had in getting the States to negotiate. Without amending IGRA, are there any other ways that you think we could resolve the impasses that we have between tribes and States? Obviously, if we tried to amend IGRA, the States may oppose any changes that would take away their ability to do what they have already won in Court.

Mr. HOGEN. Secretary Norton has been working with the Santee Sioux Tribe in Nebraska and with the Seminole Tribe in Florida with respect to trying to come up with a compact. That is a long tedious process, but progress is being made. I know that based on the conversations we have recently had. I was over there when that process was ongoing.

If and when that process gets finished and we have a model to work from, then I think that will be addressed in large part. But it will perhaps take longer than an amendment to IGRA might take.

The CHAIRMAN. We probably will not be able to amend IGRA if it looks like a threat to the States. We just would not get the thing through.

I understand that some of the new regulations that you are developing have to do with environmental health and safety regulations. I think I can understand safety, but what kind of regulations are you developing that have to do with environmental health in a casino?

Mr. HOGEN. If a casino were proposed to be built on a fragile river bank and it would crash into the river or pollute the river, we would probably say, "Hey, take another look at this."

The CHAIRMAN. I see.

Mr. HOGEN. We have issued some regulations that are basically advisory. There is some term of art that I cannot think of right now that we call that. But basically what we say is:

We are not setting the rules of what you have to do for environment. But you do have to look at this. You have to make your own plan. Go by your own tribal code, or whatever.

If and when we find a situation where there is imminent danger, we can take action. We have never had to do this.

The CHAIRMAN. Do you not have the legal authority or experts on your staff to deal with safety regulations, like OSHA does, or like EPA does with environmental health; do you?

Mr. HOGEN. We do not have safety experts, so to speak. With respect to environmental issues, when we review and approve management contracts, that is a major Federal action that triggers NEPA. An environmental assessment may have to be made. We have to look intelligently at that.

The CHAIRMAN. You work with these other agencies when you have to make that assessment or decision?

Mr. HOGEN. We do that. We work with the folks in Bureau of Indian Affairs and the Department of the Interior. Of course, we also want to be sure we understand what they are telling us. We have some of that experience in-house.

The CHAIRMAN. Thank you. I have no further questions. Senator Inouye or other members may have questions. If they do, they will probably submit them in writing. I would appreciate it if you could get answers back to the committee.

Mr. HOGEN. I would be very happy to do that. Thank you for this opportunity.

The CHAIRMAN. While our panel is coming to the table, we will stand in recess for just a couple of minutes.

[Recess.]

The CHAIRMAN. The committee will come back to order.

Our next panel will be Ernest L. Stevens, Jr., chairman, National Indian Gaming Association, Washington, DC. He is accompanied by Mark Van Norman, executive director, National Indian Gaming Association, Washington, DC, and Norm DeRosier, Viejas Gaming Commission.

If your colleagues are going to speak, please have them identify their names for the record. As with the other witness, if you would like to turn your complete written testimony in, that will be fine. You can abbreviate it, if you would like to.

STATEMENT OF ERNEST L. STEVENS, JR., CHAIRMAN, NATIONAL INDIAN GAMING ASSOCIATION, WASHINGTON, DC, ACCOMPANIED BY MARK VAN NORMAN, EXECUTIVE DIRECTOR, NATIONAL INDIAN GAMING ASSOCIATION, WASHINGTON, DC; AND NORM DEROSIER, VIEJAS GAMING COMMISSION

Mr. STEVENS. Thank you, Mr. Chairman.

Good morning, Senator. Thank you for allowing me to be here today. I will summarize my statement. I would ask that my statement be included in the record in its entirety.

The CHAIRMAN. Without objection, so ordered.

[Prepared statement of Mr. Stevens appears in appendix.]

Mr. STEVENS. With me today are Mark Van Norman. He is a member of the Cheyenne River Sioux Indian Tribe. He is NIGA's executive director. Also here is Norm DeRosier, a gaming commissioner from the Viejas band of Kumeyaay Indians.

I am an Oneida from Wisconsin. I serve as the chairman of the National Indian Gaming Association. I want to say, Senator, that I am honored to be here to share this information with you on the regulation of Indian gaming, and to discuss the role of funding at NIGC.

As you know, Senator, tribes have survived a history of genocide, oppression, and dispossession. In the early 1970's we were number one in everything that was bad-unemployment, poverty, dropout rates, and substandard health care. At that time, a number of tribes began to turn to gaming as a way out. Tribal governments use gaming like States use lotteries, to build infrastructure and provide essential services for their citizens. We believe that is working.

In just 30 years, Indian gaming has helped tribes to begin to rebuild communities that were all but forgotten. Where once there was poverty and unemployment, Indian gaming provides more than 300,000 American jobs. Where once tribes suffered disease and lack of health care, Indian gaming helps to build clinics, and provides health care to the sick and to the elderly.

Where once tribes faced epidemic suicide and dropout rates, Indian gaming builds schools, funds scholarship programs, and provides hope for the entire generation of our Indian youth. Indian

gaming is all of this and a lot more. Our tribal governments are stronger and our people are stronger.

Indian country still has a long way to go. Too many of our people continue to live in disease and poverty, but Indian gaming offers hope for a better future for our tribal communities.

The great irony now is that Indian tribes are helping non-Indian communities as well. We are very proud of that, sir. We provide jobs for non-Indians nationwide. In fact, you may not know this, but over 75 percent of the 300,000 Indian gaming jobs go to nonIndians.

The CHAIRMAN. 75 percent?

Mr. STEVENS. 75 percent of over 300,000 jobs go to non-Indians. We have to work together. In spite of our history, we move forward without any issues. We have tremendous working arrangements with the municipalities. We have a common bridge because most of the people that live and work in the communities around us are working and are interacting in our facilities.

So we walk together hand-in-hand. Again, I will not go into long detail about how these initiatives in Indian Country have assisted the welfare-to-work initiatives that have been so common nationwide, but assisting them with well-paid jobs with good benefits such as health care and a lot of times even child care.

We are real proud of how we walk together with our neighbors in our surrounding municipalities. We get a lot of isolated stories out there in different regions because there is so much going on. But the majority of us have great stories to tell in Indian country. Tribes also add to the Federal, State, and local revenues. Let me also add the "T" word up front. Indians pay taxes. People who work at Indian casinos and those who do business with Indian casinos, and those who get paid by and win in any casinos, pay Federal income taxes. They pay taxes just like the folks who work at the State lotteries.

As employers, tribes pay taxes to fund Social Security and participate as government's in the Federal unemployment system. Economists estimate that Indian gaming provides Federal, State, and local governments with more than $6 billion in increased income sales and other taxes and revenues. That is $6 billion in Federal, State, and local revenue.

We realize that the benefits of Indian gaming would not be possible without good regulation. Successful operations require solid regulation. Tribal governments understand and abide by this principle, and gaming has been the best opportunity in 200 years to bring us out of poverty. Without question, tribes are committed to regulation.

Working in cooperation with tribal, State, and Federal Governments all play in a role in regulation of Indian gaming. This system is costly. It is comprehensive. It is working. We are very proud of it, Senator.

Is our regulatory system different from other gaming operations? You bet it is. No Federal commission oversees the State lotteries, horse and dog track wagers, jai alai, or commercial river boat gaming industries. But Federal oversight of Indian gaming is extensive. Anyone who commits a crime against Indian gaming facility has

committed a Federal offense. They have, and they will continue to go to jail.

If you want to visualize the structure of Indian gaming regulations, it is like a wedding cake. The bottom layer, or tribal regulation, is the primary and the largest with the most resources and the most manpower. The second layer is State regulators which come in through the tribal-State compact process. They provide help with background checks, investigation, and oversight. Of course, the top layer is NIGC and other Federal agencies that work in Indian gaming. In addition to the NIGC is the FBI, the Department of Justice, Treasury, the Interior Department, and everybody's favorite, the IRS.

Any way you slice the cake, you are going to get a regulator. Sometimes that can be cumbersome, but we would rather be cumbersome and thorough than have any of these issues. That is why we get so much back-up out there that says, "Indian gaming is strongly regulated." That is because we have so many checks and balances in this system. We are very proud of that.

In total, tribes invest over $212 million annually for the regulation of Indian gaming. That includes $164 million for tribal gaming regulation. Over $40 million is for reimbursement of State regulatory agencies for their support, and $8 million is to fund the National Indian Gaming Commission.

In addition, the Commission collects another million dollars for processing fingerprints and background checks for a $9-million budget. Under IGRA, Congress intended for three sovereigns to work in cooperation on the regulation of Indian gaming. Each regulatory body has a distinct and supportive role for the three different classes of Indian gaming. The idea was to avoid duplication, but provide comprehensive oversight.

Through IGRA, Congress made it clear that tribal regulatory agencies are the primary regulators of Indian gaming. Indian country takes that role very seriously, Senator. As the primary regulators, tribal regulatory agencies have the largest budget for Indian gaming regulation. Tribes spend over $164 million annually on self regulation. Our system includes over 2,800 tribal gaming commissioners and regulatory personnel.

In addition to employing top-notch personnel, tribes use state-ofthe-art regulatory surveillance and security equipment to support the regulatory operations. We are very excited in this day and time when we have facial recognition. We have cameras that can look underground and tell you whether a penny is heads up or tails. We really have some outstanding technology out there. We are proud of that. We are upgrading it every day. Everything that becomes available, Indian tribes are working together to establish the best. State regulatory agencies assist tribal agencies with background checks, licensing inspections, and review of class III Indian gaming operations. Tribes reimburse States over $40 million annually for those regulatory services.

At the Federal level, the NIGC shares the responsibility for regulation with other government agencies. The NIGC defers to State gaming agencies on background checks, licensing decisions, and compact enforcement for class III gaming regulation. NIGC works in partnership with tribal gaming regulatory agencies on class II

gaming regulation, and provides background oversight for class III gaming regulation.

NIGC also acts as a facilitator to help build strong relationship between the three sovereigns to further strengthen Indian gaming regulation. In fact, a couple of months ago, NIGC hosted a meeting to discuss the formation of a national Indian gaming intelligence network to share information and to provide technical assistance to tribal regulators nationwide.

Participants included the chairman of Attorney General Ashcroft's Native American Issues Subcommittee, officials from the FBI, Treasury's Financial Crimes Enforcement net worth, North Dakota's attorney general, the NIGC, and tribal gaming regulators throughout the country.

As I stated above, the systems of checks and balances in a cooperative regulation has proven effective. Much of the credit for the success in regulation should go to tribal governments and the tribal leaders who recognize the need for solid regulation, and who took the initiative to provide the funding.

Against the backdrop of comprehensive regulation, the FBI and the U.S. Justice Department have testified repeatedly that there has been no substantial infiltration of organized crime on Indian gaming. In fact, the last time the chief of the Department of Justice's Organized Crime Division testified before this committee, he stated that, and I quote:

Indian gaming has proven to be a useful economic development tool for a number of tribes who have utilized gaming revenues to support a variety of essential services.

While there has been isolated occasions when a crime has occurred at Indian gaming facilities, the Department of Justice found that coordination between tribal, State, and Federal regulators and law enforcement ensure that offenders are caught, prosecuted, and punished. Indian gaming has a good track record because tribes hire the most highly qualified people from tribal, State, and Federal law enforcement regulatory agencies.

Again, tribes spend $212 million on regulation each year. That is a lot of money that could go to fund sorely needed programs. But tribes realize that regulation is the cost of a successful operation and it is needed to protect our resources.

I would like to take a moment to recognize our tribal regulator that makes gaming work. Mr. DeRosier has 9 years of service in State law enforcement prior to his 11 years of service in tribal regulation. He also serves as the chairman of the National Tribal Gaming Commission and Regulatory Association that worked actively throughout Indian country.

Finally, that brings me to the issue of funding for the NIGC. NIGC and our member tribes hold the NIGC and its Commissioners in high regard. The current Commissioners have outstanding credentials and complement each other. I just want to make it clear, Senator, we do not always agree on everything, but we know that we have a mutual job to do. It is just as I stated. The tribal leaders trust us to protect this operation. All of this country count on us. If you could select the best three people to do that job, and if I had my choice, I would select the ones that have been selected to do this job. We do not always agree, but you have three out