05/14/2004 11:00PM

Slots bill withstands challenges


INGLEWOOD, Calif. - Two lawsuits that challenged a November ballot initiative that could lead to the introduction of slot machines at five California racetracks were dismissed Tuesday in the 2nd District Court of Appeals in Los Angeles.

The lawsuits were filed separately by the Agua Caliente Band of Native Americans and another group of tribes that owns casinos in the state.

The court declined to hear the challenges, which may be appealed to the state Supreme Court or filed in Superior Court.

The lawsuits argued that the language of the initiative violated the state constitution by addressing more than one subject and allowing a specific business to directly benefit from an initiative it sponsors. Five racetracks - Bay Meadows, Golden Gate Fields, Hollywood Park, Los Alamitos, and Santa Anita - and 11 card clubs are sponsoring the initiative.

The lawsuits were not a surprise to the backers of the initiative, according to Hollywood Park president Rick Baedeker.

"Our legal team was ready for the challenge," Baedeker said. "I will say it's very rare that a court will interfere with the referendum process."

The initiative, called the Gaming Revenue Act of 2004, would require Native American tribes that operate slot machines to increase their payments to the state from slot winnings from the current nominal levels to 25 percent. The tribes would have to agree to several other conditions, including increased oversight from a gaming control board, compliance with environmental laws, and an annual audit.

If the initiative is approved, the tribes would have 90 days to agree to the terms. Failure to comply would allow the five racetracks and the card clubs to install up to 30,000 slot machines.

Backers of the initiative have filed more than 1.1 million signatures with California's secretary of state, Baedeker said. The certification process for those signatures is under way and is expected to be completed by mid-June. Baedeker said the initiative needs about 587,000 signatures to qualify for the ballot.

"It is virtually certain that it will be certified for the ballot," he said.

The introduction of slot machines could lead to an annual increase of $310 million in Thoroughbred purses, according to a report presented in March by the backers of the initiative.