By Benjamin Truman, Co-Founder and COO of MediaTroopers
Alongside operators licensed at the state level, tribal authorities are a vital component of the gambling industry, with over 675,000 jobs supported by tribes in the gaming industry generating revenues of $27.8 billion in 2020.
This money supports tribal government programs and initiatives, supports local businesses, and provides diverse career opportunities in federally recognized tribes.
Growth of Tribal Gaming
Tribal gaming grew up in the 1970s, with small bingo halls popping up nationwide. Since then, the industry has grown, with tribes opening massive events centers around the country.
With 250 tribes operating 515 tribal casinos and other gaming locations, these facilities are a huge part of their respective states’ entertainment, gambling, and hospitality industries.
Currently, tribal authorities operate through gaming compacts with their respective states. These compacts are signed subject to the approval of the Department of the Interior through the legal framework provided by the Indian Gaming Regulatory Act (IGRA).
This current procedure has been tested with the arrival of digital gaming, as legislation was written well before cell phones brought sportsbooks to nearly every American’s pocket.
Tribal Gaming Regulations
The regulations surrounding Indian betting have struggled to keep up with technological advancement, as shown by the legal dispute between two Florida pari-mutuels, the Department of the Interior, and the Seminole Tribe of Florida, who operate Hard Rock Sportsbook.
The Bureau of Indian Affairs (BIA) has, therefore, made new proposals on gaming compacts that could be revolutionary for tribal casinos.
The regulations would, in effect, provide the biggest shakeup of online gambling in the US since overturning the Professional and Amateur Sports Protection Act of 1992 (PASPA).
The overturning of PASPA made the legalization of sports betting and iGaming into a states’ rights issue. The BIA’s regulations would make sports betting and iGaming on tribal lands a tribal rights issue, streamlining the market and clarifying tribes’ ability to offer statewide mobile gaming, among other things.
New Tribal Gaming Compact
Three significant changes have been proposed:
- Tribes could offer digital sports gaming and online gambling statewide if the games are included within the tribal-state compact.
- States with Class III gambling would have to negotiate each Class III game with tribes. This could potentially include digital gaming.
- Tribes would be permitted to purchase new lands, subject to an official process to make them available to gamble on under IGRA.
Other changes proposed include:
- Adding and defining “gaming spaces” to current regulations, which differs from previously described “gaming facilities.”
- Protecting tribes from states demanding taxes, fees, charges, or other assessments for offering wagers.
- Clarifying the difference between compacts and amendments and creating a process for submitting agreements to the DOI secretary.
- Allowing tribes to submit compacts electronically in addition to hard-copy submissions.
- Clarifying whether the DOI secretary must actively disapprove a compact for it to fail or whether it is “deemed approved” if it is consistent with IGRA.
Advocates claim the changes would fix many of the problems that have appeared since the overturning of PASPA. It could undoubtedly resolve the current Seminole litigation, which would be a relief to bettors in Florida who want sports betting on their cell phones.
The current DOI secretary, Deb Haaland, did not sign off on the compact that allowed the Seminole Tribe to offer digital sports betting in Florida. Instead, she let the 45-day waiting period for action pass. The Seminoles launched regardless but were forced to pull down the app after multiple lawsuits were filed against it.
Public comment on the regulations has just ended, and among the casino associations offering their views was the Seminole Tribe, who submitted 12 pages of comments supporting the changes. They wrote that “compact provisions allocated jurisdiction are permissible under IGRA when the parties are allocating jurisdiction over activities relating to gaming activities on Indian lands.”
The Indian Gaming Regulatory Act
The debate has recently centered on whether IGRA exists to protect tribal sovereignty or confine Indian gaming to tribal lands only. This is the center of the litigation in the Seminole Tribe case.
IGRA was passed in 1988, and gambling has changed to an unbelievable degree. Many states’ gambling markets are now dominated by mobile betting, something not envisioned when the act was initially passed. It is more suited to regulating in-person gaming on tribal land rather than mobile wagering through tribal casinos.
The BIA consulted with tribal authorities while drafting the proposed changes and found that some favored including provisions on mobile gaming, while some were less interested. One in particular states that provisions were not “ripe for inclusion.”
The Federal Register summarized that the “overwhelming majority of commenters agreed that the Department should include provisions relating to iGaming,” and “state law model of iGaming is not a substitute for IGRA and tribes should be able to engage in internet gaming under it.”
Tribal Gaming – Summary
Fundamentally, the new regulations would give the Seminole Tribe the control over mobile sports betting it wanted and allow it to launch its popular app to Florida bettors. I always believe that legal and secure sports betting is always preferable to the alternatives, including unregulated offshore sportsbooks. Allowing intelligent and effective regulation is always preferred.
Clarifying regulations around tribal gambling will be a positive step for all involved. It would allow tribal authorities to use the revenue gained from wagering to help tribes continue to provide the vital service they give to Indian nations.
Gambling in the US owes much of its success to federally-recognized tribes, and nearly 680,000 jobs are dependent on tribal authorities, the vast majority of which is generated through gambling. Therefore, intelligent, effective, and modern regulations must be drawn up to provide a clear pathway to improve the relationship between states, tribes, and the gambling industry.