New Hampshire Considers Replacing HHR Machines With Slots, and Other Changes for Charitable Casinos
Charitable gaming in New Hampshire could soon see important changes, including how casinos partner with charities and the introduction of true, casino-style slots. The New Hampshire Charitable Gaming Study Commission (NGCGSC) is considering several recommendations from Spectrum Gaming in a study on the future of gaming in the state. The commission will make its final recommendations to lawmakers by November 1.
If the changes go through, casino-style slots would replace the historical horse racing (HHR) machines currently in use at New Hampshire’s charitable casinos. Although HHR machines bear a passing resemblance to slots, they function quite differently under the hood. Because they use data from past horse races to generate their results, they are legally considered a form of parimutuel betting in New Hampshire and some other states.
Last year, the state Legislature formed the commission to assess how state laws impact gaming in New Hampshire. The NGCGSC comprises lawmakers, state officials, casino operators, and charity representatives. Some of the proposed changes the commission is considering include:
- Changes in how casino revenue is shared between charities
- Extended operating hours
- Allowing complimentary alcoholic drinks
- Increase in bet limits
- Allowing gambling on credit instead of cash only
New Hampshire’s laws don’t permit full-scale commercial casinos. The 12 gambling establishments in the state operate under charitable gaming laws. In addition to the HHR machines, they can offer bingo, poker, roulette, and the blackjack variant Spanish 21. There have been attempts to legalize other forms of gaming, including online casinos. One member of the NGCGSC, Sen. Timothy P. Lang Sr., sponsored an iGaming bill last year, though that proposal died early.
Potential Legislative Changes
Last year, New Hampshire’s casinos distributed $31.2 million in gaming revenue between 800 charities. Under current laws, casinos must choose two charities daily to share HHR machine revenue and one for table game revenue. A single charity can benefit from between seven and 10 days worth of revenue each year.
At the moment, the division of proceeds isn’t particularly equitable. Some charities receive as much as $150,000 a year, yet there are 5,000 registered charities in the state, over 80% of which have been left out. There are no standards on how casinos choose their partner charities. The commission is considering changes to guarantee that more organizations get at least some access. Some members of the commission, such as Sen. Lou D’Allesandro, have advocated for prioritizing organizations that provide essential services, like shelters for the unhoused and victims of domestic violence.
Many of the other proposals under review aim to increase revenue. Currently, casinos operate from 8 a.m. to 4 a.m., making New Hampshire the only state in New England without 24-hour casinos. One proposal aims to change that. Service of free alcoholic drinks and the ability to extend credit to patrons would likewise bring New Hampshire’s regulations in line with those of other northeastern states.
A few months ago, Rhode Island increased credit line maximums to $100,000 to help its casinos compete with those in neighboring Massachusetts.
Slots Can Help Increase Gaming Revenue
According to the Spectrum Gaming study, New Hampshire casinos capture only about 16% of their potential gross gaming revenue, which it estimates at $1.1 billion. The report suggests the state can support nearly 6,300 HHR machines, a significant increase from the current 2,000.
Spectrum also recommends that the state transitions to slots. The biggest practical difference between HHR machines and slots is that the HHRs can take longer to generate a result, which means a slower experience for the player and less revenue for the operator. The fact that HHR machines pit players against each other rather than the operator also has implications for the payouts.
More importantly, from an accounting standpoint, HHRs incur high ongoing costs. Casino operators must pay between 6% and 12% of the machines’ gross revenue to the company that provides the underlying mathematics and horse racing data.
New Hampshire considered adopting slots three years ago but opted for HHRs at the time.
However, despite the potential financial benefits, there are concerns that slots are more addictive, mainly because of the faster pace of play. Even gaming proponents from the NGCGSC, such as Sen. Lang, believe the proposal to swap HHR machines for slots will encounter resistance in the legislature.
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