I
103D CONGRESS
1ST SESSION
H. R. 1624
To amend the Indian Gaming Regulatory Act, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 1, 1993
Mr. HOAGLAND (for himself, Mr. MACHTLEY, and Mr. STUMP) introduced the
following bill; which was referred jointly to the Committees on Natural
Resources and Ways and Means
A BILL
To amend the Indian Gaming Regulatory Act, and for other
purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. INDIAN GAMING RESTRICTED.
(a) REGULATION
OF CLASS II GAMING.—Section
11(b) of the Act (25 U.S.C. 2710(b)) is amended—
(1) in paragraph (1)—
(A) in subparagraph (A)—
(i) by inserting ‘‘(i)’’ after ‘‘(A)’’;
(ii) in clause (i), as designated by
clause (i) of this subparagraph, by striking
‘‘any purpose’’ and all that follows through
‘‘law), and’’ and inserting ‘‘a commercial
purpose by any person, organization or en-
tity, or’’; and
(iii) by inserting after clause (i), as
designated by clause (i) of this subpara-
graph, the following:
‘‘(ii) such Indian gaming is for charitable pur-
poses and is located within a State that permits
such gaming for charitable purposes by a person, or-
ganization or entity,’’;
(B) by redesignating subparagraph (B) as
subparagraph (D) and inserting the following:
‘‘(B) such gaming is not otherwise specifically
prohibited on Indian lands by Federal law,
‘‘(C) permissible gaming is limited to the spe-
cific forms of, and methods of play for, gaming ac-
tivities expressly authorized by the law of the State,
and’’; and
(2) in paragraph (2)—
(A) in subparagraph (E), by striking
‘‘and’’ at the end;
(B) in subparagraph (F), by striking the
period and inserting ‘‘; and’’; and
(C) by adding at the end the following:
‘‘(G) all gaming activities shall be conducted in
conformity with those laws and regulations (if any)
of the State regarding specific games allowed and
methods of play, including, but not limited to, peri-
ods of operation, limitation on wagers, pot sizes, and
losses.’’.
(b) REGULATION OF CLASS III GAMING.—Section
11(d)(1) of the Act (25 U.S.C. 2710(d)(1)) is amended—
(1) by amending subparagraph (B) to read as
follows:
‘‘(B) located in a State that permits such gam-
ing for any purpose by any person, organization, or
entity which conducts the authorized gaming activity
as part of a commercial, for-profit business enter-
prise; except that a Tribal-State compact may per-
mit any other class III gaming authorized by a State
if conducted in accordance with State law;’’; and
(2) by redesignating subparagraph (C) as sub-
paragraph (D) and inserting after subparagraph (B)
the following new subparagraph:
‘‘(C) limited to the specific forms of, and meth-
ods of play for, gaming activities expressly author-
ized by the law of the State; and’’.
SEC. 2. DEFINITION OF CLASS III GAMING.
Section 4 of the Act (25 U.S.C. 2703) is amended—
(1) in paragraph (7)(A)(i), by inserting after
‘‘therewith)’’ the following: ‘‘except video bingo’’;
and
(2) in paragraph (8), by inserting before the pe-
riod at the end the following: ‘‘including, but not
limited to, slot machines (as such term is defined in
subsection (a)(1) of the first section of the Act of
January 2, 1951 (Chapter 1194; 64 Stat. 1134)),
electronic or electromechanical facsimiles of any
game of chance, and any and all forms of electronic
video games or devices, such as video bingo, video
pull-tabs, video keno, and video blackjack’’.
SEC. 3. COMPACT NEGOTIATION.
(a) BURDEN OF PROOF.—Section 11(d)(7)(B)(ii) of
the Act (25 U.S.C. 2710(d)(7)(B)(ii)) is amended by
striking ‘‘burden of proof shall be upon the State to prove
that the State’’ and inserting ‘‘burden of proof shall be
upon the Indian tribe to prove that the State’’.
(b) CERTAIN EVIDENCE.—Section 11(d)(7)(B)(iii) of
the Act (25 U.S.C. 2710(d)(7)(B)(iii)) is amended—
(1) in subclause (I), by striking ‘‘, and’’ and in-
serting a semicolon;
(2) in subclause (II), by striking the period and
inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(III) except as provided in clause
(ii), shall not consider as evidence that the
State has not negotiated in good faith a
demand by the State that the gaming ac-
tivities contemplated by the compact be
conducted on the same basis as gaming ac-
tivities which may be conducted by any
other person or entity under the terms of
relevant State law.’’.
SEC. 4. NATIONAL INDIAN GAMING COMMISSION.
(a) ADDITIONAL MEMBERS.—Section 5(b)(1) of the
Act (25 U.S.C. 2704(b)(1)) is amended—
(1) in the material preceding subparagraph (A),
by striking ‘‘three’’ and inserting ‘‘five’’;
(2) in subparagraph (A), by striking ‘‘and’’;
(3) in subparagraph (B), by striking the period
at the end and inserting ‘‘; and’’; and
(4) by adding at the end the following:
‘‘(C) two associate members who shall be
appointed by the President, with the advice and
consent of the Senate, from among State offi-
cials.’’.
(b) COMPOSITION.—Section 5(b)(3) of the Act (25
U.S.C. 2704(b)(3)) is amended in the first sentence by
striking ‘‘two’’ and inserting ‘‘three’’.
(c) QUORUM.—Section 5(d) of the Act (25 U.S.C.
2704(d)) is amended by striking ‘‘two’’ and inserting
‘‘three’’.
(d) EFFECTIVE DATE; TRANSITION RULES.—(1) Ex-
cept as required for paragraph (2), the amendments made
by this section shall take effect at the end of the 90-day
period beginning on the date of enactment of this Act and
shall apply with respect to any action taken by the Na-
tional Indian Gaming Commission after the end of such
period.
(2) Not later than 90 days after the date of enact-
ment of this Act, the President shall make the initial ap-
pointments of the associate members of the National In-
dian Gaming Commission, as required by the amendments
made by subsection (a) of this section, in accordance with
the Indian Gaming Regulatory Act, as amended by this
Act.
SEC. 5. GAMING ON AFTER ACQUIRED LANDS.
Section 
20(b)(1)(A) 
of 
the 
Act 
(25 
U.S.C.
2719(b)(1)(A)) is amended—
(1) by striking ‘‘and appropriate State and local
officials, including officials of other nearby Indian
tribes,’’ and inserting the following: ‘‘, appropriate
State and local officials (including officials of other
nearby Indian tribes), and officials of other nearby
communities (including communities across State
borders that would be directly affected by gaming
conducted on such lands),’’; and
(2) by striking ‘‘community’’ and inserting
‘‘communities (including communities across State
borders that would be directly affected by gaming
conducted on such lands)’’.
SEC. 6. INDIAN EMPLOYMENT CREDIT.
(a) ALLOWANCE OF INDIAN EMPLOYMENT CRED-
IT.—Section 38(b) of the Internal Revenue Code of 1986
(relating to general business credits) is amended by strik-
ing ‘‘plus’’ at the end of paragraph (7), by striking the
period at the end of paragraph (8) and inserting ‘‘, plus’’,
and by adding after paragraph (8) the following new para-
graph:
‘‘(9) the Indian employment credit as deter-
mined under section 45A(a).’’.
(b) AMOUNT OF INDIAN EMPLOYMENT CREDIT.—
Subpart D of Part IV of subchapter A of chapter 1 of
such Code (relating to business related credits) is amended
by adding at the end thereof the following new section:
‘‘SEC. 45A. INDIAN EMPLOYMENT CREDIT.
‘‘(a) AMOUNT OF CREDIT.—
‘‘(1) IN GENERAL.—For purposes of section 38,
the amount of the Indian employment credit deter-
mined under this section with respect to any em-
ployer for any taxable year is 10 percent (30 percent
in the case of an employer with at least 85 percent
Indian employees throughout the taxable year) of
the sum of—
‘‘(A) the qualified wages paid or incurred
during such taxable year, plus
‘‘(B) qualified employee health insurance
costs paid or incurred during such taxable year.
In no event shall the amount of the Indian employ-
ment credit for any taxable year exceed the credit
limitation amount determined under subsection (e)
for such taxable year.
‘‘(2) INDIAN
EMPLOYEE.—For purposes of
paragraph (1), the term ‘Indian employee’ means an
employee who is an enrolled member of an Indian
tribe or the spouse of such a member.
‘‘(b) QUALIFIED WAGES; QUALIFIED EMPLOYEE
HEALTH INSURANCE COSTS.—For purposes of this sec-
tion—
‘‘(1) QUALIFIED WAGES.—
‘‘(A) IN
GENERAL.—The term ‘qualified
wages’ means any wages paid or incurred by an
employer for services performed by an employee
while such employee is a qualified employee.
‘‘(B) COORDINATION
WITH
TARGETED
JOBS CREDIT.—The term ‘qualified wages’ shall
not include wages attributable to service ren-
dered during the 1-year period beginning with
the day the individual begins work for the em-
ployer if any portion of such wages is taken
into account in determining the credit under
section 51.
‘‘(2) QUALIFIED
EMPLOYEE
HEALTH
INSUR-
ANCE COSTS.—
‘‘(A) IN
GENERAL.—The term ‘qualified
employee health insurance costs’ means any
amount paid or incurred by an employer for
health insurance to the extent such amount is
attributable to coverage provided to any em-
ployee while such employee is a qualified em-
ployee.
‘‘(B) EXCEPTION
FOR
AMOUNTS
PAID
UNDER SALARY REDUCTION ARRANGEMENTS.—
No amount paid or incurred for health insur-
ance pursuant to a salary reduction arrange-
ment shall be taken into account under sub-
paragraph (A).
‘‘(c) QUALIFIED EMPLOYEE.—For purposes of this
section—
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the term ‘qualified em-
ployee’ means, with respect to any period, any em-
ployee of an employer if—
‘‘(A) substantially all of the services per-
formed during such period by such employee for
such employer are performed within an Indian
reservation,
‘‘(B) the principal place of abode of such
employee while performing such services is on
or near the reservation in which the services are
performed, and
‘‘(C) the employee began work for such
employer on or after January 1, 1994.
‘‘(2) CREDIT
ALLOWED
ONLY
FOR
FIRST
YEARS.—An employee shall not be treated as a
qualified employee for any period after the date 7
years after the day on which such employee first
began work for the employer.
‘‘(3) INDIVIDUALS
RECEIVING
WAGES
IN
EX-
CESS OF $30,000 NOT ELIGIBLE.—An employee shall
not be treated as a qualified employee for any tax-
able year of the employer if the total amount of the
wages paid or incurred by such employer to such
employee during such taxable year (whether or not
for services within an Indian reservation) exceeds
the amount determined at an annual rate of
$30,000. The Secretary shall adjust the $30,000
amount contained in the preceding sentence for
years beginning after 1993 at the same time and in
the same manner as under section 415(d).
‘‘(4) EMPLOYMENT MUST BE TRADE OR BUSI-
NESS EMPLOYMENT.—An employee shall be treated
as a qualified employee for any taxable year of the
employer only if more than 50 percent of the wages
paid or incurred by the employer to such employee
during such taxable year are for services performed
in a trade or business of the employer. Any deter-
mination as to whether the preceding sentence ap-
plies with respect to any employee for any taxable
year shall be made without regard to subsection
(f)(2).
‘‘(5) CERTAIN
EMPLOYEES
NOT
ELIGIBLE.—
The term ‘qualified employee’ shall not include—
‘‘(A) any individual described in subpara-
graph (A), (B), or (C) of section 51(i)(1),
‘‘(B) any 5-percent owner (as defined in
section 416(i)(1)(B)),
‘‘(C) any individual who is neither an en-
rolled member of an Indian tribe nor the spouse
of an enrolled member of an Indian tribe, and
‘‘(D) any individual if the services per-
formed by such individual for the employer in-
volve the conduct of class I, II, or III gaming
as defined in section 4 of the Indian Gaming
Regulatory Act (25 U.S.C. 2703), or are per-
formed in a building housing such gaming
activity.
‘‘(6) INDIAN TRIBE DEFINED.—The term ‘In-
dian tribe’ means any Indian tribe, band, nation,
pueblo, or other organized group or community, in-
cluding any Alaska Native village, or regional or vil-
lage corporation, as defined in, or established pursu-
ant to, the Alaska Native Claims Settlement Act (43
U.S.C. 1601 et seq.) which is recognized as eligible
for the special programs and services provided by
the United States to Indians because of their status
as Indians.
‘‘(7) INDIAN
RESERVATION
DEFINED.—The
term ‘Indian reservation’ means a reservation, as de-
fined in—
‘‘(A) section 3(d) of the Indian Financing
Act of 1974 (25 U.S.C. 1452(d)), or
‘‘(B) section 4(10) of the Indian Child
Welfare Act of 1978 (25 U.S.C. 1903 (10)).
‘‘(d) EARLY TERMINATION OF EMPLOYMENT BY EM-
PLOYER.—
‘‘(1) IN GENERAL.—If the employment of any
employee is terminated by the taxpayer before the
day 1 year after the day on which such employee
began work for the employer—
‘‘(A) no wages (or qualified employee
health insurance costs) with respect to such em-
ployee shall be taken into account under sub-
section (a) for the taxable year in which such
employment is terminated, and
‘‘(B) the tax under this chapter for the
taxable year in which such employment is ter-
minated shall be increased by the aggregate
credits (if any) allowed under section 38(a) for
prior taxable years by reason of wages (or
qualified employee health insurance costs) taken
into account with respect to such employee.
‘‘(2) 
CARRYBACKS
AND
CARRYOVERS
AD-
JUSTED.—In the case of any termination of employ-
ment to which paragraph (1) applies, the carrybacks
and carryovers under section 39 shall be properly
adjusted.
‘‘(3) SUBSECTION NOT TO APPLY IN CERTAIN
CASES.—
‘‘(A) IN
GENERAL.—Paragraph (1) shall
not apply to—
‘‘(i) a termination of employment of
an employee who voluntarily leaves the em-
ployment of the taxpayer,
‘‘(ii) a termination of employment of
an individual who before the close of the
period referred to in paragraph (1) be-
comes disabled to perform the services of
such employment unless such disability is
removed before the close of such period
and the taxpayer fails to offer reemploy-
ment to such individual, or
‘‘(iii) a termination of employment of
an individual if it is determined under the
applicable State unemployment compensa-
tion law that the termination was due to
the misconduct of such individual.
‘‘(B) CHANGES IN FORM OF BUSINESS.—
For purposes of paragraph (1), the employment
relationship between the taxpayer and an em-
ployee shall not be treated as terminated—
‘‘(i) by a transaction to which section
381(a) applies if the employee continues to
be employed by the acquiring corporation,
or
‘‘(ii) by reason of a mere change in
the form of conducting the trade or busi-
ness of the taxpayer if the employee con-
tinues to be employed in such trade or
business and the taxpayer retains a sub-
stantial interest in such trade or business.
‘‘(4) SPECIAL
RULE.—Any increase in tax
under paragraph (1) shall not be treated as a tax
imposed by this chapter for purposes of—
‘‘(A) determining the amount of any credit
allowable under this chapter, and
‘‘(B) determining the amount of the tax
imposed by section 55.
‘‘(e) CREDIT LIMITATION AMOUNT.—For purposes of
this section—
‘‘(1) CREDIT LIMITATION AMOUNT.—The credit
limitation amount for a taxable year shall be an
amount equal to the credit rate (10 or 30 percent
as determined under subsection (a)) multiplied by
the increased credit base.
‘‘(2) INCREASED CREDIT BASE.—The increased
credit base for a taxable year shall be the excess
of—
‘‘(A) the sum of any qualified wages and
qualified employee health insurance costs paid
or incurred by the employer during the taxable
year with respect to employees whose wages
(paid or incurred by the employer) during the
taxable year do not exceed the amount deter-
mined under paragraph (3) of subsection (c),
over
‘‘(B) the sum of any qualified wages and
qualified employee health insurance costs paid
or incurred by the employer (or any prede-
cessor) during calendar year 1993 with respect
to employees whose wages (paid or incurred by
the employer or any predecessor) during 1993
did not exceed $30,000.
‘‘(3) SPECIAL
RULE
FOR
SHORT
TAXABLE
YEARS.—For any taxable year having less than 12
months—
‘‘(A) the amounts paid or incurred by the
employer shall be annualized for purposes of de-
termining the increased credit base, and
‘‘(B) the credit limitation amount shall be
multiplied by a fraction, the numerator of which
is the number of days in the taxable year and
the denominator of which is 365.
‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.—
For purposes of this section—
‘‘(1) WAGES.—The term ‘wages’ has the same
meaning given to such term in section 51.
‘‘(2) CONTROLLED GROUPS.—
‘‘(A) All employers treated as a single em-
ployer under section (a) or (b) of section 52
shall be treated as a single employer for pur-
poses of this section.
‘‘(B) The credit (if any) determined under
this section with respect to each such employer
shall be its proportionate share of the wages
and qualified employee health insurance costs
giving rise to such credit.
‘‘(3) CERTAIN OTHER RULES MADE APPLICA-
BLE.—Rules similar to the rules of section 51(k)
and subsections (c), (d), and (e) of section 52 shall
apply.
‘‘(4) 
COORDINATION
WITH
NONREVENUE
LAWS.—Any reference in this section to a provision
not contained in this title shall be treated for pur-
poses of this section as a reference to such provision
as in effect on the date of the enactment of this
paragraph.’’.
(c) DENIAL OF DEDUCTION FOR PORTION OF WAGES
EQUAL TO INDIAN EMPLOYMENT CREDIT.—
(1) Subsection (a) of section 280C of such Code
(relating to rule for targeted jobs credit) is amended
by striking ‘‘51(a)’’ and inserting ‘‘45A(a), 51(a),
and’’.
(2) Subsection (c) of section 196 of such Code
(relating to deduction for certain unused business
credits) is amended by striking ‘‘and’’ at the end of
paragraph (4), by striking the period at the end of
paragraph (5) and inserting ‘‘, and’’, and by adding
at the end the following new paragraph:
‘‘(6) the Indian employment credit determined
under section 45A(a).’’.
(d) DENIAL OF CARRYBACKS TO PREENACTMENT
YEARS.—Subsection (d) of section 39 of such Code is
amended by adding at the end thereof the following new
paragraph:
‘‘(4) NO CARRYBACK OF SECTION 45A CREDIT
BEFORE
ENACTMENT.—No portion of the unused
business credit for any taxable year which is attrib-
utable to the Indian employment credit determined
under section 45A may be carried to a taxable year
ending before the date of the enactment of section
45A.’’.
(e) CLERICAL AMENDMENT.—The table of sections
for subpart D of part IV of subchapter A of chapter 1
of such Code is amended by adding at the end thereof
the following:
‘‘Sec. 45A. Indian employment credit.’’.
(f) EFFECTIVE DATE.—The amendments made by
this section shall apply to wages paid or incurred after
December 31, 1993.
Æ
HR 1624 IH——2