Jackpot

How four tiny Indian tribes, with help from powerful gambling interests, are trying to transform the Bay Area into a slot machine Mecca

Against that backdrop the small Pomo tribes and their powerful backers face opposition from not only anti-gaming forces, but also other gaming tribes, whose casinos in mostly rural areas could suffer should casino gambling take hold in the Bay Area. "Some of the larger tribes are steaming over this, and not just for business reasons, but because it's made them look like liars when they were saying during the Prop. 1A campaign that voters didn't have to worry about gaming expanding off the reservations," says Nelson Rose, an Indian law expert at Whittier College, near Los Angeles. "Now, with what's going on in the Bay Area, we're seeing a new twist on how Indian land is defined."


When the history of Indian gaming in California is written, the Lytton Band may well be remembered as "the little tribe that could" -- thanks to Miller and the tribe's politically savvy financial backer. With no reservation, few assets, and a staggering unemployment rate, the Lyttons would hardly seem to fit anyone's description of a political force. Their headquarters is a squat office building behind a Santa Rosa shopping mall. The tribe is so poor that since being restored as a sovereign nation in 1991 it has had to hold its tribal meetings in community centers and stage its traditionally private ceremonials in public parks.

But when it comes to Indian gaming, it isn't so much what you have as who you know. The Lyttons -- whose shrewd 47-year-old tribal chair, Margie Mejia, is an ex-staffer to former U.S. Rep. Gary Condit -- found a partner in Philadelphia investor and perennial Republican mayoral candidate Sam Katz. Publicly opposed to casino gambling in his hometown, Katz had no such qualms in faraway California. After leading the Lyttons on a dry run in 1998 while trying to strike a casino deal in Napa County, Katz turned to the Bay Area and the impoverished 2.5-square-mile East Bay community of San Pablo.

Just over the Bay Bridge and up traffic-clogged Interstate 80 from San Francisco, Katz discovered a card club called Casino San Pablo, whose owners were losing money and wanted to bail out. His and the tribe's ambitions were soon clear: acquire the club with a view to transforming it into a full-fledged Las Vegas-style gambling palace. The cash-starved town's elected officials were hip to the idea. As the tribe's surrogate, Katz in 1999 inked a deal in which the Lyttons agreed to pay San Pablo $5 million a year and maintain an existing contract with the Hotel Employees and Restaurant Employees International, the politically potent labor union whose members staff the club.

In relative terms, the card club was and is small potatoes.

The real payoff -- for Katz and his investor group, as well as for the tribe -- would come once the tribe was able to set up a glitzy casino replete with slot machines on the 9.5-acre parcel. The mere idea of doing such a thing so close to the heart of a major metropolitan area marked a radical departure in the strategic thinking of the Indian gaming community. Voters had approved Proposition 1A in 2000, ratifying casino gambling on the state's mostly remote Indian reservations as a way for tribes to achieve economic self-sufficiency. Back then Indian leaders had blitzed the TV airwaves with commercials assuring that if the measure passed, no one need fear that the tribes would exploit the law to operate casinos wherever they wished.

While he was governor, Gray Davis was obliged to negotiate gaming compacts with 53 tribes, but he remained staunchly opposed to urban casinos. The question was largely academic, in any case, since there were no Indian reservations within a major urban area anywhere in the state. And that didn't appear likely to change, despite the casino frenzy that Proposition 1A's passage unleashed. That's because a federal law that regulates Indian casinos limits tribes to operating casinos on land they possessed before Oct. 17, 1988, when the law took effect. Tribes that might have loved to acquire land in or near San Francisco or Los Angeles and have it declared a "reservation" for casino purposes were precluded from doing so.

But the law had a loophole. It made an exception for certain tribes that had sued the federal government for wrongly terminating their tribal status decades earlier and that had regained federal recognition after the 1988 Indian Gaming Regulatory Act was passed. Each of the Pomo tribes in the hunt for Bay Area casino properties -- the Lytton Band, Scott's Valley Band, Lower Lake Rancheria-Koi Nation, and Guidiville Band -- falls into that category. "The rationale was that these tribes shouldn't be barred from acquiring land just because their wrongful termination had prevented them from doing so before the 1988 cutoff," says Catherine Stetson, a New Mexico attorney who represents the Guidivilles. Yet the law didn't provide for acquiring land just anywhere. Indeed, after the Katz group bought the San Pablo property on the Lyttons' behalf, the U.S. Department of the Interior rejected the tribe's efforts to have the government designate the parcel -- far from the tribe's ancestral homeland in Sonoma County -- as "land in trust" under the statute.

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