Blogger: Sault Tribe's Lansing Casino Won't Happen; Mayor Irresponsibly Dangles Economic Carrot

Turtle Talk

Commentary on Sault Tribe’s Proposed Lansing Casino
1.23.2012

I can’t not say anything, since this proposed casino is in our own backyard. But seriously? The mayor says in 12-24 months he expects construction to start, and then another year or so after that there will be a fully functioning Indian casino in Lansing.

Wow.

We’re going to predict that it won’t happen. No chance.

Off-reservation Indian gaming is the most hotly-contested, politicized issue in American Indian affairs right now and maybe forever. Think of the interests arrayed against a Lansing casino, let alone one owned by an Indian tribe. The Detroit casinos will be opposed because it will cut into their bottom lines, and the entire City of Detroit, the Michigan Congressional delegation, the unions,everyone will throw their weight against this casino proposal...

Of course, I’m no political scientist. Politics is money (see Citizens United) and anything can happen, including a backlash against Indian gaming that persuades Congress to ban off-reservation gaming. But the mayor’s three years is a dream, and kind of sick thing to promise to people in Lansing who might believe the mayor and see this as a real possibility for improving their lives. (Complete Blog Post)

Former NIGC Chair Opines Sault Tribe's Plans for Lansing Casino are Illegal

In this letter below, Phil Hogen, former chair of the National Indian Gaming Commission (NIGC), opines on plans by the Sault St. Marie tribe of Chippewa Indians to develop an off-reservation casino in Lansing Michigan.

In conclusions, Hogen writes:

In view of my experience as the longest-serving Chairman of the National Indian Gaming Commission, I was asked to review this matter by the Saginaw Chippewa Indian Tribe of Michigan, whose concern for integrity in the Indian gaming industry I share. Unless it is first determined that lands where tribes conduct their gaming under the Indian Gaming Regulatory Act truly qualify as Indian Lands, that integrity is at peril, and all concerned need to observe and uphold the applicable laws.

Phil Hogen Letter Re Lansing Casino

Detroiter Mike Malik isn't the First Shady Character to push Shinnecock Casinos on Long Island

hen-Oklahoma businessman Ivy Ong was the first to bankroll and push Shinnecock Casino plans. After electing new Shinnecock tribal leaders who were supportive of Ong’s scheme, the tribe entered into an agreement with Ong and ONG Enterprises on May 1, 2003, which gave Ong exclusive rights to develop and manage a Shinnecock casino. By the time Ong came to partner with the Shinnecock he already had a shady past. Subsequently, he pleaded guilty to federal conspiracy charges and was fined by the National Indian Gaming Commission for improper involvement with Seminole Indian gaming activities.

New York Times
The Big Gamble 3.23.2003

By Julia Mead

...Mr. Ong, who served four months under house arrest for his part in a 1995 counterfeit baby-formula scheme, called his guilty plea to misdemeanor charges a matter of expediency. He also disputed press reports that he patronized a slain Las Vegas loan shark and is a subject of a federal grand jury probe into the Seminoles' gaming operation in Oklahoma...

Long Island Business News
Oklahoma developer confirms Shinnecock casino deal7.13.2003

by Rosamaria Mancini
 Ivy Ong, a prominent Oklahoma developer best known for his work on gaming facilities, confirmed this week that he has signed a contract with the Shinnecock Indian Nation to build a casino on the East End of Long Island. Ong, a controversial figure with a criminal record, said he would provide the necessary funding for a 65,000-square-foot casino on a 79- acre site in Hampton Bays known as Westwoods... Ong has helped the Seminole Nation and Iowa Nation tribes build casinos. His criminal record stems from a counterfeit baby-formula scheme in 1996, according to news reports that cite court records. He pleaded guilty to two misdemeanor charges in federal court and testified against an associate who went to prison. The Daily Oklahoman also reported that his name surfaced in a murder trial as a loan shark customer of slain Las Vegas mobster Herbie Blitzstein. Ong has attributed his conviction to a failure to file paperwork, and he has denied knowing the people involved in the loan shark case...

The Oklahoman | NewsOK
Guilty plea expected in casino corruption
9.21.2007

A former casino developer was accused Thursday in a federal conspiracy charge of making illegal payments to at least three officials of the Seminole Nation to let him run tribal casinos. Ivy K. Ong, 65, of California also was accused of failing to pay $199,610 in federal taxes. He is to plead guilty today, his defense attorney, David Ogle, said. The charges:

• Ong is accused in the charge of paying $44,100 to one tribal official between October 2000 and March 2004. 

• He is accused of paying $7,190 in January 2002 to get a second tribal official's house out of foreclosure. 

• He is accused of paying $8,607 in April 2001 to renovate a third official's home... 

In January 2008, the National Indian Gaming Commission issued a final ruling, not involving the Shinnecock, on matters involving the Seminole which found that Ong and Carlo Worldwide Operations LLC had been managing an Indian gaming facility without a contract and improperly held a proprietary interest in Indian gaming activity. NIGC issued a civil fine of $5,150,000.


Ong's Assignment of Shinnecock Agreement to Detroit Interests
On March 19, 2004, according to correspondence from the National Indian Gaming Comission to the Shinnecock Nation Gaming Authority dated March 16, 2011, Ong transferred his Shinnecock casino rights to Gateway Casino Resorts. Some reports suggest Gateway paid Ong $25 million. Gateway Casino Resorts was organized in Detroit during 2003 with membership that includes the leadership of Marian Ilitch and Michael J. Malik, Sr.


Like Ong, Gateway Casino Resorts' Malik Also Has a Controversial and Criminal Past
In 1997 Malik was arrested for beating the 12-year old son of his then-girlfriend in the street of a residential neighborhood and sentenced to probation. In 1999 he was forced from the partnership that founded MotorCity Casino because at that time and subsequently he has failed to receive a commercial gaming license from the Michigan Gaming Control Board (MGCB). It was reported the 1997 arrest, IRS troubles and perhaps other circumstances contributed to MGCB concerns.

The AP broke a national influence peddling story in 2005 which contributed to the re-election downfall of Rep. Richard Pombo, then chair of the House National Resource Committee. Malik and Christoper litch hosted multiple higher dollar fundraisers at the MLB All Star Game in Detroit benefiting Pombo who was to chair Congressional Hearings on Capitol Hill two days later on the fate of Shinnecock Federal Recognition. Then later, Malik was found (2006 & 2009) on multiple counts to have violated political campaign finance laws and fined $10,500. Malik/Ilitch and affiliates have been associated with other political finance and lobbying scandals.

In 2008, an Arizona Court found Malik guilty of illegal discharge of a firearm; ordered him to community service; and fined him nearly $15,000. Also in 2008, a receiver in a federal ponzi scheme case filed suit in Federal Court (Goldberg v. Malik) alleging Malik’s involvement in a fraudulent transfer and Malik was subsequently ordered to repay $170,000.

Then there is the default on a $1 million line a credit; failure to pay property taxes; foreclosures; certificate of forfeiture, one month marriage to the mother of his 3-year-old son, etc. etc. etc.

News accounts in 2007 reported the chairwoman of the Los Coyotes Band of Indians called Malik “the Devil” and indicated he was “seducing” younger members of her tribe.

Malik’s then wife was forced to tell a Detroit Court in 2010 that he had a history of “bullying, intimidation and influence peddling.”

Shinnecock Advised to Submit Gateway Casino Resorts Agreements to NIGC for Approvals

NIGC Opinion | March 2011

On May 1, 2003, now-convicted felon Ivy Ong entered into an agreement with the Shinnecock Indians (Long Island, NY) to develop, construct, manage and operate gaming facilities for the tribe.  Mr. Ong and his affiliates were to be the exclusive manager responsible for hiring key employees; developing policies, procedures and internal controls; marketing and budgeting.

Ong transferred his exclusive rights under the Shinnecock agreement to Detroit-based Gateway Casino Resorts (Michael Malik & Marian Ilitch) on March 19, 2004.  It has been reported that Gateway paid $25 million to assume the agreement.  Collateral agreements are reported to include, but are not limited to, the March 2004 Assignment to Gateway, naming Gateway manager of the facility;  a March 2004 “Addendum” contemplating the acquisition and development of additional gaming sites; and a March 2004 consulting agreement which has Gateway developing internal controls and security and accounting systems for the casino.

On March 16, 2011, National Indian Gaming Commission (NIGC) counsel issued an opinion to Donna Collins Smith, Chairwoman of the Shinnecock Gaming Authority, advising that the Shinnecock/Gateway Agreement and associated agreements be submitted to the NIGC Chairwoman for approval under the Indian Gaming Regulatory Act (IGRA).  Counsel explained that such management contracts not approved by the Chairwoman are considered void.

If there has been a response from the Shinnecock or if the Shinnecock Gaming Authority has submitted the Agreement for approval, TVT is unaware of such.

Property Bay Mills Indians Acquired in 2010 not 'Indian Lands;' Not Sovereign or Tax Exempt

Because property is Indian “owned” does not automatically mean those lands are “Indian Lands,” a special and unique designation. Only Indian Lands are considered sovereign and as such exempt from the usual local taxes, fees, codes, regulations and laws. Property that is simply Indian owned is not considered sovereign and not exempt. 

In shutting down the Bay Mills Indian Community’s (BMIC) rogue off-reservation casino in Vanderbilt (MI) last March, the U.S. Federal Court (Judge Paul L. Maloney) ruled that the property the tribe acquired in Vanderbilt during 2010, located 100 miles away from the tribe’s Upper Peninsula reservation, are not Indian Lands. Specifically (from Judge Maloney’s ruling (pgs 10-11):

Section 107(a)(3) authorizes the earnings of the Land Trust to be used for two specific purposes: (1) improvements on tribal land and (2) the consolidation and enhancement of tribal landholdings. Bay Mills does not suggest or argue that the Vanderbilt Tract constitutes an “improvement on tribal land.” Bay Mills defends the purchase as authorized by the second purpose. In the context of this provision, the statutory language has a plain and obvious meaning. The word “consolidate” means “to bring together or unify.”9 The word “enhance” means “to improve or make greater” or “to augment.”10 Obviously, the purchase of the Vanderbilt Tract is an enhancement of tribal landholdings, as the additional land augmented, or made greater, the total land possessed by Bay Mills. However, the statute does not authorize every enhancement. The statute uses the conjunction “and” between the word “consolidation” and the word “enhancement.” The use of the word “and” cannot be ignored. See Williams v. Taylor, 529 U.S. 362, 404 (2000) (“It is, however, a cardinal principle of statutory construction that we must ‘give effect, if possible, to every clause and word of a statute.’”) (citations omitted). In order for the purchase of land to be an “enhancement” authorized by the § 107(a)(3), the purchase must also be a “consolidation.” The statute requires any land purchase to be both a consolidation and an enhancement. Under §107(a)(3), Bay Mills may use the earnings from the land trust to acquire additional land next to, or at least near, its existing tribal landholdings. The statute does not allow Bay Mills to create a patchwork of tribal landholdings across Michigan.

Prior to Judge Maloney’s ruling, both the National Indian Gaming Commission (NIGC) and the U.S. Department of Interior had issued similar opinions. From a memorandum provided to the NIGC Chairwoman, December 2010:

On Wednesday, November 3, the Bay Mills Indian Community opened an off-reservation gaming facility in Vanderbilt, Michigan. The considered opinion of the Department of the Interior Solicitor is that the land is not within a reservation, not held in trust, and not held in restricted fee. Accordingly, the Community’s new casino is not on Indian lands within the meaning of the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. §§ 2701- 2721, and the National Indian Gaming Commission lacks jurisdiction over it. We are obligated, therefore, to refer the matter to the appropriate law enforcement agencies.

 

Specifically by rulings and opinions issued by U.S. District Court, U.S. Department of Interior Solicitor and National Indian Gaming Commission, the Bay Mills Indian Community’s property in Vanderbilt are not Indian Lands.  And by implication, two other similarly acquired parcels BMIC controls in Flint Township (280 miles from its reservation) and Port Huron (350 miles away) are not Indian Lands.

Absent Indian Lands designation, those parcels are not presently sovereign lands, are not eligible for casinos under IGRA, and are not exempt from the usual taxes, fees, codes, regulations and laws. Or to put it another way, those properties should be taxed and fees collected timely as they would for any other such property owner. 

Despite representations, there is currently no need for any special agreements to provide for emergency services or to accept some negotiated fees in lieu of taxes over the Flint Township, Port Huron or Vanderbilt properties. Such would only serve to advantage the tribe's interests going forward not the interests of local taxpayers and citizens or the people of Michigan.

Mike Malik wins big with the proposed Port Huron casino; no license required, less taxes

The Michigan Gaming Control Board denied Michael J. Malik a license in 1999 requiring him to sell his ownership in Detroit Entertainment, LLC (what would later doe business as MotorCity Casino). Mr. Malik however is relentless in his quest to profit in an ongoing way from a Detroit area gambling establishment.

Since 1993, Malik (and his various partners including the Ilitch Family) has pushed plans to locate an off-reservation Bay Mills Indian Community casino in the greater Detroit area (the tribe already has two casinos on its Brimley, MI reservation):

• (1993) first at the former Sears store in downtown Port Huron;
• (1994) with Harrah’s in Port Huron Township;
• (1994) with Harrah’s in the Foxtown area of downtown Detroit;
• (since 2001) at the Thomas Edison Inn site in the City of Port Huron.

Blue Water Resorts, LLC, a Malik-created entity, had a “management” contract with the Bay Mills Indian Community which was converted to a “consulting” contract in late 2007. The converted agreement grants Malik the exclusive right to develop and run a Bay Mills Indian Community off-reservation casino in the Port Huron area should he be able to secure approval for such a facility on the tribe’s behalf. Malik’s venture stands to take in up to 30% of the net profits of any such casino for the first seven years of operation. The tribe would have additional debt owing Malik’s venture for up to 30 years. A “consulting” contract does not require the approval of the National Indian Gaming Commission (NIGC). Malik, in effect, avoids licensing scrutiny by the NIGC.

By securing the rights to develop and manage an off-reservation casino for the Bay Mills Indian Community on some parcel in Port Huron, Michigan; Malik gets the financial benefit of a significant gambling facility located in the greater-Detroit market but isn’t required to get a license from the Michigan Gaming Control Board.

Further, by securing rights to an Indian casino rather than a commercial casino; Malik and his partners will pay significantly less tax to state and local authorities.

The three commercial casinos in Detroit – of which Malik was denied a partnership interest in 1999 – are required to pay the State of Michigan 12.1% of net gaming revenues and the City of Detroit 11.9% of net gaming revenues.

An off-reservation Indian casino managed by Malik’s Blue Water Resorts, LLC would be required to pay the State of Michigan 9-13% of net gaming revenues on a sliding scale and would only be required to pay the City of Port Huron 2% of net gaming revenues leaving at least 9.9% of net gaming revenues on the table. The Bay Mills/Malik venture would not be required to pay neighboring cities, townships or the County of St. Clair any percentage of net gaming revenues (literally tens of millions of dollars each year).

Bay Mills tribe modifies casino agreement with Blue Water Resorts LLC

According to the Bay Mills News, the Bay Mills Indian Community's Executive Council met on Monday, Sept. 24, 2007 for a regularly scheduled meeting. Among its business, the council also approved a motion to change the terms of their contract with Blue Water Resorts, LLC (a casino development and management company controlled by Michael J. Malik, Sr.) from a "management contract" to a "consulting contract."

The MGCB denied Mike Malik a license, what makes anyone think he can get licensed by the NIGC?

The Michigan Gaming Control Board (MGCB) refused to grant Michael Malik a license as a partner of MotorCity Casino in 1999. He has failed to win any other license from the MGCB since. Malik has never been licensed to manage a casino and given his past history isn't likely to receive a license.

Malik claims his Blue Water Resorts LLC would have a multi-million dollar management contract for a Bay Mills Casino in Port Huron and would be paid 30% of net-win revenues for seven years . If the MGCB wouldn't license Malik, what makes anyone think that the National Indian Gaming Commission (NIGC) would approve a management contract under Malik's control?

This suggests that Malik is fronting for some other interests (maybe Marian Ilitch, Las Vegas players, Kerzner & Wolman, etc.) who will step in and purchase the management contract from Malik before he has to go before the NIGC.

It wouldn't be politically expedient today for Mayor Kwame Kilpatrick, reportedly a staunch opponent of any Port Huron casino, to see that Marian Ilitch, the proprietor of the Detroit's MotorCity Casino, is bankrolling the Port Huron casino proposal today; but if history repeats itself, Malik could avoid scrutiny by the NIGC by selling the Blue Water Resorts LLC mangement contract to Marian Ilitch or some other entity controlled by Ilitch Holdings, Inc. when and if he ever gets the many approvals needed to build a Bay Mills Indian Community casino in Port Huron.

The question is ... who is Michael Malik fronting for in Port Huron -- Ilitch or someone else -- and what implications does that secret have for Port Huron?

It was revealed this past year that Michael Malik's former MotorCity Casino partner Herb Strather (he also failed to receive a license from the MGCB back in 1999) has been fronting in Massachusetts for big time casino operators Sol Kerzner and Len Wolman.

Interior to take distance and history into account when considering off-reservation gaming applications

11.13.07

Let the games begin
St. Regis sues Kempthorne; NIGC's 'bright line' between classes II and III

Tom Wanamaker / Indian Country Today

SYRACUSE, N.Y. - Frustrated with continued delays in the processing of its application for a casino in New York's Catskill Mountains, the St. Regis Mohawk Tribe has filed a federal lawsuit against Interior Department Secretary Dirk Kempthorne.

The secretary, a former Republican governor of Idaho, is on record as opposing ''off-reservation'' casinos. The St. Regis application for a casino at Monticello has been ready since last February, and despite approval from New York Gov. Eliot Spitzer, Kempthorne has taken no action on it. Over the past several months, Mohawk leaders have repeatedly requested meetings with him; they have not been given the courtesy of an answer, much less a decision.

But we may have a clue as to Interior's future take on this supposed ''reservation shopping.'' On Oct. 1, Legal Times newspaper revealed the text of a letter sent to tribes with pending ''off-reservation'' casino applications by Interior Deputy Associate Secretary James Cason. In the letter, Legal Times reported that Cason said Interior is pondering a model ''where the likelihood of accepting off-reservation land into trust decreases with the distance the subject parcel is from the Tribe's established reservation or ancestral lands, and the majority of tribal members.'' [emphasis added]

Apparently geography matters. So the question now becomes: ''Will Interior take history into account?''

The ancestral Mohawk homeland lies along the majestic river that today bears the tribe's name. In the years leading up to the American Revolution, encroaching colonial settlers forced most Mohawks out of the area. Today, the tribe's sole American reservation is at Akwesasne, which sits along the St. Lawrence River, roughly 225 miles due north of Monticello as the crow flies. Other recognized bands of Mohawks reside in Ontario and Quebec.

But the ancestral Mohawk homeland lies only some 75 miles north of Monticello, one-third of the distance to Akwesasne. All ''off-reservation'' Indian casino applications are different, each with its merits and circumstances.

Cason's model should not be the sole deciding factor in the St. Regis application, or any application for that matter. But if it is going to play a role, Interior must take the historical displacement of tribes from their homelands into account. Many Indian nations, through no fault of their own, are today located on reservations distant from their original homes. If geography is to be a critical determinant in deciding the fate of a tribal casino, historical factors must carry equal or greater weight.

Proposed regulations

The National Indian Gaming Commission in late October issued a set of proposed regulations intended to clarify the distinction between Class II and Class III gaming machines.

The basic difference between the classes can be boiled down to whom the player is competing against. If the machine is linked to others and players play against each other, it's a Class II game. If the player is playing against the house, it's a Class III game. But the technological complexity of many new gaming devices; the fact that machines of different classes may appear to be identical, legal challenges regarding the classification of certain games; and confusion over whether a machine itself is the game or merely a tool through which to play the game has forced the need for a clearer demarcation between the two classes.

''These proposed standards will clarify the distinction between the technological aids tribes may use to play Class II games - bingo and the like - which may be utilized without compacts with their states, from that equipment used for the play of Class III games, such as slot machines, which may only be played when there is an approved tribal/state compact for that activity,'' said NIGC Chairman Philip Hogen in an Oct. 24 press release.

Hogen stressed the need for a clear distinction, a ''bright line,'' between the classes, citing disputes over technology that could challenge the ''dominant market position'' that many gaming tribes hold in Class II.

''Those challenges could come in the way of allegations that technology for Class II has gone beyond its limit,'' he said in the release. ''It could come as well by increased competition for this market where states expand their limits on bingo-type technology, if they see no meaningful constraints on tribal activity in this area.''

Of equal significance might be the potential impact on revenue sharing. Tribes offering Class III games must, of course, enter a tribal/state compact. Such compacts, more often than not, contain provisions for tribes to pay some percentage of their profits to the state that surrounds them.

But Class II gaming requires no tribal/state compact - tribes may offer Class II games free from state oversight and without revenue sharing. Thus anything perceived as weakening Class II and strengthening Class III gives gaming tribes the impression that state hands will sink deeper into their pocketbooks. Hogen said that the proposed rules should allay such fears.

''Bingo and Class II gaming is the bedrock upon which Indian gaming was built, and its integrity needs to be maintained,'' Hogen said. ''With the bright line that will be drawn when these regulations are finalized, tribes may confidently invest in equipment, lenders concerns over challenges in this area will be allayed, and tribes will have a clearer basis from which to negotiate with states for Class III compacts.''

To view the proposed regulations, visit www.nigc.gov. The regulator will accept public comments on them for 45 days after their publication in the Federal Register.

http://www.indiancountry.com/content.cfm?id=1096416079

Indianz.com: Judge orders Indian land determination on casino

as posted 7.18.07 at Indianz.com:

"Citing an administrative record 'lacking in substance,' a federal judge in Oklahoma today ordered the Interior Department and the National Indian Gaming Commission to determine whether land owned by the Chickasaw Nation qualifies for gaming.

The tribe signed a compact with the state to conduct off-track betting at several locations. But the Bureau of Indian Affairs never determined whether a particular site could be used for gaming, Judge David L. Russell said in a 10-page opinion.

'The court concludes that because it is not apparent from the administrative record that the proper determinations were made with regard to the Chickasaw off-track wagering compact, that this matter should be remanded to the Secretary for further proceedings consistent with this opinion,' Russell wrote.

The land at issue was taken into trust after 1988. Under the Indian Gaming Regulatory Act, that means it can't be used for gaming unless it meets one of the exceptions in Section 20 of the law.

The Chickasaw Nation claimed a former reservation exception that applies to Oklahoma tribes. But Russell said there was 'insufficient' evidence in the record to support the claim.

'The court concurs, and again, concludes that such a finding was necessary before the Compact could be approved, and that in the absence of such a determination, the approval of the Compact was arbitrary and capricious,' he wrote.

This is the second time in recent months that a federal judge has ordered an Indian lands determination. In New York, the NIGC was taken to task for failing to determine whether the Seneca Nation could open a casino on land taken into trust after 1998.

Get the Decision: Apache Tribe v. US (July 18, 2007)"

Michael Malik, a casino syndicator, has never been approved for gaming license

Michael J. Malik, Sr., failed to qualify for a gaming license with the Michigan Gaming Control Board (MGCB) in 1999 and was reportedly forced to transfer (or sell) his original shares in the MotorCity Casino venture to Marian Ilitch (details never disclosed).

Susbsequently, a venture owned/controlled by Michael J. Malik, Paradice Hunt Club LLC, submitted a vendor licensing exception application to the MGCB but no exemption appears to have been granted.

Malik, a recognized casino syndicator, is not known to have been granted a gambling license by any entity. Marian Ilitch has been licensed by the MGCB.

Here's a check list provided by the National Indian Gaming Commission (NIGC) that's used in the investigation of licensing determinations for Indian casino management contracts it must approve.

It 's reported that Malik and Ilitch have agreements with the Shinnecock Indian Nation, Bay Mills Indian Community, Big Lagoon Rancheria and Los Coyotes Band of Cahuilla and Cupeno Indians to not only develop any future casinos but also provide management services in the years immediately following opening of any gaming facilities established by these tribes.

CA Political Influence: Labor Unions vs. Native American Interest

California

Political Contributions

2000-2006

Labor vs. Native American

Sector	# of Contributions	Total $
Labor Interests	8,070	$55,164,043
Public Sector Unions	3,709	$32,714,968
General Trade Unions	3,680	$21,302,790
Transportation Unions	681	$1,146,285
Native American Interests	1,284	$6,399,035
Indian Gaming	40	$498,250
Tribal Governments	1,244	$5,900,785

Data obtained from the National Institute on Money in State politics

CA Indian Gaming #1 in US

as posted 6.05.07 by KQED's JohnMyers at Capitol Notes:


Newly released data from federal regulators finds that tribal casinos in California, combined, are the most profitable Indian gaming operations in the nation.

The big picture analysis from the National Indian Gaming Commission was released yesterday-- showing that nationwide, Indian gaming was a $25 billion industry in 2006.

Today, a little more detail from the NIGC about tribal casinos in California (and one tribal casino outside of Reno, NV which is included in the commission's regional data). The NIGC says Indian gaming here racked up profits of almost $7.7 billion last year. That's about 31% of the entire nation's tribal gambling revenues.

Or put another way... 31 cents of every dollar spent at Indian casinos in the U.S. in 2006 was spent in this region.

And another sense of the size of the Indian casino industry in the Golden State: in 2001, total revenues were about $1.7 billion. That means 2006 revenues are an increase of more than 450% in just the last five years.

Only tribal casinos in the northeastern and southeastern U.S. came close to California, with a combined revenue of $6.2 billion.

The report also gives some sense of the size of various Indian gaming operations in the nation. It shows that of the 387 tribal casinos operating in 2006, more than 84% of the revenues came from only 108 of those casinos.

And at the very top: 23 tribal casinos, which each had revenues of above $250 million. In fact, those 23 casinos accounted for a whopping $11.2 billion of all tribal gaming revenues in the nation (the NIGC won't disclose where California tribal casinos fell in this range, saying the information is proprietary).

You can find the overview on the NIGC's website.

Gaming chairman expresses concern over rules

5.15.07

Lack of standards could cost millions

By James P. Sweeney
COPLEY NEWS SERVICE

SACRAMENTO – The chairman of the National Indian Gaming Commission yesterday warned that the absence of federal standards in Indian casinos could attract crime and cost tribes untold millions of dollars.

The future without the internal operating rules, which were invalidated by federal courts, “will be a time of some uncertainty and doubt,” Chairman Philip Hogen said in remarks prepared for the Assembly Governmental Organization Committee.

“Operations without effective internal controls and oversight will, once again, become obvious targets for the unscrupulous,” Hogen predicted. “Those tribes . . . will lose millions of dollars and often not realize that it has happened until years later.”

Federal courts invalidated what are known as “minimum internal control standards.” The guidelines set standards for the security at casinos, including cash handling, cage and credit operations, internal audits, surveillance and the games – from technical requirements to how often decks of cards should be changed.

Since the ruling became final last year, Hogen has been on a crusade to persuade Congress to restore the commission's authority to impose and enforce the rules for all Indian casinos.

In California, the loss of the federal standards has become a sticking point blocking ratification of five new tribal agreements, or compacts, that promise 22,500 more slots and another major gambling expansion in Southern California.

Gov. Arnold Schwarzenegger negotiated the pending deals last year with Sycuan of El Cajon, Pechanga of Temecula and three other big gaming tribes. The agreements would run for 23 years and pay the state a larger cut of gaming revenues, up to 25 percent from some machines.

But Assemblyman Alberto Torrico, a Fremont Democrat who chairs the Governmental Organization Committee, has questioned the state's ability to regulate the casinos and assure the state's share of revenues without the federal standards in place.

Torrico sparred repeatedly with an attorney for the governor and the chairman of the California Gambling Control Commission.

Sylvia Cates, deputy legal affairs secretary for the governor, and Dean Shelton, the state commission chairman, both said California's compacts require operating rules similar and, in some cases, identical to the federal standards.

Moreover, most tribes have adopted rules at least equal to the federal rules, Cates said.

The state has requested $1.7 million and 14 added positions in the new budget to expand its field presence and begin the transition from federal to state enforcement of the rules.

But, if the state has ample oversight authority, Torrico asked, why is it pushing tribes to accept a new administrative regulation that would require all gaming tribes to comply with standards at least as stringent as the federal rules? Why also, he asked, has the governor implored Congress to restore the federal rules?

“My goal is to ratify these compacts,” Torrico said at the end of the hearing. “But none of the compacts will be ratified until this issue and the others I have mentioned before are addressed fully.”

Find this article at: http://www.signonsandiego.com/news/state/20070515-9999-1n15casinos.html