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                                                       Calendar No. 204
109th Congress                                                   Report
                                 SENATE
 1st Session                                                    109-136

======================================================================
 
   MODIFYING THE DATE AS OF WHICH CERTAIN TRIBAL LAND OF THE LYTTON 
         PANCHERIA OF CALIFORNIA IS DEEMED TO BE HELD IN TRUST

                                _______
                                

               September 12, 2005.--Ordered to be printed

                                _______
                                

    Mr. McCain, from the Committee on Indian Affairs, submitted the 
                               following

                              R E P O R T

                         [To accompany S. 113]

    The Committee on Indian Affairs, to which was referred the 
bill (S. 113) modifying the date as of which certain tribal 
land of the Lytton Rancheria of California is deemed to be held 
in trust having considered the same, reports favorably thereon 
without amendment and recommends that the bill do pass.

                                Purpose

    The purpose of S. 113 is to require the Lytton Band of Pomo 
Indians (the ``Band'') to go through the administrative process 
set forth in the Indian Gaming Regulatory Act, 25 D.S.C. 2701 
et. seq. (``IGRAI''), before engaging in Class II or Class III 
gaming on land recently acquired in trust for the Band in the 
City of San Pablo, California.

                               Background


                        A. THE LYTTON RANCHERIA

    The Lyttons are a federally recognized tribe of 
approximately 280 members. From the late 1930s to the late 
1950s, the Lyttons, composed of the descendants of two 
families, lived on the 50-acre Lytton Rancheria in Sonoma 
County's Alexander Valley, about 80 miles from the City of San 
Pablo in the San Francisco Bay Area. During the termination 
policy era of the 1950s, Congress attempted to terminate the 
federal trust in the rancheria and transferred title to the 
land to individual members, who subsequently sold it to non-
Indians. In the 1980s, the Lyttons joined a lawsuit against the 
Bureau of Indian Affairs challenging the termination. Finding 
that the government had not met the conditions called for in 
the termination statute to make the termination effective, a 
federal court approved a settlement of the case in 1991. The 
settlement restored the Lyttons to their pre-termination 
status, but did not return the rancheria to them or give them 
any other land. It also required that any gaming they conducted 
in the area around their original rancheria be in conformance 
with the Sonoma County general plan for land use. The Sonoma 
County general plan does not permit gaming.

                   B. PUBLIC LAW 106-568, SECTION 819

    Prohibited from conducting gaming in the area around their 
original rancheria, the Lyttons, with the help of outside 
investors, sought land elsewhere for a casino. They identified 
a nine and one-half acre property off a major freeway in the 
City of San Pablo, twenty miles from San Francisco, that 
already had a card room operating on it. Elected officials in 
the City of San Pablo, which has a population of about 30,000 
and an unemployment rate almost twice that of the San Francisco 
Bay Area, supported, and continue to support, the proposed 
Lytton casino. In 2000, a provision sought by Congressman 
George Miller, whose district includes San Pablo, was included 
in the Omnibus Indian Advancement Act of 2000 (P.L. 106-568). 
The provision directed the Secretary to take the San Pablo 
property into trust, and deemed the land to have been held in 
trust prior to October 17, 1988 (the date IGRA was enacted). 
This ``deeming'' provision had the effect of obviating IGRA's 
restrictions on Indian gaming on lands acquired after that 
date. Section 819 of P.L. 106-568 reads as follows:

          Notwithstanding any other provision of law, the 
        Secretary of the Interior shall accept for the benefit 
        of the Lytton Rancheria of California the land 
        described in that certain grant deed dated and recorded 
        on October 16, 2000, in the official records of the 
        County of Contra Costa, California, Deed Instrument 
        Number 2000-229754. The Secretary shall declare that 
        such land is held in trust by the United States for the 
        benefit of the Rancheria and that such land is part of 
        the reservation of such Rancheria under sections 5 and 
        7 of the Act of June 18, 1934 (48 Stat. 985; 25 U.S.C. 
        467). Such land shall be deemed to have been held in 
        trust and part of the reservation of the Rancheria 
        prior to October 17, 1988.

    There have been efforts to modify the Lytton provision in 
Section 819 of P.L. 106-568 since shortly after its enactment. 
A provision in the FY2002 Interior Appropriations bill (P.L. 
107-63), of indeterminate effect, provided:

          Sec. 128. The Lytton Rancheria of California shall 
        not conduct Class III gaming as defined in Public Law 
        100-497 on land taken into trust for the tribe pursuant 
        to Public Law 106-568 except in compliance with all 
        required compact provisions of section 2710(d) of 
        Public Law 100-497 or any relevant Class III gaming 
        procedures.

                     C. THE APRIL 5, 2005, HEARING

    On April 5, 2005, the Committee held a legislative hearing 
on S. 113, at which Senator Feinstein and Congressman George 
Miller testified. The Department of Interior also testified on 
behalf of the Administration. The Department stated that it did 
not object to S. 113 because it believed waiving the 
requirements of IGRA Sec. 20 for any particular tribe was 
inappropriate. In response to questioning from Committee 
Members, the Department also stated that it was of the opinion 
that S. 113 did not constitute a ``taking'' of private property 
rights of the Band pursuant to the Fifth Amendment of the 
United States Constitution.
    Also testifying were the Band, the City of San Pablo, the 
California State Assemblywoman in whose district the subject 
land is located, and the Pechanga Band of Luiseno Indians. The 
City testified regarding its desire to have the Band operate a 
casino in San Pablo, however, the Assemblywoman testified that 
other surrounding communities were strongly opposed to the 
casino. The Pechanga Band testified that it supported S. 113 
because it believed all tribes should follow the dictates of 
IGRA Sec. 20, and that S. 819 violated a ``promise'' made by 
California tribes to the California electorate, that tribes 
would not seek ``urban'' casinos.
    Subsequent to the hearing, the Committee requested the 
views of the Department of Justice regarding whether S. 113 
might constitute a ``taking'' of private property pursuant to 
the Fifth Amendment of the United States Constitution. The 
Department of Justice responded by letter on September 9, 2005, 
stating that it was of the view that S. 113 would not 
constitute a ``taking.'' (A copy of the letter is included with 
this report.)

                      Summary of Major Provisions

    S. 113 amends Section 819 of Public Law 106-568 by simply 
striking the last sentence of the provision in the Omnibus 
Indian Advancement Act of 2000 that ``deems'' the Band's San 
Pablo property to have been taken into trust prior to 1988. The 
intent of this is to require the Band to comply with IGRA's 
restrictions on Class II and Class III gaming that apply to 
land acquired after 1988.

                          Legislative History

    S. 113 was introduced on January 24, 2005, by Senator 
Feinstein and was referred to the Committee on Indian Affairs. 
Senators Coburn and Ensign were added as cosponsors on July 18, 
2005.
    On April 5, 2005, a legislative hearing on S. 113 was 
conducted by the Committee. Senator Feinstein and Congressman 
George Miller appeared to provide testimony at the hearing. 
Also appearing to provide testimony was the Department of 
Interior, the Band, the City of San Pablo, the California State 
Assemblywoman in whose district the subject land is located, 
and the Pechanga Band of Luiseno Indians.
    On June 29, 2005, the Committee held an open business 
meeting during which S. 113 was considered. During the business 
meeting, the Committee voted to favorably report S. 113 to the 
full Senate with a recommendation that the bill do pass.

            Committee Recommendation and Tabulation of Vote

    On June 29, 2005, the Committee, in an open business 
session, considered S. 113. Upon a motion by the Chairman for 
approval of S. 113, and a request for a roll call vote by Sen. 
Inouye, the Committee held a roll call vote on the motion, with 
10 Members voting aye and 3 Members voting nay. With a majority 
of Members having voted in the affirmative, the Committee 
ordered S. 113 favorably reported to the full Senate with a 
recommendation that the bill do pass.

                   Cost and Budgetary Considerations

    The cost estimate for S. 113 as calculated by the 
Congressional Budget Office, is set forth below:

               Congressional Budget Office Cost Estimate


S. 113--A bill to modify the date as of which certain tribal land of 
        the Lytton Rancheria of California is deemed to be held in 
        trust

    Summary: S. 113 would eliminate a provision of the Omnibus 
Indian Advancement Act that effectively made certain land held 
in trust for the Lytton Rancheria tribe eligible for use as a 
gaming site without meeting certain requirements of the Indian 
Gaming Regulatory Act (IGRA). CBO estimates that implementing 
S. 113 would have no significant impact on the federal budget.
    Making the Lytton Band of Indians subject to the 
requirements of IGRA would be considered an intergovernmental 
mandate as defined in the Unfunded Mandates Reform Act (UMRA). 
While the total cost of this mandate is very uncertain, CBO 
expects that it would likely exceed the threshold established 
in UMRA ($62 million in 2005, adjusted annually for inflation) 
in at least one of the next five years. S. 113 contains no 
private-sector mandates as defined in UMRA.
    The bill would amend legislation enacted in 2000 that 
ordered the Department of the Interior (DOI) to take land in 
California into trust for the Lytton Rancheria. That 
legislation contained a provision deeming the trust status of 
that land to be retroactive, effectively permitting the tribe 
to install electronic bingo machines or slot machines without 
meeting the conditions imposed by section 20 of IGRA. Section 
20 requires additional regulatory review and approval of 
proposed Indian gaming facilities by DOI and the appropriate 
governor as well as consultation with local communities. S. 113 
would delete that provision of the 2000 act, thereby making the 
tribe's gaming operations subject to section 20 of IGRA.
    Estimated cost to the Federal Government: If S. 113 is 
enacted, DOI would probably incur additional administrative 
expenses to review a proposal by the Lytton Rancheria for 
approval of its plans to operate gaming machines on the 
affected land. CBO estimates that such costs would be less than 
$500,000.
    Based on information provided by the Department of Justice, 
CBO assumes that the United States would not be held 
responsible for economic losses incurred by the tribe if it is 
unable to obtain approvals to operate gaming machines on the 
trust land as a result of enacting this legislation. If a court 
were to determine that the government must compensate the tribe 
for such a possible loss, however, federal spending (probably 
from the Claims and Judgments Trust Fund) would be significant. 
We estimate that enacting this legislation would have no effect 
on other direct spending or revenues.
    Estimated impact on state, local, and tribal governments: 
By making the Lytton Rancheria land subject to section 20 of 
IGRA, S. 113 would significantly affect the Rancheria's gaming 
operations. The affected site is currently in use as a card 
room, but the tribe plans to install 500 electronic bingo 
machines by the fall of 2005, and possibly more in the future. 
Should S. 113 be enacted, the tribe would be prohibited from 
operating these machines until they completed the process 
required by section 20 of IGRA and received the necessary 
approvals. It is uncertain whether the tribe would receive such 
approvals or how long the process might take. In the meantime, 
the tribe would lose the earnings from those machines. These 
lost earnings would be the primary cost of the mandate.
    Based on information received from tribal representatives 
and from the National Indian Gaming Commission, CBO estimates 
that the annual cost of the mandate, in the form of lost 
earnings, could reach $50 million to $100 million within the 
next five years. The tribe also would incur administrative and 
legal costs to comply with the additional conditions. This 
estimate is subject to a great deal of uncertainty concerning 
both the level of revenue that would be generated by the 
initial 500 machines, as well as the possibility that the tribe 
would expand its operations in the absence of this legislation. 
It is also possible that the threat of this legislation would 
affect the situation even without it becoming law. CBO believes 
it is likely, however, that the cost would exceed the UMRA 
threshold at some point within the next five years. (The 
threshold is $62 million in 2005, adjusted annually for 
inflation.)
    Estimated impact on the private sector: S. 113 contains no 
private-sector mandates as defined in UMRA.
    Estimate prepared by: Federal costs: Deborah Reis; impact 
on state, local, and tribal governments: Marjorie Miller; 
impact on the private sector: Alicia Handy.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.
                                                September 12, 2005.
Hon. John McCain,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 113, a bill to 
modify the date as of which certain tribal land of the Lytton 
Rancheria of California is deemed to be held in trust.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Deborah 
Reis and Marjorie Miller.
            Sincerely,
                                       Douglas Holtz-Eakin,
                                                          Director.
    Enclosure.

               Regulatory and Paperwork Impact Statement

    Paragraph 11(b) of rule XXVI of the Standing Rules of the 
Senate requires that each report accompanying a bill to 
evaluate the regulatory and paperwork impact that would be 
incurred in carrying out the bill. The Committee has concluded 
that S. 113 will not require the promulgation of regulations so 
the regulatory and paperwork impact should be minimal.

                        Executive Communications

    The following executive communication was received on this 
legislation.
                             Department of Justice,
                             Office of Legislative Affairs,
                               Washington, D.C., September 9, 2005.
Hon. John McCain,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: In a July 18, 2005 letter, you requested 
the Department of Justice's views on S. 113, a bill to modify 
the date as of which certain tribal land of the Lytton 
Rancheria of California is deemed to be held in trust. The 
Committee recently held a hearing on S. 113, at which the 
Department of the Interior testified that S. 113, if enacted, 
would not constitute a ``taking'' pursuant to the Fifth 
Amendment of the United States Constitution. While the 
Department of Justice (the ``Department'') did not testify at 
that hearing, you have asked whether the Department believes S. 
113 would constitute a Fifth Amendment ``taking'' of a property 
right of the Lytton Rancheria of California. Thank you for the 
opportunity to present the Department's views on the bill.
    The Department understands S. 113 to clarify the effect of 
section 819 of the Omnibus Indian Advancement Act of 2000, 
which deemed the property to have been held in trust since 
before the enactment of the Indian Gaming Regulatory Act 
(``IGRA''). IGRA prohibits gaming on land ``acquired'' after 
its enactment (unless the Tribe undergoes an additional 
regulatory process). 25 U.S.C. Sec. 2719(a) & (b)(I)(A). 
Section 819 deemed the land to be held in trust prior to IGRA's 
enactment; it did not deem the acquisition date to be earlier. 
To the extent there exists any ambiguity in section 819, S. 113 
will clarify Congressional intent.
    Moreover, enactment of S. 113 should not constitute a 
taking, as it 1) simply clarifies the economic regulatory 
scheme applicable to the property and 2) if the bill were 
deemed to alter the uses of the property, it only addresses 
economic regulation and does not deprive the property of all 
economically viable uses. Congress has plenary authority to 
regulate gaming on Indian lands, and can freely alter 
applicable laws. Because gaming is a highly regulated industry, 
those who engage in gaming-related activity should anticipate 
the possibility that the law may change. S. 113 is an 
application of Congressional authority to regulate such 
economic activity.
    Thank you for your attention to this matter. If we may be 
of additional assistance, please do not hesitate to contact 
this office. The Office of Management and Budget has advised 
that there is no objection from the standpoint of the 
Administration's program to the presentation of this letter.
            Sincerely,
                                      William E. Moschella,
                                        Assistant Attorney General.

                        Changes in Existing Law

    In compliance with subsection 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill S. 113, as ordered reported, are shown as follows 
(existing law proposed to be omitted is enclosed in black 
brackets, new matter is printed in italic, existing law in 
which no change is proposed is shown in roman):

                           PUBLIC LAW 106-568

    To authorize the construction of a Wakpa Sica 
Reconciliation Place in Fort Pierre, South Dakota, and for 
other purposes.
    Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled,

           *       *       *       *       *       *       *


TITLE VIII--TECHNICAL CORRECTIONS

           *       *       *       *       *       *       *


SEC. 819. LAND TO BE TAKEN INTO TRUST.

    Notwithstanding any other provision of law, the Secretary 
of the Interior shall accept for the benefit of the Lytton 
Rancheria of California the land described in that certain 
grant deed dated and recorded on October 16, 2000, in the 
official records of the County of Contra Costa, California, 
Deed Instrument Number 2000-229754. The Secretary shall declare 
that such land is held in trust by the United States for the 
benefit of the Rancheria and that such land is part of the 
reservation of such Rancheria under sections 5 and 7 of the Act 
of June 18, 1934 (48 Stat. 985; 25 U.S.C. 467). [Such land 
shall be deemed to have been held in trust and part of the 
reservation of the Rancheria prior to October 17, 1988.]

           *       *       *       *       *       *       *