While overall gambling revenue increased 12 percent at tribal casinos, tribes' portion of revenue sharing with state and local governments increased 30 percent in 2003 to $759 million, up from $583 million in 2002, according to the Analysis Group in a report released Wednesday.
"That's not good math on our behalf," said Kurt Luger, executive director of the Great Plains Indian Gaming Association, which represents 28 tribes in North Dakota, Montana, South Dakota, Nebraska, Iowa and Kansas. "We're very concerned about revenue sharing, especially in the Great Plains. We don't pay revenue sharing based on principle. It was never supposed to be about revenue sharing, it was supposed to be about economic development."
Casino tribes paid $759 million in revenue sharing agreements to state and local governments in 2003.
Tribes in Connecticut and California contribute the most to state coffers. Connecticut tribes paid $396 million in 2003, a 5 percent increase over the previous year.
At the same time, California tribes agreed to pay $132 million, an 81 percent increase from 2002. The spike is owed to previous state-tribal compacts signed in 1999 that went into effect in 2002, said Susan Jensen, a spokeswoman for the California Nations Indian Gaming Association.
As gambling profits increase, so does the debate about the importance of Indian-run casinos.
In 2003, 222 tribes operated 356 gambling operations in 30 states.
Overall, tribe-run casinos directly supported 12,000 new jobs in 2003 compared to the previous year. Wages for the same time period increased from $7.1 billion to $7.9 billion.
The Analysis Group report attributes continued tribal casino growth factors to gambling popularity, new casinos, expansion of existing casinos, local casino preferences by patrons, higher participation rates and increased non-gambling entertainment choices.
Montana, North Dakota and South Dakota - states where Indians are the largest minority group - saw revenue increases of 4 percent, 7 percent and 12 percent respectively. Indian-owned casinos in New York, Oklahoma and Idaho saw the greatest growth, with revenue increasing 116 percent, 32 percent and 28 percent.
Revenue increased 18 percent at California's Indian-run casinos.
Given federal mandates, negotiations with California officials worked to the benefit of tribal economies and tribal citizens, said Jacob Coin, executive director of the California Nations Indian Gaming Association.
Luger questioned tribes handing millions of dollars over to federal officials.
"It's not whether you can afford it," said Luger. "It's whether you should do it. Is that decision having impact on your tribal brothers and sisters? How far will you go before you're hurting other tribes?"
Coin's response: "It's not a matter of how far you go, it's matter of the political, legal, economical dictates you face in the state your in. The parameters are beyond the control of the tribe."
Federal law prohibits state and local governments from imposing taxes or fees as conditions to operate a casino, which calls into question the money tribes have agreed to pay states.
Sarah Bond, assistant attorney general for the state of Montana, described revenue sharing as "a bargain for consideration."
It's something states can offer tribes. For example, if state laws prohibit slot machines, the state can offer tribes an exclusivity right to install slot machines. It allows the state "a take. It's not a tax because no one has to do it," Bond said.
Like some Great Plains tribes, Minnesota tribal leaders also do not participate in gambling revenue sharing with the state. Revenue for Minnesota tribe-run casinos is estimated to be $1.4 billion.
"We aren't involved with it, we don't advocate it," said John McCarthy, executive director of the Minnesota Indian Gaming Association. He said the state has hinted of introducing commercial gambling to the Minnesota landscape to entice tribes to hand over profits. "My sense is the tribes in Minnesota would close casinos before they would revenue share," McCarthy said.
Reporter Jodi Rave can be reached at 523-5299 or at jodi.rave@missoulian.com
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