NationaI Indian Gaming Cammission 

NOTICE OF VIOLATION 

Ralph Sampson, Jr., Chairman of the Yakama Nation Tribal Council 

240 Fort Road 

Toppenish, WA 98948 

Fax: 509-865-5528 

Wallace Yallup, Chairman of the Yaha Nation Tfibal Gaming Corporation 

580 Fort Road 

Toppemsh, WA 98948 

Fax: 509-856-5528 

Roger Fiander, Chan of the Yakama Nation Gaming Commission (Agent for 

Servlce of Process) 

580 Fort Road 

Toppenish, ZVA 98948 

Fax: 509-865-7867 

1. Notification of Violation 

The Chairman of the National Indian Gaming Commission (NIGC) hereby gives 

noace that the Confederated Tribes and Bands of the Yakama Nation of 

Washingon (Nation), Iocatecl in Toppenisb, Wasllington and operators of the 

Yakama Legends Casino (Casino), Iocated at 580 Foa Rd, Toppcnish, Washington, 

have violated the Indian Gaming Regulatory Act (TGRA), 25 U.S.C.$2771 et seq., 

Nationd Indmn C;armng Commission (NIGC) regulations, 25 C.F.R. 501 ct seq., 

and the Yakarna Gaming Ordinance by dscributing per capita payments of net 

gaming revenue to its tribal members without an approved tribal revenue allocarion 

plan (RAP). 

Moreover, the Nation has violated the Indian Gming Regulatory Act (IGRA), 25 

U.S.C. 5 2701 et seq., NationaI Indian Gaming Commission (NIGC) ReguEauons, 25 

C.F.K. 5 501 et seq., and the Yakama Gaming Orchance by distributing thcsc 

payments to its tribal members for unrestricted use for which the tribe as a whole is 

not the beneficiary. This is an impermissible use of gaming revenues under IGRA 

because these payments were not for the general welfare of the Indian tribe and its 

members. Direct payments to individual tribal members made without an 

approved RAP, or made outside of a tribal. government program based on a tribal 
community need; that bas specific eligibility criteria; and a direct relationship to 

that need, are not permissible. 

2. Authority 

Under IGRA and NIGC xegdations, the Chairman of the NIGC may issue a Notice 

of Violation (NOV) to any person for violation of any provision of the IGRA, 

NIGC regulations, or a tribal gaming ordinance or resolution approved by the 

Chairman. 25 U.S.C. 5 271 3; 25 C.F.R. 573.3. 

3. A~wlicable Federa1 Laws. Re~ulations and Tribal Ordinance Provisions 

A. Net revenues from any class I1 and 111 gaming activities conducted or 

licensed by any Indian tribe may be used to make per capita payments to 

members of the Indian tribe ody if the tribe has received approval horn the 

Bureau of Indian Affairs for such a cbstribution. 25 U.S.C. 5 2710 

(a)(3S(*-DS; (d)(V(A)(fiIB. The tern "net revenues" is dehned in IGRA, NIGC regulations and the 

Yakama Nation Gaming Ordinance as "gross revenues of an Inb gaming 

activity Iess amounts paid out as, or paid for, prizes and total operating 

expenses, excludrng management fees." 25 U.S.C. $2703(9), 25 C.E.R. 

5 502.1 6, Yakama Indian Nation Gamrng Ordinance of 1994, 2, Defbitions 

(4- 

C. If a tribe does not have an approved tribal revenue aUocation plan that 

provides for per capita payments to its members, the tribe may only use net 

gaming revenues to fund tribal government operations or programs; to 

provide for the general welfare of the tribe and its members; to promote 

tribal economic development; to donate to charitabIe organizations; or to 

help fund operations of local government agencies. 25 U.S.C. $2710 

(b)(2)(13); 25 C.F.R. 5 290.9. 

D. The appropriate BIA officiaI will review and approve tribal revenue 

allocation plans pursuant to RIA regulation. 25 C.F.R 5 290.2 and 290.5. 

E. A tribal revenue allocation plan is not effective without the appropriate 

BIA official's written approval pursuant to BLA regulation. 25 U.S.C. 

5 2710@)(3)(B); 25 C.F.R. $290.11. 

F. A tribe may make per capita payments only after the appropriate BIA 

official approves the tribe's revenue allocation plan pursuant to RPA 

regulation. 25 U.S.C. $2710@)(3)(R); 25 CFR 5% 290.10,290.11, and 290.13. 
G. Except as provided pursuant to IGRA, all revenues generated from any 

class I1 or class I11 Gaming Actidties are the propeq of the Nation. No 

indrvidual member shall be deemed to have any interest in such profits or net 

revenues and payments from ttibal accounts under other tribal programs, 

including those related to hedth, welfare, education, elderly care, and 

housing, shall not be deemed to be per capita payments. The Nation 

acknowledges the requirements of IGM, 25 U.S.C. 5 2710 @)(3) reprdq 

pmmg revenues. Yakama Indian Nation Gaming Ordrnance of 1394, 

57 Gaming Revenues. 

H. The Yakam Nation Gaming Ordinance provides the same five permitted 

uses of gaming revenue as does 25 U.S.C. 2710 @3(2)(B). See 3 (C). 

Yakama Nation Gaming Ordrnance sf 1394,s 7, Gaming Re~enues. 

4. Circumstances of the Violation 

A. The Nation is a federaIIy recoped Indlan tribe with tribal headquarters 

in Toppenish, Washington. 

B. Since approximately 1998, the Nation has operated a casino pursuant to 

IGM and the Yakama Gaming Ordinance. The Orhnance, whrch 

authorizes both class I1 and class 111 gaming, was approved by the NIGC 

Chairman on September 12,1994. 

C. On December 10,2008, the Nation submitted a RAP for approval to the 

U.S. Department of the Interior POI), BIA, Yakama Agency 

Superintendent, Guy "Bucl" Rogers, in Toppmish, Washington. The plan 

proposed that forty percent (40%) of net gaming revenue be allocated for 

per capita distribution after consideration of the need to fund tribal 

government operations and programs and in accordance with 25 C.F.R. 

Part 290. Yakama Nation proposed RAP 5 6. 

E. On December 2 1,2008, at the Yakama Nation Annual General Cound 

meeting, BLA Superintendent Rogers commented on a motion on the 

floor for &scussion. The motion was to approve a one-time economic 

shdus in the amount of $2,000 to dl members "to provide for the 

general welfare of our tribal members and to promote our tribal economic 

development." BLA Superintendent Rogers said: 

What I said was that I thought that ths money could be 

considered to be in the realm of economic development 

based on what the Nation is doing currcndy with hs 

economic stimulus but I did say that I did not have the 

authority to de on it and that P would have to check with 

the people in Washington, D .C. which I codd do tomorrow 
morning and so I am, I don't really have the auihority to 

ruIe on it but that's my opinion. 

Tape 3 of 4, Budget and Finance Committee Q's and A's, Yakama Nation 

Annual General Council, December 1 1,2008. 

D. On December 1 1,2008, BTA Superintendent Rogers submitted a 

memorandum to the DOT, Director of the Office of Indian Gaming, 

forwarding the Nation's RAP submission and requesting review "as 

quickly as possible." BIA Superintendent Rogers' memorandum stated 

that " no previous tribal revenue allocation pIans, ctc are in existence.. . ." 

F. On December 16,2008, BIA Superintendent Rogers responded to the 

Tribe in writing regarding the Nation's submission of the proposed RAP. 

He advised Chief Sampson that Nancy Piers&, a Management Analyst 

at DO1 Office of Indian Gang, had identified an issue in the definition 

of "full-time student" in the submission. Specifically, Management 

Analyst PierskaUa "wanted the statement to be more specific to clari3 if 

the students would be those over 18 years of age.. .if this clefmition 

included minors, several addztional changes would be required psior to 

RAP approval and she could not guarantee she could recommend 

approval of it today." 

G. On December 16,2008, BIA Superintendent Rogers sent an e-mail to 

Managemcnt Analyst, Nancy Pierskalla, and Paula Hart, DO1 Acting 

Director of the Office of Indian Gaming. In the e-mad, he stated that the 

'Yalcama Nation higbly desires to dstdbute their planned Yalrama Nation 

economic stimdus funds priar to Christmas.. . .At your dest 

convenience, plcase let us know when you are abIe to approve this plan as 

mo&ed defining tihe Enrolled FULL-TIME Student will (sic) as students 

over 18 years of age who have reached majority as dehed by the tribe. As 

set forth in the fax, the Tribal Attorney is drafting the exact language of 

the dehnition of this term which is to be sent to you later today. . .Ms 

Pierskalla d be on vacation bewg tomorrow, as d I." 

H. On December 18,2008, DOT Acting Director, Officc of Inhn Gaming, 

Paula Hart sent RIA Superintendent Rogers an e-mail, entitled " Request 

to Approve the Confederated Tribes and Bands of the Yakarna Nation 

Revenue Allocation Plan of Gaming Net Revenue." In her e-marl, Acting 

Director Hart stated "'I just received a call from NIGC that the Tribe was 

preparing to distribute the money under this plan. As of today we have not 

received the changcs requested. Is there any news on that request?" 

I. Also on December 18,2008, NIGC Region Director fot the Portland, 

Oregon office, Mark Phillips, had a telephone conversation with Yakama 

Gaming Commission Chairman, Roger Fiander. Director Phillips 
informed Chainnan Fiander that "'the dis&bution was not autholized 

without an approved revenue allocation plan (RAP) and, therefore, the 

NIGC wodd object to any such distribution." Further, NIGC Region 

Director PWlips read to Chairman Fiander the "specific chapters of IGU 

regarding distributions to individual Nation members and explained that 

IGRA was very dear on the distributions of gaming revenue to individual 

tribaI members." Chairman Fiander acknowledged that a RAP had been 

submitted to the BIA but had not yet been approved. 

On Decembm 24,2008, DL4 Superintendent Rogers responded to the 

December 18 e-mail from Acting Director Hart. Mr. Rogers inhcated, 

"[a]s I stated in my email attached [December 16,2008, fax to Ms 

Pierskalla and to Ms. Hart], I was on annual leave . . .My last day at work 

was Tuesday, December 16,2008 and I returned yesterday, Tuesday 

December 24,2008. Prior to my leaving, I told the Tribal Officials they 

could either send the recommended change [to the per capita plan] ditectly 

to you folks, or give the change to the Deputy Supehtendent who would 

then foxward it to you all. I was told the Tribe chose to send the minor 

recommended change hectly to you and the YaIrama agency &d not 

receive a copy. Since all of the folks involved here are on Ckrisunas 

vacation, I have not been able to discuss the matter with them." 

K. In an e-mail dated December 30,2008 to BLA Superintendent Rogers, 

Acting Director Hart acknowledged receipt of the "minor correction from 

the Tribe right before Chstmas" and the fact that Management Analyst 

PierskalIa was still on holiday vacation. 

L. "The Yakama Nation Legends Casino Independent Auditor's Report and 

Financial Statements with Supplemental Infomation" was addressed to 

the Yakama Nation Legends Casino Board of Directors and signed on 

January 27,2009, by Moss Adams, LLP, an independent outside CPA 

h. The report, for the fiscal year ending September 30,2008, mas 

submitted to the NIGC on January 28,2009. 

M. On page 15 of the audrt report under "Notes to the Financial Statement," 

Note 11 states "OR December 11,2008, the Nation approved an 

economic stimulus distribution to its membership of $2,000 per member. 

Based on exiscing membershp on that date, the distribution totaled 

approximately $20.4 don. The Casino's Cash reserves were used to 

fuad this distribution, which will be recorded as a transfer to the Nation 

during fiscal 2009." 

N. Concerning the ds~bution of net revenue made on or about December 

19,2008, Yahma Nation Chairman Ralph Sampson stipulated on March 

3,2009 that: "On or about December 19,2008, the Yakama Nation paid 

$2,000.00 to each of its approximately 10,213 enroued Yaha Tribal 
members. The payments were made from a Yakama Nation bank account 

con* funds derived almost entirely from Yakama Legends Casino net 

gaming revenue." 

0. On February 23,2009, George Slubine, DO1 Deputy Assistant Secretary of 

Indian Affairs sent a letter to the Nation's Chhn, hlph Sampson, 

advising hun that the RAP submitted on December 11,2008 was now 

approved. Consequently, the Nation &d not possess a RAP which had 

been approved in writing by the Secretary of the Department of he 

Interior or hzs delegate on or about December 19,2008 when tkc 

distribution of net gaming revenues was made to its individual tribal 

members. 

P. On February 25,2009, NIGC Field Investigator Gary Peterson was 

advised by Joe Kjncaid, Internal Revenue Service Group Manager for 

Indian Tribal Governments that ttibes are required to issue an IRS FORM 

1099 to each recipient of over $600 in non-employee compensation, which 

is the category that per capita payments fall hto. 

Q. On June 30,2009, NIGC Field Investigator Gary Peterson contacted a 

confidential informant (CI), who is a Yakama Tribal member. The CI 

confirmed receipt of a check from the Yakama Tribe for $2,000 in 

December 2008. The CI further stated that in March 2009 the Tribe 

provided an IRS FORM 1099 for the $2,000 dishbution, which 

required the filing of an amended tax return as the FORM 1099 had not 

been sent in a timely manner. 

R Therefore, the Yakmu Nation made per capita payments from Yakama 

Legends Casino net gaming revenue to ali enrolled Yakama Nation 

members on or ahout December 19,2008 without an approved revenue 

allocation plan in violation of IGM, 25 U.S,C. 2710@)(3). 

S. Moreover, the Yakarna Nation made thts money distribution to each of the 

approximately 10213 enrolled Yakama Tribal members outside a bona 

fide government program. The payments were made without: directions or 

restrictions as to how thc money was to bc used; criteria for eligbdity 

beyond enrollment as a tribal member; a atrect relationsQ to an identified 

tribaI need; and an explanation as to how the drstribution would advance 

or address that necd. See AR Exhrbit No. 4, NIGC Bulletin No. 2005-2, 

"Use of Net Gaming Revenues," January 18,2005. 

T. Pursuant to IGRA, in the absence of an approved revenue allocation plan, 

gaming revenues may be wscd ody in ways hat benefit the tribe as a 

whole. The statutory restrictions on use cannot be avoided by simply 

calhg the hstribution an "economic scienulus" payment. It is 

impermissible for a tribc to make direct payments to inhvidual tribal 
members xvithout an approved RAP, outside of a bona fide government 

program. 25 U.S.C. 5 27 10(b) (2) Q3) ; @) (3); Ross v. PIandmau Sa~tec Sionx 

Tde, 809 F. Supp. 738 (S.D.S.D. 1992); AR Exhibit No. 4, NTGC Bulletin 

No. 2005-1, "Use of Net Gaming Revenues," J aanuary 18,2005. 

U. Therefore, the drstribution on or about December 18,2008 of $2,000 to 

each Nation member does not qua& as a legitimate use of net gaming 

revenue. ConsequentEy, the &strhution is a siolation of IGRA, 25 U.S.C. 

5 2710@)(2)@3) and the Tribe's Gaming Ordinance. Yak- In& 

Nation Garning Ordinance of 1 994,s 7 "Gaming Revenues". 

6. Measures Required to Correct the Violation 

There is na remedial action that can correct the 2008 per capita dtstribution of 

net gaming revenues made to the Nation's tribal members in the absence of an 

approved revenue allocation plan. Moreover, the 2008 distribution of $2,000 to 

each Nation member does not qualify as a legitimate use of net gaming revenue 

for the purposes of a bona fide government program, to provide for the general 

welfare of the Nation, or to promote economic development, To that end, there 

is no rernedd action that can correct hs misuse of net gaming revenue. 

7. Appeal 

Within thrrg (30) days after service of hs Notice of Violation, The Nation may 

appeal to the Commission under 25 C.F.R. Part 577 by submitting a notice of 

appeal, and, if desired, request for hearing to the National Indian Gaming 

Commission, 1441 L Street, NW, Ninth Floor, Washington, DC 20005. The 

Nation has a right to assistance of counsel in such an appeal. A notice of appeal 

must reference this Notice of Violation. 

Within ten (1 0) clays after hling a notice of appeal, the Nation must frle with the 

Commission a supplemental statement that states with particularity the relief 

desjxed and the grounds therefore and that includes, when available, supporting 

evidence in the form of affidavits. If the Nation wishes to present oral testimony 

ox wimesses at the hearing, the Nation inust indude a request to do so with the 

supplemental statement. The request to present oral testimony or witnesses 

must specify the names of proposed witnesses and the general nature of their 

expected testimony, whether a closed hearing is requested and why. The Nation 

may waive its right to an oral heating and instead elect to have the matter 

determined by the Commission sojely on the basis of written submissions. 
8. Fine-Submission of Infarmation 

The violation cited above may result in the assessment of a cid he against 

Nauon in an amount not to exceed $25,000 per violation per day. Under 25 

C.F.R. 5 575.5(a), the Nation may submit witten information about the violation 

to the Chahn within fifteen (15) days after service of this notice 05 violation 

the Chairman may grant for good cause). The 

any lnformntion submitted in determining the facts 

and the amount of the civil he, if any. 

Senior Attorney W 
I certify that this Notice of Violation wa sent by facsimile transmission and certified U.S. 

53 mail, return receipt requested, on hs 1 day of September, 2009 to: 

Roger Fiander, Chairman of the Yakama Nation Gaming Commission (Agent for 

Service of Process) 

580 Fort Road 

Toppcnish, WA 98948 

]:ax: 509-865-7867 

Ralph Sarnpson,Jr., Chairman of the Yakama Nation Tribal Council 

140 Fort Road 

Toppenish, WIZ 98948 

Fax: 509-865-5528 

Wallace YalEup, Chaimmn of the Yakama Nation Tribal Gaming Corporauon 

580 Fort Road 

Toppenish, WA 98948 

Fax: 509-856-5528 

1L~PA ., 

Dena Wynn 4