The state of North Dakota has perhaps the widest-ranging charity gaming operations based upon casino games in the US.
Residents of the state had played many games of chance ever since statehood was achieved in 1889. Although the games were illegal, authorities were very tolerant of their existence, especially when the beneficiaries of the games were local charities. In the 1970s the operators of the games began to advertise openly, and it was clear that they were making no pretense about flouting the law.
The attorney general of the state decided to enforce the law. As he did so, he told complaining citizens that they should change the state constitution that banned all gambling. The citizens petitioned the legislature to propose an enabling amendment that would permit the legislature to govern gambling. Such an amendment became part of the state constitution with widespread citizen approval in 1976. Then a law was passed legalizing bingo, tip jars (jars filled with a fixed number of pull tabs), pull tabs, and raffles. In 1981 a law was enacted permitting charity blackjack games and poker games. Next the citizens who opposed gambling petitioned to have a vote repealing the law. They got the vote, but not the results they wanted. In 1982 a majority of 63% of the voters cast ballots in favor of blackjack.
The blackjack and poker games must be played in sites approved by local governments. The games must be conducted by nonprofit charity organizations certified by the attorney general of the state as qualifying under federal Internal Revenue Service code Section 501c criteria. Individual wagers are limited to five dollars per hand. The games are usually held in bars or restaurants, and those enterprises cannot participate in any way in running the games. They must rent their facilities to the charities at a fixed rate that does not depend upon the revenue of the gambling. The establishments may not give any food or beverages to the players, but the latter may purchase such items. The state imposes a tax ranging from 5 percent to 20% (depending upon the amount) on the charities’ gambling returns.
The charity gambling provides the most important supporting revenues for major cultural organizations such as public television, the Plains Art Museum in Fargo, and local humanity councils. The leading recipient of funds has been the North Dakota Association of the Disabled.
Until Alabama defeated the lottery in 1999, North Dakota was the only state in the twentieth century that experienced voter disapproval of a specific lottery proposal. The voters defeated lotteries three times. The leaders in the campaigns have been the charities running blackjack games.
The state does permit some pari-mutuel gaming; however, there are no major facilities in operation. There are four major Native American casinos offering machine and table games. They are at Spirit Lake, Fort Yates, New Town, and Belcourt.
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