Monteau: Montana governor wrong on IGRA

Tuesday, December 5, 2006  

Posted at request of Harold Monteau, Chippewa Cree.

I read the articles in the Missoulian and other Montana papers regarding the Class III Tribal State Gaming Compact negotiations between the Confederated Salish and Kootenai Tribes (CSKT) and the Governor. Some of the legal positions that the governor takes, on the advice of the Attorney General I presume, are way out of sync with the Indian Gaming Regulatory Act (IGRA) that Congress passed in 1988 and the case law that has developed in the Federal Courts since.

The IGRA applies to “Indian Country” and explicitly includes all lands within the boundary of any Indian Reservation irregardless of whether it is in trust or in fee, owned by non-Indians, the state, the tribe or tribal members. The IGRA does not “give” jurisdiction over gaming within the boundary of the reservation to the tribe. The IGRA recognizes that tribes already have that jurisdiction to the exclusion of the state. The IGRA allows for a state to “assume” jurisdiction over gaming within a reservation if the tribe consents in a Class III Tribal State Compact. If the tribe does not consent it keeps the jurisdiction. The state has no authority unless the tribe gives it to the state.

The tribes can continue to have Class II Gaming even in the absence of a Class III Tribal State Compact. The tribes can also allow taverns, bars, restaurants and convenience stores on the reservation to have Class II machine gaming as long as the tribes own the games and receives an adequate percentage of the revenue. The State licensees who will have to shut down their poker and keno machines this week can ask the tribe to place tribally owned Class II devices in their establishments. These tribally owned devices would be part of the nationwide system the Class II devices are hooked into and that allow for prizes into the millions of dollars. As long as the tribes own the devices and not the establishment, they would be legal under the IGRA. A The tavern, restaurant, liquor store and convenience store owners would have to seek a Class II license from the tribe and the Tribal Gaming Ordinance would have to provide for such licenses. There is nothing in the IGRA that prevents this.

The taverns, bars, restaurants and convenience stores can also ask the tribes to place Class III games in their establishments or to grant them a license to conduct Class III gaming as long as a reasonable percentage goes back to the tribes and the Tribal Gaming Ordinance permits it. The IGRA permits tribal licensing of non-tribally owned Class III gaming as long as the Tribal Gaming Ordinance permits it and there is a Class III Tribal State Compact in place. If the Tribal State Compact allows for all Class III devices within the reservation to have unlimited numbers, bets and prizes, then the non-Indian owners could have them as long as the tribe gets a reasonable percentage of the revenue.

Montana’s Class III Tribal State Gaming Compacts are out of sync with the other Tribal State Compacts around the country and are out of sync with the IGRA and the case law decided under the IGRA. In no other state, except South Dakota, are the compacts so restrictive. Even there the tribes don’t have to put up with the draconian limitations forced on the Montana Tribes by a succession of Republican Governors. For those with short memories, a little history; Several Montana Tribes sued Governor Racicot and the state under the “bad faith” provisions of the IGRA back in the late 1980’s and early 1990’s. The State of Montana hid behind its sovereign immunity and the cases were dismissed after the U.S. Supreme Court ruled in Seminole V. Florida that when Congress passed the IGRA it did not waive the States’ sovereign immunity and it remained intact unless the state waived it.

Several states, in an effort to resolve Class III Tribal State Compact negotiations deadlock, did waive their immunity and allowed Federal Courts to hear and decide the issues. This practice led to Compacts in almost every other state (not counting Hawaii and Utah where there is no state authorized gaming) except Montana and Oklahoma. Oklahoma passed a “Legislative Compact” that if the tribes accept; they can endorse and send up to the Secretary of Interior for approval. Montana now has the distinction of having the worst Tribal State Gaming Compact in the nation.

There is really no reason for this issue to destroy tribal state relations in Montana, which it will if it is not resolved. The “State” has several choices as does the Governor as he is the Chief Executive of the State. They are:

• Continue to maintain the present position and tear tribal-state relations apart.
• Propose, along with the tribes a Class III Tribal State Legislative Compact which if passed simply requires tribal endorsement and the Interior Secretary’s approval. The Compact could leave the regulation, licensing and taxation of Class III devices to the tribes and would benefit not only the tribes and Indian owned businesses but also the non-Indian businesses that engage in gaming. Everybody wins.
• Agree, as many states have, to waive the state’s sovereign immunity and allow a Federal Court to decide the issues and appeal if the state does not like the result. The worst that can happen is the Court will order mediation and the mediator will ultimately ask each side for their last best offer and make a recommendation one way or the other. If the state does not accept the mediator’s decision, the tribe can petition the Secretary of Interior for “Alternative Compacting Procedures”.
• The state can wait until the Tribes sue (which they will, since they have no choice) the state under the remedies in the IGRA. The state can then raise the state’s sovereign immunity (per se bad faith) as a defense, in which case the tribes will petition the Secretary of Interior for “Alternative Compacting Procedures” which is the other remedy available in the IGRA when tribes and states can’t agree and the state raises its sovereign immunity as a defense. The Solicitor for the Department of Interior will then look at Montana Law to see what Class III gaming is allowed for any entity or person and will determine that Montana has Class III gaming with unlimited bets and prizes (lottery machines which use the same technology as a slot machine); that Montana allows individuals and corporations to have an unlimited number of Class III Gaming devices (Poker and Keno which also operate on the same technology as a slot machine) depending upon how many wine, beer, liquor, restaurant and convenience store alcoholic beverage licenses the individual or corporation has it can have a compliment of twenty machines with each license. The Solicitor may very well determine that the state does allow slot machine gaming in the form of lottery, poker and keno devices. Some corporations in Montana operate in excess of 1,500 Class III devices. There are some 19,500 plus Class III machines operating in Montana under such licenses. The tribes do not operate 1,500 Class III devices in total.
• The state can also wait until the tribes (or their trustee the United States Department of Justice) file a civil rights action based on the fact that the above described gaming is allowed for others in the state but not tribes and they are singled out for discriminatory treatment based on national origin and race. Such treatment does not comport with Montana’s Constitution nor the United States Constitution. The damages will be the lost revenue from 1988 to present and lost economic opportunity in the form of thousands of jobs and hundreds of millions of dollars the tribes have been cheated out of because of the states blatant discriminatory treatment of the tribes.

Economic discrimination in the form of economic racism is economic terrorism. No legal or moral argument can be made to sustain this reprehensible treatment of Montana’s Native Americans. If Montana continues in its position, that it does not allow unlimited numbers of gaming devices (slot machines) to individuals and that it does not allow device gaming with unlimited wagers and prizes (lottery), the Secretary of the Interior has a trust responsibility to take the state out of the equation and issue to the Montana Tribes “Alternative Compacting Procedures” that comport with the IGRA and its case law.

The opinions expressed herein are the author’s well informed analysis of the law in this area and the state, tribes and individual interested parties should seek their own well informed Federal Indian Law Legal Counsel experienced in matters arising under the IGRA. The author does not represent any party in the present controversy.

Harold A. Monteau, is a partner in the majority Indian owned Law Firm of Monteau & Peebles, LLP, a firm engaged in the practice of Federal Indian Law with offices in Missoula, Omaha, Sacramento, Washington, D.C. and Sioux Falls. He is also the former Chairman of the National Indian Gaming Commission during the Clinton Administration. He can be reached through the firm website http://www.ndnlaw.com.