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Montana Department of Justice  ·  Gaming Regulation

Gaming Advisory Council Meeting Minutes

July 13, 2001
Scott Hart Auditorium
Helena, Montana

Please note: This is a summary of the Council meeting. The meeting in its entirety is on tape at the Gambling Control Division office at 2550 Prospect Avenue, Helena, Montana. Exhibits are on file in the office of the Gambling Control Division.

COUNCIL MEMBERS PRESENT

Senator Dale Mahlum
Representative John Witt
John Tooke
Tim Carson
Steve Morris
S. Kevin Howlett
Tom Scott
Bill Thomas

DIVISION STAFF PRESENT

Gene Huntington, Ben Kamerzel, Rick Ask, Julie Burch

SUMMARY OF COUNCIL ACTION

CALL TO ORDER AND ROLL CALL

Chairman, Senator Dale Mahlum called the meeting to order and took roll call at approximately 10:00 a.m. All members were present except Randall Gray. The Council voted unanimously to accept the minutes from the April 20th meeting as amended.

DIVISION REPORT, GENE HUNTINGTON, DIVISION ADMINISTRATOR

Gene Huntington, Gambling Control Division Administrator, addressed the Council and gave them a brief update on the status of the Automated Accounting and Reporting System (AARS). Mr. Huntington told the Council that the department had given Lodging and Gaming Systems, Inc. (LGS), notice that they were in breech of contract on April 26th 2001. He continued, they were allowed another 30 days, under the agreement to cure the breech of the contract and as of June 5th they hadn't delivered anything and the department terminated the agreement. He further stated that on that date, LGS had filed suit against Montana. Mr. Huntington told the Council that the department was in the process of filing suit to recover money paid to LGS along with other expenses and damages.

The Council discussed some different alternatives and situations that may arise due to the dilemma with the LGS contract.

ATTORNEY GENERAL, MIKE MCGRATH

Montana Attorney General, Mike McGrath, addressed the Council and thanked them for all their assistance in advising on a variety of issues. He briefly discussed the suit with LGS and then, entertained questions from the Council.

LEGISLATIVE AUDITOR REPORT

Joe Murray, Legislative Auditor, addressed the Council and gave them a brief overview of the audit that he and another Legislative Auditor, Lisa Blandford, had been assigned to work on by the legislative audit committee. The audit was to be performed on the on- premise liquor licensing procedure. Mr. Murray told the Council that there were basically three objectives they wanted to meet in their review; to provide the legislative committee with information on how the process works; to determine whether the liquor licensing process was timely and efficient and, to find out if it may be possible for the licensing process to be expedited.

Mr. Murray told the Council that since the report had not been discussed with the Department of Revenue, Gambling Control Division or the Audit Committee, he could not disclose the findings. He agreed to send the Council a copy of the final report once it is published and to attend the next Gaming Advisory Council meeting.

SUBCOMMITTE REPORT

At the April 20, 2001 Gaming Advisory Council meeting, council members Tim Carson and Tom Scott had been assigned as a subcommittee,to recommend a format for a report for the release of a report of machine profitability by manufacturer model. The subcommittee made three recommendations to the Division:

  1. Two reports should be made available: a report for establishments with 2-19 machines and a report for establishments with 20 machines;
  2. The Division should charge a fee for information requests that vary substantially from the recommended formats, and
  3. The reports should carry a disclaimer, which states that the Division does not represent that, the manufacturer and the model of the machine is a significant variable in the profitability of the machine.

PROPOSED RULE CHANGES

Administrator, Gene Huntington explained that the following discussion of rules relating to promotional games was the first attempt to discuss several changes in rules requested by the Gaming Industry Association (GIA). Mr. Huntington further explained that this was the proposed method for working through the areas requested by the GIA. As a result of the "issue paper" and the presentations at the meeting the Gaming Advisory Council could take action or assign the subject to a subcommittee for further consideration.

Rich Miller, Executive Director for the Gaming Industry Association, made a presentation on the rules that the GIA would like reviewed, which were set out in a letter he had provided to the Division. Mr. Miller then explained the difficulties that the GIA and operators have experienced with restrictions regarding promotional games and devices. Of concern was the requirement that devices could not be approved if the devices had ever been used for gambling in another jurisdiction, even though there was no intent to use the device for gambling in Montana.

Chairman Mahlum invited representatives from Fisher Broadcasting and the Montana Broadcasters Association to present their views. Mr. Chad Parish, Missoula, and Mr. Gregory McDonald, President, Montana Broadcasters Association, explained difficulties that radio stations had experienced in understanding the rules and questioned the consistency with which rules are applied. Mike Fanning, Assistant Attorney General, assigned to the Gambling Control Division, gave a presentation on the history and structure of the statute and rules relating to promotional games and devices.

After discussion by the Council, Chairman Mahlum appointed a subcommittee consisting of the following Council members:

Representative John Witt, Chair
Tim Carson
Tom Scott
Kevin Howlett

Chairman Mahlum asked that additional private sector input be solicited concerning rules related to promotional games.

The Council agreed to continue to use this format for the discussion of further changes to Gambling Control Division rules.

NEXT MEETING

The Council tentatively scheduled the next meeting to be held the 21st or possibly, the 28th of September, depending on when the Legislative Auditor's report is published.

Meeting adjourned at 2:30 p.m.