Definitions; Background Investigation for Primary Management Officials and Key Employees; Gaming Licenses for Primary Management Officials and Key Employees, 48613-48615 [2022-16977]

Agencies

• DEPARTMENT OF THE INTERIOR
• National Indian Gaming Commission

[Federal Register Volume 87, Number 153 (Wednesday, August 10, 2022)]
[Proposed Rules]
[Pages 48613-48615]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-16977]


========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

========================================================================


Federal Register / Vol. 87, No. 153 / Wednesday, August 10, 2022 / 
Proposed Rules

[[Page 48613]]



DEPARTMENT OF THE INTERIOR

National Indian Gaming Commission

25 CFR Parts 502, 556, and 558

RIN 3141-AA32


Definitions; Background Investigation for Primary Management 
Officials and Key Employees; Gaming Licenses for Primary Management 
Officials and Key Employees

AGENCY: National Indian Gaming Commission, Department of the Interior.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The National Indian Gaming Commission proposes to amend its 
regulations to add definitions, amend existing definitions, and amend 
requirements for conducting background investigations and issuing 
licenses. Proposed amendments include adding general managers and other 
persons with similar management responsibility to the primary 
management official definition; limiting the definition to those with 
duties similar to those of a chief financial officer rather than 
persons who have financial management responsibility; and limiting 
primary management officials to employed management officials 
designated by Tribes instead of any person so designated. The proposed 
amendments to the key employee definition consolidate certain of its 
subsections; include gaming operation employees authorized for 
unescorted access to secured areas that are designated as such by 
Tribal gaming regulatory authorities; remove compensation as 
determinative factor with the exception of the four most highly 
compensated persons in the gaming operation; and allow Tribes to 
designate any other employee of the gaming enterprise as a key employee 
instead of ``any other person.'' Other proposed amendments incorporate 
the addition definitions for Gaming Enterprise and Tribal Gaming 
Regulatory Authority and clarify licensing application and background 
investigation retention. Specifically, the proposed amendments focus on 
licensing of primary management officials and key employees instead of 
employment of them; adding notification requirements for licensing 
revocation decisions; specifying retention requirements of information 
and documentation post termination; and changing the vesting of a right 
to a hearing to reflect Tribal law and policy.

DATES: Written comments on this proposed rule must be received on or 
before September 9, 2022.

ADDRESSES: You may submit comments by any one of the following methods, 
however, please note that comments sent by electronic mail are strongly 
encouraged.
    [ssquf] Federal eRulemaking Portal: Go to https://www.regulations.gov. Follow the instructions for submitting comments.
    [ssquf] Email comments to: [email protected].
    [ssquf] Mail comments to: National Indian Gaming Commission, 1849 C 
Street NW, MS 1621, Washington, DC 20240.

FOR FURTHER INFORMATION CONTACT: Michael Hoenig at (202) 420-9241.

SUPPLEMENTARY INFORMATION: 

I. Background and Development of the Rule

A. Background

    The Indian Gaming Regulatory Act (IGRA or Act), Public Law 100-497, 
25 U.S.C. 2701 et seq., was signed into law on October 17, 1988. The 
Act established the National Indian Gaming Commission (``NIGC'' or 
``Commission'') and set out a comprehensive framework for the 
regulation of gaming on Indian lands. IGRA requires that Tribal gaming 
ordinances provide ``an adequate system which ensures that background 
investigations are conducted on the primary management officials and 
key employees of the gaming enterprise and (ii) includes--(I) [T]ribal 
licenses for primary management officials and key employees of the 
gaming enterprise . . .; (II) a standard whereby any person whose prior 
activities, criminal record, if any, or reputation, habits and 
associations pose a threat to the public interest or to the effective 
regulation of gaming, or create or enhance the dangers of unsuitable, 
unfair, or illegal practices and methods and activities in the conduct 
of gaming shall not be eligible for employment; and (III) notification 
by the Indian Tribe to the Commission of the results of such background 
check before the issuance of any of such licenses.''
    The Commission first defined ``key employee'' and ``primary 
management official'' in April of 1992 (57 FR 123802-01). As mandated 
by IGRA, applicants for key employee and primary management official 
positions are subject to a background investigation as a condition of 
licensure. In 2009, the Commission expanded these definitions to permit 
Tribes to designate other persons as key employees or primary 
management officials (74 FR 36926). The U.S. Department of Justice, 
Federal Bureau of Investigation (FBI) took issue with this expansion, 
denying the processing of criminal history record information (CHRI) 
for the expanded positions' background investigations. This proposed 
rule rectifies that issue in part 502, limiting Tribal designations to 
``[a]ny other employee of the gaming enterprise designated by the Tribe 
as a key employee'' and ``[a]ny other employed management official of 
the gaming enterprise designated by the Tribe as a primary management 
official.''
    Background investigation and licensing regulations for key 
employees and primary management officials were initially issued by the 
Commission in January of 1993 (58 FR 5802-01) in parts 556 and 558, 
respectively. The Commission updated these regulations in 2013 to 
streamline the submission of documents; to ensure that two 
notifications are submitted to the Commission in compliance with IGRA; 
and to clarify the regulations regarding the issuance of temporary and 
permanent gaming licenses (78 FR 5276-01). As for part 556, this 
proposed rule incorporates the Gaming Enterprise definition, as needed, 
and modernizes the licensing application and background investigation 
retention requirements. And for part 558, the proposed rule emphasizes 
primary management official and key employee licensing rather than 
their employment; adds notification requirements for licensing 
revocation decisions; details the retention requirements of information 
and documentation related to key employees and primary management 
officials after their

[[Page 48614]]

employment ceases; and updates the vesting of a right to a hearing to 
include the requirements of Tribal law and policy.

B. Development of the Rule

    On, June 9, 2021, the National Indian Gaming Commission sent a 
Notice of Consultation announcing that the Agency intended to consult 
on a number of topics, including proposed changes to the key employee 
and primary management definitions and the backgrounding and licensing 
regulations. Prior to consultation, the Commission released proposed 
discussion drafts of the regulations for review. The proposed 
amendments to these regulations were intended to: address FBI's 
concerns regarding the key employee and primary management official 
definitions; include gaming operation employees with unescorted access 
to secured areas as key employees; combine certain subsections of the 
key employee definition; add general managers and similar positions to 
the primary management official definition; and update licensing 
application and background investigation retention requirements. The 
Commission held two virtual consultation sessions in July of 2021 to 
receive Tribal input on the possible changes.
    The Commission reviewed all comments received as part of the 
consultation process. Several comments were concerned that defining a 
key employee as a ``Custodian of gambling device or system records'' 
would make TGRA personnel key employees. To address this concern, the 
Commission is proposing to limit the definition to persons who perform 
that function ``for the gaming operation.'' It is not the Commission's 
intent to capture TGRA employees or non-gaming operation personnel in 
the definition. A similar comment sought clarification as to whether 
``[a]ny person authorized by the gaming operation for unescorted access 
to secured areas'' includes TGRA personnel. Again, it does not as in 
most cases the TGRA, not the gaming operation, authorizes TGRA 
personnel's access to restricted areas. However, under provision Sec.  
502.14(d)--``[a]ny other employee of the gaming enterprise designated 
by the Tribe as a key employee''--A Tribe may, at its discretion, 
designate TGRA personnel as key employees through its gaming ordinance, 
since the ``Gaming Enterprise'' definition includes ``the entities 
through which a Tribe conducts, regulates, and secures its gaming . . . 
.'' Likewise, if it so chooses, a Tribe may deem TGRA supervisory 
personnel as primary management officials under Sec.  502.19(e)--
``[a]ny other employed management official of the gaming enterprise 
designated by the Tribe as a primary management official.'' The intent 
of both proposed provisions is to provide maximum flexibility to 
Tribes.

II. Regulatory Matters

Unfunded Mandate Reform Act

    The Commission, as an independent regulatory agency, is exempt from 
compliance with the Unfunded Mandates Reform Act, 2 U.S.C. 1502(1); 2 
U.S.C. 658(1).

Takings

    In accordance with Executive Order 12630, the Commission has 
determined that the rule does not have significant takings 
implications. A takings implication assessment is not required.

Civil Justice Reform

    In accordance with Executive Order 12988, the Commission has 
determined that the rule does not unduly burden the judicial system and 
meets the requirements of sections 3(a) and 3(b)(2) of the Order.

National Environmental Policy Act

    The Commission has determined that the rule does not constitute a 
major federal action significantly affecting the quality of the human 
environment and that no detailed statement is required pursuant to the 
National Environmental Policy Act of 1969, 42 U.S.C. 4321, et seq.

Paperwork Reduction Act

    The information collection requirements contained in this rule were 
previously approved by the Office of Management and Budget as required 
by 44 U.S.C. 3501, et seq., and assigned OMB Control Number 3141-0003.

Tribal Consultation

    The National Indian Gaming Commission is committed to fulfilling 
its Tribal consultation obligations--whether directed by statute or 
administrative action such as Executive Order (E.O.) 13175 
(Consultation and Coordination with Indian Tribal Governments)--by 
adhering to the consultation framework described in its Consultation 
Policy published July 15, 2013. The NIGC's consultation policy 
specifies that it will consult with Tribes on Commission Action with 
Tribal Implications, which is defined as: Any Commission regulation, 
rulemaking, policy, guidance, legislative proposal, or operational 
activity that may have a substantial direct effect on an Indian Tribe 
on matters including, but not limited to the ability of an Indian Tribe 
to regulate its Indian gaming; an Indian Tribe's formal relationship 
with the Commission; or the consideration of the Commission's trust 
responsibilities to Indian Tribes.
    Pursuant to this policy, on June 9, 2021, the National Indian 
Gaming Commission sent a Notice of Consultation announcing that the 
Agency intended to consult on a number of topics, including proposed 
changes to the key employee and primary management official regulatory 
definitions as well as the background and licensing regulations. 
Consultations with Tribes were held on July 27 and 28, 2021.

List of Subjects in 25 CFR Parts 502, 556, and 558

    Gambling, Indian lands.

    Therefore, for reasons stated in the preamble, 25 CFR parts 502, 
556, and 558 are amended as follows:

PART 502--DEFINITIONS

0
1. The authority citation for part 502 continues to read as follows:

    Authority: 25 U.S.C. 2701 et seq.

0
2. Revise Sec.  502.14 to read as follows:


Sec.  502.14  Key employee.

    Key employee means:
    (a) Any person who performs one or more of the following functions 
for the gaming operation:
    (1) Bingo caller;
    (2) Counting room supervisor;
    (3) Chief of security;
    (4) Floor manager;
    (5) Pit boss;
    (6) Dealer;
    (7) Croupier;
    (8) Approver of credit;
    (9) Custodian of gaming systems as defined in 25 CFR 547.2 and 
similar class III systems, gaming cash or gaming cash equivalents, or 
gaming system records;
    (10) Custodian of surveillance systems or surveillance system 
records.
    (b) Any person authorized by the gaming operation for unescorted 
access to restricted areas designated as restricted areas by the TGRA;
    (c) If not otherwise licensed as a key employee or primary 
management official, the four persons most highly compensated persons 
by the gaming operation.
    (d) Any other employee of the gaming enterprise designated by the 
Tribe as a key employee in its gaming ordinance.
0
3. Revise Sec.  502.19 to read as follows:


Sec.  502.19  Primary management official.

    Primary management official means:

[[Page 48615]]

    (a) Any person having management responsibility for a management 
contract;
    (b) Any person who has authority:
    (1) To hire and fire employees of the gaming operation; or
    (2) To establish policy for the gaming operation; or
    (3) To supervise a key employee of the gaming operation.
    (c) The chief financial officer or a position with duties similar 
to a chief financial officer.
    (d) The general manager or a position with duties similar to a 
general manager.
    (e) Any other employed management official of the gaming enterprise 
designated by the Tribe as a primary management official in its gaming 
ordinance.
0
4. Add Sec. Sec.  502.25 and 502.26 to read as follows:


Sec.  502.25  Gaming Enterprise.

    Gaming Enterprise means the entities through which a Tribe 
conducts, regulates, and secures gaming on Indian lands within such 
Tribe's jurisdiction pursuant to the Indian Gaming Regulatory Act.


Sec.  502.26   Tribal Gaming Regulatory Authority (TGRA).

    Tribal Gaming Regulatory Authority (TGRA) means the governmental 
entity authorized by Tribal law to regulate gaming conducted pursuant 
to the Indian Gaming Regulatory Act.

PART 556--BACKGROUND INVESTIGATIONS FOR PRIMARY MANAGEMENT 
OFFICIALS AND KEY EMPLOYEES

0
5. The authority citation for part 556 is revised to read as follows:

    Authority: 25 U.S.C. 2706, 2710.

0
6. Amend Sec.  556.4 by revising the first sentence of the introductory 
text to read as follows:


Sec.  556.4   Background investigations.

    A Tribe shall perform a background investigation for each primary 
management official and for each key employee of the gaming enterprise. 
* * *
* * * * *
0
7. Amend Sec.  556.6 by revising the first sentence of paragraph (a) to 
read as follows:


Sec.  556.6   Report to the Commission.

    (a) When a Tribe licenses a primary management official or a key 
employee, the Tribe shall maintain the information listed under Sec.  
556.4(a)(1) through (14). * * *
* * * * *
0
8. Revise Sec.  556.8 to read as follows:


Sec.  556.8   Compliance with this part.

    All Tribal gaming ordinances and ordinance amendments approved by 
the Chair prior to [EFFECTIVE DATE OF FINAL RULE] do not need to be 
amended to comply with this part. All future ordinance submissions, 
however, must comply.

PART 558--GAMING LICENSES FOR KEY EMPLOYEES AND PRIMARY MANAGEMENT 
OFFICIALS

0
9. The authority citation for part 558 continues to read as follows:

    Authority:  25 U.S.C. 2706, 2710, 2712.

0
10. Revise Sec.  558.3 to read as follows:


Sec.  558.3   Notification to NIGC of license decisions and retention 
obligations.

    (a) After a Tribe has provided a notice of results of the 
background check to the Commission, a Tribe may license a primary 
management official or key employee.
    (b) Within 30 days after the issuance of the license, a Tribe shall 
notify the Commission of its issuance.
    (c) A key employee or primary management official who does not have 
a license after ninety (90) days shall not be permitted to perform the 
duties, functions, and/or responsibilities of a key employee or primary 
management official until so licensed.
    (d) If a Tribe does not license an applicant--
    (1) The Tribe shall notify the Commission; and
    (2) Shall forward copies of its eligibility determination and 
notice of results, under Sec.  556.6(b)(2) of this chapter, to the 
Commission for inclusion in the Indian Gaming Individuals Record 
System.
    (e) If a Tribe revokes a key employee or primary management 
official's license--
    (1) The Tribe shall notify the Commission; and
    (2) Shall forward copies of its license revocation decision and a 
summary of the evidence it relied upon to the Commission for inclusion 
in the Indian Gaming Individuals Record System.
    (f) A Tribe shall retain the following for inspection by the Chair 
or their designee for no less than three years from the date of 
termination of employment:
    (1) The information listed under Sec.  556.4(a)(1) through (14) of 
this chapter;
    (2) Investigative reports, as defined in Sec.  556.6(b) of this 
chapter;
    (3) Eligibility determinations, as defined in Sec.  556.5 of this 
chapter;
    (4) Privacy Act notice, as defined in Sec.  556.2 of this chapter; 
and
    (5) False Statement notice, as defined in Sec.  556.3 of this 
chapter.
0
11. Revise Sec.  558.4 to read as follows:


Sec.  558.4   Notice of information impacting eligibility and 
licensee's right to a hearing.

    (a) If, after the issuance of a gaming license pursuant to Sec.  
558.3, the Commission receives reliable information indicating that a 
key employee or a primary management official is not eligible for a 
license under Sec.  556.5 of this chapter, the Commission shall notify 
the issuing Tribe of the information.
    (b) Upon receipt of such notification under paragraph (a) of this 
section, a Tribe shall immediately suspend the license and shall 
provide the licensee with written notice of suspension and proposed 
revocation.
    (c) A Tribe shall notify the licensee of a time and a place for a 
hearing on the proposed revocation of a license.
    (d) The right to a revocation hearing shall vest upon receipt of a 
license or at such earlier time as is determined by Tribal law, 
regulation, and/or policy.
    (e) After a revocation hearing, a Tribe shall decide to revoke or 
to reinstate a gaming license. A Tribe shall notify the Commission of 
its decision within 45 days of receiving notification from the 
Commission pursuant to paragraph (a) of this section.
0
12. Revise Sec.  558.6 to read as follows:


Sec.  558.6   Compliance with this part.

    All Tribal gaming ordinances and ordinance amendments that have 
been approved by the Chair prior to [EFFECTIVE DATE OF FINAL RULE] do 
not need to be amended to comply with this section. All future 
ordinance submissions, however, must comply.

    Dated: August 2, 2022.
E. Sequoyah Simermeyer,
Chairman.
Jeannie Hovland,
Vice Chair.
[FR Doc. 2022-16977 Filed 8-9-22; 8:45 am]
BILLING CODE 7565-01-M