1.1                          A bill for an act 
  1.2             relating to lawful gambling; regulating expenditures 
  1.3             of gross profits from lawful gambling; allowing 
  1.4             certain expenditures on items not directly related to 
  1.5             the conduct of lawful gambling; amending Minnesota 
  1.6             Statutes 1994, sections 349.12, subdivision 3a; and 
  1.7             349.15, subdivision 1. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1994, section 349.12, 
  1.10  subdivision 3a, is amended to read: 
  1.11     Subd. 3a.  [ALLOWABLE EXPENSE.] (a) "Allowable expense" 
  1.12  means the percentage of the total cost incurred by the 
  1.13  organization in the purchase of any good, service, or other item 
  1.14  which corresponds to the proportion of the total actual use of 
  1.15  the good, service, or other item that is directly related to 
  1.16  conduct of lawful gambling.  Allowable expense includes the 
  1.17  advertising of the conduct of lawful gambling, provided that the 
  1.18  amount expended does not exceed five percent of the annual gross 
  1.19  profits of the organization or $5,000 per year per organization, 
  1.20  whichever is less.  The board may adopt rules to regulate the 
  1.21  content of the advertising to ensure that the content is 
  1.22  consistent with the public welfare. 
  1.23     (b) "Allowable expense" includes expenditures on items not 
  1.24  directly related to the conduct of lawful gambling, subject to 
  1.25  the restrictions in section 349.15, subdivision 1. 
  1.26     Sec. 2.  Minnesota Statutes 1994, section 349.15, 
  2.1   subdivision 1, is amended to read: 
  2.2      Subdivision 1.  [EXPENDITURE RESTRICTIONS.] Gross profits 
  2.3   from lawful gambling may be expended only for lawful purposes or 
  2.4   allowable expenses as authorized by the membership of the 
  2.5   conducting organization at a monthly meeting of the 
  2.6   organization's membership.  Provided that no more than 60 
  2.7   percent of the gross profit less the tax imposed under section 
  2.8   297E.02, subdivision 1, from bingo, and no more than 50 percent 
  2.9   of the gross profit from other forms of lawful gambling, may be 
  2.10  expended for allowable expenses related to lawful gambling.  
  2.11     Allowable expense under section 349.12, subdivision 3a, 
  2.12  paragraph (b), may not exceed the difference between the 
  2.13  applicable maximum allowance percentage in this subdivision and 
  2.14  the percentage of allowable expense under section 349.12, 
  2.15  subdivision 3a, paragraph (a), up to a maximum of $15,000 per 
  2.16  year. 
  2.17     Sec. 3.  [EFFECTIVE DATE.] 
  2.18     Sections 1 and 2 are effective the day following final 
  2.19  enactment.