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INDIANAPOLIS – Patrons at dozens of bars in Fort Wayne and throughout northeast Indiana will be able to gamble starting Tuesday under a new law legalizing some low-stakes games of chance.
Of the 200 licenses approved so far by the Indiana Alcohol and Tobacco Commission, 41 have been issued to area bars and taverns, or about 20 percent.
“I have had a lot of requests for it from my customers,” said Jamie Wright, owner of Warsaw Bowl, 1702 E. Market St. in Warsaw. “They like to gamble, and there is nowhere else to go around here.”
Wright plans to offer pull tabs, punchboards and tip boards – as well as raffles and winner-take-all drawings – in the separate bar area of her bowling alley.
“It’s not going to be a big money-maker, but it will be enough to help,” Wright said. “We hope this will be a good move.”
Bar and tavern owners like Wright pushed the Indiana General Assembly this year for the opportunity to offer the games as a way to compete with private fraternal organizations, legions and other social clubs that already are allowed under Indiana’s charity gaming laws. Electronic gaming devices, such as Cherry Masters, are still illegal in Indiana.
The new law does authorize raffles, in which tickets or chances to win a prize are sold and the bar gets to keep part of the proceeds. Winner-take-all drawings are when the establishment gets none of the proceeds.
The law also legalizes pull tabs, such as those offered by the Hoosier Lottery in grocery stores and other businesses. The front side of a pull tab shows winning combinations of symbols and prizes a player can win. The back side has windows to pull open. If the symbols underneath the pull tab match the winning combinations on the front, the player wins.
For pull tabs sold for $1, the law requires each box of pull tabs bought by the bar owner to pay out at least 75 percent.
Other gambling that could be offered under the legislation includes punchboards and tip boards. A punchboard is a card or board that contains a grid or section that hides the random opportunity to win a prize based on the results of punching a single section to reveal a symbol or prize amount.
A tip board is defined as a board, placard or other device that is marked off in a grid or columns, with each section containing a hidden number or numbers or other symbols that determine a winner.
The gambling games are not expected to be money machines for the state or the businesses but could supplement the profit margin of bars and taverns dealing with stricter drunken-driving laws and smoking bans in some areas.
“It’s probably the best thing to happen to us since (the repeal of) Prohibition,” said Don Marquardt, owner of Timbers Casual Dining and Lounge in Angola. “No other law has been passed that can benefit us so directly.”
During the last debate on the bill in the Indiana House, opponents pointed out several deficiencies in the bill, which included no limits on the number of raffles or drawings a bar could offer at one time. There is, however, a $300 prize limit on each raffle or drawing.
As a result, the Alcohol and Tobacco Commission passed emergency rules implementing the law that limit bars and taverns to one daily drawing, one weekly drawing and one monthly drawing.
“We tried to address the concerns the legislature had,” said David Heath, chairman of the commission.
One gambling activity bars cannot touch is wagering on sporting events.
During the legislative session, supporters expressed the desire to be able to offer Super Bowl, NASCAR and other sporting boards in which patrons buy squares on a grid and win money or prizes based on scores or the outcome of the event.
Nothing in the law passed by legislators prohibits this.
But the rules adopted by the ATC specifically say “no retailer shall conduct any event in which the winner of a prize is determined, in whole or in part, on a sporting event.”
Rep. Matt Bell, R-Avilla – one of the co-authors of the bill legalizing the bar and tavern gambling – agrees with the policy decision the commission made.
“I think that’s a very dangerous road to go down,” he said. “That would more or less be taking the public-policy stance of allowing sports-pool betting in Indiana, and I don’t think the General Assembly is ready to take that step.”
Indiana casinos are not allowed to offer sports betting. Bell said specifically he did not want to encourage betting on local high school sports teams.
“In a perfect world the tavern owners would like to have it, but they also understand that they have been afforded an opportunity here that they never had before,” Bell said. “We need to start slow.”
Marquardt said he and some of the members of the Indiana Licensed Beverage Association – an organization that pushed for the gambling options – are a bit disappointed, but he said he understands the concern.
“Unfortunately we won’t be able to do any of the sports drawings,” he said. “The office pools can still do theirs because no one enforces it. But considering what they have given us, we couldn’t argue too much.”
The rules also clearly prohibit any activities through the Internet or extending credit to patrons.
Some of the rules – including a strict prohibition on comingling gambling money with other bar proceeds and requirements to keep information on many of the winning patrons – appear to be scaring some bar and tavern owners away so far.
There also was brief confusion about whether the bar would be responsible for collecting sales taxes on the tickets sold. But the Indiana Department of Revenue said they would not because there is a 10 percent excise tax paid by the bar to the ticket distributor.
There are between 6,000 and 7,000 retailers in the state authorized to participate, those who are licensed to sell alcoholic beverages to customers for consumption on the premises of the tavern.
But Bell said he never believed that major restaurant chains with open bar areas, such as Applebee’s and T.G.I. Friday’s, would be interested.
That would leave about 2,000 to 3,000 retailers that are more likely to participate, according to Marquardt.
So far, only about 500 retailers have paid the $250 application fee. In the future, the annual renewal fee will be based on gross gambling revenues.
Just over 200 Type II gambling endorsements have been granted while others are pending due to incomplete information or because the commission is waiting for limited criminal background checks on the owners.
“I think it’ll catch on,” Marquardt said. “Some people just aren’t sure or are nervous right now.”
nkelly@jg.net
