Igra's Imbalance

79 Pages Posted: 15 Dec 2005

Date Written: December 13, 2005

Abstract

Indian gaming is headed in a direction that benefits neither tribes nor states. Tribes and states are caught in a prisoner's dilemma, with no side trusting the other and Congress refusing to see the forest for the trees. Tribes and states are in need of a vision and a simple legislative fix that benefits both sides and cuts right to the heart of the imbalance in IGRA.

The solution to these salient political issues is not piecemeal legislative efforts initiated in response to these alleged problems. These problems are symptoms of an imbalance in the overarching federal statutory scheme - IGRA. The Act created a balanced and careful relationship between Indian tribes (and to a lesser extent, the federal government) and the various states. The crux of that statutory scheme was a Congressional waiver of state sovereign immunity that allowed Indian tribes to sue the states and force their governors to negotiate with tribes over gaming compacts. The Supreme Court, however, in Florida v. Seminole Tribe of Florida, obliterated that balance in favor of the sovereign immunity of the states. This paper will show how the alleged problems relating to off-reservation gaming, tribal lobbying matters, taking of land into trust for gaming purposes, and the regulation of Indian gaming that attract Congressional attention can be traced back to that moment when the Court ruptured the balance.

Indian tribes and the federal government took several steps in order to alleviate the negative impact of Seminole Tribe on Indian gaming. Indian tribes and the states began to negotiate broader revenue sharing agreements, a process some have labeled extortion of Indian tribes by states. Concurrently, the federal government, specifically the Secretary of Interior, proposed an administrative fix to the Seminole Tribe problem that would allow the Secretary to promulgate Class III gaming procedures for tribes that do not have the opportunity to negotiate a gaming compact. The Congressional agenda evidenced by the Senate Committee's hearing schedule and the subject matter of the various bills being debated amounts to looking at the question of Indian gaming in a superficial and inefficient manner. The origin and the core of the disputes between tribes, tribal constituents, states, state constituents, private economic interests, and the federal government is the fact that IGRA is unbalanced. The Congressional agenda ignores an elephant in the room, one that neither states nor Indian tribes wish to litigate or even discuss. That issue is whether revenue sharing agreements contained in gaming compacts are valid in accordance with IGRA. These revenue sharing agreements are the creaky bridge between the states and the tribes that operates as the de facto Seminole Tribe fix. In short, many Indian tribes have agreed to pay the states a portion of their net win in exchange for a favorable gaming compact. The critical weakness in this plan is the fact that IGRA prohibits state taxation of Indian gaming revenues.

This paper proposes a legislative fix to IGRA that would validate both the current revenue sharing agreements and the administrative solution to Seminole Tribe. The proposal would provide all sides with a significant win-win opportunity. Moreover, this proposal avoids the constitutional jaws of the federal courts that sunk the original intent of IGRA by offering the choice to states to waive their immunity. Unlike most other proposals or analyses designed to fix IGRA proposed by legal commentators, this proposal is salable as a matter of real-world politics and is a practical solution to real-world problems. This paper's legislative proposal is neither wishful thinking nor comprised of pie-in-the-sky arguments. It is a pragmatic view of the state of modern Indian affairs on the controversial and enormous issue of Indian gaming. It proposes legislation that recognizes the governmental parties affected by Indian gaming, provides benefits to all of them, and preserves Indian gaming in the long-term by strengthening the operative statute.

Suggested Citation

Fletcher, Matthew L. M., Igra's Imbalance (December 13, 2005). Available at SSRN: https://ssrn.com/abstract=870069 or http://dx.doi.org/10.2139/ssrn.870069

Matthew L. M. Fletcher (Contact Author)

University of Michigan Law School ( email )

500 S. State Street
Ann Arbor, MI 48109
United States

HOME PAGE: http://https://michigan.law.umich.edu/faculty-and-scholarship/our-faculty/matthew-lm-fletcher

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