SAN DIEGO – A divisive debate by American Indian gaming tribes over Internet gambling ended April 8 with an anti-climatic vote to delay action on a resolution opposing and suggesting changes to proposed federal legislation to legalize online poker.

Tribal members of the National Indian Gaming Association voted 27-6 with one abstention to table what was intended as a compromise resolution in response to proposed bills by Rep. Barney Frank, D-Mass., and others to legalize and tax online poker.

While many tribal leaders in California view online wagering as potential competition to 440 tribal casinos in 28 states, others in the southern and eastern United States regard the Internet as an opportunity to grow their gambling and hospitality markets.

Still others in the Midwest and Southwest contend it is premature to take a position on the complex issue of Internet wagering, particularly since most believe Frank’s bill and similar legislation in the Senate stand little chance of passage. They apparently were the tribes who carried the vote to table the motion.

“I’m disappointed. Very, very much so,” Chairman Robert Martin of the Morongo Band of California Mission Indians said after the vote. His tribe hopes to both block Frank’s bill and establish an intrastate poker Web site. “I thought we had the votes to get it done,” he said of the draft NIGA resolution.

Chief Miko Beasley Denson of the Mississippi Band of Choctaw Indians was undoubtedly pleased at the result. “I want to know more. I don’t want to make a decision prematurely,” he said, suggesting a study be done to explore the impact online gambling would have on the tribal casino industry.

There is general agreement that legislation to legalize online gambling would have to recognize the sovereign status of tribal governments and not tax tribes or infringe on the right of tribes to operate casinos under terms established by the Indian Gaming Regulatory Act of 1988.

Martin contends Frank’s legislation does not allow tribes to extend their Web sites to potential customers living off tribal reservations. The bill, he said, would allow foreign operators and permit Web sites to offer gambling other than poker.

“No bill is a bigger threat to Indian gaming. Tribes must have a seat at the table or we’ll lose all we’ve fought for. We must not let Congress roll the dice on the future of Indian gaming.”

Frank has responded to tribal concerns. In a March 29 letter to NIGA Chairman Ernie Stevens, the congressman said, “I intend that this legislation should have no impact on (tribal) compacts with states; that is, the bill should not in any way impair existing rights regarding compacts either currently in force or to be signed in the future.”

Tribes have stepped back from a general belief that legalization of online gambling would cannibalize the nearly $27 billion tribal gambling market. Most online gamblers play poker or bet on sports. Tribes don’t offer sports betting and poker is a player-banked game that generates very little casino revenue.

Many tribes also believe Internet wagering could benefit the approximately 300 tribes and Alaska Native villages that do not operate casinos or bingo halls.

“I don’t believe gaming tribes are opposed to Internet gaming as much as the legislation,” said Mohegan Chairwoman Lynn Malerba.

Malerba acknowledges, however, that there are varying concerns and opinions about the competitive aspects of Internet wagering and the impact it could have on tribal-state gambling agreements, or compacts, as specified under IGRA.

There were about a half-dozen draft resolutions being circulated when NIGA members met April 8 afternoon to vote on the matter.

“Everybody’s comments are valid. Everybody’s concerns are valid,” Malerba said.

She suggested that the wise course of action would be to work with Frank’s office in crafting an Internet wagering bill.

“We’re looking to protect IGRA. We’re looking to protect tribal-state compacts. Why not help craft the language?”

Most of the members of the American Gaming Association, the lobby and trade association for the commercial casino industry, support online wagering but the organization has not taken a position on the proposed legislation.

The Federal Wire Act of 1961 prohibits interstate wagering through the use of telecommunications, but the act is rarely enforced and, some believe, does not apply to use of the Internet. The Unlawful Internet Gambling Enforcement Act of 2006 bans the use of credit cards in paying off online wagers. Existing law does not prohibit intrastate online wagering.

Martin and his supporters say tribes and the state are missing out on millions in online poker proceeds being generated by illegal Web sites operated out of South and Central America.

“We want to be out in front on this. It’s gaming, and we feel we have expertise in gaming. We’re not going to sit back and let all those dollars leave the state.”

But other California tribes believe intrastate poker would violate the tribal exclusivity on casino gambling written into tribal-state agreements, or compacts. Those agreements guarantee the state a “revenue share” of casino profits amounting to $365 million a year, far more than the $30 million to $50 million a year that the most optimistic supporters contend will be generated with online poker.


Dave Palermo is an award-winning writer, editor and media consultant. He can be reached at dgpalermo@aol.com.