1). In fiscal year  2012, about 240 of the 566 federally recognized tribes operated more  than 420 Indian gaming establishments across 28 states. These  establishments included a broad range of operations, from tribal bingo to  multimillion dollar casino gaming facilities. IGRA is the primary federal statute governing Indian gaming.provides, among other things, a statutory basis for the regulation of Indian  gaming to shield it from corrupting influences, assure that gaming is  conducted fairly and honestly by both the operators and the players, and  ensure that tribes are the primary beneficiaries of gaming operations. Interior Uses a Multistep Review Process to Help Ensure That Compacts Comply with IGRA

Interior has a multistep review process that helps to ensure that compacts  comply with relevant IGRA provisions and other applicable laws. While  compacts approved by Interior share similar provisions, they do vary in  some respects, such as the terms of “revenue sharing” arrangements  between states and tribes and the extent to which the compact addresses  tribal interactions with local governments. Variety of Provisions Contained in Compacts Approved by Interior

The compacts approved by Interior share similar provisions but vary in  some respects. In contrast, some compacts require the tribe to share  significant portions of revenue with the state. Based on our preliminary observations of ongoing  work, we found that the approaches of the three states we have visited to  regulating Indian gaming vary, as seen through differences in their  regulatory agencies’ organization, staffing levels, and funding. For the  seven tribes we have visited, each has established tribal gaming  regulatory agencies that govern the day-to-day operations of their gaming  facilities. Compacts and Tribal Gaming Ordinances Establish the Roles of States and Tribes

The roles of states and tribes in regulating Indian gaming vary and are  established in two key documents: (1) compacts for Class III gaming and  (2) tribal ordinances for both Class II and Class III gaming. Each of the seven tribes we visited in Arizona, California, and Oklahoma  for our preliminary observations have established tribal gaming regulatory  agencies—also called tribal gaming commissions or tribal gaming  agencies—that perform various regulatory functions to ensure that their  gaming facilities are operated in accordance with tribal laws and  regulations and, for Class III operations, the compact. The Commission’s Regulation and Oversight of Indian Gaming and Impacts of Recent Reorganization

The Commission plays an important role in regulating Class II gaming  and overseeing Class III gaming to ensure compliance with IGRA and  applicable federal and tribal regulations. Among other things, the  Commission monitors Class II gaming, inspects Class II gaming  premises, and takes enforcement actions when necessary. In 2011, the  Commission implemented its Assistance, Compliance, and Enforcement  (ACE) initiative, which emphasizes providing assistance to tribes to  achieve compliance with IGRA. Through this initiative, the Commission  has sought to provide technical assistance and training to tribes so that  compliance issues may be resolved early and voluntarily without the need  for a Notice of Violation, which we refer to as an enforcement action. According to Commission officials, this merger was deemed  necessary, in part, to better support the Commission’s emphasis on  compliance assistance under its ACE initiative. The Commission also tracks tribal compliance with what it defines as  eight primary obligations under IGRA, which are obtaining a compact approved by Interior prior to conducting Class III  submitting investigative reports and suitability determinations on each  key employee and primary management official, summarizing the  results of the tribal background investigation;  submitting fingerprint cards to the Commission for processing;  submitting gaming employee applications to the Commission at the  commencement of employment; adopting a gaming ordinance for Class II or Class III gaming that has  been approved by the Commission; paying a fee assessment to the Commission based on gaming  issuing a separate license for each facility where gaming is  conducted; and  submitting an annual independent audit of each Class II gaming  operation to the Commission. We are continuing to collect and  analyze data related to the Commission’s regulations and oversight of  Indian gaming, and we will present that information in our final report. The Commission’s Reorganization Appears to Align with Its Emphasis on Compliance Assistance

In 2011, as part of a broader organizational realignment, the Commission  merged its Enforcement and Audits divisions into one Compliance  Division. According to Commission officials, this merger was deemed  necessary, in part, to better support the Commission’s emphasis on  compliance assistance through its ACE initiative.
Why GAO Did This Study

Over the past 25 years, Indian gaming has become a significant source of revenue for many tribes, reaching $27.9 billion in 2012. At that time, about 240 of the 566 federally recognized tribes operated more than 420 gaming establishments ranging from bingo halls to multimillion dollar casinos across 28 states. IGRA, the primary federal statute governing Indian gaming, provides, among other things, a statutory basis for the regulation of Indian gaming to assure that it is conducted fairly and honestly. Tribes, states, Interior, and the National Indian Gaming Commission have roles in regulating or overseeing Indian gaming.
This testimony is based on GAO's preliminary observations from ongoing work that examines (1) the process Interior uses to ensure compliance with IGRA through its review of tribal-state compacts and the types of provisions contained in these compacts; (2) how states and selected tribes regulate Indian gaming; and (3) how the Commission regulates and oversees Indian gaming and how, if at all, recent organizational changes have affected its regulatory or oversight approach.
In its ongoing work, GAO analyzed compacts; visited three states and seven tribes (selected for geographic representations and revenue generation) to discuss the oversight of Indian gaming; reviewed Commission data on technical assistance and enforcement actions; and interviewed Interior and Commission officials. GAO will continue to collect information on these topics and produce a final report.
GAO is not making any recommendations in this testimony.

What GAO Found

The Department of the Interior (Interior) has a multistep review process designed to help ensure that compacts comply with the Indian Gaming Regulatory Act (IGRA). Such compacts are agreements between a tribe and state that governs the conduct of the tribe's Class III (or casino) gaming activities. Based on GAO's preliminary review, Interior has approved 78 percent (382) of the tribal-state compacts submitted since 1998. While the provisions in compacts approved by Interior are largely similar, they do vary in some respects, such as the terms of “revenue sharing” arrangements established between states and tribes. For example, some compacts do not provide for revenue sharing with states, while some require tribes to share significant portions of revenue with states. The remaining 22 percent (106) of compacts reviewed were either (1) considered approved without action by the Secretary of the Interior, (2) withdrawn, or (3) disapproved by Interior for various reasons, such as when they were not consistent with IGRA.
The roles of states and tribes in regulating Indian gaming vary and are established in two key documents: (1) compacts for Class III gaming and (2) tribal gaming ordinances, which provide the general framework for day-to-day tribal regulation of Class II (including bingo) and Class III gaming facilities. Based on GAO's preliminary observations of ongoing work, GAO found that the three states visited—Arizona, California, and Oklahoma—varied in their approaches to regulating Indian gaming, as seen through differences in their regulatory agencies' organization, staffing levels, and funding. For the seven tribes GAO visited, each has established tribal gaming commissions that perform various regulatory functions to help ensure that their gaming facilities are operated in accordance with tribal laws and regulations and, for Class III operations, the compact.
The National Indian Gaming Commission (Commission), an independent commission created by IGRA within Interior, plays an important role in regulating and overseeing Indian gaming by ensuring that Class II and Class III gaming facilities comply with IGRA and applicable federal regulations and tribal ordinances or resolutions. Among other things, the Commission monitors tribal gaming activities, inspects gaming premises, and takes enforcement actions when necessary. In 2011, the Commission implemented its Assistance, Compliance, and Enforcement initiative, which emphasizes providing assistance to tribes to achieve compliance with IGRA. Through this initiative, the Commission has sought to provide technical assistance and training to tribes so that compliance issues may be resolved early and voluntarily without the need for enforcement actions. According to Commission officials, in part, as a result of this initiative, the number of enforcement actions has decreased significantly. Also in 2011, as part of a broader organizational realignment, the Commission merged its Enforcement and Audits divisions into one Compliance Division. According to Commission officials, this merger was deemed necessary, in part, to better support the Commission's emphasis on compliance assistance under its initiative.