Senate Standing Committee on Governmental Organization

Today we have one Bill and six tribal state compacts and one compact extent compact extension. I want to remind Members and staff that we only have one resolution. I ask the Members make their way to the Committee so we can do the people's business.

As soon as we disperse with the resolution, we'll be adjourning our Bill hearing and moving forward with our compact hearings. With that, let's begin with file item number one. ACR 151, Assemblymember Calderon. Welcome and please feel free to begin one more.

Good morning. Thank you Mister chair and Members. I'm here today to present ACR 151 which seeks to raise awareness and prioritize the use of seismically vetted non structural components within our buildings.

Non structural components can include plumbing, electrical wiring and HVAC systems, all of which are separate from structural building components such as the foundation of a building or load bearing walls. The non structural components within our buildings play a major yet underestimated role in seismic resiliency following an earthquake.

Buildings are often rendered inhospitable due to severe damage to the non structural systems despite minimal damage to the structural components. Given the constant threat of earthquakes in our state. And we had a couple yesterday right by my home.

ACR 151 seeks to raise the importance of seismically vetted non structural technologies from the point of new construction to the functional recovery of a building post earthquake. Here with me in support is Richard McCarthy, President of the Earthquake Engineering Research Institute, Northern California Division, and Tom Sheehy on behalf of the Pipe manufacturing company Omegaflex.

Oh, perfect. Thank you.

Okay. Good morning. Good morning Mister Chairman, Members, thank you for hearing me this morning. To build on what the Assembly Member has said to you, the nonstructural components of buildings are kind of an underestimated liability. Those components can knock you out and get you red tagged or yellow tagged and affects your building's functionality.

So what we need is your assistance here is to identify those companies and entities have gone the extra mile to seismically test their components.

And as an example, final point is we have a large seismic test in UC San Diego, 10 story building steel moment frame full of non structural components and we'll be shaking those that entity and doing post earthquake fire tests as well.

So these are sophisticated tests and it's up to us to try and recognize those companies by allowing potential building owners and contractors to identify and use those components. They don't cost any more than any other component, so it improves the functionality and shall we say, resiliency of the building. So thank you.

Thank you very much. We're going to pause at this point and do a quorum call. Secretary, please call the roll.

[Roll Call]

Perfect. We have a quorum. Please proceed.

Great. Thank you. Chairman Dodd and Members of the Geo Committee really appreciate the opportunity to have a few words here in support of Miss Calderon's resolution. California is earthquake country. There's no question about it. We've had several earthquakes over 4.0 on the Richter scale just in the last 10 days.

And most earthquake regulations and building code requirements focus on the structural aspect of buildings. Miss Calderon's resolution focuses on the non structural part. And when we talk about non structural, we're talking about things like elevators, stairwells, h vac systems, electrical systems and piping systems.

These are critical because if a building is left intact standing after an earthquake and their water pipes break and flood the building, it becomes unusable, just as an example of how a non structural system can cause havoc in a building. So having a focus on the non structural elements of seismic safety is a really, really important matter.

ACR 151 addresses this critical infrastructure and the benefits that it can bring by trying to jumpstart more work in this area with non structural systems. Seismic codes and standards do exist that will facilitate the use of more resilient building components. But we need to have more incentives in order to get engineers to take these up.

And we're hoping that ACR 151 will send a message to the building community and to engineers and to building designers to use more of these materials. Changes in building standards are happening across the country, and so we think this is a really good opportunity to send a message to the building code community, such as it is.

There are no California specific costs to this measure. We don't believe that it will make buildings more expensive to build or maintain. In fact, we think in the long run, over the lifecycle of a building having more resilient components, and it will actually save costs.

This is a small step, but we think an important step in the direction of more seismic resiliency and functional recovery. And we would appreciate your support this morning and your aye vote on Miss Calderon's resolution. Thank you very much.

Thank you. Anyone else here in support? Anyone here in opposition will bring it back to the Committee. We have a motion by Senator Wilk, I do like to say I really appreciate this. In 2013, I was a Napa County supervisor after the earthquakes in Napa.

And my wife and I, about 05:00 in the morning, walked up the county building, the stairs, because obviously the elevators were not working. And what was really evident to us is there was no structural damage in this big building at all.

But what was happening is all the piping was broken, water spraying out on the stairs, going up the HVC systems, all the things hanging there. So I do think this is a serious issue issue. And much damage was done to that building by water and other elements.

And if we had a good infrastructure there, there would have been a lot less damage to have to pay for it later. So thank you for bringing this forward. We have a motion by Senator Wilk. The motion is that the resolution be adopted. Secretary, police call. Excuse me, would you like to close?

Yes, thank you. Yes, I appreciate that. Mister Chair, respectfully ask for an aye vote.

Thank you very much, Assembly Member. So, secretary, please call the roll.

[Roll Call]

Smallwood-Cuevas has 10 votes. We'll hold the roll. We're gonna close the roll. The roll is now closed. Thank you very much.

Thank you, Mister chair.

Terrific. So we're adjourning our Bill hearing, and we're gonna move on to the informational hearings. Once again, good morning. I'm Senator Dodd, Chairman of the Senate Governmental Organization Committee. Today we'll be holding informational hearings on one tribal compact extension as well as six tribal state compacts.

We'll begin with the tribal compact extension, followed in alphabetical order by six tribal state gaming compacts listed on the agenda. For those of you unfamiliar with the sentence procedure, the established policy allows for informational hearing on the details. The compact to be followed by a vote on the Senate Floor. No vote will be taken here today.

As an example, the Bill ratifying the Campo Elam Indian colony, LA Posta Timbicia compacts will be SB 931 by yours truly. Assuming everything goes smoothly, SB 931 will soon be amended with ratifying language for all four of those compacts taken up by the Assembly floor.

Once that Bill comes to the Senate, the Bill will be referred straight to the Senate Floor for a vote with the full Senate body. With that, let's begin our informational hearing on the Augustine extension. Augustine extension. Excuse me.

I want to take this opportunity to welcome Matthew Lee to his first presentation on tribal compacts and congratulate him for this appointment as senior advisor for tribal negotiations for Governor Newsom. Mister Lee, please feel free to begin.

Well, thank you very much. Chair. Good morning. Good morning, honorable Members. Thank you very much for having me here this morning. It's a pleasure to be here. And of course, I'd like to wish a very warm good morning to the representatives of tribal governments and other Members of the public who have also joined us.

First, perhaps just a little bit of table setting that might help us through all of these items. I know that what I am about to say is not news to this Committee, but for those of you who are following along at home, it might be helpful to know the basic framework here.

The starting point for relations between the state government and tribal governments is that both are, in fact, their own sovereign governments. Neither has, as a General matter, any inherent power to regulate the other, but both do relate to each other on a government to government basis.

There is, without sort of belaboring the finer point of the relevant federal law here. There is a specific federal statute that provides a framework for the state government and tribal governments to structure their relationships in the specific context of tribal gaming. It's called the Indian Gaming Regulatory act.

And what that federal statute says is that the state government and tribal governments can come together and work to negotiate about certain topics that are somehow related to gaming so that the tribe can pursue the economic development and self sufficiency that gaming provides, and the state can manage the potential adverse impacts and other externalities that may be flowing from tribal gaming.

So that's the basic foundation for all of the compacts that you are going to hear about this morning.

These are compacts where the governor's office and its partners representing the state have worked to negotiate for certain priorities that we believe are important to protect legitimate state interests, things like the protection of workers in tribal casinos and so on.

And of course, the tribe has done its best to strike a deal that will maximize its opportunity for economic development. So I'll say more about all of those details as we discuss each compact for purposes of the Augustine extension.

Just want to flag that this is in a different posture than the other compacts you will hear this morning.

What we have here is a situation where if the tribe and the state are unable to reach a deal under the framework I just described, one of the things that can happen is that they can wind up in litigation, and there is a complicated procedure that that process can follow.

But the short version is that that is what has happened in the context of Augustine. Both parties have gotten a ruling from a federal district court that favored one side on some issues and favored the other side on some other issues. We are now both engaged in a mandatory process of further negotiations that follows that ruling.

And of course, both sides could be considering other legal options as well.

The short version is that because that process is continuing, and because we are dealing with a tribal government that has an existing gaming compact and an existing gaming operation in place, from our perspective, it makes sense to simply preserve the status quo by extending that existing compact while the ongoing legal process that I just described continues.

So that's what this extension would do today.

Thank you very much. Mister Lee, are there any questions for Members? Okay, I just have one. I understand there's possibility that other extensions might be getting done this session. Do you have an update on those and when they potentially may be finalized?

Yes, absolutely. And thank you very much both for your patience and for asking about that. My understanding is that the last two that the. That I have been tracking should be delivered today. That's the Trinidad rancheria up in Humboldt County, and the Picayune rancheria of the Chukchansi down in Coarsegold.

I don't anticipate further extensions at this time, but of course, we'll be in touch with staff as the situation develops. Perfect. Thank you very much.

Now we'll move on to the Chairwoman from Augustine, who I believe is on Zoom. Chairman, are you there? Chairwoman, are you there? Excuse me. There you are. Good morning.

Good morning. I am the chairperson for the Timbisha Shoshone tribe.

Well, we'll be visiting with you momentarily. We're looking for the Chairwoman from Augustine.

I don't do too anymore. She does.

And now a word from our sponsor. Yeah, what's that? Okay, we'll move on. Sure. She had a lot to say, but are there any questions? I don't think there could be any questions. We haven't heard anything from them, so we'll move on. Anyone wanting to provide public comment here in the room? Seeing none.

That concludes our informational hearing on the Augustine compact extension. We'll now move to the big Sandy compact. Mister Lee, please feel free to begin.

Thank you very much. On this compact. This is a new substantive compact for a tribe down in, I believe, Fresno County, and gives me an opportunity to introduce some of the key terms that are at issue whenever we as a state work to negotiate these compacts.

Of course, some of the key terms are relatively fundamental to the whole project of operating a gaming operation. How many machines, how many facilities. In this case, it's a cap of 3000 gaming devices, things like slot machines, at no more than two facilities.

Some of the other key terms that tend to come up in all of these negotiations concern what you might think of as the economic realities of the gaming operation and its regulation in two key respects. There is something called the special Distribution Fund. These are payments that tribal gaming operations make to the state.

They are intended to cover the state regulatory costs. There is a special formula that the state has, over many years, worked out to help define what those costs are and how they can be covered.

That's the same formula that we're using here in Big Sandy, except that while Big Sandy remains what's called a limited gaming tribe under 350 devices, they can pay using an older formula under their pre existing 1999 compact.

Don't see that as a significant difference, but it is something that, from the state's perspective, but it is something that the tribe did negotiate for. There's a separate bucket of economic terms. There's a separate set of payments called the Revenue Sharing Trust Fund, or the RSTF, and the tribal Nation Grant Fund, or TNGF.

These are payments that are administered by the state. I don't think it's quite right to think of them as payments to the state. These are payments that the state administers on behalf of other tribal nations.

Part of the goal of the entire tribal gaming framework here, and the federal law underlying it, is that tribal gaming is meant to support economic development, not just for a handful of specific tribes, but for tribal governments in General.

And so, one of the ways in which, for decades now, the state and tribal governments have sought to work together to make that happen, to make sure that the benefits of tribal gaming flow to a large number of tribal governments across across the board, is by administering these two funds, which, in the simplest version, provide for grant payments to non gaming and limited gaming tribes.

The RSTF terms in the Big Sandy compact are within the realm of what this body has probably seen before. They pay nothing below 1200 devices, and then there's a scaled series of RSTF contributions above that 1200 device threshold.

They will also pay 1% of net when to mitigate local impacts, the potential local regulatory costs, and other potential local negative externalities of running a gaming operation. If they expand beyond that 350 device threshold I mentioned earlier, they will pay into a local impact mitigation Fund to help defray those without belaboring the point.

They are required to carry insurance to protect casino patrons in the event of an incident, you know, harming a casino patron, you know, General tort liability, things like that. Happy to say more about that if it's helpful. They are also required to carry employment specific insurance to protect workers.

Their workers are also protected by a range of now standard compact terms protecting casino workers in this context, things like state minimum wage and so on.

There is also what's called a tribal labor relations ordinance, which, for gaming operations over a certain threshold, typically about 250 employees, provides a structure and a framework to facilitate the representation by a labor union of those casino employees. So further framework for worker protections there.

Happy to say more about any of those terms or anything else in the compact, but those are what I see as the sort of key terms of this compact.

Thank you very much. Any questions or comments? Seeing none. Thank you, Mister Lee. I am going to move now to Chairwoman Kip, who I believe is on Zoom.

Yes, good morning.

Good morning, Chairwoman.

Good morning. My name is Elizabeth Kipp. I'm the chairperson of Big Sandy Rancheria of Western Mono Indians. I want to thank you for the opportunity to testify today regarding our tribal state gaming compact with the State of California and the legislation AB 2032 introduced by Assemblyman Patterson. Ratify this contact as Senator Shannon Grove is the principal cook office.

Big Sandy Rancheria is headquartered in Hawbury, California. Our trust lands include the Big Sandy Ranch area and additional marshalls east of Fresno. Our tribe has a rich history in California's central region. Traditionally inhabiting the Sierra Nevada areas, we have a strong cultural heritage known for our basketry skills at hunter gathering livestock.

Today, we are committed to preserving our language, culture and traditions while pursuing economic venues, including gaming and inter tribal commerce. This compact signifies a pitiful moment for our tribe and brings with it the promise of benefits to our tribal Members and the surrounding community.

The compact includes provisions that directly benefit our tribal Members by ensuring the sustainability and growth of our economic ventures. As a long term compact of 25 years, we will have the stability for strategic planning and investments, our education, health care, government services and infrastructure projects. Additionally, our tribe enjoys strong support for Fresno county and the sheriff's office.

We have enjoyed a collaborative effort in ensuring community safety and addressing shared concerns with local government leaders. For this reason, I'd like to emphasize that under this compact, we have established an impact mitigation Fund, which has dedicated to supporting local law enforcement emergency services in neighboring jurisdictions.

This Fund ensures that neighboring jurisdictions have the necessary resources to address any impacts arising from our gaming facilities. The ratification of our gaming compact through AB 2032 is vital for the continued growth and prosperity of the Big Sandy rancheria.

This compact not only facilitates economic development, but also ensures that we can address the needs of our community and neighboring jurisdictions effectively. Thank you for considering my testimony and for your support of AB 23.

Thank you very much, chair thank you very much Chairwoman Kipp. Appreciate that. Any questions from any Members here? Seeing none. Appreciate your time this morning. That concludes our info hearing on the Big Sandy compact. We'll now move to the compo compact. Mister Lee, please feel free to begin.

Thank you very much. On the compo compact, this is a 1200 device compact. So somewhat smaller than Big Sandy. Same special distribution Fund pro rata formula. That's the state's regulatory costs. If the tribe remains where it is now in terms of being what's called a limited gaming tribe.

That's under that 350 device threshold I mentioned earlier, it is eligible to have that SDF contribution reduced or eliminated as long, of course, is there is sufficient money in the special distribution Fund to cover that because it is a compact that caps out at 1200 devices, which is the sort of usual threshold for payments into the revenue sharing trust Fund I mentioned earlier, the Fund that consists of payments to other non gaming and limited gaming tribes.

We don't need to worry about the RSTF in the context of this compact because of that 1200 device cap.

It has similar employee protections, some additional employee protections here based on California law to provide for the protection of off reservation employees, similar insurance thresholds, similar torts language, and of course it maintains the tribal labor relations ordinance I mentioned earlier. Those are the highlights. Happy to go into any of that in further detail.

Thank you very much. Mister Lee, any questions? Seeing none, we will now move to anyone wanting to provide public comments on this compact. Seeing nobody coming forward. That concludes our info hearing on the compo band compact. We'll now move to the Elam Indian colony compact.

Mister Lee, feel free to begin. Thank you very much. An even smaller compact this time. This one is up in the south Clear Lake region caps out at 349 gaming devices. So that ties into that 3350 device threshold I've mentioned a couple times.

The gist of that is that this tribe will always be what's called a limited gaming tribe. That, of course makes things significantly simpler from the perspective of working out the details of this compact.

Don't need to worry about RSTF, and because its operations are so limited, don't even need to worry about the kinds of local mitigation efforts that typically kick in above 350 devices. The tribe, of course, could still be subject to payments into the state special distribution Fund to make sure that the state is covering its own regulatory costs.

And of course, there are still patron, you know, tort based protections, including insurance, employee protections, including insurance, and also including TLRO. Great. Thank you very much.

Any questions? Seeing none, we want to move to anyone wanting to provide public comment on this compact. We have somebody coming forward.

Good morning, Mister Chairman, Members of the Committee. My name is Jack Duran. I serve as a General counsel to the Elam Indian colony. And thank you for the correct pronunciation, being right over the hill in Napa County from the tribe.

You've probably been able to say that a couple of times, but thank you very much for considering this compact and taking a look at it. It's going to provide the tribe the opportunity to have some economic development. Development.

The Elam are one of the oldest tribes in the area, and some of their lands have settlements that date back to 14,000 years. Really good people. They have an excellent relationship with their community.

They participate in the Lake County Medical Consortium with six other tribes, and this is actually the last tribe that would have a gaining facility or gaming opportunities in Lake County. So thank you again for your consideration. This is on behalf of Chairman Augustine Garcia and the Elam Executive Committee. Thank you. Thank you very much.

Greetings to the Chairman. Please, on my behalf. I did represent you in the State Assembly from 2014 to 2016. So, having heard all the public, public testimonies, Members, are there any final questions on this compact? Seeing none, that concludes our information hearing on the Elm Indian colony compact. We will now move to the La Posta compact.

Mister Lee, feel free to begin.

Thank you very much. This compact is for a tribe that had a previous compact and I believe had been gaming, is currently not gaming, but is looking to replace its compact in anticipation of potential gaming activity in the future. The framework that this compact would provide for that gaming activity is comparable to compo in terms of size.

We're talking about a 1200 device compact here. In this case, it would be 1200 devices across a maximum of three facilities. If we did see the tribe exceed that 350 device threshold, that is our sort of benchmark for local, the potential mitigation of local impacts. Then we would see the tribe pay into a local mitigation Fund.

Could include things like local fire protection districts and other local emergency services. That would be, I believe, 0.5% of Netwan. Because it's a 1200 device cap, there are no RSGF contributions. Here.

There's the standard SDF, that's the state special distribution Fund, pro rata formula, standard employee and tort liability insurance requirements, other standard employee protections, including the tribal labor relations ordinance.

Thank you, Mister Lee. I'm not seeing any questions or comments from our Members of the Committee. I will now move to Vice Chairman Hill, who I believe is here in the room. Vice Chairman, welcome and feel free to begin when you're ready.

Good morning. Good morning, Vice Chairman for La Posta. I was involved in the original compaq in 2003, and you don't look a day older. Anyways, just here to preserve our right to game the future said earlier the week closed down in 2012.

Hopefully things will change and we've had appreciate the negotiation process that you guys have provided here, so hopefully we can get this back in line.

Could you help us, like exactly where you're located? And then do you have plans to build a casino there?

So we are 62 miles east from San Diego, actually right across the freeway from Campo. And right now we have currently no plans to open the casino there. That's closed down, is just still sitting. So hopefully something will change as we go down the line for the future generations.

Fantastic, Mister Vice Chairman. Thank you. Is there anybody wishing to ask any questions? Seeing none. Appreciate your time here. Now we'll move to anyone wanting to provide public comments on this compact. Seeing none, we'll now that concludes our hearing on the La Posta compact. We'll now move to the Tambicia compact. Mister Lee, feel free to begin.

Thank you very much. This compact is actually substantively identical to the La Posta compact that was just discussed. It would make it a little bit easier on everyone to take these two together. This is another tribe that is not currently gaming. It recently had land taken into trust for gaming purposes near Ridgecrest.

In addition to its initial reservation in the Death Valley region, the compact would allow for gaming on that ridgecrest park parcel, and in theory, also in Death Valley Junction.

Although as far as I'm aware, the tribe has no plans at this time for gaming there substantive terms completely identical to the compact we just discussed, but happy to unpack those further or answer any questions.

Thank you very much. I see no questions from Members. I believe the Chairwoman Cortese may be on the zoom line. Can we check and see, please?

Good morning. I would just like to thank you. Guys. And the Governor, and the Attorney General, and Mark Lee, Matthew Lee. And I'm a little nervous. Noel Fisher and the governmental organization consultant, Mister Lopez.

And by getting this compact done, we will bring economic to development to our tribe so that we will be able to better support our people and also the community that's down there. And so your vote for, for SB 931 is something we would really appreciate. Thank you.

Thank you very much. Chairwoman, congratulations on the compact. We will now move to anyone wanting to provide public comment, seeing nobody come forward. That concludes our hearing on the Tabecia compact. We will now move to our final info hearing, the Tule river compact.

Mister Lee, feel free to begin, please. Thank you very much, Mister Chairman. This compact is actually more limited than it might first seem. This is actually an update to a compact that was negotiated back in 2020.

What we did here was we amended and restated the compact, which is a fancy way of saying we copied and pasted the entire thing, even those parts of it, that we weren't changing. So it looks more, more extensive than it really is.

The changes to this compact compared to the 2020 compact are actually quite limited, and they are, for better or for worse, basically compelled by law. I said at the top of the hour that there is a federal statute here, the Indian Gaming Regulatory act, that provides a structured framework for these compacts. There is.

The short version is that there is a list of particular topics that the state and the tribe are allowed to bargain over.

There's been some recent case law, a case that the 9th Circuit Court of Appeals decided after the 2020 compact with Thule river that has significantly restricted the state's ability to bargain over certain topics that it used to include in its compact negotiations.

In particular, this update does three things to bring this compact into line with the State of the Law as it's been articulated by the 9th Circuit. First, it deletes two provisions that the 9th Circuit has said the state cannot maintain, cannot continue to negotiate for.

Consistent with IGRA, our compacts have historically required tribal court enforcement of certain family law orders, and our compacts have also required tribes to adopt very broad tort liability protections based on California law.

This updated compact eliminates the family law provision simply because the 9th Circuit has said that we can't do that, and it does not eliminate the tort provision, but it significantly narrows it in a way that is more tailored to actual patrons of the gaming facility and therefore more tethered to that gaming activity in a way that we hope and expect will be more likely to survive further legal scrutiny in the future.

The other thing this compact does, the other main thing this compact does is the 9th Circuit has said that we cannot broad environmental review requirements onto tribal governments. So rather than do that, this compact tries to manage the potential off reservation impacts of a gaming operation in a different way.

This compact is in many ways one of the models for the impact mitigation Fund that I have mentioned a few times this morning.

And so if the tribe were to operate more than 350 gaming devices, then it will distribute 0.5% of its net when to local governments and also to impacted local charitable organizations as an alternative way to address those potential offsite impacts.

So, relatively limited changes in a context where legally, our hands are largely tied by the 9th Circuit, but we are still doing what we can to come up with more tailored, more targeted strategies to address the state's legitimate interests related to the potential negative externalities of gaming activity within that framework.

Thank you, Mister Lee. Seeing no questions or comments from our Members, we'll now move to Vice Chairman Nieto, who is here in person, I believe. Morning, Mister Vice Chairman. Please feel free to begin.

And I just want to thank you guys for hearing us out, you know. Thank you for being here, sir, Dodd, and the rest of you, I just want to let you guys know that, you know, with this game in compact, we, we have a lot of jobs offered in Tulare County.

It's one of the poorest counties in America. So, you know, we got like 964 workers at our casino that count on us every day. And then the money that we do have, we created more jobs on our reservation to sustain ourselves, to make people go to work.

So a lot of our money don't go towards our people, towards per capita. It goes towards making our people stand up and get jobs and do a lot of things. So, you know, we also been given to the local communities all throughout Tulare county and then some.

We also support people like our great bro Fong that left you guys to go to DC. So we do a lot of things with our revenue that most don't. So I just want to thank you guys for listening to us from Tule River and letting us know that you guys are here.

You know, not trying to push too much on us, but we give a lot of things that most people don't give. So, you know, we just want to keep moving and have things for our future generations to come. Thank you, Mister Vice Chairman.

Appreciate you being here today. Thank you, guys. Thank you. Yes, have a good day. We'll now move on to anyone wanting to provide public comment, seeing none. That concludes our info hearing on the Tule river compact.

I want to thank Mister Lee for his help on these compacts and, of course, to all the witnesses who testified here today. With that, the Senate Committee on Governmental Organization is now adjourned.