1.1                          A bill for an act 
  1.2             relating to gambling; authorizing the state lottery to 
  1.3             lease space for and operate a casino in the main 
  1.4             terminal of the Minneapolis-St. Paul International 
  1.5             Airport; appropriating money; amending Minnesota 
  1.6             Statutes 2002, sections 349A.01, by adding a 
  1.7             subdivision; 349A.10, subdivisions 2, 3, 5; 349A.11, 
  1.8             subdivision 1; 541.20; 541.21; 609.75, subdivision 3; 
  1.9             609.761, subdivision 2; proposing coding for new law 
  1.10            in Minnesota Statutes, chapter 349A. 
  1.11  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.12     Section 1.  Minnesota Statutes 2002, section 349A.01, is 
  1.13  amended by adding a subdivision to read: 
  1.14     Subd. 8a.  [CASINO NET PROCEEDS.] "Casino net proceeds" 
  1.15  means total revenues received by the director from the operation 
  1.16  of a casino under section 349A.17, less prizes and winnings paid 
  1.17  out and the capital and operating costs of the casino. 
  1.18     Sec. 2.  Minnesota Statutes 2002, section 349A.10, 
  1.19  subdivision 2, is amended to read: 
  1.20     Subd. 2.  [DEPOSIT IN PRIZE FUND.] (a) The director shall 
  1.21  establish a lottery prize fund outside the state treasury.  The 
  1.22  fund consists of all money deposited in it under this 
  1.23  subdivision and all interest earned thereon.  
  1.24     (b) The director shall deposit in the lottery prize fund, 
  1.25  from gross receipts from the sale of lottery tickets, an amount 
  1.26  sufficient to pay lottery prizes, other than prizes and winnings 
  1.27  from the casino under section 349A.17, from the lottery prize 
  1.28  fund according to the following provisions: 
  2.1      (1) for games which require on-line terminal connections, 
  2.2   the prizes paid in any fiscal year must be at least 45 percent 
  2.3   of gross receipts from those games in that fiscal year; 
  2.4      (2) for games which do not require on-line terminal 
  2.5   connections, the prizes paid in any fiscal year must be at least 
  2.6   the following percentages of gross receipts from those games:  
  2.7      (i) 50 percent through fiscal year 1991; 
  2.8      (ii) 55 percent from July 1, 1991, to June 30, 1992; and 
  2.9      (iii) 60 percent thereafter.  
  2.10     Sec. 3.  Minnesota Statutes 2002, section 349A.10, 
  2.11  subdivision 3, is amended to read: 
  2.12     Subd. 3.  [LOTTERY OPERATIONS.] (a) The director shall 
  2.13  establish a lottery operations account in the lottery fund.  The 
  2.14  director shall pay all costs of operating the lottery, including 
  2.15  payroll costs or amounts transferred to the state treasury for 
  2.16  payroll costs, but not including lottery prizes or costs of 
  2.17  operating the casino under section 349A.10, from the lottery 
  2.18  operating account.  The director shall credit to the lottery 
  2.19  operations account amounts sufficient to pay the operating costs 
  2.20  of the lottery other than casino operating costs. 
  2.21     (b) Except as provided in paragraph (e), the director may 
  2.22  not credit in any fiscal year thereafter amounts to the lottery 
  2.23  operations account which when totaled exceed 15 percent of gross 
  2.24  revenue to the lottery fund in that fiscal year.  In computing 
  2.25  total amounts credited to the lottery operations account under 
  2.26  this paragraph the director shall disregard amounts transferred 
  2.27  to or retained by lottery retailers as sales commissions or 
  2.28  other compensation. 
  2.29     (c) The director of the lottery may not expend after July 
  2.30  1, 1991, more than 2-3/4 percent of gross revenues in a fiscal 
  2.31  year for contracts for the preparation, publication, and 
  2.32  placement of advertising.  This restriction does not apply to 
  2.33  advertising for the casino under section 349A.17.  
  2.34     (d) Except as the director determines, the lottery is not 
  2.35  subject to chapter 16A relating to budgeting, payroll, and the 
  2.36  purchase of goods and services. 
  3.1      (e) In addition to the amounts credited to the lottery 
  3.2   operations account under paragraph (b), the director is 
  3.3   authorized, if necessary, to meet the current obligations of the 
  3.4   lottery and to credit up to 25 percent of an amount equal to the 
  3.5   average annual amount which was authorized to be credited to the 
  3.6   lottery operations account for the previous three fiscal years 
  3.7   but was not needed to meet the obligations of the lottery. 
  3.8      (f) The director shall establish a casino operations 
  3.9   account in the lottery fund.  The director shall credit to the 
  3.10  casino operations account amounts sufficient to pay the 
  3.11  operating costs of the casino, including prizes and winnings at 
  3.12  the casino.  The director shall pay from the casino operations 
  3.13  fund all costs of operating the casino established under section 
  3.14  349A.17, including payroll costs or amounts transferred to the 
  3.15  state treasury for payroll costs and all amounts paid out as 
  3.16  prizes or winnings at the casino. 
  3.17     Sec. 4.  Minnesota Statutes 2002, section 349A.10, 
  3.18  subdivision 5, is amended to read: 
  3.19     Subd. 5.  [DEPOSIT OF NET PROCEEDS.] Within 30 days after 
  3.20  the end of each month, the director shall deposit in the state 
  3.21  treasury the net proceeds of the lottery, which is the balance 
  3.22  in the lottery fund after transfers to the lottery prize fund 
  3.23  and credits to the lottery operations account and casino net 
  3.24  proceeds.  Of the net proceeds, 40 percent must be credited to 
  3.25  the Minnesota environment and natural resources trust fund and 
  3.26  the remainder must be credited to the general fund.  
  3.27     Sec. 5.  Minnesota Statutes 2002, section 349A.11, 
  3.28  subdivision 1, is amended to read: 
  3.29     Subdivision 1.  [LOTTERY TICKET; RETAILER.] The director, 
  3.30  an employee of the lottery, a member of the immediate family of 
  3.31  the director or employee residing in the same household may not: 
  3.32     (1) purchase a lottery ticket or participate in gambling at 
  3.33  the casino established under section 349A.17; or 
  3.34     (2) have any personal pecuniary interest in any vendor 
  3.35  holding a lottery procurement contract, or in any lottery 
  3.36  retailer; or 
  4.1      (3) receive any gift, gratuity, or other thing of value, 
  4.2   excluding food or beverage, from any lottery vendor or lottery 
  4.3   retailer, or person applying to be a retailer or vendor, in 
  4.4   excess of $100 in any calendar year.  
  4.5      Sec. 6.  [349A.17] [OPERATION OF CASINO.] 
  4.6      Subdivision 1.  [AGREEMENT.] The director shall lease a 
  4.7   facility within the main terminal of the Minneapolis-St. Paul 
  4.8   International Airport for the purpose of operating a casino.  
  4.9   The metropolitan airports commission shall not unreasonably 
  4.10  refuse to lease space in the main terminal for this purpose. 
  4.11     Subd. 2.  [TYPES OF GAMBLING.] The director shall provide 
  4.12  for the types of gambling to be conducted at the casino and game 
  4.13  procedures subject to section 349A.04.  Section 349A.13, clause 
  4.14  (2), does not apply to gambling conducted at the casino. 
  4.15     Subd. 3.  [CONTRACTS.] The director may contract with 
  4.16  private vendors for goods and services for the casino, 
  4.17  consistent with the constitutional requirement that the casino 
  4.18  be state-operated.  Contracts under this section are subject to 
  4.19  section 349A.07. 
  4.20     Subd. 4.  [PERSONNEL.] (a) The director may as necessary 
  4.21  appoint personnel to operate the casino in accordance with 
  4.22  section 349A.02, subdivision 6, and with chapter 43A, except 
  4.23  that all employees will be in the unclassified service. 
  4.24     (b) No person or entity that holds a contract for the 
  4.25  supply of goods or services to the director may employ in any 
  4.26  capacity that relates directly to casino operations, or have as 
  4.27  a partner, officer, or director, any person who has been 
  4.28  convicted within the previous five years of a felony or gross 
  4.29  misdemeanor, any crime involving fraud or misrepresentation, or 
  4.30  any gambling-related offense.  Failure by a contractor to comply 
  4.31  with this requirement is grounds for termination of the contract.
  4.32     Subd. 5.  [EMPLOYEE LICENSES.] (a) For purposes of this 
  4.33  subdivision, "employee" means a person employed at the casino by 
  4.34  a person or entity holding a contract with the director to 
  4.35  provide goods or services to the casino. 
  4.36     (b) The director shall by rule prescribe the occupations 
  5.1   that the director determines requires licensing in order to 
  5.2   ensure the integrity of gambling at the casino, and the fee for 
  5.3   each licensing category.  No person may be an employee at the 
  5.4   casino in an occupation covered by the director's rules unless 
  5.5   the person has a license issued by the director for that 
  5.6   occupation. 
  5.7      (c) An application for a license under this subdivision 
  5.8   must be accompanied by an affidavit of qualification that the 
  5.9   applicant has not (1) been convicted within the previous five 
  5.10  years of a felony or gross misdemeanor, a crime involving fraud 
  5.11  or misrepresentation, or a gambling-related offense, or (2) been 
  5.12  determined to have violated a rule of the director, the racing 
  5.13  commission, the gambling control board, or a gambling-related 
  5.14  regulatory body in another state. 
  5.15     (d) The director shall investigate each applicant for a 
  5.16  license under this subdivision to the extent the director deems 
  5.17  necessary and may request the assistance of and may reimburse 
  5.18  the division of alcohol and gambling enforcement in 
  5.19  investigating applicants.  The director may by rule require that 
  5.20  an applicant be fingerprinted or furnish the applicant's 
  5.21  fingerprints.  The director may charge an applicant an 
  5.22  investigation fee to cover the cost of the investigation and 
  5.23  shall from this fee reimburse the division of alcohol and 
  5.24  gambling enforcement for its share of the cost of the 
  5.25  investigation.  The director may cooperate with national and 
  5.26  international organizations and agencies in conducting 
  5.27  investigations.  The director may by rule provide for examining 
  5.28  the qualifications of an applicant for the license being applied 
  5.29  for.  The director has access to all criminal history data 
  5.30  compiled by the division of alcohol and gambling enforcement on 
  5.31  applicants and licensees under this subdivision. 
  5.32     (e) If after compliance with this subdivision the director 
  5.33  determines that an applicant is not disqualified under paragraph 
  5.34  (c) and that licensing the applicant is consistent with the 
  5.35  public health, welfare, and safety, the director shall issue a 
  5.36  license to an applicant or renew a license already issued.  
  6.1   Licenses under this subdivision are valid for one year from the 
  6.2   date of issuance. 
  6.3      (f) The director may revoke or refuse to renew a license 
  6.4   under this subdivision for (1) conduct, including a violation of 
  6.5   a law or rule that the director determines adversely affects the 
  6.6   integrity of gambling at the casino, and (2) intentionally 
  6.7   making a false statement in a license application.  The director 
  6.8   may suspend a license for a period of time the director 
  6.9   determines for a violation of law or rule. 
  6.10     (g) A license revocation or suspension under this 
  6.11  subdivision for more than 90 days is a contested case under 
  6.12  sections 14.57 to 14.69 of the Administrative Procedure Act and 
  6.13  is in addition to criminal penalties imposed for a violation of 
  6.14  law or rule.  The director may summarily suspend a license for 
  6.15  more than 90 days prior to a contested case hearing where it is 
  6.16  necessary to ensure the integrity of gambling at the casino.  A 
  6.17  contested case hearing must be held within 20 days of the 
  6.18  summary suspension and the administrative law judge's report 
  6.19  must be issued within 20 days from the close of the hearing 
  6.20  record.  In all cases involving summary suspension the director 
  6.21  must issue its final decision within 30 days from receipt of the 
  6.22  report of the administrative law judge and subsequent exceptions 
  6.23  and arguments under section 14.61. 
  6.24     Subd. 6.  [PRIZES.] A person who plays a game at the casino 
  6.25  agrees to be bound by the game procedures applicable to that 
  6.26  game.  The player acknowledges that the determination of 
  6.27  winnings is subject to the rules of the director, game 
  6.28  procedures and claim procedures established for that game, and 
  6.29  any confidential or public validation procedures established by 
  6.30  the director for that game. 
  6.31     Subd. 7.  [RESTRICTIONS.] (a) No person under the age of 18 
  6.32  years may play any game at the casino or win a prize from any 
  6.33  game at the casino. 
  6.34     (b) No person may be admitted to the casino who does not 
  6.35  possess a valid ticket issued in the person's name by an airline 
  6.36  making regularly scheduled flights in and out of the airport, 
  7.1   for a flight with a departure time not more than 12 hours after 
  7.2   admission to the casino, or for a flight that has arrived not 
  7.3   more than 12 hours before admission to the casino. 
  7.4      Sec. 7.  Minnesota Statutes 2002, section 541.20, is 
  7.5   amended to read: 
  7.6      541.20 [RECOVERY OF MONEY LOST.] 
  7.7      Every person who, by playing at cards, dice, or other game, 
  7.8   or by betting on the hands or sides of such as are gambling, 
  7.9   shall lose to any person so playing or betting any sum of money 
  7.10  or any goods, and pays or delivers the same, or any part 
  7.11  thereof, to the winner, may sue for and recover such money by a 
  7.12  civil action, before any court of competent jurisdiction.  For 
  7.13  purposes of this section, gambling shall not include pari-mutuel 
  7.14  wagering conducted under a license issued pursuant to chapter 
  7.15  240, purchase or sale of tickets in the state 
  7.16  lottery, participation in gambling at the casino authorized 
  7.17  under section 349A.17, or gambling authorized under chapters 349 
  7.18  and 349A. 
  7.19     Sec. 8.  Minnesota Statutes 2002, section 541.21, is 
  7.20  amended to read: 
  7.21     541.21 [COMMITMENTS FOR GAMBLING DEBT VOID.] 
  7.22     Every note, bill, bond, mortgage, or other security or 
  7.23  conveyance in which the whole or any part of the consideration 
  7.24  shall be for any money or goods won by gambling or playing at 
  7.25  cards, dice, or any other game whatever, or by betting on the 
  7.26  sides or hands of any person gambling, or for reimbursing or 
  7.27  repaying any money knowingly lent or advanced at the time and 
  7.28  place of such gambling or betting, or lent and advanced for any 
  7.29  gambling or betting to any persons so gambling or betting, shall 
  7.30  be void and of no effect as between the parties to the same, and 
  7.31  as to all persons except such as hold or claim under them in 
  7.32  good faith, without notice of the illegality of the 
  7.33  consideration of such contract or conveyance.  The provisions of 
  7.34  this section shall not apply to:  (1) pari-mutuel wagering 
  7.35  conducted under a license issued pursuant to chapter 240; (2) 
  7.36  purchase of tickets in the state lottery and casino gambling 
  8.1   activities under chapter 349A; (3) gaming activities conducted 
  8.2   pursuant to the Indian Gaming Regulatory Act, 25 U.S.C. 2701 et 
  8.3   seq.; or (4) lawful gambling activities permitted under chapter 
  8.4   349. 
  8.5      Sec. 9.  Minnesota Statutes 2002, section 609.75, 
  8.6   subdivision 3, is amended to read: 
  8.7      Subd. 3.  [WHAT ARE NOT BETS.] The following are not bets: 
  8.8      (1) A contract to insure, indemnify, guarantee or otherwise 
  8.9   compensate another for a harm or loss sustained, even though the 
  8.10  loss depends upon chance. 
  8.11     (2) A contract for the purchase or sale at a future date of 
  8.12  securities or other commodities. 
  8.13     (3) Offers of purses, prizes or premiums to the actual 
  8.14  contestants in any bona fide contest for the determination of 
  8.15  skill, speed, strength, endurance, or quality or to the bona 
  8.16  fide owners of animals or other property entered in such a 
  8.17  contest. 
  8.18     (4) The game of bingo when conducted in compliance with 
  8.19  sections 349.11 to 349.23. 
  8.20     (5) A private social bet not part of or incidental to 
  8.21  organized, commercialized, or systematic gambling. 
  8.22     (6) The operation of equipment or the conduct of a raffle 
  8.23  under sections 349.11 to 349.22, by an organization licensed by 
  8.24  the gambling control board or an organization exempt from 
  8.25  licensing under section 349.166.  
  8.26     (7) Pari-mutuel betting on horse racing when the betting is 
  8.27  conducted under chapter 240.  
  8.28     (8) The purchase and sale of state lottery tickets and 
  8.29  participation in the state-operated casino under chapter 349A.  
  8.30     Sec. 10.  Minnesota Statutes 2002, section 609.761, 
  8.31  subdivision 2, is amended to read: 
  8.32     Subd. 2.  [STATE LOTTERY.] Sections 609.755 and 609.76 do 
  8.33  not prohibit the operation of the state lottery or the sale, 
  8.34  possession, or purchase of tickets for the state lottery or 
  8.35  casino gambling activities under chapter 349A.  
  8.36     Sec. 11.  [APPROPRIATION.] 
  9.1      $......., or so much thereof as the director determines is 
  9.2   needed, is appropriated from the general fund to the director of 
  9.3   the Minnesota state lottery for capital, acquisition, and 
  9.4   initial operating costs of the casino authorized under sections 
  9.5   1 to 10.  The director must repay this appropriation from the 
  9.6   state lottery fund, with interest at the average monthly rate on 
  9.7   invested treasurer's cash, not later than three months after the 
  9.8   first date of operation of the casino. 
  9.9      Sec. 12.  [EFFECTIVE DATE.] 
  9.10     Sections 1 to 11 are effective the day following final 
  9.11  enactment.