Judge orders mediation in compact dispute between Gov. Stitt and Oklahoma's gaming tribes
An Oklahoma City federal judge has ordered mediation in a compact dispute between Gov. Kevin Stitt and Oklahoma's gaming tribes.
Stitt and the state's gaming tribes have been battling for months over whether the tribes' gaming compacts with the state expired on Jan. 1 or whether they automatically renewed for another 15-year term.
The tribes contend the compacts automatically renewed on that date. Three of them filed a lawsuit in Oklahoma City federal court on New Year's Eve asking Chief District Judge Timothy D. DeGiusti to issue a declaratory judgment in their favor. Stitt contends the compacts expired on that date and that tribes have been illegally operating Las Vegas-style Class III games since then.
“The mediation order entered by Judge DeGiusti is welcomed by the governor and the state," the governor's office said in a prepared statement. "The state’s legal team is committed to engaging in good-faith negotiations that will achieve a productive solution for the state’s future, for its 4 million residents, and for all of Oklahoma’s sovereign tribes.”
Sara Hill, attorney general for the Cherokee Nation, issued a statement saying she was glad to see the case was moving forward.“We appreciate the opportunity to get these proceedings underway and look forward to working with the court to resolve the renewal dispute,” Hill said.
The dispute is part of the governor's efforts to get the tribes to pay the state higher exclusivity rates than the 4% to 6% rate they have been paying on Class III gaming machines and the 10% rate they have been paying on table games. The state has received about $1.5 billion in exclusivity fees from tribes since 2006, including about $148 million in fiscal year 2019, alone.
The federal lawsuit was filed by the Cherokee, Chickasaw and Choctaw nations and has since been joined by the Citizen Potawatomi and Muscogee (Creek) nations.
DeGiusti gave that group of tribes and Stitt each until Friday to submit their lists of three proposed mediators. The judge stated that any other tribes or parties that desire to participate in the court-ordered mediation should file required legal papers by that date.
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The judge promised to act quickly to appoint a mediator from the lists of names they submit or to request new lists if he were to find none of them acceptable.
DeGiusti set up a series of tight deadlines, saying he wanted to receive a joint report on the status of mediation proceedings within 21 days of the mediator's appointment and wants the mediation to be "completed or substantially completed not later than March 31, 2020."
"The Court intends for this date to be a firm deadline," the judge wrote.
Matthew Morgan, chairman of the Oklahoma Indian Gaming Association, said he appreciates the judge's decision to set tight deadlines.
"OIGA is pleased to see that the Judge has moved quickly to set a timeline for the first steps in resolving our dispute with Gov. Stitt, and we look forward to a timely decision on the case," Morgan said. "As always, tribal governments are bound by the compact, and will continue to abide by it. The tribes are making exclusivity fee payments for January 2020, and we are upholding our responsibilities."
While the tribes have continued to make exclusivity payments, Gov. Stitt has advocated holding those payments in a trust until the compact dispute is resolved. In his State of the State speech, the governor called for the Legislature to approve possibly using some state reserves to replace funds that would otherwise be lost to education while the state awaits a decision on whether the gaming compacts expired or automatically renewed.Roughly $130 million annually in gaming revenue goes to fund education.
Mediation discussions between the governor's office and participating tribes are to be confidential, the judge said.
All participants in the mediation will be prohibited from making any public statement or media release about progress of negotiations unless they have specific approval from the judge, the order states.
"This provision shall apply only to the mediation and the mediation process and does not prohibit any party or their counsel from making any public statement, media release, or other comment for public broadcast relating to that party's factual or legal position or any other party's public statement," DeGiusti wrote.
There are 38 federally recognized Indian tribes in Oklahoma, 31 of which have signed gaming compacts, according to the Oklahoma Indian Gaming Association. Gambling is offered at 130 locations that "range from an annex to a gas stop to full-scale resort casinos," the OIGA says on its website.