Babbitt allows N.M. Indian gambling compacts to take effect

Saturday, Aug. 23, 1997 | 9:22 a.m.

His decision keeps casinos across New Mexico open, but it could lead to more legal wrangling.

"This is a good day for the tribes ... and the 4000 employees in our tribal government gaming operations," said Frank Chaves, co-chairman of the New Mexico Indian Gaming Association.

Casino workers "can breathe easier, knowing the threat of closure and the loss of their jobs is finally over," he said.

Approval of the compacts also triggers off-reservation gambling - slot machines at race tracks and at veterans' and fraternal clubs - but not immediately.

Babbitt had until Saturday to either sign, reject, or take no action on compacts written by the Legislature and signed by tribes and Gov. Gary Johnson.

Under federal law, the no-action decision means the compacts automatically take effect - but only to the extent they comply with the federal Indian Gaming Regulatory Act.

Tribes believe the revenue requirements of the agreements they signed - hefty regulatory fees and 16 percent of slot machine profits to the state - are too high and violate federal law.

Tribes could challenge them in court or perhaps somehow invoke the compacts' arbitration procedure to settle the question.

Or, as tribal spokesmen and Attorney General Tom Udall suggested Friday, they could negotiate new provisions with the state.

Chaves in a statement said the revenue dispute "can be settled with true negotiation."

Udall said if tribes want to negotiate, "I think we all ought to make a stab at it. I don't see litigation as a fruitful course."

It was unclear, however, just how that would work - whether the negotiating would be done with the governor, Legislature or both.

The first payments from casinos are not due to the state until Oct. 25.

Udall said he was disappointed with Babbitt's decision, which he said "raises more questions than it answers."

He had asked Babbitt to decide one way or another, rather than simply let the 45-day deadline pass.

Eleven tribes presently operate casinos. They and four additional tribes have signed compacts. Johnson has signed 14 of the pacts; he hadn't had a chance by Friday to review the other one.

Babbitt made no comment Friday as to why he chose the no-action alternative. Gov. Johnson, however, said Babbitt told him he would send a letter of explanation shortly.

The compacts become effective when notice is published in the Federal Register, likely within a few days.

The Legislature, when it wrote the compacts this year, decided race tracks and veterans' and fraternal clubs could have slot machines once compacts took effect.

From a practical standpoint, however, that could be many months away. There is no money in this year's state budget for the regulatory apparatus that must be in place before slot machines could be plugged in.

And gambling opponents may challenge the validity of the off-reservation gambling in addition to challenging the legality of the compacts.

Opponents argue the compacts-and-gambling law passed by the Legislature is a single package and that if any of the provisions is invalid, the whole package is void. Tribes dispute that.

Victor Marshall, an Albuquerque lawyer for gambling opponents, said Babbitt's decision allowed the tribes to carry out a "bait and switch legal maneuver."

"They used the promise of all this money to squeak this through the Legislature. But the tribes never had any intention of paying this money. Now they're going to thumb their noses at the state," Marshall said.

Marshall has a lawsuit pending in state district court that challenges the constitutionality of the compacts-and-gambling law.

Indian gambling has been in dispute in New Mexico for about nine years. Fourteen tribes and Johnson signed compacts in 1995 that were ruled illegal by state and federal courts because the Legislature hadn't approved them.

The casinos have been allowed to remain open while the tribes appeal those rulings to the U.S. Supreme Court, which is expected to decide in October whether to hear it.