Port: North Dakota's gambling revenues went up 52% after e-tabs were legalized and that's hurting the state's tribes

MINOT, N.D. — During their 2017 session, North Dakota lawmakers passed a bill making electronic pull tabs legal.

I can't claim a lot of experience with these things. I've never used one (I'm not a gambler), but while they're called pull tabs, they seem to function like something akin to a slot machine. Which, as anyone who has ever visited a casino knows, is a prevalent form of gambling.

Thus, perhaps not surprisingly, the legalization of "e-tabs" (as they're known) has hit the traditional casinos which operate in North Dakota pretty hard.

According to a report by my colleague, reporter Natasha Rausch, the revenue produced by gambling in North Dakota jumped more than 52% from the two years before e-tabs were legalized (a very limited amount of gaming, for the benefit of qualifying charities, has been legal in North Dakota for some time now ) to the two years after.

That increase has come at the expense of tribal gaming.

"Collette Brown, gaming commission executive director for the Spirit Lake Tribe, said the Spirit Lake Casino Resort, seven miles south of Devils Lake, saw a 42% decrease on its bottom line in one year," Rausch reports.

Understandably, our tribal neighbors are worried.

"It's no small thing for us," Mark Fox, chairman of the Mandan, Hidatsa and Arikara Nation, told Rausch. "It's of dire concern, at a minimum."

Scott Davis, North Dakota's commissioner for Indian Affairs, tells Rausch what's going on is "casino creep." That sounds about right. The tribes were able to find success with casinos because, given their unique jurisdictional situation, they were able to offer North Dakotans a way around the state's prohibition on gambling.

Yet as policymakers punch holes in that prohibition, the advantage tribes have on gambling weakens.

That's not a small issue for them.

What can be done? Should North Dakota forgo reforms to gaming policy for the sake of propping up tribal enterprises?

There are a lot of lessons to learn from this situation.

The folly of governments, be they tribal or not, operating businesses for the sake of revenue is one lesson. Business is risk, and that risk should be left to the private sector.

Another is the problems associated with any given government becoming too dependent on one revenue stream.

North Dakota's tribes lean on gaming revenue. If it goes away, that's, well, a "dire concern," as Fox said.

(The State of North Dakota is in a similar situation with oil. Presently, at least $1 out of every $2 in taxes collected by the state comes directly from the oil and gas industry, and that's not counting the indirect tax revenues they drive through the sales tax, etc.)

Public attitudes about gambling are changing. They have been for some time. It is inevitable that North Dakota, like other states, will continue a march toward more liberalized gaming policies. The tribes will need to figure out how to make their casinos attractive and relevant in that environment.

And they're probably going to need to diversify their revenue streams along the way.

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Rob Port, founder of SayAnythingBlog.com, a North Dakota political blog, is a Forum Communications commentator. Listen to his Plain Talk Podcast and follow him on Twitter at @RobPort.