Tribes, Casinos Roll Dice With Early Ad Blitz

At a time of year known for TV reruns rather than political advertising blitzes, a virtually unprecedented media campaign already has been launched for a November ballot measure--one that arguably will have little personal impact on most voters yet will probably become one of the costliest political battles in state history.

The measure, Proposition 5, seeks voter permission for California’s Indian tribes to operate the kinds of casinos that the state deems illegal and allow additional casinos without the approval of the governor or the Legislature.

Already, the two sides are shelling out more than $1 million a week on TV commercials. With their sizable bankrolls, the campaigns are expected to spend--combined--more than $75 million by election day.

Political veterans are hard-pressed to remember a campaign starting so early in the season, except perhaps the unsuccessful 1988 battle by the insurance industry to derail Proposition 103, which sought to roll back rates.

The early start for Proposition 5 was prompted, in part, because the tribes pushing the measure believed that they were on a roll. Under a tight deadline to qualify the initiative for the November ballot, the tribes turned to television for a boost. Their savvy April ad campaign proved so successful that without missing a beat, they blended that TV blitz into the new one, thanking voters and asking for their continued support.

“Once you start talking about the issue, it made sense to keep it going,” said Dan Pellissier, spokesman for the tribes.

Moreover, the tribes had the money to start an early campaign--and the opposition, a coalition of entertainment firms including Nevada casinos, has the money to respond. Each side says it wants to frame the issue before other races begin to clutter the airwaves, arguing that the proposition’s details--and even the general subject of Indian casinos--are arcane to most voters.

“People don’t normally focus on an election until 30 days [before], but this kind of image advertising will have an early impact on building and shaping opinion,” said Barbara O’Connor, director of the Institute for the Study of Politics and Media at Cal State Sacramento. “Right now, it’s a clear field for both sides, so since they have enough money, they can start.”

In defining the issue, both sides are taking license with the facts.

The second of three television commercials sponsored by Californians for Indian Self-Reliance, the committee formed to promote the initiative, states that if the measure is approved, Indian gaming will be “strictly regulated by federal agencies and tribal governments.”

What the ad doesn’t say is that the initiative circumvents the state’s significant role in regulating casino operations. Additionally, the “Yes on 5” commercial says California Indian gaming “generates $120 million in tax revenues each year.” But because the casinos are owned and operated by Indian tribes, they are not taxed on their revenues, just as the state of California pays no taxes on its lottery income, for example--or anything else.

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The $120-million tax revenue estimate, provided by a consulting company hired by the tribes, actually reflects the projected economic trickle-down effect of casino businesses. It includes the amount of sales tax paid when casino employees spend their paychecks in the community, the tax paid by casino patrons who buy hot dogs and souvenir T-shirts, the state income tax paid by non-tribal casino employees, and taxes paid by companies whose business prospers by being near a casino, such as restaurants near the reservation.

The opposition is no less guilty of tweaking the facts.

Its first TV ad features an actress in the role of a coffee-shop owner, complaining that the gaming initiative “could allow hundreds of casinos to be built anywhere in the state, maybe right across the street from me.”

In fact, they could only be built “anywhere” if a tribe acquired new reservation land--then won the approval of the governor and the U.S. secretary of the Interior to develop a casino. Instances of that happening around the United States are exceedingly rare.

The measure’s proponents began trolling for public support in April, with their wildly successful petition drive to qualify the initiative for the November ballot.

In a strategy widely applauded by political consultants--and costing an estimated $10 million--the Indians used television to ask voters to watch for mass mailings in which petition papers were sent to individual homes. Were it not for that TV promotion, those envelopes might have been tossed out as junk mail.

Even the tribes--who faced a one-month deadline to collect enough signatures--were surprised by the success of the campaign. Had they known that they would collect more than 1 million signatures, they would have sought to qualify a constitutional amendment for the November ballot. Instead, their measure would only rewrite state statute, thus exposing them to a challenge over its constitutionality.

The tribes are carrying the momentum with the ad campaign, forcing opponents to respond.

“We wanted to prevent the ‘yes’ side from defining the issue on their terms,” said Frank Schubert, who is helping direct the opposition campaign. “We were not trying to win the campaign in June. We just didn’t want to lose it in June.”

If the expenditures accelerate as expected, the campaign will approach the record-setting $83.9 million spent by the insurance industry, trial lawyers and insurance reform activists in 1988, primarily in the battle over Proposition 103.

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Money on the Indian gaming initiative will flow in huge amounts from both sides because what’s at stake is, well, money.

By their own accounting, the 41 California tribes that operated casinos in 1997 made about $632 million in net profit--at a time when Gov. Pete Wilson and federal authorities said the casinos were operating illegal slot machines. This initiative would give the tribes the right to do more of the same, and all but cut the state out of the regulatory picture.

Fighting the measure are entertainment-oriented businesses that are not eager for customers to drop their discretionary income at Indian casinos. Besides the Nevada casino operators, who estimate that Californians generate about 75% of their business, opponents include associations that represent California’s racetracks, card clubs and restaurants, Hilton Hotels, even the Walt Disney Co.

The TV commercials have been designed to enlist the support of voters who otherwise might not feel strongly about gambling.

The tribes, consultants say, want the electorate to see them as the underdog: Is it fair that others--especially Nevada casinos--are trying to prevent Indians from improving their lifestyle, especially if they have suffered from economic neglect for so many years?

The opponents want voters to consider the equity of it all: Is it fair to allow Indians to write their own ticket in developing casinos, while other businesses are taxed and more closely regulated?

In the end, though, all this spending could still be for naught.

If the measure passes, it is sure to be challenged in the courts. Some constitutional law experts, including San Francisco attorney Joseph Remcho, believe that the measure is illegal because what the Indians want to do--by amending state statutes to allow their casinos--is banned by the state Constitution, which takes precedence.

Still, most tribes want the voters’ blessing so they can at least take their measure to court for battle and, in the meantime, show state lawmakers the kind of public support they have.

“What you’re seeing with this initiative is equal parts of frustration, testosterone, a healthy dose of money and a little bit of ‘We’re not going to take this anymore,’ ” said a consultant to several tribal councils.