Editorial: California wager is a big gamble

Wednesday, Feb. 23, 2000 | 9:28 a.m.

In 1988 Congress passed the Indian Gaming Regulatory Act, which not only was supposed to ensure that tribes would be allowed to offer gambling on their reservations to aid their struggling economies, but also that the states would be able to exercise some control over this activity. Some states fortunately have entered into agreements with tribes that have required at least modest oversight, but an agreement worked out with the tribes by California Gov. Gray Davis (and which Californians will vote on next month) has all the makings of a disaster. As the Los Angeles Times pointed out in an extensive story on Saturday, if voters pass the initiative, state regulators there will not have the same powers as Nevada gaming regulators do. For instance, the Times reports that California won't be able to prevent convicted felons from working at casinos or conduct un announced inspections. That's not all:

"Unlike their counterparts across the state line, Sacramento regulators lack clear authority to audit casino books or inspect slot machines. And unlike Nevada, Davis granted tribes the discretion to permit people as young as 18 -- the age of many high school seniors -- to wager. Moreover, if a tribe disputes a jackpot, the tribes' own gambling commissions will resolve the dispute. Patrons will not have the right to appeal to courts," Times' reporters Dan Morain and Tom Gorman wrote.

The tribes note that they, unlike private businesses, have sovereignty. Therefore, the tribes believe, they shouldn't be subject to the same regulations. Yet, as the Times reporters discovered, other states that have entered into compacts have in fact allowed strict scrutiny. "We can inspect machines, unannounced," Arizona Gaming Department spokesman Paul Walker told the Times, who was astonished by the California proposal. "If you're a felon, you're not working at a casino in Arizona."

So far it appears that the Indian casino measure will pass easily. The Nevada-based casinos that had fought a previous Indian-gaming ballot question have decided to remain silent this time. Some casinos even are entering into partnerships with the tribes so that they, too, can cash in on this potential money-making venture. Lack of oversight over the tribes, though, could invite a stinging backlash if a scandal erupts someday. That backlash wouldn't just extend to the tribes, it also would impact those gaming companies assisting the tribes and it might even tarnish gaming everywhere, including here in Nevada.

For more than a decade now Sens. Harry Reid and Richard Bryan, both D-Nev., have been warning about the dangers of allowing Indian gaming with little regulatory oversight. Nevada had to learn the hard way about how casinos can invite corruption if regulators don't have the necessary enforcement powers. Today, however, Nevada's strict oversight stands as a model for other states. It's too bad, then, that with all this knowledge about gaming's dangers, California has decided to take such a huge risk.