A little history may bring some understanding.
Indian Tribes are considered independent governmental agencies, per the Commerce Clause in the US Constitution. As such Tribal Income is not taxable by any governmental agency, state or federal.
In 1976 a supreme court decision, Bryan Vs Itasca City, set the groundwork to enable Indian Gaming by establishing that Tribes cannot be prevented from participating in any activity that is permitted within a state and further more are not regulated by the state in which the reservation is located. Many of todays Tribal Casinos started as big stakes bingo operations. This was possible since most states permit bingo but regulate the payoffs and who can operated them. Tribes being exempt from state regulation offered large payoffs.
As time went on some tribes, like the Mescalero in NM, bootlegged equipment and installed slot machines. At first many were all electronic 'bingo' machines, but last generation slots were available and brought onto the reservations. The thought was that once on the reservation the Feds would have to come and get them. The feds tried and failed at McDowell and created a ground swell of machines into many reservations. Since it is/was a violation of federal law to bring these devices across state lines they were usually brought in late at night in rental trucks and over back roads few were ever apprehended. Once on the reservation everyone felt secure but confice and controversy with the states got pretty intense. There was a lot of tension during this period.
In 1985 the National Indian Gaming Comission, a Federal Office was created as was the National Indian Gaming Association of the Interested Tribes. NIGC was set up to find a solution to the 'Indian Gaming Problem". The Federal solution was the passage of the Indian Gaming Regulatory Act, IGRA, in 1988, which in a brief nutshell set a framework that required states to enter into compacts or operating agreements with tribes to operate Class III gaming, slots, poker, etc. It was a rocky road but many states eventually began to offer the compacts. Those states that passed laws establishing procedures to issues compacts to the tribes set processes to collect some money from th operation. Those that firmly planted their heels were eventually forced into compacts with the tribes often not as favorable to the state. I am not sure but I believe Arizona dug in their heels.
One of the things to understand some of the conflict is to remember that all Tribes are not the same. Many have lived next to each other for maybe a thousand years and hate each other. I recall attending a meeting in NM with representatives of NM Tribes where the President of one tribe refused to get out of his vehicle and sit with the others. Guess is correct, Jerry is right, poaching on another tribe's historic land using tribal trust land off the reservation.
State and communities resist because of the obvious potential negative impacts and costs. If they would have cooperated more at the outset things would be better for them. The writing was on the wall, some refused to see it.
