(A) Purpose. The purpose of this section is to regulate and control the conduct of lawful gambling and to ensure that profits derived therefrom in the city provide, to the fullest extent authorized by law, direct benefits to the city's citizens.
(B) Definitions. As used in this section, the terms defined in M.S. § 349.12 are incorporated herein by reference.
LAWFUL GAMBLING. The operation, conduct or sale of bingo, raffles, paddle wheels, tip boards and pull-tabs for a lawful purpose.
NET PROFIT. Gross profit from gambling conducted on the licensed premises, less reasonable sums actually expended for allowable expenses.
ORGANIZATION. Any fraternal, religious, veterans or other non-profit organization which has been in existence for at least three years and has at least 15 active members.
TRADE AREA. An area within a 15-mile radius of the city hall building, or the boundaries of the Maccray School District, whichever is larger.
(C) Provisions of state law adopted/exempt permits.
(1) The provisions of M.S. §§ 349.11 through 349.22 are adopted and made a part of this section as if set out in full. In addition, the regulations of this section shall apply to the conduct of lawful gambling within the city.
(2) It is unlawful for any organization exempt from licensing under M.S. § 349.166, as may be amended from time to time, to conduct lawful gambling without an exempt permit from the city; provided, however, that, bingo conducted in a nursing home or a senior citizens housing project, or by a senior citizen organization, conducted as provided and exempted by statute, shall not require a permit.
(D) Notice, approval or disapproval.
(1) Notice. The appropriate party shall notify the City Council in writing in the manner required by law of each pending application for a premises permit. The applicant shall cooperate fully with city officials in supplying all information provided for in this section. The City Council shall determine whether the organization meets all the criteria provided for in this section necessary to approve a premises permit.
(2) Approval or disapproval. Each pending application for a premises permit shall be approved or disapproved by resolution of the City Council within the time allowed by state law.
(3) Failure to act. Failure of the City Council to take action on an application within the time allowed by law shall be deemed an approval.
(4) Basis for disapproval. The Council may disapprove an application for any of the following reasons:
(a) Violation by the applicant or at the premises to be licensed of any statute, rule, regulation or ordinance relating to gambling or the operation of the establishment at the premises for which the permit is sought;
(b) If the applicant is a tenant, violations by the landlord of any statute, ordinance, rule or regulation regarding operation of the landlord's establishment;
(c) Any reason which would justify the Minnesota Gambling Control Board in denying an application for a license;
(d) Issuance of the permit would cause the applicant or the premises to violate this section;
(e) Gambling at the proposed site would be detrimental to health, safety or welfare of the residents.
(E) Gambling prohibited; exemption. No person, except an organization which has a premises permit from the Minnesota Gambling Control Board pursuant to M.S. Ch. 349, or an organization permitted under M.S. Ch. 349 to conduct gambling without a permit, shall conduct lawful gambling within the city.
(F) Application for permit.
(1) Contents of application. An organization shall make application for a premises permit on a form prescribed by the Minnesota Gambling Control Board. The application shall contain the following:
(a) The name and address of the applying organization and of the organization's gambling manager and employees;
(b) A description of the site for which the license and permit are sought, including its address and, where applicable, its placement within another premises or establishment;
(c) If the site is leased, the name and address of the lessor and such information about the lease as the city may require, including all rents and other charges for the use of the site; and
(d) Other information the city deems necessary to carry out the purposes of this section.
(2) Notification of change. An organization holding a premises permit must notify the City Clerk in writing within ten days whenever any material change is made in the above information.
(G) City investigation fees.
(1) Fee required. Organizations applying for or renewing premises permits shall pay the city an investigation fee set by resolution of the City Council. This fee shall accompany the application, and it shall reimburse the city for its cost incident to conducting a background investigation of the organization, its employees, and the location from which the organization intends to operate.
(2) Findings and recommendations. The City Clerk and City License Inspector shall investigate each application and report their findings and recommendations to the City Council through the City Administrator. The findings and recommendations shall contain a statement from the City Administrator that the premises comply with all provisions of the city zoning ordinance.
(H) Location.
(1) One permit per premises. No more than one premises permit shall be issued at any location in the city.
(2) Limit on locations per organization. No organization may conduct gambling in more than two locations within the city.
(I) Acts prohibited.
(1) Use by minors prohibited. No person under the age of 18 years shall be permitted to participate in any lawful gambling, except bingo.
(2) Participation by volunteers or employees prohibited. No employee of the licensed organization or any volunteer providing services connected with gambling devices or members of the household of such employee or volunteer, shall be permitted to participate in any lawful gambling by which a prize may be won provided, however, that members of the household of such employee or volunteer may participate in bingo.
(J) Expenditures within city. An organization that has received a premises permit to conduct lawful gambling must expend 50% of its net profits from lawful gambling on lawful purposes conducted in the city's trade area. Such expenditures shall be made within the same calendar year that such proceeds are received by the organization conducting the charitable gambling. Any expenditures made during January of any year may, at the option of the charitable organization, be deemed to have been made in a prior calendar year to the extent necessary to meet the requirements of this section.
(K) Filing of records; inspections; access to records.
(1) Filing of records. Every organization holding a premises permit in the city shall file with the City Clerk copies of the Schedule C required to be filed with the Minnesota Gambling Control Board pursuant to M.S. Ch. 349 and the rules and regulations promulgated thereunder, by January 30 of each year.
(2) Open to inspection. Every gambling event conducted in the city by an organization pursuant to M.S. Ch. 349 shall be open to inspection by officers of the Police Department and other city officials as may be designated from time to time by the City Manager.
(3) Submit copies of reports. Upon request, every organization holding a premises permit shall submit a copy of any reports it is required to make to the state pursuant to M.S. Ch. 349 to the city.
(L) Further regulations authorized. If the City Council deems it appropriate, further regulations may be adopted by resolution of the Council. Copies of any such additional regulations shall be furnished to all licensees.
(M) Grandfathering of existing licensed organization. Organizations currently licensed by the Minnesota Gambling Control Board which are operating in the city may continue to operate and may renew their premises permits as long as such premises permits comply with all other provisions of this section and other laws.
(N) Penalty. Any person violating any provision of this section is guilty of a misdemeanor and, upon conviction thereof, shall be subject to the penalty for a misdemeanor as the same is established from time to time by the state, plus the costs of prosecution. In addition, any organization that does not comply with division (H) of this section shall donate 10% of the net profits from gambling to the city for each year in which it fails to comply with that section. This amount shall be paid to the city by January 31 of each year for the prior year. The city shall credit the funds to the Park and Recreation Fund for distribution by the city for lawful purposes as defined by M.S. Ch. 349.
(Ord. 346, passed 4-20-2021)