BILL ANALYSIS Ó
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Isadore Hall, III
Chair
2015 - 2016 Regular
Bill No: AB 2102 Hearing Date: 6/28/2016
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|Author: |Roger Hernández |
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|Version: |3/15/2016 Amended |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Arthur Terzakis |
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SUBJECT: Tribal gaming: Indian Gaming Local Community Benefit
Committee
DIGEST: This bill requires each Indian Gaming Local Community
Benefit Committee (benefit committee) to adopt and approve a
Conflict of Interest Code pursuant to the state's Political
Reform Act and provides that any existing Conflict of Interest
Code must be reviewed and amended as necessary to bring it into
compliance with the requirements of the Act.
ANALYSIS:
Existing law:
1)The federal Indian Gaming Regulatory Act of 1988 provides for
the negotiation and execution of compacts for the purpose of
authorizing class III gaming on Indian lands within a state.
Additionally, the California Constitution authorizes the
Governor to negotiate and conclude compacts, subject to
ratification by the Legislature.
2)Creates in the State Treasury the Indian Gaming Special
Distribution Fund (SDF) for the receipt and deposit of moneys
received by the state from certain Indian tribes pursuant to
the terms of gaming compacts entered into with the state.
3)Authorizes the Legislature to appropriate money from the SDF
as follows: (a) grants for programs designed to address
AB 2102 (Roger Hernández) Page 2 of ?
gambling addiction; (b) grants for the support of state and
local government agencies impacted by tribal government
gaming; (c) compensation for regulatory costs incurred by the
California Gambling Control Commission (CGCC) and the
Department of Justice (DOJ) in connection with the
implementation and administration of compacts; (d) payment of
shortfalls that may occur in the Indian Gaming Revenue Sharing
Trust Fund (RSTF); (e) disbursements for the purpose of
implementing the terms of tribal labor relations ordinances
promulgated in accordance with the terms of the 1999 compacts;
and, (f) any other purpose specified by law.
4)Provides that the "priority" for funding from the SDF is in
the following descending order: (a) to make payments of any
shortfalls that may occur in the RSTF; (b) grants for programs
designed to address gambling addiction; (c) compensation to
the CGCC and DOJ for regulatory functions that directly relate
to Indian gaming; and, (d) grants for the support of local
government agencies impacted by tribal gaming.
5)Creates, until January 1, 2021, a County Tribal Casino Account
in the treasury of each county that contains a tribal casino,
which is funded according to specified formulas.
6)Requires the State Controller to divide the County Tribal
Casino Account for each county that has gaming devices that
are subject to an obligation to make contributions to the SDF
into a separate account, known as an Individual Tribal Casino
Account, for each tribe that operates a casino within the
county. Each Individual Tribal Casino Account is required to
be funded in proportion to the amount that each individual
tribe paid in the prior fiscal year to the SDF, and used for
grants to local agencies impacted by tribal casinos, as
specified.
7)Establishes an Indian Gaming Local Community Benefit Committee
in each county in which gaming is conducted, specifies the
composition and responsibilities of that committee, and
requires that committee to make the selection of grants from
the casino accounts. Among other things, the committee is
responsible for establishing all application policies and
procedures for grants from the casino accounts.
8)Requires the State Auditor to conduct an audit every three
years and report its findings to the Legislature regarding the
AB 2102 (Roger Hernández) Page 3 of ?
allocation and use of SDF grant monies.
9)The Political Reform Act of 1974 requires every agency to
promulgate and adopt a Conflict of Interest Code, which will
have the force of law, and any violation is deemed a violation
of state law. The Act provides that such a "code" shall
require that each designated employee file statements
disclosing reportable investments, business positions,
interests in real property and income. The Act also sets
forth specific circumstances under which designated employees
or categories of designated employees must disqualify
themselves from making, participating in the making, or using
their official position to influence the making of any
decision.
This bill:
1)Requires each benefit committee to adopt and approve a
Conflict of Interest Code pursuant to the state's Political
Reform Act and provides that any existing Conflict of Interest
Code must be reviewed and amended as necessary to bring it
into compliance with the requirements of the Act.
2)Deletes obsolete allocation provisions relating to the SDF and
makes other code maintenance changes.
Background
Indian Gaming Local Community Benefit Committees. As noted
above, existing law establishes benefit committees with
specified local government and tribal representation that are
responsible for establishing SDF grant application policies and
procedures, determining grant eligibility, and selecting grants
from Individual Tribal Casino Accounts or County Tribal Casino
Accounts based on "nexus test criteria" that mainly takes into
consideration the geographical proximity of an applicant local
government jurisdiction to the tribal casino.
All grants from Individual Tribal Casino Accounts are required
to be made only upon the affirmative sponsorship of the tribe
paying into the SDF from whose Individual Tribal Casino Account
grants are available for distribution. Priority uses for the
receipt of grant money from Individual Tribal Casino Accounts
are as follows: law enforcement; fire services; emergency
medical services; environmental impacts; water supplies; waste
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disposal; behavioral; health; planning and adjacent land use;
public health; roads; recreation and youth programs; and,
childcare programs.
Purpose of AB 2102. According to the author's office, this bill
is intended to address the State Auditor's recommendations
stemming from a 2011 review of the SDF and the benefit
committees. The Bureau of State Audits (BSA) found that members
of benefit committees do not always make the financial
disclosures required by state law. Although each member is
required to file a statement of economic interest, the audit
found that 12 of the 49 benefit committee members in four of the
seven counties whose grants were reviewed failed to file their
statements. Furthermore, two members filed statements more than
a year late. Several factors contributed to these omissions,
including the failure of some benefit committees to establish
conflict of interest codes that include each of the elements
required by state law as well as the failure of filing officers
who collect such forms to follow guidelines for administering
the process.
The State Auditor recommended that benefit committees ensure
that their conflict of interest codes comply with the Political
Reform Act by reviewing the Act and their codes, and changing
the codes as necessary to meet the Act's requirements. The
author contends that this bill will clarify existing law and
provide direction to benefit committees attempting to implement
the distribution of SDF grant monies.
Prior/Related Legislation
AB 1916 (Hall), Chapter 600, Statutes of 2014) created the
"Tribal Nation Grant Fund" in the State Treasury, to be
administered by the CGCC, for the receipt and deposit of moneys
received by the state from Indian tribes, pursuant to the terms
of tribal-state gaming compacts.
AB 1042 (Hall, Chapter 746, Statutes of 2013) required the
Department of Finance, in consultation with the CGCC, to
calculate the total revenue in the SDF that will be available
for the current budget year for local government agencies
impacted by tribal gaming. In addition, appropriated $13
million from the SDF to the CGCC to provide grants to local
agencies for the 2013-14 fiscal years.
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AB 2515 (Hall, Chapter 704, Statutes of 2012) required each
grant applicant to show how the grant will mitigate the impact
of the casino on the grant applicant. Also, appropriated $9.1
million from the SDF to the CGCC to provide grants to local
agencies for the 2012-13 fiscal years.
AB 1417 (Hall, Chapter 736, Statutes of 2011) as introduced,
this bill would have reorganized statutes pertaining to Indian
gaming compacts primarily by moving them to a newly created
Title 16.5 on Tribal Gaming in the Government Code. AB 1417 was
subsequently gutted in this committee to become the vehicle for
the distribution of $9.1 million from the SDF to the CGCC to
provide grants to local agencies.
AB 1039 (Perea, 2011), would have declared the intent of the
Legislature to establish a fair and proportionate system to
award SDF grants. (Held in Assembly Rules Committee)
AB 742 (Nestande, 2011) would have required grant applicants
applying for local mitigation funding from the SDF to
demonstrate how the grant will be used to mitigate the impact of
a casino and would have required Indian Gaming Local Community
Benefit Committees to adopt a conflict of interest code. AB 742
was gutted in this committee, to prohibit a specific mining
operation proposed in Riverside County at a location that the
Pechanga Tribe considers a most important sacred place. (Held
in Senate Rules Committee)
SB 856 (Budget and Fiscal Review, Chapter 719, Statutes of 2010)
among other things, appropriated $30 million from the SDF to
restore funding deleted from the Budget Act of 2007 for grants
to mitigate the impact of tribal gaming on local governments.
AB 158 (Torrico, Chapter 754, Statutes of 2008) enacted several
recommendations proposed by the BSA relative to the allocation
and use of proceeds from the SDF.
SB 288 (Battin, Chapter 13, Statutes of 2006) appropriated $20
million from the SDF for grants to local jurisdictions impacted
by tribal gaming.
SB 621 (Battin, Chapter 858, Statutes of 2003) established,
until 1/1/2009, priorities and procedures for specified funding
to local governments from the SDF for mitigating impacts from
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tribal casinos and appropriated $25 million from the SDF to
mitigate the impact of tribal gaming on local governments.
AB 673 (J. Horton, Chapter 210, Statutes of 2003) provided that
money in the SDF may be used to make payment of shortfalls that
may occur in the RSTF and specified that payment for those
shortfalls in the RSTF shall be the priority use of moneys in
the SDF. Also, appropriated the sum of $50.6 million for the
purpose of making payments to eligible Indian tribes for the
preceding fiscal year. In addition, established and provided
for the funding of the Office of Problem and Pathological
Gambling in the Department of Alcohol and Drug Programs.
AB 1385 (Battin, Chapter 874, Statutes of 1999) among other
things, ratified 57 tribal-state gaming compacts and created two
special funds in the State Treasury (SDF and RSTF) for the
deposit of revenues derived from Indian gaming and gaming device
licensing fees.
FISCAL EFFECT: Appropriation: No Fiscal
Com.: Yes Local: Yes
SUPPORT:
None received
OPPOSITION:
None received