Indian gaming a golden opportunity for gambling industry suppliers

Now, as tribal leaders anxiously await court rulings on challenges to the law and quietly communicate with the new Indian-friendly governor about rewriting gambling compacts, key players in the budding industry are converging on Palm Springs to talk about the changes.

"California is the most exciting new U.S. market to emerge in many years," said Matt Connor, editor of Indian Gaming Business. "The California Indian Gaming Summit provides a unique opportunity for operators, managers and suppliers to get in on the ground floor of the potentially enormous market."

The summit is the first of its kind in California and will be the first formal opportunity for the many people affected by Proposition 5's passage to exchange ideas, network and plot strategy. Proposition 5 was touted as key to the economic survival of impoverished Indians, while opponents used ominous TV ads to warn of the expansion of unregulated gambling across the state.

Critics point to this week's summit as proof that gambling will spread under Proposition 5, if the courts uphold it. During the campaign, tribes denied any plans to expand, saying Proposition 5 -- approved by 63 percent of voters -- was simply a way for them to continue operating existing casinos.

State and federal officials had moved to shut down those casinos because the tribes were operating forms of gambling that authorities said were illegal in California and because the tribes didn't have gambling compacts with then-Gov. Pete Wilson, as required under the Indian Gaming Regulatory Act.

The California Indian Gaming Summit was the brainchild of the Gaming Entertainment and Media Services Co., which publishes several gambling magazines and organizes the World Gaming Congress & Expo, and some of GEM's clients. About 120 people paid $500 in advance and organizers expect as many as 80 more delegates to show up at the door.

California tribal leaders will spend three days talking about everything from employee training to political empowerment with Indians from across the country. Manufacturers of gambling equipment, regulatory officials and even some Nevada casinos executives will be looking to tap into the market.

"What really are the challenges? Even once you have a compact and everything is approved, what do you do afterward? How do you pick the employees; how do you pick a management company," asked Andrea M. Schatz, GEM spokeswoman.

The new chairman of the National Indian Gaming Commission, the national regulatory body for Indian gambling, is scheduled to speak at the summit Tuesday, followed by tribal leaders, consultants and other NIGC members.

It was not immediately known if anyone from Gov. Gray Davis' staff would attend. Davis has said he will uphold Proposition 5 and wants to negotiate agreements with Indian tribes on the scope of reservation gambling. If the court challenges succeed, they could limit the tribes' ability to negotiate expanded gambling with Davis.

After taking office last month, Attorney General Bill Lockyer filed papers on behalf of Davis, taking a neutral position on the validity of Proposition 5 in two lawsuits pending before the state Supreme Court. A group of citizens who fear the spread of gambling in their neighborhoods filed one lawsuit, and a labor union that wants tribes to let unions organize at casinos filed the other.

Pro-gambling tribes were major contributors to both Davis' and Lockyer's campaigns.

The previous attorney general, Dan Lungren, had submitted arguments by his predecessor, Dan Lungren, expressing former Gov. Pete Wilson's view that the initiative violated the state Constitution. Wilson refused to negotiate on additional gambling devices that most tribes wanted.

One of the lawsuits is supported financially by Nevada casinos, the chief bankrollers of the No-on-5 campaign. The opposition coalition spent $25.4 million on their election campaign, while Indian tribes shelled out $63.2 million.

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