Gambling the North Dakota Way : Legal Wagering Eases the Costly Burden of Government

“Gambling isn’t hurting anyone in town. Gackle isn’t becoming another Las Vegas,” insisted the Rev. Charles Kurtz, 45, president of the Gackle Ministerial Assn.

Gambling in Gackle (pop. 456) takes place all year at two local taverns where patrons pay 50 cents and $1 to try their luck at pull tabs (paper equivalents of slot machines). Top prize is $50.

All proceeds from gaming in Gackle go to the Gackle Park Board--$3,458.15 in 1984.

“Thanks to gambling, for the first time in the history of Gackle we had a recreation director last summer,” said Cece McBurnett, 31, mother of two children and teller at the local bank.

She’s one of three members of the Gackle Gaming Board and secretary-treasurer of the local park board. Vicki Fey, 22, Gackle’s Avon lady, is bookkeeper for the gaming board. Beautician Nona Miller, 23, is responsible for lining up townswomen to serve as pull tab clerks.

This summer the Gackle Park Board is going to hire a recreation director again and build a new baseball diamond and stands with its gambling money.

“If gambling was taking food and shelter from Gackle families, I’d preach against it,” said Kurtz, pastor of the 1st United Church of Christ. “But it isn’t. It’s doing good.

“We have six churches in town. Our ministerial association as a group has a lot of power in Gackle. We could stop the gambling. But we see no reason to interfere with it.”

Gambling North Dakota style is unlike gaming anywhere else in America.

Charities and certain eligible public agencies are the only organizations permitted to operate and benefit from gaming enterprises.

“Gambling saved the station from going under,” said Jim Rockey, 45, the station’s gaming director, a former university professor who at one time was a fund-raiser for the Republican National Committee.

“When we first decided to go into gaming to raise funds to keep the station on the air there was some concern by the board of directors that we might lose members (subscribers),” recalled Rockey. “Over the last three years we have only 53 documented cases from our 22,000 members who decided not to renew because of gaming. . . .

“Gambling in North Dakota brings out the best in people. Quite often gamblers will win at blackjack or at pull tab counters and donate their winnings to the charitable organization running the game. Can you imagine someone in Las Vegas donating his winnings to the house?”

Gambling paid for Olympic middleweight silver medalist Virgil Hill’s training and trip to Los Angeles last summer. Hill, 21, came out of the Williston Boxing Club, an organization sponsored by gaming in the North Dakota town.

When a dozen members of the Grand Forks Handicap Club flew to Washington last summer and attended the annual conference of the President’s Committee on Employment of the Handicapped, their trip was paid for by gaming.

“Our club is financed by a $50,000 grant each year from gambling. We had very little funding in the past. Gaming has opened up a whole new world for our group,” said Georgene Emard, 61, president of the club the past 19 years, and an arthritis victim.

Beneficiaries Are Everywhere

Beneficiaries of charitable gaming are encountered everywhere in North Dakota. In Beulah, Cheryl Skalsky, 40, runs the Mercer County Women’s Action and Resource Center and supervises the center’s seven gambling sites.

“Before gaming we were desperate for funds. We operated on a $5,000-a-year State Health Department grant. Last year we received $80,000 from gaming. We have several ongoing programs to care for people in need and in stressful situations in our county,” explained Skalsky.

Osnabrock, pop. 200, about 22 miles south of the Canadian border, has a new firehouse thanks to gambling.

The gambling takes place in Tom’s Bar next to the fire station. Tom is Tom Twaddle, 41, assistant fire chief for the all-volunteer fire department.

By law no one working for an establishment having gambling can participate in the operation in any way, not as a dealer, seller or player. When anyone at Tom’s Bar wants to gamble, a firefighter is summoned to run the game. Twaddle cannot deal or bet in his bar.

In the three years gaming has been going on in Osnabrock, nearly $20,000 in proceeds have come from gambling, enough to purchase building materials for a new firehouse.

Built It Themselves

Osnabrock firefighters built their new fire station themselves in their free time. It’s valued in excess of $50,000. It has plenty of space for the town’s 1948 and 1964 fire trucks and a meeting room for the fire fighters.

Gambling in the state is regulated by the Attorney General’s Office. Assistant Atty. Gen. John Jacobson, 37, is director of the gaming division. Charles Keller, 33, is chief of accounting.

“Every gaming operation is licensed and the charitable organization must file quarterly reports and annual income tax returns,” explained Keller. “All the information is computerized. We flag discrepancies if someone is operating out of range.

“There are strict rules and regulations. Organizations are limited to no more than 35% of adjusted gross proceeds for expenses. Each charitable organization must run its own gambling operation, hire dealers, buy the equipment.”

Gambling is an attractive asset for hotels, motels and bars. It brings in traffic, increases business. But the only money made from the actual gambling by site owners is the ability to charge $150 a month for rental of space for each blackjack table.

Nicholas Spaeth, 35, became North Dakota’s attorney general in January. He has gone on record favoring an independent gaming commission.

“My feeling is that supervision of gambling is not the function of the attorney general’s office,” explained Spaeth. “I believe an independent gaming commission could do better in the Legislature in getting sufficient funding to police gambling. The 5% gaming tax was intended to go exclusively toward regulation of gambling, but budget problems have deferred much of the money to other programs. . . . Cities have bought police cars, for example, with the gambling tax money. Because it’s a cash business theft is easy unless gaming is closely monitored.”

No Organized Crime

The attorney general, the governor and other state officials contend that organized crime is not involved in gaming in North Dakota. “The Mafia is not skimming North Dakota gambling money,” said Spaeth.

“Gambling in this state isn’t lucrative enough to attract organized crime. Since it is controlled by charities there is little opportunity for organized crime to infiltrate the system.”

Charitable organizations monitoring gaming activity have in a few instances uncovered in-house thievery. The assistant gaming director of Prairie Public Television several months ago absconded with $35,000. He is now in prison.

“It was egg on our face,” said Jim Rockey, the TV station’s gaming director. “Even though we thought we had the best of internal control systems, we are still dealing with people. Any time people have access to cash the temptation is there.

“Charities have vested interests in gaming money and try to protect it as much as possible. This is a small state. People know one another. In gaming if anybody comes in and rips off the organization, it is like stealing from your next door neighbor.”