Balancing State Budgets with Indian Gaming Revenues?

From the Houston Chronicle: “In a move described as questionable and a potential time bomb, the state’s budget balances on a gamble it will win a court case against the Ho-Chunk Nation.”If the state loses, a $72 million hole could be blown into Wisconsin’s budget.

“Passed just a week ago, the budget assumes that a court will order the Ho-Chunk to make payments to the state that the tribe says it does not owe. The state Department of Administration estimates the tribe will owe about $72 million in fees under its gambling compact by June 30, 2009.

“But a lawsuit over the money is pending in federal court and there are no guarantees that the state will win, get as much as it is seeking, or that payment will be received during the current budget cycle.

“I would consider this a potential time bomb inside the budget,” said Sen. Robert Cowles, R-Green Bay. He questioned assistant Department of Administration Secretary Dan Schoof about the case during a hearing Wednesday related to a state audit of casino payments.”

Seems like a stretch to balance a government budget with the anticipation of winning a lawsuit, given the uncertainties of litigation. Michigan just passed its budget. One wonders if the Legislature counted the revenues it might win in the Keno case.

Shinnecock Nation Loses Gaming Case

From Indianz: “Citing the “disruptive nature” of the Shinnecock Nation’s attempts to assert sovereignty, a federal judge on Tuesday blocked the New York tribe from opening a gaming facility on ancestral land. The tribe has lived on Long Island for thousands of years. Its reservation, located in the heart of the wealthy enclave known as the Hamptons, is recognized by the state as sovereign land. But in a 129-page ruling, Judge Joseph F. Bianco said a disputed parcel outside the eservation is not sovereign territory. Though the tribe owns the “Westwoods” land in fee, it lost aboriginal title hundreds of years ago, the lengthy decision stated. Bianco, a Bush appointee, said “the evidence overwhelmingly demonstrated in a plain and unambiguous manner that aboriginal title held by the Westwoods land was extinguished in the 17th century.” Yet even if aboriginal title still existed, Bianco said the tribe can’t use the site for gaming due to the “highly disruptive consequences” of the proposed 61,000-square-foot casino. Nearly 20 pages of the opinion were dedicated to the impacts of gaming on the environment, traffic, health and safety. To back up his reasoning, Bianco cited a recent U.S. Supreme Court case that has hurt several tribes as they pursue their land and sovereignty claims in New York. The Sherrill case required the Oneida Nation to go through the land-into-trust process before asserting sovereignty over properties within its ancestral reservation. The 2nd Circuit Court of Appeals has since used the decision to throw out a land claim by the Cayuga Nation and the Seneca-Cayuga Tribe. In his ruling, Bianco said Sherrill has “dramatically altered the legal landscape” of tribal claims. “The 2005 decision of the United States Supreme Court in Sherrill set forth the legal framework under which a court must examine equitable doctrines in the context of an attempt by an Indian tribe to re-assert sovereignty over a parcel of land,” Bianco wrote.”

This case raised very narrow issues, but some of the issues have resonance throughout Indian Country. First, the court held that there is no common law right for Indian tribes to operating gaming facilities outside of the framework established by IGRA. Second, implicitly, the court held that Indian tribes cannot operate gaming facilities on fee land off the reservation. These are not terribly important questions, except to tribes with no usable land and to non-recognized or state-recognized tribes.
The opinions are here:

Gaming Court Decision (October 31, 2007):
Part 1 | Part 2 | Part 3

Land Claim Court Decision:
Shinnecock Nation v. New York (November 28, 2006)

Federal Recognition Court Decision:
New York v. Shinnecock Nation (November 7, 2005)

The Keno Case

In State of Michigan v. Little River Band of Ottawa Indians et al., the State is suing LRB and LTBB for violation of the gaming compacts requirement that the tribes share revenue from their gaming operations — LTBB Compact & LRB Compact. The tribes stopped payment when Governor Granholm authorized the state to begin keno at bars and restaurants. Senior District Court Judge Miles granted the State’s motion for summary judgment last April. The appeal to the Sixth Circuit is forthcoming. As those briefs go online, we will upload them here.

Judge Miles’ opinion is here: Opinion and Order

The State’s motion for summary judgment is here: Motion for Summary J

The tribes’ response brief is here: Tribes’ Brief

The State’s reply brief is here: Reply Brief

Saginaw Chippewa 2% Distribution History — $66.9 Million and Counting

From Joe Sawmick, spokesperson for the Saginaw Chippewa Tribe: Saginaw Chippewa 2 Percent Distribution History

So that’s about 3 and a quarter billion in net revenue. Whew.

Michigan Gaming Compact Revenue Sharing Benefits — LTBB

From the Petoskey News Review:

Allied EMS emergency medical technician
Chris Heckman (left) and paramedic Erik Slifka are shown with an ambulance and heart monitor purchased with assistance from the Emmet County Local Revenue Sharing Board.

Revenue-sharing grants have helped Allied acquire seven ambulances as well as assorted equipment for the vehicles through the years. “They’ve been very instrumental in helping us keep our operation going,” said Allied chief executive officer Dave Slifka. (Ryan Bentley/News-Review)
Deciding how the community will share in Little Traverse Bay Bands of Odawa Indians casino proceeds is not a game of chance.

Under its gaming compact with Michigan, the Odawa tribe is required to provide 2 percent of electronic gaming receipts from its Petoskey casino to nearby communities. The Local Revenue Sharing Board, a three-member appointed panel, is responsible for choosing specifically what projects and resources will receive support, reviewing grant applications twice yearly to decide which requests merit awards.

“We’re servants of the public,” said revenue board chairman Les Atchison. “We’re trying to do the best we can in our judgment to see that the money is put to best use. Frankly, we welcome the suggestions of those who appoint us.”

From its inception in 2000 through the end of 2006, the board awarded about $6 million in grants funded with casino proceeds. Since the tribe’s casino site is in federal trust status and not subject to property taxes, the board paid an additional $540,000 to local governments during those years to make up for tax revenue they would have received if the property was on the tax rolls.

The Shinnecock Tribe and the Handbook of Federal Indian Law

The Shinnecock tribe has an interesting argument in favor of their federal recognition. From the East Hampton Star:

“The Shinnecocks have since sued the Department of Interior in federal district court to be placed on the list. They maintain it is illegal to not place them on the list after they have received federal judicial recognition.

“The tribe also filed an amended complaint incorporating documents that show that the tribe was listed in a 1914 Department of Interior report to the United States Congress as a tribe in New York State subject to federal jurisdiction with federally protected lands. This was reaffirmed in other department lists dated 1929, 1938, and 1941, according to the Shinnecocks.

Mr. Gumbs noted that the tribe was also included in a book “The Handbook of Federal Indian Law,” compiled by Felix Cohen for the Department of the Interior in 1945, which includes the Shinnecocks in its listing of tribes in New York State. The tribes listed here and in the other department lists have all since been added to the department’s current list of federally recognized tribes or have successfully sued to be placed on it without having to go through the Bureau of Indian Affairs review, he said.

More details of the tribe’s claims are here.

Plans for Muskegon Casino?

From the Muskegon Chronicle: “Flying under the public radar screen since a successful 2003 non-binding city of Muskegon ballot proposal supporting the concept of a casino for downtown Muskegon, Archimedes Group LLC now has unveiled a $2.4 billion concept plan for a downtown Muskegon waterfront casino resort that is predicated on federal tribal recognition for the Grand River Band of Ottawa Indians.”

Later in the article, the Archimedes people made an assertion that doesn’t really stand up to scrutiny:

“Left unanswered is how the Grand River Band gains the ability to open an Indian casino in downtown Muskegon, but Archimedes spokesman Dick Anderson said the tribe is ‘on the cusp’ of federal recognition — a critical step in the process.”

Our post about the federal recognition process and the Grand River Band is here. There is support from Senator Levin, but I would surprised if there is a serious push in Congress to recognize the Band. I would like to be wrong, but announcing plans for casinos long before federal recognition is a certainty creates more difficulty for unrecognized tribes.

Gatzaros Awarded Stake in Greektown Casino

From the Detroit News: “After nearly 10 years of investigating Greektown businessman Ted Gatzaros, the Michigan Gaming Control Board today awarded him partial ownership in a Detroit casino.”By a unanimous vote, the board approved Gatzaros’ application to become a 1 percent owner in Greektown Casino. Before the vote, board members said they could find no reason to reject the request.”

***

“Gatzaros and his partner Jim Pappas were instrumental in pushing casino gambling in Detroit in the 1990s. After voters approved casino gambling in a statewide referendum, Detroit awarded the pair one of three casino licenses.

“Following an investigation, however, the Gaming Board indicated a license to the pair would not be approved. Gatzaros and Pappas ultimately ended up selling their interest to the Sault Ste Marie Tribe of Chippewa Indians.

“Under that sale agreement, the Tribe promised to sell a 4 percent interest in the casino and split the money between Gatzaros and Pappas. However, the agreement did not include a timetable for the sale.

“With the board’s decision today, Gatzaros has agreed instead to take 1 percent ownership in the casino.”