Posted on 02/06/2008 9:27:25 AM PST by NormsRevenge
Gov. Arnold Schwarzenegger says he's counting on four wealthy Indian tribes and their expanding gambling operations to help close California's massive budget shortfall.
Voters gave their blessing Tuesday to the deals allowing the tribes to add thousands of slot machines. Now the question is: will the money really make much of a difference?
Propositions 94-97 give the tribes rights to 17,000 additional slot machines in exchange for promises to share hundreds of millions of dollars annually with the cash-strapped state. With about 96 percent of the votes counted Wednesday morning, the measures were leading by a margin of 56 percent to 44 percent.
How much California will actually take in is up for debate, especially in the next 18 months as the state struggles to close an estimated $14.5 billion shortfall.
The tribes' nonstop television ads in recent months have promised California will get about $400 million annually from the deals through 2030, totaling nearly $9 billion. Schwarzenegger bet weeks ago that they would pass, and his finance team has budgeted for the tribes' big checks to begin arriving in Sacramento by the end of the summer. That means he's banking that they will begin the work of installing new slot machines almost immediately.
Even if the governor and tribes are right, the deals would cover just 4 percent of the state's shortfall. And at most, the gambling revenue would amount to less than one half of 1 percent of the state's general fund budget in any given year through 2030.
The state's nonpartisan legislative analyst, Elizabeth Hill, has warned even those estimates are too rosy. She says the governor's betting on far too much revenue, far too soon.
Even as the tribes and their supporters celebrated their victory Tuesday night at a downtown Los Angeles ballroom, Roger Salazar, spokesman for the ballot fight, said it was too soon to say how quickly the slots would be installed - or exactly how much they'd be able to pay the state in the next year.
"We're probably looking at an additional $200 million over the next year but we'll wait till the dust settles before deciding how many slot machines the tribes will add," he said.
California's casino industry is already second only to Nevada's, and the new gambling compacts represents a 30 percent increase in the number of slots in the state.
"Voters said yes to hundreds of millions of dollars in new revenue for the state each year, and once again said yes to standing with California's Indian tribes" said Salazar.
The deals would not have required voter approval, but a coalition of two other gambling-rich tribes, a horse track owner and a casino-workers' union gathered nearly a million signatures to force referendums on the deals onto the ballot. They raised over $30 million to defeat the agreements, but the four tribes that stand to gain raised about $104 million, for a blitz of television ads to urge their approval.
Those opposed argued the deals unfairly consolidate casino wealth in the hands of a few tribes in the state while doing little to help dozens of others that remain in poverty across California. They also worried the deals would cut into race track profits, increase competition and curb workers' rights.
"They outspent us 4-to-1 and that makes it tough to win any political contest," said Scott Macdonald, spokesman for the opposition group, No on Unfair Gambling Deals. "There are real concerns about sharing more revenues with poor tribes, protecting workers and local communities who are losing a voice. We hope the governor is listening if he wants to do more of these."
The tribes' nonstop television ads in recent months have promised California will get about $400 million annually from the deals through 2030, totaling nearly $9 billion.
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The expected windfall will do little to nothing to make up for the incompetence of this state's leaders.
They continue to chase pipe dreams.. makes ya wonder what they are smoking in the pipe.
Due to retarded deals by Grey Davis and other Dems the Indians as of now pay ZERO casino taxes. For this sweetheart deal the Dems got big Injun campaign contributions
When Schwarzenegger first ran for governor the California tribes gave mega-donations to Bustamente because Arnold pledged to tax the tribes
I wonder how many Californians would read this headline and think
“I voted for that? I thought I was just voting for them to pay more taxes
to solve California’s budget problem!”
Anybody know a way to join a tribe? Adoption? Marriage? “Civil Union”?
They will own this state, very shortly.
It is time that Indian Tribes and their Reservations truely become soverign nations and operate as such or that they are eliminated.
Anybody know a way to join a tribe? Adoption? Marriage? “Civil Union”?
They will own this state, very shortly.
I have a better idea, legalize gambling for other than Indian Casinos and tax them, destroy the Indian monopoly. Apparently there is plenty of profit to go around, why let the Indians have it all?
I’ve never understood why Indian tribes are allowed to have casinos. Casino gambling in general is illegal in California. If I try to open up Dilbert’s casino, the vice squad would shut me down. I’m not a member of an Indian tribe. I am not of Indian ethnic background. Isn’t it against civil rights laws to allow a certain ethnic group to have a monopoly on a certain type of business, in this case, the gambling business?
Just as a side note to all of this, does anyone know how Indians can legally operate a casino when the rest of us would be arrested and shut down for doing the same thing?
Not true. They paid a chunk before and the increased amount is peanuts. Also, under Gray Davis, there was a Statewide CAP of 20,000 slot machines. Arnie did away with that CAP allowing only 4 tribes to increase by 17,000 machines in these deals alone. And he wants to approve even more! Just wait until the other 40+ tribes make similar backroom deals. Look forward to the casino in your neighborhood and other businesses (restaurants, markets, etc) closing when they can't compete with the tribes who aren't subject to the same regulations due to their sovereignty.
Props 94-97 Comparison - Current vs. Compact Amendment
Nevada-style slot machines allowed
Current If Passed
Prop 94 (Pechanga) 2,000 7,500
Prop 95 (Morongo) 2,000 7,500
Prop 96 (Sycuan) 2,000 5,000
Prop 97 (Agua Calientes) 2,000 5,000
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Total 8,000 25,000
Percent Increase 212%
Paid to State ($ in millions)*
Current If Passed (at least)**
Prop 94 (Pechanga) $29.0 $44.5
Prop 95 (Morongo) 29.0 38.7
Prop 96 (Sycuan) 5.0 23.0
Prop 97 (Agua Calientes) 13.0 25.4
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Total $76.0 $131.6
Percent Increase 73%
*Payments to state: I’ve never understood why Indian tribes are allowed to have casinos. Casino gambling in general is illegal in California. If I try to open up Dilbert’s casino, the vice squad would shut me down. I’m not a member of an Indian tribe. I am not of Indian ethnic background. Isn’t it against civil rights laws to allow a certain ethnic group to have a monopoly on a certain type of business, in this case, the gambling business?
Just as a side note to all of this, does anyone know how Indians can legally operate a casino when the rest of us would be arrested and shut down for doing the same thing?
The Republicans went along because they were broke and the Indians gave them big bucks to endorse.
Maybe this will slow down the tax increases..
In the meantime..this is a tax on the poor and ignorant(those who are bad at math and vote DemocRat)..so that is fine.
The Indians don't get all the profits. These casinos are run by L.V. Gambling interests. They couldn't get gambling legalized in California so did an end run on the voters, selling misleading legislation like these Props claiming budget problems. If there was an initiative on the ballot to legalize gambling, my guess is it would get defeated by large margins.
“Sovereignty”
I've never understood why the tribes need government approval for a casino. Reservations are supposedly soverign nations not controlled or subject to US laws.
Please square that with this article which I’m virtually sure was written when Arnold ran against Bustamente
http://www.indiangaming.com/regulatory/view/?id=26
To my knowledge California tribes pay no taxes on casino operations. No real taxes like the 25% cut Connecticut gets. California collects the piddling 123 million mentioned in the link. Corporate taxes etc
Wealthy tribes and the lack of limitations on their contributions to political campaigns could prove to be an enormous problem of buying candidates and influence in the future.
Local taxpayors pay the cost of the increased social and other services brought on by casinos. The costs of jails, roads, sewer capacity, emergency services, social services and an increase in social vices destructive to families are all born by local taxpayors as the casinos are not required to pay taxes to the local county or city. (Only a negotiated voluntary MOU can get some offsetting consideration for local communities.)
Arnie did the right thing promoting this. I live in a So Cal town with a casino and the tribe donates millions each year to to local fire, police and schools.
The proposition seems like a win-win situation. The tribes get to increase the number of slot machines in there existing casinos and in return over 10 years:
$10.2 billion in revenue sharing payments to the State’s General Fund;
$5.4 billion in State and local taxes;
$275 million in revenue sharing payments to local governments and;
$128 million in revenue sharing payments to non-gaming tribes.
$116.5 billion in economic output;
$44.5 billion in wages;
875,500 jobs.
Increase state regulatory oversight by allowing the state to conduct random audits and inspections of the tribes’ gaming;
Share tens of millions from tribes’ gaming revenues with non-gaming tribes;
Create stronger environmental standards for casino-related tribal projects;
and Require the tribes to increase coordination with local governments, police and fire agencies and compensate local communities for services.
Welcome to FR..
Just imagine how much better things will be as the Tribes assert more even political power for a pittance in return.
We live in an imperfect state, and have an imperfect revenue stream to support the burgoning socialist utopia... so any monies they give locally is likely to be greatly appreciated, but it may not always be there,, or without apparent strings.
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Figure 2 Key Facts About Current and Proposed Compacts With Pechanga Tribe |
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Current— |
Proposed— |
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Casinos allowed on tribal lands in Riverside County |
2 |
2 |
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Nevada-style slot machines allowed |
2,000 |
7,500 |
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Payments to the state |
Currently, around $29 million per year to two state funds. No payments to the state General Fund. |
At least $44.5 million per year. More payments when the tribe expands its casino operations. Nearly all of the money would go to the General Fund. |
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Environmental impacts and increased costs of local services |
Tribe must make good faith effort to reduce or avoid significant negative environmental impacts off of tribal lands. State uses funds paid by tribes to make grants to local governments. |
Before commencing specified casino projects, tribe and county and/or city would either: Enter into enforceable agreement to reduce or avoid significant environmental impacts and to pay for increased public service costs, or Go to arbitration to settle disagreements on these issues. |
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Expiration date |
December 31, 2020 |
December 31, 2030 |
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Please square that with this article which I’m virtually sure was written when Arnold ran against Bustamente
Because they don't call them "taxes." They didn't call them that then, and they still don't.
Pechanga Tribe Now Pays About $29 Million Per Year to the State. Under federal law, tribes do not pay most state and local taxes. Under the 1999 compacts, however, the Pechanga tribe and other tribes agreed to make annual payments to two state government funds.
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