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California Gaming Ballot Initiatives

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Know when to hold 'em, know when to fold 'em

SACRAMENTO, Calif. - Like the character in a song made famous by Kenny
Rogers in the 1970s, the promoters of two California ballot initiatives
related to Indian gaming know when to fold 'em. This brings the grand total
of Indian-gaming related initiatives expected to make the November ballot
down from four to two.

The apparent winners in the initiative sweepstakes are a proposal sponsored
by the a few of the state's card clubs and race tracks which will duel a
counterproposal with an initiative sponsored by the Agua Caliente tribe.
Both appear on the way to gathering the 589,105 voter signatures to make
their way onto the ballot.

Calling it quits are proposals by Stand Up for California Director Cheryl
Schmit, a noted gaming opponent and another that would allow a 29-year
"test" program for full-fledged casinos in Barstow and an urban casino in
Oakland.

Each proposed initiative would change the basic terms of state gaming
compacts with tribes. The racetrack proposal has drawn boos in recent weeks
because of its support from Hustler magazine mogul Larry Flynt. Flynt's
involvement has even inspired the slogan "Stop Larry Flynt" from the
initiative's opponents.

Also raising eyebrows is Los Angeles County Sheriff Lee Baca's support of
this measure despite recent criticisms that many of his campaign donors
would stand to benefit from this proposed measure.

Basically, the race track proposal calls for tribes to renegotiate their
compacts with the state to give up around a quarter of their revenues to
the state's general fund. If tribes do not comply within 90 days they
automatically lose their exclusive rights to conduct gaming operations in
the state.

The beneficiaries of this initiative are a small group of card clubs and
racetracks, which would be allowed to operate nearly 30,000 slot machines
if the tribes refuse to negotiate.

The Agua Caliente proposal seeks to allow tribal gaming expansion, lifting
the current cap of 2,000 machines licenses per casino and allow for
unlimited expansion. In return the tribe would pay the state the standard
corporate taxation rate of somewhere near 9 percent.

Agua Caliente Chairman Richard Milanovich told Indian Country Today earlier
this year the point of this initiative is to allow the casinos to expand at
a market rate and simultaneously allow the state to collect revenue in a
fair and even manner.

The Agua Caliente proposal has also drawn boos from its opponents because
of the actions of one of its backers, California state Sen. Jim Battin,
R-Palm Desert. Battin sent a letter to constituents trumpeting the proposal
on what looked like official letterhead. Though Battin pointed out that no
tax dollars were used, his actions have raised some eyebrows because of
significant tribal financial backing that Battin received from tribes.

A fourth initiative that would allow the casinos in Oakland and Barstow
also appeared doomed to failure and had never received the traction nor the
press attention of the other three.

Indian gaming consultant Michael Lombardi pointed out the Barstow/Oakland
initiative was written by one Robert Wilson who has made two previous
attempts at a similar initiative and received little interest nor
enthusiasm.

Though Schmit's proposal received much initial press attention Schmit said
that she did not have the money to collect the signatures required to place
the measure on the ballot.

"I estimated that it would cost somewhere between two and three million
dollars just to get the signatures on the ballot," said Schmit, who claimed
her proposal generated much interest at the grass roots level.

Lombardi countered Schmit's assessment of her proposal and claimed that the
fact that Schmit failed to collect the signatures as evidence of the lack
of her grassroots support.

Schmit opposes both the Agua Caliente initiative and the card room
initiative and though her organization has not yet issued a formal
statement she claimed they will as soon as the other initiatives qualify
for the ballot.

Lombardi and Schmit are old foes and often sit on opposite sides of the
fence on Indian gaming issues. Their acrimony is evident on a wide range of
issues. Though they disagree about the Agua Caliente proposal, Lombardi
supports it and Schmit opposes it, they have found common ground in their
opposition to the card room initiative.

While Lombardi criticizes Schmit for her somewhat puzzling professional
association with Sonoma County Supervisor Valerie Brown, who was employed
by Southern California cities with card clubs, he offers cautious praise
for her position on the proposed card room initiative.

"At least she is consistent," Lombardi said. "Though I disagree with most
things that she has done and stands for, I have to give her credit for
opposing the card club measure."

Supporters for both the Agua Caliente initiative and the card club
initiative claim that they have the required signatures. The next step is
to have this verified by California Secretary of State Kevin Shelley.