Indian gaming is one of the strongest
industries in the state. Nearly 56,000 Californians are employed
by tribal gaming facilities.
Statewide, Indian gaming directly or indirectly
employs more than 200,000 Californians, 90% non-Native Americans.
Tribal gaming also generates well over $400 million in federal,
state and local taxes annually.
As mandated in the Tribal-State Compact,
payments made by tribes to the Revenue Sharing Trust Fund, the
Special Distribution Fund and the state's General Fund from 2000
to September 30, 2005 totaled $543.4 million. Tribes also donate
an estimated $70 million annually to local charities and community
groups.3*
If you need further proof about tribal
government gaming and its benefits to local economies, just look
at what the industry is doing for Riverside County alone:
• $2.4 billion in overall economic
activity
• Total combined direct and indirect economic impact of
tribal government gaming generated 54,677 jobs and $1.3 billion
in payroll
• Total impact of tribal economic activities resulted in
over $1.1 billion in purchases
• Tribal government gaming operations employed over 10,000
county residents
• Tribal government gaming operations generated $460 million
in payroll
• Tribes purchased $330 million in goods and services from
local suppliers
• Tribal government activities resulted in $124 million
(directly), and $220 million (indirectly) in federal and state
income and payroll taxes
Do Indians pay taxes?
The question of whether or not California Indians
are subject to the full array of taxes that non-Indians pay has
led to misunderstanding and confusion for both Indians and non-Indians.
All residents of the United States, including Indians, must pay
federal income tax. However, whether or not Indians are subject
to California state income tax is more complicated.
California Indians do not pay state income tax
if they are “eligible” Indians, live on a reservation
or Indian trust allotment, and work on the reservation or trust
allotment. If they live or work off the reservation or trust allotment
Indians must pay state income tax.
Indians pay real property tax on property owned
off a reservation or trust allotment, but do not pay property
tax on land or buildings built on reservation or trust allotment
land. However, if a tribe or individual Indian owns the land “in
fee” the property is subject to taxation.
Indians are not subject to fees and licenses
that apply to buildings or activities that occur on reservations
or trust allotments. Indians are exempt from paying vehicle license
fees by legislation signed by Governor Gray Davis in 1999 if vehicles
are used primarily on reservation land.
Indians pay sales tax on sales off reservation
and trust allotment land, but are exempt from paying sales tax
on most sales on reservations.
In 2002, Native Americans alone paid $4 billion
in personal federal income taxes. In California, tribal government
gaming generates more than $400 million in federal, state and
local taxes each year.
It is important to remember that under federal
law, tribal government gaming cannot be taxed like a business.
The tribal governments own the facilities. Like the California
lottery, which does not pay taxes on its revenues because it is
owned by the state, Indian casinos don’t pay taxes because
tribal governments own them. Governments cannot tax other governments.
Aren’t casinos just magnets for crime?
What about the effects on property values?
Gaming opponents want people to think that there
is a direct link between Indian gaming and increased crime. In
fact, research shows that the social problems in communities with
casinos are no different than those in communities without casinos.
A study issued in 2000 by the General Accounting
Office (GAO), the investigative arm of the U.S. Congress, found
"no conclusive evidence on whether or not gambling caused
increased social problems….”
A popular myth perpetuated by gambling opponents
claims that the introduction of casinos causes a rise in street
crime. However, recent studies refute this claim. Communities
with casinos are just as safe as communities without casinos.
A 1997 study by Peter Reuter of the University
of Maryland provided additional evidence refuting a causal linkage
between crime and gaming. In his Report for the Greater Baltimore
Committee, Reuter concluded the following: "In no case is
there any evidence that casinos have had a major impact on the
crime rates of towns or metropolitan areas in which they are located.”
In 2000, the Public Sector Gaming Study Commission
reached similar conclusions, finding "no link between gambling,
particularly casino-style gambling, and crime." In fact,
the 2000 report recognized that casinos are more of a crime deterrent
than an instigator. According to the report, " The security
on the premises of gambling facilities, the multiple layers of
regulatory control, and the economic and social benefits that
gambling seems to offer to communities are effective deterrents
to criminal activity.”
In fact, a Harvard University study done in 2001
found rates of certain crimes actually fell in areas surrounding
tribal casinos. Plus, the US Department of Justice has found no
evidence of an organized crime element in the Indian gaming industry
after years of investigation.
Statements by law enforcement agents in gaming
jurisdictions across the country also refute critics’ claims
that gaming causes crime. Twenty-four sheriffs and chiefs of police
submitted their findings to the National Gambling Impact Study
Commission (NGISC), stating there was no connection between gaming
and crime in their jurisdictions.
As for the issue of decreased property values,
there is little documented evidence supporting the argument that
casinos cause reductions in property values.
As for the issue of decreased property values,
there is little documented evidence supporting the argument that
casinos cause reductions in property values.
.
Is the Indian gaming industry regulated?
Tribal governments are going to extraordinary
lengths to protect the economic operations that support their
people and employ hundreds of thousands of Americans. Nationwide,
tribes spend almost $300 million to regulate Indian gaming, including
$228 million at the tribal level, $55 million at the state level
and $12 million at the federal level.4*
Tribal government gaming is subject to more stringent
regulation and security controls than any other type of gaming
in the United States. The regulation of tribal gaming operations
occurs at three distinct levels of government -- tribal, state
and federal -- and includes oversight from the National Indian
Gaming Commission and other federal agencies such as the U.S.
Justice Department, the FBI, the IRS and the Bureau of Indian
Affairs.
Tribal regulators are experienced law enforcement
officers and professionals, such as former FBI agents, state SWAT
team members, tribal police, and state regulators. Overall, there
are some 3,350 tribal gaming regulators in force today.
Compacts between states and tribes give states
some regulatory power over tribal government gaming, though IGRA
recognizes that the federal government has primary responsibility
for government-to-government relations with sovereign Indian nations.
For more information about
Indian gaming regulation, click here.
Aren’t investors
getting most of the money from Indian gaming?
The federal Indian Gaming Regulatory Act clearly states that the
majority of tribal government gaming revenue must go to:
• Tribal government operations or programs
• The general welfare of the Indian tribe and its members
• Promoting tribal economic development
• Donations to charitable organizations
• Helping fund operations of local government agencies
Investors receive only a small percentage of overall annual revenues
from gaming operations as reimbursement for their investment.
Isn’t Indian gaming contributing to
problem gambling?
Tribes thoroughly train their gaming employees
to recognize the signs of compulsive or problem gambling and provide
ongoing support to clientele, as well as to organizations offering
assistance to problem gamblers and their loved ones. Overall,
tribes throughout the country give tens of millions of dollars
annually to problem gambling programs.
While some people assume that gambling disorders
will increase if there is an expansion of gambling, the research
indicates that this is not true. With commercial and Native American
casinos operating in approximately 30 states, gambling participation
rates doubling and consumer spending exceeding $40 billion annually,
the National Gambling Impact Study Commission (NGISC) in 1999
determined that the 0.6 percent of pathological gamblers has remained
the same.
Additionally, the National Opinion Research Center
of the University of Chicago completed the first-ever national
(U.S.) survey on problem gambling prevalence in 1999. The study
found that approximately 0.9 percent of the population exhibited
problem gambling behavior.
Don’t Indian casinos have a negative
impact on the environment?
Tribes must comply with National Environmental
Policy Act guidelines when building and operating their facilities.
They must submit comprehensive and exhaustive studies and documentation
examining all environmental elements, including traffic, water,
wastewater, wetlands, waterways, cultural resources, coastal zones,
endangered species, environmental justice and socioeconomic conditions,
that could be affected by the proposed facility.
In California, compacts negotiated and signed
since 2003 also call for strict adherence to California Environmental
Quality Act guidelines with the construction of any new gaming
facility.
Tribes work diligently to minimize any and all foreseeable impacts.
In an effort to be good neighbors, the vast majority of tribes
go directly to local communities and listen to their concerns
and opinions before embarking on any course of action.
For landless tribes, the process is even more
complex. Before a tribe can break ground, it must submit what
is called a fee-to-trust application to the federal Bureau of
Indian Affairs, which must meet the requirements of the Code of
Federal Regulations for land acquisitions, BIA policy manuals,
and other applicable federal statutes.
The application is extremely comprehensive, and contains many
elements including exhaustive environmental documentation, historical
and regulatory paperwork, and other important items.
Why gaming? Why can’t tribes try some
other business?
Tribes have explored a lot of different economic
development strategies over the years, but none of them comes
close to the benefits afforded by Indian gaming. The truth is
many tribes are located in remote and desolate areas, away for
major urban centers. Without a solid, market-tested business plan,
tribes cannot attract the kind of outside investment they need.
Tribes need economic development to generate
revenue to care for their people. Tribal government gaming allows
tribes to provide services their people need, including housing,
healthcare, educational and vocational opportunities, and proper
care for elders, while giving them the ability to preserve and
protect their history, culture and traditions for future generations.
There is little chance tribes could attract serious
investment to build something like mini-marts or gas stations.
While those businesses are fine, Indian gaming offers long-term
job growth, revenue generation and immediate benefit to the local
and regional economy. It is a rapidly growing industry and will
continue to grow in the future. Investors are always looking for
industries and businesses with this kind of long-term growth
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