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Pechanga seeks alternative to Schwarzenegger deal

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TEMECULA -- While a handful of gambling tribes signed new compacts with Gov. Arnold Schwarzenegger on Monday, the Pechanga Band of Luiseno Indians is one of several seeking an alternative deal that helps with the state's fiscal crisis while "respecting" Indian sovereignty, a tribal official said.

In a written statement Monday, tribal Chairman Mark Macarro said that while his tribe does not oppose the agreement Schwarzenegger signed with five tribes Monday, the agreement "should not be a model that is forced upon all California tribal governments."

Macarro declined to be interviewed.

Under the Schwarzenegger deal, tribes would provide $1 billion to the state this year and 15 percent of their casino profits -- about $200 million a year -- in the years to come. In exchange, the state would allow tribes unlimited expansion of their slot machine operations. The five tribes who signed onto the deal Monday were the Pala and Pauma bands of North San Diego County, the Viejas band in Alpine and the Rumsey and United Auburn bands in northern California.

Pechanga, which operates one of the state's largest casinos, southeast of Temecula, and a group of other powerful tribes -- including the Agua Caliente of Palm Springs, the Morongo near Banning and the Sycuan near El Cajon -- have proposed an alternative deal to state lawmakers that would provide $1 billion up front and up to 10 percent of their annual casino profits, the San Francisco Chronicle reported Monday.

In his statement, Macarro said the Pechanga would also agree to a number of concessions, such as additional health care for employees, binding arbitration for consumer complaints and establishing agreements with local governments affected by nearby casino operations.

The tribe balked at a piece of the Schwarzenegger plan dealing with disputes between tribes and local governments and labor unions. Macarro said the tribe has a good relationship with the city of Temecula and Riverside County and that state intervention is not necessary. He did not address the difference in percentages between the two deals.

"We have conducted ourselves in a responsible manner and have been good neighbors," Macarro said. "To date, Pechanga has voluntarily paid more than $8 million to the City of Temecula to offset the impacts of its gaming facility."

Most of the money has gone toward road projects in southern Temecula, including the widening of the Pechanga Parkway bridge over Temecula Creek.

Talks of an alternative deal were not warmly embraced by the governor's office. Schwarzenegger spokesman Vince Sollitto had little to say about further negotiations.

"The governor has made clear to those tribes the terms of the deal he signed today with a number of tribes," Sollitto said. "It is to those compacts that he would like other tribes to join."

Sollitto added that, to date, Schwarzenegger has received no formal proposal from the holdout tribes.

Macarro's statement Monday broke the silence of a tribe that has, until recently, been at the center of Indian gambling issues in California.

Macarro was the most recognized spokesman for the ballot initiatives that legalized Nevada-style gambling on reservations in California. In 1998, he appeared in television commercials pushing Proposition 5, a ballot initiative to legalize slot machines that was later overturned by the state Supreme Court. He then took the lead as a spokesman for Proposition 1A -- an initiative to amend the state's constitution to allow slot machines in Indian casinos -- which voters passed with 65 percent approval in 2000.

Slot machines drive casino profits and with the passage of Prop. 1A, Indian gambling turned into a $5.1 billion-a-year industry, according to a March 2004 study by UC Berkeley.

The money also allowed tribes to become a formidable political force. California gambling tribes are the largest contributors to political campaigns and Pechanga entered the fray last year after candidate Schwarzenegger announced he would make tribes "pay their fair share" if he were elected. Pechanga and others spent more than $11 million to back Schwarzenegger's opponents and Macarro appeared in television ads criticizing him.

One critic of Indian gambling said the tribes' involvement in the recall hurt their credibility with the public.

"That identified them as a special interest in the minds of many," said Cheryl Schmit, director of Stand Up For California. "It doesn't matter what they did in the past. Many people thought they were playing checkbook politics."

After he won, Schwarzenegger began pushing to have gambling tribes help bail the state out of its budget crisis.

Two rival gambling initiatives that would do just that have qualified for the November ballot. One would require tribes give the state up to 25 percent of their casino take, and if any tribe balked 16 card clubs and racetracks around the state would be allowed to put in slot machines -- thus ending the tribes' monopoly on the machines.

The other initiative, backed by the Agua Caliente Band, which operates two casinos in the Palm Springs area, would make gambling tribes pay the equivalent of state corporate income tax, just under 9 percent, on their gambling revenue. In exchange, tribes will be allowed to operate an unlimited number of slot machines.

That initiative will be abandoned, however, if Agua Caliente reaches an alternative deal with the governor, said Gene Raper, a political consultant for Agua Caliente.

Raper said now that their initiative will be on the November ballot, the tribe will be aggressively seeking endorsements and they would welcome Pechanga's support.

"They're one of the top 10 gaming tribes," Raper said. "We hope all 10 will support us."

About 53 percent of Californians support letting Indian casinos expand in order to bail out the state, while 39 percent think it is a bad idea, according to a poll by the Public Policy Institute of California. On the flip side, 48 percent of Californians don't like the idea of allowing non-Indian groups to have casinos, compared to 47 percent who do.

Contact staff writer Michael Buchanan at (909) 676-4315, Ext. 2623, or mbuchanan@californian.com.

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