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THE FACTS ABOUT TRIBAL GOVERNMENTS AND INDIAN GAMING IN

MINNESOTA

PART I: SOVEREIGNTY AND TRIBAL

GOVERNMENT

1. THE SOVEREIGNTY OF TRIBAL NATIONS

IS RECOGNIZED IN:

A. The Declaration of Independence

B. The Bill of Rights

C. The U.S. Constitution

The correct answer is C.

U.S. Constitution specifically recognizes tribes as sovereign governments, like states and foreign nations

U.S. Supreme Court has upheld this view since early 1800’s

2. The sovereignty of TRIBAL NATIONS

IS best described as a right:

A. Conferred by Congress

B. Retained under treaties with the U.S.

C. Granted by the Supreme Court

The correct answer is B.

Self-government is a retained right because:

Tribes were governing themselves, providing for their people and negotiating treaties with foreign powers, before U.S. was formed

Treaties with U.S. guaranteed right to continued self-government

3. True or False?

Tribes have the same sovereign powers and responsibilities as states.

The correct answer is True.

Tribes, like states, are obligated and empowered to:

Provide housing, education, health/welfare

Provide roads, bridges, water, sewer/sanitation

Provide law enforcement, courts, emergency services

Raise revenues through taxes and other means

Negotiate agreements with other governments

PART II. THE LEGAL BASIS FOR INDIAN

GAMING

4. Tribes can conduct gaming activities because:

A. The Supreme Court upheld their right to do so.

B. Congress authorized them to do so.

C. States authorized them to do so.

The correct answer is A.

1987 California v. Cabazon decision: tribes as sovereign governments may conduct gaming on Indian lands without regulation or interference by state, as long as gambling in some form is legal in that state

Minnesota had state lottery, parimutuel wagering and charitable gambling at the time

5. True or False?

The Indian Gaming Regulatory Act (IGRA) expanded the rights of tribes to conduct gaming on the reservation.

The correct answer is False.

IGRA actually curtailedcurtailed tribal rights by requiring that tribes negotiate compacts with states in order to conduct gaming operations

This gave states unprecedented control over tribal government activities

6. True or False?

Indian gaming is unregulated because of tribal sovereignty.


Tribal casinos are highly regulated by:

Tribal governments

U.S. Congress

U.S. Department of Interior (BIA)

National Indian Gaming Commission

State of Minnesota via compacts

7. True or False?

The State of Minnesota has virtually no regulatory authority over tribal gaming.


Under compacts, the State can:

Inspect video slots without notice and remove non-compliant machines from play

License and conduct background checks on key casino personnel

Inspect records and documents related to slot operations

More state powers...

Set payouts and technical standards for slots

Set rules of play, technical standards, staffing and video surveillance requirements for blackjack

Obtain CPA audits of gaming operations

PART III. THE ECONOMIC IMPACT OF INDIAN GAMING

8. How many jobs are represented by Indian gaming in

Minnesota?

A. 8,000

B. 12,000

C. 14,000


Tribal casinos account for a whopping 12,000 jobs12,000 jobs in Minnesota

Annual payroll of nearly $200 million

This makes tribal gaming the 9th This makes tribal gaming the 9th largest employer in Minnesota!largest employer in Minnesota!

The Top Ten Employers in Minnesota

#1-5

State of Minnesota 51,409

University of Minnesota 34,309

U.S. Government 33,665

Dayton-Hudson 28,544

3M 22,967

The Top Ten Employers in Minnesota

#6-10

Allina Health Systems 20,200

Northwest Airlines 17,000

Mayo Foundation 15,940

Tribal CasinosTribal Casinos 12,000 12,000

Hennepin County 10,490

More on Tribal Gaming Jobs...

75% are held by non-Indians, 25% by Indians

95% are full-time with full benefits

60% are rural, 40% are urban

Average wage is $16,082 ($7 per hour)

9. How much tax revenue do tribes remit to state and federal

governments?

A. $20 million annually

B. $40 million annually

C. $60 million annually


Tribes pay more than $60 million yearly:

$25+ million$25+ million in Social Security/Medicare

$19+ million$19+ million in federal withholding

$8 million$8 million in state withholding

$2 million$2 million state and federal unemployment

$6 million$6 million in state/local payments in lieu of taxes

10. How much do Minnesota tribes spend annually purchasing

goods and services from Minnesota vendors?

A. $30 million

B. $75 million

C. $100 million

D. More than $100 million

The correct answer is D.

Actual tribal gaming purchases of goods and services from Minnesota vendors:

In excess of $110 million In excess of $110 million annuallyannually

11. The Mall of American is the #1 tourist attraction in

Minnesota. Which of the following is second?

A. Valleyfair

B. Tribal Casinos

C. The Minnesota Zoo


Tribal casinos are state’s 2nd 2nd largest tourist attractionlargest tourist attraction

Tribal casinos attract 3.3 million 3.3 million out-of-state visitors each yearout-of-state visitors each year

Casino visitors spend $116 million spend $116 million annuallyannually at Minnesota lodging, dining, retail and convenience stores

More on Tribal Casinos and Tourism...

Tribal casinos spend, in aggregate, about eight times eight times as much as the state’s own as much as the state’s own Department of TourismDepartment of Tourism on tourism promotion to attract out-of-state visitors to Minnesota.

12. True or False?

Tribal gaming hurts counties because Indian tribes don’t pay property taxes.


In counties with tribal casinos:

Welfare costs have declined

Economic activity has increased

Property values have risen

Source: Arthur Anderson Study 1998, Runge Study 2005

Tribal Gaming and Scott County: An Economic Success Story

Property tax revenues up 56% since 1990, but tax rate up only 12%

Job creation up 29% since 1985 Total wages up 57% since 1985 Retail sales up 54% Employment up 52% since 1992 Market value of real property up

100% since 1986

PART IV. MEETING THE NEEDS OF TRIBAL

COMMUNITIES

13. How much of the money wagered at casinos is retained

by tribes as net income?

A. 4%

B. 15%

C. 30%

The correct answer is A.Gross Wager

100%Prize Payouts -

88%Net Gaming Revenue

12%Food/Beverage Sales

+4%Total Net Revenue

16%Operating Expense

-12%

Net IncomeNet Income 4% 4%

14. What is the largest expense for most tribal governments?

A. Government operations and infrastructure

B. General welfare of tribal members

C. Economic development programs

D. Charitable contributions


Government operations and infrastructure development account for 40 - 50% of most tribal budgets. As for the rest:

General welfare programs 25 - 35% and services (on/off res)

Economic development 10 - 20%

Charitable contributions 5 - 15%

15. True or False?

Tribal gaming only benefits Indians who live on the reservation.


Every tribe finances programs and services for off-reservation members

All tribes contribute to urban centers where Native Americans from Minnesota and elsewhere can obtain assistance

16. How many of Minnesota’s eleven tribes pay per capita

payments to members?

A. Four

B. Six

C. Seven

D. Nine


Only the 4 Sioux tribes make monthly per capita payments--fewer than 500 members each, very small reservations

Two Chippewa tribes pay small annual amounts--thousands of members, rural casinos, high demand for programs, services and infrastructure upgrades

More on Per Capita Payments...

Under federal law, per capita payments:

Must be approved by federal government before distribution to tribal members

Can only be paid after community needs are met

Are taxable income to tribal members

17. What is the largest unmet need still facing Minnesota

reservations?

A. Education

B. Housing

C. Health Services

D. Public Works and Safety

E. Capital Debt Retirement

The correct answer is B. #1 Housing $120,000,000

#2 Debt Retirement 100,000,000

#3 Education 96,000,000

#4 Govt Operations 76,000,000

#5 Health Services 70,000,000

#6 Public Works 34,000,000

TOTAL UNMET NEEDS: $500,000,000

PART V. INDIANS, TAXES AND LAND

18. do INDIANS PAY FEDERAL TAXES?

A. Indians are exempt from federal income taxes.

B. Indians pay some federal taxes, but at lower rates than others.

C. Indians pay the same federal taxes everyone else pays.


Indians pay federal income taxes just like everyone else on all income, including per capita payments from gaming.

19. True or False?

Indians are exempt from state income taxes.


The vast majority of Indians pay state income tax like everyone else.

Only exceptions: Those who live and work on the reservation--(fewer than 20% of all Indians in Minnesota)

20. True or False?

Indians are exempt from county property taxes.


60% of Minnesota Indians live off-reservation, and pay county property taxes like everyone else

Reservation Indians living on fee land pay county property taxes like everyone else

Only exception: those who live on federal trust land within reservation boundaries

21. True or False?

Indians are exempt from excise and sales taxes.

The correct answer is False. Indians pay all federal excise taxes.

Indians pay all state sales taxes under voluntary agreements between tribes and the State of Minnesota

Without voluntary agreements, the State has no authority or mechanism for collecting state taxes on the reservation

22. What share of tax-exempt lands in Minnesota belongs to

tribes?

A. Less than 1%

B. 5%

C. 10%

D. 20%


Tribes hold less than six-tenths of 1% of all public lands in Minnesota by market value

Other large tax-exempt land holders:

• U.S. government• State of Minnesota• County governments• School districts• Churches

23. True or False?

Allowing tribes to purchase land and put it into trust for government purposes harms counties by denying them the tax revenue those lands might have generated.


Counties gain far more than they lose when tribes use trust land to operate casinos or other successful businesses, especially in rural areas

This fact explains why most cities and counties offer tax-relief or tax-funded incentives to stimulate new business and job creation

24. Which of the following did notnot benefit from taxpayer-funded public investment or

incentives?

A. The Mall of America

B. Polaris, Inc.

C. Northwest Airlines

D. Tribal casinos

The correct answer is D.

Tribal casinos were developed without a nickel of state investment…

That means the 14,000 jobs That means the 14,000 jobs created in tribal gaming didn’t created in tribal gaming didn’t

cost taxpayers a dime!cost taxpayers a dime!

That’s it…how did you do?

Give yourself 1 point for each correct answer:

21-24 correct...You’re a whiz!

17-20 correct... Not bad but keep at it

14-16 correct... You’re on shaky ground

Less than 14 correct… would you like a copy of this presentation for future

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BET YOU DIDN''T KNOW