Department of the Interior Issues Final Rule for Review of Class III Tribal-State Gaming Compacts

By Heidi McNeil Staudenmaier and Amanda Z. Weaver, Ph.D.

On February 16, 2024, the United States Department of the Interior (“DOI”) issued revisions to its regulations for how it reviews Class III Tribal-State Gaming Compacts under the Indian Gaming Regulatory Act (“IGRA”). The final rule was published in the Federal Register on February 21, 2024, and will be effective on March 22, 2024.  

The rule is intended to update the 2008 regulations on the DOI’s review process for Tribal-State Gaming Compacts, specifically to “codify longstanding” DOI “policies and interpretation of case law in the form of substantive regulations,” in order to “provide certainty and clarity on how the Secretary will review certain provisions in a contract.” 25 C.F.R. Part 293, § III. The changes are intended to (1) clarify boundaries “as to allowable topics of negotiation”; (2) better define “key terms”; and (3) clearly outline “when the Department must review a gaming compact.” See U.S. DOI Press Release, February 16, 2024.  

Several “key terms” have been amended, including “amendment,” “compact,” and “extension,” and several new definitions have been added, including “gaming activities,” “gaming facility,” “meaningful concession,” and “substantial economic benefit.”

Allowable topics of negotiation include, for example, allocation of criminal and civil jurisdiction between the Tribe and the State, the Tribe’s taxation of gaming, and resolution of disputes for breach of the compact. Another allowable topic of negotiation is whether a compact or amendment may include provisions addressing statewide remote wagering or internet gaming (which appears to implicate the current situation in Florida concerning the Seminole Tribe’s ability to offer mobile sports betting on a state-wide basis).

The revised rule also delineates factors the Secretary will analyze to determine if revenue sharing is lawful. 25 C.F.R. Part 293, §§ 293.26, 293.27. This includes whether revenue sharing provisions co-exist in exchange for a State’s “meaningful concessions resulting in a substantial economic benefit for the Tribe,” and that the Department reviews revenue sharing provisions “with great scrutiny, beginning with the presumption that a Tribe’s payment to a State or local government for anything beyond [a] regulatory fee is [] prohibited . . .”  25 C.F.R. Part 293, § 293.27.

Secretary of the Interior Deb Haaland announced that updating the regulations “will provide certainty and clarity to Tribes for an industry that remains one of the most significant sources of economic development . . .”  Id. The rule’s background invokes the trust obligations of the United States to the Tribes — as Congress expressly included in the IGRA — in updating the rules to “protect Tribal sovereignty during [the Secretary’s] review of compacts.'' 25 C.F.R. Part 293, § III.

With the effective date of the final rule as March 22, 2024, all compacts and amendments pending on that date will be processed under the prior regulations, unless the Tribe or State requests in writing to proceed with the new regulations. 25 C.F.R. Part 293, § 293.30(a). All compacts and amendments submitted after March 22, 2024, will be subject to these new regulations.