Tribe Drops Vegas-Style Casino Plan

An Indian tribe has scrapped plans for now to open the first Las Vegas-style casino in a major urban area in California, the tribe’s spokesman said Saturday.

But while the Lytton Band of Pomo Indians has put on hold plans to install traditional slot machines in its card room in the Bay Area city of San Pablo, the tribe said it will add several hundred electronic bingo machines that look like traditional slots and are somewhat akin to them. The tribe also intends to renovate its existing card room.

It can take both steps without state approval, said tribe spokesman Doug Elmetz.

Gov. Arnold Schwarzenegger last year agreed to a compact with the Lytton band that would have permitted the tribe to install up to 2,500 slot machines in a five-story casino that would have taken up as much as 500,000 square feet. In exchange, the tribe would have paid to three governments 25% of its revenue -- which probably would have produced more than $100 million annually -- for the state, Contra Costa County and the city of San Pablo, near Oakland.

Under its revised plan, the tribe will be under no obligation to give the state or county any money, although Elmetz said the tribe would increase payments to the city.

Vince Sollitto, a spokesman for the governor, said, “We understand that they have got to provide for their financial security,” but added that the governor holds out hope the Legislature will take up the casino compact.

Asked whether the tribe’s announcement could be viewed as a negotiating ploy, Sollitto said it “does highlight the reality that the state faces, given the tribes’ federal rights.”

State legislators from the Bay Area opposed the casino, as did U.S. Sen. Dianne Feinstein (D-Calif.). And, earlier this month, Rep. George Miller (D-Martinez) announced his opposition. It was Miller who pushed through special legislation in 2000 allowing the formerly landless Lytton tribe to obtain reservation land in urban San Pablo.

“We made little headway in the Legislature, which seemed intent on stopping the development,” Elmetz said of the tribe’s decision to put its casino plan on hold. He added that the tribe and its lobbyists concluded that the proposed casino compact had “little likelihood” of winning approval this year.

The announcement does not preclude the tribe and legislators from revisiting the proposed compact in the future.

In a letter to Schwarzenegger dated Friday, the Lytton chairwoman, Margie Mejia, said she hoped either the current Legislature or future lawmakers would approve the compact.

The tribe also could sue the state to compel it to approve a new compact, although Elmetz downplayed that option.

More than 60 California Indian tribes have agreements, called compacts, authorizing them to operate casinos.

In most of those deals, tribes are limited to installing no more than 2,000 Nevada-style slot machines, the most profitable game for any casino owner. Some tribes have tried to circumvent that maximum by installing machines that they contend do not meet the definition of slot machines. In some instances, those machines mimic lotteries; others simulate bingo games.

The state contends that the lottery-type machines are in effect slot machines and therefore subject to the limit.

In her letter to the governor, Mejia said the tribe does not “intend to push the envelope” by installing video lottery terminals but would stick with the bingo machines, which it contends are legal.

Assemblywoman Loni Hancock (D-Berkeley), who led the opposition to the proposed casino, said Saturday she was “very pleased” with the announcement that the tribe is backing off its casino plans. She added that bingo machines are “less lucrative and will draw fewer customers.”

Hancock earlier had expressed concerns that a casino would add more traffic to an already congested area.

She added that she wasn’t concerned that the state would lose payments. Casinos “shouldn’t be a moneymaker for the state,” Hancock said.

The tribe, with about 250 members, originally was based in Sonoma County, an area now dominated by vineyards and winemaking. The tribe’s financial backers include the Maloof family, owners of the Sacramento Kings basketball team and the Palms Casino in Las Vegas. Another of its backers is the Hotel Employees and Restaurant Employees International Union, which has a contract with the existing card room.

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Times staff writer Jean Merl contributed to this report.