Star Tribune
Published February 8, 2004
As more and more state governments struggle with a still-sluggish economy, some are casting an envious eye on an industry that is more profitable than ever: Indian gambling.
Gov. Tim Pawlenty has put out the first feelers on recasting the deal struck between Minnesota and its tribes in 1989. Other states are on the same path.
To help patch his state's leaky budget, Wisconsin Gov. Jim Doyle last year gave the state's Indian tribes the right to some high-stakes games, such as roulette, baccarat and poker, in return for more than $200 million over two years and loosened rules that may permit the conversion of truck stops into "mini-casinos."
In New York state, leaders of the Oneida Indian Nation last month sent a letter to suppliers accusing Gov. George Pataki of a "shakedown" because he wants the state to get 25 percent of the profits from the tribe's lucrative Turning Stone Casino. New York's Mohawk tribe has already agreed to give the state 25 percent of its slot machine earnings.
California Gov. Arnold Schwarzenegger, laboring under a projected deficit that would bankrupt a small nation, has said he will seek to renegotiate tribal gambling compacts -- something Arizona and Connecticut have already done.
"Where there are successful gambling operations, virtually every state is looking at ways of getting more money out of those gambling operations," Sen. John Hottinger, DFL-St. Peter, said Friday.
Hottinger works on state policy issues with other legislators from the National Conference of State Legislators.
In Minnesota, where the state's projected deficit is $185 million and likely to grow, pressure to find revenues that don't involve raising taxes will be strong.
Tapping the revenue
Following his State of the State address on Thursday in which he said the compacts need to be revisited to provide a "better deal for Minnesotans," Pawlenty outlined a couple of possibilities during a WCCO Radio (830 AM) interview.
The tribes, he said, could "make a financial contribution to the state" in return for continued exclusivity. Recognizing that many tribal leaders would see that as a violation of their existing compacts, Pawlenty said the state's "other point of leverage" is the ability to negotiate new compacts for different games or additional locations.
That would make for a deal similar to the one that Doyle reached with Wisconsin tribes, although that accord is being challenged in the state's Supreme Court by legislative leaders, who say Doyle exceeded his authority in bypassing the Legislature.
Under the existing compacts, Minnesota's tribes have the right to operate blackjack and video slots, and they pay the state only a nominal fee of about $150,000 for regulatory costs.
That may strike some as unusual, but Judy Zelio, an analyst on gambling issues for the National Conference of State Legislatures, said it's not.
Of the 24 states that have tribal gambling compacts, she said, seven receive a portion of the profits: Michigan, Wisconsin, Arizona, California, New York, New Mexico and Connecticut.
In some states, Zelio said, tribes contribute to local governments, as in Louisiana. Other states, she said, "are just happy to have the economic development."
In some instances, she said, there is a potential roadblock: The federal Bureau of Indian Affairs has to sign off on any state-tribal compacts.LINK
Published February 8, 2004
As more and more state governments struggle with a still-sluggish economy, some are casting an envious eye on an industry that is more profitable than ever: Indian gambling.
Gov. Tim Pawlenty has put out the first feelers on recasting the deal struck between Minnesota and its tribes in 1989. Other states are on the same path.
To help patch his state's leaky budget, Wisconsin Gov. Jim Doyle last year gave the state's Indian tribes the right to some high-stakes games, such as roulette, baccarat and poker, in return for more than $200 million over two years and loosened rules that may permit the conversion of truck stops into "mini-casinos."
In New York state, leaders of the Oneida Indian Nation last month sent a letter to suppliers accusing Gov. George Pataki of a "shakedown" because he wants the state to get 25 percent of the profits from the tribe's lucrative Turning Stone Casino. New York's Mohawk tribe has already agreed to give the state 25 percent of its slot machine earnings.
California Gov. Arnold Schwarzenegger, laboring under a projected deficit that would bankrupt a small nation, has said he will seek to renegotiate tribal gambling compacts -- something Arizona and Connecticut have already done.
"Where there are successful gambling operations, virtually every state is looking at ways of getting more money out of those gambling operations," Sen. John Hottinger, DFL-St. Peter, said Friday.
Hottinger works on state policy issues with other legislators from the National Conference of State Legislators.
In Minnesota, where the state's projected deficit is $185 million and likely to grow, pressure to find revenues that don't involve raising taxes will be strong.
Tapping the revenue
Following his State of the State address on Thursday in which he said the compacts need to be revisited to provide a "better deal for Minnesotans," Pawlenty outlined a couple of possibilities during a WCCO Radio (830 AM) interview.
The tribes, he said, could "make a financial contribution to the state" in return for continued exclusivity. Recognizing that many tribal leaders would see that as a violation of their existing compacts, Pawlenty said the state's "other point of leverage" is the ability to negotiate new compacts for different games or additional locations.
That would make for a deal similar to the one that Doyle reached with Wisconsin tribes, although that accord is being challenged in the state's Supreme Court by legislative leaders, who say Doyle exceeded his authority in bypassing the Legislature.
Under the existing compacts, Minnesota's tribes have the right to operate blackjack and video slots, and they pay the state only a nominal fee of about $150,000 for regulatory costs.
That may strike some as unusual, but Judy Zelio, an analyst on gambling issues for the National Conference of State Legislatures, said it's not.
Of the 24 states that have tribal gambling compacts, she said, seven receive a portion of the profits: Michigan, Wisconsin, Arizona, California, New York, New Mexico and Connecticut.
In some states, Zelio said, tribes contribute to local governments, as in Louisiana. Other states, she said, "are just happy to have the economic development."
In some instances, she said, there is a potential roadblock: The federal Bureau of Indian Affairs has to sign off on any state-tribal compacts.LINK