SACRAMENTO — A major fight over the future of gambling in California began taking shape Wednesday, as Gov. Arnold Schwarzenegger tapped a negotiator to extract more from Indian gambling revenue and tribes prepared to fight back -- and to battle an initiative that would end their monopoly on Nevada-style casinos.
The governor appointed attorney Daniel Kolkey, 51, to renegotiate the state's gambling agreements with tribes that own casinos. Kolkey butted heads with tribes as Gov. Pete Wilson's chief counsel in the late 1990s, when the Republican fought their demands for casinos of unlimited size.
The appointment came a day after Schwarzenegger reiterated in his State of the State speech that he wanted more from the casinos to help balance California's budget.
Meanwhile, half a dozen tribes agreed to ante up $1.5 million each to derail a proposed November ballot measure that would allot 30,000 slot machines to racetracks and card rooms, according to a memo describing tribes' early anti-initiative plans.
The memo, which details a private strategy meeting, says they will fight the measure, sponsored by competing gambling interests, by marshaling their forces into a single campaign. The memo does not include a budget for the campaign.
But the tribes have hired high-profile political consultants Dan Schnur, a Republican and former top aide to Wilson, and Garry South, a Democrat who was chief strategist for former Gov. Gray Davis. The tribes also plan to retain law firms to challenge the measure's constitutionality, the memo says.
Kolkey said Wednesday that he intended to renegotiate many components of the deal that Davis struck with the tribes in 1999. Later ratified by voters, that agreement opened the way for a major expansion of gambling on Indian land but required tribes to make only modest payments from casino profits.
"Clearly, we think the current compacts do not provide for fair payment to the state in return for what is a monopoly," Kolkey said in a telephone news conference.
During the recall campaign in which he ousted Davis, Schwarzenegger declared that tribes should pay as much as 25% of their revenue to the state -- which could amount to $1.25 billion a year.
Tribes with casinos spent more than $10 million trying to block Schwarzenegger's election, putting the bulk of their money behind Lt. Gov. Cruz Bustamante and state Sen. Tom McClintock (R-Thousand Oaks).
