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Sharing the wealth: Tribes in California and Ontario take the lead

Since the advent of casino-style Indian gaming in the United States via 1988's Indian Gaming Regulatory Act, many tribes have, without a doubt, secured for themselves a much brighter economic outlook and financial future. Of course, not all tribes have chosen to participate in gaming for a variety of reasons, which include moral and cultural concerns, and remote market locations. Thus gaming wealth has certainly not made its way into all corners of Indian country.

California's gaming tribes have devised a means to circulate gaming profits through a unique revenue sharing plan in its tribal-state gaming compact. This plan, which puts money in the pockets of non-gaming tribes, is the only one of its kind in the U.S.

"The tribes actually brought this concept forward with Proposition Five," said Susan Jensen, spokeswoman for the California Nations Indian Gaming Association, referring to the 2000 referendum that established Indian gaming in the state. "California tribes realized that there were a lot of tribes located in places that will most likely never be able to have a casino and benefit from gaming dollars. In addition, it was the tribes that put in provisions for sharing revenue with the local governments as well."

In September 1999, 58 tribes signed a statewide gaming compact with Democratic Governor Gray Davis (three more have since signed on, bringing the total to 61). Under its provisions, tribes with 350 or more slot machines in their casinos pay, each quarter, a licensing fee on each machine above the 350 limit. The fees are put in a pot and distributed quarterly, in equal shares, to the state's 78 federally recognized tribes that either have no casinos or that operate fewer than 350 slots. The maximum amount a tribe can receive is $1.1 million per year.

"The thought was that a tribe operating 349 slots or less is not really making a lot of money; the main purpose of such a casino is to provide jobs for tribal people and members of the local community," Jensen told Indian Country Today in a recent interview.

So even though a tribe may have a relatively small gaming operation, it "should still be able to participate in the non-gaming tribes' revenue-sharing trust fund in order to help provide [funding and] services for their governments," Jensen continued. "Instead of having tribes who have very small operations shut down in order to get the money, let them continue, let them keep providing some jobs and still benefit."

According to the Sept. 15 edition of the Sacramento Bee, California's 78 non-gaming (but federally recognized) tribes will each receive a check for $188,000 this month. Since the state began disbursing the funds in 2000, the non-gaming tribes have received some $710,000 from their gaming cousins.

While certainly not the windfall that gaming itself can produce for a tribe, these funds are often desperately needed by their recipients. Unlike grants and other forms of federal and state assistance that tribes may receive, the revenue-sharing funds come with no strings attached; the money can be used for whatever each tribe wants.

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"The theory is working very well," said Jensen. "There are some kinks that the tribes are working out ? trying to make sure that the payments are made promptly and accurately to the non-gaming tribes. But so far [the non-gaming tribes] have received over $700,000 each."

The Bee noted what it called "flaws" in the program; one is that funds are not allocated on a per capita basis, meaning that tribes of all sizes get the same amount of cash. Another is that the "vague language" of the 1999 compacts resulted in a dispute over whether one-time slot licensing fees were to be included in the revenue-sharing fund or not. Eventually, the state Gambling Control Commission decided to credit these "prepayment" fees toward the gaming tribes' required quarterly payments, which meant "$37 million less for the poorer tribes," the Bee said.

Another, albeit radically different, casino revenue-sharing plan exists in the Canadian province of Ontario. The province's single native-owned casino, Casino Rama, is owned by the Mnjikaning First Nation and operated by Wyomissing, Penn.-based Penn National Gaming Inc. Casino Rama, located north of Toronto near Lake Simcoe, opened in 1996 and is the "largest single-site employer of Aboriginal people in Canada," according to its web site.

Revenues from this casino are shared with approximately 130 First Nation communities throughout Ontario; 35 percent of the casino's net revenue goes to the Mnjikaming nation, while the other 65 percent is allocated to the province's other tribal groups.

Under this program, casino allocation funds are to be used for tribal projects promoting community development, health, education, economic development and cultural development. Yet it seems that while revenue sharing has great potential to assist native peoples, a single casino does little to accommodate the financial needs of Ontario's First Nations. The Ontario allocation program has a five-year life span, which is apparently due to expire soon if it has not already done so. Officials in Ontario did not return phone calls by press time.

Generosity is a trait long associated with and characteristic of Indian culture. The so-called Pilgrims might not have survived had it not been for the generosity of the Wampanoags in 1620. A group of Oneidas walked from Central New York to Valley Forge, Pennsylvania, bringing food to Gen. George Washington's beleaguered Continental Army during the brutal winter of 1777-78. The Chinooks aided Lewis and Clark's exhausted Corps of Discovery when it reached the mouth of the Columbia River in 1805-06. This list could certainly go on and on.

In negotiating future compacts, both the tribes and the states might be wise to consider including similar stipulations mandating that tribes not participating in gaming, for whatever reason, can at least derive some of the benefits from gaming monies. Such stipulations could allay fears among the less fortunate of being by-passed on a proven path leading to eventual economic self-determination and would certainly make them less reliant on the federal government for aid.

While the California and Ontario models may not be perfect, they do offer guidelines and perhaps "lessons learned" as to what does and does not work in revenue-sharing plans. In any case, the gaming tribes of California and the Mnjikanings of Ontario are to be commended for sharing their gaming revenues with their less fortunate, non-gaming counterparts.