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Gaming goldmines grow green: limited gaming, good faith negotiations, and the economic impact of the Indian Gaming Regulatory Act in South Dakota.

I. INTRODUCTION

"This is high-stakes litigation...."

--Judge Edith H. Jones (1)

In 1876, Deadwood became legendary for its wild and lawless ways. (2) The history of gaming in Deadwood, South Dakota, is a true Wild West tale. (3) Gamin thrived in Deadwood with the Black Hills' Gold Rush in the late 1800s. (4) Gaming, although unconstitutional, flourished illegally until South Dakota officially ended gaming in Deadwood in 1947 by raiding gaming parlors and burning seized slot machines. (5) The discontinuation of gaming did not last long, however, and gamblers were once again placing bets in Deadwood. (6) During the 1960s, illegal gambling in private clubs was again targeted by the sheriff of Deadwood. (7) In the 1980s, an organized effort took place to legalize gaming; the proponents argued that legalized gaming would revitalize the Deadwood community. (8)

In 1986, South Dakota became the first state in the nation to organize a state-sanctioned lottery. (9) Two years later, South Dakota residents passed the "Deadwood Amendment." (10) This constitutional amendment permitted "limited gaming" within the city limits of Deadwood. (11)

At approximately the same time that Deadwood began redeveloping its gaming industry, Congress passed the Indian Gaming Regulatory Act (IGRA). (12) The IGRA provides that if a type of gaming is permitted by state law, a federally-recognized Indian tribe can conduct the same type of gaming on tribal land. (13) As a result of the "Deadwood Amendment" and the IGRA, all of South Dakota's Indian tribes have engaged in some type of gaming since the early 1990s. (14)

This comment first reviews the IGRA's legislative history and complex substantive and procedural framework. (15) Next, this comment provides a brief historical analysis of gaming in South Dakota, (16) reviews gaming's economic impact on the state, (17) and examines whether the Governor has the authority to unilaterally execute gaming compacts. (18) This comment then reviews the interpretation of the IGRA's good faith requirement by the most recent federal court in South Dakota to review the issue. (19)

Ultimately, this comment reaches three conclusions. First, the Governor's unilateral role in executing gaming compacts likely violates the South Dakota Constitution. (20) Second, South Dakota has consistently adhered to its public policy of limited gaming. (21) Third, by remaining a state of limited gaming, South Dakota has satisfied the IGRA's requirement of good faith in its recent gaming compact negotiations with the Flandreau Santee Sioux Tribe (FSST). (22)

II. BACKGROUND

A. THE INDIAN GAMING REGULATORY ACT

1. The Legislative History of the IGRA

Indian gaming dates back to the 1970s and early 1980s when a few Indian tribes in California and Florida opened high-stakes bingo halls to generate revenue. (23) Kathryn R.L. Rand and Steven Andrew Light, co-directors of the Institute for the Study of Tribal Gaming Law and Policy, (24) explained: "As one of the few viable strategies for reservation economic development, bingo presented an attractive option to tribal governments: start-up costs were relatively low, the facilities had a minimal impact on the environment, and the game had potential for high returns on the tribes' investment." (25)

As Indian gaming began to flourish around the country, the United States Supreme Court delivered a pivotal decision in 1987 in California v. Cabazon Band of Mission Indians. (26) The Cabazon Band of Mission Indians (Cabazon Band) conducted bingo games and opened a card club in which draw poker and other card games were played. (27) The State of California sought to enforce a state statute which only permitted the game of bingo if operated for charitable purposes and if the maximum prize did not exceed $250. (28) The State maintained that the Tribe must comply with state law and that the Tribe's current operation was in violation of the state statute. (29)

The United States Supreme Court concluded that state laws may be applicable to Indian reservations if Congress expressly granted that authority to the state. (30) "The shorthand test is whether the conduct at issue violates the state's public policy." (31) When California law was examined, the United States Supreme Court found that California did not prohibit all forms of gambling because the state operates and encourages citizens to participate in a state Iottery. (32) Because California allows gaming, including bingo, and promotes gambling through the state lottery, the Court concluded that California could not regulate bingo on Indian reservations. (33) "The Court's decision in Cabazon opened the door for the expansion of gaming in Indian country free from state regulatory control." (34)

In response to the United States Supreme Court's decision in Cabazon, Congress enacted the IGRA in 1988. (35) The IGRA is intended to balance the state's, tribe's, and federal government's interests regarding gaming. (36) One of the IGRA's primary purposes is "to provide a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments." (37) Additionally, the IGRA is intended to shield Indian gaming from organized crime, ensure tribes are the beneficiaries of the gaming, and guarantee gaming is conducted fairly. (38) As one federal court opined in 2002:
   [The] IGRA was Congress' [s] compromise solution to the difficult
   questions involving Indian gaming. The Act was passed in order to
   provide "a statutory basis for the operation of gaming by Indian
   tribes as a means of promoting tribal economic development,
   self-sufficiency, and strong tribal governments" and "to shield
   [tribal gaming] from organized crime and other corrupting
   influences to ensure that the Indian tribe is the primary
   beneficiary of the gaming operation." 25 U.S.C. [section] 2702(1),
   (2). The IGRA is an example of "cooperative federalism" in that it
   seeks to balance the competing sovereign interests of the federal
   government, state governments, and Indian tribes, by giving each a
   role in the regulatory scheme. (39)


The IGRA applies to gamin activities conducted by federally-recognized Indian tribes (40) on Indian lands. (41) To meet congressional concerns regarding gaming and to ensure gaming revenues actually benefit the tribes, the IGRA declares independent federal regulatory authority for gaming on Indian lands, creates federal standards for gaming, and establishes a National Indian Gaming Commission. (42) In other words, the IGRA "provides a comprehensive scheme for regulating gaming activities on Indian land." (43)

2. The IGRA's Three Classes of Gaming

The IGRA divides gaming into three classes, each subject to differing levels of regulation. (44) According to Rand and Light, "[o]ne of [the] IGRA's key innovations was its categorization of tribal gaming for regulatory purposes." (45)

Class I gaming includes "social games solely for prizes of minimal value or traditional forms of Indian gaming engaged in by individuals as part of, or in connection with, tribal ceremonies or celebrations." (46) Regulation of class I gaming is within the exclusive jurisdiction of the Indian tribes and is not subject to the provisions of the IGRA. (47)

Class II gaming includes bingo, pull-tabs, lotto, punch cards, tip jars, and card games as well as banking card games operated on or before May 1, 1988, if played in conformity with state law regarding wagers, pot sizes, and hours of operation. (48) Class II gaming does not include banking card games such as baccarat, chemin de fer, blackjack, or electronic games of chance or slot machines. (49) Regulation of class II gaming is within the jurisdiction of the Indian tribes but is subject to the provisions set forth in the IGRA. (50) In addition, the National Indian Gaming Commission is authorized to approve any ordinance or resolution pertaining to the conduct or regulation of class II gaming. (51)

Class III gaming includes casino-type games, pari-mutuel horse and dog racing, slot machines, lotteries, and all other forms of gaming that are not class I or class II gaming. (52) Three conditions must be met before a tribe may conduct class III gaming on Indian land. (53) First, all gaming activities must be authorized by an ordinance or resolution adopted by the governing body of the tribe and approved by the National Indian Gaming Commission chairman. (54) Second, the state must permit the type of gaming requested for any purpose, by any person, organization, or entity. (55) And third, all gaming must be conducted in conformance with a tribal-state gaming compact (gaming compact). (56)

3. The IGRA's Unique Procedural Framework and the Requirement of Good Faith Negotiation

The IGRA is based on the legislative conclusion that class III gaming should only be conducted under a valid tribal-state gaming compact. The IGRA provides a precise and systematic framework for negotiating a gaming compact. (58) Under the IGRA, an Indian tribe must first request a state to enter into gaming compact negotiations. (59) After a state receives a tribe's request, "the State shall negotiate with the Indian tribe in good faith to enter into such a compact." (60) If a tribe and a state reach an agreement, the compact takes effect upon the approval of the Secretary of the Interior. (61)

Although the IGRA mandates a gaming compact, it does not require any specific gaming compact provisions. (62) However, the IGRA provides guidance on provisions that may be included. (63) These may include provisions relating to criminal laws and regulations, the licensing and regulation of gaming activities, the state's assessment of the cost of regulating gaming, and other subjects that are directly related to gaming activities. (64)

If a tribe and a state cannot reach an agreement within 180 days after a tribe's initial request for negotiations, the tribe may file suit in federal court. (65) The burden of proof is then placed on the state to prove that it negotiated with the tribe in good faith. (66) Unfortunately, the IGRA does not provide a definition of good faith. (67)

However, the IGRA provides various public policy and economic and social factors for the court to consider in making its good faith determination. (68) A court may take into account "the public interest, public safety, criminality, financial integrity, and adverse economic impacts on existing gaming activities" to determine if a state has negotiated in good faith. (69) Additional guidance for analyzing the IGRA's good faith standard is provided in the Act's legislative history. (70) The Senate Committee Report stated:
      In the Committee's view, both [s]tate and tribal governments have
   significant governmental interests in the conduct of class III
   gaming. States and tribes are encouraged to conduct negotiations
   within the context of the mutual benefits that can flow to and from
   the tribe and [s]tates. This is a strong and serious presumption
   that must provide the framework for negotiations. A tribe's
   governmental interests include raising revenues to provide
   governmental services for the benefit of the tribal community and
   reservation residents, promoting public safety as well as law and
   order on tribal lands, realizing the objectives of economic
   self-sufficiency and Indian self-determination, and regulating
   activities of persons within its jurisdictional borders. A
   [s]tate's governmental interests with respect to class III gaming
   on Indian lands include the interplay of such gaming with the
   [s]tate's public policy, safety, law and other interests, as well
   as impacts on the [s]tate's regulatory system, including its
   economic interest in raising revenue for its citizens. It is the
   Committee's intent that the compact requirement for class III not
   be used as a justification by a [s]tate for excluding Indian tribes
   from such gaming or for the protection of other [s]tate-licensed
   gaming enterprises from free market competition with Indian tribes.

   Finally, the bill allows [s]tates to consider negative impacts on
   existing gaming activities. That is not to say that the bill would
   allow [s]tates to reject Indian gaming on the mere showing that
   Indian gaming will compete with non-Indian games. Rather, [s]fates
   must show that economic consequences will be severe and that they
   will clearly outweigh positive economic consequences. (71)


If the district court concludes that a state failed to negotiate with a tribe in good faith, the court orders the state and the tribe to conclude a gaming compact within sixty days. (72)

If the state and tribe cannot agree on a gaming compact within these sixty days, the parties submit their "best offers" to a court-appointed mediator. (73) The mediator then selects the gaming compact which best com forts with federal law, the provisions of the IGRA, and the findings of the court. (74) If the state objects to the mediator's proposed compact within sixty days of its submission, the Secretary of the Interior prescribes the compact's provisions in a manner consistent with the compact proposed by the mediator, the terms of the IGRA, and state law. (75) A notice of the approved gaming compact is then published by the Secretary of the Interior in the Federal Register. (76)

B. THE HISTORY OF GAMING IN SOUTH DAKOTA AND GAMING'S IMPACT ON THE SOUTH DAKOTA ECONOMY

The South Dakota Constitution was adopted in 1889. (77) At that time, Article III, section 25, provided "[t]he legislature shall not authorize any game of chance, lottery or gift enterprises, under any pretense, or for any purpose." (78) However, beginning in the 1980s, this prohibition against gaming has slowly given way to South Dakota's current public policy of limited gaming. (79)

1. State-Sanctioned Gaming

In the 1980s, South Dakota began to incrementally authorize various forms of gaming. (80) Modern gaming in South Dakota began in November 1986 when a statewide referendum was passed authorizing a state lottery. (81) The next year, South Dakota created the South Dakota Lottery, which allowed sales of instant tickets. (82) The South Dakota Legislature studied the issue of video lottery, (83) and legislation was introduced in 1988 to authorize video lottery. (84) The 1988 video lottery legislation failed by one vote in the South Dakota Senate. (85) However, the next year, the Legislature approved similar legislation and South Dakota sanctioned the first video lottery system in the nation; video lottery play commenced on October 15, 1989. (86) In 1992, South Dakota voters overwhelmingly rejected an initiated measure to repeal video lottery. (87)

After this initiative failed, a lawsuit was filed on November 30, 1992, questioning the constitutionality of the video lottery. (88) In Poppen v. Walker, (89) the South Dakota Supreme Court held that video lottery was unconstitutional because it was not a "lottery" but rather a "game of chance" prohibited by the South Dakota Constitution. (90) In striking down video lottery, the court stated:
   The 1986 [video lottery] amendment was an exception to the general
   prohibition against gambling. The intent of the people in adopting
   that amendment was not to give the legislature carte blanche power
   to authorize any form of gaming which contains the elements of
   prize, chance, and consideration. [Rather] [t]he sole power granted
   was to authorize "a state lottery," not state "games of chance."
   (91)


As a result of the Poppen decision, video lottery terminals in South Dakota were shut down. (92) However, in July 1994, the South Dakota Legislature immediately responded to the Poppen decision by holding a special session and passing a resolution that placed a constitutional amendment authorizing video lottery on the November ballot. (93) Later that year, the proposed amendment was adopted, and South Dakota once again had video lottery. (94) In 2000 and 2006, voters again rejected two well-organized attempts to repeal video lottery, further cementing South Dakota's support of state-sanctioned gaming. (95)

Although legalized gaming has prospered only since the mid-1980s, gaming initially thrived in Deadwood with the emergence of the Black Hills' Gold Rush in the late 1800s. (96) During the 1920s, gaming was illegal in Deadwood but "continued to operate behind closed doors." (97) Once the Prohibition Act was repealed in 1933, illegal gaming once again flourished in Deadwood. (98)

During the early 1940s, with illegal gambling thriving, owners of gambling parlors wanted to expand operations. (99) Although South Dakota sought to stop the expansion, parlor owners continued with their plan. (100) The State seized gambling equipment during a raid on five nightclubs in Deadwood on June 28, 1947, which was ordered by Attorney General Sigurd Anderson. (101) Following the raid, County Judge Matthew Furze ordered the gambling equipment be destroyed. (102) In 1947, gaming in Deadwood officially ended. (103) However, the closure did not last long, and illegal gambling soon began again. (104)

In the late 1960s, illegal gambling in private clubs in Deadwood was again shut down. (105) The clubs were operating manual slot machines, and the owners and operators had been asked to shut the machines down. (106) Finally, the sheriff entered one club and seized all of the machines, and a court order permitted the sheriff to destroy each of the machines. (107) After the seizure of the machines, all other clubs within Deadwood shut down their machines. (108)

By the mid-1980s, many of Deadwood's historical buildings were in disrepair. (109) With the intention of preserving Deadwood's storied history, the "Deadwood You Bet" Committee was formed in 1986. (110) This Committee advocated the legalization of limited gaming in Deadwood. (111) In 1987, Deadwood You Bet presented the notion of legalized gambling in Deadwood to the South Dakota Legislature, but the Committee was unsuccessful. (112) However, the Committee persisted in their endeavors to legalize gambling for Deadwood. (113)

In 1988, Deadwood You Bet successfully spearheaded the effort to place a constitutional amendment on the ballot that permitted limited casino-style gaming within Deadwood's city limits. (114) The amendment proposed to allow the "Legislature to authorize 'limited card games and slot machines' within the City of Deadwood" with the approval of "sixty percent of the Deadwood voters" and with "the 'entire net proceeds' of the games" dedicated "to the historical restoration and preservation of Deadwood." (115)

The amendment was overwhelmingly approved, and shortly thereafter the South Dakota Legislature enacted a statute that allowed "limited card games and slot machines" in Deadwood. (116) The South Dakota Legislature specified that gaming must be conducted within the city limits of Deadwood, (117) established a five dollar maximum bet limit, (118) and set the maximum number of games and machines to not more than fifteen per retail license. (119) However, before any gaming could actually take place, one final condition had to be met--the voters of Deadwood had to approve gaming within its city limits by a 60% margin. (120) On April 11, 1989, Deadwood's new industry of limited casino-style gaming was approved by a 75% margin. (121)

The constitutional requirement of "limited card games and slot machines" is enforced through a complex array of statutes and administrative rules that restrict the scope of Deadwood's gaming industry. (122) For instance, although maximum bet limits have increased in the past decade from the original five dollar maximum (123) to today's one hundred dollar maximum, (124) the fact remains that bet limits in Deadwood continue to be limited. (125) Also, the number of gaming devices within a single building may not exceed thirty devices. (126) Finally, an individual with a financial interest may be granted no more than three retail licenses for a total of ninety gaming devices. (127)

2. Indian Gaming

South Dakota is home to nine federally-recognized Indian tribes. (128) Once limited gaming was approved in Deadwood, many tribes quickly invoked the IGRA's provisions and requested that the State engage in gaming compact negotiations. (129) In June 1989, the Flandreau Santee Sioux Tribe (FSST) became the first tribe to request negotiations. (130) After five months of unsuccessful negotiations, the FSST sued the State, alleging violations of the IGRA. (131) The case was settled and a gaming compact was finalized in July 1990. (132) This original gaming compact provided the FSST with 180 gaming devices for a three-year term. (133) An acceleration provision within the gaming compact allowed the FSST to increase its gaming devices from 180 to 250 when play on the machine reached a described level for a sustained period of time. (134)

Since 1990, the State has entered into separate, but nearly identical, gamin compacts with each of South Dakota's Indian tribes (Gaming Tribes). (135) Currently, the State of South Dakota has class III gaming compacts with the Crow Creek Sioux Tribe, Lower Brule Sioux Tribe, Oglala Sioux Tribe, Rosebud Sioux Tribe, Sisseton-Wahpeton Sioux Tribe, Standing Rock Sioux Tribe, and Yankton Sioux Tribe. (136) Since June 2006, because of a pending lawsuit with the State, the FSST has conducted its gaming operations under an expired gaming compact. (137)

Each of these gaming compacts establish: (1) the geographic scope of where each Gaming Tribe can conduct gaming; (138) (2) the types of games that can be offered at the Gaming Tribe's casino; (139) (3) the number of slot machines and blackjack tables each Gaming Tribe is allowed; 140 (4) the length of each Gaming Tribe's gaming compact; (141) and (5) the maximum bet limits. (142)

3. Economic Impact of Gaming

Gaming produces millions of dollars of annual revenue for the State of South Dakota. (143) Since its inception in 1989, the South Dakota Lottery has distributed over $1.6 billion in revenue. (144) In fiscal year 2008, instant ticket and lotto ticket sales combined for over $42.4 million. (145) After prize payments were distributed, the State's General Fund and Capital Construction Fund received approximately $11.3 million. (146)

Video lottery in South Dakota also raises substantial amounts of money for programs and projects within the state. (147) The total net machine income generated in 1990, the first year of video lottery gaming, was estimated at over $48.8 million. (148) By 1992, video lottery had become the State General Fund's second largest source of revenue. (149) Almost twenty years later, in 2008, net machine income reached $223 million, providing South Dakota with more than $111 million in total revenue. (150)

Since 1990, Deadwood's gaming action has been over eleven billion dollars, resulting in gross income of over one billion dollars. (151) In 1991, the first full year of Deadwood gaming, 2,085 gaming devices were licensed, and gaming action totaled over $329 million, resulting in gross revenue of over $33 million. (152) In 2008, 3,644 gaming devices were licensed, and Deadwood's gaming action grew to over $1.1 billion generating $101.5 million in gross revenue. (153)

Unlike the significant percentage of net machine income South Dakota receives from video lottery, (154) South Dakota's share of Deadwood's gaming revenue is considerably smaller. (155) South Dakota law imposes "an eight percent tax on the adjusted gross proceeds of [Deadwood] gaming." (156) The proceeds from this eight percent tax are then distributed to the City of Deadwood, Lawrence County, other municipalities in Lawrence County, local school districts, and the State of South Dakota. (157)

Gaming also produces millions of dollars of revenue for South Dakota's Gaming Tribes. (158) While precise tribal revenue figures are often difficult to calculate, published studies and local financial indicators reveal the significant economic effect gaming has on the Gaming Tribes. (159) In Casino City's Indian Gaming Industry Report, an annual report providing economic data concerning Indian gaming, all of South Dakota's Indian gaming facilities generated combined gaming revenue of $97.1 million in 2007. (160) The gaming facilities in South Dakota operated a total 2,206 slot machines and 70 table games in 2007. (161) Tribal income from casino gaming is thus nearly equal to the income from casino gaming in Deadwood. (162)

In an attempt to determine Indian gaming's true impact in South Dakota, the South Dakota Commission on Gaming retained Cummings Associates, a well-respected gaming market analysis firm from Arlington, Massachusetts. (163) According to the Cummings Report, in 2003, the Gaming Tribes' nine casinos operated a combined total of 54 table games and 1,919 slot machines, generating an estimated "total win" of $75.4 million. (164) Since 2003, despite the recent downturn in the national economy, the Gaming Tribes' revenues have reportedly continued to grow exponentially. (165)

However, in South Dakota, there remains a vast disparity among the Gaming Tribes' respective gaming operations. (166) There appear to be two primary reasons for this disparity. (167) First, the economic successes of the Gaming Tribes' respective casinos vary considerably. (168) "The top tier [of the South Dakota Gaming Tribes' casinos is] roughly five times as large in terms of gaming revenues as those of the bottom tier, and employ[s] nearly three times as many people." (169) In 2003, the Gaming Tribes' three largest casinos had combined total gaming revenues of $43.5 million, while the Gaming Tribes' three smallest casinos had combined total gaming revenues of only $8.7 million. (170)

Second, the Gaming Tribes' respective locations impact profitability. (171) A large percentage of South Dakota's population lies along the Interstate 29 corridor. (172) Because consumers are "much more likely to visit the nearest [gaming] facility," (173) the Gaming Tribes which are located near this population corridor have an inherent advantage over the Gaming Tribes located in less populous areas of the state. (174)

C. THE GOVERNOR'S AUTHORITY TO EXECUTE GAMING COMPACTS

The South Dakota Constitution specifies the relative powers of the three branches of government. (175) Article Il states, "[t]he powers of the government of the state are divided into three distinct departments, the legislative, executive[,] and judicial; and the powers and duties of each are prescribed by this Constitution." (176) The constitution's separation of powers provision, however, does not specifically detail each branch's authority. (177)

In 1989, as part of an extensive package of gaming-related legislation, the South Dakota Legislature enacted S.D.C.L. section 1-4-25, which states, "[b]efore entering into a compact with an Indian tribe on any class III gaming under the Federal Indian Gaming Regulatory Act, the Governor or his designee shall hold one or more public hearings in the affected area to allow any interested persons to state their views." (178) After the legislation was approved, Governor George S. Mickelson signed the first gaming compact with the FSST. (179) This statute has presumably provided Governors Walter Dale Miller, William J. Janklow, and M. Michael Rounds with the statutory authority to unilaterally negotiate and execute gaming compacts during their respective administrations. (180)

As a practical matter, the Governor's unilateral role in executing gaming compacts appears secure at this time. (181) During the 2005 and 2006 South Dakota Legislative Sessions, legislation was introduced that would have required legislative approval of future gaming compacts. (182) The primary justification for these bills was based upon the separation of powers doctrine. (183) The South Dakota Senate passed both bills. (184) However, the South Dakota House of Representatives did not pass either bill; thus, the Governor continues to have the authority to execute a gaming compact. (185)

Several state cases have confronted the issue of whether a governor is authorized to unilaterally negotiate and execute gaming compacts without legislative approval. (186) Unfortunately, these cases have reached conflicting results, and the division over a governor's authority in this area will likely continue. (187)

In Dewberry v. Kulongoski, (188) a federal district court in Oregon found that Governor Theodore Kulongoski had the authority to negotiate and execute a class III gaming compact. (189) In Dewberry, the State of Oregon and a group of Oregon Indian tribes signed a class III gaming compact. (190) Soon after the gaming compact was approved, a group of anti-gambling opponents sought a declaration that the gaming compact was "unconstitutional, illegal, null and void." (191) The plaintiffs argued that Oregon law did not delegate the authority to execute gaming compacts to the Governor without express legislative approval. (192) The State maintained that the Governor possessed this authority "because the Oregon Constitution provides that the Governor 'shall transact all necessary business with the officers of government."' (193) The State also argued that negotiating and executing gaming compacts is "necessary business" of the Governor. (194)

In rejecting the plaintiff's arguments, the district court held that "the execution of gaming contracts is 'necessary business' to support the Governor's authority to do so under [the Oregon Constitution]." (195) "In sum, as head of the executive branch, the Governor may negotiate a tribal-state [gaming] compact under the IGRA, or delegate that responsibility to any officer or officers within the executive branch." (196)

The district court concluded its analysis by noting that recent legislative history also favored the Governor's unilateral role in executing gaming compacts. (197) The Oregon Legislature previously rejected attempts that would have "implement[ed] a legislative role in the negotiation and execution of state-tribal [gaming] compacts." (198) Because of the statutory language and legislative history, the district court found that the Governor was authorized to both negotiate and execute gaming compacts. (199)

However, other federal courts have held that although a governor can conduct gaming compact negotiations, a governor is not authorized to actually execute a gaming compact. (200) In State ex rel. Stephan v. Finney, (201) the Attorney General of Kansas challenged the authority of Kansas Governor Joan Finney to negotiate and execute a gaming compact with the Kickapoo Nation (Kickapoo). (202) The Governor asserted that she had the requisite authority because the Kansas Constitution provided her with "supreme executive power of Kansas." (203) Additionally, the Governor contended that the Kansas Legislature was in session only for a short time, and "[e]xpediency requires that the Governor be held to have the authority to act on behalf of the State in [the] IGRA matters." (204)

The Attorney General contended that while the Kansas Constitution makes the Governor the head of the executive branch, the Governor is responsible only for enforcing, not enacting, the laws of the state. (205) Because executing the Kickapoo gaming compact was essentially a legislative function, the State could only be legally bound through legislative action. (206) Thus, according to the Attorney General, the Governor violated the Kansas Constitution's separation of powers requirement. (207)

The district court agreed with the Attorney General that Kansas law did not authorize the Governor to execute the gaming compact, which was "clearly legislative in nature." (208) The district court opined that the power to enact and amend laws is delegated exclusively to the legislature, and that while the Governor could negotiate a gaming compact, "in the absence of an appropriate delegation of power by the Kansas Legislature or legislative approval of the compact, the Governor has no power to bind the State to the terms thereof" (209)

In State ex rel. Clark v. Johnson, (210) a number of petitioners alleged that New Mexico Governor Gary Johnson lacked the authority to execute a gaming compact with the Pojoaque Pueblo Tribe (Pojoaque Pueblo). (211) Specifically, the petitioners contended that by executing the compact, the Governor improperly usurped legislative authority in violation of the New Mexico Constitution's separation of powers doctrine. (212)

The New Mexico Supreme Court concluded that the gaming compact entered into between the Governor and the Pojoaque Pueblo gave the Governor a "virtually irrevocable and seemingly perpetual right to conduct any form of class III gaming permitted in New Mexico[.]" (213) By negotiating a compact, the court concluded the Governor disregarded the New Mexico Legislature's dislike of commercial gambling and exceeded his authority. (214) The court stated:
   Residual governmental authority should rest with the legislative
   branch rather than the executive branch. The state legislature,
   directly representative of the people, has broad plenary powers. If
   a state constitution is silent on a particular issue the
   legislature should be the body of government to address the issue.
   (215)


The court concluded, "[w]hile the legislature might authorize the Governor to enter into a gaming compact or ratify his actions with respect to a compact he has negotiated, the Governor cannot enter into such a compact solely on his own authority." (216)

In Saratoga County Chamber of Commerce, Inc. v. Pataki, (217) legislators, organizations, and individuals opposed to gambling challenged New York Governor George E. Pataki's authority to execute gaming compacts without legislative approval. (218) The Governor and the St. Regis Mohawk Tribe (St. Regis) signed an amended gaming compact which allowed St. Regis to operate electronic gaming, including keno. (219) Shortly after the amended gaming compact took effect, the plaintiffs brought suit alleging that both the original compact and the amendment "violated the separation of powers and the constitutional gambling prohibition." (220)

The Supreme Court of New York declared the amendment void and unenforceable and enjoined the Governor from taking any further action without legislative approval. (221) The appellate division affirmed and held "the Governor's unilateral action deprived the Legislature of its policymaking authority[.]" (222)

The court held that separation of powers "requires that the [New York] Legislature make the critical policy decisions, while the executive branch's responsibility is to implement those policies." (223) The court also opined that the Governor's actions constituted "policymaking" and were legislative in nature. 224 The court concluded that the approved gaming compact encompassed fundamental policy choices that "epitomize[d] 'legislative power.'" (225) As such, the Governor "lack[ed] the power unilaterally to negotiate and execute tribal gaming compacts under [the] IGRA." (226)

In Florida House of Representatives v. Crist, (227) Governor Charles Crist and the Seminole Indian Tribe executed a gaming compact. (228) However, the Florida Legislature had not authorized the Governor to execute the compact. (229) The Florida House of Representatives and Speaker Marco Rubio alleged that the Governor did not have the authority to execute the gaming compact. (230) The House of Representatives alleged that only the Legislature has the authority to execute gaming compacts because the Florida Constitution does not expressly grant that authority to the Governor. (231)

The Florida Supreme Court found that "the Governor's execution of a [gaming] compact authorizing types of gaming that are prohibited under Florida law violates the separation of powers. The Governor has no authority to change or amend state law. Such power falls exclusively to the Legislature." (232)

Several states have dealt with the issue of a governor's unilateral authority to negotiate and execute gaming compacts with no legislative approval. (233) Although these cases have not reached a consensus, four out of five courts have declared that a governor may negotiate a gaming compact but may not unilaterally execute a gaming compact. (234)

D. THE FEDERAL COURT'S INTERPRETATION OF "GOOD FAITH" IN SOUTH DAKOTA

Under the IGRA, once a tribe requests negotiations with a state to create a gaming com]act, the state is required to "negotiate with the Indian tribe in good faith...." (23) In recent years, several federal courts have addressed the issue of whether a state has negotiated with a tribe in good faith. (236) Unfortunately, the IGRA does not provide a definition of good faith. (237) However, in determining if a state has negotiated in good faith, a court:
   may take into account the public interest, public safety,
   criminality, financial integrity, and adverse economic impacts on
   existing gaming activities and shall consider any demand by the
   State for direct taxation of the Indian tribe or of any Indian
   lands as evidence that the State has not negotiated in good faith.
   (238)


In Cheyenne River Sioux Tribe v. South Dakota, (239) the Cheyenne River Sioux Tribe requested gaming compact negotiations with the State in January 1991. (240) Eight negotiating sessions were conducted, and when no gaming compact was completed, the Cheyenne River Sioux Tribe (CRST) brought suit alleging the State violated the IGRA by failing to negotiate in good faith. (241)

The CRST alleged that its circumstances were unique, and the State improperly refused to deviate from a "model" gaming compact that had earlier been executed between the State and the FSST. (242) The CRST also submitted that the State failed to negotiate in good faith by rejecting increased bet limits and the inclusion of "traditional keno" and other games not permitted by state law. (243) In rejecting the CRST's allegations, the federal district court found that it was "unable to say that the State has not negotiated in good faith[.]" (244) The district court specifically found that the State negotiated in good faith concerning bet limits, and because the State only allowed video keno, the State did not have to negotiate for other types of keno. (245)

In affirming the district court's decision, the Eighth Circuit Court of Appeals held that the State did negotiate in good faith because only video keno, not traditional keno, was permitted under South Dakota law. (246) According to the Eighth Circuit, "[t]he 'such gaming' language of 25 U.S.C. [section] 2710(d)(1)(B) does not require the State to negotiate with respect to forms of gaming it does not presently perm it." (247) The Eighth Circuit also concluded that bet limits were set by state statute, and the CRST's demand for increased limits was not a proper subject for negotiation. (248)

Today, the issue of good faith is once again being litigated in South Dakota. (249) In Flandreau Santee Sioux Tribe v. South Dakota, 250 the FSST commenced a suit alleging that the State has refused to negotiate an amended gaming compact in good faith. (251)

In September 2005, the State and the FSST began formal negotiations for an amended gaming compact. (252) During these negotiating sessions, the FSST informed the State of its desire to dramatically expand its gaming facility at Royal River Casino by building a "hotel resort/water park/family recreation center and event center for top-quality performers to serve the needs of the local communities." (253) To support this project, the FSST requested an increase in the number of slot machines from its current 250 machine limit to an "unlimited" number of machines. (254) The FSST also sought to extend its gaming compact from a three-year term to a twenty-year term. (255) The State countered that the FSST's demand for an "unlimited" number of slot machines would be inconsistent with South Dakota's public policy of limited gaming. (256) After multiple negotiating sessions, the parties were unable to agree on an amended gaming compact, and in March 2007, the FSST sued the State for failing to negotiate in good faith. (257)

III. ANALYSIS

A. THE GOVERNOR'S UNILATERAL ROLE IN COMPACT NEGOTIATIONS LIKELY VIOLATES THE SOUTH DAKOTA CONSTITUTION

Neither South Dakota's federal nor state courts have considered whether the Governor of South Dakota is authorized to negotiate and execute gaming compacts with the Gaming Tribes. However, a close analysis of South Dakota law and recent out-of-state court decisions leads to the conclusion that since the early 1990s, Governors Mickelson, Miller, Janklow, and Rounds have likely violated the South Dakota Constitution by unilaterally executing gaming compacts with the Gaming Tribes. (258)

Article 11 of the South Dakota Constitution provides, "[t]he powers of the government of the state are divided into three distinct departments, the legislative, executive[,] and judicial; and the powers and duties of each are prescribed by this constitution." (259) In other words, the constitution's separation of powers doctrine prohibits one branch of government from usurping the powers of another branch. (260)

There are two basic, yet fundamental, methods of analyzing the complex area in which the IGRA's mandates intersect with the South Dakota Constitution's doctrine of separation of powers: by those who favor the Governor's unilateral role in executing gaming compacts and by those who favor legislative approval. (261)

The Governor's ability to unilaterally execute gaming compacts can be supported in three ways. (262) First, as a practical matter, time constraints preclude the South Dakota Legislature from taking an active role in the gaming compact process by only having a legislative session with a maximum of forty days. (263) Because of the IGRA's complex procedural framework, a governor is the only person or governmental entity that can actually meet the IGRA's restrictive time requirements. (264) Therefore, expediency requires that a governor have the authority to negotiate and execute gaming compacts. (265) However, while this expediency argument appears plausible, expediency alone cannot grant power to the executive branch which the South Dakota Constitution does not specifically delegate. (266) In sum, the constitutional mandate of separation of powers cannot simply be superseded by the convenience of expediency. (267)

Second, the South Dakota Legislature has already granted the Governor this unilateral authority. (268) S.D.C.L. section 1-7-1(4) provides that the Governor, "is the sole official organ of communication between the government of this state and the government of any other state of the United States[.]" (269) Because the Gaming Tribes are quasi-sovereign entities, the Governor is endowed with the authority to execute gaming compacts. (270) Also, S.D.C.L. section 1-7-1(8) states that the Governor "shall have such other powers and must perform such other duties as are or may be devolved upon him by law." (271) The IGRA is binding federal law. (272) Therefore, executing gaming compacts clearly falls within the Governor's role of performing "other duties ... developed upon him by law." (273)

While these statutory authority arguments are novel, the IGRA's plain language casts doubt on their validity. (274) The IGRA requires the Gaming Tribes to request gaming compact negotiations with the state. (275) The IGRA also requires the state to negotiate in good faith. (276) While the IGRA does not identify whether the executive or legislative branch may execute gaming compacts, nowhere does the IGRA equate the state with the governor. (277)

Third, the South Dakota Legislature has already rejected legislation that would have limited the Governor's gaming compact authority. (278) In recent years, the South Dakota Legislature considered two proposals that would have provided that body with the authority to review and execute gaming compacts. 279 Both of these bills were defeated, providing further evidence that the legislature desires to endow the Governor with the unilateral authority to execute gaming compacts. (280)

The demise of these legislative proposals, however, occurred due to a multitude of economic, social, and political reasons. (281) Surely, the rejection of these bills does not indicate that the South Dakota Legislature intends to simply defer all gaming compact authority to the Governor. (282)

Conversely, the South Dakota Legislature's authority as the final arbiter of gaming compacts can be based on a single justification--the Governor's current unilateral role in executing gaming compacts violates the South Dakota Constitution's separation of powers doctrine by encroaching upon the Legislature's law-making powers. (283) The South Dakota Constitution provides "the legislative power of the state shall be vested in the Legislature which shall consist of a senate and house of representatives" and it is those bodies which are responsible for making laws. (284) Meanwhile, "the Governor shall be responsible for the faithful execution of the law." (285) Several states have litigated over the issue of whether a governor has the unilateral authority to negotiate and execute a gaming compact with no legislative approval (286) and the majority of the states have declared that a governor may negotiate a gaming compact but may not unilaterally execute a gaming compact. (287)

South Dakota law simply does not delegate the authority to execute gaming compacts to the Governor. (288) The South Dakota Legislature is solely responsible for creating law. (289) In addition, since the execution of a gaming compact is essentially a law-making function, the State can only be bound through appropriate legislative action. (290) In fact, the only statute which expressly provides the Governor with any gaming compact authority is S.D.C.L. section 1-4-25 which requires the Governor to "hold one or more public hearings" to allow "interested persons to state their views." (291) It appears somewhat questionable that this statute can be extended to encompass the Governor's unilateral authority in executing gaming compacts. (292)

The question of a governor's authority to bind a state to a gaming compact is a matter of state law. (293) "[The] IGRA does not and cannot confer legislative power on the governor in violation of the separation of powers clearly set forth in the Kansas [C]onstitution." (294) The South Dakota Legislature has not enacted specific legislation authorizing the Governor to execute gaming compacts. (295) Therefore, based on the fundamental constitutional principle of separation of powers, the Governor of South Dakota is without the authority to execute a gaming compact without legislative approval. (296)

B. BY ADHERING TO ITS PUBLIC POLICY OF "LIMITED GAMING," THE STATE OF SOUTH DAKOTA HAS ACTED IN "GOOD FAITH" IN COMPACT NEGOTIATIONS WITH THE FLANDREAU SANTEE SIOUX TRIBE

1. South Dakota Continues to Be a State of Limited Gaming

South Dakota law provides for "limited card games and slot machines within the city limits of Deadwood[.]" (297) Since the early 1990s, South Dakota has strived to adhere to this public policy of limited gaming. (298) Despite these efforts, the FSST filed a lawsuit alleging that South Dakota's public policy is no longer one of limited gaming and thus, the State has not acted in good faith in negotiating an amended gaming compact. (299)

However, a thorough analysis reveals that South Dakota has succeeded on both fronts. (300) The State has maintained its public policy of limited gaming by delicately balancing the interests of Deadwood and the Gaming Tribes. (301) Furthermore, by maintaining its public policy of limited gaming, the State's decision to decline the FSST's demand for an "unlimited" or a "market-based" number of slot machines satisfies the IGRA's requirement of good faith. (302)

The FSST's claim that South Dakota is no longer a state of limited gaming is erroneous for several reasons. (303) First, gaming in Deadwood remains "numerically limited." (304) Although the number of gamin devices in Deadwood has increased from 2,085 in 1991 to 3,644 in 2008, (305) the total number of gaming devices available to a Deadwood license holder remains predetermined. (306) A gaming license limits a license holder to thirty gaming devices. (307) A license holder may only obtain three licenses. (308) Thus, a license holder in Deadwood may operate a maximum of ninety gaming devices. (309)

During this same time period, the number of gaming devices operated by the FSST has also increased. (310) In its original compact with the State, the FSST was limited to 180 gamin devices, twice the number of devices an individual in Deadwood may operate. (311) These 180 gaming devices included both card games and slot machines. (312) Shortly after this original compact took effect, the FSST increased its number of gaming devices from 180 to 250. (313) As a result, the FSST operates almost three times the number of gaming devices a license holder in Deadwood may acquire. (314) In 2000, an amended gaming compact was executed, and the FSST was once again awarded a substantial gaming device increase. (315) Under this amended gaming compact the FSST maintained its 250 slot machines, but was also awarded an unlimited number of blackjack tables. (316)

Second, gaming in Deadwood is "geographically limited. (317) Casino-style gaming is restricted to the city limits of Deadwood. (318) As such, Deadwood is the only non-tribal location in South Dakota where casino-style gaming is conducted. (319) When gaming reaches the boundaries of Deadwood's city limits as set in 1988, the gaming industry's growth will cease. (320) Therefore, today this geographic limitation thwarts any prospective developer from "cashing in" on Deadwood's gaming industry by opening a new gaming establishment outside of Deadwood's city limits. (321)

The geographic limitation protects the FSST's gaming operation from possible in-state competition because a non-tribal gaming entrepreneur cannot operate a casino-style facility in any other city, county, municipality, or township other than Deadwood. (322) The geographic limitation provides the Gaming Tribes with an enormous economic benefit because tribal casinos do not compete with privately-owned casino-style gaming facilities located in population centers such as Aberdeen, Brookings, Pierre, Rapid City, Sioux Falls, or Yankton. (323)

Third, South Dakota's types of games and bet limits remain limited. (324) Blackjack, poker, and slot machines are the only types of casino-style gaming allowed in Deadwood. (325) Additionally, Deadwood's bet limits which were originally limited to five dollars 326 are now limited to one hundred dollars. (327) Since the IGRA requires that the types of games and bet limits allowed in Deadwood must also be permitted at all tribal gaming facility, the FSST's gaming compact contains the identical types of games and bet limits of those offered in Deadwood. (328)

Fourth, a close examination of revenue information and the Cummings Report reveal that South Dakota has indeed adhered to its public policy of limited gaming. (329) There is little question that both Deadwood and the Gaming Tribes are "cashing in" on their respective gaming operations. (330) For example, from 1991 to 2008, Deadwood's gaming revenues increased from over $33 million (331) to over $101 million. (332) In 2003, Deadwood's casinos reported a "total win" of over $70.3 million. (333)

The Gaming Tribes' revenue reports are often not readily available, making comparisons difficult. (334) Despite the recent economic downturn, at least one of the Gaming Tribes, the FSST, reports that its gaming revenues increased substantially through July 2008. (335) In 2003, the Gaming Tribes tallied an estimated $75.3 million in total win. (336) As such, the Gaming Tribes' total win was almost $5 million greater than the total win derived from gaming in Deadwood in 2003. (337) In 2007, gaming revenue for the Gaming Tribes was reported at $97.1 million. (338) According to Casino City's Indian Gaming Industry Report, the total gaming revenue for Indian gaming facilities in South Dakota was down three percent between 2006 and 2007, from $100.1 million to $97.1 million in gaming revenue. (339) While reported gaming for all tribes in the South Dakota may have decreased between 2006 and 2007, the FSST reported a significant gain in gaming in July 2008. (340) Comparison of the revenues of the tribes and Deadwood casinos demonstrates that they are roughly equal, an argument which tends to show good faith on the part of the State, especially when the populations of the state and of the reservations are compared. (341)

Despite the fact that gaming has proven to be relatively profitable for those involved, gaming revenues in South Dakota remain limited. 2 Gaming revenue is not derived from Aberdeen or Brookings. (343) Gaming revenue is not derived from Sioux Falls or Yankton. (344) Instead, gaming revenue derives only from Deadwood and the Gaming Tribes. (345)

2. The State of South Dakota Has Acted in Good Faith in Compact Negotiations with the Flandreau Santee Sioux Tribe

Since the first class III tribal-state gaming compact was executed by Governor Mickelson with the FSST in 1990, the State has negotiated separate but nearly identical compacts with each Gaming Tribe. (346) As it has for the last two decades, the State has acted in good faith in its recent negotiations with the FSST, (347)

The FSST wants to build a destination resort with an unlimited or a market-based number of gaming devices. (348) However, South Dakota, consistent with its public policy of limited gaming, has declined to execute a compact that encompasses the FSST's demands. (349) After reviewing the factors that a court may consider when making a good faith determination under the IGRA, (350) South Dakota's position in these gaming compact negotiations with the FSST is entirely reasonable. (351)

In determining whether the State has acted in good faith, a district court may take into account several factors including the public interest, financial integrity, and adverse economic impacts on existing gaming activities. (352) The FSST's demand to substantially increase its slot machines and expand its gaming establishment will undoubtedly have a significant impact in these three areas. (353)

First, the State must acknowledge that the Cummings Report suggests additional ggaming revenues can be derived from "more, larger, or better facilities." (354) However, "more, larger, or better facilities" come with a price. (355) For instance, if the FSST is granted an additional 250 slot machines, the FSST would likely realize increased gross revenues of over $12.9 million. (356) However, the FSST's gain would result in a loss to Deadwood's gaming operations of $174,000 in revenue. (357) Video lottery revenue would decrease by $3.7 million. (358) The FSST's expansion would also negatively affect the other Gaming Tribes' gaming revenues. (359) Ironically, and perhaps most troubling, is that the other Gaming Tribes would experience a gaming revenue decrease of between 0.3% to 1.8%. (360)

Second, if the FSST is granted a significant increase in gaming devices, it is highly unlikely that the great revenue divide between the FSST and the other Gaming Tribes would be improved. (361) Great disparities exist among the revenues that are collected by each of the Gaming Tribes, and a significant expansion at the FSST's casino would likely not result in a decrease in the revenue disparities. (362)

Third, the IGRA's legislative history provides that a district court may consider the "economic interest in raising revenue for its citizens" when determining if a state has negotiated in good faith. (363) The revenues from state sanctioned gaming help fund state government projects which all citizens, Indian and non-Indian, are eligible for participation. (364) By allowing the FSST to increase its number of gaming devices, the State's financial support for these programs would be significantly decreased. (365)

IV. CONCLUSION

The IGRA was a congressional compromise solution to the difficult questions involving Indian gaming. The IGRA is an example of "cooperative federalism" in that it intends to balance the competing sovereign interests of the federal government, state governments, and Indian tribes, by providing each a function in the regulatory scheme. However, despite the IGRA's complex substantive and procedural framework, the Act does not address two fundamental issues.

First, the IGRA does not clarify whether the legislative or executive branch of state government is ultimately responsible for executing a gaming compact. It is likely that the South Dakota Constitution prevents the Governor from unilaterally executing gaming compacts.

Second, the IGRA requires that a state must negotiate a gaming compact with an Indian tribe in good faith. Although the IGRA fails to define good faith, by analyzing previous South Dakota litigation over the issue, it becomes apparent that the State of South Dakota has consistently negotiated in good faith with the Gaming Tribes. Furthermore, in its recent negotiations with the Flandreau Santee Sioux Tribe, the State has satisfied this good faith standard.

BROOKE DELORES SWIER, University of South Dakota School of Law, J.D. candidate, 2010. University of South Dakota, Ed. S. 2007. Mount Marty College, B.A. 2004. The author wishes to thank her parents for their love, support, and encouragement.

(1.) Texas v. United States, 497 F.3d 491, 493 (5th Cit. 2007).

(2.) See George Ledbetter, Gambling Returns to Deadwood Gulch, DEADWOOD GAMING YESTERDAY AND TODAY, at 1 (n.d.); Barbara Ordahl, Deadwood Puts History to Use, RAPID CITY J., May 7, 1989. See generally GOLD, GALS, GUNS, GUTS: A HISTORY OF DEADWOOD, LEAD, & SPEARFISH 1874-1976 (Bob Lee ed., South Dakota State Historical Society Press 2004) (1976).

(3.) See Blackjack Brings Back Taste of Old West in Deadwood, BLACK HILLS PIONEER, Jan. 14, 2000.

(4.) See Olson v. City of Deadwood, 480 N. W.2d 770, 779 (S.D. 1992); GOLD, GALS, GUNS, GUTS, supra note 2, at 141.

(5.) David Whitlock, Painted Ladies, Soiled Doves, and Prairie Nymphs: Prostitution Had a Long and Successful Run in Deadwood, BLACK HILLS PIONEER, Apr. 12, 2008; Brandon Bennett, Gambling Pays Off, BLACK HILLS PIONEER, Mar. 5, 2007.

(6.) Bennett, supra note 5.

(7.) Valerie Goodman, State Attorneys Look at Deadwood's Past, DEADWOOD GAMING YESTERDAY AND TODAY, at 7 (n.d.).

(8.) See Bennett, supra note 5.

(9.) 1987 S.D. Sess. Laws 432-40. The first state-sanctioned lottery was instant tickets. History, South Dakota State Lottery, http://www.sdlottery.org/history_of_lottery.asp (last visited Feb. 1, 2009) [hereinafter History].

(10.) Constitutional Amendment B: Deadwood Gambling, OFFICIAL ELECTION RETURNS AND REGISTRATION FIGURES FOR SOUTH DAKOTA: GENERAL ELECTION NOVEMBER 8, 1988, at 8 (1988). The constitutional amendment to allow "limited gaming" in Deadwood was passed by a vote of 191,745 to 106,444. Id. at 4.

(11.) S.D. CONST. art. 111, [section] 25 (amended 1994). The South Dakota Constitution states:
   The Legislature shall not authorize any game of chance, lottery, or
   gift enterprise, under any pretense, or for any purpose whatever
   provided, however, it shall be lawful for the Legislature to
   authorize by law, bona fide veterans, charitable, educational,
   religious or fraternal organizations, civic and service clubs,
   volunteer fire departments, or such other public spirited
   organizations as it may recognize, to conduct games of chance when
   the entire net proceeds of such games of chance are to be devoted
   to educational, charitable, patriotic, religious, or other public
   spirited uses. However, it shall be lawful for the Legislature to
   authorize by law a state lottery or video games of chance, or both,
   which are regulated by the [S]tate of South Dakota, either
   separately by the state or jointly with one or more states, and
   which are owned and operated by the [S]tate of South Dakota, either
   separately by the [S]tate or jointly with one or more states or
   persons, provided any such video games of chance shall not directly
   dispense coins or tokens. However, the Legislature shall not expand
   the statutory authority existing as of June 1, 1994, regarding any
   private ownership of state lottery games or video games of chance,
   or both. The Legislature shall establish the portion of proceeds
   due the state from such lottery or video games of chance, or both,
   and the purposes for which those proceeds are to be used. SDCL
   42-7A, and its amendments, regulations, and related laws, and all
   acts and contracts relying for authority upon such laws and
   regulations, beginning July 1, 1987, to the effective date of this
   amendment, are ratified and approved. Further, it shall be lawful
   for the Legislature to authorize by law, limited card games and
   slot machines within the city limits of Deadwood, provided that 60%
   of the voters of the City of Deadwood approve legislatively
   authorized card games and slot machines at an election called for
   such purpose. The entire net Municipal proceeds of such card games
   and slot machines shall be devoted to the Historic Restoration and
   Preservation of Deadwood.


Id. (emphasis added).

(12.) Indian Gaming Regulatory Act, Pub. L. No. 100-497, 102 Stat. 2467, 2469-72, 2479, 2481-87 (1988) (codified at 25 U.S.C. [section][section] 2701-2721 (1988) and 18 U.S.C. [section][section] 1166-1168 (1988)). See generally Kathryn R.L. Rand & Steven A. Light, Virtue or Vice? How IGRA Shapes the Politics of Native American Gaming, Sovereignty, and Identity, 4 VA. J. SOC. POL'Y & L. 381 (1997) (recognizing the outcomes of the IGRA); Kevin K. Washburn, Recurring Problems in Indian Gaming, 1 WYO. L. REV. 427 (2001) (discussing the legal controversies surrounding the IGRA); Keith David Bilezerian, Ante Up or Fold. States Attempt to Play Their Hand While Indian Casinos Cash In, 29 NEW ENG. L. REV. 463 (1995) (analyzing arguments used to prevent the building of gaming facilities); Joe Laxague, Note, Indian Gaming and Tribal-State Negotiations: Who Should Decide the Issue of Bad Faith?, 25 J. LEGIS. 77 (1999) (analyzing the Secretary of the Interior's role in the IGRA); Chris Rausch, Article, The Problem with Good Faith: The Indian Gaming Regulatory Act a Decade After Seminole, 11 GAMING L. REV. 423 (2007) (analyzing the difficulties which have arisen from the IGRA).

(13.) 25 U.S.C. [section] 2701 (2006). The Act states:

The Congress finds that--

(1) numerous Indian tribes have become engaged in or have licensed gaming activities on Indian lands as a means of generating tribal governmental revenue;

(2) Federal courts have held that section 81 of this title requires Secretarial review of management contracts dealing with Indian gaming, but does not provide standards for approval of such contracts;

(3) existing Federal law does not provide clear standards or regulations for the conduct of gaming on Indian lands;

(4) a principal goal of Federal Indian policy is to promote tribal economic development, tribal self-sufficiency, and strong tribal government; and

(5) Indian tribes have the exclusive right to regulate gaming activity on Indian lands if the gaming activity is not specifically prohibited by [f]ederal law and is conducted within a [s]tate which does not, as a matter of criminal law and public policy, prohibit such gaming activity.

Id.

(14.) See S.D. CONST. art. III, [section] 25 (amended 1994); 25 U.S.C. [section] 2701 (2006). See supra notes 11 and 13 for text of the constitution and the statute, respectively. See infra note 135 for a listing of all tribal-state gaming compacts in South Dakota.

(15.) See infra Part II.A.

(16.) See infra Part II.B.

(17.) See infra Part II.B.3.

(18.) See infra Part II.C.

(19.) See infra Part II.D.

(20.) See infra Part III.A.

(21.) See infra Part III.B.1.

(22.) See infra Part III.B.2.

(23.) KATHRYN R.L. RAND & STEVEN ANDREW LIGHT, INDIAN GAMING LAW AND POLICY 21 (2006) [hereinafter RAND & LIGHT, LAW AND POLICY]; RENEE ANN CRAMER, CASH, COLOR, AND COLONIALISM: THE POLITICS OF TRIBAL ACKNOWLEDGEMENT 86-87 (2005). Several Courts decided litigation concerning the legality of bingo halls in the early to mid-1980s. United States v. Dakota, 796 F.2d 186 (6th Cir. 1986) (finding the gambling operation was illegal because commercial gambling violated state law and the Organized Crime Control Act of 1970); Seminole Tribe of Fla. v. Butterworth, 658 F.2d 310 (5th Cit. 1981) (stating the operation of a bingo hall by the Seminole Indian Tribe was not contrary to public policy and was permitted on the reservation); United States v. Farris, 624 F.2d 890 (9th Cir. 1980) (concluding that the state could not enforce gambling laws against the Puyallup Indian Tribe on reservation land but could enforce laws against non-Indians on the reservation).

(24.) RAND & LIGHT, LAW AND POLICY, supra note 23, at xiii-xiv. See University of North Dakota Tribal Gaming Law & Policy, http://www.law.und.nodak.edu/npilc/gaming/ index.php (last visited Jan. 19, 2009). The Institute for the Study of Tribal Gaming Law and Policy (Institute) offers both legal and policy support for tribal gaming enterprises to governments and organizations. Id. The Institute also assists tribes in pursuing economic development and building tribal governments. Id. The Institute's primary focus in on issues facing tribes in the Great Plains, including South Dakota. Id. "The Institute offers an interdisciplinary perspective on tribal gaming, incorporating law, political science, and public administration." Id.

(25.) RAND &LIGHT, LAW AND POLICY, supra note 23, at 21.

(26.) 480 U.S. 202 (1987).

(27.) Id. at 205. The games were played mostly by non-Indian patrons and were a major source of income for the tribe. Id.

(28.) Id.

(29.) Id.

(30.) Id. at 207. The Court held that through Public Law 280, California was "granted broad criminal jurisdiction over offenses committed by or against Indians within all Indian country within the state." Id. Through Public Law 280, if the intent of a state law is to prohibit conduct, it is within a state's Public Law 280 jurisdiction. Id. However, if a state law generally permits the conduct, the conduct is classified as civil/regulatory and under Public Law 280, the state does not have authority of enforcement on Indian land. Id.

(31.) Id. at 209.

(32.) Id. at 210.

(33.) Id. at 221-22.

(34.) FELIX S. COHEN, COHEN's HANDBOOK OF FEDERAL INDIAN LAW 859 (Nell Jessup Newton et al. eds., LexisNexis 2005).

(35.) Pub. L. No. 100-497, 102 Star. 2467, 2469-72, 2479, 2481-87 (1988) (codified at 25 U.S.C. [section][section] 2701-2721 (1988) & 18 U.S.C. [section][section] 1166-68 (1988)); Cabazon, 480 U.S. 202. See G. WILLIAM RICE, TRIBAL GOVERNMENTAL GAMING LAW CASES AND MATERIALS 71 (2006).

(36.) COHEN, supra note 34, at 859. See Pueblo of Santa Ana v. Kelly, 104 F.3d 1546, 1548 (10th Cir. 1997). See generally Wendy J. Johnson, Tribal Gaming Expansion in Oregon, 37 WILLAMETTE L. REV. 399 (2001) (analyzing the effects of expanded gaming); Steve J. Coleman, Note, Lottery Logistics: The Potential Impact of a State Lottery on Indian Gaming in Oklahoma, 27 AM. INDIAN L. REV. 515 (2002-03) (discussing the scope of gaming and the impact of a state-sanctioned lottery); K. Alexa Koenig, Comment, Gambling on Proposition 1A: The California Indian Self-Reliance Amendment, 36 U.S.F. L. REV. 1033 (2002) (examining difficulties with California's compacting process); Nancy McKay, Comment, The Meaning of Good Faith in the Indian Gaming Regulatory Act, 27 GONZ. L. REV. 471 (1991-92) (discussing the "good faith" provision of the IGRA); Mark C. Wenzel, Note, Let the Chips Fall Where They Maya The Spokane Indian Tribe's Decision to Proceed With Casino Gambling Without a State Compact, 30 GONZ. L. REV. 467 (1994-95) (discussing tribal-state gaming compact challenges).

(37.) 25 U.S.C. [section] 2702(2) (2006). One of the purposes of the Act is:
   to provide a statutory basis for the regulation of gaming by an
   Indian tribe adequate to shield it from organized crime and other
   corrupting influences, to ensure that the Indian tribe is the
   primary beneficiary of the gaming operation, and to assure that
   gaming is conducted fairly and honestly by both the operator and
   players[.]


Id.

(38.) Id. [section] 2702(1)-(2).

(39.) Artichoke Joe's v. Norton, 216 F. Supp. 2d 1084, 1092 (E.D. Cal. 2002).

(40.) 25 U.S.C. [section] 2703(5). Under the IGRA, the term "Indian tribe" is defined as: any Indian tribe, band, nation, or other organized group or community of Indians which

(A) is recognized as eligible by the Secretary for the special programs and services provided by the United States to Indians because of their status as Indians and

(B) is recognized as possessing powers of self-government.

Id.

(41.) Id. [section] 2703(4). Under the IGRA, the term "Indian lands" is defined as:

(A) all lands within the limits of any Indian reservation;

(B) and any lands title to which is either held in trust by the United States for the benefit of any Indian tribe or individual or held by any Indian tribe or individual subject to restriction by the United States against alienation and over which an Indian tribe exercises governmental power.

Id.

(42.) 25 U.S.C. [section] 2702(3) (1992). The National Indian Gaming Commission's:
   primary mission is to regulate gaming activities on Indian lands
   for the purpose of shielding Indian tribes from organized crime and
   other corrupting influences; to ensure that Indian tribes are the
   primary beneficiaries of gaming revenue; and to assure that gaming
   is conducted fairly and honestly by both operators and players.

   To achieve these goals, the Commission is authorized to conduct
   investigations; undertake enforcement actions, including the
   issuance of violation, assessment of civil fines, and/or issuance
   of closure orders; conduct background investigations; conduct
   audits; and review and approve Tribal gaming ordinances.


National Indian Gaming Commission, http://www.nigc.gov/ (last visited Jan. 19, 2009).

(43.) Wis. Winnebago Nation v. Thompson, 22 F.3d 719, 721 (7th Cir. 1994).

(44.) See 25 U.S.C. [section] 2703 (2006); Id. [section] 2710.

(45.) RAND & LIGHT, LAW AND POLICY, supra note 23, at 46.

(46.) 25 U.S.C. [section] 2703(6).

(47.) Id. [section] 2710(a)(1).

(48.) Id. [section] 2703(7)(A)-(D). The Act states:

(7)(A) The term "class 11 gaming" means

(i) the game of chance commonly known as bingo (whether or not electronic, computer, or other technological aids are used in connection therewith)

(I) which is played for prizes, including monetary prizes, with cards bearing numbers or other designations,

(II) in which the holder of the card covers such numbers or designations when objects, similarly numbered or designated, are drawn or electronically determined, and

(III) in which the game is won by the first person covering a previously designated arrangement of numbers or designations on such cards, including (if played in the same location) pull-tabs, lotto, punch boards, tip jars, instant bingo, and other games similar to bingo, and

(ii) card games that

(I) are explicitly authorized by the laws of the [s]tate, or

(ii) are not explicitly prohibited by the laws of the State and are played at any location in the [s]tate,

but only if such card games are played in conformity with those laws and regulations (if any) of the [s]tate regarding hours or periods of operation of such card games or limitations on wagers or pot sizes in such card games.

Id. [section] 2703(A).

(49.) Id. [section] 2703(7)(B). The Act explains, "[t]he term 'class 11 gaming' does not include--(i) any banking card games, including baccarat, chemin de fer, or blackjack (21), or (ii) electronic or electromechanical facsimiles of any game of chance or slot machines of any kind." Id.

(50.) Id. [section] 2710(a)(2). According to the Act, "[a]ny class II gaming on Indian lands shall continue to be within the jurisdiction of the Indian tribes, but shall be subject to the provisions of this chapter." Id.

(51.) Id. [section] 2710(b)(2). According to the Act:

(2) The Chairman shall approve any tribal ordinance or resolution concerning the conduct, or regulation of class 11 gaming on the Indian lands within the tribe's jurisdiction if such ordinance or resolution provides that--

(A) except as provided in paragraph (4), the Indian tribe will have the sole proprietary interest and responsibility for the conduct of any gaming activity;

(B) net revenues from any tribal gaming are not used for purposes other than (i) to fund tribal government operations or programs; (ii) to provide for the general welfare of the Indian tribe and its members; (iii) to promote tribal economic development; (iv) to donate to charitable organizations; or (v) to help fund operations of local government agencies;

(C) annual outside audits of gaming, which may be encompassed within existing independent tribal audit systems, will be provided by the Indian tribe to the Commission;

(D) all contracts for supplies, services, or concessions for a contract amount in excess of $25,000 annually (except contracts for professional legal or accounting services) relating to such gaming shall be subject to such independent audits;

(E) the construction and maintenance of the gaming facility, and the operation of that gaming is conducted in a manner which adequately protects the environment and the public health and safety; and

(F) there is an adequate system which

(i) ensures that background investigations are conducted on the primary management officials and key employees of the gaming enterprise and that oversight of such officials and their management is conducted on an ongoing basis; and

(ii) includes--

(I) tribal licenses for primary management officials and key employees of the gaming enterprise with prompt notification to the Commission of the issuance of such licenses;

(II) a standard whereby any person whose prior activities, criminal record, if any, or reputation, habits and associations pose a threat to the public interest or to the effective regulation of gaming, or create or enhance the dangers of suitable, unfair, or illegal practices and methods and activities in the conduct of gaming shall not be eligible for employment; and

(III) notification by the Indian tribe to the Commission of the results of such background check before the issuance of any of such licenses.

Id.

(52.) 25 U.S.C. [section] 2703(8) (1992). The Act states, "[t]he term 'class III gaming' means all forms of gaming that are not class I gaming or class II gaming." Id. See COHEN, supra note 34, at 859-60; CONFERENCE OF WESTERN ATTORNEYS GENERAL, AMERICAN INDIAN LAW DESKBOOK 435 (3d ed. 2004).

(53.) 25 U.S.C. [section] 2710(d)(1)(A)-(C) (2006). According to the Act:

(1) Class III gaming activities shall be lawful on Indian lands only if such activities are--

(A) authorized by an ordinance or resolution that--

(i) is adopted by the governing body of the Indian tribe having jurisdiction over such lands,

(ii) meets the requirements of subsection (b) of this section, and

(iii) is approved by the Chairman,

(B) located in a [s]tate that permits such gaming for any purpose by any person, organization, or entity, and

(C) conducted in conformance with a [t]ribal-[s]tate compact entered into by the Indian tribe and the [s]tate under paragraph (3) that is in effect.

Id.

(54.) 25 U.S.C. [section] 2710(d)(1)(A) (2006).

(55.) Id. [section] 2710(d)(1)(B).

(56.) Id. [section] 2710(d)(1)(C). Although not specifically defined by 25 U.S.C. [section] 2710(d)(1)(C), other sources have defined the term "compact." See BLACK'S LAW DICTIONARY 120 (3d pocket ed. 1996) ("An agreement or covenant between two or more parties, esp[ecially] between governments or states."); Petty v. Tenn.-Mo. Bridge Comm'n, 359 U.S. 275, 285 (1959) ("A Compact, is after all, a contract."); State ex rel. Dyer v. Sims, 341 U.S. 22, 27 (1951) (defining a compact as "a supple device for dealing with interests confined within a region").

(57.) CONFERENCE OF WESTERN ATTORNEYS GENERAL, supra note 52, at 416. The gaming compact has been described as "both novel and complex in approach." Id. at 445. The Senate Report viewed the compact approach as the "best mechanism to assure that the interests of both sovereign entities are met with respect to the regulation of complex gaming enterprises." S. REP. No. 100-446, at 13 (1988), as reprinted in 1988 U.S.C.C.A.N. 3071.

(58.) Cheyenne River Sioux Tribe v. South Dakota, 3 F.3d 273, 275 (8th Cir. 1993).

(59.) 25 U.S.C. [section] 2710(d)(3)(A). The Act explains:
   Any Indian tribe having jurisdiction over the Indian lands upon
   which a class III gaming activity is being conducted, or is to be
   conducted, shall request the [s]tate in which such lands are
   located to enter into negotiations for the purpose of entering into
   a [t]ribal-[s]tate compact governing the conduct of gaming
   activities. Upon receiving such a request, the [s]tate shall
   negotiate with the Indian tribe in good faith to enter into such a
   compact.


Id.

(60.) Id.

(61.) Id. [section] 2710(d)(3)(B). The Act explains:
   Any [s]tate and any Indian tribe may enter into a [t]ribal-[s]tate
   compact governing gaming activities on the Indian lands of the
   Indian tribe, but such compact shall take effect only when notice
   of approval by the Secretary of such compact has been published by
   the Secretary in the Federal Register.


Id.

(62.) CONFERENCE OF WESTERN ATTORNEYS GENERAL, supra note 52, at 449. See 25 U.S.C. [section] 2710(d)(3)(C)(i)-(ii).

(63.) Id. [section] 2710(d)(3)(C)(i)-(vii). According to the Act:

(C) Any [t]ribal-[s]tate compact negotiated under subparagraph (A) may include provisions relating to--

(i) the application of the criminal and civil laws and regulations of the Indian tribe or the State that are directly related to, and necessary for, the licensing and regulation of such activity;

(ii) the allocation of criminal and civil jurisdiction between the [s]tate and the Indian tribe necessary for the enforcement of such laws and regulations;

(iii) the assessment by the [s]tate of such activities in such amounts as are necessary to defray the costs of regulating such activity;

(iv) taxation by the Indian tribe of such activity in amounts comparable to amounts assessed by the [s]tate for comparable activities;

(v) remedies for breach of contract;

(vi) standards for the operation of such activity and maintenance of the gaming facility, including licensing; and

(vii) any other subjects that are directly related to the operation of gaming activities.

Id.

(64.) Id.

(65.) 25 U.S.C. [section] 2710(d)(7)(A)-(B).

(66.) Id. [section] 2710(d)(7)(B)(ii).

(67.) See generally id. [section] 2710(d)(3)(A).

(68.) 25 U.S.C. [section] 2710(d)(7)(B)(iii) (1988). The Act states:

(iii) If, in any action described in subparagraph (A)(i), the court finds that the [s]tate has failed to negotiate in good faith with the Indian tribe to conclude a [t]ribal-[s]tate compact governing the conduct of gaming activities, the court shall order the [s]tate and the Indian [t]ribe to conclude such a compact within a 60-day period. In determining in such an action whether a [s]tate has negotiated in good faith, the court- (1) may take into account the public interest, public safety, criminality, financial integrity, and adverse economic impacts on existing gaming activities, and (II) shall consider any demand by the [s]tate for direct taxation of the Indian tribe or of any Indian lands as evidence that the [s]tate has not negotiated in good faith.

Id. See S. REP. NO. 100-446 (1988), as reprinted in 1988 U.S.C.C.A.N. 3071,3083-84 (providing additional factors to consider in determining if a state has negotiated in good faith).

(69.) 25 U.S.C. [section] 2710(d)(7)(B)(iii).

(70.) S. REP. NO. 100-446, at 13 (1988), as reprinted in 1988 U.S.C.C.A.N. 3071, 3083-84. This section is also excerpted in Indian Gaming Related Cases v. California, 331 F.3d 1094, 1108-09 (9th Cir. 2003).

(71.) S. REP. NO. 100-446, at 13 (1988), as reprinted in 1988 U.S.C.C.A.N. 3071, 3083-84. This section is also excerpted in Indian Gaming Related Cases, 331 F.3d at 1108-09.

(72.) 25 U.S.C. [section] 2710(d)(7)(B)(iii).

(73.) Id. [section] 2710(d)(7)(B)(iv). The Act explains:
   If a [s]tate and an Indian tribe fail to conclude a
   [t]ribal-[s]tate compact governing the conduct of gaming activities
   on the Indian lands subject to the jurisdiction of such Indian
   tribe within the 60-day period provided in the order of a court
   issued under clause (iii), the Indian tribe and the [s]tate shall
   each submit to a mediator appointed by the court a proposed compact
   that represents their last best offer for a compact. The mediator
   shall select from the two proposed compacts the one which best
   comports with the terms of this chapter and any other applicable
   Federal law and with the findings and order of the court.


Id.

(74.) Id.

(75.) 25 U.S.C. [section] 2710(d)(7)(B)(vii). According to the Act:
   (vii) If the [s]tate does not consent during the 60-day period
   described in clause (vi) to a proposed compact submitted by a
   mediator under clause (v), the mediator shall notify the Secretary
   and the Secretary shall prescribe, in consultation with the Indian
   tribe, procedures--(I) which are consistent with the proposed compact
   selected by the mediator under clause (iv), the provision of this
   chapter, and the relevant provisions of the laws of the [s]tate,
   and (II) under which class III gaming may be conducted on the
   Indian lands over which the Indian tribe has jurisdiction.


Id.

(76.) 25 U.S.C. [section] 2710(d)(7)(D) (2006). According to the Act, "[t]he Secretary shall publish in the Federal Register notice of any [t]ribal-[s]tate compact that is approved, or considered to have been approved, under this paragraph." Id.

(77.) S.D. CONST. (1889). See Poppen v. Walker, 520 N.W.2d 238, 240 (S.D. 1994).

(78.) S.D. CONST. art. III, [section] 25 (1889); Poppen, 520 N.W.2d at 240.

(79.) See S.D. CONST. art. III, [section] 25 (1889). See also Poppen, 520 N.W.2d at 240 (tracing the recent evolution of gaming in South Dakota). During the 2009 Legislative Session, a Senate Joint Resolution "to propose a constitutional amendment to authorize the Legislature on the advice of the Governor, to forestall certain threats from interstate gaming" was proposed to amend the South Dakota Constitution. S.J.R. 1, 2009 Leg., 84th Sess. (S.D. 2009), available at http://legis.state.sd.us/sessions/2009/Bill.aspx?Bill=SJR1. At the next general election held in South Dakota, the following amendment to Article III of the constitution would have been presented to the voters for approval:
   [section] 33. The Legislature may, notwithstanding the provisions
   of Article 111, section 25, authorize any game of change, lottery,
   or gift enterprise if it is reasonably necessary to prevent the
   initiation or curtail the operation of some form of legal gaming in
   a bordering state that will constitute a serious impediment to the
   economic propensity or social well-being of the citizenry of any
   significant portion of the State of South Dakota.

   Before the Legislature may exercise its statutory authority
   pursuant to this section, the Governor must find, and declare in
   writing to the presiding officers of the Legislature and the
   secretary of state, that such a situation either currently exists
   or is imminently threatened and that prompt action by the
   Legislature in regular or special session, is appropriate under the
   circumstances.


Id. The proposed Senate Joint Resolution was approved by the Senate by a vote of twenty to fifteen. Id However, the Senate Joint Resolution was deferred to the forty-first legislative day by House State Affairs. Id.

(80.) See generally S.D. CONST. art. III, [section] 25 (amended 1994).

(81.) Constitutional Amendment B, OFFICIAL ELECTION RETURNS AND REGISTRATION FIGURES FOR SOUTH DAKOTA: GENERAL ELECTION NOVEMBER 4, 1986, at 15 (1986). The constitutional amendment stated: "[a] joint resolution proposing and submitting to the electors at the next general election an amendment to Article III of the Constitution of the State of South Dakota, relating to the authorization of a state lottery." Id. The Attorney General's explanation of the proposed amendment stated,
   This proposed Constitutional Amendment would:
   permit the legislature to authorize a state lottery, to be state
   regulated, controlled, owned, and operated, either separately by
   South Dakota, or in cooperation with one or more other states; the
   net proceeds of which would be used for any purpose the Legislature
   should choose. The Constitution does not presently allow the
   [s]tate to operate a lottery.


Id. at 15. The constitutional amendment to allow a state lottery passed by a margin of 163,005 for and 110,153 against. Id at 12.

(82.) 1987 S.D. Sess. Laws 432-40. The first instant ticket was sold on September 30, 1987. History, supra note 9.

(83.) SOUTH DAKOTA LEGISLATIVE RESEARCH COUNCIL, 31ST INTERIM REPORT TO THE 1988 LEGISLATURE 30-31 (1987). The Lottery Study Committee studied the implementation of instant lottery, the feasibility of on-line lottery games operated independently by the state, and the viability of video lottery games into the state lottery. Id.

(84.) S.B. l, 1988 Leg., 63rd Sess. (S.D. 1988).

(85.) History, supra note 9. See generally SOUTH DAKOTA LEGISLATIVE RESEARCH COUNCIL, 31 ST INTERIM REPORT TO THE 1988 LEGISLATURE 30-31 (1987).

(86.) 1990 S.D. Sess. Laws 463-68; History, supra note 9. The Indian tribes throughout the state are also permitted to engage in video lottery. S.D.C.L. [section] 42-7A-19.1 (2004). The statute states:
   The commission may provide for the sale of lottery products within
   the exterior boundaries of any Indian reservation within this
   state. The commission may pay to the respective tribal government
   an amount not to exceed fifty percent of the state's net proceeds
   from lottery products sold within the exterior boundaries of any
   reservation. The commission shall consider any agreement or
   potential agreement made pursuant to the authority contained in the
   Federal Indian Gaming Act together with any other relevant factors,
   including tribal member and nonmember mix, in determining payment
   to be made to a tribe. The commission shall by rule, promulgated
   pursuant to chapter 1-26, establish the specific criteria to
   determine the amount of net proceeds distributed to each tribal
   government. Each reservation may only receive revenue pursuant to
   this chapter from lottery products sold within the exterior
   boundaries of such reservation. Transfers of net proceeds from the
   sale of any lottery product to tribal governments under this
   section shall be made each year pursuant to [section] 42-7A-24.


Id. Video lottery is permitted throughout the state. S.D.C.L. [section] 42-7A-10 (2006). The statute states:
   The executive director shall select as lottery retailers such
   persons as he deems best able to serve the public convenience and
   promote the sale of tickets. In the selection of lottery retailers,
   the executive director shall consider factors such as financial
   responsibility, security of the applicant's place of business or
   activity, accessibility of the applicant's place of business or
   activity, integrity, reputation, sufficiency of existing lottery
   retailers to serve the public convenience, volume of expected
   sales, and such other factors as the executive director may deem
   appropriate. Any person lawfully engaged in nongovernmental
   business on state property may be selected as lottery retailers.


Id.

(87.) Initiated Measure 4, OFFICIAL ELECTION RETURNS AND REGISTRATION FIGURES FOR SOUTH DAKOTA: GENERAL ELECTION NOVEMBER 3, 1992, at 9 (1992). The initiated measure was titled, "An act to repeal the video lottery." Id. The Attorney General's explanation of the measure stated:
   In 1989, the Legislature authorized the South Dakota Lottery
   Commission to offer video lottery games to the public. The
   Commission has implemented rules for conducting games and has given
   licenses for machines throughout the state. Income from video
   lottery games is split between the state general fund, [sic] and
   the private sector.
   If passed, this initiative would repeal all statutory provisions
   authorizing video lottery games.


Id. The initiated measure to repeal video lottery failed by a margin of 122,298 in favor of and 207,607 against. Id. at 7. South Dakota's lottery was approved by the Legislature in 1990. 1990 S.D. Sess. Laws 465. The South Dakota Legislature approved:

(17) "Instant lottery," a game that offers preprinted tickets that indicate immediately or in a grand prize drawing whether the player has own a prize; and

(18) "On-line lottery," a game linked to a central computer via a telecommunications network in which the player selects a specified group of numbers or symbols out of a predetermined range of numbers or symbols as approved by the commission.

Id.

(88.) See Poppen v. Walker, 520 N.W.2d 238 (S.D. 1994).

(89.) 520 N.W.2d 238.

(90.) Id. at 248. The court held that video lottery was in violation of article 111, section 25 of the South Dakota Constitution. Id.

(91.) Id.

(92.) See id. See also History, supra note 9. Per a court order, video lottery ceased operation on August 12, 1994. Id.

(93.) History, supra note 9.

(94.) JOYCE HAZELTIN, LEGISLATIVE MANUAL: SOUTH DAKOTA 1995, at 290 (Patty Pearson ed., 1995). Constitutional Amendment E was titled "[a]n amendment to section 25 of Article III of the Constitution of the state of South Dakota, relating to the state lottery and video games of chance." The Attorney General's explanation of the proposed amended stated:
   The Constitution authorizes the [s]tate to own, operate and
   regulate a "lottery," but prohibits "games of chance." In June
   1994, the [South Dakota] Supreme Court ruled that the current video
   lottery system, created in 1989, is a "game of chance" rather than
   a "lottery." This amendment allows the lottery system to continue
   operating as it did before the court decision. The amendment will
   discourage lawsuits against the state treasury. The amendment also
   prohibits expansion of private ownership, and prohibits state-wide
   slot machines.


Id. A constitutional amendment to allow the state lottery and video lottery was passed with 165,185 for and 147,680 against. Id. at 287.

(95.) CHRIS NELSON, LEGISLATIVE MANUAL: SOUTH DAKOTA 2007, at 281. A constitutional amendment to repeal video lottery failed in 2000 by a vote of 146,428 to 169,642. JOYCE HAZELTIN, LEGISLATIVE MANUAL: SOUTH DAKOTA 2001-2002, at 257 (Argus Publishing Inc. 2002). In 2006, an initiated measure to repeal video lottery again failed by a margin of 110,032 to 222,889. CHRIS NELSON, LEGISLATIVE MANUAL: SOUTH DAKOTA 2007, at 276.

(96.) Olson v. City of Deadwood, 480 NW.2d 770, 779 (S.D. 1992).

(97.) Whitlock, supra note 5.

(98.) Id.

(99.) Goodman, supra note 7, at 7-8.

(100.) Id. at 8.

(101.) Orders Machines Burned: Gambling Equipment Seized in Raid Will Be Destroyed, DEADWOOD PIONEER-TIMES, August 20, 1947; Ordahl, supra note 2. Five night clubs, including the Bodega, Buffalo, Eagle Inn, Old Style, and Gold Bar, were raided and all managers and operators were arrested. Orders Machines Burned, supra. The seized equipment was estimated to be worth $20,000 to $25,000. Id. The South Dakota Legislature ordered Attorney General Anderson to "crackdown on gambling." Ordahl, supra note 2.

(102.) Orders Machines Burned, supra note 101. The machines were ordered to be burned with the sheriff, state's attorney, and county judge present. Id. The mangers of the clubs were fined $250 plus costs and the operators were fined $25 plus costs. Id.

(103.) Whitlock, supra note 5.

(104.) Goodman, supra note 7, at 8.

(105.) Id. at 7.

(106.) Id.

(107.) Id.

(108.) Id.

(109.) Bennett, supra note 5.

(110.) Id. The "Deadwood You Bet" Committee was formed by seven individuals trying to revitalize Deadwood's downtown. Id.

(111.) Id.

(112.) Id.

(113.) See id The Committee spent the year of 1988 campaigning for legalized gambling in Deadwood, attending meetings, and riding in parades. Id.

(114.) S.D. CONST. art. III, [section] 25 (amended 1994); Constitutional Amendment B. Deadwood Gambling, OFFICIAL ELECTION RETURNS AND REGISTRATION FIGURES FOR SOUTH DAKOTA: GENERAL ELECTION NOVEMBER 8, 1988, at 8 (1988). The "Deadwood Amendment" was passed by a vote of 191,745 to 106,444. Id. at 4. See supra note 11 for the text of the S.D. CONST. art. 111, [section] 25.

(115.) Constitutional Amendment B: Deadwood Gambling, OFFICIAL ELECTION RETURNS AND REGISTRATION FIGURES FOR SOUTH DAKOTA: GENERAL ELECTION NOVEMBER 8, 1988, at 8 (1988).

(116.) S.D.C.L. [section] 42-7B-1 (1989). The statute states:
   Limited card games and slot machines are hereby authorized, and may
   be operated and maintained, within the city limits of Deadwood,
   South Dakota, subject to the provisions of this chapter. The city
   of Deadwood must first approve the limited card games and slot
   machines by sixty percent of the votes cast at an election called
   for this purpose. The form of the question to be submitted to the
   voters is "Shall the city of Deadwood allow limited card games and
   slot machines?"


Id.

(117.) Id.

(118.) S.D.C.L. [section] 42-7B-14 (1989). The statute declared that "the amount of a bet may not be more than five dollars on the initial bet or subsequent bet subject to rules promulgated by the commission." Id.

(119.) S.D.C.L. [section] 42-7B-61 (1989). The statute stated, "a full complement of limited card games and slot machines may not exceed fifteen per retail license." Id.

(120.) S.D. CONST. art. III, [section] 25 (amended 1988); S.D.C.L. [section] 42-7B-1 (1989). If the voters of Deadwood failed to approve gaming, the provisions enacted by the South Dakota Legislature would have been repealed. S.D.C.L. [section] 42-7B-2 (1989). The statute provided:
   No gaming is allowed under the authority of this chapter until the
   question to be submitted pursuant to [section] 42-78-1 is approved
   by the voters of Deadwood, and until this chapter is implemented
   through the grant of applicable licenses by the South Dakota
   commission on gaming. If the voters of Deadwood fail to approve the
   question to be submitted pursuant to [section] 42-7B-1 by July 1,
   1989, the provisions of this chapter are repealed as of that date.


Id.

(121.) S.D.C.L. [section] 42-7B-1 (1989). The Commission Note accompanying the statute states Deadwood's voters passed the ballot question by a margin of 690 to 230. Id.

(122.) See S.D.C.L. [section] 42-7B (2004). See also S.D. ADMIN. R. 20:18 (2006).

(123.) S.D.C.L. [section] 42-7B-14 (1989). The statute states "[t]he amount of a bet may not be more than five dollars on the initial bet or subsequent bet subject to rules promulgated by the commission." Id.

(124.) S.D.C.L. [section] 42-7B-14 (2004). The statute sets "[t]he maximum amount of an initial bet or subsequent bet on all games subject to this chapter is the maximum bet limit (one hundred dollars) allowed on blackjack in any jurisdiction in South Dakota in effect on January 1, 1999." Id.

(125.) See generally id.

(126.) S.D.C.L. [section] 42-7B-16 (2004); id. [section] 42-7B-18. S.D.C.L. [section] 42-7B-16 states, "[a] full compliment of limited card games and slot machines may not exceed thirty per retail license." Id. S.D.C.L. [section] 42-71318 states:
   The retail space of a licensee shall be identified by a physical
   layout within a building, called the retail floor plan. The retail
   floor plan showing the location of each gaming device shall be
   submitted to the commission at the time of application, and is
   subject to prior approval by the Deadwood City Commission. Approval
   is subject to gaming rules and those rules pertaining to public
   health, safety, good order and general welfare of the City of
   Deadwood. The retail gaming license may only be granted to the
   retailer. All gaming devices shall be located within the retail
   space of the business. The number of gaming devices may not exceed
   thirty per building.


Id.

(127.) S.D.C.L. [section] 42-7B-22; id. [section] 42-7B-26. S.D.C.L. [section] 42-7B-22 states:

The commission may issue the following types of licenses which are required to conduct gaming under this chapter:

(1) Slot machine manufacturer or distributor. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year in the sum of two hundred fifty dollars. A slot machine manufacturer or distributor may not be licensed as a route operator, operator, or retailer;

(2) Operator license. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year of two hundred dollars;

(3) Retail license. The license fee is two hundred fifty dollars and thereafter an annual fee renewable July first of each year of one hundred dollars;

(4) Support license. The license fee is fifty dollars and thereafter an annual fee renewable January first of each year of twenty-five dollars. This license is required by all persons seeking employment in the field of gaming;

(5) Key employee license. The license fee is one hundred fifty dollars and thereafter an annual fee renewable January first of each year of seventy-five dollars;

(6) Route operator license. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year of two hundred dollars. Each route operator shall also hold a valid operator license.

Conducting gaming without the appropriate license is a Class 6 felony.

Id. S.D.C.L. [section] 42-7B-26 states, "[n]o person may have a financial interest in more than three retail licenses." Id.

(128.) JOHN HENRY GLOVER, TRIBAL SOVEREIGNS OF SOUTH DAKOTA: A DESCRIPTION OF CONTEMPORARY Sioux GOVERNMENTS (2005). The federally-recognized Indian tribes in South Dakota are the Cheyenne River Sioux Tribe, Crow Creek Sioux Tribe, Flandreau Santee Sioux Tribe, Lower Brule Sioux Tribe, Oglala Sioux Tribe, Rosebud Sioux Tribe, Sisseton-Wahpeton Sioux Tribe, Standing Rock Sioux Tribe, and Yankton Sioux Tribe. Id.

(129.) See Cheyenne River Sioux Tribe v. South Dakota, 3 F.3d 273 (8th Cir. 1993).

(130.) Id. at 276.

(131.) Id.

(132.) Id.

(133.) Original Flandreau Santee Sioux Tribe Gaming Compact, infra note 135 [section][section] 8.5, 11. For example, if the FSST operated 5 blackjack tables, it could also operate 175 slot machines. See generally id. [section] 8.5. The initial compact between the FSST and the State allowed blackjack, poker, and slot machines. Id. [section] 3.

(134.) Id. [section] 8.5. The "acceleration" provision was to be invoked when:

a) At least nine months have elapsed since the tribal gaming establishment was open for business; and

b) That within the last 60 consecutive business days from the date of determining whether these conditions have been met, 75 percent of the projected adjusted gross revenue (as defined by the South Dakota Commission on Gaming rules and regulations) per device per day has been realized on the average on all 180 devices. The projected adjusted gross revenue, for purposes of this calculation, shall be $85.00 per device per day.

Id.

(135.) Cheyenne River Sioux Tribe and State of South Dakota, Gaming Compact of 1993, September 27, 1993 [hereinafter Original Cheyenne River Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Cheyenne%20River%20Sioux%20-%2OGaming%2O Compacts.pdf, Crow Creek Sioux Tribe and State of South Dakota, Gaming Compact of 1991, October 4, 1991 [hereinafter Original Crow Creek Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Crow%20Creek%20Sioux%20-%2OGaming%2O Compacts.pdf, Flandreau Santee Sioux Tribe and State of South Dakota, Gaming Compact of 1990, June 29, 1990 [hereinafter Original Flandreau Santee Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Flandreau%20Sioux%20%2OGaming%2O Compacts.pdf, Lower Brule Sioux Tribe and State of South Dakota, Gaming Compact of 1991, July 9, 1991 [hereinafter Original Lower Brule Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Lower%20Brule%20Sioux%20-%2OGaming%2O Compacts.pdf, Oglala Sioux Tribe and State of South Dakota, Gaming Compact of 1993, August 25, 1993 [hereinafter Original Oglala Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Oglala%20Sioux%20-%2OGaming%2OCompacts.pdf, Rosebud Sioux Tribe and State of South Dakota, Gaming Compact of 1993, February 4, 1993 [hereinafter Original Rosebud Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Rosebud%20Sioux%20%2OGaming%2OCompacts.pdf, Sisseton-Wahpeton Sioux Tribe and State of South Dakota, Gaming Compact of 1990, December 31, 1990 [hereinafter Original Sisseton-Wahpeton Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Sisseton-Wahpeton%20Sioux%20-%2OGaming%2O Compacts.pdf-, Standing Rock Sioux Tribe and State of South Dakota, Gaming Compact of 1992, August 6, 1992 [hereinafter Original Standing Rock Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Standing%20Rock%2OSioux%20-%2OGaming%2O Compacts.pdf-, Yankton Sioux Tribe and State of South Dakota, Gaming Compact of 1990, August 10, 1990 [hereinafter Original Yankton Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Yankton%20Sioux%20-%2OGaming%2O Compacts.pdf.

(136.) Crow Creek Sioux Tribe and State of South Dakota, Gaming Compact of 1991, October 4, 1991, amended September 25, 2001 [hereinafter Amended Crow Creek Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Crow%2OCreek%20Sioux%20%20 Gaming%2OCompacts.pdf, Lower Brule Sioux Tribe and State of South Dakota, Gaming Compact of 1991, July 9, 1991, amended July 24, 2001 [hereinafter Amended Lower Brule Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Lower%2OBrule%20 Sioux%20%20Gaming%2OCompacts.pdf, Oglala Sioux Tribe and State of South Dakota, Gaming Compact of 1993, August 25, 1993, amended July 24, 2001, [hereinafter Amended Oglala Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Ogiala%20Sioux%20% 20Gaming%2OCompacts.pdf, Rosebud Sioux Tribe and State of South Dakota, Gaming Compact of 1993, February 4, 1993, amended July 24, 2001 [hereinafter Rosebud Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Rosebud%20Sioux%20-%2OGaming %2OCompacts.pdf-, Sisseton-Wahpeton Sioux Tribe and State of South Dakota, Gaming Compact of 1990, December 31, 1990, amended July 24, 2001 [hereinafter Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Sisseton-Wahpeton%2OSioux%20 %20Gaming%20Compacts.pdf, Standing Rock Sioux Tribe and State of South Dakota, Gaming Compact of 1992, August 6, 1992, amended August 3, 2001 [hereinafter Amended Standing Rock Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Standing%20Rock%2OSioux%20%20Gaming%2O Compacts.pdf, Yankton Sioux Tribe and State of South Dakota, Gaming Compact of 1990, August 10, 1990, amended July 24, 2001 [hereinafter Amended Yankton Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Yankton%20Sioux%20-%2OGaming%2OCompacts.pdf. It should be noted that the Cheyenne River Sioux Tribe negotiated a gaming compact with the State in 1993; however, no gaming actually took place. Original Cheyenne River Sioux Tribe Gaming Compact, supra note 135.

(137.) See Flandreau Santee Sioux Tribe v. South Dakota., Civil No. 07-CV-4040 (D.S.D. March 19, 2007); Flandreau Santee Sioux Tribe and State of South Dakota, Gaming Compact of 1990, June 29, 1990, amended July 24, 2001 [hereinafter Amended Flandreau Santee Sioux Tribe Gaming Compact], available at http://www.state.sd.us/oia/files/Flandreau%20Sioux%20-%2O Gaming%2OCompacts.pdf. The State has consistently alleged that by conducting its gaming operations without a valid gaming compact, the FSST is in direct violation of the IGRA. Defendants' Memorandum of Points & Authorities in Support of Motion for Judgment on the Pleadings at 11, Flandreau Santee Sioux Tribe v. South Dakota, Civil No. 07-CV-4040 (D.S.D. Mar. 19, 2007) [hereinafter Defendant's Memorandum in Support of Motion for Judgment on the Pleadings].

(138.) Original Crow Creek Sioux Tribe Gaming Compact, supra note 135, [section] 8.7; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 3; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136, [section] 8.5; Original Oglala Sioux Tribe Gaming Compact, supra note 135, [section] 4.4; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136, [section] 3; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136, [section] 8.5; Original Standing Rock Sioux Tribe Gaming Compact, supra note 135, [section] 8.5; Amended Yankton Sioux Tribe Gaming Compact, supra note 136, [section] 8.5.

(139.) Original Crow Creek Sioux Tribe Gaming Compact, supra note 135, [section] 3; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 4; Amended Lower Brule Sioux Gaming Compact, supra note 136, [section]3; Original Oglala Sioux Tribe Gaming Compact, supra note 135, [section] 3; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136, [section] 4; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136, [section] 3; Original Standing Rock Sioux Tribe Gaming Compact, supra note 135, [section] 3; Amended Yankton Sioux Tribe Gaming Compact, supra note 136, [section] 3. The types of gaming offered can include slot machines, blackjack, and pari-mutuel wagering. Id.

(140.) Amended Crow Creek Sioux Tribe Gaming Compact, supra note 136, [section] 2; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 9.5; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136, [section] 8.5; Amended Oglala Sioux Tribe Gaming Compact, supra note 136, [section] 1; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136, [section] 9.5; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136, [section] 8.5; Amended Standing Rock Sioux Tribe Gaming Compact, supra note 136, at 2; Amended Yankton Sioux Tribe Gaming Compact, supra note 136, [section] 8.5. During the 2000 negotiations, a substantial modification was made to the compact. Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 136, [section] 9.5. "Gaming devices" no longer included both slot machines and table games. Id. Rather, the 250 limit was placed only on slot machines while an unlimited number of blackjack tables were permitted. Id.

(141.) The Crow Creek Sioux Tribe, the Lower Brule Sioux Tribe, and the Oglala Sioux Tribe have gaming compacts that are renewable every two years. Amended Crow Creek Sioux Tribe Gaming Compact, supra note 136, [section] 7; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136, [section] 10; Original Oglala Sioux Tribe Gaming Compact, supra note 135, [section] 10. The Flandreau Santee Sioux Tribe and Rosebud Sioux Tribe have gaming compacts which are renewable every three years. Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 11; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136, [section] 11. The Sisseton-Wahpeton Sioux Tribe, the Standing Rock Sioux Tribe, and the Yankton Sioux Tribe have gaming compacts which are renewable every four years. Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136, [section] 10; Amended Standing Rock Sioux Tribe Gaming Compact, supra note 136, [section] 7; Amended Yankton Sioux Tribe Gaming Compact, supra note 136, [section] 12.

(142.) Original Crow Creek Sioux Tribe Gaming Compact, supra note 135, [section] 8.15; Amended Flandreau Santee Sioux Tribe Gaining Compact, supra note 137, [section] 9.8; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136, [section] 8.8; Amended Oglala Sioux Tribe Gaming Compact Amendment, supra note 136, [section] 3; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136, [section] 9.8; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136, [section] 8.9; Amended Standing Rock Sioux Tribe Gaming Compact, supra note 136, [section] 6; Amended Yankton Sioux Tribe Gaming Compact, supra note 136, [section] 8.9.

(143.) See 2008 S.D. DEP'T REVENUE &REGULATION ANN. REP. 36-37.

(144.) Id. at 36. The state receives video lottery revenue as a percentage share of net machine income. Id. at 37. In other words, the state calculates the percent share of net machine income as cash-in minus cash-out. Id. Since 1989, the state's share of net video lottery income has increased to fifty percent. Id. S.D.C.L. [section] 42-7A-63 states:
   The commission shall maximize revenues to the state from video
   lottery. The state's percentage of net machine income shall be
   fifty percent. The state's percentage of net machine income shall
   be directly deposited to the property tax reduction fund, except
   for one-half of one percent of net machine income authorized for
   deposit into the video lottery operating fund. The effective date
   of this section is July 1, 1996.


Id. Of the South Dakota's 50% share, 49.5% is placed in the Property Tax Reduction Fund and 0.5% is used by the lottery for administrative costs. 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 37. The other fifty y percent of net machine income is retained by the licensed operator. Id

(145.) 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 36. In 2008, there were 620 licensed instant ticket retailers in South Dakota. Id. Retailers receive a five percent commission for selling tickets. Id. Retailers receive an extra one percent commission for cashing winning tickets up to $100 and an additional one percent for selling tickets with more than $100 prizes. Id.

(146.) Id. at 37. Retailers totaled over $2.3 million in revenue from scratch tickets and lotto games. Id. at 36. Revenue from instant (scratch) tickets totaled over $5.1 million to the General Fund and lotto ticket revenue to the state distributed $1.4 million to the General Fund and over $4.8 million to the Capital Construction Fund. Id. at 37.

(147.) See id. at 36-37.

(148.) Video Lottery Establishments, Terminals, Net Machine Income, & Revenue Distribution, South Dakota Lottery, http://www.sdiottery.org/pdf%20docs/NMI%20annual.pdf (last visited Jan, 19, 2009).

(149.) Video Lottery in South Dakota, South Dakota Lottery, http://www.sdlottery.org/VideoLotteryInfo.asp (last visited Jan. 19, 2009).

(150.) 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 36-37. In 2008, a total of 8,968 video lottery terminals were in 1,478 establishments across the state. Id. at 37. Revenue from net machine income is distributed to the Property Tax Reduction Fund and a share of the machine manufacturer license fees is distributed to the General Fund. Id. The lottery provides the Department of Human Services funding for gambling treatment services. Id. Revenue distributed in 2008 includes $111,207,299 to the Property Tax Reduction Fund, $545,000 to the General Fund, and $214,000 to the Department of Human Services. Id.

(151.) 2008 S.D. GAMING COMM'N ANN. REP. 9.

(152.) Id. at 6.

(153.) Id. at 9. See 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 38. In 2003, full time equivalent employees were 1,499. WILL CUMMINGS, CUMMINGS ASSOCIATES, ANALYSIS OF THE CURRENT MARKETS FOR GAMING IN SOUTH DAKOTA WITH PROJECTIONS FOR THE LIKELY IMPACTS OF NEW OR ENLARGED FACILITIES Exhibit 1 (2004).

(154.) See 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 38. For a discussion of the distribution of video lottery revenues, see supra note 144.

(155.) See S.D.C.L. [section] 42-7A-63 (2004); id. [section] 42-7B-28 (2004). For the text of S.D.C.L. [section] 42-7A- 63, see supra note 144.

(156.) S.D.C.L. [section] 42-713-28.

(157.) 2008 S.D. GAMING COMM'N ANN. REP. 2. Money generated for the State of South Dakota is distributed to the General Fund, South Dakota Tourism, State Historical Preservation, and the Department of Human Services. Id. at 9; 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 38. From Deadwood's $100 million adjusted gross revenue for fiscal year 2008, over $2.4 million was deposited into the State's General Fund and $3.1 million was received by the Tourism Fund. 2008 S.D. GAMING COMM'N ANN. REP. 9. The Department of Human Services received $30,000 and State Historical Preservation obtained $100,000. Id. Other municipalities in Lawrence County and local school districts each received $352,950.54 and Lawrence County received $793,431.35. Id. The City of Deadwood was the largest beneficiary, receiving over $7.2 million from Deadwood gaming. Id. See 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP.38.

(158.) See CUMMINGS, supra note 153, at 2.

(159.) Id. at 1.

(160.) ALAN MEISTER, CASINO CITY'S INDIAN GAMING INDUSTRY REPORT, 2008-2009 ED. 13 (2008). Dr. Meister is an economist with extensive experience analyzing the gaming industry, including Indian gaming. Id. at 123. Gaming revenue as reported by Meister dropped three percent between 2006 and 2007, from $100.1 million to $97.1 million, respectively. Id. at 13. Dr. Meister defines gaming revenue as: "all revenue earned from Class 11 and Class III gaming. It is measured on a calendar-year basis as amounts wagered minus prizes and payouts. It is sometimes refereed to as net win or gross gaming revenue." Id. at 9.

(161.) Id. at 38.

(162.) See id. See also 2008 S.D. GAMING COMM'N ANN. REP. 9

(163.) CUMMINGS, supra note 153, at 1.

(164.) Id. at 2. Total gaming "win" is analogous to total consumer spending on gaming activities. Id at ii. Total full-time equivalent employees in 2003 totaled 1,363. Id. at Exhibit 1. The nine tribal casinos in South Dakota are Dakota Sioux Casino, Dakota Connection Casino, Fort Randall Casino, Royal River Casino, Lode Star Casino, Golden Buffalo Casino, Rosebud Casino, Prairie Wind Casino, and Grand River Casino. Frequently Asked Questions, South Dakota Gaming Commission, http://www.state.sd.us/drr2/reg/gaming/frequent/htm (last visited Jan. 19, 2009). See G. WILLIAM RICE, TRIBAL GOVERNMENTAL GAMING LAW: CASES AND MATERIALS, xix (2006).

(165.) Slots Hurting but Not in South Dakota (KELO Land Television broadcast on July 23, 2008) http://www.keloland.com/NewsDetail6l62.cfm?Id=25,72149 (last visited on Jan. 19, 2009) [hereinafter Slots Hurting but Not in South Dakota]. Royal River Casino, operated by the FSST, claims gaming was up twenty-five percent in 2008, showing a one million dollar increase. Id. Most recent nationwide projections for 2007 conclude Indian gaming net revenues continue to grow. NIGC Announces 2007 Indian Gaming Revenues, National Indian Gaming Commission, http://www.nigc.gov/ReadingRoom/PressReleases/PressReleasesMain/ PR93062008/tabid/84I /Default.a spx (last visited Jan. 19, 2009). Chairman of the National Indian Gaming Commission, Philip N. Hogan, stated, "[f he Indian gaming industry has experienced tremendous growth since the inception of the Indian Gaming Regulatory Act (IGRA) twenty years ago in 1988 when the Indian gaming industry saw revenues of $200 million, to now over $26 billion in 2007." Id. The National Indian Gaming Commission Region IV, which encompasses Iowa, Michigan, Minnesota, Montana, North Dakota, Nebraska, South Dakota, Wisconsin, and Wyoming, reported gaming revenues totaling over $4.2 billion in 2007. Id. In 2006, Region IV generated over $4 billion in gaming revenue resulting in a one year gaming revenue increase of 3.6%. KATi-IRYN R.L. RAND & STEVEN ANDREW LIGHT, INDIAN GAMING LAW CASES AND MATERIALS 4 (2008) [hereinafter RAND & LIGHT, CASES AND MATERIALS].

(166.) See CUMMINGS, supra note 153, at 3.

(167.) See id.

(168.) See id.

(169.) Id.

(170.) Id. at Exhibit 2. The three middle casinos had total gaming revenue of over $23 million. Id. Total full time equivalent (FTE) employees for the three largest casinos totaled 672, the FTE's for the three middle casinos was 442, and the FTE's for the three smallest casinos was 249. Id.

(171.) See id. at 12; RAND &LIGHT, CASES AND MATERIALS, supra note 165, at 3.

(172.) See CUMMINGS, supra note 153, at 6.

(173.) Id.

(174.) Id.

(175.) S.D. CONST. art. II.

(176.) Id.

(177.) See id. The South Dakota Constitution and state law do detail general duties of both the Governor and the Legislature. S.D. CONST. art. IV, [section] 3 (amended 1972) (detailing the powers and duties of the Governor); S.D. CONST. art. III, [section] 1 (amended 1988) (outlining the powers of the Legislature); S.D.C.L. [section] 1-7-1 (2004) (delineating the powers and duties of the Governor).

(178.) S.D.C.L. [section] 1-4-25 (1989).

(179.) Original Flandreau Santee Sioux Tribe Gaming Compact, supra note 135.

(180.) See S.D.C.L. [section] 1-4-25 (2004).

(181.) See S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005); S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006). During the 2009 Legislative Session, a bill was introduced which stated, "[a]ny agreement or compact between the State of South Dakota and an Indian tribe that is made pursuant to chapter 1-4, 10-12A, or 42-7A is binding and effective only after the agreement or compact is approved by the Legislature." H. B. 1283, 2009 Leg., 84th Sess. (S. D. 2009), available at http://legis.state.sd.us/sessions/2009/Bill.aspx?Bill=1283. State Affairs unanimously deferred House Bill 1283 to the forty-first legislative day. Id.

(182.) S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005); S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006). During the 2005 Legislative Session, Senator David Knudson introduced the following proposal:
   Before entering into a compact with an Indian tribe on any class
   III gaming under the Federal Indian Gaming Regulatory Act, the
   Governor or the Governor's designee shall hold one or more public
   hearings in the affected area to allow any interested persons to
   state their views. However, such a compact shall be binding and
   effective only after it is approved by the Legislature.


S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005) (emphasis added). During the 2006 Legislative Session, Senator David Knudson introduced the following proposal:
   Before entering into a compact with an Indian tribe on any class
   III gaming under the Federal Indian Regulatory Gaming Act, the
   Governor or the Governor's designee shall hold one or more public
   hearings in the affected area to allow any interested persons to
   state their views. If a compact would result in an increase in the
   amount of gaming activities allowed or a change in the location of
   the gaming activities, the increase or change shall be binding and
   effective only after it is approved by the Legislature.


S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006) (emphasis added).

(183.) An Act to Revise the Conditions Under Which the State May Enter into Gaming Compacts with Indian Tribes: Hearing on S.B. 210 Before the S. Comm. on State Affairs, 2005 Leg., 80th Sess. (S.D. 2005) available at http://legis.state.sd.us/sessions/2005/210.htm (statement of Senator David Knudson, primary bill sponsor); An Act to Revise the Conditions Under Which the State May Enter into Gaming Compacts with Indian Tribes: Hearing on S.B. 167 Before the S. Comm. on State Affairs, 2006 Leg., 81st Sess. (S.D. 2006) available at http://legis.state.sd.us/sessions/ 2006/167.htm (statement of Senator David Knudson, primary bill sponsor).

(184.) S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005); S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006). The 2005 bill passed in the Senate by a vote of 23 to 10. S.B. 210, 80th Leg. (S.D. 2005) available at http://legis.state.sd.us/sessions/2005/210.htm. The 2006 bill passed in the Senate by a vote of 22 to 12. S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006) available at http://legis.state. sd.us/sessions/2006/167.htm.

(185.) S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005); S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006). The 2005 bill failed in the House of Representatives by a vote of 23 to 47. S.B. 210, 2005 Leg., 80th Sess. The 2006 bill was deferred to the thirty-sixth day by a vote of 13 to 0 in the House State Affairs Committee. S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006).

(186.) See Fla. House of Representatives v. Crist, 990 So. 2d 1035 (Fla. 2008); Dewberry v. Kulongoski, 406 F. Supp. 2d 1136 (D. Or. 2005); Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 N.Y.2d 801 (N.Y. 2003); State ex rel. Clark v. Johnson, 904 P.2d 11 (N.M. 1995); State ex rel. Stephan v. Finney, 836 P.2d 1169 (Kan. 1992).

(187.) See Crist, 990 So. 2d 1035; Dewberry, 406 F. Supp. 2d 1136; Pataki, 100 N.Y.2d 801; Johnson, 904 P.2d 11; Finney, 836 P.2d 1169.

(188.) 406 F. Supp. 2d 1136.

(189.) Id. at 1157.

(190.) Id. at 1139.

(191.) Id. at 1138.

(192.) Id. at 1154.

(193.) Id. (quoting OR. CONST. art. V, [section] 13).

(194.) Id. at 1155.

(195.) Id. at 1154.

(196.) Id. at 1156.

(197.) Id.

(198.) Id.

(199.) Id.

(200.) See Fla. House of Representatives v. Crist, 990 So. 2d 1035 (Fla. 2008); Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 N.Y.2d 801 (N.Y. 2003); State ex rel. Clark v. Johnson, 904 P.2d 11 (N.M. 1995); State ex rel. Stephan v. Finney, 836 P.2d 1169 (Kan. 1992).

(201.) 836 P.2d 1169 (Kan. 1992).

(202.) Id. at 1170. The Kickapoo Indian Reservation is located in Kansas. Id.

(203.) Id. at 1178.

(204.) Id.

(205.) Id. (citing KAN. CONST. art. I, [section] 3).

(206.) Id.

(207.) Id.

(208.) Id. at 1185. The compact authorized would have created a State Gaming Agency where one did not previously exist, required the Kansas Bureau of Investigation to complete a background check and provide a written report on each prospective employee creating a new function to the agency, and mandated that Tribal Law Enforcement Agency members attend training despite the Tribe not being a criminal justice agency. Id.

(209.) Id.

(210.) 904 P.2d 11 (N.M. 1995).

(211.) Id. at 15.

(212.) Id.

(213.) Id. at 23. See Pueblo of Santa Ana v. Kelly, 104 F.3d 1546 (10th Cir. 1997).

(214.) Johnson, 904 P.2d at 24.

(215.) Id.

(216.) Id. at 23.

(217.) 100 N.Y.2d 801 (N.Y. 2003).

(218.) Id. at 808.

(219.) Id. at 809. The amendment was approved for a one-year term by the Secretary of the Interior.

Id.

(220.) Id. at 810. The original compact was signed in 1993. Id. at 808. The compact allowed St. Regis to conduct gaming including baccarat, blackjack, craps, and roulette. Id.

(221.) Id. at 810.

(222.) Id.

(223.) Id. at 822 (citing Bourquin v. Cuomo, 85 N.Y.2d 781, 784 (N.Y. 1995); In re N.Y. State Health Facilities Ass'n v. Axelrod, 77 N.Y.2d 340, 349 (N.Y. 1991)).

(224.) Pataki, 100 N.Y.2d at 822.

(225.) Id. at 823. The compact required new regulations for gaming oversight. Id.

(226.) Id. at 824.

(227.) 990 So. 2d 1035 (Fla. 2008).

(228.) Id. at 1038. The negotiated compact significantly expanded gaming on Seminole lands to include games not authorized by state law. Id.

(229.) Id.

(230.) Id.

(231.) Id. at 1046.

(232.) Id. at 1050.

(233.) See Crist, 990 So. 2d 1035; Dewberry v. Kulongoski, 406 F. Supp. 2d 1136 (D. Or. 2005); Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 N.Y.2d 801 (N.Y. 2003); State ex rel. Clark v. Johnson, 904 P.2d 11 (N.M. 1995); State ex rel. Stephan v. Finney, 836 P.2d 1169 (Kan. 1992).

(234.) See Crist, 990 So. 2d 1035 (holding that governor's execution of a gaming compact authorizing gaming was legislative in nature); Dewberry, 406 F. Supp. 2d 1136 (opining that governor has the authority to negotiate and execute); Pataki, 100 N.Y.2d 801 (concluding that governor lacked the power to unilaterally negotiate and execute a gaming compact); Clark, 904 P.2d 11 (holding that governor may not unilaterally enter into a compact); Finney, 836 P.2d 1169 (concluding that governor did not have authority to execute a gaming compact).

(235.) 25 U.S.C. [section] 2710(d)(3)(A) (2006) (emphasis added). For the text of 25 U.S.C. [section] 2710(d)(3)(A), see supra note 59.

(236.) See generally In re Indian Gaming Related Cases v. California, 331 F.3d 1094 (9th Cit. 2003) (holding that state did not act in bad faith by requiring the tribe to adopt special distribution fund provisions as a precondition to entering a compact); Wis. Winnebago Nation v. Thompson, 22 F.3d 719 (7th Cir. 1994) (concluding that state did not fail to negotiate in good faith by refusing one month after a compact was signed to enter into negotiations regarding an additional casino site); Rumsey Indian Rancheria of Wintun Indians v. Wilson, 64 F.3d 1250 (9th Cit. 1994) (holding that state does not have to negotiate over class III gaming activity when a state does not permit the gaming activity sought); Mashantucket Pequot Tribe v. Connecticut, 913 F.2d 1024 (2d Cit. 1990) (opining that state failed to negotiate in good faith by not entering into negotiations after a tribal request for class III gaming).

(237.) See 25 U.S.C. [section] 2710(d)(3)(A).

(238.) Id. [section] 2710(d)(7)(B)(iii)(I)-(II) (emphasis added).

(239.) 3 F.3d 273 (8th Cir. 1993).

(240.) Id. at 275.

(241.) Id. at 276-77.

(242.) Id. at 277. For instance:
   [T]he Cheyenne River Sioux Tribe reservation is about the size of
   Connecticut and is located in a remote western part of the state,
   far from population centers, which are located in the southeastern
   corner of the state (near the Iowa and Nebraska borders). The
   Cheyenne River Sioux Tribe has at least 10 times the members of the
   Flandreau Santee Sioux Tribe and, unlike the Flandreau Santee Sioux
   Tribe, has a mature tribal government, including tribal police and
   tribal courts.


Id.

(243.) Id.

(244.) Cheyenne River Sioux Tribe v. South Dakota, 830 F. Supp. 523, 527 (D.S.D. 1993).

(245.) Id. at 528.

(246.) Cheyenne River Sioux Tribe v. South Dakota, 3 F.3d 273, 279 (8th Cir. 1993).

(247.) Id.

(248.) Id. After the Eighth Circuit's ruling, a compact was agreed upon in 1993. Original Cheyenne River Sioux Tribe Gaming Compact, supra note 135. This compact was never implemented by the Tribe. See generally id.

(249.) See Flandreau Santee Sioux Tribe v. South Dakota, Civil No. 07-CV-4040 (D.S.D. Mar. 19, 2007).

(250.) Id.

(251.) See Defendant's Memorandum in Support of Motion for Judgment on the Pleadings, supra note 137. The Tribe requested negotiations in May 2005 to execute an amended class III compact. Plaintiff's Brief in Opposition to Defendants' Motion for Judgment on the Pleadings & Opposition to the Defendants' Request for Judicial Notice at 2, Flandreau Santee Sioux Tribe, Civil No. 07-CV-4040. However, the parties were unable to negotiate a compact. Id.

(252.) Id. at 10. Six negotiating sessions between the State and the FSST took place on (1) September 30, 2005, (2) June 20, 2006, (3) July 26, 2006, (4) August 23, 2006, (5) September 8, 2006, and (6) January 11, 2007. Id.

(253.) Response to Defendants' Motion for Protective Order at 3, Flandreau Santee Sioux Tribe, 2007 WL 4902908 [hereinafter Response to Defendants' Motion for Protective Order].

(254.) See Defendant's Memorandum in Support of Motion for Judgment on the Pleadings, supra note 137, at 10. The Memorandum stated, "[the FSST] demanded an outright elimination of the 250 slot machine limit. In fact, [the FSST] demanded that it be allowed to operate an unlimited number of slot machines." Id. The FSST asserted that:
   The State refused to negotiate concerning any increase in the
   number of slot machines .... As a basis for its refusal to
   negotiate, the State asserted that South Dakota public policy only
   authorizes limited gaming and, as such, allowing the Tribe to
   operate more than 250 slot machines would violate that policy.


Response to Defendants' Motion for Protective Order, supra note 253, at 3.

(255.) Response to Defendants' Motion for Protective Order, supra note 253, at 3. The Response to Defendants' Motion for Protective Order states, "[f he State has asserted that it will not negotiate a Compact for longer than a six (6) year term because the Governor does not wish to bind future administrations." Id.

(256.) See Defendant's Memorandum in Support of Motion for Judgment on the Pleadings, supra note 137, at 11. See S.D. CONST. art. 111, [section] 25; S.D.C.L. [section] 42-7B-1 (2004).

(257.) See Defendant's Memorandum in Support of Motion for Judgment on the Pleadings, supra note 137, at 4.

(258.) See generally Amended Crow Creek Sioux Tribe Gaming Compact, supra note 136; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136; Amended Oglala Sioux Tribe Gaming Compact, supra note 136; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136; Amended Standing Rock Sioux Tribe Gaming Compact, supra note 136, Amended Yankton Sioux Tribe Gaming Compact, supra note 136.

(259.) S.D. CONST. art. II.

(260.) See id.

(261.) See Fla. House of Representatives v. Crist, 990 So. 2d 1035 (Fla. 2008) (favoring legislative action); Dewberry v. Kulongoski, 406 F. Supp. 2d 1136 (D. Or. 2005) (favoring governor's unilateral role); Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 N.Y.2d 801 (N.Y. 2003) (favoring legislative action); State ex rel. Clark v. Johnson, 904 P.2d 11 (N.M. 1995) (favoring legislative action); State ex rel. Stephan v. Finney, 836 P.2d 1169 (Kan. 1992) (favoring legislative action).

(262.) See generally S.D. CONST. art. 111, [section] 6 (amended 1992); Crist, 990 So. 2d 1035; Pataki, 100 N.Y.2d 801; Johnson, 904 P.2d 11; Finney, 836 P.2d 1169. In 2008, an amendment to the South Dakota Constitution was proposed "to provide for a maximum of forty legislative days each year." State of South Dakota, Secretary of State, South Dakota 2008 Ballot Questions, Constitutional Amendment 1, 4, http://www.sdsos.gov/electionsvoterregistration/elecrovotpdf/ 2008SouthDakotaBallotQuestionPamplet.p df (last visited Jan. 20, 2009) [hereinafter South Dakota 2008 Ballot Questions]. Constitutional Amendment I passed by 52.41%. 2008 South Dakota Official General Election Results: Statewide Ballot Questions, November 4, 2008, http://www.sdsos.gov/electionsvoteregistration/ pastelections-electioninfoO8_generalbq.shtm (last visited Jan. 20, 2009).

(263.) See South Dakota 2008 Ballot Questions, supra note 262; Finney, 836 P.2d 1169; 25 U.S.C. [section] 2710(d)(7)(A)-(B) (2006).

(264.) See 25 U.S.C. [section] 2710(d)(7)(A)-(B); Finney, 836 P.2d 1169.

(265.) See Finney, 836 P.2d 1169.

(266.) See id. at 1185.

(267.) See generally id.

(268.) S.D.C.L,. [section] 1-7-1 (2004).

(269.) Id. [section] 1-7-1(4).

(270.) See id.

(271.) S.D.C.L. [section] 1-7-1(8).

(272.) See 25 U.S.C. [section][section] 2701-2721 (2006); 18 U.S.C. [section][section] 1166-1168 (2006); S.D.C.L. [section] 1-7-1.

(273.) See S.D.C.L. [section] 1-7-1(8).

(274.) See generally 25 U.S.C. [section] 2710(d)(3)(A). For the text of the Act, see supra note 59.

(275.) Id.

(276.) Id.

(277.) Fla. House of Representatives v. Crist, 990 So. 2d 1035, 1046-47 (Fla. 2008); State ex rel. Stephan v. Finney, 836 P.2d 1169, 1179 (Kan. 1992).

(278.) See S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005); S.B. 167, 2006 Leg., 81st Sess. (S.D. 2006). For the text of both bills, see supra note 182.

(279.) S.B. 210, 2005 Leg., 80th Sess. (S.D. 2005); S.B. 167, 2006 Leg., 81 st Sess. (S.D. 2006).

(280.) See Dewberry v. Kulongoski, 406 F. Supp. 2d 1136, 1156 (D. Or. 2005).

(281.) See An Act to Revise the Conditions Under Which the State May Enter into Gaming Compacts with Indian Tribes: Hearing on S.B. 210 Before the S. Comm. on State Affairs, 2005 Leg., 80th Sess. (S.D. 2005).

(282.) See generally id.

(283.) See Fla. House of Representatives v. Crist, 990 So. 2d 1035 (Fla. 2008); Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 N.Y.2d 801 (N.Y. 2003); State ex rel. Clark v. Johnson, 904 P.2d 11 (N.M. 1995); State ex rel. Stephan v. Finney, 836 P.2d 1169 (Kan. 1992).

(284.) S.D. CONST. art. III, [section] 1 (amended 1988).

(285.) S.D. CONST. art. IV, [section] 3 (amended 1972) (emphasis added).

(286.) See Crist, 990 So. 2d 1035; Dewberry v. Kulongoski, 406 F. Supp. 2d 1136, 1156 (D. Or. 2005); Pataki, 100 N.Y.2d 801; Johnson, 904 P.2d 11; Finney, 836 P.2d 1169.

(287.) See Crist, 990 So. 2d 1035 (holding a governor's execution of a gaming compact authorizing gaming was legislative in nature); Dewberry, 406 F. Supp. 2d 1136 (concluding that a governor has the authority to negotiate and execute); Pataki, 100 N.Y.2d 801 (opining that a governor lacked the power to unilaterally negotiate and execute a gaming compact); Johnson, 904 P.2d l I (holding a governor may not unilaterally enter into a compact); Finney, 836 P.2d 1169 (concluding that a governor did not have authority to execute a gaming compact).

(288.) See generally S.D. CONST. art. IV, [section] 3 (amended 1972); S.D.C.L. [section] 1-7-1 (2004).

(289.) S.D. CONST. art. III, [section] 1 (amended 1988). See Finney, 836 P.2d at 1178.

(290.) See S.D. CONST. art. 111, [section] I (amended 1988); Finney, 836 P.2d at 1178.

(291.) S.D.C.L. [section] 1-4-25 (1989). The statute states: "Before entering into a compact with an Indian tribe on any class III gaming under the Federal Indian Gaming Regulatory Act, the Governor or his designee shall hold one or more public hearings in the affected area to allow any interested persons to state their views." Id.

(292.) See generally id.

(293.) Finney, 836 P.2d at 1178.

(294.) Id.

(295.) See generally id. at 1179.

(296.) See generally id.

(297.) S.D. CONST. art. 111, [section] 25 (amended 1994). For the full text of the S.D. CONST. art. 111, [section] 25, see supra note 11. See S.D.C.L. [section] 42-7B-1 (2004). For the full text of the statute, see supra note 116.

(298.) See S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(299.) Response to Defendants' Motion for Protective Order, supra note 253, at 1-3.

(300.) See generally S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1; 25 U.S.C. [section] 271 0(d)(3)(A) (2006).

(301.) See generally S.D. CONST. art. 111, [section] 25 (amended 1994); S.D. C.L. [section] 42-7B-1.

(302.) Defendants' Memorandum in Support of Motion for Judgment on the Pleadings, supra note 137, at 3. The State asserted:
   Since September 2005, [the FSST] and the State have conducted six
   formal negotiating sessions for an amended compact. During these
   negotiating sessions, [the FSST] has demanded (1) an "unlimited" or
   "market-based" number of slot machines; and (2) a longer compact
   term.


Id. (internal citations omitted).

(303.) See generally S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1; id. [section] 42- 7B-26; id. [section] 42-7B-16.

(304.) See S.D.C.L. [section] 42-7B-16; id. [section] 42-7B-26. For the text of S.D.C.L. [section] 42-7B-16, see supra note 126. For the text of S.D.C.L. [section] 42-7B-26, see supra note 127.

(305.) 2008 S.D. GAMING COMM'N ANN. REP. 6-9.

(306.) See S.D.C.L. [section] 42-7B-16; id. [section] 42-7B-26. A "gaming device" is defined as "a slot machine, a poker table, or a blackjack table[.]" Id. [section] 42-7B-4(6A).

(307.) S.D.C.L. [section] 42-7B-16. Deadwood license holders may have a total of thirty slot machines and blackjack tables, inclusive. Id.

(308.) Id. [section] 42-713-26.

(309.) See id. [section] 42-713-16; id. [section] 42-7B-26.

(310.) See Original Flandreau Santee Sioux Tribe Gaming Compact, supra note 135, [section] 8.5; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 9.5.

(311.) Original Flandreau Santee Sioux Tribe Gaming Compact, supra note 135, [section] 8.5; S.D.C.L. [section] 42-7B- 16; id. [section] 42-713-26. The compact stated, "[t]he Tribe shall be authorized to operate 180 gaming devices in the tribal gaming establishment. . . It is acknowledged between the parties hereto that the gaming device limitation of 180 constitutes two times the number of gaming devices permitted per individual in State law." Original Flandreau Santee Sioux Tribe Gaming Compact, supra note 135, [section] 8.5.

(312.) Original Flandreau Santee Sioux Tribe Gaming Compact, supra note 135, [section] 3.

(313.) See id. [section] 8.5; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 9.5.

(314.) Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 9.5. S.D.C.L. [section] 42-713-16; id. [section] 42-713-26.

(315.) Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 9.5. The compact states, "[f he number of slot machines permitted to be operated under this Compact shall be limited to 250. There shall be no limits placed on the number [of] blackjack tables that may be operated." Id.

(316.) Id.

(317.) See S.D. CONST. an. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(318.) S.D. CONST. art. III, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(319.) S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(320.) See generally S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(321.) See generally S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1. It should be noted that the FSST's gaming operations are also "geographically limited" because the FSST's gaming compact specifies the exact location where its gaming facility may operate. Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 3.

(322.) See generally S.D. CONST. art. III, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(323.) Defendants' Memo. in Support of Motion for Judgment on the Pleadings, supra note 137, at 12. The State has consistently alleged that by conducting its gaming operations without a valid gaming compact, FSST is in direct violation of the IGRA. Id. Tribes may partake in the video lottery phenomenon because it is considered class II gaming. S.D.C.L. [section] 42-7A-19.1 (2004). This statute states that the South Dakota Gaming Commission may provide for the sale of lottery products within the exterior of any reservation. Id. The tribe must pay the Commission on which the gaming takes place "an amount not to exceed fifty percent of the state's net proceeds from lottery products sold within the exterior boundaries of any reservation." Id. The Tribes therefore have the ability to partake in video lottery but have chosen not to. See id.

(324.) See S.D.C.L. [section] 42-7B-1; id. [section] 42-7B-14.

(325.) Id. [section] 42-713-4.

(326.) Id. [section] 42-7B-14 (1989).

(327.) Id. [section] 42-7B-14 (2004); Initiated Measure 1, South Dakota Secretary of State 2000 Ballot Question Texts and Attorney General Explanations, http://www.sdsos.gov/eiectionsvoteregistration/pastelections_election info00_ballottextsAGexplan.shtm (last visited Jan. 21, 2009). See Cheyenne River Sioux Tribe v. South Dakota, 3 F.3d 273, 279 (8th Cir. 1993).

(328.) 25 U.S.C. [section] 2710(d)(1)(B) (2006); Original Crow Creek Sioux Tribe Gaming Compact, supra note 135, [section] 8.15; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137, [section] 9.8; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136, [section] 8.8; Original Oglala Sioux Tribe Gaming Compact, supra note 135, [section] 8.8-8.9; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136, [section] 9.8; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136, [section] 8.9; Amended Standing Rock Sioux Tribe Gaming Compact, supra note 136, [section] 8.8; Amended Yankton Sioux Tribe Gaming Compact, supra note 136, [section] 8.9.

(329.) CUMMINGS, supra note 153, at Exhibit 1. The Cummings Associates report provides comparison between video lottery, Deadwood gaming, and Indian gaming. Id.

(330.) Id.

(331.) 2008 S.D. GAMING COMM'N ANN. REP. 6.

(332.) Id. at 9.

(333.) CUMMINGS, supra note 153, at Exhibit 1.

(334.) Id. at i.

(335.) Slots Hurting but Not in South Dakota, supra note 165. Class III gaming for the Flandreau Santee Sioux Tribe was estimated in July of 2008 to have increased twenty-five percent or one million dollars from the same time-period in the previous year. Id.

(336.) CUMMINGS, supra note 153, at Exhibit 1.

(337.) Id.

(338.) MEISTER, supra note 160, at 13.

(339.) Id. See supra note 160 for a definition of "gaming revenue" as applied by Dr. Meister.

(340.) Slots Hurting but Not in South Dakota, supra note 165.

(341.) MEISTER, supra note 160, at 13; 2008 S.D. GAMING COMM'N ANN. REP. 9.

(342.) See S.D. CONST. art. 111, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1 (2004).

(343.) See generally S.D. CONST. art. III, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(344.) See generally S.D. CONST. art. III, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1.

(345.) S.D. CONST. art. III, [section] 25 (amended 1994); S.D.C.L. [section] 42-7B-1; 25 U.S.C. [section][section] 2701-21 (2006); 18 U.S.C. [section][section] 1166-1168 (2006).

(346.) See Cheyenne River Sioux Tribe v. South Dakota, 3 F.3d 273, 276-77 (8th Cir. 1993). See generally Original Cheyenne River Sioux Tribe Gaming Compact, supra note 135; Original Cheyenne River Gaming Compact, supra note 135; Original Crow Creek Sioux Tribe Gaming Compact, supra note 135; Original Flandreau Santee Sioux Tribe Gaming Compact, supra note 135; Original Lower Brule Sioux Tribe Gaming Compact, supra note 135; Original Oglala Sioux Tribe Gaming Compact, supra note 135; Original Rosebud Sioux Tribe Gaming Compact, supra note 135; Original Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 135; Original Standing Rock Sioux Tribe Gaming Compact, supra note 135; Original Yankton Sioux Tribe Gaming Compact, supra note 135.

(347.) See generally Original Cheyenne River Gaming Compact, supra note 135; Amended Crow Creek Sioux Tribe Gaming Compact, supra note 136; Amended Flandreau Santee Sioux Tribe Gaming Compact, supra note 137; Amended Lower Brule Sioux Tribe Gaming Compact, supra note 136; Amended Oglala Sioux Tribe Gaming Compact, supra note 136; Amended Rosebud Sioux Tribe Gaming Compact, supra note 136; Amended Sisseton-Wahpeton Sioux Tribe Gaming Compact, supra note 136; Amended Standing Rock Sioux Tribe Gaming Compact, supra note 136; Amended Yankton Sioux Tribe Gaming Compact, supra note 136.

(348.) Response to Defendants' Motion for Protective Order, supra note 253, at 3.

(349.) Id. at l.

(350.) 25 U.S.C. [section] 2710(d)(7)(B)(iii)(l)-(I1) (2006).

(351.) See generally id.

(352.) Id.

(353.) See CUMMINGS, supra note 153, at Exhibit 24.

(354.) See id. at 13. The Cummings Report stated:
   Adding casino capacity can therefore attract more customers from
   other states, and also keep more South Dakotans at home rather than
   traveling next door. This appears likely to be a major factor in
   Eastern South Dakota, where [the Cummings] analysis indicates that
   more money currently flows from the Sioux Falls area to casinos in
   other states (Minnesota and Iowa) than to those of South Dakota.
   Some of this outflow could be recaptured with more, larger, or
   better facilities in South Dakota.


Id.

(355.) See generally id.

(356.) Id. at Exhibit 24.

(357.) Id. Deadwood's total revenue percentage change would decrease by 0.2%. Id.

(358.) Id. South Dakota Video Lottery's total revenue percentage change would decrease 1.8%. Id.

(359.) Id.

(360.) Id.

(361.) Id. The Cummings Report noted that, "South Dakota's Indian gaming facilities differ dramatically in size. The top tier [of facilities] are roughly five times as large in terms of gaming revenues as those of the bottom tier, and employ nearly three times as many people." Id. at 3.

(362.) Id. at Exhibit 24.

(363.) S. REP. No. 100-446,(1988), as reprinted in 1988 U.S.C.C.A.N. 3071, 3083.

(364.) See 2008 S.D. DEP'T REVENUE & REGULATION ANN. REP. 38. Money generated for the State of South Dakota is distributed to the General Fund, South Dakota Tourism, State Historical Preservation, and the Department of Human Services. Id.

(365.) See CUMMINGS, supra note 153, at Exhibit 24.
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