Schwarzenegger-negotiated casino deal costs California USD 36.2M

It all started when Schwarzenegger gave permission to the tribe to add slot machines to Casino Pauma, but in return reserved the over-payments from millions of dollars to the General Fund.

The decision for the massive re-payment was reached by federal appeals court Judge Richard C. Tallman, who wrote in October, 2015, that the tribe had agreed to a much more expensive amendment in 2004 due to misrepresentation. Thus, the judge concluded that Pauma was eligible to get back the $36.2 million in over payments it proceeded to the state, while the amendment is to be revoked.

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Lawmakers are expected to act on the Senate Bill 1187 by no later than the 31st of August – the deadline for approving bills. The legislation related to appropriating the money came out near the beginning of the month

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The problem between the Pauma Band of Louseño Indians and the state first started more than 10 years ago, when the tribe set off to add Vegas-style gambling machines and therefore signed a tribal casino compact, just like over 60 other California tribes did back in 1999.

However, since their attempt came five years later, the Schwarzenegger administration responded by informing the tribe that there were no available slot licenses and thus a new deal must be made.

The new agreement was made in 2004, and it stipulated that the annual payment the tribe had to make to the state was $7.75 million, instead of the $315,000 previously paid. But, as it was later determined, there were additional 1999 slot licenses at the time, hence a lawsuit was filled claiming that officials intentionally misled them in order to make them pay more.