"Active member" means a member who has paid all dues to the organization, who is 18 years of age or older, who has equal voting rights with all other members, who has equal opportunity to be an elected officer, who has equal right and responsibilities of attendance at the regularly scheduled meetings of the organization, whose name and membership origination date appear with the member's knowledge and consent on a list of members of the organization, and who has been a member of the organization for at least six months.
"Affiliate" is any person or entity directly or indirectly controlling, controlled by, or under common control or ownership with a licensee of the board or any officer or director of a licensee of the board.
"Allowable expense" means the percentage of the total cost incurred by the organization in the purchase of any good, service, or other item which corresponds to the proportion of the total actual use of the good, service, or other item that is directly related to conduct of lawful gambling. Allowable expense includes the advertising of the conduct of lawful gambling, provided that the amount expended does not exceed five percent of the annual gross profits of the organization or $5,000 per year per organization, whichever is less. The board may adopt rules to regulate the content of the advertising to ensure that the content is consistent with the public welfare.
"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.
"Bar bingo" is a bingo occasion conducted at a permitted premises in an area where intoxicating liquor or 3.2 percent malt beverages are sold and where the licensed organization conducts another form of lawful gambling.
"Bingo" means a game where each player has a bingo hard card, bingo paper sheet, or facsimile of a bingo paper sheet when used in conjunction with an electronic bingo device, 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.
"Bingo occasion" means a single gathering or session at which a series of one or more successive bingo games is played. There is no limit on the number of games conducted during a bingo occasion but a bingo occasion must not last longer than eight consecutive hours.
"Board" is the Gambling Control Board.
"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.
"Capital assets" means property, real or personal, except gambling equipment, with an expected useful life of at least one year.
"Charitable contribution" means one or more of the lawful purposes expenditures under section 349.12, subdivision 25, paragraph (a), clauses (1) to (7), (10), (11), (13) to (15), and (19).
"Checker" means a person who records the number of bingo hard cards purchased and played during each game and records the prizes awarded to the recorded hard cards, but does not collect the payment for the hard cards.
"Deal" means each separate package, or series of packages, consisting of one game of pull-tabs or tipboards with the same serial number.
"Director" is the director of the Gambling Control Board.
"Distributor" is a person who sells gambling equipment for use within the state to licensed organizations, or to organizations conducting excluded or exempt activities under section 349.166.
"Distributor salesperson" means a person who in any manner receives orders for gambling equipment or who solicits a licensed, exempt, or excluded organization to purchase gambling equipment from a licensed distributor.
"Electronic bingo device" means an electronic device used by a bingo player to monitor bingo paper sheets or facsimile of a bingo paper sheet when purchased at the time and place of an organization's bingo occasion and which (1) provides a means for bingo players to input numbers announced by a bingo caller; (2) compares the numbers entered by the player to the bingo faces previously stored in the memory of the device; and (3) identifies a winning bingo pattern.
Electronic bingo device does not mean any device into which coin, currency, or tokens are inserted to activate play.
"Face value" means the price per ticket printed on the ticket or the flare.
"501(c)(3) organization" is an organization exempt from the payment of federal income taxes under section 501(c)(3) of the Internal Revenue Code.
"Festival organization" is an organization conducting a community festival that is exempt from the payment of federal income taxes under section 501(c)(4) of the Internal Revenue Code.
"Flare" is the posted display, with registration stamp affixed or bar code imprinted or affixed, that sets forth the rules of a particular game of pull-tabs or tipboards and that is associated with a specific deal of pull-tabs or grouping of tipboards.
"Fraternal organization" means a nonprofit organization which is a branch, lodge, or chapter of a national or state organization registered by the Internal Revenue Service as a 501(c)8 or a 501(c)10 nonprofit organization and exists for the common business, fraternal, or other interests of its members. The term does not include college and high school fraternities and sororities.
"Free play" means a winning ticket that is labeled as a free play or its equivalent.
"Gambling equipment" means: bingo hard cards or paper sheets, linked bingo paper sheets, devices for selecting bingo numbers, electronic bingo devices, pull-tabs, jar tickets, paddle wheels, paddle wheel tables, paddle tickets, paddle ticket cards, tipboards, tipboard tickets, promotional tickets that mimic a pull-tab or tipboard, and pull-tab dispensing devices.
"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;
(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.
"Gross profit" means the gross receipts collected from lawful gambling, less reasonable sums necessarily and actually expended for prizes.
"Gross receipts" means all receipts derived from lawful gambling activity including, but not limited to, the following items:
(1) gross sales of bingo hard cards, paper sheets, facsimiles of bingo paper sheets when used in conjunction with an electronic bingo device, and rental of electronic bingo devices before reduction for prizes, expenses, shortages, free plays, or any other charges or offsets;
(2) the ideal gross of pull-tab and tipboard deals or games less the value of unsold and defective tickets and before reduction for prizes, expenses, shortages, free plays, or any other charges or offsets;
(3) gross sales of raffle tickets and paddle tickets before reduction for prizes, expenses, shortages, free plays, or any other charges or offsets;
(4) admission, commission, cover, or other charges imposed on participants in lawful gambling activity as a condition for or cost of participation; and
(5) interest, dividends, annuities, profit from transactions, or other income derived from the accumulation or use of gambling proceeds.
Gross receipts does not include proceeds from rental under section 349.18, subdivision 3.
"Ideal gross" means the total amount of receipts that would be received if every individual ticket in the pull-tab or tipboard deal was sold at its face value. In the calculation of ideal gross and prizes, a free play ticket shall be valued at face value.
"Ideal net" means the pull-tab or tipboard deal's ideal gross, as defined under subdivision 22, less the total predetermined prize amounts available to be paid out. When the prize is not entirely a monetary one, the ideal net is 50 percent of the ideal gross.
"Lawful gambling" is the operation, conduct or sale of bingo, raffles, paddle wheels, tipboards, and pull-tabs.
(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 or expenditure for goods and services for an individual or family suffering from poverty, homelessness, or disability, which is used to relieve the effects of that suffering;
(3) a contribution to a program recognized by the Minnesota Department of Human Services for the education, prevention, or treatment of problem 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 an individual, public or private nonprofit educational institution registered with or accredited by this state or any other state, or to a scholarship fund of a nonprofit organization whose primary mission is to award scholarships, 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 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 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;
(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 diem; or
(iv) active military personnel and their immediate family members in need of support services;
(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 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;
(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 and paid prior to June 30, 2006;
(13) a contribution to or expenditure on projects or activities approved by the commissioner of natural resources for:
(i) wildlife management projects that benefit the public at large;
(iii) supplies and materials for safety training and educational programs coordinated by the Department of Natural Resources, including the Enforcement Division;
(14) conducting nutritional programs, food shelves, and congregate dining programs primarily for persons who are age 62 or older or disabled;
(15) 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;
(16) an expenditure by a licensed fraternal organization or a licensed veterans organization for payment of water, fuel for heating, electricity, and sewer costs for a building wholly owned or wholly leased by and used as the primary headquarters of the licensed veterans organization or fraternal organization;
(17) 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;
(18) payment of fees authorized under this chapter imposed by the state of Minnesota to conduct lawful gambling in Minnesota; or
(19) a contribution or expenditure to honor an individual's humanitarian service as demonstrated through philanthropy or volunteerism to the United States, this state, or local community.
(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 catastrophe, 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.
"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.
"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.
"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.
"Linked bingo prize pool" means the total of all prize money that each participating organization has contributed to a linked bingo game prize and includes any portion of the prize pool that is carried over from one occasion to another in a progressive linked bingo game.
"Manufacturer" means a person or entity who assembles from raw materials or subparts a completed piece of gambling equipment, and who sells or furnishes the equipment for resale or for use in the state. The term includes a person who converts, modifies, adds to, or removes parts or a portion from an item, device, or assembly to further its promotion, sale, or use as gambling equipment in this state. A person only adding or modifying promotional flares to advise the public of the prizes available, the rules of play, and the consideration required is not a manufacturer.
"Master flare" is the posted display, with registration stamp affixed or bar code imprinted or affixed, that is used in conjunction with sealed groupings of 100 or fewer sequentially numbered paddle ticket cards.
"Net profit" means gross profit less reasonable sums actually expended for allowable expenses.
"Organization" means any fraternal, religious, veterans, or other nonprofit organization.
"Paddle ticket" means a preprinted ticket that can be used to place wagers on the spin of a paddle wheel.
"Paddle ticket card" means a card to which detachable paddle tickets are attached.
"Paddle ticket card number" means the unique serial number preprinted by the manufacturer on the stub of a paddle ticket card and the paddle tickets attached to the card.
"Paddle wheel" means a wheel marked off into sections containing one or more numbers, and which, after being turned or spun, uses a pointer or marker to indicate winning chances.
"Person" is an individual, organization, firm, association, partnership, limited liability company, corporation, trustee, or legal representative.
"Profit carryover" means cumulative net profit less cumulative lawful purpose expenditures.
A pull-tab or tipboard ticket created and printed by a licensed manufacturer with the words "no purchase necessary" and "for promotional use only" and for which no consideration is given is a promotional ticket.
"Pull-tab" means a single folded or banded ticket or a multi-ply card with perforated break-open tabs, the face of which is initially covered to conceal one or more numbers or symbols, where one or more of each set of tickets or cards has been designated in advance as a winner.
"Pull-tab dispensing device" means a mechanical device that dispenses paper pull-tabs and has no additional function as an amusement or gambling device.
"Raffle" means a game in which a participant buys a ticket or other certificate of participation in an event where the prize determination is based on a method of random selection and all entries have an equal chance of selection. The ticket or certificate of participation must include the location, date, and time of the selection of the winning entries.
"Tipboard" means a board, placard or other device containing a seal that conceals the winning number or symbol, and that serves as the game flare for a tipboard game.
"Tipboard ticket" is a single folded or banded ticket, or multi-ply card, the face of which is initially covered or otherwise hidden from view to conceal a number, symbol, or set of symbols, some of which have been designated in advance and at random as prize winners.
"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.
"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.
"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.
1976 c 261 s 2; 1984 c 502 art 12 s 3; 1986 c 444; 1986 c 467 s 4-6; 1987 c 327 s 2-5; 1988 c 596 s 1; 1988 c 719 art 9 s 1-3; 1989 c 203 s 1; 1989 c 334 art 2 s 2-15,51; 1Sp1989 c 1 art 13 s 1-6; 1990 c 590 art 1 s 4-9; 1991 c 199 art 2 s 1; 1991 c 233 s 100; 1991 c 336 art 2 s 10-12; 1993 c 244 art 5 s 1; 1994 c 633 art 2 s 19; art 5 s 1-20; 1995 c 186 s 68; 1995 c 261 s 20,21; 1995 c 264 art 9 s 9; 1997 c 155 s 2,3; 1998 c 322 s 1; 2000 c 300 s 1,2; 2000 c 336 s 3; 2001 c 96 s 6; 2002 c 377 art 12 s 14; 2002 c 386 art 3 s 1; 2003 c 110 s 1-13; 1Sp2003 c 1 art 2 s 84,85; 2005 c 146 s 50; 2005 c 166 art 1 s 1-6; 2006 c 205 s 2-6; 2006 c 212 art 3 s 31; 2007 c 145 s 1-3; 2008 c 260 s 1,2
Official Publication of the State of Minnesota
Revisor of Statutes