As administrative rules for the upcoming electronic pull tabs are taking shape in North Dakota, gambling operators are still cautious about the new form of gambling that would spread in charitable gaming operations by the end of the summer. The new electronic games, allowed during the 2017 legislative session, have seen rapid growth in neighboring Minnesota, but it is unclear what revenue they would bring to the Peace Garden State.
Last year, North Dakota legislators did not allow casinos outside tribal reservations and wagering on historic horse racing. The push for expanded gambling did not fail completely, however, as lawmakers decided to legalize the electronic form of paper pull tabs, already available across the state. The rules and regulations regarding the new type of game are still being developed by the Attorney General’s office, but it is certain that they would be offered as a form of charitable gaming and that there will be a cap on the number of games allowed at venues. Once regulations are drafted, they will be reviewed and enacted on June 11 at the meeting of the Administrative Rules Committee of the North Dakota Legislature.
Some local gaming operators have expressed uncertainty over the feasibility and profitability of the new games. Dennis Rexin, manager of the Knights of Columbus Hall in Jamestown, told The Jamestown Sun that whether electronic pull tabs would be successful or not would depend on the finalized rules. Another operator, Progress Enterprises, which manages four gaming facilities in the region, pointed out that they did not even know how the new machines would look like. The Gaming Commission has already passed rules permitting up to 5 electronic pull tabs in one facility. It is also certain that they will be available only in bars but not in clubs, which according to some is a bit confusing.
Lawmakers themselves seem to disagree on the nature of electronic pull tabs, which were legalized by House Bill 1216. According to Rep. Andy Maragos, R-Minot, who sponsored the bill, they are only a minor expansion of the gaming offerings in the state. He believes that as a merely a new form of a game that is already available in the state, electronic pull tabs should be limited to 10 per gaming facility. Attorney General Wayne Stenehjem, on the other hand, plans to limit them to 5 in every establishment because some businesses want to place dozens of these games on their premises. And this, he says, would allow them to effectively operate like casinos.
What Are Electronic Pull Tabs?
The legislation allowing electronic pull tabs in North Dakota permits electronic machines, which display images similar to the traditional paper pull tabs. The player then touches the screen and the image “opens” to reveal a combination of symbols and possibly winnings, paid out by a bartender or operator. Attorney General Wayne Stenehjem compared the games with slot machines, saying the two are quite similar. But Janelle Mitzel, president of the Charitable Gaming Association of North Dakota, commented that while slots were random, electronic pull tabs had a “finite prize structure”. She believes that the new games would supplement the current charitable gaming offerings in the state.
According to statistical data for North Dakota, charities collected $37.1 million in gross proceeds from paper pull tabs sales in the last three months ending December 31, 2017. In Minnesota, where the electronic version of the game was introduced in 2012, sales from this new form of gambling reached $201 million in the fiscal 2017 year. Revenues are expected to grow to more than $385 million in the current fiscal year, says Gary Danger, compliance officer for the Minnesota Gambling Control Board. While in Minnesota, the cap on electronic pull tabs depends on the size of the gaming venue, the limit in North Dakota seems too restrictive, Dennis Rexin believes, adding that it makes little sense that the games would be allowed only in bars and not clubs or some other establishments.
