Garcia: Casino revenue no sure bet

California has long been engaged in its own big spin — as in downward — so our contention that the state has become overly dependent on revenue from casino gambling received some powerful backing this week.

That would be the decision by a federal appeals court in San Francisco that the state’s desire for American Indian tribes to share gambling revenue to offset the budget deficit is prohibited by federal law. And, yes, that was an unearthly groan you heard coming from the Governor’s Office.

Gov. Arnold Schwarzenegger was on a roll for several years, signing new compacts with Indian tribes to expand the size and scope of casinos throughout the state in light of California’s deepening fiscal problems. The selling point to voters and lawmakers was that it was an easy way for the state to pull in dough, with little harm from inking the deals.

So while the economy revved and people still had money to toss on the roulette table, it seemed a reasonable trade-off. But some Indian tribes objected, saying the shared revenue amounted to a federal tax, one that the Rincon Band of Luiseno Mission Indians in San Diego maintained it could no longer afford.

The Rincon Band signed a 20-year compact in 1999 and when the tribe proposed expanding the number of slots at its casino four years later, Team Schwarzenegger demanded the increase in revenue would be steered to the general fund. The tribe sued and, by a 2-1 ruling, the 9th U.S. Circuit Court of Appeals said the state’s action is akin to imposing a tax and that it can’t put “casinos up for sale to the tribe willing to pay the highest price.’’

And a high price is what California stands to lose if the ruling is not overturned, since the state was hoping to get about $38 million from the casino-expansion revenue. The other tribal compacts negotiated with the state were expected to generate about $380 million for the general fund.

The Governor’s Office has vowed to appeal, and there may be a small ray of hope for the state since, in a dissenting opinion, Judge Jay Bybee said the ruling would invite all the other tribes to drop their own revenue agreements.

But one thing that’s clear from the ongoing court case is that the whole strategy of linking California’s financial future with casino revenue remains a huge gamble.

Legalization bill leaves a whole lot up in the air

California may be about to light up the ballot booth with a pot-legalization measure this year, but the rest of the country does not share its apparent desire to bring marijuana to the family room.

According to an Associated Press-CNBC poll, only 33 percent of those who responded to a national survey favored legalization while 55 percent opposed it. Young voters were more likely to support it and older people were likely to oppose it.

And the strongest groups against legalization were women and Republicans. So can we trust those statewide polls that suggest California voters are ready to roll out the wagons for tax-and-burn pot dispensaries? Without any formal campaign against the November initiative, it’s hard to read the cannabis leaves.

One aspect of the pro-pot debate that has hardly been covered is that it will be up to local governments, not the state, to authorize the cultivation and sale of marijuana and to impose their own taxes. Given how many municipalities have no idea how many pot clubs are operating within their boundaries, that’s sure to pose a considerable challenge.

Still, it remains hard to believe that pot dealers want to share their stash with the Internal Revenue Service in what has been a carte blanche cash-heavy industry. And there’s the conflict in places like San Francisco, which has passed some of the toughest anti-smoking laws in the country. Are there exceptions to the rule about smoking being bad for you?

Transit hub will be awesome – if it’s built

Three years after the futuristic vision of the new Transbay Transit Center was outlined, the completed design was unveiled this week in all its $1.2 billion glass-encased glory. And we have to admit it looks very cool and we can’t wait for the next 10 years or so, until it maybe, possibly gets built.

But it does raise one thought: Will Muni be able to provide buses to the terminal? Here’s an agency that can’t even come up with a realistic annual budget, let alone see a time when fast new bullet trains will be whizzing into downtown San Francisco. And when you couple the terminal with plans for the $1 billion Central Subway, well, it’s like transportation overload.

The new terminal, we’re told, will be structured to withstand a 7.9-magnitude earthquake like the one that leveled The City in 1906. That’s probably the one thing we can count on.

Case of the missing iPhone reveals Apple’s serious side

The great iPhone-caper case in which a next-generation model was found and purchased by the backers of a tech website showed that the Bay Area is frighteningly tech-obsessed and Apple Inc., the maker of all i-things, has no sense of humor.

Of course, it also allows us to track the future of the 27-year-old engineer who apparently left the device in a Redwood City bar knowing that he will likely never be trusted to test Apple products for the rest of his 4G life.

For those of you still bleary after overdosing on mock NFL-draft boards this week, a prototype of the next iPhone found its way to the website Gizmodo’s geek squad, where it was pored over, analyzed and photographed in a way in which few things are.

Apple was not amused, to the point that its general counsel sent a letter to the Web editors demanding a return of the device, which authenticated its missing status to the world.

Conspiracy theorists now suggest that maybe the Cupertino company “planted” the phone as a marketing ploy. To which we say: In a Redwood City bar?

Bay Area NewsNews ColumnistsOp EdsPotTransbay Transit Center

If you find our journalism valuable and relevant, please consider joining our Examiner membership program.
Find out more at

Just Posted

Passengers board a BART train bound for the San Francisco Airport at Powell Street station. (Kevin N. Hume/S.F. Examiner)
BART bumps up service restoration to August 30, offers fare discounts

Rail agency breaks pandemic ridership records, prepares to welcome more passengers

Gov. Gavin Newsom, show here speaking at the City College of San Francisco mass vaccination site in April, faces a recall election due to anger on the right over his handling of the pandemic, among other issues. (Kevin N. Hume/S.F. Examiner)
Why Gavin Newsom’s popularity could work against him in the recall election

Top pollster: ‘We’re not seeing the Democrats engaged in this election. And that may be a problem…’

Passengers ride the 14-Mission Muni bus on Friday, March 12, 2021. (Jordi Molina/Special to S.F. Examiner)
Transit officials fear Free Muni pilot could hurt already-strained service levels

Supporters say fare cuts could increase ridership, help low-income residents

The vacant property at 730 Stanyan St. in the Haight currently houses a safe sleeping site for the homeless. <ins>(Kevin N. Hume/S.F. Examiner)</ins>
Affordable housing project on former McDonald’s site delayed as city adds units

The start of construction on an affordable housing project on the site… Continue reading

SF expands COVID-19 vaccine eligibility to minors 12 and up

San Mateo County also preparing to begin vaccinating kids next week

Most Read