NIGC moves forward with regulatory agenda in 2007

Tuesday, May 1, 2007

The National Indian Gaming Commission updated its regulatory agenda on Monday but tribes won't find many surprises in the document.

The agency in charge of the $23 billion tribal casino industry has completed just one regulation in the past 18 months. The Freedom of Information Act Procedures rule went into effect in March 2006 after being published in the Federal Register.

That doesn't mean the NIGC hasn't been busy. Officials spent much of the past year consulting tribes about changes to Class II machines that would have had a major impact throughout Indian Country.

The controversial rules were subsequently withdrawn amid tribal complaints. And now they are back in the "proposed" rule stage, according to the agenda released on Monday.

Overall, NIGC has 11 rules in the "proposed" stage and five rules defined as "long-term actions." No new rules have been completed since December 2006, the last time the agency updated its agenda.

But NIGC Chairman Phil Hogen said the agency plans to update and modernize several regulations this year. The agenda includes annual fees, definition of net revenue, management contracts, background investigations and facilities license requirements.

In a letter to tribal leaders on March 26, Hogen described most of the proposals as "technical" or "housekeeping" in nature. "The aim of these revisions is to simplify and clarify specific areas of NIGC regulations," he wrote.

Among other actions, the proposed changes would reduce tribal reporting requirements from four times a year to two, clarify key definitions such as net revenue and add some requirements to the management contract approval process.

"The proposals for annual audits should accommodate tribes with multiple gaming operations and make the process less onerous for the smallest operation and the definition of net revenue will conform to current accepted accounting practices," Hogen said in a statement on March 28.

"The management contract regulations have been in need of revision for some time and these proposals should bring them up to date and streamline the process," Hogen added.

In another letter, also on March 26, Hogen described a somewhat more complex rule for facility licensing. The rule has been in development for more than a year and would require tribes to certify that their casinos are located on Indian land, as defined by the Indian Gaming Regulatory Act, and that they meet environment, health and public safety requirements.

According to the agenda released yesterday, NIGC plans to publish notice of the rule in October of this year. "IGRA has always provided that Tribes license their gaming facilities, as well as constructing and operating them in a manner that safeguards the environment and health and public safety," Hogen said in a statement.

The two letters sent to tribal leaders set a deadline of May 15 to submit comments to NIGC.

On a separate issue, NIGC is still looking for a legislative fix to a critical court case. Last year, the D.C. Circuit Court of Appeals said the agency lacked the authority to regulate Class III gaming because IGRA left that role to tribes and states through the compacting process.

Efforts to override the decision failed in Congress last year due to tribal opposition. In NIGC's Spring 2007 newsletter, Hogen said he is worried that the court ruling could be "misread" to lock the NIGC out of areas like management contracts, ordinance approval and compliance and compact compliance.

"NIGC is and will still be very much engaged in these areas and we are working to clarify any confusion which may have developed in this regard," Hogen said in the newsletter.

NIGC Update:
Semiannual Regulatory Agenda (April 30, 2006)

Prior Update:
Semiannual Regulatory Agenda (December 11, 2006)

Relevent Documents:
Letter to Tribal Leaders on Proposed Changes to NIGC Regulations | Letter to Tribal Leaders on Proposed Facility Licenses | Proposed Revisions to NIGC Regulations | Summary of Technical Standards Revisions | Proposed Facility Regulations | Spring 2007 Newsletter