How Federal Recognition Secures North Carolina Tribal Futures

This is part two in a two-part series on the complicated process of federal recognition that American Indian tribes must undertake to receive numerous resources and benefits, including the opportunity to conduct tribal gaming.

Read part one here: Why Federal Recognition Is Critical For NC Tribes But Deeply Flawed

Federal recognition is a crucial designation for North Carolina Native American tribes. It gives them access to state and federal aid, and gives tribes the right to offer gambling on their land. When gaining federal recognition through the regular administrative process, tribes can offer gambling on their terms as long as the form of gambling is legal in the state where their land is located.

However, there is one exception. When Congress grants federal recognition, legislation can revoke that right. For example, in 2017, six tribes in Virginia had to forfeit their right to conduct gambling on their lands. This was a condition to achieve federal recognition through House Resolution 984. Virginia debated whether or not to allow casino gambling for over a decade. The gambling prohibition satisfied concerns some legislators had about gambling expansion.

The obstacles to achieving federal recognition through the administrative process can be insurmountable. This situation makes congressional action tempting and in some cases, prudent.

Why gambling rights are so important

Until the 1980s, tribal governments did not have a consistent way to generate large amounts of revenue. That changed when the Seminole tribe in Florida offered high-stakes bingo on their reservation. Tribal gambling began to expand after that. Tribal gambling generated revenue that other sectors couldn’t and other tribes replicated the gaming model.

The development of tribal gambling industries has been uneven. However, the quality of life improvements across tribal reservations speak for themselves. From the 1990s to the 2010s:

– Real per capita income grew 48.6%.

– Labor force participation increased 1.5%.

Child poverty fell 11.8%.

Unemployment fell 6.9%.

– The percentage of homes without complete plumbing fell by 12.4%.

For tribes that launch thriving gambling industries, economic self-sufficiency is transformative.

“The Valley View Casino has provided an economic lifeline while also creating jobs and opportunity for our tribal members,” said Michael Contreras, President of the San Pasqual Economic Development Corporation in Southern California. “The casino created both entry-level jobs and managerial positions so every tribal member could find their place in the industry. After more than two decades in gaming, many tribal members have moved into economic diversification and entrepreneurship as well. Gaming is the engine that has powered our economy and empowered many of our tribal members.”

How commercial gambling endangers tribal revenue

There’s a common myth that Native American tribes only want tribal recognition to open casinos. However, gambling isn’t feasible for every reservation. Federal recognition has other benefits, particularly state and federal aid.

Historically, tribal casinos held a monopoly on casino gambling. Commercial pressure didn’t occur until the 2010s. States legalizing gambling provided new revenue streams to bounce back from the Great Recession. The legalization of sports betting began in 2018. This introduced new commercial gambling competitors. These competitors have drawn revenue away from tribal gambling operations.

In February 2023, the New York Times reported on the impact that commercial competition has had on tribal gambling industries. Due to a lost sportsbook partnership and a land dispute that prevented new revenue streams, the San Juan Southern Paiutes in Arizona had to consider food and water rations.

The picture for unrecognized tribes is even more bleak.

Unrecognized tribes and earmarked aid packages

Tribes with gambling face challenges from online casino options. Unrecognized tribes haven’t been able to develop gambling industries at all.

This is a particularly thorny issue on the East Coast.

Andrew Jackson’s Indian removal policy forced most Indian tribes east of the Mississippi River. There were only a few Native American individuals and communities who were able to escape that policy. That’s why the Eastern Band of Cherokee Indians is in North Carolina and the rest of the Cherokee Nation is in Oklahoma. It’s also why The Lumbee Tribe in North Carolina has not received federal recognition after nearly 70 years of trying.

The tribal recognition process requires, among other things, proof of:

– Continuous residence in an area.

– Ancestry to previous tribal members.

– Governance and political influence over a group of Indians.

If tribes don’t meet the criteria, unrecognized tribal members are not eligible for state and federal aid. They’re also ineligible for Native American scholarships and can’t claim artifacts in museums around the United States.

State and federal aid is crucial for tribal groups without federal recognition. It is particularly important when tribes need help with economic self-sufficiency. North Carolina Tribal Gambling has played an essential role in supplementing that aid for the EBCI.

Gambling’s role in filling budget shortfalls

Federal aid can be earmarked for certain things. So, a federal package can be earmarked for food or water but cannot be used for plumbing or infrastructure. Gambling revenue has been able to supplement budget shortfalls to make up for these earmarks.

If a tribe gains federal recognition and signs away its gambling rights, it makes a trade. That tribe receives aid that the United States government has promised tribes in exchange for tribal land. Even if that funding is imperfect, receiving it is a vast improvement over its absence.

Giving tribes more control over how they use the funds they receive can help solve this problem. Tribes no longer monopolize popular forms of gambling, but it’s still a crucial revenue stream for many tribes.

When crafting gambling regulations, states must consider the impact on tribal communities. In the 2023 legislative session, North Carolina considered building four new casinos in rural areas of the state. This is an attempt to generate new economic activity in those regions. The state would spread the four casinos across the central and southeastern areas.

Encouraging competitive gambling without harming tribal communities is a foundational challenge for states. North Carolina is considering adding new commercial casinos. Commercial casinos would chip away at tribal casino revenue earmarked for social spending. North Carolina must consider the impact new gambling will have on its Native American tribes and adjust aid packages accordingly.


Image credit: Alex Sanz / AP Images

About the Author

Chris Gerlacher

Christopher Gerlacher is a contributor for NC Sharp. He is a versatile and experienced writer with an impressive portfolio who has range from political and legislative pieces to sports and sports betting. He's a devout Broncos fan, for better or for worse, living in the foothills of Arvada, Colorado.