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Senate committee agrees to refine gaming oversight

WASHINGTON -- The Senate Committee on Indian Affairs accepted some
criticism of its gaming reform bill March 8 with a show of reason, and
rejected some with a show of temper.

By hearing's end, committee chairman Sen. John McCain, R-Ariz., concurred
with Viejas Tribal Gaming Commissioner Norman DesRosiers' observation that
sweeping federal oversight of every "gaming-related contract" would choke
the growth of the industry. DesRosiers said hundreds of contracts at every
tribal casino would fall under the overly broad definition of "gaming
activities" as it now stands in McCain's bill to amend the Indian Gaming
Regulatory Act.

"To have to go to the National Indian Gaming Commission for each of them
would be overly cumbersome," DesRosiers said.

He suggested a focused oversight of contracts that directly involve gaming,
with discretionary provisions that would permit the NIGC to inspect service
contracts for cause. That way, he added, most casino business contracts can
go forward while the NIGC brings its resources to bear on the contracts
that govern actual gaming activities.

McCain called that "good advice," and agreed to narrow the definition of
NIGC-supervised contracts as he moves Senate bill 2078 toward final draft
status: "We certainly don't want to create bottlenecks."

Currently, NIGC Chairman Philip Hogen told the committee, many tribal
gaming "management contracts" -- which must meet criteria set forth in IGRA
as approved by the NIGC -- use terms such as "consulting agreements,"
"development contracts" or "leases" to avoid NIGC review.

Hogen also said that tasking NIGC to review and approve all gaming-related
contracts, broadly defined, "would threaten to stifle the day-to-day
operations of tribal gaming facilities."

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He beseeched the committee to grant NIGC regulatory authority over Class
III gaming -- slot machines, house-banked card and table games such as
blackjack -- where he estimated that 80 percent of tribal casino profits
are to be found. Notwithstanding a court decision that found no authority
under IGRA for the NIGC to oversee Class III gaming, Sen. Byron Dorgan,
D-N.D., the committee's ranking Democrat, said he didn't believe Congress
passed IGRA without intent to regulate 80 percent of Indian gaming
activity. The industry has changed completely since IGRA's passage in 1988,
he said, when Indian gaming amounted to mostly bingo operations. It now
combines bingo and other Class II gaming with Class III activities in an
almost $20 billion industry.

McCain several times addressed the court decision against granting the NIGC
regulatory powers over Class III gaming. If an appeals court doesn't
overturn it, he said, Congress should "fix" the decision with clarifying
legislation: "In my view, we'll probably have to correct it legislatively."

He acknowledged that Congress isn't perfectly certain to pass such a
legislative fix.

In responding to the testimony of Ron His Horse Is Thunder, chairman of the
Standing Rock Sioux Tribe, McCain said he would have no questions: "We're
too far apart on what this committee is trying to do, in my 20 years on
this committee."

His Horse Is Thunder was the soul of discretion in oral testimony, but his
written testimony laced into McCain's bill more or less unsparingly,
contrasting the committee chairman unfavorably with "strong supporters of
Indian rights in Congress then," when IGRA became law.

"Every provision of the McCain bill is punitive with respect to Indian
tribes. There is not one provision in it that is for the benefit of tribes
... Mr. Chairman, the provisions of S. 2078 are an insult to Indian tribes
and are unacceptable." As the price of working with the committee to find
language for the bill that is more consistent with tribal sovereignty and
self-governance, he insisted on a "legislative fix" to another court
decision, known as "Seminole," that prevents tribes from suing states for
not negotiating with tribes in good faith on gaming compacts, as provided
for by IGRA.

McCain has contended at previous hearings, and again at this one, that
amending IGRA will safeguard the Indian gaming industry.