Executive View Q & A
Philip N. Hogen is chairman of the National Indian Gaming Commission, appointed to the role in the fall of 2002 by President Bush. He is also an enrolled member of the Oglala Sioux Tribe of the Pine Ridge Indian Reservation in South Dakota. Prior to his work with the NIGC, Hogen was associate solicitor for the Division of Indian Affairs, Office of the Solicitor, U.S. Department of the Interior, where he oversaw legal matters pertaining to the Bureau of Indian Affairs and Department of the Interior's fulfillment of its government-to-government relationship with Indian tribes, and its trust responsibilities to Indians and Indian tribes. Hogen joined the department in 2001 from the private practice of Indian law in Rapid City, S.D., where he was affiliated with the national law firm of Holland & Knight LLP. He has also served as an associate member and the vice chairman of the NIGC. His plate has been full of late, with the NIGC involved in a number of different issues on the political front that could significantly impact Indian Country. Casino Journal contributing writer Regina Lafay recently caught up with Hogen at Ascend Media's BingoWorld trade show and conference in Las Vegas, where he took time to talk about some of the NIGC's recent endeavors.
For those who may not know, can you explain the purpose and mission of the National Indian Gaming Commission?
The Indian Gaming Regulatory Act was passed in 1988. It passed to tribes the primary role and responsibility to regulate the gaming they were going to conduct. They were going to do bingo and non-bank card games if the state permitted. If they were going to do casino gaming, they would need to enter into a tribal state compact. But Congress also saw a need to have some federal standards established and have a federal entity that had oversight of all this gaming. So that's the role of the National Indian Gaming Commission-to keep track of the gaming that's out there, complying with the Indian Gaming Regulatory Act, while at the same time exercising the trustee responsibility that the United States has to Indian tribes-to make sure somebody isn't taking advantage of the tribes. As we do that, of course, we want to strengthen and bring integrity to the Indian gaming industry. It's out there, and I think we've contributed by validating the good job the tribes are doing at regulating the Indian gaming industry.
One of the things you've been working on of late is establishing Minimum Internal Control Standards. Can you explain what these involve and how things are progressing?
All gaming jurisdictions have some rules that you have to follow to make sure that the money is properly accounted for, the play of the games is fair, and that the folks who are working in the industry are suitable. When the National Gaming Commission got started we didn't have that rule book, so to speak, that yard stick with which to measure those performances. So in the late 1990s it occurred to NIGC that we needed to set some minimum standards so that our tribe can comply with that level, and we can go out and monitor that. At that time many tribes were head and shoulders above that minimum, but a number of them weren't. So this gave guidance. That was in 1999.
Technology rapidly changes in the gaming industry, as you know, and you can't just write a set of rules once and be done. We have to periodically revise the MICS. One of the current revisions we're working on has to do with digital surveillance systems. The MICS as they exist now address analog systems, which was all there was in 1999. Those are the kind of things we have to do to keep things current. We have a tribal advisory committee that assists us in putting those together. Hopefully they will strengthen the industry and give guidance to the tribal gaming regulators.
In recent years-from several states' "not paying their fair share" debate to the recent Jack Abramoff scandal-Indian Country has gotten somewhat of a black eye in the area of perception. What can gaming tribes do to improve their perception among the general public?
Tribes need to continually work to tell the true story. Indian gaming is governmental gaming, just like the state lottery where all of the proceeds go to governmental purposes. So to say that they aren't paying their fair share is not an appropriate criticism. A tribe has its own governmental needs. They need to explain the good things they are doing with those dollars. They're building schools, hospitals, improving housing and the environments on reservations. In terms of this lobbying campaign contribution scandal, I think it's important that tribes make sure they know who they're hiring to represent them.
The issue of taking off-reservation land into trust by gaming tribes has become a hot-button issue. What's your take? Should tribes be allowed to do so, or do you favor moratoriums that have been proposed?
If we could start over, a lot of Indians wouldn't part with their land, and they'd still be where they wanted to be and that's where they would do their gaming. Unfortunately, in the advancement of civilization, so to speak, a lot of Indians lost their land and ended up somewhere they didn't want to be. Indians that are involved in Indian gaming right now are making that work on their homelands. There have only been a few instances where they've gone "off-reservation," and those were with the blessings of the state governments. I don't think it's the problem that some perceive it to be.
The more challenging situation is for those tribes who did get displaced. They need to find their initial lands and restore what they had in the past without unduly disrupting what is going on in the outward society.
There are some, like Sen. John McCain, who say the IGRA should be overhauled. Do you agree or disagree with that sentiment? What parts of the Act, if any, would you like to see changed?
I agree that we've got an industry that started out really small and grew very big. Fifteen years have passed, so it's appropriate to stand back and see if some things should be adjusted. We at the NIGC have encountered situations where the law doesn't exactly fit anymore. We believe it's appropriate to carefully and cautiously review the Act.
From the perspective of the NIGC, the most important part that's under discussion for change right now would be clarifying the role NIGC has with respect to Class III gaming. I don't know that when the Act was written the authors anticipated that Class III gaming would represent over 80 percent of total revenue.
There was a recent court decision that challenges the NIGC's role in regard to Class III. When we enacted those MICS back in 1999, it applied to Class II and Class III. I think it's worked beautifully. To suddenly say, 'no you can't do that,' would put the industry at risk. If we could clarify that and can keep doing what we've been doing since 1999, that would be useful.
There's another change that should occur. We do an approval of management contracts when developers build around casinos of tribes. Those contracts only apply to Class III gaming, so we think we need a clarification to address Class II gaming as well.
What are the other issues the NIGC is working with at the moment?
The main issue we're dealing with is defining the difference between Class II and Class III gaming. With the advancement of technology-server based gaming, bingo player stations-it's becoming more and more difficult for some to tell the difference. The Justice Department is going to promote legislation which would amend the Johnson Act, which says that you can't have gambling devices in Indian Country. We very much support that because we need clarification in this area. Right now it's hard for us to go out and tell tribes and manufacturers this is what you can and can't do because of a lack of clarity in the law. If we get that clarity, the NIGC could have regulations of what you can do in a compact, and what you cannot.