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In the early 1990s the 2,700-member tribe sought a compact with Nebraska to open a casino on the reservation where some 1,000 members still live. Nebraska refused to negotiate. In February 1996, when the only private employer on the reservation, a pharmaceutical company, closed its small plant, the tribe, with 59% of its members living below the poverty line, went ahead anyway, opening the Ohiya Casino and installing Las Vegas--style slot machines. Thelma Thomas, a Santee Sioux who managed the casino, recalls that the tribe thought it had "the inherent sovereign right and legal right" to offer Class III gaming because, she says, "Nebraska would not negotiate a tribal gaming compact after six years of negotiations."
The Indian Gaming Regulatory Act (IGRA), the law governing Indian gambling, seems to support the Santees' decision. The act says, "It is the committee's intent that the compact requirement for Class III not be used as a justification by a state for excluding Indian tribes from such gaming." No matter. The NIGC ordered the tribe to close the casino by May 1996. It did, with the understanding the state would work with the tribe on other economic development ventures.
When the state failed to deliver, the tribe reopened the casino in June. Enter the Department of Justice, which sued to close the operation down. The tribe, reluctant to end its one moneymaking venture, refused. A federal judge imposed a $3,000-a-day levy, then upped it to $6,000. In no time, the tribe owed more than $1 million. Meanwhile, the Justice Department began seizing the tribe's bank accounts, including those containing funds earmarked for child safety seats and nutrition programs for the elderly. It even took money out of individual Indians' accounts. Says Thomas: "They've virtually moved to shut this tribe down--the United States."
The uproar of negative publicity forced the government to return some of the money, but it is still holding most of it. And there is still $4 million in unpaid fines, according to the tribe's attorney, Conly J. Schulte. "The tribe to this day can't use bank accounts for fear that the Federal Government is just going to seize any money," says Schulte. That thwarts the tribe's attempts to invest in any business, even one having nothing to do with gambling.
Casting about for a way out of the dilemma, Schulte and Santee Sioux representatives traveled to Washington in February 2001 to seek the NIGC's guidance. Commission officials advised the tribe to install pseudo slot machines--like those used by the Seminoles--to get around the Class III controversy. The tribe complied--at a substantial economic cost. With the switch to the pseudo slots, Thomas says, revenue has fallen by two-thirds. The casino employs only 15 people, and the income barely covers operating costs. There is no longer any money for tribal programs.