WASHINGTON — The revenue from American Indian gaming enterprises in Minnesota has grown steadily, peaking last year at $1.6 billion.
Minnesota’s 11 federally recognized tribes have all come to depend on the money gamblers lose or spend otherwise at their 19 casinos. But some tribes make a lot of money from gaming, enough to give healthy payouts to tribal members and pay for the college tuition of their young people, while other tribes are raising significantly less money from their enterprises.
“It funds our government, it makes us self-sufficient,” said Shelley Buck, tribal council vice president for the Prairie Island Indian Community, a Dakota tribe.
Buck is proud that the tribe’s Treasure Island Resort and Casino, located about 36 miles south of the Twin Cities, can book some of the biggest names in show business, including Carrie Underwood and Santana. She’s also proud that tribal enterprises, which include the second-largest hotel in the state and a golf course, employs between 1,500 and 1,700 people.
“We are an economic engine in rural areas,” Buck said of tribal gaming.
But it wasn’t always this way for the small tribe of only about 1,100 enrolled members.
Its economic revival began in 1984 when the tribe opened Treasure Island Bingo. A few years later, Congress passed the Indian Gaming Regulatory Act, (IGRA) that established – and regulated – gambling on tribal lands. According to IGRA, money made in the casinos can only be used for certain purposes, including the running of tribal government and services, payouts to tribal members and donations to charitable organizations.
The Prairie Island Indian Community and other Minnesota tribes were among the first to sign compacts, or agreements with the state government, required under IGRA if a tribe wanted to offer table games and slots and certain other types of gambling.
Buck said she was told a story about former Minnesota Gov. Rudy Perpich, who signed most of the Minnesota’s tribal gaming compacts. She said Perpich pushed a signed agreement across the table and told tribal officials “Good luck getting anyone to come to the reservation.”
Perpich was wrong to be a skeptic, especially when it comes to tribal casinos like Treasure Island and other that are closest to the Twin Cities.
“We probably have the best compacts in the nation,” said Buck of the contracts Minnesota tribes have signed with the state. The reason, Buck said, is that the compacts don’t “sunset,” or have an end date, and they don’t require tribes to share any revenues with the state.
‘The richest tribe in history’
The Prairie Island community uses gaming revenues to run its government and provide health and elder care, other social services and education. Tribal members who maintain at least a “C” average in school are eligible for free college tuition, a benefit that helped Buck pay for her two master’s degrees, one in sports management and the other in federal Indian law.
Tribal members also receive per capita payments, known as “per caps” from the profits from its casino and other enterprises. Buck declined to say how much those payments are for, or how much in revenues gaming has generated.
But through a Freedom of Information Act request to the National Indian Gaming Commission (NIGC,) a federal agency that receives annual reports from each tribe on gaming revenues, MinnPost discovered that gaming in the state grew modestly from about $1.48 billion in 2012, to $1.55 billion in 2019. It recovered from a downturn during the coronavirus pandemic to nearly $1.6 billion last year.
Saying it is privileged commercial information, NIGC failed to provide the amount of gambling revenues earned by each Minnesota tribe.
The tribe with the state’s largest gaming operations, the Shakopee Mdewakanton Sioux Community, declined requests for interviews and failed to respond to questions about the economic impact of its casinos, offering only a statement.
“The Shakopee Mdewakanton Sioux Community, as a federally recognized tribe, provides essential services to its members,” the tribe’s statement said. “It is also one of the largest financial contributors to tribes in Minnesota and across the country. The SMSC, like many other tribes, does not share its financial information publicly.”
However, the tribe is not shy about its charitable donations. It says on its website that it has donated more than $370 million to organizations and causes and provided other tribes with about $500 million in economic development loans.
The tribe did open up to a New York Times reporter in 2012. He wrote that the Shakopee Mdewakanton “are believed to be the richest tribe in American history as measured by individual personal wealth.”
The story said that each adult, according to court records in a divorce case and a tribal member, received a monthly payment of around $84,000, or $1.08 million a year in 2012. And the tribe’s revenue from gaming at its Mystic Lake Casino Hotel, Little Six Casino, and from its other enterprises is believed to have increased since then.
Like the Prairie Island tribe, the Shakopee Mdewakanton has few members, 779 as of the 2020 U.S. Census.
Other Minnesota tribes have many more enrolled members and much more modest gaming operation and revenues.
“(Gaming) has been great for some tribes, but not all of them,” Buck said.
Location, location, location
The tribes whose reservations are in the north of the state, or otherwise farther away from the Twin Cities, are as dependent on gaming revenues as the wealthier tribes, even though they receive far less gambling money.
And while some tribes, including the Mille Lacs Band of Ojibwe, provide regular “per caps” others, including the White Earth Nation do not.
“Many tribal members are living on less than $5,000 a year,” said Dale Greene, who has worked for the Leech Lake Band’s legal department and is an Ojibwe elder and cultural specialist.
Michelle Paquin, tribal legal adviser to the Red Lake Band of Chippewa Indians, said gaming is just one “revenue stream” along with fishing and logging, that helps fund tribal services. She said visitors to the tribe’s gaming operations “tend to be vacationers,” not steady customers like those who visit the casinos nearer the Twin Cities on a repeated, regular basis.
“We don’t have a base to draw from,” Paquin said.
Instead of giving tribal members “per caps” the gambling money is used for social services for members of her 10,000-member tribe.
“We siphon off the profits to fund our public services,” Paquin said.
Robert Deschamps, chairman of the Grand Portage Band of Lake Superior Chippewa, said his tribe’s gaming operations provide the largest employment in rural Cook County.
But he said the tribe’s gaming revenues are still down about 25% from pre-pandemic levels, a result of the closure of the Canadian border which locked out a lot of the casino’s customers.
Deschamps said gaming revenues support nearly all tribal ventures, including an elder center, schools and water and waste services.
He said the federal government’s trust obligations – a requirement to provide services required to protect and enhance tribal lands, resources, and self-government, as well as raise the standard of living and social well-being of the Indian people – only provides about 37 cents on the dollar when it comes to tribal expenditures.
The biggest downside to American Indian tribes of the federal government’s trust obligation is that it gave Congress the authority to place tribal land and other property under the control of federal agencies to the extent that virtually everything a tribe may wish to do with its land must be approved by the federal government.
Looking for more gaming revenues
Despite the dip in his tribe’s gaming revenues, Deschamps said the American Indian gaming industry is “absolutely and economic driver for the state.” While the state cannot tax gaming revenues, casinos provide jobs that generate payroll taxes and purchase goods and services from vendors that also pay state taxes.
According to the National Indian Gaming Commission, revenues from the nation’s gaming tribes have risen steadily, from $14.7 billion in 2012 to $40.9 billion in 2022, eclipsing the take of commercial casinos.
But there is increased competition for gambling dollars, especially from internet gambling and sports betting. According to the American Gaming Association, the growth in total gaming revenue this year was fueled by online gaming – especially online sports betting – while land-based gaming was relatively flat.
Minnesota’s tribes are eager to benefit from the growing online sports betting business. But an attempt at reaching a compromise that would give tribes near exclusivity on sports betting failed this year when state legislators and the Minnesota Indian Gaming Association could not come to terms over a sports betting compact.
Deschamps said the state’s tribes are not giving up. “We are working on it with the state,” he said.
Yet some are concerned about the economic dependence Minnesota tribes have on gambling. And Greene said Native Americans should consider the moral consequences of gaming.
“We’ve had compulsive addiction pressed upon us,” he said of historical efforts to “pacify” Native Americans with liquor and drugs like laudanum. “I would think we would have a better moral and ethical viewpoint of compulsive addiction.”
Yet Greene said gaming had provided some benefit to the reservations.
“At least we are getting something for the loss or our land and resources,” he said.