SANTA FE, N.M. – States fear Indian tribes with casinos could avoid sharing revenue with them by replacing slot machines with machines that look and play much the same but are classified differently, under recent federal court rulings.
The Denver-based 10th U.S. Circuit Court of Appeals, which covers New Mexico, has ruled that machines featuring bingo- and lottery-like games are not slots under the federal Indian Gaming Regulatory Act. The 8th Circuit, based in St. Louis, has ruled the same.
The Bush administration, backed by nine states, had asked the Supreme Court to hear an appeal of the rulings, arguing the machines were “indistinguishable in any meaningful sense from any other slot machine along the casino wall.” The Supreme Court on March 1 declined to hear the appeal.
New Mexico tribes, under gambling compacts with the state, pay the state a percentage from slot machine revenue. They’re expected to pay more than $40 million this year. Switching to pseudo-slots could allow them to avoid paying millions.
William Thompson, a professor at the University of Nevada in Las Vegas and a gaming expert who has testified before the New Mexico Legislature, said he believes tribes could install the machines and benefit economically.
“The player thinks it’s a slot machine,” he said. “They’ll get the same play on the machines. It throws a monkey wrench into the compacts.”
The tribes could risk political backlash if they didn’t pay the state a share. New Mexico could react, for example, by expanding off-reservation gambling to replace lost revenue from the tribes.
“If they play the greed game, in the long run they will be hurt,” Thompson said.
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