Opinion: What Proposed Federal Rule Changes Could Mean For Casino Expansion In Florida

Written By John Holden on March 20, 2023
New tribal rules won't affect Florida gaming market

Miami Beach Mayor Dan Gelber wrote a letter to the Department of the Interior at the beginning of the month.

Gelber was arguing against rule changes the DOI’s Bureau of Indian Affairs released in December 2022. According to Gelber, these rules would expand Florida casinos into areas where they otherwise wouldn’t be.

In Gelber’s words, these rule changes “Can and will facilitate and hasten the introduction of off-reservation Indian gaming casinos.”

Gelber previously spoke out against gaming expansion in the Sunshine State. That includes sending a previous letter to the DOI, urging the department to reject the 2021 Florida gaming compact.

The mayor’s concerns stem from the rule changes, which amongst many other things, would allow tribes to purchase property off-reservation and transfer it into a trust much easier than they could previously.

These proposed rule changes look to be an effort to modernize the Indian Gaming Regulatory Act. Congress passed the law in 1988 when gaming appeared much different than it does today.

However, anti-gambling activists like Gelber believe these changes could spark a massive change to the status quo.

But that doesn’t seem likely.

What is the federal government proposing?

Last December, the Bureau of Indian Affairs proposed a number of changes to regulations impacting U.S. tribes.

One of the proposals was a modernization of Class III gaming compacts that would effectively end the debate over whether tribes can offer online betting through the compacting process.

The federal government could provide immense clarity to a central issue in Florida with the change. The D.C. Court of Appeals is currently deciding whether the Florida gaming compact that allowed the Seminole Tribe to offer online sports betting throughout the state violated IGRA.

However, the second proposal involves changes to the fee-to-trust process. In this process, one entity transfers the land title to the federal government.

The feds hold that land “for the benefit of an individual or tribe.” The process has been in place in one fashion or another for more than a century. Congress enacted these rules long before IGRA and encompassed far broader-ranging issues than just gaming, though current regulations were established in 1980.

Much of the focus has been on how this might impact tribal land acquisition to operate casinos. But the proposed changes can potentially expedite the process for tribes to acquire and gain jurisdiction over land.

What does fee to trust mean?

The fee-to-trust process is when a land title is transferred to the federal government to benefit a recognized tribe. The current process is 16 steps and can take years to complete.

Why the opposition?

Some fear the proposed changes to the fee-to-trust regulations will result in a massive influx of land for gaming purposes. Therefore, they believe this expands the gaming market by default.

Much of the focus in Florida stems from the recent acquisition attempt of Magic City Casino by the Poarch Band of Creek Indians. The tribe is based in Alabama but is trying to purchase its third Florida gambling establishment.

Miami Beach’s mayor has been a staunch opponent of gaming expansion for some time. But it’s unclear whether his fears of these changes are warranted. The regimented approval infrastructure for gaming expansion and the compacting process remain in place without other proposed changes.

The proposed changes represent, effectively, a change to modernize a process that predates the availability of household internet.

What does this mean?

The steps proposed by the Bureau of Indian Affairs and the Department of the Interior would be a significant step forward. Government bureaucracy bogs down the current fee-in-trust process.

The modernization of the compacting process is necessary to allow tribes to be competitive against commercial counterparts.

The future of the modern gaming market is online. Commercial gaming companies are making plenty of headway in online gambling markets. The purpose of IGRA is threatened if tribes are limited to brick-and-mortar products on tribal land.

Congress wrote IGRA to support tribes in raising tribal government revenue, clarifying regulations, ameliorating jurisdictional disputes and promoting “tribal economic development, tribal self-sufficiency and strong tribal government.”

To achieve these goals, the government needs to update IGRA. With the other options on the market, tribes need to be more competitive.

This comes in two forms, first, by allowing tribes to acquire land in trust to operate businesses and provide government services in places of need. Second, by not creating unnecessary restrictions, the commercial side of the industry doesn’t have to face.

IGRA and the fee-in-trust program both require modernization. But opponents will challenge them in court if the changes are adopted.

The big question appears to be not whether IGRA is necessary. It is. But whether the administrative agency can undertake this change themselves or if Congress needs to do it.

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John Holden

John Holden is an Ottawa native raised in Oakville. Holding a J.D. / Ph.D., Holden is an academic at heart. For PlayFL, Holden will focus mostly on the legal developments in the current battle over Florida sports betting.

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