BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 466


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          (Without Reference to File)





          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          466 (Brown)


          As Amended  August 17, 2016


          Majority vote


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                 (vote not relevant)




          Original Committee Reference:  G.O.


          SUMMARY:  Ratifies the tribal-state gaming compact (Compact)  
          entered into between the State of California and the San Manuel  
          Band of Mission Indians (Tribe) executed on August 16, 2016.   
          Additionally, this bill 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  








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          requirements.


          The Senate amendments delete the Assembly version of this bill,  
          and instead:


          1)Ratify the Compact entered into between the State of  
            California and the San Manuel Band of Mission Indians executed  
            on August 16, 2016.
          2)The Compact supersedes an existing 2006 compact (SB 941  
            (Padilla), Chapter 226, Statutes of 2007) between the Tribe  
            and the State. 


          3)Allows the Tribe to establish and operate not more than two  
            gaming facilities and engage in Class III gaming only on  
            eligible Indian lands held in trust for the Tribe, located  
            within the boundaries of the Tribe's reservation and trust  
            lands as those boundaries exist as of the execution date of  
            the Compact, as defined.


          4)Provides the Tribe may operate a maximum of 7,500 gaming  
            devices (slot machines).  If the Tribe chooses to open a  
            second facility, it may operate no more than 1,000 gaming  
            devices at that second facility.


          5)Terms of the Compact regarding licensing, compliance  
            enforcement, mitigation of off-reservation impacts and  
            protections for patrons and employees are consistent with  
            recent compacts.  Maintains the existing 1999 Tribal Relations  
            Labor Ordinance (TLRO).


          6)Provides for an annual payment of $19 million into the Revenue  
            Sharing Trust Fund (RSTF) or the Tribal Nation Grant Fund  
            (TNGF), to be shared with tribes that are not gaming or that  
            otherwise are not substantially benefiting from gaming.   
            Establishes the San Manuel Community Credit Fund which  
            requires a $29 million annual payment by the Tribe to provide  








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            funding for, or make investments in projects that mutually  
            benefit the Tribe, County, local jurisdictions, and the State,  
            including $3 million for Native American education.  The Tribe  
            will pay into the Special Distribution Fund (SDF) its pro rata  
            share of costs the State incurs for the performance of its  
            duties under the Compact plus additional amounts ($500,000 up  
            to a total of $3 million) to cover a portion of the share of  
            regulatory costs for smaller gaming tribes.  Provisions of  
            this Compact establishing or amending existing revenue sharing  
            obligations of the Tribe, will take effect on July 1, 2017.


          7)Provides that, in deference to tribal sovereignty, certain  
            actions are not deemed projects for purposes of the California  
            Environmental Quality Act (CEQA); and, stipulate, 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.


          8)Provides this Compact will be in full force and effect for 25  
            years following the effective date.


          EXISTING LAW:  


          1) Provides, under the 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. 


          2) Authorizes expressly 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  








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          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  
          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 (U.S.) 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.


          FISCAL EFFECT:  Unknown


          COMMENTS:  On August 23, 2016, the Assembly Governmental  
          Organization Committee held an informational hearing on the  
          tribal gaming Compact entered into between the State of  
          California and the San Manuel Band of Mission Indians.









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          Brief History and Background:  The San Manuel Band of Mission  
          Indians is a federally recognized American Indian tribe located  
          near the city of Highland, California.  San Manuel is one of  
          several clans of Serrano Indians, who are the indigenous people  
          of the San Bernardino highlands, passes, valleys and mountains  
          who share a common language and culture.  The San Manuel  
          reservation was established in 1891 and recognized as a  
          sovereign nation with the right of self-government.  The  
          reservation is named after Santos Manuel, a former tribal  
          leader, and consists of just over 900 acres of mostly  
          mountainous land.  There are more than 200 tribal members  
          enrolled in the Tribe.  


          This will be the third compact between the Tribe and the State.   
          In 1999, the Tribe and the State entered into a compact to  
          enable the Tribe to achieve economic self-reliance, provide  
          essential services to its citizens, and build a strong tribal  
          government; to initiate a new era of tribal-state cooperation in  
          areas of mutual concern.  On August 28, 2006, Governor  
          Schwarzenegger executed amendments to the 1999 gaming compact  
          between the State and the Tribe.  The 2006 compact increased the  
          number of gaming devices the Tribe could operate from 2,000 to  
          7,500.  The compact provided for annual payments of $45 million  
          to the state's General Fund from the Tribe's existing 2,000  
          gaming devices.  It also required an annual payment of 15% of  
          the Net Win for additional gaming devices between 2,000 to 5,000  
          and 25% of the Net Win generated from the operation of gaming  
          devices from 5,000 to 7,500.  The compact required the Tribe to  
          make an annual payment to the RSTF of $2 million annually.   
          There was no change to the Tribe's 1999 Tribal Labor Relations  
          Ordinance that provides for secret ballot elections.  The 2006  
          compact is valid until 2030.

          The San Manuel Indian Bingo & Casino, with more than 400,000  
          square-feet of overall space, includes more than 280,000  
          square-feet of gaming, which includes a Bingo Hall with more  
          than 1,400 seats; nearly 4,000 gaming devices; more than 80  
          Table Games; upwards of 40 Poker Tables; and a High Limit Room.   
          The Tribe states that it dedicates significant resources from  
          gaming to various philanthropic causes through its charitable  








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          donations to others in the community.  Additionally, the Tribe  
          pays millions of dollars to local governments to improve roads,  
          support local municipalities, and fund emergency services.   
          Revenue from the San Manuel Indian Bingo and Casino is used to  
          maintain governmental operations, provide for the general  
          welfare of the Tribe and healthcare needs, supply infrastructure  
          needs such as roads, and to support continued economic  
          development.  The Tribe is one of the largest employers in the  
          Inland Empire area with over 3,000 employees.


          The Tribe states, "that it works diligently to ensure a solid  
          economic foundation for future generations by investing in  
          diverse and strategic economic ventures, both on and off the  
          reservation.  Economic diversification creates ways for the  
          tribe to build a strong economy and contribute to job growth,  
          our surrounding communities, and the long-term self-reliance of  
          our members."  For instance, the Tribe owns a commercial real  
          estate investment project near the reservation that includes a  
          hotel and conference center, restaurants, retail space, and  
          offices.  In 2003, the Tribe collaborated with three other  
          tribes: the Viejas Band of Kumeyaay Indians, the Forest County  
          Potowatomi Community and the Oneida Tribe, both of Wisconsin, to  
          form Four Fires to complete a $43 million hotel project-a  
          13-story, 233-suite Residence Inn by Marriott, near the  
          Smithsonian's National Museum of the American Indian.  Another  
          partnership, Three Fires (the same tribes minus the Forest  
          Potowatomi) built a Residence Inn by Marriott in Sacramento near  
          the state capital and purchased an office building in Washington  
          D.C. and commercial office buildings in other towns.

          According to the Governor's office, this new Compact "affirms  
          the Tribe's commitment to the residents of San Bernardino County  
          and is intended to enable the tribal government to invest in  
          worthy causes, including fire, emergency medical services, law  
          enforcement, public transit, infrastructure improvements,  
          education, renewable energy, recycling or water conservation  
          projects, non-gaming-related economic development and health  
          care facilities. It also will make the tribe one of the largest  
          contributors to the RSTF, which distributes gaming revenue to  
          non-gaming and limited gaming tribes so that the economic  
          benefits of gaming reach all tribal governments within  








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          California."


          The Compact's preamble states, the State and the Tribe have  
          concluded that this Compact protects the interests of the Tribe  
          and its members, the surrounding communities, and the California  
          public, and will promote and secure long-term stability, mutual  
          respect, and mutual benefits


          Key Components of the Compact:  


          Authorized Gaming Facility:  The Tribe may establish and operate  
          not more than two (2) gaming facilities and engage in Class III  
          Gaming only on eligible Indian lands held in trust for the  
          Tribe, located within the boundaries of the Tribe's reservation  
          and trust lands as those boundaries exist as of the execution  
          date of this Compact, as legally described in the Compact.  If  
          the Tribe chooses to open a second facility, it may operate no  
          more than 1,000 gaming devices at that second facility.


          Scope of Class III Gaming Authorized:  Authorizes the Tribe to  
          operate up to a total of 7,500 gaming devices (slot machines);  
          banking or percentage card games; any devices or games that are  
          authorized under state law to the California State Lottery,  
          provided that the Tribe will not offer such games through use of  
          the Internet unless others in the state not affiliated with or  
          licensed by the California State Lottery are permitted to do so  
          under state and federal law; and, off-track wagering on horse  
          races in the gaming facility, as defined.  The Tribe shall not  
          engage in Class III gaming that is not expressly authorized in  
          the Compact.  Nothing shall be construed to preclude the Tribe  
          from offering class II gaming at the Tribe's gaming facility.


          Payments to the Special Distribution Fund (SDF):  The Tribe  
          shall pay to the State, on a pro rata basis, the costs the State  
          incurs for the performance of all its duties under this Compact,  
          the administration and implementation of tribal-state gaming  
          compacts, and funding for the Office of Problem Gambling, as  








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          determined by the monies appropriated in the annual Budget Act  
          each fiscal year to carry out those purposes, as defined.


          The Tribe further agrees to pay an additional five hundred  
          thousand dollars ($500,000) into the SDF to ensure it remains  
          solvent.  In the event the pro rata funding for the SDF  
          statewide has proven sufficient for three consecutive years, the  
          parties agree to meet and confer for the purpose of making an  
          appropriate reduction in the additional payment.  In addition,  
          if the Tribe's pro rata share exceeds $3 million; the Tribe  
          shall pay the greater of its pro rata share or $3 million.


          Payments to the RSTF or the TNGF:  The Tribe agrees to pay $19  
          million annually to the California Gambling Control Commission  
          (CGCC) for deposit into the RSTF or the TNGF for the benefit of  
          non-gaming tribes and limited-gaming tribes. 


          San Manuel Community Credit Fund:  Establishes the San Manuel  
          Community Credit Fund (SMCCF), which is managed by the Tribe to  
          make or provide funding for, or make investments in projects  
          that mutually benefit the Tribe, County, local jurisdictions,  
          and the State.  The Tribe shall make quarterly payments into the  
          fund totaling $29 million per year.  The SMCCF may be used for  
          the following purposes:


          1)Payments by the Tribe to the County or local jurisdictions  
            operating facilities or providing services within the County  
            for fire, law enforcement, emergency medical services, public  
            transit, education, tourism, or other services and  
            infrastructure improvements intended to serve off-reservation  
            needs of County residents as well as those of the Tribe - such  
            payments shall be subject to approval by the County or local  
            jurisdiction receiving the funds; 
          2)Cost of services provided by the Tribe, or payments made to  
            the County, local jurisdictions, school districts, charter  
            schools, or non-profit or civic organizations operating  
            facilities or providing services within the County, for  
            cultural programs, fire services, emergency medical services,  








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            problem gambling programs, law enforcement, public transit,  
            education, tourism, youth athletics and other youth programs,  
            or other services or infrastructure improvements that in part  
            serve off-reservation needs of County residents;


          3)To promote continued economic growth that benefits the Tribe  
            and the surrounding community through investments in  
            facilities, infrastructure, or other projects that generate  
            sustained job creation and ensure the financial longevity of  
            the Tribe, the Tribe may utilize up to 20% of the monies  
            deposited into the San Manuel Community Credit Fund annually  
            for the purpose of making payments to the principal amount on  
            its debt services which are secured by the assets of the  
            gaming operation; 


          4)Investments by the Tribe in, and any funds paid to the State  
            (not including direct or indirect state or federal funding) in  
            water treatment or conservation projects that, in part, serve  
            the Gaming Facility or any improvements incorporating water  
            conservation or treatment technology on real property owned by  
            the Tribe; 


          5)Non-gaming related capital investments and economic  
            development projects by the Tribe, on or off tribal trust  
            lands, that provide mutual benefits to the Tribe and the State  
            or to the Tribe and local political subdivisions because, for  
            instance, they have particular cultural, social, or  
            environmental value, create jobs, or diversify the sources of  
            revenue for the Tribe's general fund; 


          6)Investments in, and any funds paid to the State in connection  
            with, renewable energy projects that, in part, serve the  
            gaming facility, , to include facilities that incorporate  
            charging stations for electric or other zero-emission vehicles  
            that are available to tribal members, patrons, and employees  
            of the gaming facility or the Tribe; 










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          7)Payments (not including direct or indirect state or federal  
            funding) to support capital improvements and operating  
            expenses for facilities or programs within California that  
            provide health care services to tribal members, Indians, and  
            non-Indians; 


          8)Grants to Native Americans who are not members of the Tribe,  
            or grants to other federally-recognized tribes or other Native  
            American tribes regardless of their federal-recognition  
            status, for educational, cultural, or vocational purposes, or  
            for governmental or general welfare purposes or funds or  
            donations provided for the purpose of aiding federally  
            recognized tribes in the wake of natural or man-made  
            disasters; 


          9)Investments, loans, or other financial obligations including  
            actual payments used to secure loans, to or for the benefit of  
            other federally recognized tribes for any purpose, including  
            gaming; 


          10)Costs of recycling programs, and any improvements  
            incorporating recycling technology, that, in part, serve the  
            Gaming Facility, or other on or off-reservation needs within  
            the County; and 


          11)Contributions toward the enhancement of Native American  
            education in the State of California, which shall be in the  
            amount of no less than $3 million in contributions per year.

          All excess authorized SMCCF monies that cannot be applied in any  
          one year under, may be applied as an annual credit in all  
          following years that this Compact is in effect, until completely  
          exhausted.


          Effective Date of Revenue Contribution Provisions:  The  
          provisions of this Compact establishing or amending existing  
          revenue sharing obligations of the Tribe, including payments to  








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          the SDF, the RSTF/TNGF, the SMCCF, and payments and  
          reimbursement to local government to mitigate significant  
          effects on the off-reservation environment will take effect on  
          July 1, 2017.  Until that date, the revenue contributions set  
          forth in the 2006 amended compact will remain in effect.


          Treatment of Credits Paid by the Tribe in an Economic Downturn:   
          In the event the Tribe's annual gross gaming revenue is less  
          than its gross gaming revenue for fiscal year 2009, the Tribe  
          shall no longer be required to pay the credit amounts into the  
          San Manuel Community Credit Fund, as identified.


          Exclusivity:  Provides that in the event the exclusive right of  
          Indian tribes to operate Class III gaming in California pursuant  
          to the California Constitution is lost and other non-Indian  
          entities 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 Class III gaming authorized  
          by this Compact; or continue under this Compact, as defined.


          Off-Reservation Environmental and Economic Impacts:  The Tribe  
          must prepare a Tribal Environmental Impact Report (TEIR) and  
          negotiate mitigation of any off-reservation impacts, including  
          an evaluation of energy consumption, prior to initiating the  
          development of a Project for a facility.  The Compact provides  
          procedures regarding the 1) Notice of Preparation of Draft TEIR,  
          2) Notice of Completion of Draft TEIR, and 3) Issuance of Final  
          TEIR.  The Tribe's failure to prepare an adequate TEIR when  
          required may warrant an injunction where appropriate.  Before  
          commencement of a Project, and no later than the issuance of the  
          final TEIR, the Tribe shall negotiate an intergovernmental  
          agreement with the California Department of transportation  
          (Caltrans) if state roads are impacted.  A completed TEIR must  
          be filed with the County, the Department of Justice, the CGCC,  
          and the State Clearinghouse. 


          Before commencement of a Project, and no later than the issuance  
          of the final TEIR, the Tribe shall offer to commence  








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          negotiations with the County to, amongst other things, provide  
          for the timely mitigation of any significant effect on the  
          off-reservation environment including provisions relating to  
          compensation for law enforcement, fire protection, emergency  
          medical services and any other public services to be provided by  
          the County to the Tribe as a consequence of the Project.


          Cost Reimbursement and Mitigation to Local Governments:  The  
                                                              Tribe shall enter into agreements with local jurisdictions or  
          state agencies, as appropriate, for such undertakings and  
          services that mitigate the impacts of the gaming facility, as  
          defined, and thereby benefit the gaming facility, the Tribe, or  
          other affected jurisdictions.  Copies of all such agreements  
          shall be provided to the State. 


          Additional Compact Components:


          Gaming Ordinance and Regulations:  All gaming activities  
          conducted under this Compact shall, at a minimum, comply with 1)  
          a gaming ordinance duly adopted by the Tribe and approved in  
          accordance with IGRA, 2) all rules, regulations, procedures,  
          specifications, and standards duly adopted by the National  
          Indian Gaming Commission (NIGC), the Tribal Gaming Agency, and  
          the State Gaming Agency, and 3) the provisions of this Compact,  
          as specified. 


          Minimum Internal Control Standards (MICS):  Requires the Tribe  
          to conduct its Gaming Activities pursuant to an internal control  
          system that implements MICS that are no less stringent than  
          specified MICS of the NIGC. It requires gaming to operate  
          pursuant to a written internal control system that reasonably  
          assures that assets are safeguarded and accountability over  
          assets is maintained, liabilities are properly recorded and  
          contingent liabilities are properly disclosed, financial records  
          are accurate and reliable, transactions are performed in  
          accordance with the Tribe's authorization. The Tribe is required  
          to provide to the CGCC, upon written request, a copy of the  
          independent certified public accountant agreed-upon procedures  








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          report conducted annually for submission to the NIGC pursuant to  
          federal law. This report verifies that the gaming operation is  
          in compliance with the NIGC's minimum internal control  
          standards.


          Public and Workplace Liability:  The Tribe is required to obtain  
          and maintain a commercial general liability insurance policy  
          that provides coverage of no less than $10 million. The Tribe  
          must adopt a Tort Liability Ordinance stipulating that  
          California tort law governs claims. The Tribe agrees to  
          participate in the state's workers' compensation program with  
          respect to employees at the casino. All disputes arising from  
          the workers' compensation laws shall be heard by the State  
          Workers' Compensation Appeals Board pursuant to the California  
          Labor Code.


          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 Gaming Devices:  Gaming devices will  
          have to be tested, approved and certified by an independent  
          gaming test laboratory or state governmental gaming test  
          laboratory to ensure they are being operated according to  
          specified technical standards.  The Tribal Gaming Agency is  
          required to maintain adequate records that demonstrate  
          compliance with software and hardware specifications.  The CGCC  
          will be authorized 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.


          Labor Provisions:  The new San Manuel compact maintains the  
          existing 1999 Tribal Labor Relations Ordinance (TLRO).  A  
          collective bargaining agreement currently exists between the  
          Tribe and the Communications Workers of America (CWA).  This  
          agreement governs the organizational and representational rights  
          of employees at the gaming facility.  The Tribe has negotiated  








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          and entered into several renewals of that collective bargaining  
          agreement, including one that was recently renewed and is in  
          full force and effect.  The parties agree that no change in the  
          TLRO is necessary to address employee rights at this time.   
          However, should the collective bargaining agreement not be  
          renewed, the TLRO included in the Compact as Appendix B shall be  
          adopted by the Tribe in place of the existing TLRO.


          Workers' Compensation:  The Tribe agrees that it will  
          participate in the state's unemployment compensation program for  
          providing benefits and unemployment compensation disability  
          benefits to employees at the casino.  The Tribe shall, with  
          respect to persons, including nonresidents of California,  
          employed at the gaming operation or gaming facility, withhold  
          all amounts due to the State as provided in the California  
          Unemployment Insurance Code and, except for tribal members  
          living on the Tribe's reservation, as provided.


          The Tribe agrees to participate in the State's workers'  
          compensation program with respect to employees at the gaming  
          operation and the gaming facility.  All disputes arising from  
          the workers' compensation laws shall be heard by the State  
          Workers' Compensation Appeals Board pursuant to the California  
          Labor Code. The Tribe acknowledges the jurisdiction of the Board  
          in such manners.   In lieu of participation in the State's  
          system, the Tribe may create and maintain a system through  
          self-insurance, which includes specified provisions, including  
          hearings before an independent tribunal.  


          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 non-gaming area of the gaming facility.


          Use and Sale of Tobacco:  The Tribe agrees to provide a  
          non-smoking area in the gaming facility and, consistent with the  
          Tribe's commitment to the well-being of its employees and  
          patrons, to incorporate ventilation, filtration, purification or  








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          other technologies throughout the gaming facility, where  
          reasonable and feasible after consideration of engineering,  
          economic and scientific factors, and further agrees not to offer  
          or sell tobacco to anyone under 21 years of age.


          Alcohol Provisions:  If the Tribe permits the consumption of  
          alcoholic beverages in the gaming facility, the Tribe shall  
          prohibit persons under the age of 21 years from purchasing,  
          consuming, or possessing alcoholic beverages.  The Tribe shall  
          also prohibit persons under the age of 21 years from being  
          present in any room or area in which alcoholic beverages may be  
          consumed, except to the extent permitted by the Department of  
          Alcoholic Beverage Control, as specified.


          Problem Gambling:  The Tribe shall continue to maintain  
          safeguards against problem gambling, as defined 


          Building Codes and Fire Safety:  In order to assure the  
          protection of the health and safety of all gaming facility  
          patrons, guests, and employees, the Tribe shall adopt or has  
          already adopted, and shall maintain throughout the term of this  
          Compact, an ordinance that requires any gaming facility  
          construction to meet or exceed the construction standards set  
          forth in the applicable codes. Gaming facility construction,  
          expansion, improvement, modification or renovation must also  
          comply with the federal Americans with Disabilities Act.   


          Health and Safety Standards:  The Tribe must also adopt and  
          comply with tribal law that is consistent with federal and state  
          laws forbidding harassment, including sexual harassment,  
          discrimination and retaliation.  In addition, the Tribe must  
          maintain an insurance policy for these purposes and adopt an  
          ordinance that includes a dispute resolution process.


          The Tribe has agreed to adopt and comply with tribal health  
          standards for food and beverage handling that are no less  
          stringent than State public health standards.  The Tribe has  








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          also agreed to comply with federal water quality and safe  
          drinking water standards applicable in California.


          Emergency Services Accessibility:  The Tribe shall make  
          reasonable provisions for adequate emergency fire, medical, and  
          related relief and disaster services for patrons and employees  
          of the gaming facility.


          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, provided that each party voluntarily  
          consents to such negotiations in writing.  Any amendments to  
          this Compact shall be deemed to supersede, supplant and  
          extinguish all previous understandings and agreements on the  
          subject.


          Effective Date:  Once effective (legislative ratification and  
          federal approval required), this Compact will be in full force  
          and effect for 25 years following the effective date.


          Additional Background Information:


          Rincon Decision:  In 2004, the Rincon Band of Mission Indians  
          sued the State in federal court after negotiations for a new  
          gambling agreement with then-Governor Schwarzenegger came to a  
          standstill.  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 gaming devices.


          In July 2011, the United States Supreme Court declined to review  
          a Ninth Circuit Court's decision that ruled the state could not  
          require the Rincon Band tribe to pay a percentage of slot  
          machine revenue into California's General Fund for more gaming  
          devices.  The Ninth Circuit had affirmed a lower court decision  
          that the new financial concessions were nothing more than a  
          state tax on tribal casino revenues, which is prohibited by  








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          IGRA.  The court concluded that a "non-negotiable, mandatory  
          payment of 10% of net win into the State treasury for  
          unrestricted use yields public revenue and is [therefore] a tax  
          and that the court was therefore required to consider the  
          State's demand as evidence of bad faith under IGRA's statutes."   
           


          The Rincon decision changed the dynamics of tribal-state compact  
          negotiations in California.  While the compacts requiring these  
          payments stood, any new compacts or amendments of existing  
          compacts may no longer require General Fund contributions.


          SDF:  Existing law creates the SDF in the State Treasury for the  
          receipt of revenue contributions made by tribal governments  
          pursuant to the terms of the 1999 model Tribal-State Gaming  
          compacts and authorizes the Legislature to appropriate money  
          from the SDF for the following purposes:  1) grants for programs  
          designed to address gambling addiction;  2) grants for the  
          support of state and local government agencies impacted by  
          tribal government gaming; 3) compensation for regulatory costs  
          incurred by CGCC and the DOJ in connection with the  
          implementation and administration of compacts; 4) payment of  
          shortfalls that may occur in the Indian Gaming RSTF; 5)  
          disbursements for the purpose of implementing the terms of  
          tribal labor relations ordinances promulgated in accordance with  
          the terms of the 1999 compacts; and, 6) any other purpose  
          specified by law.  The distribution formula "sunsets" on January  
          1, 2021.


          RSTF:  Existing law also creates in the State Treasury the RSTF  
          for the receipt and deposit of moneys derived from gaming device  
          license fees that are paid into the RSTF pursuant to the terms  
          of specified tribal-state gaming compacts for the purpose of  
          making distributions to non-compacted tribes (e.g.,  
          federally-recognized non-gaming and tribes that operate casinos  
          with fewer than 350 slot machines).  Revenue in the RSTF is  
          available to CGCC, upon appropriation by the Legislature, for  
          making distributions of $1.1 million annually to non-compact  
          tribes.  The RSTF was created as part of the 1999 compacts,  








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          which, in conjunction with the passage of Proposition 1A (2000),  
          created gaming compacts with approximately 60 California tribes.  
           Non-compact tribes are considered third-party beneficiaries of  
          the 1999 compacts.


          According to CGCC, which administers the RSTF, a revenue  
          shortfall of approximately $15.5 million is anticipated this  
          fiscal year.  According to the Department of Finance (DOF), the  
          SDF has sufficient funds in it for fiscal year 2016-2017 to  
          cover the RSTF shortfall.  However, DOF indicates that it  
          projects a $1.6 million SDF balance deficiency in fiscal year  
          2017-2018 assuming a $25 million transfer to the RSTF.  To cover  
          the anticipated shortfall in 2017-2018, approximately $1.6  
          million will need to be transferred from the General Fund in  
          order to ensure full RSTF payments are made to non-gaming and  
          limited-gaming tribes.  A similar amount was redirected in  
          2015-2016. Recent compacts, including this one, have attempted  
          to alleviate the shortfall situation by requiring payments by  
          Tribes directly to the RSTF. This model appears to be a template  
          for future compacts, as well.


          TNGF:  The TNGF was created in the Graton Rancheria compact (AB  
          517 (Hall), Chapter 12, Statutes of 2012), as a new destination  
          for gaming revenue for distribution of funds to non-gaming and  
          limited-gaming tribes, upon application of such tribes for  
          purposes related to effective self-governance, self-determined  
          community, and economic development.  The fund is designed to be  
          fluid and payments are intended to be made to non-gaming tribes  
          on a "need" basis, upon application by non-gaming tribes.  The  
          TNGF currently does not receive funding.


          Related legislation:  AB 2358 (Waldron) of the current  
          legislative session.  Would ratify the tribal-state gaming  
          compact entered into between the State and the Pechanga Band of  
          Luiseno Indians, executed August 4, 2016.  


          AB 629 (Gonzalez), of the current legislative session 2016.   
          Would ratify the tribal-state gaming compact entered into  








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          between the State and the Pala Band of Mission Indians, executed  
          on May 6, 2016.


          SB 187 (Hall) of the current legislative session.  Would ratify  
          the tribal-state gaming compact entered into between the State  
          and the Jamul Indian Village, executed August 8, 2016.  


          AB 2915 (E. Garcia) of the current legislative session.   
          Provides for the ratification of a new Tribal-State gaming  
          compact between the State and Agua Caliente Band of Cahuilla  
          Indians, executed on August 4, 2016.


          AB 1977 (Wood) of the current legislative session.  Would ratify  
          the first amendment to the 2006 tribal-state gaming compact  
          entered into between the State and the Yurok Tribe, executed  
          August 4, 2016.  


          SB 1313 (Hall) of the current legislative session.  Would ratify  
          the tribal-state gaming compact entered into between the State  
          and the Yocha Dehe Wintun Nation, executed on August 4, 2016.  


          AB 1282 (Gray) of the current legislative session.  Would ratify  
          the tribal-state gaming compact entered into between the State  
          and the Buena Vista Rancheria of Me-Wuk Indians, executed on  
          June 28, 2016.  


          AB 1767 (Bigelow) of the current legislative session.  Would  
          ratify the first amendment to the 2015 tribal-state gaming  
          compact entered into between the State and the Jackson Rancheria  
          Band of Miwuk Indians, executed on June 22, 2016.  


          SB 404 (De León) of the current legislative session.  Would  
          ratify the tribal-state gaming compact entered into between the  
          State and the Viejas Band of Kumeyaay Indians, executed on June  
          22, 2016.  








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          AB 291 (Atkins) of the current legislative session.  Would  
          ratify the tribal-state gaming compact entered into between the  
          State and the Barona Band of Mission Indians, executed on June  
          22, 2016.  


          Prior legislation:  AB 795 (Atkins), Chapter 520, Statutes of  
          2015.  Ratified the tribal state gaming compact entered into  
          between the State and the Sycuan Band of Kumeyaay Nation,  
          executed on September 2, 2015. 


          AB 1540 (Gray), Chapter 531, Statutes of 2015.  Ratified the  
          tribal-state gaming compact entered into between the State and  
          the Santa Ynez Band of Chumash Indians, executed on August 26,  
          2015. 


          AB 315 (Bigelow), Chapter 512, Statutes of 2015.  Ratified the  
          amended and restated tribal-state gaming compact entered into  
          between the State and the United Auburn Indian Community,  
          executed on August 14, 2015. 


          AB 475 (Bigelow), Chapter 8, Statutes of 2015.  Ratified the  
          tribal-state gaming compact entered into between the State and  
          Jackson Rancheria Band of Miwuk Indians, executed on February 1,  
          2015. 


          SB 1356 (De León), Chapter 314, Statutes of 2014.  Ratified the  
          amendment to the tribal-state gaming compact entered into  
          between the State and the Viejas Band of Kumeyaay Indians,  
          executed on August 12, 2014. 


          SB 1224 (Correa), Chapter 300, Statutes of 2014.  Ratified the  
          tribal-state gaming compact entered into between the State and  
          the Karuk Tribe, executed on December 4, 2013. 









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          AB 1245 (V. Manuel Perez), Chapter 462, Statutes of 2013.   
          Ratified the tribal-state gaming compact entered into between  
          the State and the Ramona Band of Cahuilla Indians located in  
          Riverside County, executed on June 10, 2013. 


          AB 277 (Hall), Chapter 51, Statutes of 2013.  Ratified two new  
          compacts entered into between the State and the following  
          tribes:  North Fork Rancheria, executed on August 31, 2012, and  
          the Wiyot Tribe, executed on March 20, 2013. 


          AB 1267 (Hall), Chapter 6, Statutes of 2013.  Ratified the  
          amended tribal-state gaming compact entered into between the  
          State and the Shingle Springs Band of Miwok Indians, executed on  
          November 15, 2012. 


          SB 668 (Fuller), Chapter 67, Statutes of 2013.  Ratified the  
          tribal-state gaming compact entered into between the State and  
          the Fort Independence Indian Community of Paiute Indians,  
          executed on February 28, 2013.


          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.  Repealed those  
          provisions ratifying the tribal-state gaming compact entered  
          into between the State and Pinoleville Pomo Nation, executed on  
          March 9, 2009, and instead ratified the tribal-state gaming  
          compact entered into between the State and the Pinoleville Pomo  








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          Nation, executed on August 8, 2011.  


          AB 1020 (Chesbro), Chapter 27, Statutes of 2011.  Repealed the  
          ratification of the tribal-state gaming compact entered into  
          between the State and the Habematolel Pomo of Upper Lake,  
          executed on September 2, 2009, and instead ratified a new  
          tribal-state gaming compact entered into between the State and  
          the Habematolel Pomo of Upper Lake, executed on March 17, 2011.   



          SB 89 (Budget and Fiscal Review Committee), Chapter 1, Statutes  
          of 2010.  Ratified the tribal-state gaming compact entered into  
          between the State and the Habematolel Pomo of Upper Lake,  
          executed on September 2, 2009. 


          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 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 38, Statutes of 2007.  Ratified the  
          first compact amendment to the compact between the State and  
          Sycuan. 


          SB 175 (Ducheny), Chapter 39, Statutes of 2007.  Ratified the  
          first compact amendment to the compact between the State and  
          Morongo. 








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          SB 903 (Padilla), Chapter 40, Statutes of 2007.  Ratified the  
          first compact amendment to the compact between the State and  
          Pechanga. 


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


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


          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 (Núñez), 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.  


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









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                                                                    Page  24



          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. 


          Proposition 1A, adopted by the people of California on March 7,  
          2000.  Modified the prohibition against casinos and lotteries in  
          the California Constitution to authorize the Governor to  
          negotiate compacts, subject to legislative ratification, for the  
          operation of slot machines, lottery games, and banking and  
          percentage card games by federally recognized Indian tribes on  
          Indian lands in California, in accordance with federal law.   
          Authorized slot machines, lottery games, and banking and  
          percentage card games to be conducted and operated on Indian  
          lands subject to the compacts. 


          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.  Also, ratified 57 compacts  
          and created two special funds in the State Treasury (SDF and  
          RSTF), as specified. 


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


          Analysis Prepared by:                                             
                          Eric Johnson / G.O. / (916) 319-2531  FN:   
          0004894














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