Controversial tribal casino rules finalized

FROM THE ARCHIVE

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THURSDAY, JUNE 27, 2002

Federal regulators have approved hundreds of pages of rules affecting the $10 billion Indian gaming industry despite lingering questions over their legality.

In a Federal Register notice being published today, the National Indian Gaming Commission announces final changes to one of the major initiatives of Clinton administration appointees who are leaving their posts. Chairman Montie R. Deer and his two peers approved the regulations on June 17.

Developed in close consultation with Indian gaming representatives, the rules reflect more than a year of work. A series of national meetings were held, followed by an extended public comment period.

According to the NIGC, the final Minimum Internal Control Standards, or MICS, reflect that federal-tribal partnership. Changes that tribal regulatory commissions suggested were often adopted by commissioner Teresa Poust, who was the lead on the issue.

Despite the positive relationship, more than half of the tribes that worked with the NIGC refused to acknowledge the ultimate legality of the rules. Industry leaders -- including the National Indian Gaming Association, which represents more than 150 casino operations -- in fact call for a full-scale repeal of the MICS, and other Clinton-era mandates, in favor of sole tribal regulation.

"Indian people are primary regulators and the best regulators," said NIGA chairman Ernie Stevens at a gaming conference this month. "Indian Country has honest, hard working operations."

The standards in question describe how tribes are to operate casinos on a daily basis. Everything from the counting of cash to the handling of games is covered in nearly 300 pages.

But there is doubt whether the NIGC has the authority to require tribal compliance, especially over the lucrative Class III casino market. Class III games include slot machines, card games and related offerings.

The Clinton administration's view was that the rules are integral to the NIGC's Congressional mandate even though federal gaming law never spelled out that particular role clearly. In fact, past leaders of the commission testified in support of legislation that would have authorized the rules.

When those packages repeatedly failed to pass, the administration in 1999 took a pro-active role and asserted its right to do what Congress couldn't. The first round of MICS were born and led to the establishment of other regulations tribes have resisted.

A closely watched case, however, could tip the scales to the tribes. A Department of Interior judicial officer in May ruled that the MICS impeded tribal sovereignty over Class III games.

The NIGC overruled the decision, which was advisory in nature, but the Arizona tribe which brought the case will be able to seek federal court review after other issues are sorted out.

In the meantime, tribes have nearly a year to comply with the new mandates, and go beyond them if necessary. Tribes, however, can defer implementation without asking for NIGC approval.

The rules become final in 30 days.

Relevant Documents:
Minimum Internal Control Standards; Final Rule (6/27)

Relevant Links:
National Indian Gaming Commission - http://www.nigc.gov
National Indian Gaming Association - http://www.indiangaming.org