Indian Casinos Not Ready to Remove Slots : Gambling: Tribal attorneys vow appeal of restriction on games. One prosecutor says he won’t force removal of machines until resolution of all issues.

It has not been a good two weeks for the Cabazon Band of Mission Indians, or for other California tribes that have banked their futures on casinos.

First, the tribes contributed more than $1 million to the Democratic Party only to have their gubernatorial candidate, Democrat Kathleen Brown, crushed by the man they see as their archenemy, Gov. Pete Wilson.

Then, the U.S. 9th Circuit Court of Appeals sided with the Wilson Administration in the long legal showdown over the tribes’ use of lucrative video slot machines, ruling that the state could not be forced to accept types of gambling that are illegal for others in California.

So there was some sense of doom Wednesday in the Native American communities that dot the state’s landscape.

“This will hurt us tremendously,” said Norma Manzano, former chairwoman of the San Manuel Band of Mission Indians in San Bernardino. “The casino revenue--the money from the machines--was our source of revenue.”

Yet on Wednesday, a day after the long-awaited appellate ruling, few were predicting any immediate unplugging of the thousands of beeping, flashing machines that have changed the face of gambling in California.

Tribal attorneys promised appeals to the U.S. Supreme Court and vowed to convince the courts that they did not introduce video slots to California--that the state’s own lottery beat them to it.

Meanwhile, the top federal prosecutor in San Diego, one of the hotbeds of tribal gambling--with three casinos housing 3,000 of the video devices--offered reassurances Wednesday that he would not force removal of machines that cause “no irreparable harm” until all legal issues are resolved.

On the Cabazon Reservation, home of the most aggressive tribe in the state, leaders were far from panicking over the setbacks, which Chairman John James conceded means the state “got the aces waiting for us.”

“This is frustrating, but we will win in the long run,” James said as a midday throng of gamblers continued to slide $20 bills into the video slots at the recently expanded and renamed Fantasy Springs Casino.

The tribes may have been left with a weaker hand over the last two weeks, but that of Wilson and state Atty. Gen. Dan Lungren has been strengthened. Lungren won reelection despite $800,000 in contributions from tribes to his Democratic opponent, Tom Umberg. The Cabazon gave $250,000 to the Democratic Party.

During a period when gambling has expanded rapidly in many states--not merely on Indian lands, but on riverboats and in resort areas--Wilson and Lungren have fought to prevent California from joining this modern-day Gold Rush.

Both have called for a state gambling commission, largely to regulate the growing number of card clubs, and they have also refused to negotiate gambling compacts with tribes that they say flout state law by installing electronic gambling machines.

“I remain emphatically opposed to the proliferation of casino gaming in this state,” Wilson said in a blunt Sept. 30 statement sent to members of the Assembly.

“If the tribes refuse to abide by the law now, the people of California can have little faith that they will comply with the terms of a negotiated compact later,” Wilson said.

Tuesday’s 3-0 opinion, issued in San Francisco, upheld his position, stating that “the state of California had no obligation to negotiate with Indian tribes on certain proposed gaming activities”--namely those forms of gambling “others cannot have.”

One issue was remanded to a Sacramento trial court, however: what games the tribes might be allowed as equivalent of the state’s own “video lottery terminals.”

Predictably, tribal attorneys took an expansive view of that opening and said they will continue to make the argument that the state’s keno game and other technology available to the lottery are the equivalent of the poker machines and other video slots.

“The tribes feel pretty comfortable that all they’re asking for is what the state lottery is authorized to do,” said Sacramento attorney Howard Dickstein, who represents five tribes, including the lead plaintiff in the case in question, the Rumsey Rancheria.

“It wasn’t a definitive ruling,” Dickstein said of the 9th Circuit opinion. (And) I feel confident that the status quo”--active casinos--”will be maintained pending some definitive ruling.”

But Lungren embraced the ruling as a repudiation of the tribes’ broad argument that the state, by sanctioning several types of wagering--including the lottery--had established a general public policy that made it hypocritical to oppose full casino gambling by tribes.

“The attorney general stated pretty clearly he doesn’t expect the gambling to go on. It’s illegal,” Lungren spokesman David Puglia said.

The National Indian Gaming Commission lists 23 tribes with gambling facilities in California, generating an estimated $1 billion a year in revenue. State officials say that could rise dramatically, however, because there are 45 pending applications for gambling compacts and many other small Native American groups are seeking federal recognition--perhaps to start gambling operations.

Whittier law professor I. Nelson Rose, an expert on gambling, said that any prohibition on the gambling machines could “put a damper” on plans by major casino companies to build showpiece facilities on tribal lands in California because the limited gambling would cut profits in half.

But the attorney for the Agua Caliente band said the ruling will have no effect on the most high-profile project, construction of a Caesars World casino in Palm Springs.

Attorney Art Bunce said the $25-million casino “will open as a Class II facility,” meaning without Las Vegas-level gambling, “with the hope and expectation that, before long, (it) will be available.”

Of greater immediate concern to the Agua Caliente, he said, is a lawsuit by the state contesting the right of Palm Springs to transfer lands to the tribe to help put together the downtown casino site.

As tribal and city officials prepared to meet to discuss a response to the state’s lawsuit, Bunce emphasized that the tribe still plans on building the Caesars facility--even if it means moving it.

“It might still be in Palm Springs, or in Cathedral City, where there are 3,000 acres of reservation land, or Rancho Mirage, where there are 800 acres of reservation, or on 17,000 acres of unincorporated land in Riverside County,” Bunce said, adding that the casino will open within 18 months, offering games now permissible in California, such as poker, off-track betting and bingo.

In Indio, Cabazon officials said they never would have earned close to the $60 million brought in last year were it not for 500-plus electronic gambling machines. But they promised to comply with any final ruling of the U.S. Supreme Court--where their the tiny band won the first landmark case in Indian gambling, giving tribes the right to offer bingo games without the limits on prizes imposed on nonprofit groups and charities.

“We could have gone crazy and brought in 15,000 machines, and gone hog-wild,” said Chairman James. “But we’ll play by the rules.”

Cabazon’s chief executive officer, Mark Nichols, said gamblers probably will balk if the tribes lose their machines because “we offer much better return for the players. The state’s games have worse odds and less prizes.”

With their long--and largely successful--experience with the legal system, tribes like the Cabazon are finding it tougher to deal with last week’s election than the subsequent court ruling.

“I think the state will be emboldened by the political changes,” said attorney Dickstein, citing a Tuesday hearing on gambling issues in Sacramento, at which the tribes “as usual (became) the scapegoat for society’s problems.”

At the hearing, representatives of card rooms complained that tribes had unfair advantages--and asked for the right to conduct the same games. A horse racing group blamed tribal casinos for slumping performances in their field. And state Sen. Ken Maddy (R-Fresno) called for a campaign to get Congress to amend the Indian Gaming Regulatory Act to make it harder for tribes to annex land off their reservations for casinos.

Maddy, a supporter of horse racing interests, said he hopes the state’s position “may find a better reception” in Congress now that there is a Republican majority.

But some tribal leaders found humor amid the setbacks.

Cabazon’s James said his tribe now hopes Gov. Wilson will run for President in 1996--to get him out of the governor’s mansion. “Gray Davis can run for governor in two years, and we’ll back him,” James said.