Gambling in the United States

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Gambling, often referred to as "gaming", had 2005 gross revenues of $84.65 billion,^[1] and thrives in the United States despite being restricted.

Proponents of gambling in the United States say it provides valuable tax revenue and job opportunities. Commercial casinos provided over 354,000 jobs,^[2] and yearly state and local tax revenue of $5.2 billion as of 2006.^[3] Some community groups oppose gambling because they say it leads to corruption, compulsive gambling, and higher crime rates.

1 Authorized forms
2 Legality
3 Commercial casinos
4 Indian gaming
5 Lotteries
- 5.1 Scratchcard games
6 States where certain types of legalized gambling have been repealed
7 See also
8 References
9 External links

Authorized forms

Many levels of government have authorized multiple forms of gambling: everything from bingo games in church basements, to multi-million dollar poker tournaments. The American Gaming Association breaks gambling down into the following categories:^[1]

Card Rooms
Commercial Casinos
Charitable Games and Bingo
Indian Casinos
Legal Bookmaking
Lotteries
Pari-mutuel Wagering

Legality

Native American tribes have used legal protection (and reservation status) to open casinos. Online gambling is a more recent phenomenon.

In some states, casinos are restricted to "riverboats", large multistory barges that more often than not are permanently moored in a body of water. Other states allow casinos to be on dry land, but restrict their numbers.

Commercial casinos

Commercial casinos are casinos founded and run by private companies on non-Indian land. There are 16 states (and 1 US Territory) that currently allow commercial casinos in some form:

California
Colorado
Florida
Illinois
Indiana
Iowa
Louisiana
Michigan
Mississippi
Missouri
Nevada
New Jersey
Pennsylvania
Puerto Rico
South Dakota
Washington
West Virginia

There are approximately 450 commercial casinos, producing a gross gaming revenue of $28.93 billion in 2004.^[4]

Indian gaming

As an expression of their retained sovereignty, some Native American tribes opt to operate casinos on tribal land to provide employment and revenue for their government and their tribe members. Tribal gaming is regulated on the tribal, state, and federal level. Native tribes are required to use gambling revenue to provide for governmental operations, economic development, and the welfare of their members. Federal regulation of Indian gaming was established under the Indian Gaming Regulatory Act of 1988. Under the provisions of that law, games are divided into three distinct categories. Class I games are "traditional" games that involve little or no wagering. Class II games include bingo, pull-tabs, and certain non-banked card games (poker, cribbage, bridge, whist, etc.). Class III games include all casino games and games that do not properly fall into classes I or II.^[5]

Tribal gambling had revenues of $14.5 billion in 2002, from 354 casinos. Approximately forty percent of the 562 federally recognized tribes operate gaming establishments.^[5]

The National Indian Gaming Commission oversees Indian gaming for the federal government.

Lotteries

Lotteries are games in which contestants match their chosen set of numbers with a winning set. Most states have state-sponsored and multi-state lotteries.

The classic lottery is a drawing in which each contestant buys a combination of numbers. Each combination of numbers, or "play" is usually priced at $1. Plays are usually non-exclusive, meaning that two or more ticket holders may buy the same combination. The lottery organization then draws the winning combination of 5-8 numbers, usually from 1 to 50, using a randomized, automatic ball tumbler machine.

To win, contestants match their combinations of numbers with the drawn combination. The combination may be in any order, except in some "mega ball" lotteries, where the "mega" number for the combination must match the ball designated as the "mega ball" in the winning combination. If there are multiple winners, they split the winnings, also known as the "Jackpot". Winnings are currently subject to federal income taxes as ordinary income. Winnings can be awarded as a yearly annuity or as a lump sum, depending on lottery rules.

In some states, revenues from lotteries are designated for a specific budgetary purpose, such as education. Other states put lottery revenue into the general fund.

Some state lotteries are single-state, however most states participate in multi-state lotteries. Multi-state lotteries generally have larger jackpots due to the greater number of tickets sold. The Mega Millions, Hot Lotto, and Powerball games are the biggest multi-state lotteries in terms of numbers of participating states. Florida is the only lottery state that does not take part in a multi-state game.

Only eight states do not sell lottery tickets:

Alabama
Alaska
Arkansas
Hawaii
Mississippi
Nevada
Utah
Wyoming

Scratchcard games

Some state lotteries have games other than lotteries. Usually these are in the scratchcard format, although some states use pull-tab games. In either format, cards are sold that have opaque areas. In some games, all of the opaque material is removed to see if the contestant has won, and how much. In other scratchcard games, a contestant must pick which parts of a card to scratch, to match amounts or play another form of game.

States where certain types of legalized gambling have been repealed

On July 1, 2000 a new law took effect in the State of South Carolina where the ownership, possession and operation of a video poker machine either for commercial or even personal use became illegal. Violators are subject to prosecution and hefty fines. Currently the only type of legalized gambling in the state is the South Carolina Education Lottery.^[6]