Tag: Indian Gaming

Alabama: Indian Gaming Benefits More Than Just Tribes

While political opposition still sometimes flares up, with some form of legal gaming available in all but two states, there now is little question that gaming is widely accepted in the United States. In 2014, commercial casino gaming revenues were slightly less than $38 billion, and tribal gaming represented an additional $28.5 billion. These are significant economic contributors, and tribal gaming is especially important in helping improve conditions in many communities.

Tribal gaming is a unique economic engine. The Indian Gaming Regulatory Act (IGRA), which was enacted in 1988 to provide a statutory basis for the regulation of gaming on Indian lands, prohibits using net revenues from Indian gaming for any purpose other than funding tribal government operations or programs; providing for general welfare of the tribe and its members; promoting tribal economic development; donating to charitable organizations; or helping fund local government agencies’ operations. The dedication of tribal gaming revenues to these beneficial purposes has funneled hundreds of millions of dollars into health and welfare programs, education, housing and public safety, assisting not only tribal members, but the surrounding communities.

The Poarch Creek Indians (PCI) in Alabama illustrate this point. Since achieving federal recognition in 1984, they have grown their gaming economic development operations from a small bingo hall with 130 jobs to three major casinos and a growing number of non-gaming enterprises with a combined total of nearly 4,000 employees, most of whom are not enrolled tribal members.  The casinos are “destinations,” with first class restaurants, spas and entertainment venues, including recreation for the local communities such as movie theaters, arcades and bowling alleys. In keeping with the IGRA rules, their revenues fund health clinics, elderly housing, scholarships, and even a 15,000 acre wildlife preserve. They funded the construction and on-going full-time staffing of two fire and rescue stations that serve the entire community and have joint assistance agreements between their tribal police and two sheriff’s departments to help with local law enforcement.

PCI has generously fulfilled the IGRA provision that allows “helping fund local government agencies’ operations,” with substantial donations to schools, transportation, hospitals, public safety operations and other local government functions. They make charitable gifts to a broad range of agencies and have an endowment program to which anyone can apply for up to $5,000 to fund a community service program.

Perhaps even more remarkable is the Creek Indian Enterprises Development Authority through which PCI is expanding their business operations into a diversified group of enterprises bringing economic development to the entire state, and especially good jobs to areas where, not so long ago, share cropping was still prevalent. PCI operates a major interstate truck stop, convenience stores, hotels and restaurants not connected to gaming, one of the largest cattle farming operations in Alabama and a high-tech manufacturing facility serving the aircraft and automobile industries and supplying parts for space vehicles. As an indicator of the Tribe’s sound economic development strategy, in 2015, these business enterprises were self-sustaining, with no supplemental funding from the gamng operations.

The drafters of the IGRA legislation intended it to be a vehicle to provide the ability for Indians to benefit their communities and help tribal members escape wide-spread poverty. The PCI economic development focus is a demonstration of the wisdom of that policy.

Article By Larry C. Lavender of Jones Walker LLP

© 2016 Jones Walker LLP

The Texas Legislature Takes a “Texas Two Step” Approach to Indian Gaming

With new legislation introduced in Texas, it is an appropriate time to examine whether the Texas State Legislature is trying to do something for Indian Gaming or to Indian Gaming. The only certainty is that something is likely to happen! And, like the Texas Two Step, the legislative casino dance changes at the whim of the “leader” – which in this case is the Texas Legislature.

The overriding question is: What is happening here, and why?

For starters, it is important to understand two things: (1) the state’s three federally recognized Indian tribes do not share equal legal status and (2) the Legislature ostensibly has proposed to level the playing field so that all three enjoy an equal gaming opportunity. The three tribes are (1) the Texas Band of Kickapoo Indians in Eagle Pass, which is 143 miles southwest of San Antonio on the Rio Grande River and far from the Gulf Coast, (2) the Ysleta del Sur Pueblo Tribe – also known as the Texas Tigua Tribe, located near El Paso and far from the Gulf Coast, and (3) the Alabama-Coushatta Tribe of Livingston, 74 miles north of Houston and 76 miles northwest of Beaumont, and clearly much closer to the Gulf Coast and the hundreds of thousands of tourists annually traveling to the Gulf. Each of these tribes was recognized by a special Act of Congress.

Kickapoo was recognized by Congress through the Act of January 8, 1983, a federal law which imposed no restrictions on the Tribe’s right to conduct gaming. The Alabama-Coushatta and Texas Tigua Tribes were recognized through the Act of August 18, 1987, which restricted any tribal gaming to gaming activities that are lawful under Texas state law. The distinction between Kickapoo gaming opportunity and that available to the Alabama-Coushatta and Tigua becomes important under both the Texas state laws and, in turn, the federal Indian Gaming Regulatory Act of 1988.

It should be noted that the Alabama-Coushatta opened a casino in 2001 on its Livingston reservation that produced monthly revenues of an estimated $1 million for nine months. A federal court shut it down, and the facility has never reopened. Similarly, the Tigua Tribe operated a casino for a while, but it too was closed by court order. Since then, the Tigua gaming operation has been limited to a “sweepstakes” that the Tribe claims is legal under state law. In the meantime, the Kickapoo Tribe has been operating a Class II gaming facility on its reservation, but the State has refused to negotiate a Class III gaming compact.

The two “have not” tribes are the subject of state legislation that would remedy the situation. This would be accomplished by a bill introduced on March 12 by state representatives for districts in Houston and El Paso purporting to put all three Texas tribes on an equal footing. Indeed, the legislation has been touted in the press as “recognizing the gaming rights of all tribes in Texas.” It would do this by removing the restrictions of the 1987 federal law by extending the same rights to the two tribes recognized by that legislation to the level of rights enjoyed by the Kickapoo under the 1983 federal law. The bill sponsors’ stated intent is to amend the Texas Constitution to allow the Alabama-Coushatta and Tigua to engage in gaming on their tribal lands, and thus putting them on the same footing as the Kickapoo.

Within 24 hours of the introduction of the March 12 legislation, State Representative Joe Deshotel of Beaumont proposed to severely mitigate the pro-tribal benefits from the day-old legislation. The Beaumont politician introduced legislation proposing to authorize nine non-tribal “Las Vegas style” casinos to be located in counties on the Texas Gulf Coast. (As the reader will recognize, the sponsor’s hometown just happens to be in one of the counties that just happens to be on the Gulf Coast.)

The ostensible purpose of the new bill is far from the costs incurred by property owners in those designated counties during violent storms, such as hurricanes. However, its actual effect would be devastating to an Alabama-Coushatta gaming facility located far from the tourism mecca of the Gulf Coast. It is true that the Tigua and Kickapoo would benefit, but they almost certainly would lose destination casino traffic in light of the competing opportunity on the Gulf Coast.

The March 12 legislation looks great on paper. However, it looks much less so in light of the March 13 legislation. Moreover, current activity in the Legislature is even more troubling for tribal gaming. What initially seemed to be a fairly simple resolution is more complicated by recent statements by Texas legislators from Laredo, Houston, and Eagle Pass, as well as statements from anti-gaming lobbyists claiming a “clear majority” of lawmakers opposed to any expansion of gaming “even when times are hard.”

By Dennis J. Whittlesey of Dickinson Wright PLLC

© Copyright 2015 Dickinson Wright PLLC