Weighing Casinos’ Winners, Losers

Before the boom in Indian casinos, Gamblers Anonymous held one meeting a week in Palm Springs and the surrounding Coachella Valley. The self-help group now holds sessions every day, with two on Saturdays and Tuesdays.

“This is ground zero,” said Tom Tucker, a former gambling addict who was presiding over a gathering of 15 people at a Palm Springs restaurant. In a brightly lighted banquet room, some told somber stories of squandering family savings and retirement checks to feed slot machines.

“There are so many casinos here,” Tucker said.

The valley is home to one of California’s densest clusters of gambling halls; five are within a 30-mile drive. It’s perhaps the Golden State’s closest replication of Nevada.

Residents say Proposition 70, which would allow unbridled expansion of gambling on Indian reservations, raises the stakes in the debate weighing the industry’s economic benefits against its social costs. Its main sponsor is the Agua Caliente Band of Cahuilla Indians, based in Palm Springs.

Tucker and fellow addiction counselors see lessons for other parts of the state, where Indian casinos have multiplied from San Diego County to the hinterlands of Northern California.

But many business and government leaders say gambling has been a net win for the desert valley, despite complaints that casinos have driven up crime and created an underclass of low-paid workers.

“I’m not a gambler,” said Palm Springs Mayor Ronald Oden, “but I’m not opposed to people enjoying it as a form of entertainment.”

Oden and tourism officials say the betting parlors dotting the sand-blown region from Palm Springs to the city of Coachella have generated several thousand jobs and seeded the construction of hotels.

The casinos have yet to draw significant numbers of tourists who have strictly wagering in mind, said Gary Sherwin, a marketing vice president for the Palm Springs Desert Resorts Convention and Visitors Authority. “We’re not going to out-Vegas Vegas, but we’re a fantastic option.”

He estimated that 1% to 3% of the valley’s 3.5 million annual visitors were “destination gamblers.”

The fact that most casino customers are locals troubles addiction counselors, but folks such as Gary Paterson and Lou Capecci are undisturbed. The Palm Springs residents were leaving the Agua Caliente’s midtown Spa Resort Casino on a recent night.

“I don’t see a downside,” said Paterson, an artist.

Capecci, a construction manager, nodded. “They did this in very nice style,” he said of the gleaming, fountain-fronted casino, which opened last year.

The Agua Caliente is the lone California tribe with two casinos -- the second is in nearby Rancho Mirage -- and the Spa Resort is the only one in the state that sits in the hub of a city.

Palm Springs’ civic promoters have formed a partnership with the Agua Caliente. A section of the city’s visitors center, a winged-roof landmark of Albert Frey’s mid-20th century modern architecture, is devoted largely to advertising the tribe’s casinos, along with its cultural museum and Indian Canyons hiking trails.

The city’s growing association with gambling pains Jim Jones, a retired real estate investor who briefly served on the City Council. Under Proposition 70, there would be “casinos everywhere,” said Jones, sitting in the living room of his rambling home, where movie producer Mike Todd once lived.

Framed by the knuckled peaks of the San Jacintos, the neighborhood is redolent of the old Palm Springs, where Frank Sinatra’s Rat Pack partied and Clark Gable and Greta Garbo relaxed between film shoots. Actor William Holden had a house across the street from the Joneses, and Liberace’s digs were down the block.

“At that time, it was a quieter town,” says Jones, who believes that gambling is tarnishing Palm Springs, and that more casinos could be built even if Proposition 70 fails. “I don’t live in Las Vegas; I don’t live in Reno. If that happens here, we’ll probably be looking for someplace else to live.”

Proposition 70, one of two gambling initiatives on the November ballot, would amend the Indian compacts with the state that restrict tribes to two casinos each and a total of 2,000 slot machines. It would free them to operate as many casinos on reservations as the market would bear, offer unlimited numbers of slots and introduce currently prohibited games such as roulette and craps.

In exchange, the tribes would pay about 9% of their profits in state fees. They are exempt from taxes because federal law grants them sovereignty from the state. The tax issue is a sore point among Coachella Valley gambling opponents, who say the casinos should pay for the burdens they place on police and fire departments, and for clogging streets with cars.

Proposition 68 would permit slots at five horse-racing tracks and 11 card clubs if any tribe owning a casino did not agree to pay 25% of its take to local governments and comply with state environmental and campaign finance laws. Polls show both measures losing, and Proposition 68’s backers have abandoned their effort as a lost cause.

Agua Caliente Chairman Richard Milanovich said the tribe has no immediate plans to open more casinos, but wants the freedom to do so.

“The majority of residents enjoy having us in the valley,” he said. “We’re forecasting greater and bigger audiences coming to the Coachella Valley to visit casinos. It’s done wonders for the community overall.”

For competitive reasons, not all casino proprietors in the valley are enthusiastic about Proposition 70. Some say it favors the Agua Caliente, whose casinos and extensive land holdings are in prime locations for expansion.

Down Interstate 10 from Palm Springs, in Indio, the Cabazon Band of Mission Indians is building a 250-room hotel next to its Fantasy Springs Resort Casino. James McKennon, the casino’s chief executive, says the tribe is happy with its allotment of roughly 2,000 slots, and worries that Proposition 70 could trigger a “mass proliferation” of one-armed bandits on Agua Caliente land.

Just across the highway is the Trump 29 Casino, a venture of the Twenty-Nine Palms Band of Mission Indians and Donald Trump. Gary Kovall, an attorney for the casino, says it is satisfied with its 2,000 slots.

“We don’t need to add any in the foreseeable future,” he said.

Casino representatives close ranks in disputing assertions that their workers are underpaid and cannot afford health insurance. Unite Here, a labor union trying to organize employees at the Agua Caliente casinos, conducted a 2003 survey that found that 75% of them were paid less than $10 an hour.

Bob Hester, the tribe’s human resources executive director, said the average wages at the two casinos are $10.62 and $11.27. Because of rising costs, he said, the tribe has begun charging employees $780 a year for individual health and dental insurance. Workers must pay $5,000 annually for full family coverage.

Tribal officials insist that casino wages and benefits are on a par with or superior to those of other leisure industries in the valley. They also say the tribes donate generously to gambling addiction programs -- the Agua Caliente funds Tucker’s council -- and that the casinos try to spot compulsive bettors for the purpose of banning them.

And they maintain that any spikes in crime around their properties, such as car burglaries and assaults, result from foot traffic. In Palm Springs, police calls at the casino jumped from 566 for all of 2003 to 650 for January through mid-October this year. Most were for minor offenses.

Gambling advocates say shopping malls log similar crime tallies.

“They’re great neighbors,” Gene Raper, Yes on 70 campaign manager, said of the casinos.

Michael Rosenfeld, a Coachella Valley High School teacher and vocal critic of the tribes’ labor practices, has a starkly different view. He says the casinos are exploitive employers.

“They’re just taking advantage of the poverty that is here,” he said while driving his pickup truck past sprawling settlements of wilted and rusted mobile homes, jammed together like bricks in a wall.

Children and skinny dogs scampered in tiny dirt yards. A trash fire blazed in the evening gloom. The stench of dying algae wafted from the Salton Sea, five miles away.

At this end of the valley, Rosenfeld said, the trailer parks house thousands of unskilled workers, most of them Mexican immigrants. The living conditions can be squalid, with sporadic running water and electricity delivered by extension cords strung between trailers.

“The only place casino workers can afford to live is out here,” said Rosenfeld, who wants the gambling businesses to pay fees to support the schools.

Back in Palm Springs, at the Gamblers Anonymous meeting, tales of shortchanging the family were a refrain.

“I gambled my whole paycheck every week,” said Stephanie E., a school district worker who, in accordance with a Gamblers Anonymous rule, asked that her last name not be published. As her young daughter tugged at her arm, Stephanie said she blew $60,000 in five years on nickel slots.

“I wish there weren’t so many casinos,” she said.