The bathhouse was rebuilt again in the 1930s with funds obtained from a recent airport lease on Section 14. In its updated form, the bathhouse began drawing such Hollywood notables as Dolores Del Rio, Robert Taylor, Bruce Cabot, Ralph Belamy, and Charles Farrell; the stars in turn attracted the attention of the editor of the March of Time news movies, who sent a photographer to film the bathhouse. The Agua Caliente Hot Spring, and the city which grew up around it, had become famous.
Despite (or possibly due to) the financial success of the bathhouse, the 1930s marked an all-time low for tribal sovereignty. Having managed the bathhouse enterprise for more than thirty years, tribal leaders began making business decisions that were at odds with the non-Indian community, such as the raising of Indian Canyon and bathhouse entrance fees. Such decisions incensed non-Indian business owners who felt that increased fees negatively impacted their own businesses; they demanded that federal authorities intervene to solve what they called “the Indian problem.”
The federal government responded by taking control of the Agua Caliente Indian Reservation and its business enterprises and later arrested tribal leaders on November 20, 1937. Fees were forcibly reduced to their pre-1937 levels – temporarily.
Tribal member Clemente Segundo traveled to Washington D.C. to expose these actions, which were later criticized as an over-stepping of federal authority. Addressing the House of Representative’s Committee on Indian Affairs, Clemente described a collusion of interests between federal officials and the Palm Springs Chamber of Commerce that had given rise to these events. Control of the reservation was returned to tribe some time later.
The third and final bathhouse was destroyed in 1957 to make way for the next incarnation of the tribal bathhouse.
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