Iowa collecting more from jackpot winners who owe money to state

Iowa is collecting a larger share of jackpots won by gamblers who owe the government money when they hit it big at the state's casinos.

A change in state law that took effect in July 2010 lowered the threshold from $10,000 to $1,200 that requires casinos and racetracks to check the names of winners against a list of people who owe child support, incomes taxes, outstanding court debts and other obligations.

Records show that since the change, Iowa has recovered more than $5 million in winnings from indebted gamblers, a 15-fold increase, The Des Moines Register reported.

Iowa is one of at least eight states that require casinos to check the names of big winners for debts. Cash is deducted - up to the entire sum of the casino jackpot or racetrack payout - if such debts are flagged.

When the threshold was dropped, the amount collected took off, said Caleb Hunter, deputy director of the Iowa Department of Administrative Services, which oversees the collection program.

Nearly 3,800 gamblers left Iowa casinos with money deducted from their winnings because of government debts during the 22-month stretch ending in April 2012.

Dee Forret, 71, a retiree from Indianola who was playing slot machines at Osceola's Lakeside Casino, told the Register she had no sympathy for jackpot winners who have their winnings confiscated as a result of unpaid government debts.

"I think it is a great idea," she said. "If you are not paying your bills, then at least this would do it."

Casino and racetrack workers are responsible for checking the database when a winner steps up to collect a big payout, said Wes Ehrecke, president of the Iowa Gaming Association, which represents 18 state-regulated casinos.

"There have been occasions where people ask, 'Why are you doing this?' We say, 'Here is the paper. It is not us,'" he said.

The law applies only to the state-run casinos. None of Iowa's three tribal casinos participates in the program, state officials said. American Indian tribes are sovereign, and their casinos are not monitored by state regulators.

The Iowa Lottery has had a similar debt collection process in place since at least the early 1990s. The lottery rules apply to anyone who claims a lottery prize of $100 or more.