Existing federal law, the Indian Gaming Regulatory Act of 1988, provides for the negotiation and execution of tribal-state gaming compacts for the purpose of authorizing certain types of gaming on Indian lands within a state. The California Constitution authorizes the Governor to negotiate and conclude compacts, subject to ratification by the Legislature. Existing law expressly ratifies a number of tribal-state gaming compacts, and amendments to tribal-state gaming compacts, between the State of California and specified Indian tribes.

The California Environmental Quality Act (CEQA) requires a lead agency to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project, as defined, that it proposes to carry out or approve that may have a significant effect on the environment, as defined, or to adopt a negative declaration if it finds that the project will not have that effect.

This bill would ratify the tribal-state gaming compact entered into between the State of California and the Buena Vista Rancheria of Me-Wuk Indians of California, executed on June 28, 2016. The bill would provide that, in deference to tribal sovereignty, certain actions are not projects for the purposes of CEQA.

This bill would declare that it is to take effect immediately as an urgency statute.

Existing federal law, the Indian Gaming Regulatory Act of 1988, provides for the negotiation and execution of tribal-state gaming compacts for the purpose of authorizing certain types of gaming on Indian lands within a state. The California Constitution authorizes the Governor to negotiate and conclude compacts, subject to ratification by the Legislature. Existing law expressly ratifies a number of tribal-state gaming compacts, and amendments to tribal-state gaming compacts, between the State of California and specified Indian tribes.

The California Environmental Quality Act (CEQA) requires a lead agency to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project, as defined, that it proposes to carry out or approve that may have a significant effect on the environment, as defined, or to adopt a negative declaration if it finds that the project will not have that effect.

This bill would ratify the tribal-state gaming compact entered into between the State of California and the Buena Vista Rancheria of Me-Wuk Indians of California, executed on June 28, 2016. The bill would provide that, in deference to tribal sovereignty, certain actions are not projects for the purposes of CEQA.

This bill would declare that it is to take effect immediately as an urgency statute.

The Gambling Control Act provides for the licensure of certain individuals and establishments involved in various gambling activities, and for the regulation of those activities, by the California Gambling Control Commission. Existing law authorizes the commission, for any cause deemed reasonable by the commission, to deny any application for a license, permit, or approval, to limit, condition, or restrict any license, permit, or approval, or to impose any fine upon any person licensed or approved. For purposes of the act, existing law defines applicant as any person who has applied for, or is about to apply for, a state gambling license, or other licenses, permits, or approvals, as specified.

This bill would revise the definition of applicant to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 1282

Author:(Gray)

As Amended Ver:August 8, 2016

2/3 vote. Urgency

Original Committee Reference: G.O.

SUMMARY: Ratifies the tribal-state gaming compact (Compact) entered into between the State of California (State) and the Buena Vista Rancheria of Me-Wuk Indians (Tribe) executed on June 28, 2016. Additionally, this bill provides that, in deference to tribal sovereignty, certain actions are not deemed projects for purposes of the California Environmental Quality Act (CEQA); and, stipulates, except as expressly provided, that none of the provisions shall be construed to exempt a city, county, or city and county, or the Department of Transportation from CEQA requirements.

The Senate amendments delete the Assembly version of this bill, and instead:

1. Ratify the tribal-state gaming compact between the State of California and the Buena Vista Rancheria of Me-Wuk Indians, which was executed on June 28, 2016.
2. Supersede the 2004 amended compact (SB 1117 (Burton), Chapter 856, Statutes of 2004) between the Tribe and the State of California.
3. Authorize the Tribe to operate 2,000 gaming devices within the boundaries of the Tribe's Reservation, as described (Appendix A).
4. State the Tribe has agreed to pay the State its pro rata share of costs the State incurs for the performance of its duties under this Compact as well as 6% of its "Net Win," to be shared with tribes that are not gaming or that otherwise are not substantially benefiting from gaming.
5. Provide a framework for the sharing of gaming revenue with the County and other local jurisdictions. Specifically, from its payments to the Revenue Sharing Trust Fund (RSTF) or the Tribal Nation Grant Fund (TNGF), the Tribe may take annual credits of up to 60% for infrastructure improvements that in part benefit county residents, fire, law enforcement, public transit, education, tourism, and other services including investments in renewable energy projects, water treatment or conservation projects and payments to support capital improvements and operating expenses for facilities within California that provide health care services to tribal members and other members of the local community.
6. This Compact: 1) provides a regulatory framework that respects the role of the tribal gaming agency as the primary regulator while also ensuring that state gaming regulators fulfill their responsibilities; 2) requires the Tribe to conduct its gaming activities pursuant to an internal control system that implements minimum internal controls that are no less stringent than those in federal regulations; 3) requires the Tribe to adopt a Tribal Labor Relations Ordinance, as specified; and, 4) contains provisions to protect the health and safety of patrons, guests, and employees.
7. Provide that, in deference to tribal sovereignty, certain actions are not deemed projects for purposes of the California Environmental Quality Act (CEQA); and, stipulate, except as expressly provided, that none of the provisions shall be construed to exempt a city, county, or city and county, or the Department of Transportation from CEQA requirements.
8. Provide once effective, this Compact shall be in full force and effect for 25 years following the effective date.
9. Contain an urgency clause, allowing this bill to take effect immediately upon enactment.

EXISTING LAW:

1. Provides, under the Indian Gaming Regulatory Act (IGRA), for the negotiation and conclusion of compacts between federally recognized Indian tribes and the State for the purpose of conducting Class III gaming activities on Indian lands within a State as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments.
2. Authorizes expressly a number of tribal-state gaming compacts between the State of California and specified Indian tribes.
3. Authorizes the conduct of Class III gaming activities to the extent such activities are permitted by state law, a gaming compact has been concluded by a federally recognized tribe and the State, and the compact has been approved by the Secretary of the Interior.
4. Limits the operation of Class III gaming activities to Indian lands acquired on or before October 17, 1988. Provides for certain exceptions to conduct gaming activities on Indian lands acquired after October 17, 1988.
5. Defines Indian lands to mean all lands within the limits of any Indian reservation, and any lands title to which is either held in trust by the United States (U.S.) for the benefit of any Indian tribe, or individual, or held by any Indian tribe or individual subject to restriction by the U.S. against alienation and over which an Indian tribe exercises governmental power.
6. Requires the State to negotiate to conclude a compact in good faith with an Indian tribe having jurisdiction over the Indian lands upon which the Class III gaming activity is to be conducted. Provides the U.S. district courts with jurisdiction over any cause of action initiated by a tribal government alleging that the State failed to negotiate in good faith to conclude a compact. Prescribes the remedy, mediation supervised by the courts, if it is found that the State failed to negotiate in good faith to conclude a compact.
7. Authorizes the Governor, under the California Constitution, to negotiate and conclude compacts, subject to ratification by the Legislature.

FISCAL EFFECT: Unknown

COMMENTS: On August 11, 2016, the Assembly Governmental Organization Committee held an informational hearing on the amended tribal gaming compact entered into between the State of California and the Buena Vista Rancheria of Me-Wuk Indians.

Brief History and Background:

The Buena Vista Rancheria of Me-Wuk Indians is a federally recognized Indian tribe that occupies a 67.5-acre Indian reservation, in Amador County. Me-Wuk Indians have occupied the area known as Buena Vista since at least 1817, and the Tribe has occupied the land constituting the Buena Vista Rancheria from as early as 1905.

The Buena Vista Rancheria was purchased in 1927 by the United States and held in trust for the Tribe. In 1958, Congress adopted the California Rancheria Act, which rescinded the federal recognition of several California Indian tribes, including the Buena Vista Me-Wuk Tribe. The California Rancheria Act (Act) also terminated the trust and reservation status of several California Indian Rancherias, including the Buena Vista Rancheria, and, pursuant to distribution plans established under the Act, distributed the Rancherias lands in fee to two individual Indians of the Tribe.

In 1979, the Indian residents of the Buena Vista Rancheria joined Indians from 16 other California Rancherias in a class action lawsuit in federal district court against the United States and the various counties in which the Rancherias were located to restore their recognition as Indians and tribes, and to restore the federal Indian reservation status of their lands.

In 1983, in settlement of that litigation, the federal district court entered as a stipulated judgment (Tillie Hardwick decision) an order 1) restoring to federally-recognized status the involved tribes, including the Buena Vista Me-Wuk Tribe, and 2) further restoring and confirming the involved individual Indian plaintiffs as Indians, within the meaning of federal law. In 1987, in further settlement of that same litigation, the federal district court entered as a stipulated judgment an order restoring the boundaries of the Buena Vista Rancheria.

In 2004, the BIA determined that only descendants of Louis and Annie Oliver qualify for membership in the Tribe, and that Rhonda Morningstar Pope and her children are the only individuals eligible for membership in the Tribe because they claim descendancy from the Oliver family.

The Tribe originally entered into a compact with the State in 1999 and in 2004. The 2004 amended compact also grants the Tribe exclusivity against Class III gaming from non-tribal interests within a 63 mile radius of its gaming facility; provided for revenue sharing contributions to non-gaming tribes through the RSTF for every gaming device that the Tribe operates over 350 devices; and, required the Tribe to reach agreements with Amador County to mitigate environmental impacts and pay for public services.

The tribe signed an agreement with Amador County in 2008 after over two years of negotiations that would have required the Tribe to pay a one-time $18 million payment as well as $8 million a year to offset the impacts of any new development including the costs of law enforcement. The County decided to not adhere to the deal, which would have restricted the new casino to 950 slots. An independent arbitrator upheld the terms of the proposed arrangement.

The Tribe has been involved in a legal battle that has gone on for many years against local officials (Amador County) for the right to construct a casino on its land about five miles south of the town of Ione. The most recent case went to the US District Court for the District of Columbia where, in March 2016, the Court ruled against the County's assertion that the proposed site for the casino was not a legal reservation for a gambling development. This Compact (Section 4.2) makes it explicit that the Tribe may only engage in Class III gaming on "eligible" Indian lands located within the boundaries of its reservation. The District Court said that the land is eligible for gaming – the County of Amador is appealing the decision.

According to information provided by the Tribe, Tribal Chairwoman Rhonda L. Morningstar Pope took office in December of 2004 and since that time, the Tribe has built its governmental infrastructure. The Tribe employs over 15 individuals that perform essential governmental and administrative functions. The Tribe operates a nonprofit child development center in Sacramento that serves native and low-income families. The Tribe oversees an Environmental Department that administers various programs, including cultural resource management, cultural repatriation, solid waste management, and Clean Water Act programs. The Tribe has revitalized and restored several vital cultural components on its reservation, including a dance arbor, riggings shacks, a sweat lodge, and an historic cemetery. A new 4,000 square foot cultural center is expected to be completed by the end of 2016.

The Tribe is committed to improving the environment, education status, and the health, safety and general welfare of its members and local residents.

Key Components of the Compact:

Scope of Class III Gaming Authorized: The Tribe may engage in Class III Gaming at no more than one facility located within the existing Indian lands deemed eligible for gaming under IGRA. The Tribe is entitled to operate up to a total 2,000 gaming devices.

Payments to the Special Distribution Fund (SDF): The Tribe shall pay to the State, on a pro rata basis, the costs the State incurs for the performance of all its duties under this Compact, as established by the monies appropriated in the annual Budget Act for the performance of their duties under the Class III Gaming Compacts each fiscal year for the California Gambling Control Commission (CGCC), the California Department of Justice, the Office of Problem Gambling, the State Controller, and any other agency or agencies responsible for implementation and administration of Class III gaming compacts.

Payments to the RSTF or the TNGF: If the Tribe operates more than 350 gaming devices at any time in a given calendar year, it shall thereafter, including in that calendar year, pay to the CGCC, for deposit into the RSTF or the TNGF, 6% of its "Net Win" from the operation of gaming devices in excess of 350.

"Net Win" is defined as the drop from gaming devices, plus the redemption value of expired tickets, less fills, less payouts, less that portion of the gaming operation's payments to a third-party wide-area progressive jackpot system provider that is contributed only to the progressive jackpot amount.

Credits Applied to the RSTF or the TNGF: The State agrees to provide the Tribe with annual credits for up to 60% of the payments otherwise due to be paid into the RSTF or TNGF for the following:

1. Payments to the County of Amador and local jurisdictions operating facilities or providing services within the County for improved fire, law enforcement, public transit, education, tourism, and other services and infrastructure improvements intended to serve off-reservation needs of County residents – such payments shall be subject to approval by the County or local jurisdiction in the County and at least 20% of the annual credits must be utilized for the above stated purposes. Specified annual payments by the Tribe made pursuant to an agreement between the County and the Tribe and approved by arbitration on June 11, 2008 and currently in effect are also eligible credits and will be deemed to have the approval of the County until termination of that agreement or its replacement with an amended or new intergovernmental agreement;
2. Payments by the Tribe for non-gaming related capital investments and economic development projects by the Tribe on tribal trust lands that the State agency agrees provides mutual benefits to the Tribe and the State because, for instance, they have particular cultural, social or environmental value, or diversify the sources of revenue for the Tribe's general fund;
3. Payments by the Tribe to support capital improvements and operating expenses for facilities within California that provides health care services to tribal members, Indians, and non-Indians;
4. Investments and any funds paid by the Tribe to the State in renewable energy projects that, in part, serve the gaming facility, and in projects that incorporate charging stations for electric or other zero emission vehicles that are available to patrons and employees of the gaming facility;
5. Investments by the Tribe and any funds paid to the State for water treatment or conservation projects that, in part, serve the gaming facility or any improvements incorporating water conservation or treatment technology on real property owned by the Tribe, or its members and lineal descendants; and
6. Payments by the Tribe to provide general welfare benefits for, among other things, educational, healthcare, cultural, or vocational purposes, to non-enrolled members of the Tribe and other Native American in the community.

All excess authorized credits that cannot be applied in any one year because they would exceed the 60% may be applied as an annual credit in all following years that this Compact is in effect, in the same percentages, until completely exhausted.

Exclusivity: Provides that in the event the exclusive right of Indian tribes to operate Class III gaming in California pursuant to the California Constitution is lost and other non-Indian entities are able to engage in Class III gaming the Tribe shall have the right to terminate this Compact, in which case the Tribe will lose the right to operate Class III gaming authorized by this Compact; or continue under this Compact, as defined.

Additional Compact Components:

Gaming Ordinance and Regulations: All gaming activities conducted under this Compact shall, at a minimum, comply with 1) a gaming ordinance duly adopted by the Tribe and approved in accordance with IGRA, 2) all rules, regulations, procedures, specifications, and standards duly adopted by the National Indian Gaming Commission (NIGC), the Tribal Gaming Agency, and the State Gaming Agency, and 3) the provisions of this Compact, as specified.

Licensing Requirements and Procedures: All persons in any way connected with the gaming operation or gaming facility who are required to be licensed or to submit to a background investigation under IGRA, and any others required to be licensed under this Compact, including, without limitation, all gaming employees, gaming resource suppliers, financial sources, and any other person having a significant influence over the gaming operation, must be licensed by the Tribal Gaming Agency and cannot have had any determination of suitability denied or revoked by the CGCC. In addition, every gaming employee must obtain, and thereafter maintain current, a valid tribal gaming license, as specified.

Minimum Internal Control Standards (MICS): The Compact requires the Tribe to conduct its Gaming Activities pursuant to an internal control system that implements MICS that are no less stringent than specified MICS of the NIGC. It requires gaming to operate pursuant to a written internal control system that reasonably assures that assets are safeguarded and accountability over assets is maintained, liabilities are properly recorded and contingent liabilities are properly disclosed, financial records are accurate and reliable, transactions are performed in accordance with the Tribe's authorization.

The Tribe is required to provide to the CGCC, upon written request, a copy of the independent certified public accountant agreed-upon procedures report conducted annually for submission to the NIGC pursuant to federal law. This report verifies that the gaming operation is in compliance with the NIGC's minimum internal control standards.

Patron Disputes: The Tribe must attempt to resolve patron disputes within three days of the play or operation of any game, including refusal to pay to a patron any alleged winnings from any gaming activities. If a patron is dissatisfied with the resolution, the Tribe shall inform the patron in writing within 15 days of the right to resolution of the dispute by the Tribal Gaming Agency. The Tribal Gaming Agency shall conduct an appropriate investigation, provide to the patron a copy of its procedures concerning patron complaints, and render a decision in accordance with industry practice. The decision shall be issued within 60 days of the patron's request. If dissatisfied with the resolution, the patron has the right to seek resolution either in the Tribe's tribal court system, once a tribal court system is established, or through binding arbitration of the dispute before a retired judge. Any party dissatisfied with the award of the tribal court or JAMS arbitrator may, at the party's election, invoke the JAMS Optional Arbitration Appeal Procedure. The cost and expense of arbitration shall initially be borne equally by the Tribe and the patron but the JAMS arbitrator shall award to the prevailing party its costs and expenses (but no attorney fees). The Tribe agrees to wave its sovereign immunity in connection with the jurisdiction of the tribal court system or JAMS Streamlined Arbitration and JAMS Optional Arbitration Appeal Procedure and in any action to enforce their judgments or the obligations provided in this section.

Public and Workplace Liability: The Tribe is required to obtain and maintain a commercial general liability insurance policy that provides coverage of no less than $10 million. The Tribe must adopt a Tort Liability Ordinance stipulating that California tort law governs claims. The Tribe must consent to jurisdiction in the Tribe's tribal court system, once a tribal court system is established, or before a three-member tribal claims commission. Any party dissatisfied with the award of the tribal venue may invoke the JAMS Optional Arbitration Appeal Procedure, as specified.

Environmental Protections: The Tribe must prepare a Tribal Environmental Impact Report (TEIR) and negotiate mitigation of any off-reservation impacts prior to initiating the development of a Project for a facility. The Compact provides procedures regarding the 1) Notice of Preparation of Draft TEIR, 2) Notice of Completion of Draft TEIR, and 3) Issuance of Final TEIR. The Tribe's failure to prepare an adequate TEIR when required may warrant an injunction where appropriate. Before commencement of a Project, and no later than the issuance of the final TEIR, the Tribe shall negotiate an intergovernmental agreement with the California Department of transportation (Caltrans) if state roads are impacted. A completed TEIR must be filed with the County of Amador, the Department of Justice, the CGCC, and the State Clearinghouse. In addition, before commencement of a Project, and no later than the issuance of the final TEIR, the Tribe shall offer to commence negotiations with the County of Amador to, amongst other things, provide for the timely mitigation of any significant effect on the off-reservation environment including provisions relating to compensation for law enforcement, fire protection, emergency medical services and any other public services, to the extent such services are to be provided by the County to the Tribe as a consequence of the Project.

Intergovernmental Agreement: Before the commencement of a project, and no later than the issuance of the Final Tribal Environmental Impact Report (TEIR) to the County, the Tribe shall offer to commence government-to-government negotiations with the County, and upon the County's acceptance of the Tribe's offer, shall negotiate with the County on a government-to-government basis and shall enter into enforceable written agreements with the County with respect to: 1) Timely mitigation of any significant effect on the off-reservation environment, as defined; 2) Compensation for law enforcement, fire protection, emergency medical services and any other public services to be provided by the County to the Tribe for the purposes of the Tribe's gaming operation as a consequence of the project; 3) Reasonable compensation for programs designed to address gambling addiction; and 4) Mitigation of any effect on public safety attributable to the project, including any compensation to the County as a consequence thereof.

Enhanced Audit and Compliance Review Procedures: In addition to providing for an annual independent audit, a copy of which must be submitted to the CGCC, the Compact allows the state to conduct its own annual audit and compact compliance review.

Inspection and Testing of Slot Machines: All gaming devices must be tested, approved and certified by an independent gaming test laboratory or state governmental gaming test laboratory to ensure they are being operated according to specified technical standards, prior to being placed in operation. The Tribal Gaming Agency must maintain adequate records that demonstrate compliance with software and hardware specifications. The CGCC may inspect the Gaming Devices in operation at the Gaming Facility on a random basis not to exceed four times annually to confirm that the slot machines are operating in conformance with these standards.

Enhanced Audit and Compliance Review Procedures: In addition to providing for an annual independent audit, a copy of which must be submitted to the CGCC, the Compact allows the state to conduct its own annual audit and compact compliance review.

Labor Provisions: Provides that the gaming activities authorized by this compact may only commence after the Tribe has adopted an ordinance identical to the Tribal Labor Relations Ordinance (TRLO) provided for in Appendix C of the Compact, and the gaming activities may only continue as long as the Tribe maintains the ordinance. If the Tribe employs 250 or more persons in a tribal casino facility, then the provisions of the TLRO become effective. The TLRO provides for a secret ballot election. The new TLRO proscribed by this compact is modeled after the TLRO first incorporated into the compact with the Santa Ynez Band of Chumash Indians and reflects significant changes from the 1999 TLRO.

The TLRO provides for a neutrality agreement between the Tribe and union if the union requests this. If the union first offers in writing not to engage in strikes, picketing, boycotts, attack Web sites, or other economic activity at or in relation to the tribal casino or related facility and issue and deliver a Notice of Intent to Organize (NOIO) to the Tribe, then the Tribe must not disparage or advocate opposition to the union. The Tribe may make factual representations to employees concerning employment with the Tribe, but may not take actions or make statements that could reasonably be interpreted as criticizing the union or advocating against unionization. During the 365 days after the Tribe received the NOIO, the union must collect dated and signed authorization cards and complete the secret ballot election. Secret ballot elections shall be held at a location or locations determined by the employer, but there must be at least neutral location. Employee may mail ballots so long as received by Election Day. Failure to complete the secret ballot election within 365 day under the neutrality agreement shall preclude the union from delivering another NOIO for a period of 730 days

Where there is a neutrality agreement, the TLRO provides for resolution of collective bargaining impasse through interest arbitration by the Federal Mediation and Conciliation Service (FMCS). The interest arbitration procedure is modeled on the Mandatory Mediation and Conciliation provisions in the Agricultural Labor Relations Act. Other disputes are presented to an arbitrator with expertise in labor law. Appropriate challenges to the arbitrator's decision may be presented in court.

Workers' Compensation: The Tribe agrees to participate in the state's workers' compensation program with respect to employees at the casino. All disputes arising from the workers' compensation laws shall be heard by the State Workers' Compensation Appeals Board pursuant to the California Labor Code. In lieu of participation in the State's system, the Tribe may create and maintain a system through self-insurance, which includes specified provisions, including hearings before an independent tribunal. Furthermore, the Tribe agrees that it will participate in the state's unemployment compensation program for providing benefits and unemployment compensation disability benefits to employees at the casino. The Tribe shall withhold all taxes due to the state, except for Tribal members living on the Tribe's reservation, and forward such amounts to the state.

Prohibitions Regarding Minors: The Tribe shall prohibit persons under the age of 18 years from being present in any room or area in which gaming activities are being conducted unless the person is en route to a non-gaming area of the gaming facility, or is employed at the Gaming Facility in a capacity other than as a gaming employee.

Alcohol Provisions: Makes it explicit that the purchase, sale, and service of alcoholic beverages shall be subject to the Alcoholic Beverage Control Act. The Tribe shall prohibit persons under the age of 21 years from purchasing, consuming, or possessing alcoholic beverages.

Use and Sale of Tobacco: The Tribe agrees to provide a non-smoking area in the gaming facility and to utilize a ventilation system throughout the gaming facility that exhausts tobacco smoke to the extent reasonably feasible under state-of-the-art technology existing as of the date of the construction or significant renovation of the gaming facility, and further agrees not to offer or sell tobacco products, including but not limited to smokeless tobacco products or e-cigarettes, to anyone younger than the minimum age specified in state law to legally purchase tobacco products.

Problem Gambling: Requires the gaming operation to establish a program, approved by the Tribal Gaming Agency, to mitigate pathological and problem gaming by implementing specified measures.

Health and Safety Standards: The Tribe has agreed to adopt and comply with tribal health standards for food and beverage handling that are no less stringent than State public health standards. In addition, the Tribe has agreed to comply with federal water quality and safe drinking water standards applicable in California. The Tribe must adopt and comply with federal and state laws forbidding harassment, including sexual harassment, discrimination and retaliation. The Tribe must maintain a $3,000,000 insurance policy for these purposes and adopt an ordinance that includes a dispute resolution process.

Emergency Services Accessibility: The Tribe must make reasonable provisions for adequate emergency fire, medical, and related relief and disaster services for patrons and employees.

Building Codes and Fire Safety: Requires facilities to meet or exceed the California Building Code and the Public Safety Code applicable to Amador County. The Tribe must submit to fire safety inspections by the State, and to rectify deficiencies, lest be subject to court order prohibiting occupancy of the portion of the gaming facility with the deficiencies.

Amendment by Agreement: The terms and conditions of this Compact may be amended at any time by the mutual and written agreement of both parties, provided that each party voluntarily consents to such negotiations in writing. Any amendments to this Compact shall be deemed to supersede, supplant and extinguish all previous understandings and agreements on the subject.

Effective Date: This Compact shall not be effective unless and until all of the following have occurred: (a) The Compact is ratified by statute in accordance with state law and (b) Notice of approval or constructive approval is published in the Federal Register. Once effective, this Compact shall be in full force and effect for State law purposes until twenty-five (25) years following the effective date (2041).

Additional Background Information:

Rincon Decision: In 2004, the Rincon Band of Mission Indians sued the State in federal court after negotiations for a new gambling agreement with then-Governor Schwarzenegger fell apart. The Tribe believed the Governor was violating federal law by insisting that tribes pay money into the state's General Fund in exchange for more slot machines.

In July 2011, the United States Supreme Court declined to review a Ninth Circuit Court's decision that ruled the state could not require the Rincon Band tribe to pay a percentage of slot machine revenue into California's General Fund for more gaming devices. The Ninth Circuit had affirmed a lower court decision that the new financial concessions were nothing more than a state tax on tribal casino revenues, which is prohibited by IGRA. The court concluded that a "non-negotiable, mandatory payment of 10% of net win into the State treasury for unrestricted use yields public revenue and is [therefore] a tax and that the court was therefore required to consider the State's demand as evidence of bad faith under IGRA's statutes."

The Rincon decision has changed the dynamics of tribal-state compact negotiations in California.

SDF: Existing law creates the SDF in the State Treasury for the receipt of revenue contributions made by tribal governments pursuant to the terms of the 1999 model Tribal-State Gaming compacts and authorizes the Legislature to appropriate money from the SDF for the following purposes: 1) grants for programs designed to address gambling addiction; 2) grants for the support of state and local government agencies impacted by tribal government gaming; 3) compensation for regulatory costs incurred by CGCC and the DOJ in connection with the implementation and administration of compacts; 4) payment of shortfalls that may occur in the Indian Gaming RSTF; 5) disbursements for the purpose of implementing the terms of tribal labor relations ordinances promulgated in accordance with the terms of the 1999 compacts; and, 6) any other purpose specified by law. The distribution formula "sunsets" on January 1, 2021.

RSTF: Existing law also creates in the State Treasury the RSTF for the receipt and deposit of moneys derived from gaming device license fees that are paid into the RSTF pursuant to the terms of specified tribal-state gaming compacts for the purpose of making distributions to non-compacted tribes (e.g., federally-recognized non-gaming and tribes that operate casinos with fewer than 350 slot machines). Revenue in the RSTF is available to CGCC, upon appropriation by the Legislature, for making distributions of $1.1 million annually to non-compact tribes. The RSTF was created as part of the 1999 compacts, which, in conjunction with the passage of Proposition 1A (2000), created gaming compacts with approximately 60 California tribes. Non-compact tribes are considered third-party beneficiaries of the 1999 compacts.

According to CGCC, which administers the RSTF, a revenue shortfall of approximately $15.5 million is anticipated this fiscal year. According to the Department of Finance (DOF), the SDF has sufficient funds in it for fiscal year 2016-2017 to cover the RSTF shortfall. However, DOF indicates that it projects a $1.6 million SDF balance deficiency in fiscal year 2017-2018 assuming a $25 million transfer to the RSTF. To cover the anticipated shortfall in 2017-2018, approximately $1.6 million will need to be transferred from the General Fund in order to ensure full RSTF payments are made to non-gaming and limited-gaming tribes. A similar amount was redirected in 2015-2016. Recent compacts, including this one, have attempted to alleviate the shortfall situation by requiring payments by Tribes directly to the RSTF. This model appears to be a template for future compacts, as well.

TNGF: The TNGF was created in the Graton Rancheria compact (AB 517 (Hall), Chapter 12, Statutes of 2012), as a new destination for gaming revenue for distribution of funds to non-gaming and limited-gaming tribes, upon application of such tribes for purposes related to effective self-governance, self-determined community, and economic development. The fund is designed to be fluid and payments are intended to be made to non-gaming tribes on a "need" basis, upon application by non-gaming tribes. The TNGF currently does not receive funding.

Related legislation: AB 629 (Gonzalez) of the current legislative session. Would ratify the tribal-state gaming compact entered into between the State and the Pala Band of Mission Indians, executed on May 6, 2016.

SB 187 (Hall) of the current legislative session. Would ratify the tribal-state gaming compact entered into between the State and the Jamul Indian Village, executed August 8, 2016.

AB 2915 (Eduardo Garcia) of the current legislative session. Provides for the ratification of a new Tribal-State gaming compact between the State and Agua Caliente Band of Cahuilla Indians, executed on August 4, 2016.

AB 1977 (Wood) of the current legislative session. Would ratify the first amendment to the 2006 tribal-state gaming compact entered into between the State and the Yurok Tribe, executed August 4, 2016.

SB 1313 (Hall) of the current legislative session. Would ratify the tribal-state gaming compact entered into between the State and the Yocha Dehe Wintun Nation, executed on August 4, 2016.

AB 1767 (Bigelow) of the current legislative session. Would ratify the first amendment to the 2015 tribal-state gaming compact entered into between the State and the Jackson Rancheria Band of Miwuk Indians, executed on June 22, 2016.

AB 2358 (Gonzalez) of the current legislative session. Would ratify the tribal-state gaming compact entered into between the State and the Pechanga Band of Luiseno Indians, executed August 4, 2016.

SB 404 (De León) of the current legislative session. Would ratify the tribal-state gaming compact entered into between the State and the Viejas Band of Kumeyaay Indians, executed on June 22, 2016.

AB 291 (Atkins) of the current legislative session. Would ratify the tribal-state gaming compact entered into between the State and the Barona Band of Mission Indians, executed on June 22, 2016.

Prior legislation: AB 795 (Atkins), Chapter 520, Statutes of 2015. Ratified the tribal state gaming compact entered into between the State and the Sycuan Band of Kumeyaay Nation, executed on September 2, 2015.

AB 1540 (Gray), Chapter 531, Statutes of 2015. Ratified the tribal-state gaming compact entered into between the State and the Santa Ynez Band of Chumash Indians, executed on August 26, 2015.

AB 315 (Bigelow), Chapter 512, Statutes of 2015. Ratified the amended and restated tribal-state gaming compact entered into between the State and the United Auburn Indian Community, executed on August 14, 2015.

AB 475 (Bigelow), Chapter 8, Statutes of 2015. Ratified the tribal-state gaming compact entered into between the State and Jackson Rancheria Band of Miwuk Indians, executed on February 1, 2015.

SB 1356 (De León), Chapter 314, Statutes of 2014. Ratified the amendment to the tribal-state gaming compact entered into between the State and the Viejas Band of Kumeyaay Indians, executed on August 12, 2014.

SB 1224 (Correa), Chapter 300, Statutes of 2014. Ratified the tribal-state gaming compact entered into between the State and the Karuk Tribe, executed on December 4, 2013.

AB 1245 (V. Manuel Perez), Chapter 462, Statutes of 2013. Ratified the tribal-state gaming compact entered into between the State and the Ramona Band of Cahuilla Indians located in Riverside County, executed on June 10, 2013.

AB 277 (Hall), Chapter 51, Statutes of 2013. Ratified two new compacts entered into between the State and the following tribes: North Fork Rancheria, executed on August 31, 2012, and the Wiyot Tribe, executed on March 20, 2013.

AB 1267 (Hall), Chapter 6, Statutes of 2013. Ratified the amended tribal-state gaming compact entered into between the State and the Shingle Springs Band of Miwok Indians, executed on November 15, 2012.

SB 668 (Fuller), Chapter 67, Statutes of 2013. Ratified the tribal-state gaming compact entered into between the State and the Fort Independence Indian Community of Paiute Indians, executed on February 28, 2013.

AB 517 (Hall), Chapter 12, Statutes of 2012. Ratified the tribal-state gaming compact entered into between the State and the Federated Indians of Graton Rancheria of Sonoma County, executed on March 27, 2012.

AB 787 (Chesbro), Chapter 340, Statutes of 2012. Ratified the amendment to the tribal-state gaming compact entered into between the State and the Coyote Valley Band of Pomo Indians, executed on July 25, 2012.

AB 1418 (Hall), Chapter 412, Statutes of 2011. Repealed those provisions ratifying the tribal-state gaming compact entered into between the State and Pinoleville Pomo Nation, executed on March 9, 2009, and instead ratified the tribal-state gaming compact entered into between the State and the Pinoleville Pomo Nation, executed on August 8, 2011.

AB 1020 (Chesbro), Chapter 27, Statutes of 2011. Repealed the ratification of the tribal-state gaming compact entered into between the State and the Habematolel Pomo of Upper Lake, executed on September 2, 2009, and instead ratified a new tribal-state gaming compact entered into between the State and the Habematolel Pomo of Upper Lake, executed on March 17, 2011.

SB 89 (Budget and Fiscal Review Committee), Chapter 1, Statutes of 2010. Ratified the tribal-state gaming compact entered into between the State and the Habematolel Pomo of Upper Lake, executed on September 2, 2009.

AB 122 (Coto), Chapter 3, Statutes of 2010. Ratified the tribal-state gaming compact entered into between the State and the Pinoleville Pomo Nation, executed on March 10, 2009.

AB 3072 (Price), Chapter 334, Statutes of 2008. Ratified the first amendment to a tribal-state gaming compact entered into between the State and the Shingle Springs Band of Miwok Indians, executed on June 30, 2008.

SB 106 (Wiggins), Chapter 37, Statutes of 2007. Ratified a new compact between the State and the Yurok Tribe of the Yurok Reservation.

SB 174 (Ducheny), Chapter 38, Statutes of 2007. Ratified the first compact amendment to the compact between the State and Sycuan.

SB 175 (Ducheny), Chapter 39, Statutes of 2007. Ratified the first compact amendment to the compact between the State and Morongo.

SB 903 (Padilla), Chapter 40, Statutes of 2007. Ratified the first compact amendment to the compact between the State and Pechanga.

SB 941 (Padilla), Chapter 226, Statutes of 2007. Ratified the first compact amendment to the compact between the State and San Manuel.

SB 957 (Torlakson), Chapter 41, Statutes of 2007. Ratified the first compact amendment to the compact between the State and Agua Caliente.

SB 470 (Ducheny), Chapter 527, Statutes of 2006. Ratified the first amendment to the compact between the State and the Quechan Tribe of the Fort Yuma Reservation.

SB 1117 (Burton), Chapter 856, Statutes of 2004. Ratified two new and two amended compacts entered into between the State and the following tribes: Coyote Valley Band of Pomo Indians (new compact); Fort Mojave Indian Tribe (new compact); Buena Vista Rancheria of Me-Wuk Indians (amended compact); and, Ewiiaapaayp Band of Kumeyaay Indians (amended compact).

AB 687 (Núñez), Chapter 91, Statutes of 2004. Ratified amendments to five compacts entered into between the State and the following tribes: Pala Band of Mission Indians; Pauma Band of Luiseno Mission Indians of the Pauma and Yuima Reservation; Rumsey Band of Wintun Indians; United Auburn Indian Communities; and, Viejas Group of Kumeyaay Indians.

SB 930 (Burton), Chapter 802, Statutes of 2003. Ratified a compact between the State and the Torres-Martinez Desert Cahuilla Indians.

SB 411 (Ducheny), Chapter 790, Statutes of 2003. Ratified compacts between the State and the La Posta Band of Diegueno Mission Indians and the Santa Ysabel Band of Diegueno Mission Indians in San Diego County.

Proposition 1A, adopted by the people of California on March 7, 2000. Modified the prohibition against casinos and lotteries in the California Constitution to authorize the Governor to negotiate compacts, subject to legislative ratification, for the operation of slot machines, lottery games, and banking and percentage card games by federally recognized Indian tribes on Indian lands in California, in accordance with federal law. Authorized slot machines, lottery games, and banking and percentage card games to be conducted and operated on Indian lands subject to the compacts.

AB 1385 (Battin), Chapter 874, Statutes of 1999. Designated the Governor as the state officer responsible for negotiating and executing compacts between the State and federally recognized Indian tribes located in the State. Also, ratified 57 compacts and created two special funds in the State Treasury (SDF and RSTF), as specified.

SB 287 (Burton), Chapter 409, Statutes of 1998. Ratified 11 compacts negotiated between the State and Indian tribes that permitted class III video gaming devices on tribal lands and established a process for ratifying other compacts.

Analysis Prepared by: Eric Johnson / G.O. / (916) 319-2531 FN: 0004440

 THIRD READING  

Bill No: AB 1282

Author:

:

Vote:

PRIOR VOTES NOT RELEVANT

NOTE: On August 9, 2016, the Senate Committee on Governmental Organization held an informational hearing on the tribal gaming compact entered into between the State of California and the Buena Vista Rancheria of Me-Wuk Indians

SUBJECT:

SOURCE: Author

DIGEST: This bill ratifies the tribal-state gaming compact (Compact) entered into between the State of California and the Buena Vista Rancheria of Me-Wuk Indians (hereafter “Tribe”) executed on June 28, 2016. Additionally, this bill provides that, in deference to tribal sovereignty, certain actions are not deemed projects for purposes of the California Environmental Quality Act (CEQA); and, stipulates, except as expressly provided, that none of the provisions shall be construed to exempt a city, county, or city and county, or the Department of Transportation from CEQA requirements.

ANALYSIS:

Existing law:

1. Provides, under the Indian Gaming Regulatory Act (IGRA), for the negotiation and conclusion of compacts between federally recognized Indian tribes and the State for the purpose of conducting Class III gaming activities on Indian lands within a State as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments.
2. Authorizes expressly a number of tribal-state gaming compacts between the State of California and specified Indian tribes.
3. Authorizes the conduct of Class III gaming activities to the extent such activities are permitted by state law, a gaming compact has been concluded by a federally recognized tribe and the State, and the compact has been approved by the Secretary of the Interior.
4. Limits the operation of Class III gaming activities to Indian lands acquired on or before October 17, 1988. Provides for certain exceptions to conduct gaming activities on Indian lands acquired after October 17, 1988.
5. Defines Indian lands to mean all lands within the limits of any Indian reservation, and any lands title to which is either held in trust by the United States for the benefit of any Indian tribe, or individual, or held by any Indian tribe or individual subject to restriction by the U.S. against alienation and over which an Indian tribe exercises governmental power.
6. Requires the State to negotiate to conclude a compact in good faith with an Indian tribe having jurisdiction over the Indian lands upon which the Class III gaming activity is to be conducted. Provides the U.S. district courts with jurisdiction over any cause of action initiated by a tribal government alleging that the State failed to negotiate in good faith to conclude a compact. Prescribes the remedy, mediation supervised by the courts, if it is found that the State failed to negotiate in good faith to conclude a compact.
7. Authorizes the Governor, under the California Constitution, to negotiate and conclude compacts, subject to ratification by the Legislature.
   

This bill ratifies the Compact entered into between the State of California and the Buena Vista Rancheria of Me-Wuk Indians executed on June 28, 2016, and supersedes the 2004 amended compact between the Tribe and the State of California.

The Tribe’s 2004 amended compact authorizes the Tribe to operate an unlimited number of gaming devices (slot machines) and provides that the State will receive 15% of the net win on those devices up to $200 million and 25% of the net win over $200 million. The 2004 amended compact also grants the Tribe exclusivity against Class III gaming from non-tribal interests within a 63-mile radius of its gaming facility; provides for revenue sharing contributions to non-gaming tribes through the Revenue Sharing Trust Fund (RSTF) for every slot machine that the Tribe operates over 350 devices; and, requires the Tribe to reach agreements with Amador County to mitigate environmental impacts and pay for public services.

Under terms of this Compact, the Tribe is authorized to operate 2,000 gaming devices within the boundaries of the Tribe’s Reservation (Appendix A) in the County of Amador. The Tribe has agreed to pay the State its pro rata share of costs the State incurs for the performance of its duties under this Compact as well as six percent (6%) of its “net win,” to be shared with tribes that are not gaming or that otherwise are not substantially benefiting from gaming.

Additionally, this Compact provides a framework for the sharing of gaming revenue with the County of Amador and other local jurisdictions. Specifically, from its payments to the RSTF or the TNGF, the Tribe may take annual credits of up to sixty percent (60%) for infrastructure improvements that in part benefit county residents, fire, law enforcement, public transit, education, tourism, and other services including investments in renewable energy projects, water treatment or conservation projects and payments to support capital improvements and operating expenses for facilities within California that provide health care services to tribal members and other members of the local community.

Furthermore, this Compact: (1) provides a regulatory framework that respects the role of the tribal gaming agency as the primary regulator while also ensuring that state gaming regulators fulfill their responsibilities; (2) requires the Tribe to conduct its gaming activities pursuant to an internal control system that implements minimum internal controls that are no less stringent than those in federal regulations; (3) requires the Tribe to adopt a Tribal Labor Relations Ordinance, as specified; and, (4) contains provisions to protect the health and safety of patrons, guests, and employees.

Key Components Of The Compact

• Scope of Class III Gaming Authorized. The Tribe is authorized to operate up to 2,000 gaming devices (slot machines), banking or percentage card games, and any devices or games that are authorized under state law to the California State Lottery, provided that the Tribe will not offer such games through use of the Internet unless others in the state not affiliated with or licensed by the California State Lottery are permitted to do so under state and federal law. The Tribe shall not engage in Class III Gaming that is not expressly authorized in the Compact.
• Authorized Gaming Facility. The Tribe may establish and operate not more than one (1) gaming facility and engage in Class III Gaming only on eligible Indian lands held in trust for the Tribe, located within the boundaries of the Tribe’s reservation and trust lands as those boundaries exist as of the execution date of this Compact, as legally described in the Compact (Appendix A).
• Exclusivity. Provides that in the event the exclusive right of Indian tribes to operate Class III gaming in California pursuant to the California Constitution is nullified by the enactment, amendment, or repeal of a state statute or constitutional provision or the conclusive and dispositive judicial construction of a statute or the state Constitution by a California appellate court after the effective date of this Compact, that gaming devices may lawfully be operated by non-Indian entities, the Tribe shall have the right to: (1) terminate this Compact, in which case the Tribe will lose the right to operate Class III gaming authorized by this Compact or (2) continue under this Compact with entitlement to a reduction of the rates specified below following conclusion of negotiations, to provide for (a) compensation to the State for the costs of regulation, as defined; (b) reasonable payments to local governments impacted by tribal government gaming; (c) grants for programs designed to address gambling addiction; and, (d) such assessments as may be permissible at such time under federal law. 
• Payments to the Special Distribution Fund (SDF). The Tribe shall pay to the State, on a pro rata basis, the costs the State incurs for the performance of all its duties under this Compact, as established by the monies appropriated in the annual Budget Act for the performance of their duties under the Class III Gaming Compacts each fiscal year for the California Gambling Control Commission (CGCC), the California Department of Justice (DOJ), the Office of Problem Gambling, the State Controller, and any other agency or agencies responsible for implementation and administration of Class III gaming compacts.  The Tribe’s pro rata share of the State’s costs in any given year this Compact is in effect may not be increased more than 5% per year and shall be calculated using the following equation: “The maximum number of gaming devices operated in the gaming facility for the previous fiscal year as determined by the State Gaming Agency, divided by the maximum number of gaming devices operated by all federally recognized tribes in California pursuant to tribal-state Class III gaming compacts during the previous State fiscal year, multiplied by the Appropriation, equals the Tribe’s pro rata share.”
• Payments to the Revenue Sharing Trust Fund (RSTF) or the Tribal Nation Grant Fund (TNGF). If the Tribe operates more than three hundred fifty (350) gaming devices at any time in a given calendar year, it shall thereafter, including in that calendar year, pay to the CGCC, for deposit into the RSTF or the TNGF, six percent (6%) of its “net win” from the operation of gaming devices in excess of three hundred fifty (350).

“Net Win” is defined as the drop from gaming devices, plus the redemption value of expired tickets, less fills, less payouts, less that portion of the gaming operation’s payments to a third-party wide-area progressive jackpot system provider that is contributed only to the progressive jackpot amount.

• Credits Applied to the RSTF or the TNGF. The State agrees to provide the Tribe with annual credits for up to sixty percent (60%) of the payments otherwise due to be paid into the RSTF or TNGF for the following:

1. Payments to the County of Amador and local jurisdictions operating facilities or providing services within the County for improved fire, law enforcement, public transit, education, tourism, and other services and infrastructure improvements intended to serve off-reservation needs of County residents – such payments shall be subject to approval by the County or local jurisdiction in the County and at least twenty percent (20%) of the annual credits must be utilized for the above stated purposes. Specified annual payments by the Tribe made pursuant to an agreement between the County and the Tribe and approved by arbitration on June 11, 2008 and currently in effect are also eligible credits and will be deemed to have the approval of the County until termination of that agreement or its replacement with an amended or new intergovernmental agreement;
2. Non-gaming related capital investments and economic development projects by the Tribe on tribal trust lands that provide mutual benefits to the Tribe and the State because, for instance, they have particular cultural, social or environmental value, or diversify the sources of revenue for the Tribe’s general fund;
3. Investments in, and any funds paid to the State for water treatment or conservation projects that, in part, serve the gaming facility or any improvements incorporating water conservation or treatment technology on real property owned by the Tribe, or its members and lineal descendants;
4. Investments in, and any funds paid to the State in renewable energy projects that, in part, serve the gaming facility, and in projects that incorporate charging stations for electric or other zero emission vehicles that are available to patrons and employees of the gaming facility;
5. Payments to support capital improvements and operating expenses for facilities within California that provide health care services to tribal members, Indians, and non-Indians; and,
6. Payments for providing general welfare benefits for, among other things, educational, healthcare, cultural, or vocational purposes, to non-enrolled members of the Tribe and other Native Americans in the community.

All excess authorized credits that cannot be applied in any one year because they would exceed the sixty percent (60%) may be applied as an annual credit in all following years that this Compact is in effect, in the same percentages, until completely exhausted.

• Quarterly Contribution Report. At the time each quarterly payment is due, the Tribe shall submit to the State a report, prepared by the chief financial officer of the gaming operation. The report must include: (a) calculation of the maximum number of gaming devices operated each day, (b) the net win calculation, (c) the amount due the SDF, (d) calculation of the amount due to the RSTF/TNGF, and (e) the total amount of the quarterly payment paid to the State.

Additional Compact Elements

• Gaming Ordinance and Regulations. Provides that all gaming activities conducted under this Compact shall, at a minimum, comply with (1) a gaming ordinance duly adopted by the Tribe and approved in accordance with IGRA, (2) all rules, regulations, procedures, specifications, and standards duly adopted by the National Indian Gaming Commission (NIGC), the Tribal Gaming Agency, and the State Gaming Agency, and (3) the provisions of this Compact, as specified.
• Licensing Requirements and Procedures. Provides that all persons in any way connected with the gaming operation or gaming facility who are required to be licensed or to submit to a background investigation under IGRA, and any others required to be licensed under this Compact, including, without limitation, all gaming employees, gaming resource suppliers, financial sources, and any other person having a significant influence over the gaming operation, must be licensed by the Tribal Gaming Agency and cannot have had any determination of suitability denied or revoked by the CGCC. Also, every gaming employee must obtain, and thereafter maintain current, a valid tribal gaming license, as specified.
• Minimum Internal Control Standards (MICS). Requires the Tribe to conduct its gaming activities pursuant to an internal control system that implements MICS that are no less stringent than those contained in the MICS of the federal NIGC standards, as specified. It requires gaming to operate pursuant to a written internal control system that reasonably assures that assets are safeguarded and accountability over assets is maintained; liabilities are properly recorded and contingent liabilities are properly disclosed; financial records are accurate and reliable; transactions are performed in accordance with the Tribal Gaming Agency’s authorization; access to assets is permitted only in accordance with the Tribal Gaming Agency’s approved procedures; recorded accountability for assets is compared with actual assets; and, functions, duties and responsibilities are appropriately segregated and performed by qualified personnel. The Tribe is required to provide the CGCC, upon written request, a copy of the independent certified public accountant agreed-upon procedures report conducted annually for submission to the NIGC pursuant to federal law. This report verifies that the gaming operation is in compliance with the NIGC’s MICS.
• Patron Disputes. Provides that the Tribe (through its Tribal Gaming Agency) must attempt to resolve patron disputes within three days of the play or operation of any game, including refusal to pay to a patron any alleged winnings from any gaming activities. If a patron is dissatisfied with the resolution, the Tribe shall inform the patron in writing within 15 days of the right to resolution of the dispute by the Tribal Gaming Agency. The Tribal Gaming Agency shall conduct an appropriate investigation, provide to the patron a copy of its procedures concerning patron complaints, and render a decision in accordance with industry practice. The decision shall be issued within 60 days of the patron's request. If dissatisfied with the resolution, the patron has the right to seek resolution either in the Tribe’s tribal court system, once a tribal court system is established, or through binding arbitration of the dispute before a retired judge. Any party dissatisfied with the award of the tribal court or JAMS arbitrator may, at the party’s election, invoke the JAMS Optional Arbitration Appeal Procedure. The cost and expense of arbitration shall initially be borne equally by the Tribe and the patron but the JAMS arbitrator shall award to the prevailing party its costs and expenses (but no attorney fees). The Tribe agrees to wave its sovereign immunity in connection with the jurisdiction of the tribal court system or JAMS Streamlined Arbitration and JAMS Optional Arbitration Appeal Procedure and in any action to enforce their judgments or the obligations provided in this section.
• Public and Workplace Liability. Requires the Tribe to obtain and maintain a commercial general liability insurance policy which provides coverage of no less than $10 million. Also, requires the Tribe to adopt a Tort Liability Ordinance containing provisions that are the same as California tort law to govern all claims of bodily injury, personal injury, or property damage arising out of, connected with, or relating to the casino.
• Environmental Protections. Requires the Tribe to prepare a Tribal Environmental Impact Report (TEIR) and negotiate mitigation of any off-reservation impacts prior to initiating the development of a Project for a facility. The Compact provides procedures regarding the (1) Notice of Preparation of Draft TEIR, (2) Notice of Completion of Draft TEIR, and (3) Issuance of Final TEIR. The Tribe’s failure to prepare an adequate TEIR when required may warrant an injunction where appropriate. Before commencement of a Project, and no later than the issuance of the final TEIR, the Tribe shall negotiate an intergovernmental agreement with the California Department of Transportation (Caltrans) if state roads are impacted. A completed TEIR must be filed with the County of Amador, the DOJ, the CGCC, and the State Clearinghouse. Also, before commencement of a Project, and no later than the issuance of the final TEIR, the Tribe shall offer to commence negotiations with the County of Amador to, amongst other things, provide for the timely mitigation of any significant effect on the off-reservation environment including provisions relating to compensation for law enforcement, fire protection, emergency medical services and any other public services, to the extent such services are to be provided by the County to the Tribe as a consequence of the Project.
• Enhanced Audit and Compliance Review Procedure. In addition to providing for an annual independent audit, the Compact allows the state to conduct its own annual audit and compact compliance review.
• Inspection and Testing of Slot Machines. Provides that slot machines will have to be tested, approved and certified by an independent gaming test laboratory or state governmental gaming test laboratory to ensure they are being operated according to specified technical standards. Also, requires the Tribal Gaming Agency to maintain adequate records that demonstrate compliance with software and hardware specifications. The State Gaming Agency would be authorized to annually conduct up to four random inspections of slot machines in operation to confirm that the slot machines are operating in conformance with these standards.
• Compliance Enforcement. Provides that it is the responsibility of the Tribal Gaming Agency to conduct on-site gaming regulation and control in order to enforce the terms of this Compact, IGRA, any applicable NIGC and State Gaming Agency regulations, and the tribal gaming ordinance with respect to gaming operation and facility compliance, and to protect the integrity of the gaming activities, the reputation of the Tribe and the gaming operation for honesty and fairness, and the confidence of patrons that tribal government gaming in California meets the highest standards of regulation and internal controls. To meet those responsibilities, the Tribal Gaming Agency shall adopt and enforce regulations, procedures, and practices.
• Labor Provision. Provides that the gaming activities authorized by this Compact may only commence after the Tribe has adopted an ordinance identical to the Tribal Labor Relations Ordinance (TRLO), referenced as Appendix C of the Compact, and the gaming activities may only continue as long as the Tribe maintains the ordinance. If the Tribe employs 250 or more persons in a tribal casino facility, then the provisions of the TLRO become effective.
• Workers’ Compensation. Provides that the Tribe agrees to participate in the state’s workers’ compensation program with respect to employees at the casino. All disputes arising from the workers’ compensation laws shall be heard by the State Workers’ Compensation Appeals Board pursuant to the California Labor Code. The Tribe acknowledges the jurisdiction of the Board in such manners. In lieu of participation in the State’s system, the Tribe may create and maintain a system through self-insurance, which includes specified provisions, including hearings before an independent tribunal. Furthermore, the Tribe agrees that it will participate in the state’s unemployment compensation program for providing benefits and unemployment compensation disability benefits to employees at the casino. The Tribe shall withhold all taxes due to the state, except for Tribal members living on the Tribe’s reservation, and forward such amounts to the state.
• Prohibitions Regarding Minors. Provides that the Tribe shall prohibit persons under the age of twenty-one (21) years from being present in any room or area in which gaming activities are being conducted unless the person is en route to a non-gaming area of the gaming facility, or is employed at the Gaming Facility in a capacity other than as a gaming employee.
• Alcohol Provisions. Makes it explicit that the purchase, sale, and service of alcoholic beverages shall be subject to state law – the Alcoholic Beverage Control Act.
• Tobacco Provisions. Provides that the Tribe agrees to provide a non-smoking area in the gaming facility and to utilize a ventilation system throughout the gaming facility that exhausts tobacco smoke to the extent reasonably feasible under state-of-the-art technology existing as of the date of the construction or significant renovation of the gaming facility, and further agrees not to offer or sell tobacco products, including but not limited to smokeless tobacco products or e-cigarettes, to anyone younger than the minimum age specified in state law to legally purchase tobacco products.
• Problem Gambling. Requires the gaming operation to establish a program, approved by the Tribal Gaming Agency, to mitigate pathological and problem gaming by implementing specified measures.
• Health and Safety Standards. Provides that the Tribe has agreed to adopt and comply with tribal health standards for food and beverage handling that is no less stringent than State public health standards. Also, the Tribe has agreed to comply with federal water quality and safe drinking water standards applicable in California. The Tribe must also adopt and comply with federal and state laws forbidding harassment, including sexual harassment, discrimination and retaliation. Furthermore, the Tribe must maintain a $3 million insurance policy for these purposes and adopt an ordinance that includes a dispute resolution process.
• Building Codes and Fire Safety. Provides that in order to assure the protection of the health and safety of all gaming facility patrons, guests, and employees, the Tribe shall adopt or has already adopted, and shall maintain throughout the term of this Compact, an ordinance that requires any gaming facility construction to meet or exceed the applicable codes. Gaming facility construction, expansion, improvement, modification or renovation must also comply with the federal Americans with Disabilities Act.
• Emergency Services Accessibility and Possession of Firearms. Requires the Tribe to make reasonable provisions for adequate emergency fire, medical, and related relief and disaster services for patrons and employees. Also, prohibits the possession of firearms by any person in the gaming facility at all times except for federal, state, or local law enforcement personnel, or tribal law enforcement or security personnel, as authorized.
• Effective Date. Provides that this Compact shall not be effective unless and until all of the following have occurred: (a) The Compact is ratified by statute in accordance with state law and (b) Notice of approval or constructive approval is published in the Federal Register. Once effective, this Compact shall be in full force and effect for twenty-five (25) years following the effective date.
• Amendment by Agreement. Provides that the terms and conditions of this Compact may be amended at any time by the mutual and written agreement of both parties, provided that each party voluntarily consents to such negotiations in writing. Any amendments to this Compact shall be deemed to supersede, supplant and extinguish all previous understandings and agreements on the subject.

Brief History of the Buena Vista Rancheria of Me-Wuk Indians

The Tribe is a federally-recognized Indian tribe that occupies a 67.5 acre Indian reservation, the Buena Vista Rancheria.  Me-Wuk Indians have occupied the area known as Buena Vista since at least 1817, and the Tribe has occupied the land constituting the Buena Vista Rancheria from as early as 1905. The Buena Vista Rancheria was purchased in 1927 by the United States and held in trust for the Tribe.  In 1958, Congress adopted the California Rancheria Act, which terminated the federal recognition of several California Indian tribes, including the Buena Vista Me-Wuk Tribe.  The California Rancheria Act also terminated the trust and reservation status of several California Indian Rancherias, including the Buena Vista Rancheria, and, pursuant to distribution plans established under the California Rancheria Act, distributed the Rancheria’s lands in fee to two individual Indians of the Tribe, the great-grandparents of the Tribe’s current Chairperson, Rhonda L. Morningstar Pope. 

In 1979, the Indian residents of the Buena Vista Rancheria joined Indians from 16 other California Rancherias in a class action lawsuit in federal district court against the United States and the various counties in which the Rancherias were located to restore their recognition as Indians and tribes, and to restore the federal Indian reservation status of their lands.  In settlement of that litigation in 1983, the federal district court entered as a stipulated judgment (as agreed to by the plaintiffs, the United States, and the counties) an order (i) restoring to federally-recognized status the involved tribes, including the Buena Vista Me-Wuk Tribe, and (ii) further restoring and confirming the involved individual Indian plaintiffs as Indians, within the meaning of federal law.  In further settlement of that same litigation, in 1987, the federal district court entered as a stipulated judgment an order restoring the boundaries of the Buena Vista Rancheria.

The Tribe originally entered into a compact with the State in 1999 and in 2004, the Tribe negotiated amendments to its compact making it consistent with several others entered into by the Schwarzenegger Administration. Although the Tribe has had compacts with the state since 1999 a casino has not been built on the Tribe’s eligible Indian lands due in part to an ongoing legal dispute with Amador County.

According to information provided by the Tribe, Tribal Chairwoman Rhonda L. Morningstar Pope took office in December of 2004 and over the past 12 years the Tribe has built its governmental infrastructure. The Tribe employs over 15 individuals that perform essential governmental and administrative functions at tribal offices located on the reservation and in Sacramento. The Tribe also operates a nonprofit child development center in Sacramento which serves native and low income families. Additionally, the Tribe oversees an Environmental Department which administers various programs, including cultural resource management, cultural repatriation, solid waste management, and Clean Water Act programs. The Environmental Department has developed and operated a cultural monitoring program for over three years that has been responsible for training over a hundred people to work as monitors for several tribes throughout California. Most importantly, the Tribe has revitalized and restored several vital cultural components on its reservation, including a dance arbor, riggings shacks, a sweat lodge, and an historic cemetery. A new 4,000-square foot cultural center is expected to be completed by the end of 2016.

The Tribe emphasizes that for the past eight years, it has organized and hosted several annual events benefiting children, elders and others in the local and native communities, including: a Memorial Day Event at the Reservation attended by over 800 people; an Elder’s Dinner on Veteran’s Days, serving home-made turkey dinners to local veterans and elders; and a Children’s Christmas Party, attended by hundreds every year, where local children watch Native dance groups and receive an assortment of toys, bikes, and other Christmas gifts. The Tribe routinely collaborates with other tribes and tribal organizations on events and programs serving local and native communities, including the Sacramento Native American Health Center, the Inter-Tribal Council of California, the California Indian Manpower Consortium and the California Rural Indian Health Board.

Pending Litigation

The Tribe has been involved in a legal battle that has gone on for many years against local officials for the right to construct the new casino on its land about five miles south of the town of Ione. The most recent case went to the U.S. District Court for the District of Columbia where, in March 2016, the Court ruled against the County’s assertion that the proposed site for the casino was not a legal reservation for a gambling development. This Compact makes it explicit that the Tribe may only engage in Class III gaming on “eligible” Indian lands located within the boundaries of its reservation. The District Court said yes, the land is eligible – the County of Amador is appealing.

Additional background information

Indian Gaming Regulatory Act (IGRA)

In 1988, Congress enacted the Indian Gaming Regulatory Act (IGRA) to provide a statutory basis for the operation and regulation of gaming on Indian lands. IGRA provides that an Indian tribe may conduct gaming activity on Indian lands if the activity “is not specifically prohibited by federal law and is conducted within a State which does not prohibit such gaming activity.”

IGRA distinguishes between three classes of gaming (Class I, Class II, and Class III) and provides for different forms of regulation for each class. Class I gaming includes “social games” for minor prizes or “traditional forms of Indian gaming.” Class II gaming is defined to include bingo and card games that are explicitly authorized by the laws of the state, or that are not explicitly prohibited by the laws of the state and are played at any location in the State, so long as the card games are played in conformity with those laws and regulations. Class III gaming includes such things as slot machines, casino games and banked card games such as black jack and baccarat. Class III gaming may only be conducted under terms of a compact negotiated between an Indian tribe and a State.

IGRA was enacted against a legal background in which Indian tribes and individuals generally are exempt from state taxation within their own territory. IGRA provides that with the exception of assessments permitted under the statute, to defray the State’s costs of regulating gaming activity, IGRA shall not be interpreted as conferring upon a State authority to impose any tax, fee, charge, or other assessment upon an Indian tribe to engage in Class III activity. Nor may a State refuse to enter into negotiations based on the lack of authority to impose such a tax, fee, charge, or other assessment.

When a tribe requests negotiations for a Class III compact, IGRA requires the State to negotiate with the Indian tribe in good faith. IGRA provides a comprehensive process to prevent an impasse in compact negotiations, which is triggered when a tribe files suit alleging that the State has refused to negotiate or has failed to negotiate in good faith.

Before 2000, the California Constitution prohibited Class III gaming. In 2000, California voters approved Proposition 1A which had been proposed by the Governor and passed by the Legislature. Proposition 1A amended the California Constitution to permit the State to negotiate compacts with federally recognized Indian tribes for certain Class III gaming activities. Because non-Indian parties were still forbidden from operating gaming facilities, Proposition 1A granted Indian tribes a “constitutionally protected monopoly on most types of Class III games in California.”

Rincon Decision

The U.S. Supreme Court in July 2011 refused to consider the decision of the Ninth Circuit Court of Appeals rejecting a Class III Tribal-State Gaming Compact negotiated by then Governor Schwarzenegger with the Rincon Band of Luiseno Mission Indians. The issue of this case's impact on Indian gaming throughout the country has been a topic of great debate.

As noted, IGRA authorizes states to receive compensation for costs related to tribal gaming such as regulation and gaming addiction, and to offset the effects of casinos on surrounding communities. However, states are prohibited from assessing taxes on tribal casino revenues, so unjustified payments to a state's General Fund are no longer permissible unless the tribes are getting something in return for the required payments, such as those authorized by IGRA.

Any payments to the State, above those needed to mitigate impacts of gaming must be in exchange for a benefit deemed "exclusive" to the tribe.

The Rincon Band challenged the legality of California's "second generation" compacts pursuant to which the signatory tribes would be entitled to increase their slot machine count in return for paying percentages of the new slot machine revenue to the state's General Fund. The Ninth Circuit had affirmed a lower court decision that the new financial concessions were nothing more than a state tax on tribal casino revenues which is prohibited by IGRA.

Rincon refused to sign the amended compact which had already been executed by several other tribes choosing instead to demand that it be given the expanded gaming opportunity without making the new financial concessions. The Ninth Circuit Court of Appeals concluded that a “non-negotiable, mandatory payment of 10% of net win into the State treasury for unrestricted use yields public revenue, and is [therefore] a tax, and that the court was therefore required to consider the State’s demand as evidence of bad faith under IGRA’s statutes.”

The court noted that “the State could rebut the presumption of bad faith by demonstrating that the revenue demanded was to be used for the public interest, public safety, criminality, financial integrity, and adverse economic impacts on existing activities, but the State’s need for general tax revenue was insufficient to demonstrate good faith.”

Special Distribution Fund (SDF)

Existing law creates the SDF in the State Treasury for the receipt of revenue contributions made by tribal governments pursuant to the terms of the 1999 model Tribal-State Gaming Compacts and authorizes the Legislature to appropriate money from the SDF for the following purposes: (1) grants for programs designed to address gambling addiction; (2) grants for the support of state and local government agencies impacted by tribal government gaming; (3) compensation for regulatory costs incurred by the CGCC and the DOJ in connection with the implementation and administration of compacts; (4) payment of shortfalls that may occur in the RSTF; (5) disbursements for the purpose of implementing the terms of tribal labor relations ordinances promulgated in accordance with the terms of the 1999 compacts; and, (6) any other purpose specified by law. (Pursuant to compact renegotiations that took place with several of the larger gaming tribes during the Schwarzenegger administration, revenue from those tribes is directed into the state General Fund, instead of the SDF.)

The law establishes a method of calculating the distribution of appropriations from the SDF for grants to local government agencies impacted by tribal gaming. This method includes a requirement that the State Controller, in consultation with the CGCC, deposit funds into County Tribal Casino Accounts and Individual Tribal Casino Accounts based upon a process that takes into consideration whether the county has tribes that pay, or do not pay, into the SDF. The distribution formula "sunsets" on January 1, 2021.

Existing law also establishes an Indian Gaming Local Community Benefit Committee in each county in which gaming is conducted, specifies the composition and responsibilities of that committee, and requires that committee to make the selection of grants from the casino accounts. Among other things, the committee is responsible for establishing all application policies and procedures for grants from the casino accounts. Additionally, existing law requires the State Auditor to conduct an audit every three years and report its findings to the Legislature regarding the allocation and use of SDF grant monies.

Revenue Sharing Trust Fund (RSTF)

Existing law creates in the State Treasury the RSTF for the receipt and deposit of moneys derived from gaming device license fees that are paid into the RSTF pursuant to the terms of specified tribal-state gaming compacts for the purpose of making distributions to non-compacted California tribes (e.g., federally-recognized non-gaming tribes and tribes that operate casinos with fewer than 350 slot machines). Revenue in the RSTF is available to CGCC, upon appropriation by the Legislature, for making distributions of $1.1 million annually to non-compact tribes. The RSTF was created as part of the 1999 compacts, which, in conjunction with the passage of Proposition 1A, created gaming compacts with approximately 60 California tribes. Non-compact tribes are considered third-party beneficiaries of the 1999 compacts.

Tribal Nation Grant Fund (TNGF)

This particular fund (referenced in recent compacts) was created to complement the RSTF and provides for the distribution of funds to non-gaming tribes, upon application of such tribes for purposes related to effective self-governance, self-determined community, and economic development. Payments from this fund are intended to be made to non-gaming tribes on a “need” basis, upon application.

Related/Prior Legislation

AB 795 (Atkins, Chapter 520, Statutes of 2015) ratified the tribal-state gaming compact entered into between the State of California and the Sycuan Band of Kumeyaay Nation, executed on September 2, 2015.

AB 1540 (Gray, Chapter 531, Statutes of 2015) ratified the tribal-state gaming compact entered into between the State of California and the Santa Ynez Band of Chumash Indians, executed on August 26, 2015.

AB 315 (Bigelow, Chapter 512, Statutes of 2015) ratified the amended and restated tribal-state gaming compact entered into between the State of California and the United Auburn Indian Community, executed on August 14, 2015.

AB 475 (Bigelow, Chapter 8, Statutes of 2015) ratified the tribal-state gaming compact entered into between the State of California and Jackson Rancheria Band of Miwuk Indians, executed on February 1, 2015.

SB 1356 (De León, Chapter 314, Statutes of 2014) ratified the amendment to the tribal-state gaming compact entered into between the State of California and the Viejas Band of Kumeyaay Indians, executed on August 12, 2014.

SB 1224 (Correa, Chapter 300, Statutes of 2014) ratified the tribal-state gaming compact entered into between the State of California and the Karuk Tribe, executed on December 4, 2013.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT: (Verified 8/15/16)

Agua Caliente Band of Cahuilla Indians

Barona Band of Mission Indians

Buena Vista Rancheria of Me-Wuk Indians

California Labor Federation

Jamul Indian Village

Pechanga Band of Luiseno Indians

Teamsters

UNITE HERE, AFL-CIO

Yocha Dehe Wintun Nation

Viejas Band of Kumeyaay Indians

OPPOSITION: (Verified 8/15/16)

None received

Prepared by:

8/16/16 12:52:37

**** END ****

 THIRD READING 

Bill No: AB 1282

Author: Gray (D)

Introduced: 2/27/15

Vote: 21

SENATE GOVERNMENTAL ORG. COMMITTEE: 12-0, 6/29/15

AYES: Hall, Berryhill, Block, Gaines, Glazer, Hernandez, Hill, Hueso, Lara, McGuire, Runner, Vidak

NO VOTE RECORDED: Galgiani

ASSEMBLY FLOOR: 78-0, 5/14/15 (Consent) - See last page for vote

SUBJECT: Gambling: Gambling Control Act

SOURCE: Author

DIGEST: This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified.

ANALYSIS:

Existing law:

1. Provides, under the Gambling Control Act (Act), for the licensure of certain individuals and establishments involved in various gambling activities, and for the regulation of those activities by the California Gambling Control Commission (CGCC) and enforcement by the Department of Justice (DOJ).

2. Authorizes the CGCC, for any cause deemed reasonable by the CGCC, to deny any application for a license, permit, or approval, or to impose any fine upon any person licensed or approved.

3. Defines “applicant” as any person who has applied for, or is about to apply for, a state gambling license, or other licenses, permits, or approvals, as specified.

This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified

Background

Purpose of the bill. According to the author, “there have been discrepancies pertaining to what action by the applicant actually commences the licensing process for determining when persons who play a key role in the security, oversight, and in some cases, investigations of card club activities has been triggered for the CGCC or the DOJ to begin their suitability process, as defined in law. AB 1282 would clarify that an applicant is only a person who has applied for a state gambling license, a key employee license, registration, a finding of suitability, a work permit, a manufacturer’s or distributor’s license, or an approval of any act or transaction for which the approval or authorization of the CGGC or DOJ is required or permitted under this chapter.”

Prior/Related Legislation

AB 2526 (Hall, 2012) would have revised several definitions within the Act. Specifically the bill would have revised the definition of a “key employee,” added surveillance managers and supervisors to the definition of “key employee” for licensing purposes and deleted the term “pit boss” and replaced the term “shift boss” to “shift managers.” (Held on the Senate Inactive File)

AB 293 (Mendoza, Chapter 233, Statutes of 2009) allowed limited liability companies (LLCs) and its officers, managers, members, or owners to be eligible for a state gambling license; imposed on all partnerships and LLCs the same licensing requirements that are applicable to limited partnerships and provided that a partnership, instead of being formed under the laws of the state to be eligible for a gambling license must be registered in the state and provide specific supplemental information; and required the CGCC to develop procedures to allow for the continuous operation of licensed gambling establishments in cases including the death or incapacity of a licensee.

FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local: No

SUPPORT: (Verified 8/26/15)

None received

OPPOSITION: (Verified 8/26/15)

None received

ASSEMBLY FLOOR: 78-0, 5/14/15

AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Linder, Medina

Prepared by: Felipe Lopez / G.O. / (916) 651-1530

8/26/15 14:44:39

**** END ****

 THIRD READING 

Bill No: AB 1282

Author: Gray (D)

Introduced: 2/27/15

Vote: 21

SENATE GOVERNMENTAL ORG. COMMITTEE: 12-0, 6/29/15

AYES: Hall, Berryhill, Block, Gaines, Glazer, Hernandez, Hill, Hueso, Lara, McGuire, Runner, Vidak

NO VOTE RECORDED: Galgiani

ASSEMBLY FLOOR: 78-0, 5/14/15 (Consent) - See last page for vote

SUBJECT: Gambling: Gambling Control Act

SOURCE: Author

DIGEST: This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified.

ANALYSIS:

Existing law:

1. Provides, under the Gambling Control Act (Act), for the licensure of certain individuals and establishments involved in various gambling activities, and for the regulation of those activities by the California Gambling Control Commission (CGCC) and enforcement by the Department of Justice (DOJ).

2. Authorizes the CGCC, for any cause deemed reasonable by the CGCC, to deny any application for a license, permit, or approval, or to impose any fine upon any person licensed or approved.

3. Defines “applicant” as any person who has applied for, or is about to apply for, a state gambling license, or other licenses, permits, or approvals, as specified.

This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified

Background

Purpose of the bill. According to the author, “there have been discrepancies pertaining to what action by the applicant actually commences the licensing process for determining when persons who play a key role in the security, oversight, and in some cases, investigations of card club activities has been triggered for the CGCC or the DOJ to begin their suitability process, as defined in law. AB 1282 would clarify that an applicant is only a person who has applied for a state gambling license, a key employee license, registration, a finding of suitability, a work permit, a manufacturer’s or distributor’s license, or an approval of any act or transaction for which the approval or authorization of the CGGC or DOJ is required or permitted under this chapter.”

Prior/Related Legislation

AB 2526 (Hall, 2012) would have revised several definitions within the Act. Specifically the bill would have revised the definition of a “key employee,” added surveillance managers and supervisors to the definition of “key employee” for licensing purposes and deleted the term “pit boss” and replaced the term “shift boss” to “shift managers.” (Held on the Senate Inactive File)

AB 293 (Mendoza, Chapter 233, Statutes of 2009) allowed limited liability companies (LLCs) and its officers, managers, members, or owners to be eligible for a state gambling license; imposed on all partnerships and LLCs the same licensing requirements that are applicable to limited partnerships and provided that a partnership, instead of being formed under the laws of the state to be eligible for a gambling license must be registered in the state and provide specific supplemental information; and required the CGCC to develop procedures to allow for the continuous operation of licensed gambling establishments in cases including the death or incapacity of a licensee.

FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local: No

SUPPORT:

(Verified 6/30/15)

None received

OPPOSITION: (Verified 6/30/15)

None received

ASSEMBLY FLOOR: 78-0, 5/14/15

AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Linder, Medina

Prepared by: Felipe Lopez / G.O. / (916) 651-1530

7/7/15 10:56:34

**** END ****

 CONSENT  

Bill No: AB 1282

Author: Gray (D)

Introduced: 2/27/15

Vote: 21

SENATE GOVERNMENTAL ORG. COMMITTEE: 12-0, 6/29/15

AYES: Hall, Berryhill, Block, Gaines, Glazer, Hernandez, Hill, Hueso, Lara, McGuire, Runner, Vidak

NO VOTE RECORDED: Galgiani

ASSEMBLY FLOOR: 78-0, 5/14/15 (Consent) - See last page for vote

SUBJECT: Gambling: Gambling Control Act

SOURCE: Author

DIGEST: This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified.

ANALYSIS:

Existing law:

1. Provides, under the Gambling Control Act (Act), for the licensure of certain individuals and establishments involved in various gambling activities, and for the regulation of those activities by the California Gambling Control Commission (CGCC) and enforcement by the Department of Justice (DOJ).

2. Authorizes the CGCC, for any cause deemed reasonable by the CGCC, to deny any application for a license, permit, or approval, or to impose any fine upon any person licensed or approved.

3. Defines “applicant” as any person who has applied for, or is about to apply for, a state gambling license, or other licenses, permits, or approvals, as specified.

This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified

Background

Purpose of the bill. According to the author, “there have been discrepancies pertaining to what action by the applicant actually commences the licensing process for determining when persons who play a key role in the security, oversight, and in some cases, investigations of card club activities has been triggered for the CGCC or the DOJ to begin their suitability process, as defined in law. AB 1282 would clarify that an applicant is only a person who has applied for a state gambling license, a key employee license, registration, a finding of suitability, a work permit, a manufacturer’s or distributor’s license, or an approval of any act or transaction for which the approval or authorization of the CGGC or DOJ is required or permitted under this chapter.”

Prior/Related Legislation

AB 2526 (Hall, 2012) would have revised several definitions within the Act. Specifically the bill would have revised the definition of a “key employee,” added surveillance managers and supervisors to the definition of “key employee” for licensing purposes and deleted the term “pit boss” and replaced the term “shift boss” to “shift managers.” (Held on the Senate Inactive File)

AB 293 (Mendoza, Chapter 233, Statutes of 2009) allowed limited liability companies (LLCs) and its officers, managers, members, or owners to be eligible for a state gambling license; imposed on all partnerships and LLCs the same licensing requirements that are applicable to limited partnerships and provided that a partnership, instead of being formed under the laws of the state to be eligible for a gambling license must be registered in the state and provide specific supplemental information; and required the CGCC to develop procedures to allow for the continuous operation of licensed gambling establishments in cases including the death or incapacity of a licensee.

FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local: No

SUPPORT:

(Verified 6/30/15)

None received

OPPOSITION: (Verified 6/30/15)

None received

ASSEMBLY FLOOR: 78-0, 5/14/15

AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Linder, Medina

Prepared by: Felipe Lopez / G.O. / (916) 651-1530

7/1/15 11:15:45

**** END ****

SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION

Senator Isadore Hall, III

Chair

2015 - 2016 Regular

Bill No: AB 1282 Hearing Date: 6/29/2015

SUBJECT: Gambling: Gambling Control Act

DIGEST: This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified.

ANALYSIS:

Existing law:

1. Provides, under the Gambling Control Act (Act), for the licensure of certain individuals and establishments involved in various gambling activities, and for the regulation of those activities by the California Gambling Control Commission (CGCC) and enforcement by the Department of Justice (DOJ).

2. Authorizes the CGCC, for any cause deemed reasonable by the CGCC, to deny any application for a license, permit, or approval, or to impose any fine upon any person licensed or approved.

3. Defines “applicant” as any person who has applied for, or is about to apply for, a state gambling license, or other licenses, permits, or approvals, as specified.

This bill revises the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified

Background

Purpose of the bill. According to the author, “there have been discrepancies pertaining to what action by the applicant actually commences the licensing process for determining when persons who play a key role in the security, oversight, and in some cases, investigations of card club activities has been triggered for the CGCC or the DOJ to begin their suitability process, as defined in law. AB 1282 would clarify that an applicant is only a person who has applied for a state gambling license, a key employee license, registration, a finding of suitability, a work permit, a manufacturer’s or distributor’s license, or an approval of any act or transaction for which the approval or authorization of the CGGC or DOJ is required or permitted under this chapter.”

Gambling Control Act. The Act provides CGCC with jurisdiction over the operation of gambling establishments in California. The Act assigns CGCC the responsibility of assuring that gambling licenses are not issued to, or held by, unqualified or disqualified persons, or by persons whose operations are conducted in a manner that is harmful to the public health, safety, or welfare. The Act directs CGCC to issue licenses only to those persons of good character, honesty and integrity, and whose criminal record, if any, reputation, habits and associations do not pose a threat to the public interest of this state. DOJ conducts background and field investigations and enforces the provisions of the Act.

Prior/Related Legislation

AB 2526 (Hall, 2012) would have revised several definitions within the Act. Specifically the bill would have revised the definition of a “key employee,” added surveillance managers and supervisors to the definition of “key employee” for licensing purposes and deleted the term “pit boss” and replaced the term “shift boss” to “shift managers.” (Held in the inactive file on the Senate Floor)

AB 293 (Mendoza, Chapter 233, Statutes of 2009) allowed limited liability companies (LLCs) and its officers, managers, members, or owners to be eligible for a state gambling license; imposed on all partnerships and LLCs the same licensing requirements that are applicable to limited partnerships and provided that a partnership, instead of being formed under the laws of the state to be eligible for a gambling license must be registered in the state and provide specific supplemental information, and required the CGCC to develop procedures to allow for the continuous operation of licensed gambling establishments in cases including the death or incapacity of a licensee.

SB 1678 (Florez, 2008) would have added to the definition of “license” any other license issued by the CGCC pursuant to the Act or by a regulation adopted pursuant to the Act. The bill was gutted and amended in the Assembly. (Held in Assembly Rules Committee)

AB 730 (Florez, Chapter 438, Statutes of 2007) made various changes to the licensing and regulatory processes related to key employees for gambling establishments under the Act.

AB 1753 (Governmental Organization Committee, Chapter 546, Statutes of 2005) deleted the residency requirement for key employees of California card rooms and revised the penalties for violations of California’s gambling related laws.

SB 8 (Lockyer, Chapter 867, Statutes of 1997) repealed the Gaming Regulation Act and instead enacted the Act.

FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local: No

SUPPORT:

None received

OPPOSITION:

None received

Date of Hearing: May 6, 2015

ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION

Adam Gray, Chair

ABPCA Bill Id:AB 1282

Author:(Gray) – As Introduced Ver:February 27, 2015

SUBJECT: Gambling: Gambling Control Act

SUMMARY: Would revise the definition of “applicant” to no longer include any person who is about to apply for a state gambling license, or other licenses, permits, or approvals, as specified.

EXISTING LAW:

1. The Gambling Control Act establishes a statutory framework for the licensure of certain individuals and establishments involved in various gambling activities and for the regulation of those activities by the California Gambling Control Commission (CGCC or commission), and enforcement by the Department of Justice (DOJ).

2. Authorizes CGCC, for any cause deemed reasonable by the commission, to deny any application for a license, permit, or approval, to limit, condition, or restrict any license, permit, or approval, or to impose any fine upon any person licensed or approved.

3. Defines applicant as any person who has applied for, or is about to apply for, a state gambling license, or other licenses, permits, or approvals, as specified.

FISCAL EFFECT: This bill is keyed non-fiscal by Legislative Counsel.

COMMENTS:

Gambling Control Act: The Act provides CGCC with jurisdiction over the operation of gambling establishments in California. The Act assigns CGCC the responsibility of assuring that gambling licenses are not issued to, or held by, unqualified or disqualified persons, or by persons whose operations are conducted in a manner that is harmful to the public health, safety, or welfare. The Act directs CGCC to issue licenses only to those persons of good character, honesty and integrity, whose prior activities, criminal record, if any; reputation, habits and associations do not pose a threat to the public interest of this state. DOJ conducts background and field investigations and enforces the provisions of the Act in this regard.

Purpose of the bill: There have been discrepancies pertaining to what action by the applicant actually commences the licensing process for determining when persons who play a key role in the security, oversight, and in some cases, investigations of card club activities has been triggered for the CGCC or DOJ to begin their suitability process, as defined in law.

AB 1282 would clarify that an "applicant” is only a person who has applied for a state gambling license, a key employee license, registration, a finding of suitability, a work permit, a manufacturer’s or distributor’s license, or an approval of any act or transaction for which the approval or authorization of the CGCC or DOJ is required or permitted under this chapter.

Prior legislation: AB 293 (Mendoza) Chapter 233, Statutes of 2009. Among other things, allows a limited liability corporation (LLC) and its officers, managers, members, or owners to be eligible for a state gambling license; imposes on all partnerships and LLCs the same licensing requirements that are applicable to limited partnerships and provides that a partnership, instead of being formed under the laws of the state to be eligible for a gambling license must be registered in the state and provide specific supplemental information; and requires the CGCC to develop procedures to allow for the continuous operation of licensed gambling establishments in cases including the death or incapacity of a licensee.

SB 1678 (Florez) 2007-2008 Session. Would have added to the definition of “license” any other license issued by CGCC pursuant to the Act or by a regulation adopted pursuant to that Act. (Held in Assembly Rules Committee)

SB 730 (Florez), Chapter 438, Statutes of 2007. Makes various changes to the licensing and regulatory processes related to key employees for gambling establishments under the Act.

AB 1753 (Governmental Organization Committee) Chapter 546, Statutes of 2005. Deletes the residency requirement for key employees of California card rooms. Revises the penalties for violations of California's gambling related laws.

SB 8 (Lockyer), Chapter 867, Statutes of 1997. Repealed the Gaming Regulation Act, and instead enacted the Gambling Control Act, which provided for DOJ to investigate and enforce controlled gambling in the state. It also established the Commission and empowered it to regulate gambling in this state to issue, suspend, or revoke gambling licenses.

REGISTERED SUPPORT / OPPOSITION:

Support

None on file

Opposition

None on file

Analysis Prepared by: Eric Johnson / G.O. / (916) 319-2531