CNIGA - California Nations Indian Gaming Association

RESEARCH ARTICLES

Statement of Victor Preston, Chairman Susanville Indian Rancheria Before the National Gambling Impact Study Commission

Victor Preston
Chairman, Susanville Indian Rancheria
July 28, 1998 - San DIego, CA

Good afternoon, I am Victor Preston, Chairman of the Susanville Indian Rancheria. Congress in the 1988 Indian Gambling Regulatory Act (IGRA) established a statutory framework for the regulation of Indian gaming. The problem with the implementation of IGRA in California is that Governor Wilson, for eight years running, refuses to abide by the negotiation/mediation process set forth in IGRA. Therefore, for the Rancheria to obtain the benefits of Indian gaming intended by Congress, it must operate casino gaming without a tribal-state compact, while it works with other California Tribes in their relentless pursuit of a fair remedy. The Rancheria is proud to be a part of the California Nations Indian Gaming Association (CNIGA), which leads that relentless pursuit. The Susanville Indian Rancheria (“Tribe”), is a federally recognized Indian Tribe established pursuant to the Indian Reorganization Act in 1969, organized pursuant to a Constitution duly approved on March 10, 1969, possessing the sovereign and statutory powers to govern activities on its Indian lands, including its Rancheria of approximately 780 acres in Lassen County with Tribal headquarters located on the Susanville Indian Rancheria. The membershi of the Tribe consists of approximately 260 members, 130 of which reside on tribal lands. Many of the Tribe’s members, no longer residing on the Rancheria have left because of the lack of opportunity. The Rancheria is in rugged mountain terrain, far from major cities. The natural water supply, for a large segment is tainted and undrinkable, and the soil may be ruined due to years of bomb testing by the United States Military. Many non-members also look to the Tribe for assistance and opportunity. The Tribe’s health care clinic provides for 2300 patients, both Indian and non-Indian. General living conditions of the tribal members living on the Reservation were poor, with unemployment averaging over 40%. A third of the membership relied on public assistance to survive. Te tribal government is desperately underfunded such that it is unable to provide basic services to its membership, other than the health clinic. Federal funding of tribal programs has been drastically cut, causing the tribal government to rely on tribal economic development for its very survival. The isolation of the Tribe’s Rancheria rendered most members unable to travel the great distances to employment opportunities elsewhere in the State. Try to imagine the federal government, or any government being able to operate without a funding source. The Rancheria’s tribal government had no businesses to tax, no property to assess, no tax base on which it could rely for budgeting and planning. Even the Chairman’s position went unfounded, and tribal administrative staff were virtually nonexistent. The Tribe’s small casino has changed all of that. Since the beginning of its gaming operations, conditions at the Tribe have improved dramatically. Unemployment has dropped. The crime rate is down. Our Rancheria has become increasingly dependent on gaming dollars to fund its social services, education and scholarship programs, and topromote economic development to create even more opportunities for its members. IGRA mandates that Tribes spend gaming dollars on essential governmental services. Tribal members and non-Indians are taken off of welfare roles and placed on tax roles. The money is directed back into the local economy, creating more opportunities for our non-Indian neighbors. For the Susanville Rancheria, the issue is not one of gaming. Rather, it is an issue of tribal economic development, tribal self-sufficiency, and strong tribal government. At present, we are working hard in our effort to achieve self-sufficiency. Although we are not a big tribe located in a large metropolitan area, we are a fine example of how a small tribe is able to meet its needs while being able to contribute back to their neighbors in charity and economic investment.

Governor Wilson would like to characterize California Indian gaming as the acts of lawless renegades. That could not be further from the truth. Governor Wilson has consistently refused to participate in the process establish by Congress in 1988 for resolving such disputes in the federal courts. It was well known to California’s tribal leaders that efforts to have the State consent to IGRA’s negotiation/mediation process proved to be a lesson in futility. Indeed, California Attorney General’s Office lead the charge of the States in pressing the Eleventh Amendment, submitting amicus briefs in every jurisdiction where the issue was raised, as well as playing second-chair at the Supreme Court oral argument in Seminole Tribe. All problems in California are directly attributable to California’s defiance of IGRA’s negotiation/mediation process. Therefore, to each member of the Committee, I ask that if you have not already passed judgement on the California Tribes, please take a close look at the circumstances before you do. If you have already passed judgment on the California Tribes, please take time to review the true history of Indian gaming in the State of California and reconsider your judgment. The California Tribes’ goals have always been to obtain the position they would be in if California had consented to the negotiation and mediation process et down by Congress in IGRA over a decade ago. The Susanville Indian Rancheria opposes Governor Wilson’s efforts to dictate terms which do not provide the Tribes the opportunities to which they are entitles as a matter of federal law. The Wilson/Pala Compact is the product of coercion and duress, a result of the Governor’s whipsaw mentality in hiding behind the Eleventh Amendment to avoid the decision of an impartial mediator and the federal courts. The Wilson/Pala Compact is not the product of good faith negotiations. The Compact is designed to keep Tribes poor and to perpetuate hundreds of years of Tribal poverty. The Wilson/Pala Compact is designed towards the termination of tribal governments as sovereign entities, apart from the State of California. From our perspective, this is no less than economic genocide.

Recently, on March 27 th of this year, the Ninth Circuit Court of Appeals has handed downs its opinion in United States v. Spokane Tribe. In the Spokane case, a unanimous three-judge panel held that action against the Spokane Tribe’s non-compacted gaming operations in Washington State was inappropriate given that State’s refusal to consent to the process of negotiation and mediation set down by Congress in 1988. I encourage you to read the opinion and draw your own conclusions rather than blindly accept the narrow analysis of the State of California that all Indian gaming in the State of California that does now knuckle under to the coercion of the State to agree to the Pala Compact is therefore necessarily “illegal.” The Susanville Rancheria is further dismayed that the United States Attorneys in California have chosen to disregard the advice ofJudge Kozinsky of the Ninth Circuit that the federal government work with the Tribes to secure a remedy, and instead have initiated legal actions that threaten our very existence.

The Susanville Rancheria’s preferred remedy has always been and continues to be to work out a fair compact with the State, which provides for viable machine gaming. One of the myths I have heard is that California Tribes object to a state role in the regulation of gaming. That is not true. We welcome such a partnership, if only the State would negotiate in good faith with the Tribes, be reasonable, while not seeking to undermine Indian gaming with arbitrary market restraints, and not to seek concessions of tribal sovereignty that are unrelated to the effective regulation of gaming. CNIGA received questions from your Acting Executive Director. Although these questions touch on richly complex issues, in my written statement, submitted to you today, I attempt to provide brief answers from the perspective of the Susanville Indian Rancheria. I hope you take the time to review that statement. Thank you for the opportunity.

Question #1: How will the recent California Supreme Court decision invalidating Governor Wilson’s compact with the Pala Tribe effect the compacting process in California?

On June 25, Sacramento Superior Court Judge Lloyd Connelly ruled that Governor Wilson violated the Separation of Powers Doctrine of the State Constitution when he forced his personal agenda regarding Indian gaming into the Wilson/Pala Compact. Judge Connelly struck down the Wilson/Pala Compact. Governor Wilson has said he will appeal.

The California Legislature is charged with the responsibility of establishing policy regarding Indian gaming. Three years in a row, the Legislature passed laws that embrace IGRA. Three years in a row, the Governor vetoed that legislation. Just as tribal governments must follow their laws in executing a compact, the State government must also follow its laws. Governor Wilson’s execution of the Wilson/Pala Compact was an illegal act, and for now, the Wilson/Pala Compact is dead.

The Rancheria hopes the “effect” of Polanco et al. v. Wilson, is that the Governor will work with the Legislature to establish a policy that embraces IGRA, although we have seen no indication from the Governor to do so. Instead, he has become more entrenched and is strong-arming members of the Legislature to capitulate to his personal agenda. Until he, or a new Governor, works out a process with the Legislature, the State lacks the capacity to compact with the California Tribes.

Question #2: What is the legal status of gambling activities already offered by tribes in California who do not have a compact with the State?

There is no easy answer to that question. The position of Susanville is that California cannot preclude tribes of their sovereign and statutory gaming rights by merely refusing to negotiate in good faith or refusing to consent to the jurisdiction of the federal courts. Accordingly, we believe that the non-compacted gaming here in California is legal, andas the Ninth Circuit tells us, enforcement of the IGRA’s Class III gaming provisions is inappropriate. The Department of Justice tells us that non-compacted gaming is illegal, and that they have now supposedly secured from the State an effective waiver of Eleventh Amendment immunity. The State tells us that on the Wilson/Pala Compact is available, with minor changes, and tells us that it will “talk” about a different compact, but only if the Tribe shuts down its governmental revenue stream and put its members out of work.

The United States has brought civil-forfeiture actions against Tribes in each of California’s four federal Districts. A lawsuit files against the Rancheria’s machines is pending in California’s Eastern District. Last week, the judge denied the federal government’s attempt to seek immediate possession of the machines, and stayed the forfeiture lawsuits pending resolution of the recently filed IGRA lawsuits against the State. At last week’s Hearing, the State’s lawyers made the strongest statement which they truly have, and after eight years, come out from hiding behind the Eleventh Amendment. In California’s Northern District, no efforts for immediate seizure have been taken and the lawsuits are proceeding with various preliminary motions. In the Central District, the Judge had denied the federal government’s motion for a preliminary injunction against the Tribes and placed the forfeiture actions on the inactive calendar, but more recently indicated that he is likely to issue a permanent injunction against the Tribes in September. In the Southern District, the three gaming tribes have little confidence in the federal judge assigned to the case, (Two of the three) (All three) tribes have capitulated to Governor Wilson’s unconscionable demands and have signed versions of the Wilson/Pala Compact, stating that they did so “with a gun pointed at their heads.”

The Susanville Rancheria is hopeful, but skeptical that the State’s newfound “waiver” of Eleventh Amendment immunity is real. This most recent development may truly bring this eight year battle to fair resolution by the appointment of a federal mediator. This development, however, does not excuse the fact that Governor Wilson stalled the process for eight years, and manufactured a contrived result that he will now defend as proof of the State’s “good faith.” If the State had consented to the process after 180 days of negotiation, as Congress intended, enforcement action against Tribes would be appropriate. But this gesture is too little, too late, to justify enforcement action under the current circumstances.

Question #3: Why did most of the other California Tribes oppose the compact between the Governor Wilson and the Pala Tribe?

In short: (1) The Wilson/Pala Compact contains arbitrary market restraints that have no basis in California’s public policy; (2) The Wilson/Pala Compact contains numerous provisions that are unrelated to the effective regulation of gaming ; (3) The Wilson/Pala Compact was the product of coercion and duress, and not the product of good-faith negotiations; and (4) The Pala Band broke its commitment to include CNIGA and its member tribes in the process and to not a gree to objectionable terms. California does not tell Hollywood how many movies to produce, or the California State Lottery haow many tickets to sell. Tribes should be free to provide the entertainment that patrons want. Governor Wilson seems more committed to keep thesupport of Nevada’s casino industry as he prepares to run for President. Las Vegas has seen unheard-of growth since the huge expansion of non-Indian casino gaming which has spread across the country. We are not a real threat to Nevada. Yet, Governor Wilson seems bent on being “the best Governor Nevada has ever had.”

For years, Governor Wilson said the problems with tribal gaming were centered around the machines. Yet, he negotiates for a machine which Pala tells us “virtually eliminates” the distinction between the video lottery device and the slot machine. This tells us that his real agenda has not been the machine at all. Rather, it was to squeeze tribes into a position of making historical concessions of state jurisdiction in matters unrelated to the effective regulation of gaming. Many of these areas, such as employment and labor laws, environmental laws, building codes and zoning laws, include provisions that mirror the Tribe’s concerns on the same issues. But Tribes are already subject to federal laws in those areas and additional policies are to be set by the Tribe, not by the State. This is what self-governance is all about. The irony here cannot be overstated. The non-Indian government of the State of California is telling tribes how to best protect the environment, which ironically has been ravaged by 200 years of non-Indian development and abuse.

IGRA requires the State to negotiate with each Tribe in good faith. California has not complied with federal law. Over the eighteen months of negotiations, representatives of the Pala Band told CNIGA “we are at the mercy of the US Attorneys” and “we have no leverage since the decision in Seminole Tribe” and “you do not say ‘no’ to Governor Wilson.” With that type of defeatist attitude, which the Ninth Circuit has since criticized in the strongest terms, what type of compact is likely to come out of the supposed negotiations? There are 107 tribes with Indian lands in California. Governor Wilson worked to find the one Tribe, which would not say “no,” cut a bad deal, and is now forcing this deal down the throats of all California Tribes.

Ironically, the Pala Band was put into that position by CNIGA. At the end of the 1996 Legislative session, when Governor Wilson realized that CNIGA’s work on educating the State Legislature was paying off, he agreed to finally negotiate with one tribe, providing that it was not currently gaming. CNIGA looked to Pala and offered its name up as the candidate after the Pala Band committed to work with CNIGA, agreeing to include its leaders and lawyers in the process, and to not agree to any compact objectionable to CNIGA. When CNIGA began voicing its objections to the terms being discussed, CNIGA was closed out, the tribal leaders were excluded, and the few tribal attorneys that remained were forced to sign agreements that they would not disclose anything, not even to their own clients.

Question #4: Are tribes who already offer gambling without a compact free to negotiate a compact?

The Susanville Rancheria is now, and at all times has been, ready, willing and able to negotiate with the State in good faith. Until March 6, 1998, Governor Wilson flatly refused. Since March 6, the Governor has supposedly agreed to negotiate, but only under two scenarios. First, a Tribe can agree to the Wilson/Pala Compact, with only minor revisions, and by doing so, it can continue to operate its current activities until the new machine is commercially available (whatever that means). Second, a Tribe cannegotiate a completely different compact, but only if it shuts down, closes off its revenue stream for essential governmental programs and puts thousands out of work. Even if a Tribe made such an agreement, we are skeptical that the Governor would offer any material changes from the original Wilson/Pala Compact.

Question #5: If enacted, how will the ballot initiative affect the Pala Tribe Compact and the future of Indian gaming in California.

The Susanville Rancheria supports Proposition 5, which would set forth a compact that embraces IGRA, including a strong regulatory relationship with the State of California. If passed, the compact would be available to all Tribes with Indian lands in California, including the Pala Band. IGRA does provide that the State negotiate with each tribe, individually, and nothing in the initiative precludes the State from entering into a different compact with a Tribe, so if the Pala Band wanted to live by its existing compact, assuming the Legislature would ever ratify the compact, the Pala Band is free to do so. However, we expect that most, if not all, Tribes which seek to offer gaming on their lands, whill accept the initiative’s compact and bring this eight year struggle to a fair and final resolution. The initiative provides a future that enables many California Tribes to achieve IGRA’s goals of economic development, self-sufficiency, strong tribal government, a future of strong pragmatic regulatory partnership with the State, and a future business climate which allows Tribal governments to make long-term investments and planning. California Tribes do not want to be dependent on anyone, for anything, any more. We want to make our own way and earn our own keep, and we believe the California voters will agree with us.

Question #6: What is the resolution of this apparent conflict between State, Federal and Tribal interests.

The Susanville Rancheria does not perceive a true conflict between federal and tribal interests. The federal interests are embraced in IGRA. The Tribes embrace IGRA. Our conflict with the Department of Justice is that it does not embrace IGRA and instead is aiding and abetting the very states that defy IGRA. This is the heart of the issue in Spokane Tribe v. United States, and we encourage you to read that decision. The conflict between tribal and state interests is the basis for the mediation/negotiation scheme set out by Congress in 1988. The Legislative history is full of references to the delicate balance, which was struck. Remember, IGRA allowed the states to have a role in a process which had previously excluded states altogether. But rather than taking advantage of an opportunity to be involved in the regulation of Indian gaming, many states, with California leading the charge, have attempted to turn IGRA on its head and use it as a weapon to preclude tribes from exercising their sovereign and statutory gaming rights. IGRA’s delicate balance was obliterated when the Supreme Court in Seminole Tribe said that Tribes cannot sue states without their consent. This conflict between tribes and states will not be resolved until the federal government gets out of bed with the states and works with tribes to secure an adequate remedy. Bottom line, we need a remedy and will not stop fighting until we have one (won).

Thank you.