Myth: The Indian Gaming Regulatory Act (IGRA) created Indian gaming
Fact: Gaming is a right of Indian nations
While Europeans brought new games to America, Indian gaming existed long before Europeans settled in America. Large-scale Indian gaming, mainly bingo, predated IGRA by about 10 years. In 1987, the U.S. Supreme Court recognized Indian gaming rights when it ruled states had no authority to regulate gaming on Indian land, if such gaming was permitted outside the reservation for any other purpose (California v. Cabazon). Congress established the legal basis for this right when it passed IGRA in 1988.
Myth: Indian gaming is commercial, for-profit gaming
Fact: Gaming on Indian reservations is operated by tribes to fund governmental programs
IGRA requires all tribal gaming revenues be used solely for governmental or charitable purposes. Just as state governments decide the fate of funds from over 40 state-run lotteries, tribal governments determine how gaming proceeds are spent. In direct contrast to the opulent expenditures of commercial casino operators such as Donald Trump, Indian tribes use gaming revenues to build houses, schools, roads, sewer and water systems; to fund the health care and education of their people; and to develop a strong, diverse future economic base.
Myth: Tribal gaming is an unregulated magnet for organized crime
Fact: Indian gaming is more heavily regulated and more secure than commercial gaming
Tribal governments safeguard projects they rely upon for food, clothing and education. Prior to the IGRA’s federal gaming regulation framework, tribes self-regulated gaming using inherent police powers. Existing tribal law enforcement and court systems have been in place for years. Tribal-state compacts ensure law enforcement and security measures are considered.
On the federal level, the Department of Justice, FBI, and Bureau of Indian Affairs oversee crimes committed on Indian reservations. The IGRA established the National Indian Gaming Commission to regulate Indian Gaming in February 1993.
In October 1993, during testimony before the U.S. House of Representatives, FBI organized crime section chief Jim Mooney said there was “no information to support claims” organized crime has infiltrated Indian gaming. “We’ve heard more rumors and innuendoes than we’ve been able to prove.”
Myth: Indians do not pay taxes
Fact: Indians pay all taxes required by state and federal law
All Indian people pay federal income, FICA, and social security taxes. Most Indians also pay state income and property taxes. Only the small percentage of Indians living and working on federally recognized reservations, not unlike soldiers and their families living on military installations, are exempt from paying state income and property taxes. However, taxes such as sales tax and federal income tax are still paid.
Indian tribes are governments with responsibilities to their citizens, but tribes usually lack a tax base to support their governmental needs. Some tribes have found in gaming a means to not only provide jobs and economic activity on their reservations, but also a source of badly needed government revenue. Just as states do not pay taxes on resources derived from gaming, neither do tribes.
Myth: The IGRA is ineffective
Fact: Indian gaming is providing substantial economic benefit to states where IGRA is given proper opportunity
IGRA is working to the benefit of Indians and non-Indians in several states, including Minnesota, Wisconsin, Michigan, Connecticut and Kansas. Reservations are slowly recovering from decades of failed government programs, rebuilding houses, community centers, and roads. Indians and non-Indians are proudly replacing welfare rolls with payrolls. Local and state governments are enjoying increased tax revenues. Only in those states failing to negotiate “good faith” compacts, in violation of IGRA, has the process not worked.
Myth: IGRA is an unconstitutional infringement upon state rights
Fact: States have withdrawn from an agreement they proposed and accepted
The states’ ongoing assault on IGRA rests on the false premise states possess inherent rights to regulate tribal gaming. States initially proposed and accepted the IGRA, passed by Congress in 1988, but now assert the IGRA violates the 10th and 11th Amendments to the U.S. Constitution. To the contrary, the Supreme Court’s Cabazon decision was a clear recognition of the right of Indian tribes to regulate gaming on their lands free of state laws if the state permitted those activities outside the reservation.
Myth: Tribal gaming drains resources and tax dollars from surrounding non-Indian governments and communities
Fact: Indian gaming creates additional resources and tax dollars for surrounding non-Indian governments and communities
Indian gaming is now a $5 billion industry according to Gaming & Wagering Magazine. Indian gaming creates jobs, increases economic activity and generates tax revenue both on and off the reservation. In San Diego County, California alone, tribal gaming has been responsible for the creation of more than 5,000 well-paying new jobs, with a payroll of $22 million per year. Tribes have spent millions of dollars for construction, and spend much more locally for goods and services.
Myth: Gaming is not the best tribal economic development alternative
Fact: Indian gaming is the only economic development tool to have ever worked on reservations
Many reservations are located on remote, undesirable land. Prior to the introduction of tribal gaming, reservations had witnessed minimal public or private-sector economic development. The Bureau of Indian Affairs has proved unsuccessful in implementing successful economic reservation development, and states have failed to propose credible alternatives to Indian gaming for tribal revenues and jobs. Tribal governments are using gaming proceeds to diversify and conduct other economic enterprises.
Myth: Tribal gaming has little public support among non-Indians
Fact: A majority of Americans support Indian gaming
Public opinion surveys, both nationally and within various tribes, conclusively demonstrate strong public support for expanding Indian reservation gaming. A national Harris Poll in October 1992, and polls in Arizona, California, Kansas, Minnesota, New Mexico, Nebraska and Washington, all show the general public favors casino-style gambling on Indian lands, while opposing non-Indian gaming expansion. Indian gaming is supported by voters because revenues help tribes and surrounding communities become economically self-sufficient.
Note: While federal and state governments rely on taxes to generate program funding, American Indian governments must rely on their business acumen. Whereas the federal government can operate with a deficit budget, Indian tribes must carefully manage all resources assuming sound financial operation. Tribal governments do not tax their citizens or the businesses located on reservation lands. Alternate economic programs have been created to fund tribal business/government operations. Gaming is only one vehicle used to generate revenue for funding tribal government operations and responsibilities, such as: health and welfare, education, fire and law enforcement, cultural programs and child care facilities.
“Each tribe is trying to improve the economic status of its own citizens — just like states. If the state of Michigan generates extra money from its lottery, the federal government doesn’t take money away from Michigan in order to give it to Mississippi,” said Ron Allen, president, National Congress of Indians, in response to the comment: “The federal government should make rich tribes share their wealth with poorer ones.”