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AN ACT

RELATING TO GAMING; DEFINING TECHNICIANS THAT REPAIR AND

SERVICE GAMING DEVICES OR ASSOCIATED EQUIPMENT; TRANSFERRING

RESPONSIBILITY FOR APPROVAL OF TECHNICIANS TO THE GAMING

CONTROL BOARD FROM MANUFACTURER LICENSEES; DECLARING AN

EMERGENCY.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 60-2E-3 NMSA 1978 (being Laws 1997,

Chapter 190, Section 5, as amended) is amended to read:

"60-2E-3. DEFINITIONS.--As used in the Gaming Control

Act:

A. "affiliate" means a person who, directly or

indirectly through one or more intermediaries, controls, is

controlled by or is under common control with a specified

person;

B. "affiliated company" means a company that:

(1) controls, is controlled by or is under

common control with a company licensee; and

(2) is involved in gaming activities or

involved in the ownership of property on which gaming is

conducted;

C. "applicant" means a person who has applied for

a license or for approval of an act or transaction for which

approval is required or allowed pursuant to the provisions of

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the Gaming Control Act;

D. "application" means a request for the issuance

of a license or for approval of an act or transaction for

which approval is required or allowed pursuant to the

provisions of the Gaming Control Act, but "application" does

not include a supplemental form or information that may be

required with the application;

E. "associated equipment" means equipment or a

mechanical, electromechanical or electronic contrivance,

component or machine used in connection with gaming activity;

F. "board" means the gaming control board;

G. "certification" means a notice of approval by

the board of a person required to be certified by the board;

H. "company" means a corporation, partnership,

limited partnership, trust, association, joint stock company,

joint venture, limited liability company or other form of

business organization that is not a natural person; "company"

does not mean a nonprofit organization;

I. "distributor" means a person who supplies

gaming devices to a gaming operator but does not manufacture

gaming devices;

J. "equity security" means an interest in a

company that is evidenced by:

(1) voting stock or similar security;

(2) a security convertible into voting stock

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or similar security, with or without consideration, or a

security carrying a warrant or right to subscribe to or

purchase voting stock or similar security;

(3) a warrant or right to subscribe to or

purchase voting stock or similar security; or

(4) a security having a direct or indirect

participation in the profits of the issuer;

K. "executive director" means the chief

administrative officer appointed by the board pursuant to

Section 60-2E-7 NMSA 1978;

L. "finding of suitability" means a certification

of approval issued by the board permitting a person to be

involved directly or indirectly with a licensee, relating

only to the specified involvement for which it is made;

M. "game" means an activity in which, upon payment

of consideration, a player receives a prize or other thing of

value, the award of which is determined by chance even though

accompanied by some skill; "game" does not include an

activity played in a private residence in which no person

makes money for operating the activity except through

winnings as a player;

N. "gaming" means offering a game for play;

O. "gaming activity" means an endeavor associated

with the manufacture or distribution of gaming devices or the

conduct of gaming;

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P. "gaming device" means associated equipment or a

gaming machine and includes a system for processing

information that can alter the normal criteria of random

selection that affects the operation of a game or determines

the outcome of a game;

Q. "gaming employee" means a person connected

directly with a gaming activity; "gaming employee" does not

include:

(1) bartenders, cocktail servers or other

persons engaged solely in preparing or serving food or

beverages;

(2) secretarial or janitorial personnel;

(3) stage, sound and light technicians; or

(4) other nongaming personnel;

R. "gaming establishment" means the premises on or

in which gaming is conducted;

S. "gaming machine" means a mechanical,

electromechanical or electronic contrivance or machine that,

upon insertion of a coin, token or similar object, or upon

payment of any consideration, is available to play or operate

a game, whether the payoff is made automatically from the

machine or in any other manner;

T. "gaming operator" means a person who conducts

gaming;

U. "holding company" means a company that directly

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or indirectly owns or has the power or right to control a

company that is an applicant or licensee, but a company that

does not have a beneficial ownership of more than ten percent

of the equity securities of a publicly traded corporation is

not a holding company;

V. "immediate family" means natural persons who

are related to a specified natural person by affinity or

consanguinity in the first through the third degree;

W. "independent administrator" means a person who

administers an annuity, who is not associated in any manner

with the gaming operator licensee for which the annuity was

purchased and is in no way associated with the person who

will be receiving the annuity;

X. "institutional investor" means a state or

federal government pension plan or a person that meets the

requirements of a qualified institutional buyer as defined in

Rule 144A of the federal Securities Act of 1933, and is:

(1) a bank as defined in Section 3(a)(6) of

the federal Securities Exchange Act of 1934;

(2) an insurance company as defined in

Section 2(a)(17) of the federal Investment Company Act of

1940;

(3) an investment company registered under

Section 8 of the federal Investment Company Act of 1940;

(4) an investment adviser registered under

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Section 203 of the federal Investment Advisers Act of 1940;

(5) collective trust funds as defined in

Section 3(c)(11) of the federal Investment Company Act of

1940;

(6) an employee benefit plan or pension fund

that is subject to the federal Employee Retirement Income

Security Act of 1974, excluding an employee benefit plan or

pension fund sponsored by a publicly traded corporation

registered with the board; or

(7) a group comprised entirely of persons

specified in Paragraphs (1) through (6) of this subsection;

Y. "intermediary company" means a company that:

(1) is a holding company with respect to a

company that is an applicant or licensee; and

(2) is a subsidiary with respect to any

holding company;

Z. "key executive" means an executive of a

licensee or other person having the power to exercise

significant influence over decisions concerning any part of

the licensed operations of the licensee or whose compensation

exceeds an amount established by the board in a rule;

AA. "license" means an authorization required by

the board for engaging in gaming activities;

BB. "licensee" means a person to whom a valid

license has been issued;

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CC. "manufacturer" means a person who

manufactures, fabricates, assembles, produces, programs or

makes modifications to any gaming device for use or play in

New Mexico or for sale, lease or distribution outside New

Mexico from any location within New Mexico;

DD. "net take" means the total of the following,

less the total of all cash paid out as losses to winning

patrons and those amounts paid to purchase annuities to fund

losses paid to winning patrons over several years by

independent administrators:

(1) cash received from patrons for playing a

game;

(2) cash received in payment for credit

extended by a licensee to a patron for playing a game; and

(3) compensation received for conducting a

game in which the licensee is not a party to a wager;

EE. "nonprofit organization" means:

(1) a bona fide chartered or incorporated

branch, lodge, order or association, in existence in New

Mexico prior to January 1, 1997, of a fraternal organization

that is described in Section 501(c)(8) or (10) of the federal

Internal Revenue Code of 1986 and that is exempt from federal

income taxation pursuant to Section 501(a) of that code; or

(2) a bona fide chartered or incorporated

post, auxiliary unit or society of, or a trust or foundation

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for the post or auxiliary unit, in existence in New Mexico

prior to January 1, 1997, of a veterans' organization that is

described in Section 501(c)(19) or (23) of the federal

Internal Revenue Code of 1986 and that is exempt from federal

income taxation pursuant to Section 501(a) of that code;

FF. "person" means a legal entity;

GG. "premises" means land, together with all

buildings, improvements and personal property located on the

land;

HH. "progressive jackpot" means a prize that

increases over time or as gaming machines that are linked to

a progressive system are played and upon conditions

established by the board may be paid by an annuity;

II. "public post-secondary educational

institution" means an institution designated in Article 12,

Section 11 of the constitution of New Mexico and an

institution designated in Chapter 21, Articles 13, 14 and 16

NMSA 1978;

JJ. "progressive system" means one or more gaming

machines linked to one or more common progressive jackpots;

KK. "publicly traded corporation" means a

corporation that:

(1) has one or more classes of securities

registered pursuant to the securities laws of the United

States or New Mexico;

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(2) is an issuer subject to the securities

laws of the United States or New Mexico; or

(3) has one or more classes of securities

registered or is an issuer pursuant to applicable foreign

laws that, the board finds, provide protection for

institutional investors that is comparable to or greater than

the stricter of the securities laws of the United States or

New Mexico;

LL. "registration" means a board action that

authorizes a company to be a holding company with respect to

a company that holds or applies for a license or that relates

to other persons required to be registered pursuant to the

Gaming Control Act;

MM. "subsidiary" means a company, all or a part of

whose outstanding equity securities are owned, subject to a

power or right of control or held, with power to vote, by a

holding company or intermediary company;

NN. "technician" means a person approved by the

board to repair and service gaming devices or associated

equipment but who is prohibited from programming gaming

devices; and

OO. "work permit" means a card, certificate or

permit issued by the board, whether denominated as a work

permit, registration card or otherwise, authorizing the

employment of the holder as a gaming employee."

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Section 2. Section 60-2E-13 NMSA 1978 (being Laws 1997,

Chapter 190, Section 15, as amended) is amended to read:

"60-2E-13. ACTIVITIES REQUIRING LICENSING.--

A. A person shall not conduct gaming unless the

person is licensed as a gaming operator.

B. A person shall not sell, supply or distribute a

gaming device or associated equipment for use or play in this

state or for use or play outside of this state from a

location within this state unless the person is licensed as a

distributor or manufacturer, but a gaming operator licensee

may sell or trade in a gaming device or associated equipment

to a gaming operator licensee, distributor licensee or

manufacturer licensee.

C. Except as provided in Subsection D of this

section, a person shall not manufacture, fabricate, assemble,

program or make modifications to a gaming device or

associated equipment for use or play in this state or for use

or play outside of this state from any location within this

state unless the person is a manufacturer licensee. A

manufacturer licensee may sell, supply or distribute only the

gaming devices or associated equipment that the manufacturer

licensee manufactures, fabricates, assembles, programs or

modifies.

D. Upon receiving a written request from a person

who manufactures associated equipment, the board may waive

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the requirement for a manufacturer's license on the terms and

conditions the board deems necessary as long as the waiver is

consistent with the purpose of the Gaming Control Act.

E. Except as provided in Section 60-2E-13.1 NMSA

1978, a gaming operator licensee or a person other than a

manufacturer licensee or distributor licensee shall not

possess an unlicensed or illegal gaming device or possess or

control a place where there is an unlicensed or illegal

gaming device. Any unlicensed or illegal gaming device,

except a gaming machine in the possession of a licensee while

awaiting transfer to a gaming operator licensee for licensure

of the machine, or as provided in Section 60-2E-13.1 NMSA

1978, is subject to seizure and forfeiture pursuant to

Section 30-19-10 NMSA 1978.

F. A person shall not service or repair a gaming

device or associated equipment unless the person is licensed

as a manufacturer, is employed by a manufacturer licensee or

is a technician approved by the board and employed by a

distributor licensee or a gaming operator licensee.

G. A person shall not engage in an activity for

which the board requires a license or permit without

obtaining the license or permit.

H. Except as provided in Subsections B and D of

this section, a person shall not purchase, lease or acquire

possession of a gaming device or associated equipment except

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from a distributor licensee or manufacturer licensee.

I. A distributor licensee may receive a percentage

of the amount wagered, the net take or other measure related

to the operation of a gaming machine as a payment pursuant to

a lease or other arrangement for furnishing a gaming machine,

but the board shall adopt a regulation setting the maximum

allowable percentage."

Section 3. EMERGENCY.--It is necessary for the public

peace, health and safety that this act take effect

immediately.