News and analysis from The Center for Michigan • http://thecenterformichigan.net
©2016 Bridge Michigan. All Rights Reserved. • Join us online at http://bridgemi.com

Original article URL: http://bridgemi.com/2013/08/state-seeks-tighter-oversight-of-indian-casinos-local-revenue-sharing/

Public sector

State seeks tighter oversight of Indian casinos’ local revenue sharing

Since Indian casino gambling in Michigan began in 1994, seven tribes have doled out more than $200 million in communities surrounding their casinos.  It was widely presumed, under a federal decree governing these payouts, that 2 percent of slot machine and video gaming profits would go to local government to compensate for economic costs of casino operations.

Most of it has. But over the years, some of the money has funded everything from tribal members’ property taxes to a tribal documentary to a ski hall of fame.

A 2006 investigation by the Detroit Free Press found the local distribution included more than $100,000 that went to Central Michigan University for a documentary about the Grand Traverse Band of Ottawa and Chippewa Indians and nearly $700,000 over a period of years to pay property taxes for members of the Keewenaw Bay Indian Community.

More recently, a 2012 annual report by the Michigan Gaming Control Board noted that tribes were directing payments to “circumvent the requirements” of their compacts and “remitting payments that appear to have no clear connection as reimbursement for government services” related to the operation of a tribal casino.

David Hicks, Indian gaming audit manager for the Michigan Gaming Control Board, has jousted a few times with the Grand Traverse Band over its disbursement of casino revenues.

In 2012, he told the Leelanau Enterprise that state officials had to “come up to Leelanau County a few times over the years to speak with tribal officials and let them know we didn’t think they were complying with the agreement.

“They’d make some adjustments, but they’re a sovereign nation, and there’s only so much we can do to make them comply without taking them to federal court.”

While that may be, language in the 1993 consent decree doesn’t seem to leave much wiggle room. It spells out 2 percent payments of casino profits shall go “to any local units of state government in the immediate vicinity” of the casino and adds that tribes shall determine which “local unit or units of government shall receive payments.”

The payments are to compensate “for impacts associated with the existence” of the casinos.

According to tribal officials, the state is seeking in compact negotiations the kind of strict oversight that was approved in five compacts negotiated since 1993. Under the agreements, distribution of the 2 percent local share is determined by a revenue sharing board, comprised of representatives of local government or schools and tribal members. Payouts are to go only to local schools or units of government.

For the Gun Lake Casino in Allegan County, the local revenue sharing formula is concrete and specific.

The local share first pays local units of governments for direct costs associated with the casino, such as the hiring of extra sheriff’s deputies. Though the casino is not subject to taxation, it pays designated local units the equivalent of those taxes, an amount capped at 65 percent of payments. Of the remainder, 50 percent goes to Wayland Township, 25 percent to Allegan County, 8 percent to Wayland Union Schools with 3 percent split among several local units.

In 2012, it distributed more than $3.2 million.

“It has been very positive for everybody,” said Linden Anderson, a former Wayland Union assistant principal and member of the six-member revenue sharing board. It is split between three community representatives and three members representing the tribe.

Anderson said he believes it only right to spell out precisely where payouts go.

Otherwise, he said, “Everybody would want a piece of the pie.”

Gaming consultant Jake Miklojcik, president of Lansing-based Michigan Consultants, believes better oversight of the 2-percent payout would mark a reasonable change in new compacts.

“It makes sense. I never liked having the tribes having that much say in that.”

Ted Roelofs worked for the Grand Rapids Press for 30 years, where he covered everything from politics to social services to military affairs. He has earned numerous awards, including for work in Albania during the 1999 Kosovo refugee crisis.

No comment yet.Add mine!

Leave your comment...

Your email address will not be published.

Currently on Bridge

The email trail of the latest workers charged in Flint water crisis

More than pipes and penny-pinching: Flint crisis reflects racism

Missing in action: Michigan's primary voters

Amid guns and violence and police shootings, a program that works

Dental therapists are the wrong answer to improving oral health in Michigan

There’s a better place for that building than in the dump

State education proposal would add $1.4 billion to school budget

The 3 biggest head-scratchers in Michigan education cost study

When elites ignore the people, the center cannot hold

Battle in Lansing over community colleges expanding 4-year degrees

Michigan’s low investment in child care costs state and poor children alike

Allowing ‘dental therapists’ in Michigan will expand access to oral care

In Flint, questions about Legionnaires’ death toll

Should Waukesha be able to stick a straw into Lake Michigan? Yes.

Booming again: West Michigan’s economy is on a roll

More time in classroom equals more learning, but the details matter

Put down your No. 2 pencils: Too much testing in public schools

Dow Chemical being courted by other states

House plan for Detroit schools excludes Education Commission, key to success

Not waiting for government, philanthropy steps up to help Flint

People need jobs. Factories need workers. Busing, a love story.

Are tampons as essential as toilet paper? Menstruation goes mainstream

It’s right for Malia Obama, but is a gap year right for you?

Failing infrastructure threatens Michigan’s public health, safety and economy

Higher ed is key to a state’s success, and should be supported

Invest in non-partisan journalism.

Donate to The Center for Michigan. Find out why.