POJOAQUE PUEBLO SUES GOVERNOR OVER COMPACTS
Written by Guy Clark
During gambling compact negotiations between the five tribes/pueblos and the governor’s representative last week, some of the tribal representatives were urging the tribal leaders to cut off all revenue sharing to the state government. It sounds like at least one pueblo may be considering that advice.
In 2010 the Pojoaque Pueblo proposed that their existing compacts, paying the state 8% of gambling income, be renewed with the state. The state has countered with compacts requiring 9.5% initially, with the rate increasing to 10.5% over the next 23 years.
Pojoaque raised the odds (and the temperature) by countering with a proposal that they pay no revenue sharing to the state, insisting that the increase in revenue sharing is illegal.
They might have a point…if they declared that under Section 2710 Sec. (d)(4) of the Indian Gaming Regulatory Act of 1988, “…nothing in this section shall be interpreted as conferring upon a State or any of its political subdivisions authority to impose any tax, fee, charge, or other assessment upon an Indian tribe or upon any other person or entity authorized by an Indian tribe to engage in a class III activity.” To get around this very specific point of law, states and tribes agree to “side agreements” that contain the revenue sharing provisions that the states are anxious to receive, and the tribes are usually glad to pay to get the virtual monopoly of casino gambling that they get. This point of law has never been tested in federal courts.
Pojoaque lobbied vigorously during the original compact negotiations to get compacts that had a requirement of 16% revenue sharing. However, within months of their agreement, they balked at paying the agreed upon revenue sharing until repeated threats by the federal government over many months to shut them down got them to start paying.
This all may be just back-and-forth negotiating to try to get to common ground, or else the tribal leaders may have decided to follow the cry of their members to stiff the state.
It would be interesting to see a tribe try to use the federal law itself to justify breaking their contract. If one tribe got the Supreme Court to rule against revenue sharing, there would be a convulsion that would shake the whole gambling industry.
A Bloomberg Business Week story on the lawsuit can be found here.
