DENTONS 2 Drummond ATTORNEYS AT LAW October 31, 2017 The Honorable James Cason Associate Deputy Secretary US. Department of the Interior 1849 Street Northwest Washington D.C. 20240 Re: Publication of Deemed Approved Amendments to the a as a cket Pe acts Dear Secretary Cason: We write on behalf of the Mohegan Tribe of Indians of Connecticut and the Mashantucket Pequot Tribe (the "Tribes") to thank you for meeting with us on October 26, 2017, to discuss our request, in which the State of Connecticut joined, that the Department of the Interior ("Department") publish notice in the Federal Register that amendments to the Mohegan and Mashantucket Pequot Class Compacts1 and the Memoranda of Understanding between the Tribes and the State (together, the "Amendments") are considered to have been approved, as required by Section 11(d) of the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. 2710(d)(8)(D) and its implementing regulations. During our meeting, you suggested that we provide a legal analysis of why such a notice must be published and address a concern Secretary Zinke raised with you regarding whether he has the legal authority to approve the Amendments. We address these issues below, after ?rst providing some background information. 1 The Mohegan Tribe operates Class gaming in Connecticut in accordance with a Tribal?State gaming compact that was approved by the Secretary, as published in the Federal Register at 59 Fed. Reg. 65,130 (Dec. 16, 1994). The Mashantucket Pequot Tribe operates Class gaming in Connecticut in accordance with a Tribal?State gaming compact that was selected by a mediator and subsequently adopted as procedures by the Secretary, as published in the Federal Register at 56 Fed. Reg. 24,996 (May 31, 1991). Throughout this letter, they are together referred to as the "Compacts?. Associate Deputy Secretary James Cason October 31, 2017 Page 2 Statutory and Regulatory Framework IGRA authori2es Class gaming on Indian lands if ?conducted in conformance with a Tribal State compact entered into by an Indian tribe and the State. . .that is in effect,? or conducted in conformance with equivalent procedures promulgated by the Secretary. 25 U.S.C. 2710(d) 2710(d)(7)(B) (vii) IGRA allows the Secretary only two options once a compact has been submitted for review he must either af?rmatively approve, or af?rmatively disapprove, within 45 days of receipt. 25 U.S.C. IGRA allows the Secretary to disapprove a compact for only three reasons, 123., only if the compact violates any provision of (ii) any other provision of federal law that does not relate to jurisdiction over gaming on Indian lands; or the trust obligations of the United States to Indians. 25 U.S.C. 2710(d)(8)(B). IGRA further requires that if the Secretary neither approves nor disapproves a compact, it is deemed approved to the extent that it is consistent with IGRA 45 days after its submission to the Secretary. 25 U.S.C. 2710(d)(8) (C). Finally, IGRA requires the Secretary to publish in the Federal Register notice of approvals (including deemed approvals) in order to make them effective. 25 U.S.C. 2710(d) The Department has promulgated regulations governing the approval of compacts that also govern the review and approval of compact amendments. See 25 C.F.R. Part 293. These regulations treat the processing of compacts for approval in a virtually identical fashion, and (unsurprisingly) rely on the same statutory authority described above (25 U.S.C. 2710(d)(8) (A), (B), and for each. See Final Rule, Class Tribal State Gaming Compact Process, 73 Fed. Reg. 74004 (December 5, 2008). The Substance of the Mohegan Mashantucket Pequot Amendments The Amendments entered into by the State of Connecticut (the ?State?) and the Tribes to the existing Compacts reflect the parties' negotiated agreements with one another that enactment of State legislation -- authorizing a state?regulated casino located on off?reservation land and operated as a business entity jointly and exclusively owned by the Tribes does not alter or interfere with the parties' existing obligations to each other relating to the Tribes' IGRA-based gaming on their reservations, as those obligations are spelled out in the Compacts. More speci?cally, the Amendments make clear that the parties agree that the State legislation does not serve to lift the moratorium on the operation of video facsimile games on which the parties originally agreed in Section 15 of their respective Compacts. The Amendments do not and could not ?authorize? off reservation commercial casino gaming in the State. Only the State can do so. The only connection is the fact that the Compacts have a moratorium provision related to the enactment of certain possible State laws that might allow expanded gaming in the State; and that provision is being amended to af?rm that the enactment of Associate Deputy Secretaryjames Cason October 31, 2017 Page 3 the State Act (as de?ned below) will not impact the moratorium and obligations of the parties under their current agreements. State Law Requirements Public Act No. 17-89, approved on June 27, 2017 (the ?State Act"), establishes a regulatory structure and process applicable to any commercial casino gaming facility within the State that the legislature chooses to authorize. The State Act also authorizes the operation of a commercial casino gaming facility in the Town of East Windsor by MMCT Venture, LLC (a limited liability company jointly and exclusively owned by the Mohegan Tribe and Mashantucket Pequot Tribe) subject to the approval of the Amendments by the Connecticut General Assembly and the Deparmaent. Section 14(c)(1) of the State Act requires the Amendments to "include a provision that the authorization of [the limited liability company], to conduct authorized games in the state does not terminate the moratorium against the operation of video facsimile games by [the Tribes] on each tribe's reservation." In addition, Section 14(c)(2) of the State Act explicitly requires that the State's authorization to conduct commercial casino gaming activities by the Tribes shall not be effective unless the Amendments "are approved or deemed approved by the Secretary of the United States Department of the Interior pursuant to and its implementing regulations." Consultation with the Department In 2015, the Tribes and the State began to consider amending their Compacts to af?rm that the Tribes' joint ownership and operation of a commercial casino gaming facility outside the Tribes' Indian lands would not alter or compromise the Tribes' existing IGRA agreements with the State. The Tribes twice formally requested and received technical assistance from the Department. Noting the ?unique circumstances of the [Tribes] and the State,? on April 25, 2016, the Acting Assistant Secretary for Indian Affairs examined the proposed amendment and found that ?the [Tribes?] existing exclusivity arrangement would not be affected by a new State-authorized casino that is jointly and exclusively owned by both the [Tribes].? April 25, 2016 Letters of Lawrence Roberts, Acting Assistant Secretary Indian Affairs, to the Hon Rodney Butler, Chairman, Mashantucket Pequot Indian Tribe, and the Hon. Kevin Brown, Chairman, Mohegan Tribe of Indians of Connecticut. Subsequently, on May 12, 2017, Acting Deputy Secretary James Cason specifically outlined the limited scope of the Department?s review of compact amendments as described herein and stated that the Department?s goal in reviewing a compact amendment is to be sure it does not violate any provision of IGRA or is inconsistent with another compact provision. That letter also con?rmed that "the current Administration supports the views expressed in the [April 25, 2016] technical assistance letter" and that the Department?s practice is not to disturb longstanding compacts when reviewing amendments to underlying agreements. May 12, 2017, Letters of James Cason, Acting Deputy Secretary, to the Hon. Kevin Brown, Chairman, Mohegan Tribe, and the Hon. Rodney Butler, Chairman, Mashantucket Pequot Indian Tribe. Associate Deputy Secretaryjames Cason October 31, 2017 Page 4 Neither technical assistance letter indicated or even implied nor did the Department otherwise ever indicate that consideration of the proposed amendments would be "premature and likely unnecessary," or that there was "insufficient information upon which to make a decision as to whether a new commercial casino operated by the Tribes would or Would not violate the exclusivity clauses of the Tribes' Compact/Procedures," as suggested in the Department's September 15th letters discussed below. Relying on these letters, as well as multiple meetings and telephone calls with Departmental personnel throughout this period, both the Amendments and the State Act were carefully drafted to take into account any concerns raised by the Department throughout the process. The Department received the Amendments on August 2, 2017. During the 45-day review period, Departmental of?cials repeatedly assured representatives of the Tribes that approval of the Amendments would be forthcoming by September 15, 2017. At no time during the review period did the Department ask for further information or suggest that consideration of the Amendments was premature or unnecessary. It was only on September 14th that representatives of the Tribes were informed that the Department had inexplicably changed course and no longer planned to issue an approval. The Department's September 15 Letters The 45-day review period for the Amendments expired on September 15, 2017. On that date, the Tribes and the State each received a letter from Acting Assistant Secretary for Indian Affairs Michael S. Black purporting to "return" the amendments, ostensibly because the Department considered the Amendments "premature and likely unnecessary," and because there was "insuf?cient information" to determine whether the exclusivity provisions of the Tribes' Compacts would be breached by a new commercial casino gaming facility owned and operated by the Tribes outside of their Indian lands. The Tribes were both surprised and deeply concerned about the September 15th letters. First, contrary to the Acting Assistant Secretary's statement, the Amendments are not premature, as they have been executed by the Tribes and the State and approved by the General Assembly of the State. Second, the Amendments are not "unnecessary", but rather have been agreed to by the State and the Tribes as necessary to affirm that enactment of State law allowing the Tribes? business entity to conduct gaming in the State would not lift the moratorium in Section 15 of the Compacts. More fundamentally, it is not the Department?s province to speculate about whether a compact amendment is ?necessary?. IGRA and its implementing regulations allow the Department only two options: to approve a compact amendment; or to deny it if such amendment violates the provisions set forth in 25 U.S.C. These particular Amendments clearly do not violate the provisions of 25 U.S.C. Associate Deputy Secretary James Cason October 31, 2017 Page 5 There is no question regarding the Secretary's jurisdiction to approve the Amendments. The Amendments con?rm that the existing moratorium on video facsimile machines described in the Compacts is not disturbed by the enactment of State law allowing the joint ownership and operation of a commercial casino gaming facility by the Tribes. The Amendments in no way authorize the operation of the commercial casino gaming facility by the Tribes; that is a matter left to State law.2 In addition, in the nearly 30 years since IGRA was enacted, neither the Department nor the National Indian Gaming Commission (which has authority to enforce requirements) has ever taken the position that tribes legally operating commercial gaming facilities under state law are somehow ?circumventing? IGRA or its requirements for tribal gaming on newly acquired trust or restricted fee lands no doubt because there is absolutely nothing in IGRA or its implementing regulations that would justify such a position. IGRA governs gaming on Indian lands under tribal and federal jurisdiction it does not restrict commercial gaming on fee lands under state jurisdiction, and indeed the Department has reviewed and approved other compacts in which a state and a tribe essentially have acknowledged that the tribe has a right to conduct commercial gaming under state law without negatively impacting their compact obligations} The Department's Obligation to Publish Returning the Amendments submitted for approval is not one of the options available to the Secretary under IGRA or its implementing regulations in Part 293. Accordingly, because the Acting Assistant Secretary's September 15, 2017 letters neither approved nor disapproved the Amendments, by operation of law the Amendments must now be considered to have been deemed approved pursuant to 25 U.S.C. 2710(d)(8)(C) and 25 C.F.R. 293.12. We urge the Secretary to perform his ministerial statutory and regulatory duty to publish notice of approval in the Federal Register. 2 We understand that the Secretary expressed the concern that through his approval of the Amendments, he is indirectly facilitating the operation of a commercial casino gaming facility. That may be true, but it is not a concern that is relevant to the Secretary's obligation to approve (or deny approval of) the Amendments under IGRA. As long as the Amendments are directly related to the operation of gaming activities, the Secretary does have jurisdiction to approve the amendments and can only disapprove the Amendments for three statutory reasons. As explained in this letter, the Amendments af?rm the understanding of the parties regarding existing obligations relating to the operation of video facsimile games and revenue-sharing provisions, and thus are directly related to the operation of the Tribes' gaming activities under IGRA. 3 The respective tribal gaming compacts between the State of Oklahoma and the Chickasaw and Cherokee Nations each contain exclusivity agreements whereby nontribal operation of gaming devices is limited to those authorized by Oklahoma?s State?Tribal Gaming Act, the state law which also approved the model compact signed by both Nations and submitted to the Department for approval. The State-Tribal Gaming Act authorized three commercial racetracks in the state to operate gaming devices. Two of these commercial racetrack casinos are operated by the tribes under Oklahoma state law. These tribes? compacts were approved by the Department in 2004 and 2005, respectively. Associate Deputy Secretary James Cason October 31, 2017 Page 6 Respectfully, The Mohegan Tribe of Indians of Connecticut The Mashantucket Pequot Tribe (?3:71 V. Heather Sibbison Rob Gips, Kaigi? Smith, JV Dento LLP Drummond Woodsum cc: The Hon. Richard Blumenthal, United States Senate The Hon. Chris Murphy, United States Senate The Hon. joe Courtney, United States House of Representatives The Hon. Dannel Malloy, Governor of the State of Connecticut The Hon. Georgejepsen, Attorney General of the State of Connecticut John Tahsuda, Principal Deputy Assistant Secretary, Indian Affairs Eric Shephard, Assistant Deputy Solicitor, Division of Indian Affairs