Class III Tribal and Other Authorities that Control Indian Gambling

Once a Class II gambling enterprise becomes operational, NIGC is authorized to monitor, inspect, and examine the gambling premises, as well as review and audit the operating records. NIGC has the broad authority to determine whether a tribal gambling operation is complying with the provisions of IGRA, NIGC regulations, and tribal regulations. If NIGC believes any of these provisions have been violated, it is empowered to issue notices of violation, closure orders, and civil fines up to $25,000 per day, per violation. 48

The Commission and the Subcommittee have heard testimony that, in the past, the NIGC had been underfunded and understaffed, and that neither the NIGC nor state regulatory authorities have been able to prevent tribes from operating uncompacted gambling facilities in some states. This situation may have improved: With the passage of federal legislation amending IGRA in October of 1997, the NIGC has been empowered to impose fees upon both Class II and Class III gambling activities. This change has increased the NIGC’s annual level of funding and has allowed for a significant increase in the number of field investigators and compliance officers. The NIGC reports having issued more notices of violation, closure orders, and civil fines during the period between October 1997 and end of 1998 than during the entire life of the Commission prior to that point. According to its own figures, those efforts have proven successful in bringing more than 95 percent of all the tribal gambling facilities into compliance with federal law.

Class III Tribal/ State Regulation
NIGC’s original purpose and focus was the regulation of Class II gambling. The explosive growth of Class III gambling has resulted in a greater emphasis on this area as well. NIGC has been assigned a number of responsibilities regarding the regulation of Class III operations, such as conducting background investigations on individuals and entities with a financial interest in, or a management responsibility for, a Class III gambling contract. In addition NIGC reviews and approves Class III management contracts. However, NIGC’s regulatory responsibilities and authority regarding Class III gambling are far more limited than for Class II because IGRA gives the primary responsibility for the regulation of Class III gambling to the tribes and the states.

Under IGRA, the conduct of Class III gambling activities is lawful on Indian lands only if such activities are:
· authorized by an ordinance adopted by the governing body of the tribe and approved by the Chairman of the NIGC;
· located in a state that permits such gambling for any purpose by any person, organization, or entity, and;
· conducted in conformance with a tribal-state compact that is in effect.

IGRA requires that tribes and states negotiate a compact covering, among other things, the regulation of Class III gambling on Indian lands. 49 The primary responsibility to regulate Class III gambling is with the tribe. States may, but are not required to, provide some form of regulatory oversight of Indian Class III casino games under the compact provisions of the Act. 50 Therefore, the level of state and tribal regulatory oversight in any given state is determined by the voluntary compact negotiations between the tribe and the state.

48 25 U. S. C. §2712( a)( 1). 49 Section §2710( d)( 3)( A) states: “Any Indian tribe having jurisdiction over the Indian lands upon which a Class III gaming activity is being conducted, or is to be conducted, shall request the State in which such lands are located to enter into negotiations for the purpose of entering into a Tribal-State compact governing the conduct of gaming activities. Upon receiving such request, the State shall negotiate with the Indian tribe in good faith to enter into such a compact.” 50 25 U. S. C. §2701( 14)( a)( 1-3).