History and evolution of Nevada Casino laws over 150 years

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Nevada’s history with gambling is a fascinating journey that has evolved from an outlawed practice to a thriving industry and has 150+ years history. Las Vegas is a bellwether of the money gaming industry and biggest city in terms of casino revenues in the USA.

History of Nevada Casino culture

In 1869, just five years after becoming a state, the Nevada Legislature overrode veto by the Governor Blasdel to enact the state’s first statutes legalizing gambling. The only regulations were that professional gamblers could not operate a game without a license from a county sheriff and gambling could not be conducted in the front room of buildings.

For the next 40 years, the Nevada Legislature adjusted tax rates and splits with local governments, restricted gambling on Sundays, and limited gambling to second stories of buildings in large counties.

Fast forward 1909, the Nevada Legislature closed the first era of legalized gambling in Nevada and gambling ceased to be a legal activity on September 30, 1910.

From 1915 through 1931, the Nevada legislature toyed with permitting limited slot machines, but gambling continued to be a popular activity despite its illegality. While politicians often campaigned on bringing gambling back, it was the Great Depression that convinced the public to abandon the temperance movement and to revisit legalized gambling.

The 1931 Nevada gambling legislation

In the 1931 legislative session, Humboldt County Assemblyman Phil Tobin introduced legislation to permit “wide open” gambling in Nevada.  Despite strong opposition from the Public Morals Committee, the bill passed the Assembly 24-11 and the Senate 13-3. Governor Balzar signed the bill into law on March 19, 1931.

In its original form, the 1931 Act did not regulate gaming. The only qualification for licensing was that applicants be American citizens. Eight days after Balzar signed the bill into law, the legislature rectified the oversight by granting local authorities the power to regulate or prohibit gaming.

While Nevada’s casino industry began to grow in the late 1940s, neighbouring California began cracking down on illegal casinos.  Many illegal operators in California came to Nevada to operate, both legally and illegally. Many allegations were made of cheating and lack of enforcement against illegal operators.

In 1949, the Nevada Legislature shifted licensing authority from local to state government, and gave the Tax Commission statutory authority to regulate gaming and adopt regulations. The 1949 amendments are significant in its emphasis on the application process and the grant of regulatory authority.

From this point, the current regime of Gaming Commission, Gaming Control Board got evolved over a period of time.

Nevada Gaming Control Board and Gaming Commission

The Gaming Control Board is a full-time agency that administers the Gaming Control Act and the regulations adopted by the Gaming Commission. The Board has three members and hundreds of dedicated staff. By statute, one of the three Board members must be an accountant, and another must have training as a law enforcement officer or an attorney.

The Commission consists of five members appointed by the Governor to four-year terms, with one member acting as Chairman. The Commission members serve in a part-time capacity.

The primary responsibilities of the Commission include acting on the recommendations of the Board in licensing matters and ruling upon work permit appeal cases. The Commission is the final authority on licensing matters, having the ability to approve, restrict, limit, condition, deny, revoke or suspend any gaming license.

The Nevada gaming regulatory system is heavily front loaded, this means a significant portion of regulatory resources is expended in investigating applicants before they are licensed. Pursuant to Nevada statutes, applicants for a license must prove their suitability, the burden lies solely on the applicant.

Article and Image Credit: The information including the feature image has been sourced from a presentation by Greg Gemignani Adjunct Professor of Law at the Boyd School of Law