Senate Indian Affairs Committee Hearing Today - Regulation of Class III Gaming.

A major issue this year to the State Assembly concerning the ratification of the amended compacts was the oversight or regulation of Class III gaming which includes Nevada style slots. The issue was born out of a Federal Appeals court decision last fall which ruled that the National Indian Gaming Commission did not have the authority to regulate most tribal casinos.

The Senate Indian Affairs Committee is holding a hearing today on discussion draft legislation regarding the regulation of Class III gaming. The bill seeks to affirm the National Indian Gaming Commission's authority over Class III gaming.

Sen. Byron Dorgan of North Dakota is the current chairman Senate Indian Affairs Committee and is purposing two major concessions that would address the basic question of who or what should regulate Class III gaming… Tribal / State Compacts or the NIGC. The first provision requires the NIGC to defer to existing tribal-state Class III compacts as long as they meet certain "minimum standards." Those "minimum standards" are the subject of another provision in the draft. NIGC would be required to form a "Class III regulatory committee" to consult with tribes about new rules for slot machines, card games and related casino games. The committee would essentially be able to rewrite the NIGC's Minimum Internal Control Standards, or MICS.

Background:

The Indian Gaming Regulatory Act was signed into law on October 17, 1988. The Act established the National Indian Gaming Commission (NIGC). The stated purpose of the NIGC is to regulate the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments. In addition, the NIGC was to provide regulation of Indian gaming to adequately shield it from organized crime and other corrupting influences, to ensure that each Indian tribe was the primary beneficiary of its gaming operations and to assure that gaming is conducted fairly and honestly by both the casinos and players.

Tribes have all along insisted that it was not the NIGC's job to establish federal regulations that override the sovereign decisions of tribes and states made through Class III gaming compacts, and the court ruling last fall agreed.

The NIGC still has the power to review tribal gaming ordinances and tribal gaming management contracts. Under IGRA, the Bureau of Indian Affairs has the authority to approve or disapprove tribal-state gaming compacts.

Sen. John McCain (R-Arizona) has been a supporter for tribal sovereignty but has said that the recent ruling "defies logic" because it limits the NIGC's role. "I think we're going to have to try come up with some fix for this," he said. "I respect tribal sovereignty and have a clear record of support for tribal sovereignty sometimes to the dismay, perhaps, of some of my constituents," McCain said at a September 21, 2005 hearing before the Senate Indian Affairs Committee, which he chaired at the time. But in defending his record, McCain advocated a somewhat controversial view. He said that sovereignty is limited in areas like tribal gaming, an industry that employs tens of thousands of non-Indians and attracts non-Indians to casinos across the country.

"To assert tribal sovereignty over an operation that does not involve Indians but non-Indians to me is not a valid enough argument because I have an obligation under the Constitution ... to all of our citizens," McCain said. Tribal sovereignty is "overridden to some degree" by a need to protect "all citizens" from potential corruption at casinos, he added.

A labor law decision in May 2005 reflected this thinking. The National Labor Relations Board asserted jurisdiction over tribal enterprises that employ or affect non-Indians. "As tribal businesses prosper, they become significant employers of non-Indians and serious competitors with non-Indian owned businesses," the ruling, which has been heavily criticized by tribal leaders, stated. "When Indian tribes participate in the national economy in commercial enterprises, when they employ substantial numbers of non-Indians, and when their businesses cater to non-Indian clients and customers, the tribes affect interstate commerce in a significant way."

Tribes are arguing that the proper resolution of the dispute lies with the compacting process that they say limited sovereignty. In the ruling last fall, the judge gave the Colorado River Indian Tribes and the state of Arizona time to modify their compact, which has been hailed as a model for the rest of the nation. Although he said he didn't know whether the Department of Justice would appeal, McCain indicated that the tribal arguments don't carry much weight with him. "Issues of tribal sovereignty not only entail activities on Indian lands that are conducted by Indians," he said. "Ninety-nine percent of the patrons of these Indian gaming activities are non-Indians. So we have an obligation to non-Indians as well as Indians to make sure that these gaming activities are honest, straightforward and adequately regulated."

My thoughts… Gambling in America is here to stay and Indian Casinos are major players in the industry. Because of the relative infancy of tribal gaming and due to the sovereignty of Tribal Governments, complicated issues have come up and will continue to arise yearly and it may be many years until there is some sort of common platform established through court decisions and state and federal law that will create an even balance of rights between tribal sovereignty, state and local governments as well as the citizens of the communities where casinos reside. It is a work in progress and my prediction is that as tribes operate casinos they will surrender certain sovereign rights. It is already happening. They are operating businesses where the majority of patrons are non-Indian and the majority of their employees are non-Indian and in my opinion complete tribal sovereignty when dealing with casino issues is not a fair practice. Sovereignty concerning tribal affairs on reservations where casino issues are not involved should be protected and maintained.

It may be many years but I believe there will be a fair and balanced set of protocols and laws established to protect everyone…..it’s just a matter of time.

Sources:
http://www.indianz.com/News/2006/016537.asp
http://ciir.cs.umass.edu/ua/Fall2006/regplan/NATIONAL_INDIAN_GAMING_COMMISSION_(NIGC).html
http://www.indianz.com/News/2007/003628.asp