If ever a congressional enactment deserved a big birthday cake on its 20th birthday, the Indian Gaming Regulatory Act (IGRA) would certainly qualify. While there was cautious optimism that this legislation would foster economic development in Indian country when passed in 1988, I doubt that any of the sponsors or supporters would have envisioned the vibrant healthy industry that the act has fostered. In commemorating this landmark legislation, it must be quickly noted that it was not IGRA that started the Indian gaming industry, rather, IGRA “caught up” with a burgeoning, albeit small, Indian gaming industry that was the creature of tribal ingenuity, entrepreneurship and tenacity, sometimes in the face of formidable obstacles. Again, “Indian gaming” is not a federal program; the Indian Gaming Regulatory Act merely gave some structure to economic development tools that many tribes were already utilizing and likely would have further developed in some similar form had the legislation not been adopted.
Historically, the legalization and success of gambling businesses in the United States has been cyclical. The Indian gaming industry fortuitously began its growth, fostered by IGRA, after other jurisdictions, primarily Nevada, learned difficult lessons about the risks of inadequately regulating legalized gambling. Building on those lessons, the Indian gaming industry, and the approach which was taken to its regulation, got a running start.
All effective gaming regulatory structures first focus on making suitability determinations for those who participate in gaming’s operations; secondly, they write and enforce rules to assure the fairness of the play by the gamblers and the operators of the gaming facility; and thirdly they intensely follow and document the flow of revenues to assure that the proceeds remaining after payment of the prizes flow to the intended beneficiaries. In the case of Indian gaming, IGRA not only mandates that these three principals be followed by tribal operations, but that tribal governments place such requirements in their tribal gaming ordinances that govern gaming in Indian country.
IGRA rightfully placed primary responsibility for the regulation of tribal gaming on the tribes themselves. The tribes have responded magnificently to that challenge. Today, tribal gaming commissions or tribal gaming regulatory authorities are among the most sophisticated regulators anywhere in the gambling industry. Congress created the National Indian Gaming Commission (NIGC) to validate the regulation primarily tasked to the tribes, giving NIGC a general oversight role, and specific oversight role with respect to class II or bingo and similar games. States roles are to be determined by the compacts tribes would negotiate with them for the regulation of casino gaming. While there have been instances of concern in the 20 years that IGRA has been applicable, the vast majority of tribal gaming has been problem free and has proved to be the economic development tool Congress intended in IGRA.
One of the more specific changes which IGRA brought about 20 years ago was to remove the absolute prohibition of “gambling devices in Indian Country,” which had been imposed with the enactment of the “Johnson Act,” passed by Congress in 1951. Court victories which tribes won over states that attempted to apply state criminal limits and regulations to tribal gaming, such as the landmark Cabazon decision in 1987, established tribal rights to regulate their gaming on their lands.
Slot machines and electronic facsimiles of games of chance-far and away the largest revenue generators in modern gaming facilities-were not permissible until IGRA’s enactment. Such gaming, of course, even under IGRA, is only permissible if tribes enter into negotiated Class III compacts with their states for that activity. Those compacts increasingly bring the requirement of sharing gaming revenues with states in exchange for some degree of exclusivity to conduct casino gaming. Today several states look to tribal gaming revenue sharing as a major source of funding. A continuing challenge to the Indian gaming industry is to clearly identify the dividing line between computers and electronic and technologic aids which tribes may utilize to play bingo and such “Class II” games, from that equipment which remains impermissible under the Johnson Act without a tribal-state compact.
Not withstanding the presence of some ongoing challenges, the success of the economic development IGRA has helped bring to Indian nations, Indian people, and the communities where they are located, cannot be questioned. Like so many other industries, gaming flourishes best in densely populated metropolitan areas, and of course many tribes are in remote and rural areas, where huge revenues cannot be generated from gaming. However, even many of those tribes bring needed employment to their reservations with their bingo halls and small casinos. With gaming revenues, tribes have been able to meet the needs of children, education, elders, health care and many other areas, which otherwise would go unmet.
For decades, many tribal nations were practically invisible in their states and communities. With the economic success gaming brought, they have finally been recognized and respected as they had not been previously. Throughout Indian Country, tribal members walk with a new spring in their step, and a new sparkle in their eye, due in no small part to the fruits and success of Indian gaming, built on the framework which IGRA’s passage 20 years ago established.
Happy birthday, IGRA, and many happy returns!
