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NIGC updates regulatory agenda for 2007
Tuesday, December 12, 2006

The National Indian Gaming Commission is moving forward with rules affecting tribal revenues and casino site licensing, according to a notice published on Monday.

In its semiannual regulatory agenda, the agency presents a plan of action for the next few months. The notice in the Federal Register shows seven rules in the proposed stage, three in the final stage, five in long-term development and one completed rule.

The agenda contains no new surprises from the one published this spring. One proposed rule, regarding NIGC approval of management contracts between tribes and developers, has been pushed from the proposed stage to a long-term action.

Another rule, affecting the use of tribal gaming revenues, has advanced to the proposed stage. The rule seeks to ensure tribes are using their casino revenues in accordance with the Indian Gaming Regulatory Act of 1988.

The law lists five "public purposes" -- such as funding tribal government operations and promoting economic development -- for which revenues can be used. The NIGC hopes to issue a notice of proposed rule-making sometime this month, according to the notice, though no firm date is given.

Another significant rule is coming down the pipeline in March 2007, according to the notice. The "Gaming Facility and Site Licensing Licensing Standards" would require tribes to certify that their casinos are on Indian lands, as the term is defined by IGRA.

NIGC Chairman Phil Hogen has been talking about the proposal for nearly a year. It was slated for announcement in August but the agency continues to work on the rule.

One other rule has advanced from the long-term action to the proposed stage. "Definition of Sole Proprietary Interest" seeks to define a key term of IGRA, one that has gained significance in recent years as more third parties invest in the $23 billion tribal casino industry.

According to the notice "IGRA requires, with one limited exception, Indian tribes to have the sole proprietary interest and responsibility for the conduct of any gaming activity on the tribes’ Indian lands."

IGRA doesn't define that term and NIGC doesn't have any regulations on the matter. But Hogen has said he wants to make sure tribes aren't being swindled by developers who finance casinos in exchange for a cut of the revenues or other interests.

Along with these proposals, the NIGC is in the process of finalizing three highly controversial regulations. One seeks to amend the Minimum Internal Control Standards, a set of complex and comprehensive rules whose legality has been struck down by a federal appeals court.

The other two rules change the definitions and technical standards for Class II games like bingo. Tribes have overwhelmingly opposed the proposal, saying it would make their electronic machines illegal.

Both proposals have been under development for more than two years. But they will get a fresh look from the newest member of NIGC, Norm DesRosiers, a tribal gaming commissioner from California who has been appointed to the panel.

DesRosiers will join the NIGC in January, following the close of a 30-day comment period that was announced last week. Tribes have welcomed his addition to the panel, which has been working with just two out of three members for nearly a year.

Every federal agency is required to publish semiannual agendas of its regulatory activities under the Regulatory Flexibility Act and Executive Order 12866. The updates are published twice a year.

NIGC Update:
Semiannual Regulatory Agenda (December 11, 2006)

Relevant Links:
National Indian Gaming Commission - http://www.nigc.gov
Unified Agendas - http://www.gpoaccess.gov/ua/browse.html

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