1.1                          A bill for an act 
  1.2             relating to lawful gambling; providing limits on rent 
  1.3             paid for premises used for lawful gambling; 
  1.4             prohibiting organizations conducting lawful gambling 
  1.5             from employing certain persons in the sale of 
  1.6             pull-tabs; amending Minnesota Statutes 2000, sections 
  1.7             349.168, by adding a subdivision; 349.18, subdivision 
  1.8             1.  
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  Minnesota Statutes 2000, section 349.168, is 
  1.11  amended by adding a subdivision to read: 
  1.12     Subd. 10.  [EMPLOYMENT OF CERTAIN PERSONS.] An organization 
  1.13  that sells pull-tabs on leased premises within a booth or 
  1.14  similar enclosure may not employ as a seller of pull-tabs the 
  1.15  lessor of those premises or a person who is employed by the 
  1.16  lessor of those premises. 
  1.17     Sec. 2.  Minnesota Statutes 2000, section 349.18, 
  1.18  subdivision 1, is amended to read: 
  1.19     Subdivision 1.  [LEASE OR OWNERSHIP REQUIRED.] (a) An 
  1.20  organization may conduct lawful gambling only on premises it 
  1.21  owns or leases.  Leases must be on a form prescribed by the 
  1.22  board.  Except for leases entered into before August 1, 1994, 
  1.23  the term of the lease may not begin before the effective date of 
  1.24  the premises permit and must expire on the same day that the 
  1.25  premises permit expires.  Copies of all leases must be made 
  1.26  available to employees of the board and the division of alcohol 
  1.27  and gambling enforcement on request.  A lease may not provide 
  2.1   for payments determined directly or indirectly by the receipts 
  2.2   or profits from lawful gambling.  The board may prescribe by 
  2.3   rule limits on the amount of rent which an organization may pay 
  2.4   to a lessor for premises leased for lawful gambling provided 
  2.5   that no rule of the board may prescribe a limit of less than 
  2.6   $1,000 per month on rent paid for premises used for lawful 
  2.7   gambling other than bingo.  Any rule adopted by the board 
  2.8   limiting the amount of rent to be paid may only be effective for 
  2.9   leases entered into, or renewed, after the effective date of the 
  2.10  rule. 
  2.11     (b) No person, distributor, manufacturer, lessor, or 
  2.12  organization other than the licensed organization leasing the 
  2.13  space may conduct any activity other than the sale or serving of 
  2.14  food and beverages on the leased premises during times when 
  2.15  lawful gambling is being conducted on the premises. 
  2.16     (c) At a site where the leased premises consists of an area 
  2.17  on or behind a bar at which alcoholic beverages are sold and 
  2.18  employees of the lessor are employed by the organization as 
  2.19  pull-tab sellers at the site, pull-tabs and tipboard tickets may 
  2.20  be sold and redeemed by those employees at any place on or 
  2.21  behind the bar, but the tipboards and receptacles for pull-tabs 
  2.22  and cash drawers for lawful gambling receipts must be maintained 
  2.23  only within the leased premises. 
  2.24     (d) Employees of a lessor may participate in lawful 
  2.25  gambling on the premises provided (1) if pull-tabs or tipboards 
  2.26  are sold, the organization voluntarily posts, or is required to 
  2.27  post, the major prizes as specified in section 349.172; and (2) 
  2.28  any employee of the lessor participating in lawful gambling is 
  2.29  not a gambling employee for the organization conducting lawful 
  2.30  gambling on the premises. 
  2.31     (e) A gambling employee may purchase pull-tabs at the site 
  2.32  of the employee's place of employment provided: 
  2.33     (1) the organization voluntarily posts, or is required to 
  2.34  post, the major prizes for pull-tab or tipboard games as 
  2.35  specified in section 349.172; and 
  2.36     (2) the employee is not involved in the sale of pull-tabs 
  3.1   at that site. 
  3.2      (f) At a leased site where an organization uses a 
  3.3   paddlewheel consisting of 30 numbers or less or a tipboard 
  3.4   consisting of 30 tickets or less, tickets may be sold throughout 
  3.5   the permitted premises, but winning tickets must be redeemed, 
  3.6   the paddlewheel must be located, and the tipboard seal must be 
  3.7   opened within the leased premises. 
  3.8      (g) Rent paid by an organization for premises leased for 
  3.9   lawful gambling may not exceed the following amounts: 
  3.10   Gross profit               Maximum rent per month
  3.11   Up to $500,000                    $  600
  3.12   $500,001 to $1,000,000            $1,000
  3.13   $1,000,001 to $2,000,000          $1,250
  3.14   Over $2,000,000                   $1,500
  3.15  For purposes of this paragraph, "gross profit" means gross 
  3.16  profit from lawful gambling at the premises for which the rent 
  3.17  is paid for the calendar year immediately preceding the year in 
  3.18  which the organization entered into the lease.  An organization 
  3.19  may not make payments to a lessor of premises used for lawful 
  3.20  gambling in excess of the rent limits provided in this paragraph.
  3.21     Sec. 3.  [EFFECTIVE DATE.] 
  3.22     Section 2 is effective August 1, 2002, and applies to all 
  3.23  leases entered into on and after that date.