Mike Faith
Chairman
TRIBAL COUNCIL John Pretty Bear
{AT LARGE) Cannonball District

Brandon Mauai

Paul Archambault Long Soldier District

Ira Taken Alive
Vice Chairman

Susan Agard Wayne Looking Back

FankWaiaieul Secretary Wakpala District
Delray emery
Kenel District

Courtney Yellow Fat

Kory McLaughlin Joe White Mountain Jr.

Bear Soldier District

Charles Walker Caroline Thompson
Rock Creek District

Dana Yellow Fat Verdell Bobtail Bear
Running Antelope District

January 23, 2018 Samuel B. Harrison

Via Hand Delivery Porcupine District

Jonodev Chaudhuri, Chairman National Indian Gaming Commission
C/O Department of the Interior

1849 C Street NW, Mail Stop # 1621

Washington, D.C. 20240

Re: Standing Rock Sioux Tribe Comments on Audit Submissions and Management
and Sole Proprietary Interest

Dear Chairman Chaudhuri:

The Standing Rock Sioux Tribe (“Tribe”) respectfully submits these comments in
response to the National Indian Gaming Commission (“NIGC”)’s consultation topics for its
meeting of January 23, 2018 at Prairie Winds Casino Hotel in Oglala, South Dakota. As
requested, the Tribe hereby submits input on NIGC’s contemplated amendments regarding
audit submissions and standards for what constitutes management and sole proprietary
interest.

In 1988, Congress established through enactment the “Indian Gaming Regulatory
Act,” that Indian Tribes, as governments, have the right to regulate and manage gaming
operations on their respective reservations. It also provided a comprehensive regulatory
system that involves three (3) levels of government regulation: tribal, federal and state.
Through President Obama’s Executive Memorandum of November 5, 2009 and Executive
Order 13175, the President reaffirmed tribal rights to consultation before policies or
guidance would be adopted that have tribal implications.

AUDIT SUBMISSIONS

The Tribe wholeheartedly appreciates ~ and supports — the Commission’s stated
belief that small charitable gaming operations are burdened not only by requirements to


obtain audited financial statements for submission to the NIGC, but the cost of a CPA
review as well. The Tribe wishes to stress its support for the NIGC’s stated belief that “the
smallest gaming operations would be exempted from the annual financial statement
submission requirement” altogether.

With the Tribe working through an unprecedented budget that further restricts what
our government is able to do for the most vulnerable among us, our members rely more
than ever on creative and community-based opportunities to meet their needs. Small gaming
operations on the Standing Rock Reservation work with a purely charitable mind to help
ensure our youth are able to experience enrichment in cultural and scholastic arenas, our
elderly members are able to afford transportation to appointments and our members who
are pulling themselves up from historic poverty levels will not be felled by the lack of basic
needs. These operations, while serving a vital purpose to our people, raise funds at a level
where any required, formal review or certification would prove not only burdensome but
fatal. The people who run these operations do so with no incentive but helping their
neighbors at the most local of levels; saddling volunteers - who run such programs purely
from their heart and not from a bank account - with such expenditures runs the risk of
eradicating these opportunities altogether.

The Commission’s suggestion of raising the reviewed financial statement limit to
three (3) million dollars gives the Tribe encouragement that the NIGC is well-aware of the
need to meet the shifting realities of economic issues on the reservations, and will act with
similar reason and pragmatism with the limit under which small gaming operations would
be exempted from annual financial statement submissions altogether. While the Tribe
cannot speak for some of our more financially-stable friends and relatives in Tribes across
the country, we believe the barometer for exempted operations should be set as high as
possible to accommodate both those other Tribes, as well as the more modest operations
being run for our friends and relatives here at home.

MANAGEMENT AND SOLE PROPRIETARY INTEREST

NIGC proposes regulations setting out standards for what constitutes management
and sole proprietary interest. It appears this distinction has become an issue due to the use
of professional managers by Tribes under agreements, and how that use may blur the line
between Tribes who must have the sole proprietary interest in its gaming establishment(s)
and those who manage such establishments.

The Tribe wishes to encourage the NIGC to include in its consideration of this issue
that many Tribes — such as the Standing Rock Sioux Tribe — do not enter into such
agreements, but alternatively hires individuals — much like any other employee — to perform
managerial functions at its Class III establishments. This distinction is carved into the
Tribe’s laws at Title 23, Chapters 4 and 5 of the Standing Rock Sioux Tribal Code of
Justice. Specifically, Chapter 4 delineates requirements for any hypothetical applicant, not
the Tribe itself, who seeks — or is awarded — a facility license.! Meanwhile, Chapter 5 speaks

+ Hypothetical, because on the Standing Rock Sioux Reservation, management is hired as employees, and is not a
separate entity with a tribal license.


to Management Personnel — like those individuals hired by the Tribe — who are governed by
the same licensing standards as any other employee of a Class III gaming enterprise on the
Reservation.

These are obviously distinct roles for distinct forms of management. While this
distinction may appear obvious given the nature of what the NIGC is currently
contemplating, the Tribe urges NIGC to ensure that distinction is clear both in the
development of regulations and in the language of any regulations themselves, as the
different forms of “management” may lead to confusion. For example, Chapter 4
management entities are often described as having management agreements, while Chapter
5 managers may be employed through a management contract that nevertheless governs
them as employees. Those lines themselves may blur to the casual observer.

Therefore, the Tribe requests the NIGC develop regulatory language that clearly
distinguishes between management compensated by percentage of profit and management
compensated by salary. Managerial employees — like those operating at Standing Rock
casinos, who are licensed like other non-managerial employees — do not blur the line of the
Tribe's proprietary interests as might a management firm with its own tribal facility license,
nor trigger NIGC requirements specific to the latter under 25 CFR 531. To ensure the
continued smooth operation of establishments owned by the Tribe, which employs
management rather than licenses to a management entity, the Tribe respectfully urges the
NIGC to resist any potential confusion that could arise.

CONCLUSION

On behalf of the Standing Rock Sioux Tribe, we appreciate this opportunity to
provide comments to the NIGC. The Tribe looks forward to working with the NIGC as
these important matters move forward. Please do not hesitate to contact us if we can
provide any additional assistance or information.

Sincerely, —

[UDP f. cL —
Mike Lan Chairman
Standing Rock Sioux Tribe