Cole calls proposed gaming rule changes 'highly unjust'
Cole: Proposed gaming rule changes 'highly unjust'
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By Tony Thornton
Published: February 20, 2008
MIAMI, OK — Proposed restrictions on certain forms of American Indian gambling are "not only destructive, but highly unjust," U.S. Rep. Tom Cole said today.
During a congressional field hearing on the issue, Cole, R-Moore, said rules proposed to clarify the difference between bingo-based electronic games and Las Vegas-style slot machines would "cripple" economic development by tribes.
This is the first congressional field hearing on the proposed changes to Class II gaming, which have been in the works for five years.
U.S. Rep. Dan Boren, D-Muskogee, scheduled the hearing, held at Northeastern Oklahoma A&M College in Miami. It drew about 200 people, mainly tribal representatives and attorneys.
Witnesses included officials from several tribes, the city of Miami and the federal agency that regulates the industry.
Miami and Ottawa County, with 10 Indian gaming locations, stand to be affected by the proposed rules more than virtually any other Oklahoma community.
Both Cole and Boren sit on the House Natural Resources Committee, which oversees American Indian matters. They were the only House members present, although others sent staffers.
The issue is especially important in Oklahoma, which had 59 percent of all the tribe-run Class II machines in the country as of December 2006.
Millions of dollars a year are at stake not only for tribes, but also for the state of Oklahoma, which receives a cut from all Class III machines, but nothing from Class II games. That money goes toward teacher pay raises and other education programs.
Most industry experts say the proposals would force Oklahoma tribes to go exclusively to compacted games.
'Devastating' impact feared
The proposed rules include a five-year grandfather period, meaning all existing machines would remain legal until at least 2013. Virtually all existing Class II games would become illegal at that point.
Some witnesses said the proposed rules would render Class II machines obsolete, because those that fit the proposed specifications would become so unappealing that few gamblers would use them.
Both Cole and Boren expressed concerns about the regulations.
During questioning of Norm DesRosiers, vice chairman of the National Indian Gaming Commission, Boren said tribes have spent "millions and millions of dollars investing in these machines." He cited a recent impact study that said more than 3,000 jobs could be lost if the restrictions are imposed.
Cole, a Chickasaw Nation member, said he finds the proposed definitions "deeply troubling."
"The impact on Indian country would be devastating," Cole said.
He called the proposal "a solution in search of a problem."
Oklahoma moving toward compacted games
The industry is governed by the Indian Gaming Regulatory Act of 1988. DesRosiers said the creators of that law didn't envision the technology that has blurred the difference between Class II and Class III machines.
Class III gaming cannot be conducted without a state compact. Class II requires no such agreement.
The proposed Class II clarification prompted Oklahoma tribes to support a law passed by voters in late 2004, which authorized Class III compacts.
Since then, tribes have migrated toward Class III machines. Tribes pay the state 4 to 6 percent of the revenue from those machines. In the first seven months of this fiscal year, that generated $37.2 million for the state.
DesRosiers said Oklahoma is moving quickly toward a total Class III market. The state's 50,000 gambling machines are split about equally between Class II and Class III, he said.
Cole repeatedly asked DesRosiers why the changes are needed, when most Oklahoma tribes are migrating toward Class III.
DesRosiers said the rule definitions are needed because tribes in several other states don't have Class III compacts.
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The Chickasaw Nation does wonderful things with tribal revenue from casinos. A friend of ours (WHITE) left an abusive relationship with help from the Chickasaw Nation. She and her child are safe, happy and she is productive because of their help. Without it, she would have been financially unable to get out.
Ada owes a large debt of gratitude to the Chickasaws.