Gaming Control Board, Farrington Reach Compromise on Charitable Gaming Rules

Location: Cadillace Place, 3062 W. Grand Blvd, L-700, Detroit 
Contact:  Gary Paolella (313) 456-4178
Time:  5:00 p.m.

Gaming Control Board, Farrington reach compromise on Charitable Gaming Rules

Rep. Jeff Farrington (R-Utica), the sponsor of a bill to expand charitable gaming, and the Michigan Gaming Control Board (MGCB) today announced a compromise on MGCB's charitable gaming rules.

The MGCB proposed an administrative rules package to more tightly regulate charitable poker games-also known as "millionaire parties"-after reported poker chip sales grew from $22 million from during 2002-2004 to $530 million during 2010-2012.  The MGCB encountered numerous instances of fraud and corruption and had suspended or prohibited gaming at 20 locations since 2010.  MGCB held a public hearing on its proposed rules package on November 22, 2013.

Representative Farrington introduced HB 4960 to counter MGCB's stricter regulatory approach, expand many of the existing rules and practices regarding charitable poker, and provide for its future role as a source of revenue to charitable and non-profit groups.  The Snyder Administration opposed the bill.

According to Farrington, "Gaming Control clearly has a problem with the way some of these poker rooms are operating, and I agree that they have to do something to fix the problem.  I just think that their proposed solution went too far and would have hurt the fundraising efforts of the charitable groups that depend on the revenue from these games.  I think we have reached a fair compromise on the rules."

In return for MGCB's compromising on the rules, Rep. Farrington agreed not to seek further legislative action on HB 4960.  The major points of the compromise include:

--MGCB will allow up to 4 nights of poker each week at a location (or up to 208 nights of poker annually).  MGCB initially proposed only 30 nights of poker at a location annually and later agreed to raise that number to 120.

--MGCB will decrease the number of workers from the charitable organization who must be present to manage the game.  MGCB proposed that a minimum of 5 workers be present to manage the poker game, but the compromise called for MGCB to lower that number to 3 workers.

--MGCB will expand the locations where the games can be played.  Currently, Gaming Control permits gaming at fewer than 40 recurring locations throughout Michigan, and some large counties have only 1 or 2 places where charitable gaming is permitted.  Once the rules are in effect, MGCB can allow charitable groups to hold a millionaire party event at nearly any location in the state, including bars, churches, schools, fraternal halls, community centers, or other locations.

With the compromise, MGCB will permit additional licensed gaming suppliers (which can provide dealers, tables, and equipment) to assist the charities in running their games. Currently, only 30 suppliers are licensed to assist the charities in running these events.   MGCB will agree to immediately lift the moratorium on new suppliers issued by Lottery in January 2011.  Charities will have the choice of running the games themselves or hiring a licensed supplier to help them run the games.

According to Kalm, "Gaming has always sought to insure the integrity of these games by making the charities more accountable for their operation, and to make sure only those persons licensed provide equipment or assist charities in running their event.  These rules will still accomplish that goal. In addition, when the Rules go into effect charities will have the freedom to hold their events where they choose."

MGCB expects to complete its final rules package later this month and submit it to the legislature's Joint Committee on Administrative Rules (JCAR).  JCAR will have up to 15 session days to act on the rules.
   
Please contact MGCB Executive Director Rick Kalm at 313-456-4178 or Rep. Jeff Farrington at 517-373-7768 for any additional information.

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