Tribal gaming haves and have-nots

Executives of Seven Circle Resorts of Denver, Colorado gathered with the Standing Rock Sioux Tribe in 1993 to sign a deal to manage the Indian nation’s Prairie Knights casino, then under development near Fort Yates, North Dakota. The visitors came loaded with cash.

“Their idea was to give us money” in exchange for 35 percent of the casino revenues, recalls a tribal leader who requested anonymity. “They were all about the money. They were going to bus workers in from Bismarck and Mandan.

“We told them, ‘You don’t understand. We want the jobs.’”

A tribal-owned company took over management of the casino in 2002. Seventy percent of about 500 workers at Prairie Knights and a second casino, Grand River, are enrolled members of the tribe.

Unfortunately, gaming has not been the panacea for some 9,000 citizens of Standing Rock’s remote, 2.3 million-acre reservation. Unemployment remains at 71 percent, according to tribal statistics. And even among those with jobs, 62 percent live below federal poverty guidelines.

Meanwhile, 500 miles away, 480 citizens of the Shakopee Mdewakanton Sioux Community near Minneapolis-St. Paul are each getting $84,000 a month from the tribe’s Mystic Lake, Little Six and Canterbury Park casinos. Few have jobs or, for that matter, need to work.

“We have 99.2 percent unemployment,” the late tribal President Stanley Crooks quipped in a 2012 interview with the New York Times. “It’s entirely voluntary.”

 

Cash Cow or Job Generator?

The emergence 30 years ago of American Indian casinos continues to generate unprecedented social and economic progress on many of the 326 reservations and rancherias held in trust by the U.S. Department of the Interior.

Some 244 tribes own 484 gambling facilities in 28 states, an industry that last year generated $31.2 billion, according to the National Indian Gaming Commission (NIGC), which audits tribal government casinos.

Most economically deprived Indian communities benefit at least to some degree from gambling, which is generating jobs and helping fund government services, housing, health care and education.

But the widely held notion the nation’s 2.9 million Native Americans are flush with casino cash is false. As is the case with the Standing Rock and Shakopee reservations, there are definitely haves and have-nots in Indian Country.

“The stereotypes out there—that Indians are living in squalor on the reservations or that they’re all rich from casinos—neither one can explain the whole story,” says Anton Treuer, author and professor of Ojibwe language at Bemidji State University. “It’s all very complicated.

“Poverty remains pervasive,” he says, particularly on large, remote reservations in the Midwest, Great Plains, Southwest and Mountain States. “The same is true of unemployment. In some places, though, the impact of casinos has been stunning,” Treuer says of several lucrative gambling resorts on primarily urban Indian reservations.

“It’s not like rising tides have lifted all boats.”

The NIGC no longer profiles the size and income of tribal operations, which for 2015 showed a significant revenue disparity between a few dozen lucrative urban casinos—many owned by small-enrollment tribes—and marginal casinos on large, rural and remote reservations.

Thirty-three Indian casinos generated nearly half the revenue won by tribes nationwide in 2015, according to the NIGC. Eighty-four facilities generated 72.9 percent of the win, or $22.7 billion, leaving nearly 400 operations to divvy up the remaining $7.3 billion.

About a fourth of the nationwide win went to mostly small-enrollment tribes in California, according to NIGC and other sources.

California and Oklahoma generated 40 percent of the nationwide revenues in 2015, according to economist Alan Meister, author of the Indian Gaming Industry Report. Toss in Florida, Arizona and Washington, and Meister can show five of 28 states generating 63 percent of the casino win.

“While on average there have been large improvements, the effect of Indian gaming varies tremendously across tribes,” according to a 2015 paper by the Harvard Project on American Indian Economic Development.

“Some tribes have had spectacular successes; others have found gaming to be a small part of their economic portfolio and of limited importance to their tribal government revenues and communities.”

“The true picture, I think, is one of diversity,” says an indigenous Capitol Hill lobbyist who requested anonymity.

Unfortunately, in politics, perception is reality. Gambling and the myth of the rich Indian has hijacked federal Indian policy, muddling legislative efforts dealing with re-acquiring ancestral lands, federal recognition of Indian groups and other indigenous issues.

Indian Health Services, Housing and Urban Development projects and other entitlement programs growing out of treaty agreements are being scrutinized by Republicans on the Hill grasping federal budget austerity agendas.

Meanwhile, tribal efforts to acquire land for housing, schools, health clinics and government infrastructure is being framed on Capitol Hill as a gambling issue by elected officials and bureaucrats who suspect every land-trust application will result in a new casino.

“It’s kind of a double-edged sword,” says Denise Desiderio, policy director for the National Congress of American Indians. “Financial gains from gaming have allowed tribes greater access to policymakers. It’s enabled tribes to have a greater impact on issues such as health care.

“Along with that is the perception gaming is what all tribes do—that tribes are all getting rich from casinos and all lands are tied to gaming,” she says, a notion that has interfered with efforts to re-acquire ancestral lands lost through federal tribal termination and allotment policies.

“It’s a bit of a trade-off,” Desiderio says. “We need to keep trying to balance all that out.”

 

Getting at the Truth

To quantify the true impact of gambling in Indian Country, one need follow the money and the jobs. But the process is made difficult by the lack of transparency among most tribal governments. Tribes often do not disclose financial information, employment, enrollment and other data needed to empirically gauge the significance of gambling on indigenous communities.

U.S. Census and labor statistics are complicated and confusing, particularly when census areas and tribal populations overlap reservation borders. Unemployment is combined with those not available for employment.

According to the 2010 Census, 5.2 million people identified themselves as American Indian and Alaska Native, often in combination with other races. Of the total, 2.9 million people identified as American Indian or Alaska Native alone. Roughly a third of indigenous Americans live on or near reservations.

Regional unemployment figures for persons self-identified as Native Americans in 2013 compiled by the Economic Policy Institute ranged from 8 percent to 17 percent, roughly twice the figure for non-Indians.

But Interior Department labor statistics for 2013 show about half of 1.97 million Native Americans living on or near reservations are working full- or part-time. In several states—Alaska, Arizona, California, Maine, Minnesota, Montana, New Mexico, North and South Dakota and Utah—employment remains far below 50 percent.

Poverty levels on or near Indian lands range from 43-47 percent in South Dakota to 30-37 percent in Arizona, Minnesota, Montana and Nebraska, according to the Interior report.

The National Indian Gaming Association, the industry’s lobby and trade association, does not provide independently verifiable statistics on casino employment. Economist Meister puts the figure at 333,717.

Arizona, Oklahoma, Minnesota and Washington each employ 15,000 to 18,000 casino industry workers, according to state tribal gambling associations. Roughly 30 percent of the jobs are held by indigenous employees.

California is the country’s most lucrative Indian gambling industry with 62 casinos generating about $8 billion annually. The industry employs 40,700 workers, more than 90 percent of whom are non-Indians.

California statewide enrollment is not believed to exceed 34,000, meaning a fourth of the gambling revenues nationwide benefit a small percentage of the native population.

Oklahoma has130 facilities but most are small operations such as travel plazas. The state generated $4.2 billion in 2015, according to Meister, placing it second to California.

NIGC does not break down figures by states, to keep revenue figures secret.

Many tribal officials warn the lack of full disclosure can create problems for Indian Country, particularly in the face of a critical Congress, White House, Interior Department and federal courts.

“Without data, you cannot disprove the myth,” attorney Gabe Galanda, a member of the Round Valley Indian Tribes of California, says of the perception tribes are wealthy from casinos.

“That’s an important narrative. Time will tell what this administration and Congress are up to when it comes to Indian policy. With the move toward austerity, we’re going to see a hard look at Indian Country when it comes to those that have and those that don’t.

“There’s going to be some mode of means testing deployed by this administration. They might say, ‘Oh, the oil and gas tribes are OK. The gaming tribes are OK. They don’t need the money.’

“The data becomes pretty important in that conversation.”

 

Casino Impacts Differ Between Tribes

IGRA was not a jobs program for Indians. Nor was it intended to erase poverty in Indian Country.

IGRA was a congressional response to the 1987 U.S. Supreme Court decision in California v. Cabazon Band of Mission Indians, in which justices recognized the sovereign right of tribes to operate gambling on Indian trust lands without interference from state and local governments.

IGRA provided a regulatory framework for tribal casinos, giving state and local governments a voice in the process of establishing Las Vegas-style casinos on existing and newly acquired Indian lands.

Three decades later, there are casinos on all but about 80 of the 326 reservations and rancherias in the lower 28 states. About 30 federally recognized tribes do not have trust lands. There are bingo halls in two of 220 Alaska Native villages.

Gambling revenues under IGRA are used to subsidize government services such as housing, health clinics, schools and reservation infrastructure. Hundreds of millions of dollars are doled out in state revenue sharing, charities and non-Indian communities.

Finally, 130 tribes have revenue allocation plans (RAPs) approved by the Department of the Interior under which tribal members receive casino income. Payments vary depending on enrollment and revenues. Tribes do not disclose how much is paid out.

RAPs to several tribes—Shakopee, the Pechanga and San Manuel Indian bands in California and others—have generated much perhaps misleading press coverage.

“What’s going on at Pechanga and Shakopee is the exception rather than the rule,” Treuer says.

Urban Perspective on Gaming

“Some tribes see casino gaming as a jobs-creation strategy for their members,” says Kate Spilde, associate professor at San Diego State University and chair of the Sycuan Institute on Tribal Gaming.

Employment is not an issue for small tribes in California and elsewhere with fewer than 50 to a few hundred citizens, operating lucrative urban casinos and cashing five-figure monthly per-capita checks.

Some become private entrepreneurs. Others work for their tribal governments.

“Tribes are governments first and foremost,” Spilde says. “People do things that support the government that don’t count as a job.”

Jobs are crucial for large Indian communities where per-capita payments are not an issue. Casinos do little to remedy poverty, joblessness and despair. But, little is better than nothing.

A marginal casino that generates jobs, wages and benefits—and perhaps serves as a community center—is kept open whereas a commercial operation would be shut down.

“It’s not about finances, but job creation,” Desiderio says. “Some facilities exist to break even and create jobs for the community. In other places it’s much easier for the facility to become the financial driver for the tribal government.

Dismal employment figures improved with gambling on the Leech Lake, White Earth and Red Lake nations in northern Minnesota. Tribes are major employers in 16 nearby economically deprived counties.

“Each of those tribes—even the poorest—now has a governmental budget that eclipses most universities and impact lots of people, native and non-native,” Treuer says. “There are bizarre, contradictory dynamics. Casinos cut the unemployment rate by as much as 60 percent in some places, to maybe 20 percent.

“But 20 percent unemployment is still unacceptably high,” Treuer says. “Casinos haven’t eradicated that.”


Michele Landavazo forged a career in gaming before her Navajo Nation approved gaming on its reservation, and how she’s back home working for the Navajo Nation Gaming Enterprise

Coming Home Again
Gaming brings a young Navajo back to her roots

Before she graduated in 2002 with a hospitality management degree from Northern Arizona University in Flagstaff, Michele Landavazo wrote an essay about her dream of working for a casino on her native Navajo Nation.

But it wasn’t until 2008 that the Navajo Nation Gaming Enterprise (NNGE) opened Fire Rock Casino near Gallup, New Mexico, the first of what are now four casinos on the sprawling, three-state reservation that is home to some 200,000 indigenous Americans.

“I wanted to be close to my family,” says the young wife and mother who returned to Navajo as an experienced dealer and supervisor. She previously worked with Caesars Entertainment in Lake Tahoe, Nevada, and tribal casinos in Phoenix, Arizona.

Getting Landavazo back home is exactly what Navajo had in mind when it opened Fire Rock, two other casinos in Church Rock and Fruitland, New Mexico, and the flagship Twin Arrows resort on Interstate 40 between Flagstaff and Winslow, Arizona.

“The No. 1 priority was to create jobs and economic opportunity for Navajo,” NNGE Chairman Quincy Natay says. “The big benefit has been enabling Navajos to come back and work at home.”

Unemployment in the various Navajo Nation chapters ranges from 40 percent to 60 percent.

“It’s good for our Navajo people to get a paycheck, go shopping and buy cars,” Navajo President Russell Begaye told a recent tribal conference in Scottsdale, Arizona. “It gives them a tremendous sense of pride that they can raise their families.”

The enterprise has created about 1,250 jobs, 85 percent of which have gone to tribal citizens. NNGE pays out about $122.5 million a year in salaries and benefits.

As is the case with most large and rural Indian nations, gambling alone is not intended to completely remedy unemployment and a weak economy. But it helps. The same is true for the Pine Ridge and Rosebud Lakota nations and other impoverished reservations.

“It hasn’t been the complete solution. But it has made a major impact,” Natay says. “We are one of the top five employers on Navajo.”

As is the case with many government casinos, NNGE’s goal isn’t entirely to make a profit.

Twin Arrows is struggling to pay down $220 million it borrowed from the nation to build the resort. Natay says the enterprise so far has generated $94 million in interest, $12.5 million in principal and $8 million toward a gambling distribution fund.

NNGE hopes to work closely with other tribal enterprises, using gambling as the economic engine to develop motels, restaurants and retail businesses, generating a ripple of non-gambling jobs. Glittering Mountain is being developed as a 70-acre shopping center and residential development adjacent to Twin Arrows.

Federal law allows tribal governments to engage in hiring preference for indigenous citizens and other Native Americans. Studies show in most states about 30 percent of tribal casino employees are American Indian.

The percentage of native workers is much higher among larger tribes in more rural northern Minnesota. About 90 percent of the 40,700 workers in California tribal casinos are non-Indian, primarily because most indigenous communities have small enrollments.

Minnesota tribal casinos have 15,287 workers, making the industry the state’s 14th largest employer.

Employment was the goal in the early 1990s, when Grand Casinos Inc. Managing Partner Lyle Berman worked with the Mille Lacs Band of Ojibwe in developing hotel resorts in Hinckley and Mille Lacs, Minnesota.

“Berman had somebody high on the organization chart whose sole responsibility was to get tribal people trained to run the operation,” says a tribal official who requested anonymity. “It worked.

“If there was a tribal member who wanted a job and could pass the regulatory background investigation, they worked for us. Most of the managers also were native.”

If there is a barrier to tribal employment, it’s the fact many Native Americans are victims of generational poverty and lack skills and a work ethic.

“Having access to a job doesn’t necessarily cure those things that are keeping people from their own self-determination,” Karen Diver, former chairwoman of the Fond du Lac Band of Lake Superior Chippewa, told MinnPost.com.

“When you have multiple generations in one family who have suffered hardship and all of the resulting social ills that come from poverty and oppression, it is really going to take more than one generation to make them better.”

Extensive training was necessary for many newly hired Navajos, a job that fell to experienced people such as Landavazo, who taught table games.

“There were a lot of people in hotel and food service jobs,” she says. “But most of the Navajo applicants and management were brand new to the casino industry. They were highly motivated.”

“I saw pride on their faces that I’ve never seen before,” a Navajo executive says of recent hires at the casino, many of whom are expected to quickly move up the ranks.

“If you put those people in those roles, and allow them to grow, they’re going to grow.”

Landavazo learned firsthand the importance of giving Navajos the resources to provide for their families.

“I was able to help provide for my siblings and other families in need,” she says. “It helped stabilize the community.”

Author: Dave Palermo

Dave Palermo is an award-winning metropolitan newspaper reporter. He has written about American Indian governments for more than 20 years, working as an advocate for several tribes and tribal associations. He also has co-authored books on gambling and gambling law. He can be reached at dgpalermo1@gmail.com.