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Rule2024-03456

Class III Tribal State Gaming Compacts

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Published

February 21, 2024

Effective

March 22, 2024

Issuing agencies

Interior DepartmentIndian Affairs Bureau

Abstract

The Department of the Interior (Department) is issuing revisions to its regulations governing the review and approval of Tribal-State gaming compacts. The revisions add factors and clarify how the Department reviews "Class III Tribal-State Gaming Compacts" (Tribal-State gaming compacts or compacts).

Full Text

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<title>Federal Register, Volume 89 Issue 35 (Wednesday, February 21, 2024)</title>
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[Federal Register Volume 89, Number 35 (Wednesday, February 21, 2024)]
[Rules and Regulations]
[Pages 13232-13260]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-03456]

[[Page 13231]]

Vol. 89

Wednesday,

No. 35

February 21, 2024

Part III

Department of the Interior

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Bureau of Indian Affairs

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25 CFR Part 293

Class III Tribal State Gaming Compacts; Final Rule

Federal Register / Vol. 89 , No. 35 / Wednesday, February 21, 2024 /
Rules and Regulations

[[Page 13232]]

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DEPARTMENT OF THE INTERIOR

Bureau of Indian Affairs

25 CFR Part 293

[245A2100DD/AAKC001030/A0A501010.999900]
RIN 1076-AF68

Class III Tribal State Gaming Compacts

AGENCY: Bureau of Indian Affairs, Interior.

ACTION: Final rule.

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SUMMARY: The Department of the Interior (Department) is issuing
revisions to its regulations governing the review and approval of
Tribal-State gaming compacts. The revisions add factors and clarify how
the Department reviews ``Class III Tribal-State Gaming Compacts''
(Tribal-State gaming compacts or compacts).

DATES: This rule is effective on March 22, 2024.

FOR FURTHER INFORMATION CONTACT: Oliver Whaley, Director, Office of
Regulatory Affairs and Collaborative Action (RACA), Office of the
Assistant Secretary--Indian Affairs; Department of the Interior,
telephone (202) 738-6065, <a href="/cdn-cgi/l/email-protection#b1e3f0f2f0f1d3d8d09fd6dec7"><span class="__cf_email__" data-cfemail="580a191b19183a3139763f372e">[email&#160;protected]</span></a>.

SUPPLEMENTARY INFORMATION: This final rule is published in exercise of
authority delegated by the Secretary of the Interior to the Assistant
Secretary--Indian Affairs (Assistant Secretary; AS-IA) by 209 DM 8.

Table of Contents

I. Statutory Authority
II. Executive Summary
III. Background
IV. Summary of Comments Received
A. General Comments
B. Section Comments
V. Summary of Changes by Section
A. Proposed Subpart A--General Provisions and Scope
B. Proposed Subpart B--Submission of Tribal-State Gaming
Compacts
C. Proposed Subpart C--Secretarial Review of Tribal-State Gaming
Compacts
D. Proposed Subpart D--Scope of Tribal-State Gaming Compacts
VI. Procedural Requirements
A. Regulatory Planning and Review (E.O. 12866)
B. Regulatory Flexibility Act
C. Congressional Review Act (CRA)
D. Unfunded Mandates Reform Act of 1995
E. Takings (E.O. 12630)
F. Federalism (E.O. 13132)
G. Civil Justice Reform (E.O. 12988)
H. Consultation With Indian Tribes (E.O. 13175)
I. Paperwork Reduction Act
J. National Environmental Policy Act (NEPA)
K. Effects on the Energy Supply (E.O. 13211)
L. Clarity of This Regulation
M. Public Availability of Comments

I. Statutory Authority

In enacting the Indian Gaming Regulatory Act of 1988 (Pub. L. 100-
497) 102 Stat. 2467 dated October 17, 1988, (Codified at 25 U.S.C.
2701-2721 (1988)) (hereinafter IGRA), Congress delegated authority to
the Secretary to review compacts to ensure compliance with IGRA, other
provisions of Federal law that do not relate to jurisdiction over
gaming on Indian lands, and the trust obligations of the United States.
25 U.S.C. 2710(d)(8)(B)(i)-(iii).

II. Executive Summary

The Department of the Interior (Department) is issuing revisions to
its regulations located at 25 CFR part 293, which govern the
Department's review and approval of Tribal-State gaming compacts under
IGRA. The final rule includes revisions to the Department's existing
part 293 regulations and adds provisions clarifying how the Department
reviews ``Class III Tribal-State Gaming Compacts'' (Tribal-State gaming
compacts or compacts).
The Department's current regulations do not identify the factors
the Department considers when reviewing a compact; rather, those
factors are contained in a series of letters issued by the Department
dating back to 1988. Evolution in the gaming industry and ongoing
litigation highlight the need for the Department to clarify how it will
analyze Tribal-State gaming compacts to determine whether they comply
with IGRA, 25 U.S.C. 2701, et seq., other provisions of Federal law
that do not relate to jurisdiction over gaming on Indian lands, and the
trust obligations of the United States to Indians.

III. Background

In the early 1970s, as part of the Federal shift away from the
termination era policies towards Tribal self-governance, Federal
support grew for Indian gaming as a means of generating revenue for
Tribal governments. During that period, the United States was taking
affirmative steps to encourage Tribal gaming operations as a way for
Tribes to improve self-governance by reducing their dependence on
Federal funds.\1\ In response, States began to take police and
regulatory based legal actions in an attempt to restrain Tribal
gaming.\2\ Then, in 1987, the Supreme Court issued its Cabazon
decision, effectively holding that Tribes have the exclusive right to
regulate gaming activities on Indian lands, provided that gaming is not
prohibited by Federal law, and the State permits such gaming. Cabazon,
480 U.S. 202.
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\1\ California v. Cabazon Band of Mission Indians, 480 U.S. 202,
217 (1987) (Cabazon).
\2\ See Cohen's Handbook of Federal Indian Law, 2012 edition,
sec. 12.91 The Emergence of Gaming.
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One year later, Congress enacted IGRA, which acknowledged that many
Tribes were already engaged in gaming and placed limits on Tribes'
sovereign right to conduct gaming. The IGRA divided gaming into three
classes. Class I gaming includes social games for prizes of minimal
value and traditional forms of Indian gaming that are engaged in as
part of Tribal ceremonies and celebrations. 25 U.S.C. 2703(6) and 25
CFR 502.2. Class II gaming includes bingo and bingo like games as well
as non-house banked card games for example traditional poker. 25 U.S.C.
2703(7) and 25 CFR 502.3. Class III gaming includes all other forms
including: house backed card games, for example baccarat or blackjack;
casino games for example roulette and craps; slot machines; sports
betting and parimutuel wagering including horse racing; and lotteries.
25 U.S.C. 2703(8) and 25 CFR 502.4. Congress through IGRA sought to
ensure that Tribes are the primary beneficiaries of Indian gaming
operations, but also authorized State governments to play a limited
role in the regulation of class III Indian gaming by negotiating
agreements with Tribes called ``Class III Tribal-State Gaming
Compacts'' (class III gaming compacts or compacts). Class III gaming
compacts govern the conduct of class III gaming on the Indian lands of
the Tribe by providing the jurisdictional framework for the licensing
and regulation of the class III gaming. Congress sought to strike a
balance between Tribal sovereignty and States' interests in regulating
gaming and ``shield[ing] it from organized crime and other corrupting
influences.'' 25 U.S.C. 2702(2).
With IGRA, Congress sought to balance State interests while
safeguarding Tribes against aggressive States by providing a specific
list of permissible topics in a compact and requiring States to
negotiate in good faith.\3\ In addition to the good faith negotiation
requirements and the limited list of permissible topics, Congress also
provided both judicial remedies and administrative oversight in the
form of Secretarial review. Congress provided the United States
district courts with jurisdiction over causes of action stemming from
IGRA's requirement that States enter into negotiations with Tribes who
request

[[Page 13233]]

negotiations, and that the State negotiate in good faith. 25 U.S.C.
2710(d)(7)(A)(i). Under IGRA, the district courts review the
negotiation process which often includes reviewing if the negotiations
have strayed beyond IGRA's limited list of permissible topics in a
compact. The Secretary's review of a compact begins after the parties
have executed the compact and necessarily includes reviewing if it
contains terms that strayed beyond IGRA's limited list of permissible
topics in a compact.
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\3\ Chicken Ranch Rancheria v. California, 42 F.4th 1024 (9th
Cir. 2022).
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Congress expressly included ``the trust obligations of the United
States to Indians'' as part of the Secretary's review of a compact.\4\
In that respect, IGRA's use of the term trust obligation invokes the
broader general government-to-government trust relationship to Tribes,
not a specific fiduciary trust duty. These provisions in IGRA support
the application of the government-to-government trust relationship, as
well as its protection of Tribal sovereignty, to IGRA's carefully
balanced encroachment into Tribal sovereignty. It is, therefore,
appropriate for the Department to consider the general government-to-
government trust relationship and protect Tribal sovereignty during its
review of compacts. Further, this rulemaking upholds the government-to-
government trust relationship by codifying longstanding Departmental
policy and interpretations of caselaw addressing IGRA's limited list of
permissible topics in a compact. The final rule will ensure Tribes have
the tools they need to protect themselves against further encroachment
by aggressive States that insist on including compact provisions that
are not directly related to the operation of gaming activities. The
final rule provides clarity by articulating the Department's ``direct
connection'' test and by giving examples of provisions the Department
has found are directly connected to a Tribe's operation of gaming
activities and of provisions that do not meet this test. Some examples
of improper provisions States have sought to require include requiring
compliance with State tobacco regulations; requiring memoranda of
understanding with local governments; adopting State environmental
regulations of projects that are not directly related to the operation
of gaming activities; or regulating non-gaming Tribal economic
activities.
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\4\ 25 U.S.C. 2710(d)(8)(B)(iii).
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At the time of IGRA's enactment, Indian gaming represented an
approximately $121 million segment of the total United States gaming
industry, while Nevada casinos reported approximately $4.1 billion in
gross gaming revenue.\5\ By the end of fiscal year 2022, Indian gaming
represented an approximately $40.9 billion segment of the total United
States gaming industry, with commercial gaming reporting approximately
$60.4 billion.\6\ In the Casino City's 2018 Edition of the Indian
Gaming Industry Report, Allen Meister, Ph.D., of Meister Economic
Consulting estimated that in 2016, Indian Gaming represented a total
economic contribution of $105.4 billion across the U.S. economy.
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\5\ See, e.g., ``The Economic Impact of Tribal Gaming: A State-
By-State Analysis,'' by Meister Economic Consulting and American
Gaming Association dated November 8, 2018.
\6\ See, e.g., ``The National Indian Gaming Commission's annual
gross gaming revenue report for 2022;'' see also American Gaming
Association's press release ``2022 Commercial Gaming Revenue Tops
$60B, Breaking Annual Record for Second Consecutive Year.''
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In line with the growth in Indian gaming, State licensed commercial
gaming and State lotteries have also experienced growth. When Congress
began considering legislation addressing Indian gaming in the early
1980s, two States had legalized commercial casino gaming and seventeen
had State run lotteries. By 2017, 24 States had legalized commercial
casino gaming, resulting in approximately 460 commercial casino
locations, excluding locations with State licensed video lottery
terminals, animal racetracks without gaming machines, and card rooms.
In 2017, the gross gaming revenue for the commercial casino industry
represented approximately $40.28 billion and generated approximately
$9.2 billion in gaming tax revenue. Further, 44 States were operating
State lotteries in 2017.
The expansion of State lotteries and State licensed commercial
gaming can place Tribes and States in direct competition for market
share. Advancements in gaming technology and changes in State and
Federal gaming law since the passage of IGRA have consequently shaped
the compact negotiation process. As a result, class III gaming compacts
have expanded in scope and complexity as the parties seek mutually
beneficial provisions. IGRA, however, anticipated the compact
negotiation process would be between sovereign governments seeking to
regulate and safeguard Indian gaming, an arrangement protected by
judicially enforceable limits on the provisions a State could seek to
include in a compact.
Through IGRA, Congress diminished Tribal sovereignty by requiring
Tribes to enter into compacts with States governing the Tribes' conduct
of class III gaming before Tribes may conduct casino style or ``class
III gaming.'' 25 U.S.C. 2710(d)(1)(C). IGRA requires States to
negotiate class III gaming compacts in good faith, limits the scope of
negotiation for class III gaming compacts to seven enumerated subjects,
and prohibits States from using the process to impose any tax, fee,
charge, or other assessment on Tribal gaming operations. 25 U.S.C.
2710(d)(3)(A); 2710(d)(3)(C); and 2710(d)(4). However, States have
often sought to include provisions in compacts which test the limits
Congress provided in IGRA. Tribes have sought both judicial and
administrative relief resulting in a body of case law and
administrative decisions clarifying the proper scope of compacts.
Under IGRA, the Department has 45 days to complete its review and
either approve or disapprove a class III gaming compact. 25 U.S.C.
2710(d)(8). If the Department takes no action within that 45-day
period, the Tribal-State gaming compact is considered approved by
operation of law--to the extent that it is consistent with IGRA. 25
U.S.C. 2710(d)(8)(C). In order for a compact to take effect, notice of
its approval or approval by operation of law must be published in the
Federal Register. 25 U.S.C. 2710(d)(3)(B).
The regulations that codify the Department's review process for
Tribal-State gaming compacts are found at 25 CFR part 293 and were
promulgated in 2008 (``2008 Regulations''). 73 FR 74004 (Dec. 5, 2008).
The Department's 2008 Regulations were designed to ``address[ ] the
process for submission by Tribes and States and consideration by the
Secretary of Class III Tribal-State Gaming Compacts, and [are] not
intended to address substantive issues.'' 73 FR 74004-5. The
Department's consideration of substantive issues appears in decision
letters, ``deemed approved'' letters, and technical assistance letters.
In addition, a body of case law has developed that addresses the
appropriate boundaries of class III gaming compacts. With this final
rule, the Department codifies longstanding Departmental policies and
interpretation of case law in the form of substantive regulations,
which will provide certainty and clarity on how the Secretary will
review certain provisions in a compact.
On March 28, 2022, the Department published a Dear Tribal Leader
Letter announcing Tribal consultation regarding proposed changes to 25
CFR part 293, pursuant to the Department's consultation policy and
under the criteria in E.O. 13175. The Department held two listening
sessions and four

[[Page 13234]]

formal consultation sessions. The Department also accepted written
comments until June 30, 2022.
The Dear Tribal Leader Letter included a Consultation Draft of the
proposed revisions to 25 CFR part 293 (Consultation Draft); a
Consultation Summary Sheet of Draft Revisions to part 293; and a
redline reflecting proposed changes to the 2008 Regulations. The Dear
Tribal Leader Letter asked for comments on the Consultation Draft, as
well as responses to seven consultation questions.
The Department received numerous written and verbal comments from
Tribal leaders and Tribal advocacy groups. The Department also received
written comments from non-Tribal entities, which are not addressed in
the Tribal consultation comment and response. The Department has
included and addressed those comments as part of the public comment
record for the proposed rule.
On December 6, 2022, the Department published a notice of proposed
rulemaking announcing the public comment period for the proposed
revisions to 25 CFR part 293 (proposed rule). 87 FR 74916. The
Department published a Dear Tribal Leader Letter dated December 5,
2022, announcing a second round of Tribal consultation sessions on the
proposed rule. The Department also published a redline version of the
proposed rule reflecting changes to the 2008 Regulations, a redline
version reflecting changes made in response to Tribal consultation
comments, and a Table of Authorities identifying case law and
Departmental decisions and other policy statements considered when
drafting the proposed rule. The Department held one in-person Tribal
consultation and two virtual Tribal consultation sessions. The
Department also accepted written comments until March 1, 2023. Over 56
entities commented on part 293, including Tribal, State, and local
governments, industry organizations, and individual citizens. In total,
the submissions were separated into 607 individual comments. Generally,
around 258 comments were supportive, 136 were not supportive, and 213
were neutral or provided constructive criticism.

IV. Summary of Comments Received

A. General Comments

Several commenters commented on the process and timing of the
proposed rulemaking process. Some commenters requested additional time
to comment and further consultations or listening sessions during the
rulemaking process. Other commenters requested detailed records of the
government-to-government Tribal consultation sessions held between
March 28 and June 30, 2022. Others encouraged the Department to proceed
with the rulemaking expeditiously.
The Department acknowledges the comments. The Department seeks to
balance robust consultation and public participation with expeditious
processing of the rulemaking. The Department held two virtual
consultation sessions, one in-person listening session, and provided an
85-day public comment period on the proposed rule. The final rule
reflects public input on the proposed rule and builds on the input of
Tribal leaders from the government-to-government Tribal consultation
process.

B. Section Comments

Comments on Sec. 293.1--What is the purpose of this part?
Several commenters expressed support for the proposed amendments to
Sec. 293.1 and some commentors noted it is helpful that the Department
states the regulations contain substantive requirements for class III
compacts.
The Department acknowledges the comments.
Comments on Sec. 293.2--How are key terms defined in this part?
Many commenters expressed support and approval for the proposed
amendments to existing definitions and the proposed new definitions--
including, but not limited to, ``gaming facility,'' ``gaming spaces,''
``amendment,'' and ``meaningful concession.''
The Department acknowledges the comments.
One commenter suggested the Department include a definition for
``primary beneficiary'' as the term is used in Sec. 293.25(b)(3) \7\
of the proposed rule, noting that the current version suggests that
this be measured against projected revenue to the Tribe and State but
that market circumstances often change. One commenter requested
additional defined terms and clarified definitions. Requested
definitions include: ``Beneficiary,'' ``Projected Revenue,'' and
clarification of the difference (if any) between ``great scrutiny'' and
``strict scrutiny.''
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\7\ The Department notes Sec. 293.25 has been redesignated as
Sec. 293.27 in the final rule.
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The Department declines to accept the recommendation to define
``primary beneficiary.'' The IGRA sets a benchmark that requires the
Tribe receive at least 60 percent of net revenue. The National Indian
Gaming Commission relies on Sole Proprietary Interest and IGRA at 25
U.S.C. 2710(b)(2)(A), consistent with 25 U.S.C. 2710(b)(4)(B)(III) and
2711(c), which collectively requires that the Tribe receive at least 60
percent of net revenue. See, e.g., NIGC Bulletin No. 2021-6. The IGRA
at 25 U.S.C. 2711(c) sets a presumptive cap on management contracts of
30 percent of net revenue but allows for some management contracts to
go up to 40 percent of net revenue if the Chairman is satisfied that
the income projections and capital investment required justify the
higher fee.
One commenter believes the Department is artificially limiting the
scope of compacts with the new defined terms ``gaming facility'' and
``gaming space'' in Sec. 293.2(e) and Sec. 293.2(f). The commenter
also raised concerns these terms may bring compacts which are currently
in effect out of compliance with the proposed rule.
The Department acknowledges the concern regarding existing compacts
and notes that Sec. 293.30 clarifies that the final rule is
prospective and does not alter the Department's prior approval of
compacts now in effect. As explained in the Notice of proposed
rulemaking, IGRA limits the review period to approve or disapprove
compacts or amendments to 45 days. As a result, the Department cannot
retroactively approve or disapprove compacts or amendments after the
45-day review period has run. Therefore, any compacts already in effect
for the purpose of Federal law will remain in effect. The definition of
gaming spaces in the final rule continues to seek the smallest physical
footprint of potential State jurisdiction over a Tribe's land under
IGRA. This definition is intended to codify the Department's long-
standing narrow read of 25 U.S.C. 2710(d)(3)(C) as applying only to the
physical spaces in which the operation of class III gaming actually
takes place. The definition of gaming facility addresses building
maintenance and licensing under the second clause of 25 U.S.C.
2710(d)(3)(C)(vi) and is intended to be narrowly applied to only the
building or structure where the gaming activity occurs on Indian
lands.\8\
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\8\ See, e.g., Letter to the Honorable Peter S. Yucupicio,
Chairman, Pascua Yaqui Tribe of Arizona, from the Director, Office
of Indian Gaming, dated June 15, 2012, at 5, and fn. 9, discussing
the American Recovery & Reinvestment Act of 2009 and the IRS's
``safe harbor'' language to reassure potential buyers that tribally-
issued bonds would be considered tax exempt by the IRS because the
bonds did not finance a casino or other gaming establishment.

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[[Page 13235]]

One commenter requested the Department define ``Gaming facility''
as follows: ``Gaming facility means any physical space within a
building or structure, or portion thereof, where the gaming activity
occurs.'' The commenter stated this definition would avoid relying on
structural design of buildings to determine the scope of a compact. The
commenter noted that the definition of ``gaming facility'' is too broad
and is concerned that it may allow the State more control than it is
entitled to. Additionally, the commenter opined that the Department's
reliance on the IRS' safe harbor provision for tax-free bonds may
result in a compact which extends well beyond the gaming spaces based
on the structural engineering of the building. Finally, the commenter
is concerned that the Department has not incorporated its own
definition of ``gaming spaces'' into the substantive portions of the
draft.
The Department declines to accept the proposed change. As explained
in the Notice of proposed rule Making, the Department included the
defined terms ``gaming facility'' and ``gaming spaces.'' The definition
of gaming spaces seeks the smallest physical footprint of potential
State jurisdiction over a Tribe's land under IGRA. This definition is
intended to codify the Department's long-standing narrow read of 25
U.S.C. 2710(d)(3)(C) as applying only to the spaces in which the
operation of class III gaming actually takes place. The definition of
gaming facility addresses building maintenance and licensing under the
second clause of 25 U.S.C. 2710(d)(3)(C)(vi) and is intended to be
narrowly applied to only the building or structure where the gaming
activity occurs on Indian lands. The IRS safe harbor definition of
building was developed through consultation with the Secretary as a
workable test for Tribes to use tax exempt bonds to fund economic
development provided the bond was not being used to finance ``any
portion of a building in which class II or class III gaming . . . is
conducted or housed''. 26 U.S.C. 7871(f)(3)(B)(i). The IRS safe harbor
provides that a structure will be treated as a separate building--for
the purpose of tax exempt Tribal Economic Development Bonds--if it has
``an independent foundation, independent outer walls, and an
independent roof.'' \9\ Further, ``connections (e.g., doorways, covered
walkways or other enclosed common area connections) between two
adjacent independent walls of separate buildings may be
disregarded''.\10\ We are sensitive to the commenters concern that our
reliance on the IRS safe harbor definition may result in the portions
of the compact that address building maintenance and licensing under
the second clause of 25 U.S.C. 2710(d)(3)(C)(vi), reaching beyond the
gaming spaces as defined in Sec. 293.2(f).
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\9\ IRS Tax Exempt Bonds Notice 2009-51 (Tribal Economic
Development Bonds) Section 10 (b).
\10\ Id.
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One commenter requested that proposed Sec. 293.2(h)(2) be revised
to include the word ``activity'' so that the provision would read
``Directly related to gaming activity.''
The Department has modified Sec. 293.2(h)(2) in the final rule to
include the word ``activity.''
Several commenters expressed concern with the definitions of
``meaningful concessions'' and ``substantial economic benefit'' as too
narrow and vague. Several commenters stated that ``meaningful
concessions'' and ``substantial economic benefits'' are not clear terms
and suggested the proposed regulations include examples. Another
commenter recommended the Department should make clear that
``meaningful concessions'' require the State to give something up and
that proposed regulations should also address what constitutes
``substantial'' with respect to ``economic benefits.''
The Department acknowledges the comments and understands that the
Tribe and State, during their negotiations, determine what a
substantial economic benefit and meaningful concession means to them.
The final rule at Sec. 293.27 sets forth the Department's criteria for
reviewing revenue sharing provisions to ensure they provide a
substantial economic benefit in exchange for a meaningful concession.
One commenter suggested that the terms ``ancillary agreement'' and
``documents'' need further defining because it is still unclear how
those terms apply to Sec. Sec. 293.4, 293.8, 293.21, and 293.28 in the
proposed rule.\11\ Particularly in States like Arizona, where all
tribes are required to come to the table with a single compact, one
change to one tribe's compact might trigger changes to other Arizona
tribes' compacts.
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\11\ The Department notes Sec. 293.21 of the proposed rule has
been redesignated as Sec. 293.20 in the final rule, and Sec.
293.28 of the proposed rule has been redesignated as Sec. 293.29 in
the final rule.
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The Department acknowledges the comment and has reviewed the final
rule for consistency. The Department declines to define the terms
``ancillary agreement'' or ``documents'' as used in Sec. Sec. 293.4(b)
and 293.8(d). Section 293.4(b) contains descriptions of the types of
ancillary agreements or documents the Department will require be
submitted for review as well as types of documents which are exempt
from review.
Comments on Sec. 293.3--What authority does the Secretary have to
approve or disapprove compacts and amendments?
Many commenters support the proposed changes to Sec. 293.3.
The Department acknowledges the comments.
Comments on Sec. 293.4--Are compacts and amendments subject to review
and approval?
Many commentors support the proposed changes made to Sec. 293.4
because they help clarify what are considered to be compact amendments,
while also clarifying the timelines to submit agreements between
political subdivisions and Tribes. Commenters also support the
opportunity for Tribes to submit documents to the Department for
review.
The Department acknowledges the comments.
A commenter requested clarification if the Department's review of
an amendment includes reviewing the underlying compact for consistency
with the proposed rule.
The Department acknowledges the comment and notes IGRA limits the
Secretary's authority to review and approve or disapprove a compact or
amendment to 45 days. As a result, the Department cannot retroactively
approve or disapprove a compact or amendment after the 45-day review
period has run. Instead, the Department's review is limited to the text
of the document under review during the 45-day review period. The
Department treats restated and resubmitted compacts as a new compact
because the parties have submitted entire text of the compact for
review. The Department encourages parties to utilize restated compacts
or amended and restated compacts as a best practice to incorporate a
series of amendments into a single document. The Department finds it
helpful if the Tribe or State also submits a redlined copy of the
restated compact.
Several commenters expressed concerns whether proposed Sec.
293.4(b) requires review or exempts from review certain types of
intergovernmental and inter-tribal agreements including ``Transfer
Agreements'' and ``Pooling Agreements.''
The Department has made some stylistic revisions to Sec. 293.4(b)
in the final rule in an effort to further clarify

[[Page 13236]]

which documents are considered compacts or amendments subject to review
and which documents are exempt from review. Further, Sec. 293.4(c) of
the final rule allows parties to submit documents for a determination
if the document is a compact or amendment subject to review under IGRA.
Several commenters expressed support for proposed Sec. 293.4(b),
noting that revisions from the Consultation Draft resolved many
concerns about the scope of Sec. 293.4(b). Commenters stated proposed
Sec. 293.4(b) appears to exempt from review minor changes through
mutual agreement under provisions in existing compacts that allow for
such changes. Examples offered by commenters included adding class III
games or adopting a more favorable provision in a newly negotiated
compact or amendment through ``most favored nations'' provisions.
The Department notes that some compacts include provisions which
allow for the Tribe and the State to add class III games, or forms of
games, which are approved through changes in State law or regulations
without amending the Compact. The final rule at Sec. 293.4(b)(2) and
(3) exempts from review a document memorializing the automatic addition
of a class III game pursuant to such a provision. The final rule at
Sec. 293.4(b)(1) however clarifies that the incorporation of a more
favorable compact term through a ``most favored nation'' provision
would be treated as an amendment because it acts to modify or change a
term in a compact or amendment. The Department also encourages parties
to forgo submitting stand-alone amendments, and instead utilize
restated compacts or amended and restated compacts as a best practice
to incorporate a series of amendments into a single document.
A commentor requested the Department strike proposed Sec.
293.4(b)(3), arguing the provision is redundant with proposed Sec.
293.8(d), and contains various vague and undefined terms (e.g.,
``expressly contemplates'').
The Department acknowledges the comment and notes that the final
rule at Sec. 293.4 addresses whether a document is a compact or
amendment to a compact. The final rule at Sec. 293.8 addresses what
documents are required to be submitted as part of the Secretary's
review of a compact or amendment. Further, Sec. 293.4(b)(3) exempts
internal control standards and other documents between Tribal and State
regulators from review as a compact or amendment. The final rule at
Sec. 293.8(d) requires the submission of agreements required by a
compact which either requires the Tribe to make payments to the State,
its agencies, or its political subdivisions, or restricts or regulates
the Tribe's use and enjoyment of its Indian lands.
Several commenters discussed the Department's efforts to limit and
review agreements between Tribal and local governments through the
inclusion of Sec. Sec. 293.4(b)(4), 293.8(d), 293.24(c)(5), and Sec.
293.28 in the proposed rule.\12\ Some commenters expressed support for
the Department's effort in the rule making to prevent local governments
from disrupting Tribal gaming through revenue sharing demands noting
this is a continuation of the Department's recent disapprovals of
compacts containing similar language. Other commenters questioned if
the proposed provisions were sufficiently holistic to address the
efforts of local governments to disrupt Tribal gaming. Other commenters
questioned the Secretary's authority to review intergovernmental
agreements, suggesting that the Department's efforts were misplaced,
encroached on Tribal sovereignty, and may result in uncertainty
regarding the validity of existing intergovernmental agreements between
Tribes and local governments. Some commenters opined that these
sections contain inherent internal conflicts that could be interpreted
as both prohibiting the inclusion of provisions addressing
intergovernmental agreements in compacts, while also requiring the
submission of intergovernmental agreements for review as a compact.
Some commenters noted these agreements have resulted in strong co-
operative working relationships between Tribes and local governments
with overlapping or abutting jurisdictions.
---------------------------------------------------------------------------

\12\ The Department notes Sec. Sec. 293.24 and 293.28 have been
redesignated as Sec. Sec. 293.23 and 293.29 in the final rule.
---------------------------------------------------------------------------

The Department notes that intergovernmental agreements between
Tribes and States or local governments can be beneficial; Congress,
however, provided a narrow scope of topics that Tribes and States may
include when negotiating a Tribal-State gaming compact. As explained in
the Notice of proposed rulemaking, the Department revised these
provisions in the proposed rule--which are codified with minor
clarifying edits in the final rule--to clarify that these provisions
cover only agreements between Tribes and States, or States' political
subdivisions, which govern gaming, include payments from gaming
revenue, or are required by a compact or amendment. Agreements that are
not required by a compact and that do not regulate gaming do not need
to be submitted to the Department for approval as part of a Tribal-
State gaming compact. Likewise, agreements between Tribes and the State
and/or local governments that facilitate cooperation and good
governance, but that do not regulate gaming or require gaming revenue
sharing payments, should not be incorporated into or referenced as a
requirement of a Tribal-State gaming compact. The Department also
included the phrase ``restricts or regulates a Tribe's use and
enjoyment of its Indian lands'' to clarify these agreements may be
considered both as a contract which encumber Tribal lands under 25
U.S.C. 81 and the Department's regulations at 25 CFR part 84, and as a
compact or amendment under IGRA. The Department has included the Sec.
293.4(c) process for a determination if an agreement or other document
is a compact or amendment in the final rule.
A commenter recommends qualifying proposed Sec. 293.4(b)(4) by
including a reference to ``the State, its agencies or political
subdivisions'' to make it consistent with proposed Sec. 293.8(d).
Another recommends that the Department remove ``or includes any of the
topics identified in 25 CFR 292.24'' from proposed Sec. 293.4(b)(4). A
commenter recommends qualifying Sec. 293.4(b)(4) by including a
reference to ``the State, its agencies or political subdivisions''
because adding this language would improve the clarity of the
regulatory text by ensuring that this provision is consistent with
proposed rule Sec. 293.8(d) and proposed rule Sec. 293.28.\13\ The
commenter argued it would also eliminate any uncertainty regarding
whether a contract with a private party (e.g., financing documents,
management contracts, development agreements, etc.) could be subject to
this provision. Others requested changes to proposed Sec. 293.4(b)(4).
Many commentors submitted draft language.
---------------------------------------------------------------------------

\13\ The Department notes proposed Sec. 293.28 has been
redesignated as Sec. 293.29 in the final rule.
---------------------------------------------------------------------------

The Department has modified Sec. 293.4(b)(4) in the final rule to
state that if an ancillary agreement or document interprets language in
a compact or an amendment concerning a Tribe's revenue sharing to the
State, its agencies or political subdivisions under Sec. 293.27, or
includes topics which are directly related to the operation of gaming
activities under Sec. 293.23, then it may constitute an amendment
subject to review and approval by the Secretary.
Several commenters noted the proposed Sec. 293.4(b)(4) appeared to
contain a typographical error in the cross-reference to 25 CFR 292.24
and

[[Page 13237]]

suggested the correct cross-reference is 25 CFR 293.24.\14\
---------------------------------------------------------------------------

\14\ The Department notes proposed Sec. 293.24 has been
redesignated as Sec. 293.23 in the final rule.
---------------------------------------------------------------------------

The Department has corrected the error and changed the cross-
reference to Sec. 293.23 in the final rule.\15\
---------------------------------------------------------------------------

\15\ The Department notes proposed Sec. 293.24 has been
redesignated as Sec. 293.23 in the final rule.
---------------------------------------------------------------------------

Several commenters recommended the Department make a technical
amendment to proposed Sec. 293.4(c) to provide clarity regarding when
the clock begins to run on the opinion letter issuance timeline and
offered suggested language. Commenters noted that the usefulness of
proposed Sec. 293.4(c) would be limited without including reasonable
parameters on review time. Other commenters requested the Department
reduce the timeline of review in Sec. 293.4(c).
The Department has accepted the comments in part and modified Sec.
293.4(c) in the final rule to state that the Department will issue a
letter within 30 days of receipt of the written request, providing
notice of the Secretary's determination. The revised language clarifies
when the clock starts. Additionally, the Department has adjusted the
review period to 30 days, for consistency with section 81, Encumbrances
of Tribal Land Contract Approvals under 25 CFR 84.005. The Department
notes some agreements may trigger both IGRA and section 81 review.
Should the Secretary determine that an ancillary agreement or document
is a compact or amendment subject to review and approval by the
Secretary, the Department has included clarifying language that the
Tribe or State must resubmit the ancillary agreement or document
consistent with Sec. 293.8.
Several commenters suggested the Department revise proposed Sec.
293.4(c) by including a ``deeming'' language so that if the deadline is
missed, the document or agreement submitted pursuant to Sec. 293.4(c)
would be presumed ``not a compact or amendment.''
The Department declines to include ``deeming'' language as it could
result in unintended consequences, including compacts or amendments
which are not in effect as a matter of Federal law. Rather, the
Department has included clarifying language that should the Secretary
determine that an ancillary agreement or document is a compact or
amendment subject to review and approval by the Secretary, the Tribe or
State must resubmit the ancillary agreement or document consistent with
Sec. 293.8.
Several commenters requested the Department clarify if an agreement
or other document submitted for review under proposed Sec. 293.4(c)
would be subjected to adverse action.
The Department acknowledges the comments and notes that the review
process in Sec. 293.4(c) of the final rule builds on the Department's
longstanding practice of providing compact technical assistance to
Tribes and States. The review process found in Sec. 293.4(c) utilizes
a shorter review period and does not include the formal submission
requirements of Sec. 293.8. The Sec. 293.4(c) review process
culminates in a written determination if the submitted document is a
compact or amendment under IGRA.
Comments on Sec. 293.5--Are extensions to compacts or amendments
subject to review and approval?
Several commenters expressed support for proposed changes to Sec.
293.5, opining the revisions are consistent with other provisions of
the rule. Some commenters appreciate the addition of ``[t]he extension
becomes effective only upon publication in the Federal Register.'' One
commenter appreciates the lessened documentation requirements for
processing compact extensions under proposed Sec. 293.5.
The Department acknowledges the comments.
Comments on Sec. 293.6--Who can submit a compact or amendment?
Several commenters expressed support for the proposed changes to
Sec. 293.6.
The Department acknowledges the comments.
Comments on Sec. 293.7--When should the Tribe or State submit a
compact or amendment for review and approval?
Several commenters expressed support for the proposed changes to
Sec. 293.7. One commenter supported the inclusion of the phrase
``otherwise binding on the parties'' and explained that language
acknowledges some documents and ancillary agreements become binding on
parties outside of an affirmative consent process.
The Department acknowledges the comments.
Comments on Sec. 293.8--What documents must be submitted with a
compact or amendment?
Several commenters support the proposed changes to Sec. 293.8, and
many commenters support the addition of proposed Sec. 293.8(d).
The Department acknowledges the comments.
Several commenters requested that proposed Sec. 293.8(d) be
further clarified to avoid confusion about what documents should be
submitted with a compact or amendment. One commenter offered the
following edit to Sec. 293.8(d) for clarity: ``Any agreement between a
Tribe and a State, its agencies or its political subdivisions required
by a compact or amendment (including ancillary agreements, documents,
ordinances, or laws required by the compact or amendment).'' The
commenter also recommended the Department strike the remainder of Sec.
293.8(d).
The Department has accepted the revisions in part to reduce
duplication with other sections of the final rule. The Department has
changed the language of Sec. 293.8(d) to state any agreement between a
Tribe and a State, its agencies or its political subdivisions required
by a compact or amendment (including ancillary agreements, documents,
ordinances, or laws required by the compact or amendment) which the
Tribe determines is relevant to the Secretary's review.
One commenter requested the Department strike proposed Sec.
293.8(d) from the final rule, stating the subsection is unnecessary.
The Department declines to remove proposed Sec. 293.8(d). The
Department notes that intergovernmental agreements between Tribes and
States or local governments can be beneficial; Congress, however,
provided a narrow scope of topics that Tribes and States may include
when negotiating a Tribal-State gaming compact. As explained in the
notice of proposed rulemaking, and above, the Department included Sec.
293.8(d) to address agreements between Tribes and States, or States'
political subdivisions, which are required by a compact or amendment
and require the Tribe to make payments to the State, its agencies, or
its political subdivisions, or restricts or regulates the Tribe's use
and enjoyment of its Indian lands. This provision ensures that such
agreements receive proper scrutiny by the Department as required by
IGRA and other Federal laws. The Department included the phrase
``restricts or regulates a Tribe's use and enjoyment of its Indian
Lands'' to clarify these agreements may be considered both contracts
which encumber Tribal lands under 25 U.S.C. 81 and the Department's
regulations at 25 CFR part 84, and as a compact or amendment under
IGRA. The Department has included the Sec. 293.4(c) process for a
determination if an agreement or other document is a compact or
amendment in the final rule.

[[Page 13238]]

One commenter requested the language in Sec. 293.8(e) be narrowed
by including the phrase ``directly related to and necessary for making
a determination.''
The Department declines to accept the suggested change to the
language in Sec. 293.8(e). The relevant text of Sec. 293.8(e) remains
unchanged from the 2008 Regulations, where it was numbered as Sec.
293.8(d) and allows the Secretary to request documentation relevant to
the decision-making process.
A commenter expressed support that the proposed rule included a
requirement of a market analysis, or similar documentation, as part of
the compact submission package for compacts that include revenue
sharing in Sec. 293.8(e). This would require compacting parties to
prove revenue sharing agreements provide actual benefits to Tribes.
The Department acknowledges the comment and notes concerning Sec.
293.8(e).
A commenter expressed concern that the proposed rule contained a
new requirement of a market analysis, or similar documentation, for
compacts that include revenue sharing in Sec. 293.8(e). The commenter
stated this requirement creates unnecessary delay and expense.
The Department acknowledges the comment and notes that the
requirement in Sec. 293.8(e) of the final rule represents a
codification of the existing Departmental practice of requiring a
market analysis, or similar documentation, as part of the submission
package for compacts or amendments that include revenue sharing
provisions. The Department routinely requests this information through
Sec. 293.8(d) of the 2008 Regulations. The Department included in
Sec. 293.8(e) of the proposed rule a cross reference to Sec.
293.28,\16\ codifying the Department's longstanding rebuttable
presumption that any revenue sharing provisions are a prohibited tax,
fee, charge, or other assessment. The Department has long required
evidence, including market studies or other documentation, that a
State's meaningful concession provides a substantial economic benefit
to the Tribe in a manner justifying the revenue sharing required by the
compact.
---------------------------------------------------------------------------

\16\ The Department notes proposed Sec. 293.28 has been
redesignated as Sec. 293.29 in the final rule.
---------------------------------------------------------------------------

Comments on Sec. 293.9--Where should a compact or amendment or other
requests under this part be submitted for review and approval?
A number of commenters support the proposed changes to Sec.
293.9--especially the Department's proposal to accept electronic
submissions. Commenters argue that electronic submissions will allow
for increased efficiency and decreased processing times.
The Department acknowledges the comments.
Comments on Sec. 293.10--How long will the Secretary take to review a
compact or amendment?
Several commenters expressed support for the proposed changes to
Sec. 293.10.
The Department acknowledges the comments.
Comments on Sec. 293.11--When will the 45-day timeline begin?
Several commenters expressed support for the inclusion of a
requirement for the Department to provide an acknowledgment email for
electronically submitted compacts in Sec. 293.11 of the final rule and
note that a confirmation email works well with the proposed changes to
Sec. 293.9.
The Department acknowledges the comments. The Department also notes
that Sec. 293.8(a) requires submission of at least one original paper
copy of the fully executed compact if the compact or amendment was
submitted electronically and the compact or amendment was executed
utilizing ``wet'' or ink signatures.
Comments on Sec. 293.12--What happens if the Secretary does not act on
the compact or amendment within the 45-day review period?
Several commenters expressed support for the proposed changes made
to Sec. 293.12, including the codification of a letter informing the
parties when a compact has gone into effect by operation of law,
commonly referred to as ``deemed approved letters.'' Commenters also
expressed support for the routine inclusion of language discussing
provisions that may be inconsistent with the Department's
interpretation of IGRA in ``deemed approved letters.'' Commenters also
requested the Department increase the specificity included in ``deemed
approved letters,'' including identifying the provisions that the
Department considers are in violation of IGRA, as well as an
explanation of the Department's reasoning.
The Department acknowledges the comments and notes that the final
rule, consistent with the proposed rule, requires the Secretary to
issue a ministerial letter informing the parties to the compact or
amendment that it has gone into effect by operation of law. That letter
may, at the Secretary's discretion, include guidance to the parties
reflecting the Department's interpretation of IGRA.
Several commenters requested additional clarification on the
potential uses of ``deemed approved'' letters, including if the deemed
approved letter is ``final agency action'' and if the underlying
compact would be ripe for litigation that challenges provisions the
Department identifies in a ``deemed approved letter.'' Commenters
offered proposed regulatory language: ``Accordingly, the signatory
Tribe or State may subsequently challenge the non-compliant Compact
provisions as unenforceable or severable from the Compact.''
The Department acknowledges the comment. The Department declines to
include the proposed language in the final rule. Under IGRA, the
Department has 45 days to complete its review and either approve or
disapprove a class III gaming compact. If the Department takes no
action within that 45-day period, the Tribal-State gaming compact is
considered approved by operation of law--to the extent that it is
consistent with IGRA. The Department takes no position on whether a
Tribe or a State may subsequently challenge any compact provisions as
unenforceable or severable from the compact.
One commenter requested the timeline for issuing a deemed approved
letter be shortened to 60 days and provided draft language to that
effect.
The Department declines to shorten the timeframe and refers to the
second sentence of Sec. 293.12, which states that the Secretary will
issue a letter informing the parties that the compact or amendment has
been approved by operation of law after the 45th day and before the
90th day. The 60-day suggestion falls within this timeframe. The final
rule at Sec. 293.14(b) states that the notice of affirmative approval
or approval by operation of law must be published in the Federal
Register within 90 days from the date the compact or amendment is
received by the Office of Indian Gaming.
Several commenters are concerned that the proposed Sec. 293.12
conflicts with Amador County v. Salazar, 640 F.3d 373 (D.C. Circuit
2011), in which the D.C. Circuit held that IGRA requires the Secretary
to disapprove compacts that violate IGRA. Commenters raised both policy
and legal concerns with the Department's practice of permitting

[[Page 13239]]

compacts with problematic provisions to be approved by operation of
law.
The Department acknowledges the comments. Congress, through IGRA at
25 U.S.C. 2710(d)(8), provided the Secretary with time-limited
authority to review a compact and discretionary disapproval authority.
Within this limited review period, the Secretary may approve or
disapprove a compact. IGRA further directs that if the Secretary does
not approve or disapprove a compact within IGRA's 45-day review period,
then the compact shall be considered to have been approved by the
Secretary, but only to the extent the compact is consistent with the
provisions of IGRA. 25 U.S.C. 2710(d)(8)(C). The Department notes that
one Circuit has held that the Secretary must disapprove a compact if it
is inconsistent with IGRA and thus, may not approve such compact by
operation of law. Amador County v. Salazar, 640 F.3d 373, 381 (D.C.
Cir. 2011). The Department also notes that the D.C. Circuit in West
Flagler Associates, Ltd. v. Haaland, 71 F.4th 1059, 1067 (D.C. Cir.
2023), explained that its holding in Amador County was premised on the
requirement under 25 U.S.C. 2710(d)(8)(A) that compacts govern gaming
on Indian lands. In Amador County, the central, then-unanswered
question at issue in the case was whether the gaming contemplated by
the compact at issue would occur on property that qualified as ``Indian
lands'' under IGRA. The D.C. Circuit found that the Secretarial
disapproval was obligatory in this context because the particular
statutory requirement that compacts govern gaming on Indian lands could
not be satisfied. West Flagler, 71 F.4th at 1064.
Comments on Sec. 293.13--Who can withdraw a compact or amendment after
it has been received by the Secretary?
Several commenters expressed support for the proposed changes made
to Sec. 293.13.
The Department acknowledges the comments.
Comments on Sec. 293.14--When does a compact or amendment take effect?
Several commenters expressed support for the proposed changes made
to Sec. 293.14.
The Department acknowledges the comments.
Comments on Sec. 293.15--Is the Secretary required to disapprove a
compact or amendment that violates IGRA?
Several commenters support the proposed Sec. 293.15.
The Department acknowledges the comments and after further
consideration and review of all comments, the Department declines to
adopt proposed Sec. 293.15 in the final rule.
Several commenters opposed the entirety of proposed Sec. 293.15.
Several commenters expressed concern that the proposed Sec. 293.15
would permit compacts with unlawful provisions to go into effect by
operation of law and limit the ability of the compacting parties to
challenge the legality of such compacts.
The Department acknowledges the comments, and after further
consideration, the Department declines to adopt proposed Sec. 293.15
in the final rule.
One commenter requested the Department include in the final rule a
non-exhaustive list of IGRA violations which would compel a
disapproval.
The Department acknowledges the comments, and after further
consideration, the Department declines to adopt proposed Sec. 293.15
in the final rule.
Several commenters argued that Amador County held that the
Department has an affirmative duty to disapprove illegal compacts and
provided draft language to effect that duty. Commenters further noted
that the Department's brief in West Flagler appeared to adopt the
Amador County standard as binding on the Department, which appeared to
conflict with the proposed Sec. 293.15.
The Department acknowledges the comments, and after further
consideration, the Department declines to adopt proposed Sec. 293.15
in the final rule.
Comments on Sec. 293.16--Which has been redesignated as Sec. 293.15--
When may the Secretary disapprove a compact or amendment?
The Department has redesignated proposed Sec. 293.16 as Sec.
293.15 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Two commenters support the proposed changes made to Sec. 293.15.
The Department acknowledges the comments.
One commenter requested clarifying language regarding the
Secretary's ability to approve or disapprove compacts.
The Department acknowledges the comment, but notes this provision
is consistent with Congress' grant of discretionary disapproval
authority to the Secretary. 25 U.S.C. 2710(d)(8)(B)(iii). The
Department notes the proposed Sec. 293.15(b) would clarify that if a
compact submission package is missing the documents required by Sec.
293.8 and the parties decline to cure the deficiency, the Secretary may
conclude that the compact or amendment was not ``entered into'' by the
Tribe and State as required by IGRA, 25 U.S.C. 2710(d)(1)(C), and will
disapprove the compact or amendment on that basis. See, e.g., Pueblo of
Santa Ana v. Kelly, 104 F.3d 1546, 1555 (10th Cir. 1997) (a compact or
amendment must have been ``validly entered into'' before it can go into
effect through Secretarial approval). The Department notes this is a
change from an earlier practice of returning incomplete compact
submission packages. The Department has reconsidered this practice so
as to better fulfill Congress's goal of avoiding unnecessary delay in
the Secretary's review process. If the Department cannot determine,
based on the lack of documentation, that the compact was validly
entered into by both the Tribe and the State, then approval--
affirmative or by operation of law--exceeds the Secretary's authority.
Several commenters believe proposed Sec. 293.15(b) is
unnecessarily punitive unless the parties are provided a timely
opportunity to cure deficiencies within the submission package or
provide the Secretary with any missing documents. Several commenters
offered draft regulatory text, including differing timeframes for
submitting missing information or explaining why the required
information was not submitted.
The Department acknowledges the comments and has accepted the
revisions in part, changing Sec. 293.15(b) of the final rule to state
that if the documents required in Sec. 293.8 are not submitted and the
Department has informed the parties in writing of the missing
documents, and provided the parties with an opportunity to supply those
documents, the Secretary may conclude the compact or amendment was not
validly entered into between the Tribe and the State and will
disapprove the compact or amendment on those grounds.
Another commenter suggested an additional paragraph (c): ``At any
time after the compact or amendment is submitted, the tribal party may
submit a written request to pause the 45-day deadline for the Secretary
to make a decision for purposes of supplying any missing document(s).
Effective the date such request is received by the Department, no more
days toward the 45-day deadline will accrue until written request to
resume the 45-day period is received from the tribal applicant.''

[[Page 13240]]

The Department declines to incorporate the suggested new paragraph
(c) in Sec. 293.16 of the final rule and notes that IGRA's 45-day
review period cannot be tolled. If the Tribe or the State is unable to
provide missing documents within the 45-day review period, the parties
may withdraw the compact from Secretarial review under Sec. 293.13,
then resubmit the compact with the documents required under Sec.
293.8.
Comments on Subpart D
Several commenters expressed opposition to the part 293 Rulemaking
effort and requested the Department remove all substantive provisions
in subpart D.
The Department acknowledges the comments but declines to remove the
substantive provisions contained in subpart D.
Several commenters objected to the rulemaking effort, questioned
the Secretary's authority to engage in rulemaking or provide
substantive rules on the scope of Tribal-State gaming compacts.
Commenters also questioned the Department's inclusion of evidence of
``bad faith'' or ``violations of IGRA.''
The Secretary has authority to promulgate regulations regarding the
Department's procedures for the submission and review of compacts and
amendments based on the statutory delegation of powers contained in
IGRA and 25 U.S.C. 2 and 9. In enacting IGRA, Congress delegated
authority to the Secretary to review compacts to ensure that they
comply with IGRA, other provisions of Federal law that do not relate to
jurisdiction over gaming on Indian lands, and the trust obligations of
the United States. 25 U.S.C. 2710(d)(8)(B)(i)-(iii). IGRA establishes
the parameters for topics that may be the subject of compact and
amendment negotiations and included in compacts. Thus, in reviewing
submitted compacts and amendments, the Secretary is vested with the
authority to determine whether the compacts contain impermissible
topics. The Department recognizes that section 2710(d)(7)(A)(i) of IGRA
vests jurisdiction in district courts over ``any cause[s] of action . .
. arising from the failure of a State . . . to conduct [ ] negotiations
in good faith.'' The district courts review of the negotiation process
often includes reviewing if the negotiations have strayed beyond IGRA's
limited list of permissible topics in a compact. The Secretary's review
of a compact begins after the parties have executed the compact and
necessarily includes reviewing if it contains terms that strayed beyond
IGRA's limited list of permissible topics in a compact. This overlap
has resulted in a body of case law the Department has interpreted and
incorporated into longstanding Departmental policies. Additionally,
courts have looked to prior Departmental decisions, ``deemed approved''
letters, and policy statements to guide the courts review. Therefore,
the Department has replaced the phrase ``is considered evidence of bad
faith'' with the phrase ``may be considered evidence of a violation of
IGRA'' in the final rule. This change harmonizes the Department's
regulations with IGRA's plain language by enumerating the specific
topics that are appropriately addressed in compacts. The Department's
regulations also identify examples of impermissible topics that may be
considered evidence of a violation of IGRA.
Several commenters argued that the Department's interpretation of
25 U.S.C. 2710(d)(3)(C) as an exclusive list of proper compact terms is
improper, and that the Department's interpretation that 25 U.S.C.
2710(d)(3)(C)(vii) must be narrowly applied is not supported by IGRA or
case law.
The Department acknowledges the comment and notes that the
Department's longstanding interpretation of IGRA's list of permissible
topics for compacts, located at 25 U.S.C. 2710(d)(3)(c), as exhaustive
is consistent with prevailing caselaw. For example, the Ninth Circuit
in Chicken Ranch stated: ``IGRA, we made clear, does not permit the
State and the [T]ribe to negotiate of any subjects the desire; rather,
IGRA anticipates a very specific exchange of rights and obligations.''
\17\
---------------------------------------------------------------------------

\17\ Chicken Ranch Rancheria of Me-Wuk Indians v. Cal., 42 F.4th
1024, 1034 (9th Cir. 2022). Internal citations and quotations
omitted.
---------------------------------------------------------------------------

Comments on Sec. 293.17--Which has been redesignated as Sec. 293.16--
May a compact or amendment include provisions addressing the
application of the Tribe's or the State's criminal and civil laws and
regulations?
The Department has redesignated proposed Sec. 293.17 as Sec.
293.16 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Many commenters expressed support for the proposed Sec. 293.16.
The Department acknowledges the comments.
One commenter requested the Department strike the phrase ``At the
request of the Secretary pursuant to Sec. 293.8(e)'' from the second
sentence of Sec. 293.16. The commenter argued the change would allow
Tribal control over what State regulations apply.
The Department declines the proposed revision to Sec. 293.16,
which allows the Secretary to determine when additional information is
needed during the Department's review and approval process.
Comments on Sec. 293.18--Which has been redesignated as Sec. 293.17--
May a compact or amendment include provisions addressing the allocation
of criminal and civil jurisdiction between the State and the Tribe?
The Department has redesignated proposed Sec. 293.18 as Sec.
293.17 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Many commenters expressed support for the proposed Sec. 293.17.
The Department acknowledges the comments.
One commenter would like the Department to add ``reasonable'' to
Sec. 293.17 describing criminal and civil jurisdiction between the
State and the Tribe necessary for the enforcement of the laws and
regulations described in Sec. 293.16.
The Department declines to accept the recommendation to add the
word ``reasonable.'' This is not needed because the final rule at Sec.
293.17 authorizes only those provisions ``necessary for the enforcement
of the laws and regulations described in Sec. 293.16,'' which in turn
requires that the ``laws and regulations are ``directly related to and
necessary for the licensing and regulation of the gaming activity.''
(emphasis added).
Two commenters requested the Department clarify proposed Sec. Sec.
293.16 and 293.17 to confirm that the Tribe and the State may agree, as
a matter of contract, that the Tribe will adopt standards that are
equivalent to State standards.
The Department acknowledges the comments and notes that neither
IGRA, nor the Department's regulations, prohibit a Tribe from adopting
standards that are equivalent to State standards. Additionally, the
final rule in Sec. 293.21, directly addresses a Tribe's adoption of
standards equivalent or comparable to State standards.
Comments on Sec. 293.19--Which has been redesignated as Sec. 293.18--
May a compact or amendment include provisions addressing the State's
costs for regulating gaming activities?
The Department has redesignated proposed Sec. 293.19 as Sec.
293.18 in the final rule. Comments have been edited

[[Page 13241]]

to reflect the new section number in the final rule.
Several commenters stated the proposed rule contained a
typographical error with the use of the word ``is'' in the final
sentence of proposed Sec. 293.18 and offered a conforming edit.
The Department has accepted the conforming edit to the last
sentence of Sec. 293.18 in the final rule, which now states that if
the compact does not include requirements for the State to show actual
and reasonable annual expenses for regulating the specific Tribe's
gaming activity over the life of the compact, the lack of such
requirement may be considered evidence of a violation of IGRA.
Several commenters would like the Department to require greater
proof of the reasonableness of a State's regulatory costs. Commenters
requested the Department include the additional language to Sec.
293.18, requiring specific forms of proof of both the actual cost and
the reasonableness of the cost during the life of the compact.
The Department acknowledges the comments but declines to require
specific forms of proof of both actual cost and the reasonableness of
the cost or to define or require proof of reasonableness. The
Department reads IGRA's provision permitting the State to assess
regulatory costs narrowly and as inherently limited to the negotiated
allocation of regulatory jurisdiction. The final rule at Sec. 293.18
allows Tribes and States flexibility to determine how the parties will
incorporate IGRA's limits on a State's assessment of regulatory costs
into a compact, including flexibility in negotiating the terms that
determine how the State will show aggregate costs are actual and
reasonable. Providing specific definitions would diminish the parties'
flexibility in negotiating reasonable compact terms that best meet the
needs of the parties.
Several commenters expressed concern with the Department's
inclusion of reporting requirements in Sec. 293.18. The commenters
argued that requirement would make it difficult for States to recoup
the cost of regulating class III gaming, particularly in States with
multiple Tribes who operate differing numbers and sizes of gaming
facilities.
The Department acknowledges the comment. The final rule at Sec.
293.27 includes a discussion of the Department's interpretation of
IGRA's prohibition against the imposition of a tax, fee, charge, or
other assessment. IGRA provides that a compact may include provisions
relating to ``the assessment by the State of [the Tribe's class III
gaming activity] in such amounts as are necessary to defray the costs
of regulating [the Tribe's class III gaming activity].'' 25 U.S.C.
2710(d)(3)(C)(iii). In section 2710(d)(4), IGRA then prohibits the
State from imposing a tax, fee, charge, or other assessment except for
any assessments that may be agreed to under section 2710(d)(3)(C)(iii).
The Department reads IGRA's provision permitting the State to assess
regulatory costs narrowly and as inherently limited to the negotiated
allocation of regulatory jurisdiction. Further, the Department has
revised Sec. 293.18 in the final rule to give the parties flexibility
in negotiating the terms of a compact to determine how the State will
show aggregate costs are actual and reasonable.
Comments on Sec. 293.20--Which has been redesignated as Sec. 293.19--
May a compact or amendment include provisions addressing the Tribe's
taxation of gaming?
The Department has redesignated proposed Sec. 293.20 as Sec.
293.19 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Several commenters support the proposed Sec. 293.19.
The Department acknowledges the comments.
Several commenters expressed concerns with the Department's
inclusion of Sec. 293.19 in the proposed rule and argued that States
may begin demanding compact provisions addressing the taxation of
Tribal gaming. Others requested the Department strike specific language
referencing State tax rates. Another commenter requested the Department
include a ``directly related'' nexus for Tribal tax equivalents.
The Department acknowledges the comments but declines to make the
requested changes to Sec. 293.19 in the final rule. IGRA provides that
a compact may address Tribal taxation of Tribal class III gaming in
amounts comparable to State taxation of State gaming. 25 U.S.C.
2710(d)(3)(C)(iv).
Comments on Sec. 293.21--Which has been redesignated as Sec. 293.20--
May a compact or amendment include provisions addressing the resolution
of disputes for breach of the compact?
A number of commenters expressed support for proposed Sec. 293.20,
especially regarding the opportunity for Tribes to submit dispute
resolution documents, settlement agreements, or arbitration decisions
they are concerned act to amend the terms of their compact.
The Department acknowledges the comments.
Several commenters expressed concerns with the scope of review
under Sec. 293.20 and questioned how those provisions may impact
existing compacts.
The Department acknowledges the comments and notes that Sec.
293.32(b) of the final rule clearly states that the final rule is
prospective and does not alter prior Departmental decisions on
compacts. Additionally, Sec. 293.20 allows the Tribe to use the Sec.
293.4 process, including requesting a determination from the Department
under Sec. 293.4(c), to determine if their dispute resolution
agreement or other document amends or alters the compact from which the
dispute arose, or addresses matters not directly related to the
operation of gaming.
One commenter requested the Department include within Sec. 293.20
a duty on the Secretary to disapprove any compact which provides that
the only remedy for a breach of compact is suspension or termination of
the compact. The commenter argued that compacts should be required to
include reasonable notice of alleged breach of compact with
opportunities to cure any alleged violations.
The Department acknowledges the comment but declines to include an
affirmative duty to disapprove a compact in all instances. The
Department is concerned that a mandate requiring the Secretary to
affirmatively disapprove compacts that contain illusory remedies for
breach of compact would narrow the discretion IGRA provides the
Secretary to either approve or disapprove a compact within the
prescribed 45-day review period. The Department also notes that many
compacts include opportunities for parties to the compact to meet and
discuss alleged breaches of compact and arrange reasonable timelines
for either curing the breach or negotiating an amendment to the compact
addressing the breach.
Several commenters suggested that the Department is acting beyond
its authority in proposed Sec. 293.20 by impermissibly interpreting
IGRA and acting without authority to review any and all court orders
between Tribes and States as if they are compact amendments. The
commenters also argued the proposed Sec. 293.20 violates the Federal
Arbitration Act.
The Department acknowledges the comments but disagrees with the
commenters' view of the reach of Sec. Sec. 293.20 and 293.4. These
provisions provide Tribes the opportunity to seek a determination from
the Department of whether their dispute resolutions, settlement
agreements, or arbitration

[[Page 13242]]

decisions amend their compact such that Secretarial review and approval
is required. The Department has observed Tribes and States resolving
compact disputes through agreements that act to amend or change the
terms in the underlying compact. Further, the Federal Arbitration Act
permits an arbitration award to be vacated where the arbitrators
exceeded their powers or so imperfectly executed them that a mutual,
final, and definite award was not made. 9 U.S.C. 10(a)(4). When an
arbitration award acts to amend or change a term in the underlying
compact it necessarily triggers IGRA's Secretarial review and approval
requirement prior to becoming effective or final.
Comments on Sec. 293.22--Which has been redesignated as Sec. 293.21--
May a compact or amendment include provisions addressing standards for
the operation of gaming activity and maintenance of the gaming
facility?
The Department has redesignated proposed Sec. 293.22 as Sec.
293.21 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
A number of commenters expressed support for Sec. 293.21 because
it helps to specify what provisions may be included in a compact.
The Department acknowledges the comments.
One commenter requested the Department add the phrase ``within
gaming spaces'' to proposed Sec. 293.21. The commenter argued this
edit would be consistent with other portions of the proposed rule and
IGRA by distinguishing between the physical space where the ``standards
for the operation of gaming'' may properly reach, and from the gaming
facility spaces where the standards for maintenance and licensing may
properly reach.
The Department acknowledges the comment and has added the suggested
phrase ``within gaming spaces'' to Sec. 293.21 in the final rule.
A commenter expressed concerns that Sec. 293.21 may have
unintended consequences by restricting provisions which a Tribe may
consider germane and arising from the Tribe's conduct of gaming.
The Department acknowledges the comment and notes Sec. 293.21 in
the final rule requires evidence that the required standards are ``both
directly related to and necessary for the licensing and regulation of
the gaming activity.'' The Department seeks to clarify and enforce the
proper scope of compacts negotiated under IGRA while deferring to and
respecting a Tribe's sovereign decision making.
Comments on Sec. 293.23--Which has been redesignated as Sec. 293.22--
May a compact or amendment include provisions that are directly related
to the operation of gaming activities?
The Department has redesignated proposed Sec. 293.23 as Sec.
293.22 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
A number of commenters expressed support for proposed Sec. 293.22,
explaining Sec. Sec. 293.22 and 293.23 will help limit State overreach
into class III gaming.
The Department acknowledges the comments.
One commenter requested that the proposed Sec. 293.22 be struck as
unnecessary.
The Department declines to strike the proposed Sec. 293.22 from
the final rule. The Department notes that the proposed Sec. 293.22 was
added in response to comments received during the Tribal consultation
process. The final rule further clarifies, consistent with the holding
of West Flagler Associates., Ltd. v. Haaland, 71 F.4th 1059 (D.C. Cir.
2023), that ``directly related'' activities may include activities that
occur off Indian lands.
Comments on Sec. 293.24--Which has been redesignated as Sec. 293.23--
What factors will be used to determine whether provisions in a compact
or amendment are directly related to the operation of gaming
activities?
The Department has redesignated proposed Sec. 293.24 as Sec.
293.23 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
A number of commenters expressed support for Sec. 293.23 and
applauded revisions the Department included in response to comments
received during Tribal consultation. Commenters noted that the
provisions would codify the Department's longstanding ``direct
connection test,'' which was found persuasive by the Ninth Circuit in
Chicken Ranch, 42 F.4th at 1036. Commenters also stated that the
proposed Sec. 293.23 would help Tribes and States understand the
limits that IGRA imposes on Tribal-State gaming compacts.
The Department acknowledges the comments.
A commenter requested the Department revise proposed Sec.
293.23(a) by adding the phrase ``within gaming spaces'' for consistency
with other provisions in the proposed rule.
The Department acknowledges the comment but declines to include the
proposed revision, which would create a logical conflict with Sec.
293.23(a)(2) which addresses the transportation of gaming devices and
equipment.
Several commenters expressed concern that, as drafted, the proposed
Sec. 293.23 could be construed to prohibit provisions addressing the
collective bargaining rights of employees of a Tribal gaming facility.
The commenters argued such an interpretation of the regulations
conflicts with existing Ninth Circuit caselaw, citing to Coyote Valley
II \18\ and the Biden Administration's stated policies in Executive
Order 14025. One commenter requested the Department include clarifying
language in Sec. 293.23 and offered proposed regulatory text.
---------------------------------------------------------------------------

\18\ In re Indian Gaming Related Cases (Coyote Valley II), 331
F.3d 1094 (9th Cir. 2003).
---------------------------------------------------------------------------

The Department acknowledges the comments and has included a new
provision Sec. 293.24 addressing rights of employees. The proposed
regulations codify existing case law, including Coyote Valley II,\19\
Rincon,\20\ and Chicken Ranch.\21\ These cases collectively recognize
that a compact can include provisions addressing labor relations for
employees, including service and hospitality workers (such as food and
beverage, housekeeping, cleaning, bell and door services, and laundry
employees) of the gaming facility or at a facility whose only
significant purpose is to facilitate patronage at the gaming facility
because gaming activities could not operate without someone performing
those jobs and thus the labor is directly related to gaming activities
and inseparable from gaming itself. Additionally, Tribes and Unions may
negotiate labor relations agreements or labor relations ordinances
outside of a compact. In light of this body of caselaw, in this labor-
relations context only, gaming compacts may include provisions
addressing labor relations, or the process for reaching a labor
relations agreement, although portions of these provisions or processes
may include labor activities performed beyond the physical areas where
class III gaming actually takes place. Nothing in these regulations
alters Unions' existing ability to negotiate labor relations agreements
with Tribes or to advocate for Tribes to pass Tribal labor

[[Page 13243]]

relations laws outside of the compacting process.
---------------------------------------------------------------------------

\19\ In re Indian Gaming Related Cases (Coyote Valley II), 331
F.3d 1094 (9th Cir. 2003).
\20\ Rincon Band of Luiseno Mission Indians v. Schwarzenegger,
602 F.3d 1019, 1038-39 (9th Cir. 2010).
\21\ Chicken Ranch Ranchera of Me-Wuk Indians v. California, 42
F.4th 1024 (9th Cir. 2022).
---------------------------------------------------------------------------

One commenter expressed concern that, as drafted, the proposed
Sec. 293.23(b) could be construed to prohibit provisions addressing
employee licensing and back of house security requirements for non-
gaming business and amenities which in some instances may be necessary
due to proximity to gaming spaces and gaming facility design.
The Department acknowledges the comment and has included a new
provision Sec. 293.25 in the final rule clarifying that a compact may
include provisions addressing employee licensing. The Department notes
the National Indian Gaming Commission's regulations at 25 CFR part 556
and part 558 set minimum standards for background investigations and
suitability determinations for tribally-issued licenses. The final rule
includes a reference to these minimum standards as a baseline for
employee background investigations and licenses issued pursuant to a
compact to allow flexibility in the compact negotiation process while
ensuring appropriate vetting and licensing of employees.
Several commenters requested the Department make typographical and
stylistic edits to proposed Sec. 293.23(c) to improve readability of
the rule.
The Department acknowledges the comments and has accepted some of
the proposed revisions in the final rule.
A commenter requested the Department clarify if the Department will
defer to Tribes' sovereign decision making and negotiations when
applying Sec. 293.23. The commenter requested the Department include
the phrase ``the Department may consider'' to Sec. 293.23(c) and the
phrase ``and the department will defer to the Tribe regarding whether a
direct connection exists'' in Sec. 293.23(d).
The Department acknowledges the comment but declines to accept the
proposed language in the final rule.
Several commenters expressed concerns that proposed Sec.
293.23(c)(1) could be misconstrued to limit or prohibit Statewide
compacting schemes or compacts with ``most favored nation'' provisions.
A commenter offered draft language to clarify the intended reach of
Sec. 293.23(c)(1).
The Department acknowledges the comments and has made a clarifying
edit to Sec. 293.23(c)(1) in the final rule, which states, ``Expressly
limiting third party Tribes' rights to conduct gaming activities under
IGRA.'' The Department has consistently distinguished compacts with
Statewide gaming market regulatory schemes from compacts which limit
third party Tribes' rights under IGRA. In both Michigan and Arizona,
the States and the Tribes negotiated mutually beneficial agreements
addressing the location and size of Tribal gaming as part of a
Statewide scheme. These and similar compacts included Tribe-to-Tribe
revenue sharing provisions to offset market disparities between urban
and rural Tribes. These compacts are identical across the State or
contain identical relevant provisions. The Department has consistently
found these types of agreements consistent with IGRA.\22\
---------------------------------------------------------------------------

\22\ See, e.g., Letter from Ada Deer, Assistant Secretary--
Indian Affairs to Jeff Parker, Chairperson, Bay Mills Indian
Community dated November 19, 1993, approving the 1993 Michigan
Compact; Letter from Bryan Newland, Principal Deputy Assistant
Secretary--Indian Affairs, to Robert Miguel, Chairman Ak-Chin Indian
Community, dated May 21, 2021, at 2, discussing the Tribe-to-Tribe
revenue sharing and gaming device leasing provisions.
---------------------------------------------------------------------------

These are contrasted with compacts which act to prevent a Tribe who
is not party to either the compact or the broader Statewide scheme from
exercising its full rights to conduct gaming under IGRA, most notably
in the form of geographic exclusivity from Tribal competition. The
Department has consistently expressed concern with these types of
arrangements, and in some cases disapproved compacts containing such
provisions.\23\ The Department has not limited this provision in the
final rule to strictly ``anti-compete'' or ``geographic exclusivity
from Tribal competition.'' The final rule at Sec. 293.23(c)(1)
provides the Secretary flexibility when evaluating other provisions
which may also improperly limit a third-party Tribe's rights under
IGRA.
---------------------------------------------------------------------------

\23\ See, e.g., Letter from Gale Norton, Secretary of the
Interior, to Cyrus Schindler, Nation President, Seneca Nation of
Indians dated November 12, 2002, discussing the limits placed on
Tonawanda Band and the Tuscarora Nation in the Seneca Nation's
exclusivity provisions, and describing such provisions as ``anathema
to the basic notion of fairness in competition and . . .
inconsistent with the goals of IGRA''; Letter from Aurene Martin,
Assistant Secretary--Indian Affairs (acting), to Harold ``Gus''
Frank, Chairman, Forest County Potawatomi Community, dated April 25,
2003, addressing the parties removal of section XXXI.B which created
a 50 mile `no fly zone' around the Tribe's Menominee Valley facility
and explained ``we find a provision excluding other Indian gaming
anathema to basic notions of fairness in competition and
inconsistent with the goals of IGRA''; Letter from Aurene Martin,
Assistant Secretary--Indian Affairs (acting), to Troy Swallow,
President, Ho-Chunk Nation, dated August 15, 2003, addressing
section XXVII(b), limiting the Governor's ability to concur in a
two-part Secretarial Determination under section 20(b)(1)(A) of IGRA
for another Tribe as ``repugnant to the spirit of IGRA''; Letter
from Kevin Washburn, Assistant Secretary--Indian Affairs, to Harold
Frank, Chairman, Forest County Potawatomi Community dated January 9,
2013, disapproving an amendment which would have made the Menominee
Tribe guarantee Potawatomi's Menominee Valley facility profits as a
condition of the Governor's concurrence for Menominee's Kenosha two-
part Secretarial Determination, affirmed by Forest Cty. Potawatomi
Cmty. v. United States, 330 F. Supp. 3d 269 (D.D.C. 2018). See also
Letter from Bryan Newland, Assistant Secretary--Indian Affairs to
Claudia Gonzales, Chairwoman, Picayune Rancheria of Chukchansi
Indian of California, dated November 5, 2021, at 13.
---------------------------------------------------------------------------

A commenter questioned the legality and public policy rationale of
protecting third-party Tribes while not offering similar protections to
State-licensed commercial gaming operators.
The Department acknowledges the comment and notes Tribal gaming
under IGRA is a critical source of revenue for Tribal governments. The
compact negotiation process in IGRA envisions a negotiation between two
sovereigns over gaming on Indian lands and therefore does not directly
address provisions a State seeks to institute regarding non-Indian
gaming. The final rule at Sec. 293.27 addresses when it is appropriate
for a compact to include revenue sharing provisions through which a
State may also receive a source of governmental revenue. We note that
the expansion of State lotteries and State licensed commercial gaming
can place Tribes and States in direct competition for market share.
A commenter requested the Department revise proposed Sec.
293.23(c)(5) to clarify that any intergovernmental agreements
containing provisions that are not directly related to the Tribe's
gaming activities are not enforceable through a compact.
The Department acknowledges the comment but declines to include the
requested language in Sec. 293.23(c)(5) of the final rule. The
Department notes Sec. 293.30 provides a grandfather clause for
compacts previously approved by the Department. Compacts that were
approved by operation of law, also known as ``deemed approved''
compacts, are approved only to the extent they are consistent with
IGRA. 25 U.S.C. 2710(d)(8)(C). The Department takes no position on
whether a Tribe or a State may subsequently challenge compact
provisions as unenforceable or severable from the compact.
A number of commenters offered differing opinions on whether
regulations should allow, require, or prevent tort claims from being
heard in State courts. Some commenters noted the proposed Sec.
293.23(c)(7) was consistent with case law, citing to Pueblo of Santa
Ana v. Nash, 972 F. Supp. 2d 1254 (D.N.M. 2013). Other commenters
requested the Department defer to a Tribe's sovereign decision making
and amend Sec. 293.23(c)(7) to

[[Page 13244]]

allow for Tribes to request tort claims be heard in State court. Other
commenters requested the Department revise Sec. 293.23(c)(7) to
effectively prohibit the inclusion of provisions addressing tort claims
from compacts, arguing that such provisions can be overly burdensome on
Tribes, while noting that the resolution of tort claims is not
absolutely necessary for the licensing and regulation of gaming.
Commenters offered proposed edits to Sec. 293.23(c)(7) reflecting
their stances on tort claims.
The Department acknowledges the comments and notes that these
comments highlight the sensitive nature of provisions addressing tort
claims in compacts. The Department declined to revise Sec.
293.23(c)(7) in the final rule.
A commenter requested the Department revise proposed Sec.
293.23(c)(8) to include provisions that would regulate conduct outside
of the gaming spaces in addition to non-gaming Tribal economic
development.
The Department has revised Sec. 293.23(c)(8) in the final rule to
reflect the proposed revision.
Several commenters requested the Department clarify in proposed
Sec. 293.23(c)(9) that class I and class II gaming are subject to the
jurisdiction of Tribes and the United States at the exclusion of the
States. Commenters offered draft language.
The Department acknowledges the comments but declines to accept the
proposed language. The Department notes that IGRA at section 2710(a)(1)
provides that class I gaming on Indian lands is within the exclusive
jurisdiction of the Tribe and is not subject to the provisions of IGRA.
IGRA further provides that class II gaming is subject to the
jurisdiction of the Tribe and the National Indian Gaming Commission.
Comments on Sec. 293.29--Which has been redesignated as Sec. 293.26--
May a compact or amendment include provisions addressing Statewide
remote wagering or internet gaming?
The Department has redesignated proposed Sec. 293.29 as Sec.
293.26 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Several commenters requested the Department clarify, either in the
final rule or in the preamble, that players who are located on a
Tribe's Indian land must comply with IGRA when initiating an i-gaming
wager. The commenters noted that not all States or commercial i-gaming
operators are properly mapping and geo-fencing Indian lands within the
State, which could result in a player inadvertently violating IGRA and
other Federal laws by initiating a wager from the Indian lands of a
Tribe who has not authorized the placement of such wagers.
The Department acknowledges the comments and encourages Tribes who
are concerned that i-gaming wagers are being improperly initiated on
their lands and being accepted off their lands to report concerns to
the Secretary and the Department of Justice. In order for an i-gaming
wager to be legally received on a Tribe's land, the wager must comply
with both IGRA and other Federal laws, including the Unlawful internet
Gambling Enforcement Act. 31 U.S.C. 5361-67 (UIGEA). The UIGEA requires
that wagers must be legal both where they are initiated and where they
are received. See, e.g., State of Cal. v. Iipay Nation of Santa Ysabel,
898 F.3d 960, 965 (9th Cir. 2018) (internal quotations omitted).
Several commenters requested the Department provide some
flexibility to the requirement in proposed Sec. 293.26(c) that the
player initiating the wager not be located on another Tribe's land. The
commenters noted that such flexibility may result in agreements between
Tribes, through which novel solutions may emerge that allow for more
Tribes to benefit from i-gaming.
The Department acknowledges the comments and has revised Sec.
293.26(c) in the final rule to allow for wagers to be initiated on
another Tribe's Indian lands if the Tribe has provided lawful consent.
The Department also notes this is consistent with the UIGEA's exemption
for Intratribal Transactions at 31 U.S.C. 5362(10)(C).
Several commenters requested the Department amend proposed Sec.
293.26 to clarify that if a State allows any person, organization, or
entity to engage in statewide mobile gaming for any purpose, the State
is required under IGRA to negotiate with Tribes in the State to offer
statewide mobile gaming, even if the State is unwilling to allocate its
jurisdiction over wagers made by patrons located off of Indian lands to
the Tribes. The commenters offered draft language for inclusion in
proposed Sec. 293.26.
The Department acknowledges the comments but declines to include
the requested language in the final rule. Consistent with the D.C.
Circuit's 2023 decision in West Flagler Associates, Ltd. v. Haaland, 71
F.4th 1059 (D.C. Cir. 2023), a compact may include provisions
addressing regulatory issues concerning statewide mobile wagering
provided that State law authorizes the portion of the wagering
transaction occurring off of Indian lands. The Secretary, however, does
not have the authority to unilaterally require a State to allocate
jurisdiction over wagers made by patrons located off Indian lands in
the State.
Many commenters support the inclusion of proposed Sec. 293.26,
especially in the rapidly changing digital world. However, many
commenters argued Tribes already have the authority to conduct online
gaming without the language proposed Sec. 293.26. Some commenters
requested the Department include language in the proposed Sec. 293.26
to reflect that pre-existing authority.
The Department acknowledges the comments. The final rule
incorporates and codifies existing Departmental practice and, where
relevant, existing case law. Consistent with the D.C. Circuit's 2023
decision in West Flagler Associates, Ltd. v. Haaland, 71 F.4th 1059
(D.C. Cir. 2023), a compact may include provisions addressing
regulatory issues concerning statewide mobile wagering provided that
State law authorizes the portion of the wager transaction occurring off
of Indian lands.
Many non-Tribal organizations expressed deep concern about proposed
Sec. 293.26. These comments state that the Department has no authority
to implement proposed Sec. 293.26 under Chevron or the major questions
doctrine, and that this provision illegally expands Indian gaming
statewide and off-reservation.
The Department acknowledges the comments. The final rule
incorporates and codifies existing Departmental practice and, where
relevant, existing case law. Consistent with the D.C. Circuit's 2023
decision in West Flagler Associates, Ltd. v. Haaland, 71 F.4th 1059
(D.C. Cir. 2023), a compact may include provisions addressing
regulatory issues concerning statewide mobile wagering provided that
State law authorizes the portion of the wager transaction occurring off
of Indian lands.
Comments on Sec. 293.25--Which has been redesignated as Sec. 293.27--
What factors will the Secretary analyze to determine if revenue sharing
is lawful?
The Department has redesignated proposed Sec. 293.25 as Sec.
293.27 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Several commenters expressed support for the proposed Sec. 293.27,
and note it appears to codify existing Departmental practice while
incorporating Tribal consultation comments.

[[Page 13245]]

The Department acknowledges the comments.
Several commenters expressed concern that Sec. 293.27 is overly
restrictive and may result in incentivizing direct competition from
State lotteries and State licensed commercial gaming.
The Department acknowledges the comments and notes the final rule
in Sec. 293.27 codifies the Department's longstanding test for
evaluating revenue sharing. IGRA prohibits a State from seeking to
impose any tax, fee, charge, or other assessments on a Tribe's conduct
of gaming. The final rule in Sec. 293.27 addresses when it is
appropriate for a compact to include revenue sharing provisions through
which a State may also receive a source of governmental revenue.
Alternatively, States may choose to license and tax commercial gaming
operations within the State. We note the expansion of State lotteries
and State licensed commercial gaming can place Tribes and States in
direct competition for market share.
Several commenters requested the Department include examples of
previously approved ``meaningful concessions,'' similar to the lists
found in Sec. 293.23.
The Department acknowledges the comments and notes these comments
highlight the sensitive nature of revenue sharing in compacts. The
Department declines to include a list of meaningful concessions as both
the concession and the revenue sharing rate must be evaluated on a
case-by-case basis. The Department has previously approved revenue
sharing in exchange for meaningful concessions, including geographic
exclusivity from State-licensed gaming and statewide mobile or i-gaming
exclusivity.\24\ The Department cautions parties not to negotiate for a
future meaningful concession which may require intervening Federal or
State actions as that concession may be considered illusory.
---------------------------------------------------------------------------

\24\ See, e.g., Letter from Bryan Newland, Assistant Secretary--
Indian Affairs to the Honorable R. James Gessner, Jr., Chairman,
Mohegan Tribe of Indians dated September 10, 2021, approving the
Tribe's compact amendment with the State of Connecticut; and Letter
from Bryan Newland, Assistant Secretary--Indian Affairs to the
Honorable Rodney Butler, Chairman, Mashantucket Pequot Indian Tribe
dated September 10, 2021, approving the Tribe's amendment to its
Secretarial Procedures, as amended in agreement with the State of
Connecticut.
---------------------------------------------------------------------------

A commenter requested carve out language for payments to local
governments. The commenter argued that payments to local governments
are consistent with IGRA's restrictions on the use of net gaming
revenue in section 2710(b)(2)(B). The commenter argued
Intergovernmental Agreements that include revenue sharing with local
governments are beneficial to the relationship between the Tribe and
local governments and help support critical needs of both governments.
The commenter offered draft language establishing a test for such
payments:
<bullet> In considering whether a compact provision providing for
the Tribe's payment of gaming revenues to local governments is
permissible, the Department may consider evidence submitted, at the
insistence of the Tribe, that such a provision:
[cir] was created voluntarily by the Tribe;
[cir] is in exchange for benefits received by the Tribe; and/or
[cir] to offset the costs borne by such local governments as a
result of the Tribe conducting its gaming activities.
The Department acknowledges the comment. The Department declines to
accept the proposed regulatory text as it may result in unintended
consequences. The Department notes the proposed test is consistent with
past Departmental review and approval of revenue sharing provisions
that included payments to local governments. The Department also notes
intergovernmental agreements between Tribes and States, or local
governments can be beneficial; however, Congress provided a narrow
scope of topics Tribes and States may include when negotiating a
Tribal-State gaming compact. IGRA limits a Tribe's use of gaming
revenue to: funding Tribal governmental operations or programs;
providing for the general welfare of the Tribe and its members;
promoting Tribal economic development; donating to charitable
organizations; or helping fund operations of local governmental
agencies. 25 U.S.C. 2710(b)(2)(B). However, IGRA in section 2710(d)(4)
prohibits the State or its political subdivisions from imposing a tax,
fee, charge, or other assessment. The Department reads section
2710(b)(2)(B) of IGRA to permit a Tribe to voluntarily help fund
operations of local governmental agencies, not as an end-run around the
prohibition against imposed taxes, fees, charges, or other assessments
in section 2710(d)(4). The Department included payments to local
governments in Sec. Sec. 293.4, 293.8, 293.27, and 293.29, of the
final rule in an effort to address mandated intergovernmental
agreements which may disguise improper taxes.
Several commenters requested the Department clarify, either in the
regulatory text or the preamble, that exclusivity provisions which
contain enforceable remedial provisions (also referred to as ``poison
pill'' provisions) triggered by State action are considered directly
related to gaming and permitted under IGRA.
The Department acknowledges the comments and notes that revenue
sharing for geographic or game specific exclusivity from State
sponsored or State licensed commercial gaming without enforceable
remedial provisions can be considered illusory.\25\ The Department
notes the ``poison pill'' provision must also comply with Sec.
293.23(c)(1).
---------------------------------------------------------------------------

\25\ See, e.g., Letter from Kevin Foley, Assistant Secretary--
Indian Affairs to the Honorable George E. Pataki, Governor of New
York, disapproving the Tribal-State Compact between the State of New
York and the St. Regis Mohawk Tribe dated July 26, 2000.
---------------------------------------------------------------------------

A commenter requested the Department cease its practice of
approving ``exclusivity compacts,'' which limit commercial gaming
operators' access to some gaming markets.
The Department acknowledges the comment and notes Tribal gaming
under IGRA is a critical source of revenue for Tribal Governments. The
compact negotiation process in IGRA envisions a negotiation between two
sovereigns. IGRA prohibits a State from seeking to impose any tax, fee,
charge, or other assessments on a Tribes conduct of gaming. The final
rule in Sec. 293.27 addresses when it is appropriate for a compact to
include revenue sharing provisions through which a State may also
receive a source of governmental revenue. Alternatively, States may
choose to license and tax commercial gaming operations within the
State. We note the expansion of State lotteries and State licensed
commercial gaming can place Tribes and States in direct competition for
market share.
A commenter requested that the Department define the term
``projected revenue'' because most compacts with revenue sharing call
for the State to receive a percentage of gross revenue regardless of
the costs required to develop, maintain, and regulate gaming
activities. The commenter also asks the Department to analyze the need
to distinguish ``gross revenue'' from ``net revenue.'' Another
commenter requested the Department address ``free play'' and ``point
play'' as part of the revenue calculation in the regulations.
The Department acknowledges the comment but declines to define the
terms or include a discussion of ``free'' or ``point'' play in the
regulations in order to retain some flexibility in what evidence can be
submitted. The IGRA sets a benchmark that requires the Tribe

[[Page 13246]]

receive at least 60 percent of net revenue. The National Indian Gaming
Commission relies on Sole Proprietary Interest and IGRA section
2710(b)(2)(A), consistent with sections 2710(b)(4)(B)(III) and 2711(c),
which collectively require that the Tribe receive at least 60 percent
of net revenue. See, e.g., NIGC Bulletin No. 2021-6. Section
293.27(b)(3) reinforces this requirement and set an upper limit for
revenue sharing. The National Indian Gaming Commission's regulations at
25 CFR 514.4(c) provide guidance on revenue calculation.
One commenter requested the Department clarify if there is a
difference between ``great scrutiny'' and ``strict scrutiny.''
The Department acknowledges the comment. The Department's
description of its review of revenue sharing provisions has evolved
over time. Some of the Department's early revenue sharing decisions
stated, ``the Department has sharply limited the circumstances'' of
revenue sharing; that phrasing was replaced with ``great scrutiny,''
which is the standard adopted in these regulations.\26\
---------------------------------------------------------------------------

\26\ See, e.g., Letter from Gale Norton, Secretary of the
Interior, to Cyrus Schindler, Nation President, Seneca Nation of
Indians dated November 12, 2002, at 3; and Letter from Gale Norton,
Secretary of the Interior, to Christobal ``Chris'' Severs,
Chairperson, Pauma Band of Luiseno Mission Indians dated August 20,
2004, at 2; see also, Letter from Larry Echo Hawk, Assistant
Secretary--Indian Affairs to Sherry Treppa, Chairperson, Habematolel
Pomo of Upper Lake dated August 17, 2010.
---------------------------------------------------------------------------

One commenter requested adding language to allow Tribes to request
guidance from the Secretary regarding revenue sharing terms during the
life of the compact to ensure the Tribe remains the primary beneficiary
of gaming. The commenter provided draft language, which included adding
several paragraphs to Sec. 293.27. The proposed additional language
would provide a process for Tribes to request guidance letters,
including a formal legal opinion regarding revenue sharing during the
life of the compact. The Department acknowledges the comments but
declines to include the requested provisions in the final rule. The
Department has long expressed concern with relatively high revenue
sharing arrangements, often permitting compacts containing them to go
into effect by operation of law while occasionally disapproving them.
The Department's understanding of revenue sharing provisions, as well
as exclusivity provisions, has evolved consistent with case law and
experiences of Tribes operating under differing revenue sharing
provisions for more than 30 years. The Department has long offered, and
will continue to offer, technical assistance--highlighting the
Department's precedents as well as observed best practices--to parties
negotiating revenue sharing provisions. The Department notes that best
practices include careful drafting of both the terms of the Tribe's
exclusivity--or other meaningful concession--along with remedies for
breach and triggers for periodic renegotiation of specific provisions.
A commenter requested the Department include carve out language for
Tribe-to-Tribe revenue sharing but did not provide proposed regulatory
text.
The Department acknowledges the comment but declines to include a
specific carveout for Tribe-to-Tribe revenue sharing. The Department
notes there are several existing examples of compacts which contain a
Statewide gaming market regulatory scheme and include Tribe-to-Tribe
revenue sharing provisions to offset market disparities between urban
and rural Tribes. These compacts are identical across the State or
contain identical relevant provisions. The Department has consistently
found these types of agreements consistent with IGRA.\27\
---------------------------------------------------------------------------

\27\ See, e.g., Letter from Ada Deer, Assistant Secretary--
Indian Affairs to Jeff Parker, Chairperson, Bay Mills Indian
Community dated November 19, 1993, approving the 1993 Michigan
Compact; Letter from Bryan Newland, Principal Deputy Assistant
Secretary--Indian Affairs, to Robert Miguel, Chairman Ak-Chin Indian
Community, dated May 21, 2021, at 2, discussing the Tribe-to-Tribe
revenue sharing and gaming device leasing provisions.
---------------------------------------------------------------------------

Comments on Sec. 293.26--Which has been redesignated as Sec. 293.28--
May a compact or extension include provisions that limit the duration
of the compact?
The Department has redesignated proposed Sec. 293.26 as Sec.
293.28 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Many commenters expressed support for the proposed Sec. 293.28--
especially regarding the Department's preference for long-term
compacts. The commenters noted compact negotiations are a time and
resource intensive effort.
The Department acknowledges the comments.
Several commenters requested the Department define ``long-term''
and offered suggested minimum terms ranging from 15-20 years.
The Department declines to define what a ``long-term'' compact is
because that may have unintended consequences.
Other commenters requested the Department allow flexibility for
compacts with ``stacked renewal terms,'' which allow the compact to
automatically renew for a defined period of time if neither party
objects. Commenters also requested the Department include flexibility
for reopener provisions.
The Department acknowledges the comments and notes that Sec.
293.28 allows flexibility for ``stacked renewal terms'' or other
duration provisions which meet the needs of the parties. The Department
notes that a best practice includes triggers for periodic renegotiation
of specific provisions, including adding games, adjusting for
technological changes, and market conditions.
A commenter believes that proposed Sec. 293.28 will needlessly
limit compact negotiations, arguing that the proposed Sec. 293.28 is
inconsistent with prior affirmative approvals of compacts with fixed
termination dates.
The Department acknowledges the comment and notes Sec. 293.28 in
the final rule allows for compacts with fixed termination dates. The
Department notes the compact negotiation process can be lengthy and
often requires a significant investment of resources.
A commenter requested the Department clarify that the existence of
a compact between a Tribe and the State does not alleviate the State's
obligation under IGRA to negotiate new compacts or amendments in good
faith at the request of the Tribe, particularly for a period of time
not covered by the existing compact.
The Department acknowledges the comments. The Department notes IGRA
at 25 U.S.C. 2710(d)(3)(A) obligates a State to negotiate with a Tribe
in good faith at the request of the Tribe. The existence of a compact
does not absolve the State of its duty under IGRA.
Comments on Proposed Sec. 293.27--May a compact or amendment permit a
Tribe to engage in any form of class III gaming activity?
Several commenters expressed support for the proposed Sec. 293.27.
Commenters noted that the proposed Sec. 293.27 is consistent with
existing case law, citing to Mashantucket Pequot Tribe v. Connecticut,
913 F. 2d 1024 (2d Cir. 1990), which the commenter described as holding
that Congress intended to codify the test set out in California v.
Cabazon Band of Mission Indians, 480 U.S. 202 (1987). According to
these commenters, the Second Circuit concluded in the Mashantucket
Pequot case that when Congress used the phrase ``permits such gaming''
in IGRA,

[[Page 13247]]

Congress categorically refers to class III gaming. Commenters also
opined this rule would benefit Tribes during compact negotiations.
The Department acknowledges the comments and, after further
consideration and review of all comments, the Department declines to
adopt proposed Sec. 293.27 in the final rule.
Several commenters request that the Department provide additional
analysis of the Department's interpretation of conflicting caselaw to
bolster proposed Sec. 293.27 against expected litigation.
The Department acknowledges the comments, and after further
consideration, the Department declines to adopt proposed Sec. 293.27
in the final rule.
Several commenters are concerned the proposed Sec. 293.27 would
take away States' power to limit class III gaming. Commenters argued
that a State's allowance of charitable casino nights should not
necessarily result in full blown casino gambling under IGRA. Others
misconstrued the proposed Sec. 293.27 as requiring a State to
negotiate over forms of gaming expressly prohibited by State law.
Commenters also noted proposed Sec. 293.27 conflicts with some
caselaw, citing to Rumsey Indian Rancheria of Wintun Indians v. Wilson,
64 F. 3d 1250 (9th Cir. 1994) and Cheyenne River Sioux Tribe v. South
Dakota, 3 F. 3d 273 (8th Cir. 1993).
The Department acknowledges the comments, and after further
consideration, the Department declines to adopt proposed Sec. 293.27
in the final rule.
One commenter argued that the proposed Sec. 293.27 impermissibly
expands the scope of the Secretary's review of a compact to include the
compact negotiation process. The Department acknowledges the comments,
and after further consideration, the Department declines to adopt
proposed Sec. 293.27 in the final rule.
Comments on Sec. 293.28--Which has been redesignated as Sec. 293.29--
May any other contract outside of a compact regulate Indian gaming?
The Department has redesignated proposed Sec. 293.28 as Sec.
293.29 in the final rule. Comments have been edited to reflect the new
section number in the final rule.
Several commenters expressed support for proposed Sec. 293.29.
Commenters requested that the Department include internal cross
references to Sec. 293.4 and Sec. 293.8, as well as make clarifying
edits for consistency across the proposed rule.
The Department acknowledges the comments and has made edits for
clarity and consistency in the final rule and has included in Sec.
293.29 cross references to Sec. 293.4 and Sec. 293.8.
One commenter requested clarity as to what agreements the
Department may consider as regulating gaming, thus triggering Sec.
293.29. The commenter also requested the Department clarify that
agreements addressing public health and safety are allowable as either
a separate agreement, or as part of the compact.
The Department acknowledges the comment. The final rule in
Sec. Sec. 293.4, 293.8, and 293.29 provide guidance on what types of
agreements the Department is addressing. IGRA establishes a limited
scope of appropriate topics in a Tribal-State gaming compact. Thus, in
reviewing submitted compacts and amendments, the Secretary is vested
with the authority to determine whether the compacts contain topics
outside IGRA's limited scope. Agreements that do not regulate gaming do
not need to be submitted to the Department for approval as part of a
Tribal-State gaming compact. Likewise, agreements between Tribes and
the State and/or local governments that facilitate cooperation and good
governance, but that do not regulate gaming, limit a Tribe's use and
enjoyment of its lands, or require payment of gaming revenue to local
governments, should not be incorporated into or referenced as a
requirement of a Tribal-State gaming compact.
Several commenters objected to proposed Sec. 293.29 and argued
that it exceeds the Secretary's authority to review compacts under
IGRA. The commenters argue that many Tribes have intergovernmental
agreements with local governments that address a wide range of topics
which may affect a Tribe's gaming operation. The commenters argue that
such agreements should not be subject to Secretarial Review as compacts
or amendments under IGRA.
The Department acknowledges the comments and notes that Sec.
293.29 has been revised to clarify that only agreements between Tribes
and States, or States' political subdivisions, which govern gaming and
include payments from gaming revenue, are covered by this section. In
enacting IGRA, Congress delegated authority to the Secretary to review
compacts and ensure that they comply with IGRA, other provisions of
Federal law that do not relate to jurisdiction over gaming on Indian
lands, and the trust obligations of the United States. 25 U.S.C.
2710(d)(8)(B)(i)-(iii). IGRA establishes a limited scope of appropriate
topics in a Tribal-State gaming compact. Thus, in reviewing submitted
compacts and amendments, the Secretary is vested with the authority to
determine whether the compacts contain topics outside IGRA's limited
scope. IGRA limits a Tribe's use of gaming revenue to: funding Tribal
governmental operations or programs; providing for the general welfare
of the Tribe and its members; promoting Tribal economic development;
donating to charitable organizations; or helping fund operations of
local governmental agencies. 25 U.S.C. 2710(b)(2)(B). However, IGRA in
section 2710(d)(4) prohibits the State or its political subdivisions
from imposing a tax, fee, charge, or other assessment. The Department
reads section 2710(b)(2)(B) to permit a Tribe to voluntarily help fund
operations of local governmental agencies, not as an end-run around the
prohibition against imposed taxes, fees, charges, or other assessments
in section 2710(d)(4). Agreements that do not regulate gaming do not
need to be submitted to the Department for approval as part of a
Tribal-State gaming compact. Likewise, agreements between Tribes and
the State and/or local governments that facilitate cooperation and good
governance, but that do not regulate gaming or require payment of
gaming revenue to local governments, should not be incorporated into or
referenced as a requirement of a Tribal-State gaming compact.
Comments on Sec. 293.30--What effect does this part have on pending
requests, final agency decisions already issued, and future requests?
Several commenters expressed support for proposed Sec. 293.30.
The Department acknowledges the comments.
A commenter requested that this regulation include a grandfather
clause for currently valid compacts.
The Department acknowledges the comment and notes the final rule in
Sec. 293.30(b) contains a grandfather clause and states that part 293
does not alter final agency decisions made pursuant to this part before
March 22, 2024.
Comments on Sec. 293.31--How does the Paperwork Reduction Act affect
this part?
No comments were submitted regarding proposed Sec. 293.30.

[[Page 13248]]

General Comments Not Otherwise Addressed Above
Various commenters requested more time to comment on the
regulations.
The Department acknowledges the comment and notes that the
Department issued a Dear Tribal Leaders letter with an attached
Consultation Draft of Proposed Changes to part 293 on March 28, 2022.
The letter and Consultation Draft were made publicly available on the
Department's website at <a href="https://www.bia.gov/as-ia/oig">https://www.bia.gov/as-ia/oig</a>. The Department
then held two listening sessions, four formal consultation sessions,
and accepted written comments until June 30, 2022. The Department
incorporated Tribal feedback into the proposed rule and included a
summary and responded to comments received during Tribal Consultation
in the Department's Notice of proposed rulemaking. Additionally, the
Department published a follow up Dear Tribal Leaders letter on December
6, 2022, held two virtual consultation sessions and one in-person
consultation, and accepted written comments until March 1, 2023. The
Department received written and verbal comments from over 56 entities
during the public comment period on part 293. Commenters included
members of Congress; Tribal, State, and local governments; Tribal and
commercial gaming industry organizations; and individual citizens. In
total, the submissions were separated into 607 individual comments.
Many Tribes commented to express appreciation for the hard work and
consideration exhibited in the Notice of proposed rulemaking. Many
Tribes also stated the Proposed Regulations are a step in the right
direction, but do not go far enough to protect Tribal sovereignty and
Indian gaming.
The Department acknowledges the comments.
Some non-Tribal commenters commented to discourage any allowance of
Indian gaming.
The Department acknowledges the comments and notes IGRA provides
statutory limits on Tribes' sovereign right to conduct gaming.
One commenter requested the Department publish a gaming handbook.
The Department is in the process of finalizing a handbook
addressing the Department's part 292 regulations (25 CFR part 292),
which implement IGRA's exceptions to its general prohibition on the
conduct of gaming on lands acquired in trust after October 17, 1988,
and revisions to the fee-to-trust regulations in part 151. The
Department's part 292 regulations were promulgated in 2008 and are not
impacted by this rule making or the Department's part 151 rulemaking.
Several commenters stated the process was not transparent and that
Tribes received unfair special treatment. They suggest releasing
detailed records of Tribal comments from June 2022. Some commenters
asked if the Department had engaged with commercial gaming interests in
addition to Tribal governments during the development of the proposed
rule.
The Department followed the procedures outlined in the
Administrative Procedure Act at 5 U.S.C. 553, 556, and 557, as well as
relevant White House, Congressional, and Departmental policies on
Tribal consultations. The Department's part 293 regulations address the
Tribal-State gaming compact review and approval process. The
Department's Notice of proposed rulemaking contained a detailed summary
and response to comments received during the Tribal Consultation
process. The Department also posted a copy of the Tribal Consultation
materials on the BIA's public Tribal-Consultations website, including a
copy of the Dear Tribal Leader Letter, consultation dates, and
transcripts of the consultation sessions. See <a href="https://www.bia.gov/service/tribal-consultations/nprm-25-cfr-151-land-acquisitions-and-25-cfr-293-class-iii-tribal">https://www.bia.gov/service/tribal-consultations/nprm-25-cfr-151-land-acquisitions-and-25-cfr-293-class-iii-tribal</a>.
One commenter requested a process for Tribes to seek Department of
Justice intervention as part of a Seminole fix.
The Department declines to adopt a formal codification of its
practice of providing technical assistance to Tribes and States. The
Department will continue to coordinate with the Department of Justice
and the National Indian Gaming Commission regarding enforcement of
IGRA.
Some Tribes believe that the proposed changes to part 293 will be
hollow without changes to part 291.
The Department notes that a minority of Federal circuits have
invalidated the Department's part 291 regulations (25 CFR part 291),
which were promulgated to provide Tribes with Secretarial Procedures in
response to the Supreme Court's decision in Seminole Tribe of Florida
v. Florida, 517 U.S. 44 (1996), which found that Congress lacked the
authority to subject States to suits by Indian Tribes under IGRA. The
Department is considering all avenues, including technical amendments
to part 291. The proposed rule reflects the Department's efforts to
ensure all Tribes benefit from the goals of IGRA, while enforcing
IGRA's limited scope of compacts. The inclusion of clear guidance and
codification of key tests is a step in this direction. The Department
declines to codify a formal process by which Tribes may submit evidence
of bad faith in negotiations to the Department for its consideration
and referral to the Department of Justice. The Department has long
coordinated with the Department of Justice and the National Indian
Gaming Commission regarding enforcement or non-enforcement of IGRA's
requirement that a Tribe conduct class III gaming pursuant to a compact
or secretarial procedures. See, e.g., Statement of Indian Gaming in New
Mexico, DOJ 95-459 (August 28, 1995); Statement of Indian Gaming in New
Mexico, DOJ 95-553 (October 27, 1995); and Justice Department and
California announce plan for orderly transition to legal Indian Gaming,
DOJ 98-102 (March 6, 1998). The Department will continue to coordinate
with the Department of Justice and the National Indian Gaming
Commission regarding enforcement of IGRA.
Some non-Tribal commenters believe the Department has failed to
conduct a detailed review of the economic effects of the proposed rule
despite being required to conduct one under the law. Additionally,
these commenters believe a NEPA analysis must be undertaken before
adopting a final rule.
The Department acknowledges the comments and notes that the final
rule codifies existing case law and Departmental process. The
Department notes comments suggesting specific economic impacts of the
proposed rule contained material misrepresentations of the effect of
the proposed rule and conflated the Department's part 293 rulemaking
with the Department's part 151 fee-to-trust rulemaking efforts as part
of the assessment of economic impacts of the rule (25 CFR part 151).
The Department also notes that the notice of proposed rulemaking
addressed the Department's compliance with NEPA.
One commenter believes the Department is asserting too much
authority in a way that challenges Tribal sovereignty.
The Department acknowledges the comment and notes that the
Department strives to strengthen its government-to-government
relationship with Tribes and recognizes their right to self-governance
and Tribal sovereignty.
Several commenters asked various process and implementation
questions. Other commenters included comments addressing the
Department's part 151 fee-to-trust rulemaking efforts.
The Department addressed the comments on the proposed 25 CFR part
151 in the part 151 rulemaking

[[Page 13249]]

published December 12, 2023, at 88 FR 86222.

V. Summary of Changes by Section

The Department primarily proposed technical amendments to the
existing process-based regulations, including the title. The proposed
technical amendments are intended to clarify the submission and review
process and conforming edits for internal consistency and improved
readability. The Department also proposed to add 15 sections addressing
substantive issues and to organize part 293 into 4 subparts. The
Department proposed to amend the title of part 293 by removing the word
``process'' from the title to read: ``Part 293 Class III Tribal State
Gaming Compacts.'' The Department's proposed amendments incorporated
comments on the Consultation Draft that were received during Tribal
consultation and were discussed in the notice of proposed rulemaking.
The Department makes these changes in the final rule. The final rule
incorporates comments received during the public comment period and
during Tribal consultation on the proposed rule, and as discussed above
in the summary and response to comments section.

A. Subpart A--General Provisions and Scope

The Department proposed to organize part 293 into 4 subparts with
subpart A, titled ``General Provisions and Scope'' containing
Sec. Sec. 293.1 through 293.5. The Department implements this
organizational change in the final rule.
Amendments to Sec. 293.1--What is the purpose of this part?
The Department proposed technical amendments to clarify that the
proposed part 293 regulations contain both procedural and substantive
regulations for the submission and review of Tribal-State gaming
compacts. The Department implements this change in the final rule with
additional clarifying edits to improve readability.
Amendments to Sec. 293.2--How are key terms defined in this part?
The Department proposed restructuring the existing Sec. 293.2 by
removing the subsection paragraph for the introductory sentence and
editing that sentence for clarity. The restructuring improves clarity
by using subsection paragraphs for each defined term. The Department
proposed edits to the existing definitions for Amendment, Compact or
Tribal-State Gaming Compact, and Extension to improve clarity and
respond to comments received during the government-to-government Tribal
consultation process. The Department also proposed seven new
definitions: gaming activity or gaming activities, gaming facility,
gaming spaces, IGRA, meaningful concession, substantial economic
benefit, and Tribe. The Department implements these changes in the
final rule with additional clarifying edits in response to comments
received during the public comment period. Each defined term is
discussed below:
<bullet> Amendment is a defined term in the 2008 Regulations. The
Department proposed a clarifying revision to the definition, as well as
adding a new Sec. 293.2(a)(2) addressing agreements between a Tribe
and a State to change the Tribe's Secretarial Procedures prescribed
under 25 U.S.C. 2710(d)(7)(B)(vii). The Department implements these
changes in the final rule.
<bullet> Compact or Tribal-State Gaming Compact is a defined term
in the 2008 Regulations. The Department proposed clarifying and
conforming edits to the definition. The Department implements these
changes in the final rule.
<bullet> Extension is a defined term in the 2008 Regulations. The
Department proposed clarifying and conforming edits to the definition.
The Department implements these changes in the final rule.
<bullet> Gaming activity or gaming activities are interchangeable
terms repeatedly used in IGRA, but not defined by IGRA or the
Department's 2008 Regulations. The Department proposed defining these
terms as used in part 293 and in Tribal-State gaming compacts as, ``the
conduct of class III gaming involving the three required elements of
chance, consideration, and prize.'' The Department includes this
definition in the final rule.
<bullet> Gaming Facility is a term used in IGRA at 25 U.S.C.
2710(d)(3)(C)(vi) but is not defined by IGRA. The IGRA permits a
compact to include ``standards for the operation of such activity and
maintenance of the gaming facility, including licensing.'' As a result,
compacting parties have occasionally used this provision to extend
State regulatory standards beyond the maintenance and licensing of the
physical structure where the Tribe is conducting gaming. The Department
proposed defining gaming facility as ``the physical building or
structure situated on Indian lands where the gaming activity occurs.''
\28\ This definition of gaming facility addresses building maintenance
and licensing under the second clause of 25 U.S.C. 2710(d)(3)(C)(vi)
and is intended to be narrowly applied to only the building or
structure where the gaming activity occurs. The Department includes
this definition in the final rule.
---------------------------------------------------------------------------

\28\ See, e.g., Letter to the Honorable Peter S. Yucupicio,
Chairman, Pascua Yaqui Tribe of Arizona, from the Director, Office
of Indian Gaming, dated June 15, 2012, at 5, and fn. 9, discussing
the American Recovery & Reinvestment Act of 2009 and the IRS's
``safe harbor'' language.
---------------------------------------------------------------------------

<bullet> Gaming spaces is a term that the Department has used to
clarify the physical spaces a compact may regulate. The Department
proposed defining Gaming Spaces in the proposed rule and notes that
proposed definition contained a typographical error. The Department
includes Gaming Spaces as a defined term in the final rule with edits
to correct the typographical error.
<bullet> IGRA is the commonly used acronym for the Indian Gaming
Regulatory Act of 1988 (Pub. L. 100-497) 102 Stat. 2467 dated October
17, 1988, (Codified at 25 U.S.C. 2701-2721 (1988)) and any amendments.
The Department proposed including IGRA as a defined term to facilitate
consistency and readability in the regulations. The Department includes
this definition in the final rule.
<bullet> Meaningful concession is a term that the Department has
adopted from Ninth Circuit case law as part of the Department's long-
standing test for revenue sharing provisions. The Department proposed
including meaningful concession as a defined term. The Department
includes meaningful concession as a defined term. The Department
revised the definition of meaningful concession in Sec. 293.2(h)(2) of
the final rule by adding the word ``activity'' in response to comments
received on the proposed rule. The final rule defines Meaningful
concession as:
[cir] Something of value to the Tribe;
[cir] Directly related to gaming activity;
[cir] Something that carries out the purposes of IGRA; and
[cir] Not a subject over which a State is otherwise obligated to
negotiate under IGRA.
<bullet> Substantial economic benefit is a term that the Department
has adopted from Ninth Circuit case law as part of the Department's
long-standing test for revenue sharing provisions. The Department
proposed (and includes in the final rule) defining substantial economic
benefit as:
[cir] A beneficial impact to the Tribe;
[cir] Resulting from a meaningful concession;
[cir] Made with a Tribe's economic circumstances in mind;
[cir] Spans the life of the compact; and

[[Page 13250]]

[cir] Demonstrated by an economic/market analysis or similar
documentation submitted by the Tribe or the State.
<bullet> Tribe is a term the Department proposed as a defined term
to facilitate consistency and readability in the regulations. The
Department includes this definition in the final rule.
Amendments to Sec. 293.3--What authority does the Secretary have to
approve or disapprove compacts and amendments?
The Department proposed clarifying and conforming edits to the
existing Sec. 293.3. The Department implements these changes in the
final rule and has added the phrase ``under IGRA'' to the first
sentence of Sec. 293.3.
Amendments to Sec. 293.4--Are compacts and amendments subject to
review and approval?
The Department proposed clarifying edits to the existing Sec.
293.4 by combining paragraphs (a) and (b) from the 2008 Regulations
into a new paragraph (a), adding a new paragraph (b) which was proposed
during Tribal consultation, and adding a new paragraph (c) which
creates a process by which the parties may seek a determination if an
agreement or other documentation is a ``compact or amendment'' without
submitting that agreement for review and approval pursuant to IGRA.
This process is modeled on the National Indian Gaming Commission's
practice of issuing declination letters for agreements which do not
trigger the Chairman's review and approval of management contracts as
required by IGRA at 25 U.S.C. 2711.
The Department implements these changes in the final rule with
additional clarifying edits in response to comments received during the
public comment period. These revisions include changes to the sentence
structure in Sec. 293.4(b)(1) through (4) for improved clarity
including duplicative phrasing and starting each subsection sentence
with a verb, and revisions to Sec. 293.4(c) to clarify when the 30-day
review period begins. The Department has also revised the timeline for
a Sec. 293.4(c) determination from 60 days to 30 days in response to
comments received, and for consistency with 25 CFR 84.005, which
implements the Departments review of ``section 81'' contracts. The
Department has also included a clarification that if an agreement is
determined to be a compact or amendment, it must be resubmitted for
Secretarial review and approval.
Amendments to Sec. 293.5--Are extensions to compacts subject to review
and approval?
The Department proposed clarifying and conforming edits for
consistency and readability to the existing Sec. 293.5. The Department
also proposed adding a sentence which codifies the Department's long-
standing practice that notice of an extension must be published in the
Federal Register to be in effect.\29\ The Department implements these
changes in the final rule with a conforming edit to the citation to
Sec. 293.8(a) through (c).
---------------------------------------------------------------------------

\29\ See, e.g., final rule, 25 CFR part 293, 73 FR 74004, 74007
(Dec. 5, 2008).
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B. Proposed Subpart B--Submission of Tribal-State Gaming Compacts

The Department proposed to organize part 293 into 4 subparts with
subpart B, titled ``Submission of Tribal-State Gaming Compacts''
containing Sec. Sec. 293.6 through 293.9. The Department implements
this organizational change in the final rule.
Amendments to Sec. 293.6--Who can submit a compact or amendment?
The Department proposed a conforming edit for consistency to Sec.
293.6. The Department implements this change in the final rule.
Amendments to Sec. 293.7--When should the Tribe or State submit a
compact or amendment for review and approval?
The Department proposed conforming edits for consistency to both
the heading and the body of Sec. 293.7. The Department implements
these changes in the final rule.
Amendments to Sec. 293.8--What documents must be submitted with a
compact or amendment?
The Department proposed conforming edits for consistency to Sec.
293.8. Additionally, the Department proposed to renumber the existing
paragraphs and add a new paragraph (d). The proposed paragraph (d)
clarifies that a compact submission package should include any
agreements between the Tribe and the State, or its political
subdivisions, which are required by the compact or amendment and either
involve payments made by the Tribe from gaming revenue, or restricts or
regulates the Tribe's use and enjoyment of its Indian lands, as well as
any ancillary agreements, documents, ordinances, or laws required by
the compact which the Tribe determines is relevant to the Secretary's
review. The Department's review of the compact includes analyzing if
the provision(s) requiring ancillary agreements, documents, ordinances,
or laws violate IGRA or other Federal law because the underlying
agreement includes provisions prohibited by IGRA, and therefore the
Secretary may disapprove the compact.
The Department incorporates the proposed changes to Sec. 293.8
with additional clarifying and conforming edits in the final rule.
Amendments to Sec. 293.9--Where should a compact or amendment be
submitted for review and approval?
The Department proposed conforming edits for consistency to Sec.
293.9 and a proposed new sentence to permit electronic submission of
compacts. The Office of Indian Gaming will accept and date stamp
electronic submissions for the purpose of initiating the 45-day review
period. The first copy of a compact or amendment that is received and
date stamped initiates the 45-day review period. The Department notes,
however, that Sec. 293.8(a) requires submission of at least one
original paper copy of the fully executed compact or amendment if the
compact or amendment was submitted electronically and the compact or
amendment was executed utilizing ``wet'' or ink signatures. The
Department will accept digitally signed original copies provided
digital signatures are consistent with applicable Tribal and State law.
The Department implements these changes in the final rule.

C. Proposed Subpart C--Secretarial Review of Tribal-State Gaming
Compacts

The Department proposed to organize part 293 into 4 subparts with
subpart C, titled ``Secretarial Review of Tribal-State Gaming
Compacts'' containing Sec. Sec. 293.10 through 293.16. The proposed
change included renumbering the existing Sec. 293.14 When may the
Secretary disapprove a compact or amendment? as Sec. 293.16;
renumbering and renaming the existing Sec. 293.15 When does an
approved or considered-to-have-been-approved compact or amendment take
effect? as Sec. 293.14 When does a compact or amendment take effect?;
and adding a new Sec. 293.15 Is the Secretary required to disapprove a
compact or amendment that violates IGRA?. The Department implements
these organizational changes in the final rule. The Department after
further consideration declines to adopt proposed Sec. 293.15 in the
final rule. The existing Sec. 293.14 When may the Secretary disapprove
a compact or amendment? is redesignated as Sec. 293.15 in the final
rule.

[[Page 13251]]

Amendments to Sec. 293.10--How long will the Secretary take to review
a compact or amendment?
The Department proposed a conforming edit to Sec. 293.10 for
consistency. The Department implements this change in the final rule.
Amendments to Sec. 293.11--When will the 45-day timeline begin?
The Department proposed conforming edits to Sec. 293.11 for
consistency with proposed changes to Sec. 293.9, and a new sentence
providing the Department will provide an email acknowledgement to the
Tribe and the State of receipt and provide the date of the 45th day for
electronically submitted compacts or amendments. The Department
implements these changes, along with clarifying edits to Sec. 293.11,
in the final rule.
Amendments to Sec. 293.12--What happens if the Secretary does not act
on the compact or amendment within the 45-day review period?
The Department proposed clarifying edits to Sec. 293.12 for
consistency and readability. Additionally, the Department proposed a
new provision codifying the Department's practice of issuing
ministerial letters that inform the parties that the compact or
amendment has been approved by operation of law after the 45th day. The
proposed Sec. 293.12, also codifies the Department's practice of
occasionally including guidance to the parties, reflecting the
Department's interpretation of IGRA--also known as ``Deemed Approved''
Letters. The Department implements these changes in the final rule.
Amendments to Sec. 293.13--Who can withdraw a compact or amendment
after it has been received by the Secretary?
The Department proposed conforming edits to Sec. 293.13 for
consistency. The Department implements these changes in the final rule.
Amendments to Sec. 293.14--When does a compact or amendment that is
affirmatively approved or approved by operation of law take effect?
The Department proposed redesignating the existing Sec. 293.15 as
Sec. 293.14 to improve overall organization of the regulations. The
Department also proposed clarifying and conforming edits for
consistency and readability to both the heading and the body of Sec.
293.14. The Department implements these changes in the final rule.
Sec. 293.15--When may the Secretary disapprove a compact or amendment?
The Department proposed redesignating and restructuring the
existing Sec. 293.14 as Sec. 293.16 to improve the overall
organization of the regulations, for the reasons stated above it is
designated as Sec. 293.15 in the final rule. Additionally, the
Department proposed to renumber the existing paragraphs and add a new
paragraph (b). The proposed paragraph (b) would clarify that if a
compact submission package is missing the documents required by Sec.
293.8 and the parties decline to cure the deficiency, the Secretary may
conclude that the compact or amendment was not ``entered into'' by the
Tribe and State as required by IGRA, 25 U.S.C. 2710(d)(1)(C) and will
disapprove the compact or amendment on that basis. See, e.g., Pueblo of
Santa Ana v. Kelly, 104 F.3d 1546, 1555 (10th Cir. 1997) (a compact or
amendment must have been ``validly entered into'' before it can go into
effect through Secretarial approval). The Department notes this is a
change from an earlier practice of ``returning'' incomplete compact
submission packages. The Department has reconsidered this practice so
as to better fulfill Congress's goal of avoiding unnecessary delay in
the Secretary's review process. If the Department cannot determine,
based on the lack of documentation, that the compact was validly
entered into, then approval--affirmative or by operation of law--
exceeds the Secretary's authority. The Department implements these
changes in the final rule, and in response to comments received has
added clarifying language stating it provided the parties with an
opportunity to supply those documents, the Secretary may conclude the
compact or amendment was not validly entered into between the Tribe and
the State and will disapprove the compact or amendment on those
grounds.

D. Proposed Subpart D--Scope of Tribal-State Gaming Compacts

The Department proposed to organize part 293 into 4 subparts with
subpart D, titled ``Scope of Tribal-State Gaming Compacts'' containing
Sec. Sec. 293.17 through 293.31. The Department proposed substantive
provisions that address the appropriate scope of a compact under IGRA.
These provisions continue the question-and-answer approach utilized in
the existing regulations. These provisions codify existing Departmental
practice and provide compacting parties with clear guidance on the
appropriate scope of compact negotiations. The Department implements
this organizational change, and consistent with the proposed rule,
codifies the new substantive provisions in the final rule. These
provisions are renumbered in the final rule consistent with the removal
of Sec. 293.15.
In response to comments received on the proposed rule, the
Department has added two new sections in the final rule. The first is
numbered Sec. 293.24 and addresses rights of employees. The second is
numbered Sec. 293.25 and addresses licensing of employees. The
Department also redesignated proposed Sec. 293.29 as Sec. 293.26.
Proposed Sec. Sec. 293.25 and 293.26 have been redesignated in the
final rule as Sec. Sec. 293.27 and 293.28 respectively. The Department
after further consideration declines to adopt proposed Sec. 293.27 in
the final rule. Proposed Sec. 293.28 has been redesignated in the
final rule as Sec. 2 93.29. Proposed Sec. Sec. 293.30 and 293.31
retain these section numbers in the final rule. The Department makes
this organizational change so that two provisions courts have
determined are ``directly related to the operation of gaming
activities'' are positioned with the Department's other sections
addressing 25 U.S.C. 2710(d)(3)(C)(vii). The new Sec. 293.24 titled
``May a compact or amendment include provisions addressing rights of
employees?'' codifies case law and the Department's precedent that a
compact may include provisions addressing rights of employees that have
a direct connection to the operation of gaming activity. The new Sec.
293.25 titled ``May a compact or amendment include provisions
addressing employee licensing?'' clarifies, consistent with IGRA and
the National Indian Gaming Commission's regulations, that compacts may
include provisions addressing employee licensing. The redesignated
Sec. 293.26 titled ``May a compact or amendment include provisions
addressing Statewide remote wagering or internet gaming?'' consistent
with West Flagler, codifies the Department's positions that the
negotiation between a Tribe and State over Statewide remote wagering or
i-gaming falls under these broad categories of criminal and civil
jurisdiction and is inherently directly related to the operation of
gaming.
Sec. 293.16--May a compact include provisions addressing the
application of the Tribe's or State's criminal and civil laws and
regulations?
The Department has redesignated proposed Sec. 293.17 as Sec.
293.16 in the final rule for the reasons explained above in the summary
of changes to

[[Page 13252]]

subpart D. This summary reflects the final rule section number.
The Department proposed a new Sec. 293.16, clarifying the
appropriate scope of terms that address the application of the criminal
and civil laws and regulations in a compact. Congress, through IGRA at
25 U.S.C. 2710(d)(3)(C)(i), provided that, to the extent permitted by
law, a compact may include provisions addressing the application of
criminal and civil laws and regulations of the Tribe or the State that
are directly related to, and necessary for, the licensing and
regulation of the gaming activity. The Department codifies Sec. 293.16
in the final rule with an edit to the reference to Sec. 293.8 for
constancy with revisions made to that section.
Sec. 293.17--May a compact include provisions addressing the
allocation of criminal and civil jurisdiction between the Tribe and the
State?
The Department has redesignated proposed Sec. 293.18 as Sec.
293.17 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.17, clarifying the
appropriate scope of terms addressing the allocation of Tribal and
State criminal and civil jurisdiction in a compact. Congress, through
IGRA at 25 U.S.C. 2701(5), found that ``[T]ribes have the exclusive
right to regulate gaming activity on Indian lands if the gaming
activity is not specifically prohibited by Federal law and is conducted
within a State which does not, as a matter of criminal law and public
policy, prohibit such gaming activity.'' Congress then provided that a
compact may include provisions addressing the allocation of criminal
and civil jurisdiction between the Tribe and the State that are
necessary for the enforcement of laws and regulations described in
section 2710(d)(3)(C)(ii). We note that a compact or compact amendment
may not, however, alter otherwise applicable Federal law. The
Department codifies Sec. 293.17 in the final rule with conforming
edits to the title and text for consistency with other provisions in
part 293.
Sec. 293.18--May a compact include provisions addressing the State's
costs for regulating gaming activities?
The Department has redesignated proposed Sec. 293.19 as Sec.
293.18 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.18, clarifying the
appropriate scope of assessments by the State to defray the costs of
regulating the Tribe's gaming activity. Congress, through IGRA at 25
U.S.C. 2710(d)(3)(C)(iii), provided that a compact may include
provisions relating to the assessment by the State of the gaming
activity in amounts necessary to defray the costs of regulating the
gaming activity. Congress, through IGRA at 25 U.S.C. 2710(d)(4),
clarified that any assessments must be negotiated, and at no point may
a State or its political subdivisions impose any taxes, fees, charges,
or other assessments upon a Tribe through the compact negotiations. The
Department's proposed new section clarifies that the compact should
include requirements for the State to show actual and reasonable
expenses over the life of the compact, and that the absence of such
provisions may be considered evidence of a violation of IGRA. The
Department codifies Sec. 293.18 in the final rule, and in response to
comments received has added the phrase ``the lack of such a requirement
shall be'' to the final sentence of Sec. 293.18.
Sec. 293.19--May a compact include provisions addressing the Tribe's
taxation of gaming?
The Department has redesignated proposed Sec. 293.20 as Sec.
293.19 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.19 clarifying the
appropriate scope of provisions that address a Tribe's taxation of
tribally licensed gaming activity. Congress, through IGRA at 25 U.S.C.
2710(d)(3)(C)(iv), provided that a compact may include provisions
relating to the Tribe's taxation of gaming activities in amounts
comparable to the State's taxation of gambling. A Tribal-State gaming
compact may not be used to address the Tribe's taxation of other
activities that may occur within or near the Tribe's gaming facility.
The inclusion of provisions addressing the Tribe's taxation of other
activities may be considered evidence of a violation of IGRA. The
Department codifies Sec. 293.19 in the final rule with a conforming
edit.
Sec. 293.20--May a compact or amendment include provisions addressing
the resolution of disputes for breach of the compact?
The Department has redesignated proposed Sec. 293.21 as Sec.
293.20 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.20, clarifying the
appropriate scope of provisions addressing remedies for breach of the
compact. Congress, through IGRA at 25 U.S.C. 2710(d)(3)(C)(v), provided
that a compact may include provisions relating to remedies for breach
of contract. Compacts often include alternative dispute resolution,
including binding arbitration, as part of the parties' remedies for
allegations of breach of contract. Despite the Department's existing
regulations clarifying that compacts and all amendments are subject to
Secretarial review, some compacting parties have resolved disputes in
manners which seek to avoid Secretarial review. The Department proposed
Sec. 293.20 to clarify that any dispute resolution agreement,
arbitration award, settlement agreement, or other resolution of a
dispute outside of Federal court must be submitted for review and
approval by the Secretary. Further, the proposed Sec. 293.20
references the Sec. 293.4 determination process for review, prior to a
formal submission of a dispute resolution agreement as an amendment.
The inclusion of provisions addressing dispute resolution in a manner
that seeks to avoid the Secretary's review may be considered evidence
of a violation of IGRA. The Department codifies Sec. 293.20 in the
final rule.
Sec. 293.21--May a compact or amendment include provisions addressing
standards for the operation of gaming activity and maintenance of the
gaming facility?
The Department has redesignated proposed Sec. 293.22 as Sec.
293.21 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.21, clarifying the
appropriate scope of provisions addressing the Tribe's standards for
the operation of the gaming activity, as well as the Tribe's standards
for the maintenance of the gaming facility, including licensing in a
compact. Congress, through IGRA at 25 U.S.C. 2710(d)(3)(C)(vi),
provided that a compact may include provisions relating to standards
for the operation of such activity and maintenance of the gaming
facility, including licensing. The Department interprets section
2710(d)(3)(C)(vi) narrowly and as two separate clauses addressing
separate Tribal and State interests. First, a compact may include
provisions addressing the standards for the operation and licensing of
the gaming

[[Page 13253]]

activity. Second, a compact may include provisions addressing the
maintenance and licensing of the gaming facility building or structure.
The final rule in Sec. 293.2 includes definitions of both gaming
facility and gaming spaces to provide parties with clarity regarding
the appropriate limits of a State's oversight under IGRA. Any compact
provisions addressing the maintenance and licensing of a building or
structure must be limited to the building or structure situated on
Indian lands where the gaming activity occurs--the gaming facility.
Further, if a compact or amendment mandates that the Tribe adopt
standards equivalent or comparable to the standards set forth in a
State law or regulation, the parties must show that these mandated
Tribal standards are both directly related to and necessary for the
licensing and regulation of the gaming activity. The Department
codifies Sec. 293.21 in the final rule, and in response to comments
received, has added the phrase ``within gaming spaces'' to the second
sentence.
Sec. 293.22--May a compact or amendment include provisions that are
directly related to the operation of gaming activities?
The Department has redesignated proposed Sec. 293.23 as Sec.
293.22 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.22, clarifying that a
compact may include provisions that are directly related to the
operation of gaming activities. Congress, through IGRA at 25 U.S.C.
2710(d)(3)(C)(vii), provided that a compact may include provisions
relating to any other subjects that are directly related to the
operation of gaming activities, including activities occurring off
Indian lands. The Department also proposed a new Sec. 293.23,
codifying the Department's longstanding narrow interpretation of
section 2710(d)(3)(C)(vi). The Department codifies Sec. 293.22 in the
final rule.
Sec. 293.23--What factors will be used to determine whether provisions
in a compact or amendment are directly related to the operation of
gaming activities?
The Department has redesignated proposed Sec. 293.24 as Sec.
293.23 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.23, codifying existing case
law and the Department's longstanding narrow interpretation of section
2710(d)(3)(C)(vi) of IGRA as requiring a ``direct connection.'' The
Department notes that the Ninth Circuit in Chicken Ranch found the
Department's longstanding direct connection test persuasive and
consistent with the Court's own independent analysis of IGRA and case
law. The proposed Sec. 293.23 provides compacting parties with
examples of provisions which have a direct connection to the Tribe's
conduct of class III gaming activities, as well as examples the
Department has found that do not satisfy the direct connection test.
The Department codifies Sec. 293.23 in the final rule, and in response
to comments received has made some clarifying edits.
Sec. 293.24--May a compact or amendment include provisions addressing
the rights of employees?
In response to comments received on the proposed rule, the
Department has added a new Sec. 293.24, which addresses organizational
and representational rights of employees in the final rule. This
provision continues the question-and-answer approach utilized in the
existing regulations and the remainder of the final rule. The new Sec.
293.24 titled ``May a compact or amendment include provisions
addressing rights of employees?'' The text of Sec. 293.24 states that,
yes, notwithstanding Sec. 293.23(c)(8), a compact or amendment may
include provisions or procedures addressing the organizational and
representational rights of employees, including service or hospitality
workers, where such provisions or procedures are ``directly related''
to the operation of gaming activities as articulated by the Ninth
Circuit in Chicken Ranch Rancheria of Me-Wuk Indians v. California, 42
F.4th 1024, 1035-1040 & n.2 (citing Coyote Valley Band of Pomo Indians
v. California (In re Indian Gaming Related Cases Chemehuevi Indian
Tribe), 331 F.3d 1094, 1116 (9th Cir. 2003)). The Department notes this
provision codifies case law that a compact may include provisions
addressing organizational and representational rights of employees.
Sec. 293.25--May a compact or amendment include provisions addressing
employee licensing?
In response to comments received on the proposed rule, the
Department has added a new Sec. 293.25, which addresses standards for
employee licensing. The Department notes the National Indian Gaming
Commission's regulations at 25 CFR part 556 and part 558 set minimum
standards for background investigations and suitability determinations
for tribally issued licenses. The final rule includes a reference to
these minimum standards as a baseline for employee background
investigations and licenses issued pursuant to a compact to allow
flexibility in the compact negotiation process while ensuring
appropriate vetting and licensing of employees.
Sec. 293.26--May a compact or amendment include provisions addressing
Statewide remote wagering or internet gaming?
The Department has redesignated proposed Sec. 293.29 as Sec.
293.26 in the final rule for the reasons explained above in the summary
of changes to subpart D. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.26, which clarifies that a
compact may include provisions allocating jurisdiction to address
Statewide remote wagering or internet gaming. The IGRA provides that a
Tribe and State may negotiate for ``the application of the criminal and
civil laws and regulations of the Indian Tribe or the State that are
directly related to, and necessary for, the licensing and regulation of
such activity'' and ``the allocation of criminal and civil jurisdiction
between the State and the Indian Tribe necessary for the enforcement of
such laws and regulations.'' 25 U.S.C. 2710(d)(3)(c)(i)-(ii). The IGRA
also provides that a Tribe and State may negotiate over ``any other
subjects that are directly related to the operation of gaming
activities.'' 25 U.S.C. 2710(d)(3)(c)(vii). The Department's position,
consistent with the D.C. Circuit's decision in West Flagler Associates,
Ltd. v. Haaland, 71 F. 4th 1059 (D.C. Cir. 2023), is that Tribes and
States may negotiate, consistent with IGRA and other Federal law, over
how wagers placed outside Indian land within a State and received by a
Tribe on Indian lands are treated for purposes of State and Tribal law,
and how regulation of such activity is allocated between Tribes and
States. Such topics fall under these broad categories of criminal and
civil jurisdiction and such wagering is inherently directly related to
the operation of gaming. Accordingly, provided that a player is not
physically located on another Tribe's Indian lands, a Tribe should have
the opportunity to engage in this type of gaming pursuant to a Tribal-
State gaming compact. The Department notes that the ultimate legality
of gaming activity occurring off Indian lands remains a question of
State law, notwithstanding that a compact discusses the activity.
However, in enacting IGRA, Congress did not contemplate the Department
would

[[Page 13254]]

address or resolve complex issues of State law during the 45-day review
period,\30\ and such issues are outside the scope of the Secretary's
review. West Flagler, 71 F. 4th at 1065. Further, non-IGRA Federal law
may also place restrictions on that activity. The Department codifies
Sec. 293.26 in the final rule, with edits for consistency with West
Flagler, and, in response to comments, includes the phrase ``unless
that Tribe has lawfully consented'' to paragraph (c).
---------------------------------------------------------------------------

\30\ See, e.g., Pueblo of Santa Ana v. Kelly, 104 F.3d 1546,
1556 (10th Cir. 1997).
---------------------------------------------------------------------------

Sec. 293.27--What factors will the Secretary analyze to determine if
revenue sharing is lawful?
The Department has redesignated proposed Sec. 293.25 as Sec.
293.27 in the final rule. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.27, clarifying the
appropriate scope of provisions addressing revenue sharing. Congress,
through IGRA at 25 U.C.S. 2710 (d)(4), prohibited States from seeking
to impose any tax, fee, charge, or other assessment upon an Indian
Tribe or upon any other person or entity authorized by an Indian Tribe
to engage in a class III gaming activity. The proposed Sec. 293.27
codifies the Department's longstanding rebuttable presumption that any
revenue sharing provisions are a prohibited tax, fee, charge, or other
assessment. The proposed Sec. 293.27 also contains the Department's
test to rebut that presumption. The Department codifies Sec. 293.27 in
the final rule with edits to improve readability.
Sec. 293.28--May a compact or extension include provisions that limit
the duration of the compact?
The Department has redesignated proposed Sec. 293.26 as Sec.
293.28 in the final rule. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.28, addressing the
appropriate duration of a compact. The Department and IGRA anticipate
that compacts are long-term agreements between a Tribe and a State that
reflect carefully negotiated compromises between sovereigns. The
Department codifies Sec. 293.28 in the final rule.
Sec. 293.29--May any other contract outside of a compact regulate
Indian gaming?
The Department has redesignated proposed Sec. 293.28 as Sec.
293.29 in the final rule. This summary reflects the final rule section
number.
The Department proposed a new Sec. 293.29, clarifying that any
agreement between a Tribe and a State, or its political subdivisions,
which seeks to regulate a Tribe's right to conduct gaming--as limited
by IGRA--is a gaming compact that must comply with IGRA and be
submitted for review and approval by the Secretary. The Department
codifies Sec. 293.29 in the final rule with edits to improve
readability.
Sec. 293.30--What effect does this part have on pending requests,
final agency decisions already issued, and future requests?
The Department proposed a new Sec. 293.30, clarifying that the
proposed regulations are prospective and establishing the effective
date of the regulations is 30 days after this final rule is published.
The proposed Sec. 293.30(b) includes a grandfather clause, which
clarifies that the final rule does not alter prior Departmental
decisions on compacts submitted under the 2008 Regulations. The
Department codifies Sec. 293.30 in the final rule with edits to
improve certainty and clarity.
Proposed Sec. 293.31--How does the Paperwork Reduction Act affect this
part?
The Department proposed renumbering the existing Sec. 293.16 as
Sec. 293.31 to improve overall organization of the regulations. The
Department implements this change in the final rule.

VI. Procedural Requirements

A. Regulatory Planning and Review (E.O. 12866)

E.O. 12866, as reaffirmed by E.O. 13563 and E.O. 14094, provides
that the Office of Information and Regulatory Affairs (OIRA) in the
Office of Management and Budget (OMB) will review all significant
rules. OIRA determined that this rule is significant under E.O. 12866
section 3(f), but not significant under section 3(f)(1).
Executive Order 14094 reaffirms the principles of E.O. 12866 and
E.O. 13563 and states that regulatory analysis should facilitate agency
efforts to develop regulations that serve the public interest, advance
statutory objectives, and are consistent with E.O. 12866, E.O. 13563,
and the Presidential Memorandum of January 20, 2021 (Modernizing
Regulatory Review). Regulatory analysis, as practicable and
appropriate, shall recognize distributive impacts and equity, to the
extent permitted by law. E.O. 13563 emphasizes further that regulations
must be based on the best available science and that the rulemaking
process must allow for public participation and an open exchange of
ideas. The Department and BIA developed this final rule in a manner
consistent with these requirements.
Summary of Final Rule and Need for Rulemaking
The Department of the Interior (Department) is issuing revisions to
its regulations located at 25 CFR part 293, which govern the
Department's review and approval of Tribal-State gaming compacts under
IGRA. The final rule includes revisions to the Department's existing
part 293 regulations and adds provisions clarifying how the Department
reviews Tribal-State gaming compacts or compacts.
The regulations that codify the Department's review process for
Tribal-State gaming compacts are found at 25 CFR part 293 and were
promulgated in 2008 (``2008 Regulations''). 73 FR 74004 (Dec. 5, 2008).
The Department's 2008 Regulations were designed to address the process
for submission by Tribes and States and consideration by the Secretary
of Class III Tribal-State Gaming Compacts, and are not intended to
address substantive issues. 73 FR 74004-5. The Department's
consideration of substantive issues appears in decision letters,
``deemed approved'' letters, and technical assistance letters. In
addition, a body of case law has developed that addresses the
appropriate boundaries of class III gaming compacts. Negotiating
parties have been forced to review both the body of case law as well as
the Department's library of decision letters, ``deemed approved''
letters, and technical assistance letters to evaluate how the
Department views both routine and more novel issues in compacts. With
this final rule, the Department codifies longstanding Departmental
policies and interpretation of case law in the form of substantive
regulations, which will provide certainty and clarity on how the
Secretary will review certain provisions in a compact.
In addition, with this final rule, the Department makes primarily
technical amendments to the existing process-based regulations,
including the title. The technical amendments clarify and modernize the
submission and review process and contain conforming edits for internal
consistency and improved readability. Some of the key process
improvements include:
<bullet> updated definitions;
<bullet> clarifications of when ancillary agreements or documents
are amendments requiring Secretarial review under IGRA;

[[Page 13255]]

<bullet> updates to the submission process and documents required
with a submission;
<bullet> a process change requiring the Department to provide an
email acknowledging receipt of a compact and provide the date on which
the 45 day review period expires;
<bullet> a process change requiring the Department to issue a
letter to the parties if the compact or amendment has been approved by
operation of law due to the 45-day review period expiring; and
<bullet> clarification that Tribes may submit any document or
agreement to the Department for technical assistance and a
determination if the agreements or documents are amendments.
With this final rule, the Department adds 15 sections addressing
substantive issues and organizes part 293 into 4 subparts. Some of the
key longstanding Departmental policies and interpretation of case law
codified in the final rule include:
<bullet> requiring the parties to show that for any compact or
amendment that requires the Tribe to adopt standards equivalent to
State law or regulation, these mandated Tribal standards are both
directly related to and necessary for the licensing and regulation of
the gaming activity; see final rule Sec. 293.21;
<bullet> distinguishing between compact provisions that are and are
not directly related to the operation of gaming activities, based on
specific factors and providing specific examples (including a section
confirming that gaming compacts may include statewide remote wagering
or internet gaming); see final rule Sec. Sec. 293.22, 293.23, 293.24,
293.25, and 293.26;
<bullet> requiring the parties justify any revenue sharing
provisions by demonstrating that the Tribe is the primary beneficiary
of the gaming; see final rule Sec. 293.27; and
<bullet> clarifying the final rule does disrupt or alter previously
issued agency decisions; see final rule Sec. 293.30.
Anticipated Benefits
With this final rule, the Department upholds the Federal-Tribal
government to government trust relationship by codifying longstanding
Departmental policies and interpretation of case law in the form of
substantive regulations. The substantive provisions in the final rule
will provide nationwide certainty and clarity on how the Secretary will
review certain provisions in a compact. The final rule also reinforces
Congress's intent that Indian gaming continue to provide a critical
revenue source for Tribal government and reflect an exercise of Tribal
sovereignty and governance. 25 U.S.C. 2702(1). States, similarly,
exercise State sovereignty and generate State revenue through State
lotteries and tax revenue from State licensed gaming.
The Department also expects the final rule will reduce the need for
protracted litigation and dispute resolution between Tribes, States,
and third parties over permissible topics in a compact. The Department
notes the body of Departmental policy and interpretations of case law
codified in the final rule is built on numerous examples of protracted
litigation and dispute resolution. Both West Flagler and Chicken Ranch
are recent examples of this type of litigation. The final rule will
improve employee licensing by requiring compacts to be consistent with
NIGC's licensing regulations.
Anticipated Costs
The Department anticipates the final rule will have minimal costs
because the final rule codifies longstanding Departmental policies and
interpretation of case law. Tribes and States seeking to negotiate a
compact will be able to rely on the substantive provisions in the final
rule for guidance on what may or may not be included in a compact or
amendment. Section 293.26, which addresses remote wagering or internet
gaming, is consistent with existing case law. Additionally, States will
remain free to choose whether or not to permit mobile or internet
gaming in the State as well as if such gaming will be State-licensed
and taxed or compact based Tribal gaming potentially with government-
to-government revenue sharing.
The Department does expect the Office of Indian Gaming will
experience a slight increase in requests for technical assistance.
However, that increased demand will be offset by the Department's
ability to rely on the final rule to provide such guidance rather than
the existing body of case law and Department policy statements in
decision letters and other guidance letters. Additionally, this
increased demand for technical assistance will be offset by an expected
reduction in legal counsel costs for Tribes and States during
negotiations.
Alternatives Considered
The Department considered but ultimately rejected three rule making
alternatives to the final rule. The first alternative the Department
considered was to not engage in an update to the part 293 Rule,
effectively take no rule making action. The Department rejected this
alternative because it would not allow for modernization of the
Department's process and would not resolve some of the key issues which
continue to result in litigation between Tribes, States, and some third
parties. The second alternative the Department considered was to update
the existing process-based regulations, to allow for modernizations to
the Department's compact submission and acceptance process including
digital submission. This alternative would codify some of the process
improvements the Department has made including accepting email
submissions. However, this alternative would not codify any of the
Department's longstanding policy and case law interpretation resulting
in continued litigation. The third alternative the Department
considered was to update the existing process-based regulations with
some substantive provisions but excluding Sec. 293.26, which addresses
remote wagering or internet gaming. The Department notes, the rule
making effort as well as the inclusion of remote wagering or internet
gaming received overwhelming support form Tribal leaders.

B. Regulatory Flexibility Act

The Department certifies that this final rule would not have a
significant economic effect on a substantial number of small entities
under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). This final
rule codifies longstanding Departmental policies and interpretation of
case law in the form of substantive regulations, which would provide
certainty and clarity on how the Secretary will review certain
provisions in a compact.

C. Congressional Review Act (CRA)

This rule does not meet the criteria in 5 U.S.C. 804(2).
Specifically, it:
<bullet> Does not have an annual effect on the economy of $100
million or more.
<bullet> Will not cause a major increase in costs or prices for
consumers, individual industries, Federal, State, or local government
agencies, or geographic regions.
<bullet> Does not have significant adverse effects on competition,
employment, investment, productivity, innovation, or the ability of
U.S.-based enterprises to compete with foreign-based enterprises.
The Administrative Pay-As-You-Go Act of 2023 (Fiscal Responsibility
Act of 2023, Pub. L. 118-5, div. B, title II). applies to actions that
meet the definition of a rule under 5 U.S.C. 804(3). The rule does not
affect direct spending and does not have any mandatory net outlays
because there will be no additional full-time equivalent (FTE) costs or
any other additional administrative costs to

[[Page 13256]]

review Class III Tribal State Gaming Compacts. The rule clarifies case
law, Department Policy, and other related guidance over the last 30
plus years, so the review and approval of Class III Tribal Gaming
Compacts is more efficient and better streamlined.

D. Unfunded Mandates Reform Act of 1995

This rule would not impose an unfunded mandate on State, local, or
Tribal governments, or the private sector of more than $100 million per
year. The rule would not have a significant or unique effect on State,
local, or Tribal governments or the private sector. A statement
containing the information required by the Unfunded Mandates Reform Act
(2 U.S.C. 1531 et seq.) is not required.

E. Takings (E.O. 12630)

This rule would not affect a taking of private property or
otherwise have taking implications under Executive Order 12630 because
this rulemaking, if adopted, does not affect individual property rights
protected by the Fifth Amendment or involve a compensable ``taking.'' A
takings implication assessment is not required.

F. Federalism (E.O. 13132)

Under the criteria in section 1 of Executive Order 13132, this rule
would not have sufficient federalism implications to warrant the
preparation of a federalism summary impact statement. A federalism
summary impact statement is not required because the Department seeks
to codify longstanding Departmental policies and interpretation of case
law in the form of substantive regulations which would provide
certainty and clarity on how the Secretary will review certain
provisions in a compact.

G. Civil Justice Reform (E.O. 12988)

This rule complies with the requirements of Executive Order 12988.
This rule:
<bullet> Meets the criteria of section 3(a), requiring that all
regulations be reviewed to eliminate errors and ambiguity and be
written to minimize litigation; and
<bullet> Meets the criteria of section 3(b)(2), requiring that all
regulations be written in clear language and contain clear legal
standards.

H. Consultation With Indian Tribes (E.O. 13175)

The Department conducted two virtual session, one in-person
consultation, and accepted oral and written comments. The consultations
sessions were open to Tribal leadership and representatives of
federally recognized Indian Tribes and Alaska Native Corporations.
<bullet> In-Person Session: The in-person consultation was held on
January 13, 2023, from 1 p.m. to 4 p.m. MST, at the BLM National
Training Center (NTC), 9828 N 31st Ave, Phoenix, AZ 85051.
<bullet> 1st Virtual Session: The first virtual consultation
session was held on January 19, 2023, from 1 p.m. to 4 p.m. EST.
<bullet> 2nd Virtual Session: The second virtual consultation was
held on January 30, 2023, from 2 p.m. to 5 p.m. EST.
<bullet> The Department also accepted written comments until March
1, 2023.
The Department strives to strengthen its government-to-government
relationship with Indian Tribes through a commitment to consultation
with Indian Tribes and recognition of their right to self-governance
and Tribal sovereignty. The Department evaluated this rule under its
consultation policy and the criteria in E.O. 13175 and hosted extensive
consultation with federally recognized Indian Tribes in preparation of
this final rule, including through two Dear Tribal Leader letters
delivered to every federally recognized Tribe in the country. The
Department held two listening sessions and four formal consultation
sessions on the Consultation Draft. The Department has included and
addressed those comments as part of the public comment record for the
proposed rule. The Department then held three consultation sessions on
the proposed rule. The Department has included and addressed those
comments as part of the public comment record for the final rule.

I. Paperwork Reduction Act

OMB Control No. 1076-0172 currently authorizes the collection of
information related to the Class III Tribal-State Gaming Compact
Process, with an expiration of August 31, 2024. This rule does not
require a change to that approved information collection under the
Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq.

J. National Environmental Policy Act (NEPA)

This rule would not constitute a major Federal action significantly
affecting the quality of the human environment. A detailed statement
under the National Environmental Policy Act of 1969 (NEPA) is not
required because this is an administrative and procedural regulation.
(For further information see 43 CFR 46.210(i)). The Department also
determined that the rule does not involve any of the extraordinary
circumstances listed in 43 CFR 46.215 that would require further
analysis under NEPA.

K. Effects on the Energy Supply (E.O. 13211)

This rule is not a significant energy action under the definition
in Executive Order 13211. A Statement of Energy Effects is not
required.

L. Clarity of This Regulation

The Department is required by Executive Orders 12866 (section 1
(b)(12)), 12988 (section 3(b)(l)(B)), and 13563 (section l(a)), and by
the Presidential Memorandum of June 1, 1998, to write all rules in
plain language. This means that each rule we publish must:
<bullet> Be logically organized;
<bullet> Use the active voice to address readers directly;
<bullet> Use common, everyday words and clear language rather than
jargon;
<bullet> Be divided into short sections and sentences; and
<bullet> Use lists and tables wherever possible.

List of Subjects 25 CFR Part 293

Administrative practice and procedure, Gambling, Indians-Tribal
government, State and local governments.

0
For the reasons stated in the preamble, the Department of the Interior,
Bureau of Indian Affairs, revises 25 CFR part 293 to read as follows:

PART 293--CLASS III TRIBAL-STATE GAMING COMPACTS

Subpart A--General Provisions and Scope
Sec.
293.1 What is the purpose of this part?
293.2 How are key terms defined in this part?
293.3 What authority does the Secretary have to approve or
disapprove compacts and amendments?
293.4 Are compacts and amendments subject to review and approval?
293.5 Are extensions to compacts or amendments subject to review and
approval?
Subpart B--Submission of Tribal-State Gaming Compacts
293.6 Who can submit a compact or amendment?
293.7 When should the Tribe or State submit a compact or amendment
for review and approval?
293.8 What documents must be submitted with a compact or amendment?
293.9 Where should a compact or amendment or other requests under
this part be submitted for review and approval?

[[Page 13257]]

Subpart C--Secretarial Review of Tribal-State Gaming Compacts
293.10 How long will the Secretary take to review a compact or
amendment?
293.11 When will the 45-day timeline begin?
293.12 What happens if the Secretary does not act on the compact or
amendment within the 45-day review period?
293.13 Who can withdraw a compact or amendment after it has been
received by the Secretary?
293.14 When does a compact or amendment take effect?
293.15 When may the Secretary disapprove a compact or amendment?
Subpart D--Scope of Tribal-State Gaming Compacts
293.16 May a compact or amendment include provisions addressing the
application of the Tribe's or the State's criminal and civil laws
and regulations?
293.17 May a compact or amendment include provisions addressing the
allocation of criminal and civil jurisdiction between the Tribe and
the State?
293.18 May a compact or amendment include provisions addressing the
State's costs for regulating gaming activities?
293.19 May a compact or amendment include provisions addressing the
Tribe's taxation of gaming?
293.20 May a compact or amendment include provisions addressing the
resolution of disputes for breach of the compact?
293.21 May a compact or amendment include provisions addressing
standards for the operation of gaming activity and maintenance of
the gaming facility?
293.22 May a compact or amendment include provisions that are
directly related to the operation of gaming activities?
293.23 What factors will be used to determine whether provisions in
a compact or amendment are directly related to the operation of
gaming activities?
293.24 May a compact or amendment include provisions addressing
rights of employees?
293.25 May a compact or amendment include provisions addressing
employee background investigations and licensing?
293.26 May a compact or amendment include provisions addressing
statewide remote wagering or internet gaming?
293.27 What factors will the Secretary analyze to determine if
revenue sharing is lawful?
293.28 May a compact or extension include provisions that limit the
duration of the compact?
293.29 May any other contract outside of a compact regulate Indian
gaming?
293.30 What effect does this part have on pending requests, final
agency decisions already issued, and future requests?
293.31 How does the Paperwork Reduction Act affect this part?

Authority: 5 U.S.C. 301; 25 U.S.C. 2, 9, 2710.

Subpart A--General Provisions and Scope

Sec. 293.1 What is the purpose of this part?

This part contains:
(a) Procedures that Indian Tribes and States must use when
submitting Tribal-State gaming compacts and compact amendments to the
Department of the Interior (Department); and
(b) Procedures and criteria that the Secretary of the Interior
(Secretary) will use for reviewing such Tribal-State gaming compacts or
compact amendments.

Sec. 293.2 How are key terms defined in this part?

This part relies on but does not restate all defined terms set
forth in the definitional section of IGRA.
(a) Amendment means:
(1) A change to a class III Tribal-State gaming compact other than
an extension, or
(2) A change to secretarial procedures prescribed under 25 U.S.C.
2710(d)(7)(B)(vii) when such change is agreed upon by the Tribe and
State.
(b) Compact or Tribal-State Gaming Compact means an
intergovernmental agreement executed between Tribal and State
governments under IGRA that establishes between the parties the terms
and conditions for the operation and regulation of the Tribe's class
III gaming activities.
(c) Extension means an intergovernmental agreement executed between
Tribal and State governments under IGRA to change the duration of a
compact or amendment.
(d) Gaming activity or gaming activities means the conduct of class
III gaming involving the three required elements of chance,
consideration, and prize or reward.
(e) Gaming facility means the physical building or structure
situated on Indian lands where the gaming activity occurs.
(f) Gaming spaces means the areas within a gaming facility (as
defined in paragraph (e) of this section) that are directly related to
and necessary for the conduct of class III gaming such as: the casino
floor; vault; count room; surveillance, management, and information
technology areas; class III gaming device and supplies storage areas;
and other secured areas where the operation or management of class III
gaming takes place.
(g) IGRA means the Indian Gaming Regulatory Act of 1988 (Pub. L.
100-497) 102 Stat. 2467 dated October 17, 1988, (Codified at 25 U.S.C.
2701-2721 (1988)) and any amendments.
(h) Meaningful concession means:
(1) Something of value to the Tribe;
(2) Directly related to gaming activity;
(3) Something that carries out the purposes of IGRA; and
(4) Not a subject over which a State is otherwise obligated to
negotiate under IGRA.
(i) Substantial economic benefit means:
(1) A beneficial impact to the Tribe;
(2) Resulting from a meaningful concession;
(3) Made with a Tribe's economic circumstances in mind;
(4) Spans the life of the compact; and
(5) Demonstrated by an economic/market analysis or similar
documentation submitted by the Tribe or the State.
(j) Tribe means Indian Tribe as defined in 25 U.S.C. 2703(5).

Sec. 293.3 What authority does the Secretary have to approve or
disapprove compacts and amendments?

The Secretary has the authority to approve a compact or amendment
``entered into'' by a Tribe and a State under IGRA. See Sec. 293.15
for the Secretary's authority to disapprove compacts or amendments.

Sec. 293.4 Are compacts and amendments subject to review and
approval?

(a) Yes. All compacts and amendments, regardless of whether they
are substantive or technical, must be submitted for review and approval
by the Secretary.
(b) If an ancillary agreement or document:
(1) Modifies a term in a compact or an amendment, then it must be
submitted for review and approval by the Secretary.
(2) Implements or clarifies a provision within a compact or an
amendment and is not inconsistent with an approved compact or
amendment, it does not constitute a compact or an amendment and need
not be submitted for review and approval by the Secretary.
(3) Is expressly contemplated within an approved compact or
amendment, such as internal controls or a memorandum of agreement
between the Tribal and State regulators, then such agreement or
document is not subject to review and approval so long as it is not
inconsistent with the approved compact or amendment.
(4) Interprets language in a compact or an amendment concerning a
Tribe's revenue sharing to the State, its agencies, or political
subdivisions under Sec. 293.27 or includes any of the topics
identified in Sec. 293.23, then it may constitute an amendment subject
to review and approval by the Secretary.
(c) If a Tribe or a State (including its political subdivisions) is
concerned that

[[Page 13258]]

its agreement or other document may be considered a ``compact'' or
``amendment,'' either party may request in writing a determination from
the Department if their agreement or other document is a compact or
amendment and therefore must be approved and a notice published in the
Federal Register prior to the agreement or other document becoming
effective. The Department will issue a letter within 30 days of receipt
of the written request, providing notice of the Secretary's
determination. If the agreement or other document is determined to be a
compact or amendment, it must be resubmitted for Secretarial review and
approval consistent with the requirements of subpart B of this part.

Sec. 293.5 Are extensions to compacts or amendments subject to review
and approval?

No. Approval of an extension to a compact or amendment is not
required if the extension does not include any changes to any of the
other terms of the compact or amendment. However, the parties must
submit the documents required by Sec. 293.8(a) through (c). The
extension becomes effective only upon publication in the Federal
Register.

Subpart B--Submission of Tribal-State Gaming Compacts

Sec. 293.6 Who can submit a compact or amendment?

Either party (Tribe or State) to a compact or amendment can submit
the compact or amendment to the Secretary for review and approval.

Sec. 293.7 When should the Tribe or State submit a compact or
amendment for review and approval?

The Tribe or State should submit the compact or amendment after it
has been duly executed by the Tribe and the State in accordance with
applicable Tribal and State law or is otherwise binding on the parties.

Sec. 293.8 What documents must be submitted with a compact or
amendment?

Documentation submitted with a compact or amendment must include:
(a) At least one original compact or amendment executed by both the
Tribe and the State;
(b) A Tribal resolution or other document, including the date and
place of adoption and the result of any vote taken, that certifies that
the Tribe has approved the compact or amendment in accordance with
applicable Tribal law and IGRA;
(c) Certification from the Governor or other representative of the
State that they are authorized to enter into the compact or amendment
in accordance with applicable State law;
(d) Any agreement between a Tribe and a State, its agencies, or its
political subdivisions required by a compact or amendment if the
agreement:
(1) Requires the Tribe to make payments to the State, its agencies,
or its political subdivisions; or
(2) Restricts or regulates a Tribe's use and enjoyment of its
Indian lands, and any other ancillary agreements, documents,
ordinances, or laws required by the compact or amendment that the Tribe
determines are relevant to the Secretary's review; and
(e) Any other documentation requested by the Secretary that is
necessary to determine whether to approve or disapprove the compact or
amendment. If a compact includes revenue sharing, a market analysis or
similar documentation as required by Sec. 293.27.

Sec. 293.9 Where should a compact or amendment or other requests
under this part be submitted for review and approval?

Submit compacts, amendments, and all other r

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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.