程阳：The Indian Gaming Industry

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http://www.nigc.gov/Portals/_default/Skins/NIGC/assets/common3/spacer.gifIndian Gaming Industry" TITLE="程阳：The Indian Gaming Industry" />Although tribal victories over the governmental and cultural oppression in the 1950s yielded a dynamic transformation, economic success fell short in comparison [4]. Unemployment was down and personal income had increased, but only a handful of tribes had made economic changes. Their strides were spotty and fluctuated greatly from each Indian reservation . This was happening because, for most tribes, their lands were not economically productive, infrastructure was poor, and they were far away from prospering markets of large populations. In order to address the issue of poverty, Indian tribes were required to fuel some type of economic development. Indians sold some of their tribal land to prospecting non-Indians in order to stimulate economic growth, but tribal gaming has proved to be the single largest amount of income in the Indian community. However the United States government intervened in tribal affairs throughout the rise of Indian gaming.

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Controversy arose when Indians began putting private casinos, bingo rooms, and lotteries on reservation lands and began setting gaming prizes which were above the maximum legal limit of the state. The Indians argued for sovereignty over their reservations to make them immune from state laws such as Public Law 280, which granted states to have criminal jurisdiction over Indian reservations[5]. States were afraid that Indians would have a significant competitive edge over other gambling places in the state which were regulated, which would thus generate a vast amount of income for tribes.

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In the late 1970s and continuing into the next decade, the delicate question concerning the legality of tribal gaming and immunity from state law hovered over the Supreme Court [6]. The Court addressed the potential gambling had for organized crime through the Organized Crime Control Act of 1970. A report by the Department of Justice presented to the Senate Select Committee on Indian Affairs on March 18, 1992 concluded that through several years of FBI investigation, that organized crime had failed to infiltrate Indian gaming and that there was no link between criminal activity in Indian gaming and organized crime [7]

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Under the leadership of Howard Tommie, the Seminole Tribe of Florida built a large high-stakes bingo building on their reservation near Fort Lauderdale, Florida. The tribal Chairman Howard Tommie executed the leadership for this construction and planned the bingo hall to be opened six days a week, against Florida state law which only allows two days a week for bingo halls to be open and going over the maximum limit of $100 jackpots [8]. The law was enacted from the charity bingo limits set by Catholic Churches. The sheriff of Broward County, where the Indian reservation lies, made arrests the minute the bingo hall opened, and the tribe sued (Seminole Tribe v. Butterworth) the county stating that Indian tribes have sovereignty rights that are protected by the federal government from interference by state government. A District court ruled in favor of the Indians, citing Chief Justice John Marshall in Worcester v. Georgia. Here began the legal war of Indian gaming with a win for the Seminoles.

the National Indian Gaming Commission

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In California, the Cabazon Band of Mission Indians near Indio, California, were extremely poor and did not have much land because of neglected 1850's treaties by state senators. As Stuart Banner states, the Cabazon Band and the neighboring Morongo Reservation had "some HUD buildings and a few trailers, but that was about it [9]. There was nothing really there. The people simply didn't have a lot." Casino operations proved to be what they turned to. The Cabazons opened bingo and poker halls in 1980, but the Indio police and the Riverside County Sheriff shut down the gambling halls and arrested numerous Indians while seizing any cash and merchandise held in the tribe's possession. The Cabazon Band sued in federal court (California v. Cabazon Band) and won, just like the Seminole Tribe in Florida[10]. Although the tribes won in the lower courts, the Supreme Court reviewed the case in 1986 to reach a decision over whether Indian reservations are above state law. The Court again ruled that Indian gaming was to be regulated exclusively by Congress and the federal government, not state government; with tribal sovereignty upheld, the benefits of gaming became available to many tribes.

Class III Indian gaming became a large issue for the states and federal government, because of these court cases, as Congress debated over a bill for Indian gaming called the Indian Gaming Regulatory Act. Gaming in general is divided into 3 classes. Class I and Class II gambling are traditional Indian gaming such as bingo halls, poker halls, and lotteries; this does not require a license to open these up. Class III gambling are with high jackpots and high-stake games such as casinos, jai alai, and racetracks, and states feared that organized crime would manifest from the Indian Class III gaming on their reservations. In 1988 Congress passed the Indian Gaming Regulatory Act (IGRA)(signed by President Ronald Reagan) which kept tribal sovereignty to create casino like halls, but the states and Indians must be in Tribal-State compacts and the federal government has the power to regulate the gaming[11]. These compacts have been used by state officials to confiscate Indian casino revenue which serves as a "special" tax on Indian reservations. Essentially, the tribes still have "exclusive right" to all class of gaming except when states do not accept that class or it clashes with federal law[12]. One agreement with the Mashantucket Pequot Tribe's Foxwoods Casino and Connecticut promises the state $80 million or 25% of their annual slot revenue. For the 10 years Connecticut has shared the revenue with Foxwoods, the state has received more than $1.7 billion from Foxwoods alone[13]

When President Reagan signed the IGRA, Indian gaming revenue skyrocketed from $100 million in 1988 to $16.7 billion in 2006[14] Following the IGRA, the National Indian Gaming Commission was created as a federal agency in 1988 to regulate high-stakes Indian gaming.

The Commission consists of three members: a chairman who is appointed by the U.S. President with consent of Senate, and two associate members appointed by the Secretary of the Interior.[15]. Each member is subject to a three year term and must pass a detailed background check by the U.S. Attorney General.

The NIGC withholds certain powers over Class II and Class III gaming. These include budget approval, civil fines, fees, subpoenas, and permanent orders. The NIGC monitors Class II gaming on Indian lands on a continuing basis through inspection, investigation, access to records, and contracts[16]. As for Class III gaming, all contracts must be approved by the chairman of the NIGC. 200 of the 562 federally recognized tribes created Class III gaming of large casinos and high jackpots[17].

This rise of gaming not only brought great revenue, but also corruption. In January 2006, a court case involving lobbyists convicted of felonies such as conspiracy, fraud, and tax evasion. This was known as the Jack Abramoff Indian lobbying scandal. These lobbyists, Jack Abramoff, Ralph Reed, Jr., Grover Norquist, and Michael Scanlon, bribed members of Congress when lobbying for Indian casinos then they over priced their Indian clients; this generated around $90 million dollars in fees from the Indians [18].

The most recent Indian gaming statistics, provided by the National Indian Gaming Commission (NIGC), indicate that there are approximately 400 Indian gaming establishments in the United States. These casinos are operated by approximately 220 federally recognized tribes and offer Class I, Class II and Class III gaming opportunities. The revenues generated in these establishments is close to $18.5 billion. Currently, the largest casino in the United States, Foxwoods Casino, is owned by the Mashantucket Pequot Tribe and located in Ledyard, Connecticut. The second largest casino in the U.S. is located a few miles away, Mohegan Sun. Tribal casinos located in the eastern United States generated roughly $3.8 billion in FY02. Those located in the Central United States recorded gross revenues of approximately $5.9 billion, while those located in the Western United States generated close to $4.8 billion. Most of the revenues generated in the Indian gaming industry are from Indian casinos located in, or near, large metropolitan areas. Currently, 12% of Indian gaming establishments generate 65% of Indian gaming revenues. Indian gaming operations located in the populous areas of the West Coast (primarily California) represent the fastest growing sector of the Indian gaming industry. As suggested by the above figures, the vast majority of tribal casinos are much less financially successful, particularly those in the midwest and great plains. Many tribes see this limited financial success as being tempered by decreases in reservation unemployment and poverty rates, although socioeconomic deficits remain.

It is important to note that currently there are 562 federally recognized tribes in the United States, not all of which have chosen to game. However, it is safe to assume that the tribal gaming industry will continue to grow in the near term, as new casino and resort developments are built by tribes and America's general passion for opportunities to gamble (Las Vegas, poker tours, Internet, etc.), continues to flourish. There are currently a number of lawsuits pending which challenge the Indian Gaming Regulatory Act on constitutional grounds (see e.g. Warren v. United States)

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