US Bingo Laws Could Stiffen for NIGC
29th October, 2007
The US gambling laws vary from state to state, but with new ways of gambling emerging daily with innovative technology, gray areas are forming in regards to law-abiding. The Indian Gaming Regulatory Act if 1988, which provides a framework for legal gambling on Indian Reservations, clearly defines three classes of gambling.
Basics of the Indian Gaming Regulatory Act Class I is defined as traditional social gaming for minimal prizes. Class II is defined ‘the game of chance commonly known as bingo’, however the act specifically excludes slot machines of this game. Class III gaming is a broad category, including all games not defined in class I or class II. Casino games such as slots, blackjack, craps and roulette would fall into class III, as well as any electronic version of a class II game.
In recent years, with the development of electronic bingo ‘slot-style’ machines, many Indian gaming establishments within states where class III gaming is illegal have been able to pass of these machines as class II bingo games, while making a decent profit. However, the NIGC plans to crack down on this loophole, and clearly define rules for class II games played using electronic, computer, or other technical aids.
What the new proposal entails Under the new proposed regulations, all Indian gaming facilities would have to adhere to the following:
-make it clear to customers they are playing bingo rather than a slot machine
-slow play at the bingo machines
-allow more players to participate
-label these machines ‘bingo’
What does this mean for the industry? Specifically for Indian gaming facilities where class III bingo is illegal, these new regulations will severely hurt profits. For example, in Massachusetts, the Mashpee Wampanoag tribe stand to lose a large share of their revenue if they must alter their machines to these new standards. According to Ernie Stevens Jr., chairman of the NIGA believes the proposed rules could cost tribes as much as $1 billion annually.
“That’s devastating for the Class II industry and hurts rural tribal economies,” Stevens declared. “The most basic problem is that the new regulations arbitrarily slow down Class II games, making them less fun and less marketable.”
The Mashpee tribe is hoping Massachusetts will soon legalize class III gambling in the state, otherwise these new restrictions could put their business in danger. They model their business after the Seminoles in Florida, who last year made $1.6 billion off of their bingo machines. These new regulations would have the same effect on the Seminole tribe. Even without the new restrictions, class II gaming isn’t nearly as profitable as class III. In Connecticut, for example, where class III gaming is legal, the two casinos, Foxwoods and Mohegan Sun, brought in $2.4 billion together, compared with the $1.6 billion from eight Florida casinos.
All of these state to state restrictions are enough reason to give tribes a headache without having to deal with new regulations simply because of the advantages of technology. Still, as with many laws surrounding gambling around the world, gray areas continue to exist.
