Court clears way for Arizona gaming deals

Beth DeFalco

Wednesday, Nov. 27, 2002 | 9:43 a.m.

PHOENIX -- The Arizona Supreme Court on Tuesday denied an injunction request by dog and horse track owners, opening the way for Gov. Jane Hull to immediately sign casino agreements with American Indian tribes.

It was the third time in three days that the tracks petitioned a state court for a stay preventing the implementation of Proposition 202, a measure to expand gambling on tribal lands that was approved by voters Nov. 5.

After hearing oral arguments Tuesday, Supreme Court Justice Michael Ryan quickly denied the request without comment.

"We're pleased now that three courts have rebuffed the racetracks' efforts to prevent the signing of compacts," Scott Bales, a private attorney representing the state, said.

Under 202, the number of slot machines will be increased, and casinos can add Las Vegas-style house-banked blackjack, which was not allowed previously. In exchange, the tribes will give the state up to 8 percent of revenue, depending on how much the tribes take in.

Bales told Ryan on Tuesday that any delay signing compacts would result in the state losing out on all first quarter revenue -- an estimated $20 million -- generated by casinos.

Currently the state gets no money from the 22 casinos run by 15 tribes in Arizona.

Racetrack attorney Neil Wake has argued that since Arizona law declares certain types of gambling illegal, the state should not be allowed to profit from illegal activities occurring on sovereign nations' lands.

He said Proposition 202 violates the state Constitution by granting tribes monopoly gambling powers and privileges not awarded to the general public.

Indian gambling is "not a license or franchise for Indians but a racially defined prohibition and no such matter has been before this court," Wake told Ryan.

Racetrack owners had sought to add slot machines to their facilities, but voters rebuffed the effort, soundly defeating an initiative that would have allowed slots at tracks.

Proposition 202 officially became law on Monday after the governor signed off on the election.

However, Hull was waiting for U.S. District Judge Robert Broomfield to give her the OK to sign new agreements with Indian tribes.

Broomfield had essentially sided with the tracks in another case last year, ruling that Hull couldn't sign compacts without the approval of the state Legislature. But a federal appeals court overturned Broomfield and the judge threw out his ruling Tuesday.

"It is great news that the Arizona Supreme Court has reaffirmed my authority as governor to negotiate and sign Indian gaming compacts," Hull said in a statement. "I am pleased that the Supreme Court refused the racetracks' request to stop me from signing compacts, and that Judge Broomfield has cleared the final hurdle, all on the same day."

Hull has 30 days to sign gambling agreements under the provisions of 202. The compacts will be valid when six tribes -- the Fort McDowell, Salt River Pima Maricopa, Gila River, Pascua Yaqui, Tohono O'odham and Ak-Chin -- sign off on the agreements, which will replace existing compacts.

The compacts then go to the Interior Department, which checks to ensure the agreements comply with federal law. Only after that would the compacts become effective.

Hull will likely be ready to sign compacts in the next week, Bales said.

Indian casinos first became legal in Arizona in 1993 when then-Gov. Fife Symington signed agreements with several tribes. The first of those agreements are set to expire in August.