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Legal Eagles

Flush with casino cash, Indian tribes' legal needs are growing

The Kalispel Tribe?s Northern Quest Casino in Airway Heights will expand dramatically this fall, becoming the Northern Quest Resort. (Courtesy of Hnedak Group)

Professor Ron Whitener (left) teaches Indian law at the University of Washington. ?There?s a push this year for legislation regarding Indian artifacts and gravesites,? says Miller Nash attorney Chris Masse (right). (Photos courtesy of Kathy Sauber)

A FEW months ago, Chris Masse, a lawyer in the Seattle office of Miller Nash, traveled to Airway Heights, near Spokane, to attend a ground-breaking ceremony for a client's resort project. Expected to cost $275 million, the project will include a 350-room hotel, a 10,000-square-foot luxury spa and a 2,300-seat event hall.

 It also will include a casino, triple the size of an existing one on the site. The casino, of course, provides an unmistakable clue about the identity of the planned resort's owner, an Indian tribe, in this instance the Kalispel Tribe, one of 29 federally recognized tribes in Washington. The planned resort underscores the importance of Indian gaming ? and the tribal revenues it generates ? as well as tribes' increasing tendency to own and operate businesses. "Resorts, spas, hotels, golf courses, retail, convenience stores ? you name it, you'll see it," says Masse.

 Casino wealth is triggering an increasing demand by tribes for more legal services. The demand has many lawyers hungrily eyeing what they hope will be a legal bonanza.

 Until recently, legal work for tribes typically involved natural resources, particularly salmon. Disputes with Washington state over tribes' rights to fish off-reservation even produced a 1977 U.S. Supreme Court ruling upholding tribal rights. But the decision didn't end the disputes. "The state and tribes are always ironing out these things," says Ron Whitener, who teaches Indian law at the University of Washington and recently joined Seattle's Foster Pepper in an "of counsel" capacity. Whitener is also a member of the Squaxin Island Tribe.

 The latest skirmish involves culverts, mostly in western Washington, built by the state. The tribes contend the culverts interfere with their fishing rights by intercepting salmon. The dispute is now before a federal district court.

 Lawyers representing tribes in natural resources and other matters must be well-versed in Indian law, which involves treaties and the relationship of tribes with the United States. "Indian law is like antitrust law; there's a whole body of cases and statutes you have to be familiar with," says Seattle's Tom Schlosser, whose firm, Morisset, Schlosser, Jozwiak & McCaw, has represented tribes in Washington and other states for four decades.

 Increasingly, lawyers also must be able to provide tribes with a broad array of other legal services. The reason: Tribes are using casino revenues to significantly expand reservation and off-reservation activities.

 A SUPREME REPRIEVE

 The casinos ? 23 of them in Washington state ? owe their existence to a 1987 U.S. Supreme Court case rejecting California's claim that it could restrict tribal gaming. The following year, Congress enacted the Indian Gaming Regulatory Act (IGRA). Among other things, IGRA regulates "Class III" gaming, which includes slot machines and other forms of casino gambling.

 IGRA also provides for states to enter into gaming compacts with tribes. Close to 30 of these arrangements ? each a bit different ? exist in Washington, where casinos also are regulated by the Washington State Gambling Commission. "The compacts generally are very complex agreements, running anywhere from 40 to 100 pages in length," says Eric Eberhard, a lawyer with the Seattle office of Dorsey & Whitney.

 Regulation hasn't prevented tribes from raking in big bucks from their casinos. In 2005, tribal casinos for the first time generated more than $1 billion in revenues.

 So what are tribes doing with their newfound wealth?

 The top spending priority, according to lawyers representing tribes, is building and replacing roads and infrastructure, a long-neglected area. "They're replacing buildings that have been run-down for a long time," says Whitener. These include schools, health care clinics, libraries and nursing homes. Tribes also are spending on social services, such as scholarships and programs that involve everything from wellness to child care, from foster care to elder care. "It's as varied as the needs of each individual tribe," says Eberhard.

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© Washington CEO Magazine 2008