Thursday, Aug. 4, 2005 | 9:07 a.m.
SACRAMENTO -- One week after accepting a $50,000 donation from a partner in a tribal casino project, Gov. Arnold Schwarzenegger's political committee said Wednesday it would return the money after questions were raised about the donation by the Associated Press.
Schwarzenegger made a promise during the 2003 recall campaign not to accept campaign contributions from groups that negotiate directly with his office -- specifically identifying tribal gambling as one of those special interests.
Last week at a birthday celebration fundraising event in Yuba City, the governor received a $50,000 contribution from Yuba County Entertainment LLC, a partner in a proposed hotel and casino development south of the town of Olivehurst.
Although company officials said Wednesday that the donation was intended to support the governor's political agenda in the upcoming special election -- not the casino project -- a top political aide to Schwarzenegger said the money would be returned promptly.
"After reviewing the nature of the business and realizing there is a connection to a potential Indian gaming location, we feel it is most appropriate to return the funds," said Marty Wilson, who oversees fundraising for Schwarzenegger's California Recovery Team.
Alan Waskin, senior vice president and general counsel of Yuba County Entertainment, said the company is a subsidiary of Indeck-Forsythe, a private auto racing firm based in Chicago that has a variety of business interests in California, including the Yuba County casino project.
"The purpose of the donation was not to primarily back the governor but to back his initiatives that we think are important to the business community," Waskin said.
The company's tribal partners, the Enterprise Racheria, formerly known as the Estom Yumeka Maidu tribe, have been trying for several years to get federal and state approval for the resort project.
The casino plans are currently before federal regulators and need their approval before moving forward. But, if federal approval is given, the tribe would eventually also need to negotiate a gambling compact with the governor's office to open the casino.
Even though Schwarzenegger has said he will return the money, some critics point out that he should never have taken such a donation in the first place.
"It just shows that the governor's fundraising is on automatic pilot," said Jamie Court, president of Santa Monica-based Foundation for Taxpayer and Consumer Rights. "Only when there's a spotlight cast on his activities will he ever think about returning the money."
The contribution came at a $250 ticket event at a downtown Yuba City restaurant on July 29 that drew both supporters and protesters -- including some opponents of the proposed casino.
The casino proposal received a boost Tuesday by the Yuba County supervisors who voted unanimously to place on the special election ballot an advisory measure calling on voters to weigh in on the proposal.
Waskin said that if the measure is approved it will fulfill one of the governor's requirements that the casino get the backing of local residents. He said he is hopeful that the tribe would eventually have a plan that could be taken to the governor for approval.
Schwarzenegger's stand on accepting campaign money from special interest was first established on the very day he announced his candidacy during an appearance on the "The Tonight Show." Noting that his acting career and business success had made him independently wealthy, he said he did "not need to take money from anyone."
Only a few weeks later, however, when Schwarzenegger began accepting donations from land developers, high-tech companies and other big corporations he clarified his position as to exclude only sources of money that came from groups -- particularly unions and tribal gambling organizations -- that would negotiate directly with the governor's office.
"I think it's good to have all these interests fighting for their causes," he said in a 2003 interview. "What I am saying is you cannot expect to represent the people of California if you are taking money from a union, and you know that down the line you are going to sit across the table from them."
Questions were also raised about a year ago over whether the governor had broken his promise not to take tribal money. Casino operators and Sacramento Kings owners Gavin and Joe Maloof had organized a fundraising event for Schwarzenegger that generated about $1 million in donations.
At that time, the Maloofs were in talks with the Lytton Band of Pomo Indians about the family taking a management role in the tribe's proposed casino in the East Bay community of San Pablo.
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