Tribes Of Oklahoma Finally Beat The Governor Over Gaming Compact Renewal

Article by : Helen Aug 3, 2020

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Updated: Apr 6, 2023

More recently, it became known that the largest operators of Oklahoma tribal casinos received a favorable verdict in the litigation with the Gov. regarding the dispute over the gaming agreement. US District Court Judge reportedly issued a formal ruling on Tuesday. It confirmed the possibility of an automatic extension of the gambling agreement between the government regulator and the biggest tribal casinos.

This decree extended the agreement from January 1, 2020. This is a formal agreement that was concluded in 2005 and was considered valid for 15 years after signing. However, Gov. Kevin Stitt did not seem to compromise on the renewal of the document. He informed that the percentage of income that gambling establishments pay to the state budget is too low. Stitt wanted to ascertain that the first deal, which was completed in 2004 with local tribes, was renegotiated to increase the rate that is paid to the state budget.

Previously, local tribes were required to pay from 4 to 10% to the budget. Stitt offered a 20% cut of the earnings in return for exclusive terms to casinos. In turn, the operators confirmed that they agreed to sign the previously concluded terms of the agreement if the Gov. recognizes that these agreements will be automatically renewed again starting from 2020. However, Stitt was backpedaled on his decision, and the local tribal representatives decided to sue him in federal court.

The tribes argued their claims based on one of the clauses of the 2004 agreement. Following the previously signed terms, this agreement provides for the automatic renewal of all specified conditions if racetracks located in the states are also approved for online betting. Recall that, the Oklahoma Horse Racing Commission started to actively issue official licenses for electronic games for representatives of tribal casinos and racetracks in 2005. It is these steps that the casinos perceive as official actions on the part of the state government, which, in fact, is a confirmation that the agreement from 2004 can be automatically reiterated.

The Governor insisted that the Commission started providing official licenses before the tribal treaty officially entered into force. Free licenses were nothing more than the fulfillment of some administrative regulations, which is one of the regulators’ primary tasks. Thus, the issuance of a permit by a commission cannot be qualified as an official action on the part of the authorities or the court. Anyway, the Honorable Judge Degiusti didn’t fall for his hook.

The Commission issued licenses after the agreement with local tribes came into force.

Accordingly, the actions of the authorities’ side can be recognized as such, which allows tribes to automatically extend the agreement with the tribes from 2020. It is not the first time the Governor has lost a lawsuit over tribal game arrangements. Last week, the Oklahoma Supreme Court stated that the Gov. went beyond his powers to approve treaties with several tribes with no sides to the lawsuit.

The Oklahoma casinos are some of the most profitable gambling establishments in the United States. The revenues of Indian gambling companies in 2017 showed a stable growth of 3.9%, which amounted to $32.4 billion. To better understand what this is about, the revenue for Las Vegas from the sale of food, drinks, hotel services, and casinos amounted to more than $23 billion. Although people visit Las Vegas mainly on vacation, local casinos that are open to visitors all year round are a more profitable business model. It seems like the tribal casinos can continue to coin money now.