With a new year, new fiscal budgets approved and a slow but steady debt market recovery underway, many tribal nations are seeking to expand their gaming facilities. Whether building a brand-new (“greenfield”) casino or adding on to an existing facility, the steps taken and the order of those steps in pulling together the team, planning, scope and budget are critical.
In 1988 when the Indian Gaming Regulatory Act (IGRA) was approved by Congress, both legislators and tribal leaders intended its purpose to further the economic development of tribal governments and envisioned that gaming should not serve as an end unto itself, but as a means toward additional growth and expansion for the nations.
The Indian country press is filled with articles and stories extolling the virtues of tribal economic development, with many of those articles focusing on the need for, and benefits of, diversification of the tribal economic base. It is hard to argue with the wisdom of such advice, and few, if any, tribal leaders or tribal sovereignty advocates would take exception...
In Colorado River Indian Tribes v. NIGC (CRIT), 383 F. Supp. 2d 123 (D.D.C. 2005), the Colorado River Indian Tribes objected to the National Indian Gaming Commission’s (NIGC) audit of its Class III gaming operation. For Indian gaming attorneys, the CRIT decision evoked many questions that are yet to be answered.
I recently had the pleasure of serving as the financial advisor for the Mescalero Apache Tribe with regard to the exchange offer restructure of its $200 million 12 percent bonds for the Inn of the Mountain Gods, the tribe’s casino resort property. It was a long, much awaited, publicly visible process, as well as one of the first successful win-win restructurings of bond debt in Indian country, with both the bondholders and the tribe coming away extremely satisfied with the results.
During the last week of June 2011, a group of volunteers, including several National Indian Gaming Association (NIGA) associate members, traveled to Cass Lake, Minn., to assist White Earth Ojibwe Tribal enrollees with housing repairs/construction and medical assistance and the community at large with elders’ and children’s projects.
Earlier this year, I had the pleasure of participating in the tribal panel at the iGaming North America conference, which was held over a three-day period in Las Vegas. I decided to attend the entire conference and immersed myself into Internet/online gaming issues for a 48-plus hour period, hardly coming up for air. I came away with two epiphanies, as it were, on behalf of my tribal clients.
As both the tribal and commercial gaming sectors see the “light at the end of the tunnel” out of the recent financial market dislocation with cautious optimism for recovery, facilities once again are closing financings. The lender/investor deck has definitely been reshuffled with personnel at many banks and institutions.
I recently had the pleasure of participating on a financing panel during a Tribal Gaming Economic Development Summit. Although the discussion was immensely interesting, I realized that most of the audience members had glazed-over looks in their eyes. I realized we had completely lost our audience due to some financial terms we were using that were foreign to them.
One of the primary differences between tribal and commercial gaming is the structure of ownership. By definition under the Indian Gaming Regulatory Act, tribal casinos can only be owned by federally recognized American Indian tribal governments located on reservation land held in trust by the federal government.
