Tribal Self-Regulation of Class III Gaming

Area of Expertise: Business Litigation

Originally published in Indian Gaming | April 2006

The Northern Arapaho Tribe is the first ever to operate and self-regulate Class III gaming. Instead of operating under a Tribal-State compact, the Tribe offers Class III gaming under “procedures” issued by the Secretary of the Interior and coordinates its self-regulation of Class III games with the National Indian Gaming Commission (NIGC).

To achieve this result, the Tribe, Secretary of the Interior, and the NIGC worked cooperatively to develop a specific section of the Secretarial procedures regarding self-regulation. That section also was enacted by the Tribe as an amendment to the Northern Arapaho Gaming Code, approved by the NIGC.

The cornerstone of self-regulation is the independent and autonomous status of the Northern Arapaho Gaming Agency (NAGA) under the Tribe’s Gaming Code. Unless specifically permitted in the Code, the Tribe’s elected officials have no prior or subsequent review of actions taken by the NAGA in the fulfillment of its duties. To avoid potential conflicts of interest between the operation and regulation of the Tribe’s Wind River Casino:

  • No member of the Tribe’s Business Council or any gaming management board or advisory board may serve on the NAGA.
  • No member directly related to or living with any Business Council member or management board or advisory board member may serve on the NAGA;
  • Members of the NAGA are prohibited from gambling in the casino; and
  • Members of the NAGA are prohibited from accepting complimentary items from the casino or any licensee or applicant for a license.

Disputes over decisions of the NAGA must be resolved according to the dispute resolution sections of the Tribe’s Gaming Code and regulations, which require appointment by the Tribe of an independent administrative law judge. Standard administration procedures (which also apply to licensing disputes) govern the calling and conduct of hearings.

A critical component of self-regulation is the hiring of a primary regulator by the Tribe or by the NAGA, who is charged with a number of specific duties. The tribal regulator must:

  • Ensure the posting of notice to patrons that states: This facility is regulated by one or more of the following: The National Indian Gaming Commission and the Government of the Northern Arapaho Tribe. This facility is not regulated by the State of Wyoming. 
  • Assure that the Tribe complies with all Secretarial procedures and that documentation of compliance is maintained and sent to the NIGC upon request.
  • Establish a time frame for performing routine preventative maintenance and testing of machines pursuant to the Tribe’s and NIGC regulations.
  • Meet or otherwise communicate with the NIGC regarding the Tribe’s compliance with the Secretarial procedures.
  • Notify the NIGC of any regulations or procedures that the Tribe promulgates regarding limits of wagering, hours of operation, check cashing, problem gamblers, child support garnishments, and other matters.
  • Maintain and make available to the NIGC a procedural manual for casino employees that includes rules and regulations of conduct and disciplinary standards for breach of the Secretarial procedures.
  • Notify the NIGC of all Class III games to be placed in the Tribe’s Wind River Casino before installation. Before any new Class III games are conducted at the casino, the tribal regulator must:
    • Ensure that the Tribe’s casino develops rules and procedures for a system of internal controls for the new game that meets appropriate standards.
    • Require that the Tribe’s casino provide appropriate training for all dealers, supervisors, surveillance personnel and any other employees involved in the conduct or regulation of the new game, and for the Tribe’s gaming agency, such that those employees have the knowledge and skills required under typical industry standards for the job function that each employee performs.
    • Ensure that the Tribe’s casino establishes a security and surveillance plan for the new game that meets appropriate standards.
    • Adopt rules of operation for the game that meet the minimum standards established in the Secretarial procedures, including rules of play and standards for equipment.

The tribal regulator is subject to NIGC’s background investigation and licensing standards for key employees and primary management officials, including the requirement that background information, and suitability determinations are forwarded to the NIGC. Both the Tribe and the NIGC must find the tribal regulator eligible under these standards.

The Tribal regulator may be fired only for cause and after notice to the NIGC. Disputes over firing are to be resolved according to the Tribe’s Gaming Code and regulations, which, as noted, require appointment by the Tribe of an independent administrative law judge.

The Tribe must provide an adequate and reliable yearly budget for the tribal regulator’s position. The regulator’s expense from a previous year, based on hours required to perform the work, provide the basis for reimbursement of the regulator or establishment of that budget in subsequent years.

Tribal self-regulation is an innovative and also a logical approach whenever Class III gaming is conducted pursuant to Secretarial procedures instead of a Tribal-State gaming compact. The Northern Arapaho Tribe’s dedication to the principled government is commendable and has allowed the Tribe to seize this unique opportunity. Gaming provides sorely needed revenue for tribal government, but self-regulation enhances the sovereignty of the Tribe in a direct and significant fashion. Fair and independent self-regulation is a reward for  tribal government that is commensurate with its challenge. The Northern Arapaho are well suited to the task, have accepted the challenge, and are leading the way.

The Northern Arapaho Tribe is the first ever to self-regulate Class III gaming. Based on its experience with the State of Wyoming on gaming issues, the Tribe determined that oversight by the NIGC, in conjunction with oversight by the Secretary of Interior under the Indian Gaming Regulatory Act, was far preferable to oversight involving the State. The requirements for Class III self-regulation are based on principals recognized by the Tribe as important for responsible government and include standards familiar to casinos across Indian Country. While self-regulation is not new to state governments (which regulate their own lotteries), it is new to Indian Country. Self-Regulation directly promotes tribal sovereignty by vesting primary authority for the regulation of Class III gaming with the Tribe itself.

Andrew Baldwin represented the Tribe in Northern Arapaho Tribe v. State of Wyoming, 389 F.3d 1308 (2004), and is a shareholder in Baldwin, Crocker & Rudd, P.C., a firm emphasizing the practice of Indian Law.