U. S. District Judge Colleen Kollar-Kotelly recently denied a motion by the U. S. Department of Justice to dismiss a lawsuit by the city of Duluth, paving the way for city attorneys to argue that the National Indian Gaming Commission should not have terminated the revenue-sharing agreement between Duluth and the Fond du Lac tribe’s Fond du Luth Casino.
Before the tribe stopped making payments, the city had received 19 percent of the proceeds from the casino’s video slot machines. As a result of the ruling, Duluth could receive back payments of nearly six million dollars a year, to be used for street repairs and other city improvements.
Duluth City Attorney Gunnar Johnson stated, “As part of that agreement, both parties were to benefit, now because of the actions of the National Indian Gaming Commission, one party is benefitting, and one party has the burden.” Johnson said the Department of Justice is expected to file an answer to the city’s complaint, then the case will go to trial.
Also in Minnesota, the state lottery—which sells tickets through ATMs and gas pumps–soon will offer computer-based scratch-off tickets. Ed Van Petten, executive director of the Minnesota State Lottery, said, “I fully understand the fear that the internet is the boogeyman and all that. Online sales are a very minuscule portion of our business. I don’t expect it to be a great sales generator for us. I just expect it to be a great marketing tool.”
Last year online gambling accounted for less than 1 percent of the state’s $560 million lottery sales.
In the last six years, overall lottery revenue has increased each year. About 45,000 Minnesotans have signed up for online accounts. However, only 29 percent of residents age 18-24 play the lottery, compared to 52 percent 10 years ago. “The lottery is just not on their radar,” Van Petten said.
The online lottery scratch-off tickets will be digital replicas of the actual paper lottery tickets now sold at retailers. Online players can bet up to $50 a week, and problem gamblers can block themselves from the site. The lottery site also offers a “cooling-off period,” which delays a request for a limit increase to discourage excessive betting. Players’ age and location are checked through lottery technology.
Some convenience store operators, after making significant investments in lottery equipment, feel threatened by online ticket sales. Mark Ogren, owner of Croix Oil Company, which owns numerous metro area convenience stores, said, “This is a very big step, and I don’t think we need to do this. The lottery is already readily available for anybody who wants to play, and they don’t need to go online.”
Lottery officials notify lawmakers about new offerings and activities but Van Petten said the changes do not require legislative approval—much to the concern of several legislators. State Rep. Greg Davids, a gambling opponent, said, “It’s horrifying. We have the lottery gone wild. I am very concerned about where this lottery is heading.” Davids’ colleagues agreed. State Rep. Dan Schoen said, “It’s certainly a firestorm. We’ve got to fix something.”
State Rep. Kathy Lohmer stated, “To do something this major and drastic, in the darkness of night, without any kind of oversight is just wrong. It’s an addiction for some people, and the earlier you get into it, the more likely that addiction is going to happen. It just seems like in government, we are always trying to find ways to raise more money.”
Still, online gambling is not going away, lottery officials said. “That horse has left the barn, and that horse left a long time ago,” said Lottery Research and Planning Director Don Feeney.
