Cabazon Band of Mission Indians, a Federally Recognized Indian Tribe Sycuan Band of Mission Indians v. Pete Wilson, Governor

Opinion by Judge O’SCANNLAIN.

We consider the power of the State of California to tax offtrack betting activities on Indian reservations.

I

Plaintiffs Cabazon Band of Mission Indians and Sycuan Band of Mission Indians (“the Bands”) conduct simulcast wagering (offtrack betting) on their reservations to raise tribal revenue. Such activities are regulated by the federal Indian Gaming Regulatory Act (“IGRA”), 25 U.S.C. §§ 2701-2721 , which categorizes Indian gaming into three classes; simulcast wagering is Class III gaming. Under the IGRA, states and Indian tribes must negotiate compacts to regulate the terms under which Class III gaming may be conducted. Here, California and the Bands entered into compacts for the Bands to operate their simulcast wagering facilities.

Southern California Off Track Wagering, Inc. (“SCOTWINC”) is a quasi-governmental organization of racing associations formed under California law. Cal.Bus. & Prof.Code § 19608.2. Both Bands entered written agreements with SCOTWINC and the racing associations which conduct the live horse races. SCOTWINC arranges for the racing associations’ broadcast signals to be transmitted to the Bands’ on-reservation simulcast…