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NON-TRIBAL COMMERCIAL GAMBLING EXPANSION.
TRIBAL GAMING COMPACT AMENDMENTS.
REVENUES, TAX EXEMPTIONS.
Initiative Constitutional Amendment

THE QUESTION

Should the California Constitution be amended to permit up to 30,000 slot machines at 16 existing racetracks and card rooms not on Indian reservations unless all Indian tribes with existing tribal state gambling compacts agree to certain terms within 90 days?

THE SITUATION

Since 1999, 64 Indian tribes have signed compacts allowing them to operate gaming casinos on California Indian land. For this privilege, the tribes pay over $100 million per year, supporting smaller tribes. Currently there are 53 casinos with over 54,000 slot machines. Slot machine casinos are not legal in California outside of Indian tribal lands.

In June 2004, the Governor signed compacts with five leading tribes promising to preserve their casino gambling monopoly and allowing unlimited slot machines. The five tribes are required to make annual payments to the state. The state can use these payments for any purpose. Other tribes are expected to sign compacts, with expected total payments in the hundreds of millions of dollars.

Both Propositions 68 and 70 affect the numbers of California slot machines. If the two approved provisions are in conflict, only the measure with more yes votes will take effect.

THE PROPOSAL

Proposition 68 sets up two scenarios.

1. The state government would, within 90 days of the proposition’s passage, negotiate revised compacts with all tribes. The renegotiated compacts will require compliance with multiple state laws and payment to a state trust fund of 25 percent of slot machine revenues to support smaller tribes, public safety, .re.ghting and children’s services.
2. If all tribes do not accept such revisions within 90 days, .ve existing non-tribal racetracks and eleven existing non-tribal card rooms may operate up to 30,000 slot machines, paying 30 percent of the slot machine revenues to the state fund, 2 percent to the city and 1 percent to the county in which they are located. Racetracks would pay an additional 20 percent to bene.t the horse racing industry and increase purses.

FISCAL EFFECT

In the first scenario, potentially over $1 billion a year would be provided to the trust fund, with the money going mainly to local governments for additional child protection and public safety services.

In the second scenario, payments by racetracks and card rooms to the trust fund could potentially be over $1 billion. Cities and counties would receive additional unrestricted income. Also, any additional gambling-related activity would lead to an increase in state and local tax revenues.

WHAT A YES OR NO VOTE MEANS

A YES vote means that unless the state can renegotiate all existing Indian gaming compacts in 90 days, up to 30,000 slot machines can be established at 16 specific racetracks and card rooms.

A NO vote means that slot machines will continue to be confined to Indian casinos.

SUPPORTERS SAY

• California needs the billions of dollars that would be generated.
• Indian tribes in other states like New York and Connecticut pay their fair share of net revenues.
• If the Indian casinos won’t pay their fair share, they deserve to lose the slot machine monopoly.

OPPONENTS SAY

• Proposition 68 would allow 5 casinos in urban areas in the San Francisco Bay Area, in Los Angeles, and in San Diego County.
• The revenues cannot be used to balance the state budget.
• This measure would end the compacts already made with the tribes.

For more information:

Supporters: A Fair Share for California, (916) 551-2538, www.fairshareforcalifornia.org

Opponents: Californians Against Deceptive Gambling Proposition, (800) 420-8202, www.stop68.com

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