BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 668|
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THIRD READING
Bill No: SB 668
Author: Fuller (R), et al.
Amended: 4/1/13
Vote: 21
NOTE: On April 23, 2013, the Senate Governmental Organization
Committee held an informational hearing on the
tribal-state compact between the State of California and
the Fort Independence Indian Community of Paiute Indians.
SUBJECT : Tribal gaming: compact ratification
SOURCE : Author
DIGEST : This bill ratifies the tribal-state gaming compact
(Compact) entered into between the State of California and the
Fort Independence Indian Community of Paiute Indians, executed
on February 28, 2013; provides that, in deference to tribal
sovereignty, certain actions are not deemed projects for
purposes of the California Environmental Quality Act (CEQA); and
stipulates, except as expressly provided, that none of the
provisions shall be construed to exempt a city, county, or city
and county, or the Department of Transportation from CEQA
requirements.
ANALYSIS :
Existing law:
1. Provides, under the Indian Gaming Regulatory Act (IGRA), for
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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.
2. Expressly authorizes a number of tribal-state gaming
compacts between the State of California and specified Indian
tribes.
3. 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.
4. Limits the operation of Class III gaming activities to
Indian lands acquired on or before October 17, 1988.
Provides for certain exceptions to conduct gaming activities
on Indian lands acquired after October 17, 1988.
5. Defines 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 U.S. against
alienation and over which an Indian tribe exercises
governmental power.
6. Requires 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. Provides the U.S. 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. 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.
7. Authorizes the Governor, under the California Constitution,
to negotiate and conclude compacts, subject to ratification
by the Legislature.
This bill ratifies the Compact between the State of California
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and the Fort Independence Indian Community of Paiute Indians
(Tribe) executed on
February 28, 2013, and allows the operation of up to 800 gaming
devices (slot machines) and any banking or percentage card
games. The Compact makes it explicit that the Tribe shall not
be authorized to operate the game known as roulette, whether or
not played with or on a mechanical, electro-mechanical,
electrical, or video device, or cards, or any combination of
such devices, or the operation of any game that incorporates the
physical use of a die or dice. The Tribe will share up to 10%
of their revenue with tribes that are not gaming or that are
otherwise not substantially benefitting from gaming. The
Compact requires regular audits of gaming operations and other
enforcement and public safety measures. 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 local programs to mitigate
the effect of gaming activities and addresses gambling addiction
issues. Additionally, the land for the Compact is and has been
in trust for the tribe since 1915. Once effective (legislative
ratification and federal approval required), this Compact will
be in full force and effect for state law purposes until
December 31, 2034.
Background
As per the Compact's preamble, the Fort Independence Community
of Paiute Indians is a federally recognized Indian tribe listed
in the Federal Register as the Fort Independence Indian
Community of Paiute Indians of the Fort Independence
Reservation, California. The Tribe has originally and
continuously inhabited the Owens Valley and Eastern California
since time immemorial and the Tribe's current reservation was
established on October 28, 1915, by President Woodrow Wilson's
Executive Order, number 2264, creating a permanent home for the
Tribe on 360 acres of land adjacent to Oak Creek in
Independence, California. The Tribe is committed to improving
the environment, education status, and the health, safety and
general welfare of its members and local residents.
Additionally, the State and the Tribe recognize that the
exclusive rights that the Tribe will enjoy under this Compact
create a unique opportunity for the Tribe to operate a Class III
gaming facility in an economic environment free of competition
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from the operation of slot machines and banked card games on
non-Indian lands in California and that this unique economic
environment is of great value to the Tribe.
In consideration of the exclusive rights enjoyed by the Tribe to
engage in the gaming activities and to operate up to 800 slot
machines and the other meaningful concessions offered by the
State in good faith negotiations, and pursuant to IGRA, the
Tribe has agreed to provide the State, on a
sovereign-to-sovereign basis, and to local jurisdictions, fair
cost reimbursement and mitigation from revenues derived from the
slot machines operated pursuant to this Compact on a specified
payment schedule.
This Compact will afford the Tribe primary responsibility over
the regulation of its gaming facility and will enhance the
Tribe's economic development and self-sufficiency. Furthermore,
the State and the Tribe have 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.
Key Provisions of the Compact
Requires the Tribe, prior to the commencement of a
"project," as defined, to follow certain procedures and enter
into specified agreements (e.g., environmental and
intergovernmental) for such undertakings and services that
mitigate the impacts of the gaming facility on affected
jurisdictions.
Stipulates that the gaming operation or business operation
authorized under this Compact shall be owned solely by the
Tribe and limits the Tribe to the operation of 800 slot
machines on eligible Indian lands held in trust for the Tribe
at a single gaming facility located within the boundaries of
the Fort Independence Indian Reservation.
Provides that the Tribe is not required to make payments to
the State Gaming Agency for deposit into the Revenue Sharing
Trust Fund (RSTF) or the Tribal Nation Grant Fund, if it
operates 350 or fewer slot machines.
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If the Tribe operates more than 350 slot machines at any
time in a given calendar year it must pay 10% of its net win
to the State Gaming Agency for deposit into RSTF or the
Tribal Nation Grant Fund. The Compact outlines quarterly
payment terms, as specified.
Requires the Tribe to pay into the Special Distribution
Fund, on a pro rata basis, the actual and reasonable
regulatory costs the State incurs for the performance of all
its duties under this Compact - the Tribe estimates that this
will equal $465.00 per device for regulatory fees. The
Tribe's pro rata share will be calculated using the following
equation: "The maximum number of gaming devices operated in
the gaming facility for the previous fiscal year as
determined by the State Gaming Agency, divided by the maximum
number of gaming devices operated by all federally recognized
tribes in California pursuant to tribal-state Class-III
gaming compacts during the previous fiscal year, multiplied
by costs, equals the Tribe's pro rata share."
Additional Provisions of the Compact
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. Also, provides
that the Tribe agrees to waive sovereign immunity in order to
be compelled in federal or state court to abide by the
resolution of arbitration.
Environmental protections . The Tribe must prepare a Tribal
Environmental Impact Report (TEIR) and negotiate mitigation
of any off-reservation impacts. The Tribe's failure to
prepare an adequate TEIR when required shall be deemed a
breach of this Compact and furthermore shall be grounds for
issuance of an injunction or other appropriate equitable
relief. Also, provides for binding arbitration if an
intergovernmental agreement with the County of Inyo or the
Town of Independence is not entered into within 75 days of
the submission of the final TEIR.
Employee protections . The Tribe has agreed to participate
in the State's workers' compensation system and unemployment
insurance program and to consent to the jurisdiction of the
state agencies and courts enforcing all of those standards.
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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 and testing of slot machines . Slot machines will
have to be tested, approved and certified by an independent
gaming test laboratory and the tribal gaming agency to ensure
that they are being operated according to specified technical
standards. Authorizes the State Gaming Agency to annually
conduct up to four random inspections of slot machines in
operation to confirm that the slot machines are operating in
conformance with these standards.
Minimum Internal Control Standards (MICS) . The Tribe must
adopt and comply with standards that meet or exceed the
federal National Indian Gaming Commission standards. The
MICS are incorporated in this Compact as an appendix
(Appendix D), which shall be updated periodically by the
State Gaming Agency and Tribal Gaming Agency, to ensure the
MICS keep up with changing technology and industry standards.
Problem gambling . The Tribal Gaming Agency must establish a
program to mitigate pathological and problem gaming by
implementing measures that train supervisors and floor
employees on identifying and managing problem gambling.
Additionally, the Tribe must include a responsible gaming
message in advertising, provide signage and education
materials at conspicuous locations aimed at preventing
problem gambling, establish self-exclusion and involuntary
exclusion programs, and adopt a code of conduct derived from
the American Gaming Association's code.
Labor relations . Provides that the gaming activities
authorized by this Compact may only commence after the Tribe
has adopted an ordinance identical to the Tribal Labor
Relations Ordinance (TRLO), referenced as Appendix C of the
Compact, and the gaming activities may only continue as long
as the Tribe maintains the ordinance. If the Tribe employs
250 or more persons in a tribal casino facility, then the
provisions of the TLRO become effective. The TLRO provides
for a secret ballot election.
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Tobacco and alcohol provisions . The Tribe agrees to provide
a non-smoking area in the gaming facility that exists as of
the effective date of this Compact and to utilize a
ventilation system throughout the gaming facility that
exhausts tobacco smoke to the extent reasonably feasible and
not to offer or sell tobacco to anyone that is under 18 years
of age. Makes it explicit that the purchase, sale, and
service of alcoholic beverages shall be subject to state law.
(The Alcoholic Beverage Control Act)
Prohibitions regarding minors . Requires the Tribe to
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.
Exclusivity . In the event the exclusive right of Indian
tribes to operate Class III gaming in California pursuant to
Article IV, Section 19(f) of the California Constitution is
lost and other non-Indian entities legally are able to engage
in Class III gaming the Tribe shall have the right to
terminate this Compact, in which case the Tribe will lose the
right to operate gaming devices and other Class III gaming
authorized by this Compact; or continue under this Compact.
Effective date . This Compact shall not be effective unless
and until it is ratified by the Legislature and notice of
approval or constructive approval is published in the Federal
Register as provided by IGRA. Once effective, this Compact
shall be in full force and effect for state law purposes
until
December 31, 2034. If this Compact does not take effect by
July 1, 2015, it shall be deemed null and void.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 4/25/13)
California Labor Federation
Fort Independence Indian Community of Paiute Indians
Santa Ynez Band of Chumash Indians
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United Auburn Indian Community of the Auburn Rancheria
UNITE-HERE, AFL-CIO
ARGUMENTS IN SUPPORT : The United Auburn Indian Community of
the Auburn Rancheria writes that "this compact approves gaming
on land that the tribe has had in trust for almost 100 years.
Ft. Independence plans to play by the rules and stay on its
reservation land and within its ancestral territory."
The California Labor Federation and UNITE-HERE, AFL-CIO state,
"The Fort Independence Tribe has agreed to respect the rights of
the tribal gaming employees to seek union representation. We
applaud their willingness to join the other California gaming
tribes who support enforceable worker rights."
MW:k 4/25/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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