as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am
1.1 A bill for an act 1.2 relating to economic development; authorizing 1.3 excursion boat gambling; establishing an excursion 1.4 boat gambling board; appropriating money; amending 1.5 Minnesota Statutes 2000, section 299L.02, by adding a 1.6 subdivision; proposing coding for new law as Minnesota 1.7 Statutes, chapter 349C. 1.8 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.9 ARTICLE 1 1.10 EXCURSION BOAT GAMBLING 1.11 Section 1. [349C.01] [DEFINITIONS.] 1.12 Subdivision 1. [APPLICATION.] The definitions in this 1.13 section apply to sections 1 to 18. 1.14 Subd. 2. [ADJUSTED GROSS RECEIPTS.] "Adjusted gross 1.15 receipts" means the gross receipts less winnings paid to 1.16 wagerers. 1.17 Subd. 3. [APPLICANT.] "Applicant" means a person applying 1.18 for an occupational license or applying for a license to operate 1.19 an excursion gambling boat, or the officers and members of the 1.20 board of directors of a qualified sponsoring organization 1.21 located in Minnesota applying for a license to conduct gambling 1.22 games on an excursion gambling boat. 1.23 Subd. 4. [BOARD.] "Board" means the excursion boat 1.24 gambling board. 1.25 Subd. 5. [CHEAT.] "Cheat" means to alter the selection of 1.26 criteria which determine the result of a gambling game or the 2.1 amount or frequency of payment in a gambling game. 2.2 Subd. 6. [CITY.] "City" means a home rule charter or 2.3 statutory city. 2.4 Subd. 7. [DISTRIBUTOR.] "Distributor" means a person who 2.5 sells, markets, or otherwise distributes gambling games or 2.6 implements of gambling which are usable in the lawful conduct of 2.7 gambling games under this chapter, to a licensee authorized to 2.8 conduct gambling games under this chapter. 2.9 Subd. 8. [DOCK.] "Dock" means the location where an 2.10 excursion gambling boat moors for the purpose of embarking 2.11 passengers for and disembarking passengers from a gambling 2.12 excursion. 2.13 Subd. 9. [EXCURSION GAMBLING BOAT.] "Excursion gambling 2.14 boat" means a self-propelled excursion boat on which lawful 2.15 gambling is authorized and licensed as provided in this chapter. 2.16 Subd. 10. [EXCURSION SEASON.] "Excursion season" includes 2.17 the months of April through October. 2.18 Subd. 11. [GAMBLING EXCURSION.] "Gambling excursion" means 2.19 the time during which gambling games may be operated on an 2.20 excursion gambling boat whether docked or during a cruise. 2.21 Subd. 12. [GAMBLING GAME.] "Gambling game" means 2.22 twenty-one, dice, slot machine, video game of chance, or 2.23 roulette wheel. 2.24 Subd. 13. [GROSS RECEIPTS.] "Gross receipts" means the 2.25 total sums wagered under this chapter. 2.26 Subd. 14. [HOLDER OF OCCUPATIONAL LICENSE.] "Holder of 2.27 occupational license" means a person licensed by the board to 2.28 perform an occupation which the board has identified as 2.29 requiring a license to engage in excursion boat gambling in 2.30 Minnesota. 2.31 Subd. 15. [LICENSEE.] "Licensee" means any person licensed 2.32 under section 7. 2.33 Subd. 16. [MANUFACTURER.] "Manufacturer" means a person 2.34 who designs, assembles, fabricates, produces, constructs, or who 2.35 otherwise prepares a product or a component part of a product of 2.36 any implement of gambling usable in the lawful conduct of 3.1 gambling games under this chapter. 3.2 Subd. 17. [OFF SEASON.] "Off season" includes the months 3.3 of November through March. 3.4 Subd. 18. [QUALIFIED SPONSORING ORGANIZATION.] "Qualified 3.5 sponsoring organization" means a person or association that can 3.6 show to the satisfaction of the board that the person or 3.7 association is eligible for exemption from federal income 3.8 taxation under section 501(c)(3), 501(c)(4), 501(c)(5), 3.9 501(c)(6), 501(c)(7), 501(c)(8), 501(c)(10), or 501(c)(19) of 3.10 the Internal Revenue Code of 1986, as amended. 3.11 Sec. 2. [349C.02] [EXEMPTION.] 3.12 This chapter does not apply to the pari-mutuel system of 3.13 wagering used or intended to be used in connection with the 3.14 horse-racing meetings as authorized under chapter 240, lottery 3.15 authorized under chapter 349A, or bingo or games of skill or 3.16 chance authorized under chapter 349. 3.17 Sec. 3. [349C.03] [EXCURSION BOAT GAMBLING AUTHORIZED.] 3.18 The system of wagering on a gambling game as provided by 3.19 this chapter is legal when conducted on an excursion gambling 3.20 boat at authorized locations by a licensee as provided in this 3.21 chapter. 3.22 Sec. 4. [349C.04] [DIRECTOR.] 3.23 Subdivision 1. [APPOINTED.] The governor shall appoint, 3.24 with the advice and consent of the senate, a director from a 3.25 list of one or more persons submitted by the board. The 3.26 director serves in the unclassified service at the pleasure of 3.27 the governor. 3.28 Subd. 2. [DUTIES OF DIRECTOR.] The director has the 3.29 following duties: 3.30 (1) to carry out excursion boat gambling policy established 3.31 by the board; 3.32 (2) to employ and supervise personnel of the board; 3.33 (3) to advise and make recommendations to the board on 3.34 rules; 3.35 (4) to issue licenses as authorized by the board; 3.36 (5) to issue cease and desist orders; 4.1 (6) to make recommendations to the board on license 4.2 issuance, denial, suspension and revocation, and penalties the 4.3 board imposes; and 4.4 (7) to ensure that board rules, policy, and decisions are 4.5 adequately and accurately conveyed to the board's licensees. 4.6 Subd. 3. [CEASE AND DESIST ORDERS.] Whenever it appears to 4.7 the director that any person has engaged or is about to engage 4.8 in any act or practice constituting a violation of this chapter 4.9 or any rule, paragraphs (a) and (b) apply. 4.10 (a) The director has the power to issue and cause to be 4.11 served upon the person an order requiring the person to cease 4.12 and desist from violations of this chapter. The order must give 4.13 reasonable notice of the rights of the person to request a 4.14 hearing and must state the reason for the entry of the order. A 4.15 hearing shall be held not later than seven days after the 4.16 request for the hearing is received by the board after which and 4.17 within 20 days of the date of the hearing the board shall issue 4.18 an order vacating the cease and desist order or making it 4.19 permanent as the facts require. All hearings shall be conducted 4.20 according to chapter 14. If the person to whom a cease and 4.21 desist order is issued fails to appear at the hearing after 4.22 being duly notified, the person shall be deemed in default, and 4.23 the proceeding may be determined against the person upon 4.24 consideration of the cease and desist order, the allegation of 4.25 which may be deemed to be true. 4.26 (b) The board may bring an action in the district court in 4.27 the appropriate county to enjoin the acts or practices and to 4.28 enforce compliance with this chapter or any rule and may refer 4.29 the matter to the attorney general. Upon a proper showing, a 4.30 permanent or temporary injunction, restraining order, or writ of 4.31 mandamus must be granted. The court may not require the board 4.32 to post a bond. 4.33 Subd. 4. [EXECUTIVE ASSISTANT.] The director may appoint 4.34 an executive assistant to the director, who is in the 4.35 unclassified service. 4.36 Sec. 5. [349C.05] [EXCURSION BOAT GAMBLING BOARD.] 5.1 Subdivision 1. [BOARD.] The excursion boat gambling board 5.2 consists of seven members with three members appointed by the 5.3 governor, two members appointed by the subcommittee on 5.4 committees of the senate committee on rules and administration, 5.5 and two members appointed by the speaker of the house of 5.6 representatives. The membership terms, compensation, removal, 5.7 and filling of vacancies of the board are as provided in section 5.8 15.0575. The board shall select one of its members to serve as 5.9 chair. 5.10 Subd. 2. [POWERS.] The board shall have full jurisdiction 5.11 over and shall supervise all gambling operations governed by 5.12 this chapter. The board shall have the following powers and may 5.13 adopt rules to implement this chapter: 5.14 (1) to investigate applicants and determine the eligibility 5.15 of applicants for a license; 5.16 (2) to license qualified sponsoring organizations, to 5.17 license the operators of excursion gambling boats, to identify 5.18 occupations within the excursion gambling boat operations which 5.19 require licensing, and to adopt standards for licensing the 5.20 occupations including establishing fees for the occupational 5.21 licenses and licenses for qualified sponsoring organizations. 5.22 Fees paid to the board must be deposited in a special account of 5.23 the general fund of the state. All revenue received by the 5.24 board from license fees and admission fees must be deposited in 5.25 the special account in the general fund; 5.26 (3) to adopt standards for all excursion gambling boat 5.27 operations and standards for the facilities within which the 5.28 gambling operations are to be held. The board may authorize the 5.29 operation of gambling games on an excursion gambling boat which 5.30 is also licensed to sell or serve alcoholic beverages, wine, or 5.31 beer; 5.32 (4) to regulate the wagering structure for gambling 5.33 excursions including providing a maximum wager of $5 per hand or 5.34 play and a maximum loss of $200 per individual player per 5.35 gambling excursion; 5.36 (5) to enter the office, excursion gambling boat, 6.1 facilities, or other places of business of a licensee to 6.2 determine compliance with this chapter; 6.3 (6) to investigate alleged violations of this chapter or 6.4 the board rules, orders, or final decisions and to take 6.5 appropriate disciplinary action against a licensee or a holder 6.6 of an occupational license for a violation, or institute 6.7 appropriate legal action for enforcement, or both; 6.8 (7) to require a licensee, an employee of a licensee, or a 6.9 holder of an occupational license to remove a person violating 6.10 this chapter or the board rules, orders, or final orders, or a 6.11 person considered to be undesirable from the excursion gambling 6.12 boat facilities; 6.13 (8) to require the removal of a licensee, an employee of a 6.14 licensee, or a holder of an occupational license for a violation 6.15 of this chapter or a board rule, or engaging in a fraudulent 6.16 practice; 6.17 (9) to require a licensee to file an annual balance sheet 6.18 and profit and loss statement pertaining to the licensee's 6.19 gambling activities in this state, together with a list of the 6.20 stockholders or other persons having any beneficial interest in 6.21 the gambling activities of each licensee; 6.22 (10) to issue subpoenas for the attendance of witnesses and 6.23 subpoenas duces tecum for the production of books, records, and 6.24 other pertinent documents and to administer oaths and 6.25 affirmations to the witnesses when, in the judgment of the 6.26 board, it is necessary to enforce this chapter or the board 6.27 rules; 6.28 (11) to keep accurate and complete records of its 6.29 proceedings and to certify the records as may be appropriate; 6.30 (12) to assess a fine and revoke or suspend licenses; 6.31 (13) to take any other action as may be reasonable or 6.32 appropriate to enforce this chapter and the board rules; 6.33 (14) to require all licensees of gambling game operations 6.34 to use a cashless wagering system where all players' money is 6.35 converted to tokens, electronic cards, or chips that can only be 6.36 used for wagering on the excursion gambling boat; 7.1 (15) to determine the payouts from the gambling games 7.2 authorized under this chapter. In making the determination of 7.3 payouts, the board shall consider factors that provide gambling 7.4 and entertainment opportunities that are beneficial to the 7.5 gambling licensees and the general public; 7.6 (16) to set the payout rate for all slot machines; 7.7 (17) to define the duration of an excursion which must be 7.8 at least three hours during the excursion season. For the off 7.9 season, the board shall adopt rules limiting times of admission 7.10 to excursion gambling boats consistent with the maximum loss per 7.11 player per gambling excursion specified in clause (4); 7.12 (18) to provide for the continuous videotaping of all 7.13 gambling activities on an excursion boat; 7.14 (19) to provide for adequate security aboard each excursion 7.15 gambling boat; 7.16 (20) to provide that gambling games shall be conducted only 7.17 during the same hours when alcoholic beverages are lawfully sold 7.18 or dispensed; 7.19 (21) to establish minimum charges for admission to 7.20 excursion gambling boats and regulate the number of free 7.21 admissions; and 7.22 (22) to provide for periodic, mandatory drug testing, of 7.23 not less than every 60 days, of persons employed as captains, 7.24 pilots, or physical operators of excursion gambling boats under 7.25 this chapter. 7.26 Sec. 6. [349C.06] [LICENSES FOR CONDUCTING GAMBLING GAMES 7.27 ON EXCURSION BOAT AND FOR BOAT OPERATORS; APPLICATIONS; FEE.] 7.28 Subdivision 1. [APPLICATION.] A qualified sponsoring 7.29 organization may apply to the board for a license to conduct 7.30 gambling games on an excursion gambling boat as provided in this 7.31 chapter. A person may apply to the board for a license to 7.32 operate an excursion gambling boat. The application must be 7.33 filed with the director of the board at least 90 days before the 7.34 first day of the next excursion season as determined by the 7.35 board, must identify the excursion gambling boat upon which 7.36 gambling games will be authorized, must specify the exact 8.1 location where the excursion gambling boat will be docked, and 8.2 must be in a form and contain information as the board requires. 8.3 Subd. 2. [FEE.] The annual license fee to operate an 8.4 excursion gambling boat must be based on the passenger-carrying 8.5 capacity, including crew, for which the excursion gambling boat 8.6 is registered. The annual fee is $5 per person capacity. 8.7 Sec. 7. [349C.07] [REQUIREMENTS OF APPLICANT; FEE; 8.8 PENALTY.] 8.9 Subdivision 1. [FORM.] A person shall not be issued a 8.10 license to conduct gambling games on an excursion gambling boat 8.11 or a license to operate an excursion gambling boat under this 8.12 chapter, an occupational license, a distributor license, or a 8.13 manufacturer license unless the person has completed and signed 8.14 an application on the required form. The application must 8.15 include the full name, residence, date of birth, and other 8.16 personal identifying information of the applicant that the board 8.17 considers necessary. The application must also indicate whether 8.18 the applicant has any of the following; 8.19 (1) a record of conviction of a felony; 8.20 (2) an addiction to alcohol or a controlled substance; or 8.21 (3) a history of mental illness. 8.22 Subd. 2. [APPLICANT DESCRIPTION.] An applicant shall 8.23 submit pictures, fingerprints, and descriptions of physical 8.24 characteristics to the board in the manner required on the 8.25 application form. 8.26 Subd. 3. [INVESTIGATION FEES.] The board shall charge the 8.27 applicant a fee set by the department of public safety, division 8.28 of gambling enforcement, to defray the costs associated with the 8.29 search and classification of fingerprints and background 8.30 investigations conducted by agents of the division of gambling 8.31 enforcement. This fee is in addition to any other license fee 8.32 charged by the board. 8.33 Subd. 4. [BACKGROUND INVESTIGATION.] Before a license is 8.34 granted, the division of gambling enforcement shall conduct a 8.35 thorough background investigation of the applicant for a license 8.36 to operate a gambling game operation on an excursion gambling 9.1 boat. The applicant shall provide information on a form as 9.2 required by the division. 9.3 Subd. 5. [DISTRIBUTION OF RECEIPTS.] Before a qualified 9.4 sponsoring organization is licensed to operate gambling games 9.5 under this chapter, the qualified sponsoring organization shall 9.6 certify that the receipts of all gambling games, less reasonable 9.7 expenses, charges, taxes, fees, and deductions allowed under 9.8 this chapter, will be distributed as winnings to players or 9.9 participants. A qualified sponsoring organization shall not 9.10 make a contribution to a candidate, political committee, 9.11 candidate's committee, state statutory political committee, 9.12 county statutory political committee, national political party, 9.13 or fundraising event. The membership of the board of directors 9.14 of the qualified sponsoring organization shall represent a broad 9.15 interest of the communities. 9.16 Subd. 6. [OFFICE OF TOURISM.] Before a license is granted, 9.17 an operator of an excursion gambling boat shall work with the 9.18 office of tourism to promote tourism throughout Minnesota. 9.19 Tourism information from local civic and private persons may be 9.20 submitted for dissemination. 9.21 Subd. 7. [PENALTY.] A person who knowingly makes a false 9.22 statement on the application is guilty of a misdemeanor. 9.23 Subd. 8. [APPLICANT DEFINED.] For the purposes of this 9.24 section, "applicant" includes each member of the board of 9.25 directors of a qualified sponsoring organization. 9.26 Subd. 9. [SEARCHES.] (a) The licensee or a holder of an 9.27 occupational license shall consent to the search, without a 9.28 warrant, by agents of the division of gambling enforcement or 9.29 employees of the board, of the licensee's or holder's person, 9.30 personal property, and effects, and premises that are located on 9.31 the excursion gambling boat or adjacent facilities under control 9.32 of the licensee, in order to inspect or investigate for 9.33 violations of this chapter or rules adopted by the board. 9.34 (b) This subdivision does not permit a warrantless 9.35 inspection of living quarters or sleeping rooms on the riverboat 9.36 provided that: 10.1 (1) the licensee has specifically identified those areas 10.2 which are to be used as living quarters or sleeping rooms in 10.3 writing to the board; 10.4 (2) gaming is not permitted in the living quarters or 10.5 sleeping rooms, and devices, records, or other items relating to 10.6 the licensee's gaming operations are not stored, kept, or 10.7 maintained in the living quarters or sleeping rooms; and 10.8 (3) alcoholic beverages are not stored, kept, or maintained 10.9 in the living quarters or sleeping rooms except those legally 10.10 possessed by the individual occupying the quarters or room. 10.11 Sec. 8. [349C.08] [LICENSES; TERMS AND CONDITIONS; 10.12 REVOCATION.] 10.13 Subdivision 1. [ISSUANCE.] If the board is satisfied that 10.14 this chapter and rules adopted under this chapter applicable to 10.15 licensees have been or will be complied with, the board shall 10.16 issue a license for a period of not more than three years to an 10.17 applicant to own a gambling game operation and to an applicant 10.18 to operate an excursion gambling boat. The board shall decide 10.19 which of the gambling games authorized under this chapter it 10.20 will permit. The board shall decide the type of excursion 10.21 gambling boats licensed under this chapter for operation on the 10.22 rivers and lakes of this state. The license shall specify the 10.23 name of the licensee, the type of license granted, the place 10.24 where the excursion gambling boats will operate and dock, and 10.25 the time and number of days during the excursion season and the 10.26 off season when gambling may be conducted by the licensee. The 10.27 board shall not allow a licensee to conduct gambling games on an 10.28 excursion gambling boat while docked during the off season if 10.29 the licensee does not operate gambling excursions for a minimum 10.30 number of days during the excursion season. 10.31 Subd. 2. [LOCATION AND NUMBER.] The board may issue up to 10.32 five licenses for the operation of excursion gambling boats, 10.33 with one license to be issued for operation of an excursion 10.34 gambling boat to be docked in each of the following cities: 10.35 Duluth, Minneapolis, Saint Paul, South Saint Paul, and Winona. 10.36 Subd. 3. [CONDITIONS.] A license shall only be granted to 11.1 an applicant upon the express conditions that: 11.2 (1) the applicant shall not, by a lease, contract, 11.3 understanding, or arrangement of any kind, grant, assign, or 11.4 turn over to a person the operation of an excursion gambling 11.5 boat licensed under this section or of the system of wagering 11.6 described in section 10; and 11.7 (2) the applicant shall not in any manner permit a person 11.8 other than the licensee to have a share, percentage, or 11.9 proportion of the money received for admissions to the excursion 11.10 gambling boat. This subdivision does not prohibit a management 11.11 contract approved by the board. 11.12 Subd. 4. [RIVERBOAT HISTORY.] The board shall require, as 11.13 a condition of granting a license, that an applicant to operate 11.14 an excursion gambling boat, develop, and, as nearly as 11.15 practicable, recreate boats that resemble Minnesota's riverboat 11.16 history. 11.17 Subd. 5. [MINNESOTA RESOURCES.] The board shall require 11.18 that an applicant use Minnesota resources, goods, and services 11.19 in the operation of an excursion gambling boat. The board shall 11.20 develop standards to assure that a substantial amount of all 11.21 resources and goods used in the operation of an excursion 11.22 gambling boat come from Minnesota and that a substantial amount 11.23 of services and entertainment be provided by Minnesotans. 11.24 Subd. 6. [DOCUMENTATION.] The board shall, as a condition 11.25 of granting a license, require an applicant to provide written 11.26 documentation that, on each excursion gambling boat: 11.27 (1) no more than 30 percent of the square footage is used 11.28 for gambling activity; 11.29 (2) every effort is made to ensure that a substantial 11.30 number of the staff and entertainers employed are residents of 11.31 Minnesota; 11.32 (3) a section is reserved solely for activities and 11.33 interests of persons under the age of 21 and is staffed to 11.34 provide adequate supervision; and 11.35 (4) a section is reserved for promotion and sale of arts, 11.36 crafts, and gifts native to and made in Minnesota. 12.1 Subd. 7. [LEGISLATIVE INTENT.] It is the intent of the 12.2 legislature that employees of the applicant be paid at least 25 12.3 percent above the federal minimum wage. 12.4 Subd. 8. [DENIAL OF LICENSE.] A license shall not be 12.5 granted if there is substantial evidence that any of the 12.6 following apply: 12.7 (1) the applicant has been suspended from operating a game 12.8 of chance or gambling operation in another jurisdiction by a 12.9 board or commission of that jurisdiction; 12.10 (2) the applicant has not demonstrated financial 12.11 responsibility sufficient to adequately meet the requirements of 12.12 the enterprise proposed; 12.13 (3) the applicant is not the true owner of the enterprise 12.14 proposed; 12.15 (4) the applicant is not the sole owner, and the fact that 12.16 other persons having ownership in the enterprise has not been 12.17 disclosed; 12.18 (5) the applicant is a corporation and ten percent of the 12.19 stock of the corporation is subject to a contract or option to 12.20 purchase at any time during the period for which the license is 12.21 to be issued unless the contract or option was disclosed to the 12.22 board and the board approved the sale or transfer during the 12.23 period of the license; 12.24 (6) the applicant has knowingly made a false statement of a 12.25 material fact to the board; 12.26 (7) the applicant has failed to meet a monetary obligation 12.27 in connection with an excursion gambling boat; 12.28 (8) there is substantial evidence that the applicant is not 12.29 of good repute and moral character; or 12.30 (9) the applicant has pled guilty to, or has been convicted 12.31 of, a felony. 12.32 Subd. 9. [PROHIBITED LOANS.] A licensee shall not loan to 12.33 any person money or any other thing of value for the purpose of 12.34 permitting that person to wager on any game of chance. 12.35 Subd. 10. [DOCKING FEE.] If a docking fee is charged by a 12.36 city, a licensee operating an excursion gambling boat shall pay 13.1 the docking fee one year in advance. 13.2 Subd. 11. [PAYMENT OF TAXES OR FEES.] A licensee shall not 13.3 be delinquent in the payment of property taxes or other taxes or 13.4 fees or in the payment of any other contractual obligation or 13.5 debt due or owed to a city or county. 13.6 Subd. 12. [WATERCRAFT LICENSE.] An excursion gambling boat 13.7 operated on inland waters of this state shall meet all of the 13.8 requirements of section 86B.401 and is subject to an inspection 13.9 of its sanitary facilities to protect the environment and water 13.10 quality before a watercraft license is issued or a license is 13.11 issued under this chapter. 13.12 Subd. 13. [PORTS OF CALL.] If a licensed excursion boat 13.13 stops at more than one harbor, the board shall require the 13.14 excursion boat operator to develop a schedule for ports of call, 13.15 and that the port of call has the necessary facilities to handle 13.16 the boat. The board may limit the schedule to only one port of 13.17 call per county. 13.18 Subd. 14. [IMMEDIATE REVOCATION.] Upon a violation of any 13.19 of the conditions listed in this section, the board shall 13.20 immediately revoke the license. 13.21 Sec. 9. [349C.09] [BOND OF LICENSEE.] 13.22 A licensee shall post a bond to the state before the 13.23 license is issued in a sum as the board shall fix, with sureties 13.24 to be approved by the board. The bond shall be used to 13.25 guarantee that the licensee faithfully makes the payments, keeps 13.26 its books and records and makes reports, and conducts its 13.27 gambling games in conformity with this chapter and the rules 13.28 adopted by the board. The bond shall not be canceled by a 13.29 surety on less than 30 days' notice in writing to the board. If 13.30 a bond is canceled and the licensee fails to file a new bond 13.31 with the board in the required amount on or before the effective 13.32 date of cancellation, the licensee's license must be revoked. 13.33 The total and aggregate liability of the surety on the bond is 13.34 limited to the amount specified in the bond. 13.35 Sec. 10. [349C.10] [WAGERING; MINORS PROHIBITED.] 13.36 The following forms of wagering on gambling games are the 14.1 only permitted forms of wagering on an excursion boat. 14.2 (a) Licensees shall only allow a maximum wage of $5 per 14.3 hand or play and a maximum loss of $200 per person during each 14.4 gambling excursion. However, the board may adopt rules allowing 14.5 additional wagers consistent with generally accepted wagering 14.6 options in the games of twenty-one and dice. 14.7 (b) The licensee may receive wagers only from a person 14.8 present on a licensed excursion gambling boat. 14.9 (c) The licensee shall exchange the money of each wagerer 14.10 for tokens, chips, or other forms of credit to be wagered on the 14.11 gambling games. The licensee shall exchange the gambling 14.12 tokens, chips, or other forms of wagering credit for money at 14.13 the request of the wagerer. 14.14 (d) Wagering shall not be conducted with money or other 14.15 negotiable currency. 14.16 (e) A person under the age of 21 years shall not make a 14.17 wager on an excursion gambling boat and shall not be allowed in 14.18 the area of the excursion boat where gambling is being conducted. 14.19 (f) A licensee shall not conduct gambling games while the 14.20 excursion gambling boat is docked unless it is temporarily 14.21 docked for embarking or disembarking passengers, crew, or 14.22 supplies during the course of an excursion cruise; for 14.23 mechanical problems, adverse weather, or other conditions 14.24 adversely affecting safe navigation; during the duration of the 14.25 problem or condition; or as authorized by the board during the 14.26 off season. 14.27 Sec. 11. [349C.11] [ADMISSION FEE; LOCAL FEES.] 14.28 Subdivision 1. [ADMISSION FEE.] An excursion boat licensee 14.29 shall pay to the board an admission fee for each person 14.30 embarking on an excursion gambling boat with a ticket of 14.31 admission. The board shall set the admission fee. If tickets 14.32 are issued that are good for more than one excursion, the 14.33 admission fee shall be paid for each person using the ticket on 14.34 each excursion that the ticket is used. 14.35 Subd. 2. [FREE PASSES.] If free passes or complimentary 14.36 admission tickets are issued, the licensee shall pay the same 15.1 fee on these passes or complimentary tickets as if they were 15.2 sold at the regular and usual admission rate. 15.3 The excursion boat licensee may issue fee-free passes to 15.4 actual and necessary officials and employees of the licensee or 15.5 other persons actually working on the excursion gambling boat. 15.6 The issuance of fee-free passes is subject to the rules of the 15.7 board and a list of all persons to whom the fee-free passes are 15.8 issued shall be filed with the board. 15.9 Subd. 3. [LOCAL FEE.] In addition to the admission fee 15.10 charged under subdivision 1, a city may adopt, by ordinance, an 15.11 admission fee not exceeding 50 cents for each person embarking 15.12 on an excursion gambling boat docked within the city. The 15.13 admission revenue received by a city shall be credited to the 15.14 city general fund. 15.15 Subd. 4. [DETERMINATION OF FEES.] In determining the 15.16 license fees and state admission fees to be charged as provided 15.17 under this section and section 4, the board shall use the amount 15.18 appropriated to the board as the basis for determining the 15.19 amount of revenue to be raised from the license fees and 15.20 admission fees. 15.21 Subd. 5. [PROHIBITED TAXES.] No other license tax, permit 15.22 tax, occupation tax, excise tax, excursion fee, or taxes on fees 15.23 shall be levied, assessed, or collected from a licensee relating 15.24 to gambling excursions or admission charges by a political 15.25 subdivision, except as provided in this chapter. 15.26 Sec. 12. [349C.12] [WAGERING TAX; RATE; ALLOCATIONS.] 15.27 (a) A tax is imposed on the adjusted gross receipts 15.28 received annually from gambling games authorized under this 15.29 chapter at the rate of ten percent on the first $1,000,000 of 15.30 adjusted gross receipts, at the rate of 20 percent on the next 15.31 $2,000,000 of adjusted gross receipts, and at the rate of 25 15.32 percent on any amount of adjusted gross receipts over 15.33 $3,000,000. The taxes imposed by this section must be paid by 15.34 the licensee to the state treasurer within ten days after the 15.35 close of the day when the wagers were made and must be 15.36 distributed as provided in this section. 16.1 (b) One percent of the adjusted gross receipts must be 16.2 remitted to the treasurer of the city in which the dock of 16.3 origination is located and must be deposited in the general fund 16.4 of the city. 16.5 (c) The remaining amount of the adjusted gross receipts tax 16.6 must be credited to the general fund of the state. One-half of 16.7 this amount is appropriated to the commissioner of the Minnesota 16.8 housing finance agency for the purposes of preserving or 16.9 rehabilitating existing housing stock and providing 16.10 single-family home ownership and affordable rental housing 16.11 opportunities. 16.12 Sec. 13. [349C.13] [LICENSEES; RECORDS; REPORTS; 16.13 SUPERVISION.] 16.14 Subdivision 1. [RECORDS.] The books and records of a 16.15 license must clearly show all of the following: 16.16 (1) the total number of admissions to gambling excursions 16.17 conducted by the licensee on each day, including the number of 16.18 admissions upon free passes or complimentary tickets; 16.19 (2) the amount received daily from admission fees; and 16.20 (3) the total amount of money wagered during each excursion 16.21 day and the adjusted gross receipts for the day. 16.22 Subd. 2. [REPORTS.] The licensee shall furnish to the 16.23 board reports and information as the board may require with 16.24 respect to its activities. The gross receipts and adjusted 16.25 gross receipts from gambling must be separately handled and 16.26 accounted for from all other money received from operation of an 16.27 excursion gambling boat. The board may designate a 16.28 representative to board a licensed excursion gambling boat, who 16.29 shall have full access to all places within the enclosure of the 16.30 boat, who shall directly supervise the handling and accounting 16.31 of all gross receipts and adjusted gross receipts from gambling, 16.32 and who shall supervise and check the admissions. The 16.33 compensation of a representative must be fixed by the board but 16.34 must be paid by the licensee. 16.35 Subd. 3. [PUBLIC RECORDS.] The books and records kept by a 16.36 licensee as provided by this section are public records and the 17.1 examination, publication, and dissemination of the book and 17.2 records are governed by chapter 13. 17.3 Sec. 14. [349C.14] [AUDIT OF LICENSEE'S OPERATIONS.] 17.4 Within 90 days after the end of each month, the licensee 17.5 shall transmit to the board an audit of the financial 17.6 transactions and condition of the licensee's operations 17.7 conducted under this chapter. Additionally, within 90 days 17.8 after the end of the licensee's fiscal year, the licensee shall 17.9 transmit to the board an audit of the financial transactions and 17.10 condition of the licensee's total operations. All audits must 17.11 be conducted by certified public accountants registered or 17.12 licensed in the state. 17.13 Sec. 15. [349C.15] [ANNUAL REPORT OF BOARD.] 17.14 The board shall make an annual report to the governor for 17.15 the period ending December 31 of each year. The report must 17.16 include an account of the board's actions, its financial 17.17 position and results of operation under this chapter, the 17.18 practical results attained under this chapter, and any 17.19 recommendations for legislation that the board considers 17.20 necessary. 17.21 Sec. 16. [349C.16] [PROHIBITED ACTIVITIES; PENALTIES.] 17.22 Subdivision 1. [MISDEMEANOR.] A person is guilty of a 17.23 misdemeanor for any of the following: 17.24 (1) operating a gambling excursion where wagering is used 17.25 or to be used without a license issued by the board; 17.26 (2) operating a gambling excursion where wagering is 17.27 permitted other than in the manner specified by section 10; 17.28 (3) acting, or employing a person to act, as a shill or 17.29 decoy to encourage participation in a gambling game; 17.30 (4) knowingly permitting a person under the age of 21 years 17.31 to make a wager; or 17.32 (5) wagering or accepting a wager at any location outside 17.33 the excursion gambling boat. 17.34 Subd. 2. [FELONY.] A person is guilty of a felony and, in 17.35 addition, shall be barred for life from excursion gambling boats 17.36 under the jurisdiction of the board, if the person does any of 18.1 the following: 18.2 (1) offers, promises, or gives anything of value or benefit 18.3 to a person who is connected with an excursion gambling boat 18.4 operator including an officer or employee of a licensee or 18.5 holder of an occupational license under an agreement or 18.6 arrangement or with the intent that the promise or thing of 18.7 value or benefit will influence the actions of the person to 18.8 whom the offer, promise, or gift was made in order to affect or 18.9 attempt to affect the outcome of a gambling game, or to 18.10 influence official action of a member of the board; 18.11 (2) solicits or knowingly accepts or receives a promise of 18.12 anything of value or benefit while the person is connected with 18.13 an excursion gambling boat including an officer or employee of a 18.14 licensee, or holder of an occupational license, under an 18.15 understanding or arrangement or with the intent that the promise 18.16 or thing of value or benefit will influence the actions of the 18.17 person to affect or attempt to affect the outcome of a gambling 18.18 game, or to influence official action of a member of the board; 18.19 (3) uses a devise to assist in any of the following: 18.20 (i) in projecting the outcome of the game; 18.21 (ii) in keeping track of the cards played; 18.22 (iii) in analyzing the probability of the occurrence of an 18.23 event relating to the gambling game; or 18.24 (iv) in analyzing the strategy for playing or betting to be 18.25 used in the game except as permitted by the board; 18.26 (4) cheats at a gambling game; 18.27 (5) manufactures, sells, or distributes any cards, chips, 18.28 dice, game, or device that is intended to be used to violate 18.29 this chapter; 18.30 (6) instructs a person in cheating or in the use of a 18.31 device for that purpose with the knowledge or intent that the 18.32 information or use conveyed may be employed to violate this 18.33 chapter; 18.34 (7) alters or misrepresents the outcome of a gambling game 18.35 on which wagers have been made after the outcome is made sure 18.36 but before it is revealed to the players; 19.1 (8) places a bet after acquiring knowledge, not available 19.2 to all players, of the outcome of the gambling game that is the 19.3 subject of the bet or to aid a person in acquiring the knowledge 19.4 for the purpose of placing a bet contingent on that outcome; 19.5 (9) claims, collects, or takes, or attempts to claim, 19.6 collect, or take, money or anything of value in or from the 19.7 gambling games, with intent to defraud, without having made a 19.8 wager contingent on winning a gambling game, or claims, 19.9 collects, or takes an amount of money or thing of value of 19.10 greater value than the amount won; 19.11 (10) knowingly entices or induces a person to go to any 19.12 place where a gambling game is being conducted or operated in 19.13 violation of this chapter with the intent that the other person 19.14 plays or participates in that gambling game; 19.15 (11) uses counterfeit chips or tokens in a gambling game; 19.16 (12) knowingly uses, other than chips, tokens, coin, or 19.17 other methods or credit approved by the commission, legal tender 19.18 of the United States of America, or uses coin not of the 19.19 denomination as the coin intended to be used in the gambling 19.20 games; 19.21 (13) has in the person's possession any device intended to 19.22 be used to violate this chapter; or 19.23 (14) has in the person's possession, except a gambling 19.24 licensee or employee of a gambling licensee acting in 19.25 furtherance of the employee's employment, any key or device 19.26 designed for the purpose of opening, entering, or affecting the 19.27 operation of a gambling game, drop box, or electronic or 19.28 mechanical device connected with the gambling game drop box, or 19.29 an electronic or mechanical device connected with the gambling 19.30 game or for removing coins, tokens, chips, or other contents of 19.31 a gambling game. 19.32 Subd. 3. [REBUTTABLE PRESUMPTION.] The possession of more 19.33 than one of the devices described in subdivision 2, clause (3), 19.34 (5), (13), or (14), is a rebuttable presumption that the 19.35 possessor intended to use the devices for cheating. 19.36 Subd. 4. [EXCHANGES PROHIBITED.] Except for wagers on 20.1 gambling games or exchanges for money as provided in section 10, 20.2 a licensee who exchanges tokens, chips, or other forms of credit 20.3 to be used on gambling games for anything of value is guilty of 20.4 a misdemeanor. 20.5 Sec. 17. [349C.17] [FORFEITURE OF PROPERTY.] 20.6 Subdivision 1. [PROPERTY.] (a) Anything of value, 20.7 including all traceable proceeds such as real and personal 20.8 property, money, negotiable instruments, securities, and 20.9 conveyances, is subject to forfeiture to the state if the item 20.10 was used for any of the following: 20.11 (1) in exchange for a bribe intended to affect the outcome 20.12 of a gambling game; or 20.13 (2) in exchange for or to facilitate a violation of this 20.14 chapter. 20.15 (b) All money, coin, and currency found in close proximity 20.16 to wagers, or to records of wagers, are presumed forfeited. The 20.17 burden of proof is upon the claimant of the property to rebut 20.18 this presumption. 20.19 Subd. 2. [EXEMPTION.] Subdivision 1 does not apply if the 20.20 act or omission which would give rise to the forfeiture was 20.21 committed or omitted without the owner's knowledge or consent. 20.22 Sec. 18. [349C.18] [DISTRIBUTORS AND MANUFACTURERS; 20.23 LICENSES.] 20.24 Subdivision 1. [APPLICATION.] A manufacturer or 20.25 distributor of gambling games or implements of gambling shall 20.26 annually apply for a license on a form prescribed by the board 20.27 before the first day of April in each year and shall submit the 20.28 appropriate license fee. An applicant shall provide the 20.29 necessary information as the board requires. The license fee 20.30 for a distributor is $1,000, and the license fee for a 20.31 manufacturer is $250. The license fees shall be credited to the 20.32 special account provided for in section 5. 20.33 Subd. 2. [PURCHASE OF GAMBLING GAMES AND IMPLEMENTS.] A 20.34 licensee shall acquire all gambling games or implements of 20.35 gambling from a distributor licensed under this chapter. A 20.36 licensee shall not sell or give gambling games or implements of 21.1 gambling to another licensee. A licensee shall not be a 21.2 manufacturer or distributor of gambling games or implements of 21.3 gambling. 21.4 Subd. 3. [VIOLATIONS.] The board may suspend or revoke the 21.5 license of a distributor or manufacturer for a violation of this 21.6 chapter or a rule adopted under this chapter committed by the 21.7 distributor or manufacturer or an officer, director, employee, 21.8 or agent of the manufacturer or distributor. 21.9 Subd. 4. [REPRESENTATIVE.] A manufacturer or distributor 21.10 of gambling games who has been granted a license under this 21.11 section shall have a representative within this state to take 21.12 delivery of gambling games or implements of gambling prior to 21.13 delivery to a licensee. The manufacturer or distributor shall 21.14 provide the board with a copy of the invoice showing the items 21.15 shipped and a copy of the bill of lading. When received, the 21.16 gambling games or implements of gambling shall be stored in a 21.17 public warehouse in this state until delivered to the licensee 21.18 or, after delivery is complete, the shipment may be transferred 21.19 to a licensee. 21.20 Sec. 19. [APPROPRIATION.] 21.21 $....... is appropriated from the general fund to the 21.22 excursion boat gambling board for the purpose of administering 21.23 sections 1 to 18. 21.24 ARTICLE 2 21.25 ENFORCEMENT 21.26 Section 1. Minnesota Statutes 2000, section 299L.02, is 21.27 amended by adding a subdivision to read: 21.28 Subd. 3a. [EXCURSION BOAT GAMBLING INVESTIGATIONS.] (a) 21.29 The director shall conduct background investigations as provided 21.30 by law on all applicants for licenses issued by the Minnesota 21.31 excursion boat gambling commission. 21.32 (b) The director shall, upon the request of the director of 21.33 the Minnesota excursion boat gambling commission, or when the 21.34 director believes it to be reasonable and necessary, investigate 21.35 the activities of a licensee to determine the licensee's 21.36 compliance with the law and rules of the commission.