WASHINGTON – National Indian Gaming Commission Chairman Phil Hogen has rejected requests from tribal representatives to have technical advisers participate in the process of reviewing proposed gaming machine regulations and to post the representatives’ letters and contact information on the commission’s Web site.
The tribal representatives are members of MTAC – the Minimum Internal Control Standards Tribal Advisory Committee – were selected by their tribal leaders and empanelled by NIGC a year ago to review proposed changes to MICS in Class II and Class III gaming machines.
In an Aug. 21 letter to committee members, Hogen responded to concerns tribal representatives expressed in a story published in Indian Country Today [Vol. 29 No. 11]. The representatives asked to have technical advisers sitting at the table during meetings to answer questions and explain the more technical aspects of the proposed revisions, but Hogen rejected the request.
“We have to be mindful that this is a government-to-government process. The advisory committee members have been specifically designated as official governmental representatives by their respective tribal governments. To allow parties other than designated governmental representatives with the authority to speak on behalf of their tribes puts the NIGC at risk of running afoul of the Federal Advisory Committee Act,” Hogen wrote.
Richard Chissoe, Osage Tribe’s gaming commissioner and an MTAC member, told ICT the selection of technical advisers should be at the members’ discretion, and he doubted their presence would put NIGC at risk of violating FACA.
“If the NIGC does in fact view this committee and our participation as a government-to-government consultation process, and our government leadership has allowed us to speak on behalf of our Indian tribes, why would that authorization not be applicable to any technical adviser that we would choose?” Chissoe said.
Hogen said the tribes were free to have their technical advisers write to NIGC’s IT specialist and gaming systems engineer with questions and comments.
Chissoe said MTAC members haven’t met the NIGC’s technical advisers and have had no direct contact with them or knowledge of their expertise.
MTAC members said in an Aug. 24 letter to Hogen, “it was clear that neither the committee members nor the NIGC staff could explain the meaning of certain proposed technical language, the intent of the standard or even what the rule is meant to address.”
“We got into this very protracted dialogue, perhaps it means this, perhaps it’s referring to this,” Chissoe said about a recent MTAC-NIGC meeting in Alabama. “And at some point, the committee had to say, look, we don’t think it’s proper for NIGC to be proposing regulations that the NIGC itself cannot explain.”
He said it would be particularly problematic for him as a gaming regulator to be responsible for enforcing regulations that no one has been able to explain.
“And on the point of submitting questions in writing and having them answer in writing, that’s not true dialogue and it is not true consultation. What if the answer is something the committee members don’t understand or it prompts further questions? I think to propose that it would be adequate as some sort of meaningful consultation process is just asinine.”
Tribal representatives were also concerned that a proposed regulation requiring jackpot payouts to be validated by a backroom accounting system is really a technical standard masquerading as a MICS. They said the regulation, if passed, would force gaming operations to purchase expensive new equipment from a particular manufacturer or to pay the manufacturer a royalty fee to use its proprietary technology.
Hogen, refuting that claim, said “no technical specifications” are being proposed.
“The contemplated MICS in no way impose a mandate for tribes to invest in specific technology, with the possible exception of necessary ticket validation equipment. The MICS are simply meant to establish control standard for certain technology if it is in use at a tribe’s gaming operation,” Hogen wrote.
Not quite, Chissoe said.
“I would characterize it this way; it’s like saying we’re not saying you have to buy a Chevrolet, but if you don’t buy a Chevrolet you’re going to have a hard time operating in compliance.”
A concern expressed by tribal representatives is that the proposed jackpot payout regulation would favor only a few manufacturers’ systems, and if federal regulations imply a virtual monopoly by those few manufacturers, how will costs be affected?
“It doesn’t take a lot of imagination to predict the cost of those systems would increase dramatically and they’re already very expensive, up to tens of millions of dollars for some of these systems,” Chissoe said.
Hogen also rejected the committee’s request to post all of their letters and related documents and their contact information on the NIGC Web site. He said NIGC already posts draft regulations and other documents. He suggested the committee set up its own Web site.
Chissoe said the request was based on the committee’s desire for transparency about its role in the process.
“There’s been concern that the work of the committee could somehow be misrepresented. That’s something all members of the committee would not like to see happen. We’d like to have some sort of assurance that all parts of this process that we’ve agreed on and parts that we’ve expressed concern about would be communicated out there.”
Chissoe also wants to assure skeptics of the committee’s good faith efforts.
“There have been some comments that the MTAC may be viewed somehow as a co-conspirator in some NIGC agenda and I really want to disagree with that. I think for this committee to not participate would not help anyone; for one thing it would allow NIGC to finalize regulations with no chance of revision by the industry. I think it’s important that we engage in this process, embrace this process in the hope of developing more workable regulations for our industry.”
The next MTAC-NIGC meeting will be held Oct. 6 – 8 at the Santa Ana Star Casinos in Albuquerque, N.M.
Interview with NIGC Chairman Phil Hogen, Sept. 2, 2009