Joseph Webster: Tribes assert sovereignty over Class II gaming

When Congress enacted the Indian Gaming Regulatory Act in 1988 (IGRA), it included an important provision to allow for self-regulation of Class II gaming by tribal governments that established a record of successful gaming regulation. Tribes that achieved a certificate of self-regulation would be responsible for most aspects of gaming regulation, with only limited oversight by the National Indian Gaming Commission (NIGC). Congress anticipated that this transfer of regulatory responsibilities would shift the cost of regulation to the tribes, and consequently included language in the IGRA to cap the fees paid to the NIGC by a self-regulating tribe.

Unfortunately, the promise of self-regulation went unrecognized for many years. In 1998, the NIGC promulgated implementing regulations for self-regulation. Those regulations, found at 25 C.F.R. Part 518, made it extraordinarily difficult for tribes to achieve self-regulation status, and once achieved, imposed requirements that essentially maintained and arguably expanded the NIGC's regulatory role. For example, the NIGC imposed onerous submission requirements and effectively added to the statutory criteria to receive a certificate of self-regulation. Further, the regulations required tribes to re-satisfy the requirements for self-regulation on an annual basis, subjecting self-regulating tribes to stringent ongoing review and oversight by the NIGC. The NIGC also asserted in the regulations that it would maintain much of its regulatory oversight role with respect to self-regulating tribes, notwithstanding the clear language to the contrary in the IGRA. Finally, the NIGC imposed a tribal certification requirement regarding the use of gaming revenues that was above and beyond any requirement applicable to tribes that did not self-regulate. In short, there was little incentive for most tribes to go through the process necessary to achieve a certificate of self-regulation.