Letter to Chairwoman Stevens
February 11, 2011
Page 4

drafting regulations before they are noticed for comment in the Federal Register. The
preparation of thoughtful comments and proposed revisions to regulations is an important
consideration for ensuring that individual tribal concerns are adequately addressed in the process.

B. Sole Proprietary Interest Regulation

The Tribe is concerned that the sole proprietary interest requirement as interpreted by the
NIGC is confusing and that the NIGC’s past determinations regarding the application of the sole
proprietary interest requirement are difficult to apply to new contracts. The Tribe believes that
the NIGC should reexamine the legal foundation for the requirement and the NIGC’s previous
interpretations of the requirement. In that reexamination, the NIGC should take into account the
rights to Tribal governments to exercise their independent judgment in relation to the operation
of their gaming enterprises and the general uncertainty which the requirement creates in the
marketplace.

Depending on the outcome of that reexamination, the NIGC should consider adopting
regulations or other guidance which clarifies the criteria and methodology which will be used in
determining whether the sole proprietary interest doctrine is violated, as well as the process
whereby the tribe or its contractors can submit agreements to the NIGC for review. In the
absence of specific written guidance, the requirement has a chilling effect on the ability of a tribe
to negotiate and enter into contracts.

In the event the NIGC elects not to issue regulations regarding the sole proprietary
interest requirement, it should nevertheless take some action which provides guidance to tribes
and contractors regarding the NIGC’s current interpretation of the requirement.

We wish to thank the NIGC for the opportunity to submit these comments.

Sincerely, 7
y, tk y Ag C de a
/, nyt
{ Tribal Chairwoman



ROTH PORE RANCHERIA
OF MONO INDIANS OF CALIMORATA

TRIBAL GOVERNMENT OFFICE
P.O, Box 929

North Fork, CA 93643-0929
(559) 877-2461

Fax (559) 877-2467
1-866-291-9909

February 11, 2011

Ms. Tracie Stevens, Chairwoman
National Indian Gaming Commission
1441 L St., N.W., Ste. 9100
Washington, D.C. 20005

Re: Response to Notice of Inquiry dated November 18, 2010

Dear Chairwoman Stevens:

The North Fork Rancheria of Mono Indians is pleased to submit the following comments
in response to the Notice of Inquiry published by the National Indian Gaming Commission on
November 18, 2010.

In general, in conducting its regulatory review, we believe that the NIGC should consider
the statutory basis for the NIGC’s policies and regulation and amend those which are not clearly
supported by the Indian Gaming Regulatory Act IGRA). The NIGC also should avoid
initiatives that would expand its jurisdiction and regulatory oversight role beyond the authority
which is specifically granted in IGRA. Further, in many instances, the NIGC has adopted
policies, practices and procedures which are not clearly set forth in current NIGC regulations,
bulletins or other guidance. The NIGC should amend its regulations or issue bulletins or other
guidance so that information regarding NIGC current practices and requirements is more easily
available to tribes and the Indian gaming industry generally.

Our comments below are provided in the order presented in the Notice of Inquiry.

IV. Regulations Which May Require Amendment or Revision
A. Part 502—Definitions of this Chapter

(1) Net Revenues. The regulatory definition of “net revenues” was changed in the last
revision of Part 502 in a manner which does not track the definition of “net revenues” as set forth
in IGRA (25 U.S.C. § 2703(9)). Also, the definition of “net revenues” in IGRA does not appear
to be consistent with the generally accepted accounting principle (GAAP) definition of “net


Letter to Chairwoman Stevens
February 11, 2011
Page 2

income.” Therefore, if the NIGC decides to amend the regulatory definition of the term “net
revenue,” the regulatory definition should be conformed to the statute and any effort to
incorporate generally accepted accounting principles into the definition should be undertaken
only to the extent those principles are not inconsistent with the statutory definition of “net
revenues.”

(2) Management Contract. The definition of management contract should not be
expanded to include any contract, such as slot lease agreements, which pays a fee based ona
percentage of revenues. An equipment lease agreement does not become a management contract
simply because the compensation is derived as a percentage of revenue. Unless the contract
involves the “management” of a gaming activity, it is by definition not a “management contract”
requiring NIGC approval according to NIGC’s current regulations. Further, we agree with the
views of other tribes that expanding the number and type of gaming-related contracts that require
NIGC approval would be grossly inefficient and impact the ability of tribes to effectively
respond to the proposals of prospective business partners or the marketplace generally.

B-D. Parts 514, 518, and 523

Other tribal comments sufficiently address these issues.

E. Management Contracts
(ep) Part 531 — Collateral Agreements

The NIGC seeks comments on whether it should approve collateral agreements to
management contracts. The Tribe recommends that the NIGC continue its current policy of
requiring the submission of all collateral agreements to a management contract so that the NIGC
has visibility over all contractual relationships between a tribe and its management contractor.
However, the Tribe does not recommend that the NIGC change its regulations or previous
interpretations of IGRA to require that collateral agreements must be approved by the
Chairwoman in order to be legally effective. Ifthe NIGC were to change its regulations or
interpretations in this regard, the NIGC would inadvertently discourage private investment in
Indian Country by casting doubt over the enforceability of collateral agreements and other
agreements between tribes and its business partners.

(2) Part 533 — Approval of Management Contracts
Adding Grounds for Disapproval. The Tribe does not consider it appropriate or useful to

add two additional grounds for the disapproval of management contracts. IGRA (at 25 U.S.C.
§ 2711(e)) and the regulations (at 25 CFR 5§ 33.6(b)) specify four grounds for disapproving a



Letter to Chairwoman Stevens
February 11, 2011
Page 3

gaming management contract. The NIGC should not expand the statutorily prescribed list by
adding a fifth and sixth reason for disapproving a management contract. Rather, the NIGC
should continue its current practice of advising the tribe and the management contractor why the
management contract and/or submission package does not satisfy the NIGC’s requirements and
providing the tribe and the management contractor with the opportunity to correct the
deficiencies.

General Updates to Management Contract Regulations. More generally, the Tribe notes
that the regulations which govern the management contract approval process (25 CFR §§ 531,
533, 535, 537 and 539) were issued in 1993 and have remained unchanged since that time except
for minor modifications in 2008. The Tribe recommends that the NIGC update the management
contract regulations so that they conform more closely to the NIGC’s current policies and
procedures.

By updating the regulations, the NIGC could reduce the amount of time the NIGC, tribes,
and management contractors need to invest in communicating and discerning the current NIGC
requirements. Also, tribes and management contractors would be better able to prepare initial
contract drafts and submission packages which more closely confirm to what the NIGC staff is
willing to accept and the Chairwoman would be willing to approve.

While the Tribe recognizes that there are other regulations which should also be high
priorities for the NIGC, the Tribe believes that amending the regulations relating to the approval
of management contracts should be included within the list of the NIGC’s top regulatory
priorities. Management contracts represent new private investment in Indian Country, and their
approval by the Chairwoman is a key component of IGRA. Yet, too often, investors shy away
from management contracts and enter into other types of agreements with tribes because of the
uncertainty, time, and expense of securing approval of management contracts. Updating the
regulations could go a long way toward reversing these trends.

F-K. Parts 539, 542, 543, 547, 556, 559, 571, 573, and 577

Other tribal comments sufficiently address these issues.

Vv. Potential New Regulations
A. Tribal Advisory Committee

The NIGC has limited time to develop regulations in the areas it decides to address. Ifa
tribal advisory committee is deemed likely to expedite the process of preparing and issuing draft
regulations for comment, then an advisory committee should be used. If not, the NIGC should
consider other mechanisms for receiving input from tribes and other experts in the process of