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TEMECULA: City seals $42 million with Pechanga

By AARON CLAVERIE - The Californian | Posted: March 17, 2010

The Pechanga Band of Luiseno Indians will pay Temecula at least $42 million over the next 21 years to help the city pay for road improvements and police and fire contracts, costs that are expected to be higher due to the recent addition of slot machines at the tribe's casino.

The deal, approved recently by the Temecula City Council, was the result of more than a year of negotiations that were spurred by the passage of Proposition 94 in 2008, a measure that changed how the tribe pays the state to offset the local impacts associated with its casino operations.

In the past, the Pechanga paid into the state's Special Distribution Fund, a pot of money was divvied up by the counties and governmental agencies affected by Indian casinos.

The proposition changed the formula for the Pechanga, requiring the tribe to negotiate directly with Temecula and Riverside County.

Putting the agreement in context, Councilman Ron Roberts, one of the city's lead negotiators, said it was a monumental task trying to get a pact of this magnitude completed.

"That's 20 years," he said, talking about the parameters of the deal. "It's almost unheard of to go ahead 20 years."

Approval of Prop. 94 allowed the Pechanga tribe to operate up to 7,500 slot machines on its land, a substantially higher number than the previous cap of 2,000.

To help address the effects on the area of adding that many machines ---- traffic, public safety costs, pollution from the added traffic, etc. ---- the fine print of the proposition required the tribe to enter into an "enforceable agreement" with a neighboring city or the county in which the tribe's lands are located.

As of this year, the Pechanga operate about 4,200 slot machines in its casino. The deal with the city allows up to 5,000.

If the tribe decides to grow beyond 5,000 machines or it decides to expand the size of the casino by more than 10 percent, the tribe has agreed to prepare a "tribal environmental impact report," a document that would detail the proposed expansion's affect on the environment.

If the city has any issue with the tribe's report, the two sides have agreed to have the problem settled in arbitration.

Also, the tribe has agreed to pay up to $10 million within five years to help the city pay for the new interchange at the intersection of Temecula Parkway and Interstate 15.

Roberts said that aspect of the agreement is key.

"That will be the time, right in that period, when we will need that money to complete the project," he said.

Roberts said the negotiations took a long time due to the lack of any guidelines handed down from the state.

For instance, the city and the Pechanga and the tribe settled on $2 million a year, a nice round number, but the total could have been $3 million or $1.5 million.

City Attorney Peter Thorson, one of the architects of the deal, said the $2 million a year figure was not pulled out of thin air. He said it was reached after the city put together estimates on what Temecula would need to handle the city's expenses associated with the additional slot machines.

And the money for the interchange was vitally important.

"That's the missing link in funding," he said.

Pechanga Tribal Chairman Mark Macarro said in a statement that the agreement is the latest in a history of projects the tribe has undertaken with the city in "the spirit of community and cooperation."

Call staff writer Aaron Claverie at 951-676-4315, ext. 2624.



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