Philadelphia Slot Machine Distributors Given the Go to Operate Statewide

Schwarzenegger rejected a proposed compromise from Sycuan, Barona and four other tribes, warning he would seek a court order to revoke their gambling compacts unless they remove the machines in question or tally them as the state insists. This is from a letter this month from his top lawyer.

Michael Lombardi, gaming commissioner for Riverside County’s Augustine tribe said, “Why would the governor meet with you and two weeks later stick a dagger in your chest?” one of many that have clashed with the state in the slot-count debate.

Just weeks after extending an olive branch to the state’s most powerful Indian tribes, Gov. Arnold Schwarzenegger is threatening to try to shut down six of their casinos – including two of the largest in San Diego County – in a dispute over how their slot machine numbers are tallied.

Schwarzenegger spokesman Darrel Ng said that after a year of negotiations, the governor is convinced that some tribes are using slot machines with multiple seats to exceed the slot limits of state gambling agreements, or compacts.

At issue are multistation games on which groups of gamblers play at once. Most common are electronic version of blackjack, roulette or craps, with five to 10 seats per machine.

The move has tribal officials questioning why Schwarzenegger would launch what could be a major battle over a device that, as of now, accounts for only a small sliver of California’s $7 billion Indian gaming industry.

Tribes limited to 2, 000 slots count each multistation game as one machine because it’s controlled by one computer chip. The state contends that each station of the game counts as a slot for purposes of licensing and calculating the fees tribes must pay the state.

Pechanga, Barona, Sycuan and three other tribes began formal negotiations with the governor’s legal staff over the dispute last June. In February, tribal negotiators proposed limits of 12 stations per machine and no more than 10 percent of any casino’s devices being multistation.

Schwarzenegger’s reply came in a June 9 letter from his legal secretary, Andrea Lynn Hoch. Calling off further negotiations, he gave the six tribes 60 days, until August 8, to remove any over-limit or unlicensed machines, or be deemed in breach of compact.

After that date, Schwarzenegger could seek a federal court order to revoke the gambling compact of any noncompliant tribe.

“It’s what we call the nuclear option, “ said Sycuan attorney George Forman, who also represents Colusa. He said the tribes will have to decide whether to give in or fight in court.

Last month, Schwarzenegger hosted his first meetings with two dominant groups with whom he has been at odds over state controls and tribal sovereignty, the California Nations Indian Gaming Association and the Tribal Alliance of Sovereign Indian Nations. The alliance includes Pechanga, Morongo and 11 other tribes in Riverside and San Bernardino counties.

Schnur said that most big-gaming tribes – even those involved in the slot-count dispute – might have more to gain than to lose with Schwarzenegger in the mutual goal of keeping Indian casinos out of urban areas. He added he wouldn’t be surprised if some tribes fighting the governor wind up signing revised compacts with him to get more slots.

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