State gambling regulators and tribal casino lawyers will meet again Monday in court to try to resolve differences over how each side interprets parts of their gambling agreements.
At issue this time is one of the most basic rules of accounting at tribal casinos: how the state counts the number of slot machines.
Slots provide most of the revenues at Indian casinos, but their agreements with the state limit each tribe to no more than 2,000 machines. The state collects millions in fees each year from tribal governments based on how many machines are in use.
However, new technology is making what seems a very simple counting procedure more difficult. New technology allows multiple terminals, and their players, to be connected to one central server system, or computer, that determines the outcome of the game.
Under new rules adopted Wednesday by the California Gambling Control Commission, which oversees tribal casinos, the state would count each terminal as a "gaming device," or slot machine. Some tribes —— including the Pechanga Band of Luiseno Mission Indians, which operates a large casino near Temecula —— want to count all the terminals connected to the computer as one slot machine.
The Pechanga tribe filed a lawsuit Monday in U.S. District Court in Riverside claiming that the state unilaterally changed the rules without consulting with the tribes in violation of their agreement, which is also known as a compact.
"The mutually agreed upon compact clearly articulates a process for proposing and adopting state regulations with respect to a tribal gaming operation," said Pechanga Chairman Mark Macarro in a statement released Friday. "The compact contemplates due process and the participation of tribal governments in the rule-making process."
"We are disappointed that the state refuses to follow the terms of the agreement," he added.
On Tuesday, Judge William J. Rea issued a temporary restraining order that keeps the state from implementing the new rules. A hearing is scheduled next week in Riverside.
Anna Carr, a spokeswoman for the commission, said the rules are under internal "legal review." Carr said the judge's restraining order applies only with regard to Pechanga.
The rules were based on a legal opinion issued by state Attorney General Bill Lockyer in October 2003. His office issued an opinion that said the 2,000-slot limit would be meaningless if tribes were allowed to count central server systems as one machine.
"A tribe could expand its gaming floor by simply adding a central server system, which would operate the play of potentially thousands of player station terminals and thereby circumvent the gaming device limitation and the payment of fees," wrote Christine Murphy, deputy attorney general.
If enforced, the new regulations would mean that Pechanga is using 91 more machines than the 2,000 slots it is allowed under its agreement with the state, according to court documents.
Carr said there may be other machines at the Morongo Band of Mission Indian's casino, near Palm Springs, that would be affected by the new regulations. But she said she was unaware how many machines.
Pechanga and Morongo recently agreed to remove from their casinos slotlike machines that the state said were also illegal.
Contact staff writer Edward Sifuentes at (760) 740-5426 or esifuentes@nctimes.com.
