The popularity of high-stakes poker may soon spread to the State House.
Increasingly, charitable organizations throughout New Hampshire are raising money by sponsoring poker tournaments — where $5,000 is typically the top prize, enough to draw hundreds of card players — leaving some legislators wondering whether the state should share in the jackpot.
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“I’m not particularly fond of gambling, but if the state is going to allow gambling for charitable purposes and we’re getting into high-stakes stuff, I think the state should get some revenue from it,” said Rep. Neal M. Kurk, R-Weare, the current chairman of the House Finance Committee.
He has filed a legislative service request to draft a bill that would impose some type of state tax on high-stakes poker profits. The proposal would be considered in the legislative session that begins in January.
“I’m not suggesting that we tax the winners,” Kurk said.
“We need to take a good serious look at whether promoters may be taking an unacceptably large portion of the gross and charities are not getting enough. It seems we’ve increased the amount of revenue by an order of magnitude and we need to look at that as an issue,” he said.
Similarly, Sen. Lou D’Allesandro, D-Manchester, voiced “concern” in an interview about the rapidly expanding popularity of poker tournaments.
D’Allesandro has supported the legalization of video poker machines at the four racetracks in the state. He views that as a way to create jobs and revitalize the racing industry.
“This is a little different,” the senator said of the poker tournaments.
“Shouldn’t there be uniformity? Shouldn’t there be monitoring? And shouldn’t the state be receiving revenue from these poker tournaments? Those are all questions that should be answered,” D’Allesandro said.
The fast-paced “Texas Hold’Em” style poker tournaments arrived at the Manchester Bingo Center last January. The sponsor was On the Road to Recovery, a charity that helps the mentally disabled.
30 charities
In the past 10 months, according to Audrey Blodgett at the Attorney General’s Office of Charitable Trusts, about 30 charities have filed applications to hold poker tournaments in Derry, Keene, Pembroke, Laconia and a half-dozen other communities.
Promoters stage the tournaments under the state gaming law that allows a charity to sponsor up to 10 so-called Monte Carlo fund-raisers each year. The charities must report to the state the prizes awarded, expenses paid and revenue raised, but there is no state oversight of the games, which are conducted under a permit obtained from the local police.
The state’s gaming law has a $2 bet limit, but tournament promoters get around that by assigning no monetary value to the poker chips.
Each player pays to sit in on the game: usually, $100. The player is given a stack of chips: usually, 1,000. A player can husband the chips or go through them quickly and buy more.
At night’s end, and based on the specific house rules, prizes are awarded to about a dozen players who accumulated the largest number of chips. Depending on the number of players who paid into the pot, it is not unusual for the winners to split $15,000 or more in prizes.
Charity’s share
Under her contract with the promoters, Andrea Tinkham, executive director of On the Road to Recovery, agreed to pay “50 percent of all net proceeds,” after prizes and expenses, to S & T Consultants Inc., the bingo center’s managers, James Timbas and James Cristos.
Tinkham said her charity made an average of $2,500 for each of its 10 poker nights.
“Between bingo and poker last year (the fiscal year that ended June 30), we made $40,000 and I broke even for the year,” Tinkham said of the fundraising that supplemented the organization’s annual state allocation of about $177,000.
On the Road to Recovery currently sponsors bingo Wednesdays and Thursdays, which takes in about $1,200 a month, after prizes and expenses.
Unlike bingo
From the state’s perspective, the poker tournaments are unlike bingo because the state neither regulates nor profits from the games.
In the fiscal year that ended June 30, 253 charities grossed almost $90 million and — after prizes and expenses — cleared $10.9 million from bingo and the Lucky 7 pull-tab gaming tickets sold during the games.
As for the state, “We collected roughly $2 million,” George Roy, finance director at the New Hampshire Lottery Commission said of last year’s bingo revenue.
The state collected $904,000 from a 7 percent tax levied on the various “winner-take-all” bingo games. It got $879,000 as its cut on Lucky 7 sales, and also collected licensing fees from the charities that sponsor the games and the ticket distributors. Roy estimated it costs about $500,000 a year for the commission to administer and the state police to enforce the bingo laws.
Oversight shifts
Under a new law, administration and enforcement of the bingo laws will become the responsibility of the Pari-mutuel Commission in January.
“We regulate bingo and Lucky 7 and the lottery, but (high-stakes poker) is something that came about just this past year,” said Rep. Norman L. Major, R-Plaistow.
“This is big money and there is no state oversight on these tournaments, or income to the state from them,” he said.
“I think there will be serious discussion of this,” when the Legislature looks for new tax revenue next year, said Major, the current chairman of the House Ways and Means Committee.
Colebrook Rep. Frederick W. King recalled that Ways and Means, favoring an increase in the cigarette tax, showed no interest earlier this year when he suggested poker might be a source of new revenue.
He said he was ready to present figures showing Minnesota was collecting more than $4 million a year in taxes on a 50-table card club it licenses at a track called Canterbury Park.
“We’ve got four tracks in the state and a lot of bingo halls are already having poker tournaments,” King said.
State role anticipated
Lobbyist Richard L. Bouley, president of Bouley Associates, said he expects high-stakes poker will be the subject of several bills in the coming session. He said bingo hall operators are not opposed to state regulation or taxation, as long as it does not adversely impact the charities.
As to the state’s need for revenue, Bouley said, “We feel the state is going to want to have a share. It all depends on how they do it and how much they want.”
High-stakes poker poses temptation for the state, warned James M. Rubens, chairman of the executive committee of the Granite State Coalition Against Expanded Gambling.
“We don’t take a position on whether it should be taxed or not, but we are concerned that, if there is to be a tax, it could motivate the state to maximize revenue and tweak the rules to extend the meaning of the (gaming law). The net result being that there is more gambling that ends up behaving like video slot machines and looks like casinos,” Rubens said.
Source: The Union Leader
