1.1                          A bill for an act 
  1.2             relating to gambling; authorizing counties to issue 
  1.3             licenses for the operation of a casino; proposing a 
  1.4             constitutional amendment permitting counties to 
  1.5             license and tax casinos; amending Minnesota Statutes 
  1.6             2000, sections 299L.07, subdivision 2a; 349.31, by 
  1.7             adding a subdivision; 541.21; 609.761, by adding a 
  1.8             subdivision; proposing coding for new law in Minnesota 
  1.9             Statutes, chapter 349. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 2000, section 299L.07, 
  1.12  subdivision 2a, is amended to read: 
  1.13     Subd. 2a.  [RESTRICTIONS.] (a) A manufacturer licensed 
  1.14  under this section may sell, offer to sell, lease, or rent, in 
  1.15  whole or in part, a gambling device only to a distributor 
  1.16  licensed under this section. 
  1.17     (b) A distributor licensed under this section may sell, 
  1.18  offer to sell, market, rent, lease, or otherwise provide, in 
  1.19  whole or in part, a gambling device only to: 
  1.20     (1) the governing body of a federally recognized Indian 
  1.21  tribe that is authorized to operate the gambling device under a 
  1.22  tribal state compact under the Indian Gaming Regulatory Act, 
  1.23  Public Law Number 100-497, and future amendments to it; 
  1.24     (2) a person for use in the person's dwelling for display 
  1.25  or amusement purposes in a manner that does not afford players 
  1.26  an opportunity to obtain anything of value; 
  1.27     (3) another distributor licensed under this section; or 
  2.1      (4) a person in another state who is authorized under the 
  2.2   laws of that state to possess the gambling device; or 
  2.3      (5) a casino licensed by a county under section 349.62. 
  2.4      Sec. 2.  Minnesota Statutes 2000, section 349.31, is 
  2.5   amended by adding a subdivision to read: 
  2.6      Subd. 3.  [CASINO OPERATION PERMITTED.] Sections 349.31 to 
  2.7   349.61 do not prohibit the operation of gambling devices at a 
  2.8   casino licensed by a county under section 349.62. 
  2.9      Sec. 3.  [349.62] [CASINO LICENSES ISSUED BY COUNTIES.] 
  2.10     Subdivision 1.  [CASINOS AUTHORIZED.] The county board of 
  2.11  any county may by ordinance provide for the issuance of one 
  2.12  license that permits the licensee to own and operate one casino 
  2.13  within the county.  For purposes of this section, "casino" means 
  2.14  a gambling facility where the game of blackjack may be conducted 
  2.15  and video gambling devices operated. 
  2.16     Subd. 2.  [LICENSE QUALIFICATIONS; INVESTIGATION.] (a) The 
  2.17  ordinance must provide that a casino license issued by the 
  2.18  county may not be issued to or held by a person who:  
  2.19     (1) is in default in the payment of an obligation or debt 
  2.20  to the state or a political subdivision; 
  2.21     (2) has a felony conviction of record in a state or federal 
  2.22  court and does not have a state or federal felony charge 
  2.23  pending; 
  2.24     (3) is or has been connected with or engaged in any illegal 
  2.25  business; 
  2.26     (4) has ever been found guilty of fraud or 
  2.27  misrepresentation in connection with any gambling activity; or 
  2.28     (5) has ever been found guilty of a violation of a law or 
  2.29  rule relating to gambling. 
  2.30     A county may not issue a license under this section to a 
  2.31  corporation, partnership, or association having an officer, 
  2.32  director, or other person holding directly, indirectly, or 
  2.33  beneficially an interest of any kind in the licensee or any of 
  2.34  its holding corporations, a person who would be disqualified 
  2.35  under clauses (1) to (5). 
  2.36     (b) The county shall conduct an investigation of each 
  3.1   applicant for a license under this section and shall charge each 
  3.2   applicant the reasonable costs of the investigation.  The 
  3.3   commissioner of public safety shall cooperate with the county in 
  3.4   investigating an applicant for a casino license, and may charge 
  3.5   the county for the reasonable costs therefor.  A county 
  3.6   investigating an applicant under this section has access to all 
  3.7   criminal history data relating to the applicant compiled by the 
  3.8   commissioner. 
  3.9      Subd. 3.  [HEARING.] Before granting a casino license, the 
  3.10  board shall conduct one or more public hearings in the city or 
  3.11  town where each applicant for the license proposes to operate a 
  3.12  casino.  If the casino proposed to be built is located in 
  3.13  unorganized territory, the hearing must be held at a location 
  3.14  within ten miles of the site of the proposed casino.  If the 
  3.15  proposed casino is to be located in a city or town, the board 
  3.16  shall also request comments on the application from the city 
  3.17  council or town board. 
  3.18     Subd. 4.  [LICENSE ISSUANCE.] If the board determines that 
  3.19  the license will not adversely affect the public health, 
  3.20  welfare, and safety, that the applicant's operation of the 
  3.21  casino will safeguard the integrity of gambling, and that the 
  3.22  applicant is financially able to operate a casino, it shall 
  3.23  issue a casino license to the applicant.  The license is 
  3.24  effective until revoked or suspended by the board or 
  3.25  relinquished by the licensee. 
  3.26     Subd. 5.  [LICENSE SUSPENSION AND REVOCATION.] An ordinance 
  3.27  under this section must provide that a license may be suspended 
  3.28  or revoked for a violation of law, ordinance, or order of the 
  3.29  board.  A license revocation or suspension is a contested case 
  3.30  under sections 14.57 to 14.69 of the Administrative Procedure 
  3.31  Act, and is in addition to criminal penalties imposed for a 
  3.32  violation of law or rule. 
  3.33     Sec. 4.  [349.63] [ORDINANCE REQUIREMENTS.] 
  3.34     Subdivision 1.  [OCCUPATIONAL LICENSING.] An ordinance 
  3.35  adopted under section 349.62 must specify occupations in the 
  3.36  casino that require licensing to protect the public health, 
  4.1   welfare, and safety, and the integrity of gambling, and require 
  4.2   that persons in such occupations hold a license from the 
  4.3   county.  The ordinance must provide qualifications for persons 
  4.4   applying for occupational licenses substantially similar to the 
  4.5   qualifications in section 349.62, subdivision 2.  The ordinance 
  4.6   must provide for the duration of occupational licenses and for 
  4.7   their revocation and suspension. 
  4.8      Subd. 2.  [GAME PROCEDURES.] An ordinance adopted under 
  4.9   section 349.62 must provide for: 
  4.10     (1) the game procedures and rules to be followed at the 
  4.11  casino, including minimum and maximum payout percentages; or 
  4.12     (2) the adoption and subsequent amendment by the licensee 
  4.13  of game procedures and rules to be followed by the licensee, 
  4.14  including minimum and maximum payout percentages, subject to the 
  4.15  approval of the board.  
  4.16  Approval by the board of new or amended game procedures and 
  4.17  rules must be by order of the board. 
  4.18     Subd. 3.  [SECURITY PLAN.] An ordinance adopted under 
  4.19  section 349.62 must require the licensee to adopt a security 
  4.20  plan for security and surveillance at the casino, subject to the 
  4.21  approval of the board.  Approval by the board of a new or 
  4.22  amended security plan must be by order of the board. 
  4.23     Subd. 4.  [EXCLUSIONS FROM CASINO.] An ordinance adopted 
  4.24  under section 349.62 may authorize the board to issue an order, 
  4.25  on the basis of evidence presented to it, finding that a person 
  4.26  named in the order is a threat to the public health, welfare, or 
  4.27  safety, or to the integrity of gambling, and prohibiting the 
  4.28  person named in the order from being on the premises of a casino 
  4.29  licensed by the county.  If the ordinance contains such a 
  4.30  provision, it must allow the person named in the order the right 
  4.31  to a public hearing at which the person may appeal the order. 
  4.32     Subd. 5.  [AUDIT.] An ordinance adopted under section 
  4.33  349.62 must provide for an annual audit of the finances of the 
  4.34  casino, to be performed by the county auditor or by an outside 
  4.35  auditor selected by the board. 
  4.36     Sec. 5.  [349.64] [TAX AUTHORIZED.] 
  5.1      Subdivision 1.  [DEFINITION.] For purposes of this section, 
  5.2   "gross casino gambling receipts" means all revenue received by a 
  5.3   casino as wagers on gambling activities, or as payment for chips 
  5.4   or tokens used in gambling activities at the casino, less 
  5.5   amounts paid out by the casino as winnings and for redemption of 
  5.6   chips or tokens.  Gross casino gambling receipts must not 
  5.7   include receipts from chips or tokens that have been purchased 
  5.8   but have not been redeemed or won back by the casino. 
  5.9      Subd. 2.  [TAX AUTHORIZED.] A county licensing a casino 
  5.10  under section 349.62 may by ordinance impose a tax of up to ten 
  5.11  percent of gross casino gambling receipts, payable at the times 
  5.12  and in the manner provided by the ordinance.  A tax imposed 
  5.13  under this section is in lieu of any tax imposed by the state on 
  5.14  gross casino gambling receipts. 
  5.15     Sec. 6.  Minnesota Statutes 2000, section 541.21, is 
  5.16  amended to read: 
  5.17     541.21 [COMMITMENTS FOR GAMBLING DEBT VOID.] 
  5.18     Every note, bill, bond, mortgage, or other security or 
  5.19  conveyance in which the whole or any part of the consideration 
  5.20  shall be for any money or goods won by gambling or playing at 
  5.21  cards, dice, or any other game whatever, or by betting on the 
  5.22  sides or hands of any person gambling, or for reimbursing or 
  5.23  repaying any money knowingly lent or advanced at the time and 
  5.24  place of such gambling or betting, or lent and advanced for any 
  5.25  gambling or betting to any persons so gambling or betting, shall 
  5.26  be void and of no effect as between the parties to the same, and 
  5.27  as to all persons except such as hold or claim under them in 
  5.28  good faith, without notice of the illegality of the 
  5.29  consideration of such contract or conveyance.  The provisions of 
  5.30  this section shall not apply to:  (1) pari-mutuel wagering 
  5.31  conducted under a license issued pursuant to chapter 240; (2) 
  5.32  purchase of tickets in the state lottery under chapter 349A; (3) 
  5.33  gaming activities conducted pursuant to the Indian Gaming 
  5.34  Regulatory Act, 25 U.S.C. 2701 et seq.; or (4) lawful gambling 
  5.35  activities permitted under chapter 349; or (5) gambling at a 
  5.36  casino licensed by a county under section 349.62. 
  6.1      Sec. 7.  Minnesota Statutes 2000, section 609.761, is 
  6.2   amended by adding a subdivision to read: 
  6.3      Subd. 2a.  [LICENSED CASINO.] Sections 609.755 and 609.76 
  6.4   do not prohibit the operation of a casino licensed by a county 
  6.5   under section 349.62. 
  6.6      Sec. 8.  [CONSTITUTIONAL AMENDMENT PROPOSED.] 
  6.7      An amendment to the Minnesota Constitution is proposed to 
  6.8   the people.  If the amendment is adopted, a section shall be 
  6.9   added to article XIII, to read: 
  6.10     Sec. 13.  The legislature may permit a county to authorize 
  6.11  and license a single casino in each county and impose a tax on 
  6.12  gross casino gambling receipts. 
  6.13     Sec. 9.  [SUBMISSION TO VOTERS.] 
  6.14     The amendment proposed in section 8 must be submitted to 
  6.15  the people at the 2002 general election.  The question submitted 
  6.16  must be: 
  6.17     "Shall the legislature be authorized to permit a county to 
  6.18  authorize and license a single casino in each county and impose 
  6.19  a tax on gross casino gambling receipts? 
  6.20                                     Yes .......
  6.21                                     No ........"
  6.22     Sec. 10.  [EFFECTIVE DATE.] 
  6.23     Sections 1 to 8 are effective January 1, 2003, except that 
  6.24  if the constitutional amendment proposed under section 8 is not 
  6.25  adopted at the 2002 general election, sections 1 to 7 shall not 
  6.26  take effect.