HomeMy Public PortalAbout04-20-2004LPFAThis Agenda contains a b#ef general description of each item to be considered. Copies of the Staff
reports or other wrfften documentation relating to each item of business referred to on the Agenda are on
file in the Office of the City Clerk and are available for public inspection. A person who has a question
concerning any of the agenda items may call the City Manager at (31 O) 603-0220, ext. 200.
Procedures for Addmssin,q the C(~uncll
IN ORDER TO EXPEDITE CITY COUNCIL BUSINESS, WE ASK THAT ALL PERSONS WISHING TO
ADDRESS THE COUNCIL FILL OUT A FORM PROVIDED AT THE DOOR, AND TO TURN IT IN TO
THE CITY CLERK PRIOR TO THE START OF THE MEETING. FAILURE TO FILL OUT SUCH A FORM
WILL PROHIBIT YOU FROM ADDRESSING THE COUNCIL IN THE ABSENCE OF THE UNANIMOUS
CONSENT OF THE COUNCIL.
AGENDA ITEMS ON FILE FOR CONSIDERATION
AT THE REGULAR MEETING OF
THE LYNWOOD PUBLIC FINANCI~ AUTHORITY
TO BE HELD ON APRIL 20, 2004
6:00 P.M.
COUNCIL CHAMBERS
11330 BULLIS ROAD, LYNWOOD, CA 90262
LOUIS BYRD
PRESIDENT
LETIClA VASQUEZ
VICE PRESIDENT
IVED
CITY OF LYNW00D
CITY ~.l F~'~'q t3FFICE
FERNANDO PEDROZA
MEMBER
MARIA T. SANTILLAN
MEMBER
RAMON RODRIGUEZ
MEMBER
CHIEF ADMINISTRATIVE OFFICER
LORRY HEMPE
FINANCE DIRECTOR
ALFRETTA EARNEST
SECRETARY
ANDREA L. HOOPER
CITY TREASURER
lEIS PYGA'~I'
OPENING CEREMONIES
CALL TO ORDER
ROLL CALL OF MEMBERS
Femando Pedroza
Ramon Roddguez
Mafia T. Santillan
Leticia Vasquez
Louis Byrd
CERTIFICATION OF AGENDA POSTING BY SECRETARY
PUBUC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
PUBLIC ORAL COMMUNICA'F~ONS
IF AN ITEM IS NOT ON THE AGENDA, THERE SHOULD BE NO SUBSTANTIAL DISCUSSION
OF THE ISSUE BY THE LYNWOOD PUBLIC FINANCE AUTHORITY, BUT IT IS ALL RIGHT
FOR THE LYNWOOD PUBLIC FINANCE AUTHORITY MEMBERS TO REFER THE MATTER TO
THE STAFF OR SCHEDULE SUBSTANTIVE DISCUSSION FOR A FUTURE MEETING.
(The Ralph M. Brown Act, Government Code Section 54950-54962, Part III, Para~.vh 5.)
CONSENT CALENDAR
MINUTES OF PREVIOUS MEETINGS:
NONE
5. GAMING REVENUE ACT OF 2004
Comments:
The purpose of this item is to inform the President & Members of the Authority of a ballot
initiative currently being circulated that could provide additional funding to local
governments.
Recommendation:
Staff recommends that the President & Members of the Lynwood Public Finance Authority
receive and file this item.
ADJOURNMENT
THE NEXT REGULARLY SCHEDULED MEETING WILL BE HELD ON MAY 4, 2004 AT 6:00
P.M., IN THE COUNCIL CHAMBERS OF THE CITY HALL, 11330 BULLIS ROAD, CITY OF
LYNWOOD, CALIFORNIA.
DATE:
TO:
FROM:
BY:
SUBJECT:
20, 200
HONORABLE PRESIDENT AND MEMBERS OF THE LYNWOOD PUBItC
FZNANCE AUTHORT[Y
Lorry Hempe, Chief Administrative Officer'~
Autra C. Adams, Special Assistant~Intergovemmental Relations
Gaming Revenue Act of 20D4
PURPOSE:
The purpose of this item is to inform the President & Members of the Authority of a
ballot initiative currently being circulated that could provide additional public safety
funding to local governments.
BACKGROUND:
Existing law within the State of California permits certain types of gambling. Wagering
on horse races and specified games in licensed card rooms are allowed. Additionally,
Indian tribes with tribal-state gaming compacts are authorized to operate slot machines
and other casino-style gambling.
ANALYSZS:
The Gaming Revenue Act of 2004 authorizes the Governor to renegotiate ~bal-state
compacts to require that tribes share 25% of their revenues with the State for allocation
through the Gaming Revenue Trust Fund. NI tribes currently with a compact would
have to agree to specific conditions contained within the initiative. Specifically, this
would include agreement to be bound by state court judgments and compliance with the
California Environmental Quality ACt. Nso, the tribal govemments would have to agree
to make their books public and be subject to audits by the State Gambling Control
Commission.
The initiative also includes a provision wherein if the tribal govemments do not reach
such an agreement within 90 days of approval of the initiative by the voters, then
certain racetracks and card clubs would be authorized to operate 30,000 machines
statewide at site specific locations, including five specified racetracks and eleven
specified card clubs throughout the state. Under this scenario, 33% of the revenue
generated from the gambling activities of the racetracks and card clubs would be
allocated as follows: 30% would be paid to the Gaming Revenue Trust Fund, 2% to the
city in which they are located, and 1% to the county where they are located.
AGENDA
ITEM
Under both of the indicated scenarios revenue would be deposited into the Gaming
Revenue Trust Fund. This money would be di~bibuted as follows:
· $1.2 million to each non-gaming Tndian tribe
· $3 million for responsible gaming programs
· 50% of the remaining funds to county offices of education to provide services for
abused and neglected children in foster care
· 35% of the remaining funds to local govemments for additional neighborhood
sheriffs and police officers
· :t5% of the remaining funds to local govemments for addiUonal fireflghters
Proponents of the Act contend that redistribution of gaming revenue in the state is
critical to generating additional revenues for education, police protection and fire safety
in California. Proponents include Sheriff Lee Baca and Sheriff Lou Blanas (Sacramento
County).
Opponents of the Act contend that casino gambling cause serious threats to public
safety and that these threats outweigh the new revenue that will be generated. The
California Police Chiefs Association strongly opposes the Act.
Proponents of the Gaming Revenue Act of 200~ are currently circulating the initiative for
signatures and hope to have this initiative qualified for the November 200z[ statewide
election.
Impact on Lvnwood
Nine of the eighteen locations that are being proposed under the second scenario are
located within Los Angeles County and are within a close proximity to the City of
Lynwood.
Based upon estimates provided by proponents of the initiative, under the first Scenado
(a renegodation of current tribal-state compacts) Lynwood would receive approximately
$1.2 million annually for additional public safety services. Under the second scenado
(allowing racetracks and card clubs to operate slot machines) Lynwood would receive
approximately $2 million annually for additional public safety services.
RECOMMENDA'I'~ON:
Staff recommends that the President & Hembers of the Lynwood Public Rnance
Authority receive and file this item.
A'I-FACHMENT
03-~-=-04P04: ;3 ~ ~
Mar~h 5, 2004
City Manager Lorry Hempe
City of Lynwood
11330 Bullis Road
Lynwood, CA 90262
Dear City Manager Hempe:
As leaders of law enfomement weighing the pain of stalTand service cutbacks in our own
depmh,ents, we are sadly all too familiar with the challenges facing local communities because
of California's fiscal crisis. It is also why we are supporting the Gaming Revenue Act of 2004
that is expected to be on the November ballot.
If approved by the voters, the initiative would provide more than $1 billion dollars per year to
local California communities to put new police, sheriffs and firefighters on the job and to educate
neglected and abused children. The revenue would be generated by either gaming tribes
agreeing to provide 25% of their slot machine wivnings or, if they don't agree, allowing slot
machines in 16 designated card clubs and racetracks across the state with 33% of those winnings
going to local communities.
A recently completed study by Dr. William Harem, the former Legislative Analyst, estimates
how much revenue would flow to each California city and county if this initiative passes. The
revenue will be distributed on a per capita basis across the state.
If card clubs and racetracks are allowed to operate machines, cities and counties where the
machines are located will receive an additional 2% and 1% of the wlnniqgs respectively.
According to Dr. Hamm's estimates, the City of Lynwood couM receive as much as
$2,032,281 annually.
This is a win-win financial situation for public safety, education and more important, your city-
without placing further tax burdens on residents.
Ir'you have questions or would like further information, please feel flee to contact Sophia
Cazanis at (916) 491-4094.
Sincerely,
Sheriff Lou Blanas
Sacramento County
Sheriff Lee Baca
Los Angeles County
171718treet, S~u:ramento, OAg5814 916.5B1.2538 C~#oml~forl~ul~lcSa~t~ln{IEdacallon Sul30~tt~byHorseRac~ngandC~lClu~ ~C..a~n. IDNo1260733
~,.
THE GAMING REVENUE ACT OF 2004
SECTION 1. Title.
This Act shall be known as and may be cited as "The Gaming Revenue Act of 2004."
This Act may also be cited as "The Gaming Revenue Act" or the "Act."
SECTION 2.
Findings and Purpose.
The People of the State of California hereby make the following findings and declare that
their purpose in enacting this Act is as follows:
(a) California now faces an unprecedented budget deficit of billions of dollars that
particularly threatens funding for education, police protection, and fire safety. As a result of
California's budget crisis, the State needs to find new ways to generate revenues without raising
taxes. In March 2000, Proposition lA was enacted, which triggered an unprecedented expansion
of Indian casino gaming, gave Indian tribes a monopoly on casino gaming, and has led to billions
of dollars in profits for Indian ~ibes, but little or no taxes to the State. Moreover, local
governments and communities have not been adequately protected, the State does not have
sufficient regulation and oversight of (a-ibal casino gaming, and tribal casinos have not complied
with state laws applicable to other businesses and designed to protect California citizens, such as
laws regarding the environment and political contributions. Gaming tribes also have failed to
fully fund a trust fund to promote the welfare of Indian tribes that do not operate large casinos.
Some Indian tribes have attempted to acquire land far away fi.om their reservations or traditional
lands to be used as casinos and not for usc as traditional reservations. Tribes have expended over
$120 million dollars in political contributions but have refused to comply with disclosure
requirements.
Co) California should request that all Indian gaming tribes voluntarily share some of
their gaming profits with the State that can be used to support public education, and local police
and fire services, and address other problems associated with tribal casino gaming, and in the
event all Indian gaming tribes do not do so, California should grant gaming rights to other
persons who will share substantial revenue with the State that can be used to support public
education, and local police and fire services.
(c) The Governor should be authorized to negotiate amendments to all existing
compacts with Indian tribes to allow these Indian ~ibes to continue to have the exclusive right to
operate gaming devices in the State of California if the Indian ~ibes agree to pay twenty-five
percent (25%) of their winnings fi.om such devices to a gaming revenue trust fund and agree to
comply with State laws, including laws governing environmental protection, gaming regulation
and campaign contributions and their public disclosure.
(d) In the event all Indian tribes with existing compacts do not agree to these terms,
five existing horseracing tracks and eleven existing gambling establishments, where forms of
legal gambling and wagering already occur, should have the right to operate a limited number of
gaming devices, provided they pay thirty-three percent (33%) of their winnings fi.om the
operation of such gaming devices to cities, counties, and a gaming revenue trust fund to be used
for education, and police and fire services, and provided they comply with strict legal
requirements on the operation and location of such gaming devices.
(e) In addition to paying substantial taxes, the owners of gambling establishments and
horseracing tracks authorized to operate gaming devices would have to be licensed by the State
Gambling Control Commission under the Gambling Control Act, which requires that they be
persons of good character, honesty and integrity, and persons whose prior activities, reputation
and associations entitle them to receive a license from the State.
(f) P~smitfing five existing horseracing tracks and eleven licensed gambling
establishments to operate gaming devices and requiring them to pay thirty-three percent (33%) of
their winnings from these gaming devices will generate revenues estimated to exceed $1 billion
annually. These funds will help alleviate California's dire fiscal crisis, which particularly
threatens funding for education, police protection and fire safety, and will help mitigate the
impact on cities and counties where gaming occurs.
(g) The Gaming Revenue Act will establish the Gaming Revenue Trust Fund, the sole
purpose of which will be to ensure that the revenues raised by tiffs Act are distributed in
accordance with the Act. The Act will also establish a Board of Trustees consisting of
individuals who are engaged in public school education, law enforccnient, and fire protection.
(h) The Gaming Revenue Act will provide funding for the existing Division of
Gambling Control and the existing California Gambling Control Commission for the purpose of
regulating gaming authorized by this Act.
(i) The Gaming Revenue Act will increase the monies distributed to non-gaming
Indian Tribes by guaranteeing that each such tribe will receive at least $1.2 million annually, and
will award $3 million annually to responsible gambling programs.
(j) The Gaming Revenue Act Trust Fund will dislribute fifty percent (50%) of the net
revenues directly to county boards of education to be used to improve educational services for
abused and neglected children and children in foster care.
(k) The Gaming Revenue Act Trust Fund will distribute thirty-five percent (35%) of
the net revenues directly to local governments for additional neighborhood sheriffs and police
officers.
(1) The Gaming Revenue Act Trust Fund will dis~ibute fifteen percent (15%) of the
net revenues directly to local governments for additional firefighters.
(m) The revenues generated for county offices of education for improving the
educational outcomes of abused and neglected children and children in foster care and local
governments for police protection and fire safety by this Act are not to be used as substitute
funds but rather shall supplement the total amount of money allocated for county offices of
education and local governments.
(n) Indian tribes have attempted to acquire land at locations off of their reservations
or distant Eom their traditional Indian lands to be used solely as casinos and not for use as
traditional reservations. Gaming on these newly acquired lands would be detrimental to the
surrounding communities. Therefore, the Gaming Revenue Act prohibits the location of gaming
establishments by Indian tribes on newly or recently acquired lands.
(o) In order to reasonably restrict the growth of non-Indian gaming, non-Indian
gaming authorized by this Act will be limited to the sites of five existing horseracing tracks
located in the counties of Alameda, Los Angeles, Orange and San Mateo, and the sites of eleven
existing gambling establishments located in the Counties of Los Angeles, San Diego, Contra
Costa, and San Mateo. To insure that there are no new gambling establishments other than those
in existence as of the enactment of the Act, the current limitation on the issuance of new
gambling licenses, which expires in 2007, will be made pm:,anent. The purpose of such
restrictions is to exercise control over the proliferation of gambling.
(p) The expansion of Indian gaming has led to conflicts between Ixibes and local
governments. In some cases, tribes have failed to take sufficient steps to address local concerns
and impacts. Therefore, this Act will authorize the Governor to negotiate amendments to all
existing compacts pursuant to which all tribes agree to enter into good faith negotiations with
county and city governments to address and mitigate community impacts.
(q) To clarify legal jurisdiction over Indian casinos, state courts should have
jurisdiction over any criminal or civil proceeding arising under this Act, under a compact, or
related to a tribal casino. Therefore, this Act will authorize the Governor to negotiate
amendments to all existing compacts pursuant to which all tribes agree that state courts will have
jurisdiction over such disputes.
(r) Indian tribes have used their gambling profits to spend well over $120 million on
campaign contributions and political activities in California. But some Indian tribes maintain
that they are sovereign nations and do not have to comply with California's laws and regulations
relating to political contributions and reporting. Because these tribal political expenditures result
substantially from, and often concern, gaming activities in California, this Act will authorize the
Governor to negotiate amendments to all existing compacts pursuant to which all tribes agree to
comply with the California Political Refom: Act.
(s) While some terms of this Act concern conditions tribal casinos must meet if
Indian tribes are to retain a monopoly over slot machines, it is the express intent of the voters to
raise revenues immediately through this initiative to help solve California's current fiscal crisis,
regardless of whether those revenues come from tribal or non-tribal gaming, regardless of court
decisions regarding Indian gaming, regardless of changes in federal law, or regardless of any
challenges or efforts by the Indian tribes or others to delay or circumvent this Act. Therefore, if
all Indian tribes with existing compacts do not agree to share with the State twenty-five pement
(25%) of their winnings from gaming devices and do not agree to the other conditions on tribal
gaming set forth in this Act within the time limits provided in this Act, it is the express intent of
the voters to immediately allow licensed gambling establishments and authorized homeracing
tracks to operate a limited number of gaming devices, provided they pay thirty-three percent
(33%) of their winnings from the operation of such gaming devices to cities, counties, and the
Gaming Revenue Trust Fund.
SECTION 3.
read:
Section 19 of Article IV of the California Constitution is amended to
SEC. 19
(a) The Legislature has no power to authorize lotteries and shall prohibit the sale of
lottery tickets in the State.
(b) The Legislature may provide for the regulation of home races and horse race
meetings and wagering on the results.
(c) Notwithstanding subdivision (a), the Legislature by statute may authorize cities
and counties to provide for bingo games, but only for charitable purposes.
(d) Notwithstanding subdivision (a), there is authorized the establishment of a
California State Lottery.
(e) The Legislature has no power to authorize, and shall prohibit casinos of the type
currently operating in Nevada and New Jersey.
(f) Notwith.~tanding subdivisions (a) and (e), and any other provision of state law, the
Governor is authorized to negotiate and conclude compacts, subject to ratification by the
Legislature, for the operation of stot--mm~ah~ gaming devices and for the conduct of lottery
games and banking and percentage card games by federally recognized Indian tribes on Indian
lands in California in accora~rice with federal law. Accordingly, shR--maohia~ gaming devices,
lottery games, and banking and percentage card games are hereby permitted to be conducted and
operated on tribal lands subject to those compacts.
(/)(g) Notwithstanding subdivision (a), the Legislature may authorize private, nonprofit,
eligible organizations, as defined by the Legislature, to conduct raffles as a funding mechanism
to provide support for their own or another private, nonprofit, eligible organization's beneficial
and charitable works, provided that (1) at least 90 percent of the gross receipts from the raffle go
directly to beneficial or charitable purposes in California, and (2) any person who receives
compensation in connection with thc operation of a raffle is an employee of the private nonprofit
organizafton that is conducting the raffle. Thc Legislature, two-thirds of thc membership of each
house concurring, may amend the percentage of gross receipts required by this subdivision to be
dedicated to beneficial or charitable purposes by means of a statute that is signed by the
Governor.
(la) Notwithstanding subdivisions (e) and (fi. and any other provision of state law, the
Governor is authorized to negotiate and conclude amendments to all existing compacts with all
Indian ~bes in accordance with the provisions of this subdivision (h). An "existing compact"
means a gaming compact entered into between the State and an Indian tribe prior to the effective
date of the Gaming Revenue Act of 2004. All compacts amended pursuant to this subdivision
(h) shall include the following terms, conditions and requirements:
(1) The Indian tribe shall agree to pay twenty-five percent (25%) of its net
win from all gaming devices operated by it or on its behalf to the Gaming
Revenue Trust Fund. Such payments shall be made monthly and shall be
due within 30 days of the end of each month. "Net win" means the
wagering revenue from all gamin.~ devices operated by the Indian tribe or
on its behalf retained after prizes or winnings have been paid to players or
to pools dedicated to the payment of such prizes and winnings, and prior
to the payment of operating or other expenses. Such payments shall
commence immediately after federal approval of the amended compact.
(2) The Indian tribe shall agree to report to the Division of Gambling Control
the net win on all gaming devices operated by or on behalf of it. Such
reports shall be submitted monthly, shall be due within 30 days of the end
of each month, and shall be available to the public upon request.
(3) The Indian tribe shall agree to pay for an annual audit performed by an
independent faro of certified public accountants approved by the
California Gambling Control Commission to ensure that the net win is
properly reported and the payment is properly paid to the Gaming
Revenue Trust Fund. The audit report shall be available to the public upon
request.
(4) The Indian tribe shall agree to comply with the California Political Reform
Act.
($) The Indian tribe shall agree that its casino facilities shall comply with the
California Environmental Quality Act.
(6) The Indian tribe shall agree to enter into good faith negotiations with any
city or county within which the Indian lands are located wh¢~ Class 1TI
(7)
(s)
Earning is conduct_ed to miti~te local Earni-~' related impacts within a
reasonable time following the State's execution of the compact. The
state courts shall have exclusive jurisdiction to resolve any dispute
regarding the failure to reach an agreement or the enforcement of the
agreea~ent.
The Indian tribe shall agree to comply with all provisions of the Gambling
Control Act, and shall agree to be subject to the jurisdiction of the
California Gambling Control Commission and Division of Gambling
Control.
The Indian tribe shall agree that state courts shall have exclusive
jurisdiction over any criminal or civil proceeding arising f~om or related to
the Gaming Revenue Act, arising from or related to the compact, or
arising fi'om or related to any act or incident occurring on the premises of
a tribal casino.
The powers of the State and the applicability of state law to Indian tribes and Indian casinos
pursuant to this subdivision (h) are to be construed consistently with the fullest extent of State's
rights and powers under federal law to reach agreements with Indian tribes with tribal consent.
No tribe with an existing compact is required by this subdivision (h) to agree to amend its
existing compact. Nothing in this Act waives or restricts the civil or criminal jurisdiction of the
State under Public Law 280 (18 U.S.C. Sec. 1162), and the State may not waive such jurisdiction
in any compacts.
(i) Notwithstanding subdivisions (a) and (e), and any other provision of state or local
law, in the event amendments to all existing compacts with all Indian tribes as provided in
subdivision {h) are not entered into and submitted to the Secretary of Interior within 90 days of
the effective date of the Gaming Revenue Act of 2004, owners of authorized gambling
establishments and owners of authorized horseracing tracks shall immediately thereafter be
authorized to operate not more than a combined total of 30,000 gaming devices. In the event
tribal monopolies are adjudicated to be illegal, in the event the amended compacts are not
approved or considered approved pursuant to the Indian Gaming Regulatory Act, or in the event
subdivision (h) is invalidated, or delayed more than 90 days after this Act would otherwise take
effect, by the State, the federal government, or any court, owners of authorized gambling
establishments and owners of authorized horseracing tracks shall immediately thereafter be
authorized to operate the gaming devices authorized by this section. For purposes of this Act,
"authorized gambling establishment" shall mean a site in the counties of Los Angeles, San
Diego, Contra Costa or San Mateo at which 14 or more gaming tables were authorized to be
operated as of September 1, 2003 purs-ant to the Gambling Control Act, except such sites that
were act~_lally taken into trust for an Indian tribe or Indians after September 1, 2003. For
purposes of this Act, "authorized horseracing track" shall mean a site in the counties of Alameda,
Los Angeles, Orange or San Mateo at which horseracing was conducted by a thoroughbred
racing association or qt~_~rter horse racing association that was licensed pursuant to the Horse
Racing Law to conduct more than 50 days or nights of racing in 2002. For purposes of this Act,
"site" shall mean the real property on which an authorized horseracing track or an authorized
gambling establishment was located as of September 1, 2003 and shall include real property
adjacent to the site.
The operation of these gaming devices shall be subiect to the following provisions:
(1) Payments.
bo
co
Owners of authorized gambling establishments and authorized
horseracing tracks shall pay thirty percent (30%) of the net win
from gaming devices operated by thera to the Gaming Revenue
Trust Fund created pursuant to this section. Such payments shall
be made monthly and shall be due wjthi~ 30 days of the end of
each month. "Net win" means the wagerin~ revenue from gaming
devices operated pursuant to this Act retained after prizes or
winnings have been paid to players or to pools dedicated to the
payment of such prizes and wipnir~gs, and prior to the payment of
operating or other expenses.
Owners of authorized gambling establishments and authorized
horseracing tracks shall report to the Division of Gambling Control
the net win on all gawing devices operated by or on behalf of
them, Such reports shall be submitted monthly, shall be due within
30 days of the end of each month, and shall be available to the
public upon request.
Owners of authorized gambling establishments and authorized
horseracing tracks shall pay for an anm~_al audit pvrformed by an
independent ~'ai of certified public accountants approved by the
California Gambling Control Commission to ensure that the net
win is properly reported and the payment is properly paid to the
Gaming Revenue Trust Fund. The audit report shall be available
to the public upon request.
Owners of authorized gambling establishments and authorized
horseracing tracks shall pay two percent (2%) of their respective
net win from gaming devices operated by them to the city in which
each authorized horseracing track and authorized gambling
establishment is located. In the event an authorized gambling
establishment or an authorized horse~acing track is not located
within the boundaries of a city, the payment imposed by this Act
shall be made to the county in which the authorized gambling
establishment or authorized horseracing track is located. Such
payments shall be made monthly and shall be due within 30 days
of the end of each month.
Owners of authorized gambling establishments and authorized
horseracing tracks shall pay one percent (1%) of their respective
6
net win bom gaming devices operated by them to the county in
which each authorized ~ambling establishment and authorized
horseracing track is located. Such payments shall be made
monthly and shall be due within 30 days of the end of each month.
Number and Location of Authorized Gaming Devices.
ao
A total of 30,000 gam'mg devices are authorized to be operated by
owners of authorized horseracing tracks and owners of authorized
gambling establishments, which are allocated as follows:
i. For authorized horseracing tracks:
Three thousand gaming devices for each authorized
horseracing track. In order to ensure the maximum
generation of revenue for the Gaming Revenue Trust Fund,
in the event that the owners of an authorized horseracing
ii.
track for any reason cease to have or lose the right to
operate any of the gaming devices authorized by this Act,
the gaming devices allocated to that authorized horseracing
track shall be reallocated equally among the remaining
authorized horseracing tracks. Notwithstanding the limit of
3,000 gamin~ devices, owners of authorized horseracing
tracks may also transfer, sell, lieeuse, or assign their fights
to own and operate one or more gaming devices to other
authorized horseracing tracks or authorized gambling
establishments, but in no event shall the total number of
gaming devices authorized to be operated at an authorized
horseraeing track exceed 3,800. The owners of gaming
devices that are realloeated, or are tran.~ferred, sold,
licensed, or assigned pursuant to this subdivision, shall
make the distributious required by California Business and
Professions Code Section 19609.
For authorized gambling establishments:
ao
Authorized gambling establishments located in Los
Angeles County authorized as of September 1, 2003
to operate 100 or more gaming tables shall be
authorized to operate 1700 gaming devices eachl
authorized gambling establishments in Los Angeles
County authorized as of September 1, 2003 to
operate between 14 and 99 gaming tables shall be
authorized to operate 1000 gaming devices eachl
and all other authorized gambling establishments
bo
shall be authorized to operate 800 gaming devices
each.
Licensed gambling establishments that are not
authorized gambling establishments under this
section shall be licensed for 4 gaming devices for
each table authorized purs-Ant to the Gambling
Control Act as of September 1, 2003 up to a
maximum of 2000 gaming devices in total, which
they cannot operate at their gambling
establishments, but may transfer, sell, or assign the
fights to own or operate such gaming devices to
authorized gambling establishments.
In order to ensure the maximum generation of
revenue for the Gaming Revenue Trust Fund, in the
event the owners of an authorized gambling
establishment described in subdivision (a) for any
reason cease to have or lose the right to operate any
of the gaming devices authorized by this Act, such
gaming devices shall be transferred or allocated to
authorized gambling establishments pro rata
according to the allocation in subdivision
(i)(2)(a)(ii)(a). Notwithstanding the limitation on
gaming devices imposed by subdivision
(i)(2)(a~(ii)fa~. authorized I~amblin~ establishments
may also transfer, sell, license, or assign their rights
to own and operate one or more gaming devices to
other authorized gambling establishments or
authorized horseracing tracks, but in no event shall
the total number of gaming devices authorized to be
operated at an authorized gambling establishment
exceed 1,900.
In the event that the allocation of gaming devices
set forth in subdivision (i)(2)(a)(ii) exceeds 15,000,
the gaming devices authorized pursuant to
subdivision (i){2){a)(ii)Co) shall be reduced ratably
to bring the total number of gaming devices
allocated to all authorized gambling establishments
to 15,000 or less.
bo
The owners of an authorized horseracing track may, in accordance
with provisions of applicable law, relocate its racing meeting to
another site whether or not it is an authorized horseracing track, or
discontinue its racing operation. In the event they do so, however,
the gaming devices authorized to be operated by them may only be
operated at an authorized horseracing track or an authorized
gambling establishment.
Co
In order to ensure the maximum geneeation of revenue for the
Gaming Revenue Trust Fund, the owner or operator of an
authorized hors¢~acing track and the owner or operator of an
authorized gambling establishment whose facilities are located in
the same city may agree upon the maximum number of gaming
devices that may be operated at each such facility subject to
approval of any such agreement by the Gambling Control
Commission, which shall make its decision of whether to approve
any such agreement based upon a det=m, ination that any such
agreement is in the interests of regulated gaming in the State of
California. Any such agre~,,ent approved by the Gambling
Control Commission shall not exceed three years in duration.
(3) Suspension of Authorization.
The authorization to operate gaming devices and to transfer, sell, or assign
rights to gaming devices purs-ant to this subdivision may be suspended by
the Gambling Control Commission for failure to make the payments
imposed by this subdivision within 30 days of such payments becoming
due.
(4) Prohibition on Additional Fees~ Taxe~ and Levies.
The payments imposed pursuant to this Act are in lieu of any and all other
fees, taxes or levies, including but not limited to revenue, receipt or
personal property taxes, that may be charged or imposed, directly or
indirectly, against authorized horseracing tracks or authorized gambling
establishments, their patrons, gaming devices, employers or suppliers, by
the State, cities or counties, excepting fees, taxes or levies that were in
effect and imposed prior to September 1, 2003 that applied to horse~acing
and con'uolled games with cards or tiles, or that are applied generally to
conunercial activities, including sales and use, income, corporate or real
property taxes. The physical expansion of gaming facilities or the
operation of gaming devices authorized by this Act shall not be considered
an enlargement of gaming operations under any local ordinance related to
fees, taxes, or levies.
Licenses.
The owne,~ of authorized gamblin~ establishments and the owners of
authorized horseracing tracks shall be licensed by the State Gambling
Control Commission under the Gambling Control Act.
0)
(6) Other Laws.
The Act shall supercede any inconsistent provisions of state, city or county
law relating to gaming devices including~ but not limited to, laws
regarding the transportation, manufacture, operation, sale, lease, storage.
ownership, licensing, repair or use of gaming devices authorized in this
Act. In order to encourage the maximum generation of revenue for the
Gaming Revenue Trust Fund, the operation of gaming devices authorized
pursuant to this Act is not subject to any pwhibition in state or local law
now existing or hereafter enacted.
Gamine Revenue Trust Fund.
(1)
(2)
There is hereby established the Gaming Revenue Trust Fgnd in the State
Treasury that shall receive all payments pursuant to the requirements of
subdivisions (h) and (i).
There is hereby established the Board of Trust.s to administer the
Gaming Revenue Trust Fund. The Board of Trustees shall be comprised
of 5 m~mbers appointed by the Gowmor. Of the 5 members, 2 shall be
engaged in public school education, 1 shall be engaged in law
enforcement, 1 shall be engaged in fire protection and 1 shall be a certified
public accountant. Each m~rnber shall be a citizen of the United States
and a resident of this state. No more than 3 of the 5 members shall be
(3)
members of the same political party. Of the members initially avvointed.
2 shall be appointed for a t=~m of two years, 2 shall be appointed for a
term of three years, and 1 shall be appointed for a t~,u of four years.
After the initial te~ttts, the term of office of each member shall be four
years. The Governor shall appoint the members and shall designate one
member to serve as the initial chairperson. The initial chairperson shall
serve as chairperson for the length of his or her term. Thereafter, the
ctmirperson shall be selected by the Board of Trustees. The initial
appointments shall be made within three months of the operative date of
this Act. The Board of Trustees shall approve all transfers ofmouies from
the Gaming Revenue Trust Fund. The Board of Trustees shall engage an
independent firm of certified public accountants to conduct an annual
audit of all accounts and transactions of the Gaming Revenue Trust Fund.
The monies in the Gaming Revenue Trust Fund shall be distributed as
follows:
(a) Not more than one percent of the monies annu_ally to the Division
of Gambling Control and the California Gambling Control
Commission for the cost of carrying out its administrative duties
pursuant to this Act, and for reimbursement of any State
depa~huent or agency that provides any service pursuant to the
provisions of this Act.
(b) Monies sufficient to R~mrantee that each non-gamin~ tribe shall
receive $1.2 million annually from the Indian Gaming Revenue
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Sharing Trust Fund as codified in the California Government
(c)
(d)
Code. "Non-gaming tribe" shall mean a federally reco..~nized
Indian tribe which operates fewer than 350 gaming devices.
$3 million to be awarded almually by the Board of Trustees to
responsible gambling programs.
After the distributions required pursuant to subdivisions (3)(a).(b).
and (e), the t~,,~aining monies shall be distributed as follows:
1. Fifty percent (50%) to county offices of education to
provide services for abused and neglected children and
children in foster care. These monies shall be allocated to
each county office of education according to each county's
proportionate share of the annual statewide total of child
abuse referral reports for the prior calendar year and shall
be used to improve educational outcomes of abused and
neglected children and children in foster care. Each county
office of education shall allocate these funds to county
(e)
(0
child protective services agencies to provide these services.
Funds received by each county child protective service
agency shall be used for the following purposes:
i. Out-stationing county child protective services
social workers in schools;
ii. Providing appropriate caseloads to ensure that
professional staff will have sufficient time to
provide services necessary to improve the
educational outcomes of abused and neglected
children and children in foster care;
iii. Providing services to children in foster care to
minimize mid-year transfers from school to school;
iv. Hiring juvenile court workers whose responsibility
it is to ensure the implementation of court orders
issued by juvenile court judges affecting a foster
child's educational performance.
Each county child protective service agency shall be
subject to all accountability standards including student
performance, enrollment, school stability and peffoz'atance
measured by the percentage of children at grade level on
standardized tests as provided by state and federal law.
Each county child protective agency shall use funds
received pursuant to this section in a manner that
maximizes the counties' ability to obtain federal matchin~
dollars for services to children in the child protective
services system.
Thirty-five percent (35%) to local governments on a per capita
basis for additional neighborhood sheriffs and police officers.
Fifteen percent (15%) to local governments on a per capita basis
for additional firefighters
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(k) The Governor shall not consent, concur or agree to the location of any tribal
casinos on newly acquired [and pursuant to 25 U.S.C. §2719(b~(l)(a). Further, any compact
entered into by the State pursuant to 25 U.S.C. §2710(d) shall only be for class III ~amin~ on
indian lands actually taken into trust by the United States for the benefit of an Indian tribe prior
to September 1, 2003, except for land contiguous to reservations existing as of that date.
SECTION 4.
as follows:
Section 19609 is added to the Business and Professions Code to read
19609.
(a) Unless othenvise defined in this chapter, the terms used in this section shall have the
meaning ascribed to th~m in the Gaming Revenue Act of 2004 ("the Act").
Co) Three quarters of one percent (.75%) of the net win from all gaming devices operated by,
or on behalf of, owners of authorized homeracing tracks upon which a thoroughbred racin~
meeting was conducted in 2002 shall be distributed for thoroughbred incentive awards and shall
be payable to the applicable official registering agency and thereafter distributed as provided in
the California Horse Racing Law.
(c) One and one-half percent (1 ~%) of the net win from all gaming devices operated by, or
on behalf of, owners of authorized homeracing tracks upon which a thoroughbred racin~ meetin~
was conducted in 2002 shall be distributed to each of those thoroughbred racing associations and
racing fairs that are not authorized horseracing tracks in the same relative proportions that such
thoroughbred racing associations or racing fairs generated commissions during the preceding
calendar year. A lessee of an authorized homeracing track as of the effective date of the Act
shall not be deemed to be an authorized horseracing track for the purposes of this Section.
(d) Seventeen and three quarters percent (17.75%) of the net win from all gaming devices
operated by, or on behalf of, owners of authorized horseracing tracks upon which a thoroughbred
racing meeting was conducted in 2002 shall be pooled ("the pooled net win") and shall be
disltibuted in the form of purses for thoroughbred homes in accordance with the provisions of
this subdivision (d).
(i)
The pooled net win shall be allocated to thoroughbred racing associations and
racing fairs throughout the State of California and shall be distributed among each
of them in such manner as to equalize on an average daily basis purses for
thoroughbred races other than stakes and special events. Notwithstanding the
fore~oin~, pooled net win may be allocated to supplement purses for
thowughbred races so the thoroughbred racing associations and racing fairs may
maintain up to their historic relative proportions between overnight races, and
stakes races and special events. Increases in the aggregate amount of purses for
stakes races of thoroughbred racing associations and racing fairs resulting from
pooled net win contributions shall be determined in accordance with an agreement
signed by all the thoroughbred racing associations and the organization
responsible for negotiating thoroughbred purse agreements on behalf of
thoroughbred horsemen.
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(ii)
Notwithstanding the provisions of subdivision (d) (i) of this Section~ the funds
distributable to thoroughbred racing associations and racing fairs fi'om the pooled
net win shall be allocated in such a manner as to cause average daily purses for
thoroughbred races, other than stakes races and special events, to be the
percentages of the average daily purses for such races conducted by thoroughbred
racing associations in the Central and Southern zone as set forth below:
(a) 90% for thoroughbred racing associations in the Northern zone;
Co) 65% for a racing fair in the Central zone~
(c) 50% for racing fairs in the Northern zone other than the Hnmboldt
County Fair;
7½% for the Humboldt County Fair.
(iii) Notwithstanding the provisions of this subdivision (d) to the contrary, the
allocation of purses among the thoroughbred racing associations and the racing
fairs may be altered upon approval of the California Horse Racing Board, in
accordance with an agreement signed by all of the thoroughbred racing
associations and the organization responsible for negotiating thoroughbred purse
agreements on behalf of horsemen.
(iv) The California Horse Racing Board shall be responsible for the ows4ght of the
distribution of the pooled net win in accordance with the provisions of this
subdivision (d).
(e) Eighteen and one-half percent (18.5%) of the net win from all ;zamin~ devices operated
by owners of an authorized horseracing track upon which a quarter horse racing meeting was
conducted in 2002 shall be paid to supplement purses of races conducted by a qnarter horse
racing association.
(0 One and four tenths percent (1.4%) of the net win from gaming devices operated by
owners of an authorized horse racing track described in subdivision (e) above shall be paid to
supplement the purses of harness races conducted by a hame.ss racing association that conducts
at least 150 days or nights of harness racing annually at the California Exposition and State Fair,
and on-tenth of one percent (. 1%) of such net win shall be paid to the harness racing association
described in this subdivision (0-
SECTION 5.
as follows:
Section 19805.5 is added to the Business and Professions Code to read
Sec. 19805.5.
As used in this chapter, and in the Gaming Revenue Act of 2004, "gaming device" shall
mean and include a slot machine under state law or any Class 1TI device under the Indian Gamin~
Regulatory Act. The operation of a gaming device by a tribe, entity or person authorized to
operate gaming devices under the Gaming Revenue Act shall constitute controlled gamin~ under
State law.
13
SECTION 6. Section 19863 of the Business and Professions Code is amended to
read as follows:
See. 19863.
A publicly traded racing association or a q, alified racing association, or their successors
in interest, shall be allowed to operate only one g~m.k':g gambling establishment, and the g=mk:~
gambling establishment shall be located on the same prr.:---:::: site as the entity's racetrack was
located in 2002.
SECTION 7.
as follows:
Section 19985 is added to the Business and Professions Code to read
Sec. 19985.
(a) Except as provided in this section, the GambYmg Control Act, including, but not limited
to, the jurisdiction and powers of the Division and Commission to enact regulations, to enforce
applicable law, to conduct background investigations and to issue licenses and work permits,
shall apply to authorized horseracing tracks as defined in the Gaming Revenue Act, and to the
operators of gaming devices thereon, including their successors in interest, in and to the same
extent the Gambling Contxol Act aoplies to gambling establishments.
Co) Employees of authorized horseracing tracks who are not owners, shareholders, nartners
or key employees, and whose iob responsibilities do not involve controlled games, shall not be
required to obtain work permits pursuant to this Chapter.
SECTION 8.
read as follows:
Section 19962 of the Business and Professions Code is amended to
19962.
(a) On and after the effeetive date of this chapter, neither the governing body nor the
eleetors of a county, city, or city and county that has not authorized legal gaming within its
boundaries prior to January 1, 1996, shall authorize legal gaming.
(b) No ordinance in effect on January 1, 1996, that authorizes legal gaming within a city,
county, or city and county may be amended to expand gaming in that jurisdiction beyond that
permitted on January 1, 1996.
(c) This seetion is not intended to prohibit gaming authorized by the Gaming Revenue Act
of 2004.
14
SECTION 9. Section 19963 of the Business and Professions Code is amended to
read as follows:
19963.
(a) In addition to any other limitations on the expansion of gambling imposed by Section
19962 or any provision of this chapter, and except as provided in the Gaming Revenue Act of
2004, the commission shall not issue a gambling license for a gambling establishment that was
not licensed to operate on December 31, 1999, unless an application to operate that establishment
was on file with the division prior to September 1, 2000.
SECTION 10. Section 19817 of the Business and Professions Code is amended to read as
follows:
The commission shall establish and appoint a Gaming Policy Advisory Committee of
10 members. The committee shall be composed of representatives of controlled gambling
licensees, authorized horse racing tracks under the Gaming Revenue Act, representatives of
~amin~ tribes, and members of the general public. The executive director shall, fi~om time to
time, convene the committee for the purpose of discussing matters of controlled gambling
regulatory policy and any other relevant gambling-related issue. The recommendations
concerning gambling policy made by the committee shall be presented to the commission, but
shall be deemed advisory and not binding on the commission in the performance of its duties or
functions. '~' ..... :~' ........ , ..4..1.. ,!. ..... 1.~1 .... T--,.I; ..... -'-.
SECTION 11. Section 12012.6 is added to the Government Code to read as follows:
(a) Notwithstanding Gow. anent Code sections 12012.25 and 12012.5, and any other
provision of law, the Governor is the designated state officer responsible for negotiating and
executing, on behalf of the state, tribal-state gaming compacts with federally recognized Indian
tribes located within the State of California pursuant to the federal Indian Gaming Regulatory
Act of 1988 (18 U.S.C. Sec. 1166 to 1168, incl., and 25 U.S.C. Sec. 2701 et seq.) for the purpose
of authorizing class m gaming, as defined in that act, on Indian lands within this state. Nothing
in this section shall be construed to deny the existence of the Governor's authority to have
negotiated and executed tribal-state gaming compacts prior to the effective date of this section.
Co) The Governor shall submit a copy of any executed tribal-state compact to the
Secretary of State who shall forward a copy of the executed compact to the Secretary of the
Interior for his or her review and approval, in accordance with paragralmh (8) of subsection (d) of
Section 2710 of Title 25 of the United States Code.
15
SECTION 12. Section 12012.75 of the Government Code is amended to rend as
follows:
There is hereby created in the State Treasury a special fund called the "Indian Gaming
Revenue Sharing Trust Fund" for the receipt and deposit of moneys derived from gaming device
license fees that are paid into the fund pursuant to the terms of tribal-state gaming compacts, and
monies received from the Gaming Revenue Trust Fund, for the purpose of making dislributions
to noncompact tribes. Moneys in the Indian Gaming Revenue Sharing Trust Fund shall be
available to the California Gambling Control Commission, upon appropriation by the
Legislature, for the purpose of making distributions to noncompact tribes, in accordance with the
Gaming Revenue Act and tribal-state gaming compacts.
SECTION 13.
rend ns follows:
Section 8.3 is added to Article XVI of the California Constitution to
Sec. 8.3
(a) Funds appropriated pursuant to the Gaming Revenue Act of 2004 shall not he
deemed to be part of "total allocations to school districts and community college districts from
General Fund proceeds of taxes appropriated pursuant to Article XIIIR" as that t~,m is used in
~aram-at~hs (2) and (3) of subdivision Co) of Section 8.
Co) Revenues derived from payments made pursu_n~t to the Gaming R~venue Act of
2004 shall not be deemed to be "General Fund revenues which may be appropriated pursuant to
Article XIlIR" as that twin is used in paragraph fl) of subdivision (b) of Section 8 nor shall they
be considered in the detctudnation of"per capita General Fund revenues" as that term is used in
l~ara~raoh (3) of subdivision Co) and in subdivision (e) of Section 8.
SECTION 14.
rend ns follows:
Section 14 is added to Article XIII B of the California Constitution to
Sec. 14
(a) For purposes of this article, "proceeds of taxes" shall not include the revenues
created by the Gaming Revenue Act of 2004.
(b) For purposes of this article, "appropriations subject to limitation" of each entity of
government shall not include appropriations of revenues from the Gamin~ Revenue Trust Fund
created by the Gaming Revenue Act of 2004.
SECTION 15. Amendment
The statutory provisions of this Act may be amended only by a vote of two-thirds of the
membership of both houses of the Legislature. All statutory amendments to this Act shall be to
further the Act and must be consistent with its purposes.
16
SECTION 16. Consistency With Other Ballot Measures
The provisions of this Act are not in conflict with any initiative measure that appears on
the same ballot that amends the California Constitution to authorize gaming of any kind. In the
event that this Act and another measure that amends the California Constitution to permit gaming
of any kind are adopted at the same election, the courts are hereby directed to reconcile their
respective statutory provisions to the greatest extent possible and to give effect to every
provision of both measures.
SECTION 17. Additional Funding
No monies in the Gaming Revenue Trust Fund shall be used to supplant federal, state or
local funds used for child protective and foster care services, neighborhood sheriffs and police
officers and firefighters but shall be used exclusively to supplement the total amount of federal,
state and local funds allocated for child protective services and foster care which improve the
educational outcomes of abused and neglected children and children in foster care and for
additional sheriffs, police officers and firefighters.
SECTION 18. Judicial Proceedings
In any action for declaratory or injunctive relief, or for relief by way of any extraordinary
writ, wherein the construction, application, or validity of Section 3 of this Act or any part thereof
is called into question, a court shall not grant any temporary restraining order, preliminary or
permanent injunction, or any peremptory writ of mandate, certiorari, or prohibition, or other
provisional or p~..anent order to restrain, stay, or oth~u~vise interfere with the operation of the
Act except upon a finding by the court, based on clear and convincing evidence, that the public
interest will not be prejudiced thereby, and no such order shall be effective for more than 15
calendar days. A court shall not restrain any part of this Act except the specific provisions that
are challenged.
SECTION 19. Severability
If any provision of this Act or the application thereof to any person or circumstances is
held invalid or unconstitutional, such invalidity or unconstitutionality shall not affect other
provisions or applications of this Act that can be given effect without the invalid or
unconstitutional provision or application, and to this end the provisions of this Act are severable.
17
City or Co~Bty
Appendix IV.a - Scenario I
Annual Allocation of Trust Fund Revenue to Cities and Counties
in California
Appendix IV.b - Scenario II
Annual Allocation of Trust Fund Revenue to Cities and Counties
in California
California Police Chiefs Association
Memorandum
PRESS RELEASE
Contact: Rick TerBorch, President
California Police Chiefs Association
805-473-5121
Police Chiefs Condemn Casino Gambling Initiative
Public Safety at Risk - Voters Urged Not to Sign Ballot-Qualifying Petitions
January 26, 2004-- The California Police Chiefs Association has taken the following
position on the casino gambling initiative whose proponents are expected to begin the signature-
gathering process today to place the measure on the November ballot:
The California Police Chiefs Association strongly opposes the casino gambling initiative
proposed for the November 2004 ballot. The association's Board of Directors recently voted
unanimously to oppose the initiative because of the serious and well-documented threats to public
safety associated with casino gambling.
Passage of this initiative will dramatically expand casino gambling in California. Thirty
thousand slot machines will be placed in 16 different locations in six California counties. These
casinos will all be in urban areas, and they will all be large, with even the smallest casinos having
several hundred slot machines.
In fact, there is a special section in the initiative that will turn one location, Hollywood Park
in Inglewood, into the one of the largest casinos in the world!
Make no mistake; there is a serious link between large scale casino gambling and crime.
That is why we opposed the Indian gaming initiatives and why we oppose this casino initiative. The
experience of Atlantic City provides a sobering preview of the crime problems that await California
if the casino initiative is adopted. According to 2002 Federal Bureau of Investigation crime reports,
Atlantic City, none of whose casinos are as big as the proposed Hollywood Park location, has an
16
overall crime index of 12,924 crimes per 100,000 people. The Atlantic City crime rate is over three
times the national average.
The California Police Chiefs Association's 336 members are responsible for providing direct
public safety services for over 70% of California. We take our responsibility of protecting the
public very, very seriously. It is for this reason that we are alarmed by the public safety threats
created by the proposed casino initiative.
Proponents of the casino gambling initiative want to buy your vote by promising much-
needed tax revenue to California. But the threat to public safety is too high a price to pay in return.
On behalf of our members, we call on California voters not to be fooled by the paid petition pushers
hired by the gambling industry to qualify this measure for the ballot. Californians can protect public
safety by refusing to sign the casino petitions.
In the event the measure does qualify for the ballot, the California Police Chiefs
Association will make its defeat a top priority, and we intend to take the lead in urging all
Californians to soundly reject this threat to public safety.
For further information about the California Police Chiefs Association position on the
casino initiative and the related crime problems, please call Rick TerBorch, President of the
California Police Chiefs Association, at 805-473-5121.
# # #
17