Indian Gaming and the Eastern Band of Cherokee...

Indian Gaming and the Eastern Band ofCherokee Indians

CHRISTOPHER ARRIS OAKLEY

A t 10:00 A.M. on Ndvember 13, 1997, HarraK's Cherokee Casino opened on the56,000-acre Qualla reservation ofthe Eastern Band of Cherokee Indians in the

mountains of North Carolina. In the small town of Cherokee, traffic was backed up formiles as thousands of gamblers waited in line in the cold rain for a chance to try theirluck at one ofthe hundreds of new video gaming machines. By noon, casino officialswere politely asking patrons to leave and return at a later date or time. Opening daywas so busy, in fact, that technical problems forced managers temporarily to close thecasino to repair faulty machines.'

Prior to the 1990s, the Eastern Band of Cherokees could never have dreamed ofopening such a modern and popular gaming establishment. In the late 1980s, however,a landmark Supreme Court decision, a poorly worded and vague federal law, and thespreading popularity of gambling nationwide opened the door for the Chertikees, andother American Indians, to establish reservation gambling. Facing federal budget cutsfrom an increasingly hostile federal government, a declining tourist economy, andrampant poverty and unemployment on the reservation, the Cherokee principal chiefand tribal council decided to take their own gamble and enter the gaming industry.Overcoming both external and internal opposition to legalized gambling, the CherokeeTribal Council, with the help of federal law, forced the state government of NorthCarolina to sign an agreement that would allow the construction of a new casino.Harrah's Cherokee Casino represented the culmination of this bitter struggle that oftenpitted the Cherokee Tribal Council against the state government, the federalgovernment, local county governments, and members of their own community. Whilethe final verdict on the casino will not be handed down for years, the effects of the debatebetween pro- and anti-gambling factions can already be seen on the reservation, homeof about 7,000 of the 12,000 members ofthe Eastern Band of Cherokees.

Without the increasing popularity of legalized gambling in the United States, theCherokees could never have even conceived of initiating such a costly and controversialenterprise. Originating in the colonial era, state-sanctioned gambling has enjoyed acyclical past in American history. The current growth in state-sanctioned gaming startedin 1964 when New Hampshire reinstated the lottery. The popularity of lotteries spreadthroughout the 1970s and 1980s as cash-strapped states used gambling as a form ofindirect taxation. Whereas previously they attacked and prohibited gambling, state

1. News andOfaserver (Raleigh), November 14,1997; KnoxviíIeNeu's-Sencirte/, November H, 1997.

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134 CHRISTOPHER ARRIS OAKLEY

governments now actively encouraged participating in the Uittery, often spendingmillions of dollars advertising on television, radio, newspapers, and highway billboards.By in effect decriminalizing gaming, state lotteries have contributed to the fantasticgrowth in gambling in the United States over the past two decades. In 1990, 17 percentof American households had gambled in the previous twelve months. In 1993, though,more than 27 percent had gambled in the previous year, a significant increase. In thatsame year, more Americans visited a casino than attended a major league baseball game,supposedly America's favorite pastime. Currently, casinos are second only to movies asthe most popular fonn of entertainment in America. In 1994, Americans legally wageredmore than $3.4 billion. By 1997, every state except Hawaii and Utah had some formof legalized gambling. With the coinciding increase in illegal gambling, these estimatesate probably only fractions of the total gambling in the United States.'

Several factors have contributed to this explosion in gaming. Anti-tax sentimenthas forced state governments to seek alternate sources of revenue. Consequently, stategovernments use lotteries as a form of "voluntary taxation," despite the fact that lotteriesare regressive and inevitably hurt the poor more than the middle or upper classes. Bypromoting and advocating lotteries, state governments have reduced the negative imageoften associated with gambling. The cultural and political changes of the 1960s and1970s have also contributed to the popularity of gambling. The secularization ofAmerican society in general has decreased the influence of church leaders. Previouslyin American history, prominent ministers and priests have led the attack on both legaland illegal gaming. Furthermore, since the 1960s, Americans have increasingly shiedaway from the use of government as a moral arbiter.^

Gambling's increasing popularity has contributed to public approval of Indiangaming. In 1994, a Harris poll showed that 70 percent of Americans believed that NativeAmericans should be allowed to operate reservation casinos. Other polls have supportedthese findings. Without the growth in legalized gambling ovet the past two decades,American Indians could never have turned to reservation casinos as their "new whitebuffalo." In essence. Native American tribes have taken advantage of the growingpopularity of gambling nationwide by building casinos in states where they are currentlyoutlawed. Public acceptance was not enough, however. Because of their status asdomestic dependent nations under the United States government, Indian tribes alsohad to receive permission from the federal government to enter the gaming industry.''

In the 1960s and 1970s, the federal government shifted from a policy of terminationto self-determination for American Indians. Although initially a victory for Native

2. Chemkei; One Feather, November 2, 13, 1994; Martin Kou^han. "Easy Muney," Muiht-r Jones 22 (July1997): 32; James A. Davis and Lloyd E. Hudman, "The History of Indian Gaming Law and CasinoDevelopment in the Western United States," in Toumm aivi Gfljmng on American Indian Lands, ed. A!;m A.Lew ;md George A. Van Otten (Elmsford, N.Y.: Cognizant Communication Cor^i., 1998), 82; J. M, Fenster,"Nation of Gamblers," American Heritage 45 (September 1994): 36-48; Larry Hugick and Lydia Saad,"America's Gambling Boom," Public Perspective 5 (January 1994): 6-7; William A. Galston and DavidWasserman, "Gamhlmg Away Our Moral Capital," Public ¡merest 7 (March 1996): 58; "Gambling and theState," Ecanomisi, April 11, 1992.

3. Fenster, "N;«ion of Gamhlers," 36. 48; Galston and Wassetman. "Gambling Away Out Miiral Capital,"58; Hugick and Saad, "Ameticn's Gambling Boom," 6.4-Gherokee One Feather, October 12, 1994; Davis and Hudman, "History of Indian Gaming Law," 84-

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Americans, the Reagan administration used .self-determination as a rationale for cuttingfederal Indian programs in the 1980s. As he cut federal progratns for American Indians,Reagan argued that tribes should turn to the private sector to solve the rampant povertyand unemployment on reservations. Referring to the potential consequences of thisaction, one scholar has referred to Reagan's Indian policy as "Termination byAccountants" as the White House slashed Native American social programs.^

With limited options, some Native American tribes opened bingo parlors on theirreservation.s to offset these drastic budget cuts. Initially, the federal govemment actuallyencouraged this practice. In 1979, the Seminóle Indians opened a bingo parlor on theirsmall reservation in Florida. It quickly grew into a $4 million per year industry. Thoughlocal and state officials tried to close the parlor, the Supreme Court ruled that Floridalacked the authority to interfere on Indian reservations, technically under federaljurisdiction. In the early 1980s, the Cabazon Indians of California, a small tribe of onlytwenty-one eligible voters, took the next logical step by opening a small card room antheir reservation. After local authorities shut down the makeshift "casino," the CabazonIndians took the state of California to court. After a number of rulings and thesubsequent appeals, the case eventually ended up before the Supreme Court. In 1987,the Supreme Court handed down a landmark decision that shocked the country andled to the current explosion of reservation gaming. inCahazon Band ofMisaion ¡ndiamet al. V. California et ai., the Supreme Court ruled that although states could prohibitbingo and gambling within their boundaries, they could not regulate said activities onreservations because of Indians' special sovereign status under the national government.Therefore, if states allowed any form of bingo or gambling, Indian tribes could alsoestablish that activity on reservations free from state interference. Delivering theopinion of the Court, Justice Byron R. White argued that since "California permits asubstantial amount of gaming activity, including bingo, and actually promotes gamblingthrough its state lottery, we must conclude that California regulates rather than prohibitsgambling in general and hingt) in particular."*' The Cabazons were now free to operatetheir card room.^

The Supreme Court's decision in the Cahazon case astonished and horrified stategovernments and non-Indian casino owners. Fearing an explosion of unregulatedreservation gambling that would ct>mpete with non-Indian casinos and lotteries, stategovernments, gaming industry officials, and numerous congressmen demanded some

5. Beth Wilkins and Beth Ritter, "Will the House Win?" Greai Pkim Research 4 (Auf;usc 1994): 309-310;Alvin M. Josephy, The Indian Heritage of America (Boston: Houghton Mifflin, 1991), 367; William R.Eadington. ed., Indian Gamin)> and the liiw (Reno: Instirucc fur the Study oí Gamhling and CnmtnercialGaming, College of Business Administration, University of Nevada, 1998), 25íí'24'>; Kathryn Gabriel,Gambier Way: Indian Gaming in Myihology. History, and Archaeology in North America {Boulder, Colo.:Johnson Books, 1996), 185-186; C, P. Morris, "Termination hy Accountants," Policy Studies journal 16(.summer 1988): 731.

6. California et cd. v. Cabazon Band of Missiun hidianseial., 480 U.S. 202 (1987); Eadin^ron, Indian Gamingand the l^w, 238.

7. Eiidington, Indian Gaming and ihe Law, 238-244; Wayne Stein, "American Indians and Gambling," inAmerican hviian Stiidies: An Inierdisdpiiruiry Approach lo Gontemparary is.sue.s. ed. Dane Morrison (New York:Peter Lang, 1997), 150; Ambrose Lane, The Return of the While Btiffalo (Westport, Conn.: Bergon andGarvery, 1995), 60, 126-127, 178.

VC1I,UME LXXVIll • NUMBER 2 • APRIL 2001


kind of federal regulation. As a result nf this intense pressure from the states and fromthe powerful gamblitig lobby. Senators Daniel Inouye of Hawaii and Daniel Evans ofWashington quickly hammered out a compromise that both political parties could agreetu support. In October of 1988, about nineteen months after the Cabanon decision,Congress passed the Indian Gaming Regulatory Act (IGRA). Before leaving office,President Reagan signed the bill into law.'*

In the IGRA, Congress recognized and reiterated the Supreme Court's decision inCahazon. While underscoring the fact that Indian policy falls under the control of thefederal government, the act affirmed that "Indian tribes have the exclusive right toregulate gaming activity on Indian lands if the gaming activity is not specificallyprohibited by federal law and is conducted within a State which does not, as a matterof critninal law and public policy, prohibit such gaming activity."^ In essence. Congresswas trying to work out a law consistent with the federal policies of the 1980s that bothrecognized Native American sovereignty and their right to gamble to promote economicself-sufficiency and appeased the states and the non-Indian gambling lobby.'^

According to the act, the IGRA had three purposes. First, the IGRA was to promoteeconomic development on reservations, which the government recognized as devastatedby poverty and social problems. Congress hoped that this new legislation wouldeventually lead to Indian economic self-sufficiency. Second, the new law was supposedto protect Indian gaming from organized crime. Many opponents of Indian gatningargued that the Mafia would infiltrate reservation casinos, much like it had infiltratedLas Vegas and Atlantic City. Finally, the IGRA established the National liidiaii GamingCommission (NIGC), a three-memher committee under the interior secretary, toregulate and control Indian gaming operations. Although the president and the secretaryof the interior would appoint the committee, two of the three members would he NativeAmerican."

In order to regulate and oversee Indian tribes efficiently, the IGRA divided gaminginto three distinct classes. Class 1 consisted of all social and traditional gamblingassociated with tribal ceremonies or rituals. For example, this included the Cherokeehall game, a lacrosse-like athletic contest that carries tremendous cultural and socialsignificance. For the most patt, American Indians do not directly benefit economicallyfrom Class I gaming. Class II gaming included bingo, lotteries, and pull tabs, three formsof gambling already popular on many reservations, including Qualla, and also legal inmany states. Class III gambling, the heart of the reservation gambling debate, consistedof all casino-style games including dice games, card games, slot machines, and videomachines. Although Congress placed very few restrictiotis on Class 1 and Class II games,the IGRA required Indian tribes to negotiate a compact with the state their reservation

8. Anne Merline McCulliich, "The Politics of Indian Gaming," PMÍ̂ ÍÍMS 24 (sirmmcr 1994): 101; Lane, Returnof the White Buffalo, 127; Gabriel, Gambler Way, 186; Eadington, Indian Gaming and the IMW, 6-9; Wilkinsand Ritter, "Will the House Win?" 313.

9, hviian Gaming Regulatory Act, Public Law 497, 100th Cong., 2d sess. (October ! 7, 1988), 2467-2488,hereinafter cited as Indian Gíimín^ Act.

10. Indian Gaming Aci, 2467-2488,

11, Indian Gaming Act, 2467-2488; Stein, "American Indians," 151; McCulloch, "Politics of IndianGaming," 101 ; Eadington, indian Gaming and the Law, 6-9.

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When Hurrah's Chtrokee Casino opened ;ir 10:00 A.M. on November 13, 1997, thousands of gamblers waited inline in [he rain tdtry their luck;it the new video gaminf̂ machines. TKtoughtiLit the 1970s and 19aOs, as stares ineffect decriminalized gaming hy promoting state lotteries, the popularity of gamhlins soured. In 1993, moreAmericans had visited a casinu than attended a majur league hasehall game, Photograph hy Chuck Liddy,Novemher 14, 1997, cuurtesy of the Raleigh News aiui Observer.

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was located within if they wanted to establish casino-style or Class III gamblingoperations. Although this requirement seems to favor state governments, the lawrequired governors to negotiate "in good faith" with Indian tribes. If states refused toparticipate in negotiations, tribes could sue them in federal court.'^

The haste with which Congress wrote and passed the IGRA led to numerous flawsand inadequacies in the legislation. Rather than solving the problem of Indian gamblingwithin state borders, the IGRA simply shifted the debate to the court system, the states,and the NIGC. The ambiguous definition ofthe "in good faith" clause would plagueIndian-state relations throughout the 1990s. Ultimately, state governments would argue,and the Supreme Court wiiuld agree, that the law violated the Eleventh Amendment,which maintains that states cannot be sued by other states or foreign states. This ruling,and other problems in the 1990s, would spark intense debate in the Cimgress overrevising the IGRA.'*

On the surface, the passage of the IGRA appeared to be a blow to Indiansovereignty and reservation gaming while reaffirming states' rights. After all, Indiantribes could only open casino-style establishments if state law allowed such games,and even then Native Americans would have to negotiate contracts with hostilegovernors. Furthermore, if a state wanted to close an Indian casino, it could simplyoutlaw all gambling. The law explicitly stated that states could prohibit, but notregulate, gambling. This hardly seemed like the boost to tribal sovereignty that manycongressmen claimed.''*

In reality, though, the IGRA actually opened the door, at least temporarily, toreservation gambling for many Native American tribes, including the Eastern Band otCherokees. Because of their dependence on lotteries and other forms of gaming forrevenue, most states were not very likely to criminalize al! types of gambling. Accordingto the new law, if some forms ot gaming are legal, states cannot regulate those activitieson reservations. Therefore, only Hawaii and Utah, the two states that had totallyoutlawed gambling, could completely prohibit Indian gaming. Ironically, the growingpopularity of legalized gambling in the United States in the late 1980s and early 1990s,which many states supported and encouraged, prevented states from outlawingreservation gaming. According to the IGRA, if states could use gambling to increaserevenues and prime their economy, Indian reservations could also.'''

Furthermore, at least initially, the vague language of the IGRA helped Indian tribesmore than state governments. Many Native Americans used the "in good faith" clauseto force governors into negotiations. If the governors refused, the tribes threatened tosue. At this time, many federal judges appeared to sympathize with the plight ofAmerican Indians, especially given the language of the Cabazon decision and theeconomic problems plaguing many reservations. It did not hurt that the public also

12. Gabriel, Gambler Way, 186; Davis and Hudman, "History of Indian Gaming Law," 82; Stein, "AmericanIndians," 151.

13. Cherokee One Feather, January 13, May 12, 1993; Wilkins and Ritter, "Will the House Win?" 314-319;McCuUoch, "Politics of Indian Gaming," 102; Eadington, indiati Gaming and the Law, 6.

14. Wilkins and Ritter, "Will cbe House Win?" 313.

15. McCuUuch, "Politics of Indian Gaming," 113.


INDIAN GAMING 159

seemed to sympatbize witb Indian tribes. Nottb Carolina governor Jim Hunt freelyadmitted tbat tbe only reason be agreed to negotiate witb the Cherokees was that federallaw required bim to do so.'^

Facing severe poverty and a sagging tourist economy, tbe Cberokec Tribal Council,witbout consulting tbe Cberokee people, opted to pursue tbe possibility of bringinggambling to tbe Qualla reservation. Since tbe 1950s, tbe Chetokees had been heavilydependent on tbe tourist industry. Vacationers visiting tbe Great Smoky MountainNational Park regularly stopped in Cberokee to purcbase "authentic" Indian arts andcrafts. During tbe 1960s and 1970s, tbe tourist economy boomed on tbe reservation,bringing in much-needed revenue. Starting in the 1980s, though, intense competitionfrom surrounding attractions siphoned valuable dollars away from Cberokee. In 1994,tribal officials estimated tbat tourist revenues bad decreased 15 to 20 percent becauseof new attractions, sucb as tbe large amusement park Dollywood, in east Tennessee.Witbout new attractions to entice travelers, the Cberokees were losing tbe battle forsummet tourists.

Statistics from tbe 1990 United States census underscored the economic problemsfaced by tbe Cberokees. In 1990, tbe per capita income on tbe reservation was about$7,000. The median family income was only about $17,500, compared to $31,500 fottbe rest of North Carolina. In 1990, one Cbetokee out of three lived below the nationalpoverty line; tbe reservation poverty rate was triple that of tbe test t)f tbe state. Tbeyearly unemployment rate, a misleading figure because it failed to take into acctjunttbe seasonal nature of tbe tourist industry, was still a staggering 18 percent. In tbe winter,when many shops, restaurants, and hotels close, unemployment on tbe reservation couldreacb 40 percent ot bigher. By every economic measure, tbe Cberokees, like almost allAmerican Indian tribes, lagged well bebind tbe rest of tbe country.''

Along with a struggling economy, tbe Eastern Cberokees also faced spending cutsftom an increasingly hostile federal government forced to address the mounting budgetdeficit. By the late 1980s, tbe United States faced an increasing yearly budget deficit,•A trillion-doUat national debt, a bloated federal bureaucracy, and a looming recession.Tbrougbout tbe 1980s, as Reagan encouraged Native Americans to pull themselves upby their bootstraps, tbe federal government started dismantling many Indian programs.For more tban one hundred years, the Eastern Band of Cherokees bad been dependentpartly on federal aid. Since tbe 1950s, the Cberokee private economy bad been heavilydependent on summer ttuirism. In tbe early 1990s, however, the future of botb sourcesof income looked sbaky at best.'**

16. Cherokee One Feather, January 6, April 28, 1993, April 20, May 18, 25, September 7, 1994, February 7,1996; AikniahunmlaiidCanstitutian, October 25, 1998; Knoxvilh Ncws-Scminel, Octol^r 26, 1997; AshevilleCitizen-Times, October 7, 1997; Washington Post. September 21,1993; John R. Finger, Cherokee Americans:The Eastern Band of Cherokees in the Twentieih Century (Lincoln: University of Nebraska Press, 1991 ), 137-144;McCuIlocb, "Politics of Indian Gaming," ÎI3; Wilkitis and Ricter. "Will the House WinT 312.

17. Bureau of tbe Census, Í 990 Census of the Population: Characteriscics of Arnerican îruiians by Tribes andLanguages (Washington: Government Printing Otfice, 1994). 185.

18. United States Office of Management and Budget, ¡988 Budget of the United States (Washington:Government Printing Office, 1988), 202-203, 213, 441-442; United States Office of Management andBudget, ¡980 Budget of the United Stales (Washington: Govemmcnt Printing Office, 1980), 1N43-1N80;Finger, Cíieroíc^e Americans, 147: Cherokee One Feather, April 7, 1993, September 22, 1995; NashvilleTenTiessean, November 9, 1997.

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Given this dismal economic forecast, and the lack of other viable alternatives, theCherokee Trihal Council argued that their future depended on gambling. Trihalofficials contended that gaming would solve the seasonal natute of their local economyhy dtawing visitors twelve months a year while almost completely eliminatingunemployment. From the beginning, trihal ofïicials argued that the primary purposeof the casino was to cteate joKs fot unemployed Cherokees. Fiitthermote, theCherokees could use the profits from gambling to fund social programs devastated hyspending cuts. Casino profits could pay for new and improved schools, reservationinfrasttLicture, health care, housing, and nutritional programs for children and theelderly. The trihal council's pro-gambling arguments were strikingly similar to therhetoric used by many states to promote lotteries. Located within 500 miles of overone-half of the nation's population, and within IQQ miles of more than 14 millionpeople, Cherokee appeared to be the perfect location for legalized gambling.Consequently, to many Chetokec officials, gambling looked like a sure bet.'''

From the beginning, the North Carolina state government resisted Cherokee effortsto bring gambling to the Qualla reservation. In 1991, Cherokee officials asked Gov. JimMartin to open negotiations over a Class III compact. Martin wanted to avoid anypotentially conftontational or divisive issues; consequently, he stalled for over a year.On December 18, 1992, the Cherokees filed a lawsuit against the state and the governor,claiming that Martin had refused to negotiate "in good faith," as requited by the IGRA.Martin effectively passed the problem on to his successor, Jim Hunt. Soon after hisinauguration. Hunt publicly stated his position on Indian gaming; though he waspersonally opposed to all forms of legalized gambling, he would negotiate with theCherokees because he was required to do so hy federal law.̂ "

Initially, Hunt did not helieve that any form of gambling other than bingo was legalunder North Carolina law. In an effort to compete with South Carolina, however, thestate had relaxed its video gaming laws in 1993. According to the new revisions, videogaming machines were legal if they required skill or dexterity, not just luck, and allowedpayoffs often dollars or less. Therefore, North Carolina's video gaming laws were nowregulatory, not prohibitory, in nature. According to the Cabazon decision and the IGRA,states could prohibit, but not regulate, gaming. Pethaps unwittingly. North Carolinahad legalized reservation video gambling and shifted bargaining powet in favor of theCherokees. The vague language of North Carolina's "skill and dexterity" clause, muchlike the foggy "in good faith" clause in the IGRA, ultimately benefited the Cherokeesby opening the dijor to video gaming.^'

Although Hunt and the state government continued to stonewall, the mostimpassioned resistance to gambling on the Qualla reservation came from within theCherokee community. From petitions to advettisements, the often hostile internalopposition took a variety of forms, but most Cherokees who opposed a modern casinofeared the potential social and moral costs often associated with legalized gambling.

19. Nashville Tenrtessean, November 9, 1997; Wilmingian Morning Star, Januiiry 30, 1995; Cherokee OneFeather, April 21. 1993; News aiid Observer, Octoher 19, 1997.

20.C/ierü/i£eOncFea[/ier,januarv6, April 7, May 12,26. 1993, May 18, July 27, 1994.21. Cherokee One Feather, April 13, 20, May 25, August 31, 1994.

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Furthermore, given the tumultuous events of the 1980s, many Cherokees also distrustedtheir own tribal gtwemment.

Cherokee Christian conservatives, especially Southern Baptists, wete the most vocalcritics of legalized gambling on the reservation. In May of 1994, the Cherokee Churchof Christ placed a half-page advertisement in the Cherokee One Feather, the official tribalnewspaper, entitled "Gambling: The Devil's Golden Carrot." The advertisement warnedof the potential social and moral costs of state-sanctioned gambling and challenged theCherokee people to resist the construction of a new casino. Within the religiouscommunity, several prominent leaders led the attack. Denny Crowe, a Cherokee andthe minister of Old Antioch Baptist Church, quickly became the unofficial leader inthe moral crusade to keep gambling off the reservation. Crowe argued that theestablishment oi organized gaming would result in the moral decay of the Cherokeepeople and open the door to other sins such as alcoholism, prostitution, and drugaddiction. To this day, Crowe, his wife, and about fifty members of his congregationcontinue to refuse their per capita checks from gambling profits, which they characterizeas "sin money." Other religious groups, both on and around the reservation, also resistedthe legalization of gambling for moral reasons.^^

Along with religious conservatives, cultural conservatives also organized to resist theexpansion of reservation gambling. In 1993, a number of CKerokees formed the EasternCherokee Defense League (ECDL), an organization dedicated to preserving traditionalculture. The ECDL argued that a casino would only henefit a select few who ownedmotels, restaurants, and convenience stores, while the vast majority of the reservationwould temain impoverished. Furthermore, though economically dependent on thetourist trade, the ECDL believed a casino would further erode tribal customs andfolkways. Louise Bigmeat Maney, ownet of a popular authentic Cherokee pottery andarts and crafts stote, summed up the concerns of many cultural traditionalists: "we aretrying to teach our children how to shoot the blow guns, bows and arrows—differentgames, older games."''

Older members of the community were also skeptical of the "new white buffalo."Walker Calhoun, an influential spiritual leader, warned that gambling would erode tribalsovereignty by allowing non-Indians to control Cherokee affairs. Like most NativeAmerican tribes, the Cherokees have only recently started to gain a measure ofautonomy and political self-sufficiency. Many prominent Indian leaders worry thatgambling might erase the progress made over the past thirty years. "The young peoplethink it's going to be our salvation," Calhoun told a teporter in Match of 1995, "1 thinkit will be our danmation."^''

Beyond the ideological resistance, other Cherokees had more basic concerns. Anumbet of critics pointed to the social costs usually associated with legalized gambling.Traffic on the reservation, a growing environmental concern during tt>urist season,would increase. Crime rates could go up. Compulsive gambling, already prevalent in

22. Cherokee One Feather, May 25,1994, March 29,1995; NashviUe Tmnessean, November9,1997; KnnxviÜeNews-Sentinel October 2(i, 1997.23. News and Observer, June 9, 1997; Knoxville News-Sentincl, October 26, 1997; CheTokec One Feaiher.

August 17, 1994.24. Neuis and Observer, March 12, 1995; C/iero/a'e One Feather, February 14, 1996.

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the tribal bingo hall, could get much worse. Other critics raised numerous questions:Wííuld gambling affect federal benefits? How would a casino affect property taxes?Would the casino hire mostly Indians? How would the casino affect other tourism?Would it chase families or loyal customers away? Who would oversee the operation?What would happen if the Cherokees became dependent on gambling but then the lawschanged? Despite the potential economic benefits, many Cherokees remained highlyskeptical of large-scale reservation gambling.^^

Despite their different reasons, most of the Cherokees opposed to gambling in general,and the casino in particular, exhibited an inherent distrust ofthe tribal council and theprincipal chief. From the beginning, the Cherokee Tribal Council and Principal ChiefJonathan Taylor conducted many of their meetings regarding gambling in secret.Normally, tribal council meetings are broadcast over the local cable access channel onthe reservation so that all Cherokees can watch the proceedings. Many of the meetingsinvolving tribal gaming, however, were blacked out. Furthermore, Chief Taylor andother Cherokee officials also kept the details ofthe negotiating process secret. Taylorcontended that the whole procedure, both the meetings with Hunt and the tribalcouncil meetings, was conducted in private to strengthen the tribe s negotiating positionwith the state. If the Cherokees exhibited any internal weakness or factionalism, it mightharden the governor's resolve. This may well have been true, but the secrecy of the wholeprocess contributed to the paranoia and anxiety on the reservation over gambling. ManyCherokees feared that members ofthe tribal council might be selling out the tribe fortheir personal benefit."*'

The tribal council's refusal to hold a reservation-wide referendum on legalizedgambling only contributed to the heightened anxiety and increased distrust ofthegovernment. On four separate occasions, the tribal council rejected proposals to holdan open election on the issue. In response, angry Cherokees paid for an advertisementin the Cherokee One Feather demanding that the tribal council at least let the peopleopenly speak their mind and ask questions. Virginia Sexton, an opponent of gambling,agreed to accept the decision of the C'herokee pei)ple if the council would only let themvote. Overwhelmingly, the council said no. In justifying this decision, tribal councilmember and editor of the Cherolœe One Feather, Richard Welch, argued that only a smallminority of Cherokees even wanted a referendum. Furthermore, Welch contended thatthe Cherokees had already voted on reservation gambling in 1981 when the councilpassed legislation legalizing tribal bingo. Although technically correct, Welch'scomparison of bingo to casino gaming appeared to critics to be quite a stretch. To Welchand other members of the council, though, gambling appeared to be the only way tostimulate Cherokee's economy. The council's reasoning might have been sound, buttheir refusal to open up tbe debate to the people only invigorated opposition andincreased suspicion that Taylor, Welch, and others were trying to sneak legalizedgambling onto the reservation through the back

25. News and Observer, June 9, 1997; Cherokee One Feather. May 25, June I, August 31, 1994; AshcvilleCitizen-Times, October 27, 1997.

26. Cherokee One Feather, May 25, June 8, July 6,1994.

27. Cíieroícee One Feather, May 18, 25, June 8, July 6, B , August 10, 1994; AsheviUe Citizen-Tnnes,October 27, 1997,

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The anxiety and divisivenessof the tribe over reservation gatnbling were fueled in part by Principal Chief JonathanTaylor's decision to conduct private n̂ ihal council meetings, nonnally broadcast over the local cable access cbannel,to discuss the eonttoversial issue. Cbief Taylor also met privately with Guv. Jim Hunt to discuss reservation gamingand appointments to the gaming certification commission. Photograph of Chief Taylor (right) and Governor Huntcourtesy of the Cheraícee Oie Ft'iitfier, August 24, 1994.

Based on tbe history of tribal bingo, Cberokee concerns were understandable. Afteropening in 1982, tbe reservation bingo operation was plagued by accusations of fraudand corruption. Tbc rumors proved accurate when an investigation led to tbe arrest oftwo men for fraud and embezzlement. The two bingo contractors, botb non-Indians,were found guilty, sentenced to six years in prison, and fined $125,000. Given thepopularity of bingo and tbe fact tbat it attracted thousands of tourists ftom all ovet tbeeastern United States, tbe Cberokees were reluctant to ban tribal bingo. Following thescandal, however, the tribal council turned control of tbe operation over to Bill Beck,a Cberokee, in 1987. Furthermore, the council promised to play a more active role inoverseeing bingo. Many Cbetokees, tbougb, remained skeptical about outsidersconducting business on tbe reservation.̂ *^

Despite these misgivings, the tribal council overwhelmingly passed the EasternCbemkee Gaming Ordinance with an elcven-to-one vote in May of 1994. Even overthe complaints of Cbristian conservatives, cultural traditionalists, and numerous others,the council and Cbief Taylor remained firmly committed to bringing reservationgambling to the town of Cherokee. By ignoring tribal concerns and complaints, the

28, News and Observer. March 12, 1995, OctoL^r 19. 1997; AsheviUe Citizen-Times. October 26, 1997; Finger,Cíieroííee Americans, 160-161.


INDIAN GAMINU 145

tribal council, acting unilaterally, decided to pursue casino gaming. Now, Cherokeeofficials had to get a reluctant governor to go along with the ordinance.^"^

In the summer of 1994, more than three years after initial meetings with officials fromthe North Carolina state govemment, Cherokee officials finally succeeded in forcingGovernor Hunt into real negotiations. As a result. Hunt and Chief Taylor, the primaryCherokee negotiator, signed a gaming compact in August of 1994. According to the seven-year contract, the Cherokees could open a single 60,000-square-foot casino on theirreservation, with the pt)ssihility of other casinos in the future. Furthermore, only videogames that required skill or dexterity would be legal, and jackpots would be limited to$25,000, the maximum payoff allowable under North Carolina law for charity raiïfles. Thegaming compact also established a state oversight committee and declared NorthCarolina's right to inspect the casino's books whenever it wanted, a significant victoryfor Hunt. After it was signed by both parties, Cherokee officials passed the contract onto the NIGC, where it would ultimately have to be approved by the secretary of theinterior, Bruce Babbitt. At this point, however, all of the parties concerned knew it wouldonly be a matter of time before legalized gambling was established in Cherokee.'"-^

Despite opposition from a variety of sources, all resistance to the tribal council was, inretrospect, futile. Given the popularity of gambling in the 1990s, the vague and obscurewording of the IGRA, and the language of the Cabazon decision, opponents of gamblingon the Qualla reservation were virtually helpless. Firmly committed to gambling as theanswer to Cherokee's economic problems, the tribal council had the power of theCherokee law, the state law, and the current federal law on its side. Though supptirted bymany on the reservation, the decision to bring legalized video gambling to Cherokee wasultimately made exclusively by Chief Taylor and the Cherokee Tribal Council.

After the secretary of tbe interior approved the contract in September of 1994, amakeshift video casino opened on the Qualla reservation in January 1995. Located ina small aluminum building, the casino attracted more than 1,800 people the first weekand grossed almost $400,000. While the temporary casino was experiencing its initialsuccess, the tribal council asked for proposals from established companies for permissionto build and operate a large casino on the reservation. Harrah's of Reno, Casino Magicof Biloxi, and Grand Casino of Minneapolis all paid the $150,000 mnvrefundable feejust for the opportunity to bid for gambling rights. Once again, the tribal councilcoîïducted the process in secrecy by keeping the proposals confidential. This time,however, the unity and cohesiveness that the tribal council exhibited during the fightwith Hunt for the right to open a casino quickly disintegrated. Factionalism developedwithin the tribal govemment as councilmen supported one of the three companies. Asthe negotiating process continued during the early months of 1995, the tribal councilbecame bitterly divided.''

By a sirigle vote, the tribal council chose Casino Magic over Harrah's. After the vote.Casino Magic had thirty days to meet the tribe's financial requirements or Harrah's wouldbe awarded the contract. Following the announcement, accusations of fraud and

29. CfieralieL' One Feather. April 27, May 18, 1994.

30, GherokeeOne Feather, August 3, 17, 1994.

31.Cíiero/cí:?OíieFeai/ier, September 28, November 2, 30, December 7, 1994, January 11, 25, Fcbmary 1.8,1995, August 28, 1996; Wilmington Mumm^-Star, January 30, 1995.

VCÍLUME LXXVIll • NUMBER 2 • APRIL 2001


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When the older tribal casino opened in 1995, che Cherokees looked forward to receiving an annual check fromthe casino profits. According to John Squirrell, "Tliat first year, everyhody had a good Christmas." But hecauserhe income of rrihal members hud increascxl, many federal benefirs, such as Aid to Families with DependentChildren, were cut or reduced. "People talk big about how this casino is going tu make tifc better, said Squirrell,[blur I can see that it's only goinK to make life worse." Quotation and photograpb o( John and Yahnie Squirrell hyChuck Liddy, News a\id Observer, October 19, 1997.

corruption swept ovet the reservation. Some Cherokees believed that Richard Welch andChief Taylor had used their power to influence iither councilmen to vote for Casinti Magic.Both Welch and Taylor had a friend. Bill Beck, operator of Cherokee Tribal Bingo, whowas closely associated with Casino Magic executives. Critics pointed out that Beck hadrecently paid for Welch's wedding. Furthetmore, other Cherokees began to accuse ChiefTaylor of numerous other abuses of office, including embezzlement and misappropriationof tribal funds. In March of 1995, the Federal Bureau of Investigation started inquitinginto charges of corruption. As accusations increased, tribal council meetings degeneratedinto bitter disputes and violent confrontations. After one council meeting, a fight eniptedoutside the tribal meetinghouse that eventually drew the local police."

After Casino Magic failed to meet the Chetokees' financial demands, the deal witbthe company fell through in March of 1995. The council immediately opened

32. Cfierokee One Feat/ier, January 4,18, March 1,22,1995; Nems and Oiiserver, March 12,1995, October 19,1997; As/iewiie Ci[i;en-Tiines, January 12, 1995.

VOLUME LXXVllI • NUMBER 2 • APRIL 20Ü!


negotiations with Harrah's. Having been charged with fraud themselves, the supportersof Casino Magic on the tribal council, including Chief Taylor, now cried foul, claimingthat other members of the council had deliberately sabotaged the agreement. Overopposition from Chief Taylor, the council voted to approve the offer from Harrah's afterits patent company. Promus, agreed to meet the Cherokees' financial requirements. Thenear unanimous vote gave the council a veto-proof majority that guaranteed finalacceptance of the offer from Harrah's. Consequently, Taylor could do nothing."

Given the controversy and tumult surrounding the proceedings, the Cherokeessigned a favorable deal with Harrah's, which already operated Indian casinos in Seattle,Topeka, and Phoenix. According to the five-year contract, Harrah's would get only 27.5percent of the profits the first year, though the IGRA clearly stated that non-Indianmanagers of reservation casinos could earn up to 40 percent. The percentage wouldgradually drop each year until it reached 17 percent the fifth year. After the fifth, andfinal, year of the contract, the Cherokees would take over full control of the casino.Furthermore, Harrah's agreed to donate $400,000 a year for Cherokee educationalprograms and guaranteed the Cherokees $1,000,000 a month profit for five years. Thecasino would not serve alcohol, a concern of many on the reservation, would provideday-care facilities for its employees, and would include a modem 1,500-seat theater forconcerts, shows, and sporting events. Harrah's would also give hiring priority to NativeAmericans and maintain upkeep on all of the equipment. Finally, Promus, Harrah'smother company, agreed to take complete responsibility for the $100,000,000 loanneeded to construct the new casino. Financially at least, the deal icMiked like a safe het.''^

According to the Cherokees' gaming ordinance, 50 percent of their share of theprofits would go directly to the Cherokee people in the form of per capita checks. Thesechecks would be distributed either annually or biannually and would go to all officialmembers of the Eastern Band of Cherokees, whether or not they lived on thereservation. Minors would have their checks deposited in a mutual fund until theyreached their eighteenth birthday. The other half of the profits would be used to fundsocial programs and construction projects on the reservation. Specifically, the tribalcouncil planned to use the profits to create tribal education programs, including collegeand postgraduate scholarships, construct much needed housing for the poor, and fundhealth-care programs cut by the federal government."

Although the contract with Harrah's appeared to be a victory for the council, theaccusations of corruption and fraud, the growing mistrust ofthe tribal government, andintense infighting among council members led to a political upheaval in 1995. In thefall, Cherokee voters overwhelmingly elected Joyce Dugan their first female priricipalchief while returning only two of the twelve members of the tribal council. TheCherokee people had sent a clear message that they were upset at the way theirgovernment had handled the gambling issue over the past few years. Though the tribal

33,C/ierf)/íeeOneFeíil/ier, Febmary 15,Marcb 13, April 12, December 11, 1995, Octolier 16, \997; AshevilU:Cííi;enTíme,s, Marcb 10, 1995.34. Cherokee One Feather. March 15, 1995, October 16. 1996; News andOhsen'cr, Octdher 19, 1995.

35. NemarviObserver, October 19,1997; AshevilleCitizen-Times, Febaiary 14,1997; Kmxville Níiws-Ser\úm:l,November 14, 1997,

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INDIAN GAMING 149

VOLUME LXXVlll • NUMBER 2 • APRIL 2ÛÛi

150 CHRLSTOPHER ARRIS OAKLEY

council had successfully brought gambling to the Qualla reservation, they paid a heavypolitical price for their secretive methods."'

The political fallout over the gambling issue continued after the fall elections. Facingimpeachment charges for the misuse of tribal funds, services, equipment, property, andpersonnel. Chief Taylor resigned from office shortly after the election. Many Cherokeespointed to the fact that Taylor had managed to purchase nine cars, three homes, and amotorboat during his eight-year tenure as chief on only a $36,000-per-year salary as proofof his impropriety. In April of 1996, the new council fired tribal attomey Ben Bridgers,who had worked for the Cherokees for twenty-five years, for failure to act in the tribe'sbest interest. That same month, the council also fired longtime editor of the tribalnewspaper Richard Welch, citing his questionable behavior during the gamblingdebates. In September of 1996, the council voted unanimously to fire the chairman ofthe Tribal Casino Gaming Enterprise (TCGE), which had been established by thecouncil to regulate the business activities of the casino. Once again, the council arguedthat the chairman, Jim Smith, was not responding to the concerns of the Cherokeepeople. Within a year, the Cherokee officials most responsible for bringing gamblingto the Qualla reservation had been thrown out of office for their handling of the affair.Clearly, many Cherokees had decided it was time to clean up the tribal govemmentand punish certain individuals for their questionable behavior."

As Harrah's started looking for a potential location for their casino on the reservation,the Cherokees still faced resistance from the state. In early 1996, officials from the NorthCarolina Department of Commerce released a study critical of the proposed casino.According to the study, the casino would create serious traffic problems in westem NorthCarolina, increase crime rates on the reservation and in the surrounding counties, keepfamily tourists away from the area, and result in over-development. The study alsocontended that rather than producing new jobs, the casino would simply cannibalizeolder jobs. Furthermore, the Commerce Department argued that Harrah's would onlybenefit area restaurants, hotels, gas stations, and convenience stores, while hurting localarts and crafts stores. Chief Ougan and Cherokee officials responded by arguing thatthe study was very one-sided, but many area city and county officials became increasinglyworried about the effects of a modem casino. Non-Indian business leaders and politicalauthorities in the surrounding counties feared that they would have to pay the socialcosts of legalized gambling without getting any of the economic benefits. In a wise publicrelations move designed to soothe local anxiety over the proposed casino. Chief Duganmet with more than one hundred local and state political and business leaders in March1996 and promised that the Cherokees would do their best to address any problemscreated by the casino. By meeting with local leaders, listening to concerns, andpromising to be good neighbors, Dugan proved to be a more effective ambassador fortbe Cherokees than her predecessor.'*^

36. Cherokee One Feather, February 7, June 7, November 8, 1995.37. Cherokee One Feather, February 7, Jime 7, November 8, 1995, April 3. 10, 17, June 19, September 11,1996.38. Cherokee CJne Feather. February 28, M^y 1 3, 1996; Mheville Citizen-Times, February 23, Marcb 1, 1996,October 24, 1997.

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INDIAN GAMING 151

Under tbc contract witb Harrah's, the company wt>uld pive biring priority to Native Americans, dtmate $400,000£1 year for Cberoicee evlucational programs, and guarantee tbe tribe $1,000,000 a montb profit tor five yeans. Intiiis piioto^rapb by Cbuck Liddy, workmen cake a break on a new bridge in front of Harrah's Ca.sino, News andOiiscrw)-, October 19, 1997.

VOLUME LXXVlli «NUMBER 2 • APRIL 200!


The political fallout over the gamhling issue continued after the 1995 fall elections, in which Joyce L\igan wasoverwhelmingly elected the first female principal chief. Facing impeachment charges for the misuse oí tribal funds,services, equipment, property, and personnel. Chief Taylor resigned from office shortly after the election. Thiscampaign advertisetnent for Joyce Dugan ran in the C/ieroftee Oiie Feat/ier, March 29, 1995.

The proposed casino also widened the gtowlng rift between the Cherokees andofficials at the Great Smoky Mountain National Park, adjacent to the Quallareservation. In tbe fall of 1996, tbe NIGC asked park authorities to answer questionsabout the potential environmental impact of tbe proposed casino. Accotding to thebylaws of the IGRA, an environmental impact study must be done for each proposedIndian casino. In a letter to the NIGC, park official Karen Wade responded that thecasino would affect ttaffic in the park area. Consequently, park managers would haveto hire mote rangers and also increase their toad maintenance budget. Wade also warnedof the potential ecological costs. The Great Smokies was already the most visitednational park in the country, and pollution in tbe mountains was quickly becoming aserious problem. Wade's letter outraged Cherokee officials. Claiming tbat park managerswere deliberately trying to destroy the economy of the reservation, the tribal councildemanded Wade's resignation. Park authorities responded that they were only bonestlyanswering legitimate questions from tbe NIGC. Altbough it is doubtful tbat Wade andotbets were intentionally trying to damage the reservation, the perception affected analready tense relationship between park employees and tbe Cbetokees.'''

In November of 1997, more than six years after Cherokee officials first expressedinterest in gambling, Harrah's casino opened on tbe Qualla reservation. From tbe

39. Knoxville News-Sentind, August 4, 1996; Nancy Gray, National Park Service, telephone conversationwith author, March 12, 1999; Cherokee One Feather, August 7, September 25, 1996.


INDIAN GAMING 153

heginning of the negotiating process to the signing of the agreement with Harrah's in1996, the tribal government controlled the entire procedure. In the poker game betweenthe Cherokee Tribal Council and all ofthe opponents of reservation gambling, thecouncil held all ofthe high cards. Facing severe reservation unemployment and poverty,and with few viable economic options, the tribal council exclusively decided to bringcasino gambling to the town of Cherokee. By secretly negotiating the contract withNorth Carolina officials, and unilaterally forcing the issue without a public debate, thetribal council's handling ofthe gambling issue hardened intra-tribal divisions. Christianconservatives continued to attack the casino for moral reasons. Cultural conservativessaw the modern casino as a threat to traditional Cherokee culture. Supporters of thecasino remained convinced that gambling was the only way to save Cherokee fromeconomic disaster. Although these divisions had been apparent in Cherokee societybefore, originating in the 1800s, the casino dispute intensified the intra-tribalfactionalism on the reservation in the early 1990s. In fact, what started as a debate overlegalized gambling quickly turned into a struggle for control of Cherokee identity andthe future of the reservation. All three of the competing parties had different visionsfor the future ofthe Cherokee people. With the weight of the law on its side, the pro-business faction emerged victorious, hut increased hostilities on the reservation are notlikely to suhside in the near future.

During its first year of operation, Harrah's successfully addressed many of Cherokee'seconomic problems. Reservation unemployment plummeted as the casino hired morethansixhundredCherokeesat an average salary of $25,000 per year. In January 1998,the casino was drawing more than 5,700 visitors per day. As winter tourism increased,local shops, restaurants, and stores started staying open all year. Although individualCherokees are not getting rich from gambling revenues—the per capita payments havebeen less than $2,000 per year—the casino has stimulated the local economy. Moreover,Cherokee officials have been able to use revenues to compensate for spending cuts infederal education and health-care programs. Gambling may well prove to be only ashort-term economic solution, but at least initially Harrah's looks to be a financialsuccess. Until Cherokee officials can find a way to attract other industries to theirreservation, Harrah's will likely remain tbe economic focal point on the Quallareservation.""^

On the reservation, the struggle for control continues as opponents question the long-term impact of gambling on Cherokee morality and culture. Wbile some contend thatlegalized gambling will ultimately eradicate traditional society, others see the casino asa method of preserving the Cherokee way of life. "If you don't have tbe almighty dollar,you can't make it in today's world. And we're happy to take the white man's money,"Henry Lambert told an Atlanta reporter in October of 1998. "Why do people thinkyou have to be poor to preserve your culture? You can do a lot more to preserve yourculture if you've got money."^'

Supporters of legalized gambling refer to Indian casinos as tbe "new white buftalo,"an economic miracle that will solve all the problems plaguing Indian reservations.

40, Ncit's and C3fi,serter, April 13, December 25, 1998,

41- Adama jmtrruil arid Constitution, October 25, 1998.

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I i . i inil i ' - l u s t ycat , r e s e r v a t i o n u i iLunploymcnt sluirjiîy d c t l i n t - d as t h e c a s i n o h i r e d m o r e t h a n six h u n d t e d

Cherokees at an avetagesalaty of $25,000 per year. In January 1998, more than 5,700 people visited the casino.Shops, restaurants, and stores started remaining open all yenr, stimulating the local economy. Prisciila Cooper,owner of the Shady Lane Motel, watches as cara get gridlocked in front of her motel, which is across the streetfrom Harrah's. "1 guess we had bettet (¡et used to this," she observed. " 1 think it's going to be fiood for most c\'eti'one."Photograph by Chuck Liddy and quotation from rheNeu'.s and Observer, NOVCIHIXT 14, 1997.

Opponents, on tbe otber band, characterize gambling as a "golden calf or a false saviortbat will lead to cultural and spiritual destruction. In reality, tbougb, reservationgambling is neitber. Given tbeir problems, many American Indians ultimately seecasinos as a practical or temporary solution to serious financial problems, tatber tbanan ideological symbol or an economic panacea. For a people mired in poverty, Harrab'soffered jobs and a stable source of revenue for tbe reservation. Furtbcrmore, gamblingprofits allow tbe tribal government to address tbe numerous social problems plaguingthe reservation. By November 1998, Cherokee officials bad already used gamblingrevenue to construct a new waste-water treatment plant, expand local recreationalservices, fund new cbild-care programs, and remodel tbe Museum of tbe CberokeeIndian. To many Cberokees, the casino may be a necessary evil, a final attempt toestablish economic and political stwereignty on their reservation. Although concernedabout tbe potential social costs, Joyce Dugan"*- remained a supporter of the casino

42. Chief Joyce L^jgan tost her reelection bid in 1999.

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INDIAN GAMING 155

because she understood the economic realities on most Native American reservations."Gambling is our salvation," she said in early 1996. "I don't like to admit that. Butwithout it we'd be in trouble."''^

Mr. Oakley is a doctoral candidate in history at the University of Tennessee at Knoxville. Hisdissertation is entitled "The Reshaping of Indian Identity in North Carolina, 1945-2000."

43. Gherokee One Feather, February 7, 1996; Knoxville News-Sentinel, November 1, 1998.

VOLUME LXXVIll • NUMBER 2 • AfRIL 2001

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