The Rincon Band of Luiseño Indians (“Rincon”) in California has taken a historical step under its federally approved Class III Secretarial Gaming Procedures to withdraw from California’s state oversight of its tribal gaming operations, and rely solely upon the National Indian Gaming Commission (“NIGC”) for performing regulatory responsibilities usually reserved for states.

Rincon and other Native American tribes offering Class III gaming (also referred to as “Las Vegas-style gaming”) do so in regulatory cooperation pursuant to the Federal Indian Gaming Regulatory Act (“IGRA”). Pursuant to the structure outlined by the IGRA, tribes are able to offer Class III games (e.g., slot machines and casino games like roulette) pursuant to Tribal-State Gaming Compacts negotiated with the applicable state. Generally, these compacts include provisions governing the regulatory and jurisdictional oversight of the tribal gaming operations.

However, as relevant to Rincon, the IGRA also provides an option for tribes when a state may be unwilling or unable to undertake the requisite regulatory requirements—namely, by allowing the NIGC to perform the state-level regulatory responsibilities. Indeed, the foundation for this step with Rincon was established nearly 10 years ago. After many years of litigation between Rincon and the State of California beginning in 2008, the Ninth Circuit Court of Appeals ultimately upheld the lower court’s decision that the state was operating in bad faith in negotiating a Tribal-State Compact with Rincon, and required the state to conclude compact negotiations.

In the cover letter approving the 2013 IGRA Secretarial Class III Gaming Procedures for Rincon and the State of California, the federal Bureau of Indian Affairs expressed concern that the state would be unwilling to perform the regulatory responsibilities, and explained that, “[i]f the State subsequently declines to fulfill its regulatory role, the procedures provide for NIGC to perform the State’s regulatory responsibilities.” Instead of a Compact, Rincon has thus been operating its tribal casino pursuant to these Secretarial Procedures.

In January 2023, Bo Mazzetti, Chairman of Rincon, announced that Rincon and the state had agreed that the NIGC would wholly take over the state’s regulatory responsibilities. Chairman Mazzetti stated that the parties had been unable to reach an agreement for the compensatory amounts Rincon would pay to the state for regulatory oversight, and what Rincon was “paying for to the state.” Going forward, Rincon will be working directly with the NIGC to conduct its Class III gaming.  

While Rincon’s IGRA gaming procedures were unique in containing the provision allowing for the NIGC to exercise regulatory oversight in place of the state doing so, there are several tribes in the State of California that are due to renegotiate their current Compacts in the next few years. Accordingly, it is possible that Rincon’s decision may prove influential for tribal gaming in California and elsewhere in the future.

https://www.jdsupra.com/legalnews/rincon-band-withdraws-from-state-8253175/