[Federal Register Volume 87, Number 67 (Thursday, April 7, 2022)]
[Proposed Rules]
[Pages 20351-20354]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-06617]


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 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / 
Proposed Rules  

[[Page 20351]]


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DEPARTMENT OF THE INTERIOR

National Indian Gaming Commission

25 CFR Part 518

RIN 3141-AA72


Self-Regulation of Class II Gaming

AGENCY: National Indian Gaming Commission.

ACTION: Proposed rule.

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SUMMARY: The National Indian Gaming Commission (NIGC) proposes to amend 
its regulations regarding self-regulation of Class II gaming under the 
Indian Gaming Regulatory Act. The proposed rule will amend the 
regulations to address an ambiguity in the petitioning process and 
clarify and expand the Office of Self-Regulation's (OSR) role once the 
Commission issues a certificate. Notably, the proposed rule: Clarifies 
the NIGC may issue a final decision on issuing a certificate within 30 
days instead of after 30 days; enumerates the OSR is the correct party 
to receive notifications of material changes from self-regulated 
tribes; clarifies the OSR will be the proponent of any case to revoke a 
certificate of self-regulation before the Commission; enables the OSR 
to obtain information from a self-regulated tribe; and clarifies that, 
in any revocation proceeding, the OSR has the burden to show just cause 
for the revocation and carry that burden by a preponderance of the 
evidence.

DATES: The agency must receive comments on or before June 6, 2022.

ADDRESSES: You may send comments by any of the following methods:
     Federal eRulemaking Portal: Go to https://www.regulations.gov. Follow the instructions for submitting comments.
     Email: [email protected].
     Fax: (202) 632-7066.
     Mail: National Indian Gaming Commission, 1849 C Street NW, 
MS 1621, Washington, DC 20240.
     Hand Delivery: National Indian Gaming Commission, 90 K 
Street NE, Suite 200, Washington, DC 20002, between 9 a.m. and 5 p.m., 
Monday through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT: James A. Lewis, National Indian Gaming 
Commission; Telephone: (202) 632-7003.

SUPPLEMENTARY INFORMATION:

I. Comments Invited

    Interested parties are invited to participate in this proposed 
rulemaking by submitting such written data, views, or arguments as they 
may desire. Comments providing the factual basis behind supporting the 
views and suggestions presented are particularly helpful in developing 
reasoned regulatory decisions on the proposal.

II. Background

    The Indian Gaming Regulatory Act (IGRA or Act), Public Law 100-497, 
25 U.S.C. 2701 et seq., was signed into law on October 17, 1988. The 
Act establishes the National Indian Gaming Commission (NIGC or 
Commission) and sets out a comprehensive framework for the regulation 
of gaming on Indian lands.
    On January 31, 2012, the Commission published a notice of proposed 
rulemaking to promulgate part 518, the procedures controlling self-
regulation. 77 FR 4714 (Jan. 31, 2012). Once promulgated, part 518 
established the procedures for the Commission and the OSR to, among 
other things, receive, evaluate, recommend, issue, deny, or revoke a 
certificate of self-regulation.
    On September 1, 2013, after initial publication, the Commission 
enacted minor revisions to part 518 to amend certain timelines and an 
incorrect section heading and reference to IGRA. 78 FR 37114 (Sept. 1, 
2013).

III. Development of the Proposed Rule

    On June 9, 2021, the National Indian Gaming Commission sent a 
Notice of Consultation announcing that the Agency intended to consult 
on several topics, including proposed changes to the procedures 
controlling self-regulation. Prior to consultation, the Commission 
released proposed discussion drafts of the regulations for review. The 
proposed amendments to the procedures controlling self-regulation are 
intended to improve the Agency's efficiency in evaluating petitions for 
self-regulation, reduce the time it takes to obtain a certificate of 
self-regulation and clarify the Office of Self-Regulation's functions. 
The Commission held two virtual consultation sessions in September and 
one virtual consultation in October of 2021 to receive tribal input on 
any proposed changes.
    The Commission reviewed all comments received through consultation 
and now proposes these changes, which it believes will improve the 
procedures for self-regulation.

IV. Regulatory Matters

Regulatory Flexibility Act

    The proposed rule will not have a significant impact on a 
substantial number of small entities as defined under the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq. Moreover, Indian tribes are not 
considered to be small entities for the purposes of the Regulatory 
Flexibility Act.

Small Business Regulatory Enforcement Fairness Act

    The proposed rule is not a major rule under 5 U.S.C. 804(2), the 
Small Business Regulatory Enforcement Fairness Act. The rule does not 
have an effect on the economy of $100 million or more. The rule will 
not cause a major increase in costs or prices for consumers, individual 
industries, Federal, State, local government agencies or geographic 
regions. Nor will the proposed rule have a significant adverse effect 
on competition, employment, investment, productivity, innovation, or 
the ability of the enterprises, to compete with foreign based 
enterprises.

Unfunded Mandate Reform Act

    The Commission, as an independent regulatory agency, is exempt from 
compliance with the Unfunded Mandates Reform Act, 2 U.S.C. 1502(1); 2 
U.S.C. 658(1).

Takings

    In accordance with Executive Order 12630, the Commission has 
determined that the proposed rule does not have significant takings 
implications. A takings implication assessment is not required.

Civil Justice Reform

    In accordance with Executive Order 12988, the Commission has 
determined that the proposed rule does not unduly

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burden the judicial system and meets the requirements of section 3(a) 
and 3(b)(2) of the order.

National Environmental Policy Act

    The Commission has determined that the 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, 42 U.S.C. 
4321, et seq.

Paperwork Reduction Act

    The information collection requirements contained in this rule were 
previously approved by the Office of Management and Budget (OMB) as 
required by 44 U.S.C. 3501 et seq. and assigned OMB Control Number 
3141-0003.

Tribal Consultation

    The National Indian Gaming Commission is committed to fulfilling 
its tribal consultation obligations--whether directed by statute or 
administrative action such as Executive Order (E.O.) 13175 
(Consultation and Coordination with Indian Tribal Governments)--by 
adhering to the consultation framework described in its Consultation 
Policy published July 15, 2013. The NIGC's consultation policy 
specifies that it will consult with tribes on Commission Action with 
Tribal Implications, which is defined as: Any Commission regulation, 
rulemaking, policy, guidance, legislative proposal, or operational 
activity that may have a substantial direct effect on an Indian tribe 
on matters including, but not limited to the ability of an Indian tribe 
to regulate its Indian gaming; an Indian tribe's formal relationship 
with the Commission; or the consideration of the Commission's trust 
responsibilities to Indian tribes.
    Pursuant to this policy, on June 9, 2021, the National Indian 
Gaming Commission sent a Notice of Consultation to the public, 
announcing the Agency intended to consult on several topics, including 
proposed changes to the procedures for self-regulation. The Commission 
held two virtual consultation sessions in September and one virtual 
consultation session in October of 2021 to receive tribal input on 
proposed changes.

List of Subjects in 25 CFR Part 518

    Gambling, Indian--lands, Indian--tribal government, Reporting and 
recordkeeping requirements.

    Therefore, for reasons stated in the preamble, 25 CFR part 518 is 
proposed to be amended as follows:

PART 518--SELF-REGULATION OF CLASS II GAMING

0
1. The authority citation for part 518 is amended to read as follows:

    Authority: 25 U.S.C. 2706(b)(10); 25 U.S.C. 2710(c).

0
2. Revise Sec. Sec.  518.1 through 518.7 to read as follows:
Sec.
518.1 What does this part cover?
518.2 Who will administer the self-regulation program for the 
Commission?
518.3 Who is eligible to petition for a certificate of self-
regulation?
518.4 What must a tribe submit to the Commission as part of its 
petition?
518.5 What criteria must a tribe meet to receive a certificate of 
self-regulation?
518.6 What are the responsibilities of the Office of Self-Regulation 
in the certification process?
518.7 What process will the Commission use to review and certify 
petitions?
* * * * *


Sec.  518.1  What does this part cover?

    This part sets forth requirements for obtaining a certificate of 
self-regulation of Class II gaming operations under 25 U.S.C. 2710(c). 
When the Commission issues a certificate of self-regulation, the 
certificate is issued to the tribe, not to a particular gaming 
operation. The certificate applies to all Class II gaming activity 
conducted by the tribe holding the certificate.


Sec.  518.2  Who will administer the self-regulation program for the 
Commission?

    The self-regulation program will be administered by the Office of 
Self-Regulation. The Chair shall appoint a Director to administer the 
Office of Self-Regulation.


Sec.  518.3  Who is eligible to petition for a certificate of self-
regulation?

    A tribe is eligible to petition the Commission for a certificate of 
self-regulation of Class II gaming if, for a three (3)-year period 
immediately preceding the date of its petition:
    (a) The tribe has continuously conducted such gaming;
    (b) All gaming that the tribe has engaged in, or has licensed and 
regulated, on Indian lands within the tribe's jurisdiction, is located 
within a State that permits such gaming for any purpose by any person, 
organization or entity (and such gaming is not otherwise specifically 
prohibited on Indian lands by Federal law), in accordance with 25 
U.S.C. 2710(b)(1)(A);
    (c) The governing body of the tribe has adopted an ordinance or 
resolution that the Chair has approved, in accordance with 25 U.S.C. 
2710(b)(1)(B);
    (d) The tribe has otherwise complied with the provisions of 25 
U.S.C. 2710; and
    (e) The gaming operation and the tribal regulatory body have, for 
the three (3) years immediately preceding the date of the petition, 
maintained all records required to support the petition for self-
regulation.


Sec.  518.4  What must a tribe submit to the Commission as part of its 
petition?

    A petition for a certificate of self-regulation is complete under 
this part when it contains:
    (a) Two copies on 8\1/2\'' x 11'' paper of a petition for self-
regulation approved by the governing body of the tribe and certified as 
authentic by an authorized tribal official;
    (b) A description of how the tribe meets the eligibility criteria 
in Sec.  518.3, which may include supporting documentation; and
    (c) The following information with supporting documentation:
    (1) A brief history of each gaming operation(s), including the 
opening dates and periods of voluntary or involuntary closure;
    (2) An organizational chart of the tribal regulatory body;
    (3) A brief description of the criteria tribal regulators must meet 
before being eligible for employment as a tribal regulator;
    (4) A brief description of the process by which the tribal 
regulatory body is funded, and the funding level for the three years 
immediately preceding the date of the petition;
    (5) A list of the current regulators and employees of the tribal 
regulatory body, their complete resumes, their titles, the dates they 
began employment, and, if serving limited terms, the expiration date of 
such terms;
    (6) A brief description of the accounting system(s) at the gaming 
operation which tracks the flow of the gaming revenues;
    (7) A list of gaming activity internal controls at the gaming 
operation(s);
    (8) A description of the record keeping system(s) for all 
investigations, enforcement actions, and prosecutions of violations of 
the tribal gaming ordinance or regulations, for the three (3)-year 
period immediately preceding the date of the petition; and
    (9) The tribe's current set of gaming regulations, if not included 
in the approved tribal gaming ordinance.


Sec.  518.5  What criteria must a tribe meet to receive a certificate 
of self-regulation?

    (a) The Commission shall issue a certificate of self-regulation if 
it determines that for a three (3)-year period, the tribe has:

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    (1) Conducted its gaming activity in a manner that:
    (i) Has resulted in an effective and honest accounting of all 
revenues;
    (ii) Has resulted in a reputation for safe, fair, and honest 
operation of the activity; and
    (iii) Has been generally free of evidence of criminal or dishonest 
activity;
    (2) Conducted its gaming operation on a fiscally and economically 
sound basis;
    (3) Conducted its gaming activity in compliance with the Indian 
Gaming Regulatory Act (IGRA), Commission regulations in this chapter, 
and the tribe's gaming ordinance and gaming regulations; and
    (4) Adopted and is implementing adequate systems for:
    (i) Accounting of all revenues from the gaming activity;
    (ii) Investigating, licensing and monitoring of all employees of 
the gaming activity;
    (iii) Investigating, enforcing, prosecuting, or referring for 
prosecution violations of its gaming ordinance and regulations; and
    (iv) Prosecuting criminal or dishonest activity or referring such 
activity for prosecution.
    (b) A tribe may illustrate that it has met the criteria listed in 
paragraph (a) of this section by addressing factors such as those 
listed in paragraphs (b)(1) through (9) of this section. The list of 
factors is not all-inclusive; other factors not listed here may also be 
addressed and considered.
    (1) The tribe adopted and is implementing minimum internal control 
standards which are at least as stringent as those promulgated by the 
Commission;
    (2) The tribe requires tribal gaming regulators to meet the same 
suitability requirements as those required for key employees and 
primary management officials of the gaming operation(s);
    (3) The tribe's gaming operation utilizes an adequate system for 
accounting of all gaming revenues from Class II gaming activity;
    (4) The tribe has a dispute resolution process for gaming operation 
customers and has taken steps to ensure that the process is adequately 
implemented;
    (5) The tribe has a gaming regulatory body which:
    (i) Monitors gaming activities to ensure compliance with Federal 
and tribal laws and regulations;
    (ii) Monitors the gaming revenues accounting system for continued 
effectiveness;
    (iii) Performs routine operational or other audits of the Class II 
gaming activities;
    (iv) Routinely receives and reviews gaming revenue accounting 
information from the gaming operation(s);
    (v) Has access to, and may inspect, examine, photocopy and audit, 
all papers, books, and records of the gaming operation(s) and Class II 
gaming activities;
    (vi) Monitors compliance with minimum internal control standards 
for the gaming operation;
    (vii) Has adopted and is implementing an adequate system for 
investigating, licensing, and monitoring of all employees of the gaming 
activity;
    (viii) Maintains records on licensees and on persons denied 
licenses, including persons otherwise prohibited from engaging in 
gaming activities within the tribe's jurisdiction;
    (ix) Establishes standards for, and issues, vendor licenses or 
permits to persons or entities who deal with the gaming operation, such 
as manufacturers and suppliers of services, equipment and supplies;
    (x) Establishes or approves the rules governing Class II games, and 
requires their posting;
    (xi) Has adopted and is implementing an adequate system for the 
investigation of possible violations of the tribal gaming ordinance and 
regulations, and takes appropriate enforcement actions; and
    (xii) Takes testimony and conducts hearings on regulatory matters, 
including matters related to the revocation of primary management 
officials, key employee and vendor licenses;
    (6) The tribe allocates and appropriates a sufficient source of 
permanent and stable funding for the tribal regulatory body;
    (7) The tribe has adopted and is implementing a conflict of 
interest policy for the regulators/regulatory body and their staff;
    (8) The tribe has adopted and is implementing a system for adequate 
prosecution of violations of the tribal gaming ordinance and 
regulations or referrals for prosecution; and
    (9) The tribe demonstrates that the operation is being conducted in 
a manner which adequately protects the environment and the public 
health and safety.
    (c) The tribe assists the Commission with access and information-
gathering responsibilities during the certification process.
    (d) The burden of establishing self-regulation is upon the tribe 
filing the petition.


Sec.  518.6  What are the responsibilities of the Office of Self-
Regulation in the certification process?

    The Office of Self-Regulation shall be responsible for directing 
and coordinating the certification process. It shall provide a written 
report and recommendation to the Commission as to whether a certificate 
of self-regulation should be issued or denied, and a copy of the report 
and recommendation to the petitioning tribe.


Sec.  518.7  What process will the Commission use to review and certify 
petitions?

    (a) Petitions for self-regulation shall be submitted by tribes to 
the Office of Self-Regulation.
    (1) Within 30 days of receipt of a tribe s petition, the Office of 
Self-Regulation shall conduct a review of the tribe's petition to 
determine whether it is complete under Sec.  518.4.
    (2) If the tribe's petition is incomplete, the Office of Self-
Regulation shall notify the tribe by letter, certified mail or return 
receipt requested, of any obvious deficiencies or significant omissions 
in the petition. A tribe with an incomplete petition may submit 
additional information and/or clarification within 30 days of receipt 
of notice of an incomplete petition.
    (3) If the tribe's petition is complete, the Office of Self-
Regulation shall notify the tribe in writing.
    (b) Once a tribe's petition is complete, the Office of Self-
Regulation shall conduct a review to determine whether the tribe meets 
the eligibility criteria in Sec.  518.3 and the approval criteria in 
Sec.  518.5. During its review, the Office of Self-Regulation:
    (1) May request from the tribe any additional material it deems 
necessary to assess whether the tribe has met the criteria for self-
regulation.
    (2) Will coordinate an on-site review and verification of the 
information submitted by the petitioning tribe.
    (c) Within 120 days of notice of a complete petition under Sec.  
518.4, the Office of Self-Regulation shall provide a recommendation and 
written report to the full Commission and the petitioning tribe.
    (1) If the Office of Self-Regulation determines that the tribe has 
satisfied the criteria for a certificate of self-regulation, it shall 
recommend to the Commission that a certificate be issued to the tribe.
    (2) If the Office of Self-Regulation determines that the tribe has 
not met the criteria for a certificate of self-regulation, it shall 
recommend to the Commission that it not issue a certificate to the 
tribe.
    (3) The Office of Self-Regulation shall make all information, on 
which it relies

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in making its recommendation and report, available to the tribe, 
subject to the confidentiality requirements in 25 U.S.C. 2716(a), and 
shall afford the tribe an opportunity to respond.
    (4) The report shall include:
    (i) Findings as to whether each of the eligibility criteria is met, 
and a summary of the basis for each finding;
    (ii) Findings as to whether each of the approval criteria is met, 
and a summary of the basis for each finding;
    (iii) A recommendation to the Commission as to whether it should 
issue the tribe a certificate of self-regulation; and
    (iv) A list of any documents and other information received in 
support of the tribe's petition.
    (5) A tribe shall have 30 days from the date of issuance of the 
report to submit to the Office of Self-Regulation a response to the 
report.
    (d) After receiving the Office of Self-Regulation's recommendation 
and report, and a tribe's response to the report, the Commission shall 
issue preliminary findings as to whether the eligibility and approval 
criteria are met. The Commission's preliminary findings will be 
provided to the tribe within 45 days of receipt of the report.
    (e) Upon receipt of the Commission's preliminary findings, the 
tribe can request, in writing, a hearing before the Commission, as set 
forth in Sec.  518.8. Hearing requests shall be made to the Office of 
Self-Regulation and shall specify the issues to be addressed by the 
tribe at the hearing and any proposed oral or written testimony the 
tribe wishes to present.
    (f) The Commission shall issue a final determination within 30 days 
after issuance of its preliminary findings if the tribe has informed 
the Commission in writing that the tribe does not request a hearing or 
within 30 days after the conclusion of a hearing, if one is held. The 
decision of the Commission to approve or deny a petition shall be a 
final agency action.
    (g) A tribe may withdraw its petition and resubmit it at any time 
prior to the issuance of the Commission's final determination.
0
3. Revise Sec.  518.11 to read as follows:


Sec.  518.11  Does a tribe that holds a certificate of self-regulation 
have a continuing duty to advise the Commission of any additional 
information?

    Yes. A tribe that holds a certificate of self-regulation has a 
continuing duty to advise the Office of Self-Regulation within ten 
business days of any changes in circumstances that are material to the 
approval criteria in Sec.  518.5 and may reasonably cause the 
Commission to review and revoke the tribe's certificate of self-
regulation. Failure to do so is grounds for revocation of a certificate 
of self-regulation.
0
4. Revise Sec. Sec.  518.13 and 518.14 to read as follows:


Sec.  518.13  When may the Commission revoke a certificate of self-
regulation?

    If the Office of Self-Regulation determines that the tribe no 
longer meets or did not comply with the eligibility criteria of Sec.  
518.3, the approval criteria of Sec.  518.5, the requirements of Sec.  
518.10, or the requirements of Sec.  518.11, the Office of Self-
Regulation shall prepare a written recommendation to the Commission and 
deliver a copy of the recommendation to the tribe. The Office of Self-
Regulation's recommendation shall state the reasons for the 
recommendation and shall advise the tribe of its right to a hearing 
under part 584 of this chapter or right to appeal under part 585 of 
this chapter. The Commission may, after an opportunity for a hearing, 
revoke a certificate of self-regulation by a majority vote of its 
members if it determines that the tribe no longer meets or did not 
comply with the eligibility criteria of Sec.  518.3, the approval 
criteria of Sec.  518.5, the requirements of Sec.  518.10, or the 
requirements of Sec.  518.11.


Sec.  518.14  May a tribe request a hearing on the Commission's 
proposal to revoke its certificate of self-regulation?

    Yes. A tribe may request a hearing regarding the Office of Self-
Regulation's recommendation that the Commission revoke a certificate of 
self-regulation. Such a request shall be filed with the Commission 
pursuant to part 584 of this chapter. Failure to request a hearing 
within the time provided by part 584 of this chapter shall constitute a 
waiver of the right to a hearing. At any hearing where the Commission 
considers revoking a certificate, the Office of Self-Regulation bears 
the burden of proof to support its recommendation by a preponderance of 
the evidence. The decision to revoke a certificate is a final agency 
action and is appealable to Federal District Court pursuant to 25 
U.S.C. 2714.

    Date: March 24, 2022.
E. Sequoyah Simermeyer,
Chairman.
Jeannie Hovland,
Vice Chair.
[FR Doc. 2022-06617 Filed 4-6-22; 8:45 am]
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