2017 navajo law seminar - sutin, thayer & browne...ngro - powers and duties: establish list of...

2017 Navajo Law Seminar

December 1, 2017

Raymond C. Etcitty, General Counsel Navajo Nation Gaming Enterprise

Navajo Nation Gaming Enterprise Fire Rock Navajo Casino near Gallup, New Mexico Flowing Water Navajo Casino near Shiprock, Navajo Nation (New

Mexico) Northern Edge Navajo Casino near Farmington, New Mexico Twin Arrows Navajo Casino near Flagstaff, Arizona

NNGE complies with Navajo Nation laws, State-Navajo Nation Gaming Compacts, and applicable federal & ttate laws.

2Indian Gaming within the Navajo Nation; December 1, 2017

Indian gaming within the Navajo Nation is complex legal framework that covers federal, state and Navajo laws; and state/tribal gaming compacts. The applicable laws and regulations that will be covered include the following:

1. Federal authority (Indian Gaming Regulatory Act, statute and regulations, and liquor authority);

2. Navajo authority (Navajo criminal code, Navajo Gaming Ordinance, Navajo Nation Gaming Enterprise, Navajo Liquor Ordinance, Navajo jurisdiction);

3. New Mexico/Navajo Nation Gaming Compact; and4. State Authority (New Mexico Gaming Control Board, liquor

authority, State jurisdiction).5. The presentation will also cover the history of Indian gaming

within the Navajo Nation.


California v. Cabazon, 480 U.S. 202 (1987) Cabazon Band of Indians developed a bingo hall within

the State of California. The State sued to use state gaming regulations. The U.S. Supreme Court balanced state interest in

preventing infiltration of criminal elements against tribal interest in sovereignty, economic development and self sufficiency Decision - a state has no authority to regulate internal

matters within an Indian reservation. The inherent authority of Indian tribes to conduct gaming pre-exist the federal and state governments

Indian Gaming within the Navajo Nation; December 1, 2017 4

Congress, in response to Cabazon, passed Indian Gaming Regulatory Act (IGRA) To regulate (i.e. lessen the inherent authority of tribes)

President Ronald Reagan signed IGRA on October 17, 1988 Public Law No. 100-497 Statutes (25 U.S.C. §2701- 2721 and 18 U.S.C. §1166-1168) Regulations (25 C.F.R. Parts 500-599)


Indian Gaming Regulatory Act National Indian Gaming Commission (NIGC) 3-member Commission

Office of Indian Gaming Commission – Regional Offices Region I – Portland Region II – Sacramento Region III – Phoenix (AZ, CO, NM & Southern NV) Region IV – St. Paul Region V –Tulsa Region VI – Oklahoma City; Headquarters


Indian Gaming Regulatory Act (cont.)3 classifications of gamingClass 1 – Traditional forms of gamingClass 2 – Pull tabs, bingo, poker, etc.Class 3 – Everything else (i.e. Casino-style

gaming, slots, roulette, craps, and blackjack)


Indian Gaming Regulatory Authority (cont.)NIGC - Purpose and Powers Regulates Indian Gaming (Class 2) Approves Indian gaming ordinances Approves tribal gaming management contracts Coordinates with other enforcement agencies

Class 3 (Casino-style gaming) Compact between State and Indian tribe (Approved by

Secretary of the Interior)


Indian Gaming Regulatory Act (cont.) Use of Gaming Revenues To fund tribal government operations or programs To provide for the general welfare of the Indian tribe and

its members To promote tribal economic development To donate to charitable organizations To help fund operations of local government agencies


Indian Gaming Regulatory Act (cont.) Tribal gaming is regulated on three levels: Indian tribes are primary regulators of Indian

gaming. Under IGRA, tribes establish regulatory framework for gaming within their territory Federal agencies (including the NIGC, DOI, DOJ,

FBI, IRS, Secret Service and the Treasury Department) enforce laws relating to Indian gaming. States may regulation Indian gaming through

compacts for Class III gaming Indian Gaming within the Navajo Nation; December 1, 2017 10

Indian Gaming Regulatory Act (cont.) Indian gaming cannot be conducted on any

tribal trust lands that were acquired after October 17, 1988, unlessContiguous lands,No reservation, 2-Part Determination, Land settlement, Initial reservation, Restoration of lands


Other federal laws include:18 U.S.C. §1167 – Theft by Guest18 U.S.C. §1168 – Employee theft (stiffer

penalties) IRS and tax complianceBank Secrecy Act (also known Title 31)


Laws of General Applicability Most federal laws are laws of general application.

There are various courts opinions on regarding whether federal laws of general application apply to Indian tribes among the Federal Court of Appeals.

The 10th, 8th, and D.C. Circuits follow the established principles of tribal sovereignty and self-governance, and require a showing of congressional pronouncement or clear intent before they applies statutes of general applicability to Indian tribes.

The 9th, 7th & 11th Circuits assume when Congress approves a law of general applicability, it applies to Indian tribes. This application is known as the “Tuscarora rule”.


Navajo Gaming Ordinance

5 N.N.C. §§2001 et. seq.Approved by CO–75-01 Submitted to NIGC in 2001NIGC would not approve, wanted changesAmended by CAP–34-02


Navajo Gaming Ordinance Foundation for a gaming industry within the

Navajo NationEstablishes how gaming is conducted

within the Navajo Nation


Navajo Gaming Ordinance: Who are the statutory parties? “Tribal Gaming Enterprise” “Board of Directors” “Gaming Managers” (CEO, COO, etc.) “Gaming Employees”

“Manufacturer, Distributor or Supplier of Gaming Devices” “Navajo Gaming Regulatory Office” “Executive Director”


Navajo Gaming Ordinance “Tribal Gaming Enterprise” All “gaming activities” will be owned by the Navajo

Nation and will be conducted and operated by a “Tribal Gaming Enterprise.” 5 NNC §2004 An entity designated to conduct gaming activities An enterprise of the Navajo Nation

Gaming Facilities (Navajo Casinos) Requires “Gaming Facility License” prior to opening Require compliance, and semi annual renewals


Navajo Gaming OrdinanceMembers of the Board of Directors Requires background check Requires “Gaming Facility Operator’s License”

Gaming Manager Requires background check Requires “Gaming Manager License”

Gaming Employee Requires background check Requires “Gaming Employee License”


Navajo Gaming OrdinancePublic officials and employees of the

Navajo Nation shall not have any role in the management of the gaming facilityConflict of interest Separate tribal politics from business operation


Navajo Gaming OrdinanceA manufacturer, distributor or suppler of

gaming devices require gaming vendor licenseNeed background check Requires Gaming Vendor License

* NM Compact allows NGRO to issue license* AZ Compact also requires a gaming vendor license issued by Arizona Department of Gaming


Navajo Gaming OrdinanceNavajo Gaming Regulatory Office If there is no regulation of gaming, no gaming There is no “gaming commission”Within Navajo Executive BranchNGRO regulates gaming within the Navajo

Nation Navajo Gaming Ordinance; Navajo Gaming regulations;

Tribal Internal Control Standards; Compacts, etc.


Navajo Gaming Ordinance NGRO Staff (Main Office & at TGO at each

Casinos) Executive Director Auditors, Agents, Investigators, Licensing and Surveillance

NGRO Executive Director: Retained by a 4-year contract with the President Contract approved by the Navajo Nation Council

Paulene Thomas, Executive Director


NGRO - Powers and Duties: Establish list of people who are casino threat Approve rules for all games of chance Require all vendors of over $10,000 to allow NGRO audits Perform background investigations for gaming licenses Approve or deny gaming licenses and employee id cards

(badges) Investigate gaming activities to protect the public interest Detain persons and summoning law enforcement Issue subpoenas, a notice of violation, or impose civil penalty A designated agent to NIGC Establish a revolving account to deposit the licensing fees Do all other things reasonably necessary


Title 17, Navajo Nation Code (Criminal Code) Prohibition of liquor; § 410 (Possession), § 411

(Manufacture or Delivery) §412 (Exceptions) Resolution CYJ-62-01 (Exception for Antelope Point) Resolution CYA-03-08 (Exception of Navajo casinos) Resolution CJY-40-12 (Allow for Arizona liquor licenses) Resolution CJN-27-13 (Allow liquor on gaming floor)

Navajo Liquor Regulations were initially adopted and approved by the Navajo Tax Commission by Resolution TAX-08-208


State of New Mexico/Navajo Nation Approved in Summer 2015 No limitation of Gaming Devices/Card Tables Limitation on Gaming Facilities Navajo Nation (3 facilities, 1 legacy facility)

Revenue Sharing Sliding scale 8.5% to 10.75% of adjusted net win,

depending on gaming revenues generated Paid quarterly to the State


Administered by NM Gaming Control Board

Other Costs Support compulsive gambling treatment programs State gaming regulatory expenses

Dispute Resolution Patron Disputes (NGRO administratively handle disputes)

Compact Disputes- Binding Arbitration

Patron Tort Claims NM law in state court, tribal law in tribal court

Expiration (June 30, 2037)


Approved in 2002 Signed by President Kelsey Begaye

Limits the Navajo Nation to 4 gaming facilities in Arizona

Limitation of gaming devices (2,400) Can transfer up to 1,400 to another tribe but the transfer

reduces the Nation to 2 gaming facilities Can pool gaming devices Proceeds of transfer considered net revenue

Tribes can’t conduct a paper lottery in competition with the Arizona Lottery’s Pick or Powerball games.


Administered by the Arizona Department of Gaming

State certification of Nation’s gaming licenses under certain circumstances Gaming Regulatory Office staff Non-Navajos Management (key employees) Manufacturers, Distributors and Suppliers

State Regulatory Costs (Paid to State) Sliding scale 1% to 8% of adjusted net win, depending on

gaming revenues generated


Other Costs Liability insurance policy of $2 million per incident

Dispute Resolution Patron Disputes – Gaming Regulatory Office will

conduct investigation to settle dispute Compact Disputes- Mediation and Arbitration

Liquor Sales Primarily regulated by State of Arizona

Expiration January 3, 2013 (10 year renewal option; 3 years

negotations)


New Mexico Gaming Control Board Regulates gaming within New Mexico

New Mexico Licensing and Regulation Dept. Alcohol and Gaming Division Regulate liquor industry within New Mexico

State Authority and Tribal Liquor Ordinance 18th Amendment (Prohibition), US Constitution 21st Amendment, US Constitution 18 U.S.C. § 1161 (US recognize state liquor laws) Rice vs. Rehner, 463 U.S. 713 (1983)

NM Navajo casinos possess Navajo-retailer liquor licenses; New Mexico regulates distributors/wholesaler


Nothing in the Liquor Control Act [60-3A-l NMSA1978] applies to: D. the sale, service, possession or public

consumption of alcoholic beverages by any person within the boundaries of lands over which an Indian nation, tribe or pueblo has jurisdiction if the alcoholic beverages are purchased from New Mexico wholesalers and if the sale, service, possession or public consumption of alcoholic beverages is authorized by the laws of the Indian Nation, Tribe or Pueblo having jurisdiction over those lands and is consistent with the ordinance of the Indian Nation, Tribe or Pueblo certified by the Secretary of the Interior and published in the Federal Register according to the laws of the United States."


Arizona Department of Gaming Regulates gaming within Arizona

Arizona Department of Liquor Licensing and Control Arizona regulates retailers, wholesales of liquor Twin Arrows possesses Series 6 Liquor licenses


1990s Early 1990s, Navajo gaming ordinance drafted 1994 & 1007, Navajo gaming referenda (FAILED)

2001 October – Navajo Gaming Ordinance approved by Navajo Nation

Arizona Prop 202; Arizona leasing/pooling slot allocations

2002 Amended Navajo Nation Gaming Ordinance approved by the NNC December – NN/AZ Gaming Compact approved by the NNC

2003 January – President Kelsey Begaye signs AZ Gaming Compact July – NN/NM Gaming Compact approved by the NNC September – President Joe Shirley signs NM Gaming Compact

2004 Gaming decriminalized if host chapters authorize gaming November – Navajo gaming referendum (PASSED)


2005 November - Eddie Lockett hired as NGRO Executive

Director

2006 July – Navajo Gaming Regulations approved September – NNGE Plan of Operation approved by

NNC

2007 CEO and Board of Directors selected for NNGE

2008 March – NNC amends Criminal Code to authorize the

sale of alcohol within Navajo casinos November – Grand Opening of Fire Rock Navajo

Casino


2009Carleen Chino hired as NGRO Executive Director

2010October – Flowing Water Navajo Casino Grand

Opening

2012 January – Northern Edge Navajo Casino Grand

Opening

2013May – Twin Arrows Navajo Casino Resort Grand

Opening


2015 April - President Ben Shelly signs NM gaming

compact June – US DOI approve NM/Tribal Gaming

Compacts

2016 April – NNC approves funds for TA Police and Fire

Substation July – NNC approves funds for TA Travel Center

2017Opening for TA Police and Fire Substation Paulene Thomas hired NGRO Executive Director


Thank you.


2017 navajo law seminar - sutin, thayer & browne...ngro - powers and duties: establish list of...

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