[Congressional Record Volume 149, Number 116 (Thursday, July 31, 2003)]
[Senate]
[Pages S10653-S10656]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CAMPBELL (for himself and Mr. Inouye):
  S. 1529. A bill to amend the Indian Gaming Regulatory Act to include 
provisions relating to the payment and administration of gaming fees, 
and for other purposes; to the Committee on Indian Affairs.

  Mr. CAMPBELL. Mr. President, today I am pleased to be joined by 
Senator Inouye in introducing the Indian Gaming Regulatory Act 
Amendments of 2003 to amend and update the act.
  In amending the Indian Gaming Regulatory Act of 1988 (IGRA) it is 
important to keep in mind the twin aims of the act: to ensure that 
gaming continues to be a tool for Indian economic development; and to 
ensure that the games conducted are kept free from corrupting forces to 
maintain the integrity of the industry.
  This bill will update the IGRA by clarifying how vacancies in the 
National Indian Gaming Commission (NIGC) are filled; revising the NIGC 
statutory rates of pay to correspond with other current Federal rates 
of pay; and expanding the NIGC's reporting requirements to Congress.
  The bill also clarifies the act by making the Johnson Act 
inapplicable to class II technological aids to bring it in line with 
the original intent of Congress in 1988.
  The bill also requires background checks on class III management 
contractors, management employees, and gaming commissioners.
  When the IGRA was enacted in 1988, Indian gaming was mainly high 
stakes bingo operations, known as ``class II gaming'' under the act. 
Virtually no one thought Indian gaming would become the $14.5 billion 
dollar industry that it is today, providing tribes with resources for 
development and employment opportunities where none previously existed.
  In response to this success, questions have been raised--some 
legitimate, some not--about the efficacy of regulation within the 
industry. This bill requires that the NIGC and the gaming tribes 
develop and implement a system of minimum internal control, background 
investigation and licensing standards for all tribes that operate class 
II and class III gaming.
  The bill would also ensure that the NIGC has the resources it needs 
to fulfill its regulatory duties by increasing the fee cap 50 percent 
over the next six years. With that budgetary increase, and prior to 
levying any fees, the NIGC would be required to determine and take into 
account the nature and level of any tribal or joint tribal-state 
regulatory activities and to reduce the fees assessed accordingly.
  The bill will enable the NIGC to provide technical assistance and 
training to Indian tribes. The NIGC would be authorized to expend the 
civil fines it recoups for violations of the IGRA for these purposes.
  The last substantive reform in the bill goes to the very heart of the 
act--economic development for Indian tribes. Because of gaming, some 
tribes have been very successful, employing thousands of people, both 
Indian and non-Indian, and reducing poverty and the welfare rolls in 
their areas.
  This success has attracted the attention of other governments, cash-
strapped and hungry for new revenues. Many States are looking to gaming 
tribes to help eliminate their deficits, and some States are reportedly 
refusing to enter or renew compacts required under IGRA until tribes 
agree to revenue sharing provisions.
  Congress never envisioned that kind of pressure would be applied to 
tribes and, keeping these facts and the goals of IGRA in mind, the bill 
includes provisions to ensure that tribal gaming revenues are first 
used to meet the needs of tribal governments and their members. Only 
after satisfying those needs, would States and tribes be able to 
negotiate a revenue-sharing agreement.
  To encourage States and tribes to negotiate, the bill requires the 
Secretary to perform her existing responsibilities under the act within 
90 days and, at the back end, when existing compacts are up for 
renewal, the bill provides a 180 day grace period beyond the expiration 
date of compacts to encourage tribal-State agreements.
  I ask unanimous consent that a copy of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1529

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Indian Gaming Regulatory Act 
     Amendments of 2003''.

      SEC. 2. PAYMENT AND ADMINISTRATION OF GAMING FEES.

       (a) Definitions.--Section 4(7) of the Indian Gaming 
     Regulatory Act (25 U.S.C. 2703(7)) is amended by adding at 
     the end the following:
       ``(G) Technological aids.--Notwithstanding any other 
     provision of law, sections 1 through 7 of the Act of January 
     2, 1951 (commonly known as the `Gambling Devices 
     Transportation Act') (15 U.S.C. 1171 through 1177) shall not 
     apply to any gaming described in subparagraph (A)(i) for 
     which an electronic aid, computer, or other technological aid 
     is used in connection with the gaming.''.
       (b) National Indian Gaming Commission.--Section 5 of the 
     Indian Gaming Regulatory Act (25 U.S.C. 2704) is amended--
       (1) by striking subsection (c) and inserting the following:
       ``(c) Vacancies.--

[[Page S10654]]

       ``(1) In general.--A vacancy on the Commission shall be 
     filled in the same manner as the original appointment.
       ``(2) Successors.--Unless a member of the Commission is 
     removed for cause under subsection (b)(6), the member may--
       ``(A) be reappointed; and
       ``(B) serve after the expiration of the term of the member 
     until a successor is appointed.''; and
       (2) in subsection (e), in the last sentence, by inserting 
     ``or disability'' after ``in the absence''.
       (c) Powers of Chairman.--Section 6 of the Indian Gaming 
     Regulatory Act (25 U.S.C. 2705) is amended by adding at the 
     end the following:
       ``(c) Delegation.--The Chairman may delegate to an 
     individual Commissioner any of the authorities described in 
     subsection (a).
       ``(d) Applicable Authority.--In carrying out any function 
     under this section, a Commissioner serving in the capacity of 
     the Chairman shall be governed by--
       ``(1) such general policies as are formally adopted by the 
     Commission; and
       ``(2) such regulatory decisions, findings, and 
     determinations as are made by the Commission.''.
       (d) Powers of Commission.--Section 7 of the Indian Gaming 
     Regulatory Act (25 U.S.C. 2706) is amended--
       (1) in paragraphs (1), (2), and (4) of subsection (b), by 
     striking ``class II gaming'' each place it appears and 
     inserting ``class II gaming and class III gaming'';
       (2) by redesignating subsection (c) as subsection (d);
       (3) by inserting after subsection (b) the following:
       ``(c) Strategic Plan.--
       ``(1) In general.--The Commission shall develop a strategic 
     plan for use in carrying out activities of the Commission.
       ``(2) Requirements.--The strategic plan shall include--
       ``(A) a comprehensive mission statement describing the 
     major functions and operations of the Commission;
       ``(B) a description of the goals and objectives of the 
     Commission;
       ``(C) a description of the means by which those goals and 
     objectives are to be achieved, including a description of the 
     operational processes, skills and technology, and the human, 
     capital, information, and other resources required to achieve 
     those goals and objectives;
       ``(D) a performance plan for achievement of those goals and 
     objectives that is consistent with--
       ``(i) other components of the strategic plan; and
       ``(ii) section 1115 of title 31, United States Code;
       ``(E) an identification of the key factors that are 
     external to, or beyond the control of, the Commission that 
     could significantly affect the achievement of those goals and 
     objectives; and
       ``(F) a description of the program evaluations used in 
     establishing or revising those goals and objectives, 
     including a schedule for future program evaluations.
       ``(3) Biennial plan.--
       ``(A) Period covered.--The strategic plan shall cover a 
     period of not less than 5 fiscal years beginning with the 
     fiscal year in which the plan is submitted.
       ``(B) Updates and revisions.--The strategic plan shall be 
     updated and revised biennially.''; and
       (4) in subsection (d) (as redesignated by paragraph (2))--
       (A) in paragraph (3), by striking ``and'' at the end;
       (B) by redesignating paragraph (4) as paragraph (5); and
       (C) by inserting after paragraph (3) the following:
       ``(4) the strategic plan for activities of the Commission 
     described in subsection (c); and''.
       (e) Commission Staffing.--Section 8 of the Indian Gaming 
     Regulatory Act (25 U.S.C. 2707) is amended--
       (1) in subsection (a), by striking ``GS-18 of the General 
     Schedule under section 5332'' and inserting ``level IV of the 
     Executive Schedule under section 5318'';
       (2) in subsection (b)--
       (A) by striking ``(b) The Chairman'' and inserting the 
     following:
       ``(b) Staff.--
       ``(1) In general.--The Chairman''; and
       (B) by striking the last sentence and inserting the 
     following:
       ``(2) Compensation.--
       ``(A) In general.--Staff appointed under paragraph (1) 
     shall be paid without regard to the provision of chapter 51 
     and subchapter III of chapter 53, of title 5, United States 
     Code, relating to General Schedule pay rates.
       ``(B) Maximum rate of pay.--The rate of pay for an 
     individual appointed under paragraph (1) shall not exceed the 
     rate payable for level IV of the Executive Schedule under 
     section 5315 of title 5, United States Code.''; and
       (3) by striking subsection (c) and inserting the following:
       ``(c) Temporary Services.--
       ``(1) In general.--The Chairman may procure temporary and 
     intermittent services under section 3109 of title 5, United 
     States Code.
       ``(2) Maximum rate of pay.--The rate of pay for an 
     individual for service described in paragraph (1) shall not 
     exceed the daily equivalent of the maximum rate payable for 
     level IV of the Executive Schedule under section 5318 of 
     title 5, United States Code.
       (f) Tribal Gaming Ordinances.--Section 11 of the Indian 
     Gaming Regulatory Act (25 U.S.C. 2710) is amended--
       (1) in subsection (b)(2)(F), by striking clause (i) and 
     inserting the following:
       ``(i) ensures that--
       ``(I) background investigations are conducted on the tribal 
     gaming commissioners, key tribal gaming commission employees, 
     and primary management officials and key employees of the 
     gaming enterprise; and
       ``(II) oversight of primary management officials and key 
     employees is conducted on an ongoing basis; and''; and
       (2) in subsection (d)--
       (A) in paragraph (4)--
       (i) by striking ``(4) Except'' and inserting the following:
       ``(4) Revenue sharing.--
       ``(A) In general.--Except for any assessments that may be 
     agreed to under paragraph (3)(C)(iii), nothing in this 
     section confers on a State or political subdivision of a 
     State authority to impose any tax, fee, charge, or other 
     assessment on any Indian tribe or any other person or entity 
     authorized by an Indian tribe to engage in a class III 
     activity. No State may refuse to enter into the negotiations 
     described in paragraph (3)(A) based on the lack of authority 
     in the State or a political subdivision of the State to 
     impose such a tax, fee, charge, or other assessment.
       ``(B) Apportionment of revenues.--The Secretary may not 
     approve any Tribal-State compact or other agreement that 
     includes an apportionment of net revenues with a State, local 
     government, or other Indian tribes unless--
       ``(i) in the case of apportionment with other Indian 
     tribes, the net revenues are not distributable by the other 
     Indian tribes to members of the Indian tribes on a per capita 
     basis;
       ``(ii) in the case of apportionment with local governments, 
     the total amount of net revenues exceeds the amounts 
     necessary to meet the requirements of clauses (i) and (ii) of 
     subsection (b)(2)(B), but only to the extent that the excess 
     revenues reflect the actual costs incurred by affected local 
     governments as a result of the operation of gaming 
     activities; or
       ``(iii) in the case of apportionment with a State--

       ``(I) the total amount of net revenues--

       ``(aa) exceeds the amounts necessary to meet the 
     requirements of clauses (i) and (ii) of subsection (b)(2)(B) 
     and clause (ii) of this subparagraph, if applicable; and
       ``(bb) is in accordance with regulations promulgated by the 
     Secretary under subparagraph (C); and

       ``(II) a substantial economic benefit is rendered by the 
     State to the Indian tribe.

       ``(C) Regulations.--Not later than 90 days after the date 
     of enactment of this paragraph, the Secretary shall 
     promulgate regulations to provide guidance to Indian tribes 
     and States on the scope of allowable assessments negotiated 
     under paragraph (3)(C)(iii) and the apportionment of revenues 
     negotiated in accordance with subparagraph (B).'';
       (B) in paragraph (7)(B)(vii), by inserting ``not later than 
     90 days after notification is made'' after ``the Secretary 
     shall prescribe''; and
       (C) by adding at the end the following:
       ``(10) Extension of term of tribal-state compact.--Any 
     Tribal-State compact approved by the Secretary in accordance 
     with paragraph (8) shall remain in effect for up to 180 days 
     after expiration of the Tribal-State compact if--
       ``(A) the Indian tribe certifies to the Secretary that the 
     Indian tribe requested a new compact not later than 90 days 
     before expiration of the compact; and
       ``(B) a new compact has not been agreed on.''.
       (g) Management Contracts.--Section 12 of the Indian Gaming 
     Regulatory Act (25 U.S.C. 2711) is amended--
       (1) by striking the section heading and all that follows 
     through ``Subject'' in subsection (a)(1) and inserting the 
     following:

     ``SEC. 12. MANAGEMENT CONTRACTS.

       ``(a) Class II Gaming and Class III Gaming Activities; 
     Information on Operators.--
       ``(1) Gaming activities.--Subject''; and
       (2) in subsection (a)(1), by striking ``class II gaming 
     activity that the Indian tribe may engage in under section 
     11(b)(1) of this Act,'' and inserting ``class II gaming 
     activity in which the Indian tribe may engage under section 
     11(b)(1), or a class III gaming activity in which the Indian 
     tribe may engage under section 11(d),''.
       (h) Commission Funding.--Section 18 of the Indian Gaming 
     Regulatory Act (25 U.S.C. 2717) is amended--
       (1) in subsection (a)--
       (A) by striking paragraphs (1) through (3) and inserting 
     the following:
       ``(1) Schedule of fees.--
       ``(A) In general.--Except as provided in this section, the 
     Commission shall establish a schedule of fees to be paid 
     annually to the Commission, on a quarterly basis, by each 
     gaming operation that conducts a class II gaming or class III 
     gaming activity that is regulated, in whole or in part, by 
     this Act.
       ``(B) Rates.--The rate of fees under the schedule 
     established under subparagraph (A) that are imposed on the 
     gross revenues from each operation that conducts a class II 
     gaming or class III gaming activity described in that 
     paragraph shall be (as determined by the Commission)--
       ``(i) a progressive rate structure levied on the gross 
     revenues in excess of $1,500,000 from

[[Page S10655]]

     each operation that conducts a class II gaming or class III 
     gaming activity; or
       ``(ii) a flat fee levied on the gross revenues from each 
     operation that conducts a class II gaming or class III gaming 
     activity.
       ``(C) Total amount.--The total amount of all fees imposed 
     during any fiscal year under the schedule established under 
     subparagraph (A) shall not exceed--
       ``(i) $10,000,000 for each of fiscal years 2004 and 2005;
       ``(ii) $11,000,000 for each of fiscal years 2006 and 2007; 
     and
       ``(iii) $12,000,000 for each of fiscal years 2008 and 
     2009.''; and
       (B) by redesignating paragraphs (4) through (6) as 
     paragraphs (2) through (4), respectively;
       (2) by redesignating subsection (b) as subsection (d);
       (3) in paragraph (2) of subsection (d) (as redesignated by 
     paragraph (2)), by striking ``section 19 of this Act'' and 
     inserting ``section 28''; and
       (4) by inserting after subsection (a) the following:
       ``(b) Fee Procedures.--
       ``(1) In general.--By a vote of not less than 2 members of 
     the Commission, the Commission shall adopt the schedule of 
     fees provided for under this section.
       ``(2) Fees assessed.--In assessing and collecting fees 
     under this section, the Commission shall take into account 
     the duties of, and services provided by, the Commission under 
     this Act.
       ``(3) Regulations.--The Commission shall promulgate such 
     regulations as are necessary to carry out this subsection.
       ``(c) Fee Reduction Program.--
       ``(1) In general.--In making a determination of the amount 
     of fees to be assessed for any class II gaming or class III 
     gaming activity under the schedule of fees under this 
     section, the Commission may provide for a reduction in the 
     amount of fees that otherwise would be collected on the basis 
     of--
       ``(A) the extent and quality of regulation of the gaming 
     activity provided by a State or Indian tribe, or both, in 
     accordance with an approved State-Tribal compact;
       ``(B) the extent and quality of self-regulating activities 
     covered by this Act that are conducted by an Indian tribe; 
     and
       ``(C) other factors determined by the Commission, 
     including--
       ``(i) the unique nature of tribal gaming as compared with 
     commercial gaming, other governmental gaming, and charitable 
     gaming;
       ``(ii) the broad variations in the nature, scale, and size 
     of tribal gaming activity;
       ``(iii) the inherent sovereign rights of Indian tribes with 
     respect to regulating the affairs of Indian tribes;
       ``(iv) the findings and purposes under sections 2 and 3;
       ``(v) the amount of interest or investment income derived 
     from the Indian gaming regulation accounts; and
       ``(vi) any other matter that is consistent with the 
     purposes under section 3.
       ``(2) Rulemaking.--The Commission shall promulgate such 
     regulations as are necessary to carry out this subsection.''.
       (i) Additional Amendments.--The Indian Gaming Regulatory 
     Act is amended--
       (1) by striking section 19 (25 U.S.C. 2718);
       (2) by redesignating sections 20 through 24 (25 U.S.C. 2719 
     through 2723) as sections 23 through 27, respectively;
       (3) by inserting after section 18 (25 U.S.C. 2717) the 
     following:

     ``SEC. 19. INDIAN GAMING REGULATION ACCOUNTS.

       ``(a) In General.--All fees and civil forfeitures collected 
     by the Commission in accordance with this Act shall--
       ``(1) be maintained in separate, segregated accounts; and
       ``(2) be expended only for purposes described in this Act.
       ``(b) Investments.--
       ``(1) In general.--The Commission shall invest such portion 
     of the accounts maintained under subsection (a) as are not, 
     in the judgment of the Commission, required to meet immediate 
     expenses.
       ``(2) Types of investments.--Investments may be made only 
     in interest-bearing obligations of the United States 
     guaranteed as to both principal and interest by the United 
     States.
       ``(c) Sale of Obligations.--Any obligation acquired with 
     funds in an account maintained under subsection (a)(1) 
     (except special obligations issued exclusively to those 
     accounts, which may be redeemed at par plus accrued interest) 
     may be sold by the Commission at the market price.
       ``(d) Credits to Indian Gaming Regulatory Accounts.--The 
     interest on, and proceeds from, the sale or redemption of any 
     obligation held in an account maintained under subsection 
     (a)(1) shall be credited to and form a part of the account.

     ``SEC. 20. MINIMUM STANDARDS.

       ``(a) Class I Gaming.--Notwithstanding any other provision 
     of law, class I gaming on Indian land--
       ``(1) shall remain within the exclusive jurisdiction of the 
     Indian tribe having jurisdiction over the Indian land; and
       ``(2) shall not be subject to this Act.
       ``(b) Class II Gaming.--
       ``(1) In general.--Subject to paragraph (2), an Indian 
     tribe shall retain primary jurisdiction over regulation of 
     class II gaming activities conducted by the Indian tribe.
       ``(2) Conduct of class ii gaming.--Any class II gaming 
     activity shall be conducted in accordance with--
       ``(A) section 11; and
       ``(B) regulations promulgated under subsection (d).
       ``(c) Class III Gaming.--
       ``(1) In general.--Subject to paragraph (2), an Indian 
     tribe shall retain primary jurisdiction over regulation of 
     class III gaming activities conducted by the Indian tribe.
       ``(2) Conduct of class iii gaming.--Any class III gaming 
     operated by an Indian tribe under this Act shall be conducted 
     in accordance with--
       ``(A) section 11; and
       ``(B) regulations promulgated under subsection (d).
       ``(d) Rulemaking.--
       ``(1) In general.--
       ``(A) Promulgation.--Not later than 180 days after the date 
     of enactment of the Indian Gaming Regulatory Act Amendments 
     of 2003, the Commission shall develop procedures under 
     subchapter III of chapter 5 of title 5, United States Code, 
     to negotiate and promulgate regulations relating to--
       ``(i) the monitoring and regulation of tribal gaming;
       ``(ii) the establishment and regulation of internal control 
     systems; and
       ``(iii) the conduct of background investigation.
       ``(B) Publication of proposed regulations.--Not later than 
     1 year after the date of enactment of the Indian Gaming 
     Regulatory Act Amendments of 2003, the Commission shall 
     publish in the Federal Register proposed regulations 
     developed by a negotiated rulemaking committee in accordance 
     with this section.
       ``(2) Committee.--A negotiated rulemaking committee 
     established in accordance with section 565 of title 5, United 
     States Code, to carry out this subsection shall be composed 
     only of Federal and Indian tribal government representatives, 
     a majority of whom shall be nominated by and be 
     representative of Indian tribes that conduct gaming in 
     accordance with this Act.
       ``(e) Elimination of Existing Regulations.--
       ``(1) In general.--Except as provided in paragraph (2), as 
     of the date that is 1 year after the date of enactment of the 
     Indian Gaming Regulatory Act Amendments of 2003, regulations 
     establishing minimum internal control standards promulgated 
     by the Commission that are in effect as of the date of 
     enactment of the Indian Gaming Regulatory Act Amendments of 
     2003 shall have no force or effect.
       ``(2) Exception for affirmation of existing regulations.--
     Notwithstanding paragraph (1), if, before the date of 
     enactment of the Indian Gaming Regulatory Act Amendments of 
     2003, the Commission certifies to the Secretary of the 
     Interior that the Commission has promulgated regulations that 
     establish minimum internal control standards that meet the 
     requirements of subsection (d)(1)(A) and were developed in 
     consultation with affected Indian tribes, the regulations 
     shall--
       ``(A) be considered to satisfy the requirements of 
     paragraph (1); and
       ``(B) remain in full force and effect.

     ``SEC. 21. USE OF NATIONAL INDIAN GAMING COMMISSION CIVIL 
                   FINES.

       ``(a) Account.--Amounts collected by the Commission under 
     section 14 shall--
       ``(1) be deposited in a separate Indian gaming regulation 
     account established under section 19(d)(1)(A); and
       ``(2) be available to the Commission, as provided for in 
     advance in Acts of appropriation, for use in carrying out 
     this Act.
       ``(b) Use of Funds.--
       ``(1) In general.--The Commission may provide grants and 
     technical assistance to Indian tribes using funds secured by 
     the Commission under section 14.
       ``(2) Uses.--A grant or financial assistance provided under 
     paragraph (1) may be used only--
       ``(A) to provide technical training and other assistance to 
     an Indian tribe to strengthen the regulatory integrity of 
     Indian gaming;
       ``(B) to provide assistance to an Indian tribe to assess 
     the feasibility of conducting nongaming economic development 
     activities on Indian land;
       ``(C) to provide assistance to an Indian tribe to devise 
     and implement programs and treatment services for individuals 
     diagnosed as problem gamblers; or
       ``(D) to provide to an Indian tribe 1 or more other forms 
     of assistance that are not inconsistent with this Act.
       ``(c) Source of Funds.--Amounts used to carry out 
     subsection (b) may be derived only from funds--
       ``(1) collected by the Commission under section 14; and
       ``(2) authorized for use in advance by an Act of 
     appropriation.
       ``(d) Regulations.--The Commission may promulgate such 
     regulations as are necessary to carry out this section.

     ``SEC. 22. TRIBAL CONSULTATION.

       ``In carrying out this Act, the Secretary of the Interior, 
     Secretary of the Treasury, and Chairman of the Commission 
     shall involve and consult with Indian tribes to the maximum 
     extent practicable, as appropriate, in a manner that is 
     consistent with the Federal trust and the government-to-
     government relationship that exists between Indian tribes and 
     the Federal Government.''; and
       (4) by inserting after section 27 (as redesignated by 
     paragraph (2)) the following:

[[Page S10656]]

     ``SEC. 28. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) In General.--Subject to section 18, there is 
     authorized to be appropriated to carry out this Act, for 
     fiscal year 1998 and each fiscal year thereafter, an amount 
     equal to the amount of funds derived from the assessments 
     authorized by section 18(a).
       ``(b) Additional Amounts.--Notwithstanding section 18, in 
     addition to amounts authorized to be appropriated by 
     subsection (a), there are authorized to be appropriated 
     $2,000,000 to fund the operation of the Commission for fiscal 
     year 1998 and each fiscal year thereafter.''.
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