A National Indian Gaming Commission regulatory proposal that could have cost tribes across the country more than a billion dollars a year is on hold, but not likely to go away.
On Friday, NIGC Chairman Philip Hogen said he does not plan to look aside as new technology increasingly changes the face of bingo-type Class II gambling machines, making them look more like Las Vegas-style Class III slot machines.
The NIGC, the regulatory agency overseeing tribal casinos, announced on Wednesday it would be "putting aside" two of four regulatory proposals. The most controversial one would have made Class II gambling machines illegal because they allegedly defy a 1988 Indian Gaming Regulatory Act definition.
"It's kind of a halfhearted gesture by chairman Hogen," said chairman James Steele of the Confederated Salish and Kootenai Tribes. "The whole thing needs to be pulled. It's more of an attempt to placate tribes than do what the tribes asked."
Chairman Ernie Stevens of the National Indian Gaming Association, the advocacy organization for tribe-owned casinos, credited tribal leaders and their gaming commissioners for halting the contentious regulations.
In a statement, Stevens said NIGA and tribes will work with the commission on the remaining Class II proposals. He said work could be done to develop acceptable technical and minimum internal control standards that wouldn't create a "severe economic hardship" for tribal communities.
An NIGC economic impact study showed tribal governments could lose approximately $1.2 billion a year under the agency's proposals. And tribes would have to pay compliance costs of up to $347.9 million, according to the NIGA statement.
Meanwhile, the commission is moving forward with control standards giving the regulatory agency more power to "follow the money," from the time it goes into a gambling machine to the time it reaches the bank, said Hogen.
Overall, Class II gambling in Indian Country represents an estimated $4 billion industry. The Seminole Tribe of Florida has earned more than $1 billion in Class II revenues. In 1979, the Seminole became the first federally recognized tribe to operate a high-stakes bingo operation, leading the way for a gambling revolution across Native America.
Today, reservation bingo players do more than black out numbers on a sheet. Class II machines allow for competition among multiple players on reservations across the country, whereas a typical Class III game pits a single player against a machine.
For some tribes, the only gambling revenue they earn is from Class II games, whereas the high-stakes revenue is earned from Class III machines. Tribes who don't have Las Vegas-style gambling typically have not agreed with the state on an acceptable gambling compact. Or the state refuses to engage in Class III games.
The Blackfeet Nation and the Salish and Kootenai are the only two tribes in Montana - out of seven reservations - that receive gaming revenue exclusively from Class II machines.
Chairman Steele said Class II games allow his tribe to negotiate directly with the federal government instead of entering into an agreement with the state. The state compacts, a requirement of the Indian Gaming Regulatory Act, usually call for tribes to share money.
"IGRA was meant for economic development among the tribes," said Steele. "It was not meant for state-regulated agencies to receive revenue."
Meanwhile, in testament to keeping the controversial Class II proposals alive and before the National Indian Gaming Commission, Hogen on Wednesday sent a disapproval letter to the mayor of Metlakatla Indian Community, the only federal Indian reservation in Alaska.
The community had asked the commission to approve new "one-touch" bingo machines for the tribe's small casino on the Annette Island Reserve. But Hogen said the proposed one-touch machines demand Class III certification.
With 50,924 Class II machines in operation throughout Indian Country, the Metlakatla community operates the fewest with only 30 machines, compared to 535 machines in Montana and 30,044 machines in Oklahoma.
On Friday, Sol Atkinson, a Metlakatla tribal council leader, said the community will appeal the NIGC decision to ban their new bingo machines.
Reporter Jodi Rave can be reached at 800-366-7186 or firstname.lastname@example.org