Indian Gaming and the Eastern Band of Cherokee Indians



Indian Gaming and the Eastern Band of Cherokee Indians
Indian Gaming and the Eastern Band of
Cherokee Indians
t 10:00 A.M. on Ndvember 13, 1997, HarraK's Cherokee Casino opened on the
56,000-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 for
miles as thousands of gamblers waited in line in the cold rain for a chance to try their
luck at one ofthe hundreds of new video gaming machines. By noon, casino officials
were politely asking patrons to leave and return at a later date or time. Opening day
was so busy, in fact, that technical problems forced managers temporarily to close the
casino to repair faulty machines.'
Prior to the 1990s, the Eastern Band of Cherokees could never have dreamed of
opening 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 the
spreading popularity of gambling nationwide opened the door for the Chertikees, and
other American Indians, to establish reservation gambling. Facing federal budget cuts
from an increasingly hostile federal government, a declining tourist economy, and
rampant poverty and unemployment on the reservation, the Cherokee principal chief
and tribal council decided to take their own gamble and enter the gaming industry.
Overcoming both external and internal opposition to legalized gambling, the Cherokee
Tribal Council, with the help of federal law, forced the state government of North
Carolina 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 often
pitted the Cherokee Tribal Council against the state government, the federal
government, local county governments, and members of their own community. While
the final verdict on the casino will not be handed down for years, the effects of the debate
between pro- and anti-gambling factions can already be seen on the reservation, home
of about 7,000 of the 12,000 members ofthe Eastern Band of Cherokees.
Without the increasing popularity of legalized gambling in the United States, the
Cherokees could never have even conceived of initiating such a costly and controversial
enterprise. Originating in the colonial era, state-sanctioned gambling has enjoyed a
cyclical past in American history. The current growth in state-sanctioned gaming started
in 1964 when New Hampshire reinstated the lottery. The popularity of lotteries spread
throughout the 1970s and 1980s as cash-strapped states used gambling as a form of
indirect taxation. Whereas previously they attacked and prohibited gambling, state
1. News andOfaserver (Raleigh), November 14,1997; KnoxviíIeNeu's-Sencirte/, November H , 1997.
governments now actively encouraged participating in the Uittery, often spending
millions of dollars advertising on television, radio, newspapers, and highway billboards.
By in effect decriminalizing gaming, state lotteries have contributed to the fantastic
growth in gambling in the United States over the past two decades. In 1990, 17 percent
of 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 that
same 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 as
the most popular fonn of entertainment in America. In 1994, Americans legally wagered
more than $3.4 billion. By 1997, every state except Hawaii and Utah had some form
of legalized gambling. With the coinciding increase in illegal gambling, these estimates
ate probably only fractions of the total gambling in the United States.'
Several factors have contributed to this explosion in gaming. Anti-tax sentiment
has forced state governments to seek alternate sources of revenue. Consequently, state
governments use lotteries as a form of "voluntary taxation," despite the fact that lotteries
are regressive and inevitably hurt the poor more than the middle or upper classes. By
promoting and advocating lotteries, state governments have reduced the negative image
often associated with gambling. The cultural and political changes of the 1960s and
1970s have also contributed to the popularity of gambling. The secularization of
American society in general has decreased the influence of church leaders. Previously
in American history, prominent ministers and priests have led the attack on both legal
and illegal gaming. Furthermore, since the 1960s, Americans have increasingly shied
away from the use of government as a moral arbiter.^
Gambling's increasing popularity has contributed to public approval of Indian
gaming. In 1994, a Harris poll showed that 70 percent of Americans believed that Native
Americans should be allowed to operate reservation casinos. Other polls have supported
these findings. Without the growth in legalized gambling ovet the past two decades,
American Indians could never have turned to reservation casinos as their "new white
buffalo." In essence. Native American tribes have taken advantage of the growing
popularity of gambling nationwide by building casinos in states where they are currently
outlawed. Public acceptance was not enough, however. Because of their status as
domestic dependent nations under the United States government, Indian tribes also
had 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 termination
to 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 (July
1997): 32; James A. Davis and Lloyd E. Hudman, "The History of Indian Gaming Law and Casino
Development 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 David
Wasserman, "Gamhlmg Away Our Moral Capital," Public ¡merest 7 (March 1996): 58; "Gambling and the
State," 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-
Americans, the Reagan administration used .self-determination as a rationale for cutting
federal 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 poverty
and unemployment on reservations. Referring to the potential consequences of this
action, one scholar has referred to Reagan's Indian policy as "Termination by
Accountants" as the White House slashed Native American social programs.^
With limited options, some Native American tribes opened bingo parlors on their
reservation.s to offset these drastic budget cuts. Initially, the federal govemment actually
encouraged this practice. In 1979, the Seminóle Indians opened a bingo parlor on their
small reservation in Florida. It quickly grew into a $4 million per year industry. Though
local and state officials tried to close the parlor, the Supreme Court ruled that Florida
lacked the authority to interfere on Indian reservations, technically under federal
jurisdiction. In the early 1980s, the Cabazon Indians of California, a small tribe of only
twenty-one eligible voters, took the next logical step by opening a small card room an
their reservation. After local authorities shut down the makeshift "casino," the Cabazon
Indians took the state of California to court. After a number of rulings and the
subsequent appeals, the case eventually ended up before the Supreme Court. In 1987,
the Supreme Court handed down a landmark decision that shocked the country and
led to the current explosion of reservation gaming. inCahazon Band ofMisaion ¡ndiam
et al. V. California et ai., the Supreme Court ruled that although states could prohibit
bingo and gambling within their boundaries, they could not regulate said activities on
reservations because of Indians' special sovereign status under the national government.
Therefore, if states allowed any form of bingo or gambling, Indian tribes could also
establish that activity on reservations free from state interference. Delivering the
opinion of the Court, Justice Byron R. White argued that since "California permits a
substantial amount of gaming activity, including bingo, and actually promotes gambling
through its state lottery, we must conclude that California regulates rather than prohibits
gambling in general and hingt) in particular."*' The Cabazons were now free to operate
their card room.^
The Supreme Court's decision in the Cahazon case astonished and horrified state
governments and non-Indian casino owners. Fearing an explosion of unregulated
reservation gambling that would ct>mpete with non-Indian casinos and lotteries, state
governments, 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 Cnmtnercial
Gaming, 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 Gaming
and the l^w, 238.
7. Eiidington, Indian Gaming and ihe Law, 238-244; Wayne Stein, "American Indians and Gambling," in
American 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 and
Garvery, 1995), 60, 126-127, 178.
kind of federal regulation. As a result nf this intense pressure from the states and from
the powerful gamblitig lobby. Senators Daniel Inouye of Hawaii and Daniel Evans of
Washington quickly hammered out a compromise that both political parties could agree
tu 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 in
Cahazon. While underscoring the fact that Indian policy falls under the control of the
federal government, the act affirmed that "Indian tribes have the exclusive right to
regulate gaming activity on Indian lands if the gaming activity is not specifically
prohibited by federal law and is conducted within a State which does not, as a matter
of critninal law and public policy, prohibit such gaming activity."^ In essence. Congress
was trying to work out a law consistent with the federal policies of the 1980s that both
recognized Native American sovereignty and their right to gamble to promote economic
self-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 promote
economic development on reservations, which the government recognized as devastated
by poverty and social problems. Congress hoped that this new legislation would
eventually lead to Indian economic self-sufficiency. Second, the new law was supposed
to protect Indian gaming from organized crime. Many opponents of Indian gatning
argued that the Mafia would infiltrate reservation casinos, much like it had infiltrated
Las Vegas and Atlantic City. Finally, the IGRA established the National liidiaii Gaming
Commission (NIGC), a three-memher committee under the interior secretary, to
regulate and control Indian gaming operations. Although the president and the secretary
of the interior would appoint the committee, two of the three members would he Native
In order to regulate and oversee Indian tribes efficiently, the IGRA divided gaming
into three distinct classes. Class 1 consisted of all social and traditional gambling
associated with tribal ceremonies or rituals. For example, this included the Cherokee
hall game, a lacrosse-like athletic contest that carries tremendous cultural and social
significance. For the most patt, American Indians do not directly benefit economically
from Class I gaming. Class II gaming included bingo, lotteries, and pull tabs, three forms
of gambling already popular on many reservations, including Qualla, and also legal in
many states. Class III gambling, the heart of the reservation gambling debate, consisted
of all casino-style games including dice games, card games, slot machines, and video
machines. 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," PMÍ^ÍÍMS 24 (sirmmcr 1994): 101; Lane, Return
of the White Buffalo, 127; Gabriel, Gambler Way, 186; Eadington, Indian Gaming and the IMW, 6-9; Wilkins
and 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 Indian
Gaming," 101 ; Eadington, indian Gaming and the Law, 6-9.
When Hurrah's Chtrokee Casino opened ;ir 10:00 A.M. on November 13, 1997, thousands of gamblers waited in
line in [he rain tdtry their luck;it the new video gaminf^ machines. TKtoughtiLit the 1970s and 19aOs, as stares in
effect decriminalized gaming hy promoting state lotteries, the popularity of gamhlins soured. In 1993, more
Americans 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.
was located within if they wanted to establish casino-style or Class III gambling
operations. Although this requirement seems to favor state governments, the law
required governors to negotiate "in good faith" with Indian tribes. If states refused to
participate in negotiations, tribes could sue them in federal court.'^
The haste with which Congress wrote and passed the IGRA led to numerous flaws
and inadequacies in the legislation. Rather than solving the problem of Indian gambling
within 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 plague
Indian-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 over
revising the IGRA.'*
O n the surface, the passage of the IGRA appeared to be a blow to Indian
sovereignty and reservation gaming while reaffirming states' rights. After all, Indian
tribes could only open casino-style establishments if state law allowed such games,
and even then Native Americans would have to negotiate contracts with hostile
governors. Furthermore, if a state wanted to close an Indian casino, it could simply
outlaw all gambling. The law explicitly stated that states could prohibit, but not
regulate, gambling. This hardly seemed like the boost to tribal sovereignty that many
congressmen claimed.''*
In reality, though, the IGRA actually opened the door, at least temporarily, to
reservation gambling for many Native American tribes, including the Eastern Band ot
Cherokees. Because of their dependence on lotteries and other forms of gaming for
revenue, most states were not very likely to criminalize al! types of gambling. According
to the new law, if some forms ot gaming are legal, states cannot regulate those activities
on reservations. Therefore, only Hawaii and Utah, the two states that had totally
outlawed gambling, could completely prohibit Indian gaming. Ironically, the growing
popularity of legalized gambling in the United States in the late 1980s and early 1990s,
which many states supported and encouraged, prevented states from outlawing
reservation gaming. According to the IGRA, if states could use gambling to increase
revenues and prime their economy, Indian reservations could also.'''
Furthermore, at least initially, the vague language of the IGRA helped Indian tribes
more than state governments. Many Native Americans used the "in good faith" clause
to force governors into negotiations. If the governors refused, the tribes threatened to
sue. At this time, many federal judges appeared to sympathize with the plight of
American Indians, especially given the language of the Cabazon decision and the
economic 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, "American
Indians," 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.
seemed to sympatbize witb Indian tribes. Nottb Carolina governor Jim Hunt freely
admitted tbat tbe only reason be agreed to negotiate witb the Cherokees was that federal
law 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 bringing
gambling to tbe Qualla reservation. Since tbe 1950s, tbe Chetokees had been heavily
dependent on tbe tourist industry. Vacationers visiting tbe Great Smoky Mountain
National Park regularly stopped in Cberokee to purcbase "authentic" Indian arts and
crafts. During tbe 1960s and 1970s, tbe tourist economy boomed on tbe reservation,
bringing in much-needed revenue. Starting in the 1980s, though, intense competition
from surrounding attractions siphoned valuable dollars away from Cberokee. In 1994,
tribal officials estimated tbat tourist revenues bad decreased 15 to 20 percent because
of new attractions, sucb as tbe large amusement park Dollywood, in east Tennessee.
Witbout new attractions to entice travelers, the Cberokees were losing tbe battle for
summet tourists.
Statistics from tbe 1990 United States census underscored the economic problems
faced 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 fot
tbe rest of North Carolina. In 1990, one Cbetokee out of three lived below the national
poverty line; tbe reservation poverty rate was triple that of tbe test t)f tbe state. Tbe
yearly unemployment rate, a misleading figure because it failed to take into acctjunt
tbe 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 could
reacb 40 percent ot bigher. By every economic measure, tbe Cberokees, like almost all
American Indian tribes, lagged well bebind tbe rest of tbe country.''
Along with a struggling economy, tbe Eastern Cberokees also faced spending cuts
ftom an increasingly hostile federal government forced to address the mounting budget
deficit. 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 up
by their bootstraps, tbe federal government started dismantling many Indian programs.
For more tban one hundred years, the Eastern Band of Cherokees bad been dependent
partly on federal aid. Since tbe 1950s, the Cberokee private economy bad been heavily
dependent on summer ttuirism. In tbe early 1990s, however, the future of botb sources
of 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; Asheville
Citizen-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 and
Languages (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 and
Budget, ¡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; Nashville
TenTiessean, November 9, 1997.
Given this dismal economic forecast, and the lack of other viable alternatives, the
Cherokee Trihal Council argued that their future depended on gambling. Trihal
officials contended that gaming would solve the seasonal natute of their local economy
hy dtawing visitors twelve months a year while almost completely eliminating
unemployment. From the beginning, trihal ofïicials argued that the primary purpose
of the casino was to cteate joKs fot unemployed Cherokees. Fiitthermote, the
Cherokees could use the profits from gambling to fund social programs devastated hy
spending cuts. Casino profits could pay for new and improved schools, reservation
infrasttLicture, health care, housing, and nutritional programs for children and the
elderly. The trihal council's pro-gambling arguments were strikingly similar to the
rhetoric used by many states to promote lotteries. Located within 500 miles of over
one-half of the nation's population, and within IQQ miles of more than 14 million
people, 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 efforts
to bring gambling to the Qualla reservation. In 1991, Cherokee officials asked Gov. Jim
Martin to open negotiations over a Class III compact. Martin wanted to avoid any
potentially 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 his
inauguration. Hunt publicly stated his position on Indian gaming; though he was
personally opposed to all forms of legalized gambling, he would negotiate with the
Cherokees because he was required to do so hy federal law.^"
Initially, Hunt did not helieve that any form of gambling other than bingo was legal
under North Carolina law. In an effort to compete with South Carolina, however, the
state had relaxed its video gaming laws in 1993. According to the new revisions, video
gaming machines were legal if they required skill or dexterity, not just luck, and allowed
payoffs often dollars or less. Therefore, North Carolina's video gaming laws were now
regulatory, not prohibitory, in nature. According to the Cabazon decision and the IGRA,
states could prohibit, but not regulate, gaming. Pethaps unwittingly. North Carolina
had legalized reservation video gambling and shifted bargaining powet in favor of the
Cherokees. The vague language of North Carolina's "skill and dexterity" clause, much
like the foggy "in good faith" clause in the IGRA, ultimately benefited the Cherokees
by opening the dijor to video gaming.^'
Although Hunt and the state government continued to stonewall, the most
impassioned resistance to gambling on the Qualla reservation came from within the
Cherokee community. From petitions to advettisements, the often hostile internal
opposition took a variety of forms, but most Cherokees who opposed a modern casino
feared the potential social and moral costs often associated with legalized gambling.
19. Nashville Tenrtessean, November 9, 1997; Wilmingian Morning Star, Januiiry 30, 1995; Cherokee One
Feather, 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.
Furthermore, given the tumultuous events of the 1980s, many Cherokees also distrusted
their own tribal gtwemment.
Cherokee Christian conservatives, especially Southern Baptists, wete the most vocal
critics of legalized gambling on the reservation. In May of 1994, the Cherokee Church
of Christ placed a half-page advertisement in the Cherokee One Feather, the official tribal
newspaper, entitled "Gambling: The Devil's Golden Carrot." The advertisement warned
of the potential social and moral costs of state-sanctioned gambling and challenged the
Cherokee people to resist the construction of a new casino. Within the religious
community, several prominent leaders led the attack. Denny Crowe, a Cherokee and
the minister of Old Antioch Baptist Church, quickly became the unofficial leader in
the moral crusade to keep gambling off the reservation. Crowe argued that the
establishment oi organized gaming would result in the moral decay of the Cherokee
people and open the door to other sins such as alcoholism, prostitution, and drug
addiction. To this day, Crowe, his wife, and about fifty members of his congregation
continue to refuse their per capita checks from gambling profits, which they characterize
as "sin money." Other religious groups, both on and around the reservation, also resisted
the legalization of gambling for moral reasons.^^
Along with religious conservatives, cultural conservatives also organized to resist the
expansion of reservation gambling. In 1993, a number of CKerokees formed the Eastern
Cherokee Defense League (ECDL), an organization dedicated to preserving traditional
culture. The ECDL argued that a casino would only henefit a select few who owned
motels, restaurants, and convenience stores, while the vast majority of the reservation
would temain impoverished. Furthermore, though economically dependent on the
tourist trade, the ECDL believed a casino would further erode tribal customs and
folkways. Louise Bigmeat Maney, ownet of a popular authentic Cherokee pottery and
arts and crafts stote, summed up the concerns of many cultural traditionalists: "we are
trying to teach our children how to shoot the blow guns, bows and arrows—different
games, 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 tribal
sovereignty by allowing non-Indians to control Cherokee affairs. Like most Native
American tribes, the Cherokees have only recently started to gain a measure of
autonomy and political self-sufficiency. Many prominent Indian leaders worry that
gambling might erase the progress made over the past thirty years. "The young people
think it's going to be our salvation," Calhoun told a teporter in Match of 1995, "1 think
it will be our danmation."^''
Beyond the ideological resistance, other Cherokees had more basic concerns. A
numbet 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; KnnxviÜe
News-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.
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 laws
changed? Despite the potential economic benefits, many Cherokees remained highly
skeptical 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 the
principal chief. From the beginning, the Cherokee Tribal Council and Principal Chief
Jonathan Taylor conducted many of their meetings regarding gambling in secret.
Normally, tribal council meetings are broadcast over the local cable access channel on
the reservation so that all Cherokees can watch the proceedings. Many of the meetings
involving tribal gaming, however, were blacked out. Furthermore, Chief Taylor and
other Cherokee officials also kept the details ofthe negotiating process secret. Taylor
contended that the whole procedure, both the meetings with Hunt and the tribal
council meetings, was conducted in private to strengthen the tribe s negotiating position
with the state. If the Cherokees exhibited any internal weakness or factionalism, it might
harden the governor's resolve. This may well have been true, but the secrecy of the whole
process contributed to the paranoia and anxiety on the reservation over gambling. Many
Cherokees feared that members ofthe tribal council might be selling out the tribe for
their personal benefit."*'
The tribal council's refusal to hold a reservation-wide referendum on legalized
gambling only contributed to the heightened anxiety and increased distrust ofthe
government. On four separate occasions, the tribal council rejected proposals to hold
an open election on the issue. In response, angry Cherokees paid for an advertisement
in the Cherokee One Feather demanding that the tribal council at least let the people
openly 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 them
vote. Overwhelmingly, the council said no. In justifying this decision, tribal council
member and editor of the Cherolœe One Feather, Richard Welch, argued that only a small
minority of Cherokees even wanted a referendum. Furthermore, Welch contended that
the Cherokees had already voted on reservation gambling in 1981 when the council
passed legislation legalizing tribal bingo. Although technically correct, Welch's
comparison of bingo to casino gaming appeared to critics to be quite a stretch. To Welch
and other members of the council, though, gambling appeared to be the only way to
stimulate Cherokee's economy. The council's reasoning might have been sound, but
their refusal to open up tbe debate to the people only invigorated opposition and
increased suspicion that Taylor, Welch, and others were trying to sneak legalized
gambling onto the reservation through the back
25. News and Observer, June 9, 1997; Cherokee One Feather. May 25, June I, August 31, 1994; Ashcville
Citizen-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,
The anxiety and divisivenessof the tribe over reservation gatnbling were fueled in part by Principal Chief Jonathan
Taylor's decision to conduct private n^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 gaming
and appointments to the gaming certification commission. Photograph of Chief Taylor (right) and Governor Hunt
courtesy of the Cheraícee Oie Ft'iitfier, August 24, 1994.
Based on tbe history of tribal bingo, Cberokee concerns were understandable. After
opening in 1982, tbe reservation bingo operation was plagued by accusations of fraud
and corruption. Tbc rumors proved accurate when an investigation led to tbe arrest of
two 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 the
popularity of bingo and tbe fact tbat it attracted thousands of tourists ftom all ovet tbe
eastern United States, tbe Cberokees were reluctant to ban tribal bingo. Following the
scandal, 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 in
overseeing bingo. Many Cbetokees, tbougb, remained skeptical about outsiders
conducting business on tbe reservation.^*^
Despite these misgivings, the tribal council overwhelmingly passed the Eastern
Cbemkee Gaming Ordinance with an elcven-to-one vote in May of 1994. Even over
the complaints of Cbristian conservatives, cultural traditionalists, and numerous others,
the council and Cbief Taylor remained firmly committed to bringing reservation
gambling 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.
tribal council, acting unilaterally, decided to pursue casino gaming. Now, Cherokee
officials 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 from
the North Carolina state govemment, Cherokee officials finally succeeded in forcing
Governor Hunt into real negotiations. As a result. Hunt and Chief Taylor, the primary
Cherokee negotiator, signed a gaming compact in August of 1994. According to the sevenyear contract, the Cherokees could open a single 60,000-square-foot casino on their
reservation, with the pt)ssihility of other casinos in the future. Furthermore, only video
games 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. The
gaming compact also established a state oversight committee and declared North
Carolina's right to inspect the casino's books whenever it wanted, a significant victory
for Hunt. After it was signed by both parties, Cherokee officials passed the contract on
to the NIGC, where it would ultimately have to be approved by the secretary of the
interior, Bruce Babbitt. At this point, however, all of the parties concerned knew it would
only 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, in
retrospect, futile. Given the popularity of gambling in the 1990s, the vague and obscure
wording of the IGRA, and the language of the Cabazon decision, opponents of gambling
on the Qualla reservation were virtually helpless. Firmly committed to gambling as the
answer to Cherokee's economic problems, the tribal council had the power of the
Cherokee law, the state law, and the current federal law on its side. Though supptirted by
many on the reservation, the decision to bring legalized video gambling to Cherokee was
ultimately made exclusively by Chief Taylor and the Cherokee Tribal Council.
After the secretary of tbe interior approved the contract in September of 1994, a
makeshift video casino opened on the Qualla reservation in January 1995. Located in
a small aluminum building, the casino attracted more than 1,800 people the first week
and grossed almost $400,000. While the temporary casino was experiencing its initial
success, the tribal council asked for proposals from established companies for permission
to build and operate a large casino on the reservation. Harrah's of Reno, Casino Magic
of Biloxi, and Grand Casino of Minneapolis all paid the $150,000 mnvrefundable fee
just for the opportunity to bid for gambling rights. Once again, the tribal council
coîïducted the process in secrecy by keeping the proposals confidential. This time,
however, the unity and cohesiveness that the tribal council exhibited during the fight
with Hunt for the right to open a casino quickly disintegrated. Factionalism developed
within the tribal govemment as councilmen supported one of the three companies. As
the negotiating process continued during the early months of 1995, the tribal council
became 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 would
be 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.
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When the older tribal casino opened in 1995, che Cherokees looked forward to receiving an annual check from
the casino profits. According to John Squirrell, "Tliat first year, everyhody had a good Christmas." But hecause
rhe income of rrihal members hud increascxl, many federal benefirs, such as Aid to Families with Dependent
Children, 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 hy
Chuck Liddy, News a\id Observer, October 19, 1997.
corruption swept ovet the reservation. Some Cherokees believed that Richard Welch and
Chief 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, who
was closely associated with Casino Magic executives. Critics pointed out that Beck had
recently paid for Welch's wedding. Furthetmore, other Cherokees began to accuse Chief
Taylor of numerous other abuses of office, including embezzlement and misappropriation
of tribal funds. In March of 1995, the Federal Bureau of Investigation started inquiting
into charges of corruption. As accusations increased, tribal council meetings degenerated
into bitter disputes and violent confrontations. After one council meeting, a fight enipted
outside the tribal meetinghouse that eventually drew the local police."
After Casino Magic failed to meet the Chetokees' financial demands, the deal witb
the 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.
negotiations with Harrah's. Having been charged with fraud themselves, the supporters
of Casino Magic on the tribal council, including Chief Taylor, now cried foul, claiming
that other members of the council had deliberately sabotaged the agreement. Over
opposition from Chief Taylor, the council voted to approve the offer from Harrah's after
its patent company. Promus, agreed to meet the Cherokees' financial requirements. The
near unanimous vote gave the council a veto-proof majority that guaranteed final
acceptance of the offer from Harrah's. Consequently, Taylor could do nothing."
Given the controversy and tumult surrounding the proceedings, the Cherokees
signed 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 27.5
percent of the profits the first year, though the IGRA clearly stated that non-Indian
managers of reservation casinos could earn up to 40 percent. The percentage would
gradually drop each year until it reached 17 percent the fifth year. After the fifth, and
final, 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 educational
programs and guaranteed the Cherokees $1,000,000 a month profit for five years. The
casino would not serve alcohol, a concern of many on the reservation, would provide
day-care facilities for its employees, and would include a modem 1,500-seat theater for
concerts, shows, and sporting events. Harrah's would also give hiring priority to Native
Americans and maintain upkeep on all of the equipment. Finally, Promus, Harrah's
mother company, agreed to take complete responsibility for the $100,000,000 loan
needed 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 the
profits would go directly to the Cherokee people in the form of per capita checks. These
checks would be distributed either annually or biannually and would go to all official
members of the Eastern Band of Cherokees, whether or not they lived on the
reservation. Minors would have their checks deposited in a mutual fund until they
reached their eighteenth birthday. The other half of the profits would be used to fund
social programs and construction projects on the reservation. Specifically, the tribal
council planned to use the profits to create tribal education programs, including college
and postgraduate scholarships, construct much needed housing for the poor, and fund
health-care programs cut by the federal government."
Although the contract with Harrah's appeared to be a victory for the council, the
accusations of corruption and fraud, the growing mistrust ofthe tribal government, and
intense infighting among council members led to a political upheaval in 1995. In the
fall, Cherokee voters overwhelmingly elected Joyce Dugan their first female priricipal
chief while returning only two of the twelve members of the tribal council. The
Cherokee people had sent a clear message that they were upset at the way their
government 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,
council had successfully brought gambling to the Qualla reservation, they paid a heavy
political price for their secretive methods."'
The political fallout over the gambling issue continued after the fall elections. Facing
impeachment charges for the misuse of tribal funds, services, equipment, property, and
personnel. Chief Taylor resigned from office shortly after the election. Many Cherokees
pointed to the fact that Taylor had managed to purchase nine cars, three homes, and a
motorboat during his eight-year tenure as chief on only a $36,000-per-year salary as proof
of 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's
best interest. That same month, the council also fired longtime editor of the tribal
newspaper Richard Welch, citing his questionable behavior during the gambling
debates. In September of 1996, the council voted unanimously to fire the chairman of
the Tribal Casino Gaming Enterprise (TCGE), which had been established by the
council to regulate the business activities of the casino. Once again, the council argued
that the chairman, Jim Smith, was not responding to the concerns of the Cherokee
people. Within a year, the Cherokee officials most responsible for bringing gambling
to 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 govemment
and 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 North
Carolina Department of Commerce released a study critical of the proposed casino.
According to the study, the casino would create serious traffic problems in westem North
Carolina, increase crime rates on the reservation and in the surrounding counties, keep
family tourists away from the area, and result in over-development. The study also
contended that rather than producing new jobs, the casino would simply cannibalize
older jobs. Furthermore, the Commerce Department argued that Harrah's would only
benefit area restaurants, hotels, gas stations, and convenience stores, while hurting local
arts and crafts stores. Chief Ougan and Cherokee officials responded by arguing that
the study was very one-sided, but many area city and county officials became increasingly
worried about the effects of a modem casino. Non-Indian business leaders and political
authorities in the surrounding counties feared that they would have to pay the social
costs of legalized gambling without getting any of the economic benefits. In a wise public
relations move designed to soothe local anxiety over the proposed casino. Chief Dugan
met with more than one hundred local and state political and business leaders in March
1996 and promised that the Cherokees would do their best to address any problems
created by the casino. By meeting with local leaders, listening to concerns, and
promising to be good neighbors, Dugan proved to be a more effective ambassador for
tbe 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,
38. Cherokee CJne Feather. February 28, M^y 1 3, 1996; Mheville Citizen-Times, February 23, Marcb 1, 1996,
October 24, 1997.
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. In
tiiis piioto^rapb by Cbuck Liddy, workmen cake a break on a new bridge in front of Harrah's Ca.sino, News and
Oiiscrw)-, October 19, 1997.
The political fallout over the gamhling issue continued after the 1995 fall elections, in which Joyce L\igan was
overwhelmingly 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. This
campaign 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 and
officials at the Great Smoky Mountain National Park, adjacent to the Qualla
reservation. In tbe fall of 1996, tbe NIGC asked park authorities to answer questions
about the potential environmental impact of tbe proposed casino. Accotding to the
bylaws of the IGRA, an environmental impact study must be done for each proposed
Indian casino. In a letter to the NIGC, park official Karen Wade responded that the
casino would affect ttaffic in the park area. Consequently, park managers would have
to hire mote rangers and also increase their toad maintenance budget. Wade also warned
of the potential ecological costs. The Great Smokies was already the most visited
national park in the country, and pollution in tbe mountains was quickly becoming a
serious problem. Wade's letter outraged Cherokee officials. Claiming tbat park managers
were deliberately trying to destroy the economy of the reservation, the tribal council
demanded Wade's resignation. Park authorities responded that they were only bonestly
answering legitimate questions from tbe NIGC. Altbough it is doubtful tbat Wade and
otbets were intentionally trying to damage the reservation, the perception affected an
already tense relationship between park employees and tbe Cbetokees.'''
In November of 1997, more than six years after Cherokee officials first expressed
interest 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 conversation
with author, March 12, 1999; Cherokee One Feather, August 7, September 25, 1996.
heginning of the negotiating process to the signing of the agreement with Harrah's in
1996, the tribal government controlled the entire procedure. In the poker game between
the Cherokee Tribal Council and all ofthe opponents of reservation gambling, the
council held all ofthe high cards. Facing severe reservation unemployment and poverty,
and with few viable economic options, the tribal council exclusively decided to bring
casino gambling to the town of Cherokee. By secretly negotiating the contract with
North Carolina officials, and unilaterally forcing the issue without a public debate, the
tribal council's handling ofthe gambling issue hardened intra-tribal divisions. Christian
conservatives continued to attack the casino for moral reasons. Cultural conservatives
saw the modern casino as a threat to traditional Cherokee culture. Supporters of the
casino remained convinced that gambling was the only way to save Cherokee from
economic disaster. Although these divisions had been apparent in Cherokee society
before, originating in the 1800s, the casino dispute intensified the intra-tribal
factionalism on the reservation in the early 1990s. In fact, what started as a debate over
legalized gambling quickly turned into a struggle for control of Cherokee identity and
the future of the reservation. All three of the competing parties had different visions
for the future ofthe Cherokee people. With the weight of the law on its side, the probusiness faction emerged victorious, hut increased hostilities on the reservation are not
likely to suhside in the near future.
During its first year of operation, Harrah's successfully addressed many of Cherokee's
economic problems. Reservation unemployment plummeted as the casino hired more
thansixhundredCherokeesat 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 individual
Cherokees are not getting rich from gambling revenues—the per capita payments have
been 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 in
federal education and health-care programs. Gambling may well prove to be only a
short-term economic solution, but at least initially Harrah's looks to be a financial
success. Until Cherokee officials can find a way to attract other industries to their
reservation, Harrah's will likely remain tbe economic focal point on the Qualla
On the reservation, the struggle for control continues as opponents question the longterm impact of gambling on Cherokee morality and culture. Wbile some contend that
legalized gambling will ultimately eradicate traditional society, others see the casino as
a 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 think
you have to be poor to preserve your culture? You can do a lot more to preserve your
culture 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.
I i.iinili'- l u s t ycat, r e s e r v a t i o n u i i L u n p l o y m c n t 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 street
from 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 savior
tbat will lead to cultural and spiritual destruction. In reality, tbougb, reservation
gambling is neitber. Given tbeir problems, many American Indians ultimately see
casinos as a practical or temporary solution to serious financial problems, tatber tban
an ideological symbol or an economic panacea. For a people mired in poverty, Harrab's
offered jobs and a stable source of revenue for tbe reservation. Furtbcrmore, gambling
profits allow tbe tribal government to address tbe numerous social problems plaguing
the reservation. By November 1998, Cherokee officials bad already used gambling
revenue to construct a new waste-water treatment plant, expand local recreational
services, fund new cbild-care programs, and remodel tbe Museum of tbe Cberokee
Indian. To many Cberokees, the casino may be a necessary evil, a final attempt to
establish economic and political stwereignty on their reservation. Although concerned
about tbe potential social costs, Joyce Dugan"*- remained a supporter of the casino
42. Chief Joyce L^jgan tost her reelection bid in 1999.
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. But
without it we'd be in trouble."''^
Mr. Oakley is a doctoral candidate in history at the University of Tennessee at Knoxville. His
dissertation 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.
Copyright of North Carolina Historical Review is the property of North Carolina Division of Archives &
History and its content may not be copied or emailed to multiple sites or posted to a listserv without the
copyright holder's express written permission. However, users may print, download, or email articles for
individual use.
Copyright of North Carolina Historical Review is the property of North Carolina Division of Archives &
History and its content may not be copied or emailed to multiple sites or posted to a listserv without the
copyright holder's express written permission. However, users may print, download, or email articles for
individual use.

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