OSHKOSH (NBC 26) — Gambling machines are illegal outside of tribal casinos in Wisconsin, but they’re still found in nearly every bar in Oshkosh. As new businesses try to find loopholes to the state law, Oshkosh reexamines its liquor licensing process.
- The penalty for having gambling machines in Oshkosh depends on which liquor license the business has.
- If a business has a Class A liquor license and owns gambling machines, it could face a felony charge. If a business has a Class B liquor license and owns gambling machines, it is only subject to a fine.
- The Department of Revenue has not historically enforced this law closely, but it's now beginning to help municipalities across the state with stricter enforcement.
On Dec. 9, the Oshkosh City Council held a workshop on gambling machines and liquor licensing. A representative from the DOR alcohol division, Travis Borkenhagen, clarified the laws to the council.
Gambling machines are illegal, but the penalty for breaking that law depends on which liquor license the business holds.
Bars and restaurants all have Class B licenses, which allow them to own five or fewer machines and face only a fine if they are caught.
Many convenience stores and gas stations hold Class A licenses, which means they would face a felony if caught with any gambling machines.
“What we’re seeing now is this trend toward people recognizing, wow, if I get this Class B license, I may be eligible for a reduced penalty,” Oshkosh city attorney Lynn Lorenson said during the workshop.
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Borkenhagen says they’ve seen this trend across the state– convenience stores are attempting to section off a small portion of their building, saying it’s essentially a bar and requesting a Class B license for that portion.
He says the DOR is a small department and limited in how they can enforce this law, but that municipalities can take action in their own ways– whether that’s creating an ordinance banning video gambling machines or making it harder to obtain a Class B license.
“We can only do so much at the state level,” Borkenhagen says. “But you, as a municipality, have broad discretion on approving or not approving licenses. Once you do issue a license though, getting that license back is very difficult to do.”
The Oshkosh City Council is looking at how to fine-tune its Class B license process so only bars and restaurants can obtain one.
“We want to make sure that we set policy so that when they are taken out and they are being used that they’re being used in a way that’s fair to everybody, and they’re not just being used as a loophole to state law,” councilor Karl Buelow says.
Local bar owner Tom Bollom owns gambling machines and says they’re great for business.
“They bring people in, those machines do,” he says. “It really helps the bar business.”
Bollom says he rents the machines from Midstate Amusement, which is a business out of Fond du Lac. They rent games to many of the bars in Oshkosh.
NBC26 spoke with Midstate Amusement over the phone. They said they understand they operate in a legal gray area.
“Just because you’re speeding, doesn’t mean you’re going to get caught and get a ticket, but you should know, that if you’re speeding, it’s not legal, and it’s the same thing with these gaming machines,” Buelow says.
Other Midwest states have different laws when it comes to gambling outside of Native reservations.
You can find more information on state-by-state regulations here.
