BILL ANALYSIS                                                                                                                                                                                                    Ķ



                                                                    SB 1187


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          SENATE THIRD READING


          SB  
          1187 (Lara)


          As Amended  August 11, 2016


          2/3 vote.  Urgency


          SENATE VOTE:  30-5


           ------------------------------------------------------------------ 
          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Appropriations  |19-0 |Gonzalez, Bigelow,    |                    |
          |                |     |Bloom, Bonilla,       |                    |
          |                |     |Bonta, Calderon,      |                    |
          |                |     |Daly, Eggman,         |                    |
          |                |     |Gallagher,            |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |Eduardo Garcia,       |                    |
          |                |     |Holden, Jones,        |                    |
          |                |     |Obernolte, Quirk,     |                    |
          |                |     |Santiago, Wagner,     |                    |
          |                |     |Weber, Wood, Chu      |                    |
          |                |     |                      |                    |
           ------------------------------------------------------------------ 


          SUMMARY:  Appropriates $36.6 million from the General Fund (GF)  








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          to the Department of Justice (DOJ) to pay two legal settlements,  
          as follows:


          1)Ballona Wetlands Land Trust v. Santa Monica Bay Restoration  
            Commission, $235,400; and 
          2)Pauma Band of Luiseņo Mission Indians of the Pauma & Yuima  
            Reservation v. State of California, et al., $36.3 million.


          Any funds appropriated in excess of the amounts required for the  
          claims revert back to the General Fund. 


          FISCAL EFFECT:  One-time GF appropriation of $36,555,686.11 to  
          DOJ for the two legal settlements.  


          COMMENTS:


          1)Purpose.  This bill is one of the bills carried by the Chairs  
            of the Appropriations Committees each year to provide  
            appropriation authority for legal settlements approved by DOJ  
            and the Department of Finance (DOF).  These settlements were  
            entered into lawfully by the state upon advice of counsel  
            (DOJ).  They are binding state obligations.


          2)Ballona Wetlands Land Trust v. Santa Monica Bay Restoration  
            Commission, $235,400.  This claim is the result of litigation  
            involving a California Public Records Act (PRA) dispute.   
            Petitioners, the Ballona Wetlands Land Trust (Land Trust)  
            sought records from the Santa Monica Bay Restoration  
            Commission (Commission) with the goal of proving that the  
            Commission had misused public grant funds in its management of  
            a restoration project.










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            The Commission responded by saying that the majority of the  
            records sought regarding the project were in the possession of  
            a separate, nongovernmental entity:  a private non-profit  
            called the Santa Monica Bay Restoration Foundation  
            (Foundation).  The Land Trust alleged that these two entities  
            (the Commission and the Foundation) were virtually identical,  
            with shared staff and a joint work plan, and that the  
            Foundation should be subject to PRA requests relating to that  
            partnership.  The Land Trust was told that only a subset of  
            the requested records would be disclosed, and in response,  
            filed a petition for writ of mandate in February of 2015.


            In March of 2016, the Superior Court found in favor of the  
            Land Trust, awarding attorney's fees and compelling the  
            Commission to disclose certain Foundation documents that the  
            Court declared to be public records, but not all documents  
            requested by the Land Trust.  Attorneys for DOJ collaborated  
            with counsel for the Commission to negotiate a settlement of  
            $220,000 for the payment of a portion of the Land Trust's  
            attorney's fees and costs.  The agreement also provides for  
            the payment of interest on the settlement amount at a rate of  
            7% per annum, calculated daily from March 1, 2016, the date  
            the Court issued its Final Statement of Decision.

            This bill provides an appropriation that includes the  
            settlement amount of $220,000 plus $15,400, or the equivalent  
            of a full year of interest payment.  A portion of the interest  
            amount will revert to the General Fund, assuming the bill is  
            enacted this month. 

          3)Pauma Band of Luiseņo Mission Indians of the Pauma & Yuima  
            Reservation v. State of California, et al., $36.2 million.  In  
            September, 2009, Pauma sued the State seeking rescission of  
            its 2004 amended Triable-State gaming compact (2004  
            Amendment).  In support of is rescission claim, Pauma alleged  
            that the State misrepresented the number of gaming device  
            licenses available under the parties' previous 1999  
            Tribal-State gaming compact.  (1999 Compact) when the State  








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            communicated that the license pool was exhausted December,  
            2003.  Pauma claimed that the misrepresentation induced it to  
            enter into the 2004 Amendment, which contained higher fees  
            than the 1999 Compact.  In support of the Pauma's claim that  
            it was entitled to rescission of the 2004 Amendment as a  
            result of the misrepresentation, Pauma relied on a 2009  
            district court decision in another case, Cachil Dehe Band of  
            Wintun Indians of the Colusa Indian Community v. California,  
            in which the court determined that the 1999 Compact did in  
            fact authorize more licenses than the state said were  
            available.  In 2010, the Ninth Circuit upheld the Colusa  
            decision. 

            In 2014, the district court granted summary judgment to Pauma,  
            finding that, pursuant to the Colusa II decision, the State  
            had misrepresented the number of gaming device licenses under  
            the 1999 Compact and that Pauma had been induced to enter into  
            the 2004 Amendments as a result.  The district court thus  
            ordered the 2004 Amendment rescinded and Pauma restored to its  
            1999 Compact's license fee provisions, resulting in a refund  
            of $36,235,147.01, plus $85,139.60 in interest, due to Pauma  
            from the State, representing the total fees Pauma paid the  
            Sate under the 2004 Amendment over what it would have paid had  
            it remained under the 1999 Compact. 

            The state appealed the summary judgment in favor of Pauma.  A  
            divided panel of the Ninth Circuit issued a published decision  
            upholding the district court's summary judgment in favor of  
            Pauma on the misrepresentation claim.  The court upheld the  
            monetary award against the state, though the court regarded  
            the monetary relief as restitution flowing from rescission of  
            the 2004 Amendment rather than specific performance, and found  
            that the State had waived its Eleventh Amendment sovereign  
            immunity from monetary restitution awards by express waiver  
            language in the compacts. 

            The State filed a petition for a writ of certiorari in the  
            United States Supreme Court, and the court denied the State's  
            petition on June 27, 2016.  All avenues of appeal having been  








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            exhausted, the judgment is final and the sum of $36,320,286.61  
            is due and payable to Pauma. 



          Analysis Prepared by:                                             
                          Pedro Reyes / APPR. / (916) 319-2081  FN:  
          0003952