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Minnesota Legislature

Office of the Revisor of Statutes

Key: (1) language to be deleted (2) new language

                            CHAPTER 110-H.F.No. 1244 
                  An act relating to lawful gambling; making various 
                  clarifying and technical changes; providing and 
                  modifying definitions; providing for conduct of linked 
                  bingo games; permitting resale of certain gambling 
                  equipment; providing for fees, prices, and prize 
                  limits; clarifying requirements for gambling managers 
                  and employees, premises, records and reports; 
                  clarifying conduct of high school raffles; amending 
                  Minnesota Statutes 2002, sections 349.12, subdivisions 
                  4, 18, 19, 25, by adding subdivisions; 349.151, 
                  subdivisions 4, 4b; 349.153; 349.155, subdivision 3; 
                  349.161, subdivision 5; 349.163, subdivision 3; 
                  349.166, subdivisions 1, 2; 349.167, subdivisions 4, 
                  6, 7; 349.168, subdivisions 1, 2, 6, by adding a 
                  subdivision; 349.169, subdivisions 1, 3; 349.17, 
                  subdivisions 3, 6, 7, by adding a subdivision; 349.18, 
                  subdivision 1; 349.19, subdivision 3, by adding a 
                  subdivision; 349.191, subdivisions 1, 1a; 349.211, 
                  subdivision 1, by adding a subdivision; 609.761, 
                  subdivision 5; proposing coding for new law in 
                  Minnesota Statutes, chapter 349; repealing Minnesota 
                  Statutes 2002, section 349.168, subdivision 9. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 3b.  [BAR OPERATION.] "Bar operation" means a method 
        of selling and redeeming gambling equipment within a leased 
        premises which is licensed for the on-sale of alcoholic 
        beverages where such sales and redemptions are made by an 
        employee of the lessor from a common area where food and 
        beverages are also sold. 
           Sec. 2.  Minnesota Statutes 2002, section 349.12, 
        subdivision 4, is amended to read: 
           Subd. 4.  [BINGO.] "Bingo" means a game where each player 
        has a bingo hard card or bingo paper sheet, for which a 
        consideration has been paid, and played in accordance with this 
        chapter and with rules of the board for the conduct of 
        bingo.  "Bingo" also includes a linked bingo game. 
           Sec. 3.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 6a.  [BOOTH OPERATION.] "Booth operation" means a 
        method of selling and redeeming gambling equipment by an 
        employee of a licensed organization in a premises the 
        organization leases or owns where such sales and redemptions are 
        made within a separate enclosure that is distinct from areas 
        where food and beverages are sold. 
           Sec. 4.  Minnesota Statutes 2002, section 349.12, 
        subdivision 18, is amended to read: 
           Subd. 18.  [GAMBLING EQUIPMENT.] "Gambling equipment" 
        means:  bingo hard cards or paper sheets, linked bingo paper 
        sheets, devices for selecting bingo numbers, pull-tabs, jar 
        tickets, paddlewheels, paddlewheel tables, paddletickets, 
        paddleticket cards, tipboards, tipboard tickets, and pull-tab 
        dispensing devices. 
           Sec. 5.  Minnesota Statutes 2002, section 349.12, 
        subdivision 19, is amended to read: 
           Subd. 19.  [GAMBLING MANAGER.] "Gambling manager" means a 
        person who has been designated by the organization to supervise 
        the lawful gambling conducted by it and who: 
           (1) has been an active member of the organization for at 
        least two years at the time of the organization's initial 
        application for a license; or 
           (2) has been an active member of the organization for at 
        least the most recent six months prior to the effective date of 
        the organization's renewal license; or 
           (3) meets other qualifications as prescribed by the board 
        by rule. 
           Sec. 6.  Minnesota Statutes 2002, section 349.12, 
        subdivision 25, is amended to read: 
           Subd. 25.  [LAWFUL PURPOSE.] (a) "Lawful purpose" means one 
        or more of the following:  
           (1) any expenditure by or contribution to a 501(c)(3) or 
        festival organization, as defined in subdivision 15a, provided 
        that the organization and expenditure or contribution are in 
        conformity with standards prescribed by the board under section 
        349.154, which standards must apply to both types of 
        organizations in the same manner and to the same extent; 
           (2) a contribution to an individual or family suffering 
        from poverty, homelessness, or physical or mental disability, 
        which is used to relieve the effects of that poverty, 
        homelessness, or disability; 
           (3) a contribution to an individual for treatment for 
        delayed posttraumatic stress syndrome or a contribution to a 
        program recognized by the Minnesota department of human services 
        for the education, prevention, or treatment of compulsive 
        gambling; 
           (4) a contribution to or expenditure on a public or private 
        nonprofit educational institution registered with or accredited 
        by this state or any other state; 
           (5) a contribution to a scholarship fund for defraying the 
        cost of education to individuals where the funds are awarded 
        through an open and fair selection process; 
           (6) activities by an organization or a government entity 
        which recognize humanitarian or military service to the United 
        States, the state of Minnesota, or a community, subject to rules 
        of the board, provided that the rules must not include mileage 
        reimbursements in the computation of the per occasion diem 
        reimbursement limit and must impose no aggregate annual limit on 
        the amount of reasonable and necessary expenditures made to 
        support: 
           (i) members of a military marching or color guard unit for 
        activities conducted within the state; 
           (ii) members of an organization solely for services 
        performed by the members at funeral services; or 
           (iii) members of military marching, color guard, or honor 
        guard units may be reimbursed for participating in color guard, 
        honor guard, or marching unit events within the state or states 
        contiguous to Minnesota at a per participant rate of up to $35 
        per occasion diem; 
           (7) recreational, community, and athletic facilities and 
        activities intended primarily for persons under age 21, provided 
        that such facilities and activities do not discriminate on the 
        basis of gender and the organization complies with section 
        349.154; 
           (8) payment of local taxes authorized under this chapter, 
        taxes imposed by the United States on receipts from lawful 
        gambling, the taxes imposed by section 297E.02, subdivisions 1, 
        4, 5, and 6, and the tax imposed on unrelated business income by 
        section 290.05, subdivision 3; 
           (9) payment of real estate taxes and assessments on 
        permitted gambling premises wholly owned by the licensed 
        organization paying the taxes, or wholly leased by a licensed 
        veterans organization under a national charter recognized under 
        section 501(c)(19) of the Internal Revenue Code, not to exceed: 
           (i) for premises used for bingo, the amount that an 
        organization may expend under board rules on rent for bingo; and 
           (ii) $35,000 per year for premises used for other forms of 
        lawful gambling; 
           (10) a contribution to the United States, this state or any 
        of its political subdivisions, or any agency or instrumentality 
        thereof other than a direct contribution to a law enforcement or 
        prosecutorial agency; 
           (11) a contribution to or expenditure by a nonprofit 
        organization which is a church or body of communicants gathered 
        in common membership for mutual support and edification in 
        piety, worship, or religious observances; 
           (12) payment of the reasonable costs of an audit required 
        in section 297E.06, subdivision 4, provided the annual audit is 
        filed in a timely manner with the department of revenue; 
           (13) a contribution to or expenditure on a wildlife 
        management project that benefits the public at-large, provided 
        that the state agency with authority over that wildlife 
        management project approves the project before the contribution 
        or expenditure is made; 
           (14) expenditures, approved by the commissioner of natural 
        resources, by an organization for grooming and maintaining 
        snowmobile trails and all-terrain vehicle trails that are (1) 
        grant-in-aid trails established under section 85.019, or (2) 
        other trails open to public use, including purchase or lease of 
        equipment for this purpose; or 
           (15) conducting nutritional programs, food shelves, and 
        congregate dining programs primarily for persons who are age 62 
        or older or disabled; 
           (16) a contribution to a community arts organization, or an 
        expenditure to sponsor arts programs in the community, including 
        but not limited to visual, literary, performing, or musical 
        arts; 
           (17) an expenditure by a licensed veterans organization for 
        payment of heat, water, sanitation, telephone, and other utility 
        bills fuel for heating, electricity, and sewer costs for a 
        building wholly owned or wholly leased by, and used as the 
        primary headquarters of, a the licensed veterans organization; 
        or 
           (18) expenditure by a licensed veterans organization of up 
        to $5,000 in a calendar year in net costs to the organization 
        for meals and other membership events, limited to members and 
        spouses, held in recognition of military service.  No more than 
        $5,000 can be expended in total per calendar year under this 
        clause by all licensed veterans organizations sharing the same 
        veterans post home. 
           (b) Notwithstanding paragraph (a), "lawful purpose" does 
        not include: 
           (1) any expenditure made or incurred for the purpose of 
        influencing the nomination or election of a candidate for public 
        office or for the purpose of promoting or defeating a ballot 
        question; 
           (2) any activity intended to influence an election or a 
        governmental decision-making process; 
           (3) the erection, acquisition, improvement, expansion, 
        repair, or maintenance of real property or capital assets owned 
        or leased by an organization, unless the board has first 
        specifically authorized the expenditures after finding that (i) 
        the real property or capital assets will be used exclusively for 
        one or more of the purposes in paragraph (a); (ii) with respect 
        to expenditures for repair or maintenance only, that the 
        property is or will be used extensively as a meeting place or 
        event location by other nonprofit organizations or community or 
        service groups and that no rental fee is charged for the use; 
        (iii) with respect to expenditures, including a mortgage payment 
        or other debt service payment, for erection or acquisition only, 
        that the erection or acquisition is necessary to replace with a 
        comparable building, a building owned by the organization and 
        destroyed or made uninhabitable by fire or natural disaster, 
        provided that the expenditure may be only for that part of the 
        replacement cost not reimbursed by insurance; (iv) with respect 
        to expenditures, including a mortgage payment or other debt 
        service payment, for erection or acquisition only, that the 
        erection or acquisition is necessary to replace with a 
        comparable building a building owned by the organization that 
        was acquired from the organization by eminent domain or sold by 
        the organization to a purchaser that the organization reasonably 
        believed would otherwise have acquired the building by eminent 
        domain, provided that the expenditure may be only for that part 
        of the replacement cost that exceeds the compensation received 
        by the organization for the building being replaced; or (v) with 
        respect to an expenditure to bring an existing building into 
        compliance with the Americans with Disabilities Act under item 
        (ii), an organization has the option to apply the amount of the 
        board-approved expenditure to the erection or acquisition of a 
        replacement building that is in compliance with the Americans 
        with Disabilities Act; 
           (4) an expenditure by an organization which is a 
        contribution to a parent organization, foundation, or affiliate 
        of the contributing organization, if the parent organization, 
        foundation, or affiliate has provided to the contributing 
        organization within one year of the contribution any money, 
        grants, property, or other thing of value; 
           (5) a contribution by a licensed organization to another 
        licensed organization unless the board has specifically 
        authorized the contribution.  The board must authorize such a 
        contribution when requested to do so by the contributing 
        organization unless it makes an affirmative finding that the 
        contribution will not be used by the recipient organization for 
        one or more of the purposes in paragraph (a); or 
           (6) a contribution to a statutory or home rule charter 
        city, county, or town by a licensed organization with the 
        knowledge that the governmental unit intends to use the 
        contribution for a pension or retirement fund. 
           Sec. 7.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 25a.  [LINKED BINGO GAME.] "Linked bingo game" means 
        a bingo game played at two or more locations where licensed 
        organizations are authorized to conduct bingo, where there is a 
        common prize pool and a common selection of numbers or symbols 
        conducted at one location, and where the results of the 
        selection are transmitted to all participating locations by 
        satellite, telephone, or other means by a linked bingo game 
        provider. 
           Sec. 8.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 25b.  [LINKED BINGO GAME PROVIDER.] "Linked bingo 
        game provider" means any person who provides the means to link 
        bingo prizes in a linked bingo game, who provides linked bingo 
        paper sheets to the participating organizations, who provides 
        linked bingo prize management, and who provides the linked bingo 
        game system. 
           Sec. 9.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 25c.  [LINKED BINGO GAME SYSTEM.] "Linked bingo game 
        system" means the equipment used by the linked bingo provider to 
        conduct, transmit, and track a linked bingo game.  The system 
        must be approved by the board before its use in this state and 
        it must have dial-up or other capability to permit the board to 
        monitor its operation remotely. 
           Sec. 10.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 25d.  [LINKED BINGO PRIZE POOL.] "Linked bingo prize 
        pool" means the total of all prize money that each participating 
        organization has contributed to the linked bingo game prize.  No 
        participating organization may contribute more than $300 per 
        bingo occasion to a linked bingo prize pool. 
           Sec. 11.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 36.  [VETERANS POST HOME.] "Veterans post home" means 
        a building, or portion of a building, that is leased or owned by 
        one or more licensed veterans organizations, and that is 
        considered the post home for all licensed veterans organizations 
        at that site. 
           Sec. 12.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 37.  [WHOLLY LEASED BUILDING.] "Wholly leased 
        building" means a building that is leased in its entirety by a 
        licensed organization, and no part or portion of the building is 
        subleased to any other entity or licensed organization. 
           Sec. 13.  Minnesota Statutes 2002, section 349.12, is 
        amended by adding a subdivision to read: 
           Subd. 38.  [WHOLLY OWNED BUILDING.] "Wholly owned building" 
        means a building that is owned in its entirety by a licensed 
        organization, and no part or portion of the building is 
        subleased to any other entity or licensed organization. 
           Sec. 14.  Minnesota Statutes 2002, section 349.151, 
        subdivision 4, is amended to read: 
           Subd. 4.  [POWERS AND DUTIES.] (a) The board has the 
        following powers and duties:  
           (1) to regulate lawful gambling to ensure it is conducted 
        in the public interest; 
           (2) to issue licenses to organizations, distributors, bingo 
        halls, manufacturers, linked bingo game providers, and gambling 
        managers; 
           (3) to collect and deposit license, permit, and 
        registration fees due under this chapter; 
           (4) to receive reports required by this chapter and inspect 
        all premises, records, books, and other documents of 
        organizations, distributors, manufacturers, linked bingo game 
        providers, and bingo halls to insure compliance with all 
        applicable laws and rules; 
           (5) to make rules authorized by this chapter; 
           (6) to register gambling equipment and issue registration 
        stamps; 
           (7) to provide by rule for the mandatory posting by 
        organizations conducting lawful gambling of rules of play and 
        the odds and/or house percentage on each form of lawful 
        gambling; 
           (8) to report annually to the governor and legislature on 
        its activities and on recommended changes in the laws governing 
        gambling; 
           (9) to impose civil penalties of not more than $500 per 
        violation on organizations, distributors, employees eligible to 
        make sales on behalf of a distributor, manufacturers, bingo 
        halls, linked bingo game providers, and gambling managers for 
        failure to comply with any provision of this chapter or any rule 
        or order of the board; 
           (10) to issue premises permits to organizations licensed to 
        conduct lawful gambling; 
           (11) to delegate to the director the authority to issue or 
        deny license and premises permit applications and renewals under 
        criteria established by the board; 
           (12) to suspend or revoke licenses and premises permits of 
        organizations, distributors, manufacturers, bingo halls, linked 
        bingo game providers, or gambling managers as provided in this 
        chapter; 
           (13) to register employees of organizations licensed to 
        conduct lawful gambling; 
           (14) to require fingerprints from persons determined by 
        board rule to be subject to fingerprinting; 
           (15) to delegate to a compliance review group of the board 
        the authority to investigate alleged violations, issue consent 
        orders, and initiate contested cases on behalf of the board; 
           (16) to order organizations, distributors, manufacturers, 
        bingo halls, linked bingo game providers, and gambling managers 
        to take corrective actions; and 
           (17) to take all necessary steps to ensure the integrity of 
        and public confidence in lawful gambling.  
           (b) The board, or director if authorized to act on behalf 
        of the board, may by citation assess any organization, 
        distributor, employee eligible to make sales on behalf of a 
        distributor, manufacturer, bingo hall licensee, linked bingo 
        game provider, or gambling manager a civil penalty of not more 
        than $500 per violation for a failure to comply with any 
        provision of this chapter or any rule adopted or order issued by 
        the board.  Any organization, distributor, bingo hall licensee, 
        gambling manager, linked bingo game provider, or manufacturer 
        assessed a civil penalty under this paragraph may request a 
        hearing before the board.  Appeals of citations imposing a civil 
        penalty are not subject to the provisions of the Administrative 
        Procedure Act.  
           (c) All fees and penalties received by the board must be 
        deposited in the general fund. 
           Sec. 15.  Minnesota Statutes 2002, section 349.151, 
        subdivision 4b, is amended to read: 
           Subd. 4b.  [PULL-TAB SALES FROM DISPENSING DEVICES.] (a) 
        The board may by rule authorize but not require the use of 
        pull-tab dispensing devices. 
           (b) Rules adopted under paragraph (a): 
           (1) must limit the number of pull-tab dispensing devices on 
        any permitted premises to three; and 
           (2) must limit the use of pull-tab dispensing devices to a 
        permitted premises which is (i) a licensed premises for on-sales 
        of intoxicating liquor or 3.2 percent malt beverages; or (ii) a 
        licensed bingo hall that allows gambling only by persons 18 
        years or older. 
           (c) Notwithstanding rules adopted under paragraph (b), 
        pull-tab dispensing devices may be used in establishments 
        licensed for the off-sale of intoxicating liquor, other than 
        drugstores and general food stores licensed under section 
        340A.405, subdivision 1. 
           (d) The director may charge a manufacturer a fee of up to 
        $5,000 per pull-tab dispensing device to cover the costs of 
        services provided by an independent testing laboratory to 
        perform testing and analysis of pull-tab dispensing devices.  
        The director shall deposit in a separate account in the state 
        treasury all money the director receives as reimbursement for 
        the costs of services provided by independent testing 
        laboratories that have entered into contracts with the state to 
        perform testing and analysis of pull-tab dispensing devices.  
        Money in the account is appropriated to the director to pay the 
        costs of services under those contracts. 
           Sec. 16.  Minnesota Statutes 2002, section 349.153, is 
        amended to read: 
           349.153 [CONFLICT OF INTEREST.] 
           (a) A person may not serve on the board, be the director, 
        or be an employee of the board who has an interest in any 
        corporation, association, limited liability company, or 
        partnership that is licensed by the board as a distributor, 
        manufacturer, linked bingo game provider, or a bingo hall under 
        section 349.164.  
           (b) A member of the board, the director, or an employee of 
        the board may not accept employment with, receive compensation 
        directly or indirectly from, or enter into a contractual 
        relationship with an organization that conducts lawful gambling, 
        a distributor, a linked bingo game provider, a bingo hall, or a 
        manufacturer while employed with or a member of the board or 
        within one year after terminating employment with or leaving the 
        board. 
           (c) A distributor, bingo hall, manufacturer, linked bingo 
        game provider, or organization licensed to conduct lawful 
        gambling may not hire a former employee, director, or member of 
        the gambling control board for one year after the employee, 
        director, or member has terminated employment with or left the 
        gambling control board.  
           Sec. 17.  Minnesota Statutes 2002, section 349.155, 
        subdivision 3, is amended to read: 
           Subd. 3.  [MANDATORY DISQUALIFICATIONS.] (a) In the case of 
        licenses for manufacturers, distributors, bingo halls, linked 
        bingo game providers, and gambling managers, the board may not 
        issue or renew a license under this chapter, and shall revoke a 
        license under this chapter, if the applicant or licensee, or a 
        director, officer, partner, governor, person in a supervisory or 
        management position of the applicant or licensee, or an employee 
        eligible to make sales on behalf of the applicant or licensee: 
           (1) has ever been convicted of a felony or a crime 
        involving gambling; 
           (2) has ever been convicted of (i) assault, (ii) a criminal 
        violation involving the use of a firearm, or (iii) making 
        terroristic threats; 
           (3) is or has ever been connected with or engaged in an 
        illegal business; 
           (4) owes $500 or more in delinquent taxes as defined in 
        section 270.72; 
           (5) had a sales and use tax permit revoked by the 
        commissioner of revenue within the past two years; or 
           (6) after demand, has not filed tax returns required by the 
        commissioner of revenue.  The board may deny or refuse to renew 
        a license under this chapter, and may revoke a license under 
        this chapter, if any of the conditions in this paragraph are 
        applicable to an affiliate or direct or indirect holder of more 
        than a five percent financial interest in the applicant or 
        licensee.  
           (b) In the case of licenses for organizations, the board 
        may not issue or renew a license under this chapter, and shall 
        revoke a license under this chapter, if the organization, or an 
        officer or member of the governing body of the organization:  
           (1) has been convicted of a felony or gross misdemeanor 
        within the five years before the issuance or renewal of the 
        license; 
           (2) has ever been convicted of a crime involving gambling; 
        or 
           (3) has had a license issued by the board or director 
        permanently revoked for violation of law or board rule. 
           Sec. 18.  Minnesota Statutes 2002, section 349.161, 
        subdivision 5, is amended to read: 
           Subd. 5.  [PROHIBITION.] (a) No distributor, or employee of 
        a distributor, may also be a wholesale distributor of alcoholic 
        beverages or an employee of a wholesale distributor of alcoholic 
        beverages. 
           (b) No distributor, or any representative, agent, 
        affiliate, or employee of a distributor, may: (1) be involved in 
        the conduct of lawful gambling by an organization; (2) keep or 
        assist in the keeping of an organization's financial records, 
        accounts, and inventories; or (3) prepare or assist in the 
        preparation of tax forms and other reporting forms required to 
        be submitted to the state by an organization. 
           (c) No distributor or any representative, agent, affiliate, 
        or employee of a distributor may provide a lessor of gambling 
        premises any compensation, gift, gratuity, premium, or other 
        thing of value. 
           (d) No distributor or any representative, agent, affiliate, 
        or employee of a distributor may participate in any gambling 
        activity at any gambling site or premises where gambling 
        equipment purchased from that distributor is being used in the 
        conduct of lawful gambling. 
           (e) No distributor or any representative, agent, affiliate, 
        or employee of a distributor may alter or modify any gambling 
        equipment, except to add a "last ticket sold" prize sticker. 
           (f) No distributor or any representative, agent, affiliate, 
        or employee of a distributor may:  (1) recruit a person to 
        become a gambling manager of an organization or identify to an 
        organization a person as a candidate to become gambling manager 
        for the organization; or (2) identify for an organization a 
        potential gambling location. 
           (g) No distributor may purchase gambling equipment for 
        resale to a person for use within the state from any person not 
        licensed as a manufacturer under section 349.163, except for 
        gambling equipment returned from an organization licensed under 
        section 349.16, or exempt or excluded from licensing under 
        section 349.166. 
           (h) No distributor may sell gambling equipment to any 
        person for use in Minnesota other than (i) a licensed 
        organization or organization excluded or exempt from licensing, 
        or (ii) the governing body of an Indian tribe. 
           (i) No distributor may sell or otherwise provide a pull-tab 
        or tipboard deal with the symbol required by section 349.163, 
        subdivision 5, paragraph (h), visible on the flare to any person 
        other than in Minnesota to a licensed organization or 
        organization exempt from licensing. 
           Sec. 19.  Minnesota Statutes 2002, section 349.163, 
        subdivision 3, is amended to read: 
           Subd. 3.  [PROHIBITED SALES.] (a) A manufacturer may not: 
           (1) sell gambling equipment for use or resale within the 
        state to any person not licensed as a distributor, except that 
        gambling equipment used exclusively in a linked bingo game may 
        be sold to a licensed linked bingo provider; or 
           (2) sell gambling equipment to a distributor in this state 
        that has the same serial number as another item of gambling 
        equipment of the same type that is sold by that manufacturer for 
        use or resale in this state. 
           (b) A manufacturer, affiliate of a manufacturer, or person 
        acting as a representative or agent of a manufacturer may not 
        provide a lessor of gambling premises or an appointed official 
        any compensation, gift, gratuity, premium, contribution, or 
        other thing of value. 
           (c) A manufacturer may not sell or otherwise provide a 
        pull-tab or tipboard deal with the symbol required by 
        subdivision 5, paragraph (h), imprinted on the flare to any 
        person other than a licensed distributor unless the manufacturer 
        first renders the symbol permanently invisible. 
           Sec. 20.  [349.1635] [LINKED BINGO GAME PROVIDER LICENSE.] 
           Subdivision 1.  [LICENSE REQUIRED.] No person may do any of 
        the following without having first obtained a license from the 
        board: 
           (1) provide the means to link prizes in a linked bingo 
        game; 
           (2) provide linked bingo game prize management; 
           (3) provide the linked bingo system; or 
           (4) provide linked bingo paper sheets to an organization. 
           Subd. 2.  [LICENSE APPLICATION.] The board may issue a 
        license to a linked bingo game provider who meets the 
        qualifications of this chapter and the rules promulgated by the 
        board.  The application shall be on a form prescribed by the 
        board.  The license is valid for two years and the fee for a 
        linked bingo game provider license is $5,000 per year.  
           Subd. 3.  [ATTACHMENTS TO APPLICATION.] An applicant for a 
        linked bingo game provider license must attach to its 
        application: 
           (1) evidence of a bond in the principal amount of $250,000 
        payable to the state of Minnesota conditioned on the payment of 
        all linked bingo prizes and any other money due and payable 
        under this chapter; 
           (2) detailed plans and specifications for the operation of 
        the linked bingo game and the linked bingo system; and 
           (3) any other information required by the board by rule.  
           Subd. 4.  [PROHIBITION.] (a) Except for services associated 
        exclusively with a linked bingo game, a linked bingo game 
        provider may not participate or assist in the conduct of lawful 
        gambling by an organization.  No linked bingo game provider may: 
           (1) also be licensed as a bingo hall or hold any financial 
        or managerial interest in a bingo hall; 
           (2) also be licensed as a distributor or hold any financial 
        or managerial interest in a distributor; 
           (3) sell or lease linked bingo game equipment to any person 
        not licensed as an organization; 
           (4) purchase gambling equipment to be used exclusively in a 
        linked bingo game from any person not licensed as a manufacturer 
        under section 349.163; and 
           (5) provide an organization, a lessor of gambling premises, 
        or an appointed official any compensation, gift, gratuity, 
        premium, or contribution. 
           (b) Employees of the board and the division of alcohol and 
        gambling enforcement may inspect the books, records, inventory, 
        and business premises of a licensed linked bingo game provider 
        without notice during the normal business hours of the linked 
        bingo game provider.  The board may charge a linked bingo game 
        provider for the actual cost of conducting scheduled or 
        unscheduled inspections of the licensee's facilities. 
           Sec. 21.  Minnesota Statutes 2002, section 349.166, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [EXCLUSIONS.] (a) Bingo, with the exception 
        of linked bingo games, may be conducted without a license and 
        without complying with sections 349.168, subdivisions 1 and 2; 
        349.17, subdivisions 1, 4, and 5; 349.18, subdivision 1; and 
        349.19, if it is conducted:  
           (1) by an organization in connection with a county fair, 
        the state fair, or a civic celebration and is not conducted for 
        more than 12 consecutive days and is limited to no more than 
        four separate applications for activities applied for and 
        approved in a calendar year; or 
           (2) by an organization that conducts four or fewer bingo 
        occasions in a calendar year.  
           An organization that holds a license to conduct lawful 
        gambling under this chapter may not conduct bingo under this 
        subdivision.  
           (b) Bingo may be conducted within a nursing home or a 
        senior citizen housing project or by a senior citizen 
        organization if the prizes for a single bingo game do not exceed 
        $10, total prizes awarded at a single bingo occasion do not 
        exceed $200, no more than two bingo occasions are held by the 
        organization or at the facility each week, only members of the 
        organization or residents of the nursing home or housing project 
        are allowed to play in a bingo game, no compensation is paid for 
        any persons who conduct the bingo, and a manager is appointed to 
        supervise the bingo.  Bingo conducted under this paragraph is 
        exempt from sections 349.11 to 349.23, and the board may not 
        require an organization that conducts bingo under this 
        paragraph, or the manager who supervises the bingo, to register 
        or file a report with the board.  The gross receipts from bingo 
        conducted under the limitations of this subdivision are exempt 
        from taxation under chapter 297A.  
           (c) Raffles may be conducted by an organization without a 
        license and without complying with sections 349.154 to 349.165 
        and 349.167 to 349.213 if the value of all raffle prizes awarded 
        by the organization in a calendar year does not 
        exceed $750 $1,500.  
           (d) Except as provided in paragraph (b), the organization 
        must maintain all required records of excluded gambling activity 
        for 3-1/2 years. 
           Sec. 22.  Minnesota Statutes 2002, section 349.166, 
        subdivision 2, is amended to read: 
           Subd. 2.  [EXEMPTIONS.] (a) Lawful gambling, with the 
        exception of linked bingo games, may be conducted by an 
        organization without a license and without complying with 
        sections 349.168, subdivisions 1 and 2; 349.17, subdivisions 4 
        and 5; 349.18, subdivision 1; and 349.19 if: 
           (1) the organization conducts lawful gambling on five or 
        fewer days in a calendar year; 
           (2) the organization does not award more than $50,000 in 
        prizes for lawful gambling in a calendar year; 
           (3) the organization pays a fee of $25 to the board, 
        notifies the board in writing not less than 30 days before each 
        lawful gambling occasion of the date and location of the 
        occasion, or 60 days for an occasion held in the case of a city 
        of the first class, the types of lawful gambling to be 
        conducted, the prizes to be awarded, and receives an exemption 
        identification number; 
           (4) the organization notifies the local government unit 30 
        days before the lawful gambling occasion, or 60 days for an 
        occasion held in a city of the first class; 
           (5) the organization purchases all gambling equipment and 
        supplies from a licensed distributor; and 
           (6) the organization reports to the board, on a single-page 
        form prescribed by the board, within 30 days of each gambling 
        occasion, the gross receipts, prizes, expenses, expenditures of 
        net profits from the occasion, and the identification of the 
        licensed distributor from whom all gambling equipment was 
        purchased.  
           (b) If the organization fails to file a timely report as 
        required by paragraph (a), clause (3) or (6), the board shall 
        not issue any authorization, license, or permit to the 
        organization to conduct lawful gambling on an exempt, excluded, 
        or licensed basis until the report has been filed. 
           (c) Merchandise prizes must be valued at their fair market 
        value. 
           (d) Unused pull-tab and tipboard deals must be returned to 
        the distributor within seven working days after the end of the 
        lawful gambling occasion.  The distributor must accept and pay a 
        refund for all returns of unopened and undamaged deals returned 
        under this paragraph. 
           (e) An organization that is exempt from taxation on 
        purchases of pull-tabs and tipboards under section 297E.02, 
        subdivision 4, paragraph (b), clause (4), must return to the 
        distributor any tipboard or pull-tab deal no part of which is 
        used at the lawful gambling occasion for which it was purchased 
        by the organization. 
           (f) The organization must maintain all required records of 
        exempt gambling activity for 3-1/2 years. 
           Sec. 23.  Minnesota Statutes 2002, section 349.167, 
        subdivision 4, is amended to read: 
           Subd. 4.  [TRAINING OF GAMBLING MANAGERS.] The board shall 
        by rule require all persons licensed as gambling managers to 
        receive periodic training in laws and rules governing lawful 
        gambling.  The rules must contain the following requirements: 
           (1) each gambling manager must receive training before 
        being issued a new license, except that in the case of the 
        death, disability, or termination of a gambling manager, a 
        replacement gambling manager must receive the training within 90 
        days of being issued a license; 
           (2) each gambling manager applying for a renewal of a 
        license must have received continuing education training, as 
        required by board rule, each year of the two-year license 
        period, or pass a gambling manager examination as required in 
        subdivision 7; and 
           (3) the training required by this subdivision may be 
        provided by a person authorized by the board to provide the 
        training.  Before authorizing a person to provide training, the 
        board must determine that: 
           (i) the provider and all of the provider's personnel 
        conducting the training are qualified to do so; 
           (ii) the curriculum to be used fully and accurately covers 
        all elements of lawful gambling law and rules that the board 
        determines are necessary for a gambling manager to know and 
        understand; 
           (iii) the fee to be charged for participants in the 
        training sessions is fair and reasonable; and 
           (iv) the training provider has an adequate system for 
        documenting completion of training. 
           The rules may provide for differing training requirements 
        for gambling managers based on the class of license held by the 
        gambling manager's organization. 
           The board or the director may provide the training required 
        by this subdivision using employees of the board. 
           Sec. 24.  Minnesota Statutes 2002, section 349.167, 
        subdivision 6, is amended to read: 
           Subd. 6.  [RECRUITMENT OF GAMBLING MANAGERS.] No 
        organization may seek or accept assistance from a manufacturer 
        or, distributor, or linked bingo game provider, or a 
        representative, agent, affiliate, or employee of a manufacturer 
        or, distributor, or linked bingo game provider, in identifying 
        or recruiting candidates to become a gambling manager for the 
        organization. 
           Sec. 25.  Minnesota Statutes 2002, section 349.167, 
        subdivision 7, is amended to read: 
           Subd. 7.  [GAMBLING MANAGER EXAMINATION.] Each applicant 
        for a new gambling manager's license, and each renewing 
        applicant that has failed to receive training as required in 
        subdivision 4, must pass an examination prepared and 
        administered by the board that tests the applicant's knowledge 
        of the responsibilities of gambling managers, and of gambling 
        procedures, laws, and rules before being issued the license.  In 
        the case of the death, disability, or termination of a gambling 
        manager, a replacement gambling manager must pass the 
        examination within 90 days of being issued a gambling manager's 
        license.  The board shall revoke the replacement gambling 
        manager's license if the replacement gambling manager fails to 
        pass the examination as required in this subdivision. 
           Sec. 26.  Minnesota Statutes 2002, section 349.168, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [REGISTRATION OF EMPLOYEES.] A person may 
        not receive compensation for participating in the conduct of 
        lawful gambling as an employee of a licensed organization unless 
        the person has first registered with the board on a form the 
        board prescribes.  The form must require each registrant to 
        provide:  (1) the person's name, address, and date of birth, and 
        social security number; (2) a current photograph; and (3) the 
        name, address, and license number of the employing organization. 
           Sec. 27.  Minnesota Statutes 2002, section 349.168, 
        subdivision 2, is amended to read: 
           Subd. 2.  [IDENTIFICATION OF EMPLOYEES.] The board shall 
        issue to each person registering under subdivision 1 a 
        registration number and identification card which must include 
        the employee's photograph.  Each person receiving compensation 
        for the conduct of lawful gambling must wear the identification 
        card provided by the board publicly display the person's name at 
        all times while conducting the lawful gambling. 
           Sec. 28.  Minnesota Statutes 2002, section 349.168, 
        subdivision 6, is amended to read: 
           Subd. 6.  [COMPENSATION PAID BY CHECK OR ELECTRONIC 
        TRANSFER.] Compensation paid by an organization in connection 
        with lawful gambling must either be:  (1) in the form of a check 
        drawn on the organization's gambling account, as specified in 
        section 349.19, and paid directly to the person being 
        compensated; (2) transferred electronically from the 
        organization's gambling account, as specified in section 349.19, 
        subdivision 3, directly to the employee's bank account; or (3) 
        transferred electronically from the organization's gambling 
        account to the account of a payroll processing firm from which 
        payment in the form of a check is paid directly to the person 
        being compensated; or (4) transferred electronically to and from 
        the account of a payroll processing firm for payment to the 
        employee's account and for the payment of local, state, and 
        federal withholding taxes, provided that the payroll processing 
        firm is (i) currently registered with and meets the criteria of 
        the department of revenue as a third-party bulk filer under 
        section 290.92, subdivision 30, (ii) is able to provide proof of 
        a third-party audit and an annual report and statement of 
        financial condition, (iii) is able to provide evidence of a 
        fidelity bond, and (iv) can provide proof of having been in 
        business as a third-party bulk filer for the most recent three 
        years. 
           Sec. 29.  Minnesota Statutes 2002, section 349.168, is 
        amended by adding a subdivision to read: 
           Subd. 10.  [EMPLOYMENT OF CERTAIN PERSONS.] An organization 
        that sells pull-tabs and tip boards on leased premises within a 
        booth operation may not employ, other than as a seller of 
        pull-tabs and tip boards, the lessor of those premises or a 
        person who is employed by the lessor of those premises. 
           Sec. 30.  Minnesota Statutes 2002, section 349.169, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [FILING REQUIRED.] All When required by the 
        board, manufacturers and distributors must file with the 
        director, not later than the first day of each month, the prices 
        at which the manufacturer or distributor will sell all gambling 
        equipment in that month currently offered for sale by that 
        manufacturer or distributor.  The filing must be on a form in a 
        format the director prescribes.  Prices filed must include all 
        charges the manufacturer or distributor makes for each item of 
        gambling equipment sold, including all volume discounts, 
        exclusive of transportation costs.  All filings are effective on 
        the first day of the month for which they are filed, except that 
        a manufacturer or distributor may amend a filed price within 
        five days of filing it and may file a price any time during a 
        month for gambling equipment not previously included on that 
        month's filed pricing report, but may not later amend the price 
        during the month. 
           Sec. 31.  Minnesota Statutes 2002, section 349.169, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SALES AT FILED PRICES.] When required to report 
        under subdivision 1, no manufacturer may sell to a distributor, 
        and no distributor may sell to an organization, any gambling 
        equipment for any price other than a price the manufacturer or 
        distributor has filed with the director under subdivision 
        1, including volume discounts, and exclusive of transportation 
        costs. 
           Sec. 32.  Minnesota Statutes 2002, section 349.17, 
        subdivision 3, is amended to read: 
           Subd. 3.  [WINNERS.] Each bingo winner must be determined 
        and every prize shall be awarded and delivered the same day on 
        which the bingo occasion is conducted, except that prizes won in 
        a linked bingo game must be delivered within three business days 
        of the day on which the occasion was conducted. 
           Sec. 33.  Minnesota Statutes 2002, section 349.17, 
        subdivision 6, is amended to read: 
           Subd. 6.  [CONDUCT OF BINGO.] (a) Each bingo hard card and 
        paper sheets must have five horizontal rows of spaces with each 
        row except one having five numbers.  The center row must have 
        four numbers and the center space marked "free."  Each column 
        must have one of the letters B-I-N-G-O in order at the top.  
        Bingo paper sheets may also have numbers that are not preprinted 
        but are filled in by players. 
           (b) A game of bingo begins with the first letter and number 
        called.  Each player must cover or mark with a liquid dauber the 
        numbers when bingo balls, similarly numbered, are randomly 
        drawn, announced, and displayed to the players, either manually 
        or with a flashboard and monitor.  The game is won when a player 
        has covered or marked a previously designated arrangement of 
        numbers on the card or sheet and declared bingo.  The game is 
        completed when a winning card or sheet is verified and a prize 
        awarded, except that prizes won in linked bingo games may be 
        awarded pursuant to subdivision 3.  
           Sec. 34.  Minnesota Statutes 2002, section 349.17, 
        subdivision 7, is amended to read: 
           Subd. 7.  [NOON HOUR BINGO.] Notwithstanding subdivisions 1 
        and 3, an organization may conduct bingo subject to the 
        following restrictions: 
           (1) the bingo is conducted only between the hours of 11:00 
        a.m. and 2:00 p.m.; 
           (2) the bingo is conducted at a site the organization owns 
        or leases and which has a license for the sale of intoxicating 
        beverages on the premises under chapter 340A; 
           (3) the bingo is limited to one progressive bingo game per 
        site as defined by section 349.211, subdivision 2; 
           (4) the bingo is conducted using only bingo paper sheets; 
        and 
           (5) if the premises are leased, the rent may not exceed $25 
        per day for each day bingo is conducted; and 
           (6) linked bingo games may not be conducted at a noon hour 
        bingo occasion. 
           Sec. 35.  Minnesota Statutes 2002, section 349.17, is 
        amended by adding a subdivision to read: 
           Subd. 8.  [LINKED BINGO GAMES.] (a) A licensed organization 
        may conduct or participate in a linked bingo game in association 
        with one or more other licensed organizations. 
           (b) Each participating licensed organization shall 
        contribute to each prize awarded in a linked bingo game in an 
        amount not to exceed $300 per occasion. 
           (c) The board may adopt rules to: 
           (1) specify the manner in which a linked bingo game must be 
        played and how the linked bingo prizes must be awarded; 
           (2) specify the records to be maintained by a linked bingo 
        game provider; 
           (3) require the submission of periodic reports by the 
        linked bingo game provider and specify the content of the 
        reports; 
           (4) establish the qualifications required to be licensed as 
        a linked bingo game provider; and 
           (5) any other matter involving the operation of a linked 
        bingo game. 
           Sec. 36.  Minnesota Statutes 2002, section 349.18, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [LEASE OR OWNERSHIP REQUIRED; RENT 
        LIMITATIONS.] (a) An organization may conduct lawful gambling 
        only on premises it owns or leases.  Leases must be on a form 
        prescribed by the board.  Except for leases entered into before 
        August 1, 1994, the term of the lease may not begin before the 
        effective date of the premises permit and must expire on the 
        same day that the premises permit expires.  Copies of all leases 
        must be made available to employees of the board and the 
        division of alcohol and gambling enforcement on request.  A 
        lease may not provide for payments determined directly or 
        indirectly by the receipts or profits from lawful gambling.  The 
        board may prescribe by rule limits on the amount of rent which 
        an organization may pay to a lessor for premises leased for 
        lawful gambling provided that no rule of the board may prescribe 
        a limit of less than $1,000 per month on rent paid for premises 
        used for lawful gambling other than bingo.  Any rule adopted by 
        the board limiting the amount of rent to be paid may only be 
        effective for leases entered into, or renewed, after the 
        effective date of the rule. 
           (b) Rent paid by an organization for leased premises is 
        subject to the following limits: 
           (1) for booth operations, including booth operations where 
        a pull-tab dispensing device is located, booth operations where 
        a bar operation is also conducted, and booth operations where 
        both a pull-tab dispensing device is located and a bar operation 
        is also conducted, the maximum rent is: 
           (i) in any month where the organization's gross profit at 
        those premises does not exceed $4,000, up to $400; and 
           (ii) in any month where the organization's gross profit at 
        those premises exceeds $4,000, up to $400 plus not more than ten 
        percent of the gross profit for that month in excess of $4,000; 
           (2) for bar operations, including bar operations where a 
        pull-tab dispensing device is located but not including bar 
        operations subject to clause (1), and for locations where only a 
        pull-tab dispensing device is located: 
           (i) in any month where the organization's gross profit at 
        those premises does not exceed $1,000, up to $200; and 
           (ii) in any month where the organization's gross profit at 
        those premises exceeds $1,000, up to $200 plus not more than 20 
        percent of the gross profit for that month in excess of $1,000; 
           (3) a lease not governed by clauses (1) and (2) must be 
        approved by the board before becoming effective; 
           (4) total rent paid to a lessor from all organizations from 
        leases governed by clause (1) may not exceed $1,750 per month.  
        Total rent paid to a lessor from all organizations from leases 
        governed by clause (2) may not exceed $2,000 per month.  
           (c) Amounts paid as rent under leases are all-inclusive.  
        No other services provided or contracted by the lessor may be 
        paid by the organization, including, but not limited to, trash 
        removal, janitorial and cleaning services, snow removal, lawn 
        services, electricity, heat, security, security monitoring, 
        storage, other utilities or services, and, in the case of bar 
        operations, compensation for cash shortages.  Any other 
        expenditure made by an organization that is related to a leased 
        premises must be approved by the director.  An organization may 
        not provide any compensation or thing of value to a lessor or 
        the lessor's employees from any fund source other than its 
        gambling account.  Rent payments may not be made to an 
        individual. 
           (d) Notwithstanding paragraph (b), an organization may pay 
        a lessor for food or beverages or meeting room rental if the 
        charge made is comparable to similar charges made to other 
        individuals or groups. 
           (e) No person, distributor, manufacturer, lessor, linked 
        bingo game provider, or organization other than the licensed 
        organization leasing the space may conduct any activity other 
        than the sale or serving of food and beverages on the leased 
        premises during times when lawful gambling is being conducted on 
        the premises. 
           (c) (f) At a site where the leased premises consists of an 
        area on or behind a bar at which alcoholic beverages are sold 
        and employees of the lessor are employed by the organization as 
        pull-tab sellers at the site, pull-tabs and tipboard tickets may 
        be sold and redeemed by those employees at any place on or 
        behind the bar, but the tipboards and receptacles for pull-tabs 
        and cash drawers for lawful gambling receipts must be maintained 
        only within the leased premises. 
           (d) (g) Employees of a lessor may participate in lawful 
        gambling on the premises provided (1) if pull-tabs or tipboards 
        are sold, the organization voluntarily posts, or is required to 
        post, the major prizes as specified in section 349.172; and (2) 
        any employee of the lessor participating in lawful gambling is 
        not a gambling employee for the organization conducting lawful 
        gambling on the premises. 
           (e) (h) A gambling employee may purchase pull-tabs at the 
        site of the employee's place of employment provided: 
           (1) the organization voluntarily posts, or is required to 
        post, the major prizes for pull-tab or tipboard games as 
        specified in section 349.172; and 
           (2) the employee is not involved in the sale of pull-tabs 
        at that site. 
           (f) (i) At a leased site where an organization uses a 
        paddlewheel consisting of 30 numbers or less or a tipboard 
        consisting of 30 tickets or less, tickets may be sold throughout 
        the permitted premises, but winning tickets must be redeemed, 
        the paddlewheel must be located, and the tipboard seal must be 
        opened within the leased premises. 
           [EFFECTIVE DATE.] This section is effective May 31, 2003, 
        and applies to leases entered into or amended on and after that 
        date. 
           Sec. 37.  Minnesota Statutes 2002, section 349.19, is 
        amended by adding a subdivision to read: 
           Subd. 2b.  [LINKED BINGO PRIZE POOL ACCOUNT.] A licensed 
        organization participating in a linked bingo game must maintain 
        a separate account in a bank for the deposit of the 
        organization's portion of the linked bingo game prize pool.  The 
        name of the bank, the account number, and authorization for 
        electronic funds transfer must be provided by the organization 
        to the linked bingo game provider.  Deposits must be made into 
        the account by the organization as designated by the linked 
        bingo game provider.  Money in the account must be available to 
        the linked bingo game provider at all times by electronic funds 
        transfer, unless the linked bingo provider agrees to the 
        transfer of the funds by other means. 
           Sec. 38.  Minnesota Statutes 2002, section 349.19, 
        subdivision 3, is amended to read: 
           Subd. 3.  [EXPENDITURES.] (a) All expenditures of gross 
        profits from lawful gambling must be itemized as to payee, 
        purpose, amount, and date of payment, and must be in compliance 
        with section 349.154.  Authorization of the expenditures must be 
        recorded in the monthly meeting minutes of the licensed 
        organization.  Checks or authorizations for electronic fund 
        transfers for expenditures of gross profits must be signed by at 
        least two persons authorized by board rules to sign the checks.  
        Expenditures of gross profits from lawful gambling for local, 
        state, and federal taxes as identified in section 349.12, 
        subdivision 25, paragraph (a), clause (8), may be:  (1) 
        transferred electronically from the organization's gambling 
        account directly to bank accounts identified by local, state, or 
        federal agencies if the organization's gambling account monthly 
        bank statement specifically identifies the payee by name, the 
        amount transferred, the account number of the account into which 
        the funds were transferred, and the date of the transaction; or 
        (2) transferred electronically to and from the account of a 
        payroll processing firm that meets the criteria for such a firm 
        established under section 349.168, subdivision 6.  Expenditures 
        of gross profits from lawful gambling as identified in section 
        349.12, subdivision 3a, and as authorized by section 349.15, 
        subdivision 1, for utility payments for utilities, insurance, 
        and payroll processing charges may be transferred electronically 
        from the organization's gambling account directly to bank 
        accounts identified by the utility vendor if the organization's 
        gambling account monthly bank statement specifically identifies 
        the payee by name, the amount transferred, the account number of 
        the account into which the funds were transferred, and the date 
        of the transaction.  Electronic payments of local, state, and 
        federal taxes and utility, payroll processing, or insurance 
        payments are permitted only if they have been authorized by the 
        membership, the organization maintains supporting documentation, 
        and the expenditures can be verified. 
           (b) Expenditures authorized by the board according to 
        section 349.12, subdivision 25, paragraph (b), clause (3), must 
        be 51 percent completed within two years of the date of board 
        approval.  "Fifty-one percent completed" means that the work 
        completed must represent at least 51 percent of the value of the 
        project as documented by the contractor or vendor.  An 
        organization that fails to comply with this paragraph shall 
        reapply to the board for approval of the project. 
           Sec. 39.  Minnesota Statutes 2002, section 349.191, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [CREDIT RESTRICTION.] A manufacturer may 
        not offer or extend to a distributor, a linked bingo game 
        provider may not offer or extend to an organization, and a 
        distributor may not offer or extend to an organization, credit 
        for a period of more than 30 days for the sale or lease of any 
        gambling equipment.  No right of action exists for the 
        collection of any claim based on credit prohibited by this 
        subdivision.  The 30-day period allowed by this subdivision 
        begins with the day immediately following the day of invoice and 
        includes all successive days, including Sundays and holidays, to 
        and including the 30th successive day. 
           Sec. 40.  Minnesota Statutes 2002, section 349.191, 
        subdivision 1a, is amended to read: 
           Subd. 1a.  [CREDIT AND SALES TO DELINQUENT ORGANIZATIONS.] 
        (a) If a distributor or linked bingo game provider does not 
        receive payment in full from an organization within 35 days of 
        the day immediately following the date of the invoice, the 
        distributor or linked bingo game provider must notify the board 
        in writing of the delinquency on the next business day. 
           (b) If a distributor or linked bingo game provider who has 
        notified the board under paragraph (a) has not received payment 
        in full from the organization within 60 days of the notification 
        under paragraph (a), the distributor or linked bingo game 
        provider must notify the board of the continuing delinquency. 
           (c) On receipt of a notice under paragraph (a), the board 
        shall order all distributors and linked bingo game providers 
        that until further notice from the board, they may sell gambling 
        equipment to the delinquent organizations only on a cash basis 
        with no credit extended.  On receipt of a notice under paragraph 
        (b), the board shall order all distributors and linked bingo 
        game providers not to sell any gambling equipment to the 
        delinquent organization. 
           (d) No distributor or linked bingo game provider may extend 
        credit or sell gambling equipment to an organization in 
        violation of an order under paragraph (c) until the board has 
        authorized such credit or sale. 
           Sec. 41.  Minnesota Statutes 2002, section 349.211, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [BINGO.] Except as provided in 
        subdivision subdivisions 1a and 2, prizes for a single bingo 
        game may not exceed $200 except prizes for a cover-all game, 
        which may exceed $200 if the aggregate value of all cover-all 
        prizes in a bingo occasion does not exceed $1,000.  Total prizes 
        awarded at a bingo occasion may not exceed $2,500, unless a 
        cover-all game is played in which case the limit is $3,500.  A 
        prize may be determined based on the value of the bingo packet 
        sold to the player.  For purposes of this subdivision, a 
        cover-all game is one in which a player must cover all spaces 
        except a single free space to win. 
           Sec. 42.  Minnesota Statutes 2002, section 349.211, is 
        amended by adding a subdivision to read: 
           Subd. 1a.  [LINKED BINGO PRIZES.] Prizes for a linked bingo 
        game shall be limited as follows: 
           (1) no organization may contribute more than $300 per 
        occasion to a linked bingo game prize pool; and 
           (2) if an organization contributes to a linked bingo game 
        prize pool, the organization's aggregate value of cover-all 
        prizes available during the bingo occasion must be reduced by 
        the amount contributed to the linked bingo game prize pool. 
           Sec. 43.  Minnesota Statutes 2002, section 609.761, 
        subdivision 5, is amended to read: 
           Subd. 5.  [HIGH SCHOOL RAFFLES.] Sections 609.755 and 
        609.76 do not prohibit a raffle, as defined in section 349.12, 
        subdivision 33, conducted by a school district or a nonprofit 
        organization organized primarily to support programs of a school 
        district, if the following conditions are complied with: 
           (1) tickets for the raffle may only be sold and the drawing 
        conducted at a high school event sponsored by a school 
        district.  All tickets must be sold for the same price; 
           (2) tickets may only be sold to persons 18 years of age or 
        older attending the event; 
           (3) the drawing must be held during or immediately after 
        the conclusion of the event; and 
           (4) one-half of the gross receipts from the sale of tickets 
        must be awarded as prizes for the raffle, and the remaining 
        one-half may only be expended to defray the school district's 
        costs of sending event participants to high school activities 
        held at other locations; and 
           (5) if a school district's or nonprofit organization's 
        gross receipts from the conduct of raffles exceeds $12,000 in a 
        calendar year or $5,000 in a single raffle, the school district 
        or organization must report the following information to the 
        gambling control board annually:  the total amount of gross 
        receipts received, the total expenses for the raffles, the total 
        prizes awarded, and an accounting of the expenditures from the 
        gross receipts of the raffles.  
           Sec. 44.  [REPEALER.] 
           Minnesota Statutes 2002, section 349.168, subdivision 9, is 
        repealed. 
           Presented to the governor May 23, 2003 
           Signed by the governor May 27, 2003, 4:08 p.m.