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As the Indian gaming industry continues to
expand, debate over the distribution of per capita payments to tribal members
has grown as well. While the payments have, in some cases, brought tribal
members from abject poverty to wealth, opponents argue that it’s bad for
tribal unity and for a tribe’s overall economy.

Of the 73 gaming tribes who distribute per
capita payments to tribal members, the amounts of these payments vary widely.
Members of the Comanche Nation of Oklahoma receive about $900 a year from their
gaming operations, while members of the Santa Ynez Band of Chumash Indians of
California each receive $30,000 a month. (Yes, per capita payments are subject
to federal income tax.)

The dramatic increase in the wealth of
some individual tribal members has become a two-edged sword. It has banished
poverty, enabling families to buy houses and cars, start their own businesses
and set up trust funds for children. But members worry that children and young
adults will receive so much money from these trusts that they will have no
incentive to finish school or train for jobs.

One tribe found a way to successfully
combat this concern. The Fort McDowell Yavapai Nation of Arizona fines the
families of students who are truant or chronically late for school $100 a day,
and takes the money out of their per capita payments. Since the fines started in
2002, the number of passing students has risen from 44 to nearly 90 percent, and
graduation rates have gone from 40 to 70 percent.

But as the population of tribes increases,
net gaming revenues won’t necessarily keep up with the demand.

The Puyallup Tribe of Tacoma, Washington,
pays each of its members $2,000 a month. Since 2002, when the payments began,
tribal membership has increased by 1,000 people. Last year, the payments took
$83.5 million out of the casino’s $126 million net revenue. This year, tribal
membership is expected to increase by another 229, increasing the demand for per
capita payments by $5.5 million.

This has created an economic treadmill
that can’t easily be altered, and members have grown dependent on the
payments. To meet this demand, the tribe has restructured more than $130 million
in loans, paying only the interest for the next five years. Critics say there is
no plan for dealing with this long-term debt.

To deal with growing membership, some
tribes have had to cut back their per capita payments. The Ho-Chunk Nation of
Wisconsin was forced to cut its payments by 30 percent, and the Cabazon Band of
Mission Indians in California reduced its $14,000 monthly payment to its 32

In other cases, disputes have erupted over
tribal membership and members have been disenrolled. Ousted members of the
Pechanga Band have sued for $38 million in withheld payments. In South Dakota,
members of the Flandreau Santee Sioux Tribe who were excluded from receiving
payments sued to stop the use of all gaming revenues.

Speaking at last year’s Global Gaming
Expo in Las Vegas, Ernie Stevens Jr., chairman of the National Indian Gaming
Association, noted, “The per capita destroys your economy and your

The Comanche Nation of Oklahoma is feeling
the effects of its per capita plan. Chairman Wallace Coffey told The
that the per capita program would eat up $11.6 million of the $29
million the tribe expects to make from its four casinos and would derail an
expansion plan.

But the majority of gaming tribes
(three-fourths) do not give out per capita payments. Instead, they invest their
profits in social programs, education, housing, healthcare, economic
development, neighboring communities and charitable causes.

If the fallout from per capita payments
includes family disputes, dis-enrollment, an overly pampered next generation and
greater overall tribal debt, it appears that some tribes are in danger of
eroding the very thing they hoped to foster by becoming gaming tribes in the
first place —economic independence and a sense of tribal unity. If they are
smart, they will be weary of walking down the white man’s path to their own

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