In 1988, the U.S. Congress passed the Indian Gaming Regulatory Act (IGRA), which recognized gaming as a way to promote tribal economic development, self-sufficiency and strong tribal government. The Act says a state must permit Indians to run gaming on reservations if the state permits such gaming off reservation. Under IGRA, a tribe that wants to engage in Class III casino-style gaming must first sign a Tribal-State Gaming Compact (Compact) with the state where the casino would be located and requires a state to negotiate in good faith with a tribe seeking a Compact. All negotiated and signed compacts are sent to the U.S. Department of the Interior for approval and become effective as soon as they are published in the Federal Register.
IGRA expressly granted states and tribes the power to jointly regulate Class III tribal gaming, which includes slot machines, blackjack, keno, and other casino style games. IGRA also created the federal National Indian Gaming Commission (NIGC) to oversee reservation bingo games and certain aspects of Class III gaming.
Gaming in Arizona
By the early 1990s, several Arizona tribes had installed slot machines in their casinos even though none of them had Compacts. The Governor of Arizona at that time, Fife Symington, said reservations should not have casinos because Arizona did not allow such gambling off-reservation. Tribes countered that Arizona did permit such gambling by allowing state lotteries, dog and horse racing, and charity bingo games off-reservation.
In May 1992, NIGC issued rules clarifying that a tribe must have a Compact before it can operate slot machines. Immediately after the rules were announced, the Arizona Governor called on the U.S. Attorney in Phoenix to shut down casinos with slot machines. Agents from the Federal Bureau of Investigation raided five Indian casinos and seized their slot machines. At Fort McDowell Casino near Scottsdale, tribal members formed a blockade to prevent the removal of the machines, and a three-week standoff ensued.
Against a backdrop of legal challenges by both sides that continued for more than a decade, Governor Symington signed Arizona’s first set of Compacts with 16 Tribes from 1992 to 1994. The Governor’s successor, Jane Hull, signed a Compact with a 17th tribe in 1998.
The Compacts gave tribes exclusive rights to operate slot machines and casino style gaming, limited the number of slot machines and casinos, established comprehensive rules governing gaming, and set minimum internal control standards for casino operations. The Compacts also authorized the State of Arizona to ensure compliance with the Compact and to work with tribal regulators to protect the integrity of Class III gaming on tribal lands. This first set of Compacts was in effect from 1993 to 2003.
In the November 2002 general election, Arizona voters approved Proposition 202, which authorized the continuation of Indian gaming. From December 2002 to January 2003, Governor Hull signed new Compacts with 16 tribes. In 2003, Governor Janet Napolitano signed Compacts with an additional five tribes. In November 2017, Governor Douglas A. Ducey signed a Compact with the Hopi Tribe.
All federally recognized tribes in Arizona have a Gaming Compact with the State of Arizona. The Compact with each of the 22 tribes is substantially identical, lasts for 10 years and can be renewed for another decade and an additional three-year term. The Compact is part of state law (see Gaming Compact & Statutes).
U.S. Supreme Court ruling sets the legal foundation upon which Indian gaming law is built (California v. Cabazon Band of Mission Indians).
Indian Gaming Regulatory Act (IGRA) – Congress responds to Cabazon by enacting IGRA, which establishes the federal legislative framework for Indian Gaming.
Yavapai-Prescott Indian Tribe v. Arizona – a federal district judge in Arizona rules that the state must negotiate with the tribe and attempt to conclude a Tribal-State Gaming Compact (Compact). The Legislature establishes the State Gaming Agency within the State Department of Racing.
Yavapai-Prescott Case – the federal mediator chose the tribe’s last, best offered compact over the state’s recommended compact. Negotiations followed resulting in “standard form” Compacts.
In Arizona, there were 16 Compacts and 10 operating casinos by December 31, 1994.
The Legislature creates ADG. The Salt River Pima-Maricopa Indian Community (SRP-MIC) files a lawsuit in federal court seeking to force Compact negotiations.
Seminole Court Case – the U.S. Supreme Court declares IGRA provisions that allowed states to be sued without their consent as unconstitutional. A federal court judge dismisses the SRP-MIC Court Case based on the Seminole decision. The tribe appealed. Rumsey Court Case - the 9th Circuit Court of Appeals rules that Class III gaming be examined game by game and allowed on Indian land only if permitted by a specific state law. Based on the Rumsey decision, Governor Symington refuses to negotiate a standard form Compact with the SRP-MIC and the tribe’s initiative measure that would require the Governor to sign a standard form Compact with any tribe seeking a Compact is placed on the general election ballot. Voters approve the measure, but the law is challenged in Superior Court. Ultimately, the Arizona Supreme Court upholds the initiative measure. Sears Case - the Superior Court rules that the Governor of Arizona lacks the authority to negotiate a Compact with SRP-MIC that permits slot machines and/or keno. The decision is appealed to the Arizona Supreme Court.
The Arizona Supreme Court overturns the decision in the Sears Case on the basis that Sears did not have standing to bring suit. Governor Hull begins Compact negotiations with the SRP-MIC and signs a Compact on August 16, 1998.
The Governor begins negotiating renewal of the Compacts. Expiration of the current compacts begins in June, 2003, if not renewed. American Greyhound Case - Arizona horse and dog tracks sue Governor Hull in federal court seeking either an injunction prohibiting the Governor from signing new Compacts or a ruling permitting the race tracks to have slot machines.
The court grants the request for an injunction in the American Greyhound Case and issues a ruling that among other things, the state legislature had unconstitutionally delegated its compacting authority to the Governor, and the tribes were not an indispensable party. However, the ruling provides that the Governor did have the authority to continue to negotiate Compacts, but may not enter into new Compacts without proper legislative approval. The state appeals.
January/February. Governor Hull and 17 tribes successfully conclude negotiations on an agreement for new tribal-state compacts.
April/May. The Governor and tribes take their agreement, as a resolution, to the legislature for approval. The legislature fails to pass the resolution.
June/July. The 17 tribes gather enough signatures to put the tribal-state agreement on the 2002 General Election ballot as Proposition 202. Two additional gaming initiatives also appeared on the ballot, Proposition 200, sponsored by the Colorado River Indian Tribes (CRIT), and Proposition 201, sponsored by the race track industry. In September, the 9th Circuit Court of Appeals overturns the decision in the American Greyhound Case. The court rules that the tribes were a necessary and indispensable party, and that the district court abused its discretion in ruling to the contrary. They vacate the lower court decision and remand it with instructions to dismiss the case. Power to sign Compacts is returned to the Governor. In November, Proposition 202 passes, while Proposition 200 and 201 fail. From December 2002 to January 2003, Governor Hull signs new Compacts with 16 Tribes.
In 2003, Governor Napolitano signs Compacts with an additional five tribes. A state program to address problem gambling is established under ADG.
Appendix F(1) Blackjack – Revised – Revisions to Appendix F(1) allow for play of blackjack variation games at tribal casinos, while keeping blackjack as the central component of any variation game and maintaining the wagering limitations established by the Compact.
Appendix G Lotteries and Promotions – New Appendix G establishes operational standards and regulations for the play of Class III lotteries authorized by the Compact. This Appendix also provides clear definitions for differentiating lotteries from promotions.
Appendix C Security & Surveillance – Revised – Changes to the existing Appendix C require the tribes to develop and have in place comprehensive surveillance and security plans that meet the obligations of the tribe under the Compact and its appendices. Revisions also eliminate duplication of operational standards between Appendices C and H.
Appendix H Minimum Internal Control Standards – Revised – Modifications to Appendix H eliminate duplication and inconsistencies between Appendices C and H, consolidate Minimum Internal Control Standards for Surveillance within Appendix H, update the Appendix H standards for new digital technology, and provide for increased surveillance coverage within the gaming areas.
ADG’s Problem Gambling Program hosts first symposium.
Appendix F(2) Jackpot Poker – Revised – Changes to existing Appendix F(2) allow play of promotional award poker and house-banked poker games at tribal casinos, while keeping poker as the central component of any variation game and maintaining the wagering limitations established by the Compact. Revisions also establish regulations for house-banked poker games comparable to regulations for blackjack.
Gaming Compact Amendments (effective 3-25-09) – Amendments to the Compact clarified several definitions, increased wager limits, established a compliance reporting timeline, clarified the reporting timeline for tribal contributions, provided a means for a waiver of the vendor licensing requirement, extended non-certified employee licensing periods, and provided for memorandums of understanding regarding investigatory files.
Appendix J Vendor Certification – Created the waiver of licensing and certification for certain persons providing Gaming Services and certain financial sources.
Urban Tribes State Electronic Access System MOU – Sets forth the means and manner in which ADG will have real-time, read-only electronic access to the Gaming Facility’s slot monitoring and control system (MCS) through the State Electronic Access System (SEAS).
Gaming Compact Renewal (2012-2013) – As set forth by Proposition 202, the Compacts shall automatically renew for a term of ten (10) years, except in the case of substantial non-compliance.
Appendix A Gaming Devices – Revised – Updated the technical and regulatory standards for gaming devices, components, software, kiosks, and progressive gaming devices.
In November, Governor Douglas A. Ducey signs a Compact with the Hopi Tribe, so that all 22 federally recognized tribes in Arizona now have a Compact with the State of Arizona.