Welfare participation slows among Indian tribes with casino operations

David Pace

Friday, Sept. 1, 2000 | 4:52 a.m.

WASHINGTON - Welfare rolls are still growing on Indian reservations, but the casino gambling boom of the 1990s has helped slow that growth and left some tribes hopeful they'll one day reverse the poverty that has plagued them.

The explosion of gambling money - from $100 million in 1988 to $8.26 billion a decade later - also has triggered a debate in Indian country over whether casino profits should be returned directly to tribal members or reinvested in the community for such things as schools, housing and public works.

"If tribes are making all that money, members are asking, 'When am I going to see some of it?"' said Eddie Brown, who headed the Bureau of Indian Affairs during the Bush administration. "That pressure is beginning to build."

An Associated Press computer analysis of federal records found that the influx of gambling money has done little to change the historically high poverty and unemployment rates on Indian reservations. But it does appear to have slowed the growth of public assistance.

Among the 72 tribes with casinos that use the Agriculture Department's Food Distribution Program on Indian Reservations, household participation increased by 8.2 percent between 1990 to 1997. But that was far less than the 57.3 percent increase among the 44 non-gaming tribes that use the program.

Similarly, the number of American Indian households participating in the food stamp program in states that permit casino gambling increased 5.6 percent between 1990 and 1998. But in states that don't allow casinos, the number of Indian households using food stamps jumped 17.7 percent.

Brown said most of the reduction in Indian welfare rolls can be traced to direct payments that some tribes provide to members from casino profits. The Fort McDowell Mohave-Apache community just outside Phoenix, he said, has become "welfare independent." Its 849 members receive as much as $30,000 a year apiece in casino payments.

A total of 48 tribes have obtained approval from the Bureau of Indian Affairs to transfer casino profits directly to members. While the bureau refuses to disclose the size of those payments, they range as high as $900,000 a year for each of the more than 200 members of the Shakopee Mdewakanton Dakota Tribe in Minnesota.

Such direct payments can dramatically reduce welfare rolls, but many tribal leaders argue that the best way to attack the high poverty and unemployment rates on Indian reservations is to reinvest the money in education and infrastructure.

At the 20,000-member Gila River Indian community just south of Phoenix, tribal leaders have done just that. More than $100 million in casino profits has gone into capital improvement projects, and the community's annual budget for tribal programs has increased 10-fold to nearly $100 million since the casinos opened.

"We're committed to providing services to the community rather than the individual," said Donald Antone, the new Gila River governor.

Gila River now provides college or vocational schools scholarships to any member who meets certain academic standards. The tribe also is using its casino profits to diversify economically, with a $120 million resort hotel and golf course scheduled to open over the next two years.

The Mille Lacs Band of Ojibwe in Minnesota followed a similar route for most of the past decade, investing most profits from its two highly successful casinos in reservation infrastructure and social programs, while paying band members $1,500 annually.

But the band's nine-year leader was defeated in a landslide earlier this summer by a candidate promising to abide by a tribal referendum on whether payments to band members from casino profits should be increased.

"It's up to the people," said Melanie Benjamin, the band's new chief executive. "They have to decide their own destiny."

The Mille Lacs Band and the Gila River Community are two of 23 tribes across the country owning casinos that grossed more than $100 million in 1998. Those 23 together accounted for 56 percent of total Indian gaming revenues that year.

For the 80,000 Indians who belong to those 23 tribes - about 5 percent of the total Indian population - the impact of casino gambling has been substantial.

Unemployment among those 23 tribes dropped from 34.5 percent in 1991 to 27.7 percent in 1997, according to BIA records. The average poverty rate in counties that comprise their reservations fell from 16.7 percent in 1989 to 14.2 percent six years later; the median household income increased by 30 percent, from $23,937 to $31,153.

But tribal leaders say casino profits have just scratched the surface of the economic and social problems confronting their reservations.

On the 582-square mile Gila River reservation, for example, adobe houses with no indoor plumbing or utilities still dot the landscape. The community's Public Works Department has provided utility service to 500 new home sites since 1995, but hundreds remain on waiting lists for housing.

"We've been so far behind in everything that the money we're getting is almost like a drop in the bucket," said Antone.

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On the Net:

AP Web site with additional Indian gambling data: http://wire.ap.org

National Indian Gaming Commission: http://www.nigc.gov/

Bureau of Indian Affairs: http://www.doi.gov/bureau-indian-affairs.html

National Indian Gaming Association: http://www.indiangaming.org/