April 19, 2019

Debate rages as states seek control of reservation casinos > Indians bank on gambling for stability

PHOENIX — Reservation gambling, an economic godsend for financially strapped Indian tribes but a political thorn in the side for state governments, has become a states’ rights battleground.

Forced by federal law to negotiate compacts that have allowed Indian casinos to spring up across the country, some states have begun to fight back.

At least six states have successfully challenged the 1988 federal Indian Gaming Regulatory Act in federal court — but others have lost. Lawsuits are pending in several other cases.

The governors of Colorado, Nevada, Kansas, Rhode Island and Arizona are to meet Monday with Interior Secretary Bruce Babbitt to discuss their problems with Indian gambling.

Arizona and Wisconsin are among states scrambling to change their laws to strengthen their hand as they try to limit the spread of reservation gaming.

There also is a movement spearheaded by the National Governors Association to amend the Indian gaming act, which forced states to negotiate gambling compacts with Indian tribes.

States that allow any form of what the act designates as “class three” gaming — lotteries, most casino games and parimutuel wagering on horse and dog races — are required by the act to negotiate compacts to allow the same games on the reservations.

Indians have used loopholes in some state laws, such as charity “casino night” fund-raisers, to force the states to the bargaining table.

The federal law also has been interpreted in Arizona and Wisconsin as allowing Indians to have virtually unlimited casino gambling if the state has any form of “class three” gaming, even if it’s only a lottery.

Gov. Fife Symington on Friday signed a law that bans all casino-type gambling in Arizona, including charity events. The measure does not affect the state’s lottery or wagering on horse and dog races, and tribes would be allowed to continue operating similar games.

Indian gambling has mushroomed into a multibillion-dollar industry. The Interior Department’s Bureau of Indian Affairs reported that 54 tribes in 18 states have negotiated gambling compacts.

The operations range in size from tiny ones like a portable building on the Tesuque Pueblo in New Mexico to the huge Ledyard casino in Connecticut. The Tesuque center, just north of Santa Fe, houses a dozen slot machines. Ledyard took in an esimated $140 million in its first year and soon could become the largest single gambling complex in the nation.

Babbitt, who opposed Indian gambling when he was governor of Arizona, alarmed state officials when he said in Phoenix last month that a state that sanctions any form of gambling, including state-sponsored lotteries, cannot impose any restrictions on Indian gambling.

The next week, he calmed governors’ fears somewhat when he wrote to Nevada Gov. Bob Miller that he has not prejudged any state’s case.

“What I have done is make clear my intention to uphold the letter and spirit of the Indian Gaming Regulatory Act,” Babbitt said. “That act indicates that Indian gaming should be linked in some way to the kinds of gaming allowed under state law.”

“That is, the act clearly indicates a primary and substantial role for the states,” he added.

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