Casino Expansion

California Approves the Casino Expansion of the Penchanga Band of Luiseno Indians

On June 28, 2007, the California Assembly unanimously voted to allow the Penchanga Band of Luiseno Indians to expand their casino facility south of Temecula, removing a vital hurdle after a year of serious negotiations and campaign donations made by the Penchanga Tribe and other Indian tribes in the area.

Modified gambling agreements, known as gaming compacts would permit the Penchanga Tribe and 4 other Indian tribes to offer a total of 22,500 electronic slot machines instead of just the 10,000 slot machines on their reservations.

The gaming agreement of the Penchanga tribe would allow them to operate an additional 5,500 slot machines to the 2,000 slot machines that they are currently operating. The Indian tribes and Gov. Arnold Schwarzenegger signed the gaming compacts in August, just before the closing of the legislative session but the Assembly refused to resolve the matter on such short notice.

The state Senate supported it by a significant vote in April, but the chairman of the Assembly Committee from the Democratic Party said that the gaming compacts would not allow a thorough review of the financial status of the casino or enough protection for the casino staff.

The 4 Indian tribes in Southern California consented the financial oversight and a clause on salary garnishing on a series of agreements. The gaming agreements, which gave little bargaining power to the hotel workers union, sent the Democratic Assembly members into a series of talks last Thursday.

The UNITE HERE organization, sought to include a clause that would allow employees to unionize. The Republicans, whose rural and suburban jurisdictions include most of the Indian owned casinos, have voted in favor of them.

The Democrat representatives, whose districts include the homes of union employees, have second thoughts about the idea, though the Indian tribes changed that with political donations and lobbying since August.

The Indian tribes have repeatedly argued that the gaming compacts would put billions of dollars into the state coffers. Penchanga’s gaming compact states that the tribe can contribute a total of $42.5 million, an improvement from the $29 million under the current agreement. The Indian tribe would be required to pay an additional 15% of their winnings on the first 3,000 slot machines that the tribe adds and another 25% on the next 2,500 slot machines that the tribe will add.

Both Assembly Democrats and the nonpartisan analyst working on behalf of the legislature said that the estimates made by the tribe are unrealistic. The representatives of the Penchanga Tribe have also said that the tribe does not plan to install any of the 5,500 slot machines right away.

But the Penchanga Tribe is rapidly expanding their gaming complex. It opened a comedy club near a bigger theatre there. The tribe is also currently building a golf course on their reservation.

Penchanga Chairman, Marc Macarro, said that they are grateful for the support of the legislative leadership throughout the whole process.

Assembly members and their aides from the Republican Party commented that they believe that Assembly Speaker, Fabian Nunez, was a vital element in encouraging support among the Democrats for the gaming compacts.

A Whittier Law School professor, I. Nelson Rose, who publishes the newsletter Gambling and the Law, echoed that sentiment.

The tally on the gaming vote was initially listed at 61-8. Assembly regulations allow members to change their votes as long as the changes do not affect the result.

The proposal permitting the Penchanga expansion states that the Penchanga Indian tribe must negotiate its details with the Riverside County and Temecula, which is near the border of the 5,500 acre reservation of the tribe.