BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 374|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
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CONSENT
Bill No: SB 374
Author: Hall (D)
Introduced:2/24/15
Vote: 21
SENATE GOVERNMENTAL ORG. COMMITTEE: 7-0, 4/28/15
AYES: Hall, Block, Hernandez, Hill, Hueso, Lara, McGuire
NO VOTE RECORDED: Berryhill, Gaines, Galgiani, Vidak
SUBJECT: Tribal gaming: local agencies
SOURCE: Author
DIGEST: This bill deletes obsolete allocation provisions
relating to the Indian Gaming Special Distribution Fund (SDF)
and makes other code maintenance changes.
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 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
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as follows: (a) grants for programs designed to address
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)Requires the State Auditor to conduct an audit every three
years and report its findings to the Legislature regarding the
allocation and use of SDF grant moneys.
This bill deletes obsolete allocation provisions from specified
fiscal years relating to the SDF and makes other minor code
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maintenance changes.
Background
Purpose of SB 374. According to the author's office, this bill
is simply intended to make technical, clarifying and conforming
changes to current statutes pertaining to the SDF. The author's
office also notes that at some point this bill may be used as a
vehicle to address issues brought forth by various entities at a
March 24, 2015 informational hearing conducted by the Senate
Governmental Organization Committee titled, "Confronting
Shortfalls in Indian Gaming Funds - the Special Distribution
Fund (SDF) and the Revenue Sharing Trust Fund (RSTF)."
During the informational hearing, the Legislative Analyst's
Office (LAO) reported that the Legislature has ratified
tribal-state gaming compacts with 73 of the State's 110
federally recognized tribes. Of these tribes, 58 currently
operate 60 casinos. These compacts require that the tribes make
payments to various state accounts under certain conditions.
Specific payment requirements differ across tribes and depend on
various factors, such as the number of slot machines operated
and/or the average slot machine net win. Currently, 46 tribes
make payments into the following three state accounts: (1) the
RSTF receives payments from 37 tribes; (2) the SDF receives
payments from 26 tribes; and, (3) the General Fund receives
payments from 11 tribes.
The LAO indicated that "as a result of amendments to several
tribal state compacts that were ratified beginning in 2007, the
SDF has seen significant decline in its fund balances. This is
because the amended compacts decreased the amount of revenue
that certain tribes are required to pay into the SDF by
requiring that these tribes instead make payments to the General
Fund." Furthermore, the LAO stated that "the expenditures in
excess of revenues were supported by using prior-year fund
balances in the SDF and that the SDF fund balance is expected to
be exhausted in the current year."
FISCAL EFFECT: Appropriation: No Fiscal
Com.: No Local: No
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SUPPORT: (Verified 4/28/15)
None received
OPPOSITION: (Verified 4/28/15)
None received
Prepared by:Arthur Terzakis / G.O. / (916) 651-1530
4/29/15 16:13:06
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