Tribal leaders sent three clear messages to the Senate Committee on Indian Affairs at a hearing on Internet gaming: They want Congress to enact federal legislation that will provide a single set of Internet gaming regulations across the country; the legislation must adhere to the principles unanimously adopted by National Indian Gaming Association (NIGA) members; and the National Indian Gaming Commission (NIGC) should provide regulatory oversight as it does for brick-and-mortar facilities.
The SCIA’s Chairman Sen. Daniel Kahikina Akaka opened the committee’s Oversight Hearing on the Regulation of Tribal Gaming: From Brick & Mortar to the Internet on Thursday, July 26, with his characteristic greeting, “Aloha and welcome to you all!” He reminded the committee and audience that Indian gaming is a $27-plus billion industry that now comprises 40 percent of the total gaming industry in the United States and provides hundreds of thousands of jobs for non-Indians as well as funding education, health care and housing through tribal governments. “With these types of economic tools comes great responsibility,” Akaka said. “Tribes are the first regulators for tribal gaming. We in Congress—and especially on this committee—also have a responsibility to ensure that tribal views and priorities are part of any legislation that could impact tribal gaming,” he said.
The committee has held a number of hearings on Internet gaming but this was the first since a December 2011 Department of Justice (DOJ) opinion that opened Internet gaming, with the exception of sports betting, to tribes and states. Since then Delaware has legalized all forms of online gaming, New Jersey’s bill unanimously passed a state senate committee and will go to a vote in the fall, and Nevada enacted Internet gaming regulations in 2011 and began accepting applications for online operator gaming licenses this year. Other states are also exploring online gaming as a way to bolster sagging state revenues. The Pascua Yaqui Tribe’s Casino Del Sol already has become the first land based casino in the U.S.—as well as the first Indian country casino—to offer free online gaming through its website, beginning in August. The tribe will be well positioned to convert to pay-for-play when such legislation is enacted.
The vision of states creating a “patchwork” of different regulatory systems all over the country is worrisome to tribal leaders. “Tribes should be extremely hesitant to entrust their economic futures to the tender mercies of the 5-0 states, many of whom are still in financial crises and looking for new sources of revenues,” Mohegan Tribal Council Chairman Bruce “Two Dogs” Bozsum said. He said the Mohegan Tribe has done everything in its power to prepare for Internet gaming while protecting tribal governments and the commerce they depend on. “We will never forget that our sovereignty is not negotiable,” Bozsum said.
The Mohegan Tribe participated with “our fellow tribes” with the NIGA and the National Congress of American Indians to develop a unified position on Internet gaming for Indian country, Bozsum said. He compared the current situation with the aftermath of the 1987 Cabazon case, which opened the door to Indian gaming. Instead of allowing tribal gaming to evolve overtime creating a patchwork of regulations subject to ongoing litigation and “the changing whims of political leadership,” Congress and some tribal leaders forged the 1988 Indian Gaming Regulatory Act (IGRA), Bozsum noted. “I believe in the wake of the game-changing DOJ opinion on Internet gaming, Tribal leaders and federal legislators should follow the same approach,” Bozsum said.
Glen Gobin, secretary of the Tulalip Tribal Council told the committee that his nation’s position opposing Internet gaming has changed since the Justice Department opinion has provided the opportunity for states to participate in internet gaming. “Tribes must have equal footing to participate . . . and compete while protecting and respecting tribal sovereignty,” Gobin said. The Tulalip secretary noted that the IGRA had anticipated changes in gaming, including electronic, computer and other technological advances, although the ability to fully access the internet gaming market may be subject to interpretation. “Clarifying legislation will minimize conflict and litigation, which often puts Tribes and states at odds,” he said. Gobin said the six principles developed by NIGA are “critical for Indian country” because they respect tribal sovereignty. “Their principles represent core values that respect tribal sovereignty,” Gobin said. According to the principles, any legislation must assure that: sovereign Indian tribes have the right to operate, regulate, tax and license Internet gaming; Internet gaming must be available wherever it’s not prohibited; Indian gaming revenues are not taxable; state compacts and IGRA must be respected; IGRA must not be opened for amendments; and Internet gaming must provide economic benefits for Indian country.
Gobin said that Tulalip believes—as do other tribes—that only the NIGC has the knowledge and experience to oversee internet gaming for the tribes. “The NIGC is an independent agency, able to review, amend, and can promulgate regulations in an effective and timely manner. It has over 20 years of extensive regulatory experience in gaming, and it is the only federal agency with that experience,” Gobin said.
Elizabeth Lohah Homer (Osage), an Indian law attorney gave a passionate endorsement of the NIGC, where she formerly served as vice chair for three years as well as stints with the Justice and Interior departments. Homer, like Bozsum, also compared the current era with the late 1980s prior to the enactment of IGRA. “It’s an exciting time, but it is a challenging one,” Homer said. She told committee members that although the technology of Internet gaming is new, the underlying legal and policy issues are familiar. She urged the committee to consider that the NIGC has a mature, effective gaming regulatory structure already in place and functioning. “Any legislation that would operate to bifurcate federal regulatory oversight responsibilities between the NIGC and another federal agency should be avoided as it would create uncertainties; increase the potential for inter-agency conflict; and subject tribal governments to oversight by federal personnel inexperienced in Indian Affairs, Indian law and policy, the federal-Indian relationship, and the regulation of gaming. Having two regulatory agencies regulating essentially the same function would be redundant and problematic,” Homer said.
NIGC Chairwoman Tracie Stevens gave the committee an overview of the progress the agency has made in developing meaningful consultation and relationships with the tribes, training and technical assistance, regulatory review, and the way the agency operates. The fact that tribal leaders are so supportive of the agency attests to the improvements that have been made under Stevens’ leadership in the past four years.
“How we doing on compliance?” Sen. Tom Udall (D-NM) asked Stevens. “I think we’re doing fairly well,” Stevens said. “Tribes are coming to us when they need technical assistant and training. We have staff on the ground that are always willing to help. We’re working with tribes frequently to make sure the regulations are relevant and provide regulators with the tools they need to regulate.”
Stevens would not be pinned down on whether NIGC would have the capacity to regulate Indian Internet gaming. “Well, without legislation it’s hard to say, but I will say we’re the only federal agency that is solely dedicated to regulating Indian gaming. We have a well trained staff, experienced professionals who are well versed in Indian gaming.”
Asked by Akaka if the NIGC is sufficiently funded at $18 million, Stevens said she believes it is.
Watch video coverage of the SCIA hearing here.