of Congress to visit Indian country in their State or nearby State to witness first hand how Indian gaming is rebuilding these once forgotten communities. Indian country still has a long way to go - too many of our people continue to live with disease and poverty - but Indian gaming offers hope for a better future for tribal communities. C. Indian Gaming Benefits Other Non-Gaming Tribes and Non-Indian Tribal governments are also building relationships with non-gaming Tribes, State governments, and local government and community neighbors. For example, the Forest County Potawatomi Tribe funds the Milwaukee Indian School for all Indian students and provides assistance to the remote Red Cliff and Mole Lake Bands of Chippewa. The San Manuel Band outside San Diego financed a new wing for the local hospital. Agua Caliente purchased fire trucks for the City of Palm Springs. The Mohegan Tribe in Connecticut is developing a new water delivery system that will benefit several surrounding communities as well as the Tribe. The great irony now is that Indian Tribes are helping non-Indian communities. A 2001 Harvard University study indicates that Indian gaming has a destination effect on surrounding business that boosts economic activity for others in the vicinity." I've often seen visual evidence of this effect when I drive to rural locations like the Tunica-Biloxi Tribe's casino, which is several hours drive from New Orleans. For miles before you get to the casino, there is little development but as you approach, you see an oasis of business and economic activity flourishing in the area. This economic development is generated by Indian gaming in rural areas where other forms of economic development have failed to take hold as well as suburban areas that were in the throes of lay-offs. Indian gaming operations provide jobs for non-Indians nationwide. Of the 300,000 jobs created by Indian gaming, about three-fourths are held by non-Indians. Indian gaming helps State and local communities recover lost jobs where companies are forced to leave. For example, when Electric Boat Manufacturing closed down in Groton, Connecticut, the area lost 12,000 jobs. Fortunately, around this same time, the Mashantucket Pequot Tribe created 14,000 new jobs through its Foxwoods Resort. Another example is the air force based that closed outside of Rome, New York. The area lost 2,500 jobs, but thankfully, the Oneida Nation created 3,000 new jobs in the area with its Turning Stone Casino. Indian gaming also creates substantial revenue streams for Federal, State and local units of government. In 2003 alone, Indian gaming will generate approximately $6 billion in added revenue to Federal, State, and local governments. Contrary to a popular misconception, Indians pay taxes. People who work at casinos, those who do business with casinos, and those who get paid by casinos pay taxes, just like the folks who work at Harvard Project on American Indian Economic Development, Public Policy Analysis of Indian Gaming in Massachusetts, 10 (May 13, 2002). state lotteries. As employers, Tribes also pay employment taxes to fund social security and also participate as governments in the federal unemployment system. Indian gaming generates revenue for the United States federal government in the form of income taxes this includes taxes paid by tribal citizens for per capita payments received from tribal governments. At the State level, Indian gaming generates revenue through payroll and income taxes, reduced welfare and unemployment payments, and revenue sharing and other agreements. Tribes realize that the benefits of gaming wouldn't be possible without good regulation. Solid regulation is the cost of a successful operation. Tribal governments understand and abide by this principle. For many Tribes gaming has been the best opportunity in 200 years to attain economic self-sufficiency. Tribes are unwilling to sacrifice this opportunity because of something as necessary as sufficient regulation. Working in cooperation - Tribal, State, and Federal governments all play a role in the regulation of Indian gaming. While the system is costly - it is comprehensive, it's professional, and it's working to maintain the integrity of Indian gaming. While no federal commission oversees the operations of State lotteries, horse or dog track wagering, jai alai, or the commercial and riverboat gaming industries, the federal oversight of Indian gaming is extensive. The NIGC is the central regulator on the federal level. In addition, Tribes work with the BIA within the Interior Department, the Financial Crimes Enforcement Network (Fin CEN) and the Internal Revenue Service (IRS) within the Department of the Treasury, and the Federal Bureau of Investigation (FBI) within the Department of Justice. Unlike other forms of gaming, crimes committed in Indian country are subject to federal penalties. Under the United States Criminal Code, anyone who embezzles or steals money or property from an Indian gaming facility or any other Indian establishment is guilty of a federal felony, punishable by up to 5 years in prison. This law applies to management, employees, and patrons. See 18 U.S.C. § 1163 (5 year penalty for any theft from an Indian facility); 18 U.S.C. §§ 1166-1167 (Federal offense to violate laws applicable to Indian gaming facilities). Tribes also comply with the Money Laundering Suppression Act, which applies the Bank Secrecy Act's protective provisions to Indian gaming operations. Under the Act, tribal operations report currency transactions in excess of $10,000 to Fin CEN. 31 U.S.C. §§ 5311 et seq. Federal involvement in Indian gaming regulation continues to grow. Under the USA - Patriot Act, enacted in response to the terrorist attacks of September 11, 2001, Congress strengthened money-laundering prevention laws to curb the possible funding of terrorist activities. Under the Act, gaming establishments, including Indian gaming facilities, must develop systems to report suspected terrorists and suspicious activities involving cash or credit transactions. As a result, tribal gaming operations are developing internal controls to assure ongoing compliance with these new requirements. In total, Indian tribes invest over $212 million annually for the regulation of Indian gaming. That includes over $164 million for tribal gaming regulation, over $40 million to reimburse the state regulatory agencies for their support, and $8 million to fund the Nation Indian Gaming Commission. Under IGRA - Congress intended for the three sovereigns to work in cooperation on the regulation of Indian gaming. Each regulatory body has a distinct and supporting role for the three different classes of Indian gaming. The idea was to avoid duplication but provide comprehensive oversight. Through IGRA - Congress made clear that tribal regulatory agencies are the primary regulators of Indian gaming. As the NIGC explains: Tribes are the primary, day-to-day regulators of [Indian gaming] Tribes have exclusive authority over class I gaming, share class II regulatory responsibility with the NIGC, and share class III regulatory responsibility with the States. As the primary regulators, tribal regulatory agencies have the largest budget for Indian gaming regulation. Tribes spend over $164 million annually on self-regulation. Tribal regulatory systems include over 2800 tribal gaming commissioners and regulatory personnel. These regulators are well-qualified, and have backgrounds as federal, tribal, and state law enforcement officials, commercial gaming regulators from New Jersey and Neveda. This is more regulators than Nevada, New Jersey, and Riverboat gaming combined. In addition to employing well-qualified personnel, Tribes use state-of-the-art regulatory, surveillance, and security equipment to support their regulatory operations. Our operations are the newest - and use the most up to date technology. 6 IGRA requires tribal governments to enact tribal gaming regulatory ordinances that meet Federal statutory requirements, including the following: Generally, Indian Tribes must have the sole proprietary interest and responsibility for the conduct of gaming; 6 Patrick Lambert, the Executive Director of the Eastern Band of Cherokee's Tribal Gaming Commission, who is a tribal member, attorney, a Faculty Member of the National Judicial College, Reno, Nevada, and served on the NIGC's Minimum Internal Standards Advisory Committee to comment on Indian gaming regulation. Director Lambert explains: Indian gaming has presented an unprecedented opportunity in the history of our Tribe to Net revenue must be used for tribal government purposes, economic development, general tribal welfare, charity, and payments to local governments; Annual independent audits must be conducted and provided to NIGC; • Independent audits must be conducted for all contracts for supplies and services in excess of $25,000 (except legal and accounting contracts); Provisions for protection of the environment, public health, and safety, and Systems for background checks and licensing of primary management and key tribal gaming employees, with background checks reported to NIGC. The Chairman of the NIGC ensures that tribal gaming regulatory ordinances meet the statutory requisites through a Federal review and approval process. Typically, tribal ordinances establish tribal gaming regulatory agencies to carry out these duties. Accordingly, as the primary regulators of Indian gaming, tribal gaming regulatory agencies carry out the following types of functions: Conduct background investigations on primary management officials and key tribal gaming employees in accordance with IGRA and NIGC regulations and forward them for NIGC or state review; Issue, deny, review, suspend, or revoke tribal gaming licenses for management officials and key tribal gaming employees, in cooperation with state regulatory agencies and the NIGC, 25 C.F.R. Parts 556 and 558; Conduct background investigations of vendors; · Issue, deny, review, suspend, or revoke tribal gaming licenses for vendors, often in cooperation with state regulatory agencies; Issue, deny, suspend, or revoke licenses for each Indian gaming facility under the jurisdiction of the Indian Tribe and ensure that each Indian gaming facility is built, maintained, and operated in a manner that protects the environment, public health, and safety, 25 C.F.R. § 522.4; Promulgate tribal gaming regulations in accordance with tribal and Federal law Establish minimum standards for the operation of the Indian gaming facility, • Continuously monitor Indian gaming operations to ensure compliance with tribal and Federal law and Tribal-State compact requirements for class III gaming; Oversee audits of the Indian gaming facility, including audits of contract and supply contracts; Conduct investigations of any alleged misconduct, take appropriate enforcement action, and make appropriate referrals to tribal, state, and federal law enforcement agencies; Conduct hearings, take testimony, take disciplinary actions, levy fines, and issue closure orders and resolve patron disputes; • Work cooperatively with state regulatory agencies, the NIGC, and tribal, state, and Federal law enforcement agencies; and • Report to the governing body of the Indian Tribe. Tribal gaming regulatory agencies are well staffed, with highly qualified employees who work in close cooperation with their Federal and state counterparts. For example, the Mohegan Tribal Gaming Commission ("MTGC”) is a strong, effective regulatory agency directed by John Meskill, former Executive Director of the State of Connecticut Division of Special Revenue. MTGC, as the primary regulator of the Mohegan Sun Casino, is one of the largest regulatory agencies in the Nation. MTGC has a staff of 61, including 46 inspectors, 7 investigators, a staff auditor (CPA), and 2 administration staff. MTGC's annual budget is $3.3 million. Management officials, key tribal gaming employees, and all vendors, gaming and non-gaming, must be licensed to do business with Mohegan Sun. In accordance with Mohegan's Tribal-State compact, the State Division of Special Revenue licenses vendors for MTGC. Gaming vendors, such as card, dice, table game, and slot machine manufacturers and bonus prize providers, are investigated by the State Police and licensed by the State's Division of Special Revenue. For FY 2003, the Mohegan Tribe will reimburse the State $1.228 million for costs incurred by State regulators and $2.275 million for State police background investigations and law enforcement services on site. Chairman Rudy Wambsgans, Tunica-Biloxi Tribe Gaming Commission, is a member of the Tribe and a 20-year veteran of the U.S. Military, with service in the Navy, National Guard, and Coast Guard and law enforcement training from the FBI Academy and the University of Nevada. Chairman Wambsgans explains: It is our goal to provide the most qualified staff and service to Paragon In addition to appointed qualified gaming commissioners, hiring experienced regulatory staff, and investing heavily in tribal regulatory budgets, Indian Tribes use state-of-the-art regulatory, surveillance, and security equipment to support their regulatory operations. We asked for a comment on this issue from Brad Roache, Corporate Director of Security and Surveillance, for the Mille Lacs Band of Ojibwe. Roache is a Minneapolis Police Force veteran, with 24 years service on the SWAT Team and emergency response, homicide, robbery, and repeat offender units. Director Roache explains: Security and surveillance have a very important role in the Mille Lacs |