Should you be allowed to drop a few coins into a slot machine at your nearest convenience store? How about at the civic organization where you play bingo?
That’s the thorny question state officials have been grappling with this year, and one local legislator is leading a committee charged with coming up with answers to that question and others.
State Rep. Dan Shaul of Imperial (R-District 113) is the chair of a special House committee that has been meeting over the summer and fall with the hopes of drafting legislation that the General Assembly could consider in 2020.
“We’ve got a beehive stirred up, and we have to make sure we get the honey out of it and hope that nobody gets stung,” Shaul said.
His seven-member bipartisan committee met for the third time on Oct. 10, with two additional hearings set for
Oct. 27 and Nov. 7. In addition to the proliferation of unregulated, untaxed gaming machines that have been appearing all over the state, the group is discussing sports gambling and other related issues.
Recent estimates put the number of unregulated gaming machines at more than 14,000.
The Missouri State Highway Patrol is in charge of investigating complaints about those machines, and confirmed that it has begun looking into 73 retailers or fraternal organizations that may have the machines.
The Missouri Gaming Commission has forwarded 13 complaints about locations in Jefferson County and another two in Eureka to the highway patrol for investigation. (See list of locations.)
Many aspects to consider
Shaul said the issue of how to deal with these machines is a complicated one.
“I’ve learned a lot more than I thought I would about this,” Shaul said. “Our laws concerning these machines are still based on case law from 1913. Well, a lot has obviously changed since then. Another law that’s often cited is from 1984. A lot has changed since then, too. Our goal is to put together a law that’s relevant to what the marketplace and the technology is like today and tomorrow, that will be something that the General Assembly will be able to adopt.”
Officials with the Missouri Lottery have estimated that the renegade machines have cost it $50 million so far, which in turn reduces the amount of money the Lottery turns over to public schools and veterans’ programs.
“People who are going to gamble are going to gamble, and that’s a defined group of people,” Shaul said. “If we split it up into different legal ways to gamble, it’s only natural that the Lottery and casinos, which are regulated by the state, will likely see a decrease in revenue. So we’re at the point where we have to do something.”
The Missouri Gaming Association, which represents casino operators, has come out against legalizing slot machines outside of casinos. It noted that when Illinois legalized the off-site machines, casino revenue fell by 18 percent.
No direction for
Shaul said he’s learned that enforcement against unregulated video gaming terminals has been sporadic at best.
“What we’ve found is that because the laws regarding these machines have not changed through the years, prosecutors have largely determined not to prosecute against them,” he said. “Why not? They tell us that they feel there are more pressing issues, more pressing crimes to worry about, and that there is no outcry from the public that prosecutors and law enforcement feel that they need to go after these things. And the truth is, there hasn’t been an outcry.”
Shaul said his committee is looking at the situation from as many angles as it can.
“Whatever we come up with when our work is finished, we have to ask all concerned ‘Is that what we want?’ If you’re involved in an accident, do you want to have to wait a half an hour more for law enforcement to show up because they’re in a gas station or a bar checking out some machine?”
Shaul said the General Assembly needs to give some direction to prosecutors and law enforcement personnel.
“There’s a whole question right now of what’s legal and what’s not legal. Is it a gaming device, and how do we define what one of those is? Is it a game of chance? How exactly does one define that? Does it have to be in a casino? There was one gentleman from the Elks who spoke at the committee who was asking why his group faced prosecution for having machines because they offer bingo while a place down the street doesn’t.”
In July, the lead attorney for the Missouri Gaming Commission ruled that the terminals contain functions that make them “gambling devices,” which are prohibited outside of licensed casinos, and that allowing those machines would jeopardize the state-issued bingo licenses to civic groups such as the Elks, VFW, American Legion and Amvets.
LeAnn McCarthy, a spokeswoman for the Gaming Commission, said it has received no complaints about slot machines being allowed in locations that also offer bingo.
Recently, Missouri Lottery officials have sent letters to retailers who sell Lottery tickets that they may face prosecution if they also offer the video slot machines.
“Do they have the legal authority to do that? Is that something that they should be doing?” Shaul asked. “Those are things the committee needs to determine.”
Another facet to discussion
Shaul said it’s not as easy as a simple allow-or-ban decision.
“I’ve been approached by business people in eastern Missouri and specifically Jefferson County that whatever we come up with, make sure that we’re not putting them out of business at the expense of out-of-state conglomerates,” he said.
“There are companies out there that are making and marketing legal machines (that are considered games of skill and are not considered gambling devices, such as video poker machines) that want to make sure that they’re not crowded out by so-called ‘gray market’ machines. If these types of machines are made legal to some extent, we want to make sure that Missouri interests are protected. Whatever we do, whatever regulations we come up with, we need to ensure a free and open marketplace. We have to thread the needle on this, and be careful to figure out what is best for Missouri.”
Shaul sponsored bill last year
Shaul’s involvement with the gambling issue started last year, when he sponsored a bill that would have made video slot machines legal.
“It never got out of committee, so the House didn’t vote on it one way or the other,” he said. “I sponsored it because I think we needed to start the discussion. The Speaker of the House (Elijah Haahr, R-Springfield) came to me to chair the interim committee to continue the discussion.”
Shaul said despite sponsoring the bill last year, it doesn’t mean that he’s necessarily for making the machines legal.
“I would not say that at all,” Shaul said. “The purpose of the committee is to hear from all sides and come up with a solution that is best for Missouri. I’m not sure that any of us know what that is at this point.”
He said he and the other committee members want to submit a report to Haahr by Dec. 1.
Reporting machines to state
Those who wish to report what they believe may be an illegal gaming machine to the state can do so through the Missouri Gaming Commission’s website (mgc.dps.mo.gov).
Ed Grewach, general counsel for the Gaming Commission, said it is required by the state to provide an opportunity for the public to report machines.
“This is a valuable tool to assist local and state law enforcement,” he said. “The Missouri Gaming Commission doesn’t have the authority to regulate these devices, so we pass on all complaints to the Missouri State Highway Patrol, which will investigate them and pass their findings along to the prosecuting attorneys in each jurisdiction. We’re just the clearing house for information.”
Those who file complaints can do so anonymously.
The Gaming Commission released a list of 102 complaints around the state, some of which are duplicate locations. In general, once the patrol receives a complaint, an investigator visits the store and notes the machines in question,” said patrol spokesman Capt. John Hotz. “The patrol often works with the city or county when conducting the investigation. In cases of this nature, prosecutorial discretion is a factor. Upon completion, the investigative reports are turned over to the local prosecutor for consideration.”
To date, none of the complaints since April has resulted in a prosecution, but Platte County Prosecuting Attorney Eric Zahnd has filed suit against a Kansas-based company that supplied gambling devices in his county. That case, which stemmed from a 2018 complaint, is not expected to be settled for some time.
Shaul wants input
Meanwhile, the work of Shaul’s committee will continue.
He said the Oct. 10 hearing was noteworthy not by what was said, but what wasn’t said.
“The only thing that disappointed me (about the hearing) is that we heard from no individuals there to say that we should get these machines out of their neighborhood. People in general don’t seem very concerned about this situation.
“And I’ve yet to hear from people in Jefferson County. Do they want these machines? Do they want them to be gone? What kinds of regulations should we put on them? Too often, we hear from people after we’ve passed a law. We need to hear from people now. If not me, contact your state representative or senator.”
He said his office can be reached at 1-573-751-2504; his legislative email address is email@example.com.
“We have to be very careful that we don’t create a situation that’s worse than what we have now,” he said. “We have one chance to get it right.”