31 July 2017

Jonodev Chaudhuri, Chairman
National Indian Gaming Commission
1849 C Street NW

Mail Stop #1621

Washington, D.C. 20240

Re: Comments on 25 C.F.R. Part 547.5 Discussion Draft
Chairman Chaudhuri:

The National Tribal Gaming Commissioners & Regulators (NTGCR) welcomes the
opportunity to comment on the “25 C.F.R. Part 547.5 Discussion Draft” published by the
National Indian Gaming Commission (NIGC) on 14 June 2017. As you are aware, the
NTGCR is a non-profit organization representing over sixty (60) tribal gaming regulatory
agencies across the country, dedicated to the advancement of tribal gaming regulators.
As part of its purpose, the NTGCR promotes the exchange of thoughts, information and
ideas which foster regulatory standards and enforcement that lead to consistent
regulatory practices and methods of operations among the NTGCR members and may act
as a gaming regulatory advisory group to tribal gaming organizations and others. It is
under these auspices that the following comments are offered.

The NTGCR has provided the NIGC with oral remarks at consultation hearings held
earlier this year on the subject of revisions to the grandfather provisions contained in
Section 547.5(a). Upon reviewing the Discussion Draft, the NTGCR was pleased to see
similar requirements across multiple sections being combined into more comprehensive
standards, thus reducing the overall length of the regulation. The revised standards more
clearly state the goals tribal gaming regulators and the NIGC seek to achieve.

These improvements are augmented by the NIGC’s decision to remove the sunset

provision, which has been a source of concern for the Class I] gaming industry. As noted
in our oral presentation during the consultation held in March, the NTGCR is unaware of

SERVING THE PRIMARY REGULATORS OF INDIAN GAMING


NTGCR Comments on 547 Discussion Draft

31 July 2017
Page 2 of 3

any Class II gaming system being compromised in the past ten (10) years since the
technical standards were adopted. This statement is extremely significant in that it
covers the operation of tens of thousands of Class II gaming devices across all tribal
jurisdictions and stands as testimony to the effective role tribal gaming regulators play in
ensuring compliance with the established standards.

By eliminating the sunset provision, the NIGC will relieve all Class II gaming tribes of the
considerable financial burden and negative economic impact that would have been
associated with the removal of grandfathered systems. In doing so, the NIGC has helped
tribes retain millions of dollars that would have otherwise been spent on resources to
remove and replace machines, as well as lost revenue resulting from the conversion
process. These funds can now be used for their intended purpose - to benefit of our
respective tribal members.

The provision contained in Section 547.5 (a)(2)(iii), however, presents a challenge for
tribal gaming regulators as it appears to require every Class II gaming system to be tested
on an annual basis. This will require a dramatic increase in regulatory testing efforts and
associated costs, the benefits of which cannot be determined by the existing language.
The proposed language seems to contradict the past position of the NIGC wherein it
recognized the industry standard of 10% annual testing to be sufficient to meet its
standards.

Similarly, the annual reporting requirement creates an unnecessary administrative
obligation on all tribal gaming regulators and the NIGC alike. Additionally, Tribes closely
evaluate all activities associated with Class I] gaming systems, including examining
independent test laboratory certification letters that accompany a submission. Coupled
with the record keeping requirements - for types of data and length of retention -
contained in other portions of Section 547, the provisions of the NIGC Minimum Internal
Control Standards, and the 10% annual testing, compliance with the technical standards
can clearly be demonstrated.

Rather than increasing the administrative burden on both tribal gaming regulators and
the NIGC, the NTGCR recommends the NIGC keep with its practice of accessing tribal
gaming data via written request to the tribal gaming regulatory agency.


NTGCR Comments on 547 Discussion Draft
31 July 2017
Page 3 of 3

Further, the standard is confusing in that it could be interpreted to require tribes to re-
certify existing approved Class II gaming systems and to submit such recertification to the
NIGC as a result of the revised rule. If this is, in fact, the intent, the standard should be
more clearly stated and consideration given to the cost/benefit of such activity.

Finally, the NTGCR is concerned about the language contained in Section 547.5(g) -
Records. The language added in this subsection is, at best, unnecessary as it is
understood that the Indian Gaming Regulatory Act (IGRA) allows the NIGC to have
access to Class II gaming information that tribes hold to be confidential and that it may
only be used for lawful purposes ~ including assessing any future changes to technical
standards. This information, which is available to the NIGC at any time upon request, is
not generally made available to the public. It is, therefore, concerning that language is
added to the statute to allow for “records or portions of records” that a tribe may deem
sensitive to be publically disclosed, even after the NIGC exercises its best efforts to
restrict access to such data under the Freedom of Information Act. To safeguard against
the possibility of tribal specific proprietary information being disclosed, the NTGCR
recommends removing the second and third sentences of this subsection.

The NTGRC appreciates the opportunity to provide comments on proposed rules that will
affect tribes and the Class II gaming industry for years to come. Should you have any
questions, please contact me directly at either 918.207.3848 or via e-mail at

jhummingbird@cherokee.org.

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Hint ni Hn
Chairman