December 1999	Legislative Guide to INDIAN GAMING REGULATORY ACT
	Published by the Iowa General Assembly -- Legislative Service Bureau

III. State Regulation of Indian Gaming Under the IGRA

IV. Summary

Introduction.
This Legislative Guide addresses several issues involved in state regulation of Indian gaming pursuant to the federal Indian Gaming Regulatory Act (IGRA), including the basis for the IGRA, states' attempts to regulate or prohibit Indian gaming under, or in spite of, the IGRA, and court cases interpreting the IGRA. References to the United States Code are to Supplement III of Title 25 of the United States Code as amended to January 26, 1998.
The Indian Gaming Regulatory Act.
1. Overview of Relevant Provisions.
     Congressional Findings. Indian gaming is carried out under the federal Indian Gaming Regulatory Act.¹ Section 2701 sets out congressional findings regarding the need for the IGRA, particularly the need for clear standards and regulations for the conduct of gaming on Indian lands and the promotion of tribal economic development, tribal self-sufficiency, and strong tribal government. Section 2701(5) provides tribes with "the exclusive right to regulate gaming activity on Indian lands if the gaming activity is not specifically prohibited by federal law and is conducted within a state which does not, as a matter of criminal law and public policy, prohibit such gaming activity."
     Section 2702 contains the congressional declaration of policy underlying the IGRA. The policy of the IGRA is to provide for tribal economic development, self-sufficiency, and strong tribal government, provide a statutory basis for the regulation of Indian gaming by an Indian tribe, and to declare that the establishment of an independent federal regulatory authority, federal standards, and the National Indian Gaming Commission are necessary to meet congressional concerns regarding gaming and to protect gaming as a means of generating tribal revenue.
     Types of Gaming. The IGRA also defines, in section 2703, the types of games subject to the Act. Class I games are social games with minimal prizes or traditional forms of Indian gaming. Class II games are the following: bingo and related games and card games which are explicitly authorized by the state or are not explicitly prohibited by the state and are played in conformity with those laws and regulations of the state regarding hours or periods of operation or limitations on wagers or pot sizes. Class II games do not include banking card games such as blackjack or electronic games of chance or slot machines. Class III gaming is everything else, including banking card games such as blackjack and slot machines and table games such as roulette and craps.²
     Class I games are under the exclusive jurisdiction of the Indian tribes and are not subject to the regulatory provisions of the IGRA.³ Class II gaming is only subject to tribal jurisdiction, but may be regulated in accordance with section 2710(b) as follows:
  (1) An Indian tribe may engage in, or license and regulate, class II gaming on Indian lands within such tribe's jurisdiction, if--
  (A) such Indian gaming is located within a State that permits such gaming for any purpose by any person, organization or entity (and such gaming is not otherwise specifically prohibited on Indian lands by Federal law), and
  (B) the governing body of the Indian tribe adopts an ordinance or resolution [concerning the conduct or regulation of class II gaming.]
  
     Section 2710(d) sets out the requirements for Class III gaming, in relevant part, as follows:
  (1) Class III gaming activities shall be lawful on Indian lands only if such activities are--(A) authorized by an ordinance or resolution of the governing body of the Indian tribe.
  (B) located in a State that permits such gaming for any purpose by any person, organization, or entity, and
  (C) conducted in conformance with a Tribal-State compact entered into by the Indian tribe and the State under paragraph (3) that is in effect. . .
  (3)(A) Any Indian tribe having jurisdiction over the Indian lands upon which a Class III gaming activity is being conducted, or is to be conducted, shall request the State in which such lands are located to enter into negotiations for the purpose of entering into a Tribal-State compact governing the conduct of gaming activities. Upon receiving such a request, the State shall negotiate with the Indian tribe in good faith to enter into such a compact.
  
     General Requirements. The compact may contain any subjects directly related to the operation of gaming activities. The IGRA does not confer upon a state or a political subdivision of the state the authority to impose taxes, fees, charges, or other assessments upon tribes which seek to operate Class III gaming and it prohibits a state from refusing to negotiate "based upon the lack of authority in such state, or its political subdivisions, to impose such a tax, fee, charge, or other assessment."⁴ A tribe may agree, however, to pay assessments to a state or a political subdivision to defray the costs of state regulation of its Class III gaming activities and may agree to a payment in lieu of taxes to the state in "amounts comparable to amounts assessed by the State for comparable activities."⁵
     Lawsuit Jurisdiction. Section 2710(d)(7)(A) places jurisdiction in the United States District Court over any lawsuit brought by a tribe arising from the failure of the state to enter into negotiations for a tribal-state compact. Failure to negotiate in good faith could result in an order against the state to conclude a compact within 60 days.⁶ However, this jurisdiction was ruled invalid in 1996 by the United States Supreme Court due to the state's immunity under the 11th Amendment.⁷
     If the state continues to refuse to enter into a compact, a mediator will be appointed to decide between the best offer submitted by the tribe and the state. Failure of the state to consent to the mediator's choice allows the mediator to submit the proposed compact to the Secretary of the Interior for implementation of Class III gaming in accordance with the mediator selected-compact provisions as prescribed by the Secretary of the Interior.⁸
2. Basis for IGRA.
     The IGRA was enacted in response to several lawsuits by Indian tribes seeking to operate gaming activities on tribal lands in the face of opposition by states. One such lawsuit involved the Cabazon Band of Mission Indians, who sought to operate gambling activities on their land in California. The State of California sought to apply a provision of its penal code limiting the conditions under which the tribe conducted its bingo and draw poker games.⁹
     The United States Supreme Court, after reviewing the history of state jurisdiction over Indian activities, determined that the state's civil jurisdiction over Indian activities was limited, while its criminal jurisdiction was not.¹⁰ In light of the limitation on the state's civil jurisdiction, the Court looked to see whether the state prohibited gambling activities of the type the Indians operated or only regulated them. The shorthand test developed by the Court to determine whether a state's approach is criminal/prohibitive rather than civil/regulatory is whether the gaming at issue violates the public policy of the state.¹¹
     The Court analyzed California's gambling laws and concluded, based on the fact that the state allowed a substantial amount of gambling, promoted gambling through a state lottery, and permitted bingo by charitable organizations, that gambling in general was not against the public policy of California, and that bingo in particular, was regulated, not prohibited.¹²
     This civil/regulatory versus criminal/prohibitive distinction was adopted by Congress and is apparent in the language of the congressional findings in section 2701(5) and the regulatory provisions of section 2710(b)(1)(A) and (d)(1)(B).¹³
3. Indian Gaming in Iowa.
  The State of Iowa has compacts with the three Indian tribes who are federally recognized and own gambling facilities in this state. The compacts have similar provisions specifying the responsibilities of the tribes, the federal government, and the State of Iowa regarding the operation of the Class III gambling games. The Sac and Fox Tribe of the Mississippi in Iowa operates a casino on the Mesquaki Settlement near Tama, the Winnebago Tribe of Nebraska operates a casino near Onawa, and the Omaha Tribe of Nebraska operates a casino near Council Bluffs.
  Class III Gaming. Each of the tribal casinos offers a range of Class III gambling opportunities as follows:
  1. Dice games including craps, chuck-a-luck, and lotto dice.
  2. Wheel games including roulette, money wheel, horse race wheel, and big six.
  3. Pari-mutuel wagering on horse and dog races using the computerized totalizer system of the simulcasting track.
  4. Card games including poker, twenty-one, monte, spanish monte, pan, super pan nine, in-between, and baccarat.
  5. Lotteries and keno.
  6. Sports betting including parlay cards.
  7. Sport betting pool.
  8. Slot machines, progressive slot machines, and video games of chance.
     Regulatory Authority. The compacts require each tribe to establish a gaming regulatory authority or commission to supervise the operation of Class III gambling games pursuant to an ordinance adopted by the tribal council. The regulatory authority or commission is responsible for proposing the regulations governing the conduct of all authorized Class III games, investigating any alleged violations and recommending remedial actions to correct any violation, and establishing and enforcing all occupational and other licensing requirements. The tribes may retain management contractors to conduct the gaming operations. All contractors, employees, or agents of the contractors must be licensed after a thorough background investigation by the Federal Bureau of Investigation, Division of Criminal Investigation, or other appropriate investigative agency selected by the tribal council. The tribes must also inspect, test, and approve all gambling devices pursuant to minimum standards required by the compact.
      Law Enforcement. The compacts also address the exercise of criminal and civil law with regard tothe Class III gambling operations on Indian land. Except for the criminal prosecution of persons who are not tribal citizens, the three tribes exercise complete civil and criminal jurisdiction over players of authorized gambling games, licensees, and all other persons or entities whose acts or omissions relate to gambling games or property on their respective tribal lands. Except for the criminal prosecution of tribal citizens, the State of Iowa is responsible for civil and criminal jurisdiction over all players, all licensees, and all other persons or entities whose acts or omissions relate to Class III gambling activities on Indian lands, for all property related to Class III gaming activities on Indian lands for the purpose of monitoring, auditing, or investigating violations of the compact, regulations, and the gaming ordinance.
     Taxation. There is no tax imposed by the compacts on any Class III gambling activity. However, the tribes agree to collect any Iowa retail sales or use tax which the State of Iowa may lawfully impose on transactions made to persons who are not tribal citizens, to withhold Iowa income taxes for all persons employed by the tribal casino, and to withhold Iowa income taxes imposed on gambling winnings of all persons who are not tribal citizens.
     Fees. Two of the three compacts provide for a monitoring fee. Those compacts require the Winnebago and Omaha Tribes to pay an annual fee of $30,000, commencing not later than October 30, 1999, to the Department of Inspections and Appeals to reimburse the Department for the costs of monitoring the Indian gaming according to the standards established by the Department. In addition, for the Omaha Tribe, the fee is increased annually by 5 percent and, for the Winnebago Tribe, the fee is increased annually by a percentage equal to the percentage change in the Consumer Price Index (CPI) as reported for the preceding year. The Winnebago and Omaha Compacts have provisions expressing the intent of the Department of Inspections and Appeals to include monitoring fees in compacts with all other tribes operating Class III gaming facilities. The Department will likely request the renegotiation of the Sac and Fox Compact which does not include a monitoring fee, when negotiations can be reopened near the expiration of the compact in June 2003.
     Compact Period. The compacts are effective for an initial term of eight years and are automatically renewed for successive eight-year terms unless either party gives notice in writing of its intent to renegotiate the compact at least six months, but not more than one year, before the expiration of the current term. However, the Winnebago Compact provides for at least 12 months, but not more than 18 months, notice of intent to renegotiate before the expiration of the current term. The Sac and Fox Compact was negotiated in 1995 and the Winnebago and Omaha Tribes Compacts were negotiated in 1998.¹⁴
State Regulation of Indian Gaming Under the IGRA.
1. The Compacting Process and the Good Faith Requirement.
     The exclusive procedure for a state to obtain jurisdiction over Class III Indian gaming is for the Indians to allow state jurisdiction through the compacting process of section 2710(d)(3)(A). In the absence of a compact regarding Class III gaming, no extension of state jurisdiction or application of state laws to Indian gaming is permitted.¹⁵
     Section 2710(d)(3)(A) states that upon receiving a request by a tribe to enter into negotiations for a Class III gaming compact, the state "shall negotiate with the Indian tribe in good faith to enter into such a compact." This good faith requirement and the issue of whether the state permits Class III games have been the source of much disagreement between states and tribes.
     State Refusal to Negotiate. Several states have attempted to prevent Class III gaming by refusing to enter into compact negotiations or by refusing to negotiate on certain games. These actions have led to lawsuits by tribes to force compact negotiations. In 1998, the California tribes initiated legislation (Proposition 5) to authorize gambling on Indian reservations. The proposition was approved by a 63 percent majority of the voters, but the California Supreme Court ruled in 1999 that the proposition violated the California Constitution, which prohibits Las Vegas-style casino gambling. The California tribes are initiating a constitutional amendment for the 2000 general election to accomplish the legalization of Class III gaming on Indian reservations.¹⁶
     Regulation Versus Prohibition. The State of Wisconsin claimed it did not have to include Class III casino games in compact negotiations with one of the tribes because Wisconsin did not allow casino games.¹⁷ The issue turned on the interpretation of section 2710(d)(1)(B), which authorizes Class III games on Indian lands only if the Indian tribe is "located in a state that permits such gaming for any purpose by any person, organization, or entity (emphasis in original). . . ." The State claimed casino games were not permitted under any circumstances in Wisconsin since the State has never expressly authorized the playing of casino games.¹⁸ The court disagreed, noting that under the IGRA the court must look at the distinction between the state's civil and criminal laws to determine whether the State permits the casino gaming activities desired by the tribe. "If the [state's] policy is to prohibit all forms of gambling by anyone . . . the state's criminal laws apply to tribal gaming activities . . . [I]f the state allows some forms of gambling, even subject to extensive regulation . . . it is barred from enforcing its gambling laws on the reservation."¹⁹
     In determining whether a state "permits" gaming as the term is used in the IGRA it is not necessary that the state have expressly approved a particular game, only that the state's public policy toward gaming be regulatory rather than prohibitive. The court also noted that the legislative history of the IGRA indicated that Congress intended the term "permits such gaming" not to limit tribes to the specific types of gaming activity actually in operation in a state.²⁰
     In Connecticut, the Mashantucket Pequot Tribe sought to expand its gaming activities to include Class III casino games of the type allowed in Connecticut for certain nonprofit organizations during "Las Vegas nights." The State refused to negotiate a compact involving Class III gaming, claiming that the limited authorization of "Las Vegas nights" with wager, prize, and other restrictions did not amount to a general allowance of casino games and that unlimited casino gaming of the type desired by the tribe was contrary to the public policy of the State.²¹ The tribe brought suit under the IGRA to compel the State to negotiate a compact. The court held that the limited authorization of casino games by Connecticut was sufficient to allow the tribe to conduct high stakes casino games and to require the State to negotiate and implement a compact in light of the rest of Connecticut's gaming laws, which the court found to be regulatory rather than prohibitory.²²
     State Law Changes. The IGRA does not, according to one federal district court, prevent a state from changing its gaming law after negotiations on a compact are requested. The State of Idaho changed its gaming law after the Coeur D'Alene Tribe had requested the State to negotiate a gaming compact. The State adopted criminal and constitutional prohibitions against all forms of Class III gaming except limited pari-mutuel betting and a State-run lottery.²³ The court found that changing the State's law and public policy regarding gaming did not deprive the tribe of any vested rights and that the court would look to current state law to determine if a particular gaming activity was allowed rather than the law in effect at the time of the request for negotiations.²⁴
     The tribe also argued that because the State allowed a form of Class III gaming, namely pari-mutuel betting, the State should be required to negotiate regarding all forms of Class III gaming which the tribe wanted to operate. The court disagreed, finding that the term "gaming activities" used in section 2710(d) means specific games. Simply permitting a limited number of Class III activities does not open all Class III activities to negotiation.²⁵
2. Constitutional Issues and the Compacting Process.
  1. The 11th Amendment.
    Several states have attempted to avoid the requirement in the IGRA to negotiate compacts with Indian tribes on the basis that the requirement violates the states' sovereign immunity under the 11th Amendment to the United States Constitution. The 11th Amendment states that "[t]he Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State."
    The 11th Amendment has been interpreted by the courts to bar all suits in federal court against a state except in three situations: (1) consent by the state; (2) congressional abrogation of the immunity; and (3) if the suit is against a state official in an official capacity for prospective injunctive relief.²⁶
    1. Lower Federal Cases Prior to the Seminole Tribe Decision by the United States Supreme Court. Court reaction to a state's attempt to assert the 11th Amendment have been mixed. Some courts, including a federal District Court in Alabama, sided with the states; others, including a federal District Court in Florida and a panel of the 8th Circuit Court of Appeals, found that no 11th Amendment immunity existed; and a District Court in Washington adopted a hybrid position on this issue.
         Alabama -- State Sovereignty Upheld. In two decisions in the lawsuit between the Poarch Band of Creek Indians and the State of Alabama, in which the tribe sought to compel the negotiation of a gaming compact with the State, the court first found that the State had not consented to be sued by the tribe since the IGRA did not give the Secretary of the Interior the authority to sue the State at the point in the compacting process that the tribe sued the State and therefore, the State was not yet subject to a situation in which its consent to suit was required.²⁷ The court also found that Congress had no constitutional authority under the Indian Commerce Clause of the U.S. Constitution²⁸ to abrogate Alabama's 11th Amendment immunity.²⁹
         In the second decision in the Poarch litigation, the court found that the 11th Amendment also prevented it from compelling the Governor of Alabama to negotiate a compact. The court based its decision on its finding that the act of negotiation is a discretionary function and that the suit was actually against the State even though the Governor was named individually.³⁰
         Washington -- Mixed Decision. The lawsuit under the IGRA by the Spokane Tribe of Indians against the State of Washington provided the United States District Court for the Eastern District of Washington with the opportunity to find that Congress lacked the constitutional authority to abrogate a state's 11th Amendment sovereign immunity to suits from Indian tribes through the IGRA.³¹
         The Spokane court did not completely adopt the reasoning of the Poarch courts, however. The Spokane court held that individual state officers were subject to suit on the basis of violating the good faith negotiation requirements of the IGRA.³² The court noted that failing to allow suit against individual state officers, even though the result might interfere with discretionary executive authority, will deprive the Indians of any forum in which to present their case.³³
         Florida -- United States District Court Rules State Sovereignty Subject to Federal Law. Faced with a lawsuit by the Seminole Tribe to compel the State of Florida to enter into compact negotiations, the State asserted that it was immune from suit under the IGRA under the 11th Amendment.³⁴ Rejecting the analysis used in Poarch I, the federal District Court found that Congress did have the constitutional power to abrogate a state's 11th Amendment immunity and held that Congress had abrogated a state's immunity when it enacted the IGRA.³⁵ The court determined that the plenary authority Congress has over Indian affairs provides Congress with sufficient power to abrogate a state's 11th Amendment immunity.³⁶
         Iowa's Federal Circuit. The reasoning of the Seminole district court was adopted by a panel of the 8th Circuit Court of Appeals, the circuit in which Iowa is located, in a lawsuit brought by the Cheyenne River Sioux Tribe to settle the issue of whether its gaming activities were subject to the limitations imposed by South Dakota law on non-Indian gaming activities.³⁷ The Court of Appeals also stated that South Dakota waived its 11th Amendment immunity by entering into compact negotiations and seeking to benefit from the negotiations through agreements regarding State supervision of Indian gaming.³⁸
         Florida District Court Case Revised by Circuit Court. The decision of the District Court in Seminole Tribe was reversed on appeal by the Court of Appeals for the 11th Circuit, which found that Florida did not lose its 11th Amendment immunity from suit under the IGRA.³⁹ This disagreement between the various federal courts set the stage for the United States Supreme Court to enter the Indian gaming arena to settle the 11th Amendment issue. This it did in its decision on appeal by the Seminole Tribe following the decision by the 11th Circuit Court of Appeals.⁴⁰
    2. The Florida Seminole Tribe Decision by the United States Supreme Court. The United States Supreme Court affirmed the finding of the 11th Circuit Court of Appeals that a state was not subject to suit under the provisions of the IGRA because none of the criteria had been met for finding that 11th Amendment immunity had been waived.⁴¹
         The only issue before the Court was whether Florida could assert a claim of immunity from suit under the 11th Amendment. The Court first inquired as to whether the IGRA was passed pursuant to a constitutional provision granting Congress the power to abrogate the state's 11th Amendment immunity. The Court found only two previous situations where congressional authority to abrogate the states' 11th Amendment immunity had been upheld by the Court. The first situation involved the 14th Amendment, which extended federal power to enforce civil rights over the states.⁴² Abrogation of the states' 11th Amendment immunity was found within the language of the amendment providing Congress with powers of enforcement.⁴³
         The second situation involved that portion of Article I, section 8, clause 3, of the United States Constitution known as the Interstate Commerce Clause.⁴⁴ In its decision in Pennsylvania v. Union Gas Co., the U.S. Supreme Court had held that the Interstate Commerce Clause granted Congress the power to abrogate state sovereign immunity because the power to regulate interstate commerce would be incomplete without the authority to render states liable for damages.⁴⁵
         The Seminole Tribe sought to apply the Union Gas rationale to suits under the IGRA, enacted pursuant to congressional authority under the Indian Commerce Clause, also contained in Article I, section 8, clause 3. This provision vests sole authority with the Congress to regulate commerce with Indian tribes. The Court disagreed and overruled the Union Gas decision:
      In overruling Union Gas today, we reconfirm that the background principle of state sovereign immunity embodied in the Eleventh Amendment is not so ephemeral as to dissipate when the subject of the suit is an area, like the regulation of Indian commerce, that is under the exclusive control of the Federal Government. Even when the Constitution vests in Congress complete lawmaking authority over a particular area, the Eleventh Amendment prevents congressional authorization of suits by private parties against unconsenting States. The Eleventh Amendment restricts the judicial power under Article III, and Article I cannot be used to circumvent the constitutional limitations placed upon federal jurisdiction. Petitioner's suit against the State of Florida must be dismissed for lack of jurisdiction.⁴⁶
      
         The Court then examined whether the tribe could maintain suit against the Governor of Florida in his official capacity, notwithstanding the 11th Amendment bar. The Court noted there is an alternate method for a tribe to obtain approval to conduct gaming contained in section 2710(d)(7) of the IGRA. A tribe which cannot reach an agreement with a state may go to the Secretary of the Interior and obtain authorization to conduct gaming activities. The Court found that "where Congress has prescribed a detailed remedial scheme for the enforcement against a State of a statutorily created right, a court should hesitate before casting aside those limitations and permitting an action against a state officer . . . .^"47 Although holding that the Court should not lift the 11th Amendment immunity of the Governor, the Court did not find that Congress was without the power to authorize a suit against a state officer in the face of the 11th Amendment, only that Congress had not in fact done so under the IGRA.⁴⁸
  2. The 10th Amendment.
    Although the need to utilize a 10th Amendment argument is questionable following the Seminole Tribe case, several states have claimed that the IGRA violates the 10th Amendment to the U.S. Constitution because it forces the states to negotiate with any tribe which makes a request for compact negotiations.⁴⁹ Although this issue was not presented to the Supreme Court in the Seminole Tribe case, the 8th Circuit Court of Appeals rejected South Dakota's claim that the IGRA violated the 10th Amendment, finding that the IGRA only provides the opportunity for a state to enter compact negotiations; it does not compel a state to do so.⁵⁰
3. Indian Gaming on Newly Acquired Lands.
  A related issue concerning Indian gaming is whether a tribe may acquire land and open a gaming operation. Section 2719 of the IGRA controls this issue.
  Generally, gaming is not authorized under the IGRA on Indian lands acquired after October 17, 1988, unless the land acquired is within or contiguous to existing Indian land or to former land of the tribe if the tribe no longer has a reservation. These requirements may be waived by the Secretary of the Interior if the Secretary finds that a gaming establishment on newly acquired lands would be in the best interest of the Indian tribe and its members and would not be detrimental to the surrounding community under certain circumstances, and if the governor of the state in which the gaming activity is to be conducted agrees with the Secretary's findings.⁵¹ Gaming activities may also be conducted on land newly acquired as a result of a land claim settlement, acknowledged as the tribe's initial reservation, or restored to federal recognition.⁵² At least one commentator has indicated that these requirements make it "quite difficult for a tribe to purchase land and establish a gaming operation without first receiving the approval of the state's governor."⁵³
Summary.
   The decision of the United States Supreme Court in the Seminole Tribe case that the commerce clause does not provide Congress with the authority to abrogate the states' 11th Amendment immunity and, therefore, that Congress could not provide a federal court forum for suits by tribes against unconsenting states under the IGRA, closes the courthouse door to tribes seeking to force compact negotiations on unconsenting states. It is not clear, however, what the net effect of the case will have on Indian gaming or on other federal legislation which seeks to provide a federal court forum for persons aggrieved by state action. Given the mechanism found in section 2710 of the IGRA allowing a tribe to obtain permission to conduct gaming activities from the Secretary of the Interior in the event a state refuses to negotiate a compact, states may successfully avoid negotiating on Class III gaming compacts and find Class III gaming within their borders anyway under the permission of the Secretary of the Interior.⁵⁴
   The manner in which the Secretary of the Interior handles tribal requests to operate gaming establishments in the face of state opposition may be the deciding factor in whether further congressional action is taken. However, since current Iowa law and public policy allow a wide range of gaming activities outside of the Indian casinos, it is questionable how much impact a congressional change in the IGRA would have on Indian gaming in Iowa.
   Iowa Approach. In Iowa, the three compacts between Iowa and the tribes provide that request for renegotiation of a compact is subject to the IGRA as if it were an initial request for negotiation of a compact which must be undertaken in good faith. As long as Iowa permits, for any reason, non-Indian gaming which is equivalent to Class III Indian gaming, it is likely that the State would not be successful in asserting its 11th Amendment immunity in a suit by a tribe to compel the State to renegotiate a compact in good faith. First, Iowa has a pattern and practice of waiving any immunity by its negotiation and renegotiation of compacts with the tribes. Second, without a change in state law and public policy to prohibit all Class III-type gaming, the State could point to no change in circumstances to justify its failure to renegotiate, barring some sort of criminal or other problem with the Indian gaming exemption. Although the Coeur D'Alene Tribe decision does support a state's prerogative to change its gaming law after a request for compact negotiations is made by a tribe, that decision arose in a state with no history of allowing Class III Indian gaming and therefore is probably not dispositive of a case involving the State of Iowa were such a change in Iowa law to occur.
   Also, each Iowa compact is automatically renewed at the end of its effective period, unless either party to the compact seeks to renegotiate it. This means that some change in circumstances will probably have to occur before either the tribes or the State feels a significant need to renegotiate. In order to be able to try to negotiate an end to Indian gaming in the state, the State would have to prohibit all Class III gaming as a matter of law and public policy, including non-Indian casino gaming and charitable casino-type games. Given the existence of the alternative procedure under the current IGRA for tribes to obtain permission to conduct gaming activities, so long as the State allows non-Indian gaming which would be Class III gaming if conducted by an Indian tribe, the Secretary of the Interior could permit Indian gaming as well.
   The Seminole Tribe decision did not close the federal courthouse door on all lawsuits between tribes and states. Iowa could consent to a federal suit for a number of reasons, including to obtain a judicial determination of whether state law has been changed to prohibit gaming as a matter of state criminal law and public policy, or to interpret a disputed portion of a compact.
   Currently, none of the compacts between the tribes and the State of Iowa provide for any payment in lieu of taxes. Two of the three tribes will pay an annual fee of $30,000 for oversight costs commencing in October 1999, and it is expected that the third tribe will be asked for similar fees for oversight costs when its compact is subject to renegotiation in 2002. Currently no other public proposal has been put forward by either the tribes or the State to negotiate any other payment to the State from the tribes.⁵⁵

ENDNOTES

¹25 U.S.C. §§2701-2721.

²Banking card games are those in which the players play against the house, and where the house has a financial stake in the game. Nonbanking card games are those in which the players play against each other. National Conference of State Legislatures, State Legislative Report, Vol. 17, No. 16, p. 4 July, 1992.

³IGRA, §2710(a)(1).

⁴IGRA, §2710(d)(4).

⁵IGRA, §2710(d)(3)(C)(iii-iv).

⁶IGRA, §2710(d)(7)(B)(iii).

⁷Seminole Tribe of Florida v. State of Florida, 517 U.S. 1133 (1996).

⁸IGRA, §2710(d)(7)(B)(iv-vii).

⁹California v. Cabazon Band of Mission Indians, 480 U.S. 202, 205 (1987).

¹⁰Id. at 207-208.

¹¹Id. at 209.

¹²Id. at 211.

¹³U.S. v. Sisseton-Wahpeton Sioux Tribe, 897 F.2d 358, 366 (8th Cir. 1990).

¹⁴Sac and Fox Tribe of the Mississippi in Iowa/State of Iowa Gaming Compact (1995); Winnebago Tribe of Nebraska/State of Iowa Gaming Compact (1998); and Omaha Tribe of Nebraska/State of Iowa Gaming Compact (1998). For a description of non-Indian gaming activities in Iowa, see Legislative Guide to Gambling in Iowa by Thane R. Johnson, Legislative Service Bureau.

¹⁵U.S. v. Sisseton-Wahpeton Sioux Tribe at 365.

¹⁶William Booth, "California Tribes Dealt Out of the Game," Washington Post, August 24, 1999, at A2.

¹⁷Lac du Flambeau Indians v. State of Wisconsin, 770 F.Supp. 480, 482-83 (W.D. Wis. 1991).

¹⁸Id. at 484-85.

¹⁹Id. at 485.

²⁰Id. at 486-87.

²¹Mashantucket Pequot Tribe v. State of Connecticut, 913 F.2d 1024, 1026-29 (2nd Cir. 1990), cert. denied, 499 U.S. 975 (1991).

²²Id. at 1030-32.

²³Coeur D'Alene Tribe v. State, 842 F.Supp. 1268, 1269-70 (D. Idaho 1994).

²⁴Id. at 1276.

²⁵Id. at 1280.

²⁶Poarch Band of Creek Indians v. State of Alabama, 776 F.Supp. 550, 553 (S.D. Ala. 1991) (Poarch I).

²⁷Id. at 555.

²⁸U.S. Const., Art. I, §8, cl. 3.

²⁹Poarch I at 556.

³⁰Poarch Band of Creek Indians v. State of Alabama, 784 F.Supp. 1549, 1551-52 (S.D. Ala. 1992) (Poarch II).

³¹Spokane Tribe of Indians v. State of Washington, 790 F.Supp. 1057, 1061 (E.D. Wash. 1991).

³²Id. at 1062.

³³Id. at 1063.

³⁴Seminole Tribe of Florida v. State of Florida, 801 F.Supp. 655-56 (S.D. Fla. 1992).

³⁵Id. at 657-58.

³⁶Id. at 660.

³⁷Cheyenne River Sioux Tribe v. State of South Dakota, 3 F.3d 273, 280-81 (8th Cir. 1993).

³⁸Id. at 280-81.

³⁹Seminole Tribe v. Florida, 11 F.3d 1016.

⁴⁰Seminole Tribe of Florida v. Florida, 517 U.S. 1133 (1996).

⁴¹Id. at 1132.

⁴²The 14th Amendment reads in relevant part: "No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deprive any person within its jurisdiction the equal protection of the laws. . . The Congress shall have power to enforce, by appropriate legislation, the provisions of this article."

⁴³Pennsylvania v. Union Gas Co., 491 U.S. 1, 19-20 (1989).

⁴⁴U.S. Const. Art. I, §8, cl. 3, which reads in relevant part: "The Congress shall have Power . . . To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;".

⁴⁵Pennsylvania v. Union Gas Co. at 1, 19-20.

⁴⁶Id. at 276-77 (internal footnote omitted).

⁴⁷Id. at 278.

⁴⁸Id. at 278, n. 17.

⁴⁹The 10th Amendment reads as follows: "The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people."

⁵⁰Cheyenne River Sioux Tribe v. State of South Dakota at 281.

⁵¹IGRA, §2719(b)(1)(A).

⁵²IGRA, §2719(b)(1)(B).

⁵³Kading, State Authority to Regulate Gaming Within Indian Lands: The Effect of the Indian Gaming Regulatory Act, 41 Drake L. Rev. 317, 335 (1992).

⁵⁴Seminole Tribe of Florida v. Florida, 517 U.S. 1132-33 (1996).

⁵⁵Non-Indian gaming establishments do pay taxes on their annual gross receipts. See Iowa Code §99F.11.

Comments about this site or page? lsbinfo@legis.state.ia.us

Please remember that the person listed above does not vote on bills. Direct all comments concerning legislation to State Legislators.

Last update: WED Feb 2 2000
sw/sam

CONTENTS

ENDNOTES