Senate Committee on Indian Affairs Punts on Online Gambling

Posted By Steve Ruddock on July 24, 2014

On Wednesday, the US Senate Committee on Indian Affairs hosted an oversight hearing on Indian Gaming called: The Next 25 Years. But as one respondent on Twitter exclaimed, they should have called it “The Past 25 Years.”

What was billed as “A Committee oversight hearing on the state of Indian gaming,” the hearing turned out to be almost entirely focused on restricting new gaming development and a single piece of legislation HR 1410, the Keep Promise Act, which calls for the prohibition of Class II and Class III gambling in Phoenix, Arizona on land acquired after April 9, 2013.

When not speaking directly on HR 1410, the two hour hearing was little more than a chance for certain senators to make the case for tribes or Indian gaming in their jurisdictions, while the speakers spent most of the time doing likewise, either airing grievances or lobbying for this or that from the government.

There were plenty of mentions of the stagnation in Indian gaming revenue (one speaker cited the figures as $28 billion in 2013 and $27.9 Billion in 2012) while commercial gaming continues to grow.

Solutions like less regulation and making sure the tribes maintain their monopolies were mentioned, the most obvious solution, expansion into online gambling was never brought up, even in passing.

It’s not as if the speakers or a senator would be out of place bringing up online gambling, considering the current atmosphere, with the Santa Ysabel tribe in California threatening to upset the apple cart and launch an online poker site under the auspices of Class II Gambling.

In my opinion, the committee should have at least acknowledged this new challenge to the current status quo, as it could lead to a complete overhaul of the Indian Gaming Regulatory Act (IGRA) which is celebrating its 25th anniversary.

Instead we once again heard all of the old solutions such as licensing issues, commercial casinos encroaching on their territory, and tax burdens. There simply was no vision towards the future in a hearing that was billed as such, or at least towards a realistic future that will obviously include online gambling.

Instead it was more of the same, and the same concerns and solutions of the past 25 years appear to be following us into the next 25 years.

As one speaker, Anne-Marie Fennell, noted there are 420 tribal gaming establishments spread across the United States. But more casinos are not the answer, neither are other 1980’s solutions.

We are in 2014 and need solutions that reflect the current technological advances the world has seen. Yet all the talk was more of the same, as commercial casinos in Arizona and Montana were spoken of ad nauseam, with no mention of online gambling possibly offering a way to offset the stagnant revenues tribes are experiencing, or offsetting the new competition these casinos will provide.

Small tribes in remote places

Perhaps the most troubling part of Indian Gaming is how it favors certain tribes.

Roughly 43% of the nation’s Indian tribes are involved in gaming (not all successfully mind you), and it has brought in plenty of revenue for a number of these tribes. But what about the tribes in far-flung locations, or the tribes that simply don’t have the means to build casinos?

A. T. Stafne, the Chairman of the Assiniboine and Sioux Tribes of Fort Peck, basically made the case for online gambling without even realizing it, when he stated,

“Despite the success of some tribes, Indian gaming has provided little benefit to many tribes. Geographical location is a barrier for economic development of any kind, and certainly Indian gaming is not immune from geographical limitations.”

Online gambling would tear down these geographical barriers, and yet it was never mentioned. These tribes would have a chance to share in the gaming pie, or at the very least create some type of revenue sharing agreement with gaming tribes as is currently the case in California.

As important as I’m sure HR 1410 is, or Diane Feinstein’s S 477, there is an elephant in the room and nobody seems to want to acknowledge on the federal level. The point is, all tribes could potentially benefit from online gambling regardless of their location.

If tribes sit on the sidelines while online gambling proliferates it’s only going to make matters worse.

Stagnation may be the least of their problems if this comes to pass.

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For those of you interested, this is the composition of the Senate Committee on Indian Affairs:

Jon Tester, Chairman (MT)

Maria Cantwell, Member (WA)

Tim Johnson, Member (SD)

Tom Udall, Member (NM)

Al Franken, Member (MN)

Mark Begich, Member (AK)

Brian Schatz, Member (HI)

Heidi Heitkamp, Member (ND)

REPUBLICANS

John Barrasso, Vice Chairman (WY)

John McCain, Member (AZ)

Lisa Murkowski, Member (AK)

John Hoeven, Member (ND)

Michael Crapo, Member (ID)

Deb Fischer, Member (NE)

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Steve Ruddock

Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.

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