The evolution of gaming in Montana
Pub Date: 1/1/2003
Native Americans who lived in Montana for thousands of years were known to take great pleasure in games of chance. With the arrival of the first fur traders, then miners and finally the stockmen, new forms of gambling were introduced including cards, dice and lotteries.
When the Montana Territory became a state and adopted its first Constitution in 1889, all gambling was officially illegal, though gambling halls continued to thrive rather openly.
Gambling continued for nearly 100 years following its constitutional ban, operating somewhat below ground, out-of-sight or even out in the open where an accepting public simply averted its eyes. Gambling enforcement was spotty at best and operated in a broad "grey area."
Bona fide slot machines were a common site in the state's saloons and visitors marveled at how freely silver dollars, needed to play the slots, circulated through the community.
Over the years, various law enforcement authorities of varying zealotry periodically "cracked down" on illegal and grey area gambling. The most notorious such actions occurred under Atty. Gen. Arnold Olson in 1949 and later, again, under Atty. Gen. Robert "Bingo Bob" Woodahl, who was known for raiding bingo games in church basements.
Some speculate Woodahl's making criminals of "little old ladies in tennis shoes" helped spur the inclusion in the newly adopted 1972 Constitution of a provision to allow the Legislature to determine what gambling would be allowed.
Shortly thereafter, the legislature declared some card games, bingo, raffles and sports pools or "boards" to be legal, under certain rules and conditions.
The game of keno, introduced to the nation in Butte, Montana, by the Chinese who emigrated there, was found by Montana courts to be simply a variation of bingo and therefore legal.
The courts also ruled that electronic forms of legal live games were fundamentally the same and, so electronic keno machines became legal. However, in 1984 the courts ruled electronic poker machines were a form of illegal "slot" machines, so the Legislature in 1985 passed a law legalizing video poker while limiting liquor licensees to five poker machines and establishing license fees. There were as yet no limit on the number of keno machines. In 1986, 2,887 permits were issued for poker machines.
Gambling regulation was becoming increasingly codified in state statute, but spotty interpretation and enforcement of gambling laws and practices, varying vastly from county-to-county, was becoming problematic for the public and law enforcement. Thus, further moves to centralize gambling regulation were undertaken.
Just after voters approved a state lottery in 1986, a 15 percent tax on gaming machine gross revenues was levied and collection was left to the Department of Commerce, with two-thirds of the money designated for local government and the balance for state government.
1989 was a watershed year for gambling in Montana. It's hodge-podge of laws, rules, regulations and enforcement practices were firmly codified and centralized under the Department of Justice.
Only holders of liquor licenses are allowed to operate gambling. In Montana, only residents are allowed to own liquor licenses so, by default, only residents can operate gambling enterprises. The investigatory process to acquire either license is extremely vigorous.
In 1991, the state established that a maximum of 20 machines in any combination are allowed to operate under a license. Maximum wagers are $2 and maximum payouts on keno were set at $800 and at $100 for poker machines (later updated to $800).
And the system has remained essentially unchanged since then.
Sources: Montana Department of Justice Gambling Control Division web site '; Special Reports I, published and distributed to 180,000 households state-wide, winter 2001, and Special Reports II, published and distributed to 180,000 households state-wide, winter 2002 by Continental Communications, 125 W. Granite St., Suite 102, Butte, MT 59701.