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Supreme Court decision seen as hindrance for casino financing


The U.S. Supreme Court decision in Salazar v. Patchak will have an effect on financing for tribal casinos, according to Fitch Ratings.

The decision allows just about anyone to challenge a land-into-trust application. Historically, lawsuits were filed by state and local governments and people directly affected by a gaming operation, such as adjacent residents or landowners.

The Supreme Court, however, said the land-into-trust regulations that were developed under the Indian Reorganization Act recognize a wide "zone of interests." A person who lives in the general area of a casino, for example, could file a lawsuit.

The decision also loosened the time frames for challenges to a land-into-trust application. Normally, lawsuits must be filed within 30 days but the Supreme Court said the Administrative Procedure Act -- which provides for a six-year statute of limitations -- governs.

As a result, Fitch Ratings said the decision will have ''several key credit implications for the gaming sector." Companies that partner with tribes may be reluctant to provide financing if a land-into-trust decision remains vulnerable for years.

Get the Story:
Ruling could slow development of some Indian casinos (VegasInc 6/19)
Supremes’ Ruling Opens Floodgates to Challenges of Indian Land Trust Acquisition (Indian Country Today 6/19)

Supreme Court Decision:
Salazar v. Patchak (June 18, 2012)

Oral Argument Transcript:
Salazar v. Patchak (April 23, 2012)

DC Circuit Decision:
Patchak v. Salazar (January 21, 2011)

Related Stories:
Turtle Talk: Commentary on Supreme Court land-into-trust case (6/19)
Non-Indian behind Gun Lake casino challenge applauds decision (6/19