When you’re at a conference sponsored by the National Indian Gaming Association, it would be difficult to imagine that they wouldn’t have a conference panel on Class II (C2) gaming. Based on bingo, these machines, along with the traditional paper and dauber game, were the foundation of the Native American gaming. Virtually every tribe with a mega resort today got their humble beginning with bingo and C2 games. In fact, the success of these early products led to the first disputes between states and tribes. Fortunately, when the legality of Indian bingo hit the Supreme Court in the landmark California V. Cabazon Band of Mission Indians case, the tribe prevailed. That decision led Congress to enact IGRA (the Indian Gaming Regulatory Act) in 1988, which led directly to today’s $30B industry.
Class 2, however, has had an up and down history. Originally, states like Oklahoma would only allow tribes to have C2 games. When their compacts changed in 2005 to allow Class 3 (C3) products, Jamie Hummingbird, director of the Cherokee Nation Gaming Commission, said, “Our C2 mix got as low as 30%. Now they are coming back with better themes and titles.” He said they have since grown to 42% of their floor and are getting stronger every year. “They are side by side with C3. They perform as well as C3 but have a 6% advantage because they’re untaxed.”
There are several reasons for the improvements. One was the National Indian Gaming Commission’s (NIGC) revision of the technical standards, first in 2008 and again in 2012. Dan Little, now Aristocrat’s VP of Government Relations, was on the Commission during the last revision and said, “In 2008, we were coming off a very controversial time. Many tribes were opposed to the old standards, but with the first revisions, there was some overreach. We revised them in 2012 to better reflect where the industry was going. We also established the authority that the NIGC would have, or not have, more importantly. (We) had to look at IGRA for this. Our revisions, which brought C3 and C2 regulations much closer in line, gave the industry a lot more confidence. That led to manufacturers investing millions of dollars in the development of new products today.”
All the panelists agreed on the point that today’s C2 games can equal or exceed the performance of a C3 game. Glenn Smithson, the GM of 7 Cedars Casino Resort in Sequim, Washington, noted, “Bet limits in many states can be higher with C2; they are restricted on C3 games in our state. We even had a million-dollar winner on one of these C2 games.” That’s true in several other states, as well, such as Arizona, where there is a $29 betting limit on C3 but no such restriction on C2 products.
Doyle Smotherman, director of slot operations at California’s Colusa Casino, echoed the idea that there’s been vast improvement in C2 games, saying, “… older systems had a huge bingo card on screen, required multiple touches to win, and the game play was not good. There was a lukewarm reception by our guests. Today, it’s totally different. Now Class II is competing well with Class III, and these games warrant prime locations on our floor.”
The capacity audience at this session agreed when polled that not only has Class 2 had a strong resurgence in the last few years, but that these machines were the economic engines that allowed tribes across the country to not only prosper, but also to make major contributions to the growth and well-being of their respective communities.
