Tuesday, June 29, 2004 | 9:04 a.m.
BLOOMBERG NEWS
SAN DIEGO -- A California Indian tribe that owns a Harrah's casino near San Diego sued Gov. Arnold Schwarzenegger, seeking to block agreements with rival casino-operating tribes that eliminate a ceiling on how many slot machines they can run.
The Rincon Band of Luiseno Mission Indians said in a suit filed in U.S. court in San Diego that the compacts would break existing agreements the tribe has with the state. Rincon said the agreements would hurt its business by allowing competitors with casinos closer to Los Angeles and San Diego to add more than 2,000 slot machines.
"The new compacts would destabilize the limited market established by the existing compacts, defeating the tribe's investment-backed expectations, rendering its new facility virtually worthless, and destroying the opportunity to achieve the promise of self-sufficiency held out by the original compacts," the tribe said in the motion, which spokeswoman Joanna Farasati said was filed Monday.
Schwarzenegger, who as a candidate vowed he would help end the state's budget deficit by having Indian tribes contribute more from gambling revenue, last week said five tribes agreed to pay $1 billion next year in exchange for the right to operate as many slot machines as the market will bear.
The Pala, Pauma and Viejas tribes of Southern California were among those signing the new agreements, which must be approved by the state Legislature and the U.S. Interior Department.
The Rincon tribe owns a casino with 1,600 slot machines that is run on its behalf by Las Vegas-based Harrah's Entertainment Inc.
Vince Sollitto, a spokesman for Schwarzenegger, said the lawsuit was "without merit" and infringes upon the sovereignty of tribes in their negotiations with the state. Schwarzenegger last week said his administration is renegotiating compacts with 10 other tribes. More than 60 California tribes have gambling agreements.
"It is a disappointing and disturbing assault on the sovereignty of other nations," Sollitto said. "We hope a judge will quickly dispose of it."
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