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NIGC oversight hearing

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WASHINGTON - Leaders of the National Indian Gaming Commission and the National Indian Gaming Association testified May 14 before the chairman of the Senate Indian Affairs Committee, Ben Nighthorse Campbell.

Phil Hogen, head of the NIGC, explained how the commission will use its $12 million in tribal fees. He then pled the case to give the NIGC more legal power in regulating Class III casino operations.

Ernest Stevens and Mark Van Norman, chairman and executive director, respectively, of NIGA, spoke against broadening NIGC's hold over Class III gaming, saying that the combined tribal and state regulatory systems work fine already. NIGA also expressed its displeasure about the last minute, behind closed doors change to the fiscal year 2004 budget. The appropriations committee axed Congress's $2 million dollar ante for the NIGC, while putting the commission's 50 percent funding increase solely on the backs of the gaming tribes, without consulting them.

Both the federal agency and the lobbying entity for Indian gaming agreed on one thing: IGRA should be amended to allow tribes to triumph over recalcitrant states that refuse to negotiate Class III compacts where such forms of gambling (slot machines, blackjack card games) already occur. The U.S Supreme Court's 1996 Seminole Tribe v. Florida decision declared that a state's sovereign immunity would prevent a tribe from filing a lawsuit over the state's failure to grant a compact.

Criminal attractions

The NIGC wants authority from Congress to license developers, gaming equipment manufacturers, and other non-management contractors with which Class III gaming tribes enter into business deals. The commission says its problem is that once it finds criminal violations, such as theft, the NIGC has no authority to directly deal with the situation by, for example, imposing fines or ordering restitution of funds. The NIGC can only turn the matter over to law enforcement, and notify the tribal government. But many times the tribe and/or the law enforcement agency may not be interested in pursuing the matter.

The NIGC bases its argument for greater control over casino gaming on the fact that the commission was created by Congress because of concerns about organized crime taking over Indian gaming.

As a second example of NIGC's bark not having any bite, it points to the increasing number of Indian casinos that are illegally running a Class III operation without a compact. NIGC blames this situation on the Seminole decision, which allows states to ignore IGRA's requirement to compact with tribes in situations where such gaming already is permitted. This gray area gaming, NIGC says, attracts shady individuals who would never get licensed in Las Vegas or Atlantic City.

The solution is to amend IGRA to allow the NIGC to license the outside vendors.

Mind your own business

NIGA's view is that the regulatory system 'ain't broke.' Tribes share that responsibility with the states, but not with the NIGC. Stevens protests that the NIGC's licensing proposal would grind activity in tribal gaming operations to a halt, given how slow the commission already is when it comes to reviewing management contracts.

NIGA says tribes spend $164 million each year on their own regulations. Van Norman told Senator Campbell, "We need to leverage the tribal resources so that we're not duplicating efforts at the NIGC level."

NIGA says tribes already conduct investigation and background checks on their employees and contractors. As an example, Van Norman described electronic fingerprint technology used at the southern California Viejas tribe's casino. Prospective employees brush their fingers across a computer screen, creating a digital image that is immediately sent to the National Indian Gaming Commission. NIGC forwards it to the FBI, which can provide any criminal history within 24 hours.

TIME and TIME again

NIGC's testimony says TIME magazine last December incorrectly reported that the commission had not uncovered even a single case of corruption. NIGC says they find lots of corruption, it's just that their hands are tied as far as doing anything about it.

Senator Campbell asked NIGA's Stevens what he thought about the two-part article. Campbell said the bad press has driven some of his colleagues' concerns about Indian gaming.

Stevens replied, "We don't want to sit before you in response to this type of publication. We respond that the issues centered around TIME magazine were mixed truths, half reporting without getting the whole story."

Tangential NIGC

After the hearing, Van Norman and Stevens reflected on the issues presented. Van Norman compared the NIGC's plan to license tribal business partners in the same category as last year's idea to get involved in regulating Indian casino health and safety.

"What's happened in the past is sometimes the Commission has gone off on a tangent," Van Norman says. "Tribes already have plans to deal with the environment, public health and safety."

Stevens said the point he tried to make at the hearing was to get them to understand how serious gaming tribes are about developing their own regulatory schemes.

"There's no need to duplicate, especially when there is a budget crunch."