Gaming in Alaska: will large-scale gambling come to the 49th state?

• Author: Orr, Vanessa

Each year, thousands of Alaskans wait to hear when the ice breaks on the Nenana River. Thousands more participate in fishing derbies, or spend time socializing at bingo games or playing pull-tabs. While gambling in Alaska is illegal, there are certain gaming activities, such as contests of skill, animal classics and dog-mushing contests, which are allowed for the purpose of raising money for charities and revenues for the state.

"Gambling in Alaska is illegal, except under the 'charitable gaming' statute, which allows some forms of gaming by municipalities and not-for-profit organizations," explained Joseph Koss, a tax auditor for the Department of Revenue, Tax Division, Gaming Group. "The name, however, is misleading--an organization doesn't have to have any charitable purpose in order to have a gaming permit."

There are many different forms of gaming in Alaska, with pull-tabs, bingo and raffles being the biggest attractions. In 2004, more than $341 million in gross receipts was earned through gaming activities, with approximately $259 million returned in prizes. The total net proceeds from gaming, minus taxes, prizes and expenses, totaled $31 million.

"While pull-tabs, bingo and raffles are the Big Three in gaming, there are many other contests of skill and various types of classics that take place throughout the state," said Koss. "These include things like the Canned Salmon Classic, Mercury Classic, Rainfall Classic and the Nenana Ice Classic.

"Classics are usually limited to a specific organization, like the Goose Classic, which can only be held by two organizations," added Koss. "Fish derbies are also included in gaming regulations, though they are not considered the same game type as animal classics."

Though there are many small classics throughout the state, these, along with derbies and contests of skill, make up only a small part of Alaska's gaming. In 2004, these activities earned roughly $2.4 million in gross receipts, or less than 1 percent of the $341 million earned. Raffles earned $9.5 million, or 2.8 percent, and bingo earned $67 million, or almost 20 percent of the total. The largest gaming activity was pull-tabs, earning 77 percent of total gross receipts, or $262 million.

The money that is earned in Alaska through gaming activities is required to be used for public benefit in the form of money for organizations and revenue for the state. Charities represent only one of 15 kinds of qualified organizations permitted to game...