HB 685-FN-A – AS INTRODUCED
2005 SESSION
08/04
HOUSE BILL 685-FN-A
AN ACT permitting casino gambling.
SPONSORS: Rep. Gionet, Graf 3; Rep. Ingram, Rock 4; Rep. Asselin, Rock 7; Rep. Gibson, Hills 19; Rep. Goyette, Hills 27; Sen. Gallus, Dist 1
COMMITTEE: Executive Departments and Administration
This bill allows the establishment of a resort and casino and grants the lottery commission responsibility for regulating the casino and authority to hire an executive director.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
05-0709
08/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Five
AN ACT permitting casino gambling.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Chapter; White Mountain Resort and Casino. Amend RSA by inserting after chapter 284 the following new chapter:
CHAPTER 284-A
WHITE MOUNTAIN RESORT AND CASINO
284-A:1 Definitions. In this chapter:
I. “Casino employee” means any person employed in the operation of a casino, including without limitation, boxmen, cashiers, dealers or croupiers, floormen, hosts or other persons empowered to extend credit or complimentary service, machine mechanics, security personnel or inspectors, shift or pit bosses, supervisors or managers, and other persons employed within the casino.
II. “Casino work permit” means any card, certificate, or permit issued by the commission which authorizes the employment of the holder as a casino employee at a casino.
III. “Commission” means the lottery commission or an executive director to whom authority may be delegated under RSA 284-A:2.
IV. “Commissioner” means any member of the lottery commission.
V. “Economic development resort and casino” means a facility which is operated in accordance with this chapter and rules adopted under authority of this chapter. The facility shall include rooms, restaurants, and entertainment facilities consistent with a destination resort and casino.
VI. “Executive director” means the executive director hired by the commission.
VII. “Game” or “gambling game” means any banking or percentage game located exclusively within a casino played with cards, dice, or any mechanical or electrical device or machine for money or other consideration including, but not limited to: roulette, twenty-one, blackjack, baccarat, chemin-de-fer, dice, any game of poker, or slot machine. For the purposes of this chapter, “game” or “gambling game” shall not include the game of bingo, any derivative of bingo such as keno, or betting of any sort upon sports events or other activities not conducted in a casino.
VIII. “Gaming” or “gambling” means the dealing, operating, carrying on, conducting, maintaining, or exposing for pay any game as defined in paragraph VII.
IX. “Gaming device” means any mechanical or electrical contrivance or machine used in connection with gaming or any game.
X. “Gross revenues” means the total of all sums actually received by a casino from gaming operations, less only the total of all sums paid out as winnings to patrons. Gross revenues shall be calculated daily.
XI. “Hearing examiner” means a commissioner or other person authorized by the commission to conduct investigative hearings.
XII. “House profits” means gross revenues from the casino in their entirety, less operating and administrative expenses and bond payments.
XIII. “Person” means any corporation, association, operation, firm, partnership, trust, or other form of business association, as well as a natural person.
XIV. “Slot machine” means any mechanical, electrical, or other device, contrivance, or machine which, upon insertion of a coin, token, or similar object, or upon payment of any consideration, is available to play or operate, the play or operation of which, whether by reason of skill of the operator or application of the element of chance, or both, may deliver or entitle the person playing or operating the machine to receive cash, premiums, merchandise, tokens, or anything of value, whether the payoff is made automatically from the machine or in any other manner.
284-A:2 Executive Director. The commission may appoint an executive director who shall serve at the commission’s pleasure. No person shall be eligible for nomination and appointment to such office unless he or she has had at least 5 years of responsible administrative experience in public or business administration. The executive director shall receive an annual salary as specified in RSA 94:1-a. The executive director shall be responsible to, and under the supervision and direction of the commission, for the administration of this chapter and for enforcement of the rules adopted by the commission.
284-A:3 Commission Duties; Investigators. The commission shall:
I. Participate in the selection of a suitable and qualified developer pursuant to RSA 284-A:4.
II. Regulate casino operations.
III. Collect and administer the revenues received under this chapter.
IV. Investigate the circumstances surrounding any act or transaction for which commission approval is required.
V. Observe the conduct of all persons having a material involvement directly or indirectly with the operation or management of the casino to ensure that there shall be no material involvement directly or indirectly with the management or operation of the casino by:
(a) Unqualified or disqualified persons.
(b) Unsuitable persons.
(c) Persons whose operations are conducted in an unsuitable manner, or in an unsuitable place or location.
284-A:4 Bidding and Location. One economic development resort and casino shall be constructed and exclusively operated for a period and a location to be determined by negotiation between the commission and the operator of the resort and casino.
284-A:5 Construction; Commencement of Operations.
I. Construction plans shall be approved by all appropriate local and state agencies and all necessary permits shall be obtained before the commencement of economic development resort and casino construction. The operator shall be selected by the commission, after receiving proposals and bids from applicants. The selected operator shall pay a fee of $100,000 to the commission to fund construction oversight and initial regulatory oversight.
II. Temporary operation prior to completion of construction may be permitted as agreed during contract negotiation.
284-A:6 Inspection. The commission and its agents, inspectors, and employees shall have the authority, without notice and without warrant, to:
I. Inspect and examine the premises on which casino gambling is conducted.
II. Inspect all equipment and supplies in, about, upon, or around such premises.
III. Seize summarily and remove from such premises and impound any such equipment or supplies for the purposes of examination and inspection.
IV. Inspect books, memoranda, and documents showing the receipts and disbursements of the casino.
V. Seize, impound, or assume physical control of any book, record, ledger, game, device, cash box and its contents, counting room or its contents, or casino operations. Any equipment, supplies, records, or other objects or documents seized, impounded, or physically controlled by the commission under this section may be held pending the filing and disposition of a complaint.
VI. Inspect the casino at any time during hours of operation and certify the accuracy of money and vouchers received by the casino, in order to ensure compliance with applicable statutes and the rules of the commission.
284-A:7 Subpoena; Service of Process. The commission shall have authority to issue subpoenas and compel the attendance of witnesses at any place within this state, to administer oaths, and to require testimony under oath. Any process or notice may be served in a manner provided for service of process and notice in civil actions.
284-A:8 Commission Records. The commission shall keep a record of all proceedings under this chapter. The commission may also maintain such other files and records as it deems necessary.
284-A:9 Enforcement.
I. The commission shall request the attorney general to proceed in any action or prosecution to enforce the provisions of this chapter.
II. At any time within 5 years after any amount of revenue required to be collected under this chapter becomes due and payable, the commission through the attorney general may bring a civil action in the courts of this state, any other state, or of the United States to collect in the name of the state of New Hampshire the amount delinquent together with penalties and interest. If the action is brought in this state:
(a) A writ of attachment may be issued and no bond or affidavit prior to its issuance shall be required.
(b) The records of the commission shall be prima facie evidence of the determination of the amount of the delinquency.
284-A:10 Rules. The commission shall adopt rules, under RSA 541-A, relative to:
I. Methods of identification of casino employees.
II. The manner and method of collection of revenue under this chapter.
III. The games and devices permitted, and the method of operation of such games and devices.
IV. The practice of extending credit to patrons, including the authority to limit the circumstances and amount of credit.
V. Standards for exclusion or ejection of persons from the casino.
VI. Internal fiscal procedures and periodic financial reports.
VII. Security procedures used in the operation of the casino.
VIII. Application and licensing fees and forms.
IX. Any other matter necessary for the administration of a casino.
284-A:11 Financial Reports; Internal Fiscal Procedures.
I. The commission shall by rule require periodic financial reports and shall:
(a) Specify standard forms for reporting financial condition, results of operations, and other relevant information.
(b) Formulate a uniform code of accounts and accounting classifications to assure consistency, comparability, and effective disclosure of all financial information.
(c) Determine the intervals at which such information shall be furnished.
(d) Require audits of the financial statements which shall be made not less frequently than once each year.
II. The commission shall by rule prescribe minimum procedures to be followed in the exercise of effective control over its internal fiscal affairs including, but not limited to:
(a)(1) The safeguarding of assets and revenues, and the recording of cash and evidences of indebtedness. No credit shall be extended on behalf of the casino to any patron without a written memorandum of credit. Such memorandum shall be filed with the daily receipts and preserved until satisfied or canceled pursuant to rules of the commission.
(2) No casino employee shall extend credit or favors to any member of the general court, any appointed or elected state official, or any member of the family of such member of the general court or official, in any manner different than credits or favors that are extended to the general public.
(3) Violation of this subparagraph shall be a class B misdemeanor.
(b) The adoption and use of internal audits, whether by qualified internal auditors or by accountants holding a license to practice public accounting.
284-A:12 Conduct Prohibited.
I. It shall be unlawful for any person:
(a) To deal, operate, carry on, conduct, maintain, or expose for play in the state of New Hampshire any game or slot machine as defined in this chapter, except as provided by this chapter and rules adopted by the commission pursuant to this chapter, and except as provided for entertainment purposes.
(b) To receive, directly or indirectly, any compensation, reward, or any percentage or share of the money or property played for keeping, running, or carrying on any game or slot machine except under the provisions of this chapter, except that dealer tips are permitted.
II. It shall be unlawful for any person to lend, let, lease, or otherwise deliver or furnish any service including service in managing the casino, or any equipment for any gambling game including slot machines, for any interest or any percentage or share of the money or property played for with respect to such equipment, or for any interest however defined in the revenues, profits, or earnings of the casino, other than pursuant to the terms of a written agreement, which agreement shall not be effective unless approved by the commission.
284-A:13 Agreements; Prohibition.
I. The commission may require an application for approval of any agreement regarding the realty of, or any business or person doing business on the premises of the casino, in order that the commission may determine whether said agreement or person should be approved to be associated with the casino in accordance with this chapter. If the commission does not approve such an application, the commission shall require the termination of such association. Any agreement which entitles a business other than a casino to be conducted on such premises shall be subject to commission approval of the business or of any person associated with the business. Every such agreement shall be deemed to include a provision for its termination without liability on the part of the business, if the commission disapproves of the business or of any other person associated with the business, by reason of a finding that the business or person is unsuitable to be associated with the casino. Failure to expressly include such a condition in the agreement shall not constitute a defense in any action brought to terminate the agreement.
II. It shall be unlawful for any person to sell, purchase, lease, assign, hypothecate, borrow, or loan money upon, or create a voting trust agreement or any other agreement of any sort with respect to the casino, except in accordance with the rules of the commission.
284-A:14 Distribution of Revenues. Twenty percent of the annual gross revenue, after expenses of the executive director under RSA 284-A:2 are subtracted, shall be deposited in the general fund.
284-A:15 Prohibited Acts.
I. Any person who knowingly fails to report, pay, or truthfully account for and pay over any revenue received under this chapter, or who knowingly attempts in any manner to evade or defeat such payments shall be guilty of a class A misdemeanor, and shall in addition be liable for a fine in the same amount as the revenue owed, paid, collected, or paid over subject to the maximum fine amounts set forth in RSA 651:2, IV.
II.(a) No person shall permit any gambling game, slot machine or device to be conducted, operated, dealt, or carried on in the casino by a person other than by a person employed under this chapter and any gaming device, slot machine, or related equipment used contrary to this paragraph shall be seized by appropriate state and local enforcement authorities.
(b) No games or slot machines shall be put into play or displayed without the authority of the commission.
(c) No person shall work as a casino employee without obtaining a casino work permit.
(d) Any person who violates this paragraph shall be fined pursuant to RSA 651:2, IV, and shall have any gaming device, slot machine, or related equipment seized by appropriate state and local enforcement authorities.
III. Any person with 2 or more violations of paragraph II within a 2-year period shall be guilty of a class B felony.
284-A:16 Cheating; Penalty.
I. No person playing a gambling game at the casino shall:
(a) Use bogus or counterfeit chips, or substitute and use in any such game cards or dice that have been marked, loaded, or tampered with.
(b) Employ or have on their person any device to facilitate cheating in such games.
II. It shall be unlawful for any person playing or using a slot machine designed to receive or be operated by legal tender of the United States of America:
(a) To knowingly use any tender other than legal tender of the United States of America, or to use coin not of the same denomination as the coin intended to be used in such slot machine, except that in the playing of any slot machine it shall be lawful for any person to use tokens or similar objects which are approved by the commission.
(b) To use any cheating or thieving device, including but not limited to tools, drills, wires, coins attached to strings or wires, or electronic or magnetic devices, to facilitate the alignment of any winning combination or removing money or other contents from any slot machine.
III. It shall be unlawful for any person, except a duly authorized employee of the casino acting in furtherance of such employee’s scope of employment, to have on his or her person or in his or her possession while on the premises of the casino, any cheating or thieving device, including but not limited to tools, wires, drills, coins attached to strings or wires, or electronic or magnetic devices to facilitate removing money or other contents from any slot machine.
IV. It shall be unlawful for any person, except a duly authorized employee of the casino acting in furtherance of such employee’s scope of employment, to have on his or her person or in his or her possession while on the premises of the casino any key or device known to have been designed for the purpose of and suitable for opening or entering any slot machine or drop box.
V. It shall be unlawful:
(a) To conduct, carry on, operate, deal or allow to be conducted, carried on, operated, or dealt any cheating or thieving game or device.
(b) To deal, conduct, carry on, operate, or expose for play any game or games played with cards, dice or any mechanical device, or any combination of games or devices, which have in any manner been marked or tampered with, or placed in a condition, or operated in a manner, the result of which tends to deceive the public or tends to alter the normal random selection of criteria which determine the result of a game.
(c) To use or possess any marked cards, loaded dice, plugged or tampered-with machines or devices.
VI. Any person who violates this section shall be guilty of a class B felony.
284-A:17 Minors Prohibited; Penalty. No person under 21 years of age shall be employed by or allowed to enter the casino. Any casino employee who knowingly allows a minor to enter the casino shall be guilty of a violation, provided, however, that the following facts established by a person allowing any such minor to enter the casino shall constitute an affirmative defense:
I. The minor falsely represented that such minor was 21 years of age or older.
II. The appearance of the minor was such that an ordinary prudent person would believe the minor to be 21 years of age or older.
III. Admittance was made in good faith, relying upon such written representation and appearance, and in reasonable belief that the minor was actually 21 years of age or older.
284-A:18 Declaration of Limited Exemption from Operation of Provisions of 15 U.S.C. section 1172. Pursuant to section 2 of an act of Congress of the United States entitled “An act to prohibit transportation of gambling devices in interstate and foreign commerce”, approved January 2, 1951, being Chapter 1194, 64 Stat. 1134, and also designated as 15 U.S.C. sections 1171-1177, the state of New Hampshire, acting by and through the duly elected and qualified members of its legislature, does hereby, in accordance with and in compliance with the provisions of section 2 of that act of Congress, declare and proclaim that section 2 of that act of Congress shall not apply to any gambling device in this state where the transportation of such a device is specifically authorized by and done in compliance with the provisions of this chapter and any rules adopted pursuant to it, and that any such gambling device transported in compliance with state law and rules shall be exempt from the provisions of that act of Congress.
284-A:19 Legal Shipment of Gaming Devices into New Hampshire. All shipments of gaming devices into this state, the registering, recording, and labeling of which has been duly had by the manufacturer or dealer in accordance with sections 3 and 4 of an act of Congress of the United States entitled “An act to prohibit transportation of gambling devices in interstate and foreign commerce, approved January 2, 1951, being chapter 1194, 64 Stat. 1134, and also designated as 15 U.S.C. sections 1171-1177, shall be deemed legal shipments into this state.
2 Compensation of State Officers; Salaries. Amend RSA 94:1-a, I by inserting in grade II:
Lottery commission executive director, resort and casino.
3 New Subparagraph; Resort and Casino Not Prohibited. Amend RSA 647:2, V by inserting after subparagraph (c) the following new subparagraph:
(d) A resort and casino established under RSA 284-A.
4 Effective Date. This act shall take effect July 1, 2005.
LBAO
05-0709
Revised 2/15/05
HB 685 FISCAL NOTE
AN ACT permitting casino gambling.
FISCAL IMPACT:
The Lottery Commission indicates this bill will increase state general fund revenue and state restricted expenditures by an indeterminable amount in FY 2007 and each year thereafter. The Department of Justice indicates this bill will increase state general fund expenditures by $45,500 in FY 2007, $46,865 in FY 2008, and $48,271 in FY 2009. There will be no fiscal impact on county and local revenue or expenditures.
METHODOLOGY:
The Lottery Commission states this bill establishes new responsibilities for the Commission as listed below:
• Hire an executive director
• Responsible for the administration of the casino chapter and enforcement of rules.
• Participate in the selection of suitable and qualified casino developer
• Regulate casino operations
• Collect and administer revenue
• Investigate any transaction for which commission approval is needed
• Observe conduct of all persons having a material involvement with the operation or management of the casino and to ensure all persons involved in the management of the casino are suitable.
• Negotiate period of operation and location of casino
• Select operator of casino
• Inspect premises of casino
• Inspect all equipment and supplies
• Seize and remove equipment and supplies if necessary
• Inspect books showing receipt and disbursements.
• Seize and impound any book, record, ledger, game, device, cash box, counting room or casino operations.
• Inspect casino during operation and certify accuracy of money and vouchers received by casino.
• Adopt rules relative to casino operations and casino financial reporting
The Commission indicates the cost to discharge the new responsibilities is unknown. Employees and consultants will have to be hired but their number and costs cannot be estimated.
The Commission states this bill requires that 20% of annual gross revenue, after expenses of the executive director are subtracted, shall be deposited in the general fund. The Commission cannot estimate the amount of annual gross revenue, and therefore, the amount that will be deposited into the general fund. The revenue will depend on the types of games and the level of activity. The Commission states that slot machine income is estimated at $295 per machine per day.
The Department of Justice estimates it will require the services of one part-time attorney to fulfill its responsibilities as outlined in this bill. The Department expects it will pay $45,500 in FY 2007, $46,865 in FY 2008 and $48,271 in FY 2009 for salary and benefits for the attorney who will work half time.