State sets deadline for Pechanga video lottery terminals

By: EDWARD SIFUENTES - Staff Writer | Tuesday, January 4, 2005 11:33 PM PST ∞

The Pechanga Band of Mission Indians, which operates a casino near Temecula, has until Saturday morning to remove or modify some 1,700 video lottery machines that the governor's office says are illegal, a spokesman for Gov. Arnold Schwarzenegger said Tuesday.

The spokesman, Vince Sollitto, said the state may sue Pechanga if it does not agree to remove the machines.

"Both sides have expressed the desire that that not happen," he said.

The statement from Sollitto came after the Morongo Band of Mission Indians, which also had the machines at its casino near Palm Springs, agreed Friday, following weeks of negotiations, to stop using them.

Sollitto said the governor's office sent a copy of the agreement to Pechanga, as an example of what was acceptable to the governor. He said the tribe had not responded.

Pechanga officials could not be reached for comment.

Video lottery machines look and act like Las Vegas-style slots, but administration officials say the games cheat the state out of casino revenues and let tribes get around the 2,000-slot limit set in their agreements with the state.

Under the terms of their 1999 gambling agreements with the state, tribes are allowed to operate lottery games. But state officials argue that tribes are not allowed to use lottery games that look like slot machines.

Moreover, the 1999 agreements allow tribes to have a maximum of 2,000 slot machines, which Morongo and Pechanga already have. Using the video lottery machines allows them to avoid the cap without renegotiating the terms of their agreements.

Video lottery machines were seen by some tribes as a way to circumvent negotiations with the governor, who insists on more money and more intrusive state regulation on patron dispute resolution, labor rights and environmental rules.

Tribes, such as Pechanga and others, see those potential regulations as an intrusion on their sovereignty.

Other tribes, including five that signed renegotiated agreements with Schwarzenegger, disagree. Those tribes, which include the Pala, Pauma and Viejas bands in San Diego County, have said the video lottery games dispute is potentially devastating to the Indian casino industry in the state.

The reason they fear legalizing the video lottery machines is that if tribes win the right to operate them, then other nontribal businesses, including card clubs, could also use them, some tribal officials have said.

Under the agreement reached by the governor's attorneys and the Morongo band last week, the tribe agreed to remove or modify the software in its video lottery games to comply with state rules by Jan. 8. The machines can be converted into bingo-style games or will have to be shut down, Sollitto said.

The agreement also restricts the state from suing the tribe but allows the Morongo band to seek a ruling from a judge on whether the video lottery machines are allowed under their compact with the state.

"It's an agreement without hostile litigation," Sollitto said. "It is a victory for both sides. The state is certainly pleased it has been able to resolve this issue in a government to government manner."

George Foreman, an attorney for the Morongo band, told the Associated Press that the tribe decided to agree to the terms rather than face a possible lawsuit that could have cost them the right to operate a casino.

"The tribe has complied with all aspects of its compact," Foreman said. "However, because the tribe's first priority is to protect its compact, its members and the thousands of employees and businesses who rely upon its gaming operation, it was important to establish an amicable agreement with the state that would foster ongoing mutual cooperation."

Sollitto said the agreement with Morongo is a victory for the governor's effort to bring tribes to the negotiating table to contribute more money to the state.

"There has been a view that these machines were an attempt to expand tribal casinos without an agreement, and it's clear that the governor is not going to allow that," he said .

The Associated Press contributed to this report.

Contact staff writer Edward Sifuentes at (760) 740-5426 or esifuentes@nctimes.com.

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