Texas Hold’em

In hard-luck Montague County, slot machine operators hit the jackpot


From the outside, Dice’s Pizza and Subs looks like a mom-and-pop delicatessen, perhaps a nice place to grab a meatball sub or a slice of pepperoni pizza. The low-slung brick building sits near a Dairy Queen along the main drag in the small town of Nocona, Texas, just south of the Oklahoma border. On one side of the building is a mural featuring a village of homes nestled in the foothills of a mountain. The scene looks vaguely Mediterranean. Inside, the room is dark and smoky. There are no shakers of Parmesan cheese or crushed red pepper. No red-and-white checkered tablecloths. In fact, there are no dining tables. These days, nobody visits Dice’s to eat pizza or subs. They come here to gamble.

A few months ago, some local entrepreneurs converted Dice’s into a makeshift casino of sorts. Although gambling is still illegal in Texas, local law enforcement agents have chosen to ignore the handful of mini-casinos that have recently popped up here and there throughout the surrounding area of Montague County, roughly 900 square miles of small towns and farmland northwest of Dallas. The police’s “don’t ask, don’t tell†approach has given Dice’s a significant house advantage. The game room can offer its patrons something that the slumping economy all too often cannot: the hope of hitting it big. While other businesses in the county flounder, Dice’s is flourishing off the money of local residents, who are often poor, sometimes desperate, and always willing to ante up for one more shot at a hundred-dollar jackpot.

On a Thursday afternoon in May, about a dozen men and women sit on stools facing upright machines with bright screens surrounded by dark wood consoles. At first glance, the contraptions, which line both sides of the rectangular room, appear to be video games, the room like an arcade. But a closer look won’t reveal any Golden Tee or Deer Hunter games. Instead, each device offers a menu of amusements. With a touch of the screen, the players flip between blackjack, bingo, keno, and games that mimic slot machines. A friendly woman mills about, offering to fetch free sodas. It’s also her job to cash out the winnings—if there are any.

Betty Wright, a soft-spoken, middle-aged woman with a willowy frame, silver nail polish, and round glasses sits in an alcove toward the back. A black tarp covers the windows over her head, blocking out the midday sunshine. The console in front of her is decorated with palm trees, cherries, and “1¢,†designating it as a penny slot machine. It accepts $1, $5, $10, and $20 bills.

Wright is wagering 10 cents a whirl on a game called Cherry Bonus. Every few seconds, she taps a button. The screen catapults into a blur of lemons, cherries, and plums. When the symbols stop, if the fruit matches up correctly along any of eight lines—three vertical, three horizontal, two diagonal—she wins (thus, video slot machines are often called eight-liners). The more she bets, the more she can potentially rack up. At 10 cents a spin, the jackpot hovers at around $50.

Wright is scoring every couple of spins. The amount, usually ranging from 5 to 25 cents, is added to her credit. Despite her seemingly constant success, Wright’s overall stash is dwindling. She could cash out at almost any time. But she won’t. Winning big, she explains, takes patience. “You have to feed the machine until it comes around,†says Wright. “It’s like a computer that operates on a wheel program.†She demonstrates by rolling her hands in a circle. “You play long enough, you can start hitting,†she says.

Wright, who is in her late fifties, has two children, four grandchildren, and works full time as an electronic seamstress at the Montague Boot Company’s factory. Despite her many obligations, she manages to devote much of her spare time to the game room. She says that she comes to Dice’s once a day, everyday, usually for two or three hours.

A few hundred miles south of Nocona, state representatives in Austin debated the future of games such as Cherry Bonus. Faced with an enormous school-budget deficit, Gov. Rick Perry proposed legalizing slot machines (allowing as many as 40,000) as a way to increase revenue without raising property taxes. Members of the Texas House of Representatives sank Perry’s pro-gambling proposal the first time around in early May, but there is too much money involved to ever take the possibility of legalizing slot machines completely off the table. But before lawmakers listen to the siren song of a gambling industry that has invested heavily in campaign contributions and top-dollar lobbyists, they might want to visit Montague County to learn what life is like for lower-income Texans who no longer have to drive to an Indian reservation or fly to Las Vegas to gamble.

Wright, for one, says she enjoys the fruits of Nocona and thinks that slots should be legalized across the state. “I don’t see the harm,†she says. Like most of the regulars, Wright recalls precisely the largest amount she’s ever won on a single spin at Dice’s: $320.56. Her overall accounting—how much she wins or loses in a given week, for example—is less exact. “I win some, and I lose some,†says Wright. “I probably spend a little more in the balance.â€

In Montague County there are no movie theaters, no museums, no bowling alleys, no roller rinks, and few sit-down restaurants. Nevertheless, in addition to Dice’s, there are at least four other mini-casinos operating in the county. Some, like Dice’s, have turned up in vacant storefronts. Others have set up shop in tricked-out trailers.

All of the game rooms open early, usually at 7 a.m., and close late, typically at 4 a.m., from Monday through Saturday with more limited hours on Sunday. According to the sign on its front door, Grandma’s Game Room in Fruitland never closes.

To witness the extent to which the game rooms are tolerated throughout the county, one only has to visit the small town of Montague, which serves as the county seat. The sheriff’s department and the county courthouse sit in the center of town. About a hundred yards away, a narrow pre-fab house rests just off the main road. A whiteboard, decorated with drawings of red cherries, welcomes visitors. Inside, the room is packed with video slot machines. Montague’s elementary school sits directly across the street. The front door of the game room offers a nice view of the children’s playground. The school’s jungle gym offers a nice view of the adult playground. From the steps of the courthouse, you could practically hit the mini-casino with a Frisbee.

According to neighbors, the game room belongs to Edward Fenoglio, a prominent local businessman—though he denies it. Fenoglio belongs to one of the oldest families in Montague County. The Fenoglios trace their roots in the area all the way back to the 1870s, when their ancestors first immigrated to the United States from Italy. Since then, various Fenoglios have represented the county at both the local and state levels. These days, the extended Fenoglio family owns many ventures in the county, including Fenoglio Bail Bonds, Fenoglio Construction Co., and Fenoglio Custom Homes. Edward Fenoglio also owns the local water company.

There are lots of theories circulating around town as to how an illegal game room can survive in such close proximity to a courthouse, an elementary school, and a sheriff’s department. Some folks believe that no one wrangles with the game rooms because of the potential risk of upsetting the Fenoglios: the “one misstep and your shower could dry up†theory.

Fenoglio dismisses the chatter as idle speculation and says that he is no longer in the gambling business. According to Fenoglio, he used to own one mini-casino in Montague, which he says shut down due to a lack of foot traffic. He thinks that the rest of the game rooms will soon fold as well because of rising gas prices. “People here can’t buy gasoline and gamble at the same time,†says Fenoglio. “The kind of people that play these machines don’t have a lot of money to begin with.â€

However, years of economic hardship have done little to dampen the game rooms’ popularity. In fact, the rise of the mini-casinos has coincided with the decline of the county’s fortunes.

According to the most recent data from the U.S. Census Bureau, one out of every seven residents in Montague County currently lives in poverty. In 2000, the average earnings per job in the county was $18,029, which was less than half the statewide average of $37,072. In 2002, roughly 40 percent of the children in Montague County qualified for a free-or reduced-price lunch.

Despite the grim economic data, Montague isn’t the poorest county in Texas, in part because of its rich history in boot manufacturing. For much of the 20th century, the small town of Nocona, with its population of 3,200 people, was known as the “Leather Goods Capital of the Southwest.†Local factories churned out bountiful numbers of cowboy boots, belts, and baseball gloves.

But by the mid-1990s, the demand for Western wear was drying up. At the same time, many boot factories were moving to Mexico and China. The free fall in boot production hit the residents of Nocona particularly hard. In 1999, after nearly 75 years of operation, the Nocona Boot Company factory shut its doors. For years, the factory had been the area’s largest nonagricultural employer. At the time, more than 300 employees were reportedly laid off.

Recently, Nocona’s boot industry has made a minor recovery thanks to the Montague Boot Company, which opened in 2001. But the overall upswing in the local economy has been minimal. In 1990, countywide unemployment rested at 4.3 percent. By 2002, unemployment had increased to 6.3 percent. In the heady days of the 1980s, the Nocona Boot Factory was cranking out around 500,000 pairs of boots each year. These days, the Montague Boot Company is producing roughly 25,000 pairs a year. Accordingly, the website for the Nocona Chamber of Commerce has scaled back the town’s ambitious claim, welcoming visitors to the “Leathergoods Center of North Texas.â€

The decline in boot manufacturing in Montague County has coincided with the rise of two new industries: gambling and methamphetamine production. About the time that the boot factory was shutting down, homespun meth factories began popping up with increasing frequency along the back roads of the county. These days, a local nonprofit organization called PAIN (Parents Against Illegal Narcotics) offers yet another nickname for the county, referring to it as “The #1 place for the manufacturing of methamphetamines.â€

Robert Donald, the vice president of the organization, speculates that the sheriff’s department doesn’t have the manpower to tackle both vices at once. And while the game rooms are a problem, he says, it’s nothing like the havoc that meth is wreaking.

“The sheriff only has a couple of deputies to cover the entire county,†says Donald. “They literally don’t have the resources to do anything about these game rooms right now.â€

It’s no coincidence that both meth labs and game rooms are prospering simultaneously. Suppliers in both fields have succeeded by attracting customers in search of the same basic thing—a cheap blast of stimulation. The New York Times Sunday Magazine recently ran a story about the new wave of video slot machines. Howard Shaffer, the director of Harvard Medical School’s division on addictions, noted that video slot machines affect the brain in the same way as “psychostimulants, like cocaine or amphetamines.â€

In Montague County, social service providers are beginning to recognize the fallout of the game rooms. Edwin Brooks, president of the Ministerial Alliance, a charity made up of local churches, says that he frequently receives phone calls from people asking for help paying their utility bills or buying groceries. Later, Brooks sees the same people with their cars parked outside the game rooms.

“The eight-liners are a trap to catch our local people,†says Brooks. “They don’t have money to go to Las Vegas or Atlantic City, but they can do it right here. They think that if they win, their problems will go away. But instead, their problems are just getting worse.â€

Brooks is quick to point out that the county was facing hard times long before the advent of the game rooms, but he also notes that for certain people, the constant temptation of living near the machines has been overwhelming. “You can see people sitting in there all day long,†says Brooks. “It creates a problem of addiction.â€

The question of what to do about illegal game rooms is not a new one for the Lone Star State.

Video slot machines first snuck into Texas sometime in the 1990s, spreading across the state one truck stop at a time. The games eventually carved out a new niche within the ever-evolving landscape of American gambling: strip-mall game rooms that were downscale and unassuming.

Although the Texas Penal Code prohibits electronic gambling devices, there is an exception for machines with prizes limited to $5 or 10 times the cost of playing the game once, whichever is less. The rule was set up to accommodate arcade games, but game-room operators soon adopted the “fuzzy animal†exemption as their own. Many of the mini-casinos began awarding winnings in the form of tickets that could be turned in for cash and prizes. Eventually, law enforcement officials started calling the game rooms’ bluff. Between 1998 and 2003, the Attorney General’s Special Crimes Division helped seize approximately 2,000 eight-liner machines and $500,000 in illegal proceeds.

The Texas Supreme Court heard two cases last year in which game-room operators essentially doubled down on their “fuzzy animal†card and challenged the state’s right to confiscate their equipment. Both times, they lost. Tom Kelly, a spokesperson for the Attorney General’s office, says that the rulings have made it easier for local law enforcement agencies to shut down game rooms. As a result, the Special Crimes Division no longer assists in the busts. “There should be no more quarrelling about whether this is illegal or not,†says Kelly. “It’s up to the sheriff, the district attorney, and the county attorney to enforce the law.â€

Last year, Wade Shelton, a semi-retired sewing machine mechanic, approached members of the Nocona City Council to protest the game rooms, which were still booming despite the high court’s rulings. “I’ve seen people put $300 or $400 in those machines going after a $50 pot,†says Shelton. “They max out their credit cards. They can’t pay their bills. These people need protection. They can’t do it themselves.â€

In response, Nocona officials passed an ordinance last November declaring eight-liners “a public nuisance†and requiring game-room owners to register and ante up $15 for each machine. One city official, who asked not to be named, says that lackadaisical enforcement has rendered the ordinance ineffective. So far, not a single owner has registered.

In Bowie, a town of roughly 5,200 people on the southern end of the county, city officials succeeded last year in shutting down a numb
r of game rooms. But the video slots
didn’t altogether vanish. Owners reopened the mini-casinos outside the city limits, where the jurisdiction shifts from the Bowie police force to the county sheriff. “We’ve done all we can,†says James Cantwell, the city manager. “The county officials have chosen not to strictly enforce the law.â€

County Attorney Jeb McNew says that he is aware of the problem. In December, he and the district attorney sent a memo to the sheriff’s department reiterating the illegality of eight-liners and encouraging officers to investigate any potential violations in the county. “I have yet to get one offense report on them,†says McNew. “But if it’s going on, shoot, let us know about it.â€

Sheriff Chris Hamilton says that his officers haven’t forwarded any cases to the county attorney because they’ve been too busy fighting the meth labs. “When I get through working my dopers and my burglars and things that seem a little bit more high priority, I’ll invest the money and time it’s going to take to prosecute these guys that are running the eight-liner machines,†says Hamilton. “Quite frankly, I don’t have the time to do it right now.â€

Ostensibly, the Texas Supreme Court’s rulings made it simple for county officials to chase off game rooms. In theory, once a sheriff threatens to confiscate the machines, game room operators will usually shut down their businesses rather than jeopardize tens of thousands of dollars in equipment.

Sheriff Hamilton isn’t so sure. “It’s not like you can just go out and arrest a guy for running it,†explains Hamilton. “It doesn’t work that way. It requires a long and expensive investigation.â€

Sheriff Hamilton says that at some point in the future—he can’t say precisely when—he intends on sending a letter to the game-room owners offering them two weeks to shut down voluntarily or face seizure of their equipment and possible arrest. “What they’ll do then is just move to another county,†Hamilton predicts.

So what’s the hold up? “I will not write that letter until I am prepared, after the two-week period, to fall in and start cracking down,†says the sheriff. “Don’t run a bluff unless you can back it up.â€

In the meantime, rumors continue to circulate that county officials have other reasons for dragging their feet. Hamilton says that neither he nor his deputies have received any payoff from the game-room owners. However, Hamilton believes that the game rooms might be giving money to other civic organizations such as the volunteer fire departments and the veterans associations—just not to the police. “That’s what I’m hearing,†says Hamilton. “But of course, that doesn’t have anything to do with us.â€

Back at Dice’s, Betty Wright polishes off her remaining credits on lucky machine #25. It’s about 2:30 p.m., and Wright has to work tonight at the boot factory. She locates her purse, throws away her can of soda, and says goodbye. On her way out, Wright walks past another of Dice’s regulars, a woman whom everyone calls Ike.

Ike is dressed in a turquoise top, shorts, and canvas sneakers with a funky floral print. She is sitting in the corner, playing video poker, smoking a cigarette, and drinking soda from a Styrofoam cup. “I like to play poker,†says Ike. “It’s more of a challenge. It takes more skill.â€

A few years ago, Ike moved with her husband to Nocona from San Francisco to be closer to her son. Ike says that lawmakers in Austin should make video poker legal across the state—especially in places like Nocona. “What else do people have to do here?†she says. “Nothing. This is my entertainment. We don’t go out to dinner. There’s no movie theater. It’s my pastime.â€

Ike suggests that the game rooms offer an escape from the tedium of small-town life and, perhaps, from something else—loneliness. Ike says that she misses San Francisco, and she misses her son. Not long after she moved to Nocona, he moved to Dallas to be closer to his job. “I never see him now anyway,†says Ike.

Sometimes Ike comes to the game room with her husband, but he’s on oxygen and can’t stay for long. Since most of her friends live back in San Francisco, Ike usually arrives by herself, which is fine. Video slots are meant to be played alone. “People are nice in here,†says Ike. “You can forget about your problems and your stress.

“Now they have hot dogs,†she adds, gesturing across the room at the all-you-can-eat snack buffet. “Even if you get hungry, you don’t have to leave.â€

Felix Gillette currently gambles with his livelihood as an Austin-based freelancer.