New Mexico Gaming Compact Dispute Goes in Favor of State, as Judge Rules Against Tribe

Posted on: April 26, 2017, 01:00h. 

Last updated on: April 26, 2017, 09:58h.

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Expertise: Commercial Gaming.

The two-year New Mexico gaming compact dispute between the state and Pueblo of Pojoaque Native American tribe has been settled, at least for the time being.

Three federal judges in the Tenth Circuit Court of Appeals in Denver ruled late last week that the tribe must come to terms on a new gaming compact with the state, not the US Department of the Interior (DOI).

New Mexico gaming compact Pojoaque Pueblo
The Pojoaque Pueblo people, led by Governor Joseph Talachy (pictured), want to change the law when it comes to Native American casinos, but the tribe was recently dealt a major blow in its New Mexico gaming compact lawsuit. (Image: Steven St. John/Wall Street Journal)

The Pojoaque Pueblo people own two casinos in New Mexico, the Buffalo Thunder Resort just north of Albuquerque, and Cities of Gold Hotel in Santa Fe. Buffalo Thunder is a full-fledged casino with slots and table games, while Cities of Gold is a smaller venue that features electronic gaming machines and bingo.

Both gaming floors, however, are currently operating as unlicensed casinos, at least that’s according to New Mexico Governor Susana Martinez (R). The tribe’s gaming compact with the state expired in 2015.

The governor in her second term says the Native American group must negotiate with the state in order to form a new gaming contract. The tribe says it owes the state nothing, and politicians in Santa Fe are trying to impose an unlawful tax. The Pueblos say they should deal with the US DOI, not the state.

But in the three-judge appeals ruling, the Tenth Circuit sided with the state. “We hope the Court of Appeals decision will bring this issue to a close,” Martinez’ spokesman Michael Lonergan said.

Pueblo vs. State

The tribe argued its sovereign rights are being violated in being forced to negotiate and share revenue with the state even though every other Class III Native American gaming facility in New Mexico has a compact.

The Indian Gaming Regulatory Act (IGRA), passed in 1988, established the framework for Indian gaming. One of the most important stipulations of the law is that while federally recognized tribes can operate Class I and II games on their sovereign reservations without federal or state approval, Class III games, which includes slots and table games, must be authorized by the tribe’s home state.

Under New Mexico’s new gaming compact with other tribes, the state demands tribes share up to nine percent of their annual adjusted net win. That percentage will grow to as high as 10.75 percent by 2030.

Odd Man Out

There are currently 16 other New Mexico gaming compacts in operation, including 12 sects of pueblos. But the Pojoaque people remain adamant that they aren’t willing to re-up with the state.

“The court clearly got it wrong,” the tribe said in a statement. “Since the US Supreme Court in the Seminole decision decided that states can use their immunity to prevent tribes from suing them to avoid a court ruling that the state did not negotiate a compact in good faith, IGRA cannot function as it was originally intended.”

The Seminole citation stems from Florida trying to expand gaming at its horse and greyhound racetracks, while still holding a compact with the powerful tribe. Like the Pojoaques, the Seminoles are currently operating their casino resorts in Florida without a valid compact.

Regardless, the Tenth Circuit ruling is a major blow for the New Mexico tribe.