BISMARCK-Charity officials and a tribal chairman who rely on gaming revenue testified Monday against a resolution that could open the door to state-owned casinos in North Dakota, which one opponent said would result in an "explosion" of gambling in the state.
At issue was House Concurrent Resolution 3033, introduced by House Majority Leader Al Carlson, R-Fargo. The resolution, if approved by voters in next year's primary election, would amend the state Constitution to allow the Legislature to authorize up to six state-owned casinos.
The facilities couldn't be located within five miles of a city with a population exceeding 5,000 or within 20 miles of a Native American reservation.
The resolution says the casinos "must be established as a destination-oriented attraction selected for the scenic, historic, recreational and tourism advantages of the site" and its "potential to contribute to the rural economic development of the state."
"Is this going to get rid of all our other taxes? Absolutely not," Carlson said. "Is it going to boost some of our rural communities? I think it does."
The House Judiciary Committee did not immediately act on the resolution after the hearing March 13, which lasted almost two hours.
Carlson was peppered with questions about the facilities' location, how local governments would pay for any additional costs and why the casinos needed to be state-owned. On the latter question, Carlson doubted developers would open a casino in a rural area, and bill cosponsor Sen. Lonnie Laffen, R-Grand Forks, cited unspecified issues and "bad actors" in the casino business.
"We are not Las Vegas," Carlson said. "We need to have a very controlled environment if we're going to do this."
The idea faced opposition from Mark Fox, chairman of the Three Affiliated Tribes, who warned adding casinos would upset an "equilibrium" and saturate the market.
Casinos are allowed on tribal land in North Dakota through federal law, and Fox said the revenues it uses for various services would be "greatly diminished" if the state opened its own gaming facilities. He also pointed to the hundreds of jobs that each site provides.
"You will gain revenue, but it's not without cost and it's not without loss," Fox told lawmakers. "And you're going to find our reservations still struggling hard to try to establish themselves, and that one vehicle that has helped pull us out of that is now going to be reversed and diminished."
Ruth Buffalo, a member of the Three Affiliated Tribes and the Democratic-NPL Party's candidate for insurance commissioner last year, emphasized the need for improving state-tribal relations in the wake of the protests against the Dakota Access Pipeline.
"I agree it's a two-way street, but this proposal is very one-sided," she said.
Carlson said his resolution isn't a retaliatory measure against the tribes for disruptions caused by the monthslong protests.
A handful of people representing nonprofit organizations also testified against the measure. While the Constitution prevents the Legislature from authorizing "any game of chance, lottery or gift enterprises," it makes exceptions for a multi-state lottery and charitable gaming.
Jonathan Jorgensen, president of the Charitable Gaming Association of North Dakota, said state-owned casinos would take away funds from charities.
"For years, gaming expansion has been fought," Jorgensen said. "This is not an expansion of gaming. This is an explosion of gaming."
The resolution would create a seven-member Casino Gaming Commission with members appointed by the governor, state auditor, attorney general and legislative leaders from both parties. Republican Gov. Doug Burgum expressed skepticism about the concept in an interview last week, particularly about the potential to create more state employees.
"The whole concept is odd to me," he said. "If you think that gaming is great for North Dakota's economy, which is a separate question, ... then why would the state be doing it?"
But Carlson submitted an amendment Monday that would require the Casino Gaming Commission to contract with a private entity for leasing facilities and managing the casinos. His amendment also specifies that 70 percent of net profits from casino operations must be transferred to the Tax Relief Fund, while 30 percent must be sent to the Community Health Trust Fund.
Laffen argued lawmakers need to be proactive because the idea will likely come up through an initiated measure, although Jorgensen said he wasn't aware of any grassroots effort to push state-owned casinos.
"I don't believe in gaming. I don't gamble," Laffen said. "I want us to be able to control the details."