This case involves whether the North Fork Rancheria of Mono Indians will be able to open a casino on land acquired after 1988.
In California v. Cabazon Band of Mission Indians (1987) 480 U.S. 202, 202, the United States Supreme Court held that California could not prohibit Indian tribes from operating gambling businesses if California also allowed the same games to be operated and staffed by charitable organizations.
Congress then passed the federal Indian Gaming Regulatory Act (IGRA; 25 U.S.C. § 2701 et seq.) to regulate Indian gaming. It provides some low-stakes games (Class I) on Indian lands are within the exclusive control of tribes; Class II games are allowed on Indian lands only if the State permits others to engage in that type of gaming, and the tribe approves it; and Class III games (everything else, including slot machines, etc.) are lawful on Indian lands only if: (a) authorized by a tribe; (b) located in a State where those games are not totally prohibited; and (c) under a Tribal-State compact. But States are not free to simply deny a tribe a compact. The State must negotiate in good faith and—eventually, after litigation and additional steps—the Secretary of the Interior can effectively impose a compact on the State.
So, unless completely prohibited by a State, Class III gaming is allowed on “Indian Lands.” Indian Lands include reservations and land held in trust by the federal government for the benefit of a tribe. But under section 20(b)(1)(A) of IGRA, gaming may generally not occur on land taken into trust by the federal government after 1988 unless “the Secretary [of the Interior], after consultation with the Indian tribe and appropriate State and local officials . . . determines that a gaming establishment on newly acquired lands would be in the best interest of the Indian tribe and its members, and would not be detrimental to the surrounding community, but only if the Governor of the State in which the gaming activity is to be conducted concurs in the Secretary's determination.” (25 U.S.C. § 2719(b)(1)(A).) This prevents a tribe from setting up a casino anywhere it wants.
Some tribes sought to open casinos but were prevented when a Governor did not “concur.” Unhappy with this outcome, they sued to declare the “concurrence” provision unconstitutional.
In Confederated Tribes of Siletz Indians of Oregon v. U.S. (9th Cir. 1997) 110 F.3d 688, 697, the plaintiff argued that the “concurrence” provision in the IGRA violated the US Constitution because it improperly gave federal power to governors who had not been properly appointed as Officers of the United States. The court held that the power to concur was “not significant enough to require appointment” because the Governor does not have primary responsibility for protecting a federal interest. As part of its analysis, the Ninth Circuit described the “concurrence” as being an exercise of state authority (as opposed to federal power): “If the Governor concurs, or refuses to concur, it is as a State executive, under the authority of state law. The concurrence (or lack thereof) is given effect under federal law, but the authority to act is provided by state law.” To illustrate this point, the Ninth Circuit pointed to North Dakota v. U.S. (1983) 460 U.S. 300, 317 where a legislature passed a law limiting the Governor’s ability to consent to a federal acquisition of land, suggesting that the State as a whole had power over the concurrence process. However, the United States Supreme Court did not rule on whether the State legislature could impose conditions on a consent—it avoided the question. (Id. at fn. 20.)
In Lac Courte Oreilles Band of Lake Superior Chippewa Indians of Wisconsin v. United States (7th Cir. 2004) 367 F.3d 650, the appellate court was faced with many of the same arguments as the Ninth Circuit in Confederated Tribes. With respect to the Appointment’s Clause, the plaintiffs argued the Governor of Wisconsin was not permitted by Wisconsin law to provide a concurrence and, therefore, any concurrence must be under federal law (and require appointment). The Seventh Circuit assumed that state law did not explicitly authorize a concurrence, but that did not change the result: “Notwithstanding the absence of a specific Wisconsin state law authorizing the Governor of Wisconsin to respond to the Secretary of the Interior's request for concurrence, we conclude that the Governor of Wisconsin's role . . . is not one that requires appointment . . . .”
The plaintiffs also argued that the concurrence improperly vested the Governor with authority to act outside Wisconsin’s Constitution or laws. The Seven Circuit concluded that the act of a concurrence “regarding any particular proposal is not analogous to creating Wisconsin's gaming policy wholesale — a legislative function — but rather is typical of the executive's responsibility to render decisions based on existing policy. The governor's role is not inconsistent with the Wisconsin Constitution, which vests ‘the executive power ... in a governor.’ Wisc. Const. Art 5, § 1.” The Seventh Circuit also believed that the Wisconsin Legislature could limit the Governor by passing legislature to “curtail the Governor's power to concur” or the People could prevent gubernatorial concurrence through a constitutional amendment to prohibit “all gaming.”
In United Auburn Indian Community of Auburn Rancheria v. Newsom (2020) 10 Cal.5th 538, 543, (United Auburn), the plaintiff argued California’s governor does not have authority under California law to “concur.”
The California Supreme Court expanded on the reasoning in Confederated Tribes of Siletz Indians of Oregon, holding that in order to “concur,” the California Governor must have authority under California law to “concur,” and that power to concur cannot be provided by the IGRA.
In IGRA, Congress chose to allow States a limited ability to prevent the Secretary of the Interior from allowing certain gaming. IGRA does not require express approval by a state Legislature, only its Governor. Presumably, Congress believed that consultation with a governor alone was sufficient to ensure the Secretary would not run roughshod over State interests. Since IGRA’s “concurrence” requirement is a limit on federal power as selected by Congress, it is arguably inimical to Congresses intent to allow Legislatures to create additional veto points to the process. As stated in Lac Courte Oreilles, “A governor does not enact federal policy by issuing a concurrence, but instead merely waives one legislatively enacted restriction on gaming.”
Regardless, the California Supreme Court held that the Governor did have authority because of the “Governor's historical practice of concurring under a variety of federal statutes, the legislatively enacted expectation that the Governor represent the state's interests in negotiations or proceedings involving the federal government, and the absence of any explicit constitutional or statutory limits on the Governor's power to concur in the Interior Secretary's determination under IGRA.” Like the federal circuit courts, the California Supreme Court presumed the California could pass a law that prohibited the Governor from “concurring,” but had not done so.
The dissent argued that the Governor did not have authority because the California Constitution initially flatly prohibited casinos; Proposition 1A made a limited exception for tribal gaming; and that the California voters that passed Proposition 1A probably did not anticipate that Proposition 1A would allow for placing a casino outside of the “compact” process, or understand “Indian Lands” to include newly acquired land. Because the authority to concur was not explicitly provided to the Governor through Proposition 1A, the dissent believed the otherwise general prohibition on casinos should apply, and the Governor does not have authority to concur.
Following this decision, the court of appeal in Stand Up for California! et al. v. State of California et al. (Stand Up) was again faced with deciding if the Governor had the authority to concur with the Secretary in using land to allow the Mono Indians (North Fork) to operate a casino.
The result seems dictated by United Auburn Indian Community of Auburn Rancheria v. Newsom (2020) 10 Cal.5th 538, but the court (Smith, J.) found the case distinguishable.
In Stand Up, tribes sought to develop casinos on new land. Under IRGA, the Secretary approved the tribes applications and the Governor concurred with the Secretary for the creation of a casino. The Governor also negotiated tribal-state compacts. As required under California law, the compacts were sent to the Legislature for approval; and the Legislature approved the compacts. However, the plaintiff then initiated a statewide referendum to challenge the Legislative approval of the compacts (outspending the proponents of the casinos by about 20 to 1). But Plaintiffs did not initiate a referendum to challenge the “concurrence.”
In the referendum the voters did not approve the compacts. Afterwards, California did not attempt to re-negotiate compacts. So, eventually, under the process provided by IGRA a compact was imposed by the Secretary of the Interior.
The decision in Stand Up holds that by rejecting the compacts, the voters also implicitly revoked the California Governor’s concurrence. The referendum did not actually state it was rejecting the concurrence, but the court concluded the people “may impliedly annul the Governor’s concurrence,” and upholding the concurrence would be contrary to the presumed intent of the referendum.
The decision in Stand Up does not stand up to scrutiny.
First, the opinion concludes the power to revoke the concurrence can be by referendum. “The referendum is the power of the electors to approve or reject statutes or parts of statutes. . . .” (Cal. Const., art. II, § 9(a).) “A referendum measure may be proposed by presenting to the Secretary of State, within 90 days after the enactment date of the statute.” (Id. at § 9(b).) The plain text of the constitution allows for the use of a referendum to challenge a “statute” after “enactment.” The “concurrence” is not a statute and it is generally not described as being “enacted.”
Justice Smith asserts, “We interpret the Constitution’s phrase
‘statutes or parts of statutes’ as referring to legislative actions.” Justice Smith then asserts the Governor’s concurrence
is both legislative and executive and, therefore, subject to referendum. No authority is provided for the assertion that
a concurrence is “legislative” or the assertion that a referendum can apply to
acts by the Governor that are only partly “legislative.” While the California Supreme Court described the concurrence power as "containing features that cut across both" executive and legislative powers, it later states, "That the Governor has historically been tasked with concurring — or declining to concur — under a variety of federal statutes also supports our conclusion that the concurrence power is an executive one." Thus, the
Stand Up ignores the California Supreme Court's "conclusion" in this regard and does not discuss how a referendum could apply to act of the Governor. For example, Stand Up does not discuss Lac Courte Oreilles Band of Lake Superior Chippewa Indians of Wisconsin v. United States (7th Cir. 2004) 367 F.3d 650, which described the concurrence function as executive in nature but could be limited through legislation.
More significantly, the plaintiff Stand Up did not actually use the referendum process to challenge the Governor’s concurrence.
The question of whether a referendum can overturn a concurrence is distinct from whether the referendum of the compacts did. California case law supports the proposition that “reasonably doubts should be resolved in favor of the use of the referendum power.” But that does not suggest the referendum power may be applied outside of the actual statutes being challenged. The California Constitution requires the presentation of “5 percent of the votes for all candidates for Governor at the last gubernatorial election, asking that the statute or part of it be submitted to the electors.” (Cal. Const., art. II, § 9.)
If, as Stand Up holds, a party can challenge a concurrence by referendum, then Stand Up could have done so by identifying the concurrence as the “statute or part of it” to be submitted to the electors; it did not. The referendum did not purport to revoke the Governor’s concurrence. Because Stand Up never challenged the Governor’s concurrence by referendum, it was not revoked by referendum.
Not willing to give up, Justice Smith creates an entirely new concept in California law: a referendum as to one legislative act can revoke other partly-legislative acts implicitly. This holding is not supported by legal authorities and is not well-reasoned.
Justice Smith reasons, “Where a constitutional power is implicit—that is, has been impliedly granted by the people to the Governor—an appropriate balance is struck by recognizing the people may impliedly annul an exercise of that power. In other words, by parity of reasoning, that which the people granted by implication can be annulled by implication.” The opinion does not cite any authority for this novel principle. It may sound nice as rhetoric, but there is no logical connection between the source of authority and the appropriate means to revoke it, or the standards to apply in construing the scope of a referendum.
In discussing the scope of Proposition 48, the opinion begins, “Initially, we consider who drafted Proposition 48. While not decisive, the fact by the official title and summary was prepared by the Attorney General’s Office, which is representing the state defendants, supports applying the general principle that reasonably doubts should be resolved in favor of the use of the referendum power.” The scope of the amendment has nothing to do with who drafted the proposition description. It was Plaintiff Stand Up that decided the scope of the referendum by selecting the statutes they wished to challenge.
The summary of Proposition 48 was drafted by the Attorney General as required by California law. Perhaps Justice Smith wished to invoke the principal—from contract law—that a contractual ambiguity may be resolved against the drafter of the contract. (Cal. Civ. Code, § 1654; Steller v. Sears, Roebuck & Co. (2010) 189 Cal.App.4th 175, 183–184.) But, a referendum is not a contract; the Attorney General is not a party to the referendum but performing its duty to accurately describe the referendum; and Stand Up does not point to any ambiguity in the description of the referendum created by the Attorney General. In sum, the argument in Stand Up is unclear and, from my best guess as to what Justice Smith is trying to say, misguided.
Justice Smith goes on to speculate as to the voter’s intent in not approving the compacts. He does not look to the words of the referendum or the text of the summary. Justice Smith asks would voters have rejected the compacts, but at the same time wanted the Secretary of the Interior to, essentially, impose a compact? Based upon his personal surmise, he thinks it unlikely.
Notably, the opinion in Stand Up fails to look at the Proposition 48 summary which summarizes what would happen if the proposition was rejected:
If this proposition is rejected by voters, North Fork would not be able to move forward with the construction and operation of a new casino unless a new compact was approved by the state and federal governments. Wiyot would be free to negotiate a new compact with the state for gaming activities on its tribal lands.
While not going through all of the provisions of IGRA, the voters were told, “This may not be the end of the story! The tribes will have another chance.”
Justice Smith presents a false choice: between approving the compact as negotiated, and rejecting any casino. But it is just as possible that the voters opposed the specific compacts at issue. Maybe going back to the drawing board was what the voters wanted. This is what they told they were voting on.
For example, the ballot summary highlighted that the compacts would exclude projects “from scope of the California Environmental Quality Act.” And Stand Up asserted “PROP 48 DOESN’T PROTECT THE ENVIRONMENT.” Perhaps voters were driven by environmental concerns and wanted new agreements that would address this issue.[1]
If Stand Up wanted to ask voters to reject the concurrence, prohibit
the Governor’s concurrence, or to all casinos on new Indian lands, it could
have presented those propositions. Instead,
it focused on the specific projects at issue, including the specific waiver of
CEQA. (See Hodges v. Superior Court (Ford Motor Co.) (1999) 21 Cal.4th 109 [narrowly construing ambiguous proposition based upon policy arguments presented to voters].)
The opinion in Stand Up ignores the text of the referendum, the text of the summary, the actual arguments presented in opposition to the compacts. There is no evidence for an “implicit” rejection of the Governor’s concurrence beyond the appellate justice’s gut feelings. [2]
Finally, Stand Up concludes that a Governor’s concurrence can be withdrawn as a matter of State law, but does not consider whether it can be withdrawn for purposes of the IGRA. Simply because California says it withdraws its concurrence does not mean that it will be effective under the federal IGRA.
In North Dakota v. U.S. (1983) 460 U.S. 300, 314–317, the Supreme Court held that the Governor’s concurrence provided to facilitate federal land acquisition for a federal goal could not be revoked. So, assuming California can withdraw an otherwise valid concurrence under California law, it may not be able to do so under federal law. The rest of the case is then moot—the concurrence condition had been met and the casino can go forward. From the opinion, the Justices to not explain how California courts can provide the Plaintiff Stand Up with a remedy.
[1] If a court is going to try to delve into the thought process of the voters, maybe it should consider that voters were bludgeoned by a lopsided advertising campaign against the North Fork. The supporters of the compacts spent $600,000; Stand Up and friends spent $15,700,000, the vast majority from other tribes trying to avoid competition.
[2] A better argument for Stand Up might be to cite to cases holding that if an ordinance is rejected by referendum, the government may not pass a new ordinance “in all essential features like the repealed ordinance.” (Rubalcava v. Martinez (2007) 158 Cal.App.4th 563, 569 [new ordinance enforceable because attempts to address prior objections in good faith].) Whether the “concurrence” can be considered essentially the same as “re-enacting” the rejected compacts is an issue that is not explored and may depend upon a review of “the features that gave rise to popular objection.” (Id. a p. 575.)
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