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When U.S. President Ronald Reagan signed the Indian Gaming Regulatory Act (IGRA) on October 17, 1988, the federal government once again violated the sovereignty of Native American tribes even as it set tribal gaming on the path to a $40bn market.
After all, the U.S. Supreme Court — in a landmark decision just one year earlier — effectively overturned existing case law permitting gambling on Indian reservations.
The 6-3 decision in California v Cabazon Band of Mission Indians alarmed and galvanized the commercial gambling industry, particularly in Nevada.
A coalition of lobbyists and lawmakers in Washington, D.C. managed to persuade a usually dysfunctional Congress to pass IGRA in what would turn out to be a spectacularly counterproductive attempt to curtail future expansion of Indian gaming.
Thirty-five years later, Indian gaming has become arguably the biggest economic success story in Native American history.
Even after the Great Recession from 2007 to 2009, and the COVID-19 pandemic that began in 2020 and which still lingers to some degree, gross gaming revenue produced by 523 tribal gaming casinos across the U.S. last year reached $40.9bn.
“No less than a tribal governmental renaissance occurred, with tribes having the resources to fully fund governments,” said Kevin Washburn, dean of the University of Iowa College of Law.
Washburn, who served as assistant secretary for Indian affairs at the U.S. Department of the Interior from 2012 to 2016 and is a member of the Chickasaw Nation of Oklahoma, does not dispute that IGRA still infringes on tribal sovereignty.
“IGRA sort of clips the tribes’ wings in some ways in gaming by setting up a regulatory regime and setting clear limits,” Washburn told Vixio GamblingCompliance.
“That said, I think I have become a little bit more pleased that we have IGRA because it did reflect Congress’ very clear sanctioning of Indian gaming, and it’s better that it exists by virtue of a statute passed by Congress than merely from doctrine created by the Supreme Court.”
As a result of IGRA, tribes gained the financial means necessary to lobby Congress and participate in US democracy, Washburn said.
“Money talks in Washington, D.C. and it takes money to get your voice heard,” he said.
“Even poor tribes often benefit from the lobbying and activity in Washington that wealthy tribes can engage in.”
Looking ahead to the next 35 years, how Indian tribes will participate in the rapidly expanding digital gaming market stands as a threshold question.
The Seminole Tribe of Florida appears to be winning a landmark case that could open the online sports-betting market to tribes, not just in the Sunshine State, but across the nation.
This is because of provisions in a 2021 compact that authorize the Seminoles to accept wagers from across Florida under IGRA via servers located on tribal lands.
But Washburn is not convinced that IGRA permits internet gambling by tribes when the player placing the wager is not physically on Indian lands.
“The Seminole Tribe has done a fantastic job litigating that issue, but it is a challenging one for tribes to win,” said Washburn, who advised against internet betting by tribes through opinions he wrote in the early 2000s while serving as general counsel of the National Indian Gaming Commission.
“In general, the [U.S.] Justice Department has always taken the position that gambling occurs wherever the gambler is, and Indian gaming is lawful on Indian reservations [not beyond reservation borders].”
Even though the U.S. Circuit Court of Appeals in Washington, D.C. rejected a lawsuit seeking to nullify the Seminoles’ 2021 gambling compact with Florida, the ruling “didn’t say IGRA authorizes mobile sports betting,” Washburn said.
“This is an issue that’s bigger than Indian gaming,” he said.
Some tribes argue IGRA has become a fossil that needs to be amended for the digital era, but Washburn urges a more cautious approach.
“Wiser minds than mine have suggested that if you open up IGRA, you just never know what’s going to happen,” he said.
“Right now, that $40bn a year that’s coming in is pretty good and reliable, and I wouldn’t want to take any risks that might risk losing that revenue source.”
