1.1                          A bill for an act 
  1.2             relating to lotteries; authorizing the city of St. 
  1.3             Paul to conduct lottery games for certain educational 
  1.4             and recreational purposes; amending Minnesota Statutes 
  1.5             1996, section 349A.10, subdivisions 3 and 5; proposing 
  1.6             coding for new law in Minnesota Statutes, chapter 349A.
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  [349A.091] [LOTTERY GAME; CITY OF ST. PAUL.] 
  1.9      Subdivision 1.  [SPECIAL GAME AUTHORIZED.] The director 
  1.10  shall conduct one or more lottery games for the benefit of youth 
  1.11  programs in the city of St. Paul, as provided in this section.  
  1.12  The director shall consult with the mayor of St. Paul or the 
  1.13  mayor's designee concerning the designs of each game.  The 
  1.14  director shall design each game in such a manner as to prevent 
  1.15  to the greatest extent practicable competition with other 
  1.16  lottery games the director conducts.  Games conducted under this 
  1.17  section must be of a type whereby purchasers of tickets are able 
  1.18  to determine immediately if they have won a prize in the game. 
  1.19     Subd. 2.  [PRIZES.] The percentage of total ticket sales 
  1.20  for games conducted under this section that are paid out in 
  1.21  prizes in a fiscal year may not be more than the average 
  1.22  percentage for all other games the director conducts in the same 
  1.23  fiscal year for games of the same type. 
  1.24     Subd. 3.  [SALE OF TICKETS.] Tickets for games conducted 
  1.25  under this section may be sold only by lottery retailers and may 
  1.26  be sold only at locations within the city of St. Paul.  The 
  2.1   director shall require all lottery retailers who sell tickets 
  2.2   for these games to report gross receipts from the games in a 
  2.3   manner that enables the director to readily separate gross 
  2.4   receipts from these games from gross receipts from the sale of 
  2.5   all other tickets.  The director shall establish a separate 
  2.6   account in the state lottery fund and place all gross receipts 
  2.7   from the sale of tickets for games conducted under this section 
  2.8   in the account. 
  2.9      Sec. 2.  Minnesota Statutes 1996, section 349A.10, 
  2.10  subdivision 3, is amended to read: 
  2.11     Subd. 3.  [LOTTERY OPERATIONS.] (a) The director shall 
  2.12  establish a lottery operations account in the lottery fund.  The 
  2.13  director shall pay all costs of operating the lottery, including 
  2.14  payroll costs or amounts transferred to the state treasury for 
  2.15  payroll costs, but not including lottery prizes, from the 
  2.16  lottery operating account.  The director shall credit to the 
  2.17  lottery operations account amounts sufficient to pay the 
  2.18  operating costs of the lottery. 
  2.19     (b) The director may not credit in fiscal year 1993 amounts 
  2.20  to the lottery operations account which when totaled exceed 14.5 
  2.21  percent of gross revenue to the lottery fund.  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:  (1) amounts 
  2.27  transferred to or retained by lottery retailers as sales 
  2.28  commissions or other compensation; and (2) amounts necessary for 
  2.29  the costs of operating lottery games conducted under section 
  2.30  349A.091. 
  2.31     (c) The director of the lottery may not expend after July 
  2.32  1, 1991, more than 2-3/4 percent of gross revenues in a fiscal 
  2.33  year for contracts for the preparation, publication, and 
  2.34  placement of advertising. 
  2.35     (d) Except as the director determines, the lottery is not 
  2.36  subject to chapter 16A relating to budgeting, payroll, and the 
  3.1   purchase of goods and services. 
  3.2      Sec. 3.  Minnesota Statutes 1996, section 349A.10, 
  3.3   subdivision 5, is amended to read: 
  3.4      Subd. 5.  [DEPOSIT OF NET PROCEEDS.] Within 30 days after 
  3.5   the end of each month, the director shall deposit in the state 
  3.6   treasury the net proceeds of the lottery, which is the balance 
  3.7   in the lottery fund after transfers to the lottery prize fund 
  3.8   and credits to the lottery operations account.  Of the net 
  3.9   proceeds, 40 percent must be credited to the Minnesota 
  3.10  environment and natural resources trust fund, and the remainder 
  3.11  must be credited to the special revenue fund created in section 
  3.12  16A.67, subdivision 3.  Money credited to the special revenue 
  3.13  fund must be transferred to the debt service fund established in 
  3.14  section 16A.67, subdivision 4, at the times and in the amounts 
  3.15  determined by the commissioner of finance to be necessary to 
  3.16  provide for the payment and security of bonds issued pursuant to 
  3.17  section 16A.67.  On or before the tenth day of each month, any 
  3.18  money in the special revenue fund not required to be transferred 
  3.19  to the debt service fund must be transferred to the general 
  3.20  fund.  The amounts credited to the general fund from the net 
  3.21  proceeds of games conducted under section 349A.091 must be paid 
  3.22  by the commissioner of finance to the city of St. Paul. 
  3.23     Sec. 4.  [ST. PAUL; USE OF LOTTERY REVENUES.] 
  3.24     The city of St. Paul must spend all money paid to it from 
  3.25  proceeds from lottery games conducted under Minnesota Statutes, 
  3.26  section 349A.091, solely for the operation and management of 
  3.27  programs for the education and recreation of persons under the 
  3.28  age of 18 who reside in the city.  The city must spend this 
  3.29  money according to the recommendations of the youth programs 
  3.30  fund advisory board established in the city.  In making these 
  3.31  spending decisions, first priority must be given to programs 
  3.32  that would increase participation in recreational activities by 
  3.33  females under age 18; and programs that serve racial minorities, 
  3.34  the disabled, and other underrepresented youth groups with the 
  3.35  ultimate goal of achieving a balance of city expenditures 
  3.36  between those programs and others that do not serve these 
  4.1   groups.  The city may spend funds under this section only to 
  4.2   initiate or expand programs that meet the purposes of this 
  4.3   section, and may not use the funds to replace existing funding 
  4.4   for these programs.  The city must, by January 1 of each year, 
  4.5   report to the legislature on its progress in meeting the goals 
  4.6   established in this section.