For seventy-five years, the subject of gambling on the high seas has been a policy concern for U.S. officials. In 1926 operators anchored barges three miles off the coast of California and welcomed gamblers from San Francisco and later Los Angeles, who would take smaller speedboats from the shores to the boats. The barges were well lit and could be seen from the shores. State officials did not like the boats, but they were frustrated in attempts to enforce state anticasino laws, as the boats were considered to be in international waters. The boats could accommodate as many as 600 players, and they soon appeared off the Atlantic Coast as well.
In 1948, U.S. senator William Knowland (R, California) introduced legislation aimed at these barges. In the process he won passage of a bill that stopped all gambling on the high seas by U.S. flag-bearing ships worldwide.
The law was supposedly applied to vessels used “principally” for gambling, but in actuality, it applied to all ships whether gambling was the major activity of the ship or merely a side activity – as gambling is on most cruise ships. Gambling was prohibited on the vessels if they were registered under the laws of the United States or if they were “owned by, chartered to, or otherwise controlled” by citizens or residents or corporations of the United States. Persons violating the law could be fined up to $10,000 and jailed for two years and also could lose their vessel.
The law also made it illegal to transport passengers from the shore to a gambling ship in international waters, regardless of whether the ship was under the American flag or a foreign flag.
In 1951 (and as amended in 1962), the Johnson Act made it illegal to transport gaming equipment onto any U.S. ship. There was no change in the law until 1992. Over these intervening decades, U.S. shipping interests seemed to have suffered considerably. Although gambling activity provided only a small part of the revenues of cruise ships, the extra revenues probably helped the ships achieve overall net profits. As of 1991, there were eighty-two cruise ships that docked at U.S. ports. Only two of these were U.S. ships.
In 1992, as part of the Flower Garden Banks National Marine Sanctuary Act, Congress amended the Johnson Act to remove the prohibition on transporting gambling equipment to U.S. ships and also authorized those ships to permit gambling in international waters or in national waters if permission was granted by states. Under the new law, states could still stop such international waters gambling if the ships simply made “cruises to nowhere”. States could prohibit the gaming unless the ships docked in ports of other states or countries before they returned to the port in the state of origin.
In 1996, the federal law of gambling ships changed again. Now ships were permitted to have gambling on Lake Michigan if they were authorized to do so by the state of Indiana. Voyages to Alaska were also allowed to have gambling if they stopped twice in Alaska and also either in Canada or another state. The ability of states to prohibit the gaming was also restricted. The boats could have gambling if they returned to the original state without going to another state or country as long as the cruise was tied to a longer cruise. The new law stimulated new interest in what were referred to as “cruises to nowhere”, as these were allowed without specific state action stopping them. That state action had to be expressed in new legislation, and cruise boat interests were adept at lobbying against the restrictions.
The growth in the number of gambling ships caused the 1997–1999 National Gambling Impact Study Commission to recommend new legislation to allow states to more easily stop the “cruises to nowhere” that did not have explicit permission to operate under the state law.
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