Republican governor suffers another setback in dealings with tribes in Oklahoma

Tuesday, July 28, 2020

By Acee Agoyo

Embattled Oklahoma Governor Kevin Stitt (R) suffered yet another setback to his Indian Country dealings with a federal judge's ruling in favor of tribes whose gaming operations are a primary driver of the state's economy.

In a long-awaited decision on Tuesday, Chief Judge Timothy D. DeGiusti held that tribal nations can continue to operate their casinos under agreements signed more than 15 years ago. Their Class III gaming compacts did not expire, as Stitt had repeatedly contended throughout the high-profile dispute, the ruling stated.

Instead, DeGiusti said the Cherokee Nation, the Chickasaw Nation and the Choctaw Nation were right all along about the lawsuit they filed on December 31, 2019. Their agreements contain an automatic renewal provision that keeps them going for another 15 years, the judge determined.

"No more was required for the compacts to automatically renew on January 1, 2020, for a successive 15-year term," DeGiusti wrote in the 10-page decision.

A rough month for #Oklahoma Gov. Kevin Stitt (R)? He contracted #COVID19, lost a big court case & was cut out of dealings on another. Here's another loss, with judge ruling he is wrong on Class III gaming compacts. @GovStitt @UnitedForOK @okindiangaming https://t.co/vr1pG2sYVO pic.twitter.com/DApJ0Mkud3
— indianz.com (@indianz) July 28, 2020

But the victory wasn't just for the Cherokees, Chickasaws and Choctaws, whose gaming operations account for the bulk of the Indian gaming industry in the state. Six other tribal nations joined the case after it was filed, so the ruling benefits them as well.

And since the Class III gaming compacts for dozens more tribes contain similar automatic renewal provisions, they get to celebrate too. Indeed, Cherokee Chief Chuck Hoskin Jr. called the ruling a win for "all of Oklahoma."

"Tribal gaming in this state will continue to be strong, not only for tribes, but for all of Oklahoma, contributing vital education dollars into our public schools and bolstering health care, roads and communities,” Hoskin said in a statement after noting that the governor spent $1.5 million in legal fees for an outside law firm.

“Everything in our compact now remains the same, and we hope we can move forward and build a relationship built on respect with Gov. Stitt in the future,” Hoskin added, sounding a more promising note.

#CherokeeNation Principal Chief @ChuckHoskin_Jr issued the following statement today on the U.S. District Court for the Western District of Oklahoma ruling that tribal gaming compacts with the state renewed on Jan. 1 for another 15-year term: pic.twitter.com/vysZMQzoNO
— CherokeeNation (@CherokeeNation) July 28, 2020

But if tribal leaders are looking to the state's chief executive to improve his dealings with Indian Country, they will have to wait longer. While Stitt all but said he would not appeal the decision, he made clear that he would continue to try to pressure tribes into negotiating new compacts, as he did at the start of the COVID-19 pandemic.

"Our new gaming compacts show when the state and tribes are at the table together, we can achieve better public policy and healthier relationships," Stitt, who is a citizen of the Cherokee Nation but whose Indian ancestry has been placed in serious doubt, said in a statement after the ruling. "We could create gaming compacts that level the playing field for all Oklahoma job creators and spur hundreds of millions of dollars more in revenue for our public schools."

Early in the pandemic, Stitt was able to negotiate new compacts with the Comanche Nation and the Otoe-Missouria Tribe. The Kialegee Tribal Town and the United Keetoowah Band of Cherokee Indians signed agreements this month.

With few social distancing measures visibly apparent, leaders of the Kialegee Tribal Town signed a Class III gaming compact with Oklahoma Gov. Kevin Stitt (R) on July 2, 2020. Two weeks later, Stitt confirmed he contracted COVID-19, the disease caused by the coronavirus. Photo: Oklahoma Governor

But just last Tuesday, the Oklahoma Supreme Court said Stitt lacked the authority to sign the Comanche and Otoe-Missouria deals. The ruling came in a lawsuit filed by key Republican lawmakers, who broke with the governor on the gaming dispute. So did Republican Attorney General Mike Hunter, who disavowed Stitt's compact negotiations as the state's chief legal official.

The state court decision leaves the Comanche Nation and the Otoe-Missouria Tribe in an unusual but not unprecedented situation. The Trump administration -- whom Stitt goes through great pains to claim as an ally -- allowed their agreements to take effect on June 29, but only to the extent that the provisions are consistent with the Indian Gaming Regulatory Act, a federal law.

A similar situation arose more than a decade ago, when a state court in New York invalidated a gaming agreement signed by the Oneida Nation. But since the Bureau of Indian Affairs had already approved it under IGRA, there was no way to undo it at the federal level.

“The Oklahoma Supreme Court doesn’t have jurisdiction to invalidate our compact when state and federal law dictates that our compact is legal," Chairman John R. Shotton of the Otoe-Missouria Tribe asserted in response to the state ruling.

But since the new compact addressed certain types of gaming that Stitt lacked the authority to approve, Shotton conceded that the tribe cannot offer house-banked card and table games, or sports betting, at this time.

"We will continue to operate under the remaining terms of our compact pursuant to the severability clause of the compact, and we will refrain from operating any game that is not authorized under state law," Shotton said in his July 22 statement.

The Kialegee Tribal Town and the United Keetoowah Band of Cherokee Indians each submitted their updated agreements to Washington on July 1. Under IGRA, the BIA has to take action within 45 days so an answer isn't expected until August 15. Notably, neither tribe presently operates a casino in Oklahoma.

More signs of social distancing were visible when the United Keetoowah Band of Cherokee Indians signed a Class III gaming compact with Oklahoma Gov. Kevin Stitt (R) on July 2, 2020. Two weeks later, Stitt confirmed he contracted COVID-19, the disease caused by the coronavirus. Photo: Oklahoma Governor

Every other Indian nation in Oklahoma has resisted a new compact. The federal court decision confirms they don't have to accept an agreement while being threatened by Stitt, who said he would try and close their casinos if they did not eventually come to the table.

"We appreciate that the court moved quickly to confirm what tribal leaders have always known -- the plain language of our intergovernmental agreements mean what they mean, and here, those words mean our gaming compacts automatically renewed January 1, 2020," said Matthew Morgan, a citizen of the Chickasaw Nation who serves as chairman of the Oklahoma Indian Gaming Association, whose members united against the governor's tactics.

"We look forward to our tribal governments’ continued work under these gaming compacts and our continued contributions to the economic stability and health of our tribal nations and Oklahoma,” Morgan added. "Today’s decision confirms what the tribes have been saying since Governor Stitt first launched his go-it-alone drive to rewrite our compacts."

Chief U.S. District Judge Timothy DeGiusti ruled in favor of the tribes that gaming compacts automatically renewed on January 1. It's another defeat for Gov. Stitt, who's spent more than $1.5 million arguing that the compacts expired on that date. #StrongTribes #StrongOklahoma pic.twitter.com/CeBqQMFyPw
— United For Oklahoma (@UnitedForOK) July 28, 2020

Since 2005 -- after the first Class III gaming compacts were signed following voter approval -- tribes have shared more than $1.28 billion with the state, according to the Oklahoma Gaming Compliance Unit's most recent report. The money is derived from a percentage of revenue from electronic devices such as slot machines, as well as revenue from table games like blackjack and ball and dice games.

An updated reported is expected soon. But it will cover fiscal year 2019, so it won't address the widespread and damaging impacts of the coronavirus, which kept every tribal casino in Oklahoma shuttered for months as Stitt, who confirmed he contracted COVID-19 after attending a campaign rally with President Donald Trump in late June and after coming in close contact with Kialegee and UKB leaders on July 2, tried to force tribes to negotiate new agreements.

"This is a great day!" Choctaw Chief Gary Batton said in a statement on Tuesday. "This is a strong affirmation of what we have known all along. The plain language of the compact stated that it renewed on January 1, 2020."

"We are grateful this issue has been resolved and are ready to put it behind us," Batton continued. "We look forward to continuing to serve our tribal members by providing health care, education and jobs in the communities where we live and work.”

Since 2004, tribes have paid $1.28 billion to the state of Oklahoma in exclusivity fees. Tribes set a record in fiscal year 2018, paying nearly $138.6 million to the state, an increase of 3.48 percent from the prior fiscal year. Source: Oklahoma Gaming Compliance Unit Annual Report, Fiscal Year 2018

Stitt is only the second governor in Oklahoma's history to claim Native American ancestry. Despite his unique standing, he has increasingly found himself at odds with tribes since taking office in January 2019.

"The damage that Governor Stitt caused, because of his stubbornness on his view of the gaming compact," Cherokee Chief Hoskin told Indianz.Com earlier this month, "has made a relationship with him difficult but not impossible."

"That is sort of an inherent difficulty that we have in dealing with the governor," Hoskin continued. "I expect that to improve over time."

Stitt instigated the compact fight shortly after becoming governor but found few allies in his efforts to force tribes into sharing even greater percentages of their revenues with the state. His response to the federal court ruling did not improve his standing, said Chief Justin F. Wood of the Sac and Fox Nation.

"You can't and won't win every political battle. Let's move on and refocus," Wood, a Republican former state lawmaker, wrote in a post on social media on Tuesday. One responder said the chief appeared to be "wasting" his time in trying to appeal to Stitt's sensibilities.

Can we just work on uniting all four million Oklahoman's @GovStitt ? I'm not sure how your press release solved anything other than create more uncertainty - we are stronger when we work together. You can't and won't win every political battle. Let's move on and refocus -
— Justin F. Wood (@Justin_F_Wood) July 28, 2020

In his statement about the gaming compacts, Stitt cited uncertainty raised by the recent U.S. Supreme Court victory in McGirt. v Oklahoma. By a vote of 5 to 4, the justices on July 9 held that the state can no longer exercise "unlawful" criminal jurisdiction on the reservation of the Muscogee (Creek) Nation.

"Among other things, we will need to explore the challenges of who will pay taxes and who won’t, of how we will guarantee a competitive marketplace, and of how the state will fund core public services into the next generation," Stitt said, bringing up issues that were not in consideration at all in McGirt. "In short, we face a question of constitutional proportions about what it means to be the state of Oklahoma and how we regulate and oversee all business in our state."

In response to McGirt, Stitt has formed what he is calling The Oklahoma Commission on Cooperative Sovereignty. He stacked it with a slew of non-Indian political, energy and economic figures after being cut out of ongoing talks between Attorney General Hunter and the Cherokee, Chickasaw and Choctaw nations, Indianz.Com reported last week.

"The Oklahoma Attorney General has just been so engaged on this subject," Cherokee Chief Hoskin said earlier this month. He said Hunter has maintained "really such an open door" to tribes.

"That's the reason our lead person we meet with, is him," the chief said of Hunter.

After being cut out of the loop by tribes and a rival Republican, the governor of #Oklahoma is stumbling his way into a treaty rights controversy through a new commission stacked with non-Indian interests. @GovStitt @UnitedForOK #McGirt #HonorTheTreaties https://t.co/Wbxkv16CiM
— indianz.com (@indianz) July 22, 2020