Compacts could offer windfall for suppliers

Friday, Aug. 27, 2004 | 10:37 a.m.

Four tribes that signed new casino compacts with the state of California in June are expected to order up to 1,500 or so slot machines over the next several months to update and expand their slot floors, according to an attorney for the tribes.

Most of those machines will be made by International Game Technology, said Howard Dickstein, a Sacramento attorney who helped negotiate the compacts on behalf of the tribes. Reno-based IGT is the world's largest slot maker as well as the nation's largest supplier of gambling devices for tribal casinos.

California Gov. Arnold Schwarzenegger, the California Legislature and the U.S. Bureau of Indian Affairs have approved casino deals with the Pala Band of Mission Indians, Rumsey Band of Wintun Indians, United Auburn Indian Community, Viejas Band of Kumeyaay Indians and Pauma Band of Mission Indians.

The Pauma tribe, which has plans to build a major casino in place of its small property, isn't placing orders for machines at this time, Dickstein said.

The agreements call for tribes to pay slot machine fees to the state in exchange for lifting a previous cap of 2,000 slots per tribe. The tribes would pay from $8,500 to $25,000 per year for each machine they add.

"Probably less than half" of the new slots will be operational in the next few weeks, Dickstein said.

A more significant increase in slot machines could be further ahead as tribes build onto their casinos, he said.

"Any substantial increase awaits the verdict of the market," he said.

IGT Vice President of Marketing Ed Rogich said the company can't confirm sales of any slot machines because it hasn't received any signed orders yet.

The company is discussing orders with the tribes, Rogich said. Orders typically take from eight to 14 weeks to process, he said.

Representatives of Alliance Gaming Corp. of Las Vegas, also among the nation's largest slot makers, could not be reached for comment on orders from California casinos.

Nevada slot makers have previously said that California won't be an immediate gold mine because of the uncertainty related to the approval of tribal compacts.