IGA Tradeshow: Class II gaming kicks off Indian Gaming Tradeshow

March 28, 2023 5:49 PM
Photo: CDC Gaming Reports
  • Buck Wargo, CDC Gaming Reports
March 28, 2023 5:49 PM
  • Buck Wargo, CDC Gaming Reports

Class II gaming on tribal lands took the spotlight Monday afternoon as the Indian Gaming Tradeshow & Convention kicked off in San Diego.

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More tribes are looking to convert from Class III gaming – the slot machines, table games, and other-casino style games under compacts with state government – to Class II that allow for bingo and non-banked games by dealing directly with the National Indian Gaming Commission for oversight.

That means no longer paying state gaming taxes and state oversight when there other gaming equipment mimics Class III performance and can generate more revenue. Even tribes that have Class III gaming are adopting more Class II machines because of the revenue.

One high-profile case of note is the Rincon Band of Luiseño Indians in California, who announced in January that they’re pulling out of Class III gaming.

“We call Class II the ‘escape valve for Indian Country for bad deals,’” said Victor Rocha, conference chairman for the Indian Gaming Association, in giving the first keynote address at this week’s activities at the San Diego Convention Center. “By that I mean the freedom it gives us, because we don’t have to do a compact. It’s one of the most important tools in our quiver. We Native Americans and tribal-gaming people are seeing so many restrictions and so many people out there trying to slow down our success that Class II provides an alternative road to success.”

Class II offers the tribes the ability to have gaming without dealing with the “whims of the changing client of our local communities, counties, and cities,” Rocha said. At one moment, tribes may have a good relationship with county commissioners, but at another point when there’s a changeover of members, there may be people who are “aggressive against our expansion. Class II gives us this ability to go forward in gaming.”

Rocha cited the example of Indiana, where there are no tribes, but the Pokagon Band of Potawatomi Indians went back to their ancestral land and opened a Class II casino in South Bend. If gaming is allowed in a state, the tribes have the right to operate a casino under Class II without needing a state compact.

“They’re doing a hotel and have sports betting, and that would have never happened unless they persevered with Class II. That’s one of my favorite stories of Class II.”

Rocha, a member of the Pechanga Band of Indians in southern California, said that in 1995, his tribe had gray-market machines and couldn’t get a deal with the state after then-Gov. Pete Wilson said he wouldn’t do a deal unless the tribes signed the one he sought.

“Without Class II, we wouldn’t have had the resources to fight the state, plus attorneys to fight our case at all levels,” Rocha said.

Focusing on Class II gaming is so important because tribes are looking to offer sports betting and online gaming, but are restricted by the Indian Gaming Regulatory Act passed by Congress in 1988, along with being restricted by the states, Rocha said.

“You’re starting to see revolutionary ideas for Class II,” Rocha said. “We’re starting to look at Class II sports betting and if that’s successful, it’s a game changer for the tribes.”