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Minnesota Legislature

Office of the Revisor of Statutes

SF 1978

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to gambling; providing for the operation of
lottery gaming machines and the conduct of lottery and
nonlottery games at a gaming facility; licensing the
gaming facility and imposing a license fee; imposing a
gaming transaction fee on gaming at the gaming
facility; amending Minnesota Statutes 2004, sections
297A.94; 299L.07, subdivisions 2, 2a; 340A.410,
subdivision 5; 349A.01, subdivision 10, by adding
subdivisions; 349A.04; 349A.10, subdivisions 3, 6;
349A.13; 541.20; 541.21; 609.75, subdivision 3;
609.761, by adding a subdivision; proposing coding for
new law in Minnesota Statutes, chapters 297A; 299L;
349A.

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

ARTICLE 1

PURPOSE

Section 1. new text beginPURPOSE.
new text end

new text begin The purpose of this act is to:
new text end

new text begin (1) recognize the significant inequities created by the
current status of casino gaming in Minnesota given the extreme
disparity in revenues generated by tribal casinos for
Minnesota's Indian tribes and tribal members and the lack of any
significant direct revenue to the state of Minnesota;
new text end

new text begin (2) provide an opportunity for increased economic
development and tribal self-sufficiency to tribal governments
which, because of their locations and tribal populations, have
not benefited significantly from gaming opportunities under the
federal Indian Gaming Regulatory Act, United States Code, title
25, sections 2701 to 2721;
new text end

new text begin (3) provide for the generation of revenues to the state,
including proceeds for distribution as set forth in the
Minnesota Constitution, article XI, section 14; and
new text end

new text begin (4) establish a structure that promotes tribal sovereignty
and self-governance and that provides revenues from casino
gaming to tribal governments for the development of programs to
alleviate persistent poverty conditions and to advance tribal
goals.
new text end

ARTICLE 2

LOTTERY OPERATIONS

Section 1.

Minnesota Statutes 2004, section 349A.01,
subdivision 10, is amended to read:


Subd. 10.

Lottery procurement contract.

"Lottery
procurement contract" means a contract to provide lottery
products, new text begingaming machines, maintenance of gaming machines,
new text end computer hardware and software used to monitor sales of lottery
tickets new text beginand gaming machine plays, equipment used to conduct and
monitor other lottery games at a gaming facility, equipment used
for the conducting of other lottery games
new text end, and lottery tickets.
"Lottery procurement contract" does not include a contract to
provide an annuity or prize payment agreement or materials,
supplies, equipment, or services common to the ordinary
operation of a state agency.

Sec. 2.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 14. new text end

new text begin Gaming facility. new text end

new text begin "Gaming facility" means the
site selected for the location of gaming machines and the
conduct of other lottery games pursuant to a location contract
under section 349A.17 and nonlottery casino games pursuant to a
plan of operation approved under section 299L.094.
new text end

Sec. 3.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 15. new text end

new text begin Gaming machine. new text end

new text begin "Gaming machine" means any
machine, system, or device which, upon payment of consideration
in order to play a game, may award or entitle a player to a
prize by reason of skill of the player or application of the
element of chance, or both.
new text end

Sec. 4.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 16. new text end

new text begin Gaming machine game. new text end

new text begin "Gaming machine game"
means a game operated by a gaming machine as authorized by the
director.
new text end

Sec. 5.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 17. new text end

new text begin Gaming machine play. new text end

new text begin "Gaming machine play"
means a record that proves participation in a gaming machine
game.
new text end

Sec. 6.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 18. new text end

new text begin Adjusted gross gaming machine
revenue.
new text end

new text begin "Adjusted gross gaming machine revenue" means the sum
of all money received for gaming machine plays less the amount
paid out in prizes and for gaming machine games and promotional
allowances approved by the director under section 349A.17.
new text end

Sec. 7.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 19. new text end

new text begin Other lottery game. new text end

new text begin "Other lottery game" means
any game operated by the lottery at the gaming facility other
than a gaming machine, where money or property are distributed
to persons selected primarily by chance from among participants
who have paid for a chance of being selected and any other game
or activity determined to constitute a lottery within the
meaning of the Minnesota Constitution, article XIII, section 5.
Other lottery games do not include lottery games that are
operated by the lottery at the gaming facility that are also
sold by lottery retailers.
new text end

Sec. 8.

Minnesota Statutes 2004, section 349A.01, is
amended by adding a subdivision to read:


new text begin Subd. 20. new text end

new text begin Other lottery games adjusted gross
revenue.
new text end

new text begin "Other lottery games adjusted gross revenue" means the
sum of all money from the operation of other lottery games at
the gaming facility, less the amount paid out in prizes in the
other lottery games and promotional allowances paid by the
tribal entity under section 349A.17 and approved by the director.
new text end

Sec. 9.

Minnesota Statutes 2004, section 349A.04, is
amended to read:


349A.04 LOTTERY GAME PROCEDURES.

The director may adopt game procedures governing the
following elements of the lottery:

(1) lottery games;

(2) ticket prices;

(3) number and size of prizes;

(4) methods of selecting winning tickets; deleted text beginand
deleted text end

(5) frequency and method of drawingsnew text begin;
new text end

new text begin (6) gaming machine games;
new text end

new text begin (7) cost of gaming machine plays;
new text end

new text begin (8) other lottery games; and
new text end

new text begin (9) cost to participate in other lottery gamesnew text end.

The adoption of lottery game procedures is not subject to
chapter 14.

Sec. 10.

Minnesota Statutes 2004, section 349A.10,
subdivision 3, is amended to read:


Subd. 3.

Lottery operations.

(a) The director shall
establish a lottery operations account in the lottery fund. The
director shall pay all costs of operating the lottery, including
payroll costs or amounts transferred to the state treasury for
payroll costs, but not including lottery prizes, from the
lottery operating account. The director shall credit to the
lottery operations account amounts sufficient to pay the
operating costs of the lottery.

(b) Except as provided in paragraph (e), the director may
not credit in any fiscal year thereafter amounts to the lottery
operations account which when totaled exceed 15 percent of gross
revenue to the lottery fund in that fiscal year. In computing
total amounts credited to the lottery operations account under
this paragraph the director shall disregard amounts transferred
to or retained by lottery retailers as sales commissions or
other compensation new text beginand amounts transferred to or retained by the
tribal entity pursuant to a location contract under section
349A.17
new text end.

(c) The director of the lottery may not expend after July
1, 1991, more than 2-3/4 percent of gross revenues in a fiscal
year for contracts for the preparation, publication, and
placement of advertising.

(d) Except as the director determines, the lottery is not
subject to chapter 16A relating to budgeting, payroll, and the
purchase of goods and services.

(e) In addition to the amounts credited to the lottery
operations account under paragraph (b), the director is
authorized, if necessary, to meet the current obligations of the
lottery and to credit up to 25 percent of an amount equal to the
average annual amount which was authorized to be credited to the
lottery operations account for the previous three fiscal years
but was not needed to meet the obligations of the lottery.

new text begin (f) Notwithstanding the provisions of this subdivision, the
director may not credit, in any fiscal year, to the lottery
operations account ............ which when totaled exceed ten
percent of adjusted gross revenue from the operation of gaming
machines and other lottery games at the gaming facility.
new text end

Sec. 11.

Minnesota Statutes 2004, section 349A.10,
subdivision 6, is amended to read:


Subd. 6.

Budget; plans.

The director shall prepare and
submit a biennial budget plan to the commissioner of finance.
The governor shall recommend the maximum amount available for
the lottery in the budget the governor submits to the
legislature under section 16A.11. The maximum amount available
to the lottery for operating expenses and capital expenditures
shall be determined by law. Operating expenses shall not
include expenses that are a direct function of lottery sales,
which include the cost of lottery prizes, amounts paid to
lottery retailers as sales commissions or other compensation,
amounts paid to produce and deliver scratch lottery games, deleted text beginand
deleted text end amounts paid to an outside vendor to operate and maintain an
online gaming systemnew text begin, amounts paid to an outside vendor to
operate and maintain a central system for gaming machines and
for other lottery games, and amounts paid to acquire and
maintain gaming machines and equipment used to conduct other
lottery games
new text end. In addition, the director shall appear at least
once each fiscal year before the senate and house of
representatives committees having jurisdiction over gambling
policy to present and explain the lottery's plans for future
games and the related advertising and promotions and spending
plans for the next fiscal year.

Sec. 12.

Minnesota Statutes 2004, section 349A.13, is
amended to read:


349A.13 RESTRICTIONS.

Nothing in this chapter:

(1) authorizes the director to conduct a lottery game or
contest the winner or winners of which are determined by the
result of a sporting event other than a horse race conducted
under chapter 240;

(2) authorizes the director to install or operate a lottery
device operated by coin or currency which when operated
determines the winner of a game new text beginexcept as authorized under
section 349A.17
new text end; and

(3) authorizes the director to sell pull-tabs as defined
under section 349.12, subdivision 32.

Sec. 13.

new text begin [349A.17] GAMING FACILITY.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this
section, the terms defined in this subdivision have the meanings
given them.
new text end

new text begin (b) "Tribal entity" means one or more entities, whether
tribally or federally chartered corporations, or other legal
entities, wholly owned by one or more tribal governments that
are parties to the location contract under this section.
new text end

new text begin (c) "Tribal government" means the governmental entity that
represents one of the 11 federally recognized Indian tribes
within the state of Minnesota.
new text end

new text begin (d) "Site" means a parcel or contiguous parcels of land,
and may be enlarged by the addition of contiguous parcels of
land over time.
new text end

new text begin Subd. 2. new text end

new text begin Location contract. new text end

new text begin (a) The director may enter
into a contract with a tribal entity to provide locations for
the operation of gaming machines and other lottery games at one
site located in the seven-county metropolitan area as defined in
section 473.121, subdivision 2, or any contiguous county
thereto. The site for the gaming facility shall be jointly
selected by the director and the tribal entity. Upon
notification by the director that the gaming facility will be
located in a particular city, the home rule charter or statutory
city has 60 days after the notification to adopt a resolution
that it does not consent to being considered as a site under
this subdivision. Upon receipt of the notification by the home
rule charter or statutory city, the director shall not consider
that city as a site for the facility.
new text end

new text begin (b) The director may enter a location contract with a
tribal entity that meets the following criteria:
new text end

new text begin (1) the tribal entity must be comprised of tribal
governments which are each federally recognized tribes which
operate current casino gaming operations under the federal
Indian Gaming Regulatory Act, United States Code, title 25,
sections 2701 to 2721, pursuant to a compact with the state of
Minnesota;
new text end

new text begin (2) to be eligible to participate in the tribal entity, the
tribal government must demonstrate to the director that the
revenues available to the tribal government from currently
available revenue sources are insufficient to adequately meet
the basic needs of tribal members including, but not limited to,
housing, medical care, education, or other governmental services
to members;
new text end

new text begin (3) each of the tribal governments participating in the
tribal entity must within 30 days following final enactment of
this act file with the director a formal resolution from its
tribal council which provides that:
new text end

new text begin (i) the tribal government intends to participate in a
tribal entity which will enter a contract that complies with the
requirements of this act;
new text end

new text begin (ii) the tribal government meets the eligibility criteria
set forth in this paragraph and provides adequate documentation
to supports its eligibility to participate in the tribal entity;
new text end

new text begin (iii) a statement of the tribal government's intent to
participate in a tribal entity that waives the entity's
sovereign immunity relating to disputes arising out of the
location contract or the construction, management, or operation
of the gaming facility and that the tribal government expressly
consents that the tribal entity will be subject to the
jurisdiction of the state court and the administrative and
regulatory jurisdiction of the state. The resolution must also
include a limited waiver of sovereign immunity and consent by
the tribal government to the jurisdiction of state court solely
to resolve disputes alleging that assets have been transferred
from the tribal entity to the tribe in violation of the location
contract or other applicable law and limited to any improperly
transferred assets; and
new text end

new text begin (iv) states the intention of the tribal government to
ensure that revenues provided to the participating tribal
governments from the tribal entity will be distributed between
the participating tribal governments in a fair and equitable
manner as determined solely by the participating tribal
governments.
new text end

new text begin (c) The location contract shall have no legal effect on the
validity of existing tribal-state gaming compacts.
new text end

new text begin (d) A contract signed with a tribal entity under this
section shall run for not more than 20 years and shall be
negotiable and renewable every 15 years thereafter. The state,
tribal entity, or participating tribal government that intends
to not renegotiate and renew the location contract must, if
reasonably possible, provide notice of its intent to the other
parties at least one year before the location contract expires.
A tribal government participating in the tribal entity may opt
out of this arrangement as part of the renewal process without
affecting the ability of the tribal entity to renew the contract
with the participation of the remaining tribal governments.
new text end

new text begin (e) The contract entered into under this section must
provide for the following provisions:
new text end

new text begin (1) The waiver of sovereign immunity by the tribal entity
and the limited waiver of sovereign immunity by the tribal
governments consistent with paragraph (b).
new text end

new text begin (2) Liquidated damages to recover the initial investment by
the tribal entity in the event the state, through legislation or
constitutional amendment, revokes all or substantially all of
the forms of gambling authorized under this section. The
liquidated damages may not be greater than the unpaid balance of
any debt incurred by the tribal entity after the location
contract has been executed and is limited to the debt incurred
by the tribal entity for the gaming facility license, initial
construction, or acquisition of the gaming facility less the
present market value of the property or other assets related to
the debt. Any liquidated damages provision must expire within
ten years.
new text end

new text begin (3) The tribal entity, in the construction of the gaming
facility, and the subsequent repair and maintenance of the
facility, shall make good faith efforts to contract with
American Indian and minority-owned businesses.
new text end

new text begin (4) The tribal entity, in operating the gaming facility,
shall make good faith efforts to ensure that American Indians
and other minorities are employed in entry level, middle
management, and upper management positions.
new text end

new text begin (5) Payment of a fee to the tribal entity equal to 64
percent of the adjusted gross gaming machine revenue and other
lottery games adjusted gross revenue.
new text end

new text begin (6) All costs associated with managing the day-to-day
activity of gaming machines and other lottery games, including,
but not limited to, routine and minor service and maintenance,
security monitoring, verifying winners, paying winners,
collecting money from gaming machines, collecting wagers from
the operation of other lottery games, and advertising and
marketing of gaming machines and other lottery games shall be
borne by the tribal entity.
new text end

new text begin (7) All costs associated with purchase or lease of gaming
machines and costs associated with major maintenance of the
gaming machines shall be borne by the lottery.
new text end

new text begin (8) The tribal entity shall pay to the commissioner of
human services an annual amount equal to the lesser of 0.5
percent of adjusted gross gaming machine revenue, other lottery
games' adjusted gross income, and nonlottery casino games'
adjusted gross revenue or $2,500,000, for problem and compulsive
gambling treatment or programs.
new text end

new text begin (9) The tribal entity shall pay an annual amount equal to
two percent of adjusted gross gaming machine revenue, other
lottery games' adjusted gross income, and nonlottery casino
games' adjusted gross revenue to the city and county where the
gaming facility is located. This payment is in lieu of an
obligation to pay any portion of local property taxes
attributable to the city and county. The tribal entity is still
responsible for payment of the portion of local property taxes
attributable to the appropriate school district.
new text end

new text begin (10) Any controversy or claim between the tribal entity and
the director arising out of the location contract may be settled
by arbitration except as provided in paragraphs (g) and (h).
new text end

new text begin (11) The tribal entity must maintain adequate liability and
casualty insurance for the gaming facility.
new text end

new text begin (f) The tribal entity may establish reasonable standards
for payment of promotional allowances to players and the
proportional allocation of promotional allowances between
revenue generated from gaming machines, other lottery games, and
nonlottery casino games. Upon approval of the standards for
promotional allowances, the director shall reimburse the tribal
entity for the cost of promotional allowances paid by the tribal
entity.
new text end

new text begin (g) As part of the location contract, the director may
authorize the operation of gaming machines and the conduct of
other lottery games at a temporary facility pending completion
of a permanent facility and may establish reasonable conditions
for the operation. The operation of gaming machines and the
conducting of other lottery games at a temporary facility shall
be treated in the same manner as if it was conducted in a
permanent facility.
new text end

new text begin (h) The director may by administrative action cancel or
suspend the location contract if the director reasonably
determines that the tribal entity has materially breached any
material provision of the location contract and has failed to
cure that breach in a reasonable time, or if the tribal entity's
gaming facility license has been suspended or revoked by the
commissioner of public safety.
new text end

new text begin A contract cancellation or suspension under this paragraph
is a contested case under sections 14.57 to 14.69 and is in
addition to any criminal penalties provided for a violation of
law or rule.
new text end

new text begin (i) The director may by administrative action impose a
civil penalty, issue correction orders, or resolve in any other
manner as determined appropriate by the director, if the
director determines that the tribal entity has breached any term
of the location contract. The imposition of a civil penalty is
a contested case under sections 14.57 to 14.69 and is in
addition to any criminal penalties provided for a violation of
law or rule.
new text end

new text begin (j) The rights and interests provided by the location
contract are specific to the state and the tribal entity and are
not transferable without the written approval of the director.
new text end

new text begin (k) Gaming machines may only be placed and other lottery
games may only be conducted at a gaming facility that is owned
or leased by the tribal entity.
new text end

new text begin (l) The contract entered into under this subdivision is not
subject to chapter 16C.
new text end

new text begin (m) The amount paid by the tribal entity to the
commissioner of human services pursuant to the location contract
under this section is annually appropriated to the commissioner
of human services for problem and compulsive gambling treatment
or programs, including programs that are designed to address
compulsive gambling in American Indian and minority communities.
new text end

new text begin Subd. 3. new text end

new text begin Operation. new text end

new text begin (a) All gaming machines that are
placed at a gaming facility or other lottery games conducted at
the gaming facility must be operated and controlled by the
director.
new text end

new text begin (b) Gaming machines must be owned or leased by the director.
new text end

new text begin (c) Major maintenance of the gaming machines shall be
controlled by the director or by a vendor that is under the
control and direction of the director.
new text end

new text begin (d) The director must have a central communications system
that monitors activities on each gaming machine.
new text end

new text begin (e) Equipment used to conduct other lottery games at the
gaming facility must be owned or leased by the director.
new text end

new text begin (f) The director must approve the general security
arrangements associated with and relating to the operation of
the gaming machines and the conducting of other lottery games at
the gaming facility.
new text end

new text begin (g) Advertising and promotional material produced by the
gaming facility relating to gaming machines and the conduct of
other lottery games at the gaming facility must be approved by
the director in a timely manner.
new text end

new text begin (h) The director may authorize the tribal entity to manage
the day-to-day operation of the gaming machines and the
conducting of other lottery games at the gaming facility,
provided that the director shall maintain overall control of the
operation of the gaming machines and the conducting of other
lottery games at the gaming facility.
new text end

new text begin (i) The costs associated with procuring and maintaining
gaming machines and equipment involved in operating other
lottery games, and costs associated with acquiring, maintaining,
and operating the central system used to monitor the activity of
gaming machines, shall be borne by the lottery.
new text end

new text begin (j) All proceeds from the operation of gaming machines and
conduct of other lottery games received by the tribal entity
constitute a trust fund until transmitted to the director.
new text end

new text begin (k) The director may require the tribal entity to deposit
in an account in a designated bank all money received by the
tribal entity from the operation of gaming machines and the
conduct of other lottery games.
new text end

new text begin (l) If the tribal entity fails to pay any money due the
director within the time prescribed by the director, the tribal
entity shall pay interest on the amount owed at the rate set for
lottery retailers under Minnesota Rules, part 7856.7020.
new text end

new text begin (m) The director may implement policies, procedures, and
other controls that are determined to be necessary by the
director for the operation of gaming machines and the conducting
of other lottery games pursuant to this section.
new text end

new text begin Subd. 4. new text end

new text begin Games. new text end

new text begin The director shall specify the games
that may be played on a gaming machine and the manner in which
other lottery games are conducted at the gaming facility as set
forth under section 349A.04.
new text end

new text begin Subd. 5. new text end

new text begin Specifications. new text end

new text begin Gaming machines must:
new text end

new text begin (1) maintain on non-resettable meters a permanent record
capable of being printed out, of all transactions by the machine
and all entries into the machine; and
new text end

new text begin (2) be capable of being linked to a central communications
system to provide auditing program information as required by
the director.
new text end

new text begin Subd. 6. new text end

new text begin Examination of machines. new text end

new text begin The director shall
examine prototypes of gaming machines and require that the
manufacturer of the machine pay the cost of the examination.
The director may contract for the examination of gaming
machines. The director may require working models of a gaming
machine transported to the locations the director designates for
testing, examination, and analysis. The manufacturer shall pay
all costs of any testing, examination, analysis, and
transportation of the machine model.
new text end

new text begin Subd. 7. new text end

new text begin Prizes. new text end

new text begin A person who plays a gaming machine or
plays any other lottery game at the gaming facility agrees to be
bound by the rules and game procedures applicable to that
particular game. The player acknowledges that the determination
of whether the player has won a prize is subject to the rules
and game procedures adopted by the director, claim procedures
established by the director for that game, and any confidential
or public validation tests established by the director for that
game. A person under 18 years of age may not claim a prize from
the operation of a gaming machine or the conducting of any other
lottery game at the gaming facility. A prize claimed from the
play of a gaming machine game or the conduct of any other
lottery game is not subject to section 349A.08, subdivision 8.
new text end

new text begin Subd. 8. new text end

new text begin Prohibitions. new text end

new text begin A person under the age of 18
years may not play a game on a gaming machine or participate in
any other lottery game at the gaming facility.
new text end

new text begin Subd. 9. new text end

new text begin Compulsive gambling notice. new text end

new text begin The tribal entity
shall prominently post, in areas of the gaming facility where
gaming machines are located or where other lottery games are
conducted, the toll-free telephone number established by the
commissioner of human services in connection with the problem
and compulsive gambling program. The tribal entity shall
establish, with the approval of the director, a proactive plan
relating to problem and compulsive gambling.
new text end

new text begin Subd. 10. new text end

new text begin Local licenses; local fees. new text end

new text begin A political
subdivision may not require a license to operate a gaming
machine or conduct other lottery games or nonlottery casino
games as defined under section 299L.093, restrict or regulate
the placement of gaming machines or the conducting of other
lottery or nonlottery casino games, or impose a tax or fee on
the business of operating gaming machines or the conducting of
other lottery or nonlottery casino games at the gaming facility.
new text end

new text begin Subd. 11. new text end

new text begin Data classification. new text end

new text begin In performing the
responsibilities and duties required by this section, the
director and the lottery shall receive, collect, and create data
that reflects the internal operations of the gaming machines,
and other lottery games that are proprietary in nature
including, but not limited to, information regarding placement
or operation of machines and games, gaming receipts from
specific machines and games, payouts for specific games and
machines, and other business and operational decisions relating
to profitability and competitive advantage. This data is
classified as nonpublic data under section 13.02, subdivision
9. The director may provide the tribal entity, the management
entity, or a vendor that is providing gaming machines at the
gaming facility with access to any part of this data pursuant to
an appropriate confidentiality agreement between the director
and the appropriate party.
new text end

Sec. 14. new text beginLOTTERY BUDGET; GAMING FACILITY.
new text end

new text begin The director of the State Lottery shall submit a budget for
the operation of gaming machines and for the conduct of other
lottery games at a gaming facility as authorized under Minnesota
Statutes, section 349A.17, to the commissioner of finance.
Notwithstanding Minnesota Statutes, section 349A.10, subdivision
6, the director of the State Lottery may expend amounts
necessary to operate gaming at the gaming facility. Amounts
expended by the director of the State Lottery for the conducting
of gaming at the gaming facility in fiscal years 2006 and 2007
are not subject to the maximum amount set in law for the
operation of the lottery.
new text end

Sec. 15. new text beginEFFECTIVE DATE.
new text end

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

ARTICLE 3

GAMING FACILITY REGULATION

Section 1.

new text begin [299L.09] GAMING FACILITY.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin For the purposes of this
section and sections 299L.09 to 299L.095, the following terms
have the meanings given them.
new text end

new text begin (a) "Direct financial interest" means ownership or control
of at least five percent interest in the tribal entity or
management entity, the debt, or other financial interest in the
tribal entity or management entity.
new text end

new text begin (b) "Lottery director" means the director of the Minnesota
State Lottery under chapter 349A.
new text end

new text begin (c) "Tribal entity" is as defined in section 349A.17.
new text end

new text begin (d) "Management entity" means the entity applying for or
holding a management license under section 299L.092.
new text end

new text begin Subd. 2. new text end

new text begin License required. new text end

new text begin The tribal entity that will
own and operate, whether directly or through another tribal or
management entity, a gaming facility under section 349A.17 must
obtain a gaming facility license from the commissioner.
new text end

new text begin Subd. 3. new text end

new text begin Application. new text end

new text begin An application for a license under
this section must be on a form prescribed by the commissioner.
The commissioner may issue a gaming facility license to the
tribal entity that will operate the gaming facility.
new text end

new text begin Subd. 4. new text end

new text begin License fee. new text end

new text begin Upon issuance of the license, the
tribal entity must pay a onetime license fee of $200,000,000 to
the commissioner.
new text end

new text begin Subd. 5. new text end

new text begin License issuance. new text end

new text begin (a) The commissioner shall
issue a license under this section unless information obtained
from the comprehensive background check establishes that
issuance of the license would be adverse to the public interest
or to the effective regulation of gaming. If a license
application is denied, the tribal entity may reapply for a
license.
new text end

new text begin (b) The commissioner may only issue a gaming facility
license to a tribal entity that, through a valid limited waiver
of sovereign immunity, is subject to the jurisdiction of the
Minnesota state courts and the administrative jurisdiction and
regulation of the state.
new text end

new text begin (c) A license issued under this section may not be
transferred without the written approval of the commissioner.
new text end

new text begin Subd. 6. new text end

new text begin Background investigation. new text end

new text begin Before issuing a
gaming facility license, the commissioner shall conduct a
comprehensive background and financial investigation of the
tribal entity, including its officers, directors, managers,
supervisory personnel, and persons with a direct financial
interest in the tribal entity but does not include the tribal
governments that have formed the tribal entity. The
commissioner may charge the tribal entity an investigation fee
to cover the cost of the investigation. The commissioner may
require that fingerprints be taken from officers, directors,
managers, supervisory personnel, and persons with a direct
financial interest in the tribal entity not including the tribal
governments that have formed the tribal entity. The
commissioner may forward the fingerprints to the Federal Bureau
of Investigation for a national criminal history check.
new text end

new text begin Subd. 7. new text end

new text begin License refusal; suspension and revocation. new text end

new text begin (a)
The commissioner may refuse to issue, or may revoke or suspend,
the gaming facility license if the tribal entity or its
officers, directors, managers, supervisory personnel, and
persons with a direct financial interest in the tribal entity,
not including the tribal governments that have formed the tribal
entity, has:
new text end

new text begin (1) engaged in a material violation of law, order, or rule
relating to gambling within any jurisdiction;
new text end

new text begin (2) operated a gaming facility in violation of approved
game procedures or an approved security plan, which in the
commissioner's opinion adversely and materially affects the
public interest of the state in the effective regulation and
control of gaming;
new text end

new text begin (3) made an intentional false statement in a license
application related to gaming;
new text end

new text begin (4) failed to perform material covenants or representations
made in a license application; or
new text end

new text begin (5) failed to notify the commissioner of a material change
in the information provided in the application.
new text end

new text begin (b) The commissioner may not revoke or suspend a license
under this subdivision unless the commissioner has given the
tribal entity and each participating tribal government express
written notice of the reason for the proposed revocation or
suspension and has granted the tribal entity a reasonable amount
of time to cure the violation giving rise to the proposed
revocation or suspension, and, in the commissioner's reasonable
judgment, the tribal entity has failed to do so. The
commissioner is not required to provide a reasonable time to
cure the violation before a license suspension if, in the
commissioner's reasonable judgment, the violation cannot be
cured by the tribal entity before significant harm will result
to the public health, safety, or welfare. The ability to cure
may include creation of a reorganized or reformed tribal entity,
provided that the reorganized or reformed tribal entity is
approved by the commissioner and the lottery director.
new text end

new text begin (c) A license revocation or suspension under this
subdivision is conducted as a contested case under sections
14.57 to 14.69 of the Administrative Procedure Act, and is in
addition to any other civil, administrative, or criminal
penalties imposed for a violation of law or rule.
new text end

new text begin Subd. 8. new text end

new text begin Other license actions. new text end

new text begin (a) The commissioner may
not issue the gaming facility license under this section or may
by administrative action impose a civil penalty upon the
licensee, issue correction orders, or take other administrative
action if the commissioner determines that the tribal entity, or
officer, director, manager, supervisory personnel, or other
person with a direct financial or management interest in the
licensee:
new text end

new text begin (1) has been convicted of a felony or of a crime in another
jurisdiction, which would be a felony in Minnesota;
new text end

new text begin (2) has been convicted of any crime related to gaming;
new text end

new text begin (3) has been found by a court, the lottery director, the
commissioner, or other state or governmental body to have
engaged in fraud, misrepresentation, or deceit;
new text end

new text begin (4) has provided false or misleading information to the
commissioner;
new text end

new text begin (5) has violated or failed to comply with this section or
any provision of this chapter or chapter 349A;
new text end

new text begin (6) is permanently or temporarily enjoined by any gambling
regulatory agency from engaging in or continuing any conduct or
practice involving any aspect of gambling;
new text end

new text begin (7) has had a gambling-related license revoked or
suspended, or has paid or been required to pay a monetary
penalty of $10,000 or more by a gambling regulator in another
state or jurisdiction;
new text end

new text begin (8) has been the subject of any of the following actions by
the commissioner:
new text end

new text begin (i) has had a license under this chapter denied, suspended,
or revoked;
new text end

new text begin (ii) has been censured or reprimanded, or has paid or been
required to pay a monetary penalty or fine; or
new text end

new text begin (iii) has been the subject of any other discipline by the
commissioner; or
new text end

new text begin (9) based on past activities or criminal record, poses a
threat to the public interest or to the effective regulation and
control of gambling, or creates or enhances the dangers of
unsuitable, unfair, or illegal practices, methods, and
activities in the conduct of gambling or the management of the
business and financial arrangements incidental to the conduct of
gambling.
new text end

new text begin (b) Any conduct in violation of this section, or failure by
the tribal entity to take reasonable action to cure a violation
of this section, may be considered by the commissioner in
determining whether to order revocation or suspension of the
gaming facility license. Any proposed revocation or suspension
is subject to the notice and process requirements of subdivision
7, paragraph (b).
new text end

new text begin (c) Administrative action, including, but not limited to,
imposition of a civil penalty, corrective order, or other
administrative action under this paragraph, is a contested case
under sections 14.57 to 14.69 and is in addition to any other
civil, administrative, or criminal penalties provided for a
violation of law or rule.
new text end

new text begin Subd. 9. new text end

new text begin Required notification. new text end

new text begin (a) The tribal entity
has the obligation to immediately report to the commissioner any
substantial change in its management or ownership. Any
individual who later becomes an officer, director, or other
individual with a direct financial or management interest in the
tribal entity must undergo a comprehensive background and
financial investigation as set forth in subdivision 6. Prior to
assuming any duties or responsibilities for the tribal entity
the individual must file the appropriate license application
information with the commissioner.
new text end

new text begin (b) Following issuance of a gaming facility license, the
licensee must annually certify to the commissioner its
compliance with this section.
new text end

new text begin Subd. 10. new text end

new text begin License review. new text end

new text begin The gaming facility license
must be reviewed by the commissioner every five years. An
application for review must be on a form prescribed by the
commissioner. The commissioner shall review the application and
conduct the comprehensive background investigation pursuant to
subdivision 6.
new text end

new text begin Subd. 11. new text end

new text begin Audit; investigation. new text end

new text begin (a) The tribal entity
shall have an annual certified audit conducted of the tribal
entity's operation of the gaming facility in accordance with
generally accepted accounting principles. The tribal entity
shall file a copy of each audit report with the commissioner.
new text end

new text begin (b) The commissioner has the right to conduct additional
reasonable audits or investigations relating to the operation of
the gaming facility. The commissioner shall have access to all
information, records, and accounts pertaining to the operation
of the gaming facility. The commissioner may recover the
reasonable costs of additional audits and investigations from
the tribal entity.
new text end

new text begin (c) The data created, collected, or retained under this
subdivision is private data as it relates to individuals or
nonpublic data as it relates to entities under chapter 13. At
the commissioner's discretion, the commissioner may share any
data under this subdivision with the director of the lottery or
the tribal entity, as deemed appropriate by the commissioner.
new text end

new text begin Subd. 12. new text end

new text begin Sale of intoxicating liquor. new text end

new text begin Notwithstanding
any other law, local ordinance, or charter provision, the host
community shall issue to the tribal entity an on-sale license
for the sale of intoxicating liquor at the gaming facility
pursuant to chapter 340A. The annual fee for the license issued
pursuant to this subdivision shall be set by the host community
at an amount comparable to the fee charged by municipalities in
the surrounding area for a similar license. Chapter 340A
applies to the sale of intoxicating liquor at the gaming
facility, except that the licensed premises need not be compact
and contiguous if the licensed premises are limited to the
interior and grounds of the facility.
new text end

new text begin Subd. 13. new text end

new text begin Detention of suspects. new text end

new text begin (a) The commissioner
may designate specific employees of the department, the lottery,
or the gaming facility as persons authorized to detain a person
if they have probable cause to believe that the person detained
has violated section 609.651 or 609.76 while at the gaming
facility.
new text end

new text begin (b) A person authorized to detain an individual under
paragraph (a) is not criminally or civilly liable for any
detention authorized by this subdivision if the person has a
good faith belief that probable cause exists for the detention,
and the detention was not conducted with unreasonable force or
in bad faith.
new text end

new text begin (c) A peace officer or person authorized by the
commissioner under paragraph (a) may exclude a person from the
gaming facility or remove that person from the gaming facility
if the person is suspected to have violated section 609.651 or
609.76 or possesses contraband as provided in section 609.762,
subdivision 1.
new text end

new text begin (d) The tribal entity may establish a self-exclusion
program by which persons, at their request, may be excluded from
the gaming facility.
new text end

new text begin Subd. 14. new text end

new text begin Reimbursement of costs. new text end

new text begin The commissioner shall
require that the tribal entity, on a quarterly basis, reimburse
the commissioner for the commissioner's actual costs, including
personnel costs of licensing, regulating, enforcement, and
oversight of the gaming facility under this section and sections
299L.091 to 299L.094. Money received by the commissioner under
this subdivision must be deposited in the state treasury and
credited to the commissioner reimbursement account and is
annually appropriated to the commissioner to pay the costs of
regulating activities at the gaming facility.
new text end

Sec. 2.

new text begin [299L.091] GAMING MANAGEMENT.
new text end

new text begin Subdivision 1. new text end

new text begin License required. new text end

new text begin The tribal entity, or
any entity formed by or engaged by the tribal entity to manage
the operations of the gaming facility under section 349A.17,
must obtain a gaming management license from the commissioner.
new text end

new text begin Subd. 2. new text end

new text begin Application. new text end

new text begin An application for a license under
this section must be on a form prescribed by the commissioner.
The commissioner may issue a gaming management license to the
management entity that will manage or operate the gaming
facility or gaming operations for the tribal entity.
new text end

new text begin Subd. 3. new text end

new text begin License issuance. new text end

new text begin (a) The commissioner shall
issue a license under this section unless information obtained
from the comprehensive background check establishes that
issuance of the license would be adverse to the public interest
or to the effective regulation of gaming.
new text end

new text begin (b) The commissioner may only issue a gaming management
license to an entity that is subject to the jurisdiction of the
Minnesota state courts and the administrative jurisdiction and
regulation of the state.
new text end

new text begin (c) Any license issued under this section is
nontransferable.
new text end

new text begin Subd. 4. new text end

new text begin Background investigation. new text end

new text begin Before issuing a
gaming management license, the commissioner must conduct a
comprehensive background and financial investigation of the
applicant including its officers, directors, managers,
supervisory personnel, and persons with a direct financial
interest in the management entity, not including the tribal
governments that have an interest in the management entity,
provided that if the management entity and the tribal entity are
the same, the commissioner shall utilize the background
investigation conducted as part of the application for a gaming
facility license. The commissioner may require that
fingerprints be taken and the commissioner may forward the
fingerprints to the Federal Bureau of Investigation for a
national criminal history check on the officers, directors,
managers, supervisory personnel, and persons with a direct
financial interest in the management entity, not including the
tribal governments that have an interest in the management
entity. The commissioner may charge an applicant for a gaming
management license a reasonable fee to cover the costs of the
investigation. Money received by the commissioner under this
subdivision must be deposited in the state treasury and credited
to the commissioner reimbursement account and is annually
appropriated to the commissioner to pay for costs incurred under
this subdivision.
new text end

new text begin Subd. 5. new text end

new text begin License actions. new text end

new text begin (a) The commissioner may not
issue a license under this section, or may by administrative
action revoke, suspend, or refuse to renew the gaming management
license, impose a civil penalty upon the licensee, or issue
correction orders, if the commissioner determines that the
management entity, or officer, director, manager, supervisory
personnel, other person with a direct financial interest in the
management entity, not including the tribal government that have
an interest in the management entity financial or management
interest in the licensee:
new text end

new text begin (1) has been convicted of a felony or of a crime in another
jurisdiction, which would be a felony in Minnesota;
new text end

new text begin (2) has been convicted of any crime related to gaming;
new text end

new text begin (3) has been found by a court, the lottery director, the
commissioner, or other state or governmental body to have
engaged in fraud, misrepresentation, or deceit;
new text end

new text begin (4) has provided false or misleading information to the
commissioner;
new text end

new text begin (5) has violated or failed to comply with this chapter or
chapter 349A;
new text end

new text begin (6) is permanently or temporarily enjoined by any gambling
regulatory agency from engaging in or continuing any conduct or
practice involving any aspect of gambling;
new text end

new text begin (7) has had a gambling-related license revoked or
suspended, or has paid or been required to pay a monetary
penalty of $10,000 or more, by a gambling regulator in another
state or jurisdiction; or
new text end

new text begin (8) has been the subject of any of the following actions by
the commissioner:
new text end

new text begin (i) has had a license under chapter 299L denied, suspended,
or revoked;
new text end

new text begin (ii) has been censured or reprimanded or has paid or been
required to pay a monetary penalty or fine; or
new text end

new text begin (iii) has been the subject of any other discipline by the
commissioner;
new text end

new text begin (9) has engaged in conduct that is contrary to the public
health, safety, or welfare, or to the integrity of gambling;
new text end

new text begin (10) based on past activities or criminal record, poses a
threat to the public interest or to the effective regulation and
control of gambling, or creates or enhances the dangers of
unsuitable, unfair, or illegal practices, methods, and
activities in the conduct of gambling or the management of the
business and financial arrangements incidental to the conduct of
gambling;
new text end

new text begin (11) has engaged in a material violation of law, order, or
rule relating to gambling within any jurisdiction;
new text end

new text begin (12) has operated gaming in violation of approved game
procedures or an approved security plan, which in the
commissioner's opinion adversely and materially affects the
public interest of the state in the effective regulation and
control of gaming;
new text end

new text begin (13) has made an intentional false statement in a license
application;
new text end

new text begin (14) has failed to perform material covenants or
representations made in a license application; or
new text end

new text begin (15) has failed to notify the commissioner of a material
change in the information provided in a license application.
new text end

new text begin (b) A license revocation, suspension, or imposition of a
civil penalty under this paragraph is a contested case under
sections 14.57 to 14.69 and is in addition to any criminal
penalties provided for a violation of law or rule.
new text end

new text begin (c) The commissioner shall provide notice of any license
revocation, suspension, or imposition of a civil penalty to the
tribal entity.
new text end

new text begin Subd. 6. new text end

new text begin Required notification. new text end

new text begin (a) The gaming
management licensee has the obligation to immediately report to
the commissioner any change in its management or ownership. Any
individual who later becomes an officer, director, or other
individual with a direct financial or management interest in the
licensee must undergo a comprehensive background and financial
investigation as set forth in subdivision 4. Prior to assuming
any duties or responsibilities for the licensee, the individual
must file the appropriate license application information with
the commissioner.
new text end

new text begin (b) Following issuance of a gaming management license, the
licensee must annually certify to the commissioner its
compliance with this section.
new text end

new text begin Subd. 7. new text end

new text begin License renewal. new text end

new text begin The gaming management license
must be renewed every two years. The commissioner must review
an application for renewal of a gaming management license in the
same manner as set forth in this section for issuance of a
license, including the assessment of costs related to the
background investigation.
new text end

Sec. 3.

new text begin [299L.092] EMPLOYEE LICENSES.
new text end

new text begin Subdivision 1. new text end

new text begin Authority. new text end

new text begin The commissioner may issue
employee licenses for persons employed at the gaming facility.
All persons employed at the gaming facility must have the
appropriate license issued by the commissioner. The tribal
entity must ensure that an employee has a valid employee license
before the employee begins work at the gaming facility.
new text end

new text begin Subd. 2. new text end

new text begin Rulemaking. new text end

new text begin The commissioner may by rule
prescribe the qualifications for employee licenses and standards
required for issuance of employee licenses under this section.
new text end

new text begin Subd. 3. new text end

new text begin Application information. new text end

new text begin An application for an
employee license must be on a form prescribed by the
commissioner and include an affidavit of qualification that the
applicant:
new text end

new text begin (1) does not have a felony conviction of record in a state
or federal court and does not have a state or federal felony
charge pending;
new text end

new text begin (2) is not and never has been connected with or engaged in
an illegal business;
new text end

new text begin (3) has never been found guilty of fraud or
misrepresentation in connection with gambling; and
new text end

new text begin (4) has never been found guilty of a violation of law or
rule relating to gambling within any jurisdiction.
new text end

new text begin Subd. 4. new text end

new text begin Background investigations. new text end

new text begin The commissioner
shall investigate each applicant for an employee license to the
extent the commissioner deems necessary. The commissioner must
require the applicant to be fingerprinted or to furnish the
applicant's fingerprints. The commissioner may require the
tribal entity to pay the costs of processing employee licenses,
renewing employee licenses, and conducting background
investigations on the employee. Money received by the
commissioner under this subdivision must be deposited in the
state treasury and credited to the commissioner reimbursement
account and are annually appropriated to the commissioner to pay
for costs incurred under this subdivision.
new text end

new text begin Subd. 5. new text end

new text begin License issuance and renewal. new text end

new text begin If the
commissioner determines that the applicant is qualified for the
occupation for which licensing is sought and will not adversely
affect the public health, safety, and welfare or the integrity
of gambling in Minnesota, the commissioner may issue an employee
license to the applicant. If the commissioner makes a similar
finding for a renewal of an employee license, the commissioner
may renew the license. Employee licenses are effective for one
year.
new text end

new text begin Subd. 6. new text end

new text begin Revocation and suspension. new text end

new text begin (a) The commissioner
may revoke an employee license for a violation of law or rule
which in the commissioner's opinion adversely affects the
integrity of gambling in Minnesota, or for an intentional false
statement made in a license application. The commissioner may
suspend an employee license for up to one year or refuse to
renew the license or impose a civil penalty for a violation of
law, order, or rule. A license revocation or suspension is a
contested case under sections 14.57 to 14.69 of the
Administrative Procedure Act and is in addition to criminal
penalties imposed for a violation of law or rule.
new text end

new text begin (b) The commissioner may summarily suspend an employee
license prior to a contested case hearing where it is necessary
to ensure the integrity of gambling. A contested case hearing
must be held within 20 days of the summary suspension and the
administrative law judge's report must be issued within 20 days
from the close of the hearing record. In all cases involving
summary suspension, the commissioner must issue its final
decision within 30 days from receipt of the report of the
administrative law judge and subsequent exceptions and argument
under section 14.61.
new text end

Sec. 4.

new text begin [299L.093] VENDOR LICENSES.
new text end

new text begin Subdivision 1. new text end

new text begin Issuance. new text end

new text begin The commissioner may issue a
vendor license for any person or entity that sells or
distributes products or provides services at the gaming
facility. No person may sell or distribute products or provide
a service at the gaming facility unless the person has obtained
a license from the commissioner. All employees of the vendor
whose work requires attendance at the gaming facility must
obtain an employee license under section 299L.092.
new text end

new text begin Subd. 2. new text end

new text begin Rulemaking. new text end

new text begin The commissioner may by rule
prescribe the qualifications for vendor licenses under this
section and standards required for issuance of vendor licenses.
new text end

new text begin Subd. 3. new text end

new text begin Application information. new text end

new text begin An application for a
vendor license must be on a form prescribed by the commissioner
and include an affidavit of qualification that the applicant,
and any officer, director, or person with direct financial
interest in the applicant:
new text end

new text begin (1) does not have a felony conviction of record in a state
or federal court and does not have a state or federal felony
charge pending;
new text end

new text begin (2) is not and never has been connected with or engaged in
an illegal business;
new text end

new text begin (3) has never been found guilty of fraud or
misrepresentation in connection with gambling; and
new text end

new text begin (4) has never been found guilty of a violation of law or
rule relating to gambling within any jurisdiction.
new text end

new text begin Subd. 4. new text end

new text begin Background investigations. new text end

new text begin The commissioner
shall investigate each applicant for a vendor license to the
extent the commissioner deems necessary. The commissioner must
require the applicant be fingerprinted or furnish the
applicant's fingerprints. The commissioner may require the
vendor to pay the costs of processing employee licenses,
renewing vendor licenses, and conducting background
investigations on the vendor. Money received by the
commissioner under this subdivision must be deposited in the
state treasury and credited to the commissioner reimbursement
account, and are annually appropriated to the commissioner to
pay for costs incurred under this subdivision.
new text end

new text begin Subd. 5. new text end

new text begin License issuance and renewal. new text end

new text begin If the
commissioner determines that the applicant is qualified and the
issuance of the license will not adversely affect the public
health, safety, and welfare or the integrity of gambling in
Minnesota, the commissioner may issue a vendor license to the
applicant. If the commissioner makes a similar finding for a
renewal of a vendor license, the commissioner may renew the
license. Vendor licenses are effective for one year.
new text end

new text begin Subd. 6. new text end

new text begin Revocation and suspension. new text end

new text begin (a) The commissioner
may revoke a vendor license for a violation of law or rule that,
in the commissioner's opinion, adversely affects the integrity
of gambling in Minnesota, or for an intentional false statement
made in a license application. The commissioner may suspend a
vendor license for up to one year or refuse to renew the license
or impose a civil penalty for a violation of law, order, or
rule. A license revocation or suspension is a contested case
under sections 14.57 to 14.69 of the Administrative Procedure
Act and is in addition to criminal penalties imposed for a
violation of law or rule.
new text end

new text begin (b) The commissioner may summarily suspend a vendor license
for not more than 90 days prior to a contested case hearing
where it is necessary to ensure the integrity of gambling. A
contested case hearing must be held within 20 days of the
summary suspension and the administrative law judge's report
must be issued within 20 days from the close of the hearing
record. In all cases involving summary suspension, the
commissioner must issue its final decision within 30 days from
receipt of the report of the administrative law judge and
subsequent exceptions and argument under section 14.61.
new text end

Sec. 5.

new text begin [299L.094] NONLOTTERY CASINO GAMES.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this
section, the following terms have the meanings given them.
new text end

new text begin (b) "Nonlottery casino games" means any game authorized by
the commissioner to be conducted by the tribal entity at the
gaming facility that is not a gaming machine or other lottery
game as defined by section 349A.01.
new text end

new text begin (c) "Nonlottery casino games' adjusted gross revenue" means
the sum of all money received from the operation of nonlottery
casino games, less the amounts paid out to players in prizes or
winnings and promotional allowances approved by the lottery
director under section 349A.17 in the nonlottery casino games.
new text end

new text begin Subd. 2. new text end

new text begin Operation. new text end

new text begin Nonlottery casino games may be
operated by the tribal entity in conformance with a plan of
operation approved by the commissioner. The plan of operation
must include, at a minimum:
new text end

new text begin (1) specifying and defining all nonlottery games to be
played, including all governing aspects of each nonlottery
casino game;
new text end

new text begin (2) arrangements to ensure the security of nonlottery
casino gaming;
new text end

new text begin (3) internal control systems for play of nonlottery casino
games; and
new text end

new text begin (4) a plan for the training of nonlottery casino games
personnel in identification of problem gamblers and appropriate
action to prevent or control problem gambling.
new text end

new text begin Subd. 3. new text end

new text begin Plan amendment. new text end

new text begin The plan of operation may be
amended only with the approval of the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Actions. new text end

new text begin The commissioner may revoke, suspend,
refuse to renew, or impose a civil penalty upon the tribal
entity or the gaming management licensee for violation of the
plan of operation. An action under this subdivision shall be
conducted as a contested case under sections 14.57 to 14.69 of
the Administrative Procedures Act and is in addition to criminal
penalties imposed for violation of the plan of operation.
new text end

new text begin Subd. 5. new text end

new text begin Prizes. new text end

new text begin A person who plays a nonlottery casino
game at the gaming facility agrees to be bound by the rules and
game procedures applicable to that particular game. The player
acknowledges that the determination of whether the player has
won a prize is subject to the rules and game procedures adopted
by the plan of operation, claim procedures established by the
plan of operation for that game, and any confidential or public
validation tests established by the plan of operation for that
game. A person under 18 years of age may not claim a prize from
a nonlottery casino game at the gaming facility.
new text end

Sec. 6.

new text begin [299L.095] EMPLOYMENT RESTRICTIONS; CIVIL
PENALTY.
new text end

new text begin (a) The lottery director, the commissioner, or any manager,
director, or supervisor employed by the lottery or the
Department of Public Safety whose job responsibilities include
the oversight, audit, investigation, or regulation of gaming at
a gaming facility licensed by the commissioner must not, while
employed with or within one year after leaving employment,
receive compensation directly or indirectly from, or enter into
a contractual relationship with the tribal entity or any
management entity licensed by the commissioner pursuant to
section 299L.09 or 299L.091.
new text end

new text begin (b) The tribal entity or management entity licensed by the
commissioner must not negotiate with or offer to employ or
compensate the lottery director; commissioner; or any manager,
director, or supervisor employed by the lottery or the
Department of Public Safety whose job responsibilities include
the oversight, audit, investigation, or regulation of gaming at
a gaming facility licensed by the commissioner pursuant to
section 299L.09 or 299L.091 while the person is employed by the
lottery or the Department of Public Safety or within one year
after the person's employment has ended.
new text end

new text begin (c) A state employee who violates this section is subject
to a civil penalty not to exceed $10,000 for each violation.
The attorney general may bring an action in district court to
pursue a violation of this section.
new text end

new text begin (d) The commissioner may take administrative action in
relation to the gaming facility license or management license
for a violation of this section by a tribal entity or management
entity.
new text end

Sec. 7. new text beginEFFECTIVE DATE.
new text end

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

ARTICLE 4

GAMING TRANSACTION FEE

Section 1.

new text begin [297A.651] GAMING FACILITY.
new text end

new text begin (a) The State Lottery must, on or before the 20th day of
each month, transmit to the commissioner an amount equal to the
adjusted gross gaming machine revenue and other lottery games'
adjusted gross revenue, as defined in section 349A.01, for the
previous month multiplied by 26 percent.
new text end

new text begin (b) A gaming transaction fee is imposed on nonlottery
casino games at the gaming facility authorized under section
299L.094 at the rate of 14 percent of nonlottery casino games'
adjusted gross revenue, as defined in section 299L.094. The
tribal entity authorized to conduct nonlottery casino games at
the gaming facility must make the payments due under this
paragraph to the commissioner on or before the 20th day of each
month for the adjusted gross revenue received for the previous
month.
new text end

new text begin (c) The commissioner shall deposit the money transmitted
under this section in the state treasury to be credited as
provided in section 297A.94.
new text end

new text begin (d) The payments imposed by this section are in lieu of the
tax imposed by section 297A.62 relating to wagering at the
gaming facility and any local taxes relating to wagering at the
gaming facility and local license fees relating to wagering at
the gaming facility.
new text end

Sec. 2.

Minnesota Statutes 2004, section 297A.94, is
amended to read:


297A.94 DEPOSIT OF REVENUES.

(a) Except as provided in this section, the commissioner
shall deposit the revenues, including interest and penalties,
derived from the taxes imposed by this chapter in the state
treasury and credit them to the general fund.

(b) The commissioner shall deposit taxes in the Minnesota
agricultural and economic account in the special revenue fund if:

(1) the taxes are derived from sales and use of property
and services purchased for the construction and operation of an
agricultural resource project; and

(2) the purchase was made on or after the date on which a
conditional commitment was made for a loan guaranty for the
project under section 41A.04, subdivision 3.

The commissioner of finance shall certify to the commissioner
the date on which the project received the conditional
commitment. The amount deposited in the loan guaranty account
must be reduced by any refunds and by the costs incurred by the
Department of Revenue to administer and enforce the assessment
and collection of the taxes.

(c) The commissioner shall deposit the revenues, including
interest and penalties, derived from the taxes imposed on sales
and purchases included in section 297A.61, subdivision 3,
paragraph (g), clauses (1) and (4), in the state treasury, and
credit them as follows:

(1) first to the general obligation special tax bond debt
service account in each fiscal year the amount required by
section 16A.661, subdivision 3, paragraph (b); and

(2) after the requirements of clause (1) have been met, the
balance to the general fund.

(d) The commissioner shall deposit the revenues, including
interest and penalties, collected under section 297A.64,
subdivision 5, in the state treasury and credit them to the
general fund. By July 15 of each year the commissioner shall
transfer to the highway user tax distribution fund an amount
equal to the excess fees collected under section 297A.64,
subdivision 5, for the previous calendar year.

(e) For fiscal year 2001, 97 percent; for fiscal years 2002
and 2003, 87 percent; and for fiscal year 2004 and thereafter,
72.43 percent of the revenues, including interest and penalties,
transmitted to the commissioner under section 297A.65, must be
deposited by the commissioner in the state treasury as follows:

(1) 50 percent of the receipts must be deposited in the
heritage enhancement account in the game and fish fund, and may
be spent only on activities that improve, enhance, or protect
fish and wildlife resources, including conservation,
restoration, and enhancement of land, water, and other natural
resources of the state;

(2) 22.5 percent of the receipts must be deposited in the
natural resources fund, and may be spent only for state parks
and trails;

(3) 22.5 percent of the receipts must be deposited in the
natural resources fund, and may be spent only on metropolitan
park and trail grants;

(4) three percent of the receipts must be deposited in the
natural resources fund, and may be spent only on local trail
grants; and

(5) two percent of the receipts must be deposited in the
natural resources fund, and may be spent only for the Minnesota
Zoological Garden, the Como Park Zoo and Conservatory, and the
Duluth Zoo.

(f) The revenue dedicated under paragraph (e) may not be
used as a substitute for traditional sources of funding for the
purposes specified, but the dedicated revenue shall supplement
traditional sources of funding for those purposes. Land
acquired with money deposited in the game and fish fund under
paragraph (e) must be open to public hunting and fishing during
the open season, except that in aquatic management areas or on
lands where angling easements have been acquired, fishing may be
prohibited during certain times of the year and hunting may be
prohibited. At least 87 percent of the money deposited in the
game and fish fund for improvement, enhancement, or protection
of fish and wildlife resources under paragraph (e) must be
allocated for field operations.

new text begin (g) The commissioner must deposit revenues, including
interest and penalties, transmitted to the commissioner under
section 297A.651 into the gaming facility proceeds fund
established in section 297A.941.
new text end

Sec. 3.

new text begin [297A.941] GAMING FACILITY PROCEEDS FUND.
new text end

new text begin A gaming facility proceeds fund is established in the state
treasury, consisting of money deposited in the fund under
section 297A.94, paragraph (g), and any other money credited to
the fund by law. Money in the fund is appropriated as follows:
new text end

new text begin (1) ten percent of the receipts is annually appropriated to
the community assets account; and
new text end

new text begin (2) the remaining 90 percent of the receipts shall be
transferred to the general fund.
new text end

Sec. 4. new text beginEFFECTIVE DATE.
new text end

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

ARTICLE 5

MISCELLANEOUS PROVISIONS

Section 1.

Minnesota Statutes 2004, section 299L.07,
subdivision 2, is amended to read:


Subd. 2.

Exclusions.

Notwithstanding subdivision 1, a
gambling device:

(1) may be sold by a person who is not licensed under this
section, if the person (i) is not engaged in the trade or
business of selling gambling devices, and (ii) does not sell
more than one gambling device in any calendar year;

(2) may be sold by the governing body of a federally
recognized Indian tribe described in subdivision 2a, paragraph
(b), clause (1), which is not licensed under this section, if
(i) the gambling device was operated by the Indian tribe, (ii)
the sale is to a distributor licensed under this section, and
(iii) the licensed distributor notifies the commissioner of the
purchase, in the same manner as is required when the licensed
distributor ships a gambling device into Minnesota;

(3) may be possessed by a person not licensed under this
section if the person holds a permit issued under section
299L.08; deleted text beginand
deleted text end

(4) may be possessed by a state agency, with the written
authorization of the director, for display or evaluation
purposes only and not for the conduct of gamblingnew text begin; and
new text end

new text begin (5) may be possessed by the State Lottery as authorized
under chapter 349A
new text end.

Sec. 2.

Minnesota Statutes 2004, section 299L.07,
subdivision 2a, is amended to read:


Subd. 2a.

Restrictions.

(a) A manufacturer licensed
under this section may sell, offer to sell, lease, or rent, in
whole or in part, a gambling device only to a distributor
licensed under this section new text beginor to the State Lottery as
authorized under chapter 349A
new text end.

(b) A distributor licensed under this section may sell,
offer to sell, market, rent, lease, or otherwise provide, in
whole or in part, a gambling device only to:

(1) the governing body of a federally recognized Indian
tribe that is authorized to operate the gambling device under a
tribal state compact under the Indian Gaming Regulatory Act,
Public Law 100-497, and future amendments to it;

(2) a person for use in the person's dwelling for display
or amusement purposes in a manner that does not afford players
an opportunity to obtain anything of value;

(3) another distributor licensed under this section; deleted text beginor
deleted text end

(4) a person in another state who is authorized under the
laws of that state to possess the gambling devicenew text begin; or
new text end

new text begin (5) the State Lottery as authorized under chapter 349Anew text end.

Sec. 3.

Minnesota Statutes 2004, section 340A.410,
subdivision 5, is amended to read:


Subd. 5.

Gambling prohibited.

(a) Except as otherwise
provided in this subdivision, no retail establishment licensed
to sell alcoholic beverages may keep, possess, or operate, or
permit the keeping, possession, or operation on the licensed
premises of dice or any gambling device as defined in section
349.30, or permit gambling therein.

(b) Gambling equipment may be kept or operated and raffles
conducted on licensed premises and adjoining rooms when the use
of the gambling equipment is authorized by (1) chapter 349, (2)
a tribal ordinance in conformity with the Indian Gaming
Regulatory Act, Public Law 100-497, or (3) a tribal-state
compact authorized under section 3.9221.

(c) Lottery tickets may be purchased and sold within the
licensed premises as authorized by the director of the lottery
under chapter 349A.

(d) Dice may be kept and used on licensed premises and
adjoining rooms as authorized by section 609.761, subdivision 4.

new text begin (e) Gambling devices may be operated and gambling permitted
at a gaming facility as authorized by chapter 299L and 349A.
new text end

Sec. 4.

Minnesota Statutes 2004, section 541.20, is
amended to read:


541.20 RECOVERY OF MONEY LOST.

Every person who, by playing at cards, dice, or other game,
or by betting on the hands or sides of such as are gambling,
shall lose to any person so playing or betting any sum of money
or any goods, and pays or delivers the same, or any part
thereof, to the winner, may sue for and recover such money by a
civil action, before any court of competent jurisdiction. For
purposes of this section, gambling shall not include pari-mutuel
wagering conducted under a license issued pursuant to chapter
240, purchase or sale of tickets in the state lottery, new text beginpurchase
of gaming machine plays as authorized under chapter 349A,
conduct of any lottery or nonlottery casino games at a gaming
facility as authorized under chapters 299L and 349A,
new text endor gambling
authorized under chapters 349 and 349A.

Sec. 5.

Minnesota Statutes 2004, section 541.21, is
amended to read:


541.21 COMMITMENTS FOR GAMBLING DEBT VOID.

Every note, bill, bond, mortgage, or other security or
conveyance in which the whole or any part of the consideration
shall be for any money or goods won by gambling or playing at
cards, dice, or any other game whatever, or by betting on the
sides or hands of any person gambling, or for reimbursing or
repaying any money knowingly lent or advanced at the time and
place of such gambling or betting, or lent and advanced for any
gambling or betting to any persons so gambling or betting, shall
be void and of no effect as between the parties to the same, and
as to all persons except such as hold or claim under them in
good faith, without notice of the illegality of the
consideration of such contract or conveyance. The provisions of
this section shall not apply to: (1) pari-mutuel wagering
conducted under a license issued pursuant to chapter 240; (2)
purchase of tickets in the state lottery new text beginor other wagering
authorized
new text endunder chapter new text begin299L or new text end349A; (3) gaming activities
conducted pursuant to the Indian Gaming Regulatory Act, 25
U.S.C. 2701 et seq.; or (4) lawful gambling activities permitted
under chapter 349.

Sec. 6.

Minnesota Statutes 2004, section 609.75,
subdivision 3, is amended to read:


Subd. 3.

What are not bets.

The following are not bets:

(1) A contract to insure, indemnify, guarantee or otherwise
compensate another for a harm or loss sustained, even though the
loss depends upon chance.

(2) A contract for the purchase or sale at a future date of
securities or other commodities.

(3) Offers of purses, prizes or premiums to the actual
contestants in any bona fide contest for the determination of
skill, speed, strength, endurance, or quality or to the bona
fide owners of animals or other property entered in such a
contest.

(4) The game of bingo when conducted in compliance with
sections 349.11 to 349.23.

(5) A private social bet not part of or incidental to
organized, commercialized, or systematic gambling.

(6) The operation of equipment or the conduct of a raffle
under sections 349.11 to 349.22, by an organization licensed by
the Gambling Control Board or an organization exempt from
licensing under section 349.166.

(7) Pari-mutuel betting on horse racing when the betting is
conducted under chapter 240.

(8) The purchase and sale of state lottery tickets under
chapter 349A.

new text begin (9) Plays on a gaming machine, or purchase or participating
in any lottery or nonlottery casino game at a gaming facility
authorized under chapter 299L or 349A.
new text end

Sec. 7.

Minnesota Statutes 2004, section 609.761, is
amended by adding a subdivision to read:


new text begin Subd. 6. new text end

new text begin Gaming facility. new text end

new text beginSections 609.755 and 609.76 do
not prohibit the manufacture, possession, sale, or operation of
a gaming machine at a gaming facility under chapter 349A, or the
conduct of any other lottery or nonlottery casino game at a
gaming facility under chapters 299L and 349A
new text end.

Sec. 8. new text beginSEVERABILITY; SAVINGS.
new text end

new text begin If any part of this act is found to be invalid because it
is in conflict with a provision of the Constitution of the State
of Minnesota or the Constitution of the United States, or for
any other reason, all other provisions of this act shall remain
valid and any rights, remedies, and privileges that have been
otherwise accrued by this act, shall remain in effect and may be
proceeded with and concluded under the provisions of this act.
new text end

Sec. 9. new text beginEFFECTIVE DATE.
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new text begin This article is effective the day following final enactment.
new text end