Class III Gaming Procedures

DEPARTMENT OF THE INTERIOR

Bureau of Indian Affairs

25 CFR Part 291

RIN 1076-AD87

Class III Gaming Procedures

AGENCY: Bureau of Indian Affairs, Interior.

[[Page 17536]]

ACTION: Final rule.

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SUMMARY: The Department is issuing regulations prescribing procedures

to permit Class III gaming when a State interposes its immunity from

suit by an Indian tribe in which the tribe accuses the state of failing

to negotiate in good faith. The rule announces the Department's

determination that the Secretary may promulgate Class III gaming

procedures under certain specified circumstances. It also sets forth

the process and standards pursuant to which any procedures would be

adopted.

EFFECTIVE DATE: These regulations take effect on May 12, 1999.

FOR FURTHER INFORMATION CONTACT: Paula Hart, Indian Gaming Management

Staff, Bureau of Indian Affairs, Department of the Interior, MS 2070-

MIB, 1849 C Street NW, Washington, DC 20240, Telephone (202) 219-4066.

SUPPLEMENTARY INFORMATION: Congress enacted the Indian Gaming

Regulatory Act (IGRA), 25 U.S.C. 2701-2721, to provide a statutory

basis for the operation and regulation of Indian gaming and to protect

Indian gaming as a means of generating revenue for tribal governments.

Prior to the enactment of IGRA, states generally were precluded from

any regulation of gaming on Indian reservations. See California v.

Cabazon Band of Mission Indians, 480 U.S. 202 (1987). The IGRA, by

offering States an opportunity to participate with Indian tribes in

developing regulations for Indian gaming, ``extends to the States a

power withheld from them by the Constitution.'' Seminole Tribe of

Florida v. State of Florida, 517 U.S. 44, 58 (1996).

Since IGRA's passage in 1988, more than 200 compacts in 24 States

have been successfully negotiated by tribes and States, and approved by

the Secretary. Today, Indian gaming generates significant revenue for

Indian tribes. As required by IGRA, gaming revenues are being devoted

primarily to providing essential government services such as roads,

schools, and hospitals, as well as economic development.

The IGRA divides Indian gaming into three categories. This rule

addresses only the conduct of Class III gaming, which primarily

includes slot machines, casino games, banking card games, dog racing,

horse racing, and lotteries. 25 U.S.C. 2703(8); 25 CFR 502.4. Under

IGRA, the conduct of ``Class III gaming activities'' is lawful on

Indian lands only if such activities: (1) Are authorized by an

ordinance adopted by the governing body of the tribe and approved by

the Chairman of the National Indian Gaming Commission (NIGC), (2) are

located in a State that permits such gaming for any purpose by any

person, organization, or entity, and (3) are conducted in conformance

with a Tribal-State compact. 25 U.S.C. 2710(d)(1)(B). The regulations

that follow relate primarily to this third requirement, i.e., the

Tribal-State compact.

Under IGRA, a tribe interested in operating Class III gaming

initiates the compacting process by requesting the State to enter into

negotiations to develop the Tribal-State compact. 25 U.S.C.

2710(d)(3)(A). Upon receiving such a request, the State is obliged ``to

negotiate with the Indian tribe in good faith to enter into such a

compact.'' Id. If the State fails to negotiate in good faith, the tribe

may initiate an action against the State in Federal district court. 25

U.S.C. 2710(d)(7)(A)(i). If the court finds that the State has failed

to negotiate in good faith, it must order the State and the tribe to

conclude a compact within 60 days. 25 U.S.C. 2710(d)(7)(B)(iii). If the

State and tribe fail to conclude a compact within that period, each

side must submit their last best offer to a court-appointed mediator,

who selects one of the proposals. 25 U.S.C. 2710(d)(7)(B)(iv). If the

State consents to the mediator's proposal it is treated as a Tribal-

State compact. 25 U.S.C. 2710(d)(7)(B)(vi). If the State does not

consent, the Secretary of the Interior (Secretary) shall prescribe

procedures (1) which are consistent with the proposed compact selected

by the mediator, the provisions of IGRA, and the relevant provisions of

State laws, and (2) under which Class III gaming may be conducted on

the Indian lands over which the Indian tribe has jurisdiction. 25

U.S.C. 2710(d)(7)(B)(vii).

In Seminole Tribe of Florida v. Florida, the Supreme Court held

that a State may assert an Eleventh Amendment immunity defense to avoid

a lawsuit brought by a tribe alleging that the State did not negotiate

in good faith. After the Seminole decision, some States have signaled

their intention to assert immunity to any suit in Federal court.

Claiming immunity will, if no further action is taken, create an

effective State veto over IGRA's dispute resolution system and

therefore will stalemate the compacting process. This rule contemplates

that the Secretary may prescribe Class III gaming procedures to end the

stalemate.

On May 10, 1996, the Bureau of Indian Affairs (BIA) published an

Advance Notice of Proposed Rulemaking (ANPR) in response to the United

States Supreme Court's decision in Seminole Tribe of Florida v.

Florida. 61 FR 21394 (May 10, 1996). In that ANPR, the Department

posed, among others, the question of ``[w]hether and under what

circumstances, the Secretary is empowered to prescribe `procedures' for

the conduct of Class III gaming when a State interposes an Eleventh

Amendment defense to an action pursuant to 25 U.S.C. 2710(d)(7)(B).''

The Secretary, in consultation with the Solicitor, has determined that

he possesses legal authority to promulgate procedures setting out the

terms under which Class III gaming may take place when a State asserts

its immunity from suit. The Secretary's authority arises from the

statutory delegation of powers contained in 25 U.S.C.

2710(d)(7)(B)(vii) of IGRA and 25 U.S.C. 2 and 9.

Summary of the Rule

The rule tracks IGRA's negotiation and mediation process, adjusted

only to the extent necessary to reflect the unavailability of tribal

access to Federal court where a State refuses to waive sovereign

immunity. The rule applies only where a tribe asserts that a State is

not negotiating in good faith, files suit against the State in Federal

court in accordance with IGRA, but cannot proceed in Federal court

because the State refuses to waive its sovereign immunity from suit. In

cases in which a State chooses not to assert a sovereign immunity

defense, the rule will not apply. Instead, the negotiation and

mediation process set forth in section 2710(d)(7) of IGRA would

continue under the supervision of the court.

In those cases in which a State interposes a sovereign immunity

defense to a tribal lawsuit in Federal court, the regulation

establishes a process for obtaining State participation in the

compacting process, prior to the Secretary's identification of

procedures.

The steps set forth in the rule include:

1. Following dismissal on grounds of sovereign immunity of a

tribe's suit brought pursuant to 25 U.S.C. 2710(d)(7) against a

State, the tribe will have the opportunity to submit a request to

the Department to establish gaming procedures. The procedures

submitted by the tribe will be required to address all of the issues

identified in the rule, including the scope of the gaming activities

being requested by the tribe and detailed mechanisms for regulation

of the gaming, including assurances that games will be conducted

fairly and that the financial integrity of the entire operation will

be safeguarded. The tribe will be asked to provide a legal analysis

supporting the proposed scope of gaming in view of State

prohibitions and other policies on specific types of gaming.

2. The Department will notify the tribe within 15 days that it

has received the proposal and whether it is complete. Within

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30 days the Department will notify the tribe whether it is eligible

for procedures.

3. Following issuance of a notice of completeness and

eligibility, the Department will notify the State of the tribe's

request for the issuance of procedures, and solicit the State's

comments on the tribe's proposed procedures, including any comments

on the proposed scope of gaming. The State will also be invited to

submit alternative proposed procedures within 60 days.

4. Based on its review of the submissions of the tribe and the

State, and if the State has not submitted an alternative proposal,

the Department will advise the State and Indian tribe of: (a) its

approval of the tribe's proposal if the Secretary determines that

there are no objections to the proposals; (b) its convening of an

informal conference with the State and tribe within 30 days for the

purpose of resolving any areas of disagreement.

5. If the State offers an alternative proposal, the Secretary

will appoint a mediator who will receive ``last best offers'' from

the State and tribe. The mediator must then submit to the Secretary

the proposed procedures that best comport with applicable Federal

and State law. Within 60 days of receipt of the mediator's

recommendation, the Secretary must notify the State and tribe of his

decision to approve or disapprove the procedures submitted by the

mediator, or prescribe such procedures as he determines appropriate

that are consistent with State law and the provisions of IGRA.

Review of Public Comments

Sixty-seven (67) comments were submitted in response to the January

22, 1998, Federal Register publication of the proposed rule, 25 CFR

291.

Section 291.1 Purpose and Scope

Nearly all of the comments from the States reiterated or expanded

on comments previously submitted arguing that the Secretary lacks legal

authority to promulgate these regulations. Comments from the Indian

tribes likewise reiterated prior comments in support of the Secretary's

authority to adopt the proposed regulation.

Response: The Department adheres to the reasoning set forth in the

January 22, 1998 Federal Register publication in support of the

Secretary's authority to adopt the proposed regulation. In addition, a

recent case, Spokane Tribe of Indians v. Washington State, 139 F.3d

1297 (9th Cir. 1998)(Spokane II), casts doubt on the legal authority

relied upon by the States in their comments to the proposed rule. In

Spokane II, the court noted that an earlier opinion (Spokane Tribe of

Indians v. Washington State, 28 F.3d 991 9th Cir. 1994)(Spokane I))

questioned the Eleventh Circuit court of appeals' statement in Seminole

Tribe of Florida v. Florida, 11 F.3d 1016 (1994) supporting the

approach subsequently taken in our proposed rule. The Spokane II court

noted that the statement in Spokane I:

was in the context of our (incorrect) assumption that tribes could

sue states. We were pointing out that the Eleventh Circuit's

suggestion would not be as close to the Congress' intent as the

scheme Congress in fact passed. True. But the Supreme Court has now

told us that Congress' scheme is unconstitutional; the Eleventh

Circuit's suggestion is a lot closer to Congress' intent than

mechanically enforcing IGRA against tribes even when states refuse

to negotiate. 139 F.3d at 1301-02.

As an adjunct to the argument that the Secretary lacks authority,

the States assert that the Secretary's authority under the statute is

limited to circumstances where a court has made a finding that a State

has failed to negotiate in ``good faith'' with an Indian tribe over

Class III gaming procedures. The State strenuously objects to any role

for the Secretary in evaluating whether a State has negotiated in

``good faith.'' Their objection is based on alleged bias that the

Secretary might have due to the trust responsibility owed by the

Federal government to the Indian tribes. The States also assert that

the Secretary lacks expertise to make such a finding. The final

regulation eliminates the requirement that the Secretary make a finding

on the ``good faith'' issue. States will be invited to participate in

mediation if they wish. They can also submit comments on the proposed

scope of gaming (the issue most often contested in negotiations) and on

any other matter pertaining to an Indian tribe's proposed procedures.

The Secretary will take those views into account in his decision-making

process. Congress' intent was to ensure a role for the States in

developing the terms and conditions under which Class III Indian gaming

would take place. The approach taken in the regulation is consistent

with that intent.

Several comments suggested that the rule be expanded to explicitly

include compact renewals.

Response: This recommendation was adopted because the authority

granted the Secretary in IGRA to issue Class III gaming procedures

speaks only in terms of entire compacts, and a renewal of an entire

compact falls within this authority. Section 291.2(b) was added in the

definition section to make clear the term ``compact'' as used in the

regulations includes compact renewals.

Several comments suggested the scope be expanded to include compact

amendments.

Response: This recommendation was not adopted because the authority

granted to the Secretary in IGRA to issue Class III gaming procedures

speaks only in terms of entire compacts, not to amendments.

One comment suggested the scope was too narrow because it limits

the application to when the tribe has brought an action in Federal

court and the State has asserted its immunity from such suit, and the

court has dismissed the action.

One comment suggested that if the State issues a letter of intent

to raise its immunity defense, then this should suffice to trigger the

Class III gaming procedures.

Response: These recommendations were not adopted because the

statutory trigger in IGRA for the Secretary to issue Class III gaming

procedures is the filing of a lawsuit.

One comment suggested the proposed scope would clog the courts in

futile litigation and stonewall the IGRA process for several years. The

comment suggested it should be sufficient for the State to assert its

immunity in just one tribe's lawsuit.

Response: This recommendation was not adopted because the statutory

trigger in IGRA for the Secretary to issue Class III gaming procedures

is the filing of a lawsuit because of the particular parties' failure

to conclude a compact. The regulation cannot dispense with the

requirement that each tribe be involved in a lawsuit. The regulation

must be the same for each tribe.

Section 291.2 Definitions

Paragraph (b) was added to make clear the regulations apply to

compact renewals as suggested by several comments. See Summary of

Comments under section 291.1.

Section 291.3 When May an Indian Tribe Ask the Secretary To Issue

Class III Gaming Procedures?

One comment recommended that paragraph (b) be revised to state that

if the tribe and State failed to negotiate a compact 180 days after the

State received the tribe's request, or if the State previously asserted

its Eleventh Amendment immunity in an action brought by any tribe, or

if the State unequivocally refused to enter into or continue

negotiations.

Response: This recommendation was not adopted because the

regulation tracks the statutory requirements in 25 U.S.C. 2710(d)(7)(A)

and (B).

One comment suggested that section (c) be reworded.

Response: This recommendation was not adopted because the words

track the statutory language in 25 U.S.C. 2710(d)(7)(A)(i) and

(B)(ii)(II).

One comment suggested broadening paragraph (d) to included any

tribal action in which the State declined to waive its immunity.

[[Page 17538]]

Response: This recommendation was not adopted for the same reason

expressed for one comment under Sec. 291.1, which is that the statute

requires the particular parties to be unable to conclude a compact and

a lawsuit is initiated as a result. The regulation must have the same

criteria for each tribe.

Several comments suggested broadening paragraph (d) to include the

State's assertion of any immunity, whether it be the Eleventh

Amendment, Tenth Amendment, or otherwise.

Response: These recommendations were not adopted because the

regulation explicitly deals with Eleventh Amendment immunity, and not

with other potential barriers.

One comment recommended that paragraph (d) require the State to

either choose the court process or the Secretarial process out of

concern that the Eleventh Amendment immunity defense could be raised

late in the appeal process.

Response: This recommendation was not adopted because the

regulation explicitly deals with the Secretarial process once the State

successfully asserts its Eleventh Amendment immunity.

Several comments suggested that instead of requiring an actual

assertion of the State's immunity, the regulation should only require

documentation of the State's intention to assert such immunity.

Response: This recommendation was not adopted because the statutory

trigger for the Class III gaming procedures is an initiation of a

lawsuit. The scope of the regulations provides for procedures where the

State actually raised its Eleventh Amendment immunity and the case was

dismissed as a result.

Numerous comments suggested deleting paragraph (e) because the

requirement that the action be dismissed for each tribe is burdensome,

wasteful and time consuming.

One comment suggested that the requirement that each action be

dismissed could place tribal attorneys in an awkward position under

Rule 11 of the Federal Rules of Civil Procedure.

Several comments recommended that in place of requiring a dismissal

for each lawsuit, require clear proof of the State's intention to raise

its Eleventh Amendment immunity.

Response: These recommendations were not adopted because the

Secretary's authority under IGRA for Class III gaming procedures is

only triggered by a lawsuit and the regulatory trigger must be the same

for each tribe.

The words ``because of lack of jurisdiction'' were deleted from

paragraph (e) to clarify that the scope of the regulations is limited

to when the State actually raises its Eleventh Amendment immunity and

the case was dismissed on that ground. One comment agreed that the

scope of section 291.3 is consistent with the suggestions made by the

11th Circuit in the Seminole decision.

Section 291.4 What Must the Proposal Requesting Class III Gaming

Procedures Contain?

One comment suggested adding the words ``if any'' at the end of

paragraph (c) because a tribe's gaming ordinance or resolution need not

be approved by the NIGC prior to the negotiation and completion of a

gaming compact.

Response: This recommendation was adopted because approval of the

tribe's ordinance or resolution by the NIGC is not required before

Class III gaming procedures are approved, but the ordinance or

resolution must be approved by the NIGC before gaming is conducted.

Two comments suggested adding the words ``if any'' at the end of

paragraph (d) because not all tribes have organic documents.

Response: These recommendations were adopted.

A few comments suggested clarifying paragraph (g) because a ``copy

of court proceedings'' is ambiguous and provides no useful guidance on

what exact documents need to be submitted.

Response: These recommendations were adopted, and paragraph (g) was

amended to include a list of specific documents in language suggested

by one of the comments.

One comment suggested revising paragraph (h) to enumerate specific

examples of factual and legal authority for the scope of gaming.

Response: This recommendation was not adopted because the

regulations leave it up to a tribe's discretion what it wishes to

submit for the factual and legal authority.

One comment stated paragraph (i) was ambiguous, unnecessary and

onerous because the regulation appeared to expand the NIGC's existing

monitoring and enforcement authority.

Another comment suggested paragraph (i) be revised to include only

a regulatory scheme for a federal agency role. One comment stated the

NIGC is the proper monitoring and enforcement agency and other

designation was unnecessary.

Another comment suggested the BIA is precluded from compelling a

State to participate in monitoring and enforcement in the absence of a

voluntary agreement.

Response: To accommodate the concerns raised by the comments, the

term ``federal'' was deleted from paragraph (i) to make clear that if

the tribe envisions the State to have a role in monitoring and

enforcement by mutual and voluntary agreement, the tribe must submit

this regulatory scheme to the Secretary in its Class III gaming

procedures proposal. In addition, a new section 291.12 is added to the

regulations to clarify the NIGC's monitoring and enforcement roles.

One comment suggested it was unreasonable for tribes to have to

submit an accounting system under paragraph (j)(1). The comment

recommended having the tribes submit a certification that it will

operate its accounting system in accordance with the specified

standards, principals and NIGC regulations.

One comment suggested the provision was perplexing because a tribe

should not have to submit applicable NIGC regulations. The drafters did

not intend either of these interpretations.

Response: Both recommendations were adopted, and the language and

punctuation in paragraph (j)(1) was changed for clarification.

One comment recommended referencing the NIGC regulations for

internal control standards in paragraph (j)(4).

Response: This recommendation was adopted.

Several comments suggested that the requirements under paragraph

(j)(8) were beyond the statutory requirements, beyond NIGC regulatory

requirements, and created low thresholds.

Response: These recommendations have been adopted, and paragraph

(j)(8) has been amended to be more consistent with 25 U.S.C.

2710(b)(2)(D) and NIGC regulations.

A few comments suggested the Secretary will be inundated with

background information documents, licensing documents and the like;

but, the regulation only requires submission of rules governing these

issues.

One comment recommended deleting the words ``all gaming activities

. . . count rooms'' in paragraph (j)(10) as being duplicative because

they were already covered under (j)(4).

Response: This recommendation was adopted.

Several comments addressed the need for flexibility in how tribes

handle disputes under paragraph (j)(11).

One comment recommended adding the words ``and/or tribal judicial

process'' in addition to the administrative process in paragraph

(j)(11) to accommodate different tribal processes.

[[Page 17539]]

Response: This recommendation was adopted.

One comment under paragraph (j)(11) recommended adding a provision

for tribes acquiring insurance and a waiver of tribal sovereign

immunity thereunder.

Response: This recommendation was not adopted because it is beyond

the scope of these regulations.

One comment under paragraph (j)(15) suggested adding language in

case a tribe chooses not to serve liquor at the gaming facility.

Response: This recommendation was adopted. For clarification,

reference to the statutory definition of liquor under a Secretarially

approved ordinance/resolution was incorporated.

Several comments recommended deleting the word autonomous from

paragraph (j)(16) as being confusing because tribal gaming commissions

are to some degree subject to the jurisdiction of the Tribal Council or

other tribal governing body, and the Secretary should not be making

that determination.

Response: This recommendation was adopted and the language deleted

for clarification.

Several comments suggested changing the word ``commission'' to

accommodate the variety of tribal regulatory structures, such as

departments, individuals, and offices.

Response: These recommendations were adopted and the word was

changed to ``entity.''

One comment suggested paragraph (j)(17) is vague and recommended

providing reasonable standards that dictate when a tribe must provide

administrative appeal rights, including what facts trigger the process,

what due process rights attach and remedies available.

Response: This recommendation was not adopted because the

regulations should not impose particular administrative appeal

processes on the tribes. The regulations provide for such an appeal

process while accommodating tribal flexibility of its own

administration.

One comment suggested paragraph (j)(17) was partially unnecessary

because the NIGC already had enforcement and investigatory mechanisms.

Response: To clarify the intent of paragraph (j)(17), the word

``tribal'' was added to make clear this provision relates to tribal

enforcement and investigatory mechanisms, not Federal or State.

Paragraph (j)(18) was added in response to a comment on the duration of

the Class III gaming procedures. See Summary of Comments under section

291.15.

Section 291.5 Where must the proposal requesting Class III gaming

procedures be filed?

No comments were received on this section.

Section 291.6 What must the Secretary do upon receiving the proposal?

Several comments suggested changing the time frames in sections

291.3, 4 and 6 to be the same.

Response: In response to this comment, language has been added to

make clear that the review in paragraph (a) is not substantive, but

instead a limited review as to whether all the information required

under section 291.4 is present in the application. The review in

paragraph (b) is substantive and as such requires a longer period of

time than the review in paragraph (a). A 60-day time frame is

reasonable and necessary to make the substantive determination.

Section 291.7 What must the Secretary do if it has been determined that

the Indian tribe is eligible to request Class III gaming procedures?

Numerous comments recommended deleting the requirement that the

State be notified once the Secretary determines the tribe is eligible

for Class III gaming procedures.

One comment suggested it was beyond the Secretary's authority

because IGRA explicitly provides for consultation with the tribe, but

does not require consultation with the State.

Many commentors suggested that the State should not be involved in

the Class III gaming procedures process because they believe it would

give the State another opportunity to stonewall, delay or subvert the

IGRA process after it already asserted its Eleventh Amendment immunity

in the lawsuit.

Response: These recommendations were not adopted because IGRA does

not prohibit the consultation of the States. Further, the regulations

attempt to track the IGRA process in which the participation of all

parties is contemplated.

Several comments supported section 291.7 as written to ensure and

encourage State involvement in the process and to maintain fairness in

the process as contemplated by IGRA.

One comment suggested that the Governor and Attorney General may

not be the proper authorities in the particular State with whom to

consult, and that the Governor and Attorney General may have opposing

views.

Response: This recommendation was not adopted because the Attorney

General is invited to participate in the procedures since he/she

represented the State in the lawsuit which was dismissed due to the

Eleventh Amendment immunity. It is anticipated that in situations where

the Governor is not the proper official, the Governor may notify the

Secretary if actual authority has been delegated and/or rests with

another State official, department, commission, or other entity.

Several comments suggested that the 60 days in paragraph (b) is too

long.

One comment recommended that absent good cause shown, the State

should be allowed no more than 30 days.

Response: These recommendations were not adopted because 60 days

allows time for the State to conduct a thorough and substantive review

of the tribe's proposal.

Numerous comments were received on paragraph (b)(2) from both the

states and tribes.

One comment suggested that by transferring to the Secretary the

authority to determine a State's good faith, the tribes have no

incentive to negotiate in good faith and will often proceed directly to

the Class III gaming procedures.

Many comments suggested deleting this paragraph because the

Secretary has no authority to pass judgment in a quasi-judicial

determination upon the State's conduct.

Some comments suggested that the Secretary would not be able to

make such a determination in the absence of cross-examining witnesses

and judging credibility.

Some comments suggested a good faith determination by the Secretary

will destroy the neutrality of the Class III gaming procedures.

One comment suggested the paragraph be deleted because the

Secretary would be making a judicial determination without any of the

safeguards of a judicial proceeding, contrary to the IGRA scheme.

Response: These recommendations have been adopted and paragraph

(b)(2) has been deleted.

One comment noted that the regulations were ambiguous, and appeared

to grant the Secretary authority to proceed with the Class III gaming

procedures irrespective of the good faith determination outcome.

The comment suggested that the good faith determination be made at

the outset in order to proceed with the procedures process.

[[Page 17540]]

One comment suggested the paragraph provided no standard for the

Secretary to follow in making a good faith determination, and suggested

placing the burden on the State to prove good faith.

Response: These recommendations were not adopted because the good

faith determination has been deleted from the regulations.

One comment suggested deleting paragraph (b)(3) because State law

does not apply to activities conducted on Indian lands except regarding

the scope of gaming.

This recommendation was not adopted because the language in

paragraph (b)(3) tracks the requirement and language in IGRA, section

2710 (d)(7)(B)(vii)(I).

One comment suggested revising paragraph (c) to require the State

to address all the issues listed in section 291.4 when it submits an

alternate proposal.

Response: This recommendation was not adopted because 291.4 is

applicable only to the tribal applicant.

One comment suggested deleting paragraph (c) because the State

should not be allowed to submit a proposal if the Secretary determines

the State did not negotiate in good faith.

Response: This recommendation was not adopted because the good

faith determination has been deleted from the regulations.

Section 291.8 What must the Secretary do at the expiration of the 60-

day comment period if the State has not submitted an alternative

proposal?

One comment suggested deleting the 60-day reference to the comment

period in section 291.7.

Response: This recommendation was not adopted in order to retain

clarity.

Several comments objected to the discussion of the ``scope of

gaming'' as being either too broad, or too narrow.

Response: These recommendations were not adopted, because the

applicable scope of gaming must be determined on a case-by-case basis.

The summary of the law and the United States' position as set forth in

the proposed rule remains the standard for analyzing the scope of

gaming issue. 63 FR 3289, 3292-3293 (January 22, 1998).

Several comments suggested deleting paragraph (a)(4) as being

troubling, unnecessary and inappropriate.

Response: These recommendations have not been adopted because this

paragraph is consistent with the requirement as set forth in IGRA,

section 2710(b)(7)(B)(vii)(I).

Numerous comments were received from both States and tribes under

paragraph (a)(8) similar to those received under section 291.7(b)(2).

Several comments suggested eliminating this paragraph as being

beyond the authority of the Secretary, unnecessary, unclear and

irrelevant.

Several comments suggested the Secretary could not impartially and

properly adjudicate the issue because of the trust responsibility to

tribes, a conflict of interest, and a lack of knowledge concerning the

intricacies of the negotiation between the State and tribe.

Response: These recommendations were adopted and paragraph (a)(8)

has been deleted.

One comment suggested that the Secretary publish his/her

determination on the good faith issue.

Response: This recommendation was not adopted because the good

faith determination has been deleted from the regulations.

One comment suggested paragraph (a)(8) appeared to be a drafting

error.

Response: This comment's concern is alleviated because the

paragraph has been deleted.

One comment suggested the paragraph be revised to include specific

examples of State action which would be considered as evidence of bad

faith.

Response: This recommendation was not adopted because the good

faith determination has been deleted from the regulations.

Several comments suggested changing the 60-day time frame in

paragraph (b) because it was too long or unnecessary if a State does

not submit an alternate proposal.

Response: These recommendations were not adopted because the 60-day

time frame is reasonable for a substantive review if the State submits

comments under section 291.7(b). If the State does not submit comments,

the Secretary may not need the entire 60 days.

One comment suggested deleting the requirement that the Secretary

notify the State.

Response: This recommendation was not adopted because the State is

an involved party in the Class III gaming procedures process as

contemplated by IGRA. Paragraph (b)(2) was deleted as unnecessary. If

the Secretary determines that the State's alternative proposal contains

no objections to the tribe's proposal, the proposal is approved. If the

Secretary determines there are unresolved issues and areas of

disagreement between the State's alternative proposal and the tribal

proposal, then the parties will be invited to participate in an

informal conference.

One comment suggested paragraph (b)(3) is confusing because if the

State does not submit an alternative proposal, then how can the

Secretary make a determination of unresolved issues and areas of

disagreement.

Response: This recommendation was not adopted because the State can

comment on the tribe's proposal under section 291.7(b) without

necessarily submitting an alternative proposal. Further, if the

Secretary makes a determination that there are no objections to the

tribe's proposal, he/she can approve the proposal.

One comment suggested it was inappropriate under paragraph (b)(3)

to invite the State to participate in an informal conference because

the unresolved issues and areas of disagreement may be exclusively

tribal.

Response: This recommendation was not adopted because the

unresolved issues and areas of disagreement are between the parties.

One comment suggested revising paragraph (b)(3) to include a time

frame in which the informal conference would be held.

Response: This recommendation was adopted and language was added to

state that the parties will be invited to participate in an informal

conference within 30 days of receiving the Secretary's notice.

Several comments suggested the 30-day time frame in paragraph (c)

was excessive and should be shortened.

Response: This recommendation was not adopted because 30 days is

reasonable and necessary for the Secretary to prepare a written report

summarizing the informal conference and making a final decision either

setting forth the procedures or disapproving the proposal.

One comment suggested deleting the requirement that the Secretary

prepare and mail the report and final decision to the State in

paragraph (c).

Response: This recommendation was not adopted because the State is

an involved party in the Class III gaming procedures process as

contemplated by IGRA.

Section 291.9 What must the Secretary do at the end of the 60-day

comment period if the State provides comments offering an alternative

proposal for Class III gaming procedures?

Several comments suggested deleting section 291.9 as unnecessary

and inconsistent with the IGRA scheme.

One comment suggested it served no legitimate purpose since it adds

an additional 60 days to a process which

[[Page 17541]]

will ultimately end up in mediation anyway where the parties can

present their objections and counter-proposals.

Reponse: These recommendations were adopted and the section has

been deleted and rewritten to provide automatic appointment of a

mediator.

One comment received under 291.10 recommended specifying the number

of days in which the mediator will be appointed.

Response: This recommendation was adopted under the newly revised

Section 291.9 and language was added saying the mediator shall be

appointed within 30 days of the Secretary receiving the State's

alternative proposal. See Summary of Comments under section 291.10.

Section 291.10 What must the Indian tribe do when it receives the

State's alternative proposal for Class III gaming procedures?

Several comments recommended this section be deleted as unnecessary

and inconsistent with the IGRA scheme or be revised to provide for

automatic appointment of a mediator.

Response: The recommendation to delete as unnecessary and

inconsistent was adopted, and the recommendation to revise is adopted

under the new revised section 291.9.

The comment further recommended to revise the section and specify

the number of days in which the mediator will be appointed.

Response: This recommendation was adopted and language was added to

the new revised section 291.9 saying the mediator shall be appointed

within 30 days of receiving the State's alternative proposal. See

Summary of Comments under section 291.9.

One comment recommended revising the section to provide for a

mechanism that establishes procedures if the Secretary disapproves the

State's alternative proposal.

Response: This comment was not adopted because this paragraph has

been deleted.

Section 291.11 What must the Secretary do if the Indian tribe files

timely objections to the State's alternative proposal?

Several comments recommended setting forth qualifications of the

mediator. One comment recommended requiring the mediator have

familiarity and knowledge of IGRA.

Response: This recommendation was not adopted because it is

unnecessary.

One comment recommended that the tribe have considerable input into

the Secretary's selection.

Response: This recommendation was not adopted to maintain a

fairness and timeliness in the process.

One comment recommended conflict of interest standards.

Response: This recommendation was adopted and the new revised

section 291.9 includes such standards.

Several comments recommended the section be revised to include a

specific time period in which the Secretary must appoint the mediator.

One comment recommended 20 days.

Response: These recommendations were partially adopted, and the new

revised section 291.9 includes a 30-day time period as being reasonable

and necessary.

One comment suggested revising the section to include a time frame

in which the mediator issues a decision.

Response: This recommendation was not adopted in order to remain

consistent with IGRA requirements, to maintain flexibility in the

mediation process and to avoid imposition of time constraints on the

mediator. During the mediation process, the parties are free to

mutually consent to self-imposed time constraints. The IGRA does not

impose such constraints on the mediator or mediation process. This

section was deleted as unnecessary due to the automatic appointment of

a mediator under revised section 291.9 and the sections were renumbered

accordingly.

Section 291.12 What is the role of the mediator appointed by the

Secretary?

This section was renumbered section 291.10 due to the deletion of

sections 291.9 and 291.10 of the proposed rule.

Several comments recommended imposing specific procedural

guidelines and specific time lines on the mediator and mediation

process.

Response: These recommendations were not adopted in order to be

consistent with IGRA and to maintain flexibility in the mediation

process. During the mediation process, the parties are free to mutually

consent to self-imposed procedures and/or time lines. The IGRA does not

impose procedures or deadlines on the mediator or mediation process.

One comment recommended revising the section to include the

requirement that the mediator apply the canons of construction by which

all ambiguities should be resolved in favor of the tribe.

Response: This recommendation was not adopted because the

mediator's discharge of his or her responsibilities will be guided by

applicable law, including canons of statutory construction which will

be applied by the mediator as applicable.

One comment suggested the words ``opportunity to be heard'' as

being ambiguous and recommended specifying whether it requires an oral

hearing unless the parties waive the requirement.

Response: This recommendation was not adopted because the mediation

process is not a formal administrative or adjudicatory process. The

mediation process requires flexibility and the parties are free to

mutually consent to self-imposed procedures.

Section 291.13 What must the Secretary do upon receiving the proposal

selected by the mediator?

This section was renumbered section 291.11 due to the deletion of

sections 291.9 and 291.10 of the proposed rule.

One comment suggested changing the 60-day requirement to 45 days

which IGRA provides for approval or disapproval of gaming compacts.

Response: This recommendation was not adopted because 60 days is

reasonable and necessary to make substantive determinations regarding

the mediator's selected proposal.

One comment recommended that paragraph (b) be revised to list only

the disapproval criteria for compacts as set forth in IGRA, section

2710(b)(8).

Response: This recommendation was not adopted because the Class III

gaming procedures must comply not only with section 2710(b)(8) of IGRA

but also must comply with the requirements for Class III gaming

procedures in section 291.4 and the requirements in section

2710(b)(7)(B)(vii).

One comment recommended providing for automatic approval of the

mediator's selected proposal because under IGRA, the compact must be

approved except for enumerated reasons set forth in section 2710(b)(8).

Response: This recommendation was not adopted because the Class III

gaming procedures must comply not only with section 2710(b)(8) of IGRA,

but also with the requirements for Class III gaming procedures in

section 291.4 and the requirements in section 2710(b)(7)(B)(vii) of

IGRA.

One comment recommended revising the section to include the

requirement that when deciding whether to approve or disapprove the

proposal selected by the mediator, the Secretary must apply the canons

of construction by which all ambiguities should be resolved in favor of

the tribe.

Response: This recommendation was not adopted because the

Secretary's discharge of his or her responsibilities will be guided by

applicable law, including canons of statutory

[[Page 17542]]

construction which will be applied by the Secretary as applicable.

Several comments recommended changing paragraph (c) to require the

Secretary to issue procedures if the mediator's proposal is rejected.

Response: This recommendation was adopted and the word ``may'' in

paragraph (c) was replaced by the word ``shall'' to more closely track

the statutory language in 25 U.S.C. 2710(d)(7)(B)(vii).

One comment recommended specifying a time frame within which the

Secretary prescribes procedures under paragraph (c).

Response: This recommendation was adopted and a 60-day requirement

has been added.

One comment suggested paragraph (c) was confusing because it

appeared the Secretary was adopting the mediator's selected proposal

even though he/she was rejecting it.

Response: This recommendation was adopted and language was added to

clarify that the Secretary will use the mediator's selected proposal as

much as possible while comporting with IGRA and relevant provisions of

State law.

One comment recommended under paragraph (c) the Secretary be

required to explain in writing the specific reasons for disapproval.

Response: This recommendation was not adopted because that

requirement is already specified in paragraph (a). The words ``in the

event'' were changed to ``if'' for clarification.

Section 291.14 When do Class III gaming procedures for an Indian tribe

become effective?

This section was renumbered section 291.13 due to the deletions of

sections 291.9 and 291.10 of the proposed rule.

Language referencing section 291.10(b)(1) was deleted because

section 291.10 has been deleted due to the new revised section 291.9.

One comment recommended specifying that the Secretary shall have 15

days to publish the procedures in the Federal Register.

Another comment recommended adding the words ``as soon as

possible'' to make sure there is no delay.

Response: These recommendations were not adopted as being

unnecessary or too vague, and to remain consistent with IGRA's

language. The IGRA does not provide for a specific publication time,

but it is the Secretary's intention to publish the notice

expeditiously.

Section 291.15 How can Class III gaming procedures approved by the

Secretary be amended?

This section was renumbered section 291.14 due to the deletions of

sections 291.9 and 291.10 of the proposed rule.

One comment suggested the section is unwieldy if the regulations do

not take the States out of the Class III gaming procedures process.

Response: This recommendation was not adopted because it cannot be

assumed that the States will fail to participate in amendments. States

are involved parties as contemplated by IGRA.

One comment suggested this section erroneously made amendments to

the Class III gaming procedures subject to the process in section

291.3.

Response: This recommendation was adopted and the section was

clarified to explicitly exclude procedures amendments to the

requirements of section 291.3.

One comment recommended a two-tiered approach to Class III gaming

procedures amendments.

Response: This recommendation was not adopted in order to keep the

same process applicable to amendments as to original proposals.

One comment suggested specifying the duration of Class III gaming

procedures. The comment recommended stating the procedures would be

valid in perpetuity or for a term certain, unless the Secretary either

approves an amendment to the procedures or repeals them, or unless the

Indian tribe requires cancellation. The comment recommended that

procedures remain in effect regardless of any changes in state law

during the length of the term.

Response: This recommendation was partially adopted and a new

section 291.15 was added to provide that procedures will remain in

effect for the duration specified in the procedures themselves, or

until amended. In addition, section 291.4(j) was amended to require the

Indian tribe's proposal to address the length of time the procedures

will remain in effect. Finally, this new section will not address the

effect of any changes in state law on existing procedures because the

effect of any such change is not explicitly resolved by IGRA, and has

not been settled by the courts. Accordingly, the Department has

determined not to take a position on this issue in these regulations.

One comment suggested the regulations do not state whether the

Secretary's decisions can be appealed or if the decisions are

considered final.

Response: This recommendation was not adopted because the

Department of the Interior (Department) already has regulations

specifying appealability in 25 CFR Sec. 2 et seq.

Executive Order 12866

This is a significant rule under Executive Order (E.O.) 12866 and

has been reviewed by Office of Management and Budget (OMB).

Regulatory Flexibility Act

The Department certifies that this document will 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. Indian

tribes are not considered to be small entities for purposes of this

Act.

Small Business Regulatory Enforcement Fairness Act

This rule is not a major rule under 5 U.S.C. 804(2), the Small

Business Regulatory Enforcement Fairness Act. This rule does not have

an annual effect on the economy of $100 million or more.

This rule will not cause a major increase in costs or prices for

consumers, individual industries, Federal, State or local government

agencies or geographic regions and does not have significant adverse

effects on competition, employment, investment, productivity,

innovation, or the ability to U.S.-based enterprises to compete with

foreign-based enterprises.

Unfunded Mandates Act of 1995

This regulation imposes no unfunded mandate on any governmental or

private entity and is in compliance with the provisions of the Unfunded

Mandates Act of 1995.

Executive Order 12630

The Department has determined that this rule does not have

significant ``takings'' implications. The rule does not pertain to

``taking'' of private property interests, nor does it impact private

property.

Executive Order 12612

The Department has determined that this rule does not have

significant Federalism effects.

As explained above, the Secretary has determined that he has the

statutory authority to adopt procedures to permit Indian gaming in

appropriate circumstances. Secretarial authority was expressly provided

in IGRA with respect to the judicially-supervised mediation scheme. It

would be exercised under the rule in a manner consistent with the

statutory directive

[[Page 17543]]

and congressional intent. The rule provides the opportunity for States

to voluntarily participate in a mediation process under the auspices of

the Secretary. As the Supreme Court noted in Seminole, Congress may,

under the Constitution, choose to withhold from States any authority

over Indian gaming. Under the rule, the Secretary would be tracking the

scheme set forth by Congress and the rule would afford the States as

much opportunity to participate as where it does not claim immunity

from suit.

Executive Order 12988

The Department has certified to OMB that these regulations meet the

applicable standards provided in sections (3)(a) and 3(b)(2) of E.O.

12988.

Paperwork Reduction Act of 1995

Sections 291.4, 291.10, 291.12, and 291.15 contain information

collection requirements. The BIA has submitted a request for emergency

clearance by OMB for this collection of information.

The information requested will be unique for each tribe and may be

changed when necessary to fit the needs of the tribe.

All information is to be collected upon the submission of a request

by a tribe for Class III gaming procedures. The annual reporting and

record keeping burden for the collection of information is estimated to

average 1,000 hours for each response and we estimate there will be

approximately 12 respondents. The collection will include time for

reviewing instructions, searching existing data sources, gathering and

maintaining the data needed, and completing and reviewing the

information. The total annual burden is estimated to be 12,000 hours.

The Paperwork Reduction Act of 1995 requires us to tell you that a

Federal Agency may not conduct or sponsor, and a person is not required

to respond to, a collection of information unless it displays a

currently valid OMB control number.

NEPA Statement

The Department has determined that this proposed rule does not

constitute a major Federal action significantly affecting the quality

of the human environment and that no detailed statement is required

pursuant to the National Environmental Policy Act of 1969.

Drafting Information: The primary author of this proposed rule is

George Skibine, Director, Indian Gaming Management Staff, Bureau of

Indian Affairs.

List of Subjects in 25 CFR Part 291

Indians--business and finance, Indians--Gaming

For the reasons given in the preamble, part 291 is added to Title

25, Chapter 1 of the Code of Federal Regulations to read as set forth

below.

PART 291--Class III Gaming Procedures

Sec.

291.1 Purpose and scope.

291.2 Definitions.

291.3 When may an Indian tribe ask the Secretary to issue Class III

gaming procedures?

291.4 What must a proposal requesting Class III gaming procedures

contain?

291.5 Where must the proposal requesting Class III gaming

procedures be filed?

291.6 What must the Secretary do upon receiving a proposal?

291.7 What must the Secretary do if it has been determined that the

Indian tribe is eligible to request Class III gaming procedures?

291.8 What must the Secretary do at the expiration of the 60-day

comment period if the State has not submitted an alternative

proposal?

291.9 What must the Secretary do at the end of the 60-day comment

period if the State offers an alternative proposal for Class III

gaming procedures?

291.10 What is the role of the mediator appointed by the Secretary?

291.11 What must the Secretary do upon receiving the proposal

selected by the mediator?

291.12 Who will monitor and enforce tribal compliance with the

Class III gaming procedures?

291.13 When do Class III gaming procedures for an Indian tribe

become effective?

291.14 How can Class III gaming procedures issued by the Secretary

be amended?

291.15 How long do Class III gaming procedures remain in effect?

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

Sec. 291.1 Purpose and scope.

The regulations in this part establish procedures that the

Secretary will use to promulgate rules for the conduct of Class III

Indian gaming when:

(a) A State and an Indian tribe are unable to voluntarily agree to

a compact and;

(b) The State has asserted its immunity from suit brought by an

Indian tribe under 25 U.S.C. 2710(d)(7)(B).

Sec. 291.2 Definitions

(a) All terms have the same meaning as set forth in the

definitional section of IGRA, 25 U.S.C. section 2703(1)-(10).

(b) The term ``compact'' includes renewal of an existing compact.

Sec. 291.3 When may an Indian tribe ask the Secretary to issue Class

III gaming procedures?

An Indian tribe may ask the Secretary to issue Class III gaming

procedures when the following steps have taken place:

(a) The Indian tribe submitted a written request to the State to

enter into negotiations to establish a Tribal-State compact governing

the conduct of Class III gaming activities;

(b) The State and the Indian tribe failed to negotiate a compact

180 days after the State received the Indian tribe's request;

(c) The Indian tribe initiated a cause of action in Federal

district court against the State alleging that the State did not

respond, or did not respond in good faith, to the request of the Indian

tribe to negotiate such a compact;

(d) The State raised an Eleventh Amendment defense to the tribal

action; and

(e) The Federal district court dismissed the action due to the

State's sovereign immunity under the Eleventh Amendment.

Sec. 291.4 What must a proposal requesting Class III gaming procedures

contain?

A proposal requesting Class III gaming procedures must include the

following information:

(a) The full name, address, and telephone number of the Indian

tribe submitting the proposal;

(b) A copy of the authorizing resolution from the Indian tribe

submitting the proposal;

(c) A copy of the Indian tribe's gaming ordinance or resolution

approved by the NIGC in accordance with 25 U.S.C. 2710, if any;

(d) A copy of the Indian tribe's organic documents, if any;

(e) A copy of the Indian tribe's written request to the State to

enter into compact negotiations, along with the Indian tribe's proposed

compact, if any;

(f) A copy of the State's response to the tribal request and/or

proposed compact, if any;

(g) A copy of the tribe's Complaint (with attached exhibits, if

any); the State's Motion to Dismiss; any Response by the tribe to the

State's Motion to Dismiss; any Opinion or other written documents from

the court regarding the State's Motion to Dismiss; and the Court's

Order of dismissal;

(h) The Indian tribe's factual and legal authority for the scope of

gaming specified in paragraph (j)(13) of this section;

(i) Regulatory scheme for the State's oversight role, if any, in

monitoring and enforcing compliance; and

[[Page 17544]]

(j) Proposed procedures under which the Indian tribe will conduct

Class III gaming activities, including:

(1) A certification that the tribe's accounting procedures are

maintained in accordance with American Institute of Certified Public

Accountants Standards for Audits of Casinos, including maintenance of

books and records in accordance with Generally Accepted Accounting

Principles and applicable NIGC regulations;

(2) A reporting system for the payment of taxes and fees in a

timely manner and in compliance with Internal Revenue Code and Bank

Secrecy Act requirements;

(3) Preparation of financial statements covering all financial

activities of the Indian tribe's gaming operations;

(4) Internal control standards designed to ensure fiscal integrity

of gaming operations as set forth in 25 CFR Part 542;

(5) Provisions for records retention, maintenance, and

accessibility;

(6) Conduct of games, including patron requirements, posting of

game rules, and hours of operation;

(7) Procedures to protect the integrity of the rules for playing

games;

(8) Rules governing employees of the gaming operation, including

code of conduct, age requirements, conflict of interest provisions,

licensing requirements, and such background investigations of all

management officials and key employees as are required by IGRA, NIGC

regulations, and applicable tribal gaming laws;

(9) Policies and procedures that protect the health and safety of

patrons and employees and that address insurance and liability issues,

as well as safety systems for fire and emergency services at all gaming

locations;

(10) Surveillance procedures and security personnel and systems

capable of monitoring movement of cash and chips, entrances and exits

of gaming facilities, and other critical areas of any gaming facility;

(11) An administrative and/or tribal judicial process to resolve

disputes between gaming establishment, employees and patrons, including

a process to protect the rights of individuals injured on gaming

premises by reason of negligence in the operation of the facility;

(12) Hearing procedures for licensing purposes;

(13) A list of gaming activities proposed to be offered by the

Indian tribe at its gaming facilities;

(14) A description of the location of proposed gaming facilities;

(15) A copy of the Indian tribe's liquor ordinance approved by the

Secretary if intoxicants, as used in 18 U.S.C. 1154, will be served in

the gaming facility;

(16) Provisions for a tribal regulatory gaming entity, independent

of gaming management;

(17) Provisions for tribal enforcement and investigatory

mechanisms, including the imposition of sanctions, monetary penalties,

closure, and an administrative appeal process relating to enforcement

and investigatory actions;

(18) The length of time the procedures will remain in effect; and

(19) Any other provisions deemed necessary by the Indian tribe.

Sec. 291.5 Where must the proposal requesting Class III gaming

procedures be filed?

Any proposal requesting Class III gaming procedures must be filed

with the Director, Indian Gaming Management Staff, Bureau of Indian

Affairs, U.S. Department of the Interior, MS 2070-MIB, 1849 C Street

NW, Washington, DC 20240.

Sec. 291.6 What must the Secretary do upon receiving a proposal?

Upon receipt of a proposal requesting Class III gaming procedures,

the Secretary must:

(a) Within 15 days, notify the Indian tribe in writing that the

proposal has been received, and whether any information required under

Sec. 291.4 is missing;

(b) Within 30 days of receiving a complete proposal, notify the

Indian tribe in writing whether the Indian tribe meets the eligibility

requirements in Sec. 291.3. The Secretary's eligibility determination

is final for the Department.

Sec. 291.7 What must the Secretary do if it has been determined that

the Indian tribe is eligible to request Class III gaming procedures?

(a) If the Secretary determines that the Indian tribe is eligible

to request Class III gaming procedures and that the Indian tribe's

proposal is complete, the Secretary must submit the Indian tribe's

proposal to the Governor and the Attorney General of the State where

the gaming is proposed.

(b) The Governor and Attorney General will have 60 days to comment

on:

(1) Whether the State is in agreement with the Indian tribe's

proposal;

(2) Whether the proposal is consistent with relevant provisions of

the laws of the State;

(3) Whether contemplated gaming activities are permitted in the

State for any purposes, by any person, organization, or entity.

(c) The Secretary will also invite the State's Governor and

Attorney General to submit an alternative proposal to the Indian

tribe's proposed Class III gaming procedures.

Sec. 291.8 What must the Secretary do at the expiration of the 60-day

comment period if the State has not submitted an alternative proposal?

(a) Upon expiration of the 60-day comment period specified in

Sec. 291.7, if the State has not submitted an alternative proposal, the

Secretary must review the Indian tribe's proposal to determine:

(1) Whether all requirements of Sec. 291.4 are adequately

addressed;

(2) Whether Class III gaming activities will be conducted on Indian

lands over which the Indian tribe has jurisdiction;

(3) Whether contemplated gaming activities are permitted in the

State for any purposes by any person, organization, or entity;

(4) Whether the proposal is consistent with relevant provisions of

the laws of the State;

(5) Whether the proposal is consistent with the trust obligations

of the United States to the Indian tribe;

(6) Whether the proposal is consistent with all applicable

provisions of IGRA; and

(7) Whether the proposal is consistent with provisions of other

applicable Federal laws.

(b) Within 60 days of the expiration of the 60-day comment period

in Sec. 291.7, the Secretary must notify the Indian tribe, the

Governor, and the Attorney General of the State in writing that he/she

has:

(1) Approved the proposal if the Secretary determines that there

are no objections to the Indian tribe's proposal; or

(2) Identified unresolved issues and areas of disagreements in the

proposal, and invite the Indian tribe, the Governor and the Attorney

General to participate in an informal conference, within 30 days of

notification unless the parties agree otherwise, to resolve identified

unresolved issues and areas of disagreement.

(c) Within 30 days of the informal conference, the Secretary must

prepare and mail to the Indian tribe, the Governor and the Attorney

General:

(1) A written report that summarizes the results of the informal

conference; and

(2) A final decision either setting forth the Secretary's proposed

Class III gaming procedures for the Indian tribe, or disapproving the

proposal for any of the reasons in paragraph (a) of this section.

[[Page 17545]]

Sec. 291.9 What must the Secretary do at the end of the 60-day comment

period if the State offers an alternative proposal for Class III gaming

procedures?

Within 30 days of receiving the State's alternative proposal, the

Secretary must appoint a mediator who:

(a) Has no official, financial, or personal conflict of interest

with respect to the issues in controversy; and

(b) Must convene a process to resolve differences between the two

proposals.

Sec. 291.10 What is the role of the mediator appointed by the

Secretary?

(a) The mediator must ask the Indian tribe and the State to submit

their last best proposal for Class III gaming procedures.

(b) After giving the Indian tribe and the State an opportunity to

be heard and present information supporting their respective positions,

the mediator must select from the two proposals the one that best

comports with the terms of IGRA and any other applicable Federal law.

The mediator must submit the proposal selected to the Indian tribe, the

State, and the Secretary.

Sec. 291.11 What must the Secretary do upon receiving the proposal

selected by the mediator?

Within 60 days of receiving the proposal selected by the mediator,

the Secretary must do one of the following:

(a) Notify the Indian tribe, the Governor and the Attorney General

in writing of his/her decision to approve the proposal for Class III

gaming procedures selected by the mediator; or

(b) Notify the Indian tribe, the Governor and the Attorney General

in writing of his/her decision to disapprove the proposal selected by

the mediator for any of the following reasons:

(1) The requirements of Sec. 291.4 are not adequately addressed;

(2) Gaming activities would not be conducted on Indian lands over

which the Indian tribe has jurisdiction;

(3) Contemplated gaming activities are not permitted in the State

for any purpose by any person, organization, or entity;

(4) The proposal is not consistent with relevant provisions of the

laws of the State;

(5) The proposal is not consistent with the trust obligations of

the United States to the Indian tribe;

(6) The proposal is not consistent with applicable provisions of

IGRA; or

(7) The proposal is not consistent with provisions of other

applicable Federal laws.

(c) If the Secretary rejects the mediator's proposal under

paragraph (b) of this section, he/she must prescribe appropriate

procedures within 60 days under which Class III gaming may take place

that comport with the mediator's selected proposal as much as possible,

the provisions of IGRA, and the relevant provisions of the laws of the

State.

Sec. 291.12 Who will monitor and enforce tribal compliance with the

Class III gaming procedures?

The Indian tribe and the State may have an agreement regarding

monitoring and enforcement of tribal compliance with the Indian tribe's

Class III gaming procedures. In addition, under existing law, the NIGC

will monitor and enforce tribal compliance with the Indian tribe's

Class III gaming procedures.

Sec. 291.13 When do Class III gaming procedures for an Indian tribe

become effective?

Upon approval of Class III gaming procedures for the Indian tribe

under either Sec. 291.8(b), Sec. 291.8(c), or Sec. 291.11(a), the

Indian tribe shall have 90 days in which to approve and execute the

Secretarial procedures and forward its approval and execution to the

Secretary, who shall publish notice of their approval in the Federal

Register. The procedures take effect upon their publication in the

Federal Register.

Sec. 291.14 How can Class III gaming procedures approved by the

Secretary be amended?

An Indian tribe may ask the Secretary to amend approved Class III

gaming procedures by submitting an amendment proposal to the Secretary.

The Secretary must review the proposal by following the approval

process for initial tribal proposals, except that the requirements of

Sec. 291.3 are not applicable and he/she may waive the requirements of

Sec. 291.4 to the extent they do not apply to the amendment request.

Sec. 291.15 How long do Class III gaming procedures remain in effect?

Class III gaming procedures remain in effect for the duration

specified in the procedures or until amended pursuant to Sec. 291.14.

Dated: April 1, 1999.

Kevin Gover,

Assistant Secretary--Indian Affairs.

[FR Doc. 99-8910 Filed 4-9-99; 8:45 am]

BILLING CODE 4310-02-P