Temecula is still awaiting a $2 million payment from the Pechanga Band of Luiseño Indians as part of an agreement intended to offset the tribal casino's effects on city services.

The city might have to dip into reserves if it doesn't receive the money, Mayor Jeff Comerchero said Tuesday. The matter could come up during next Tuesday's City Council meeting.

The annual payment, due June 30, is part of a long-term agreement between the tribe and city ratified by the council in March. The tribe and Pechanga Resort & Casino are on a federally established reservation bordering the city.

In an e-mail, tribal Chairman Mark Macarro said the tribe's agreements with the city and Riverside County are "interdependent."

"The county component has yet to be completed and is still in negotiation, thus the agreement with the city has not yet been finalized. The agreement is quite clear about this," he said.

"Although we had all hoped that agreement with the county would have been reached by now, we believe we are making progress. The payments to the city will begin when the county agreement is complete."

Tribe, county talking

Talks between the tribe and county officials continue, county spokeswoman Lys Mendez said.

Macarro added that the agreement "is intended to mitigate reasonable off-reservation impacts, not solve government budget deficits."

While Comerchero said he understood the tribe's position regarding its talks with the county, "We have an agreement that's in place, and we'd like to get paid."

The city's new fiscal year began July 1 with a $54.4 million operating budget. Unless the city gets the $2 million soon, officials might have to dip into a $7.8 million secondary reserve fund, Comerchero said.

from previous project

The fund consists of money left over when the civic center being built in Old Town cost less than expected. Temecula also has a separate, $10.8 million reserve fund.

The tribe was required to negotiate directly with the city as part of a state gaming compact that allowed the casino to have up to 7,500 slot machines. It now has 4,200.

The agreement ending Dec. 31, 2030, is meant to mitigate the traffic and other impacts generated by the 200,000-square-foot gaming center, 522-room hotel and related facilities.

The pact calls for the tribe to pay $2 million a year for the first five years, with subsequent payments adjusted for inflation. The tribe also is supposed to pay $10 million or help secure federal funding for improvements to the Interstate 15/Highway 79 South interchange.

Comerchero downplayed the notion that the payment delay would harm relations between the city and tribe.

"I certainly would hope not," he said. "We've strived for good relations in the past, and we'd like to see that continue."

Reach Jeff Horseman at 951-375-3727 or jhorseman@PE.com