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OCR Page 1 of 105OF
United States Department of the Interior
U.S.
OFFICE OF THE SOLICITOR
MARCH
8481
Washington, D.C. 20240
January 25, 1996
Memorandum
To:
John M. Quinn, White House Counsel
From:
John
Subject:
State
Leshy, of Massachusets/Warmpanoag Solicitor, Interior Tribe Gaming Compact
This follows up my telephone conversation with Elena Kagan yesterday, in which I described
the three problems - one policy, one mixed legal/policy, and one legal - we had identified with
the proposed compact. These are discussed in order.
The issues arise because the Indian Gaming Regulatory Act (IGRA) authorizes State-tribal
gaming compacts to contain provisions addressing the costs incurred by the State in regulating
Indian gaming activities. 25 U.S.C. § 2710(d)(3)(C)(iii). IGRA goes on to say that, with that
single exception, nothing in the Act shall be construed "as conferring upon a State authority
to impose any tax, fee, charge, or other assessment upon an Indian tribe
to engage in a
class III activity." 25 U.S.C. § 2710(d)(4).
I.
Department policy precludes approval of compacts that do not provide total
exclusivity for Indian gaming.
The compact contemplates annual payments of approximately $90 million to the State for six
years in exchange for limited restrictions on non-Indian gaming in certain areas of the State.
The Department has approved more than one hundred State/tribal gaming compacts to date.
Only a few have called for tribal payments to States (over and above whatever expenses the
States incur in regulating gaming authorized by the compacts). The Department has approved
compacts containing such payments only if the State agreed to completely prohibit non-Indian
gaming from competing with Indian gaming.
The $90 million payment by the tribe is designated for various purposes, some of which are
authorized under IGRA, 1 but most of the money (more than $77 million), is to be paid directly
to the State in consideration for limited tribal gaming exclusivity. This purpose does not fall
within the allowable uses of net gaming revenue under IGRA.
1
A small portion of the money will be paid to surrounding cities and towns and to non-
profit organizations providing services for compulsive gamblers. IGRA specifically authorizes
such payments to local governments and non-profits. See 25 U.S.C. § 2710(b)(2)(B)(iv) and (v).