A letter to Gov. Arnold Schwarzenegger (R) from the California Tribal Business Alliance (CTBA) has sent emotions soaring in the last week. Paula Lorenzo, the Chair of CTBA, encouraged the governor to look into the use of electronic gaming machines that the alliance says are not authorized by tribal-state compacts. In the letter, Lorenzo stated that the alliance was "aware of several thousand purported Class II machines being operated by tribes with compacts ”¦ which do not have the approval of the NIGC."
As outlined in the Indian Gaming Regulatory Act, Class II games include bingo and games with similar elements of play, which may be enhanced by "electronic, computer or other technologic aids." A state compact is not needed for tribes to operate Class II games, and they are regulated by the NIGC and the tribes themselves.
Class III games include slot machines, which require a state compact in order for a tribe to offer them. Tribes in California have rights of exclusivity when it comes to slots””non-Indian casinos cannot legally operate them. Compacts for Class III gaming impose tighter restrictions””there is a limit to the total number of machines that may be operated; the State Gaming Agency takes a regulatory role; revenue from slots must be shared with the state; and tribes must mitigate environmental impacts.
The CTBA is relatively new to the scene. Formed in 2004, it consists of just six charter member tribes including the Palas, Paskenta, Pauma, Rumsey, Viejas and United Auburn Indian Community. The alliance is concerned about the new electronic bingo machines that many have argued too closely resemble Class III slot machines. Attorney Howard Dickstein stated that the alliance was afraid that unregulated Class II machines could cause a backlash at the state level, and tribes could lose the monopoly they have on slot machines.
Lorenzo’s letter to the governor accused tribes of offering the ambiguous Class II games "to avoid revenue sharing payments" and "avoid mitigation of environmental impacts."
The letter received flaming responses from California Nations Indian Gaming Association Chairman Anthony Miranda and the Pechanga Band of Luiseno Indians. Miranda called Lorenzo’s comments "inappropriate, inflammatory, and insulting" and said the letter made "misleading allegations that tarnish the integrity of tribes throughout America." He reiterated that California tribes pay millions of dollars in revenue sharing to the state, to local communities and to the Special Distribution Fund, and reaffirmed the legality of the Class II games currently in operation. Miranda demanded an apology from the CTBA.
A statement from the Pechanga Band called Lorenzo’s comments "appalling and unsubstantiated." The Pechanga, along with the Morongo of east Riverside County and the San Manuel of San Bernardino, have installed large numbers of Class II machines that the CTBA find questionable. All three tribes contend that their machines have been approved by NIGC and are perfectly legal.
Pechanga’s statement essentially accused the CTBA of sticking its nose where it doesn’t belong. The tribe noted that during recent routine inspections of their facility, "the State had no problem in identifying Class II games" and that any questions regarding the validity of machines are, by compact agreement, worked out between the state and the tribe itself.
The CTBA’s letter is well timed. This week will wrap up the comment period for the Department of Justice’s proposal to amend the Indian Gaming Regulatory Act. If adopted, the changes will throw out IGRA’s definition of Class II machines; strip NIGC of some of its authority; give the DOJ exclusive power to prosecute any wrongdoing; and impose tighter restrictions on nearly every aspect of Indian gaming.