Republican leaders at the Arizona Legislature are proposing that tribes with outstanding water disputes with the state be forced to settle those claims before they can renegotiate the number of slots and games they offer at casinos.

That's the idea behind House Bill 2447, sponsored by Rep. Steve Pierce, R-Prescott, with House Speaker Rusty Bowers, R-Mesa, and Senate President Karen Fann, R-Prescott, among others, as co-sponsors.

The complex negotiations over water rights, where a court must determine which parties get certain amounts of water, can take decades to settle, and nine tribes in Arizona have unsettled water rights, including the largest, the Navajo Nation.

The bill would serve to speed up those negotiations because the gaming compacts that allow tribes to run casinos, which are vital to their economies, expire for many tribes in 2023.

"It needs to be resolved for the tribes and for the state," Pierce said of the water disputes. "What's going to push them to settle? Who is making money is the lawyers. It's not undoable. It's not a burden. It has to be done some time."

Sixteen of the state's 22 federally recognized tribes operate 24 full-scale casinos with gaming compacts and another six have rights to operate slots that they may lease to other tribes, according to the Arizona Department of Gaming.

Gov. Doug Ducey's office has been negotiating new tribal gaming compacts, potentially overhauling them, for the past few years.

Ducey said in his State of the State speech he is working on a new state compact "that is regulated, safe and limited, and that preserves the culture of our state."

The compacts with individual tribes also set out how much gaming revenue is shared with state and local governments.

Ducey thanked tribal leaders for the negotiations, and said a deal was "close."

"It’s been a give and take," he said. "We owe it to our tribes and our citizens to get it done."

Ducey and the tribes reached a deal to renegotiate the contracts in late 2016. Other proposed pieces of legislation that would disrupt those negotiations, like a bill for sports betting last year, have stalled at the Capitol.

The bill regarding water disputes reads: "This state may not enter into, negotiate, execute, extend or renew any tribal-state gaming compact with a tribe that is a party to litigation regarding water rights in which this state is an adverse party."

Pierce said he hasn't heard from the Governor's Office yet regarding the gaming-water bill.

"I’m waiting for the call from them," he said Thursday evening.

He said he expects initial opposition from tribes, too.

"You're probably right if they are upset, but it's to help them, too," Pierce said. "The sooner they get things resolved, the bills from the lawyers offices go down."

'An attack on their very existence'

Sen. Jamescita Peshlakai, D-Cameron, who is Navajo, said it's certain the tribes will oppose the measure.

"They are going to consider it an attack on their very existence. And it really is."

She said the issues were individually important.

"This bill would try to merge them together to address an Arizona state water crisis that the state itself has not prepared for. Each of those issues needs to be addressed on their own," Peshlakai said.

Bill co-sponsor Rep. Mark Finchem, R-Oro Valley, said the state doesn't get as much as it should from existing gaming compacts, and echoed that the water disputes should be resolved.

“If the tribes don’t have the impetus to adjudicate water rights, we’ll bring them to the table some other way,” Finchem said.

Sarah Porter, director of the Kyl Center for Water Policy at Arizona State University’s Morrison Institute, said it is important that the tribal water disputes are settled, but the proposed bill's methods are problematic.

"It is important to clear up," Porter said.

Through an adjudication of water rights, a court catalogs who has rights to the water, and with more people moving to Arizona, the need to settle such matters is increasing, she said.

"Without adjudication, we don't know who has a right to what water," she said. "The problem is getting worse. More and more people are coming in and trying to rely on the water that is in dispute. A lot of people are vulnerable. They may be found not to have a right to water they think they have a right to."

Others have a role, too

A problem with the bill, she said, is that tribes don't hold all the cards.

"It is not really in the tribes' power to settle," Porter said. "They could deeply desire to settle, but there are lots of other parties and entities that have to participate."

Porter said a tribe could have a gambling compact tied up as the parties in a water settlement wait for approval from the federal government, for example.

"This bill would change the balance of power ... and give the other parties to a potential water settlement also power over tribes ability to negotiate a gaming compact," Porter said.

Reach reporter Ryan Randazzo at ryan.randazzo@arizonarepublic.com or 602-444-4331. Follow him on Twitter @UtilityReporter.

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