SACRAMENTO, Calif. - Just because Gov. Gray Davis is famously out, it does not mean his administration is necessarily down. On Oct. 20, the Davis administration, which is now in its waning days, announced that it had signed a compact with the Fort Mojave tribe for a 350-machine casino just west of the Arizona border town of Needles.
The compact marks the first time that such a deal was approved at an off-reservation site by a tribe with a continuous existence. Both the Davis administration and the 1,100 plus member tribe say that the reason for this was to move the proposed casino out of the city of Needles to isolate it from that city's other businesses, schools and churches.
"This is not the most economically feasible site, but a better site for the local community," said tribal attorney Rob Rosette.
Terms of the new compact follow three others recently signed. The tribe agrees to give 5 percent of its gaming machine profits to the state's general fund, which mirrors recently-penned deals with the Santa Isabel and La Posta tribes. Another compact signed recently with the Torres Martinez tribe, will incrementally give a percentage of their profits to the state's general fund that will top out at 5 percent after their third year in business.
Because of the unique jurisdictional locale of Fort Mojave tribal lands, California represents the third state in which the tribe has entered into a compact. Tribal lands straddle the border areas between California, Arizona and Nevada. Fort Mojave already operates the 181-machine Spirit Mountain Casino in Arizona and a 700-machine facility in the booming gambling town of Laughlin, Nev., each about 15 miles distant from the proposed California site.
Not only does this make Fort Mojave the first tribe to have compacts with three states, they will now become the first tribe to operate three Class III gaming facilities. Though the distinctions are often blurred with new technologies, Class III gaming status generally means that tribes are allowed to operate the type of gaming machines such as slots that are legal in Nevada and Atlantic City, New Jersey.
California Nations Indian Gaming Association (CNIGA) Executive Director Jacob Coin, reports that the Seminole tribe in Florida operates at least three casinos, but not all are Class III.
Cheryl Schmitt, director of Stand Up for California, a group that opposes gaming, says that while she accepts some of the basic points of the deal, she is uneasy with the precedent it may set for off-reservation casinos.
"It is bothersome that this deal appears to open up the floodgates for urban gaming," Schmitt said in reference to a few pending deals for off reservation casino sites in California's urban areas.
It should be noted that the proposed California Fort Mojave casino will actually be situated about three miles to the west of Needles in what is now open desert land. However, it is unclear as to whether or not this agreement will be seen as a precedent for the urban land deals.
Like several existing compacts, the Fort Mojave deal also includes a Memorandum of Understanding with the San Bernardino county government regarding mitigation of local impacts including road upgrades. This follows the recent trends of compact negotiations of entering into agreements with local governments.
Because of the fact that the tribe already makes money at its other locations, the tribe claims that they have not sought any additional financial backers for the project and tribal chairwoman Nora McDowell said the tribe is looking to finance the casino itself.
McDowell also maintains that the tribe has not sought an outside management company to run the casino through its first years of existence, which is permissible under the terms of most state compacts.
The compact also allows for the new facility to be under the legal jurisdiction of the tribal courts, a move that is hailed by the tribe as a "state recognition of the sophistication of the tribal courts."
Though the compact has been signed there are still legal hurdles for the tribe. The first is that that BIA must make a two-part determination on the deal since the land is currently held in trust and has been since 1991. This is the first time that the BIA's two-part determination has applied in California since it only deals with lands acquired by an established tribe that was not re-recognized after the Indian Gaming Regulatory Act was signed by former President Ronald Reagan in 1988. The first determination the BIA must make is whether it is beneficial to the tribe and the second is whether the deal would negatively impact the local community.
If successful in their two-part determination, it then has to be approved by the California legislature and signed off on by the governor. Because of the recent recall election, the timeline would mean that ultimately Gov.-elect Arnold Schwarzenegger will have to put his signature on the deal. Schwarzenegger is expected to take over as governor in mid-November.
Here there are several complicating factors. During his campaign Schwarzenegger said he would try to make tribes "pay their fair share" to the state's general fund. He compared the deal other states, such as Connecticut, have made in which they receive as much as a quarter of revenue earnings.
However, McDowell says that there is no comparison between her tribe and the large gaming tribes of Connecticut. For example, the larger eastern operations, some of which have as many as 6,000 machines dwarf the Fort Mojave's proposed 350-machine casino and that 5 percent is what is economically feasible for the tribe to contribute to the fund.
Gov.-elect Schwarzenegger has asked the Davis administration to halt any new appointments and deals. Kathryn Doi, who works in Gov. Davis' Department of Legal Affairs claims that this deal has been in the works since 2000 and that most of the language was finalized on Oct. 3, five days before voters ousted Davis.
Furthermore, Doi also said that she does not know the feelings of the incoming Schwarzenegger administration as she has yet to talk with members of his transition team regarding state-tribal compacts.
If approved, the tribe estimates that the casino will be operational in two to three years.