South Dakota Casino and Card Room Gaming

South Dakota has commercial casinos and slot halls, both of which are only permissible in the city of Deadwood. The casinos have slot machines, blackjack and poker. On 1 July 2015, it became legal for Deadwood casinos to offer roulette, craps and keno. VLTs are allowed at various venues throughout the state, though all other games are prohibited. The maximum number tables and slots allowed per license is 30, but venues may hold multiple licenses.

The 2014 ballot initiative that legalized craps, roulette and keno was approved by 56% of the voters.

The South Dakota Commission on Gaming (SDCG), within the Department of Revenue, is responsible for the enforcement and operations of casino gaming in the state. A governor-appointed, five-member commission has oversight of the SDCG and casino gaming policy. Members of the commission must be citizens of South Dakota and may not all be affiliated with the same political party. A member is prohibited from being either a gaming license holder or a resident of Lawrence County. Members serve for a three-year term for at most two consecutive terms. The SDCG provides background and criminal investigations, compliance and revenue audits (of casinos within the city of Deadwood), and slot machine inspections. The SDGC also maintains statistical data regarding gaming activity under its jurisdiction.

By law, the tax rate for casinos is 8% of the adjusted gross revenue. Forty percent (40%) of the 8% tax is transferred to the Department of Tourism, 10% is distributed to Lawrence County and the remaining 50% remains in the SDCG fund. In March 2009, legislators passed an amendment (HB1251) to the gaming laws that levied an additional 1% of the adjusted gross revenue on casinos that went directly into the state general fund. In addition, each gaming device, which includes table games and slot machines, is assessed an annual license stamp fee of $2,000. These device fees, all licensing fees and all other miscellaneous revenue received by the SDCG are deposited into the SDCG fund. Administrative costs of the SDCG are paid from that fund, which has historically been below 7%.

There are seven licenses types: slot machine manufacturer or distributor, with a license fee of $1,000 and an annual renewal fee of $250; operator, with a license fee of $1,000 and an annual renewal fee of $200; retailer, with a license fee of $250 and an annual renewal fee of $100; support, with a license fee of $75 and an annual renewal fee of $25; key employee, with a license fee of $150 and an annual renewal fee of $75; route operator, with a license fee of $1,000 and an annual renewal fee of $200; and gaming property owner, with a license fee of $250 and an annual renewal fee of $100.

VLTs, over the past two decades, have been outlawed and reinstated on several occasions. The machines are privately owned, but the state licenses them and keeps 50% of the gross profits. The latest attempt to shut down the video lottery came in 2006 and was voted down.

In June 2008, Sioux Falls passed an ordinance that would have banned businesses with VLTs from operating within 2,000 feet of a park or school. The ordinance was challenged in court and in 2011, the South Dakota Supreme Court affirmed a lower court ruling that found the city had exceeded its authority and that South Dakota's constitution intended that the state had exclusive right over the placement of VLTs.

In 2010, the state added a new license type under the regulation of the SDCG, called a gaming property owner. Gaming property owners are people who owned property where licensed gaming was conducted in Deadwood City after 31 December 2009. It does not include licensed retailers. License fees were set at $250 for the first year and then $100 for each subsequent year.

In January 2012, the state increased the maximum bet allowed in Deadwood casinos from $100 to $1,000.

Although regulated by the South Dakota Lottery, Casino City considers VLTs to be a casino and card room gaming activity.