(A) Leasing agreements. A licensee may lease any portion of the licensed premises to "qualified" organizations licensed to conduct lawful gambling pursuant to M.S. Ch. 349, as it may be amended from time to time. An organization is "qualified" for leasing purposes if it meets one of the following criteria:
(1) At least 40% of its active members reside within the city;
(2) Eighty percent of its active members reside within Minnesota School District 77; or
(3) One hundred percent of net profits generated within the city are irrevocably designated to an eligible recipient as established from time to time by resolution of the Council and located within the corporate limits of the cities of North Mankato or Mankato, Minnesota. For those organizations qualifying under this subsection, a minimum of 40% of the net profits generated within the city will be restricted to the benefit of local residents as defined by the geographic area within Minnesota School District 77.
(B) Liquor license renewals. At the time a licensee applies for renewal of a liquor license or permit, there shall be submitted to the City Clerk copies of all leasing agreements concerning any lawful gambling covering any portion of the previous 12 months. The licensee shall also submit a copy of the verified statement of the organization concerning the residency requirement.
(C) Leasing restrictions. The following restrictions apply to lawful gambling leases.
(1) A licensee may not lease to anyone except a "qualified" organization.
(2) A licensee may not lease any portion of the licensed premises to more than 1 organization licensed to conduct lawful gambling at the same time.
(3) The maximum term of such lease shall be no more than 2 years, but such lease may be renewed.
(D) Local gambling tax.
(1) A tax of 3% shall be imposed upon the gross receipts generated within the city by licensed organizations from the conduct of lawful gambling activities. The 3% tax shall be levied on the gross receipts less the cost of prizes actually paid out by the organization.
(2) The tax shall be paid to the city on a monthly basis, on or before the last business day of the month following the month for which the report is made. Such payment shall be accompanied by a report containing the following information upon such form as may be required by the City Finance Director:
(a) Total amount of receipts from lawful gambling activities within the city during the reporting period.
(b) The total amount of prizes actually paid out by the organization during the reporting period from such gross receipts.
(c) The signature of the person filing the return.
(d) The period covered by the return.
(E) Specific expenditures.
(1) A licensed organization shall make specific expenditures of 10% from its net profits derived from lawful gambling. The 10% expenditure shall be levied on gross receipts generated within the city less prizes actually paid out by the organization and amounts expended for allowable expenses to include the 3% local gambling tax attributable to such gross receipts.
(2) The specific expenditure shall be paid twice a year on or before June 30 and December 31 toward the lawful purpose established from time to time by resolution of the Council.
(3) The licensed organization shall also submit the following information upon such form as may be required by the City Finance Director:
(a) Total amount of receipts generated within the city from lawful gambling activities during the reporting period;
(b) The total amount of prizes actually paid out attributable to the gross receipts by the organization during the reporting period;
(c) The total amount of money expended for allowable expenses attributable to the gross receipts;
(d) The amount of net profits derived from lawful gambling during the reporting period attributable to the gross profits;
(e) The identification of the lawful purpose to which such 10% expenditure was made;
(f) The signature of the person filing the report;
(g) The period covered by the report; and
(h) A receipt from the person or entity representing the lawful purpose to which such 10% expenditure was made.
(Ord. 107, passed 6-5-1989; Am. Ord. 121, passed 9-16-1991; Am. Ord. 155, passed 5-20-1996; Am. Ord. 48, 4th Series, passed 1-22-2013)