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California tribes ask for audit of State casino money fund

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SACRAMENTO, Calif. - "Show me the money," tribes are saying to the administration of California Governor Gray Davis, as questions grow about its handling of casino revenue sharing.

An influential tribal gaming lobby group is calling on the California State legislature to conduct an audit of the Davis appointed Gambling Control Commission. Simultaneously a group of tribes staged a large public relations event in Los Angeles to underscore dissatisfaction with the state's handling of funds set up by the tribal/ state gaming compacts.

The pleas by the California Nations Indian Gaming Association (CNIGA) to provide a full legislative audit of the controversial Commission have found a few friendly ears among the state's top lawmakers.

At issue is the Revenue Sharing Trust Fund, set up by the compacts that require gaming tribes with large operations to pay a percentage of their revenues to both non-gaming tribes and tribes with only miniscule casino operations.

According to the compacts, payments are supposed to be disbursed by the state each quarter.

CNIGA Executive Director Jacob Coin says his group decided to ask for the legislative audit after the state failed to dole out the payments in six of the quarters in which it was required to make them. The state has only made three payments thus far, including a third scheduled payment that the Commission claims was mailed out on Oct. 22.

Coin says though the Commission is claiming that it made the Oct. 22 payment, he says his organization has yet to confirm that a single tribe has received it. He says it is the lack of timeliness that has most irked the tribes.

CNIGA Chairwoman Brenda Soulliere said many of the Distribution Fund recipients have been factoring the added funds into their budgets. She said she had heard several horror stories from tribes, though she can not confirm which ones, who have had tribal programs, including health care, and projects placed in jeopardy because they have not received payment.

"This is really screwing up some people," she said.

One member of the California state legislature, Jim Battin, R-La Quinta, a longtime critic of the Gambling Control Commission, has accused it of playing politics during budget talks. He said the Commission refused to disburse the Revenue Sharing Trust Fund until it was given a budget.

Battin, who freely accuses the Commission of "empire building," said that the California State Legislature is the only body that can provide adequate oversight. He said that the blame lay with Gov. Davis, who appointed the Commission, because Davis signed an executive order giving it greater authority than the original law, Senate Bill 8, originally imparted.

Battin questioned the legal authority of the Commission to handle the disbursement of the funds. He said the state Controller's office, which handles most payments of state funds, should do so, not the Commission.

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Commission counsel Pete Melnicoe argued that with the Oct. 22 payment, every cent that tribes are due has been disbursed. He blamed the delays on the fact that the Commission was not given an adequate budget to release the funds and on the tardiness of certain tribes in returning their eligibility certifications.

"I think it is disingenuous of CNIGA to call for the legislative audit when they haven't even spoken to us," said Melnicoe.

Melnicoe claimed that CNIGA did not even send a copy of its letter calling for the audit to the Commission itself and said the Commission is willing to meet with CNIGA to iron out all of these issues Furthermore, Melnicoe said that since the legislature has appropriated a "realistic amount of money" for the Commission, payments should run more smoothly.

Melnicoe also said that the Commission is already under regular review during the budget process.

However, both Coin and Soullier said that, as in the case of any government agency, the review needed to be broader in scope. It should monitor the group's activities beyond mere fiscal concerns. Coin said he found the lack of oversight for the Commission "disturbing."

"Look, our problem is that the Gambling Control Commission is saying that they have paid out all of the money, every cent of it. The problem is bigger than that, in that they have not behaved as if they were dealing with sovereign governments by controlling our money," said Coin.

More than $57 million has been paid into the Distribution Fund. It is estimated that the Oct. 22 payment gave approximately $185,000 to the non-gaming tribes.

Meanwhile on Oct. 30 in Los Angeles, a group of tribes staged an event to draw attention to the state's lack of timeliness in making payments to tribes.

A second specific fund, the Special Distribution Fund, was set up by the state legislature. Tribes make quarterly payments into the fund to offset costs to local governments, such as road improvements and public service costs impacted by tribal casinos.

The group staging the event is known as Tribal Alliance of Sovereign Indian Nations (TASIN), which is primarily an association of tribal governments in the Riverside and San Bernardino counties.

During the event, the tribes presented a "symbolic" check for $1 billion to state officials including Sen. Battin and Assembly Speaker Herb Wesson, D-Los Angeles. The $1 billion is supposed to symbolize the amount of money paid to the state over the next 18 years.

In reality, however, the tribes actually did make an estimated payment to the state of $16 million that was due to the Special Distribution fund on the day of the press event. The tribes say they are trying to make a point to the state about the importance of paying on time.

"We are keeping the pledge we made to the people of California and we expect the state to do no less in seeing that the terms of the compacts are kept," said Pechanga chairman Mark Macarro, who has been active in the compact discussions with the state.