The Native American Press (Bemidji, Minnesota), 1993-01-29

              BABBITT CALLS FOR OVERHAUL IN
INDIAN GAMING REGULATION
WASHINGTON (AP)
Interior Secretary Bruce Babbitt
says the government has to put one
person in charge of making sure that
the growing Indian gambling
industry is regulated properly.
'' Someone has to have the authority
to find the bad guys and hang them,
Babbitt told the Senate Indian Affairs
Committee on Monday. Regulation
of Indian gaming is spread between
states, tribes, the Interior Department
and the new National Indian Gaming
Commission. Earlier this month, the
Interior Department's inspector
general alleged that unscrupulous
operators were cheating tribes out of
millions of dollars through lax
government oversight. Babbitt, who
was serving his first full day in office
Monday, is in charge ofthe Bureau
of Indian Affairs, one of the most
criticized agencies in the federal
government. Sen. Kent Conrad, D-
N.D., told Babbitt the agency was a
hornet's nest. "I think you're going
to find it's going to come to dominate
a good deal of your time," Conrad
said. Babbitt, a former Arizona
governor who has since represented
some Indian tribes in legal cases, said
BIA's "paperwork and decision
making is awesome in its leisurely
pace.'' He promised a plan within 60
days for cleaning up $2.1 billion in
Indian trust funds that investigators
say the BIA has mismanaged for
decades. Congress has been warned
that once the accounts are reconciled
that taxpayers may have to make up
Someone has to have the
authority to find the bad
guys and hang them,"
for money the bureau has lost. Babbitt
also said he would make a point of
improving the BIA's much-maligned
education system. Its schools have
been criticized for their extremely
low student test scores and poor
facilities.'' Surely one ofthe crowing
ironies is that this federal government
in its majesty and its resources has not
managed to distinguish" itself in
Indian education, he said. Members
ofthe committee, however, were more
interested in what he is going to do
about the Indian gambling industry
that has taken off since 1988, when
Congress passed a law regulating
it. More than 170 tribes have
started casinos or high-stakes
bingo games; some ofthe revenue
has been plowed back into
economic development programs,
new schools, hospitals and
community facilities. Tribes have
opposed Congress rewriting the
law, but Babbitt said some changes
may be necessary to centralize
gambling regulation. States, by
agreement with the tribes, are
responsible for the day-to-day
regulation of Indian casinos. But the
Indian Gaming Commission and BIA
are responsible for overseeing
management contracts and revenue
distribution plans. "We can make some
progress underexisting law, but honestly
I'm skeptical about howmuch," Babbitt
said. Tony Hope, chairman ofthe Indian
Gaming Commission, said in an
interview later that he agreed with
Babbitt.' 'I think that's the only viable
way to set up any sort of regulatory
system," he said. "Although I don't
know exactly how he intends to do that
I would say that would be a good idea.
Inspector General's Report Made Available from Interior Department
Secretary of Interior Babbitt Is In Charge &Out For The Bad Guys
St Paul Board Members Are Not Seated, Questions About Money
' American Indian Religious Freedom Act Meeting Dates Set
Red Lake Cemetary Desecration Memories Still Lingers
The Largest WeeMu Native Newspaper in North America
Department of Interior's Report and Federal
Court Cases go Hand in hand
We Support Equal Opportunity Fur AIM People
By Mel Rasmussen
On December 31,1992, the Inspector
General for the United States
Department ofthe Interior released his
report concerning the Indian Gaming
Regulatory Act and the failure of its
overseers to monitor and ensure the
rights ofthe Indian Nation. Contained
within this report were incidents that
showed the abuse ofthe tribes across the
country. Tribes have been ripped off to
the tune of $2 billion dollars in a year's
time by unscrupulous tribal leaders and
businesses.
Examples of this type of abuse ofthe
Indian Gaming Act are evident by
examining the various court cases that
have been filed in Federal court
concerning these rip offs. In the 4th
District Federal Court in Minneapolis
there are 37 lawsuits filed against
busLiccoCsthatliavehad on involvement
in raping the funds from the tribes. In
the 3rd District Court in St Paul there
are Usimilarcasesonfile. This amounts
to 51. cases of tribal abuse and misuse of
the gaming industry. The tip of the
iceberg isjust visible.
Companies such as International,
GMT Management, International
Gaming, Sodak Gaming, Interstate,
Hanson distibutors, Theisen, Allied
Gaming are just a few ofthe companies
who will be coming under scrutiny by
the courts. It is necessary to point out
that several of these companies have
had the involvement ofTribal Attorneys
and former casino managers in their
formation and implementation. These
companies are allegedly servicing the
Indian Casinos and Bingo Halls and
providing for their well being.
The PRESS feels that it is important
that the Indian Community be made
aware of the problems that exist. We
have printed the Inspector General's
Report so that the community can see
for itself that there are problems. The
statements from MIGA that play down
the report leave much to be desired and
are open to interpretation.
MEMORANDUMSURVEYREPORT
To: AssistantSecretaryforlndian Affairs
chairman, National Indian gaming
Commission
From: Assistant Inspector General for
Audits
Subject:    Final Survey Report on
implementation ofthe Indian Gaming
Regulatory Act (No. 93-1-349)
INTRODUCTION
This report presents the results of our
survey of the implementation of the
Indian Gaming Regulatory Act. We
performed the survey because
allegations concerning contracts for
gamingservices indicated that excessive
revenues were being realized by
operating companies at the expense of
the tribes and that other improprieties
in certain gaming operations on Indian
lands also existed.
Over 170 tribes have started high
stakes bingo games and/or casino-type
gambling, such as blackjack, poker,
and slot machines. With the revenues
receivedfromgaming operations, some
tribes have been able to build schools,
hospitals, sewer and water systems, and
other community facilities. Gaming
revenues have also provided capital for
financing new tribal industries. Further,
gaming has provided employment for
many Native Americans who live in
economically depressed areas and
overall has increased self-sufficiency
on many Indian reservations.
However, our review concluded that
there has been a lack of oversight of
Indian gaming, which has adversely
impacted the amount of proceeds being
realized by some tribes involved in
gaming operations. This occurred, in
part, because the Act did not provide
sufficient lead time for the Department
of the Interior to establish a regulatory
process for monitoring Indian gaming
prior to the tribes' being given authority
to proceed with gambling operations.
Also by law, the Federal Government is
severely limited in the amount of
oversight it can provide over what is
considered Class III gaming (casinos).
Inaddition, thcBureau ofl ndian Affai rs,
the National Indian Gaming
Commission, and some states have not
been diligent c tirncly \r the
establ ishment and execution of oversight
arrangements required by the Act to
monitor casino gambling and bingo
games. As a result, some gaming
establishments arc operating in direct
violation of the Act, and Indian tribes
may be losi ng significant income because
of fraud or abuse in an industry that is
generating revenues of approximately
$2 billion a year on Indian lands.
BACKGROUND
Historically, the majority of Indian
reservations have been economically
depressed and have experienced some
of the highest rates of poverty,
unemployment, and other adverse
socioeconomiccondiuons in the country.
During the 1980s, many Indian tribes
became involved in gaming activities
on Indian lands asa meansof generating
revenues for tribal governments.
Consequently, after years of debate, the
Congress passed the Indian Gaming
.Regulatory Act (Public Law 100-497,
as amended) to provide policy and
standards for the conduct of gaming on
Indian lands. The Act was signed into
law on October 17, 1988, and provides
the regulatory framework for various
forms of gambling on tribal lands. A
primary purpose ofthe Act is to provide
a statutory basis for tribal gambling
activities as a means of promoting
economicdevelopment, self-sufficiency,
and strong tribal government.
The Act defines three classes of Indian
gaming as follows:
- Class I gaming includes social or
traditional gaming that is played in
connection with tribal ceremonies or
celebrations.
- Class II gaming includes bingo and, if
played at the same location, pull tabs,
lotto, punch boards, tip jars, instant
bingo, and card games (such as poker)
not played against the house when
permitted by state law.
- Class III. gaming includes card games,
table games (such as blackjack and
craps), slot machines, electronic or
electromechanical facsimiles of games
of chance, and pari-mutuel wagering.
Class III gaming is lawful on Indian
lands only if it is conducted in
conformance withatribal-statecompact
that has been approved by the Secretary
ofthe Interior.
In Section 5 ofthe Act, the Congress
established the National Indian Gaming
Commission as the Federal agency with
primary regulatory responsibility over
Indian gaming operations.  The
Commission was included as part ofthe
Department of the Interior but in reality
operatcsasanindcpendentagcncy. The
primary role of the Commission is to
issue regulations governing gamin,
activities, approve tribal ordinances fo'
regulating Class II and Class III gaming
approve management contracts for Class
11 and Class III gaming, and monito:
and regulate Class II gaming operation!:
throughout the United States. The
Commission is also responsible for
investigating allegations of improper
activities and conducting background
investigations as necessary. Whcnsuch
investigations indicate a violation of
Federal, state, or tribal statutes, the
Commission is required to refer the
matter to the appropriate law
enforcement officials. In that regard,
Section 17 of the Act requires the
Attorney General toinvesti gate activities
associated with gam; i
the Act that may be a violation ofFcderal
law.
The Act gave the Secretary of the
Interior interim responsibilities for the
supervision of Indian gaming until the
Commission was fully organized and
had established the regulations needed
for oversight of Indian gaming. During
this interim period, the Secretary
delegated oversight responsibilities to
the Assistant Secretary for Indian
Affairs. These responsibilities included
but were not limited to ensuring that
background investigations on casino
management officials are performed
and reviewing, and approvingcompacts
between the tribes and the states and
contracts between the tribes and
management companies.
Sections 11 and 12 ofthe Act authorize
Indian tribes to enter into management
contracts for the operation of Class II
and Class III gaming activities. Section
12 further states that the Commission
may approve a management contract
only if it determines that the contract
provides for (1) adequate accounting
procedures and monthly verifiable
financial reports, (2) tribal access to
daily operations, (3) a minimum
guaranteed payment to the Indian tribe
that has preference over development
and construction costs, (4) a ceiling for
the repayment of development and
construction costs, (5) a contract term
not to exceed 7 years, (6) termination
provisions, and (7) a reasonable fee that
does not exceed 40 percent of the net
revenues. Tribes often engage the
services of management companies to
provide for the establishment and
managementofthescfacilities. Because
of the potential for substantial profits
(up to 40 percent ofthe net income) that
can be derived from these lucrative
gaming operations, we found that
individuals or enterprises with no
expertise in gaming or construction and
un-verified financial backing have at
times been offering tribes up-front
payments of as much as $1 million to
sign management contracts. As of
Octoberl, 1992, we estimated that well
over 200 contracts for management,
leasing, or supply services had been
entered into for Class II and Class III
operations.
The framework for regulating Class
III gaming is structured in accordance
with compacts between the tribes and
IG Report/Page 4
Founded! in 1331    Volume 2 Issue 3 B January Sf3, 1333
Copyright, The JVative American ,
w,  1333
Photo by EricEide
Vern Bellecourt Addressing Members of the St Paul Community at The Food Shelf Fundraiser
New St Paul AIC Board Members Not
Seated At Scheduled Meeting
By Mel Rasmussen
Wednesday night at 6:00 pm the
five newly appointed board
members to the St. Paul American
Indian Center's board were
supposed to be seated. However,
when these new members arrived
at the St. Paul Indian Center for a
scheduled meeting they found the
building locked and vacant. Other
members from the St. Paul Indian
community stood by and wondered
what was occurring.
Recent facts indicate that a
major rift has devleopcd between
the existing Executive Committe
and the appointed board members
at the St. Paul Indian Center. This
tension has occurred for some time
andtheappparent crowning touch
was in the loss ofthe United Way
funding for the St. Paul American
Indian   Center   Food    Shelf.
According to long time members
ofthe community there have been
major problems within the St. Paul
Indian Center with its management
of programs. One of the most cited
problems was the micro-managing of
the administrative staff by the
Executive Board.
Another issue has come to light
since the Sunday fundraiser at
O'Gara's Garage for the food shelf.
On Tuesday evening, the St. Paul
Pow-Wow Committee met and
decided on a tentative date for the
Second Annual St. Paul American
Indian Center Traditional Pow
Wow. The tentative date and
location is Saturday, February 20
at the East side St. Paul Armory.
But more importantly was the issue
ofthe possibility of some missing
funds.
According  to  Mr.   Daniel
Manuel, he received a donation
from NSP for $3,000 for the Pow
Wow. After discussion at this
meeting Mr. Hubert Denny who is
the Treasurer at the St. Paul Indian
Center said that there was
approximately $2,000 available
for the Pow Wow Committee. This
brought a great deal of attention
from the committee and the issue
was to be raised Wednesday at the
scheduled board meeting. There
is a concern about the
accountability and use of these
dedicated funds.
At this time, the PRESS has no
further information as to who and
why the meeting was cancelled.
However, in a canvass of St. Paul
community members there is a
sign of distrust and displeasure
with the current conditions that
exist at the St. Paul Indian Center
and with the current management
by the existing board.
Detox Employee May Defy State Subpoena
By Gary Blair
Minnesota State officials who are
probing patient abuse at the recently
closed Hennepin County Detox
Center learned this week that they are
now facing an unexpected impass.
Lynn Fitzpatrick, one of the two
"whistle blowers'' who reported the
abuse is not expected to repond to the
subpoena the state issued her. Both
Jim Loving, State Department of
Human Services, and Mike Tripple,
State Department of Health, say
Fitzpatrick's information and
documentation is vital in concluding
their department's investigation.
The Detox Coalition, a group that
has pushed for an investigation into
the patient abuse at the old 1800
Chicago Avenue site, say they support
Fitzpatrick's decision to withhold her
information. They want a federal
grand jury to examine the findings
which they say should include charges
of rape, felonious assault, patient
neglect and theft of patient property.
Mistrust developed when it was
learned that state officials knew about
the abuse for many years and hadn't
taken corrective action.
Mike Tripple became angry when
the Press told him about Fitzpatrick's
decision. He said, "We have done
our best with the Detox, we couldn't
find people when they made the earlier
complaints." Frank Broderick, a
former counselor at the old Detox
Center who says he also submitted
reports of patient abuse to state
officials, tells a different story. He
said, "Hell, I even went over to the
health department to make sure they
had received my reports. I was told
they'd get back to me. I never heard
from them."
The Press has been shown copies of
DetOX/Page 5
Senate Select Committee
SchedulesReligious Freedom Act Hearings
By Mel Rasmussen
The United States Senate Select
Committee on Indian Affairs has
finalized the schedule for upcoming
hearings concerning the proposed
Amendments to the America Indian
Religious Freedom Act. Below is a
listing of the time and locations set
forth as of this date.
February 4, 1993, Thursday,
University of Manoa Campus, William
S. Richardson School of Law, 2515
Dole Street, Honolulu, Hawaii, 5:00 -
8:00 pm.
February 8,1993, Monday, Scottsdale
Community College, Performing Arts
Center, 9000 E. Chaparral Road,
Scottsdale, Arizona, 2:00 - 4:00 pm.
February 9, 1993, Tuesday, Pueblo
Indian Culture Center, 240112th Street,
N. W., Albuquerque, New Mexico, 2:00
AIRFA/PAGE 7