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Status of Gaming Enabling Laws (Continued)

24 October 2000

Continued from Part 1

NEBRASKA
The U.S. Dept. of Interior is going ahead with its highly questionable approval of tribal casinos, although opposed by the state. Tribes would like to negotiate for full casinos, but the Santee Sioux's lawsuit against the state was dismissed following Seminole. The tribe opened a casino anyway. A U.S. district judge ordered the Tribe to pay a $3,000 fine (never paid) for each day it keeps its northeast casino open after Feb. 2, 1999, and even commented that he might start imprisoning tribal leaders if his ruling is not taken seriously. Slot machine bills are under consideration in the state Legislature, but so is a proposal to abolish the State Lottery. Casino initiatives did not make the Nov. 1996 ballot, because many signatures were from people who were dead.

!* NEVADA
The Gaming Control Board promulgated regulations against kiddie-themed slots. One of the first to pass, with restrictions, was IGT's "Addams Family" slots. Federal Judge Philip Pro ruled unpaid casino markers are checks under Nevada's criminal bad checks law. In 1999, casinos won $9.02 billion, more than $5 billion from slot machines. For the first time anywhere in Nevada, gaming brought in less than half of total revenue, on the Las Vegas Strip. There are 203,000 slots in the state; most are in casinos. The Nevada Gaming Commission voted 3-2 to limit new "restricted licenses" (15 slots machines maximum) to convenience stores, supermarkets, drugstores and bars starting Feb. 1, 2000. State Sen. Joe Neal, having failed in the Legislature, is seeking 44,009 signatures on a petition to raise the gross gaming tax on the largest casinos from 6.25 percent, the lowest in the country, to 11.25 percent, $15.4 billion, with gaming revenue increasing 8.8 percent to $8.4 billion.

NEW HAMPSHIRE
State law allows video poker machines, but only if they do not pay off. Getting caught gambling became a felony on Jan. 1, 2000; so, social clubs are turning in their supposedly non-gaming devices. Cities will also lose: Manchester was getting $1,500 per license for 344 video poker machines. In May 2000, the House voted to keep a ban on gambling bills in place, killing the prospects for video slot machines at the state's four racetracks and two grand hotels; but Gov. Jeanne Shaheen is still pushing for video gaming devices.

!* NEW JERSEY
The 12 casinos in Atlantic City will win over $4 billion this year, making them the largest gaming market in the U.S., just ahead of the Las Vegas strip. The State Lottery would like to put in video lottery terminals statewide. Given the casinos' political power, the proposal seems doubtful. Off-track betting parlors will eventually be opened, and so will telephone and Internet wagers on horse races. A new state law prohibits cruises to nowhere.

!* NEW MEXICO
Gov. Johnson, elected and re-elected with the help of major tribal contributions, signed compacts for casinos, which were declared illegal. The Legislature passed a statute in 1997 legalizing them, but imposed a high (16 percent) fee. Not a single tribe has paid 100 percent. Attorney General Patricia Madrid filed suit in June 2000 and wants the casinos closed. The tribes call the fee a "tax," the State "revenue sharing." I predict the tribes will win; based on precedent and IGRA's prohibition on states demanding taxes during compact negotiations. The State Supreme Court threw out prior challenges to the compacts on procedural grounds. Tribes renegotiated with a committee of 16 legislators to lower the rate to 7.75 percent, but the full Legislature voted it down. To get the bill through, tracks and fraternal organizations got slots, too (Sunland Park opened with 300 slots in March 1999); and charities can have up to 15 table games. In 2000 the Senate approved raising the limit to 500 slot machines per track; the bill is pending in the House.

!* NEW YORK
In June 2000 the State Senate voted 61-0 to require local and legislative approval for all Indian casinos on non-tribal land, but the billed died in the Assembly. It would have killed the planned Mohawk/Park Place Catskills casino and others. Gov. George Pataki is more pro-gaming than leaders of the Legislature: They temporarily forced the Lottery to discontinue Keno, until they realized the money they were losing, and defeated constitutional amendments necessary to allow privately-owned casinos, despite the enormous success of Ontario's Casino Niagara and the Oneida tribe's Turning Stone casino. The St. Regis Mohawks opened the state's second casino in April 1999 - the state agreed to VLTs, for a share of the gaming revenue. The state is negotiating with a third tribe, the Senecas, who have put in 80 Video Pull-Tabs, which they claim are class II and do not require a compact. A state trial judge caused a stir by declaring an "Internet site creates a virtual casino within the user's computer terminal" and may be dragged into New York. Interesting, but irrelevant: this operator was a New York company! The tracks are now pushing for gaming machines. A trial court decision allows New York City to license casino day-trips-to-nowhere. The Off-Track Betting Corp. announced plans to set up the first state-sponsored Internet betting site, but the Legislature balked. Mayor Rudolph Giuliani supports putting a casino in New York City.

!* NORTH CAROLINA
State law allows video poker, but only up to three machines per location with a maximum payout of $10 in merchandise per session. The State Senate, fearing an influx of banished video poker machines from South Carolina, passed a billed outlawing all gaming machines, but expressly exempted federally recognized tribes. In 1994, the Governor signed a compact allowing the Cherokees to offer video gaming at one bingo hall. A subsequent decision of the state Court of Appeals raises questions about the legality of video poker, but, the tribe is continuing to operate its 2,300 machines. The House approved, 91-11, a bill to virtually outlaw casino cruises-to-nowhere from the North Carolina coast.

!* NORTH DAKOTA
Low-stakes charity blackjack in hotels and four Indian casinos with slots; Spirit Lake has 500 slots, blackjack, craps, poker, simulcast racing, bingo and keno. Voters feel the state has enough gambling: In 1996, a proposal for video gaming was defeated at the polls; in 1986, voters rejected establishing a State Lottery -- one of only three states to do so this century.

OHIO
In 1996, a riverboat casino initiative was defeated 62 percent to 38 percent. Casino bills and initiatives have been attempted every other year for decades and always failed.

OKLAHOMA
A special House committee will study whether the Choctaw Nation's compacted off-track betting is hurting the industry. In Feb. 1998, voters resoundingly defeated a casino initiative, after the sponsor withdrew. A proposal for a State Lottery has come from a formerly anti-lottery state senator, who looked at the Nov. 1998 election results from Alabama and South Carolina. In 1996, voters failed to approve a State Lottery, only the second time this century: Oklahoma Gov. David Walters' pro-lottery forces had been far out-spent by horse-racing interests. A federal Court of Appeals ordered the state to negotiate for tribal Class III gambling, but the case was dismissed following Seminole. Opponents claim a bill to allow charity raffles may accidentally re-open the door for Indian casinos. The Quapaw Tribe is about the open the largest all-electronic bingo hall in North America, 800 seats, in Miami, Oklahoma, according to e-BingoNews.

!* OREGON
The State Lottery runs almost 8,900 video poker machines, maximum of five per location; the State Supreme Court held these do not constitute "casinos." Indian tribes have full casinos. Anti-gaming forces, led by the Rev. Tom Grey, are collecting signatures to get a referendum on the November 2000 general election ballot to outlaw video poker; whether this would lead to the closure of tribal casinos is unclear. Charities can run casino nights. The State Lottery takes bets on professional sports events.

PENNSYLVANIA
Leaders of the House and Senate want to call a non-binding referendum on whether tracks may have slots, eight months after the Senate declared it would be unconstitutional to have a referendum on the question of riverboat casinos and slots at bars and tracks. Although only a court has the power to decide whether something is constitutional, politically, casinos are a dead issue, until at least the end of Gov. Tom Ridge's term in 2003.

* RHODE ISLAND
A heated dispute over a potential (non-IGRA) Indian casino is raging. In June 2000 the State House Finance Committee voted to not put the proposal on the November ballot. Sen. John Chaffee pushed a bill through the U.S. Senate requiring statewide voter approval, but the Legislature seems opposed to putting it on the ballot. In June 1999, the Narragansett Tribe won 2 to 1 in economically depressed West Warwick. The state runs 1,628 VLTs at Newport Grand Jai Alai and Lincoln Greyhound Park. The Lottery Commission voted 5-4 to give them 850 more, to compete with Connecticut's Indian casinos. Lincoln Greyhound Park alone will soon have 1,550. Gov. Lincoln Almond filed suit and first won and then lost court orders against the machines. Gov. Almond's main argument, that the Commission is dominated by Legislators, was undercut by a recent State Supreme Court opinion.

SOUTH CAROLINA
The state's 14 year experiment with video poker ended at 12:01 a.m. on July 1, 2000. A month later, the State Supreme Court held a law preventing the now non-existent slot machines from advertising was unconstitutional. At its height, South Carolina had 34,000 devices (Nevada has only 17,922 slots outside of casinos) attracting more than $2.1 billion in wagers, for $610 million profits. The Legislature had passed a bill closing down the slots unless approved at a Nov. 1999 referendum. In Oct. 2000, the State Supreme Court threw out the referendum but upheld the shutdown. In other decisions, the State Supreme Court ruled video poker is not a lottery and anyone may sue if a gambler loses $50 or more; a federal court upheld $125-a-day maximum payouts and a state trial judge enjoined a law that would have prevented beer and wine sales. Voters in 30 of 46 counties approved cash payouts in 1996. In July 1999, the U.S. 4th Circuit ruled state laws apply to cruises-to-nowhere. In Oct. 1999 a state trial judge agreed, but held no such laws are presently on the books. Bills to kill the casino ships have passed the House but get killed in the Senate. Jim Hodges beat Republican incumbent Gov. David Beasley in Nov. 1998, by supporting a State Lottery and by not opposing video poker. The Legislature will probably put a referendum to establish a State Lottery on the ballot for the Nov. 2000 election, and it will probably pass.

!* SOUTH DAKOTA
One city alone, Deadwood, has legal casinos (93 at present) and there are ten more on Indian reservations. All have true slots and table games with $5 maximum bets. The State Lottery's 7,959 VLTs were declared unconstitutional by the State Supreme Court in June 1994, but voters reinstated the gaming devices by amending the state Constitution in the Nov. 1994 election. Enough signatures were gathered to put a proposed constitutional amendment on the Nov. 2000 ballot; the third time voters will decide whether to get rid of VLTs.

TENNESSEE
Lots of talk--even long-time gambling foe Gov. Don Sundquist might be coming around, but no chance of casinos or even a lottery without a constitutional amendment. That means 2002, at the earliest.

TEXAS
The State Attorney General has sued to close the Ysleta del Sur Pueblo's Speaking Rock casino near El Paso; a Fifth Circuit opinion left the scope of gaming unresolved. The Kickapoos recently lost a case over gaming devices. A Texas AG ruled the Legislature could not authorize commercial casinos without a constitutional amendment. Presidential candidate Gov. George W. Bush has been unsuccessful in trying to kill eight-liners -- the Senate even voted to let the slots give bingo card prizes at bingo halls and parimutuel betting tickets at tracks. In July 1999, Lone Star Park joined tracks in Kentucky and California in allowing drive-through betting windows.

VERMONT
A bill to allow casinos on railroads didn't leave the station. A racetrack in the southern part of the state is campaigning hard for slot machines and a bill to allow full casinos is pending.

VIRGINIA
In 1994, a riverboat casino bill sank under the weight of excess baggage, when Disney's proposed historic theme park got tacked on. The bills were reintroduced in 1995, for the third time, and were again defeated. Recent proposals to bring race tracks to northern Virginia were attacked by state legislators as "gambling parlors masquerading as legitimate businesses."

!* WASHINGTON
Twenty tribes have casinos, supposedly without slots. (IGRA grandfathered-in one with true slots). The tribes sued the state, but the Ninth Circuit dismissed the suit after the U.S. Supreme Court's Seminole decision. Voters turned down proposals for tribal slots in 1995 and 1996. But the tribes have them now anyway, in the form of video lottery machines, a.k.a. "cashless slots," and video bingo machines. In an attempt to level the playing field, the Legislature allowed privately owned cardrooms to have house-banked blackjack. There are now more than 40 mini-casinos; Gov. Gary Locke supports bills to limit their growth.

* WEST VIRGINIA
The Legislature passed the unique "Limited Gaming Facility Act" and on Nov. 7, 2000, Greenbrier County voters will decide whether Greenbrier Resort may open a casino, open only to registered overnight guests of the hotel. Four tracks (2 greyhound and 2 thoroughbred) have VLTs; the law prevents any newly-built track from having gaming devices. Jefferson County voted in Nov. 1996 to permit VLTs at Charles Town Races; the voters had turned the track down in 1994. Gov. Cecil Underwood let a bill become law without his signature, allowing VLTs to accept coins. Bills to allow statewide VLTs (as in South Dakota) died in the 1999 legislative session; passed the Senate in 2000, but was tabled in the House. A third try will come in 2001.

!* WISCONSIN
Sixteen tribal casinos have slots, fifteen also have blackjack. The original compacts began expiring in 1998, but were mostly renewed when tribes agreed to raise the gambling age to 21 and the state's share from $400,000 to $20 million a year. The legislature voted in 1993 to prohibit further casino expansion, but proposals still pop up. Three Chippewa bands are suing the Department of Interior for rejecting plans for a casino at the bankrupt Hudson dog track. On Jan 5, 2000 Gov. Tommy Thompson signed a law lowering the punishment for a tavern caught with five or fewer video gambling machines to a $500 fine misdemeanor.

WYOMING
An initiative to allow full casinos was defeated by a two-to-one margin in Nov. 1994. The electoral defeat meant fewer jobs for lawyers: The initiative was so poorly written that it was unclear whether bets would have been limited to $25 maximum or whether there would have been no limits. State law allows limited sports betting.

American Possessions:

AMERICAN SOMOA
Proposals for a land-based casino and cruise ship gaming are being considered by the Legislature.

DISTRICT OF COLUMBIA
Riverboat casino initiative failed to get enough legitimate signatures: Of 45,000 signatures gathered, fewer than 15,000 were from voters. "Monte Carlo" nights for charities are a growing concern.

!* COMMONWEALTH OF THE NORTHERN MARIANAS
Casinos with slots.

* GUAM
Gaming devices are legal. In Nov. 1996, an initiative to allow full casinos to compete with those on the nearby island of Saipan in the Northern Marianas was defeated at the polls.

!* PUERTO RICO
Full casinos with a strange twist: The government used to own the slot machines. A movement to privatize developed in 1996.

!* VIRGIN ISLANDS
Local voters approved the concept of legalized casinos in a non-binding referendum in Nov. 1994. Legislation for casinos has been approved, and the first license issued for a land-based casino in St. Croix. The Legislature recently voted to allow cruise ships calling in St. Thomas to keep their casinos open while in port, provided the ship remains docked beyond 6 p.m.

Status of Gaming Enabling Laws (Continued) is republished from iGamingNews.com.
Articles in this Series
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:

Compulsive Gambling and the Law

> 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:

Gambling and the Law

> More Books By I. Nelson Rose