Many Native Americans live on reservations with few economic opportunities. By the mid-20th century, tribes were looking for ways to try and improve their communities. As reservations were under federal law and not state law, they figured out that this would allow gaming. Gaming was profitable, and the income could help them build schools, hospitals, etc. This could make a big difference in impoverished communities.
The first Indian casino
The first Indian casino was built in Florida by the Seminole tribe. It was in 1979 that they established a high-stakes bingo parlor. A local sheriff wanted to arrest players at the bingo hall, but the tribe sued him. A series of court rulings ruled that bingo laws in states couldn’t be applied to bingo operations on tribal lands.
The first bingo parlor managed to generate money quite quickly, and other indigenous nations saw an opportunity. Other tribes began turning to high-stakes bingo because they saw that it could generate income for them to improve their communities. Other tribes added slot machines. By 2000, more than 150 tribes in 24 states had bingo operations or active casinos on their land.
Today, Native American gaming comprises various gambling operations, including casinos and bingo halls on Indian reservations or other tribal lands in the US. An example of this is the Gun Lake Casino in Michigan, which also has an online casino.
Significant Supreme Court Decisions
Many legal battles took place in the 1970s and 1980s over whether state laws applied to tribal lands. There were two decisions in the Supreme Court that had great significance for tribal gaming.
In 1976, a Chippewa family challenged an unexpected property tax bill they received from the county containing the reservation. The court ruled that states had no right to levy taxes on Native Americans on reservations. This affirmed that tribal authority limits state authority in regulatory matters.
In 1987, the case of California versus the Cabazon Band of Mission Indians went to the Supreme Court. In Riverside County, California, bingo and card games employed Indians and attracted mostly non-Indian customers. Due to this, state officials wanted to apply state and local gambling laws to the reservation games. The tribe didn’t accept this because they said it infringed on their sovereignty. The court ruled in their favor. Civil laws, including gambling, couldn’t be enforced on reservations without Congressional approval.
Indian Gaming Regulatory Act
The Indian Gaming Regulatory Act(IGRA) in 1988 provided a framework for Indian gaming. It defined three different classes of gaming, each of which required a different kind of regulation.
Class 1 gaming was social or traditional gaming and regulated exclusively by the tribes. Class 11 gaming included games like bingo and lotto and would be regulated by the National Indian Gaming Commission (NIGC). Class III gaming included casino games like slots, blackjack, roulette, etc., and required tribes to negotiate compacts with states.
There were many cases in the years following the passing of the IGRA that questioned the act. However, all the attempts to question and amend the IGRA have failed.
What it provided was a consistent legal and regulatory framework that allowed tribes to plan and invest in gaming with more confidence.
Looking at countries that gamble the most, strong legal frameworks and cultural acceptance usually go hand in hand with large gambling industries. Tribes in the US used legal and regulatory opportunities to build their gaming operations.
By 2020, at least 527 casinos were operating in 29 states, with an estimated $33 billion in revenue. Today, many Indian tribes rely on their gaming businesses as a source of revenue, job opportunities, and a driver of economic development.
Current discussions
In more recent years, tribes are not only operating brick-and-mortar casinos but also looking into online gaming, sports betting, etc. They are aware of the latest in tech world and use cutting-edge technology like mobile apps in their casinos. With digital gaming, issues of regulation and jurisdiction are complex.
The debate over the fairness of compacts is ongoing. There’s always a discussion about who gets a share in state-level regulatory and tax matters. Another issue that often comes up is how to manage the social costs of gambling.
