The National Indian Gaming Commission won't be making
drastic changes to the Class II industry after hearing
complaints from tribes, the agency's chairman said
Last year, the agency proposed new definitions and standards in hopes of
drawing a greater distinction between Class II machines
like bingo and Class II slot machines. But tribes
nationwide said the rules would wreck their $23 billion
So rather than proceed with the changes, NIGC Chairman Phil
Hogen said his agency will start all over again.
Another set of drafts are to be made public soon, although
no timeline has been set.
"We remain committed to bringing consideration of these important issues to an early
conclusion but as it is likely that our finished product would depart in several
areas from that published in the Federal Register in 2006, we are withdrawing
those earlier proposals," Hogen said.
This week, a notice in the Federal Register
will announce the withdrawal
of the definitions and classification standards that
were initially published on May 25, 2006. The technical standards
that were published on August 11, 2006, are also being withdrawn.
"We have received an impressive amount of productive and thoughtful comment on
these critically important issues," Hogan added.
"The commission has listened and carefully considered this input, concluding that it
must take another look at the form and substance of the proposed regulations."
At hearings throughout Indian Country, tribes said the proposed changes
would force them to remove certain electronic machines from their
Some said they would lose revenues and have to layoff employees and even
close some of their gaming facilities.
"We estimate an 80 percent loss of revenue at our facility in Atmore, and the
potential loss of 500 jobs at our facilities in Montgomery should the rules go
into effect," said Buford Roiin, the chairman of the Poarch Band of
Creek Indians of Alabama, a tribe that depends entirely on Class II gaming.
"Clearly, some of our facilities will be forced to close."
Backing the tribal complaints was an economic study commissioned
by the NIGC.
The Analysis Group concluded that the rules would
have a "significant negative impact" on the tribes that
operate Class II gaming.
The $23 billion tribal casino industry started off with Class II games
like bingo and pull tabs. After the passage of the Indian Gaming
Regulatory Act in 1988, tribes began to sign compacts with states
to allow more lucrative Class III games like slot machines, blackjack
But tribes in certain states rely heavily on Class II gaming because
Class III gaming is illegal or the governor refuses to negotiate a
Even in states with compacts, however, tribes use Class II
games to supplement their Class III offerings, particularly
since several states place limits on the number of
Class III games that tribes can operate.
Economic Analysis Report
Classification Analysis Report
National Indian Gaming Commission - http://www.nigc.gov
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