HF 1519

2nd Engrossment - 89th Legislature (2015 - 2016) Posted on 05/14/2015 04:14pm

A bill for an act
relating to lawful gambling; modifying provisions relating to gambling managers;
providing for certain raffles; increasing prize limits; prescribing local regulation;
amending Minnesota Statutes 2014, sections 349.12, subdivisions 18, 19, by
adding subdivisions; 349.13; 349.163, subdivision 2; 349.167, subdivision 1;
349.173; 349.211, subdivision 1; 349.213, subdivision 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 349.12, is amended by adding a
subdivision to read:

new text begin Subd. 12e. new text end

new text begin Electronic raffle selection system. new text end

new text begin "Electronic raffle selection system"
means a system which uses a board-approved random number generator to select winning
raffle numbers and includes raffle sales devices.
new text end

Sec. 2.

Minnesota Statutes 2014, section 349.12, subdivision 18, is amended to read:

Subd. 18.

Gambling equipment.

"Gambling equipment" means gambling
equipment that is either disposable or permanent gambling equipment.

(a) Disposable gambling equipment includes the following:

(1) bingo hard cards or paper sheets, including linked bingo paper sheets;

(2) paper and electronic pull-tabs;

(3) jar tickets;

(4) paddle tickets and paddle ticket cards;

(5) tipboards and tipboard tickets; and

(6) promotional tickets that mimic a pull-tab or tipboard.

(b) Permanent gambling equipment includes the following:

(1) devices for selecting bingo numbers;

(2) electronic bingo devices;

(3) electronic pull-tab devices;

(4) pull-tab dispensing devices;

(5) programmable electronic devices that have no effect on the outcome of a game
and are used to provide a visual or auditory enhancement of a game;

(6) paddlewheels; deleted text begin and
deleted text end

(7) paddlewheel tables deleted text begin . deleted text end new text begin ; and
new text end

new text begin (8) electronic raffle selection systems.
new text end

Sec. 3.

Minnesota Statutes 2014, section 349.12, subdivision 19, is amended to read:

Subd. 19.

Gambling manager.

"Gambling manager" means a person who has been
designated by the organization to supervise the lawful gambling conducted by it, has been
an active member of the organization for at least the most recent deleted text begin six months deleted text end new text begin 90 days new text end at the
time of the application for a gambling manager license, and meets other qualifications as
prescribed by the board by rule.

Sec. 4.

Minnesota Statutes 2014, section 349.12, is amended by adding a subdivision
to read:

new text begin Subd. 33a. new text end

new text begin Raffle sales device. new text end

new text begin "Raffle sales device" is an attendant-operated
cashier station used as a point of sale for raffle tickets from which a raffle participant may
purchase a raffle ticket.
new text end

Sec. 5.

Minnesota Statutes 2014, section 349.12, is amended by adding a subdivision
to read:

new text begin Subd. 33b. new text end

new text begin Share the pot raffle. new text end

new text begin "Share the pot raffle" means a raffle in which the
prize amount is a percentage of the raffle's gross receipts.
new text end

Sec. 6.

Minnesota Statutes 2014, section 349.13, is amended to read:

349.13 LAWFUL GAMBLING.

Lawful gambling is not a lottery or gambling within the meaning of sections 609.75
to 609.76 if it is conducted under this chapter. A pull-tab dispensing device, electronic
bingo device, and electronic pull-tab device permitted under this chapter and by board
rule is not a gambling device within the meaning of sections 609.75 to 609.76 and chapter
299L. An electronic game device allowed under this chapter may not be a slot machine.
Electronic game devices, including but not limited to electronic bingo devices, electronic
paddlewheels, deleted text begin and deleted text end electronic pull-tab devices new text begin , and electronic raffle selection systems
new text end authorized under this chapter, may only be used in the conduct of lawful gambling
permitted under this chapter and board rule and may not display or simulate any other
form of gambling or entertainment, except as otherwise allowed under this chapter.

Sec. 7.

Minnesota Statutes 2014, section 349.163, subdivision 2, is amended to read:

Subd. 2.

License; fee.

The annual fee for a manufacturer's license is $9,000. new text begin The
annual license fee for manufacturers of only electronic raffle selection systems license
is $1,000.
new text end

Sec. 8.

Minnesota Statutes 2014, section 349.167, subdivision 1, is amended to read:

Subdivision 1.

Gambling manager required.

(a) All lawful gambling conducted by
a licensed organization must be under the supervision of a gambling manager. A gambling
manager designated by an organization to supervise lawful gambling is responsible for the
gambling gross receipts of the organization and for its conduct in compliance with all laws
and rules. A person designated as a gambling manager shall maintain a dishonesty bond in
the sum of $10,000 in favor of the organization conditioned on the faithful performance
of the manager's duties. The terms of the bond must provide that notice be given to the
board in writing not less than 30 days before its cancellation.

(b) new text begin Except as otherwise provided under this paragraph, new text end a person may not act as a
gambling manager for more than one organization. new text begin If a lawful gambling organization loses
its gambling manager or its gambling manager is not capable of performing the duties, and
no organization member is available to perform the duties of gambling manager, an interim
gambling manager from another lawful gambling organization may be appointed by the
organization with a vacancy to fill the vacant gambling manager position. An interim
gambling manager must obtain a license from the board as a gambling manager for the
lawful gambling organization with a vacancy. An interim gambling manager license shall
not be valid for more than 120 days. A gambling manager serving as an interim gambling
manager under this paragraph is not required to be a member of the lawful gambling
organization with a vacancy at the time the interim gambling manager begins service to the
organization with a vacancy. The fee for an interim gambling manager's license is $100.
new text end

(c) An organization may not conduct lawful gambling without having a gambling
manager.

(d) An organization may not have more than one gambling manager at any time.

Sec. 9.

Minnesota Statutes 2014, section 349.173, is amended to read:

349.173 CONDUCT OF RAFFLES.

(a) Raffle tickets or certificates of participation at a minimum must list the three
most expensive prizes to be awarded and include the location, date, and time of the
selection of the winning entries. If additional prizes will be awarded, a complete list of
additional prizes must be publicly posted at the event and copies of the complete prize list
made available upon request. Raffles conducted under the exemptions in section 349.166
may use tickets that contain only the sequential number of the raffle ticket and no other
information if the organization makes a list of prizes and a statement of other relevant
information required by rule available to persons purchasing tickets and if tickets are only
sold at the event and on the date when the tickets are drawn.

(b) Raffles must be conducted in a manner that ensures:

(1) all entries in the raffle have an equal chance of selection;

(2) entry in the raffle is not conditioned upon any other purchase, except that a
certificate of participation may be a button with a nominal value of less than $5;

(3) the method of selection is conducted in a public forum;

(4) the method of selection cannot be manipulated or based on the outcome of an
event not under the control of the organization;

(5) physical presence at the raffle is not a requirement to win; and

(6) all sold and unsold tickets or certificates of participation are accounted for.

(c) An organization that is permitted under this section and authorized by the
Gambling Control Board to conduct raffles may conduct a raffle in conjunction with a wild
game or fish taking event. The wild game or fish must be legally taken under chapters 97A
to 97C, and rules adopted pursuant to those chapters. The organization may sell a combined
ticket for a single price for the event and raffle, provided that the combined ticket states
the amount of the price that applies to the wild game or fish event, and the amount that
applies to the raffle. All other provisions of sections 349.11 to 349.23 apply to the raffle.

(d) Methods of selecting winning entries from a raffle other than prescribed in rule
may be used with the prior written approval of the board.

new text begin (e) For raffles conducted by a licensed organization, the entries may be selected by
use of a board-approved random number generator if, at the time of sale, the number
contained on the raffle ticket is captured by the electronic raffle selection system and
electronically recorded as an entry in the raffle.
new text end

new text begin (f) The board may by rule authorize but not require the use of electronic raffle
selection systems.
new text end

new text begin (g) The board may by rule adopt minimum technical standards for electronic raffle
selection systems.
new text end

Sec. 10.

Minnesota Statutes 2014, section 349.211, subdivision 1, is amended to read:

Subdivision 1.

Bingo.

Except as provided in subdivisions 1a and 2, prizes for a
single bingo game may not exceed deleted text begin $200 deleted text end new text begin $500 new text end except prizes for a cover-all game, which
may exceed deleted text begin $200 deleted text end new text begin $500 new text end if the aggregate value of all cover-all prizes in a bingo occasion
does not exceed deleted text begin $1,000 deleted text end new text begin $2,000 new text end . Total prizes awarded at a bingo occasion may not exceed
deleted text begin $2,800 deleted text end new text begin $5,000 new text end , unless a cover-all game is played in which case the limit is deleted text begin $3,800 deleted text end new text begin $7,000 new text end .
A prize may be determined based on the value of the bingo packet sold to the player. For
purposes of this subdivision, a cover-all game is one in which a player must cover all
spaces except a single free space to win and includes a game in which all odd or all even
numbers are designated by the organization as covered prior to the start of the game.

Sec. 11.

Minnesota Statutes 2014, section 349.213, subdivision 1, is amended to read:

Subdivision 1.

Local regulation.

(a) A statutory or home rule city or county has the
authority to adopt more stringent regulation of lawful gambling within its jurisdiction,
including the prohibition of lawful gambling.

(b) A statutory or home rule city or county may require a permit for the conduct
of gambling exempt from licensing under section 349.166. The fee for a permit issued
under section 349.166 may not exceed $100.

(c) The authority granted by this subdivision does not include the authority to require
a license or fee for a license or permit to conduct gambling by organizations, gambling
managers, gambling employees, or sales by distributors or linked bingo game providers
licensed by or registered with the board.

(d) The authority granted by this subdivision does not include the authority to require
an organization to make specific expenditures of more than ten percent per year from its
net profits derived from lawful gambling.

(e) For the purposes of this subdivision, net profits are gross profits less amounts
expended for allowable expenses and paid in taxes assessed on lawful gambling.

(f) A statutory or home rule charter city or a county may not require an organization
conducting lawful gambling within its jurisdiction to make an expenditure to the city or
county as a condition to operate within that city or county, except:

(1) as authorized under section 349.16, subdivision 8, or 297E.02; or

(2) by an ordinance requirement that such organizations must contribute ten percent
per year of their net profits derived from lawful gambling conducted at premises within
the city's or county's jurisdiction to a fund administered and regulated by the responsible
local unit of government without cost to such fund. The funds must be disbursed by the
local unit of government for (i) charitable contributions as defined in section 349.12,
subdivision 7a, or (ii) police, fire, and other emergency or public safety-related services,
equipment, and training, excluding pension obligations. A contribution made by an
organization is not considered an expenditure to the city or county nor a tax under section
297E.02, and is valid and lawful. A city or county receiving and making expenditures
authorized under this clause must by March 15 of each year file a report with the board, on
a form the board prescribes, that lists all such revenues collected, interest received on fund
balances, and expenditures for the previous calendar year. new text begin A home rule or statutory city or
county making charitable contributions authorized under this clause must acknowledge
financial contributions of organizations conducting lawful gambling to the community
and to the recipients of the funds. This may occur in communications about the funds as
well as in the distribution of funds.
new text end

(g) A statutory or home rule city or county may by ordinance require that a licensed
organization conducting lawful gambling within its jurisdiction expend all or a portion
of its expenditures for lawful purposes on lawful purposes conducted or located within
the city's or county's trade area. Such an ordinance must be limited to lawful purpose
expenditures of gross profits derived from lawful gambling conducted at premises within
the city's or county's jurisdiction, must define the city's or county's trade area, and must
specify the percentage of lawful purpose expenditures which must be expended within the
trade area. A trade area defined by a city under this subdivision must include each city and
township contiguous to the defining city.

(h) A more stringent regulation or prohibition of lawful gambling adopted by a
political subdivision under this subdivision must apply equally to all forms of lawful
gambling within the jurisdiction of the political subdivision, except a political subdivision
may prohibit the use of paddlewheels.

Sec. 12. new text begin EFFECTIVE DATE.
new text end

new text begin This act is effective the day following final enactment.
new text end