Senate committee reviews amendments to four tribal gaming compacts, no vote taken

The California State Senate Committee on Governmental Organization held an informational hearing to review amendments to three tribal-state class III gaming compacts and a proposed new compact, administration and tribal officials said. The hearing was informational only; the committee took no vote.

Matthew Lee, senior adviser for tribal negotiations in the Office of Governor Gavin Newsom, told the committee the compacts and amendments reflect changes required by the Ninth Circuit’s recent “Chicken Ranch” decisions and the federal Indian Gaming Regulatory Act (IGRA). “We no longer bargain for those off‑list prohibited terms under Chicken Ranch,” Lee said, identifying environmental review requirements, broad tort provisions and obligations to enforce state child and spousal support orders as examples of provisions the courts found to be overbroad.

The updated agreements presented include compact terms that Lee described as broadly consistent with the state’s recent compacts: a mechanism to defray state regulatory costs (the special distribution fund), a separate impact mitigation fund that applies when a tribe operates more than 350 gaming devices, and narrowly defined revenue arrangements that avoid appearing as a state tax on tribes. Lee said the state’s regulatory appropriation for tribal gaming historically has been in the “ballpark of $30 million, sometimes as high as $40 million,” and that appropriation is allocated pro rata to tribes based on the number of gaming devices; he offered to follow up with committee staff on specific, compact‑by‑compact numbers.

Cher‑Ae Heights Indian Community of the Trinidad Rancheria Matthew Lee said the compact with the Cher‑Ae Heights Indian Community of the Trinidad Rancheria is “broadly consistent” with other recent compacts. Under that agreement the tribe would be allowed to operate up to 1,200 gaming devices at up to three facilities, with standard revenue and mitigation terms to defray regulatory and local impacts. Lee also noted the tribe retained a term allowing use of international or model building codes after negotiation.

Picayune Rancheria of the Chukchansi Indians (extension) Lee and other speakers told the committee that one compact amendment before the committee is in a different posture: Picayune Rancheria and the state have been unable to reach a final agreement and are engaged in litigation. To preserve the status quo while that lawsuit proceeds, the parties have agreed to a one‑year rolling extension of the existing compact. Lee said the amendment also contains a standard form allowing off‑track wagering on horse racing. Michael Wynne, tribal council secretary for the Picayune Rancheria of the Chukchansi Indians, described tribal revenues as supporting tribal services and local economies and gave employment estimates: “we’ve got roughly 1,200 employees at the casino. About 92 to 95% are non‑tribal,” and later referenced “roughly 1,500 jobs that are provided under this compact extension,” comments he made on the record.

A compact updated from 2011/2012 (described by state staff) Lee described another compact amendment that updated a 2011 agreement that took effect in 2012. He said the tribe covered by that compact has not yet built a gaming facility and that the amendment narrows the definition of “gaming facility,” removes the environmental‑review and family‑law enforcement terms called out in Chicken Ranch, and revises revenue terms so they align with the state’s more granular approach: a special distribution fund for regulatory costs, an impact mitigation fund if a tribe operates more than 350 devices, and a separate revenue‑sharing trust fund concept that applies only in particular circumstances. Lee said the compact continues to authorize fewer than 1,200 devices and that the number of devices for that compact remains “900 unchanged,” as described on the record.

Sycuan Band of the Kumeyaay Nation Lee said the first amendment to the compact with the Sycuan Band of the Kumeyaay Nation includes the same post‑Chicken Ranch updates and also resolved a potential dispute with the tribe. Under the amendment the existing compact is extended for 10 years and contains a mutual agreement that the tribe will not challenge certain revenue provisions; the state agreed to bargain in good faith if new forms of gaming are legalized. Cody Martinez, chairman of the Sycuan Band of the Kumeyaay Nation, told the committee Sycuan employs “over 3,000 team members” and celebrated “42 years of Indian gaming” this year, adding the tribe sees itself as a partner in the local economy.

Questions and follow‑up Committee members pressed administration staff for compact‑by‑compact numbers that quantify how much revenue flows to the state to defray regulatory costs, and how the state measures “recovery” of those costs. Senator Blakesburg asked for the actual numbers and the mechanics of the pro rata allocation; Lee said he would follow up with precise figures, and he and the chief consultant agreed to work with the California Gambling Control Commission to provide recent appropriation and allocation data to committee staff.

No committee vote was taken; the chair closed the informational hearing and directed staff to collect the follow‑up data requested by members.