1925

As of 1915, Nevada gambling law only allowed slot machines that discharged tokens, or bingles, exchangeable for on-site merchandise; those that paid out in money or bingles redeemable for currency were forbidden.

“The fact remains, however, that the illegal money machines are running unmolested all over the state and particularly in Reno, under the noses of the state police, the county officers and the city authorities,” noted a Reno Evening Gazette opinion piece (March 13, 1925).

The Nevada Committee on Good Laws, whose members included a reverend and a university professor, took it upon itself to investigate “the slot machine evil,” reported the Reno Evening Gazette (May 2, 1925). The group initiated its efforts in part because it opposed a bill the legislature had introduced that year to allow wide-open gambling. Although the assembly killed the proposal, it didn’t stop the crusaders. Police officers of several counties grew concerned about the spotlight on one-armed bandits and encouraged owners or licensees to turn their illegal ones toward the wall.

In late March, the committee complained to District Attorney L.D. Summerfield that local businesses still were operating the banned devices and pressured him to crack down on these violations. Summerfield immediately informed officers of the law about the illegal activity, reiterated the relevant statutes and directed them to enforce it.

The following month, policemen seized slot machines deemed to be illegal, one each from the Overland hotel, Owl Club, Elite Cigar Store, Washoe Lunch Counter and Block N.

Machines, Owners At Risk

A hearing took place for the justice of the peace to determine the fate of the proprietors and their gambling equipment. If convicted of the misdemeanor charge, the men would be sentenced to a $50 to $100 fine and/or 25 to 50 days in county jail. The machines could be destroyed.

“Reformers and uplifters” packed the courtroom, “the crowd bulging through the doors into the hallway of city hall,” reported the Reno Evening Gazette (May 2, 1925).

Summerfield called the state’s first witness, Good Laws committee member, Otis Linn. The reverend testified that on April 27, when he and Professor F.C. Feemster had played the slot machines at each of the five enterprises on trial, the payouts contained nickels. He showed the court some coins he claimed the instruments had spit out; a single nickel was in the bunch.

In his cross-examination of Linn, the defense attorney pointed out that no pay-back-money machines pay out fewer than two nickels.

“Linn became vexed during that and hurled a handful of coins on the floor as a protest,” noted the Reno Evening Gazette (May 2, 1925). “The Justice of the Peace requested he pick them up.”

Feemster then took the stand and corroborated all that Linn had said. Summerfield even testified, saying money came out when he’d played the machines after they’d been seized.

The only defense witness was up next — A.A. Baroni, the co-proprietor of the Owl Club, Washoe Lunch Counter and Overland Hotel. He testified that all the apparatuses had been loaded with bingles but sometimes nickels the customers inserted to play trickled down into the bingle compartment due to a mechanical defect.

Perry Mason Ending

The five contraptions in question then were opened in court for a look-see. A total of about 300 bingles and 17 nickels were in the bingle bin!

Justice of the Peace Seth W. Longabaugh mulled over the case for three weeks then ruled.

Seemingly highly influenced by the in-court demonstration of what currency actually sat inside the machines, he found the gambling operators had not intended to break the law and, therefore, were innocent.

As such, the gaming devices weren’t to be destroyed but, rather, returned to their owners, which they subsequently were.

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Nevada State Prison

1932-1967

Inmates strutted around the Nevada State Prison yard and jingled the brass coins or tokens, in their pockets, to boast their elevated status as winning gamblers of the pen.

Beginning in 1932, convicts ran an open casino on the grounds of this maximum security facility in Carson City.

The warden allowed and didn’t hide it, and the public knew.

Over the ensuing years, the men played craps, panguingue, blackjack, poker, tonk, gin rummy and perhaps non-card games like roulette (although one warden denied that) and bet on sports — all using tokens, $0.05, $0.10, $0.25, $0.50, $1 and $5, as currency.

They did so under supervision in the convicts’ recreation area dubbed the bullpen. The inmates didn’t tolerate cheating, which kept the operations honest. As mandated, winners contributed 10 percent of their receipts to the prison’s inmate welfare fund.

Many prisoners passed the time by gambling, which they said prevented tension and conflict among them. Also, it gave the dealers and winners income and prestige.

Though, as in any casino, a fair amount of losing occurred. “Most of them go broke,” said Art Bernard, the warden between 1951 and 1958 (Reno Evening Gazette, Feb. 26, 1957).

Breaking The Rules

Ironically, the prison casino lacked a gambling license, a state requirement of any such operation. It violated Nevada gaming law, too, by dealing with “persons of notorious or unsavory reputation or who have extensive police records,” noted columnist Frank Johnson (Nevada State Journal, Jan. 9, 1960). “On the plus side,” he added, “one can say not only all employees, but all patrons as well, have their fingerprints on file with the authorities. And the gaming IS conducted in a location that is ‘easy to police.’”

The fun, however, ended 35 years later, in 1967, when Warden Carl Hocker put a permanent kibosh on the casino and brass.

“I think gambling in prison is degrading, and it’s certainly not constructive,” he said (Nevada State Journal, May 7, 1967). “We’re trying to replace it with constructive, wholesome activities that will contribute to a decent, healthful frame of mind.”

Do you suppose the prisoners then took their gambling underground and switched the currency to something else?

Sources

1965

The U.S. suffered a shortage of coins in 1965. And that led to decreased business for Nevada’s largest industry — gambling. Usage of half-dollars, common in casinos then for table games and one-armed bandits, experienced the biggest hit.

That year, silver supply was scarce and its price high, at $1.29 per ounce. At $1.38, it would’ve become profitable to melt coins for their silver content, a situation the U.S. Treasury feared. Another concern was running out of the metal for currency. To counteract these problems, President Lyndon B. Johnson signed The Coinage Act, which reduced the 90 percent silver content of three national coins:

• New dimes and quarters were to contain 0 percent
• New half-dollars were to contain 40 percent
• Pennies, nickels and dollars would remain the same; production of dollars would cease

Consequently, people hoarded the coins. This, along with the growth in vending machines, collecting and economic activity, led to the shortage. Half-dollars were affected significantly, as often they were needed for juke boxes, newspaper stands, Laundromats, parking lot ticket machines, parking meters, payphones and bus fare. Additionally, many Americans desired to own the commemorative half-dollar showcasing President John F. Kennedy, minting of which had begun the prior year.

Desperate Measures

Nevada had to take action quickly to ensure gambling stayed as busy as possible. So the legislature approved a law allowing for use of Nevada Gaming Commission (NGC)-approved tokens in casinos. Then the Nevada Gaming Control Board (NGCB) drafted regulations and requested their passage “under emergency provisions for the immediate preservation of the good order and general welfare of the state and the gaming industry,” as noted in the Reno Evening Gazette (Aug. 18, 1965).

The NGC approved those rules, allowing casino patrons to use metal tokens in slot machines and plastic or paper chips of less than $1 value on gambling tables. The tokens, however, had to be:

• Approved first by the NGCB
• Clearly identified by the casino that issued them
• Colored differently than white metal
• Sold only upon request of patrons

Also, casinos couldn’t redeem tokens that weren’t their own unless a player received them from a payout on their property.

With those changes, stability soon returned to the Silver State’s gaming sector.

Sources