Full steam ahead for new pulltabs

There still are lots of questions two weeks after video pulltabs were launched to pay for the Vikings stadium, but the games are popping up at more bars across the state and might come to the airport.

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Electronic pulltab devices made their debut in Minnesota Tuesday, September 18, 2012

Photo: Jeff Wheeler, Star Tribune

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It's been a wild two weeks for Colin Minehart, one of Minnesota's most ambitious promoters of electronic pulltab games. Fifteen hours a day, he's on the phone, on the road, cajoling bars and restaurants to install the new games that are supposed to fund the Vikings stadium.

Minehart is the gambling manager for the Minnesota Licensed Beverage Association, an organization that has emerged as a key driver since the games were rolled out Sept. 18. Three of the five bars that launched the gambling tablets are tied to the MLBA's small charity. Another four signed on last week. Dozens more are expected down the road.

"I just signed up Tom & Jerry's in Chisholm," said Minehart, leaving the Iron Range bar co-owned by former Minnesota Sen. Jerry Janezich. "Now I'm on my way to Wright. I'm getting ready to go to Long Prairie, Sanborn, then back to Milaca. ... I'm averaging 1,000 miles a week."

Nearly two weeks after Minnesota became the first state in the nation to widely offer electronic pulltab games -- the state's formula for funding its $350 million share of the new Vikings stadium -- it's full steam ahead.

A handful of players have emerged as their unofficial engines, about 20 bars and restaurants have installed the games, the Minneapolis-St. Paul Airport Foundation is eyeballing them, and kinks in the system are getting ironed out.

But many charities are having a hard time getting answers to all their questions, especially about costs. Some worry that the bars may be taking too active a role. And the companies that have historically sold gambling equipment to Minnesota charities have been locked out of the competition.

"Nobody knows what's going on," said Ken Baltes, gambling manager for Catholic Eldercare in Minneapolis, who was among the gambling managers taking notes at an e-gaming seminar last week at the Minnesota Gambling Control Board. "Part of the information you can get here [with state regulators.] Part is with the vendor."

Debugging the system

That vendor is Express Games MN Inc., a company incorporated in June that has sole distributorship of this first line of e-games. Express Games President Jon Weaver, a former Michigan-based real estate developer, has become the epicenter of information on the devices that have so much riding on their success. Its unofficial hub of operations: O'Gara's Bar and Grill in St. Paul.

So far, modest glitches have emerged, he said. The most common is that cashiers at gambling sites enter the wrong PINs, which after three tries locks the system. There are ways to unlock it now, he said, but technicians are working on a simple way to deal with it.

Another glitch is that at the end of each month -- as in Monday -- charities must file new e-gambling reports with state regulators, with data such as games' revenue and prizes paid. But not all the required information was available, said Weaver, so that is being fixed, too.

Meanwhile, the gambling devices are getting test runs across the state, from the Grey Eagle-Burtrum Lions Club in central Minnesota to Drkula's 32 Bowl in Inver Grove Heights. The idea is to let charities and bars see firsthand how the games work, said Weaver, who also wants to learn the differences in Minnesota's gambling habits.

"This month has been about getting the system up and running, getting out the bugs," Weaver said. "In October we'll really focus on getting our install process up and running at full capacity. Instead of five to 10 sites a week, installing 25 or 35 a week."

Meanwhile, e-gambling may find a new home at some of the bars and eateries at Minneapolis-St Paul International Airport. The executive director of the airport's foundation, Jana Vaughn, met with gambling leaders Friday.

"We're looking at it, and we're getting a little excited," Vaughn said. "I suspect we will probably do something, but it has to be approved by the Metropolitan Airports Commission."

Others locked out

The games' swift takeoff has not gone unnoticed by Minnesota's longtime paper pulltab distributors, who have sold about $1 billion in paper pulltabs each year but who have been locked out of the e-gaming's starting gate. Under Minnesota law, paper pulltab manufacturers can't give exclusive distributorships to all their products, just to some individual games. That law doesn't apply to the video pulltabs.

Longtime gambling equipment distributors are eagerly waiting for another gambling device to get approved by the state so they can begin selling it, too.

"Until then, we're on the outside looking in," said Mike Peters, general manager of M. Peters Enterprises, a Waseca-based company that has sold pulltabs in Minnesota for 25 years.

But for the charities at the starting gate of the great experiment, life has been good. Shawn Donahue, gambling manager for the Spring Lake Park Lions Club, says customers are happy and revenues are up about 10 to 20 percent. And his electronic pulltab operation, run out of Monte's Bar and Grill in Spring Lake Park, has seen a steady stream of charities and bars stopping by to see the games in action.

"It's great to be a pioneer in the industry," Donahue said.

But for every Donahue, there are many more gambling managers scratching their heads. Some gathered last week at an educational seminar at the Minnesota Gambling Control Board. Board staffer Alyce Jacobs stood in front of the group with her PowerPoint presentation and explained the ABCs of electronic gaming.

The group peppered her with questions. "Can you limit the length of time people play the games?" one gambling manager asked. Jacobs: No.

"If we already have Wi-Fi in our building, can we tap that for the new devices?" asked another. Jacobs: Ask the manufacturer.

"Will the bar owner get more rent if he adds electronic games?" Jacobs: No

"Do you need insurance on the devices? " No. But it's something to discuss with the vendor.

On several occasions, Jacobs flatly admitted that "I don't know all the answers."

It's all part of the challenge, gambling observers say, of being the first in the nation to launch a new form of charitable gambling. Virginia is expected to launch in November. Minnesota charities are keeping their fingers crossed that more answers will be available in the weeks ahead.

Jean Hopfensperger • 612-673-4511

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