BILL ANALYSIS �
SB 668
Page 1
SENATE THIRD READING
SB 668 (Fuller)
As Amended April 1, 2013
Majority vote
SENATE VOTE :37-0
SUMMARY : Ratifies a 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. 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.
Specifically, this bill ratifies :
The tribal-state gaming compact between the State of California
(State) and the Fort Independence Indian Community of Paiute
Indians (Tribe), located in Inyo County, California, which was
executed on February 28, 2013, and allows the operation of up to
800 gaming devices and 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, as defined. 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.
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
SB 668
Page 2
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.
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.
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.
SB 668
Page 3
FISCAL EFFECT : Unknown
COMMENTS :
Background : As per the Compact's preamble, the Fort
Independence Community of Paiute Indians (Tribe) 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 (Reservation).
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. The membership consists of 136 tribal members of
which approximately half live on the Reservation.
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 Fort Independence Indian
Reservation as those boundaries exist as of the execution date
of this Compact, as described.
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
from the operation of gaming devices 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 gaming
devices 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
gaming devices operated pursuant to this compact on a specified
payment schedule.
SB 668
Page 4
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 :
1)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 (Town and/or County).
2)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 gaming
devices 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.
3)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.
4)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 gaming devices.
5)If the Tribe operates more than 350 gaming devices at any time
in a given calendar year it must pay 10% of its Net Win from
the operation of those devices in excess of 350 to the State
Gaming Agency for deposit into RSTF or the Tribal Nation Grant
SB 668
Page 5
Fund. The Compact outlines quarterly payment terms, as
specified.
6)Requires the Tribe to pay into the Special Distribution Fund
(SDF), 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'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.
Enhanced Audit and Compliance Review Procedures - In addition to
SB 668
Page 6
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 Gaming Devices - Gaming devices 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. The State Gaming Agency would be authorized to
annually conduct up to four random inspections of slot machines
in operation to confirm that the gaming devices 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.
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
SB 668
Page 7
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.
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.
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.
Also, if this Compact does not take effect by July 1, 2015, it
shall be deemed null and void.
Related legislation : AB 277 (Hall) of the current legislative
session. 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. (Pending on the Senate Floor)
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,
SB 668
Page 8
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.
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
SB 668
Page 9
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 (N��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 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)
SB 668
Page 10
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
FN: 0001301