The unequivocal success of tribal gaming over the past half-century is a testament to the industry and resourcefulness of Indian tribes across the U.S., as well as to the broad-based appeal of gaming.
Starting in the 1970s, tribes used gaming to create and build wealth, asserting their sovereign right to do so free of oversight by the U.S. government. That right was affirmed by the 1987 U.S. Supreme Court Cabazon decision. But the federal government was unwilling or unable to take a hands-off approach; states too, along with non-Indian gaming interests, pressured Congress to bring additional regulatory control to bear over the growing industry.
In 1988—by then, tribal gaming was a multimillion-dollar enterprise—Congress established the Indian Gaming Regulatory Act (IGRA) and the National Indian Gaming Commission (NIGC), an agency in the Department of the Interior that would administer the act in concert with state and tribal regulatory agencies.
On its face, the mission of the NIGC is clearly supportive: in addition to the regulatory function, its stated goals based on IGRA are to provide training and technical assistance to tribal regulators, vet gaming ordinances and management agreements, investigate people and businesses that want to manage or invest in Indian gaming and keep out bad actors, and so on.
But this alliance of gaming tribes, tribal gaming commissions and the NIGC has sometimes been an uneasy one. In the early years, “We got a lot of opposition from tribes,” says Jana McKeag, of the Cherokee Nation of Oklahoma, who served as commissioner from April 1991 to December 1995. “People would yell at us—what were we doing trying to impose this regulatory structure over sovereign governments?
“They were very upset, also, that states would have some say in their gaming operations through the whole compact system. It was very new in Indian Country, new to the states, new to the Interior Department. At the time, established tribes were still questioning the constitutionality of the IGRA.”
In 1991, two tribes sued to prevent the implementation of IGRA, contending that it violated their right to self-determination. Though IGRA was deemed constitutional, many disagreed then—and continue to disagree now—about its application, and the extent of authority that should be wielded by NIGC.
Writing the Manual
“The NIGC was never very favored by the tribes, who essentially felt that regulation fell to their own commissions,” says George Skibine, of the Osage Nation of Oklahoma, who was acting commission chairman from October 2009 to June 2010. “When NIGC comes in, it’s like Big Brother looking over your shoulder, overlording something that’s within the tribe’s jurisdiction. They feel it’s an attack on their sovereignty.”
That perception can change depending who occupies the chairman’s seat. Philip N. Hogen, for example, an Oglala Sioux from South Dakota and commission chairman from December 2002 to October 2009, was seen as more of an enforcer, and “drew the ire of the all tribes,” says Skibine. Tracie M. Stevens, his successor (June 2010 to August 2013), “took a diametrically opposed view, abandoning enforcement efforts and focusing on education.”
“We had to make it up as we went along; we had no rule book,” Hogen recalls. “We developed the first training program for regulators, opened field offices, hired field staff—we were all in growth mode. I don’t say we got everything done, but the job of the chairman is to keep Congress off the back of tribal gaming and make sure they know it’s squeaky clean.”
In time, he says, “We had a good rule book and played by that rule book.”
Hogen says a hallmark of his tenure was the prevention of “gamesmanship”—non-tribal entities ingratiating themselves with tribal interests to further their own interests—and ensuring that as tribes grew and allied themselves with mammoth commercial operators, such as Harrah’s or Station, the tribes would “get a fair shake” and maintain the upper hand in their own operations.
Leaving a Legacy
Former commission chairman Jonadev Chaudhuri, who was appointed during the Obama years and served from October 2013 to May 2019, says IGRA gives commission leaders broad discretion to run the agency as they see fit—allowing them to put a personal stamp on the commission, and leave a distinct legacy.
“For some, that’s led to heavy emphasis on enforcement, for others, heavy emphasis on training,” says Chaudhuri, of the Muskogee (Creek) Nation. “I like to think that my team focused on all of the above, recognizing that we had to help maintain a secure industry and at the same time empower our partners, the front-line operators and tribal regulators. It wasn’t an either/or scenario.”
His administration “brought some of the strictest and hardest-hitting enforcement actions in the history of the NIGC,” Chaudhuri notes, “but also supported tribal regulatory bodies through training and technical assistance, building on the work of previous administrations. We didn’t measure our success by the number of enforcement actions, but by the overall health of the industry.”
While NIGC does not play an explicit part in tribal-state disputes, such as the compact renewal issue that recently caused a showdown between Oklahoma Governor Kevin Stitt and gaming tribes in that state, the commissioner has a leadership role nonetheless, he says.
“When states and tribes were at loggerheads, I looked to the letter of the law when deciding the proper approach, and also to the legal responsibility set forth in our statute, which is to promote and support self-sufficient tribal economic development and strong tribal government.
“The plain letter of IGRA is black and white in terms of Class III gaming requiring a compact, but in periods of dispute, it’s important to have lodestar guiding principles to inform agency actions. With one dispute in New Mexico, we worked with our federal partners to engage in a very short-term period of non-enforcement while the litigation played out, during which time any revenue sharing payments were put in escrow.
“I cannot say the settlement was to everybody’s liking, but we issued a letter staying our hand pending litigation, and the U.S. attorney’s office did the same.
“In moments of dispute, there’s an opportunity to lead through facilitation of dialogue or by taking a calm and measured approach.”
According to Jason Giles, executive director of the National Indian Gaming Association (NIGA) and a member of the Muskogee (Creek) Nation, tribes rightly view the NIGC’s role as secondary to that of tribal regulators.
“When NIGC was created, it was seen as an intrusion upon tribal sovereignty—the NIGC was going to ‘peek under the tent’ every so often in regards to audits and other things. But we’ve tried to take a cooperative, teamwork approach with the NIGC, and solve things together rather than going out and issuing fines for every minor infraction.
“The NIGC, unfortunately, has been more inclined to want DOJ prosecutors (in commission roles) than someone who’s managed a gaming floor. Even with something as mundane as minimum internal control standards, if you take a prosecutorial approach to enforcement, you’ll find a snake behind every rock. But if you’ve worked in the gambling industry, you might take a different approach, one rooted in the customer base and what you’re providing as a service.”
Giles is also concerned that only two of the three commission seats are currently filled, with Sequoyah Simermeyer, nominated by President Donald Trump and confirmed in November 2019 in the top role, and Kathryn Isom-Clause, appointed during the Obama administration, as commission vice-chair.
“In Indian Country, we’re trying to come up with a system to get quality tribal gaming officials to fill those slots—we have all these great gaming commissioners and professionals who could serve on the NIGC, but we need cooperation from Congress and the (president) on those appointments,” Giles says.
Skibine agrees that “neither Democrats nor Republicans have done a good job in making sure there are three members, and that’s unfortunate.” It’s unusual, he adds, that the current chairman has no apparent political affiliation. “He’s independent, not affiliated with Republicans or Democrats, and it’s very unusual for the administration to appoint a chairman who’s not a party member.”
That doesn’t mean the commission itself is independent, Skibine observes. “To me, the biggest problem from a governmental standpoint is the fact that it’s unclear whether the NIGC is an independent commission or subject to the supervision of the Secretary of the Interior. In my experience, Interior oversight of NIGC can inject political issues on the chairman and make him less independent. NIGC should be like other commissions—truly independent, without oversight of the Interior Department. But that’s not the way it is right now.”
The Road Ahead
Today, of course, the industry stands at a crossroads due to the impact of Covid-19, which caused the temporary closure of some 500 Indian gaming halls operated by more than 240 tribes in 29 states, and has jeopardized hundreds of thousands of jobs, as well as tribal economies and the well-being of tribal communities. According to a report in the Wisconsin State Journal, tribes who collectively produced $35 billion in gaming revenues last year could lose $22.4 billion this year due to the shutdowns.
Does the NIGC have a role to play in the current health and economic crisis, and in the longed-for recovery?
“No doubt about it,” says Giles, adding that the NIGC is mandated by statute to ensure the health, safety and welfare of tribal casinos.
“Before, when you thought about health, safety and welfare in the gambling industry, you might think about preventing a bar fight on your property. But this is a pandemic, and what expertise does the NIGC have with regard to epidemiology?”
Earlier this year, the NIGC launched a series of Covid-19 “Guidance Outreach” calls hosted by Simermeyer and Isom-Clause, consulting with the leaders of regional tribal associations on possible solutions, says McKeag.
“On one of the calls, I could feel Sequoyah’s and Kathryn’s hearts breaking, as tribes asked for help with cleaning supplies and medicines, these very basic needs. The job now is kind of keeping the ship operating. One person on the call was saying that people are out there, trying to take advantage of tribes, selling them snake-oil solutions and devices.”
Interestingly, she adds—reflecting the historic tensions between tribes and the NIGC—a tribal representative on the call asked if the NIGC guidelines were suggestions or directives, and if they would be subject to fines for non-compliance. “But it was just guidelines. I think the NIGC stepped up to the plate in anticipating what tribes needed to consider as they tried to reopen.”
Giles characterizes the NIGC’s Covid guidance as “taking what the CDC said and putting it out there, and also encouraging tribes to work with their state and local health officials. I think tribes uniformly would agree that their response during this has been fine, not overbearing, and more about cooperation and trying to help everybody through this pandemic.”
As always, notes Chaudhuri, the current crisis is a time for leadership, separate from statutory authority, with the NIGC “helping to facilitate dialogue among tribal nations and supporting that dialogue through technical assistance and sharing best practices.”
At the very least, tribes hope the commission, which draws its annual budget from gaming revenues, recalculates that budget in light of the coronavirus. “Revenues are going to be way down,” Giles warns. “We’re looking for them to adjust the budget appropriately, and not base their budget for 2021 on 2019 fees.”
Chairman Simermeyer was unavailable to comment for this article, but according to Giles, “We enjoyed working with former Chairman Chaudhuri’s administration, and certainly Chairman Simermeyer has given us the same open-door policy and ability to engage with the commission.”
“I was very glad when he was appointed,” says McKeag of Simermeyer, a member of the Coharie Tribe of North Carolina, a former associate commissioner who also has worked in various capacities at the Bureau of Indian Affairs. “He had served as a commissioner, and he hit the ground running.”
By the time IGRA and NIGC were set forth in 1988, tribal gaming had been an active, going concern for well over a decade, starting with paper bingo on reservations, and rapidly growing into a multimillion-dollar and then a multibillion-dollar industry. Tribes are even going global—witness Inspire, a Mohegan Gaming & Entertainment development in South Korea, and a resort project approved for the Hard Rock-Seminole organization in Athens, Greece.
The path ahead may be filled with obstacles, but Chaudhuri expresses measured optimism about the ability of tribes to pivot as necessary, and as in the past, to determine their own fortunes.
“I always recognized,” he says, “that Indian gaming was a success story not because of federal law, but because of the innovation and regulation of the primary operators of Indian gaming—and that is tribal nations.”