Nevada Regulators Grant Initial Approval For Outdated Gaming Rules To Eliminate

April 13, 2023
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The Nevada Gaming Control Board has approved the removal of more than a dozen outdated regulations, as well as several improvements to existing regulations, in an effort to comply with a directive issued by Governor Joe Lombardo.

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The Nevada Gaming Control Board (NGCB) has approved the removal of more than a dozen outdated regulations, as well as several improvements to existing regulations, in an effort to comply with a directive issued by Governor Joe Lombardo.

In January, Republican Lombardo tasked all state agencies to review existing regulations and recommend at least ten for removal by May 1. The NGCB's unanimous recommendation on Wednesday (April 12) sends both lists to the Nevada Gaming Commission for final approval at their April 20 meeting.

“I think it’s always time to go through them … to see if we can make them a little bit better, a little less burdensome and, of course, more workable for the industry, while still maintaining effective regulations that this state desires and deserves,” said Kirk Hendrick, chairman of the control board.

Most of the subsections and amendments dealt with by the NGCB are no longer needed due to changes in the gaming industry over the last four decades. Other regulations dealing with hosting centers or auditing and of financial statements needed to be updated to lessen the regulatory burden on licensees.

For example, one rule targeted for an upgrade would increase the threshold amount from $1,200 to $5,000 at which licensees are exempt from recording a progressive log on a recurring basis. All licensees would be able to record the amount every seven days, if the NGCB approved the online slot-metering system.

The change was expected to alleviate what board members called “unnecessary administrative burdens on the casino operators.”

Hendrick noted that regulations that stuck out to him include Regulation 5.205 that caps payouts on keno games at $250,000, as well as the requirement that written approval is needed by the NGCB chair if a payout exceeds that limit.

Hendrick asked the NGCB audit division chief, Thomasina Fremont, how long that payout cap had been in place. Fremont noted that she has been with the agency for 29 years and it has been at least 29 years.

He also asked if there was any reason why the control board had not come around to removing or increasing this cap.

“I really don’t know. I just think that with Governor Lombardo’s order it just gave us an opportunity to really look at this stuff,” Fremont said. “I think we were going business as usual and so as we were fulfilling this requirement, we went 'this really doesn’t make any sense'."

“This probably was a long time ago, before the larger payouts were in the other revenue sections and as they evolved over time, we just didn’t see the connection. It was just overlooked I believe.”

Also recommended for removal was Regulation 5.200, subsection 3a, governing the operation of a gaming salon on the property of a resort hotel to notify the NGCB by telephone or email each time the salon is opened or closed for play.

As of January 2022, 11 of the 65 private salons in Nevada were operating. NGCB staff supported the removal of regulations that would allow these salons to operate without such a high degree of oversight.

If the regulation is removed, licensees must still keep all internal records for random inspections and board audits.

“For those who may not be familiar with the particular verbiage, a gaming salon is a private area of gaming set up for what you would call high rollers,” said commissioner George Assad. “It’s tremendous benefit for the industry and I’m sure they’re happy with its removal.”

Assad said the regulation was quite burdensome, especially every time a casino welcomes a high-roller at their property, they must telephone or email the control board.

“Now all you have to do is keep a little private log,” he said.

Fremont also proposed regulators delete Regulation 5.225, subsection 19, governing wagering accounts. She said this proposal would change the requirement that licensees submit their wagering account rules for approval prior to implementation.

“When we first started having the wagering accounts, we felt that this was necessary, but as time has gone by, they are submitted to us and we approve them,” Fremont said. “We figured out what we are doing. The industry has figured out what it is doing. This isn’t necessary anymore.”

Daron Dorsey, executive director of the Association of Gaming Equipment Manufacturers (AGEM), testified in support of the items listed in the agenda for improvement or deletion.

“We applaud the board’s action in this regard,” Dorsey said. “We think this is a great first step and many other steps to come. We will be bringing forth what AGEM believes are some additional items that could be eliminated or revised.”

He assured the three-member control board that AGEM would get the list to them in about a month. The board is planning to have further workshops to discuss more potential candidates for deletion.

Prior to the control board approving both agenda items, Dan Reaser, a gaming attorney with Fennemore, flagged several regulations that he urged them to look at improving, including Regulation 9 that deals with temporary closures of locations, what happens when a licensee dies and estate planning documents.

“These are big issues that people are struggling with, and the regulation is quite old,” Reaser said.

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