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Best of Howard Stutz

Gaming Guru

Howard Stutz

California Casino Proposal Rejected

30 June 2006

CALIFORNIA – A California legislative committee late Wednesday dealt a blow to the prospects of side-by-side tribal casinos opening in Barstow, but proponents of the venture some 120 miles from the Nevada border aren't ready to fold.

The Assembly Governmental Organizational Committee, after a daylong hearing in Sacramento, rejected a bid by two Indian tribes to operate twin casinos near Barstow's outlet malls off Interstate 15.

The tribes, one from San Diego County and one from Humboldt County, have signed compacts with Gov. Arnold Schwarzenegger, but deals need to be ratified by both California state houses.

"We're disappointed, but the fight is far from over. We look at this as a temporary setback," said Jason Barnett, a spokesman for the Big Lagoon Rancheria tribe. "We're reviewing our legal options, but we have every intention of taking this back and seeking some sort of compromise. We believe this is the best deal for the state, for the city of Barstow and for the tribes."

Under a plan unveiled last year, the Los Coyotes Band of Cahuilla and Cupeno Indians from San Diego and the Big Lagoon tribe of Humboldt would build twin casinos on 47 acres in Barstow.

Compacts were signed in September that would allow the state to collect one-quarter of the profits earned by the casinos. The tribes would be allowed to have up to 2,250 slot machines each with table games.

Barstow officials said the twin casinos are expected to provide 3,700 jobs and add at least $175 million annually to the local economy.

"This is not a death knell for the project and we'll continue to move forward," said John Rader, public information officer for the city of Barstow. "The city leaders who attended the hearing were not surprised given the difficulty in the process. If off-reservation casinos were easy to get approved, they would be everywhere."

The estimated $160 million joint venture is controversial because it would give two Indian tribes without any ties to the Barstow area land for a casino. The move, which has been dubbed "reservation shopping" by critics, has happened throughout the United States because it allows Indian tribes without land the same opportunities for economic development as tribes with large reservations.

A third tribe, which also wants to put a casino in Barstow, opposed the issue in front of the legislative panel. The Chemehuevi Band, based in Lake Havasu near the California-Arizona border, has historical ties to land in Barstow.

In a statement, the Chemehuevi tribe said it was supportive of the legislative committee's actions.

Several Indian tribes with large casinos in Southern California testified against the twin-casino proposal. Richard Milanovich, chairman of the Agua Caliente Band of Cahuilla Indians, which has two casinos in the Coachella Valley, said the deal could set a bad precedent because neither tribe has an ancestral claim to the land.

He also objected to the language in the compacts.

Barstow leaders testified the two-casino proposal would be an economic lifeline and representatives from the Big Lagoon and Los Coyotes tribes said the Barstow deal would help lift them out of poverty.

"About 30 percent of Barstow residents receive some sort of government assistance," Rader said. "We believe we'll eventually be able to overcome the opposition from the wealthy gaming tribes."

The Big Lagoon tribe's Northern California reservation is considered environmentally sensitive by the state. Los Coyotes struck an agreement for the casino site in Barstow because the tribe's land in far northeastern San Diego County cannot be developed.

Schwarzenegger's gaming negotiators proposed the unusual partnership to Barstow and Los Coyotes as a way to end a long-running lawsuit between the state and Big Lagoon.

"The governor feels that he negotiated compacts that were a benefit to the tribes, the state and local communities," Schwarzenegger spokesman Darrel Ng told the Riverside Press-Enterprise. "Should the tribes request it, he will comply with federal regulations and negotiate with them in good faith and he always has."