In her last blog post, Kathryn mentioned that it may be problematic that the latest compact between Florida and the Seminoles assigns revenue sharing payments to the state to the state's general treasury.  Well, the temperature just got turned up on that potential problem.  The U.S. Court of Appeals for the Ninth Circuit ruled in the Rincon Band case that California's demands for revenue sharing amounted to a state tax, in part because the revenue sharing payments would go into the state's general fund.  To the federal court, that looks a lot more like a tax than payments that are earmarked for, say, problem gambling treatment or mitigation of a casino's effects on the surrounding community.  The decision affirms the district court's 2008 ruling, and is consistent with an earlier case out of the Ninth Circuit, In re Indian Gaming Cases.

So how is this relevant in Florida?  Technically, the Ninth Circuit decision is only persuasive, not binding precedent in other circuits.  And, even more to the point, there is no lawsuit pending or expected in Florida, so no opportunity for another federal judge to be persuaded by the Ninth Circuit's reasoning.  But the Florida compact must be approved by the U.S. Interior Secretary.  And presumably, the Secretary will take into account the federal courts' interpretation of IGRA.  The statute requires that the Secretary review a compact, and provides that the Secretary "may disapprove" a compact for violating IGRA or other federal law, or the trust obligations of the U.S.  Even if the Ninth Circuit decision is not determinative, it certainly seems to us to be at least relevant to the Secretary's review of revenue-sharing provisions in compacts.

Read more: Court Rules for Tribes on Profit Sharing