern California: 
       
       
        ------------------------------------------------------------------------ 
       |                              |Percentage of Net Win of Gaming Devices  |
       |Annual Net Win of Gaming      |Paid                                     |
       |Devices                       |to the State Gaming Agency               |
       |------------------------------+-----------------------------------------|
                                                                              |$0-$100 million               |2.5%                                     |
       |------------------------------+-----------------------------------------|
       |$100 million to $200 million  |3%                                       |
       |------------------------------+-----------------------------------------|
       |Over $200 million             |3.5%                                     |
        ------------------------------------------------------------------------ 

       According to the Wiyot Tribe, this revenue sharing arrangement will  
       generate between $3-5 million a year, nearly four times as much as the  
       Tribe currently receives in gaming allotments under the RSTF.

       In addition, to the payments referenced above, if the Net Win from all  
       gaming devices in operation in the gaming facility for the year  
       exceeds an amount as set forth in the Compact, the Tribe shall pay an  
       amount to the State Gaming Agency, for deposit into the RSTF or the  
       TNGF for distribution to non-gaming Tribes and limited-gaming Tribes,  
       25% of the difference between the Net Win and the corresponding amount  








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       for that year.  If this provision is triggered, it would effectively  
       increase the revenue percentage payment paid by the Tribe into the  
       RSTF or the TNGF.

       If the State's Compact with the Wiyot Tribe is terminated,  
       invalidated, expires, or does not go into effect by its terms, the  
       Tribe's obligations shall terminate.
        
       Mitigation to Chukchansi Indian Tribe  :  To mitigate the potential  
       economic impact of the Tribe's proposed gaming facility on the  
       Chukchansi Indian Tribe's gaming facility, the Tribe agrees to refrain  
       from operating or permitting the operation of a hotel on the 305-Acre  
       Parcel until on or after July 1, 2018.

       In addition, commencing upon the date the Tribe secures and closes  
       financing from third-party lenders to fund the construction and  
       initial operation of the gaming facility, the Tribe shall be obligated  
       to pay to the State Gaming Agency an amount equal to the quarterly  
       payments made by the Chukchansi Indian Tribe to the RSTF, as defined  
       in the Tribal-State Gaming Compact between the Chukchansi Indians and  
       the State of California, dated September 10, 1999, but in any event,  
       not to exceed $768,750 per quarter or $3.075 million annually, as  
       defined.

       Upon the commencement of gaming activities pursuant to this Compact,  
       but in no event later than January 1, 2016, the Tribe's and the State  
       Gaming Agency's obligations shall terminate, and thereafter the Tribe  
       shall pay to the State Gaming Agency for deposit into the SDF a  
       percentage of the Tribe's Net Win for all gaming devices operated in  
       the gaming facility according to the following schedule: 

        ------------------------------------------------------------------------ 
       |                              |Percentage of Net Win of Gaming Devices  |
       |Annual Net Win of Gaming      |Paid                                     |
       |Devices                       |to the State's Gaming Agency             |
       |------------------------------+-----------------------------------------|
       |$0-$100 million               |2.5%                                     |
       |------------------------------+-----------------------------------------|
       |Over $100 to $200 million     |3%                                       |
       |------------------------------+-----------------------------------------|
       |Over $200 million             |3.5%                                     |
       |                              |                                         |
        ------------------------------------------------------------------------ 









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       The Tribe's and the State Gaming Agency's obligations under this  
       provision shall terminate on June 30, 2020.


       The State shall terminate the Tribe's and the State's obligations as  
       provided if the Chukchansi Indian Tribe pursues in any way, or  
       finances, in whole or in part, directly or indirectly, any lobbying,  
       administrative, legal, judicial or other challenge to the Secretary's  
       decision to accept the 305-Acre Parcel in trust for the Tribe, the  
       California Legislature's ratification of this Compact, or the  
       Secretary's approval of this Compact. 

        Payments for Project Mitigation  :  The Compact allows the Tribe to  
       deduct the following mitigation payments to be paid under existing and  
       certain future agreements, including: 


       1)$4.035 million a year to the County of Madera (County) under the  
         2004 Memorandum of Understanding (MOU) (includes $100,000 a year to  
         City of Chowchilla), as defined.


       2)$825,000 to the City of Madera (City) under the 2006 MOU, as  
         defined.


       3)$47,500 to the Madera Irrigation District (Irrigation District)  
         under the 2006 MOU, as specified.


       4)Payments for highway improvements under a future agreement with the  
         California Department of Transportation (Caltrans), as defined.


       The payments to the County, City, and Irrigation District listed above  
       are annual (i.e., recurring) payments (adjusted annually by the  
       Consumer Price Index (CPI)).  The Caltrans agreement will be a  
       one-time (i.e., non-recurring) payment to improve the Avenue 17  
       interchange.


        Other Mitigation  :  Beginning in Year Six, payments of up to 2% of Net  
       Win for mitigation not otherwise provided for in any intergovernmental  
       agreement for services including:  law enforcement, fire services,  








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       emergency medical services, environmental impacts, water supplies,  
       waste disposal, behavioral health, planning and adjacent land uses,  
       public health, roads, recreation and youth programs, and child care  
       programs.

        Payments for State Regulatory Costs  :  The Compact requires the Tribe  
       to pay the actual and reasonable costs the State incurs for the  
       performance of all its duties under the Compact for deposit into the  
       SDF. 


        Other Key Provisions of the Compact  : 

        Authorized Class III Gaming  :  In addition to any Class II games, the  
       Tribe is authorized to operate gaming devices (slot machines), banking  
       or percentage card games, and any devices or games that are authorized  
       under state law to the California State Lottery.  The Tribe may not  
       operate roulette games (table or mechanical) or any game that  
       incorporates the physical use of a die or dice.  The Tribe shall not  
       engage in Class III Gaming that is not expressly authorized in the  
       Compact.

        Authorized Facilities and Number of Gaming Devices  :  The Tribe is  
       entitled to operate up to a total of 2,000 gaming devices, as defined  
       in the Compact.  However, that in the event the State authorizes  
       another federally recognized Indian tribe to operate in excess of  
       2,000 gaming devices at any location within a 60-mile radius of the  
       305-Acre Parcel, the Tribe shall be entitled to operate up to the same  
       number of gaming devices as such other federally recognized Indian  
       tribe is authorized to operate.  The Tribe may engage in Class III  
       Gaming only on eligible Indian lands held in trust for the Tribe, at a  
       single gaming facility located within the boundaries of the 305-Acre  
       Parcel.  The Tribe agrees not to engage in any gaming activities  
       anywhere else in California.

        Exclusivity  :  Provides for the exclusive right to conduct Class III  
       Gaming.  If exclusivity is abridged anywhere in the state and gaming  
       devices are allowed to be operated legally at non-tribal facilities,  
       the Tribe may either terminate the Compact and stop conducting gaming  
       activities, or reduce its contributions to the SDF, RSTF, and TNGF  
       pending negotiations with the state for a new agreement.  Nothing in  
       the Compact is intended to preclude the California State Lottery from  
       offering any lottery games or devices that are currently or may  
       hereafter be authorized by state law.








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        Gaming Facility Mitigation  :  Before the commencement of any activity  
       occurring on Indian lands, the Tribe shall follow designated  
       procedures, and enter into specific agreements, required pursuant to  
       the Compact, to mitigate significant effects on the off-reservation  
       environment that any tribal environmental impact report described in  
       the Compact identifies may occur as a result of the gaming facility. 

       In addition, the Tribe shall enter into agreements with the City, the  
       County, the Irrigation District, and Caltrans for such undertakings  
       and services that mitigate the impacts of the gaming facility and  
       thereby benefit the gaming facility, the Tribe, the City, the County,  
       the Irrigation District, other affected jurisdictions, and Caltrans  
       upon terms satisfactory to the Governor.

        Local Intergovernmental Agreements Completed :  The Tribe has entered  
       into three separate enforceable MOU agreements with Madera County  
       (2004), the City of Madera (2006), and the Madera Irrigation District  
       (2006).  The Madera County MOU also contains provisions directly  
       relating to and benefiting the City of Chowchilla.  These three  
       comprehensive agreements require that the Tribe pay nearly $100  
       million in contributions over 20 years to fund local public safety,  
       infrastructure, education, housing, job training, economic  
       development, and local charities as well as to mitigate possible  
       significant impacts of the project.  In addition, the Tribe has agreed  
       to establish several new foundations to invest in local charitable  
       causes, education, economic development, and unincorporated areas.

        Patron Protections  :  The Tribe agrees to binding arbitration before a  
       single arbitrator, who shall be a retired judge, for disputes over  
       patron injuries and gambling, as specified. 

        Environmental Protections  :  The Tribe is required to prepare a Tribal  
       Environmental Impact Report (TEIR) prior to initiating a development  
       project for a facility, to measure off-reservation environmental  
       impacts including an evaluation of energy consumption.  A completed  
       TEIR shall be filed with the County, the City, the Department of  
       Justice, Office of the Attorney General, and the State Clearinghouse.   
       In the event that no agreement on mitigation is reached, either party  
       may demand binding arbitration.  Failure to prepare an adequate TEIR  
       when required shall be deemed a breach of the Compact and furthermore  
       shall be grounds for issuance of an injunction or other appropriate  
       equitable relief.









                                                               AB 277
                                                               Page  15


        Labor Provisions  :  If the Tribe employs 250 or more persons in a  
       tribal casino facility, then the provisions of the Tribal Labor  
       Relations Ordinance (TLRO) become effective.  The TLRO provides for a  
       secret ballot election.  The Tribe has entered into separate  
       agreements with the Fresno, Madera, Kings, and Tulare Counties  
       Building and Construction Trades Council (2005) and UNITE HERE  
       International Union (2006).
        
       Employee Protections  :  The Tribe has granted employees the right to  
       collectively bargain.  The Tribe has agreed to participate in the  
       State's worker's compensation system and unemployment insurance  
       program, to comply with federal and state occupational health and  
       safety standards, and to consent to the jurisdiction of the state  
       agencies and courts enforcing all of those standards.  The Tribe also  
       has agreed to enhanced employment discrimination provisions.

        Public and Workplace Liability  :  The Tribe has agreed to adopt and  
       comply with standards no less stringent than federal and state  
       employment discrimination laws.  Any discrimination claims may be  
       resolved pursuant to binding arbitration before a retired judge.  The  
       Tribe has agreed to maintain employment practices insurance of no less  
       than $3 million per occurrence.  Personal injury and property damage  
       claims arising from the casino operation may be resolved pursuant to  
       binding arbitration before a retired judge.  The Tribe has agreed to  
       maintain commercial general liability insurance of no less than $10  
       million per occurrence for bodily injury, property damage, and  
       personal injury.  The Tribe has agreed to participate in the State's  
       workers' compensation and unemployment compensation programs with  
       respect to employees employed at the Tribe's casino.  The Tribe has  
       also agreed to comply with all earnings withholding orders for spousal  
       and child support.

        Building and Safety Standards  :  The casino must adopt and comply with  
       federal and State workplace and occupational health and safety  
       standards.

        Enhanced Audit and Compliance Review Procedures  :  In addition to  
       providing for an annual independent audit, the Compact allows the  
       State to conduct its own annual audit and Compact compliance review.

        Inspection of Slot Machines  :  The Compact requires that the software  
       used for the play on a gaming device to be tested, approved and  
       certified by an independent or state governmental gaming test  
       laboratory.  Slot machines are required to be tested by a gaming test  








                                                               AB 277
                                                               Page  16


       laboratory and the Tribal Gaming Agency (TGA).  The CGCC shall inspect  
       all gaming devices in operation at the casino, including all the  
       software, hardware, and associated equipment and systems that support  
       the operation of the gaming devices, on a random basis four times  
       annually to confirm that they operate and play properly.  The CGCC  
       shall review the Tribe's technical standards, regulations and internal  
       controls applicable to slot machines.

        Minimum Internal Control Standards (MICS)  :  The Compact requires the  
       Tribe to adopt and comply with minimum internal control standards  
       (MICS) that meet or exceed the standards of the federal National  
       Indian Gaming Commission.  The MICS are incorporated into the Compact  
       as an appendix, which shall be updated periodically to stay abreast of  
       changing technology and industry standards.  Furthermore, it requires  
       the Tribe to contract with an independent certified public accountant  
       (CPA) at least annually, at the Tribe's expense, to verify compliance  
       with the Tribe's written internal control standards.

        Problem Gambling  :  The Tribe must train supervisors and floor  
       employees on identifying and managing problem gambling, include a  
       responsible gaming message in advertising, provide signage and  
       education materials at conspicuous locations aimed at preventing  
       problem gambling, and adopt a code of conduct derived from the  
       American Gaming Association's code. 

        Tobacco  :  The Tribe agrees to provide a non-smoking area in the gaming  
       facility and to utilize a ventilation system throughout the gaming  
       facility that exhausts tobacco smoke to the extent reasonably feasible  
       under state-of-the-art technology existing as of the date of the  
       construction or significant renovation of the gaming facility, and  
       further agrees not to offer or sell tobacco to anyone under 18 years  
       of age.

        Prohibitions Regarding Minors  :  The Tribe shall prohibit persons under  
       the age of 21 years from being present in any room or area in which  
       gaming activities are being conducted unless the person is en route to  
       a nongaming area of the gaming facility, or is employed at the gaming  
       facility in a capacity other than as a gaming employee.
        
       Alcohol Sales  :  Makes it explicit that the purchase, sale, and service  
       of alcoholic beverages shall be subject to state law (Alcoholic  
       Beverage Control Act). 

        Tribal Ownership, Management, and Control of Gaming Operation  :  The  








                                                               AB 277
                                                               Page  17


       gaming operation authorized under this Compact shall be owned solely  
       by the Tribe.

        Effective Date  :  The Compact is not effective until it is ratified in  
       accordance with State law, and notice of approval by the U.S.  
       Secretary of the Interior is published in the Federal Register.  Upon  
       all the necessary approvals, the Compact will be valid until December  
       31, 2033.
                                           
                                     WIYOT TRIBE
        
        Summary  :  This bill would ratify an unique tribal-state gaming compact  
       between the State of California (State) and the Wiyot Tribe (Tribe),  
       executed on March 20, 2013.  

       The Wiyot Tribe, formerly known as the Table Bluff Reservation - Wiyot  
       Tribe, California, is a federally recognized Indian tribe, comprised  
       of nearly 640 members.  The Tribe has agreed to forgo opening a  
       gambling casino on its 88-acre reservation, which is adjacent to the  
       Humboldt Bay National Wildlife Refuge.  The reservation is 16 miles  
       (26 km) south of Eureka between Loleta and the South Jetty of Humboldt  
       Bay in Humboldt County.  

       According to the Governor's office, the Wiyot people have lived in the  
       Humboldt Bay region for thousands of years.  The North Coast of  
       California is rich with abundant terrestrial, riverine, estuarine, and  
       marine resources.  The United States Fish and Wildlife Service manages  
       the Humboldt Bay National Wildlife Refuge Salmon Creek Unit east of  
       the Reservation and the Eel River Estuary to the south.  These  
       protected areas exist primarily to protect and enhance wetland  
       habitats for hundreds of thousands of migratory water fowl that rely  
       on the Pacific Flyway.

       The Governor's office states, the Wiyot Tribe and the State had  
       extensive negotiations concerning the Tribe's desire to conduct Class  
       III gaming on its existing lands in Humboldt County.  The State has  
       concerns related to the potential environmental implications of a  
       tribal gaming facility on the Tribe's lands, including concerns  
       related to water quality, a casino adjacent to the Humboldt Bay  
       National Wildlife Refuge, the potentially negative aesthetic impact of  
       a casino on Humboldt Bay, and the potential depletion of the aquifer  
       supplying the Humboldt County area.

       In exchange for not building a casino, the Tribe will receive up to  








                                                               AB 277
                                                               Page  18


       3.5% of the gaming revenue from a proposed gaming facility operated by  
       the North Fork Rancheria of Mono Indians of California in Madera  
       County.  According to the Wiyot Tribe, this revenue sharing  
       arrangement will generate between $3-5 million a year, nearly four  
       times as much as the Tribe currently receives in gaming allotments  
       under the Indian Gaming Revenue Sharing Trust Fund (IGRSTF or RSTF).

       The Wiyot Tribe states, this "Tribal-State Gaming Compact will provide  
       our tribal members with resources to educate and care for our people  
       and protect our environmentally sensitive lands."
        
       The Wiyot Tribe and Compact  :  The Compact's preamble declares, the  
       Tribe has historically been a strong and active steward of its lands,  
       wishes to continue to protect those lands, and is willing to agree not  
       to engage in or authorize gaming activities on those lands if it can  
       promote tribal economic development and self-sufficiency in another  
       way.

       The Compact's preamble further declares, to promote good relations  
       between tribal, state, and local governments, enhance tribal economic  
       development and self-sufficiency, protect the environment and the  
       interests of the Tribe and the California public, and promote the  
       purposes of the Indian Gaming Regulatory Act of 1988 (IGRA), the State  
       and the Tribe have concluded this Compact, which provides for a fair  
       payment to the Tribe in exchange for the Tribe's agreement to forgo  
       gaming activities on its lands for the duration of this Compact.

       The Wiyot Tribe has committed to using a portion of these funds to  
       continue their environmental work on Humboldt Bay and the Eel River,  
       including their ongoing water quality monitoring, Brownfields cleanup,  
       environmental education and outreach, and habitat restoration.   
       Furthermore, in joining with the North Fork Rancheria, ratification of  
       the Wiyot Tribe Compact will help protect an area of the Sierra  
       foothills near the Sierra National Forest and Yosemite National Park.

       The Wiyot Compact requires that the Tribe use at least 50% of the  
       revenues derived from the Compact to fund tribal government operations  
       and programs, general tribal welfare programs, economic development  
       and charitable donations.   The Tribe cannot distribute any more than  
       50% of these monies directly to tribal members so that the funds  
       benefit the tribe as a whole in accordance with our tribal mission.

       According to the Tribe, their annual budget is approximately $1  
       million, most of which comes from the RSTF for non-gaming tribes.   








                                                               AB 277
                                                               Page  19


       Half of that annual allocation goes to tribal members for their  
       support.  The rest goes toward tribal operations.  The Tribe has 14  
       employees on the reservation, four of whom are tribal members.   As of  
       2004, the unemployment rate for tribal members was 29%.  Nearly 37% of  
       the Tribal members lived in poverty-much higher than the statewide  
       average at that time.

       The Tribe states, "the revenues will receive from the North Fork  
       Compact will allow us to provide education, health care and economic  
       development for our tribal members, help us revitalize and teach our  
       native language, as well as allow us to continue the environmental  
       protection and improving the ancestral lands that we so cherish." 

       On a side note, in 2008, after nine years of negotiation, the Tribe  
       signed a tribal Compact with Governor Arnold Schwarzenegger.  In the  
       Compact, the Tribe also waived their right to Class III gaming on its  
       reservation in exchange for a share of the gaming revenues derived  
       from the casino of the North Fork Rancheria of the Mono Indians.  The  
       North Fork Tribe also had signed a 2008 Compact with the Governor.   
       Both Compacts were never submitted to the Legislature for ratification  
       because both Tribes had agreed to wait until the Secretary of the  
       Interior approved the placement of the Madera County casino site into  
       trust.  On February 5, 2013, the United States Department of the  
       Interior placed the North Fork's land in trust for gaming purposes.

        Relinquishment of Right to Game  :
        
       Tribe's Agreement to Forgo Gaming Activities  :  The Wiyot Tribe has  
       agreed not to engage in, authorize, or permit gaming activities on its  
       Indian lands in California during the term of this Compact in exchange  
       for the payments provided to the Tribe.

        Conditions on Agreement to Forgo Gaming Activities  :  In the event that  
       North Fork fails to receive final federal and State approval necessary  
       to make the land specified in the North Fork Compact eligible for  
       Class III gaming by July 1, 2014, the Tribe may, at its sole option,  
       terminate this Compact and request the State to negotiate a gaming  
       Compact; provided that nothing in this Compact shall compel the State  
       to agree to such request or shall be deemed to waive or in any way  
       affect any right of the State to challenge the Wiyot Tribe's assertion  
       that it possesses lands eligible for Class III gaming or that it is  
       otherwise entitled to game on its lands.  

        Revenue Provisions of the Wiyot Compact  :








                                                               AB 277
                                                               Page  20


        
         Payment Schedule  :  In consideration of the Wiyot Tribe's agreement to  
       forgo gaming activities on its Indian lands for the duration of this  
                                                            Compact, the State negotiated the following payments from North Fork  
       for the benefit of the Wiyot Tribe in connection with the North Fork  
       Compact.  The payments are based on the following percentages of Net  
       Win of the gaming devices operated pursuant to the 2012 North Fork  
       Compact:
       
        ----------------------------------------------------------------------- 
       |Annual Net Win of North Fork's   |Percentage of Annual Net Win of      |
       |Gaming Devices Pursuant to North |Gaming Devices to be Paid to the     |
       |Fork Compact                     |Wiyot Tribe                          |
       |---------------------------------+-------------------------------------|
       |$0-$100 million                  |2.5%                                 |
       |---------------------------------+-------------------------------------|
       |Over $100 to $200 million        |3%                                   |
       |---------------------------------+-------------------------------------|
       |Over $200 million                |3.5%                                 |
       |                                 |                                     |
        ----------------------------------------------------------------------- 
       
       These payments shall be calculated, as specified, in the North Fork  
       Compact, which provides that the payments for the benefit of the Wiyot  
       Tribe shall be made quarterly to the State Gaming Agency, and that the  
       specific percentage applied to the quarterly Net Win shall be  
       determined by the cumulative total of the Net Win earned since the  
       beginning of the calendar year.  
        
       Payments to the Wiyot Tribe from the State  :  The State Gaming Agency  
       shall serve as trustee of the RSTF for the benefit of the Wiyot Tribe  
       but shall have no duties or obligations except as set forth in the  
       Compact.  The State Gaming Agency shall receive, deposit, and  
       distribute monies received from North Fork for the sole benefit of the  
       Wiyot Tribe pursuant to the State's disbursement process and the  
       schedule specified in the Compact. 

       In the event the Tribe terminates the Compact, as described, or the  
       State terminates the Compact, the Tribe will lose the right to receive  
       the payments, as specified, in the Compact.  

        Confidentiality of Documents  :  The Tribe will exercise the utmost care  
       in the preservation of the confidentiality of any and all information  
       and documents received from the State Gaming Agency relating to the  








                                                               AB 277
                                                               Page  21


       North Fork Compact, as defined.

        Revenue Sharing Trust Fund Payments (RSTF)  :  Neither the existence of  
       the Compact nor any of its provisions shall affect the Tribe's  
       eligibility to receive distributions from the RSTF and the Tribal  
       Nation Grant Fund (TNGF), as described.

        Use of Disbursements :  The parties to the Compact make no  
       representations as to the applicability of 25 U.S.C. Section  
       2710(b)(2)(B) to the revenues to be received by the Tribe as a result  
       of this Compact.  Nonetheless, in order to achieve IGRA's goals, the  
       Wiyot Tribe shall use the revenues received pursuant this Compact in  
       accordance with federal law, but may not use more than 50% of those  
       revenues in any year to make per capita payments to its tribal  
       members.

       The Wiyot Tribe shall not use any revenues received pursuant to this  
       Compact to create or construct any facility for the purpose of  
       engaging in Class II gaming (as defined in IGRA) or gaming activities  
       during the term of this Compact unless and until the Compact is  
       terminated, as described.  The Tribe shall deposit all revenues  
       received from the Compact in a separate bank account or accounts, as  
       specified.
        
       Claims Relating to the Trust Funds  :  The State and the Wiyot Tribe  
       agree that the State Gaming Agency shall have no duty whatsoever to  
       institute or defend any legal proceedings or any action at law or in  
       equity that relates to the Wiyot Tribe Trust Fund, the RSTF, or the  
       TNGF.  The State Gaming Agency shall give written notice to the State  
       and the Tribe as soon as is practicable upon learning of or being  
       served with process for any such proceedings or action by an entity or  
       person.

        Dispute Resolution Provisions  :  In recognition of the  
       government-to-government relationship of the Tribe and the State, the  
       parties shall make their best efforts to resolve disputes that arise  
       under this Compact by good faith negotiations whenever possible.   
       Therefore, except for the right of either party to seek injunctive  
       relief against the other when circumstances are deemed to require  
       immediate relief, the Tribe and the State shall seek to resolve  
       disputes by first meeting and conferring in good faith in order to  
       foster a spirit of cooperation and efficiency in the administration  
       and monitoring of the performance and compliance of the terms,  
       provisions, and conditions of this Compact as described.








                                                               AB 277
                                                               Page  22


        
       Term of Compact  :  Once effective, this Compact shall be in full force  
       and effect for state and federal law purposes until December 31, 2033.  


        Effective Date  :  The Compact is not effective until it is ratified in  
       accordance with state law, and notice of approval by the U.S.  
       Secretary of the Interior is published in the Federal Register.  Upon  
       all the necessary approvals, the Compact will be valid. 

        Termination by the Tribe  :  The Compact authorizes the Wiyot Tribe to  
       terminate this Compact; the termination may only be effectuated by  
       means of written notice served on the Governor of the State, as  
       specified.

        Termination by the State  :  In the event of any material change in the  
       State's ability to comply with the terms of this Compact, the State  
       may terminate this Compact upon 90 days' written notice to the Tribe.   
       State budget constraints, in and of themselves, shall not be deemed a  
       material change in the State's ability to comply with the terms of  
       this Compact.

        Amendment by Agreement  :  The terms and conditions of this Compact may  
       be amended at any time by the mutual and written agreement of both  
       parties during the term of this Compact, as described.

        In Support  :  The State Building and Construction Trades of California  
       states, this bill will create thousands of quality jobs construction  
       jobs for the members of the building trades.  The project associated  
       with this compact will create over 5,000 jobs in one of the most  
       underserved and economically disadvantaged regions of the country.   
       Madera County currently has a 13.4% unemployment rate.  However, the  
       overall unemployment rate in the construction industry is above 25%  
       with some crafts reporting higher rates.  The project will generate  
       hundreds of millions in local economic benefits in wages, local  
       business contracts, public infrastructure and other local public  
       funding.  The North Fork Rancheria project is a shining light of hope  
       for thousands of working families.

       Supporters note that the North Fork Tribe project will generate much  
       needed employment and additional business opportunities as well as  
       generating tourism to Madera and the San Joaquin Valley.  

       Proponent's state, the North Fork Tribe has worked diligently through  








                                                               AB 277
                                                               Page  23


       a very long, arduous and thorough multi-governmental process to get to  
       this point.  

       According to California Labor Federation and UNITE HERE, the North  
       Fork Tribe has agreed to respect the rights of tribal gaming employees  
       to seek union representation.  We applaud their willingness to join  
       other California gaming tribes who support enforceable worker rights.

       Proponents further state, this Compact will also provide much needed  
       income to the economically disadvantaged Wiyot Tribe.  The Tribe has  
       committed to using a portion of the funds to continue their  
       environmental work on Humboldt Bay and Eel River, including their  
       ongoing water quality monitoring, Brownfields cleanup, environmental  
       education and outreach, and habitat restoration.  Furthermore, in  
       joining with the North Fork Tribe, ratification of these compacts will  
       help protect an area of the Sierra foothills near the Sierra National  
       Forest and Yosemite National Park.

        In Opposition  :  Opponents in opposition state, that each and every  
       tribe that undertook the campaign to pass Propositions 5 (1998) and 1A  
       (2000) has a moral obligation to stand by the explicit commitment that  
       was made to the voters that Indian gaming would be limited to Indian  
       lands.  The decision to authorize Class III gaming on a limited basis  
       to tribal lands was not a light judgment, and the fundamental tenets  
       for that statewide approval must be honored.  The fact of the matter  
       is that the North Fork Tribe currently has land in trust that is  
       eligible for gaming.  The Tribe can conduct gaming on land they  
       already hold in trust.  That the land is not as commercially  
       advantageous as land closer to population centers is a circumstance  
       neither unique to this tribe nor a good reason to abandon the State's  
       longstanding and effective policy of limited gaming in California, as  
       expressed by the voters in numerous initiative measures and referenda.

       In addition, Table Mountain Rancheria opposes any tribal gaming  
       compact that encourages, requires, or requests a federally recognized  
       Indian Tribe to waive its sovereign right to engage in gaming on their  
       Rancheria or reservation.

       Opponents further state, there are significant legal issues regarding  
       this Compact, and many social concerns exist as well.  This project  
       will also divest the State and the County of jurisdiction over land  
       because placing land is trust takes land out of regulatory control of  
       the state and local government.  This means less property tax, sales  
       tax, possessory tax revenue.  In addition, the Governor's  








                                                               AB 277
                                                               Page  24


       responsibility is to faithfully uphold and enforce the law.  This bill  
       presents a compact that is inconsistent with the separation of powers,  
       current state gaming policy approved by the statewide electorate,  
       state statute and California Constitutional law.

                           ADDITIONAL BACKGROUND INFORMATION  

        California Proposition 1A, Gambling on Tribal Lands  :  California  
       Proposition 1A, also known as the Gambling on Tribal Lands Amendment,  
       was on the March 7, 2000, ballot in California, where it was approved  
       (64.5%-35.5%).   Proposition 1A authorized the governor to negotiate  
       compacts with federally recognized Indian tribes on Indian lands in  
       California to operate slot machines, lotteries and banking and  
       percentage card games, subject to legislative ratification.   
       Proposition 1A was a legislatively-referred constitutional amendment,  
       placed on the ballot by the California State Legislature as a proposed  
       modification of the Section 19 of Article IV of the California  
       Constitution.
        
       Indian Gaming Regulatory Act  :  In 1988, Congress enacted the IGRA to  
       provide a statutory basis for the operation and regulation of gaming  
       on Indian lands.  IGRA provides that an Indian tribe may conduct  
       gaming activity on Indian lands if the activity "is not specifically  
       prohibited by federal law and is conducted within a State which does  
       not prohibit such gaming activity."

       The statute divides gaming activities into three classes (Class I,  
       Class II, and Class III), each subject to different regulations.   
       Class III Gaming includes such things as slot machines, casino games  
       and banked card games such as black jack and baccarat.  Class III  
       Gaming may only be conducted under terms of a compact negotiated  
       between an Indian tribe and a State.  Class II Gaming is defined to  
       include bingo and card games that are explicitly authorized by the  
       laws of the state, or that are not explicitly prohibited by the laws  
       of the state and are played at any location in the State, so long as  
       the card games are played in conformity with those laws and  
       regulations.

       IGRA was enacted against a legal background in which Indian tribes and  
       individuals generally are exempt from state taxation within their own  
       territory.  IGRA provides that with the exception of assessments  
       permitted under the statute, to defray the State's costs of regulating  
       gaming activity, IGRA shall not be interpreted as conferring upon a  
       State authority to impose any tax, fee, charge, or other assessment  








                                                               AB 277
                                                               Page  25


       upon an Indian tribe to engage in Class III activity.  Nor may a State  
       refuse to enter into negotiations based on the lack of authority to  
       impose such a tax, fee, charge, or other assessment.

       When a tribe requests negotiations for a Class III compact, IGRA  
       requires the State to negotiate with the Indian tribe in good faith.   
       IGRA provides a comprehensive process to prevent an impasse in compact  
       negotiations, which is triggered when a tribe files suit alleging that  
       the State has refused to negotiate or has failed to negotiate in good  
       faith.

        Compact Negotiation and Ratification  :  The State Constitution, as  
       amended by Proposition 1A of March 2000, permits Indian tribes to  
       conduct and operate slot machines, lottery games, and banked and  
       percentage card games on Indian land.  These gambling activities can  
       only occur if:  1) the Governor and an Indian tribe reach agreement on  
       a compact; 2) the Legislature approves the compact; and 3) the federal  
       government approves the compact. 

       The Governor is the designated state officer responsible for  
       negotiating and executing, on behalf of the state, tribal-state gaming  
       compacts with federally recognized Indian tribes located within the  
       State of California.  Following completion of negotiations, the  
       Governor shall submit a copy of any executed tribal-state compact to  
       both houses of the Legislature for ratification and shall submit a  
       copy of the executed compact to the Secretary of State and it then  
       must be approved and published in the Federal Register by the U.S.  
       Secretary of the Interior.  
        
       Rincon Decision  :  This Compact takes into consideration a recent  
       decision of the United States Ninth Circuit Court of Appeals in Rincon  
       Band of Luiseno Mission Indians of the Rincon Reservation v.  
       Schwarzenegger (9th Cir. 2010) 602 F. 3d 1019, which states in  
       essence, that the State is precluded from negotiating with tribal  
       governments for payments into the General Fund.  In July 2011, the  
       U.S. Supreme Court declined to review the Ninth Circuit Court's  
       decision.  

       In 2004, the Rincon Band of Mission Indians sued the State of  
       California in federal court after negotiations for a new gambling  
       agreement with then-Governor Schwarzenegger fell apart.  The Tribe  
       believed the Governor was violating federal law by insisting that  
       Tribes pay money into the state's general fund in exchange for more  
       slot machines.








                                                               AB 277
                                                               Page  26



       The Rincon decision has changed the dynamics of tribal-state compact  
       negotiations in the State of California.  
        
       Prior Legislation  :  AB 517 (Hall), Chapter 12, Statutes of 2012,   
       ratified the tribal-state gaming compact entered into between the  
       State and the Federated Indians of Graton Rancheria of Sonoma County,  
       executed on March 27, 2012.  

       AB 787 (Chesbro), Chapter 340, Statutes of 2012, ratified the  
       amendment to the tribal-state gaming compact entered into between the  
       State and the Coyote Valley Band of Pomo Indians, executed on July 25,  
       2012.

       AB 1418 (Hall), Chapter 412, Statutes of 2011, ratified a revised  
       tribal-state gaming compact between the State and Pinoleville Pomo  
       Nation, authorizing the Tribe to commence Class III Gaming with up to  
       900 gaming devices, executed on August 8, 2011.  Required  
       contributions to the SDF and the RSTF, as specified, instead of  
       requiring revenue contributions to the General Fund.

       AB 1020 (Chesbro), Chapter 27, Statutes of 2011, ratified a revised  
       compact between the State and the Habematolel Pomo of Upper Lake  
       executed on March 17, 2011.  Authorized the Tribe to operate up to 750  
       gaming devices with up to 15% of the Net Win from those gaming devices  
       be paid to the SDF and RSTF, instead of requiring revenue  
       contributions to the General Fund.

       AB 122 (Coto), Chapter 3, Statutes of 2010, ratified the tribal-state  
       gaming compact entered into between the State and the Pinoleville Pomo  
       Nation executed by the Governor on March 10, 2009.

       AB 3072 (Price), Chapter 334, Statutes of 2008, ratified the first  
       amendment to a tribal-state gaming compact entered into between the  
       State and the Shingle Springs Band of Miwok Indians, executed on June  
       30, 2008.    

       SB 106 (Wiggins), Chapter 37, Statutes of 2007, ratified a new compact  
       between the State and the Yurok Tribe of the Yurok Reservation.  

       SB 174 (Ducheny), Chapter 39, Statutes of 2007, ratified the first  
       compact amendment to the compact between the State and Sycuan Band of  
       the Kumeyaay Nation.









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       SB 175 (Ducheny), Chapter 38, Statutes of 2007, ratified the first  
       compact amendment to the compact between the State and the Morongo  
       Band of Mission Indians.

       SB 903 (Padilla), Chapter 40, Statutes of 2007, ratified the first  
       compact amendment to the compact between the State and the Pechanga  
       Band of Luise�o Indians.

       SB 941 (Padilla), Chapter 226, Statutes of 2007, ratified the first  
       compact amendment to the compact between the State and the San Manuel  
       Band of Serrano Mission Indians.

       SB 957 (Torlakson), Chapter 41, Statutes of 2007, ratified the first  
       compact amendment to the compact between the State and the Agua  
       Caliente Band of Cahuilla Indians.

       SB 470 (Ducheny), Chapter 527, Statutes of 2006, ratified the first  
       amendment to the compact between the State and the Quechan Tribe of  
       the Fort Yuma Reservation. 

       SB 1117 (Burton), Chapter 856, Statutes of 2004, ratified two new and  
       two amended compacts entered into between the State and the following  
       tribes:  Coyote Valley Band of Pomo Indians (new compact); Fort Mojave  
       Indian Tribe (new compact); Buena Vista Rancheria of Me-Wuk Indians  
       (amended compact); and, Ewiiaapaayp Band of Kumeyaay Indians (amended  
       compact).

       AB 687 (Nu�ez), Chapter 91, Statutes of 2004, ratified amendments to  
       five compacts entered into between the State and the following tribes:  
        Pala Band of Mission Indians; Pauma Band of Luiseno Mission Indians  
       of the Pauma and Yuima Reservation; Rumsey Band of Wintun Indians;  
       United Auburn Indian Communities; and, Viejas Group of Kumeyaay  
       Indians.  Provides for the issuance of bonds in an amount not to  
       exceed $1.5 billion by the California Infrastructure and Economic  
       Development Bank and requires the net proceeds of the sale of the  
       compact assets to be deposited in the Traffic Congestion Relief Fund  
       and the Transportation Deferred Investment Fund.

       SB 930 (Burton) Chapter 802, Statutes of 2003, ratified a compact  
       between the State and the Torres-Martinez Desert Cahuilla Indians.

       SB 411 (Ducheny), Chapter 790, Statutes of 2003, ratified compacts  
       between the State and the La Posta Band of Diegueno Mission Indians  
       and the Santa Ysabel Band of Diegueno Mission Indians in San Diego  








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       County.

       AB 1385 (Battin), Chapter 874, Statutes of 1999, designated the  
       Governor as the state officer responsible for negotiating and  
       executing compacts between the State and federally recognized Indian  
       tribes located in the state.  Ratifies 57 compacts and creates two  
       special funds in the State Treasury (SDF and RSTF) for the deposit of  
       revenues derived from Indian gaming and gaming device licensing fees.   
        

       SB 287 (Burton), Chapter 409, Statutes of 1998, ratified 11 compacts  
       negotiated between the State of California and Indian tribes that  
       permitted Class III Gaming devices on tribal lands and established a  
       process for ratifying other compacts.
        

       Analysis Prepared by  :    Eric Johnson / G. O. / (916) 319-2531 


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