Economic Development
Economic Development : Gaming Regulation
Tribal Government Gaming Regulation
Federally recognized tribes are the front-line regulators of tribal government gaming. They have placed the highest priority on the security of the industry. No one has a greater interest in protecting the integrity of tribal government gaming than tribes. It is the most precious economic resource they've ever had. Tribes have agreed to allow the federal government to play a role in overseeing tribal government gaming, but they will never rely on the federal government to be the primary protector against crime.
Tribal government gaming is already subject to more stringent regulation and security controls than any other type of gaming in the United States. Tribal gaming operations are regulated at four distinct levels - tribal government, state government, the National Indian Gaming Commission, and federal government agencies such as the U.S. Justice Department, the FBI, the IRS and the Bureau of Indian Affairs.
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Tribes have established their own gaming commissions and developed tribal police forces and court systems to combat crime. Many tribes have invested heavily in high-tech surveillance equipment. Because tribal government gaming (Class III) is a relatively new industry, only new "state of the art" electronic equipment and machines are in use. Tribes have established industry standards and internal controls. Tribes have more personnel regulating tribal casinos than regulate Nevada casinos.
Compacts between states and tribes give states some regulatory power over tribal government gaming, though IGRA recognizes that the federal government has primary responsibility for government-to-government relations with sovereign Indian nations.
The Indian Gaming Regulatory Act (IGRA) established three classes of tribal government gaming:
Class I - social games solely for prizes of minimal value or traditional forms of tribal government gaming as a part of tribal ceremonies or celebrations;
Class II - bingo and related games, including pull tabs, lotto, punch boards, tip jars, instant bingo and some card games, excluding house banking card games such as blackjack and baccarat; and
Class III - All forms of gaming that are not Class I or Class II, including slot machines and blackjack.
The National Indian Gaming Commission has extensive regulatory requirements for tribal government gaming operations and must give final approval to all tribal casino management contracts.
Class I gaming is regulated solely by tribes. Class II gaming is regulated solely by tribes if they meet conditions set forth in IGRA. Regulation of Class III gaming is governed by tribal-state compact.
In California, the tribal government gaming regulatory structure looks like this:
Tribal Government
- Establishes Tribal Gaming Commission
- Provides front-line regulation of tribal government gaming, including security and surveillance measures
- Manages tribal government gaming operations, adopts ordinances and issues licenses for gaming operations and employees
- Negotiates compacts with state for Class III gaming
- Provides protection and law enforcement
State of California
- Negotiates compacts with tribes for Class III gaming, which includes provisions for environmental issues, labor ordinance enforcement, security, infrastructure and other matters
- Enforces provisions of the compact, which often include background checks of employees and management company personnel.
California Gambling Control Commission (CGCC)
- Holds jurisdiction over the operation, concentration, and supervision of gambling establishments, and over all persons or things having to do with the operations of gambling establishments in the state of California.
- Regulates gambling activities in the state, setting policy, establishing regulations, issuing licenses, serving as the adjudicator for license denials recommended by the Division of Gambling Control, and any other related items and issues that may come before the Commission.
- Current commission members include:
o Dean Shelton, Chairman
o Michael Palmer
o J.K. Sasaki
o Arlo Smith
California Department of Justice - Division of Gambling Control
- Regulates legal gambling activities in California to ensure that gambling is conducted honestly, competitively and free from criminal and corruptive elements.
- Responsible for tracking the identity, prior activities, and present location of all gambling enterprise employees, and for ensuring that all gaming enterprise employees hold a valid work permit.
- Investigates the qualifications of individuals who work as Key Employees in the Tribal Casinos, Vendors who sell Gaming Resources to the Tribes, as well as Financial Sources to determine whether they are suitable pursuant to the Gambling Control Act (Act) (867, statutes of 1997.)
Department of the Interior - Bureau of Indian Affairs
- Rules on land-into-trust issues
- Rules on plans for allocation of tribal government gaming revenues
- Conducts investigative studies
- Approves tribal-state compacts
National Indian Gaming Commission (NIGC)
- Approves management contracts
- Regulates gaming
- Conducts background checks and reviews terms of contracts
- Has the authority to enforce civil penalties and impose fines up to $25,000 per day and to order establishment closed
- Current commission members include:
o Philip N. Hogen, Chairman
o Nelson V. Westrin, Vice Chairman
o Cloyce V. Choney, Commissioner
Department of Justice - Federal Bureau of Investigation
- Enforces criminal violation of gaming laws
- Conducts background checks of key gaming employees
- Conducts investigative studies
Internal Revenue Service
- Enforces all applicable federal personal income and payroll tax codes
