Pojoaque Pueblo to pay in lawsuit with state

Mary Perea

Tuesday, July 12, 2005 | 9:25 a.m.

ALBUQUERQUE -- Pojoaque Pueblo has agreed to pay $24 million in back casino payments to settle a lawsuit filed by the state, becoming the last tribe in New Mexico to settle the gambling dispute.

Attorney General Patricia Madrid, who announced the settlement at a news conference here Monday, sued New Mexico tribes that operate casinos five years ago. She alleged they were violating a 1997 gambling compact that required them to pay 16 percent of their net slot-machine revenue to the state in exchange for limits on gambling competition.

All the tribes except Pojoaque eventually settled. Revised gaming compacts, approved in 2001, require the tribes to pay no more than 8 percent of their slot revenue. Those revenue sharing agreements meant more than $38 million for the state last year alone.

"With this settlement, we bring the legal case of the state versus our Indian gaming tribes to a successful close," Madrid said.

Under the agreement, Pojoaque will sign the 2001 compacts for its Cities of Gold Casino and begin paying the 8 percent immediately. The $24 million in back pay will be paid in installments beginning with $1 million per year for three years, then $2 million per year thereafter. The state expects that sum to be paid off in about 12.5 years.

The consent decree still must be approved by U.S. District Judge Bruce Black, who is out of his office until Wednesday. Madrid said she did not expect a problem with Black signing off on the settlement.

Pojoaque Pueblo Gov. George Rivera said the pueblo decided to "bury the hatchet."

"I know that the lawsuit wasn't decided. There is no resolution on whether revenue sharing is legal," Rivera said.

"The compact protects my people's future and our local economy," Rivera said. "I thank the attorney general for the consent decree, even though there will be cutbacks."

Rivera signed the settlement on Friday, and Madrid signed it Monday.

Madrid praised Rivera for his leadership. "He has been very good to work with, and cooperative," she said.

Madrid could not say exactly how much Pojoaque owed, but "we believe this is fairly close."

Special counsel Chris Coppin said the amount owed was likely somewhere around $30 million, but it was impossible to give an exact figure because no audit had been done of the casino.

A number of securities were worked into the agreement to ensure cooperation by the pueblo.

The pueblo has secured a $5 million letter of credit with a bank that will be paid to the state if the pueblo is late in making its back payments.

If the pueblo does not make the payments, it can also be held in contempt of court, Coppin said.

Gov. Bill Richardson said both the pueblo and state had suffered from mounting legal costs and "chilled relations.

"I hope that now we can put this contentious litigation behind us and work to restore our government-to-government relations with the pueblo," Richardson said.

Early last year, Pojoaque offered to write the state a _$9 million check and begin paying a cut of casino profits to settle the case, but Madrid refused the offer.

In February, she asked the federal court to rule in the state's favor without a trial and order Pojoaque to pay up or be shut down.

Former pueblo Gov. Jacob Viarrial, who died in June 2004, began the dispute by questioning the legality of the Indian gaming compacts. In 1995, he even threatened to install toll booths along U.S. 84-285 through the pueblo to make up for lost revenue if the state closed the casino.

Rivera, Viarrial's nephew, became governor after Viarrial's death.

Pojoaque also owns The Downs at Santa Fe horse track, which it purchased in 1996. The pueblo submitted an application in March to the New Mexico Racing Commission to reopen the track.

The commission said it would not act on the track application until the lawsuit was cleared up.

Madrid said the track was not factored into the agreement, but the pueblo risked other difficulty in moving forward with its developments, which include a golf course and resort.

If it had lost in court, the state could have risked losing the money casinos had paid up until the 1997 compacts were challenged, which was about $64 million.