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Indian Tribes Use Casino Profits To Buy Real Estate

Newly wealthy tribes are buying private land and asking the federal government to add it to their reservations, making it sovereign Indian territory. The consequence: local governments stand to lose vital tax revenue.

— For decades, the Sycuan Indian reservation in eastern San Diego County was just a rugged little patch of a place. At less than 700 acres in the rural Dehesa Valley, it was one of San Diego’s smallest reservations.

But in the last decade, the Sycuan Band of Kumeyaay Indians has used profits from its successful casino to buy about 2,000 acres of land surrounding the reservation.

Now it’s asking the Federal Bureau of Indian Affairs to designate roughly 1,300 of those acres as reservation land - nearly tripling the reservation’s size and making that land sovereign Indian territory.

The effort has stirred some opposition in the surrounding community, because once that land becomes part of the reservation, it’s no longer subject to local taxes, laws or building restrictions.

The planning group has opposed it, as has San Diego County Supervisor Dianne Jacob, who represents a vast swath of East County that includes most of San Diego County's 18 reservations.

For the tribe, the move is steeped in symbolism.

“Historically and aboriginally, this was all their land. Then they were isolated on this one small reservation,” said Adam Day, who manages the tribe’s operations and is a spokesman, but not a tribal member himself. He said the tribe’s new wealth has allowed it to reassert control over land it has long had only historic – but not legal - claims to.

The tribe’s tool is a 1934 federal law establishing land transfers called fee-to-trust. It granted the U.S. Department of Interior authority to accept private land from tribes and make it part of the tribes’ reservations, affording it sovereign status.

For much of the 20th century, it rarely happened. Many tribes were too poor to purchase land.

But now, flush with casino profits, many tribes can and have used the law. And the number of fee to trust applications that tribes have submitted to the federal government has ballooned.

The Sycuan tribe’s application is remarkable for its size. But it’s not alone. According to the Bureau of Indian Affairs, there are currently about 100 pending land transfer applications in California, with more across the southwest and the nation.

In San Diego County, tribes have submitted about 60 applications – totaling 13,000 acres - since 2000, when California voters approved a new Indian gaming initiative.

The county estimates it will lose $1.3 million in property taxes annually if they are all approved.

There have been so many applications in California that in the last decade, several dozen tribes formed a coalition to work with the Bureau of Indian Affairs to streamline the approval process.

Supervisor Jacob said she was concerned by the number of fee-to-trust applications, and at the limited role the county has in the process.

“Unfortunately, we’ve not had a seat at the table, and the impacts are very serious on individual communities,” she said.

Jacob cited the lost tax revenue and the loss of control the county would otherwise have to approve development plans and mitigate impacts on communities surrounding the reservations.

The county can submit comments on a proposed land transfer, but it has little actual leverage to influence the Bureau of Indian Affair’s decision.

At Sycuan, the tribe has said it will build 50 homes for tribal members, an equestrian center and an RV park. It has agreed to make payments to the county for the next seven years to make up for the lost property taxes, as well as to fund construction of a nearby road. It’s negotiating similar agreements with the local school and fire districts, and has agreed to turn several hundred acres over to a conservation group.

“It’s by the tribe’s good grace,” Jacob said, because the tribe had no legal obligation to make those concessions.

But they have left nearby residents less than satisfied. Rae Ann Fields lives in a tidy home just outside the Sycuan reservation. She and others in the community have spoken out against the tribe’s expansion plan.

Sycuan Casino

The casino of the Sycuan Band of Kumeyaay Indians on its reservation in east San Diego County.

“In no way does our community object to Sycuan purchasing additional lands," Fields said. "Good for them. They’re successful; they are able to do that.”

But she’s concerned about how the lost property taxes might affect the local school and that the tribe might later revise its development plans.

“Our concern is that we not have any say into how that land is developed,” Fields said.

Day, the assistant tribal manager, says the tribe doesn’t plan to keep expanding or to build another casino.

“They’re not looking to make all the county back to a reservation,” he said. “But they’re trying to accommodate their tribal members and their other governmental services, and you need a land base to do that, just like a county or city has to have property available to construct facilities and provide services.”

Day said the tribe expects the land transfer to be approved by this summer.

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