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Schwarzenegger, Palm Springs Tribe Reach Casino Deal

Sacramento Gov. Arnold Schwarzenegger and the Agua Caliente Band of Cahuilla Indians have agreed on a deal that would send almost $2 billion in casino earnings over the next twenty years to the state's general fund.

Agua Caliente Band of Cahuilla, one of the state's richest Indian tribes, would also be allowed to increase from 2,000 to 5,000 the number of slot machines it has been licensed to operate. Further, the tribe has also been granted, as part of the new deal, the go signal to open a third Palm Springs-area casino.

In return, said Agua Caliente's press secretary, Nancy Conrad, the tribe would pay the state 15 percent of its net earnings from the latest edition of machines apart from an increased share of earnings from its existing slots.

"This is a deal that the tribe is very happy with, that all sides will be very happy with," Conrad said. "Look at how much is paid out in business tax by others -- it's about 8.3 percent. This is well above that. The tribe is paying more than its fair share."

"Schwarzenegger probably got the best deal he could unless he was going to stand tough and tell them they weren't going to get anything," she added.