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Audit into California Gambling Regulatory Agency Gets Support

11 December 2002

SACRAMENTO, California – (Press Release) -- A demand by California tribal governments for a legislative audit and investigation into the activities of a state regulatory agency for tribal casinos will get the support of the state legislature, several influential state lawmakers said Wednesday.

Tribal governments are demanding a legislative investigation into the actions of the California Gambling Control Commission, which tribal leaders believe has been exceeding its regulatory authority under tribal-state compacts agreed to in 1999. The investigation is to include an audit of the Revenue Sharing Trust Fund account, which was established so gaming tribes could share revenues with non-gaming tribes and those with limited gaming.

The California Nations Indian Gaming Association, meeting last week in Alpine, for the second time in three months demanded an audit of the revenue sharing fund and an investigation of the commission. CNIGA, which is comprised of California gaming and non-gaming tribes, is the state's largest organization of tribal governments.

Tribes believe the commission has been promulgating regulations and infringing on tribal authorities in violation of tribal-state compacts and the Indian Gaming Regulatory Act, which gives tribes primacy in regulating gaming on their own lands.

"I'm confident the state legislature will fully scrutinize the actions of the commission," said Sen. Jim Battin, R-La Quinta. "It's clear to me and the tribes that the commission has been exceeding its regulatory reach."

Assemblyman Tony Strickland, R-Thousand Oaks, said he's in "full support of CNIGA's call for a legislative audit and investigation." The vice chair of the Assembly Governmental Organization Committee said he will "vigorously pursue the matter."

Payments from the revenue sharing fund have been delayed for several months and the gambling control commission's own documents show tribes that presumably would not be eligible to receive money from the fund have gotten checks amounting to several hundred thousand dollars.

"This issue not only has to do with the delays in disbursements, but the manner in which they are being disbursed," said CNIGA chairwoman Brenda Soulliere. "This state administrative body has a trust and fiduciary duty to act in the best interests of the intended beneficiaries of the fund and we believe they should be held accountable."

More than $57 million has been paid into the account for distribution to non-gaming tribes and those with very limited gaming. The revenues are generated through license fees and quarterly payments.

Tribes also are committed under the compacts to pay more than $1 billion over the next 18 years into a second, Special Distribution Fund. The fund was established to fund problem gambling programs, reimburse cities and counties for the impact of tribal gaming and help the state pay for regulatory costs. Money from the fund may also be used to make up for shortfalls in the revenue sharing fund. A legislative appropriations bill has not be submitted outlining exactly how the money will be spent.

Tribal governments are not required by federal law to share revenue with local and state governments. But tribal leaders agreed during compact negotiations to contribute to the fund as a good faith attempt to continue their practice of helping communities surrounding tribal reservations and rancherias.

Assemblyman Ed Chavez, D-West Covina, said he wants to make certain the commission has no role in collecting or distributing special distribution fund money.

"I don't want to see the same problems we're having with the revenue sharing fund repeated when the legislature gets around to appropriating Special Distribution Fund money," Chavez said.

In a separate motion, CNIGA voted to oppose any legislation that would prohibit the Secretary of the Interior's approval of agreements between a federally recognized Indian tribe and an inter-tribal consortium of federally recognized Indian tribes as it is an infringement of tribal sovereignty.

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