Gov Appeals Rincon Compact Negotiation Case

Governor Schwarzenegger filed an appeal last Thursday to a San Diego federal judge's decision that found he was negotiating in bad faith with the Rincon Band of Mission Indians.

See post: http://rml-sulumhasscientia.blogspot.com/2008/05/federal-court-decision-state-cant-offer.html

As part of the appeal, lawyers for the Governor said that the judge's order could lead to “an uncontrolled, if not chaotic” expansion of slot machines.

The judge ordered the two sides to reach a deal by the end of next month or he would appoint a mediator to pick between the last offers from each side.

But lawyers for the state said that's unacceptable. They are asking the judge to hold off on enforcing his order until the 9th U.S. Circuit Court of Appeals can rule.

“It would really challenge some of these compacts and how they're supposed to work,” said Jerry Turk, who was the Pala casino's managing partner until recently.

Rincon's lawyer, Scott Crowell, said the tribe will oppose the state's motion to delay the order.

He said the tribe has asked in vain to meet with the governor's negotiators for a deal that would allow its Harrah's Rincon casino to expand beyond the 1,600 slot machines it operates.

Federal judges in Connecticut and Wyoming have rejected requests to put off negotiations while similar “bad faith” findings are appealed, he said.

Tribal Vice Chairman Bo Mazzetti said last week that the tribe wants 2,000 slots that it believes it's entitled to right now, but may ask for more later.

He said tribal leaders are opposed to paying money into the state's general fund, but are willing to spend millions in San Diego County to offset the impact of the casino.

During earlier talks, state negotiators proposed 2,500 slots, but under conditions that, according to an economist, would have resulted in $38 million more for state coffers and an additional $1.7 million for the tribal government.

In 2005, the 650-member tribe kept $61 million of the $250 million gamblers lost at its casino, with the rest going toward payroll, supplies and other expenses. It puts $1.3 million a year into a trust fund for tribes with small or no casinos.

The tribe says it needs more slots for its resort north of Valley Center to be competitive with nearby casinos that have deals for thousands more machines.

But state officials say they don't want to negotiate with Rincon under these conditions.

If the order stands and negotiations are forced, the state could lose even if it wins the appeal, Deputy Attorney General Peter Kaufman said in the motion.

Here, he said, is how:
The state would be in a poor bargaining position in any negotiations before the merits of the appeal are decided because it can't ask for money for the general fund, which is what it most wants.

But if the governor doesn't negotiate, then the court-appointed mediator would pick the tribe's last offer, which, by definition, wouldn't be in the state's best interests.

Then about 60 other tribes working under compacts negotiated by Gov. Gray Davis in 1999, would be able to get similar conditions for more slots.

The result of the judge's decision “virtually guarantees an uncontrolled, if not chaotic, expansion of slot machines throughout California with no resultant benefit to the people of the State,” Kaufman wrote.

That, he said, would result in “irreparable injury” to the state's efforts to raise money for government operations.

In addition to weighing the impact on the state, the judge must consider the possible harm that delaying his order would have on Rincon.

Kaufman argued that's tough to say, because there's no way to know how many slots Rincon would get – or under what terms – if a mediator picks a compact.

Full Article:
http://www.signonsandiego.com/news/metro/20080509-9999-1m9rincon.html