High Stakes of Indian Gambling

Article excerpt

Once again Congress has ducked a responsibility that rightly belongs to it by turning over the task of investigating the spread of legal gambling in America to an appointive body. In this case it's a nine-member commission set up under a federal law passed last summer.

The law gives the commission, formally known as the National Gambling Impact Study Commission, just two years to complete the job, making it almost a certainty that down the road its life will be extended. Its job is huge. And the least part of its task lies in the two major gambling states, Nevada and New Jersey, in both of which the industry is highly regulated and carefully watched.

Gambling in one form or another has been legalized in every state except Utah and Hawaii. Thirty-nine states now have state-controlled lotteries with proceeds used for governmental purposes, such as helping support public education. Other legal gambling the commission will study includes casinos, card rooms, slot machines, and horse and dog racing.

But the issues that could well take up most of the commission's time and resources are gambling and gambling casinos on Indian reservations and Indian-owned lands. This is so in part because of the sheer number of tribes and casinos involved and in part because Indian casinos operate under different rules and different laws from the rest of the gambling industry. At last count, more than 200 Indian tribes had opened 237 casinos in 29 states.

Indeed, states that do not permit gambling elsewhere are powerless to prevent Indians from opening casinos on tribal lands. All told, it is estimated that Indian casinos take in somewhere between $4 billion and $5 billion annually.

The casinos operate under the aegis of the National Indian Gaming Commission (NIGC), which was established by Congress in 1988. Tribes wishing to open casinos or operate slot machines or horse and dog-racing tracks must get its approval. The NIGC operates under far less strict rules and regulations than those governing New Jersey and Nevada gaming operations. Just what effect this has on the industry as a whole is something the commission will have to delve into.

It will find that Indian casinos have a tremendous competitive advantage because they are tax-free if they are built on reservations or on lands that belong to a particular tribe or band. They pay no taxes at any level--federal, state or local.

The commission also may want to take a look at other facets of Indian gaming, including what tribes do with their casino profits. Much of the money does, in fact, go to improving tribal living conditions, including spending for education and housing. …