On October 23rd an article in the Becker Hospital Review reported on a casino-themed, charity fund raiser called the Founder’s Ball held in Brooklyn, New York. The event was attended by 850 people and raised $1.5 million for the hospital. The attendees wore formal attire and played blackjack, roulette, craps, poker and slot machines. The event is not really news, except in an historical context; little gatherings like this Founder’s Ball were part of a major change in the gaming industry and economic conditions on Indian reservations everywhere.
Thirty years ago, charity casino nights helped open the door for a huge new branch of the gaming industry. In the 1980s, the Cabazon Band of Mission Indians in Southern California operated a small bingo game and poker club. The State of California maintained the operation was illegal, as gambling was illegal within its borders; California sued the tribe. The case, California v. Cabazon Band of Mission Indians, was heard by the California Supreme Court in 1987. In hearing the case, the high court said that if gambling were illegal in California, then in would be illegal on tribal land. However, if gambling was “allowed to any person for any purpose,” then the tribes could operate gaming as they saw fit. The court found some forms of gambling were permitted in California. The California State Lottery, poker clubs, church bingo and charity casino nights were all being conducted in the state. California panicked and rushed to Washington; D. C. to plead its case. California was joined by other states with significant Indian populations. Florida, New York, Wisconsin, Michigan and other states had tribes that also operated bingo and poker games; those states sensed a loss of jurisdiction and control.
In October 1988, the Indian Gaming Regulatory Act (IGRA) was passed by Congress and signed by President Ronald Reagan. This act was an attempt to give states control over gambling on Indian lands after the Cabazon decision had seemingly given tribes carte blanche on gaming. Congress, as one might expect, turned a sympathetic ear toward the states. Existing federal law recognized tribes as being sovereign nations and required states to recognize that sovereignty in some instances. Fishing and land use were issues where tribes often challenged state jurisdiction. However, the potential impact of tribal control over fishing or land use was tiny compared to that of full-blown casino gambling without state jurisdiction. IGRA codified a state’s right to be involved in the process. The act required the state and tribe to agree on the conditions under which gaming could be conducted in a formal compact. Under federal law, tribes cannot be taxed by a state due to their sovereign status, nor can a state directly regulate gaming. However in the compact negotiations, states could and did insist on a regulatory procedure that they could monitor as part of the tribal-state compact. In the compacting process, most states asked for indirect payments as compensation for the services provided to tribal casinos. Some states also negotiated an exclusivity fee to replace taxation. The fees were to protect the tribal operation from future competition. No one was really satisfied by the compacts, but the compromises were acceptable.
That was thirty years ago. Today 242 tribes are operating 494 casinos in 28 states; in 2017 those tribal casinos generated $32.4 billion in casino revenue, up 3.9 percent from the previous year. By way of comparison, non-Indian casinos and VLTs in 23 states generated $41.1 billion, up 3.7 percent from 2016. In just thirty years Indian gaming has gone from bingo games in school gymnasiums and black jack in a garage to a thriving industry equal to the rest of the commercial gaming in the country. However, regardless of how successful Indian casinos have become, that is only part of the story. The real story is the impact that gaming revenues have had on tribes. Those revenues have allowed tribes to build houses, medical facilities, pay college tuition, subsidize senior citizens’ income and many other social services. However, Indian gaming is not without its critics.
In the last thirty years, there have been many articles written about the ways that “gambling” money is misspent, embezzled and just plain wasted. In each case there was probably some truth in the accusations, but those are the minor events in the overall picture. More important are actions of the Oneida Nation in New York and Wisconsin, the Seminole in Florida, the Choctaw in Mississippi, the Chickasaw in Texas, the Tulalip in Washington and indeed the Cabazon in California. Those tribes and many others like them have used the money gained from casino gambling to improve life for tribal members, strengthen their culture and diversify their business interests away from gaming, seeking to secure a future for the tribe and its members.
While Indian gaming has been really good for tribes, it has not always been as kind to other forms of gaming. Particularly in Northern Nevada many casinos have closed as a result of Indian gaming. In the early 1980s a bustling, successful Comstock Hotel-Casino in Reno sent dealers, cards, gaming tables and chairs to charity events in Northern California. Whenever one of its customers asked the Comstock complied; after all it was good marketing. The Comstock has been closed for 18 years. Indian gaming in California, Oregon and Washington absorbed its customers. In its own way, the Comstock helped Indian gaming get started by helping charities give parties. It is an oversimplification to say charity events like the Founder’s Ball in Brooklyn lead to Indian gaming. However, all of those balls held in California played a part and contributed to the state of Indian gaming today. IGRA is probably the most significant piece of federal Indian legislation since the Indian Reorganization Act of 1934. And its anniversary is a cause to celebrate, to hold a Founder’s Ball and dance the night away; if you are one of the beneficiaries.
