ALBUQUERQUE, N.M.—One of New Mexico's American Indian tribes is suing the state over failed negotiations concerning its gambling compact, alleging that Gov. Susana Martinez's administration is proposing to collect an illegal tax without providing the tribe with any benefits.

The lawsuit filed by Pojoaque Pueblo is the latest salvo in a decades-long dispute over how much revenue—if any at all—tribal casinos should share with the state.

Pojoaque Pueblo first sought a renewal of its current compact in June 2010. The state appointed a negotiator in April and the two sides met numerous times but failed to make any progress on what the tribe sees as the crux of the agreement.

The compact being sought by the Martinez administration would further restrict tribal gambling operations and would increase taxes, fees and other charges, pueblo Gov. George Rivera said Tuesday.

Rivera said such a compact would not help New Mexico's gambling industry compete with other states, especially since casino revenues have been flat since 2008 and government funding for tribes has diminished. Rivera and other tribal officials added that the economic landscape has changed since tribes last negotiated the compacts and tribes can no longer accept "the status quo from years gone by."

"The pueblo cannot agree to greater taxation and regulatory fees, the continuation of outdated business practices or new restrictions that are damaging to the industry," Rivera said in a statement.


Enrique Knell, a spokesman for Martinez, called the lawsuit unfortunate and unnecessary. He said the state has engaged in nearly 20 months of negotiations with several tribes and has sought a fair agreement with reasonable terms.

"Pojoaque's decision to take negotiations to the courts undermines the process and the good faith efforts of the state and other tribes," Knell said.

Pojoaque's current compact expires in June 2015. Pueblo officials intend to continue negotiations with the governor's office, with the goal being a compact that complies with the federal Indian Gaming Regulatory Act and ensures economic success for future generations.

The state, which has gambling compacts with 14 tribes, received more than $134 million in taxes and a share of tribal casino profits during the last fiscal year.

According to the lawsuit, the state has proposed increasing the revenue-sharing requirement for Pojoaque Pueblo from 8 percent to 9.5 percent of the tribe's net win, or gross gambling revenues. That percentage would gradually increase to at least 10.5 percent over the 23-year life of the compact.

The pueblo countered with its own offer earlier this year, which does not seek any assurances from the state for limiting gambling competition and does not include any provisions for the pueblo to share its revenue.