Montana Gaming Group

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Montana's colorful gaming history

Long before the white man set foot in what today is Montana, indigenous people cast bets on horse and foot races, archery target shooting and more.

They even played a game similar in many respects to dice, using marked bones that were tossed to create random combinations which carried the potential for win or loss.

Frontier trappers and traders, too, engaged in wagering on contests of skill and chance such as racing and rifle and pistol shooting, but they also brought with them playing cards.

In fact, one young trapper, Joe Meek, is said to have witnessed a killing over a card game at a Wyoming rendezvous. The deceased was simply rolled over and his back was used as a convenient surface upon which to resume the game.

With the discovery of gold, a card game called "poker" found its way from New Orleans to the mining camps.

Yet, despite its long history and somewhat romantic beginnings, gaming has been illegal in Montana more than it has been legal.

When gaming has been illegal, it has flourished unregulated and untaxed and has imposed unfair competition on other businesses without contributing to Montana's social or economic welfare in any way, shape or form.

When it has been legalized, it has been managed by closely regulated operators and has provided Montanans with recreation, entertainment and jobs, and governments with tax revenue.

Gambling still is, and may always be, controversial. But prohibition would likely bring about a return to the days when gaming contests were in the control of shady, underworld bootleggers, that provided big, tax free profits for unscrupulous operators, just as liquor did during Prohibition. Besides, those dollars folks are going to spend gambling regardless, would then be spent out-of-state with the Montana economy the loser.

The first controversy over gaming in Montana occurred in 1862 at Gold Creek near Garrison where gold was first discovered in the Treasure State. Three unsavory characters, who dealt a game of cards similar to the old shell games, arrived and bilked some of the miners out of their gold dust.

The hustlers later were caught. One was killed after pulling a pistol on his captors, another was hanged, and the third was acquitted by a miner's court.

The incident was not forgotten when Montana's first territorial legislature met in Bannack in 1864 and immediately banned "three-card monte" as well as some other card games and dice.

But, "enactment was one matter and enforcement was another," according to historian Clark C. Spence.

In 1869, the legislature authorized local governments to begin collecting license fees from gaming. The fee was $50 a month for each table at which a game of chance was played.

Montana's original constitution, passed in 1889, contained an anti-gaming section that prohibited the legislature from authorizing "lotteries or gift enterprises" for any purpose.

Given this constitutional direction, the legislature expanded on anti-gaming laws through the turn of the century, outlawing games of chance played with cards, dice, slot machines, and wagering on contests of "speed or skill or endurance."

In 1925, the State Fair in Great Falls allowed pari-mutuel betting at its horse races without legal authority, thereby challenging the prohibition against horse racing.

The Montana Supreme Court, however, sided with the State Fair by ruling that the purse paid in horse races was a premium to the winners rather than the winnings from racing bets.

The 1937 Legislature expanded this loophole further by passing the so-called "Hickey Law" that legalized table games such as dominoes, bridge, blackjack and other card contests that were played in cigar and drug stores that paid the state an annual license fee of $10. The proceeds were marked for fraternal and charitable organizations.

Gaming was extended to fraternal, charitable and non-profit organizations in 1945 when the legislature allowed these establishments to operate slot machines. However, more than 1,400 new "non-profit" organizations soon became common areas in taverns that were roped off from the regular bar patrons. Those who wanted to enter the so-called "private club" were charged a minimal fee.

Although the private clubs were licensed by local governments, there is no indication that they paid any taxes.

The gaming prohibitionist movement reached its apex in 1947 after Montanans apparently became impatient with the way illegal gambling was flourishing under the banner of charity. By that time, almost 6,000 slot machines had been licensed by the federal government to be operated in fraternal halls and other non-profit venues.

That same year, the 23-year-old Fergus County attorney who had just graduated from the University of Montana law school, Louise Replogie, raided a night spot in Lewistown called the Joyland Club and confiscated six slot machines. Replogie now is better known to Montanans as Louise Rankin Galt, a long-time Republican party activist, who is the widow of Wellington Rankin and now is married to Jack Galt, the well-respected former president of the Montana Senate.

The Joyland Club had been one of those that had installed slot machines behind a rope under the pretense of operating a non-profit club.

"All the veteran's clubs and all the bars had non-profit clubs," Galt recalled in a 1989 interview with the Great Falls Tribune. "Everybody incorporated as a non-profit club."

The far-reaching impact of Galt's raid on the Joyland Club was that she convinced the Montana Supreme Court that it should declare slot machines as mechanical lotteries, which had been specifically banned by the constitution.

On June 30, 1950, the Supreme Court ruled that the Joyland Club was operating an illegal mechanical lottery, and thus, slot machines in Montana were banned even in "private" clubs.

This did not end gaming in Montana, however.

While the Supreme Court was considering Galt's case against Joyland, an anti-gaming crusader emerged in the person of Arnold Olsen, 31, a Democrat who had just been elected attorney general in 1948. A few months after taking office, Olsen sent a letter to county attorneys asking them to prosecute "liquor leeches, gambling gangsters and racketeers."

Olsen had received a $40,000 appropriation from the 1949 Legislature to investigate illegal slot machines and prosecute the owners.

"I campaigned to enforce the law, and gambling was involved in that," he said in an interview with the Great Falls Tribune in 1989. "I said the law shall be enforced. The saloon keepers were upset with me."

His main target was the non-profit social clubs that had installed slot machines under the loophole the legislature had authorized earlier. Olsen and his "raiders," as they were dubbed by the press, hit clubs from Butte, to Culbertson to Helena. In Helena, a judge returned all of the equipment to the Colonial Club, the predecessor of today's Colonial Inn. During a second raid, Olsen said he made sure that the equipment could not be used again.

"We broke everything," he said in the Tribune interview. "We threw some of it out of a second story window. Some of it came down the stairs. Nothing was usable."

By late 1950, Olsen had taken 20 gaming cases to court. He narrowly won his re-election race in 1952 against Wesley Castles, the Republican, and later a Montana Supreme Court justice.

Olsen was later elected to the U.S. House of Representatives and finished his career as a District Court judge in Butte.

Gaming became controversial again in the late 1960s and early 1970s when Robert L. Woodahl, Republican attorney general, began cracking down on almost every form of gaming, including bingo played in church basements. Woodahl later would describe his efforts to Charles S. Johnson, chief of the Great Falls Tribune's Capitol Bureau, as "like hitting a mound of feathers with a sledge hammer. They just flew all over. You couldn't contain it."

At about the same time, Montana's 1972 Constitutional Convention convened and placed on the ballot as a side issue whether to allow the legislature or the people to decide what forms of gaming should be allowed.

A prominent delegate, Wade Dahood of Anaconda, said, "We have a situation that makes criminals out of a large segment of our society every day. Every time someone plays a football or baseball pool, goes to a bingo game or has a friendly bet at a football game or a basketball tournament, they are actually violating the laws of the state of Montana. And let me assure you, It's only a matter of degree that they have committed a criminal act."

The constitution itself was approved by one percentage point. The side issue of whether to allow the people or the legislature to authorize gaming, was approved by 61 percent of the vote.

Woodahl, who had been nicknamed "Bingo Bob" by much of the state's media, won his re-election bid in 1972, but received only 37 percent of the vote when he ran for governor in 1976.

"The worst of it was the bingo," Woodahl later said of his anti-gaming crusade. "Little old ladies in tenny runners deluged my office. They had been playing bingo for years, and they didn't want it shut down. But it was illegal, and I had to stop it."

Woodahl had interpreted bingo as being illegal because cards were sold and prizes were awarded.

Since the new constitution was passed, bingo, raffles, poker and other card games were legalized by the legislature. In 1976, the Supreme Court legalized electronic keno, ruling that it is a form of bingo.

Poker machines were legalized in 1985, although gaming establishment owners were limited to five machines. As people's drinking habits were changing and many bars and taverns were in a life or death struggle, legal gambling was seen as a way to help keep their doors open and employees working. And it has done just that.

In 1986, Montanans, by a 69-31 percent margin, authorized the state lottery. In 1989, the legislature allowed gaming establishment operators to have up to 20 machines per location and created the beginnings of rigorous state regulation and enforcement which continues to this day.

As a legal, regulated entity, Montana licensed businesses now contribute over $50 million a year in direct gross revenue to state and local governments (they pay almost $30 million in other indirect taxes) and employ about 22,500 Montanans (2002) as well as provide a recreational diversion for Montanans and their out-of-state visitors.

Source: Special Reports I, published and distributed to 180,000 households state-wide, winter 2001 by Continental Communications, 125 W. Granite St., Suite 102, Butte, MT 59701.