Isleta Pueblo owns and operates the Isleta Resort and Casino in New Mexico. Photo: I-5 Design & Manufacture

Pueblo tribes dispute state's demand for $40M in gaming revenues

The state of New Mexico continues to try and squeeze more and more gaming revenues out of tribes.

Tribes already share a percentage of their revenues under Class III gaming compacts that were reluctantly approved by the Bureau of Indian Affairs. The state now claims Isleta Pueblo, Sandia Pueblo and Tesuque Pueblo owe an additional $40 million in "free play" credits, The Santa Fe New Mexican reported.

“This claim makes no sense,” tribal leaders said in a statement to the paper.

The tribes are hoping a federal judge agrees. They filed a complaint against the state on Monday, arguing that "free play" credits should not be treated as "revenue" under their compacts.

"By unilaterally requiring that free play credits be treated as revenue, the defendants are imposing an exaction on each Pueblo’s use of free play that violates the per se rule of federal law that bars state taxation of an Indian tribe unless Congress has authorized such taxation in terms that are unmistakably clear," the complaint reads.

The BIA allowed Sandia Pueblo's compact to take effect in April 2016. Tesuque Pueblo's agreement went into effect in October 2015 while Isleta Pueblo's became effective in July 2015.

The BIA, however, said any provisions that are not consistent with the Indian Gaming Regulatory Act are not considered legal. That could include the "free play" credits, The New Mexican reported.

New Mexico is home to more tribes with "deemed approved" compacts than any other state -- 16 total. The holdout is Pojoaque Pueblo, whose leaders refuse to sign an agreement in protest of the state's revenue sharing demands. The tribe's ability to keep offering Class III games in the absence of a compact is the subject of ongoing litigation.

Read More on the Story:
State: Pueblos need to pay for free play (The Santa Fe New Mexican 6/21)