North Dakota Senate kills bill tying electronic pull tab machines to on-sale liquor licenses
Several bills regulating the state's rapidly growing number of electronic pull tab machines are still under consideration.
BISMARCK — North Dakota lawmakers are steering toward a study of the state's charitable gambling issues, including the proliferation and siting of electronic pull tab machines.
The 2017 Legislature approved the glitzy devices, which appeared in 2018. They quickly became a common sight in bars. Gov. Doug Burgum has called them “functionally slot machines."
Recently, a loose interpretation of an "alcoholic beverage establishment" led to the machines appearing in a handful of places such as gas stations and convenience stores. Cities and counties authorize gambling in their jurisdictions, including the machines and where they go.
The state's top gambling regulator is awaiting clarification on e-tabs so her office can regulate their activity correctly.
One bill that opponents called an expansion of the machines failed Friday, March 31.
The Senate killed House Bill 1484 by Rep. Nathan Toman, R-Mandan, in a 6-38 vote with no debate. The state House of Representatives last month had passed the bill, 66-27.
The bill sought to require locations with the machines to have an on-sale liquor license approved by the local government.
"This could include coffee shops, hair salons, gas stations, grocery stores or a site the local governing body allows," Sen. Judy Estenson, R-Warwick, told the Senate.
The bill also aimed to give sole discretion for approving machine sites to city and county boards, removing the state attorney general's authority for "final approval," instead mandating the attorney general to issue a license that a local government approves.
Estenson said the Senate Judiciary Committee was "concerned about the lack of uniformity without the AG oversight" as well as "local concerns that have been expressed that there are problems happening within the local control of this increased gambling."
The siting issue isn't dead. Senate Bill 2304 by Sen. Jerry Klein, R-Fessenden, would mirror new rules by the state Gaming Commission that alter the definition of a bar to clarify that it does not include off-sale liquor stores, gas stations, grocery stores or convenience stores, but allows bars in hotels, bowling alleys and restaurants.
The rule change last year was "for the future in case nothing happens during this legislative session," state Director of Gaming Deb McDaniel has said.
North Dakota has 4,400 electronic pull tab machines in more than 800 sites statewide.
Klein's bill is set for a hearing Monday before the House Industry, Business and Labor Committee. The Senate passed the bill, 35-12.
Klein has called the machines' appearance in convenience stores "troubling," and cited concerns for gambling addiction, regulation and impacts on Native American tribes, whose casinos are a major part of their economies.
Charitable organizations benefit from off-reservation gambling in North Dakota. The machines generated nearly $1.6 billion in proceeds in fiscal year 2022, paying out about $1.4 billion in prizes and netting about $200 million for charitable uses.
The Senate on Thursday unanimously approved a bill that would limit the machines' proliferation during a mandatory, interim 2023-24 legislative study of issues facing North Dakota's charitable gambling.
Sen. Jonathan Sickler, R-Grand Forks, told the Senate that House Bill 1497 "represents a pause."
"The unexpected and rapid expansion has laid bare policy disagreements that need to be resolved and fundamental questions that need to be answered now before our charitable gaming industry grows even larger," Sickler said.
The Legislature has handled a bevy of bills this session related to gambling and e-tabs, including ones on siting, rent increases and regulatory control.
The bill by Rep. Keith Kempenich, R-Bowman, goes back to the House for concurrence on Senate amendments.