The National Indian Gaming Commission Proposes Changes to 25 C.F.R. Part 547 Technical Standards Affecting 2008 Grandfathered Class II Gaming Systems

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NIGA Member Tribes

Chairman Ernest L. Stevens Jr.
Jason C. Giles, Executive Director
Danielle Her Many Horses, Deputy Executive Director/General Counsel

The National Indian Gaming Commission Proposes Changes to 25 C.F.R. Part 547 Technical Standards Affecting 2008 Grandfathered Class II Gaming Systems 

June 16, 2017

On June 14, 2017, the National Indian Gaming Commission ("NIGC") issued a Discussion Draft of proposed amendments to the technical standards contained in 25 C.F.R. Part 547 ("Part 547") affecting certain Class II gaming systems manufactured before November 10, 2008, currently known as Grandfathered Class II gaming systems. The NIGC is inviting tribal governments and other interested stakeholders to provide input on these amendments via written comment by July 15, 2017.

In a letter accompanying the release of the Discussion Draft, the NIGC summarized the proposed changes which seek to reorganize and revise 25 C.F.R. § 547.5, also known as "How does a tribal government, TGRA, or tribal gaming operation comply with this part?"  The proposed subsection (a) will solely address "2008 Systems," a new name proposed for Grandfathered Class II gaming systems.  All references to "Grandfather" would be removed, as would the sunset provision that initially was to take all 2008 Systems off the gaming floor by November 10, 2018.

New to the subsection would be a requirement that a Tribal Gaming Regulatory Authority ("TGRA") test 2008 Systems annually and determine whether they are compliant with all technical standards of Part 547.  If a 2008 System is not compliant, the TGRA must record "the modifications necessary for such approval" and submit this record to the NIGC.  The NIGC will still require that a TGRA not permit the use of a 2008 System unless certain sections of Part 547 are met, such as 25 C.F.R. §§ 547.8(b) (Game Initiation and Play), 547.8(f) (Software Signature Verification), and 547.14 (Minimum Technical Standards for Electronic Random Number Generation).

Other proposed changes include ensuring that all modifications to any gaming system "maintains or advances the system's overall compliance with the full standards" of Part 547.  This is in keeping with the overall goal as stated by the NIGC in its letter: "[T]o provide clarity to tribes, testing labs, and manufacturers regarding their obligations under the Technical Standards and to incentivize all systems to move towards full compliance."

The release of a Discussion Draft is the latest development in the NIGC's on-going study of the current regulation of 2008 Systems.  It received written comments and held a series of consultations earlier this year.  With the sunset clause for 2008 Systems approaching, the NIGC continues to seek information from Indian Country on the potential impact of the November 10, 2018 deadline and input as to what amendments to Part 547 may be appropriate.

As stated above, the NIGC is inviting tribal governments and other interested stakeholders to submit written comments in response to the proposed changes by July 15, 2017.  You may submit written comments via email to Vannice_Doulou@nigc.gov or by U.S. mail to:  NIGC, Attn:  Vannice Doulou, 1849 C St. NW, Mail Stop #1621, Washington, DC 20240.

The NIGC letter announcing the proposed changes may be found here

https://www.nigc.gov/images/uploads/draft%20547%20ltr%206-14-17.pdf

A red-lined Discussion Draft featuring the changes proposed by the NIGC may be found here

https://www.nigc.gov/images/uploads/Tribal%20Consultation/2017-Consultations/25%20C_F_R_%20%C2%A7%20547_5%20Discussion%20Draft%20Draft%20Redline%206-14-17.pdf

A clean copy of the Discussion Draft featuring the changes proposed by the NIGC may be found here: https://www.nigc.gov/images/uploads/Tribal%20Consultation/2017-Consultations/25%20C_F_R_%20%C2%A7%20547_5%20Discussion%20Draft%20Clean%206-14-17.pdf