New Mexico, Tribe Locked In Fight Over Revenue Share

Thirteen Indian tribes have agreed to a 2 percent increase in New Mexico’s share of their gaming revenues. But the tiny Pueblo of Pojoaque have not. The state says their casino is illegal and wants it closed. The tribal council (at left, led by President Joseph Talachy) refuses and has vowed to fight.

A battle royal is heating up between New Mexico and the tiny Pueblo of Pojoaque over the latter’s refusal to join the state’s 13 other casino tribes in signing on to an increase in the amount of gaming revenue they share with the state.

The Pojoaque had a federally mandated compact with the state signed in 2001 that allows it to operate house-banked slot machines and table games in exchange for the state taking a cut of 8 percent of the revenue from those games. That compact expired June 30, and the tribe doesn’t have a new one because it opposes the state raising its share to 10 percent, an increase the other tribes accepted last year.

The Pueblo’s governor, Joseph Talachy, argues his 1,200-member tribe and its small rural casino cannot absorb the increase, which works out to an additional $1 million a year over the $5 million-$6 million the tribe paid annually under the old agreement.

“At 10 percent, we will have to fire employees,” he said. “Social programs would have to be cut, and our capital improvement money would take a hit.”

The state has blasted Talachy’s stand as “reckless” and says that as of July 1 the Pojoaque have been running an illegal gambling operation in violation of federal and state law. It wants the casino shut down.

The dispute has been see-sawing through the federal courts and the Department of the Interior for the better part of a year.

The pueblo tried to sue, claiming the state was not negotiating in good faith as required by the U.S. Indian Gaming Regulatory Act, but the case was dismissed on the basis of New Mexico’s sovereign immunity.

The pueblo then went directly to the secretary of the Interior, who can, in such cases, work out terms for gaming without a compact. But New Mexico sued the department, claiming the secretary has no right to go around a state when bad faith hasn’t been proved in court. The state won in a U.S. District Court decision rendered last year. The department has appealed the ruling to the 10th U.S. Circuit Court of Appeals.

Pending that appeal the U.S. Attorney’s Office and the National Indian Gaming Commission have declined to move against the casino, and the state, incensed over their refusal to act, is turning up the heat on the tribe’s contractors.

“The U.S. Attorney’s decision provides no protection to banks, credit card vendors, gaming machine vendors, advertisers, bondholders and others that are now doing business with an illegal gambling enterprise,” said Michael Lonergan, press secretary for Gov. Susana Martinez.

In Talachy’s view there is far more than money at stake, and he is determined to keep up the fight.

“If the state wins,” he said, “it sets a precedent for any state in the country to bully a tribe into a compact that isn’t fair.”