1.1                          A bill for an act 
  1.2             relating to gambling; proposing an amendment to the 
  1.3             Minnesota Constitution, article X, section 8; allowing 
  1.4             casino gaming at licensed pari-mutuel racetracks; 
  1.5             authorizing licensed racetracks to operate casinos on 
  1.6             the licensed premises; appropriating money; amending 
  1.7             Minnesota Statutes 2002, sections 240.01, by adding a 
  1.8             subdivision; 240.03; 240.07, subdivisions 2, 3, 4, 6; 
  1.9             240.08, subdivision 1; 240.10; 240.13, subdivision 6; 
  1.10            240.15, subdivision 3, by adding a subdivision; 
  1.11            240.22; 240.23; 240.27, subdivisions 1, 5; 240.35, 
  1.12            subdivision 1; 299L.07, subdivision 2a; 541.20; 
  1.13            541.21; 609.75, subdivision 3; proposing coding for 
  1.14            new law in Minnesota Statutes, chapter 240. 
  1.15  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.16                             ARTICLE 1
  1.17                   CASINO OPERATION AT RACETRACKS
  1.18     Section 1.  Minnesota Statutes 2002, section 240.01, is 
  1.19  amended by adding a subdivision to read: 
  1.20     Subd. 28.  [CASINO ADJUSTED GROSS PROCEEDS.] "Casino 
  1.21  adjusted gross proceeds" means the total amount of all wagers 
  1.22  made by players on games conducted at a casino, less all 
  1.23  payments to players.  For purposes of this subdivision, "payment 
  1.24  to players" includes all payment of cash premiums, merchandise, 
  1.25  tokens, redeemable game credits, or any other thing of value.  
  1.26     Sec. 2.  Minnesota Statutes 2002, section 240.03, is 
  1.27  amended to read: 
  1.28     240.03 [COMMISSION POWERS AND DUTIES.] 
  1.29     The commission has the following powers and duties:  
  1.30     (1) to regulate horse racing in Minnesota, and casino 
  2.1   gaming conducted at licensed racetracks, to ensure that it 
  2.2   is they are conducted in the public interest; 
  2.3      (2) to issue licenses as provided in this chapter; 
  2.4      (3) to enforce all laws and rules governing horse 
  2.5   racing and casino gaming at licensed racetracks; 
  2.6      (4) to collect and distribute all taxes provided for in 
  2.7   this chapter; 
  2.8      (5) to conduct necessary investigations and inquiries and 
  2.9   compel the submission of information, documents, and records it 
  2.10  deems necessary to carry out its duties; 
  2.11     (6) to supervise the conduct of pari-mutuel betting on 
  2.12  horse racing and casino gaming at licensed racetracks; 
  2.13     (7) to employ and supervise personnel under this chapter; 
  2.14     (8) to determine the number of racing days to be held in 
  2.15  the state and at each licensed racetrack; and 
  2.16     (9) to take all necessary steps to ensure the integrity of 
  2.17  racing in Minnesota and casino gaming conducted at licensed 
  2.18  racetracks.  
  2.19     Sec. 3.  Minnesota Statutes 2002, section 240.07, 
  2.20  subdivision 2, is amended to read: 
  2.21     Subd. 2.  [HEARINGS; INVESTIGATIONS.] Before granting an 
  2.22  initial class B license, or granting a renewed class B license 
  2.23  that for the first time includes an authorization to operate a 
  2.24  casino under section 240.31, the commission shall hold at least 
  2.25  one public hearing on the license.  Comprehensive investigations 
  2.26  must be conducted and their costs paid in the manner prescribed 
  2.27  by section 240.06, subdivision 3.  The commission has access to 
  2.28  all criminal history data compiled by the division of alcohol 
  2.29  and gambling enforcement on class B licensees and applicants.  
  2.30     Sec. 4.  Minnesota Statutes 2002, section 240.07, 
  2.31  subdivision 3, is amended to read: 
  2.32     Subd. 3.  [LICENSE ISSUANCE.] (a) If after considering the 
  2.33  information received from the hearing and investigations, the 
  2.34  commission determines that the applicant will conduct horse 
  2.35  racing in accordance with all applicable laws and rules, will 
  2.36  not adversely affect the public health, welfare, and safety, 
  3.1   that the license will not create a competitive situation that 
  3.2   will adversely affect racing and the public interest and that 
  3.3   the applicant is fit to sponsor and manage racing, the 
  3.4   commission may issue a class B license.  
  3.5      (b) If the commission determines that the licensee will 
  3.6   operate a card club in accordance with all applicable law and 
  3.7   rules and the applicant's approved plan of operation under 
  3.8   section 240.30, subdivision 6, that the operation of a card club 
  3.9   by the licensee will not adversely affect the public health, 
  3.10  welfare, and safety, and that the licensee is fit to operate a 
  3.11  card club, the commission may include with the class B license 
  3.12  an authorization to conduct a card club at the licensee's class 
  3.13  A racetrack as provided in section 240.30.  The commission may 
  3.14  give an interim authorization for the operation of a card club 
  3.15  that is effective until the expiration of the licensee's class B 
  3.16  license and may charge for the interim authorization a 
  3.17  proportionate amount of the additional class B license fee under 
  3.18  section 240.10. 
  3.19     (c) The license is for a period of one year. 
  3.20     (d) If the commission determines that the licensee will 
  3.21  operate a casino in accordance with all applicable laws and 
  3.22  rules and the applicant's approved plan of operation under 
  3.23  section 240.31, subdivision 4, that the operation of a casino by 
  3.24  the licensee will not adversely affect the public health, 
  3.25  welfare, and safety, and that the licensee is fit to operate a 
  3.26  casino, the commission may include with the class B license an 
  3.27  authorization to operate a casino on the licensed premises of 
  3.28  the licensee's class A racetrack as provided in section 240.31.  
  3.29  The commission may give an interim authorization for the 
  3.30  operation of a card club that is effective until the expiration 
  3.31  of the licensee's class B license and may charge for the interim 
  3.32  authorization a proportionate amount of the additional class B 
  3.33  license fee for a casino under section 240.10. 
  3.34     Sec. 5.  Minnesota Statutes 2002, section 240.07, 
  3.35  subdivision 4, is amended to read: 
  3.36     Subd. 4.  [RENEWAL.] On making the same determination as in 
  4.1   subdivision 3, the commission may renew a class B license 
  4.2   without a hearing unless it (1) a hearing is required under 
  4.3   subdivision 2, or (2) the commission determines a hearing to be 
  4.4   necessary. 
  4.5      Sec. 6.  Minnesota Statutes 2002, section 240.07, 
  4.6   subdivision 6, is amended to read: 
  4.7      Subd. 6.  [LICENSE SUSPENSION AND REVOCATION.] (a) 
  4.8   Suspension, revocation, and refusal to renew a class B license 
  4.9   is as provided in section 240.06, subdivision 7.  
  4.10     (b) In addition to grounds provided under section 240.06, 
  4.11  subdivision 7, the commission may revoke, or suspend for up to 
  4.12  one year a class B license that includes authorization to 
  4.13  operate a casino for a violation of law, rule, order, or 
  4.14  approved plan of operation that in the commission's opinion 
  4.15  adversely affects the integrity of casino gaming in Minnesota.  
  4.16  The commission may suspend such a class B license indefinitely 
  4.17  if it determines that the licensee has an officer, director, 
  4.18  shareholder, or other person with a direct, indirect, or 
  4.19  beneficial interest a person who is in the commission's opinion 
  4.20  inimical to the integrity of casino gaming in Minnesota. 
  4.21     (c) A license suspension or revocation or a refusal to 
  4.22  renew a class B license, is a contested case under section 14.57 
  4.23  to 14.69 of the Administrative Procedure Act, and is in addition 
  4.24  to criminal penalties imposed for a violation of law or rule.  
  4.25     Sec. 7.  Minnesota Statutes 2002, section 240.08, 
  4.26  subdivision 1, is amended to read: 
  4.27     Subdivision 1.  [AUTHORITY.] The commission may issue class 
  4.28  C occupational licenses to persons who wish to be employed in 
  4.29  horse racing where pari-mutuel betting is conducted as:  
  4.30     (a) (1) horse owners or lessees; 
  4.31     (b) (2) jockeys or drivers; 
  4.32     (c) (3) exercise riders; 
  4.33     (d) (4) grooms; 
  4.34     (e) (5) trainers and their assistants; 
  4.35     (f) (6) pari-mutuel personnel; 
  4.36     (g) (7) security officers; 
  5.1      (h) (8) casino employees (i) in a supervisory or managerial 
  5.2   capacity, (ii) whose employments involve the conduct of 
  5.3   gambling, and (iii) whom the commission determines that require 
  5.4   licensing to ensure the integrity of casino gaming; and 
  5.5      (9) other occupations the commission by rule determines 
  5.6   require licensing to ensure the integrity of horse racing in 
  5.7   Minnesota.  
  5.8      Sec. 8.  Minnesota Statutes 2002, section 240.10, is 
  5.9   amended to read: 
  5.10     240.10 [LICENSE FEES.] 
  5.11     (a) The fee for a class A license is $10,000 per year.  
  5.12     (b) The fee for a class B license is $100 for each assigned 
  5.13  racing day on which racing is actually conducted, and $50 for 
  5.14  each day on which simulcasting is authorized and actually takes 
  5.15  place, plus: 
  5.16     (1) $10,000 per year if the class B license includes 
  5.17  authorization to operate a card club; and 
  5.18     (2) $....... per year if the class B license includes 
  5.19  authorization to operate a casino.  
  5.20     (c) The fee for a class D license is $50 for each assigned 
  5.21  racing day on which racing is actually conducted.  
  5.22     (d) Fees imposed on class B and class D licenses must be 
  5.23  paid to the commission at a time and in a manner as provided by 
  5.24  rule of the commission.  
  5.25     (e) The commission shall by rule establish an annual 
  5.26  license fee for each occupation it licenses under section 240.08 
  5.27  but no annual fee for a class C license may exceed $100.  
  5.28     (f) License fee payments received must be paid by the 
  5.29  commission to the state treasurer for deposit in the general 
  5.30  fund. 
  5.31     Sec. 9.  Minnesota Statutes 2002, section 240.13, 
  5.32  subdivision 6, is amended to read: 
  5.33     Subd. 6.  [SIMULCASTING.] (a) The commission may permit an 
  5.34  authorized licensee to conduct simulcasting at the licensee's 
  5.35  facility on any day authorized by the commission.  All 
  5.36  simulcasts must comply with the Interstate Horse Racing Act of 
  6.1   1978, United States Code, title 15, sections 3001 to 3007.  
  6.2      (b) The commission may not authorize any day for 
  6.3   simulcasting at a class A facility during the racing season, and 
  6.4   a licensee may not be allowed to transmit out-of-state telecasts 
  6.5   of races the licensee conducts, unless the licensee has obtained 
  6.6   the approval of the horsepersons' organization representing the 
  6.7   majority of the horsepersons racing the breed involved at the 
  6.8   licensed racetrack during the preceding 12 months.  
  6.9      (c) The licensee may pay fees and costs to an entity 
  6.10  transmitting a telecast of a race to the licensee for purposes 
  6.11  of conducting pari-mutuel wagering on the race.  The licensee 
  6.12  may deduct fees and costs related to the receipt of televised 
  6.13  transmissions from a pari-mutuel pool on the televised race, 
  6.14  provided that one-half of any amount recouped in this manner 
  6.15  must be added to the amounts required to be set aside for purses.
  6.16     (d) With the approval of the commission and subject to the 
  6.17  provisions of this subdivision, a licensee may transmit 
  6.18  telecasts of races it conducts, for wagering purposes, to 
  6.19  locations outside the state, and the commission may allow this 
  6.20  to be done on a commingled pool basis.  
  6.21     (e) Except as otherwise provided in this section, 
  6.22  simulcasting may be conducted on a separate pool basis or, with 
  6.23  the approval of the commission, on a commingled pool basis.  All 
  6.24  provisions of law governing pari-mutuel betting apply to 
  6.25  simulcasting except as otherwise provided in this subdivision or 
  6.26  in the commission's rules.  If pools are commingled, wagering at 
  6.27  the licensed facility must be on equipment electronically linked 
  6.28  with the equipment at the licensee's class A facility or with 
  6.29  the sending racetrack via the totalizator computer at the 
  6.30  licensee's class A facility.  Subject to the approval of the 
  6.31  commission, the types of betting, takeout, and distribution of 
  6.32  winnings on commingled pari-mutuel pools are those in effect at 
  6.33  the sending racetrack.  Breakage for pari-mutuel pools on a 
  6.34  televised race must be calculated in accordance with the law or 
  6.35  rules governing the sending racetrack for these pools, and must 
  6.36  be distributed in a manner agreed to between the licensee and 
  7.1   the sending racetrack.  Notwithstanding subdivision 7 and 
  7.2   section 240.15, subdivision 5, the commission may approve 
  7.3   procedures governing the definition and disposition of unclaimed 
  7.4   tickets that are consistent with the law and rules governing 
  7.5   unclaimed tickets at the sending racetrack.  For the purposes of 
  7.6   this section, "sending racetrack" is either the racetrack 
  7.7   outside of this state where the horse race is conducted or, with 
  7.8   the consent of the racetrack, an alternative facility that 
  7.9   serves as the racetrack for the purpose of commingling pools.  
  7.10     (f) If there is more than one class B licensee conducting 
  7.11  racing within the seven-county metropolitan area, simulcasting 
  7.12  may be conducted only on races run by a breed that ran at the 
  7.13  licensee's class A facility within the 12 months preceding the 
  7.14  event.  
  7.15     Sec. 10.  [240.131] [CASINO REVENUE.] 
  7.16     Subdivision 1.  [PURSE PAYMENTS.] A class B licensee that 
  7.17  operates a casino under section 240.31 must set aside two 
  7.18  percent of casino adjusted gross proceeds to be used for purse 
  7.19  payments. 
  7.20     Subd. 2.  [BREEDERS FUND.] From the amounts set aside under 
  7.21  subdivision 1, the licensee must pay ten percent to the 
  7.22  commission for deposit in the breeders fund. 
  7.23     Subd. 3.  [NEGOTIATIONS AUTHORIZED.] The licensee and the 
  7.24  horseperson's organization that represents the majority of 
  7.25  horsepersons who have raced at the licensee's racetrack during 
  7.26  the preceding 12 calendar months may negotiate percentages 
  7.27  different from those prescribed in subdivisions 1 and 2 with the 
  7.28  approval of the racing commission. 
  7.29     Sec. 11.  Minnesota Statutes 2002, section 240.15, is 
  7.30  amended by adding a subdivision to read: 
  7.31     Subd. 1a.  [CASINO GROSS RECEIPTS TAX.] A tax is imposed on 
  7.32  casino gross receipts from a casino operated by a class B 
  7.33  licensee at the rate of 28 percent of casino adjusted gross 
  7.34  proceeds.  In addition, the licensee shall pay:  
  7.35     (1) if the licensee's racetrack is located within a city, 
  7.36  one-half percent of casino adjusted gross proceeds to the county 
  8.1   in which the licensee's racetrack is located and one-half 
  8.2   percent of casino adjusted gross proceeds to the city in which 
  8.3   the licensee's racetrack is located; or 
  8.4      (2) if the licensee's racetrack is not located within a 
  8.5   city, one percent of casino adjusted gross proceeds to the 
  8.6   county in which the licensee's racetrack is located.  
  8.7      Sec. 12.  Minnesota Statutes 2002, section 240.15, 
  8.8   subdivision 3, is amended to read: 
  8.9      Subd. 3.  [TAX EXCLUSIVE.] The tax taxes imposed by 
  8.10  subdivision subdivisions 1 is and 1a are in lieu of any tax or 
  8.11  license fee, other than taxes on real property, imposed by a 
  8.12  political subdivision and in lieu of any other sales or excise 
  8.13  tax imposed by the state on pari-mutuel pools or, pari-mutuel 
  8.14  ticket sales, or casino gross receipts. 
  8.15     Sec. 13.  Minnesota Statutes 2002, section 240.22, is 
  8.16  amended to read: 
  8.17     240.22 [FINES.] 
  8.18     The commission shall by rule establish a graduated schedule 
  8.19  of civil fines for violations of laws related to horse racing or 
  8.20  of, the commission's rules, or an approved plan of operation for 
  8.21  a casino.  The schedule must include minimum and maximum fines 
  8.22  for each violation and be based on and reflect the culpability, 
  8.23  frequency and severity of the violator's actions.  The 
  8.24  commission may impose a fine from this schedule on a licensee 
  8.25  for a violation of those rules or laws relating to horse 
  8.26  racing or approved plan of operation for a casino.  The fine is 
  8.27  in addition to any criminal penalty imposed for the same 
  8.28  violation.  Fines imposed by the commission must be paid to the 
  8.29  commission and forwarded to the state treasurer for deposit in 
  8.30  the general fund.  A fine in excess of $2,000 is a contested 
  8.31  case under the Administrative Procedure Act. 
  8.32     Sec. 14.  Minnesota Statutes 2002, section 240.23, is 
  8.33  amended to read: 
  8.34     240.23 [RULEMAKING AUTHORITY.] 
  8.35     The commission has the authority, in addition to all other 
  8.36  rulemaking authority granted elsewhere in this chapter to 
  9.1   promulgate rules governing:  
  9.2      (a) (1) the conduct of horse races held at licensed 
  9.3   racetracks in Minnesota, including but not limited to the rules 
  9.4   of racing, standards of entry, operation of claiming races, 
  9.5   filing and handling of objections, carrying of weights, and 
  9.6   declaration of official results; 
  9.7      (b) (2) wire communications between the premises of a 
  9.8   licensed racetrack and any place outside the premises; 
  9.9      (c) (3) information on horse races which that is sold on 
  9.10  the premises of a licensed racetrack; 
  9.11     (d) (4) liability insurance which it may require of all 
  9.12  class A, class B, and class D licensees; 
  9.13     (e) (5) the auditing of the books and records of a licensee 
  9.14  by an auditor employed or appointed by the commission; 
  9.15     (f) (6) emergency action plans maintained by licensed 
  9.16  racetracks and their periodic review; 
  9.17     (g) (7) safety, security, and sanitation of stabling 
  9.18  facilities at licensed racetracks; 
  9.19     (h) (8) entry fees and other funds received by a licensee 
  9.20  in the course of conducting racing which the commission 
  9.21  determines must be placed in escrow accounts; 
  9.22     (i) (9) affirmative action in employment and contracting by 
  9.23  class A, class B, and class D licensees; and 
  9.24     (j) (10) any other aspect of horse racing or, pari-mutuel 
  9.25  betting, or casino gaming which in its opinion affects the 
  9.26  integrity of racing or casino gaming or the public health, 
  9.27  welfare, or safety.  
  9.28     Rules of the commission are subject to chapter 14, the 
  9.29  Administrative Procedure Act. 
  9.30     Sec. 15.  Minnesota Statutes 2002, section 240.27, 
  9.31  subdivision 1, is amended to read: 
  9.32     Subdivision 1.  [PERSONS EXCLUDED.] The commission may 
  9.33  exclude from any and all licensed racetracks in the state a 
  9.34  person who:  
  9.35     (a) (1) has been convicted of a felony under the laws of 
  9.36  any state or the United States; 
 10.1      (b) (2) has had a license suspended, revoked, or denied by 
 10.2   the commission or by the racing authority of any other 
 10.3   jurisdiction; or 
 10.4      (c) (3) is determined by the commission, on the basis of 
 10.5   evidence presented to it, to be a threat to the integrity of 
 10.6   racing or casino gaming in Minnesota.  
 10.7      Sec. 16.  Minnesota Statutes 2002, section 240.27, 
 10.8   subdivision 5, is amended to read: 
 10.9      Subd. 5.  [EXCLUSIONS BY RACETRACK.] The holder of a 
 10.10  license to conduct racing may eject and exclude from its 
 10.11  premises any licensee or any other person who is in violation of 
 10.12  any state law or commission rule or order or who is a threat to 
 10.13  racing or casino integrity or the public safety.  A person so 
 10.14  excluded from racetrack premises may appeal the exclusion to the 
 10.15  commission and must be given a public hearing on the appeal upon 
 10.16  request.  At the hearing the person must be given the 
 10.17  opportunity to show cause why the exclusion should not have been 
 10.18  ordered.  If the commission after the hearing finds that the 
 10.19  integrity of racing or casino gaming and the public safety do 
 10.20  not justify the exclusion, it shall order the racetrack making 
 10.21  the exclusion to reinstate or readmit the person.  An appeal of 
 10.22  a commission order upholding the exclusion is governed by 
 10.23  section 240.20. 
 10.24     Sec. 17.  [240.31] [CASINO.] 
 10.25     Subdivision 1.  [CASINO AUTHORIZED.] A class B licensee 
 10.26  conducting pari-mutuel betting on horse racing at a class A 
 10.27  racetrack may operate a casino on the premises of the licensed 
 10.28  racetrack, if: 
 10.29     (1) the commission has authorized the licensee to operate a 
 10.30  casino under section 240.07, subdivision 3, paragraph (c); and 
 10.31     (2) the commission has approved the licensee's plan of 
 10.32  operation under subdivision 4. 
 10.33     Except for the first calendar year of casino operation, the 
 10.34  commission may not authorize a class B licensee to operate a 
 10.35  casino in any calendar year unless the licensee has conducted at 
 10.36  least 50 days of live horse racing, with a minimum of seven 
 11.1   races on each racing day, at the licensee's racetrack in the 
 11.2   previous calendar year. 
 11.3      Subd. 2.  [LICENSE APPLICATION.] The application for a 
 11.4   class B license with authorization to operate a casino must be 
 11.5   on a form the commission prescribes.  The application must, in 
 11.6   addition to the requirements under section 240.07, include a 
 11.7   detailed description of the casino premises and a copy of the 
 11.8   proposed plan of operation. 
 11.9      Subd. 3.  [CASINO GAMES AUTHORIZED.] A casino authorized 
 11.10  under this section may conduct any form of gambling authorized 
 11.11  under a tribal-state compact negotiated under section 3.9221. 
 11.12     Subd. 4.  [PLAN OF OPERATION.] A class B licensee may not 
 11.13  operate a casino at a licensed racetrack unless the licensee has 
 11.14  submitted, and the commission approved, a plan of operation for 
 11.15  the casino which includes, at a minimum: 
 11.16     (1) days and hours of operation; 
 11.17     (2) games to be conducted; 
 11.18     (3) the rules for each game, including wagering limits and, 
 11.19  where applicable, payout percentages, and procedures for 
 11.20  informing casino patrons of the rules; 
 11.21     (4) number of gaming devices to be operated; 
 11.22     (5) specifications and technical standards for gaming 
 11.23  devices, including hardware and software; 
 11.24     (6) security measures to be undertaken at the casino; 
 11.25     (7) accounting and internal audit procedures at the casino; 
 11.26     (8) classifications of employees at the casino, including 
 11.27  all employees who have a supervisory role at the casino; 
 11.28     (9) a plan for the training of casino personnel in 
 11.29  identification of problem gamblers and appropriate action to 
 11.30  prevent or control problem gambling; and 
 11.31     (10) other elements the commission requires as part of the 
 11.32  license application process. 
 11.33     Subd. 5.  [AMENDMENTS TO PLAN.] The licensee may amend the 
 11.34  plan of operation only with the commission's approval.  The 
 11.35  commission may withdraw its approval of a plan of operation. 
 11.36     Subd. 6.  [VIOLATION OF PLAN.] (a) A violation of a law or 
 12.1   rule relating to casino operation or a violation of an approved 
 12.2   plan of operation is deemed to be a violation of law or rule for 
 12.3   purposes of section 240.22. 
 12.4      (b) A violation of an approved plan of operation for a 
 12.5   casino is deemed to be a violation of a rule of the commission 
 12.6   for purposes of section 240.26, subdivision 3. 
 12.7      Subd. 7.  [GAMING DEVICES.] (a) No gaming device may be 
 12.8   installed, operated, or used at a casino under this section 
 12.9   unless it has been inspected and approved by the commissioner of 
 12.10  public safety acting through the division of alcohol and 
 12.11  gambling enforcement.  The commissioner may charge a fee to 
 12.12  cover the costs of inspection, testing, and approval. 
 12.13     (b) A licensee under this section may purchase or lease a 
 12.14  gambling device only from a distributor licensed under section 
 12.15  299L.07. 
 12.16     Subd. 8.  [REIMBURSEMENT TO COMMISSION.] The commission 
 12.17  shall require that the licensee reimburse it for the 
 12.18  commission's actual costs, including personnel costs, of 
 12.19  regulating the casino. 
 12.20     Subd. 9.  [CONFLICT OF INTEREST.] The prohibitions against 
 12.21  betting at a licensed racetrack in section 240.28, subdivision 
 12.22  2, apply to participating in gaming at a casino licensed under 
 12.23  this section.  A violation of this prohibition is a violation 
 12.24  for purposes of section 240.28, subdivision 3. 
 12.25     Sec. 18.  Minnesota Statutes 2002, section 240.35, 
 12.26  subdivision 1, is amended to read: 
 12.27     Subdivision 1.  [GENERALLY.] A licensee of the commission 
 12.28  may detain a person if the licensee has probable cause to 
 12.29  believe that the person detained has violated section 609.76 
 12.30  while at a card club authorized by under section 240.30 or 
 12.31  casino authorized under section 240.31.  For purposes of this 
 12.32  section, "licensee" means (1) the commission's director of 
 12.33  racing security or, (2) a security officer licensed under 
 12.34  Minnesota Rules, chapter 7878, or (3) a person, including a 
 12.35  commission employee, authorized by the commission to make such 
 12.36  detentions at a casino. 
 13.1      Sec. 19.  [CONSTITUTIONAL AMENDMENT PROPOSED.] 
 13.2      An amendment to the Minnesota Constitution, article X, 
 13.3   section 8, is proposed to the people.  If the amendment is 
 13.4   adopted the section will read: 
 13.5      Sec. 8.  [PARI-MUTUEL BETTING; CASINO GAMING.] The 
 13.6   legislature may authorize on-track pari-mutuel betting on horse 
 13.7   racing in a manner prescribed by law.  The legislature may by 
 13.8   law authorize and tax casino gaming conducted at a racetrack 
 13.9   licensed for pari-mutuel betting on horse racing.  
 13.10     Sec. 20.  [SUBMISSION TO VOTERS.] 
 13.11     The proposed amendment must be submitted to the people at 
 13.12  the 2004 general election.  The question submitted shall be: 
 13.13     "Shall the Minnesota Constitution be amended to allow the 
 13.14  legislature to authorize and tax casino gaming at licensed 
 13.15  pari-mutuel racetracks? 
 13.16                                     Yes .......
 13.17                                     No ........"
 13.18     Sec. 21.  [APPROPRIATION.] 
 13.19     $......., or so much thereof as the commission determines 
 13.20  is needed, is appropriated from the general fund to the 
 13.21  Minnesota racing commission in fiscal year 2005 for 
 13.22  investigation, application processing, license issuance, and 
 13.23  regulation of casino gaming under sections 1 to 18. 
 13.24     Sec. 22.  [EFFECTIVE DATE.] 
 13.25     Sections 1 to 18 are effective December 1, 2004.  However, 
 13.26  if the constitutional amendment proposed in section 19 is not 
 13.27  adopted at the 2004 general election, sections 1 to 18 shall not 
 13.28  take effect. 
 13.29                             ARTICLE 2
 13.30                       CONFORMING AMENDMENTS
 13.31     Section 1.  Minnesota Statutes 2002, section 299L.07, 
 13.32  subdivision 2a, is amended to read: 
 13.33     Subd. 2a.  [RESTRICTIONS.] (a) A manufacturer licensed 
 13.34  under this section may sell, offer to sell, lease, or rent, in 
 13.35  whole or in part, a gambling device only to a distributor 
 13.36  licensed under this section. 
 14.1      (b) A distributor licensed under this section may sell, 
 14.2   offer to sell, market, rent, lease, or otherwise provide, in 
 14.3   whole or in part, a gambling device only to: 
 14.4      (1) the governing body of a federally recognized Indian 
 14.5   tribe that is authorized to operate the gambling device under a 
 14.6   tribal state compact under the Indian Gaming Regulatory Act, 
 14.7   Public Law Number 100-497, and future amendments to it; 
 14.8      (2) a person for use in the person's dwelling for display 
 14.9   or amusement purposes in a manner that does not afford players 
 14.10  an opportunity to obtain anything of value; 
 14.11     (3) another distributor licensed under this section; or 
 14.12     (4) a person in another state who is authorized under the 
 14.13  laws of that state to possess the gambling device; or 
 14.14     (5) a class B licensee authorized to operate a casino under 
 14.15  section 240.31. 
 14.16     Sec. 2.  Minnesota Statutes 2002, section 541.20, is 
 14.17  amended to read: 
 14.18     541.20 [RECOVERY OF MONEY LOST.] 
 14.19     Every person who, by playing at cards, dice, or other game, 
 14.20  or by betting on the hands or sides of such as are gambling, 
 14.21  shall lose to any person so playing or betting any sum of money 
 14.22  or any goods, and pays or delivers the same, or any part 
 14.23  thereof, to the winner, may sue for and recover such money by a 
 14.24  civil action, before any court of competent jurisdiction.  For 
 14.25  purposes of this section, gambling shall not include pari-mutuel 
 14.26  wagering or casino gaming conducted under a license issued 
 14.27  pursuant to under chapter 240, purchase or sale of tickets in 
 14.28  the state lottery, or gambling authorized under chapters 349 and 
 14.29  349A. 
 14.30     Sec. 3.  Minnesota Statutes 2002, section 541.21, is 
 14.31  amended to read: 
 14.32     541.21 [COMMITMENTS FOR GAMBLING DEBT VOID.] 
 14.33     Every note, bill, bond, mortgage, or other security or 
 14.34  conveyance in which the whole or any part of the consideration 
 14.35  shall be for any money or goods won by gambling or playing at 
 14.36  cards, dice, or any other game whatever, or by betting on the 
 15.1   sides or hands of any person gambling, or for reimbursing or 
 15.2   repaying any money knowingly lent or advanced at the time and 
 15.3   place of such gambling or betting, or lent and advanced for any 
 15.4   gambling or betting to any persons so gambling or betting, shall 
 15.5   be void and of no effect as between the parties to the same, and 
 15.6   as to all persons except such as hold or claim under them in 
 15.7   good faith, without notice of the illegality of the 
 15.8   consideration of such contract or conveyance.  The provisions of 
 15.9   this section shall not apply to:  (1) pari-mutuel wagering and 
 15.10  casino gaming conducted under a license issued pursuant to under 
 15.11  chapter 240; (2) purchase of tickets in the state lottery under 
 15.12  chapter 349A; (3) gaming activities conducted pursuant to the 
 15.13  Indian Gaming Regulatory Act, 25 U.S.C. 2701 et seq.; or (4) 
 15.14  lawful gambling activities permitted under chapter 349. 
 15.15     Sec. 4.  Minnesota Statutes 2002, section 609.75, 
 15.16  subdivision 3, is amended to read: 
 15.17     Subd. 3.  [WHAT ARE NOT BETS.] The following are not bets: 
 15.18     (1) A contract to insure, indemnify, guarantee or otherwise 
 15.19  compensate another for a harm or loss sustained, even though the 
 15.20  loss depends upon chance. 
 15.21     (2) A contract for the purchase or sale at a future date of 
 15.22  securities or other commodities. 
 15.23     (3) Offers of purses, prizes or premiums to the actual 
 15.24  contestants in any bona fide contest for the determination of 
 15.25  skill, speed, strength, endurance, or quality or to the bona 
 15.26  fide owners of animals or other property entered in such a 
 15.27  contest. 
 15.28     (4) The game of bingo when conducted in compliance with 
 15.29  sections 349.11 to 349.23. 
 15.30     (5) A private social bet not part of or incidental to 
 15.31  organized, commercialized, or systematic gambling. 
 15.32     (6) The operation of equipment or the conduct of a raffle 
 15.33  under sections 349.11 to 349.22, by an organization licensed by 
 15.34  the gambling control board or an organization exempt from 
 15.35  licensing under section 349.166.  
 15.36     (7) Pari-mutuel betting on horse racing when the betting is 
 16.1   or participation in casino gaming conducted under chapter 240.  
 16.2      (8) The purchase and sale of state lottery tickets under 
 16.3   chapter 349A.  
 16.4      Sec. 5.  [EFFECTIVE DATE.] 
 16.5      Sections 1 to 4 are effective December 1, 2004.  However, 
 16.6   if the constitutional amendment proposed in article 1, section 
 16.7   19, is not adopted at the 2004 general election, sections 1 to 4 
 16.8   shall not take effect.