The US District Court for Western Oklahoma has ruled in favour of tribal operators in the state, determining that Oklahoma’s tribal gaming compacts automatically renewed on January 1 of this year.
US District Court Judge Timothy DeGiusti sided with tribes including the Cherokee, Chickasaw and Choctaw Nations who sued Governor Kevin Stitt. They argued that the compacts did not end when the 15-year compact came to a close but rather automatically renewed for a further 15 years.
Stitt, on the other hand, claimed that the compacts came to an end, and would have to be renegotiated.
DeGiusi agreed with the tribes’ interpretation of the contracts, that they allowed for automatic renewal if other non-tribal organisations were authorised to offer electronic gaming other than on-course pari-mutuel wagering.
“I am deeply disappointed by the federal court’s ruling,” Stitt said. “It confirms my fears, and the fears of many fellow Oklahomans, that the state entered into a poorly negotiated deal and now we must bear the cost of this mistake.
“The federal court determined that the 2004 Gaming Compact auto renewed for 15 years because of an action taken by an agency’s unelected board to reissue licenses for gaming at horse racing tracks.”
Cherokee Nation Principal Chief Chuck Hoskin Jr said the ruling would mean tribal gaming in Oklahoma will have a strong future.
“The Cherokee Nation is pleased with today’s ruling which affirms what our tribal nations have known from the beginning, that our gaming compacts with the state of Oklahoma renewed on January 1 for another 15 years,” Hoskin said.
“Tribal gaming in this state will continue to be strong, not only for tribes, but for all of Oklahoma, contributing vital education dollars into our public schools and bolstering health care, roads and communities.”
Stitt, however, said the decision – combined with the Supreme Court’s ruling in McGirt vs Oklahoma that much of the eastern portion of the state of Oklahoma remains as Native American lands – raises questions about the future tax regime of tribal gaming in the state.
“This decision, coupled with the recent US Supreme Court ruling on McGirt, means Oklahomans have important questions to face regarding our future,” Stitt said. “Among other things, we will need to explore the challenges of who will pay taxes and who won’t, of how we will guarantee a competitive marketplace, and of how the State will fund core public services into the next generation.
“In short, we face a question of constitutional proportions about what it means to be the state of Oklahoma and how we regulate and oversee all business in our state.”
The decision marks another legal defeat for Stitt regarding tribal gaming. Last week, the Oklahoma Supreme Court voted to reject two tribal gaming compacts signed by Stitt, ruling that both agreements are invalid under state law.
Stitt signed gaming compacts with the Otoe-Missouria Tribe and the Comanche Nation in April, allowing the two tribes to offer Class III games, including sports betting, poker, roulette, slots and blackjack.
However, the compacts faced heavy criticism from the state legislature and other tribal operators, with Oklahoma Attorney General Mike Hunter having issued a formal opinion arguing Stitt did not have the power to broker the deals.
The state’s Supreme Court voted 7-1 to reject the compacts, ruling the deals cannot be deemed legal as they include games that have not yet been approved in the state and therefore generating revenue from the games is prohibited.