[Federal Register Volume 83, Number 156 (Monday, August 13, 2018)]
[Rules and Regulations]
[Pages 39877-39879]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-16254]
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DEPARTMENT OF THE INTERIOR
National Indian Gaming Commission
25 CFR Part 542
RIN 3141-AA55
Minimum Internal Control Standards
AGENCY: National Indian Gaming Commission, Department of the Interior.
ACTION: Notification of final rulemaking; stay.
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SUMMARY: The National Indian Gaming Commission (NIGC) is suspending its
minimum internal control standards (MICS) for Class III gaming under
the Indian Gaming Regulatory Act. Updated guidance for Class III MICS
will now be maintained at www.nigc.gov.
DATES: This rule is effective September 27, 2018. Title 25 CFR part 542
is stayed effective September 27, 2018.
FOR FURTHER INFORMATION CONTACT: Jennifer Lawson at 202-632-7003 or
write to [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
The NIGC Class III MICS were promulgated in 1999 and last
substantively revised in 2005. In 2006, the D.C. Circuit Court of
Appeals in Colorado River Indian Tribes v. Nat'l Indian Gaming Comm'n,
466 F.3d 134 (CRIT v. NIGC), held that NIGC lacked authority to enforce
or promulgate Class III MICS. Since that time, the Class III MICS have
remained untouched. Technology has advanced rapidly, though, making
some standards obsolete and introducing new areas of risk not
contemplated by the outdated standards. And yet, many tribal-state
compacts--even those entered into since 2006--continue to adopt NIGC
Class III MICS by reference.
II. Development of the Rule
In light of the ruling in CRIT v. NIGC and recognizing the
industry's need for updated standards, the NIGC sought comment on what
to do with the outdated standards still remaining in the regulations
and whether to draft updated, non-binding guidance for Class III MICS.
Between 2015 and 2016, over
[[Page 39878]]
forty tribes provided comment and overwhelmingly supported the NIGC
proposal for non-binding guidance. Many also supported keeping the
existing 542 regulations in the Code of Federal Regulations, even
though they would be unenforceable, to minimize impacts on tribal/state
compacts that incorporate them by reference. Additionally, the
Commission sent letters to state gaming regulators on June 14, 2017,
requesting comment on the draft guidance. One responded with
recommendations.
In light of these comments, the Commission has developed non-
binding guidance for Class III MICS and is suspending the existing part
542 regulations. Doing so will leave the existing regulations ``on the
books,'' but with an editorial note stating that they are not
enforceable. The updated guidance document for Class III MICS is
available on the NIGC website at www.nigc.gov. This guidance is not
intended to modify or amend any terms in a state compact.
Because the document will be guidance instead of regulations, NIGC
will be able to keep it updated and adapt much more quickly to changes
in the industry.
III. Regulatory Matters
Notice and Comment
Typically, the suspension of Agency regulations would require the
Agency to follow the notice and comment process mandated by the
Administrative Procedure Act (APA). However, the APA permits agencies
to finalize some rules without first publishing a proposed rule in the
Federal Register. This exception is limited to cases where the agency
has ``good cause'' to find that the notice-and-comment process would be
``impracticable, unnecessary, or contrary to the public interest.'' In
this case, because the D.C. Circuit has ruled that the NIGC may not
enforce its Class III MICS, or even maintain them as agency
regulations, the NIGC has good cause to find that the notice and
comment period is unnecessary and may directly publish a final rule
suspending the Class III MICS regulations. The NIGC did not appeal the
Circuit court's decision to the United States Supreme Court, so it is
the law of the land and the NIGC has no discretion in regard to
following the court's mandates.
Regulatory Flexibility Act
The 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 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 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 rule does not unduly burden the judicial system and
meets the requirements of sections 3(a) and 3(b)(2) of the Order.
National Environmental Policy Act
The Commission has determined that the 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
Suspending part 542 also suspends any information collection
requirements contained within. Therefore, no detailed statement is
required pursuant to the Paperwork Reduction Act, 44 U.S.C. 3501, et
seq.
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.
On February 26, 2015, the Commission announced consultation and
sought comments over its plans to draft updated, non-mandatory Class
III MICS guidance and proposal to withdraw the part 542 regulations.
The Commission held four in-person and one telephonic consultation
sessions. The consultation and comment period ended on February 23,
2016. Over forty tribes commented on the plan. As a result of the
comments, the Commission, on November 22, 2016, announced its proposal
to suspend the part 542 regulations and issue updated, non-mandatory
Class III MICS guidance. The Commission developed and shared a draft of
the guidance and held six in-person consultation sessions. The
Commission received comments through July 2017.
List of Subjects in 25 CFR Part 542
Accounting, Administrative practice and procedure, Gambling,
Indian--Indian lands, Reporting and recordkeeping requirements.
For the reasons discussed in the preamble, the Commission amends 25
CFR part 542 as follows:
PART 542--MINIMUM INTERNAL CONTROL STANDARDS
0
1. The authority for part 542 is revised to read as follows:
Authority: 25 U.S.C. 2706(b)(10).
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2. Section 542.1 is revised to read as follows:
Sec. 542.1 What does this part cover?
(a) This part previously established the minimum internal control
standards for gaming operations on Indian land.
(b) This part is suspended pursuant to the decision in Colorado
River Indian Tribes v. Nat'l Indian Gaming Comm'n, 466 F.3d 134 (D.C.
Cir. 2006). Updated
[[Page 39879]]
non-binding guidance on Class III Minimum Internal Control Standards
may be found at www.nigc.gov.
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3. Effective September 27, 2018, part 542 is stayed.
Dated: July 18, 2018.
Jonodev O. Chaudhuri,
Chairman.
Dated: July 18, 2018.
Kathryn Isom-Clause,
Vice Chair.
[FR Doc. 2018-16254 Filed 8-10-18; 8:45 am]
BILLING CODE 7565-01-P