Patrick B. McGuigan
OKLAHOMA CITY – As another cluster of tax increases edged through the Oklahoma state Senate on Friday (April 6), the state chief executive’s office issued this statement: “When the governor’s office receives the bills being heard today in the Senate, the governor will review them with her staff. This is her usual practice to check the language of the final version, and to ensure the bills satisfy legal and constitutional requirements.”
Set aside for a moment the recent embrace, by a majority of legislative Republicans, of the largest tax increases in modern Oklahoma history, perhaps the largest ever.
It is what it is, although Oklahomans who believed in messages heard during the 2010 and 2014 Republican political campaigns are organizing legal and petition challenges to the measures.
For the moment, focus on what is.
The governor and other Republican leaders long declined efforts, driven by the state’s larger tribes, to support expanded gaming, and in fact they often (sometimes quietly) opposed it.
State officials know that Oklahoma tribes pay a lower percentage of gaming revenue, through compacts that yield “exclusivity fees,” than is paid by tribes in many other states (including New Mexico, Connecticut and Pennsylvania). If Oklahoma tribes had paid at higher rates, the total to date would be several billion, rather than a little more than $1 billion over a decade.
State leaders, every one of them a Republican, now have to decide which way to break on the revenue-driven proposal to allow “ball and dice” gambling.
Legislators certainly seem to favor it, but that perhaps was in the heat of the tax-and-spend moment. Like passion, such a moment may pass as the price becomes clearer. Eventually, tomorrow comes.
Keep reading, even if you are among those who like the tax hikes of recent weeks.
This is a pivotal moment because of a legal ruling rendering compacts between the state and tribes unenforceable. They are still the law, mind you, but without “teeth.”
The compacts must be renegotiated and new provisions be made enforceable, or they will renew (as dead letters) automatically in 2020.
Long opposed to the growth of gaming, Republicans (like the Democrats who governed the state before them) have been silent as federal and regional administrative decisions granted more and more lands that were dubiously deemed “Indian Country” to larger tribes. They knew, and know, what was going on was bad policy, but settled for a sort of “Scarlett O’Hara” syndrome:
“I’ll worry about that tomorrow.”
Briefly underscoring the issue: What has happened as an outflow of past decisions is that economic strength empowered the larger tribes to grab a larger and larger percentage of tribal program funding from the federal government over the past two generations.
This was allowed as lineal descendant status overrode a higher cultural connection standard for membership in the larger tribes — and that became the predominant factor in the funding equation.
To illustrate the impact over time, the Cherokee who came to Oklahoma with just over 4,000 tribal members (but now claim 400,000) get by some measures $700 million a year from federal programs.
The KCA (Kiowa, Comanche and Apache) who came to Oklahoma with roughly half that number, get less than 5 percent of those funds, collectively.
Many understand the negative effect this has had on the relative positions of the smaller tribes, but it has been another issue many say they will worry about … tomorrow.
To bring this home to all Oklahomans, if a government official puts tomorrow off long enough, they feel they must, eventually, pass massive tax hikes, including on industries that are cyclical and boom/bust in nature. And then, they find out that is still not enough.
Since the 1970s, the cumulative effect of the above-referenced tribal land trust decisions has been to expand political power and economic strength for larger Nations, to reduce power and economic vitality for the smaller tribes, and leave the state government (which operated from a comparatively weakened position because of poorly drawn compacts) unable to secure larger exclusivity fee payments or to balance the scale for the smaller tribes.
With that preface, there is an alternative (several, actually) to further tax increases on taxpayers.
The alternative of most significance right now (for the next day or two) relates to Indian gaming. The governor can and should veto that “ball and dice” measure that passed the Senate on Friday – and then should call for renegotiation of tribal compacts under powers in Section 20 (governor approval) of the Indian Gaming Regulatory Act 25 (U.S.C. 2719).
A veto of the “ball and dice” measure would put the entire gaming issue and the related finances on the table.
The state already foregoes millions in potential revenues, because of the compact requirements for the exclusivity fees.
If negotiated at a higher rate the amount could amount to billions (not millions) over the course of the coming decades. And for emphasis: Keep in mind that regardless of the scope of gaming, and the terms of exclusivity fees, if smaller tribes have no markets left their equal opportunities will be limited.
In a commentary early in this year’s legislative session, I asked rhetorically if the state government of Oklahoma would “really forego hundreds of millions in annual revenues in return for a few million?”
The question is no longer rhetorical. What if tomorrow never comes?
NOTE: McGuigan has reported on state government and on “Indian Country” issues regularly since 1990. In 2013, his reporting on the late Archie Hoffman and aspirations of the Cheyenne & Arapaho Tribes of Oklahoma won first place from the Society of Professional Journalists, Oklahoma Chapter, in the “diversity news reporting” category.