Report of inspection lapses sets off scramble for answers.
State public safety officials will be called before the Legislature to explain why slot machines and blackjack games at Minnesota's Indian casinos have operated with little to no state inspections in the past four years, lawmakers announced Wednesday.
"State regulatory employees are refusing to even visit some of the casinos, much less test a slot machine or monitor a blackjack table," said Rep. Steve Drazkowski, R-Mazeppa, who has been quietly monitoring the issue.
In a separate development, Gov. Mark Dayton met Monday in his office with Public Safety Commissioner Ramona Dohman and her newly installed director of gambling enforcement, Michele Tuchner. Drazkowski also discussed his concerns with Dayton.
"He acknowledged that changes need to be made,'' said Dayton's press secretary, Katharine Tinucci.
Drazkowski's announcement came three days after the Star Tribune reported that slot machine inspections at the state's three largest casinos ceased at least four years ago. The newspaper also reported that the Alcohol and Gambling Enforcement division of the Department of Public Safety made no blackjack inspections at any of the state's casinos in 2008, 2009 and most or all of 2011.
Tinucci noted that the Public Safety agency's gambling enforcement division has had eight or nine different directors in the past decade. Dayton has confidence that Dohman will correct the problems, Tinucci said. Dohman hired Tuchner in October from the Minnesota State Patrol, where she was a lieutenant colonel.
Tuchner told the Star Tribune last week that she is studying how to do more with limited resources. Drazkowski said budgets are no excuse.
"To blame limited resources for not doing your job is an insult to the people of Minnesota," Drazkowski said. "We're talking about regulation of what could be a $20 billion industry in this state.''
Drazkowski started to investigate reports of lax state casino inspections months ago. He also learned that there have been no state reviews of tribal financial audits of slots and blackjack since 2005.
Agreements between the tribes and the state require that slot machines pay out 80 to 95 percent of the money that goes into them over the life of a game, a consumer protection that is one reason for state inspections. The payouts are mandated under the compacts that established on-reservation casino gambling in Minnesota two decades ago.
Rep. Tony Cornish, R-Good Thunder, chairman of the House Public Safety Committee, said he will hold a hearing on the issue in the coming weeks. State Sen. Mike Parry, R-Waseca, chairman of the State Government Innovation and Veterans Committee, also said he will call a hearing.
"We just basically want to get to the bottom of it,'' Cornish said.
Wisconsin audits often
The Star Tribune report said there have been zero slot inspections at Mystic Lake Casino in Prior Lake, Grand Casino Hinckley and Grand Casino Mille Lacs since at least the end of 2007. At the state's seven largest casinos, a mere 35 of an estimated 15,150 slot machine were looked at by state inspectors over the same period, the newspaper reported.
Minnesota has three full-time gambling inspectors assigned to its 18 casinos. Under the original state-tribal gambling compacts, which have no expiration, the tribes are not obligated to share any revenues with the state but they pay a combined $150,000 a year to help fund inspections.
In Wisconsin, where Indian casinos share their money with the state, 15 full-time inspection division workers conduct weeklong on-site visits of every casino once every 18 months. Wisconsin agents inspect 10 percent of slot machines on those visits while also inspecting card games. They do a follow-up review to go with each audit.
The Minnesota Indian Gaming Association has said there is no problem with the integrity of gaming at member casinos. The operations are regulated not only by the tribes, but by the Bureau of Indian Affairs, U.S. Department of Justice and National Indian Gaming Commission.
But Drazkowski said he remains skeptical.
"It's easy to say you're doing a wonderful job when no one bothers to check your work," he said.
Tony Kennedy • 612-673-4213