Frequently Asked Questions
Did the Indian Gaming Regulatory Act (IGRA) create Indian gaming?
No. Gaming is a right of American Indian nations. Large-scale Indian gaming, mainly in the form of bingo, predated IGRA by about ten years. The U.S. Supreme Court in 1987 recognized Indian tribe’s inherent right to run gaming when it ruled that states had no authority to regulate gaming on Indian land if such gaming is permitted outside the reservation for any other purpose (California v. Cabazon). Congress established the legal basis for this right when it passed IGRA in 1988.
How many tribes have signed compacts with the State of California?
On September 10, 1999, 58 tribal governments signed tribal-state compacts with Governor Gray Davis. Since that time, 16 additional tribes have signed tribal-state gaming compacts bringing the total number of approved compacts in California to 74.
Do non-gaming tribes benefit from Indian gaming?
Yes. For the first time in United States history, the compacts negotiated between the California tribal governments and the state of California included a provision for revenue sharing with non-gaming tribes.
Do tribal gaming facilities share revenue with the State of California?
Yes. Tribal governments included a provision, known as the Special Distribution Fund, in each of their compacts, which makes an assessment on the average gaming device net-win on approximately 19,005 gaming devices which were in operation prior to September 1, 1999. Tribal governments proposed this revenue sharing to ensure that revenue paid into the fund would go directly to support problem gambling prevention programs; to reimburse local governments for off-reservation impacts by tribal government gaming operations; to compensate the state for regulatory costs incurred in connection with its regulatory responsibilities; and to cover shortfalls in the tribal revenue sharing trust fund.
How do tribes use the revenue generated from Indian gaming?
Gaming on Indian reservations is operated by tribes to fund governmental programs. IGRA requires that all revenues from tribal gaming operations be used solely for governmental or charitable purposes. Much like state governments determine the use of lottery revenues tribal governments determine how gaming proceeds are to be spent. Indian tribes are using gaming revenue to build houses, schools, roads and sewer and water systems; to fund the health care and education for their people; and to develop a strong, diverse economic base for the future.
Are Indians required to pay taxes?
Yes. All Indian people pay federal income, FICA and social security taxes. Only the small percentage of Indians who live and work on their own federally recognized reservations – not unlike soldiers and their families living on military installations – are exempt from paying state income and property taxes. However, they still pay taxes such as sales and all other special and excise taxes.
Who supports Indian gaming?
Several polls taken over a couple of decades have demonstrated that majorities of Californians support Indian gaming. In 1998 California voters passed Proposition 5 with more than 63% voter approval. The following year Proposition 1A was passed with 64% of the votes.
How is Indian Gaming regulated?
The tribes, as governments, are the first to be vigilant in protecting the integrity of projects they rely upon to feed, clothe, educate and employ their people. Tribal governmental gaming is regulated on three separate and distinct levels, in contrast to the single level required for commercial gaming. The first level of regulation comes from the tribes themselves. With the establishment of the Indian gaming Regulatory Act (IGRA), tribes are mandated to establish a regulatory body (tribal regulators and commissions) to keep operations in compliance with local ordinances and state compacts. As stated in the IGRA, these regulatory bodies are the primary regulators of tribal government gaming. The State of California acts in a secondary role in the regulation of Indian gaming. The tribal-state compacts provide the secondary role for regulating Class III gaming for the Department of Justice – Division of Gambling Control and the California Gambling Control Commission. The third level of regulation is through the National Indian Gaming Commission (“NIGC”). The NIGC was created in 1988 when Congress enacted the IGRA. The role of the NIGC is to regulate Class II gaming operations in coordination with the tribal governments. In addition to these three distinct levels of regulation, tribal government gaming operations are also subject to oversight by the Federal Government; the Department of Justice, Bureau of Indian Affairs, the FBI, the IRS, the U.S. Attorneys, the U.S. Marshals, Attorneys General, the Secret Service, Treasury Department, and the Financial Crimes Network.
Does Indian gaming work as a means of economic development for tribes and states?
Yes. Indian gaming is providing substantial economic benefits in states where the tribes and states have worked together to develop mutual goals. IGRA is working to the benefit of Indians and non-Indians in several states, including California. Reservations are slowly recovering from decades of failed well-meaning governmental programs. Indians and non-Indians are proudly leaving welfare rolls and getting payroll checks. They are taxpayers instead of tax users. Local and state governments are enjoying increased tax revenues. Only in those few instances where states failed to negotiate fair compacts in “good faith” in violation of IGRA has the process not worked.
Are better economic development alternatives to gaming available to tribes?
Indian gaming is the first – and only – economic development tool that has ever worked on reservations. The majority of reservations are in remote, inconvenient locations on land that nobody else wanted. Before tribal government gaming, there had been little success with public or private sector economic development on reservations. The states have not proposed any specific or credible alternatives to Indian gaming as a meaningful source of tribal revenues and jobs. The National Gambling Impact Study Commission found that “no other economic development other than gaming has been found.” Moreover, tribal governments are using gaming proceeds to diversify and conduct other economic enterprises.
Do all tribal governments have casinos?
No. California is home to 108 federally recognized Indian tribal governments. As of November 2015, only 60 of the 108 tribal were engaged in gaming.
Why do tribes take lands into trust?
Tribal governments will take land into trust for a number of reasons; housing, road construction, building of clinics and detention centers, and economic development projects.