How much Oklahoma? Governor demands a record share of tribal casino revenues
Oklahoma Governor Kevin Stitt, a Republican, expressed his desire to raise the fees charged to tribal casinos in the state demanding a share that would be among the highest in the nation. Tribes say that puts thousands of jobs and casino operations at risk.
The question deserves to be asked, if tribal casinos were Amazon or Microsoft, would they be courted or taxed heavily? The former was offered more than $2 billion in tax incentives from the state of New York when they were deciding whether or not to build their new headquarters there.
Back in 2004 residents of Oklahoma overwhelming passed State Question 712, otherwise known as the State-Tribal Gaming Act, by more than 270,000 votes which established laws for the state to enter into gaming compacts with the federally-recognized tribes.
As part of the compacts, tribes pay an “exclusivity fee” ranging between 4 percent and 10 percent of a casino’s net revenue and in the fiscal year 2018, the state of Oklahoma collected nearly $139 million from such fees. The amount the state received was a record for the fourth consecutive year.
Since the acts inception, tribes of Oklahoma have paid more than $1.5 billion in exclusivity fees and that money has been distributed between the Education Reform Revolving Fund, the General Revenue Fund and the Department of Mental Health and Substance Abuse Services.
In addition to those fees, the Oklahoma Indian Gaming Association reports that tribal gaming contributes $7.2 billion to the state economy, and gaming employees paid out almost $325 million in payroll-related taxes, including $33 million in income taxes to the State of Oklahoma.
That's not enough for this governor.
Despite the success over the past 15 years, tribal leaders and Stitt, a Cherokee citizen, are at odds over what happens next when the original compacts expire at the end of the year.
Tribal leaders say the compacts will renew for another 15-year period whereas Gov. Stitt says the compact will terminate. He wants to renegotiate the compacts and raise the exclusivity fees to a range of 20 percent to 25 percent. Stitt wrote in an op-ed earlier this month that he derived that number to match most other compacts in the country.
But there is little evidence to back up that claim.
Fees do vary from state to state. For example, Arizona exclusivity fees range between 1 percent and 8 percent and in Minnesota, which could be considered one of the most successful tribal gaming states, the exclusivity fee is nonexistent, or zero.
In his op-ed, Stitt called Oklahoma's fees "the lowest in the nation."
At a meeting earlier this month, the Inter-Tribal Council of the Five Civilized Tribes approved a resolution and released a statement rejecting the governor’s plan.
“We have considered the state of Oklahoma a trustworthy partner through the years,” the statement said. “The recent action of Governor Stitt puts into question his sincerity to work with us in a cooperative manner moving ahead. We are resolute in our position, and it is our hope Governor Stitt and his advisors will not attempt any bad faith interference on the compact which could set back the progress we have achieved by working together.”
The Oklahoman newspaper wrote: "The unity among the Five Tribes show they could be a force to be reckoned should the impending expiration of the gaming compacts pit the tribes against the state. Leaders of the Five Tribes represent more than 750,000 Native American people."
However in response to the passed resolution, Stitt released a statement of his own saying he was elected to give a “fresh eye to all agreements.”
“I am committed to open discussions with all tribal partners and to achieving an outcome that spurs more funding for public education, grows opportunity for the tribes, and is a successful partnership for the state and future generations of Oklahomans,” Stitt said.
Beyond the taxes, fees and additional tourism Oklahoma tribal casinos bring to the state, they also invest in infrastructure, education, health care and employ more than 55,000 people. In an American Gaming Association report, Casinos & Communities, Senior Vice President of Economic Development of the Tulsa Regional Chamber, Brien Thorstenberg said tribal gaming has improved everyone’s lives.
“I think that the overall quality of life and standards of living of tribal citizens have improved, and the gaming industry has invested a lot back into the state of Oklahoma, which has improved everybody’s lives,” Thorstenberg said.
As the gaming industry continues to grow and Oklahoma continues to rake in hundreds of millions of dollars in exclusivity fees, critics ask, why fix what’s not broken?
Kolby KickingWoman is a reporter/producer for Indian Country Today. He is Blackfeet/Gros Ventre from the great state of Montana and currently reports and lives in Washington, D.C. Follow him on Twitter - @KDKW_406. Email - firstname.lastname@example.org