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California Governor Arnold Schwarzenegger was dealt a serious blow in his attempt to gain revenue for the state by cutting into tribal casino profits.
According to a three-judge panel of the appeals court, the state can not ask Indian casinos for money for the California’s general fund without offering something of value in return. The court says that would be an illegal tax.
The governor hope to be able to help repair the state’s budget problems by using some sort of revenue sharing plan when negotiating with tribes wanting casinos in California.
The court upheld a 2008 ruling by a federal judge in San Diego that Schwarzenegger bending the law in his negotiations with North County’s Rincon Indian band.
“This is a great, big message to the state,” Rincon Chairman Bo Mazzetti said. “Your days of trying to bully tribes around are over.”
The state is expected to seek to have the case reviewed by a larger panel of 9th Circuit judges or even the U.S. Supreme Court.
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