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Slot machine-style games OK'd for video lottery machines

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Mitchell South Dakota 120 South Lawler 57301

PIERRE -- The South Dakota Lottery Commission received final clearance Tuesday for its plan to allow lineup games, similar to those found on slot machines, on video lottery machines throughout the state.

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The Legislature's rules review committee voted 6-0 to approve the commission's proposed rules despite strong opposition in the past from representatives of Deadwood gambling casinos.

This time, no one representing Deadwood interests stepped forward to speak against the change.

Legislators on the review panel said the move to add lineup games appears to be in accord with state laws and the state constitution regarding video lottery.

"In going back and looking at it, it's definitely my feeling these rules do meet the criteria," said Sen. Mike Vehle, R-Mitchell.

Rep. Roger Hunt, R-Brandon, said the committee received information for and against the change. He said no one produced an offi-cial legal opinion regarding the matter either way. Hunt said the legislators on the panel did their homework.

Sen. Jean Hunhoff, R-Yankton, said adding lineup games is an opportunity to sustain a source of revenue for state government after play dropped sharply since the smoking ban took effect in November for bars, casinos and restaurants with alcohol licenses.

"There is support for it," Hunhoff said.

State government receives half of the money lost in the privately owned video lottery machines after winnings are paid. Video lottery is the second-largest single source of general revenue for state government after the sales tax.

There are about 9,200 video lottery machines currently in operation throughout South Dakota and about 3,600 slot machines in Deadwood and another 2,000 or so slot machines in tribal casinos within South Dakota's borders.

The state's property tax reduction fund took in $109.3 million in fiscal 2009 and $106.5 million in fiscal 2010 from video lottery. For fis-cal year 2011, which ends June 30, the state Bureau of Finance and Management expects $97.2 million. The BFM forecast for 2012 is $90.8 million.

South Dakota voters approved an amendment to the state constitution in 1986 allowing a lottery and passed another constitutional amendment in 1988 allowing poker, blackjack and slot machines in Deadwood.

The Legislature and the Lottery Commission started video lottery play in 1989. The terminals offered a basic mix of electronic poker, blackjack and keno. Deadwood casinos opened that same year.

The state Supreme Court shut down video lottery in 1994 because it wasn't specifically authorized in the state constitution. Voters that November approved a constitutional amendment that allowed video lottery to start up again.

Line-up games have been recognized as an option in the lottery's rules for video lottery since 1989 but were never allowed to be of-fered until now.

The definitions of what's legal became blurry in recent years. In one instance, the state Commission on Gaming declared an elec-tronic roulette table to be a form of slot machine.

The rule changes approved Tuesday included many technical advances such as thermal printers for video lottery winner tickets and use of communication systems such as wireless rather than traditional telephone lines to connect the individual terminals and the state's central monitoring system.

"It makes sense to stay in line with advancing technology," said Sen. Angie Buhl, D-Sioux Falls.

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