Tribes say states’ taxing of their casinos is unfair

Indian tribes told a Senate panel Wednesday that state governments were unfairly taxing their gambling operations in violation of federal law to make up for budget shortfalls.

California Gov. Gray Davis told state tribes early this year that he wanted $1.5 billion in revenue sharing from casinos to help with the state’s budget woes, although he later lowered that number to $680 million, said Brenda Soulliere, a member of the Cabazon Band of Mission Indians.

“It just really gets old being looked at as a cash cow. And that’s how tribes are being looked at,” Soulliere told the Senate Indian Affairs Committee.

The hearing took place amid the backdrop of California and Wisconsin tribes renegotiating their gambling agreements with state governments looking to plug budget gaps. Arizona and New York recently signed agreements with tribes that give the state a cut of the slot machines, while Maine, Massachusetts and Idaho are considering letting their tribes open casinos.

Sen. Ben Nighthorse Campbell had the hearing to highlight this trend. Congress passed the Indian Gaming Regulatory Act in 1988 to give tribes an economic development tool to pull their members out of poverty, he said, not provide states with a new source of money.

“Fifteen years ago, no one could have seen that by 2002 that Indian gaming revenues would have grown to $14 billion,” he said.

Except for Aurene Martin, who oversees Indian affairs at the Interior Department, those who spoke were members of tribes.

Martin said her department has approved tribal revenue sharing in only six states — Arizona, California, Connecticut, New Mexico, New York and Wisconsin.

The issue has heated up because of the conflict between California tribes and Davis over a new revenue-sharing proposal, said Judy Zelio, a spokeswoman for the National Conference of State Legislatures. The Golden State, which has a massive budget deficit, also has the largest number of tribal casinos.

Only a few states share revenues with Indian casinos, and most tribal gambling operations don’t bring in a lot of money, she said.

Tribes don’t oppose revenue sharing but want the federal government to have a more active role in limiting the money state governments can take, especially from small rural casinos, said Jacob Coin, executive director of the California Nations Indian Gaming Association.

Now the Interior Department is approving all tribal gambling agreements whether they’re in the best interests of the tribes or not, he said. He considers the gambling agreements tribal assets, just like timber or oil.

“The issue for the tribes is more about how the federal government has not taken the issue of revenue sharing seriously,” Coin said.