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Status of Gaming Enabling Laws

24 October 2000

The following are American jurisdictions having recent activity concerning legal gambling:

* States and territories with legal gaming devices are marked with an asterisk: *

States allowing, by law or compact, at least one casino (defined as having both banking card games and slot-like machines) are marked with an exclamation point: !

UNITED STATES
On April 12, 1999, Secretary of Interior Bruce Babbitt issued proposed regulations, giving himself power to approve tribal casinos over a state's objections. Florida and Alabama immediately filed suit. Conflicting bills were introduced in Congress--to explicitly give or to take away Babbitt's power--but although none have passed both houses, Babbitt has promised to wait for a court decision. In June 1999 the National Gambling Impact Study Commission filed its final report, filled with factual inaccuracies. Bills to prohibit Internet gambling passed the Senate but failed to get two-thirds majority in the House; many forms of state- licensed gaming would be exempted. A more dangerous bill would prevent money transfers for Internet gambling. The U.S. Supreme Court ruled federal laws against casino broadcast commercials were unconstitutional; state prohibitions may still be valid. Sen. Harry Reid (D-Nev.) has so far stopped bills to outlaw legal sports betting.

ALABAMA
The Seminole case began when the Poarch Band of Creek Indians sued the state because the Governor refused to negotiate for casinos. The U.S. Supreme Court: 1) ruled a state could not be sued without its consent; but, 2) refused to decide whether the Secretary of the Interior could make the gaming regulations, leaving tribes and states in limbo. The tribe is operating gaming devices in a bingo hall, while the court fights continue. District Judge Eric Fancher ruled that non-tribal Jackpot Bingo machines, which pay out $5 Wal-Mart coupons, are slot machines, despite the Chuck E. Cheese law, but dog tracks are putting in similar machines. Incumbent Gov. Fob James Jr. (R) opposed a state lottery and lost reelection to Don Siegelman (D) in Nov. 1998. But religious organizations mobilized like they never have anywhere before and in Oct. 1999 defeated at the polls a constitutional amendment to allow a state lottery. A proposal to give the state's four moribund dog tracks video poker machines died in the Senate, but attempts to bring it back to life continue.

ALASKA
Casinos are prohibited by state law. Proposals to allow cruise ship gaming and the Klawock band of Tlingit Indians to open a full casino on remote Prince of Wales Island have gone nowhere.

!* ARIZONA
Indian tribes operate casinos with slots year-round, because charities may have occasional casino nights. Former Gov. Symington signed compacts with 16 tribes, but, misreading the federal Ninth Circuit's opinion in Rumsey, refused to sign any more. In Nov. 1996, voters approved the "Fairness Initiative," requiring the state to negotiate compacts with the remaining five tribes -- the first time in American history a state voted to allow new high-stakes casinos in the face of active opposition. The 17 compacts begin to expire in 2003. In 2000, the Legislature authorized the governor to renegotiate, but imposed requirements, including that future compacts must: Set guidelines on ATMs and credit card use; require casinos to post the Arizona Lottery's problem gambling hotline number; prohibit advertising to minors; and establish a voluntary self-ban procedure for problem gamblers. The Legislature and Governor also approved raising the gambling age from 18 to 21 for all wagers, including tribal casinos.

ARKANSAS
An initiative to legalize casinos in six counties collected enough signatures to be on the Nov. 7, 2000 ballot. Similar competing constitutional amendments gathered enough signatures for the Nov. 1996 ballot; but the State Supreme Court found all bu one misleading. The remaining initiative lost by a landslide, due to the state's active religious organizations and opposition from Mississippi's casinos. This latest attempt will be beaten at the polls by the state's churches and nearby riverboat casinos.

!* CALIFORNIA
In Aug. 1999, the State Supreme Court, quoting my 1986 book, Gambling and the Law, ruled Prop. 5 violated the State Constitution's ban on Nevada- and New Jersey-style casinos. The governor, legislature and tribes put another proposal together, Prop. 1A, approved overwhelmingly by the voters on March 7, 2000. Tribes now have a monopoly on full casinos written into the Constitution. The accompanying compact, approved by the federal government in May 2000, allows each tribe to have two casinos and up to 2,000 slot machines, subject to an incomprehensible and undoubtedly illegal formula capping the state total at either 43,000 or 113,000. Amazingly, Gov. Davis failed to send a representative when tribes allocated slot machines to themselves, so the State does not know which tribes have slot machines, let alone how many there are. Approximately 42 casinos now take in more than $1.5 billion a year; they can renegotiate for more slots in three years. California will soon be second only to Nevada in casino revenue. In 2001, tribes can demand Internet lotteries. Attendance at race tracks is falling, Golden Gate Fields dropped 40% in ten years. Bill are on the governor's desk to let tracks take bets by phone and Internet; give card clubs blackjack and lock games with a revolving bank. Legislation created a gaming control commission in 1997, but Gov. Davis made his first four appointments in Aug. 2000 and still has one to go.

!* COLORADO
Five dollar maximum blackjack, poker and slot machines are in casinos in three mountain towns and on two Indian reservations. Widespread gray market video gaming devices pay off, when police aren't around. In 1994, voters overwhelmingly rejected adding new towns and slot machines in every airport. In 1996, voters again rejected expansion, voting against adding a fourth town.

!* CONNECTICUT
State and federal official are investigating allegations in the book Without Reservation, which challenges the federal recognition of the Mashantucket Pequot Tribe, owners of Foxwoods, the largest, most profitable casino in the world. Then-Gov. Weicker signed compacts giving an oligopoly on slots to the Pequots and later to the Mohegans for 25% of net slot win or $80 million, each, whichever is greater. So far, the state has received more than $1 billion. The compacts lack any limits, so both casinos keep growing. Foxwoods has a 315,310 square-foot casino with 370 table games, keno, poker tables, race book, high-stakes bingo and 5,700 slot machines. The two Indian casinos will win more than $1.5 billion this year, making them the third largest casino market in the U.S. A third and fourth tribe are close to getting federal approval.

* DELAWARE
A 1994 law allowed each of the state's three racetracks to have up to 1,000 slot-machine-like video lottery terminals (VLTs). "Racinos" opened over the 1996 New Year's Eve weekend. The Legislature keeps raising the number of permitted machines; each will soon reach the state's present limit of 2,000. Racinos have been good for the tracks: large purses have made Harrington (Midway) a national leader in harness races. Three-quarters of the Lottery's revenue now comes from VLTs.

FLORIDA
Following the Seminole decision the tribe asked Babbitt for casino regulations. Suits have been filed, but the tribe is expanding its four bingo halls/casinos with video gaming devices, without compacts or regulations. A $17 million casino initiative lost big in 1994. Proponents have turned to the Legislature for help. In March 1999, the House Regulated Services Committee approved, 8-0, electronic slots at tracks and jai-alai frontons. But claims that this would open the door to full casinos killed the proposal before it got to the floor. At least 22 casino ships operate cruises-to-nowhere out of Florida's ports. Recent court decisions could allow the state or even local governments to put the ships out of business.

GEORGIA
Three gaming ships were sailing into international waters (three miles out) for day-trips-to-nowhere, but may be sunk by state law. Georgia's State Lottery is a model for the rest of the country. The state also has charity bingo and raffles. The Kialegees in Oklahoma want to return to their traditional land and open a casino. This will not happen, because the Governor and Secretary of Interior would have to approve.

HAWAII
All gambling is outlawed, but each year dozens of bills are introduced to legalize casinos or a state lottery. A proposal for the state's employee retirement system and Office of Hawaiian Affairs to own a casino in Las Vegas aroused strong opposition. The Legislature may eventually approve casinos on cruise ships.

IDAHO
The State Constitution was amended in 1992 to specifically prohibit casino games with one target in mind: Indian casinos. The State Legislature ratified a compact Gov. Dirk Kempthorne made with the Shoshone-Bannock tribe to let a federal court decide whether gaming machines are allowed. My prediction: The court will rule video pull-tabs are forbidden slot machines. The Kootenai, Coeur d'Alene and Nez Perce are protesting, since they did agree to this compact. Some tribes are operating gaming devices anyway, without compacts. The Coeur d'Alenes, after losing court battles, closed their Internet lottery. The tribe is now trying to expand its non-casino casino: doubling the number of allegedly Class II Video Pull-Tabs to 1,000, playing blackjack with lottery cards, running mechanical horse races.

!* ILLINOIS
All nine operating riverboat casinos ceased sailing within 24 hours of Gov. George Ryan signing a bill eliminating the requirement that riverboats actually cruise. Gaming revenue increased dramatically and some boats will soon be replaced with much larger boats-in-a-moat. The state's troubled racing industry gets 15% of the casinos' adjusted gross revenue. Cook County can now have a boat-in-a-moat casino. Rosemont has been chosen, a short drive from O'Hare Airport. An appellate court ruled the inevitable lawsuit will be tried in Cook County. Under a 1990 constitutional amendment, the Legislature authorized up to 10 riverboat casinos, each with a maximum of 1,200 gaming positions. There is constant political pressure to expand, especially with 3,500 unused but already authorized gaming positions.

!* INDIANA
Gov. Frank O'Bannon, opposed to any gambling expansion, killed a dockside gaming bill in 1999, but it will be reintroduced this year. Riverboat casinos opened in 1995, after the State Supreme Court held the law constitutional. The Legislature authorized 11, but the federal government will not allow a boat on Patoka Lake. Boats on the Ohio River can only move a few feet, for fear of trespassing into Kentucky. Riverboat admission charges help subsidize the state's horse racing industry. The Pokagon band of Potawatomi Indians is trying to open a land-based casino in north-central Indiana, and Indiana Legislative Insight reports the Miami Indians have a "fairly low-key effort" to put a casino in western Indiana. A study released in 1999 found gambling, including the heavily-taxed casinos, are the state's fifth largest source of revenue. The Senate voted to allow candidates to accept contributions from casino owners, but the House of Representatives killed it by a 2-1 vote.

!* IOWA
Slots are legal at one horse and two dog racetracks, in three Indian casinos and on ten riverboat casinos -- gambling is the state's fourth largest source of income. The Racing and Gaming Commission passed regulations prohibiting casinos from expanding, banning credit card cash advances and refusing to issue new licenses. New Gov. Tom Vilsack fired most of the Commissioners for going beyond the authority delegated them by the Legislature. But the Senate and House could not agree on what changes should be made, so the governor let the regulations stand. Suit was filed to keep the ATMs, and a court ruled the Commission had exceeded its authority. Rules are being promulgated to allow ATMs in non-gaming areas. The Senate killed a proposal for a five-year moratorium, which would have been like money from heaven for existing operators. Only the State Lottery, not charities, can sell pull-tabs.

!* KANSAS
The Delaware Tribe, forcibly removed to Oklahoma around 1868 but with no reservation, wants to move back to Lawrence and open a casino. In a highly questionable move, the U.S. Dept. of Interior is approving a casino for the Miami Tribe, despite vocal opposition from Gov. Bill Graves. The state has filed suit. Gov. Graves signed and the Legislature approved casino compacts with four other tribes. Although the compacts were reported to exclude electronic gaming devices, tribal casinos have slots and video poker machines, as well as table games. Proposals to put slot machines at dog and horse tracks could not get through the Senate. In Summer, 2000, Greyhound Park in Wichita opened a drive-through betting window.

KENTUCKY
Gov. Paul Patton has proposed, but not endorsed, that the state own, but not operate, up to 14 small-scale casinos on its borders, on a local-option basis. A state-commissioned independent study instead recommended 8 casinos near major cities, which would raise hundreds of millions of dollars but lead to increased compulsive gambling. The Legislature is considering VLTs and casino gaming to save the state's racetracks, facing competition from neighboring states' riverboat casinos. A constitutional amendment is unlikely, requiring three-fifths of both houses of the Legislative and then a statewide referendum, because opposition from churches is growing. Kentucky charity bingo is bucking the national trend by growing despite competition from nearby casinos.

!* LOUISIANA
Former Gov. Edwin Edwards was convicted of racketeering for manipulating riverboat casino licenses -- I was designated an expert witness by the U.S. Dept. of Justice. In 2000 the State Legislature legalized telephone bets for races at the New Orleans Fair Grounds. Harrahs opened the first permanent casino in the heart of a large American city in New Orleans in October 1999, four years after its temporary casino went bankrupt. The Legislature will probably eliminate "phantom cruises" (raising gangplanks on boats that don't move) overruling the Gaming Control Board. Gov. Mike Foster wants riverboat casino taxes raised from 18.5% to 23.5%; it passed the House in June 2000, but failed in the Senate. More than 25 million visitors spent $1.36 billion on 13 riverboat casinos in fiscal 1998-99. The Legislature is considering eliminating the 15th license presently allowed. Some State Senators want to tax the state's three tribal casinos (it's illegal). In questionable local elections in Nov. 1996, 31 parishes voted to keep video poker machines, 33 parishes voted them out. The problem: A state law prohibiting the video poker industry from pooling resources by forming PACs was declared unconstitutional only 17 days before the vote. The U.S. Supreme Court agreed. But state and federal courts have upheld the results. More than 4,800 gaming devices were shut down, leaving about 15,000. Three more tracks are trying to get around the two-thirds vote requirement and add slots; Delta Downs wants 1,200. Truck stops now are limited to 50 machines, and they have to sell gasoline! The Legislature raised the gambling age from 18 to 21, but a state trial judge declared this violated the state constitution (it doesn't).

MAINE
The federal court ruled the Maine Land Settlement Act preempts IGRA, so, the state will not be forced to negotiate for Indian casinos. The State Senate defeated a bill which would have allowed the Passamaquoddy Tribe to run high-stakes bingo. Charities can offer limited dice and card games, including blackjack. A legislative attempt to put video gaming devices at the state's tracks faces a veto by Gov. Angus King.

MARYLAND
Tracks gave up their drive for slots, for $10 million in increased purses. A statute allows phone wagers and tracks want implementing regulations; the real goal: Internet betting. Gov. Parris Glendening appointed a task force, which voted unanimously against casinos. He then won re-election in 1998, strongly anti-gaming. There is thus no chance that charities will regain the right to run slots, nor that riverboat and land-based casino bills will become law.

MASSACHUSETTS
A bill to permit three casinos in the state appears dead, after Salisbury voted no 1,808 to 1,440. The state's horse and dog tracks need slots to survive, but they will not get them this session. Atty. Gen. Thomas Reilly is a leading opponent. Gov. Paul Cellucci says he will negotiate only Class II gaming with the Wampanoag Indians. In 1997 the Legislature kill a deal between then-Gov. Weld and the tribe for a casino in New Bedford, rather than on their inaccessible reservation. A court has upheld the right of local government to regulate or prohibit cruises to nowhere. To save charity bingo, the limit on progressive jackpots was raised from $500 to $3,000.

!* MICHIGAN
In Nov. 1996, voters approved three casinos for Detroit, despite the strong opposition of Gov. John Engler - the first time in American history that citizens of a state voted to allow new high-stakes commercial casinos in the face of active opposition. On July 29, 1999, Detroit became the largest city in the U.S. to have a land-based casino. MGM Grand's $235 million temporary facility has 75,000 square feet of gaming, with 2,300 slots and 80 table games. But we do not know how much money the city's two temporary casinos make, because the state says it is a felony to release such information. In July, 2000, federal Judge Robert Holmes Bell upheld the ordinance giving two named entities preferences in the bidding process. The Sault Ste. Marie Tribe of Chippewa Indians has been approved to buy out its partners in the Greektown casino, the first tribe to own a non-tribal casino. The state currently has 11 tribal compacts and 17 casinos. A trial judge ruled the compacts void, because the Legislature approved them by resolution, not by bill. A bill to prohibit casino ATMs is pending. The state's racetracks say they need slot machines to survive. Charity bingo revenue is down 26 percent in six years; so, the Legislature approved progressive jackpots. The limits on "Millionaire Parties," casino nights, were raised from a $2,000 prize limit to total chip sales of $15,000. A new statute appears to make Internet gambling illegal, but actually legalizes online wagering conducted by state licensed operators.

!* MINNESOTA
Seventeen Indian casinos (more than in Atlantic City) with slots. Seven gaming tribes in the U.S. own banks; the Mille Lacs Band of Ojibwe Indians own two. The first state-license card club opened April 19, 2000 at Canterbury Park in Shakopee, in direct competition with the Indian-owned Mystic Lake Casino. The Legislature refused to allow a casino constitutional amendment on the ballot, so the 38 tables (50 maximum under the law) offer only poker and player-banked games, like pai gow poker -- no blackjack or slots. Maximum opening bets $15, raises $30. Bar games, particularly charity pull-tabs, are very big: about $1.5 billion in sales in 1999.

!* MISSISSIPPI
State law allows an unlimited number of dockside and riverboat casinos; there are now approximately 30. Mississippi has become the third largest (non-Indian) casino state, with gambling revenues of $2.17 billion in 1998, 81% from 35,876 slot machines: The US Census found Mississippi led the country in revenue growth and job creation between 1992 and 1997. A tribal casino, the Silver Star, has made the Choctaws a powerful political force. The State Supreme Court ruled that race and sports books are still illegal, despite provisions in the Gaming Control Act specifically allowing "sports pools." In Nov. 1996, voters in DeSoto County, between Tunica and Memphis, again turned down casinos. In May 1999, a court threw out the third attempt by casino opponents, the American Family Association and Elizabeth Stoner, to ban gaming by initiative. A new regulation allows casino employees to play everything but progressive slots.

!* MISSOURI
It has taken four elections to make casinos legal. In early 1994, the State Supreme Court nearly destroyed the state's new riverboat casino industry by limiting the boats to games with some skill. The Nov. 1994 election amended the state Constitution to allow slot machines, keno, bingo and other games of pure chance. The Court then ruled casinos must be on a river (Station Casino recently agreed to pay a $75,000 fine for using city tap water for its "river"). The voters amended their constitution once again, to make boats-in-a-moat legal. A $500 limit on gambling losses remains, despite repeated attempts to raise it. Gov. Mel Carnahan gave the $500 limit as his reason for vetoing a "Chuck E. Cheese" bill, which would have allowed amusement games with noncash prizes up to $250. A bill in Congress would bar Indian casinos from Branson. An initiative to allow fraternal and charitable groups to have slots is gathering signatures.

* MONTANA
Religious activists failed in their attempt to put a proposed constitutional amendment on the Nov. 2000 ballot, which would have outlawed all gambling. They need only 39,724 signatures, but they could not even get half that number. Tribes were in a quandary, because some believed they alone would have been allowed to continue. At present the state has more than 16,000 video gaming machines, in more than 1,600 premises. Interestingly, more video keno than video poker. Up to 20 devices per location; maximum wager - $2; maximum payout - $800. Five tribes have compacts, allowing each to have 100 video gambling machines with $1,000 payouts, but no banking card games; two other tribes have not signed. (The Little Shell Chippewa was recognized in May 2000 but has a six month probation before gaining full tribal status.) State law allows a dozen forms of gambling, including card clubs, sports pools, Calcutta pools and fantasy sports leagues.

Continue

Status of Gaming Enabling Laws is republished from iGamingNews.com.
I. Nelson Rose

Professor I. Nelson Rose is an internationally known scholar, public speaker and writer and is recognized as one of the world's leading authorities on gambling law. A 1979 graduate of Harvard Law School, he is a tenured full Professor at Whittier Law School in Costa Mesa, California, where he teaches one of the first law school classes on gaming law.

Professor Rose is the author of more than 300 books, articles, book chapters columns. He is best known for his internationally syndicated column, "Gambling and the Law ®," and his landmark 1986 book by the same name. His most recent book is a collection of columns and analysis, co-authored with Bob Loeb, on Blackjack and the Law.

A consultant to governments and industry, Professor Rose has testified as an expert witness in administrative, civil and criminal cases in the U.S., Australia and New Zealand, and has acted as a consultant to major law firms, international corporations, licensed casinos, players, Indian tribes, and local, state and national governments, including Arizona, California, Florida, Illinois, Michigan, New Jersey, Texas and the federal governments of Canada and the United States.

With the rising interest in gambling throughout the world, Professor Rose has spoken before such diverse groups as the F.B.I., National Conference of State Legislatures, Congress of State Lotteries of Europe, United States Conference of Mayors, and the National Academy of Sciences. He has presented scholarly papers on gambling in Nevada, New Jersey, Puerto Rico, England, Australia, Antigua, Portugal, Italy, Argentina and the Czech Republic.

He is the author of Internet Gaming Law (1st & 2nd editions), Blackjack and the Law and Gaming Law: Cases and Materials.

I. Nelson Rose Websites:

www.gamblingandthelaw.com

Books by I. Nelson Rose:

> More Books By I. Nelson Rose

I. Nelson Rose
Professor I. Nelson Rose is an internationally known scholar, public speaker and writer and is recognized as one of the world's leading authorities on gambling law. A 1979 graduate of Harvard Law School, he is a tenured full Professor at Whittier Law School in Costa Mesa, California, where he teaches one of the first law school classes on gaming law.

Professor Rose is the author of more than 300 books, articles, book chapters columns. He is best known for his internationally syndicated column, "Gambling and the Law ®," and his landmark 1986 book by the same name. His most recent book is a collection of columns and analysis, co-authored with Bob Loeb, on Blackjack and the Law.

A consultant to governments and industry, Professor Rose has testified as an expert witness in administrative, civil and criminal cases in the U.S., Australia and New Zealand, and has acted as a consultant to major law firms, international corporations, licensed casinos, players, Indian tribes, and local, state and national governments, including Arizona, California, Florida, Illinois, Michigan, New Jersey, Texas and the federal governments of Canada and the United States.

With the rising interest in gambling throughout the world, Professor Rose has spoken before such diverse groups as the F.B.I., National Conference of State Legislatures, Congress of State Lotteries of Europe, United States Conference of Mayors, and the National Academy of Sciences. He has presented scholarly papers on gambling in Nevada, New Jersey, Puerto Rico, England, Australia, Antigua, Portugal, Italy, Argentina and the Czech Republic.

He is the author of Internet Gaming Law (1st & 2nd editions), Blackjack and the Law and Gaming Law: Cases and Materials.

I. Nelson Rose Websites:

www.gamblingandthelaw.com

Books by I. Nelson Rose:

> More Books By I. Nelson Rose