Minnesota Session Laws - 1983, Regular Session

  

                         Laws of Minnesota 1983 

                         CHAPTER 214--H.F.No. 77
           An act relating to horse racing; creating a Minnesota 
          racing commission and providing for its membership, 
          powers, and duties; authorizing the licensing of 
          persons to operate racetracks, conduct horse racing, 
          engage in certain occupations, and conduct pari-mutuel 
          betting on horse racing; prescribing taxes and license 
          fees; establishing a Minnesota breeders fund; defining 
          sports bookmaking and making it a felony; clarifying 
          what is not a lottery; providing for the forfeiture of 
          certain gambling devices, prizes, and proceeds; 
          providing penalties; appropriating money; amending 
          Minnesota Statutes 1982, sections 10A.09, subdivisions 
          1 and 5; 38.04; 340.11, by adding a subdivision; 
          609.75, subdivisions 1 and 3, and by adding a 
          subdivision; 609.76; 609.761; proposing new law coded 
          as Minnesota Statutes, chapter 240; proposing new law 
          coded in Minnesota Statutes, chapter 609.  
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  [240.01] [DEFINITIONS.] 
    Subdivision 1.  [TERMS.] For the purposes of this act the 
terms defined in this section have the meanings given them.  
    Subd. 2.  [HORSE RACING.] "Horse racing" is any form of 
horse racing in which horses carry a rider or pull a sulky.  
    Subd. 3.  [PERSON.] "Person" is an individual, firm, 
association, partnership, corporation, trustee, or legal 
representative, and any licensee, participant, or patron.  
    Subd. 4.  [COMMISSION.] "Commission" is the Minnesota 
racing commission.  
    Subd. 5.  [PARI-MUTUEL BETTING.] "Pari-mutuel betting" is 
the system of betting on horse races where those who bet on 
horses that finish in the position or positions for which bets 
are taken share in the total amounts bet, less deductions 
required or permitted by law.  
    Subd. 6.  [BREAKAGE.] "Breakage" is the odd cents of all 
money to be distributed based on each dollar bet exceeding a sum 
equal to the next lowest multiple of ten.  
    Subd. 7.  [STRAIGHT POOLS AND BETS.] "Straight pool" is a 
licensed pari-mutuel pool in which each ticket represents a bet 
to win, place, or show.  A "straight bet" is a bet in a straight 
pool.  
    Subd. 8.  [MULTIPLE POOLS AND BETS.] "Multiple pool" is a 
licensed pari-mutuel pool other than a straight pool.  A 
"multiple bet" is a bet in a multiple pool.  
    Subd. 9.  [LICENSED RACETRACK.] "Licensed racetrack" is a 
racetrack at which horse racing is conducted on the premises and 
which holds a class A or class D license issued by the 
commission.  
    Subd. 10.  [RACING DAY.] "Racing day" is a day assigned by 
the commission as a racing day, and on which racing is conducted.
    Subd. 11.  [RACING MEETING.] "Racing meeting" is a series 
of days in which racing days are not separated by more than five 
nonracing days.  
    Sec. 2.  [240.02] [RACING COMMISSION.] 
    Subdivision 1.  [COMMISSION CREATED.] A Minnesota racing 
commission is established with the powers and duties specified 
in this act.  The commission consists of nine members appointed 
by the governor with the advice and consent of the senate.  Not 
more than five of the members may belong to the same political 
party.  The governor shall designate the chairman of the 
commission.  Of the members first appointed, three are for terms 
expiring June 30, 1985, three are for terms expiring June 30, 
1987, and three are for terms expiring June 30, 1989.  After the 
expiration of the initial term, appointments are for terms of 
six years.  An appointment to fill a vacancy in an unexpired 
term is for the remainder of the term and is with the advice and 
consent of the senate.  
    Subd. 2.  [QUALIFICATIONS.] A member of the commission must 
have been a resident of Minnesota for at least five years before 
appointment, and must have a background and experience as would 
qualify for membership on the commission.  A member must, before 
taking his or her place on the commission, file a bond in the 
principal sum of $100,000 payable to the state, conditioned upon 
the faithful performance of his or her duties.  No commission 
member, nor any member of his or her immediate family, may hold 
a license issued by the commission or have a direct or indirect 
financial interest in a corporation, partnership, or association 
which holds a license issued by the commission.  
    Subd. 3.  [COMPENSATION.] The compensation of commission 
members is $35 per day spent on commission activities, when 
authorized by the commission, plus expenses in the same manner 
and amount as provided in the commissioner's plan adopted 
according to section 43A.18, subdivision 2.  
    Subd. 4.  [REMOVAL; VACANCIES.] The removal of commission 
members is as provided in section 15.0575.  
    Subd. 5.  [ACTIONS.] The commission may sue and be sued in 
its own name but no action may be brought against the commission 
or any of its members for actions taken in good faith in the 
performance of their duties.  Suits and actions may be commenced 
against the commission or any of its members in any court of 
competent jurisdiction in this state by the service on the 
secretary of state of any summons, process, or pleadings 
authorized by the laws of this state.  If any summons, process, 
or pleadings is served upon the secretary of state, it must be 
by duplicate copies.  One copy must be retained in the office of 
the secretary of state and the other copy must be forwarded 
immediately by certified mail to the chairman of the commission 
at the current address of the commission.  The executive 
secretary of the commission shall inform the secretary of state 
of the mailing address of the commission and any changes in it. 
The attorney general is the legal counsel for the commission.  
    Subd. 6.  [ANNUAL REPORT.] The commission shall on February 
15 of each year submit a report to the governor and legislature 
on its activities, organizational structure, receipts and 
disbursements, and recommendations for changes in the laws 
relating to racing and pari-mutuel betting.  
    Sec. 3.  [240.03] [COMMISSION POWERS AND DUTIES.] 
    The commission has the following powers and duties:  
    (1) to regulate horse racing in Minnesota to ensure that it 
is conducted in the public interest;  
    (2) to issue licenses as provided in this act;  
    (3) to enforce all laws and rules governing horse racing;  
    (4) to collect and distribute all taxes provided for in 
this act;  
    (5) to conduct necessary investigations and inquiries and 
compel the submission of information, documents, and records it 
deems necessary to carry out its duties;  
    (6) to supervise the conduct of pari-mutuel betting on 
horse racing;  
    (7) to employ and supervise personnel under this act;  
    (8) to determine the number of racing dates to be held in 
the state and at each track;  
    (9) to take all necessary steps to ensure the integrity of 
racing in Minnesota.  
    Sec. 4.  [240.04] [EMPLOYEES.] 
    Subdivision 1.  [EXECUTIVE SECRETARY.] The commission shall 
appoint an executive secretary, who is its chief administrative 
officer and who serves at its pleasure in the unclassified 
service.  He shall devote full time to his duties, which are:  
    (a) to take and preserve records of all proceedings before 
the commission, maintain its books, documents, and records, and 
make them available for public inspection as the commission 
directs;  
    (b) if so designated by the commission, to act as a hearing 
officer in hearings which need not be conducted under the 
Administrative Procedure Act to conduct hearings, receive 
testimony and exhibits, and certify the record of proceedings to 
the commission;  
    (c) to act as the commission's chief personnel officer and 
supervise the employment, conduct, duties, and discipline of 
commission employees; and 
    (d) to perform other duties as directed by the commission.  
    Subd. 2.  [INSPECTOR OF PARI-MUTUELS.] The commission may 
employ an inspector of pari-mutuels who serves in the 
unclassified service at the commission's pleasure.  He shall, 
while employed by the commission, devote full time to his 
duties, which are:  
    (a) to supervise all forms of pari-mutuel betting on horse 
racing in the state;  
    (b) to inspect all machinery;  
    (c) to make reports on pari-mutuel betting as the 
commission directs;  
    (d) subject to commission approval, to appoint deputy 
inspectors to perform duties the commission designates; and 
    (e) to perform other duties as directed by the commission.  
    If no inspector of pari-mutuels is appointed his duties are 
assigned to the executive secretary.  The commission may 
contract with outside services or personnel to assist the 
executive secretary in the performance of these duties.  
    Subd. 3.  [CHIEF OF SECURITY.] The commission may appoint a 
chief of racing security to serve in the unclassified service at 
the commission's pleasure.  He shall devote full time to his 
duties while employed by the commission.  The chief of racing 
security shall enforce all laws and commission rules relating to 
the security and integrity of racing.  He and all other persons 
designated by the commission as security officers have free and 
open access to all areas of all facilities the commission 
licenses and may search without a search warrant any part of a 
licensed racetrack and the person of any licensee of the 
commission on the premises.  The chief of security may order a 
licensee to take, at the licensee's expense, security measures 
he determines necessary to protect the integrity of racing, but 
the order may be appealed to the commission.  Nothing in chapter 
240 prohibits law enforcement authorities and agents from 
entering, in the performance of their duties, a premises 
licensed under this act.  
    If no chief of racing security is appointed his duties are 
assigned to the executive secretary.  The commission may 
contract with outside services or personnel to assist the 
executive secretary in the performance of these duties.  
    Subd. 4.  [MEDICAL SERVICES.] The commission may appoint a 
medical officer who must be a doctor of veterinary medicine and 
who serves at its pleasure in the unclassified service.  He 
shall, while employed by the commission, devote full time to his 
duties, which are:  
    (a) to supervise the formulation, administration, and 
evaluation of all medical tests the commission's rules require 
or authorize;  
    (b) to advise the commission on all aspects of veterinary 
medicine relating to its powers and duties; and 
    (c) to supervise all personnel involved in medical testing, 
subject to the supervision of the executive secretary.  
    The commission may obtain medical services as required by 
contract with an institution which teaches animal health 
sciences within the state.  If no medical officer is appointed, 
his duties may be assigned to the executive secretary.  
    Subd. 5.  [OTHER EMPLOYEES.] Subject to applicable laws, 
the commission shall employ and assign duties to other officers, 
employees, and agents as it deems necessary to discharge its 
functions.  
    Subd. 6.  [COMPENSATION.] The compensation of all 
commission employees shall be as provided in chapter 43A.  
    Subd. 7.  [ASSISTANCE.] The commission may request 
assistance from any department or agency of the state in 
fulfilling its duties, and shall make appropriate reimbursement 
for all such assistance.  
    Sec. 5.  [240.05] [LICENSES; CLASSES.] 
    Subdivision 1.  [CLASSES.] The commission may issue four 
classes of licenses:  
    (a) class A licenses, for the ownership and operation of a 
racetrack with horse racing on which pari-mutuel betting is 
conducted;  
    (b) class B licenses, for the sponsorship and management of 
horse racing on which pari-mutuel betting is conducted;  
    (c) class C licenses, for the privilege of engaging in 
certain occupations related to horse racing; and 
    (d) class D licenses, for the conduct of pari-mutuel horse 
racing by county agricultural societies or associations.  
    No person may engage in any of the above activities without 
first having obtained the appropriate license from the 
commission.  
    Subd. 2.  [FORMS.] All application forms for licenses must 
contain a statement to the effect that by accepting a license 
from the commission a licensee consents to having his property 
or person subject to inspection at any time by the chief of 
racing security or by security officers designated by the 
commission.  
    Subd. 3.  [POLICY.] It is the intent of the legislature 
that authority granted by law to the commission to issue 
licenses not be construed as requiring the commission to issue 
any license.  
    Sec. 6.  [240.06] [RACETRACK LICENSES.] 
    Subdivision 1.  [APPLICATION.] The commission may issue one 
or more class A licenses, but not more than one to any one 
person.  An application for a class A license must be on a form 
the commission prescribes and must be accompanied by detailed 
plans and specifications of the track, buildings, fences, and 
other improvements.  The application must contain:  
    (a) the name and address of the applicant and, if it is a 
corporation, the names of all officers, directors, and 
shareholders of the corporation and any of its holding 
corporations;  
    (b) if required by the commission, the names of any person 
or persons holding directly, indirectly, or beneficially an 
interest of any kind in the applicant or any of its holding 
corporations, whether the interest is financial, administrative, 
policy-making, or supervisory;  
    (c) a statement of the assets and liabilities of the 
applicant;  
    (d) an affidavit executed by the applicant setting forth 
that no officer, director, or other person with a present or 
future direct or indirect financial or management interest in 
the racetrack, to the best of the applicant's knowledge:  
    (1) is in default in the payment of an obligation or debt 
to the state under this act;  
    (2) has ever been convicted of a felony in a state or 
federal court or has a state or federal felony charge pending;  
    (3) is or has been connected with or engaged in any illegal 
business;  
    (4) has ever been found guilty of fraud or 
misrepresentation in connection with racing or breeding; 
     (5) has ever been found guilty of a violation of a law or 
rule relating to horse racing, pari-mutuel betting or any other 
form of gambling which is a serious violation as defined by the 
commission's rules; or 
     (6) has ever knowingly violated a rule or order of the 
commission or a law of Minnesota relating to racing;  
    (e) an irrevocable consent statement, to be signed by the 
applicant, which states that suits and actions relating to the 
subject matter of the application or acts or omissions arising 
from it may be commenced against the applicant in any court of 
competent jurisdiction in this state by the service on the 
secretary of state of any summons, process, or pleadings 
authorized by the laws of this state.  If any summons, process, 
or pleadings is served upon the secretary of state, it must be 
by duplicate copies.  One copy must be retained in the office of 
the secretary of state and the other copy must be forwarded 
immediately by certified mail to the address of the applicant, 
as shown by the records of the commission; and 
     (f) an affirmative action plan establishing goals and 
timetables consistent with the Minnesota Human Rights Act, 
chapter 363.  
    Subd. 2.  [HEARINGS.] Before granting a class A license 
application the commission shall conduct one or more public 
hearings in the area where the racetrack is or will be located. 
The commission shall also request comments on the application 
from the city council or town board of the city or town where 
the track is or will be located, or from the county board if it 
is to be located outside a city or town and from the appropriate 
regional development commission or the metropolitan council, as 
the case may be.  
    Subd. 3.  [INVESTIGATION.] Before granting a class A 
license the commission shall conduct, or request the bureau of 
criminal apprehension to conduct, a comprehensive background and 
financial investigation of the applicant and sources of 
financing.  The commission may charge an applicant an 
investigation fee to cover the cost of the investigation, and 
shall from this fee reimburse the bureau for its share of the 
cost of the investigation.  The commission has access to all 
criminal history data compiled by the bureau of criminal 
apprehension on class A licensees and applicants.  
    Subd. 4.  [LICENSE ISSUANCE.] If after considering the 
information received at the hearing or hearings and the comments 
requested under subdivision 2, the commission determines that 
the license will not adversely affect the public health, 
welfare, and safety, that the racetrack will be operated in 
accordance with all applicable laws and rules, that the license 
will not create a competitive situation that will adversely 
affect racing and the public interest, and that the applicant is 
financially able to operate a licensed racetrack, it may issue a 
class A license to the applicant.  The license is effective 
until revoked or suspended by the commission or relinquished by 
the licensee.  
    Subd. 5.  [PROHIBITED LOCATIONS.] A class A license may not 
be issued to any location where the operation of a racetrack is 
prohibited by a valid local zoning ordinance.  Not more than one 
class A license may be issued by the commission within the 
seven-county metropolitan area.  
    Subd. 6.  [CHANGES IN OWNERSHIP OR MANAGEMENT.] If a change 
in the officers, directors, shareholders, or other persons with 
a present or future direct or indirect financial or management 
interest in the licensee, or a change of ownership of more than 
five percent of the licensee's shares is made after the 
application is filed or the license issued, the applicant or 
licensee must notify the commission of the changes within five 
days of their occurrence and provide the affidavit required by 
subdivision 1, clause (d).  
    Subd. 7.  [LICENSE SUSPENSION AND REVOCATION.] The 
commission may revoke a class A license for a violation of law, 
order, or rule which in the commission's opinion adversely 
affects the integrity of horse racing in Minnesota, or for an 
intentional false statement made in a license application, or 
for a willful failure to pay any money required to be paid by 
this act.  
    The commission may suspend a class A license for up to one 
year for a violation of law, order, or rule which in the 
commission's opinion adversely affects the integrity of horse 
racing in Minnesota, and may suspend a class A license 
indefinitely if it determines that the licensee has as an 
officer, director, shareholder, or other person with a direct, 
indirect, or beneficial interest a person who is in the 
commission's opinion inimical to the integrity of horse racing 
in Minnesota or who cannot be certified under subdivision 1, 
clause (d).  
    A license revocation or suspension under this subdivision 
is a contested case under sections 14.57 to 14.70 of the 
Administrative Procedure Act, and is in addition to criminal 
penalties imposed for a violation of law or rule.  
    Subd. 8.  [WORK AREAS.] A class A licensee must provide at 
no cost to the commission suitable work areas for commission 
members, officers, employees, and agents who are directed by the 
commission to supervise and control racing at the licensed 
racetrack.  
    Sec. 7.  [240.07] [RACING LICENSES.] 
    Subdivision 1.  [APPLICATION.] The commission may issue one 
or more class B licenses for the sponsorship and management of 
horse racing at licensed racetracks.  An application for a class 
B license must be on a form the commission prescribes, and must 
be accompanied by a bond in the principal amount of $500,000 
payable to the state of Minnesota conditioned on the licensee's 
payment of all fees, taxes, and other money due and payable 
under this act, including horse owner's purses and payouts on 
winning pari-mutuel tickets.  
    The application must contain:  
    (a) the name and address of the applicant and, if it is a 
corporation or association, the names of all officers, 
directors, and shareholders, including those of any of its 
holding companies;  
    (b) if required by the commission, the names of any person 
or persons holding, directly, indirectly, or beneficially, an 
interest of any kind in the applicant or any of its holding 
companies, whether the interest is financial, administrative, 
policy-making, or supervisory;  
    (c) a statement of the assets and liablities of the 
applicant;  
    (d) an affidavit of the type described in section 6, 
subdivision 1, clause (d);  
    (e) an irrevocable consent statement, to be signed by the 
applicant, which states that suits and actions relating to the 
subject matter of the application or acts or omissions arising 
from it may be commenced against the applicant in any court of 
competent jurisdiction in this state by the service on the 
secretary of state of any summons, process, or pleadings 
authorized by the laws of this state.  If any summons, process, 
or pleadings is served upon the secretary of state, it must be 
by duplicate copies.  One copy must be retained in the office of 
the secretary of state and the other copy must be forwarded 
immediately by certified mail to the address of the applicant, 
as shown by the records of the commission; and 
    (f) an affirmative action plan establishing goals and 
timetables consistent with the Minnesota Human Rights Act, 
chapter 363.  
    Subd. 2.  [HEARINGS; INVESTIGATIONS.] Before granting an 
initial class B license the commission shall hold at least one 
public hearing on the license.  Comprehensive investigations 
must be conducted and their costs paid in the manner prescribed 
by section 6, subdivision 3.  The commission has access to all 
criminal history data compiled by the bureau of criminal 
apprehension on class B licensees and applicants.  
    Subd. 3.  [LICENSE ISSUANCE.] If after considering the 
information received from the hearing and investigations, the 
commission determines that the applicant will conduct horse 
racing in accordance with all applicable laws and rules, will 
not adversely affect the public health, welfare, and safety, 
that the license will not create a competitive situation that 
will adversely affect racing and the public interest and that 
the applicant is fit to sponsor and manage racing, the 
commission may issue a class B license.  The license is for a 
period of one year.  
    Subd. 4.  [RENEWAL.] On making the same determination as in 
subdivision 3, the commission may renew a class B license 
without a hearing unless it determines a hearing to be necessary.
    Subd. 5.  [CHANGES IN OWNERSHIP.] If a change in the 
officers, directors, or other persons with a direct or indirect 
financial or management interest in the licensee, or a change of 
ownership of more than five percent of the licensee's shares is 
made after the initial application or license issuance, the 
applicant or licensee must notify the commission of the changes 
within five days of their occurrence and provide the affidavit 
required in subdivision 1.  
    Subd. 6.  [LICENSE SUSPENSION AND REVOCATION.] Suspension, 
revocation, and refusal to renew a class B license is as 
provided in section 6, subdivision 7.  A license suspension or 
revocation or a refusal to renew a class B license, is a 
contested case under section 14.57 to 14.70 of the 
Administrative Procedure Act, and is in addition to criminal 
penalties imposed for a violation of law or rule.  
    Subd. 7.  [MULTIPLE LICENSES.] A person may simultaneously 
hold one class A and one class B license.  
    Sec. 8.  [240.08] [OCCUPATION LICENSES.] 
    Subdivision 1.  [AUTHORITY.] The commission may issue class 
C occupational licenses to persons who wish to be employed in 
horse racing where pari-mutuel betting is conducted as:  
    (a) horse owners or lessees;  
    (b) jockeys or drivers;  
    (c) exercise workers;  
    (d) grooms;  
    (e) trainers and their assistants;  
    (f) pari-mutuel personnel;  
    (g) security officers;  
    (h) other occupations the commission by rule determines 
require licensing to ensure the integrity of horse racing in 
Minnesota.  
    Subd. 2.  [APPLICATION.] An application for a class C 
license must be on a form the commission prescribes and must be 
accompanied by an affidavit of qualification that the applicant: 
    (a) is not in default in the payment of an obligation or 
debt to the state under this act;  
    (b) has never been convicted of a felony in a state or 
federal court and does not have a state or federal felony charge 
pending;  
    (c) is not and never has been connected with or engaged in 
an illegal business;  
    (d) has never been found guilty of fraud or 
misrepresentation in connection with racing or breeding;  
    (e) has never been found guilty of a violation of law or 
rule relating to horse racing, pari-mutuel betting or any other 
form of gambling which is a serious violation as defined by the 
commission's rules; and 
    (f) has never knowingly violated a rule or order of the 
commission or a law of Minnesota relating to racing.  
     The application must also contain an irrevocable consent 
statement, to be signed by the applicant, which states that 
suits and actions relating to the subject matter of the 
application or acts or omissions arising from it may be 
commenced against the applicant in any court of competent 
jurisdiction in this state by the service on the secretary of 
state of any summons, process, or pleadings authorized by the 
laws of this state.  If any summons, process, or pleadings is 
served upon the secretary of state, it must be by duplicate 
copies.  One copy must be retained in the office of the 
secretary of state and the other copy must be forwarded 
immediately by certified mail to the address of the applicant, 
as shown by the records of the commission.  
    Subd. 3.  [INVESTIGATIONS.] The commission shall 
investigate each applicant for a class C license to the extent 
it deems necessary, and may request the assistance of and may 
reimburse the bureau of criminal apprehension in investigating 
applicants.  The commission may by rule require that an 
applicant be fingerprinted or furnish his fingerprints. 
Investigations must be conducted and their costs paid in the 
manner prescribed by section 6, subdivision 3.  The commission 
may cooperate with national and international organizations and 
agencies in conducting investigations.  The commission may by 
rule provide for examining the qualifications of an applicant 
for the license for which he is applying.  The commission has 
access to all criminal history data compiled by the bureau of 
criminal apprehension on class C applicants and licensees.  
    Subd. 4.  [LICENSE ISSUANCE AND RENEWAL.] If the commission 
determines that the applicant is qualified for the occupation 
for which licensing is sought and will not adversely affect the 
public health, welfare, and safety or the integrity of racing in 
Minnesota, it may issue a class C license to the applicant.  If 
it makes a similar finding for a renewal of a class C license it 
may renew the license.  Class C licenses are effective for one 
year.  
    Subd. 5.  [REVOCATION AND SUSPENSION.] The commission may 
revoke a class C license for a violation of law or rule which in 
the commission's opinion adversely affects the integrity of 
horse racing in Minnesota, or for an intentional false statement 
made in a license application.  
    The commission may suspend a class C license for up to one 
year for a violation of law, order or rule.  
    The commission may delegate to its designated agents the 
authority to impose suspensions of class C licenses, and the 
suspension may be appealed to the commission according to its 
rules.  
    A license revocation or suspension is a contested case 
under sections 14.57 to 14.70 of the Administrative Procedure 
Act and is in addition to criminal penalties imposed for a 
violation of law or rule.  
    Sec. 9.  [240.09] [COUNTY FAIR LICENSES.] 
    Subdivision 1.  [APPLICATION.] The commission may issue 
class D licenses to county agricultural societies or 
associations incorporated under chapter 38 or nonprofit 
corporations in existence on April 21, 1951 and operating fairs, 
to conduct and manage, on their own fairgrounds, horse racing on 
which pari-mutuel betting is conducted.  An application for a 
class D license must be on a form the commission prescribes and 
must be accompanied by a certified copy of a resolution of the 
county board of the county where racing is to be conducted 
stating that it has reviewed the license application and does 
not object to it.  An application for a class D license must be 
accompanied by detailed plans and specifications of the track, 
buildings, fences, and other improvements.  
    Subd. 2.  [OCCUPATIONAL LICENSES.] A person who 
participates in the management or conduct of horse racing or 
pari-mutuel betting for a county fair holding a class D license 
who is in an occupation listed in section 8, subdivision 1 must 
have a class C license from the commission except for active 
members, as defined in section 349.12, of nonprofit 
organizations who act without compensation as concession workers 
or pari-mutuel clerks.  
    Subd. 3.  [HEARING.] Before granting an initial application 
for a class D license, the commission must hold at least one 
public hearing in the county where the license is to be issued, 
and if the racetrack to be licensed is within a city, it must 
also request comments on the application from the city council.  
    Subd. 4.  [ISSUANCE.] If after considering the information 
received at the hearing or hearings and considering the comments 
requested under subdivision 3, the commission determines that 
the license will not adversely affect the public health, 
welfare, and safety and that the racing to be licensed will be 
conducted in accordance with all applicable laws and rules, it 
may issue a class D license to the applicant.  The license is 
for a period of one year.  
    Subd. 5.  [RENEWAL.] On making the same determination as in 
subdivision 4, the commission may renew a class D license 
without a hearing unless it determines a hearing is necessary.  
    Subd. 6.  [REVOCATION AND SUSPENSION.] Revocation and 
suspension of class D licenses, and refusals to renew class D 
licenses, are as provided in section 6, subdivision 7.  A 
license suspension or revocation or a refusal to renew a class D 
license is a contested case under sections 14.57 to 14.70 of the 
Administrative Procedure Act and is in addition to criminal 
penalties imposed for a violation of law or rule.  
    Sec. 10.  [240.10] [LICENSE FEES.] 
    The fee for a class A license is $10,000 per year.  The fee 
for a class B license is $100 for each assigned racing day on 
which racing is actually conducted.  The fee for a class D 
license is $50 for each assigned racing day on which racing is 
actually conducted.  Fees imposed on class B and class D 
licenses must be paid to the commission at a time and in a 
manner as provided by rule of the commission.  
    The commission shall by rule establish an annual license 
fee for each occupation it licenses under section 8 but no 
annual fee for a class C license may exceed $100.  
    License fee payments received must be paid by the 
commission to the state treasurer for deposit in the general 
fund. 
    Sec. 11.  [240.11] [LICENSES NONTRANSFERABLE.] 
    A license issued under this act may not be transferred.  
    Sec. 12.  [240.12] [LICENSE AGREEMENTS.] 
    The commission may enter into agreements with comparable 
bodies in other racing jurisdictions for the mutual recognition 
of occupational licenses issued by each body.  The commission 
may by rule provide for and may charge a fee for the 
registration of each license issued in another jurisdiction.  
    Sec. 13.  [240.13] [PARI-MUTUEL BETTING.] 
    Subdivision 1.  [AUTHORIZED.] Class B and class D licenses 
give the licensees authority to conduct pari-mutuel betting on 
the results of races run at the licensed racetrack, and on other 
races as authorized by the commission under subdivision 6.  
    Subd. 2.  [REQUIREMENTS.] A licensee conducting pari-mutuel 
betting must provide at the licensed track:  
    (a) the necessary equipment for issuing pari-mutuel tickets;
and 
    (b) mechanical or electronic equipment for displaying 
information the commission requires.  All mechanical or 
electronic devices must be approved by the commission before 
being used.  
    Subd. 3.  [TYPES OF BETTING.] The commission shall by rule 
designate those types of pari-mutuel pools which are permitted 
at licensed racetracks, and no licensee may conduct any type of 
pari-mutuel pool which has not been so designated.  
    Subd. 4.  [TAKEOUT; DISTRIBUTION OF WINNINGS.] A licensee 
conducting pari-mutuel betting must deduct from a straight 
pari-mutuel pool, before payments to holders of winning tickets, 
an amount equal to 17 percent of the total money in that pool. 
The licensee must deduct from a multiple pari-mutuel pool, 
before payments to the holders of winning tickets, an amount 
equal to 23 percent of the total money in that pool.  The 
remaining money in each pool must be distributed among the 
holders of winning tickets in a manner the commission by rule 
prescribes for each type of pool.  Breakage must be computed on 
the basis of payoffs rounded down to the next lowest increment 
of 20 cents, with a minimum payoff of $2.20 on a $2 ticket, 
except that the licensee may reduce the minimum payoff to $2.10 
on a $2 ticket if there is not a sufficient amount in a pool to 
make a minimum payoff of $2.20.  
    Subd. 5.  [PURSES.] From the amounts deducted from all 
pari-mutuel pools by a licensee, an amount equal to five percent 
of all money in all pools must be set aside by the licensee and 
used for purses for races conducted by him.  The commission may 
by rule provide for the administration and enforcement of this 
subdivision.  
    Subd. 6.  [TELEVISED RACES.] The commission may by rule 
permit a class B or class D licensee to conduct on the premises 
of the licensed racetrack pari-mutuel betting on horse races run 
in other states and broadcast by television on the premises. All 
provisions of law governing pari-mutuel betting apply to 
pari-mutuel betting on televised races except as otherwise 
provided in this subdivision or in the commission's rules. 
Pari-mutuel pools conducted on such televised races may consist 
only of money bet on the premises and may not be commingled with 
any other pool off the premises, except that:  
    (a) the licensee may pay a fee to the person or entity 
conducting the race for the privileges of conducting pari-mutuel 
betting on the race, and 
    (b) the licensee may pay the costs of transmitting the 
broadcast of the race.  
    Pari-mutuel betting on a televised race may be conducted 
only on a racing day assigned by the commission.  The takeout 
and taxes on pari-mutuel pools on televised races are as 
provided for other pari-mutuel pools.  All televised races under 
this subdivision must comply with the Interstate Horse Racing 
Act of 1978 as found in United States Code, title 15, section 
3001 and the following relevent sections.  
    Subd. 7.  [TIME LIMIT FOR PAYMENTS.] The licensee must pay 
off on an uncashed ticket presented for payment within 90 days 
of the end of the racing meeting during which it was issued.  A 
ticket not presented for payment within that period is an 
unredeemed ticket and shall be reported to the commission as 
provided in section 15, subdivision 5.  
    Subd. 8.  [PROHIBITED ACTS.] A licensee may not accept a 
bet from any person under the age of 18 years; and a licensee 
may not accept a bet of less than $2.  
    Sec. 14.  [240.14] [RACING DAYS.] 
    Subdivision 1.  [ASSIGNMENT OF RACING DAYS.] The commission 
shall assign racing days to each racetrack licensee authorized 
to conduct racing with pari-mutuel betting, and a licensee may 
conduct racing with pari-mutuel betting only on a racing day 
assigned by the commission.  The commission may assign racing 
days for up to three years beyond the year in which the 
assignment is made.  Assignments of racing days in any year must 
be made by July 1 of the previous year, except that days may be 
assigned after that date to a licensee whose license is issued 
after that date.  
    Subd. 2.  [HEARING.] A public hearing is required before 
the commission may:  
    (a) make an assignment of racing days;  
    (b) revise the assignment during the year; or 
    (c) assign racing days to a licensee whose license is 
issued after the initial assignment.  
    The commission may without a hearing assign one additional 
racing day to a licensee for each originally assigned racing day 
during the same racing meeting on which racing was not conducted 
for reasons beyond the licensee's control.  
    Subd. 3.  [COUNTY FAIR RACING DAYS.] The commission may 
assign to a class D licensee only those racing days, not to 
exceed ten racing days, which coincide with the days on which 
the licensee's county fair is running or the weekend preceding 
or following the county fair.  
    Subd. 4.  [RESCINDING OF RACING DAYS.] The commission may, 
after a public hearing, rescind one or more racing days assigned 
to a licensee if it determines that the licensee has not met or 
will not meet the terms of his license.  A day or days so 
rescinded may be reassigned to another licensee.  
    Sec. 15.  [240.15] [PAYMENTS TO STATE.] 
    Subdivision 1.  [TAXES IMPOSED.] (a) There is imposed on 
the total amount bet on all pari-mutuel pools on each racing day 
a tax at the following rates:  
    (1) For each racing day in a calendar year on which the 
total amount bet, together with the total amount bet at the same 
licensed racetrack in all previous racing days in the same 
calendar year does not exceed $48,000,000, 1-3/4 percent of the 
total amount bet in all pari-mutuel pools.  
    (2) For each racing day in a calendar year after the racing 
day on which the total amount bet in all pari-mutuel pools at 
the same licensed racetrack in the same calendar year exceeds 
$48,000,000, six percent of the total amount bet in all 
pari-mutuel pools.  
    In addition to the above tax, the licensee must designate 
and pay to the commission a tax for deposit in the Minnesota 
breeders fund, at the following rates:  
    (1) For racing days on which the state tax under clause 
(a)(1) is 1-3/4 percent, one-half percent of the total amount 
bet in all pari-mutuel pools.  
    (2) For racing days on which the state tax under clause 
(a)(2) is six percent, one percent of the total amount bet in 
all pari-mutuel pools.  
    The taxes imposed by this clause must be paid from the 
amounts permitted to be withheld by a licensee under section 13, 
subdivision 4.  
    (b) The commission shall impose on each paid admission to 
each licensed racetrack on a racing day a tax of 40 cents.  It 
may impose an additional admissions tax of not more than ten 
cents at any licensed racetrack if:  
    (1) the additional tax is requested by a local unit of 
government within whose borders the track is located;  
    (2) a public hearing is held on the request; and 
    (3) the commission finds that the local unit of government 
requesting the additional tax is in need of its revenue to meet 
extraordinary expenses caused by the racetrack.  
    Subd. 2.  [PAYMENT.] The licensee must remit the tax to the 
commission or its representative within seven days of the day on 
which it was collected.  In addition to the tax and at that time 
the licensee must pay to the commission or its representative a 
sum equal to one-half the total breakage for each racing day 
during the period for which the tax is paid.  The payments must 
be accompanied by a detailed statement of the remittance on a 
form the commission prescribes.  The commission may by rule 
provide for the direct deposit of required payments in the 
commission's account in a financial institution within the state 
and for determining the time of applicability of different tax 
rates under subdivision 1.  
    Subd. 3.  [TAX EXCLUSIVE.] The tax imposed by subdivision 1 
is in lieu of any tax or license fee, other than taxes on real 
property, imposed by a political subdivision and in lieu of any 
other sales or excise tax imposed by the state on racetrack 
admissions or pari-mutuel pools or pari-mutuel ticket sales.  
    Subd. 4.  [REPORTS.] Within 100 days of the end of a racing 
meeting a licensee subject to the tax imposed by subdivision 1 
must file with the commission a certified statement of receipts 
from all sources during the racing meeting and of expenses and 
disbursements, itemized on a form the commission prescribes 
after consultation with the state auditor, showing the 
licensee's net revenues from all sources.  The statement must be 
prepared by a certified public accountant in accordance with 
generally accepted auditing standards.  
    Subd. 5.  [UNREDEEMED TICKETS.] Not later than 100 days 
after the end of a racing meeting a licensee who sells 
pari-mutuel tickets must remit to the commission or its 
representative an amount equal to the total value of unredeemed 
tickets from the racing meeting.  The remittance must be 
accompanied by a detailed statement of the money on a form the 
commission prescribes.  
    Subd. 6.  [DISPOSITION OF PROCEEDS.] The commission shall 
distribute all money received under this section, and all money 
received from license fees and fines it collects, as follows: 
all money designated for deposit in the Minnesota breeders fund 
must be paid into that fund for distribution under section 18. 
Revenue from an additional admissions tax imposed under 
subdivision 1 must be paid to the local unit of government at 
whose request it was imposed, at times and in a manner the 
commission determines.  All other revenues received under this 
section by the commission, and all license fees, fines, and 
other revenue it receives, must be paid to the state treasurer 
for deposit in the general fund.  
    Sec. 16.  [240.16] [STEWARDS.] 
    Subdivision 1.  [POWERS AND DUTIES.] All horse races run at 
a licensed racetrack must be presided over by a board of three 
stewards, who must be appointees of the commission or persons 
approved by it.  The commission shall designate one steward as 
chairman.  At least two stewards for all races shall be 
employees of the commission and they shall serve in the 
unclassified service.  The commission may delegate the following 
duties and powers to a board of stewards:  
    (a) to ensure that races are run in accordance with the 
commission's rules;  
    (b) to supervise the conduct of racing to ensure the 
integrity of the sport;  
    (c) to settle disputes arising from the running of horse 
races, and to certify official results;  
    (d) to impose on licensees, for violation of law or 
commission rules, fines not exceeding $500 and license 
suspensions not exceeding 30 days;  
    (e) to recommend to the commission where warranted 
penalties in excess of those in clause (d);  
    (f) to otherwise enforce the laws and rules of racing; and 
    (g) to perform other duties and have other powers assigned 
by the commission.  
    Subd. 2.  [APPEALS; HEARINGS.] A ruling of a board of 
stewards may be appealed to the commission or be reviewed by it 
on its own initiative.  The commission may provide for appeals 
to be heard by less than a quorum of the commission.  A hearing 
on a penalty imposed by a board of stewards must be granted on 
request.  
    Subd. 3.  [PROCEDURAL POWERS.] A board of stewards has the 
authority to administer oaths, issue subpoenas, order the 
production of documents and other evidence, and regulate the 
course of hearings before it, according to the commission's 
rules.  Hearings held by a board of stewards are not subject to 
the provisions of the Administrative Procedure Act except those 
provisions which the commission by rule makes applicable.  
    Subd. 4.  [RULES.] In addition to rules under subdivision 
3, the commission may promulgate rules governing the 
qualifications, appointment, approval, authority, removal, and 
compensation of stewards.  
    Subd. 5.  [COSTS.] The commission may require that a 
licensee reimburse it for the costs of providing a state-paid 
steward or stewards to supervise racing at the licensee's 
racetrack.  
    Subd. 6 [COMPENSATION.] The total compensation of stewards 
who are not employees of the division must be commensurate with 
the compensation of stewards who are division employees 
    Sec. 17.  [240.17] [LOCAL OPTION.] 
    Subdivision 1.  [CITIES.] An issuance of a class A license 
for a location in a city is not effective until it has been 
approved by a majority vote of the city council.  Failure to act 
on a license within 30 days of its referral to a city council by 
the commission constitutes approval.  
    Subd. 2.  [TOWNS.] An issuance of a class A license for a 
location in a town is not effective until it has been approved 
by a majority vote of the town board.  Failure to act on a 
license within 30 days of its referral to the town board by the 
commission constitutes approval.  
    Subd. 3.  [UNORGANIZED TERRITORY.] An issuance of a class A 
license for a location in unorganized territory is not effective 
until it has been approved by a majority vote of the county 
board.  Failure to act on a license within 30 days of its 
referral to the county board by the commission constitutes 
approval.  
    Sec. 18.  [240.18] [BREEDERS FUND.] 
    The commission shall establish a Minnesota breeders fund 
with the money paid to it under section 15, subdivision 1.  The 
commission, after paying the costs of administering the fund, 
shall distribute the net proceeds as follows:  
    (1) Twenty percent of the remaining money in the fund must 
be expended as grants for equine research and related education 
at public institutions of post-secondary learning within the 
state.  
    (2) After deducting the amount for (1), the balance of the 
fund shall be apportioned into categories corresponding with the 
various breeds of horses which raced at licensed Minnesota 
racetracks in the previous year, in proportion to each 
category's contribution to the fund.  The funds in each category 
may be expended by the commission to:  
     (a) supplement purses for races held exclusively for 
Minnesota-bred, Minnesota-foaled or Minnesota-owned horses until 
January 1, 1986, and for Minnesota-bred and Minnesota-foaled 
horses after that date;  
    (b) pay breeders or owners awards to the breeders or owners 
of Minnesota-bred horses which win money at licensed racetracks 
in the state; and 
     (c) provide other financial incentives to encourage the 
horse breeding industry in Minnesota. 
     The commission shall adopt rules governing the distribution 
of the fund.  The commission may establish advisory committees 
to advise it on the distribution of money under this section, 
provided that the members of an advisory committee shall serve 
without compensation.  
    Sec. 19.  [240.19] [CONTRACTS.] 
    The commission shall by rule require that all contracts 
entered into by a class A, class B, or class D licensee for the 
provision of goods or services, including concessions contracts, 
be subject to commission approval.  The rules must require that 
the contract include an affirmative action plan establishing 
goals and timetables consistent with the Minnesota Human Rights 
Act, chapter 363.  The commission may require a contract holder 
to submit to it documents and records the commission deems 
necessary to evaluate the contract.  
    Sec. 20.  [240.20] [APPEALS.] 
    Appeals from a decision of the commission must be made in 
the manner prescribed by sections 14.63 to 14.68.  
    Sec. 21.  [240.21] [RIGHT OF INSPECTION.] 
    The commission and its representatives have the right to 
inspect the licensed premises of a licensee and to examine his 
books and other records at any time without a search warrant.  
    Sec. 22.  [240.22] [FINES.] 
    The commission shall by rule establish a graduated schedule 
of civil fines for violations of laws related to horse racing or 
of the commission's rules.  The schedule must include minimum 
and maximum fines for each violation and be based on and reflect 
the culpability, frequency and severity of the violator's 
actions.  The commission may impose a fine from this schedule on 
a licensee for a violation of those rules or laws relating to 
horse racing.  The fine is in addition to any criminal penalty 
imposed for the same violation.  Fines imposed by the commission 
must be paid to the commission and forwarded to the state 
treasurer for deposit in the general fund.  A fine is a 
contested case under the Administrative Procedure Act.  
    Sec. 23.  [240.23] [RULEMAKING AUTHORITY.] 
    The commission has the authority, in addition to all other 
rulemaking authority granted elsewhere in this act, to 
promulgate rules governing:  
    (a) the conduct of horse races held at licensed racetracks 
in Minnesota, including but not limited to the rules of racing, 
standards of entry, operation of claiming races, filing and 
handling of objections, carrying of weights, and declaration of 
official results;  
    (b) wire communications between the premises of a licensed 
racetrack and any place outside the premises;  
    (c) information on horse races which is sold on the 
premises of a licensed racetrack;  
    (d) liability insurance which it may require of all class 
A, class B, and class D licensees;  
    (e) the auditing of the books and records of a licensee by 
an auditor employed or appointed by the commission;  
    (f) emergency action plans maintained by licensed 
racetracks and their periodic review;  
    (g) safety, security, and sanitation of stabling facilities 
at licensed racetracks;  
    (h) entry fees and other funds received by a licensee in 
the course of conducting racing which the commission determines 
must be placed in escrow accounts; and 
    (i) any other aspect of horse racing or pari-mutuel betting 
which in its opinion affects the integrity of racing or the 
public health, welfare, or safety.  
    Rules of the commission are subject to chapter 14, the 
Administrative Procedure Act.  
    Sec. 24.  [240.24] [MEDICATION.] 
    The commission shall make and enforce rules governing 
medication and medical testing for horses running at licensed 
racetracks.  The rules must provide that no medication, as the 
commission defines that term by rule, may be administered to a 
horse within 48 hours of a race it runs at a licensed 
racetrack.  The commission shall by rule establish the 
qualifications for laboratories used by it as testing 
laboratories to enforce its rules under this section.  
    Sec. 25.  [240.25] [PROHIBITED ACTS.] 
    Subdivision 1.  [ILLEGAL BETS.] No person may place or 
accept a bet as defined in section 609.75 on the premises of a 
licensed racetrack other than a bet made within a licensed 
pari-mutuel system.  
    Subd. 2.  [OFF-TRACK BETS.] No person may, as part of an 
organized commercial activity, place or accept a bet off the 
premises of a licensed racetrack for delivery to a licensed 
racetrack.  
    Subd. 3.  [INFLUENCING RACES.] No person may influence or 
attempt to influence a horse race by:  
    (a) making threats;  
    (b) offering anything of value to a person involved in the 
conduct of a race in return for that person's committing an 
illegal act or failing to perform a duty; or 
    (c) conniving with or seeking or having an understanding or 
agreement with a person involved in the conduct of a race to 
commit an illegal act or to fail to perform a duty.  
    Subd. 4.  [TAMPERING WITH HORSES.] No person may:  
    (a) on the premises of a licensed racetrack use, have in 
his possession with intent to use, or knowingly assist another 
person in using a battery or buzzer, electrical or mechanical, 
or other device or appliance, which can be used to affect a 
horse's racing condition or performance, other than an ordinary 
whip;  
    (b) affect or attempt to affect the racing condition or 
performance of a horse at a race or workout through the use of a 
drug or medication in violation of the commission's rules; or 
    (c) use any method, injurious or otherwise, to affect a 
horse's racing condition or performance at a race or workout in 
violation of the commission's rules.  
    Subd. 5.  [REPORTING OF INFORMATION.] A person licensed by 
the commission who has information regarding a violation of any 
provision of this section must report that information promptly 
to the commission or an agent of the commission.  
    Subd. 6.  [FALSE STATEMENT.] No person may knowingly make a 
false statement in a document or application required to be 
submitted to the commission or in a sworn statement to or 
testimony before the commission.  
    Subd. 7.  [ALTERED TICKETS.] No person may knowingly offer 
for payment any pari-mutuel ticket which has been altered or any 
counterfeit or forged pari-mutuel ticket.  
    Sec. 26.  [240.26] [PENALTIES.] 
     Subdivision 1. [FELONIES.] A violation of the prohibition 
against accepting a bet in section 25, subdivisions 1 and 2, and 
a violation of section 25, subdivisions 3, 4, and 7 is a felony. 
    Subd. 2.  [GROSS MISDEMEANORS.] A violation of the 
prohibition against placing a bet in section 25, subdivisions 1 
and 2, and a violation of section 25, subdivisions 5 and 6, is a 
gross misdemeanor. 
    Subd. 3.  [MISDEMEANORS.] A violation of any other 
provision of this act or of a rule or order of the commission 
for which another penalty is not provided is a misdemeanor.  
    Sec. 27.  [240.27] [EXCLUSION OF CERTAIN PERSONS.] 
    Subdivision 1.  [PERSONS EXCLUDED.] The commission may 
exclude from any and all licensed racetracks in the state a 
person who:  
    (a) has been convicted of a felony under the laws of any 
state or the United States;  
    (b) has had a license suspended, revoked, or denied by the 
commission or by the racing authority of any other jurisdiction; 
or 
    (c) is determined by the commission, on the basis of 
evidence presented to it, to be a threat to the integrity of 
racing in Minnesota.  
    Subd. 2.  [HEARING; APPEAL.] An order to exclude a person 
from any or all licensed racetracks in the state must be made by 
the commission at a public hearing of which the person to be 
excluded must have at least five days' notice.  If the person is 
present at the hearing, he must be permitted to show cause why 
he should not be excluded.  An appeal of the order may be made 
in the same manner as other appeals under section 20.  
    Subd. 3.  [NOTICE TO RACETRACKS.] Upon issuing an order 
excluding a person from any or all licensed racetracks, the 
commission shall send a copy of the order to the excluded person 
and to all racetracks named in it, along with other information 
as it deems necessary to permit compliance with the order.  
    Subd. 4.  [PROHIBITIONS.] It is a gross misdemeanor for a 
person named in an exclusion order to enter, attempt to enter, 
or be on the premises of a racetrack named in the order while it 
is in effect, and for a person licensed to conduct racing or 
operate a racetrack knowingly to permit an excluded person to 
enter or be on the premises.  
    Subd. 5.  [EXCLUSIONS BY RACETRACK.] The holder of a 
license to conduct racing may eject and exclude from its 
premises any licensee or any other person who is in violation of 
any state law or commission rule or order or who is a threat to 
racing integrity or the public safety.  A person so excluded 
from racetrack premises may appeal his exclusion to the 
commission and must be given a public hearing on his appeal if 
he so requests.  At the hearing he must be given the opportunity 
to show cause why he should not be so excluded.  If the 
commission after the hearing finds that the integrity of racing 
and the public safety do not justify the exclusion, it shall 
order the racetrack making the exclusion to reinstate or readmit 
the person.  An appeal of a commission order upholding the 
exclusion is governed by section 20. 
    Sec. 28.  [240.28] [CONFLICT OF INTEREST.] 
    Subdivision 1.  [FINANCIAL INTEREST.] No person may serve 
on the commission or be employed by it who has an interest in 
any corporation, association, or partnership which holds a 
license from the commission or which holds a contract to supply 
goods or services to a licensee or at a licensed racetrack, 
including concessions contracts.  No member or employee of the 
commission may own, wholly or in part, or have an interest in a 
horse which races at a licensed racetrack in Minnesota.  No 
member or employee of the commission may have a financial 
interest in or be employed in a profession or business which 
conflicts with the performance of his duties as a member or 
employee.  
    Subd. 2.  [BETTING.] No member or employee of the 
commission may bet or cause a bet to be made on a race at a 
licensed racetrack while serving on or being employed by the 
commission.  No person appointed or approved by the commission 
as a steward may bet or cause a bet to be made at a licensed 
racetrack during a racing meeting at which he is serving as a 
steward.  The commission shall by rule prescribe such 
restrictions on betting by its licensees as it deems necessary 
to protect the integrity of racing.  
    Subd. 3.  [VIOLATION.] A violation of subdivisions 1 and 2 
is grounds for removal from the commission or termination of 
employment.  A bet made directly or indirectly by a licensee in 
violation of a rule made by the commission under subdivision 2 
is grounds for suspension or revocation of the license.  
    Sec. 29.  [240.29] [REQUIRED RACES.] 
     Each holder of a class B or D license must declare and 
schedule, on each racing day it conducts, at least one race 
which; 
     (a) before January 1, 1986, is limited to horses which are 
Minnesota-bred, Minnesota-foaled or Minnesota-owned, and 
     (b) on and after January 1, 1986, is limited to horses 
which are Minnesota-bred or Minnesota-foaled. 
     If there is not a sufficient number of such horses entered 
in the declared race to make up an adequate slate of entries, 
another race may be substituted. 
    The commission shall by rule define "Minnesota-bred," 
"Minnesota-foaled" and "Minnesota-owned."  
     Sec. 30.  Minnesota Statutes 1982, section 10A.09, 
subdivision 1, is amended to read: 
    Subdivision 1.  [TIME FOR FILING.] Except for a candidate 
for elective office in the judicial branch, an individual shall 
file a statement of economic interest with the board: 
    (a) Within 60 days of accepting employment as a public 
official; or 
    (b) Within 14 days after filing an affidavit of candidacy 
or petition to appear on the ballot for an elective public 
office; or 
    (c) In the case of a public official requiring the advice 
and consent of the senate, prior to the submission of his name 
to the senate, and in any event, within 60 days after he 
undertakes the duties of his office; or 
    (d) In the case of members of the Minnesota racing 
commission, and its executive secretary, chief of security, 
medical officer, inspector of pari-mutuels and stewards employed 
or approved by the commission or persons who fulfill those 
duties under contract, within 60 days of accepting or assuming 
duties.  
     Sec. 31.  Minnesota Statutes 1982, section 10A.09, 
subdivision 5, is amended to read: 
    Subd. 5.  [FORM.] A statement of economic interest required 
by this section shall be on a form prescribed by the board.  The 
individual filing shall provide the following information: 
    (a) His name, address, occupation and principal place of 
business; 
    (b) The name of each business with which he is associated 
and the nature of that association; 
    (c) A listing of all real property within the state, 
excluding homestead property, in which he holds:  (i) a fee 
simple interest, a mortgage, a contract for deed as buyer or 
seller, or an option to buy, whether direct or indirect, and 
which interest is valued in excess of $2,500; or (ii) an option 
to buy, which property has a fair market value of $50,000 or 
more; and 
    (d) A listing of all real property within the state in 
which a partnership of which he is a member holds:  (i) a fee 
simple interest, a mortgage, a contract for deed as buyer or 
seller, or an option to buy, whether direct or indirect, if his 
share of the partnership interest is valued in excess of $2,500 
or (ii) an option to buy, which property has a fair market value 
of $50,000 or more.  Any listing under clause (c) or (d) shall 
indicate the street address and the municipality or the section, 
township, range and approximate acreage, whichever applies, and 
the county wherein the property is located; and 
    (e) A listing of any investments, ownership, or interests 
in property connected with pari-mutuel horse racing in the 
United States and Canada, including a race horse, in which he 
directly or indirectly holds a partial or full interest or an 
immediate family member holds a partial or full interest. 
     Sec. 32.  Minnesota Statutes 1982, section 38.04, is 
amended to read: 
    38.04 [ANNUAL MEETINGS; REPORTS.] 
    Every county agricultural society shall hold an annual 
meeting for the election of officers and the transaction of 
other business on or before the third Tuesday in November, each 
year, at which time its secretary shall make a report of its 
proceedings for the preceding year; this report shall contain a 
statement of all transactions at its fairs, the numbers of 
entries, the amount and source of all moneys received, and the 
amount paid out for premiums and other purposes, and show in 
detail its entire receipts and expenditures during the year.  
The report must contain a separate accounting of any income 
received from the operation of horse racing on which pari-mutuel 
betting is conducted, and of the disposition of that income.  
    The treasurer shall make a comprehensive report of the 
funds received, paid out, and on hand, and upon whose order 
paid.  Each secretary shall cause a certified copy of his annual 
report to be filed with the county recorder of the county and 
the commissioner of agriculture on or before the first day of 
November, each year. 
    Sec. 33.  Minnesota Statutes 1982, section 340.11, is 
amended by adding a subdivision to read: 
    Subd. 22.  [LICENSES AT RACETRACKS.] An on-sale 
intoxicating liquor license issued by a municipality to a 
location at a racetrack licensed under chapter 240 may not be 
transferred and is in addition to the number of on-sale 
intoxicating liquor licenses authorized by subdivision 5a.  
    Sec. 34.  Minnesota Statutes 1982, section 609.75, 
subdivision 1, is amended to read:  
    Subdivision 1.  [LOTTERY.] (a) A lottery is a plan which 
provides for the distribution of money, property or other reward 
or benefit to persons selected by chance from among participants 
some or all of whom have given a consideration for the chance of 
being selected.  
    (b) An in-package chance promotion is not a lottery if all 
of the following are met:  
    (1) participation is available, free and without purchase 
of the package, from the retailer or by mail or toll-free 
telephone request to the sponsor for entry or for a game piece;  
    (2) the label of the promotional package and any related 
advertising clearly states any method of participation and the 
scheduled termination date of the promotion;  
    (3) the sponsor on request provides a retailer with a 
supply of entry forms or game pieces adequate to permit free 
participation in the promotion by the retailer's customers;  
    (4) the sponsor does not misrepresent a participant's 
chances of winning any prize;  
    (5) the sponsor randomly distributes all game pieces and 
maintains records of random distribution for at least one year 
after the termination date of the promotion;  
    (6) all prizes are randomly awarded if game pieces are not 
used in the promotion; and 
    (7) the sponsor provides on request of a state agency a 
record of the names and addresses of all winners of prizes 
valued at $100 or more, if the request is made within one year 
after the termination date of the promotion.  
    (c) Except as provided by section 349.40, acts in this 
state in furtherance of a lottery conducted outside of this 
state are included notwithstanding its validity where conducted. 
    Sec. 35.  Minnesota Statutes 1982, 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 a gambling device or the conduct of a 
raffle as defined in section 349.26, by an organization licensed 
for such operation by a local unit of government pursuant to 
section 349.26.  
     (7) Pari-mutuel betting on horse racing when conducted 
under chapter 240.  
    Sec. 36.  Minnesota Statutes 1982, section 609.75, is 
amended by adding a subdivision to read: 
    Subd. 7.  [SPORTS BOOKMAKING.] Sports bookmaking is the 
activity of intentionally receiving, recording or forwarding in 
any one day more than five bets or offers to bet totaling more 
than $1,500 on the outcome of an organized sporting event.  
    Sec. 37.  Minnesota Statutes 1982, section 609.76, is 
amended to read: 
    609.76 [OTHER ACTS RELATING TO GAMBLING.] 
    Subdivision 1.  [GROSS MISDEMEANORS.] Whoever does any of 
the following may be sentenced to imprisonment for not more than 
one year or to payment of a fine of not more than $1,000, or 
both: 
    (1) Maintains or operates a gambling place or operates a 
bucket shop; or 
    (2) Intentionally participates in the income of a gambling 
place or bucket shop; or 
    (3) Conducts a lottery, or, with intent to conduct a 
lottery, possesses facilities for doing so; or 
    (4) Sets up for use for the purpose of gambling, or 
collects the proceeds of, any gambling device or bucket shop; or 
    (5) With intent that it shall be so used, manufactures, 
sells or offers for sale, in whole or any part thereof, any 
gambling device including those defined in section 349.30, 
subdivision 2, and any facility for conducting a lottery, except 
as provided by section 349.40; or 
    (6) Receives, records, or forwards bets or offers to bet 
or, with intent to receive, record, or forward bets or offers to 
bet, possesses facilities to do so. 
    Subd. 2.  [FELONY GAMBLING.] Whoever engages in sports 
bookmaking is guilty of a felony.  
    Sec. 38.  Minnesota Statutes 1982, section 609.761, is 
amended to read: 
    Notwithstanding sections 609.755 and 609.76, a fraternal, 
religious, veterans or other nonprofit organization may set up 
or operate a gambling device or conduct a raffle as defined in 
section 349.26, if licensed by the local unit of government and 
conducted pursuant to under section 349.26, and a person may 
manufacture, sell or offer for sale a gambling device to the 
organization, and pari-mutuel betting on horse racing may be 
conducted under chapter 240.  
    Sec. 39.  [609.762] [FORFEITURE OF GAMBLING DEVICES, PRIZES 
AND PROCEEDS.] 
    Subdivision 1.  [FORFEITURE.] The following are subject to 
forfeiture:  
    (a) Devices used or intended for use, including those 
defined in section 349.30, subdivision 2, as a gambling device, 
except as authorized in section 349.11 to 349.23 and 349.40;  
    (b) All moneys, materials, and other property used or 
intended for use as payment to participate in gambling or a 
prize or receipt for gambling;  
    (c) Books, records, and research products and materials, 
including formulas, microfilm, tapes, and data used or intended 
for use in gambling; and 
    (d) Property used or intended to be used to illegally 
influence the outcome of a horse race.  
    Subd. 2.  [SEIZURE.] Property subject to forfeiture under 
subdivision 1 may be seized by any law enforcement agency upon 
process issued by any court having jurisdiction over the 
property.  Seizure without process may be made if:  
    (a) the seizure is incident to an arrest or a search under 
a search warrant;  
    (b) the property subject to seizure has been the subject of 
a prior judgment in favor of the state in a criminal injunction 
or forfeiture proceeding; or 
    (c) the law enforcement agency has probable cause to 
believe that the property was used or is intended to be used in 
a gambling violation and the delay occasioned by the necessity 
to obtain process would result in the removal, loss, or 
destruction of the property.  
    Subd. 3.  [NOT SUBJECT TO REPLEVIN.] Property taken or 
detained under subdivision 2 is not subject to a replevin 
action, but is considered to be in the custody of the law 
enforcement agency subject only to the orders and decrees of the 
court having jurisdiction over the forfeiture proceedings.  
    Subd. 4.  [PROCEDURES.] Property must be forfeited after a 
conviction for a gambling violation according to the following 
procedure:  
    (a) a separate complaint must be filed against the property 
describing it, charging its use in the specified violation, and 
specifying the time and place of its unlawful use;  
    (b) if the person charged with a gambling offense is 
acquitted, the court shall dismiss the complaint and order the 
property returned to the persons legally entitled to it; and 
    (c) if after conviction the court finds the property, or 
any part of it, was used in violation as specified in the 
complaint, it shall order that the property be sold or retained 
by the law enforcement agency for official use.  Proceeds from 
the sale of forfeited property may be retained for official use 
and shared equally between the law enforcement agency 
investigating the offense involved in the forfeiture and the 
prosecuting agency that prosecuted the offense involved in the 
forfeiture and handled the forfeiture proceedings.  
     Subd. 5. [EXCEPTION.] Property may not be seized or 
forfeited under this section if the owner shows to the 
satisfaction of the court that he had no notice or knowledge or 
reason to believe that the property was used or intended to be 
used in violation of this section 
    Sec. 40.  [APPROPRIATION.] 
    Subdivision 1.  There is appropriated from the general fund 
to the Minnesota racing commission, for the purposes of sections 
1 to 29, the sum of $247,000 for the year ending June 30, 1984, 
and $344,300 for the year ending June 30, 1985.  Notwithstanding 
the provisions of section 16A.28, the appropriation is available 
until expended.  
     Subd. 2.  There is appropriated from the general fund to 
the Minnesota racing commission the sum of $150,000 to carry out 
the purposes of this act, to be available only with the approval 
of the governor after consultation with the legislative advisory 
commission pursuant to Minnesota Statutes, section 3.30.  This 
appropriation is available for the year ending June 30, 1985.  
    Sec. 41.  [EFFECTIVE DATE.] 
    This act is effective the day following final enactment. 
    Approved May 23, 1983