SF 2304

1st Engrossment - 83rd Legislature (2003 - 2004) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to gambling; authorizing additional 
  1.3             state-tribal compact negotiations; providing for the 
  1.4             operations and taxation of certain card clubs; 
  1.5             authorizing simulcasting; amending Minnesota Statutes 
  1.6             2002, sections 3.9221, subdivision 2; 240.13, 
  1.7             subdivision 6; 240.30, subdivisions 5, 8, by adding a 
  1.8             subdivision. 
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  [PURPOSE.] 
  1.11     The purpose of this act is to manage the natural growth in 
  1.12  gaming that is occurring in this state due to population growth 
  1.13  and other factors in a manner that will provide benefits to all 
  1.14  people of the state, while maintaining trust with the parties to 
  1.15  existing tribal-state gaming compacts entered into in 
  1.16  recognition of the sovereignty of the parties. 
  1.17     Sec. 2.  Minnesota Statutes 2002, section 3.9221, 
  1.18  subdivision 2, is amended to read: 
  1.19     Subd. 2.  [NEGOTIATIONS AUTHORIZED.] (a) The governor or 
  1.20  the governor's designated representatives shall, pursuant to 
  1.21  section 11 of the act, negotiate in good faith a tribal-state 
  1.22  compact regulating the conduct of class III gambling, as defined 
  1.23  in section 4 of the act, on Indian lands of a tribe requesting 
  1.24  negotiations.  
  1.25     (b) In addition to the compacts negotiated under paragraph 
  1.26  (a), the governor or the governor's designated representatives 
  1.27  shall, pursuant to section 11 of the act, negotiate in good 
  2.1   faith identical state-tribal compacts with all Indian tribes 
  2.2   that request negotiations under this paragraph.  The additional 
  2.3   compacts are to regulate the conduct of class III gambling, as 
  2.4   defined in section 4 of the act, on land that has been acquired 
  2.5   for the purpose of being a site for an Indian gambling facility, 
  2.6   subject to the following requirements: 
  2.7      (1) the compacts must demonstrate respect for tribal 
  2.8   sovereignty and must not seek to renegotiate existing compacts; 
  2.9      (2) the facility and the gaming to be conducted there must 
  2.10  be operated in a manner that keeps gaming within its current 
  2.11  contours; 
  2.12     (3) the governor or the governor's designee must negotiate 
  2.13  compacts that provide that at least 20 percent and not more than 
  2.14  50 percent of the adjusted gross revenues from operation of the 
  2.15  facility must be remitted to the state in order to capture the 
  2.16  growth in gaming revenue attributable to the new facility to be 
  2.17  used for the benefit of all people of Minnesota and tribal 
  2.18  nations that are parties to the compact; 
  2.19     (4) the compacts must have a termination date no later than 
  2.20  20 years after the date of their inception, provided that they 
  2.21  may be renewed under the same terms or revised terms, which must 
  2.22  be the same for all compacts, for additional periods not to 
  2.23  exceed 20 years with the consent of both parties to each 
  2.24  compact; 
  2.25     (5) the tribes and the governor are encouraged to make 
  2.26  efforts to obtain a determination by the United States Secretary 
  2.27  of the Interior that a gaming establishment on newly acquired 
  2.28  land located in the metropolitan area as defined in section 
  2.29  473.121, subdivision 2, would be in the best interest of the 
  2.30  Indian tribes that enter into compacts under this paragraph and 
  2.31  their members and would not be detrimental to the surrounding 
  2.32  community; 
  2.33     (6) if the land on which the facility is to be located is 
  2.34  not acquired in trust, the compacts may not include any term 
  2.35  that would provide a tax exemption for the property or for any 
  2.36  transactions occurring there that would otherwise be subject to 
  3.1   taxation; and 
  3.2      (7) compacts negotiated under this paragraph are not 
  3.3   effective until at least nine tribal governments of reservations 
  3.4   located in Minnesota have entered into identical compacts under 
  3.5   this section.  Negotiations for all such compacts must be 
  3.6   concluded by December 31, 2004. 
  3.7      (c) The agreement may include any provision authorized 
  3.8   under section 11(d)(3)(C) of the act.  The attorney general is 
  3.9   the legal counsel for the governor or the governor's 
  3.10  representatives in regard to negotiating a compact under this 
  3.11  section.  If the governor appoints designees to negotiate under 
  3.12  this subdivision, the designees must include at least two 
  3.13  members of the senate and two members of the house of 
  3.14  representatives, two of whom must be the chairs of the senate 
  3.15  and house of representatives standing committees with 
  3.16  jurisdiction over gambling policy. 
  3.17     Sec. 3.  Minnesota Statutes 2002, section 240.13, 
  3.18  subdivision 6, is amended to read: 
  3.19     Subd. 6.  [SIMULCASTING.] (a) The commission may permit an 
  3.20  authorized licensee to conduct simulcasting at the licensee's 
  3.21  facility on any day authorized by the commission.  All 
  3.22  simulcasts must comply with the Interstate Horse Racing Act of 
  3.23  1978, United States Code, title 15, sections 3001 to 3007.  
  3.24     (b) The commission may not authorize any day for 
  3.25  simulcasting at a class A facility during the racing season, and 
  3.26  a licensee may not be allowed to transmit out-of-state telecasts 
  3.27  of races the licensee conducts, unless the licensee has obtained 
  3.28  the approval of the horsepersons' organization representing the 
  3.29  majority of the horsepersons racing the breed involved at the 
  3.30  licensed racetrack during the preceding 12 months.  In the case 
  3.31  of a class A facility at which the class A license has been in 
  3.32  effect for less than 12 months, the approval must be obtained 
  3.33  from the horsepersons' organization that represents the majority 
  3.34  of the horsepersons who are racing or who will race the breed at 
  3.35  the facility. 
  3.36     (c) The licensee may pay fees and costs to an entity 
  4.1   transmitting a telecast of a race to the licensee for purposes 
  4.2   of conducting pari-mutuel wagering on the race.  The licensee 
  4.3   may deduct fees and costs related to the receipt of televised 
  4.4   transmissions from a pari-mutuel pool on the televised race, 
  4.5   provided that one-half of any amount recouped in this manner 
  4.6   must be added to the amounts required to be set aside for purses.
  4.7      (d) With the approval of the commission and subject to the 
  4.8   provisions of this subdivision, a licensee may transmit 
  4.9   telecasts of races it conducts, for wagering purposes, to 
  4.10  locations outside the state, and the commission may allow this 
  4.11  to be done on a commingled pool basis.  
  4.12     (e) Except as otherwise provided in this section, 
  4.13  simulcasting may be conducted on a separate pool basis or, with 
  4.14  the approval of the commission, on a commingled pool basis.  All 
  4.15  provisions of law governing pari-mutuel betting apply to 
  4.16  simulcasting except as otherwise provided in this subdivision or 
  4.17  in the commission's rules.  If pools are commingled, wagering at 
  4.18  the licensed facility must be on equipment electronically linked 
  4.19  with the equipment at the licensee's class A facility or with 
  4.20  the sending racetrack via the totalizator computer at the 
  4.21  licensee's class A facility.  Subject to the approval of the 
  4.22  commission, the types of betting, takeout, and distribution of 
  4.23  winnings on commingled pari-mutuel pools are those in effect at 
  4.24  the sending racetrack.  Breakage for pari-mutuel pools on a 
  4.25  televised race must be calculated in accordance with the law or 
  4.26  rules governing the sending racetrack for these pools, and must 
  4.27  be distributed in a manner agreed to between the licensee and 
  4.28  the sending racetrack.  Notwithstanding subdivision 7 and 
  4.29  section 240.15, subdivision 5, the commission may approve 
  4.30  procedures governing the definition and disposition of unclaimed 
  4.31  tickets that are consistent with the law and rules governing 
  4.32  unclaimed tickets at the sending racetrack.  For the purposes of 
  4.33  this section, "sending racetrack" is either the racetrack 
  4.34  outside of this state where the horse race is conducted or, with 
  4.35  the consent of the racetrack, an alternative facility that 
  4.36  serves as the racetrack for the purpose of commingling pools.  
  5.1      (f) If there is more than one class B licensee conducting 
  5.2   racing within the seven-county metropolitan area, simulcasting 
  5.3   may be conducted only on races run by a breed that ran at the 
  5.4   licensee's class A facility within the 12 months preceding the 
  5.5   event.  
  5.6      Sec. 4.  Minnesota Statutes 2002, section 240.30, 
  5.7   subdivision 5, is amended to read: 
  5.8      Subd. 5.  [LIMITATION.] Except in the case of a licensee 
  5.9   who has held a class B license for less than 12 months, the 
  5.10  commission shall not authorize a licensee to operate a card club 
  5.11  unless the licensee has conducted at least 50 days of live 
  5.12  racing at a class A facility within the past 12 months or during 
  5.13  the preceding calendar year.  In the case of a licensee who has 
  5.14  held a class B license for less than 12 months, the commission 
  5.15  shall not authorize the licensee to operate a card club unless 
  5.16  the licensee has been granted at least 50 racing days by the 
  5.17  commission in the year in which the card club begins operations. 
  5.18     Sec. 5.  Minnesota Statutes 2002, section 240.30, 
  5.19  subdivision 8, is amended to read: 
  5.20     Subd. 8.  [LIMITATIONS.] The commission may not approve any 
  5.21  plan of operation under subdivision 6 that exceeds any of the 
  5.22  following limitations: 
  5.23     (1) the maximum number of tables used for card playing at 
  5.24  the card club at any one time, other than tables used for 
  5.25  instruction, demonstrations, or tournament play, may not exceed 
  5.26  50 100.  The table limit exception for tournament play is 
  5.27  allowed for only one tournament per year that lasts for no 
  5.28  longer than 14 days; 
  5.29     (2) except as provided in clause (3), no wager may exceed 
  5.30  $60; 
  5.31     (3) for games in which each player is allowed to make only 
  5.32  one wager or has a limited opportunity to change that wager, no 
  5.33  wager may exceed $300. 
  5.34     Sec. 6.  Minnesota Statutes 2002, section 240.30, is 
  5.35  amended by adding a subdivision to read: 
  5.36     Subd. 11.  [FRANCHISE FEE.] As a condition of operating a 
  6.1   card club under this section, the licensee must pay a fee to the 
  6.2   commission equal to 6.5 percent of the gross revenues, less any 
  6.3   refunds, for charges imposed under subdivision 4.  Payment, 
  6.4   collection, and administration of the fee must be made in the 
  6.5   same manner and under the terms provided under section 240.15 
  6.6   for the tax on pari-mutuel pools.  The commission shall deposit 
  6.7   all of the revenues from the fee in the state treasury and 
  6.8   amounts deposited must be credited to the general fund.  The 
  6.9   amount of the fee under this subdivision does not reduce the 
  6.10  obligation to set aside revenues from the card club under 
  6.11  section 240.135. 
  6.12     [EFFECTIVE DATE.] This section is effective for charges and 
  6.13  revenues received after June 30, 2004. 
  6.14     Sec. 7.  [COMMISSIONER OF REVENUE; STUDY OF GAMBLING 
  6.15  TAXATION.] 
  6.16     The commissioner of revenue shall study the taxation of all 
  6.17  forms of gambling in Minnesota.  In conducting the study the 
  6.18  commissioner shall consider: 
  6.19     (1) revenue received by all types of gambling operations in 
  6.20  the state and amounts received for each type; 
  6.21     (2) current uses of such revenue; 
  6.22     (3) existing taxes paid on gambling operations; and 
  6.23     (4) taxation of gambling in other states. 
  6.24     The commissioner shall report on the study to the chairs of 
  6.25  the legislative committees having jurisdiction over taxation and 
  6.26  gambling policy by January 15, 2005.  The report must contain 
  6.27  the commissioner's recommendations for a fair and equitable tax 
  6.28  system for gambling revenues.