HB 229 – AS AMENDED BY THE SENATE
27Mar2007… 0917h
06/07/07 2025s
06/07/07 2067s
2007 SESSION
08/04
HOUSE BILL 229
AN ACT relative to licensing requirements for operators of games of chance.
SPONSORS: Rep. Jasper, Hills 27
COMMITTEE: Executive Departments and Administration
This bill:
I. Expands the definition of “charitable organization” for the purposes of games of chance.
II. Expands the information about a game operator that must be submitted to the pari-mutuel commission.
III. Makes certain changes to rules of licensure for operators of games of chance.
IV. Repeals a tax expiration provision relative to Rockingham Park.
V. Establishes the positions of supervisor II and internal auditor III in the pari-mutuel commission.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
27Mar2007… 0917h
06/07/07 2025s
06/07/07 2067s
07-0823
08/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Seven
AN ACT relative to licensing requirements for operators of games of chance.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Ice Outs. Amend RSA 287-D:1, II to read as follows:
II. “Games of chance” means any game involving gambling as defined by RSA 647:2, II, or any lottery prohibited by RSA 647:1, but shall not include any game involving the use of a slot machine or any other device in the nature of a slot machine, or 50/50 raffles as defined in RSA 287-A:1, III[, or ice-out contests as defined in RSA 287-D:1, IV].
2 Charitable Organization; Definition. Amend the introductory paragraph of RSA 287-D:1, III(a) to read as follows:
(a) “Charitable organization” means any bona fide religious, charitable, civic, social, business league, veterans’, or fraternal or church organization, including police and firemen’s organizations which shall have been registered with the secretary of state for at least 2 years and in existence for at least 2 years in a town or city in this state, provided that the primary activities conducted by the organization were for the purpose for which the organization was established and have not included charitable gambling operations; which [is organized under the laws of this state; and to which contributions are exempt from federal income tax] possesses a tax exempt status under Internal Revenue Code section 501(c)(3), 501(c)(4), 501(c)(6), 501(c)(7), 501(c)(8), 501(c)(10), or 501(c)(19), or is covered under a group ruling issued by the Internal Revenue Service under authority of those sections. To be eligible for licensure under this chapter, a charitable organization shall do all of the following:
3 New Paragraph; Ice Outs. Amend RSA 287-D:2 by inserting after paragraph VI the following new paragraph:
VII. The requirements of this chapter shall not apply if the only game being conducted by the charitable organization is an ice-out contest.
4 License Applications. Amend RSA 287-D:2-a, V(c) to read as follows:
(c) That neither the applicant nor any person who will be participating in the operation of the games of chance has been convicted of a felony or a class A misdemeanor within the previous 10 years which has not been annulled by a court, or a class B misdemeanor [involving falsehood or dishonesty] within the previous 5 years which has not been annulled by a court, or has violated any statutes or rules governing charitable gambling in New Hampshire or any other state.
5 License Applications; Charitable Organizations. Amend RSA 287-D:2-a, VI to read as follows:
VI. If a charitable organization intends to use, lease, or rent premises for the conduct of any game of chance from an entity other than a charitable organization or governmental subdivision, the entity leasing or renting out or otherwise allowing a charitable organization to use the premises shall be licensed by the pari-mutuel commission. Any entity other than a charitable organization or governmental subdivision with a facility at which games of chance are held for no more than 3 game dates per calendar year shall be exempt from the licensing requirement of this paragraph. The license shall be applied for by filing an application supplied by the pari-mutuel commission. The pari-mutuel commission may issue a license for a period of one year which shall expire on June 30 of each year unless sooner revoked or suspended for just cause by the pari-mutuel commission.
6 New Paragraph; License Applications. Amend RSA 287-D:2-a by inserting after paragraph IX the following new paragraph:
X. At least 45 days prior to each game date, the charitable organization shall submit the date and location of the game of chance, if this information has not already been submitted to the pari-mutuel commission pursuant to subparagraph II(a).
7 License Applications. Amend RSA 287-D:2-b, II-IV to read as follows:
II. No compensation shall be paid to operators of a game of chance unless agreed to in advance in writing by the charity. Compensation shall include, but is not necessarily limited to, money or any other thing of value. [If the paid game operator’s compensation is contingent upon the amount of revenue received from a game of chance, the compensation shall be a fixed percentage of the gross revenue from the game of chance excluding the paid game operator’s expenses. If the compensation of a paid game operator is not contingent upon the amount of revenue received, the compensation shall be a reasonable estimate, expressed as a percentage of the gross revenue. The contract shall clearly disclose the assumptions upon which the estimate is based. The stated assumptions shall be based upon all of the relevant facts known to the paid game operator regarding the services to be provided and the past performance of games of chance operated by the paid game operator.]
II-a. Unless otherwise agreed to in advance, pursuant to paragraph II, in writing by the charitable organization, operators of games of chance may be reimbursed for their out-of-pocket expenses in an amount not to exceed $25 per game date, provided that such expenses are itemized and submitted in writing to the charitable organization.
III. No one under the age of 18 years shall be admitted to the premises on which games of chance are being conducted, except when the games are being conducted at a carnival. Proof of age shall be produced upon request of the [lottery] pari-mutuel commission. When games of chance are conducted at a carnival, persons under the age of 18 years may be admitted to the premises on which the games are being conducted when accompanied and supervised by a parent or legal guardian; but persons under the age of 18 shall not be permitted to play games of chance at a carnival.
IV. No games of chance shall be conducted prior to 11:00 a.m. on a weekday or Saturday, prior to noon on a Sunday, or after 1:00 a.m. on any day.
8 Operation of Games of Chance. Amend RSA 287-D:2-b, VII to read as follows:
VII. Only the treasurer of the charitable organization or a bona fide member of the charitable organization designated by the treasurer, shall [handle] be responsible for any monetary transactions related to the game of chance when the charitable organization does not use the services of a game operator licensed pursuant to RSA 287-D:2-c.
9 Licensing of Game Operators. Amend RSA 287-D:2-c, I to read as follows:
I. As used in this section, game operators means any consultant or any person other than a bona fide member of the charitable organization involved in conducting, managing, supervising, directing, or running the games of chance, and those involved in such tasks as dealing, running a roulette wheel, or handling chips[, and serving beverages or food].
10 Licensing of Game Operators. Amend RSA 287-D:2-c, II(a) to read as follows:
(a) The name and social security number of the game operator or for an organization the name and federal tax identification number. The pari-mutuel commission shall not disclose any social security number submitted.
11 Licensing of Game Operators. Amend RSA 287-D:2-c, III(b) to read as follows:
(b) Has submitted a background and criminal record check pursuant to RSA 287-D:8; and
12 Equipment; Inspection. Amend RSA 287-D:3, II-VII to read as follows:
II. Any and all devices and equipment used to conduct said games of chance shall be subject to inspection by duly authorized law enforcement or pari-mutuel officials.
III. No mechanism or device, which can be used to regulate odds, will be permitted to operate said games of chance and no progression in any form shall be permitted in the operation of any such game.
IV. A player of any game of chance and only a player shall activate any and all devices used for the purposes of wagering on said games of chance.
V. No single wager by a player, on any game of chance, where chips have monetary value, shall exceed the amount of [$2] $5.
VI. [Any contract for the rental of a facility for a game of chance shall be independent of any contract for the rental of equipment. Those contracts shall not be contingent upon the charitable organization’s agreement that it will contract with a particular business for a particular facility or equipment.
VII. A charitable organization shall only rent a facility by means of a fixed rental payment. The fixed rental payment shall not be based on a percentage of what the charitable organization receives from the game of chance and it shall reflect fair rental value of the property for any use not just as a place to hold a game of chance. Any rental entered into by the charitable organization shall be submitted with the charitable organization’s license application for review by the pari-mutuel commission.
VIII. The charitable organization shall retain no less than 35 percent of the gross revenues from any game of chance minus any prizes paid on any game date in which game operators licensed under RSA 287-D:2-c are involved in any capacity.] In games where chips have no monetary value, a minimum of 6 percent of the first $25,000 and a minimum of 8.75 percent of all funds exceeding $25,000 collected from players on each game date in which game operators are involved in any capacity shall be retained by the charity. The money retained by the charity shall not be used for any expenses associated with the operation of the games of chance. Such revenues shall be used by the organization to advance its charitable purpose.
VII. In games where chips have no monetary value, 1.25 percent of all funds collected from players shall be paid to the state treasurer to be deposited into the education trust fund. Such payments must be made within 5 business days of the game date the funds were collected.
VIII. In games where chips do have monetary value, the charity shall retain not less than 35 percent of rake or house winnings. The money retained by the charity shall not be used for any expenses associated with the operation of games of chance. Such revenues shall be used by the organization to advance its charitable purpose.
IX. In games where chips do have monetary value, 5 percent of rake or house winnings and other monies collected by the game operator that are not paid out as prizes to players shall be paid to the state treasurer for deposit into the education trust fund. Such payments shall be made within 5 business days of the game date the funds were collected.
13 License Fees and Specifications. Amend RSA 287-D:2-d, I to read as follows:
I. An applicant for a charitable organization license under RSA 287-D:2-a shall apply to the pari-mutuel commission, and upon payment of a fee of $25 per game date and if the applicant meets all other requirements of this chapter, a license shall be issued. Only one license shall be issued to each applicant per year to operate games of chance for 10 days, which 10 days need not be consecutive. A charitable organization that has been licensed for and played 10 game dates in a calendar year and whose total retained revenue from all those game dates is less than $50,000 may apply to the pari-mutuel commission for additional game dates. The pari-mutuel commission may approve up to 5 additional game dates for the same calendar year for the sole purpose of allowing the charitable organization to have the opportunity for additional revenue on those game dates to reach a total retained revenue amount of $50,000 for all game dates. The charitable organization shall pay a fee of $25 for each additional game date authorized by the commission. A license issued under RSA 287-D:2-a shall expire on December 31. The pari-mutuel commission shall notify the attorney general and police chief of any city or town where games of chance are held of any applications approved.
14 Background and Criminal Records Check. Amend RSA 287-D:8, III to read as follows:
III. All applicants shall also be subject to a national criminal background check, including the submission of fingerprints to the Federal Bureau of Investigation for a criminal history background check, by the pari-mutuel commission to determine if they are eligible for licensure under this chapter.
15 New Paragraph; Background and Criminal Records Check. Amend RSA 287-D:8 by inserting after paragraph III the following new paragraph:
IV. The pari-mutuel commission shall bill the applicant for any cost associated with the criminal or background record check to cover any fee charged by the department of safety for the criminal records check in paragraph I or by the Federal Bureau of Investigation for the background check in paragraph III.
16 License Applications; Charitable Organizations. Amend RSA 287-D:2-a, II(f) to read as follows:
(f) If any of the proposed games are to be held in a location licensed pursuant to RSA 287-D:2-a, VI, the name and address of the person or business from whom the space is being rented or permission for use has been granted.
17 Reporting Date Extended. Amend 2006, 311:16, V to read as follows:
V. The games of chance study commission shall report its findings and any recommendations for proposed legislation to the speaker of the house of representatives, the president of the senate, the house clerk, the senate clerk, the governor, the chairman of the senate ways and means committee, the chairman of the house executive departments and administration committee, and the state library on or before [July 1, 2007] November 1, 2007.
18 Licensing of Game Operators. Amend RSA 287-D:2-c, V to read as follows:
V. The game operator or the game operator’s employer shall submit a [$20,000] bond conditioned upon the game operator running games of chance in conformity with this chapter and with the rules and regulations prescribed by the commission, in the amount of up to $100,000 to the pari-mutuel commission with the application form. The pari-mutuel commission shall adopt rules pursuant to RSA 541-A to specify the amount of the bond and requirements of the bond.
VI. Game operators who operate games of chance on behalf of a charitable organization shall be held responsible for all requirements that the charitable organization would otherwise be responsible for if they were operating the games of chance themselves.
19 License Fees and Specifications; New Paragraph. Amend RSA 287-D:2-d by inserting after paragraph VI the following new paragraph:
VII. Any game operator licensed pursuant to RSA 287-D:2-c shall be issued, as part of the yearly license, an identification badge by the pari-mutuel commission. The fee for such badge shall be established by the commission. The commission shall adopt rules pursuant to RSA 541-A to specify badge requirements.
20 New Paragraphs; Penalties. Amend RSA 287-D:6 by inserting after paragraph III the following new paragraphs:
IV. The commission may issue an order requiring any person or organization, to comply with this subdivision or any rule adopted hereunder, and may require such remedial measures as may be necessary.
V. The commission may impose an administrative fine scaled to reflect the violator’s prior history and the scope and severity of the violation, after notice and hearing, pursuant to rules adopted under RSA 541-A, for any violation of this subdivision, any rule adopted under this subdivision, any license issued pursuant to this chapter or any order issued pursuant to this subdivision, or upon any person who makes or certifies a material, false statement relative to any application or report required by this subdivision. Any administrative fine imposed under this paragraph shall not preclude the imposition of other penalties under this chapter. Rehearings and appeals from a decision of the commission under this paragraph shall be in accordance with RSA 541. Fines imposed by the commission shall be determined based on the following:
(a) For a minor deviation from a requirement, the fine shall be not less than $25 and not more than $1,500 per violation.
(b) For a moderate deviation from a requirement, the fine shall be not less than $100 and not more than $2,500 per violation.
(c) For a major deviation from a requirement, the fine shall be not less than $250 and not more than $5,000 per violation.
(d) For repeat violations, the commission may assess an additional fine.
VI. All fines imposed by the commission shall be deposited in the fund established pursuant to RSA 284:21-j.
21 New Subparagraph; Bank Accounts. Amend RSA 287-D:2-c, II by inserting after subparagraph (h) the following new subparagraph:
(g) The name of the financial institution with at least one branch in New Hampshire and the corresponding bank account number for the account in which money from the game of chance will be deposited and withdrawn.
22 New Paragraph; Bank Accounts. Amend RSA 287-D:2-c by inserting after paragraph V the following new paragraph:
VI. To be eligible for licensure under this chapter, a licensed game operator shall maintain an account at a financial institution with at least one branch in New Hampshire solely in the name of the licensed game operator in which the money from games of chance shall be deposited and withdrawn.
23 Operation of Games. RSA 284-D:2-b, VIII is repealed and reenacted to read as follows:
VIII.(a) On game dates where the charitable organization operates the games, the charitable organization shall deposit cash and proceeds from a game of chance into the account required by RSA 287-D:2-a, VII(e). All expenses, including prizes of more than $500 and equipment and hall rental fees shall be paid by check from the account required by RSA 287-D:2-a, VII(e). The treasurer of the charitable organization shall document all prizes awarded as prescribed in rules adopted by the pari-mutuel commission.
(b) On game dates where the licensed game operator operates the games, the licensed game operator shall deposit cash and proceeds from a game of chance into the account required by RSA 287-D:2-c, VI. All expenses, including prizes of more than $500 and equipment and hall rental fees shall be paid by check from the account required by RSA 287-D:2-c, VI. The licensed game operator shall document all prizes awarded as prescribed in rules adopted by the pari-mutuel commission.
24 Pari-Mutuel Commission; Positions Established. The following classified positions are hereby established in the pari-mutuel commission:
I. One internal auditor III, labor grade 23.
II. One supervisor II, labor grade 21.
25 Repeal. The following are repealed:
I. RSA 287-D:2-b, XIII, relative to relative to submission of information to the pari-mutuel commission.
II. RSA 287-D:2-d, IV, relative to authorization of specific games.
III. RSA 284:23, V, relative to tax rates for Rockingham Park.
26 Effective Date.
I. RSA 287-D:2-b, II as inserted by section 7 of this act, and RSA 287-D:2-c, V as inserted by section 18 of this act shall take effect January 1, 2008.
II. Sections 8, 12, 13, 21, 22, and 23 of this act shall take effect January 1, 2008.
III. The remainder of this act shall take effect 60 days after its passage.