Government , Business , Legal

Comanche Nation and Otoe-Missouria Tribe break ranks and sign new state gaming compacts

Photo caption: The Comanche Nation and Otoe-Missouria Tribe signed new gaming compacts with Gov. Kevin Stitt. KTUL Channel 8

OKLAHOMA CITY, Okla. — Two Oklahoma tribes have bowed out of ongoing litigation against Gov. Kevin Stitt and have instead signed new gaming compacts with the state.

Joined by Gov. Stitt at the state Capitol, leaders with the Comanche Nation and Otoe-Missouria Tribe signed new compacts on April 21.

However, within hours, the compact’s legality was called into question by Oklahoma Attorney General Mike Hunter due to some additions that were not in previous compacts.

“The agreements signed today between the governor, the Otoe-Missouria Tribe and the Comanche Nation are not authorized by the state Tribal Gaming Act, Title 3A, Section 261 et. sec. The governor has the authority to negotiate compacts with the tribes on behalf of the state. However, only gaming activities authorized by the act may be the subject of a tribal gaming compact. Sports betting is not a prescribed ‘covered game’ under the act.”

Under the terms of the new agreements, each tribe will be allowed to have sports betting at two brick and mortar locations and offers a framework for mobile e-sports gambling. That revenue would be subject to an additional 1.1 percent fee and any sports betting vendors brought on board by either tribe, such as DraftKings or Fan Duel, would be subject to approval by the state first.

Books at either tribe’s casinos would not be allowed to accept wagers on intercollegiate games involving Oklahoma teams or on college athletic events staged within the state, such as the Women’s College World Series.

Sports betting is currently illegal in Oklahoma. During the post-signing press conference, Gov. Stitt said since they are included in the list of covered games in the compact, there was no need for the legislature to take any action. However, during the 2018 state-wide teacher walk-out, the legislature had to vote to expand the compacts to allow non-house banked craps and roulette.

“There are more than 50 compacts and not all of them are ratified by the legislature,” Stitt said.

“The governor negotiates gaming compacts. The governor negotiates gas compacts and tobacco compacts. That’s in the governor’s purview to do. Sports books are under the covered games, so we don’t think there’s a need for the legislature to vote on that.”

The terms call for both tribes to pay an exclusivity fee starting at 4.5 percent on revenue generated by Class III games at their existing casinos. If additional casinos are opened, then the exclusivity fee increases to 6 percent. That is on top of the annual oversight fee ranging from $25,000 to $250,000, depending on how much revenue is generated.

Although the tribes will not be required to pay any fees on Class II games, they would be required to have at least 45 percent of their electronic games be considered Class III machines.

The new gaming compacts remove restrictions on house-banked table and card games. If the compacts are approved by the Department of Interior, people who play table games at Otoe-Missouria and Comanche casinos would no longer have to ante each hand.

Additionally, the new compacts also include the governor’s endorsement for each tribe to open up new facilities in specific counties that are outside of their jurisdictional area. Section 20 of the Indian Gaming Regulatory Act includes provisions for tribes to take land into trust outside of their jurisdictional area if certain conditions are met, including approval from state officials.

Among the specific exemptions for Oklahoma tribes in that section is documentation that the land is either within the tribe’s historical boundaries or is contiguous to land already in trust for that tribe.

As written, the Comanche Nation’s compact allows for one new facility each in Grady, Cleveland and Love counties, while the Otoe-Missouria’s compact would allow for one new casino each in Logan, Payne and Noble counties.

Payne County is currently home to two tribal casinos: one operated by the Pawnee Nation near Yale and one operated by the Iowa Tribe in Perkins. The Iowa Tribe also operates the only casino in Logan County, a 40-slot facility in Coyle.

Headquartered in Red Rock, the Otoe-Missouria Tribe already operates casinos in Noble County in Perry and Red Rock.

The Comanche Nation’s attorney, Robert Rosette, indicated in an emailed statement that the Lawton-based tribe is specifically looking at adding casinos near Will Rogers International Airport in far southwestern Oklahoma City, Chickasha’s I-44 corridor and along the I-35 corridor near the Red River.

In exchange for the governor’s explicit approval for additional sites, the tribes will pay a higher exclusivity fee for revenue generated by the new casinos should their land into trust applications be approved. Those fees range from 8 to 13 percent.

Until April 21, both tribes were parties to a lawsuit filed in the Western District of Oklahoma over the status of the state’s model tribal gaming compact used by more than 30 tribes. The lawsuit is still pending and a gag order is still in place for the remaining participants.

“Both of these tribes in these negotiations did not take any positions against those expressed in federal court,” Rosette said. “They stood with the other tribes that the compacts automatically renewed. They just decided that these new compacts were better than the old one. We could stay in federal court and win, but not have compact that’s as nearly as good as the ones they were able to negotiate in good faith with Gov. Stitt.”