Legislature(2003 - 2004)
04/21/2004 01:53 PM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 552
An Act relating to gambling and gaming.
Co-Chair Harris MOVED to ADOPT Committee Substitute Work
Draft Version I dated 4-20-04 as the version of legislation
before the Committee. There being NO OBJECTION, it was so
ordered.
TOM WRIGHT, STAFF TO REPRESENTATIVE HARRIS, explained the
differences between the original bill and Work Draft Version
I.
Mr. Wright stated that Version I deleted the following:
- all references to the Alaska Gaming Commission and
its supervision of charitable gaming found in, or
related to, AS 05.15;
- Section 2 from the original bill that gave authority
to the Alaska Gaming Commission to suspend a license or
permit for a violation of AS 05.15;
- Section 3 from the original bill that gave authority
to the Alaska Gaming Commission to administer the
provisions of AS 05.15;
- Section 4 from the original bill that provided a
definition of the Alaska Gaming Commission under AS
05.15.
Mr. Wright stated that Work Draft Version I also made the
following changes:
- on page 2, line 21,provided a definition of a public
officer of the State and gave it the same definition
found in AS 39.52.960;
- on page 3, line 2, further defined the grounds for
removal of a commissioner. This includes the failure
of a commissioner to attend at least 50% of the
meetings in any 12-month period;
- on page 5, line 27, provided an appeals process which
allows a person to seek judicial review of a final
administrative order of the commission as defined in AS
44.62.560 and 44.62.570 (judicial review under the
Administrative Procedures Act);
Mr. Wright continued explaining that Version I also:
- deleted subsection 10 on page 10 of the original bill
that required a person applying for an owner's or
supplier's license to provide information of the
amount, date and method of payment of political
contributions, loans, donations or other payments to a
candidate or office holder for the previous five years
before the date the person applied for a license;
- on page 11, line 13, added subsection (i). Requires
an applicant for a license to submit to the commission,
fingerprints and fees required by the Department of
Public Safety for criminal justice information and a
national criminal history record check. The commission
is then required to forward fingerprints and fees to
the department for a report of criminal justice
information under AS 12.62 (Criminal Justice
Information Systems Security and Privacy) and a
national criminal history record check. The results
will be used to then evaluate applicants.
Mr. Wright emphasized that the change adding subsection (i)
must be included for the department to get permission to
request this information.
Mr. Wright noted the following changes in Version I:
- on page 16, line 5, clarified language that any
income earned on the principal of a cash or negotiated
securities bond will be paid to the benefit of the
licensee;
- on page 16, line 25, rewrote subsection (h) for
clarity purposes;
- on page 30, line 22, added security and surveillance
services and supplies and money counting services and
supplies to the definition of supplier's license; and
- deleted Sections 10 and 11 from the original bill.
Section 10 repealed the definition of department
(Department of Revenue) since the commission was to
provide supervision of charitable gaming activities.
Section 11 instructed the revisor to change references
to the commissioner and department in AS 05.15 to
commission.
Representative Stoltze asked if he had looked into the
ramifications of the Indian gaming issues. Mr. Wright said
that he was in contact with the Department of Law, and the
request is under review. Mr. Barnhill could address it.
Representative Stoltze asked if it is the intent to have a
sole source contract, and whether there is expertise on
Indian gaming within the Department of Law and Legislative
Legal Services. Mr. Wright deferred to Mr. Barnhill.
Co-Chair Harris concurred with Representative Stoltze's
concerns. He thought that there might be a lack of
expertise in that area because gaming is not a major part of
Alaska's economy.
MIKE BARNHILL, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF LAW
(DOL), agreed that Representative Stoltze's concerns are
valid. As with any unclear issue of law, the decision falls
to the courts. While the DOL can provide its best analysis
and evaluation of legal questions, it cannot predict with
certainty what a court would decide. Mr. Barnhill said that
he and experts in Indian gaming and law discuss these
issues.
Representative Stoltze asked if it should be a legitimate
concern of the policymakers on this Committee that with
passage of the bill, the sole source contract in Anchorage
could provide a legal remedy for Native gaming in other
communities and other sites in Anchorage. Mr. Barnhill
replied that passage of the bill would allow Indian gaming.
Representative Joule asked if the State has a concern that
Indian gaming could result from this bill. Mr. Barnhill said
that the DOL declines to express views on policy issues. He
was unaware of the Department having a concern.
Representative Croft asked if it would be possible to get a
ruling or declaratory judgment on the status of the tribes
and their lands. Mr. Barnhill had spoken with the
Solicitor's Office in the Department of the Interior and he
noted that most of the requests for declaration of Indian
land were turned down. Indian lands may have a different set
of facts pertinent to the regulation of each particular
parcel. He doubted the possibility of getting a declaratory
judgment because it's on a case-by-case basis. Only a few of
the seven or more Alaskan cases before the National Indian
Gaming Commission (NIGC) succeeded in obtaining a decision
of being Indian lands: Metlakatla, Kake and Klawock.
In response to a question by Representative Croft, Mr.
Barnhill explained that these were requests by the tribe for
an Indian land declaration from the NIGC rather than
lawsuits. The Department intervened in the Barrow case, and
attempted to intervene in the Kake and Akiachak cases but
was unsuccessful.
SUSAN BURKE, ATTORNEY, JUNEAU, stated that she was asked by
Mr. Green to look into the Indian gaming issues relating to
the bill.
Representative Croft asked if there is a procedure to
determine the status of Alaska lands under the Indian Gaming
Act before enacting this legislation.
Ms. Burke responded that village lands are not subject to
any alienation restrictions and explained that the only
lands held with federal restrictions on alienation are
individual Native allotments. It would be difficult for any
tribal entity to persuade the Indian Gaming Commission or a
court that it exercised governmental authority over the
allotment of land. She pointed out that the courts don't
issue advisory opinions.
Ms. Burke said that she did not see the bill as a major
threat to the proliferation of gaming in Alaska for two
reasons. The Alaska Gaming Commission would have the
authority to determine the games authorized in the Anchorage
casino. In the Ninth Circuit, the State is required to
negotiate with an Indian tribe only over specific games
authorized by law or regulation. She stressed that it is an
economic issue and she thought that Metlakatla, Kake and
Klawock are so isolated that it would be difficult to come
up with an economically feasible proposal.
In response to a question by Representative Croft, Ms. Burke
said that Eklutna had applied in the past for authority from
the Indian Gaming Commission.
TAPE HFC 04 - 92, Side B
Ms. Burke continued discussing Eklutna. She thought that
Eklutna would be unable to meet the governmental
jurisdiction aspect of Indian lands. She didn't know if
there was a Native allotment within the general Eklutna
area.
Representative Croft pointed out that the two issues
involved in the Indian Gaming Regulatory Act (IGRA) are the
lands issue and governmental authority by the tribe. He
asked if Native allotments would be considered Indian land
and not Indian Country.
Ms. Burke answered that Indian Country is not irrelevant in
relation to the reservations, and after the Venetie
Decision, people argued the issues of Indian lands or Indian
Country. The ANCSA settlement lands are not Indian Country
and were deeded to the regional and village corporations
without any alienation on restriction. The IGRA definition
of lands would not include the ANCSA lands.
Representative Croft asked if the Venetie and IGRA
definitions are identical. Ms. Burke said that Indian
Country and Indian land are distinct definitions. The
definition of Indian lands must be considered under the IGRA
and these include reservations, e.g. Metlakatla. Under the
IGRA definition, Indian lands also are lands held in trust
with restrictions on alienation imposed by the federal
government.
Representative Croft asked what it takes to change tribal
governance status. He pointed out that President Clinton
changed some of the authority given to tribes, allowing them
to operate nonprofit organizations. Ms. Burke said that
Congress has the authority to change tribal governance, but
not the President.
Representative Croft noted that Congress didn't declare the
Venetie Decision Indian Country yet. Ms. Burke affirmed, and
reiterated that Congress has authority over Indian issues
involving lands or powers.
Representative Hawker asked if passage of the bill would
expose the State to the intrusion of [indisc]. Mr. Barnhill
affirmed, and clarified that he said "yes" in relation to
Metlakatla. If Class 3 gaming were permitted in Anchorage,
Metlakatla would be able to conduct the same kind of gaming.
Outside of the known exceptions of Metlakatla, Kake, and
Klawock, he thought the odds were low that another parcel of
land could qualify as Indian lands because there must be
tribal governance over the land. He guessed there are
relatively few parcels with tribal governing power, while
noting that no one has done an exhaustive survey of all of
the potential parcels.
Representative Fate asked if Indian lands held in trust by
the Bureau of Indian Affairs (BIA) would become available.
Ms. Burke said that all village lands are subject to no
restrictions on alienation, and she was unaware of any
village land qualifying as Indian lands under IGRA.
Co-Chair Williams commented that Congress passed the 1991
Amendments involving a different type of trust similar to a
land bank wherein nothing can be done on village corporation
land. The land can't be taxed or worked. Ms. Burke affirmed
that it applies to regional corporation land.
In response to a question by Representative Stoltze, Ms.
Burk said no one knows how Eklutna's application would have
fared before the Indian Gaming Commission because they
withdrew it once the Legislature repealed the "Monte Carlo
Nights." She was not sure if the Legislature's concerns
were reasonable or unwarranted, or if Indian Gaming was the
only reason prompting the repeal of the Monte Carlo Nights.
In her view, Eklutna would have hard time persuading the
Commission that it exercises policing and taxing powers and
other governmental authority over its lands to qualify as
Indian lands under the definition. Lawyers always dispute
these issues, she said.
Representative Croft brought up page 4 of 6 on Fiscal Note
Component 2476, expressing surprise at how little revenue
would derive from tourists visiting the Anchorage casino.
He asked the source of the participation rates.
LARRY MEYERS, DEPUTY DIRECTOR, TAX DIVISION, DEPARTMENT OF
REVENUE, replied that the participation rates were based on
Oregon's 8 casinos and Washington's 17 casinos. Two percent
of the tourist population would visit the Anchorage casino.
In response to a question by Representative Croft, Mr.
Meyers clarified that the $50 million in revenue is the
"after prize receipts:" not total money circulated, but the
profit to the industry.
Representative Hawker referred to the same chart on page 4
of 6 of the fiscal note, asking if Total Tourists includes
both domestic and international tourists. Mr. Meyers replied
that the figure is derived from Northern Economics, and
reflects only the total domestic tourists statewide.
At Ease: 2:58 P.M.
Reconvene: 3:02 P.M.
Representative Foster MOVED to report CSHB 552(FIN) out of
Committee with individual recommendations and the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
CSHB 552(FIN) was REPORTED out of Committee with individual
recommendations and two new indeterminate fiscal impact
notes.
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