In 1960, the Alaska Legislature enacted regulations allowing certain games of chance and contests of skill, for purposes of charitable fundraising. The state doesn’t participate in national lotteries like Powerball or Mega Millions, but does allow games like pull-tabs and bingo, which directly fund charitable organizations.Â
Inside the more than 1,000 pull-tabs shops and bars in Alaska, players try their hand at winning money, while proceeds ultimately go back to specific charitable organizations. Those pull-tabs locations can become a site of community, and it’s also the most popular form of charitable gaming in the state.
“You’ve got slow days, busy days. Slow times, busy times,” said Kayla Hanson, the manager at River City Pull Tabs in Soldotna. “Most of the time, the first of the month is a busy time. Any time there’s an influx of money coming into the community: PFDs, tax returns.”
River City Pull Tabs helps support the Soldotna Chamber of Commerce. The chamber uses the funds for scholarships, and to support its weekly free Music in the Park events during the summer.
Hanson said the experience of playing pull-tabs can be as much about people as it is about money.
“My mom managed this place for 25 years before she passed away two years ago,” she said. “And then I’ve worked here for…coming up on 10 years. And the other gentleman who works here has been involved in pull-tabs and bingo for well over 15 years.”
Hanson said she sees a mix of regulars and one-time customers. And she said the amount of time they spend in the shop varies from two minutes to several hours.
The shop is centered around a tall counter surrounded by barstools, with Hanson in the center, doling out tickets. Pull-tabs themselves, also called “rippies,” are individual pieces of paper with perforated tabs that one rips to reveal symbols, and see if they match winning combinations. There are a predetermined number of winning tickets in a given game.
Around noon, customers trickled in. A regular said the amount of time he spends here depends on whether there’s coffee. Hanson just finished brewing a new pot. Her basset hound Cleo hung around the store, and is also immortalized in a portrait on the wall, alongside a memorial to Hanson’s late mother.
Department of Revenue Program Manager Marty Abel said there are just over 1,000 pull tabs permits in the state. Twenty-four are on the Kenai Peninsula. Those locations support a variety of causes: Power Play Pull Tabs in Soldotna is connected to the local hockey booster club, while Easy Street Pull Tabs near the Kenai Safeway is linked with the Ninilchik Senior Center.
Pull-tabs aren’t just available at dedicated locations; for-profit businesses can host gaming on behalf of a charitable permit-holder, or a licensed alcohol vendor can sell pull-tabs for a qualified permittee. There are eight of those on the peninsula.
Ken Alper directed the Alaska Tax Division from 2014 to 2018, where he oversaw charitable gaming. He said after the price of oil fell in the 80s, nonprofits were looking for new ways to bring in funds as state money declined.
“Part of the way they went to work around it was to set up this system of charitable gaming where the state would regulate bingo, pull-tabs, that sort of thing,” he said. “And the beneficiaries would all be these nonprofits.”
He said pull-tabs rose to be the most popular, probably because of its simplicity to operate versus higher-tech games like slot machines. Alper said pull-tabs make up 60 to 70% of the charitable gaming in the state.
The average net proceeds from pull-tabs in the state, the amount going to charities, is about $25 million per year. But Alper said the total amount the industry brings in annually is more than 10 times that, about 300 or 400 million a year— he said much of the funds are used for operating costs and labor, and about 1% goes to the state as a tax.
Alper worries about the regulation of all that money. He said it has gotten more difficult since the 2019 state budget process when Gov. Mike Dunleavy vetoed huge swaths of the budget, including to the Department of Revenue. Alper said that reduced the charitable gaming division to just a few individuals, and it hasn’t grown since. Staff of the division did not respond to a request for comment.
“I have to assume that they are de facto not looking at the smaller operators at all and letting them function self-regulated because they no longer have the staff to ensure that the smaller ones are even filing their paperwork,” Alper said.
He said the purpose of the tax division staff is to make sure the nonprofits are getting their rightful share of gaming profits, and he said a state regulatory focus should be having enough staff to monitor that money.
