reinforce these existing prohibitions and ask that you conduct thorough oversight of the CFTC to ensure that the agency is enforcing its own laws and regulations. The Importance of Indian Gaming to Tribal Government Economies When the United States formed, it acknowledged Indian tribes as sovereign governments, entering into hundreds of treaties with tribal governments to establish commerce and trade agreements, form alliances, and preserve the peace. The U.S. Constitution affirmed these treaties and the sovereign authority of Indian tribes as separate governments. The Constitution’s Commerce Clause expressly provides that “Congress shall have power to ... regulate commerce with foreign nations, and among the several states, and with the Indian tribes . ” 1 A handful of tribal governments in the 1970’s, tired of waiting on the United States to fulfill its treaty and trust obligations to tribes, took measures to rebuild their communities by opening the first modern Indian gaming operations. Tribes used the revenue generated from Indian gaming to fund essential programs for reservation residents, cover the federal shortfalls, and to meet the basic needs of their people. These acts of self-determination were met with legislative and legal challenges lodged by states and commercial gaming interests. In 1987, after years of contentious litigation, the U.S. Supreme Court, in Cabazon Band of Mission Indians v. California , affirmed that tribal governments have full civil regulatory authority to govern tribal gaming activities on tribal lands, exclusive of state government regulation so long as state law did not criminally prohibit all forms of gaming. On October 17, 1988, having been enacted by Congress, President Reagan signed the Indian Gaming Regulatory Act (IGRA) into law. IGRA divided gaming activities into three categories. Class I gaming encompasses social and traditional forms of gaming conducted by tribes traditionally, assigning full regulatory oversight to tribal governments. Class II gaming encompasses bingo, lotto, and similar games as well as non- house banked card games, assigning regulatory oversight to tribal governments and the newly established National Indian Gaming Commission. Class III gaming encompasses all other forms of gaming but requires the execution of a tribal-state gaming compact before a tribal government may conduct Class III gaming. Sports betting falls within Class III gaming, thereby requiring a tribal-state gaming compact before a tribal government may conduct sports betting. The NIGC is the first and only federal agency created and explicitly authorized by Congress to provide regulatory oversight in relation to gaming activities. In fact, the Justice Department strongly opposed IGRA in the years prior to its enactment on the grounds that as a matter of policy the federal government should not be involved in the direct regulation of gaming activities, which DOJ believed comes within the province of the states. Like most legislation, IGRA is the product of compromise between federal, state, and tribal interests. Congress made clear that the purposes of IGRA are to: 1) provide a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal government; 2) provide a statutory basis for the regulation of gaming by an Indian tribe adequate to shield it from organized crime, and to ensure that the Indian tribe is the prime beneficiary of the gaming operation; and 3) establish an independent federal regulatory authority for gaming on Indian lands, federal standards for gaming, and the NIGC to meet congressional concerns regarding gaming and 1 In addition, the U.S. Constitution refers to tribal citizens in the Apportionment Clause, as “Indians not taxed”, excluded from enumeration for congressional representation. The 14 th Amendment repeats the original reference to “Indians not taxed” and acknowledges that tribal citizens were not subject to the jurisdiction of the United States. The Constitution also acknowledges that treaties are the Supreme law of the land.
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