[Federal Register Volume 76, Number 197 (Wednesday, October 12, 2011)]
[Pages 63325-63326]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-25932]



National Indian Gaming Commission

AGENCY: National Indian Gaming Commission.

ACTION: Notice of no action.


SUMMARY: On November 18, 2010, the National Indian Gaming Commission 
(NIGC) issued a Notice of Inquiry and Notice of Consultation advising 
the public that the NIGC was conducting a comprehensive review of its 
regulations and requesting public comment on the process for conducting 
the regulatory review. On April 4, 2011, after holding eight 
consultations and reviewing all comments, NIGC published a Notice of 
Regulatory Review Schedule setting out a consultation schedule and 
process for review. Based on the above review, the Commission notifies 
the public that it does not intend to take action at this time on 
certain other regulations identified in the Notice of Regulatory Review 

FOR FURTHER INFORMATION CONTACT: National Indian Gaming Commission, 
1441 L Street NW., Suite 9100 Washington, DC 20005. Telephone: 202-632-
7009; e-mail: reg.review@nigc.gov.

SUPPLEMENTARY INFORMATION: The Indian Gaming Regulatory Act (IGRA or 
Act), Public Law 100-497, 25 U.S.C. 2701 et seq., authorizes the NIGC 
to promulgate such regulations and guidelines as it deems appropriate 
to implement certain provisions of the Act. 25 U.S.C. 2706(b)(10). On 
November 12, 2010, the Commission issued a Notice of Inquiry (NOI) 
requesting comment on which of its regulations were most in need of 
revision, in what order the Commission should review its regulations, 
and the process NIGC should utilize to make revisions. The NOI was 
published in the Federal Register on November 18, 2010. 75 FR 70680. 
The Commission's regulatory review process established a tribal 
consultation schedule of 33 meetings over 11 months with a description 
of the regulation groups to be covered at each consultation.

I. Management Contracts--Collateral Agreements

    The NOI asked whether the Commission should consider promulgating a 
regulation requiring the review and approval of collateral agreements 
to a management contract. A majority of the comments submitted in 
response to the NOI stated that IGRA already allows for the review of 
collateral agreements to a management contract. After reviewing the 
comments received in response to the NOI, the Commission announced its 
intent to narrow its inquiry and only review the issue of approval of 
collateral agreements to a management contract.
    Public comments received during both the NOI and NRRA consultation 
and comment period have varied widely. Those comments supporting both 
the NIGC's review and approval of collateral agreements stated that the 
review and approval of collateral agreements would greatly reduce the 
risks to both Tribes and would-be management contractors, thus reducing 
overreaching by third parties; and that it is the NIGC's trust 
responsibility to the review and approval of collateral agreements in 
order to ensure that collateral agreements do not violate the sole 
proprietary interest provisions of IGRA.
    Public comments opposed to the required approval of collateral 
agreements state that collateral agreements are outside the scope of 
NIGC authority and requiring their submission and approval would allow 
the NIGC to second-guess tribal business decisions. Similar comments 
opposed NIGC review of non-management business relationships of the 
Tribe; and that requiring the submission and approval of collateral 
agreements would expand NIGC authority beyond what is authorized by the 
IGRA. Public commentators also stated that requiring the approval of 
collateral agreements could affect the development of business 
relationships and discourage private investment in Indian country. 
These commentators recommended the NIGC only review and approve those 
collateral agreements that contain management provisions separate from 
those in the related management contract. Public commentators also 
expressed their concern over the length of time it currently takes for 
the NIGC to review and approve a management contract and that the 
required approval of collateral agreements would further increase that 
time. Finally, one commenter noted the sensitive, proprietary 
information contained in collateral agreements and suggested the NIGC 
review collateral agreements only at the gaming facility.
    The Commission reviewed the comments received and has decided to 
not promulgate a regulation requiring NIGC approval of collateral 
agreements to management contracts at this time. IGRA provides for 
approval of management agreements. 25 U.S.C. 2705(a)(4). IGRA does not 
require approval of agreements collateral to management contracts 
unless those agreements also provide for management. The Commission's 
decision today does not prevent tribes from submitting any agreement, 
collateral or not, for NIGC review to determine whether the agreement 
provides for management. As a matter of practice, the NIGC regularly 
reviews a variety of agreements to determine if the agreements in fact 
provide for management. To be clear, the Commission's decision today 
does not alter in any way, the NIGC's continued practice of reviewing 
agreements for management. The Commission notes that any contract that 
provides for management that has not been approved by the Chairwoman is 
void. 25 CFR 533.7. Further, managing without an approved contract is a 
substantial violation of IGRA that can result in an enforcement action 
and closure order. 25 CFR 573.6(a)(7).

II. Definitions--Net Revenues--management fee

    The NOI asked whether the Commission should consider whether the 
definition of net revenues for the purposes of calculating the 
management fees should be defined to be consistent with the General 
Accepted Accounting Principles (GAAP). Many comments stated that if 
this definition was amended, it would still need to remain consistent 
with the statutory definition of net revenues contained in IGRA, 25 
U.S.C. 2703(9). Other comments stated that it should be defined 
consistent with industry standards such as GAAP. One comment noted that 
a clearer definition would have resolved a dispute with their state 
over the definition of net win and net revenue. Another comment stated 
that the 2008 regulatory change to the definition of net revenue does 
not comply with IGRA and needs to be revised to ensure it is consistent 
with the statutory definition.
    The Commission has reviewed the comments received during both the 
NOI and NRRA comment and consultation periods and has decided not to 
issue a rule at this time amending the definition of net revenues set 
forth at 25 CFR 502.16. The Commission agrees that changing the 
definition to be consistent

[[Page 63326]]

with GAAP could result in a definition that is inconsistent with the 
statutory definition contained in 25 U.S.C. 2703(9).

    Dated: October 3, 2011, Washington, DC.
Tracie L. Stevens,
Steffani A. Cochran,
Daniel J. Little,
Associate Commissioner.
[FR Doc. 2011-25932 Filed 10-11-11; 8:45 am]