0001|                         HOUSE BILL 346
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0002|     42ND LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION,
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0003|     1996
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0004|                         INTRODUCED BY
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0005|                        VINCENT GALLEGOS
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0006|     
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0007|     
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0008|     
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0009|     
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0010|     
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0011|                             AN ACT
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0012|     RELATING TO GAMES OF CHANCE; ENACTING THE VIDEO GAMING ACT;
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0013|     ESTABLISHING PROCEDURES; PRESCRIBING PENALTIES; IMPOSING TAXES
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0014|     AND FEES; PERMITTING VERTICAL INTEGRATION OF CERTAIN LICENSEES;
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0015|     PROVIDING FOR A CERTAIN LOCAL OPTION; MAKING APPROPRIATIONS.
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0016|     
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0017|     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0018|       Section 1.  SHORT TITLE.--Sections 1 through 22 of this act
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0019|     may be cited as the "Video Gaming Act."
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0020|       Section 2.  PURPOSE.--The purpose of the Video Gaming Act
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0021|     is to combat the growth of illegal gaming through the
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0022|     establishment of a regulated system of video games of chance. 
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0023|     The legislature finds that:
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0024|            A.  the technology now exists to provide a secure
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0025|     system of regulated gaming;
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0001|            B.  this system will:
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0002|                 (1)  offer fair play and return to consumers who
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0003|     use the system;
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0004|                 (2)  provide needed revenue to the state and its
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0005|     political subdivisions;
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0006|                 (3)  provide additional entertainment to attract
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0007|     tourists and increase their length of stay; and
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0008|                 (4)  provide additional jobs for the citizens of
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0009|     New Mexico.
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0010|       Section 3.  DEFINITIONS.--As used in the Video Gaming Act:
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0011|            A.  "age controlled environment" means a location, or
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0012|     portion of a location, licensed for the on premises consumption
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0013|     of spirituous liquors and the interior of which is not
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0014|     observable by any individual under the age of twenty-one years.
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0015|     No individual under the age of twenty-one years may be employed
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0016|     to work in the age controlled environment;
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0017|            B.  "application" means the forms and schedules
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0018|     prescribed by the commission upon which an applicant applies for
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0019|     a license or license renewal and includes, but is not limited
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0020|     to, information, disclosure statements and financial statements
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0021|     submitted;
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0022|            C.  "commission" means the video gaming commission;
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0023|            D.  "credit" means the basic unit of a win on a video
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0024|     gaming device which entitles the player to one additional free
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0025|     game at the lowest monetary rate at which one game may be
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0001|     purchased on that device;
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0002|            E.  "financial source" means any person, partnership,
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0003|     trust or corporation that provides credit for capital or
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0004|     operations where the terms of repayment extend for more than
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0005|     ninety days;
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0006|            F.  "gross proceeds" means the total value of money
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0007|     placed in a video gaming device by consumers;
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0008|            G.  "holding a substantial interest" means:
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0009|                 (1)  ownership, operation, management or
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0010|     conducting the business of a proprietorship, directly or
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0011|     indirectly, by an individual or spouse of the individual;
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0012|                 (2)  sharing or being entitled to share in any
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0013|     profits, actual or potential, of a partnership or trust by an
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0014|     individual or spouse of the individual;
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0015|                 (3)  being an officer, director, stockholder or
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0016|     spouse of a stockholder in a corporation which is not publicly
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0017|     traded;
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0018|                 (4)  being the holder, legally or beneficially,
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0019|     of five percent or more of any class of stock or other evidence
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0020|     of ownership of a publicly traded corporation or other public
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0021|     traded entity or being the spouse of such a holder;
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0022|                 (5)  furnishing five percent or more of the
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0023|     capital of any entity.
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0024|       A person holding a substantial interest in any entity shall
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0025|     be deemed to hold a substantial interest in every entity in
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0001|     which the first entity holds a substantial interest;
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0002|            H.  "location agreement" means a written agreement
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0003|     between an operator and the person or entity owning or
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0004|     controlling a licensed premises for the placement of video
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0005|     gaming devices within the location for use by the public.  If
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0006|     the person or entity owns the devices, the person or entity's
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0007|     sworn statement to that effect shall be deemed a location
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0008|     agreement;
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0009|            I.  "manufacturer" means a person or entity which
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0010|     assembles, from subparts or raw materials, a complete video
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0011|     gaming device;
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0012|            J.  "manufacturer's license" means a license issued
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0013|     by the superintendent which authorizes the manufacture and
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0014|     transfer or sale of video gaming devices to an operator;
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0015|            K.  "net proceeds" means the gross proceeds minus all
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0016|     prizes paid out to players of a video gaming device;
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0017|            L.  "operator" means any person or entity who owns,
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0018|     services or maintains video gaming devices, but does not include
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0019|     any person owning or controlling, or holding a substantial
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0020|     interest in an entity which owns or controls, a licensed
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0021|     premises for which there is a location agreement;
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0022|            M.  "operator's license" means a license issued by
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0023|     the superintendent which authorizes a person to engage in the
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0024|     business of an operator;
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0025|            N.  "owner-operator" means any person or entity who
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0001|     owns, services or maintains video gaming devices, owns or leases
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0002|     one premises and is the holder of the premises license where the
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0003|     video gaming devices are located;
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0004|            N.  "parimutuel horseracing facility" means a
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0005|     premises licensed to hold public horseraces or horse meetings
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0006|     for profit or gain;
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0007|            O.  "play" means to activate a video gaming device
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0008|     and to manipulate or work it for the purpose of winning as
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0009|     indicated by the pay-out schedule or accumulating credits to be
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0010|     replayed or to be cashed out of the machine in the form of a
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0011|     printed ticket to be exchanged for cash;
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0012|            P.  "premises license" means a license issued by the
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0013|     superintendent to a person or entity owning or controlling a
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0014|     location and authorizing the placement of video gaming devices
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0015|     at that location for play by the public;
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0016|            Q.  "qualified sleeping unit" means a personal
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0017|     sleeping room rented commercially to guests or transients whose
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0018|     average stay is less than thirty days;
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0019|            R.  "resort" means a location within a resort area
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0020|     having at least one hundred qualified sleeping units, a premises
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0021|     licensed for the consumption of spirituous liquors and a
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0022|     restaurant;
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0023|            S.  "resort area" means a geographical region
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0024|     designated as a resort area by the commission and which is in a
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0025|     local option district in which the local option provisions of
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0001|     the Video Gaming Act have been adopted by the voters;
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0002|            T.  "spirituous liquors" means alcoholic beverages
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0003|     except fermented beverages such as wine, beer and ale;
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0004|            U.  "superintendent" means the superintendent of
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0005|     regulation and licensing; and
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0006|            V.  "video gaming device" means an electronic machine
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0007|     which utilizes a cathode ray tube or video display screen and
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0008|     microprocessors and which is available for consumer play upon
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0009|     payment of specified consideration, with winners immediately
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0010|     determined by the application of the element of chance, whether
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0011|     or not accompanied by an element of skill, and with a reward of
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0012|     possible games or credits displayed on the device to the
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0013|     winners.
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0014|       Section 4.  COMMISSION ESTABLISHED--MEMBERSHIP--REQUIREMENTS.--
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0015|            A.  There is created the "video gaming commission"
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0016|     which shall consist of five members appointed by the governor
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0017|     with the advice and consent of the senate.  Appointees not
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0018|     confirmed by the senate shall continue to serve until the senate
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0019|     has failed to confirm.  Prior to appointing an individual, the
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0020|     governor shall request the superintendent to conduct an inquiry
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0021|     into the individual's background, with particular regard to
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0022|     financial stability, integrity, responsibility and reputation
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0023|     for good character.
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0024|            B.  Commission members serve three-year terms,
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0025|     staggered by lot.  One of the initial appointees shall serve
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0001|     until December 31, 1997, two shall serve until December 31,
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0002|     1998, and the remaining two until December 31, 1999.  Commission
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0003|     member shall be eligible for reappointment only once.  The chair
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0004|     of the commission shall be appointed by the governor and shall
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0005|     serve as chair at the pleasure of the governor.  The vice-chair
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0006|     of the commission, who shall have the full power of the chair in
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0007|     the absence of the chair, shall be elected by the commission for
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0008|     a term of one year.  Appointments to fill vacancies shall be for
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0009|     the unexpired term of the member replaced.  No person shall be
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0010|     appointed or continue to serve if the person has ever been
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0011|     convicted of or pled guilty or nolo contendere to an offense
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0012|     punishable by imprisonment for more than one year.
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0013|            C.  Each commission member may engage in any other
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0014|     business, occupation or gainful employment that is not in
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0015|     conflict with the duties of the commission.  One member of the
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0016|     commission shall represent those who manufacture, sell or
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0017|     operate video gaming devices.  Notwithstanding the provisions of
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0018|     Subsection A of Section 5 of the Video Gaming Act, the member so
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0019|     representing may hold an interest and accept anything of value
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0020|     related to bona fide employment or bona fide business ownership. 
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0021|     The commission shall meet at least once each month and at the
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0022|     call of the chair.  The commission shall also meet upon the call
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0023|     of two or more members after they have given seventy-two hour
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0024|     written notice to each member.
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0025|            D.  The chair of the commission shall receive seven
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0001|     thousand dollars ($7,000) per year and the other members six
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0002|     thousand dollars ($6,000).  All commission members shall be
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0003|     reimbursed in accordance with the provisions of the Per Diem and
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0004|     Mileage Act.
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0005|            E.  A majority of the commission shall constitute a
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0006|     quorum for purposes of conducting business, but no action or
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0007|     decision of the superintendent shall be reversed or modified by
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0008|     the commission unless at least three members vote to do so.
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0009|            F.  Initial appointments to the commission shall be
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0010|     made within thirty days of the effective date of the Video
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0011|     Gaming Act.
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0012|            G.  The commission shall:
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0013|                 (1)  hear and decide all appeals from decisions
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0014|     of the superintendent relative to the granting, suspension,
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0015|     revocation, condition or renewal of all licenses;
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0016|                 (2)  impose all fines under the Video Gaming
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0017|     Act;
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0018|                 (3)  approve or disapprove rules promulgated by
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0019|     the superintendent, provided that the commission shall not
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0020|     modify any rule and any rule not disapproved within sixty days
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0021|     of submission to the commission shall be deemed approved;
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0022|                 (4)  make an annual report to the governor and
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0023|     the legislature on the operation of the Video Gaming Act,
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0024|     including any recommendations for changes.
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0025|            H.  The commission shall approve, by rule, any games
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0001|     to be used in a video gaming device.  The commission shall
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0002|     approve all games which meet the definition of video gaming
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0003|     which the commission finds meet the commission's security
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0004|     requirements and will further the purposes of the Video Gaming
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0005|     Act.  The commission may approve games which do not provide
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0006|     immediate notice of outcome, but any games so approved shall be
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0007|     played only on video gaming devices, shall meet the commission's
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0008|     security requirements and shall be subject to the same central
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0009|     site computer monitoring system as all other games.  The
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0010|     commission shall designate resort areas by rule.
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0011|       Section 5.  PROHIBITED ACTS--PENALTY.--
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0012|            A.  No member of the commission or employee of the
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0013|     state, or any of its political subdivisions, agencies or
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0014|     instrumentalities, shall, directly or indirectly,:
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0015|                 (1)  hold a substantial interest in the
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0016|     manufacture, sale, distribution or operation of video gaming
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0017|     devices, equipment, services, tickets, machines or any business
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0018|     or entity which enters into a location agreement; 
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0019|                 (2)  have any interest whatsoever in the
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0020|     purchases or sales made by persons licensed under the Video
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0021|     Gaming Act or purchase, lease, or sell video gaming equipment,
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0022|     services, tickets, machines or other materials; 
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0023|                 (3)  solicit or accept any gift, gratuity,
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0024|     emolument or employment, of more than de minimis value, from any
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0025|     person licensed under the Video Gaming Act, or from any officer,
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0001|     agent or employee of such a person; or
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0002|                 (4)  solicit from, request from or recommend to
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0003|     any person licensed under that act or any officer, agent or
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0004|     employee of such a person, the appointment of any person to any
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0005|     place or position.
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0006|            B.  No person or entity licensed under the Video
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0007|     Gaming Act or any officer, agent or employee of such a person or
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0008|     entity shall offer to any member or employee of the commission
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0009|     or employee of the superintendent any gift, gratuity, emolument
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0010|     or employment, of more than de minimis value.
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0011|            C.  Any person violating the provisions of this
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0012|     section is guilty of a fourth degree felony and shall be
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0013|     sentenced in accordance with the provisions of Section 31-18-15
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0014|     NMSA 1978.
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0015|       Section 6.  SUPERINTENDENT--DUTIES.--The superintendent
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0016|     shall:
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0017|            A.  promulgate rules, in accordance with the State
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0018|     Rules Act and subject to the approval of the commission,
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0019|     relating to:
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0020|                 (1)  authorized premises for video gaming
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0021|     devices;
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0022|                 (2)  investigations of prospective or current
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0023|     licensees;
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0024|                 (3)  mandating that electronic fund transfers to
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0025|     the state of all money due from persons licensed under the Video
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0001|     Gaming Act and the necessary implementation requirements; and
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0002|                 (4)  other matters appropriate to carrying out
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0003|     the provisions of the Video Gaming Act;
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0004|            B.  provide staff and other support for the
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0005|     commission;
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0006|            C.  enter into such contracts other legal agreements
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0007|     as are necessary to carry out the decisions of the commission;
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0008|            D.  purchase or lease, in accordance with the
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0009|     Procurement Code, a central site computer monitoring system for
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0010|     video gaming devices and such other monitoring equipment as the
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0011|     commission finds appropriate;
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0012|            E.  issue all licenses and other documents necessary
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0013|     to carry out the purposes of the Video Gaming Act.  No person
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0014|     shall hold more than one level of license, nor shall a person
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0015|     holding a substantial interest in a license of one class hold a
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0016|     license of another level, provided, however, that the holder of
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0017|     a premises license may hold an operator's license may be an
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0018|     owner-operator of that premises license.  A person holding a
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0019|     substantial interest, prior to January 1, 1995, in a person or
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0020|     entity eligible for a level one license may apply for and hold a
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0021|     level three license in addition to the level one license so long
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0022|     as the ownership of the person or entity does not change.  The
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0023|     levels of license are as follows:
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0024|                 (1)  level one--manufacturer;
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0025|                 (2)  level two--operator; and
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0001|                 (3)  level three--premises;
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0002|            F.  annually issue a separate license for each
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0003|     qualified video gaming device in operation in the state.  The
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0004|     license shall not be removable from the device and shall be in
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0005|     the form of a numbered sticker which shall be attached to the
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0006|     device and indicate that the device has been inspected, although
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0007|     not necessarily in that year, and that all taxes and fees have
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0008|     been paid;
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0009|            G.  investigate and then approve or reject a video
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0010|     gaming device representative of each type or model proposed to
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0011|     be used in video gaming, and license each video gaming device
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0012|     prior to its installation or operation in any regulated system
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0013|     of video gaming;
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0014|            H.  investigate and then license each premises upon
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0015|     which the video gaming devices are to be played;
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0016|            I.  conduct spot inspections of video gaming devices
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0017|     on the premises where they are being played;
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0018|            J.  conduct hearings upon complaints charging
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0019|     violations of the Video Gaming Act or the superintendent's rules
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0020|     and, subject to an appeal to the commission, suspend, revoke or
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0021|     place conditions on the use of any license issued under that
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0022|     act;
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0023|            K.  conduct any other hearings provided for in the
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0024|     rules of the superintendent;
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0025|            L.  supervise, audit and investigate the operation of
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0001|     all games and devices played under the Video Gaming Act;
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0002|            M.  investigate for possible approval all persons or
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0003|     other entities seeking licenses and all of their financial
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0004|     sources.
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0005|       Section 7.  ADVISORY COMMITTEE--CREATION--DUTIES.--The
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0006|     superintendent shall appoint an advisory committee of seven
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0007|     members who shall serve at the pleasure of the superintendent. 
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0008|     They shall receive no per diem or mileage reimbursement or any
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0009|     other compensation or reimbursement for their expenses.  No
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0010|     employee of the state, its political subdivisions, agencies or
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0011|     instrumentalities, shall serve on the committee.  There shall be
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0012|     at least one member representing each of the following areas or
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0013|     industries:
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0014|            A.  the public at large;
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0015|            B.  the hotel and motel industry;
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0016|            C.  persons holding level two licenses, or, prior to
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0017|     the issuance of such licenses, persons proposing to hold such
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0018|     licenses;
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0019|            D.  the retail liquor industry;
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0020|            E.  the horse racing industry;
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0021|            F.  the restaurant industry; and
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0022|            G.  the fraternal orders.
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0023|       The committee shall advise the superintendent and the
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0024|     commission on the operation of the Video Gaming Act, any rules
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0025|     proposed to be promulgated pursuant to that act, the practical
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0001|     effect of any actions proposed to be taken under that act, any
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0002|     amendments to that act that might be necessary and any other
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0003|     matter the committee deems appropriate.
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0004|       Section 8.  LICENSES--APPLICATION--FEES.--
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0005|            A.  An applicant for a manufacturer's, operator's or
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0006|     premises license or any renewal of a license shall file an
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0007|     application with the superintendent in a form, and including all
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0008|     information, required by rule of the superintendent or the Video
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0009|     Gaming Act.  The application shall include a sworn statement by
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0010|     the principal licensee, or an individual authorized to act on
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0011|     behalf of the principal licensee, that the applicant shall
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0012|     comply with the Video Gaming Act and all rules promulgated
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0013|     pursuant to that act.
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0014|            B.  The following fees shall be transmitted in
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0015|     connection with the application for a license or renewal:
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0016|                 (1)  manufacturer's license--ten thousand
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0017|     dollars ($10,000);
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0018|                 (2)  operator's license--three thousand dollars
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0019|     ($3,000);
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0020|                 (3)  premises license held by a parimutuel
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0021|     horseracing facility or resort--ten thousand dollars ($10,000);
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0022|     and
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0023|                 (4)  all other premises license--five hundred
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0024|     dollars ($500).
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0025|            C.  A fee of five hundred dollars ($500) per device
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0001|     shall be transmitted with the application for a video gaming
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0002|     device license but shall not be transmitted with the application
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0003|     for any renewal.  This fee shall be in lieu of all other taxes
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0004|     and fees, including the gross receipts tax, attributable to the
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0005|     device or computed based upon the proceeds from the device
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0006|     except for the percentage net proceeds tax.
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0007|       Section 9.  APPLICATIONS--REQUIREMENTS--APPROVAL.--
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0008|            A.  Any person or entity whom the superintendent
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0009|     determines is qualified to be licensed, having due consideration
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0010|     for the proper protection of the health, safety, morals, good
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0011|     order and general welfare of the residents of the state, may be
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0012|     issued a license.  The burden of proving all qualifications of a
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0013|     licensee shall be upon the applicant.
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0014|            B.  No license shall be issued unless the
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0015|     superintendent is satisfied that the applicant:
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0016|                 (1)  is of good character, honesty and
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0017|     integrity;
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0018|                 (2)  does not have prior activities, including
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0019|     any criminal record, reputation, habits or associations that
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0020|     pose a threat to the public interest of the state or the
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0021|     effective regulation and control of video gaming within the
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0022|     state or create or enhance the dangers of unsuitable, unfair or
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0023|     illegal practices, methods or activities in the operation of the
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0024|     video gaming or in the business or financial arrangement
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0025|     incident to operating of video gaming;
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0001|                 (3)  have adequate business integrity, honesty
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0002|     and competence;
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0003|                 (4)  have proposed financing which is:
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0004|                      (a)  adequate for the nature of the
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0005|     proposed operation; and
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0006|                      (b)  from financial sources posing no risk
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0007|     to the integrity of the regulated system of video gaming;
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0008|                 (5)  have demonstrated sufficient technological
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0009|     capability to meet the superintendent's rules; and
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0010|                 (6)  are in all other respects qualified to be
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0011|     licensed consistent with the desired policy of the state.
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0012|            C.  Before any license is issued, every person
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0013|     holding a substantial interest in the applicant shall be proven
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0014|     by the applicant:
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0015|                 (1)  to be of good character, honesty and
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0016|     integrity; and
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0017|                 (2)  to have no prior activities, including any
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0018|     criminal record, reputation, habits or associations that pose a
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0019|     threat to the public interest of the state or the effective
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0020|     regulation and control of video gaming within the state or
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0021|     create or enhance the dangers of unsuitable, unfair or illegal
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0022|     practices, methods or activities in the operation of the video
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0023|     gaming or in the business or financial arrangement incident to
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0024|     the operation of video gaming.
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0025|            D.  An application for a license shall constitute a
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0001|     request for the determination of the applicant's general
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0002|     character, integrity and ability to participate in, engage in,
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0003|     or be associated with a regulated system of video games of
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0004|     chance.  An applicant shall provide any release or authorization
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0005|     determined by the superintendent to be appropriate for the
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0006|     consideration of an application.  Any written or oral statement
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0007|     made in the course of an official proceeding, including any
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0008|     investigation, shall be absolutely privileged and shall not
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0009|     impose any civil liability.
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0010|            E.  Until July 1, 1997, no operator's license shall
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0011|     be issued to any person who has not been, at the time of
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0012|     issuance, a bona fide resident of the state for two years nor
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0013|     shall an operator's license be issued to any entity in which a
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0014|     person ineligible to hold an operator's license pursuant to this
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0015|     subsection holds a substantial interest.  An owner-operator may
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0016|     be issued an operator's license and a premises license.
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0017|       Section 10.  LICENSES--TRANSFER--DISPLAY.--No license
    |
0018|     issued pursuant to the Video Gaming Act shall be assignable or
    |
0019|     transferable from person to person or device to device.  Any
    |
0020|     license so issued shall be conspicuously displayed at the
    |
0021|     licensee's principal place of business in an area visible to the
    |
0022|     public.
    |
0023|       Section 11.  LICENSES--INVESTIGATIONS.--
    |
0024|            A.  Any applicant for or holder of a licensed issued
    |
0025|     under the Video Gaming Act shall produce records or evidence and
    |
0001|     give all information requested by the superintendent or the
    |
0002|     commission.  No applicant or holder shall interfere or attempt
    |
0003|     to interfere with any investigation by the superintendent or
    |
0004|     commission.
    |
0005|            B.  Every manufacturer's licensee shall immediately
    |
0006|     make available for inspection by any agent of the state all
    |
0007|     papers, books and records produced by any video gaming equipment
    |
0008|     business and all portions of the establishment where equipment
    |
0009|     is manufactured, sold or distributed.  Any agent of the state
    |
0010|     shall be given immediate access to any portion of the
    |
0011|     establishment of any licensed manufacturer for the purpose of
    |
0012|     inspecting or examining any records or documents required to be
    |
0013|     kept by the licensee under the Video Gaming Act or any
    |
0014|     superintendent's rule or examining any equipment related to the
    |
0015|     conduct of any Video Gaming Activity.
    |
0016|            C.  Every operator and every person owning or
    |
0017|     controlling a premises shall immediately make available for
    |
0018|     inspection by any agent of the state all papers, books and
    |
0019|     records produced by any Video Gaming Activity or business and
    |
0020|     make available all portions of the establishment where
    |
0021|     electronic instant video gaming-related equipment or devices may
    |
0022|     be located in order to permit the agent to determine that all
    |
0023|     devices comply with minimum requirements and do not vary in any
    |
0024|     significant manner from the representative device of the same
    |
0025|     type approved by the superintendent.
    |
0001|            D.  The state may, after written or oral notice,
    |
0002|     remove a video gaming device or any portion of the device from
    |
0003|     the establishment where it is being operated for the purpose of
    |
0004|     examination and inspection.
    |
0005|       Section 12.  SUSPENSION--REVOCATION--SEIZURE.--
    |
0006|            A.  The superintendent may revoke a manufacturer's,
    |
0007|     operator's or premises license upon a finding that the licensee
    |
0008|     or any person holding a substantial interest in the licensee
    |
0009|     has:
    |
0010|                 (1)  provided false or misleading information to
    |
0011|     the superintendent or commission;
    |
0012|                 (2)  been convicted of any felony or gambling-related offense;
    |
0013|                 (3)  endangered the security of a video gaming
    |
0014|     device;
    |
0015|                 (4)  become a person whose character is no
    |
0016|     longer consistent with the protection of the public interest and
    |
0017|     trust in video gaming; or
    |
0018|                 (5)  become delinquent in remitting money owed
    |
0019|     to any person or to the state.
    |
0020|            B.  The superintendent may suspend or revoke a
    |
0021|     manufacturer's, operator's or premises license upon a finding
    |
0022|     that the licensee or any person holding a substantial interest
    |
0023|     in the licensee has violated the Video Gaming Act or
    |
0024|     superintendent's rule.  If the superintendent suspends or
    |
0025|     revokes or refuses to grant a license or seizes the video gaming
    |
0001|     devices of a licensee, any interested party may, upon written
    |
0002|     notice to the commission, in accordance with the rules of the
    |
0003|     superintendent, request a hearing.  The chair of the commission
    |
0004|     may stay the revocation of suspension of a license pending the
    |
0005|     outcome of the hearing.
    |
0006|            C.  Any person aggrieved by a decision of the
    |
0007|     superintendent may appeal the decision to the commission.
    |
0008|            D.  The superintendent may seize or seal any or all
    |
0009|     video gaming devices changed or modified in any manner not
    |
0010|     approved by the superintendent.
    |
0011|       Section 13.  DEVICE MANUFACTURE--RESPONSIBILITY.--
    |
0012|            A.  The responsibility for final assembly and initial
    |
0013|     operation of a video gaming device, in the manner approved by
    |
0014|     the superintendent, shall be with the manufacturer.  Changes in
    |
0015|     the manner of final assembly or initial operation of a device
    |
0016|     after a representative device has been submitted to the
    |
0017|     superintendent for inspection and approval shall void the
    |
0018|     approval unless prior to the change the manufacturer obtains
    |
0019|     approval from the superintendent in accordance with the
    |
0020|     provisions of this section.  A voided approval shall be deemed
    |
0021|     to revoke all licenses of the affected devices.
    |
0022|            B.  Any request for changes to be made in a video
    |
0023|     gaming device shall be submitted in writing to the
    |
0024|     superintendent for prior approval.  When appropriate, the
    |
0025|     request for a change shall be accompanied by a print, schematic,
    |
0001|     block diagram or machine analysis which contains details of the
    |
0002|     proposed change.  Further, a reason for the change shall be set
    |
0003|     forth.  In emergency cases, when a change is found by the
    |
0004|     superintendent to be necessary to prevent cheating or
    |
0005|     malfunction, a verbal request may be approved.  The verbal
    |
0006|     approval shall be followed within fifteen days by a written
    |
0007|     request noting the verbal approval and containing the additional
    |
0008|     material required by this subsection.
    |
0009|       Section 14.  VIDEO GAMING DEVICE LIMITATIONS.--
    |
0010|            A.  No video gaming device shall allow more than two
    |
0011|     dollars ($2.00) to be played on a single game or award, in any
    |
0012|     one game, games or credits worth in excess of eight hundred
    |
0013|     dollars ($800); provided that, after December 31, 1997, the
    |
0014|     commission may set a limit different from eight hundred dollars
    |
0015|     ($800) by regulation.
    |
0016|                 B.  No video gaming device shall directly dispense
    |
0017|     coins or currency.  
    |
0018|            C.  No person shall allow access to a video gaming
    |
0019|     device by a person under the age of twenty-one years, nor shall
    |
0020|     any person employ a person under the age of twenty-one years if
    |
0021|     any portion of the job duties are to be performed in any area
    |
0022|     licensed for the location of video gaming devices.
    |
0023|            D.  No video gaming device shall be available for
    |
0024|     play by the public unless it is included in a valid location
    |
0025|     agreement, it is located on premises licensed for the
    |
0001|     consumption of spirituous liquors, at least thirty-five percent
    |
0002|     of the receipts attributable to spirituous liquors, wine and
    |
0003|     fermented beverages are from sales for on premises consumption
    |
0004|     and:
    |
0005|                 (1) located on the premises owned, leased or
    |
0006|     maintained by a person holding an operator's license, but not
    |
0007|     for play by the public; or
    |
0008|                 (2)  the premises are owned, leased or
    |
0009|     maintained by the person or entity controlling the location at
    |
0010|     which the device is located; provided that, a financial
    |
0011|     institution may own or hold a substantial interest in a device
    |
0012|     for the period necessary for it to satisfy any valid security
    |
0013|     interest, not to exceed six months.
    |
0014|       Section 15.  VIDEO GAMING DEVICE REQUIREMENTS.--
    |
0015|            A.  An video gaming device may deliver or entitle the
    |
0016|     person playing the device to receive a printed ticket,
    |
0017|     exchangeable for cash, which specifies the time, date, amount of
    |
0018|     winnings and the location of the device.  A video gaming device
    |
0019|     shall record all use of the device and all amounts deposited in
    |
0020|     it and report the use and amounts deposited to a central site
    |
0021|     computer monitor.  A video gaming device shall, at a minimum:
    |
0022|                 (1)  pay out a mathematically demonstrable
    |
0023|     percentage of all amounts played, which shall be not less than
    |
0024|     eighty percent and not more than ninety-five percent.  Video
    |
0025|     games which may be affected by skill shall be evaluated against
    |
0001|     this criterion using a method of play which will provide the
    |
0002|     greatest return to the player over a period of continuous play;
    |
0003|                 (2)  use a random selection process to determine
    |
0004|     the outcome of each play of a game which meets ninety-five
    |
0005|     percent confidence limits using a standard chi squared test for
    |
0006|     randomness and which is impervious to outside influences;
    |
0007|                 (3)  display an accurate representation of the
    |
0008|     game outcome, and shall not alter any function of the device
    |
0009|     based on internal computation of payout percentage;
    |
0010|                 (4)  have the capacity to display outcome
    |
0011|     intermediate play steps, credits available, credits played,
    |
0012|     credits paid and credits cashed out for the most recent game
    |
0013|     played and one game prior;
    |
0014|                 (5)  be equipped with electronic meters and
    |
0015|     electromechanical meters capable of displaying monetary
    |
0016|     transactions and be capable of printing a record of those
    |
0017|     transactions.  The device memory shall be in units equal to the
    |
0018|     denomination of the device, be at least six digits in length and
    |
0019|     retain, at least, the following transaction records for a period
    |
0020|     of at least one hundred eighty days:
    |
0021|                      (a)  electronic meters:  money inserted,
    |
0022|     credits wagered, credits won, credits paid out, times logic area
    |
0023|     accessed, times ticket or other pay-out device accessed, credits
    |
0024|     or money won, number of credits representing money inserted by a
    |
0025|     player and credit for games won but not collected; and
    |
0001|                      (b)  electromechanical meters:  money
    |
0002|     inserted, total credits of ticket vouchers printed, credits
    |
0003|     played and credits won;
    |
0004|                 (6)  be designed so that replacement of parts of
    |
0005|     modules required for normal maintenance does not necessitate
    |
0006|     replacement of the meters.
    |
0007|            B.  Every video gaming device shall:
    |
0008|                 (1)  clearly represent its rules of play to the
    |
0009|     playing public; and
    |
0010|                 (2)  operate and play in accordance with the
    |
0011|     representation made to the superintendent and the public.
    |
0012|            C.  Pay off schedules applicable to each video gaming
    |
0013|     device shall be displayed on the device or in a conspicuous
    |
0014|     place immediately adjacent thereto or be accessible from the
    |
0015|     device.  Pay off schedules shall accurately state the range of
    |
0016|     actual pay offs or awards and shall not be worded in such manner
    |
0017|     as to mislead or deceive the public.  The posting of any
    |
0018|     misleading or deceptive material on any pay off schedule or
    |
0019|     failure to make payment in accordance with a posted pay off
    |
0020|     schedules shall constitute a violation of the Video Gaming Act.
    |
0021|            D.  The superintendent may inspect any video gaming
    |
0022|     device which is offered for sale or use in this state by a
    |
0023|     manufacturer.
    |
0024|       Section 16.  LOCATION AGREEMENTS--FILING.--All location
    |
0025|     agreements shall be filed with the superintendent of the
    |
0001|     division before becoming effective, and no location agreement
    |
0002|     shall be effective without being filed with the superintendent. 
    |
0003|     Any location agreement for a location which is not a resort or a
    |
0004|     parimutuel horseracing facility and which includes a video
    |
0005|     gaming device which is owned by a person or entity which does
    |
0006|     not hold an operator's license shall include a maintenance
    |
0007|     agreement for that machine with a person or entity holding an
    |
0008|     operator's license.  A person holding both a premises and an
    |
0009|     operator's license shall hold only one premises license.  This
    |
0010|     section shall not affect rights and obligations between private
    |
0011|     parties.
    |
0012|       Section 17.  LOCATION AGREEMENTS--PROCEEDS 
    |
0013|     DISTRIBUTION.--No location agreement shall require an operator
    |
0014|     to remit to another party more than fifty percent of the net
    |
0015|     proceeds, after deduction of any taxes due.
    |
0016|       Section 18.  VIDEO GAMING DEVICES--LIMITATIONS.--Video
    |
0017|     gaming devices shall not be made available for play except in
    |
0018|     accordance with this section.  Devices shall be placed only in
    |
0019|     locations which are age controlled.  Devices can only be placed
    |
0020|     in the following places in the following numbers:
    |
0021|            A.  premises licensed for the on-premises consumption
    |
0022|     of spirituous liquors--five devices;
    |
0023|            C.  premises that are resorts--fifty devices;
    |
0024|            D.  premises that are licensed as clubs under the
    |
0025|     Liquor Control Act as of January 1, 1995--fifteen devices;
    |
0001|            E.  premises that are parimutuel horseracing
    |
0002|     facilities--one hundred devices, if fifty percent of the money
    |
0003|     retained by the licensee is used exclusively for purses,
    |
0004|     provided that the money shall not be substituted for money
    |
0005|     otherwise dedicated to purses or awards, five devices,
    |
0006|     otherwise.  Notwithstanding the otherwise applicable number of
    |
0007|     devices permissible, no resort area shall have more than one
    |
0008|     hundred and fifty devices located within it; provided that, for
    |
0009|     purposes of calculating this limitation, premises that are
    |
0010|     licensed for consumption of spirituous liquors shall be deemed
    |
0011|     to have five devices.
    |
0012|       Section 19.  PERCENTAGE NET PROCEEDS TAX.--For the
    |
0013|     privilege of locating video gaming devices for play by the
    |
0014|     public, there is imposed on every operator a "percentage net
    |
0015|     proceeds tax."   The tax shall be equal to twenty percent of the
    |
0016|     net proceeds attributable to devices owned or maintained by the
    |
0017|     operator.  The taxable event shall be the playing of the device
    |
0018|     by the public.  The tax shall be due on the fifth of the month
    |
0019|     following the taxable event.  The taxation and revenue
    |
0020|     department is charged with administration of the tax.  The rate
    |
0021|     of the percentage net proceeds tax shall not be increased in any
    |
0022|     year in which the gross receipts tax is not increased and in
    |
0023|     such a year may be increased only by a proportion which bears
    |
0024|     the same ratio to the prior net proceeds tax as the increase in
    |
0025|     the gross receipts tax bears to prior gross receipts tax.
    |
0001|       Section 20.  ELECTIONS FOR LOCAL OPTION.--Any municipality
    |
0002|     containing over five thousand population according to the latest
    |
0003|     United States census, whether the county in which that
    |
0004|     municipality is situated has adopted the local option provisions
    |
0005|     of the Video Gaming Act or not, or any county in the state may
    |
0006|     adopt local option in the county or municipality upon the
    |
0007|     following terms and conditions: 
    |
0008|            A.  at any time after the effective date of the Video
    |
0009|     Gaming Act, the registered qualified electors of any proposed
    |
0010|     local option district may petition the governing body by filing
    |
0011|     one or more petitions in the appropriate office to hold an
    |
0012|     election for the purpose of determining whether the county or
    |
0013|     municipality shall adopt the local option provisions of the
    |
0014|     Video Gaming Act. If the aggregate of the signatures of such
    |
0015|     elector on all the petitions equals or exceeds five percent of
    |
0016|     the number of registered voters of the district, the governing
    |
0017|     body shall call an election within seventy-five days of the
    |
0018|     verification of the petition. The date of the filing of the
    |
0019|     petition shall be the date of the filing of the last petition
    |
0020|     which brings the number of signatures up to the required five
    |
0021|     percent; provided, however, that the governing body shall refuse
    |
0022|     to recognize the petition if more than three months have elapsed
    |
0023|     between the date of the first signature and the filing of the
    |
0024|     last petition necessary to bring the number of signatures on the
    |
0025|     petition up to five percent; 
    |
0001|            B.  the election shall be called, conducted, counted
    |
0002|     and canvassed substantially in the manner provided by law for
    |
0003|     general elections within the county or special municipal
    |
0004|     elections within the municipality, except as otherwise provided
    |
0005|     in this section; 
    |
0006|            C.  the votes at the election shall be counted,
    |
0007|     returned and canvassed as provided for in the case of general
    |
0008|     elections within the county or special municipal elections
    |
0009|     within the municipality; 
    |
0010|            D.  except as otherwise provided in this section,
    |
0011|     contests, recounts and rechecks shall be permitted as provided
    |
0012|     for in the case of candidates for county office in general
    |
0013|     elections or as provided for in the case of special municipal
    |
0014|     elections within the municipality. Applications for contests,
    |
0015|     recounts or rechecks may be filed by any person who voted in the
    |
0016|     election, and service shall be made upon the county clerk or
    |
0017|     municipal clerk as the case may be; 
    |
0018|            E.  if a majority of all the votes cast at the
    |
0019|     election are cast in favor of allowing the location of video
    |
0020|     gaming devices at resorts in the county or municipality, the
    |
0021|     chairman of the governing body shall declare by order entered
    |
0022|     upon the records of the county or municipality that the county
    |
0023|     or municipality has adopted the local option provisions of the
    |
0024|     Video Gaming Act and shall notify the commission of such
    |
0025|     results; 
    |
0001|            F.  no election held pursuant to this section shall
    |
0002|     be held within forty-two days of any primary, general, municipal
    |
0003|     or school district election. If, within sixty days from the
    |
0004|     verification of any petition as provided in Subsection A of this
    |
0005|     section, a primary, general, municipal or school election is
    |
0006|     held, the governing body may call an election for a day not less
    |
0007|     than sixty days after the primary, general, municipal or school
    |
0008|     election; 
    |
0009|            G.  if an election is held under the provisions of
    |
0010|     the Video Gaming Act in any county which contains within its
    |
0011|     limits any municipality of more than five thousand persons
    |
0012|     according to the last United States census, it is not necessary
    |
0013|     for the registered qualified electors in the municipality to
    |
0014|     file a separate petition asking for a separate or different vote
    |
0015|     on the question of adopting the local option provisions of the
    |
0016|     Video Gaming Act by the municipality. The election in the county
    |
0017|     shall be conducted so as to separate the votes in the
    |
0018|     municipality from those in the remaining parts of the county. If
    |
0019|     a majority of the voters in the county, including the voters in
    |
0020|     the municipality, vote against the location of video gaming
    |
0021|     devices at resorts in the county, the county shall not adopt the
    |
0022|     local option provisions of the Video Gaming Act; but if a
    |
0023|     majority of the votes in the municipality are in favor of
    |
0024|     locating video gaming devices at resorts, the municipality shall
    |
0025|     have adopted the local option provisions of the Video Gaming
    |
0001|     Act. Nothing contained in this subsection shall prevent any
    |
0002|     municipality from having a separate election under the terms of
    |
0003|     this section.
    |
0004|       Section 21.  RESUBMISSION OF LOCAL OPTION QUESTION.--In any
    |
0005|     local option district in which the local option provisions of
    |
0006|     the Video Gaming Act have been rejected by the voters, it shall
    |
0007|     be permissible after the expiration of two years from the date
    |
0008|     of the election at which the local option provisions of the
    |
0009|     Video Gaming Act were rejected, to have another local option
    |
0010|     election in the district.
    |
0011|       Section 22.  FUND CREATED.--There is created in the state
    |
0012|     treasury the "video gaming fund."  All money in the fund, and
    |
0013|     all interest attributable to it are appropriated to the
    |
0014|     superintendent for the purpose of carrying out the provisions of
    |
0015|     the Video Gaming Act.  All fees paid for licenses under the
    |
0016|     Video Gaming Act shall be credited to the fund.
    |
0017|       Section 23.  APPROPRIATION.--There is appropriated from the
    |
0018|     general fund to the video gaming fund the sum of one million
    |
0019|     five hundred thousand dollars ($1,500,000) for the purpose of
    |
0020|     carrying out the provisions of this act.  This appropriation
    |
0021|     shall not revert at the end of any fiscal year.
    |
0022|       Section 24.  SEVERABILITY.--If any part or application of
    |
0023|     this act is held invalid, the remainder or its application to
    |
0024|     other situations or persons shall not be affected.
    |
0025|       Section 25.  EFFECTIVE DATE.--The effective date of the
    |
0001|     provisions of the Video Gaming Act is July 1, 1996.
    |
0002|                             -  -
    |
0003|     
    |
0004|     
    |
0005|     
    |
0006|     
    |
0007|     
    |
0008|     
    |
0009|     
    |
0010|                              State of New Mexico
    |
0011|                    House of Representatives
    |
0012|   
    |
0013|                    FORTY-SECOND LEGISLATURE
    |
0014|                      SECOND SESSION, 1996
    |
0015|   
    |
0016|                                              January 29, l996
    |
0017|   
    |
0018|   
    |
0019|   Mr. Speaker:
    |
0020|   
    |
0021|       Your RULES AND ORDER OF BUSINESS COMMITTEE, to
    |
0022|   whom has been referred
    |
0023|   
    |
0024|                         HOUSE BILL 346
    |
0025|                                 
    |
0001|   has had it under consideration and finds same to be
    |
0002|   GERMANE in accordance with constitutional provisions.
    |
0003|   
    |
0004|                                Respectfully submitted,
    |
0005|   
    |
0006|   
    |
0007|                                                                 
    |
0008|    
    |
0009|                               Barbara A. Perea Casey,
    |
0010|   Chairperson
    |
0011|   
    |
0012|   
    |
0013|   Adopted                         Not Adopted                      
    |
0014|   
    |
0015|            (Chief Clerk)                       (Chief Clerk)
    |
0016|   
    |
0017|                      Date             
    |
0018|   
    |
0019|   The roll call vote was 9  For 0  Against
    |
0020|   Yes:          9
    |
0021|   Excused: Lujan, Nicely, Olguin, Pederson, Wallach,
    |
0022|   S. Williams
    |
0023|   Absent:  None
    |
0024|   
    |
0025|     H0346RC1                     State of New Mexico
    |
0001|                    House of Representatives
    |
0002|   
    |
0003|                    FORTY-SECOND LEGISLATURE
    |
0004|                      SECOND SESSION, 1996
    |
0005|   
    |
0006|   
    |
0007|                                             February 11, 1996
    |
0008|   
    |
0009|   
    |
0010|   Mr. Speaker:
    |
0011|   
    |
0012|       Your BUSINESS AND INDUSTRY COMMITTEE, to whom has
    |
0013|   been referred
    |
0014|   
    |
0015|                         HOUSE BILL 346
    |
0016|                                 
    |
0017|   has had it under consideration and reports same with
    |
0018|   recommendation that it DO NOT PASS, but that
    |
0019|   
    |
0020|        HOUSE BUSINESS AND INDUSTRY COMMITTEE SUBSTITUTE
    |
0021|                       FOR HOUSE BILL 346
    |
0022|                                 
    |
0023|   DO PASS, and thence referred to the APPROPRIATIONS AND
    |
0024|   FINANCE COMMITTEE.  
    |
0025|   
    |
0001|                                Respectfully submitted,
    |
0002|   
    |
0003|   
    |
0004|   
    |
0005|                                                              
    |
0006|     
    |
0007|                               Fred Luna, Chairman
    |
0008|   
    |
0009|   
    |
0010|   Adopted                         Not Adopted              
    |
0011|           
    |
0012|            (Chief Clerk)                       (Chief Clerk)
    |
0013|   
    |
0014|                      Date             
    |
0015|   
    |
0016|   The roll call vote was 7  For 3  Against
    |
0017|   Yes:          7
    |
0018|   No:      Alwin, Hobbs, Macko
    |
0019|   Excused: None
    |
0020|   Absent:  Gubbels, Varela
    |
0021|   
    |
0022|     H0346BI1    HOUSE BUSINESS AND INDUSTRY COMMITTEE SUBSTITUTE FOR
    |
0023|                         HOUSE BILL 346
    |
0024|     42nd legislature - STATE OF NEW MEXICO - second session, 1996
    |
0025|                                
    |
0001|     
    |
0002|     
    |
0003|     
    |
0004|     
    |
0005|     
    |
0006|     
    |
0007|                             AN ACT
    |
0008|     RELATING TO GAMES OF CHANCE; ENACTING THE VIDEO GAMING ACT;
    |
0009|     ESTABLISHING PROCEDURES; PRESCRIBING PENALTIES; IMPOSING TAXES
    |
0010|     AND FEES; PERMITTING VERTICAL INTEGRATION OF CERTAIN LICENSEES;
    |
0011|     PROVIDING FOR A CERTAIN LOCAL OPTION; MAKING APPROPRIATIONS.
    |
0012|     
    |
0013|     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
    |
0014|       Section 1.  SHORT TITLE.--Sections 1 through 22 of this act
    |
0015|     may be cited as the "Video Gaming Act."
    |
0016|       Section 2.  PURPOSE.--The purpose of the Video Gaming Act
    |
0017|     is to combat the growth of illegal gaming through the
    |
0018|     establishment of a regulated system of video games of chance. 
    |
0019|     The legislature finds that:
    |
0020|            A.  the technology now exists to provide a secure
    |
0021|     system of regulated gaming;
    |
0022|            B.  this system will:
    |
0023|                 (1)  offer fair play and return to consumers who
    |
0024|     use the system;
    |
0025|                 (2)  provide needed revenue to the state and its
    |
0001|     political subdivisions;
    |
0002|                 (3)  provide additional entertainment to attract
    |
0003|     tourists and increase their length of stay; and
    |
0004|                 (4)  provide additional jobs for the citizens of
    |
0005|     New Mexico.
    |
0006|       Section 3.  DEFINITIONS.--As used in the Video Gaming Act:
    |
0007|            A.  "age controlled environment" means a location, or
    |
0008|     portion of a location, licensed for the on premises consumption
    |
0009|     of spirituous liquors and the interior of which is not
    |
0010|     observable by any individual under the age of twenty-one years.
    |
0011|     No individual under the age of twenty-one years may be employed
    |
0012|     to work in the age controlled environment;
    |
0013|            B.  "application" means the forms and schedules
    |
0014|     prescribed by the commission upon which an applicant applies for
    |
0015|     a license or license renewal and includes, but is not limited
    |
0016|     to, information, disclosure statements and financial statements
    |
0017|     submitted;
    |
0018|            C.  "commission" means the video gaming commission;
    |
0019|            D.  "credit" means the basic unit of a win on a video
    |
0020|     gaming device which entitles the player to one additional free
    |
0021|     game at the lowest monetary rate at which one game may be
    |
0022|     purchased on that device;
    |
0023|            E.  "financial source" means any person, partnership,
    |
0024|     trust or corporation that provides credit for capital or
    |
0025|     operations where the terms of repayment extend for more than
    |
0001|     ninety days;
    |
0002|            F.  "fraternal order" or "veterans' club" means an
    |
0003|     organization described in Section 501(c)(8), (10), (19) or (23) of
    |
0004|     the federal Internal Revenue Code of 1986 and exempt from federal
    |
0005|     income taxation pursuant to Section 501(a) of that code;
    |
0006|            G.  "gross proceeds" means the total value of money
    |
0007|     placed in a video gaming device by consumers;
    |
0008|            H.  "holding a substantial interest" means:
    |
0009|                 (1)  ownership, operation, management or
    |
0010|     conducting the business of a proprietorship, directly or
    |
0011|     indirectly, by an individual or spouse of the individual;
    |
0012|                 (2)  sharing or being entitled to share in any
    |
0013|     profits, actual or potential, of a partnership or trust by an
    |
0014|     individual or spouse of the individual;
    |
0015|                 (3)  being an officer, director, stockholder or
    |
0016|     spouse of a stockholder in a corporation which is not publicly
    |
0017|     traded;
    |
0018|                 (4)  being the holder, legally or beneficially, of
    |
0019|     five percent or more of any class of stock or other evidence of
    |
0020|     ownership of a publicly traded corporation or other public traded
    |
0021|     entity or being the spouse of such a holder;
    |
0022|                 (5)  furnishing five percent or more of the
    |
0023|     capital of any entity.
    |
0024|       A person holding a substantial interest in any entity shall
    |
0025|     be deemed to hold a substantial interest in every entity in which
    |
0001|     the first entity holds a substantial interest;
    |
0002|            I.  "location agreement" means a written agreement
    |
0003|     between an operator and the person or entity owning or controlling
    |
0004|     a licensed premises for the placement of video gaming devices
    |
0005|     within the location for use by the public.  If the person or entity
    |
0006|     owns the devices, the person or entity's sworn statement to that
    |
0007|     effect shall be deemed a location agreement;
    |
0008|            J.  "manufacturer" means a person or entity which
    |
0009|     assembles, from subparts or raw materials, a complete video gaming
    |
0010|     device;
    |
0011|            K.  "manufacturer's license" means a license issued by
    |
0012|     the superintendent which authorizes the manufacture and transfer or
    |
0013|     sale of video gaming devices to an operator;
    |
0014|            L.  "net proceeds" means the gross proceeds minus all
    |
0015|     prizes paid out to players of a video gaming device;
    |
0016|            M.  "operator" means any person or entity who owns,
    |
0017|     services or maintains video gaming devices, but does not include
    |
0018|     any person owning or controlling, or holding a substantial interest
    |
0019|     in an entity which owns or controls, a licensed premises for which
    |
0020|     there is a location agreement;
    |
0021|            N.  "operator's license" means a license issued by the
    |
0022|     superintendent which authorizes a person to engage in the business
    |
0023|     of an operator;
    |
0024|            O.  "owner-operator" means any person or entity who
    |
0025|     owns, services or maintains video gaming devices, owns or leases
    |
0001|     one premises and is the holder of the premises license where the
    |
0002|     video gaming devices are located;
    |
0003|            P.  "parimutuel horseracing facility" means a premises
    |
0004|     licensed to hold public horseraces or horse meetings for profit or
    |
0005|     gain;
    |
0006|            Q.  "play" means to activate a video gaming device and
    |
0007|     to manipulate or work it for the purpose of winning as indicated by
    |
0008|     the pay-out schedule or accumulating credits to be replayed or to
    |
0009|     be cashed out of the machine in the form of a printed ticket to be
    |
0010|     exchanged for cash;
    |
0011|            R.  "premises license" means a license issued by the
    |
0012|     superintendent to a person or entity owning or controlling a
    |
0013|     location and authorizing the placement of video gaming devices at
    |
0014|     that location for play by the public;
    |
0015|            S. "spirituous liquors" means alcoholic beverages except
    |
0016|     fermented beverages such as wine, beer and ale;
    |
0017|            T.  "superintendent" means the superintendent of
    |
0018|     regulation and licensing; and
    |
0019|            U.  "video gaming device" means an electronic machine
    |
0020|     which utilizes a cathode ray tube or video display screen and
    |
0021|     microprocessors and which is available for consumer play upon
    |
0022|     payment of specified consideration, with winners immediately
    |
0023|     determined by the application of the element of chance, whether or
    |
0024|     not accompanied by an element of skill, and with a reward of
    |
0025|     possible games or credits displayed on the device to the winners.
    |
0001|       Section 4.  COMMISSION ESTABLISHED--MEMBERSHIP--REQUIREMENTS.--
    |
0002|            A.  There is created the "video gaming commission" which
    |
0003|     shall consist of five members appointed by the governor with the
    |
0004|     advice and consent of the senate.  Appointees not confirmed by the
    |
0005|     senate shall continue to serve until the senate has failed to
    |
0006|     confirm.  Prior to appointing an individual, the governor shall
    |
0007|     request the superintendent to conduct an inquiry into the
    |
0008|     individual's background, with particular regard to financial
    |
0009|     stability, integrity, responsibility and reputation for good
    |
0010|     character.
    |
0011|            B.  Commission members serve three-year terms, staggered
    |
0012|     by lot.  One of the initial appointees shall serve until December
    |
0013|     31, 1997, two shall serve until December 31, 1998, and the
    |
0014|     remaining two until December 31, 1999.  Commission member shall be
    |
0015|     eligible for reappointment only once.  The chair of the commission
    |
0016|     shall be appointed by the governor and shall serve as chair at the
    |
0017|     pleasure of the governor.  The vice-chair of the commission, who
    |
0018|     shall have the full power of the chair in the absence of the chair,
    |
0019|     shall be elected by the commission for a term of one year. 
    |
0020|     Appointments to fill vacancies shall be for the unexpired term of
    |
0021|     the member replaced.  No person shall be appointed or continue to
    |
0022|     serve if the person has ever been convicted of or pled guilty or
    |
0023|     nolo contendere to an offense punishable by imprisonment for more
    |
0024|     than one year.
    |
0025|            C.  Each commission member may engage in any other
    |
0001|     business, occupation or gainful employment that is not in conflict
    |
0002|     with the duties of the commission.  One member of the commission
    |
0003|     shall represent those who manufacture, sell or operate video gaming
    |
0004|     devices.  Notwithstanding the provisions of Subsection A of Section
    |
0005|     5 of the Video Gaming Act, the member so representing may hold an
    |
0006|     interest and accept anything of value related to bona fide
    |
0007|     employment or bona fide business ownership.  The commission shall
    |
0008|     meet at least once each month and at the call of the chair.  The
    |
0009|     commission shall also meet upon the call of two or more members
    |
0010|     after they have given seventy-two hour written notice to each
    |
0011|     member.
    |
0012|            D.  The chair of the commission shall receive seven
    |
0013|     thousand dollars ($7,000) per year and the other members six
    |
0014|     thousand dollars ($6,000).  All commission members shall be
    |
0015|     reimbursed in accordance with the provisions of the Per Diem and
    |
0016|     Mileage Act.
    |
0017|            E.  A majority of the commission shall constitute a
    |
0018|     quorum for purposes of conducting business, but no action or
    |
0019|     decision of the superintendent shall be reversed or modified by the
    |
0020|     commission unless at least three members vote to do so.
    |
0021|            F.  Initial appointments to the commission shall be made
    |
0022|     within thirty days of the effective date of the Video Gaming Act.
    |
0023|            G.  The commission shall:
    |
0024|                 (1)  hear and decide all appeals from decisions of
    |
0025|     the superintendent relative to the granting, suspension,
    |
0001|     revocation, condition or renewal of all licenses;
    |
0002|                 (2)  impose all fines under the Video Gaming Act;
    |
0003|                 (3)  approve or disapprove rules promulgated by
    |
0004|     the superintendent, provided that the commission shall not modify
    |
0005|     any rule and any rule not disapproved within sixty days of
    |
0006|     submission to the commission shall be deemed approved;
    |
0007|                 (4)  make an annual report to the governor and the
    |
0008|     legislature on the operation of the Video Gaming Act, including any
    |
0009|     recommendations for changes.
    |
0010|            H.  The commission shall approve, by rule, any games to
    |
0011|     be used in a video gaming device.  The commission shall approve all
    |
0012|     games which meet the definition of video gaming which the
    |
0013|     commission finds meet the commission's security requirements and
    |
0014|     will further the purposes of the Video Gaming Act.  The commission
    |
0015|     may approve games which do not provide immediate notice of outcome,
    |
0016|     but any games so approved shall be played only on video gaming
    |
0017|     devices, shall meet the commission's security requirements and
    |
0018|     shall be subject to the same central site computer monitoring
    |
0019|     system as all other games.  The commission shall designate resort
    |
0020|     areas by rule.
    |
0021|       Section 5.  PROHIBITED ACTS--PENALTY.--
    |
0022|            A.  No member of the commission or employee of the
    |
0023|     state, or any of its political subdivisions, agencies or
    |
0024|     instrumentalities, shall, directly or indirectly,:
    |
0025|                 (1)  hold a substantial interest in the
    |
0001|     manufacture, sale, distribution or operation of video gaming
    |
0002|     devices, equipment, services, tickets, machines or any business or
    |
0003|     entity which enters into a location agreement; 
    |
0004|                 (2)  have any interest whatsoever in the purchases
    |
0005|     or sales made by persons licensed under the Video Gaming Act or
    |
0006|     purchase, lease, or sell video gaming equipment, services, tickets,
    |
0007|     machines or other materials; 
    |
0008|                 (3)  solicit or accept any gift, gratuity,
    |
0009|     emolument or employment, of more than de minimis value, from any
    |
0010|     person licensed under the Video Gaming Act, or from any officer,
    |
0011|     agent or employee of such a person; or
    |
0012|                 (4)  solicit from, request from or recommend to
    |
0013|     any person licensed under that act or any officer, agent or
    |
0014|     employee of such a person, the appointment of any person to any
    |
0015|     place or position.
    |
0016|            B.  No person or entity licensed under the Video Gaming
    |
0017|     Act or any officer, agent or employee of such a person or entity
    |
0018|     shall offer to any member or employee of the commission or employee
    |
0019|     of the superintendent any gift, gratuity, emolument or employment,
    |
0020|     of more than de minimis value.
    |
0021|            C.  Any person violating the provisions of this section
    |
0022|     is guilty of a fourth degree felony and shall be sentenced in
    |
0023|     accordance with the provisions of Section 31-18-15 NMSA 1978.
    |
0024|       Section 6.  SUPERINTENDENT--DUTIES.--The superintendent
    |
0025|     shall:
    |
0001|            A.  promulgate rules, in accordance with the State Rules
    |
0002|     Act and subject to the approval of the commission, relating to:
    |
0003|                 (1)  authorized premises for video gaming devices;
    |
0004|                 (2)  investigations of prospective or current
    |
0005|     licensees;
    |
0006|                 (3)  mandating that electronic fund transfers to
    |
0007|     the state of all money due from persons licensed under the Video
    |
0008|     Gaming Act and the necessary implementation requirements; and
    |
0009|                 (4)  other matters appropriate to carrying out the
    |
0010|     provisions of the Video Gaming Act;
    |
0011|            B.  provide staff and other support for the commission;
    |
0012|            C.  enter into such contracts other legal agreements as
    |
0013|     are necessary to carry out the decisions of the commission;
    |
0014|            D.  purchase or lease, in accordance with the
    |
0015|     Procurement Code, a central site computer monitoring system for
    |
0016|     video gaming devices and such other monitoring equipment as the
    |
0017|     commission finds appropriate;
    |
0018|            E.  issue all licenses and other documents necessary to
    |
0019|     carry out the purposes of the Video Gaming Act.  No person shall
    |
0020|     hold more than one level of license, nor shall a person holding a
    |
0021|     substantial interest in a license of one class hold a license of
    |
0022|     another level, provided, however, that the holder of a premises
    |
0023|     license may hold an operator's license may be an owner-operator of
    |
0024|     that premises license.  A person holding a substantial interest,
    |
0025|     prior to January 1, 1995, in a person or entity eligible for a
    |
0001|     level one license may apply for and hold a level three license in
    |
0002|     addition to the level one license so long as the ownership of the
    |
0003|     person or entity does not change.  The levels of license are as
    |
0004|     follows:
    |
0005|                 (1)  level one--manufacturer;
    |
0006|                 (2)  level two--operator; and
    |
0007|                 (3)  level three--premises;
    |
0008|            F.  annually issue a separate license for each qualified
    |
0009|     video gaming device in operation in the state.  The license shall
    |
0010|     not be removable from the device and shall be in the form of a
    |
0011|     numbered sticker which shall be attached to the device and indicate
    |
0012|     that the device has been inspected, although not necessarily in
    |
0013|     that year, and that all taxes and fees have been paid;
    |
0014|            G.  investigate and then approve or reject a video
    |
0015|     gaming device representative of each type or model proposed to be
    |
0016|     used in video gaming, and license each video gaming device prior to
    |
0017|     its installation or operation in any regulated system of video
    |
0018|     gaming;
    |
0019|            H.  investigate and then license each premises upon
    |
0020|     which the video gaming devices are to be played;
    |
0021|            I.  conduct spot inspections of video gaming devices on
    |
0022|     the premises where they are being played;
    |
0023|            J.  conduct hearings upon complaints charging violations
    |
0024|     of the Video Gaming Act or the superintendent's rules and, subject
    |
0025|     to an appeal to the commission, suspend, revoke or place conditions
    |
0001|     on the use of any license issued under that act;
    |
0002|            K.  conduct any other hearings provided for in the rules
    |
0003|     of the superintendent;
    |
0004|            L.  supervise, audit and investigate the operation of
    |
0005|     all games and devices played under the Video Gaming Act;
    |
0006|            M.  investigate for possible approval all persons or
    |
0007|     other entities seeking licenses and all of their financial sources.
    |
0008|       Section 7.  ADVISORY COMMITTEE--CREATION--DUTIES.--The
    |
0009|     superintendent shall appoint an advisory committee of seven members
    |
0010|     who shall serve at the pleasure of the superintendent.  They shall
    |
0011|     receive no per diem or mileage reimbursement or any other
    |
0012|     compensation or reimbursement for their expenses.  No employee of
    |
0013|     the state, its political subdivisions, agencies or
    |
0014|     instrumentalities, shall serve on the committee.  There shall be at
    |
0015|     least one member representing each of the following areas or
    |
0016|     industries:
    |
0017|            A.  the public at large;
    |
0018|            B.  persons holding level two licenses, or, prior to the
    |
0019|     issuance of such licenses, persons proposing to hold such licenses;
    |
0020|            C.  the horse racing industry; and
    |
0021|            D.  the fraternal orders or veterans' clubs.
    |
0022|       The committee shall advise the superintendent and the
    |
0023|     commission on the operation of the Video Gaming Act, any rules
    |
0024|     proposed to be promulgated pursuant to that act, the practical
    |
0025|     effect of any actions proposed to be taken under that act, any
    |
0001|     amendments to that act that might be necessary and any other matter
    |
0002|     the committee deems appropriate.
    |
0003|       Section 8.  LICENSES--APPLICATION--FEES.--
    |
0004|            A.  An applicant for a manufacturer's, operator's or
    |
0005|     premises license or any renewal of a license shall file an
    |
0006|     application with the superintendent in a form, and including all
    |
0007|     information, required by rule of the superintendent or the Video
    |
0008|     Gaming Act.  The application shall include a sworn statement by the
    |
0009|     principal licensee, or an individual authorized to act on behalf of
    |
0010|     the principal licensee, that the applicant shall comply with the
    |
0011|     Video Gaming Act and all rules promulgated pursuant to that act.
    |
0012|            B.  The following fees shall be transmitted in
    |
0013|     connection with the application for a license or renewal:
    |
0014|                 (1)  manufacturer's license--ten thousand dollars
    |
0015|     ($10,000);
    |
0016|                 (2)  operator's license--three thousand dollars
    |
0017|     ($3,000);
    |
0018|                 (3)  premises license held by a parimutuel
    |
0019|     horseracing facility--ten thousand dollars ($10,000); and
    |
0020|                 (4)  premises license held by a fraternal order or
    |
0021|     veterans' club--five hundred dollars ($500).
    |
0022|            C.  A fee of five hundred dollars ($500) per device
    |
0023|     shall be transmitted with the application for a video gaming device
    |
0024|     license but shall not be transmitted with the application for any
    |
0025|     renewal.  This fee shall be in lieu of all other taxes and fees,
    |
0001|     including the gross receipts tax, attributable to the device or
    |
0002|     computed based upon the proceeds from the device except for the
    |
0003|     percentage net proceeds tax.
    |
0004|       Section 9.  APPLICATIONS--REQUIREMENTS--APPROVAL.--
    |
0005|            A.  Any person or entity whom the superintendent
    |
0006|     determines is qualified to be licensed, having due consideration
    |
0007|     for the proper protection of the health, safety, morals, good order
    |
0008|     and general welfare of the residents of the state, may be issued a
    |
0009|     license.  The burden of proving all qualifications of a licensee
    |
0010|     shall be upon the applicant.
    |
0011|            B.  No license shall be issued unless the superintendent
    |
0012|     is satisfied that the applicant:
    |
0013|                 (1)  is of good character, honesty and integrity;
    |
0014|                 (2)  does not have prior activities, including any
    |
0015|     criminal record, reputation, habits or associations that pose a
    |
0016|     threat to the public interest of the state or the effective
    |
0017|     regulation and control of video gaming within the state or create
    |
0018|     or enhance the dangers of unsuitable, unfair or illegal practices,
    |
0019|     methods or activities in the operation of the video gaming or in
    |
0020|     the business or financial arrangement incident to operating of
    |
0021|     video gaming;
    |
0022|                 (3)  have adequate business integrity, honesty and
    |
0023|     competence;
    |
0024|                 (4)  have proposed financing which is:
    |
0025|                      (a)  adequate for the nature of the proposed
    |
0001|     operation; and
    |
0002|                      (b)  from financial sources posing no risk to
    |
0003|     the integrity of the regulated system of video gaming;
    |
0004|                 (5)  have demonstrated sufficient technological
    |
0005|     capability to meet the superintendent's rules; and
    |
0006|                 (6)  are in all other respects qualified to be
    |
0007|     licensed consistent with the desired policy of the state.
    |
0008|            C.  Before any license is issued, every person holding a
    |
0009|     substantial interest in the applicant shall be proven by the
    |
0010|     applicant:
    |
0011|                 (1)  to be of good character, honesty and
    |
0012|     integrity; and
    |
0013|                 (2)  to have no prior activities, including any
    |
0014|     criminal record, reputation, habits or associations that pose a
    |
0015|     threat to the public interest of the state or the effective
    |
0016|     regulation and control of video gaming within the state or create
    |
0017|     or enhance the dangers of unsuitable, unfair or illegal practices,
    |
0018|     methods or activities in the operation of the video gaming or in
    |
0019|     the business or financial arrangement incident to the operation of
    |
0020|     video gaming.
    |
0021|            D.  An application for a license shall constitute a
    |
0022|     request for the determination of the applicant's general character,
    |
0023|     integrity and ability to participate in, engage in, or be
    |
0024|     associated with a regulated system of video games of chance.  An
    |
0025|     applicant shall provide any release or authorization determined by
    |
0001|     the superintendent to be appropriate for the consideration of an
    |
0002|     application.  Any written or oral statement made in the course of
    |
0003|     an official proceeding, including any investigation, shall be
    |
0004|     absolutely privileged and shall not impose any civil liability.
    |
0005|            E.  Until July 1, 1997, no operator's license shall be
    |
0006|     issued to any person who has not been, at the time of issuance, a
    |
0007|     bona fide resident of the state for two years nor shall an
    |
0008|     operator's license be issued to any entity in which a person
    |
0009|     ineligible to hold an operator's license pursuant to this
    |
0010|     subsection holds a substantial interest.  An owner-operator may be
    |
0011|     issued an operator's license and a premises license.
    |
0012|       Section 10.  LICENSES--TRANSFER--DISPLAY.--No license issued
    |
0013|     pursuant to the Video Gaming Act shall be assignable or
    |
0014|     transferable from person to person or device to device.  Any
    |
0015|     license so issued shall be conspicuously displayed at the
    |
0016|     licensee's principal place of business in an area visible to the
    |
0017|     public.
    |
0018|       Section 11.  LICENSES--INVESTIGATIONS.--
    |
0019|            A.  Any applicant for or holder of a license issued
    |
0020|     under the Video Gaming Act shall produce records or evidence and
    |
0021|     give all information requested by the superintendent or the
    |
0022|     commission.  No applicant or holder shall interfere or attempt to
    |
0023|     interfere with any investigation by the superintendent or
    |
0024|     commission.
    |
0025|            B.  Every manufacturer's licensee shall immediately make
    |
0001|     available for inspection by any agent of the state all papers,
    |
0002|     books and records produced by any video gaming equipment business
    |
0003|     and all portions of the establishment where equipment is
    |
0004|     manufactured, sold or distributed.  Any agent of the state shall be
    |
0005|     given immediate access to any portion of the establishment of any
    |
0006|     licensed manufacturer for the purpose of inspecting or examining
    |
0007|     any records or documents required to be kept by the licensee under
    |
0008|     the Video Gaming Act or any superintendent's rule or examining any
    |
0009|     equipment related to the conduct of any Video Gaming Activity.
    |
0010|            C.  Every operator and every person owning or
    |
0011|     controlling a premises shall immediately make available for
    |
0012|     inspection by any agent of the state all papers, books and records
    |
0013|     produced by any Video Gaming Activity or business and make
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0014|     available all portions of the establishment where electronic
    |
0015|     instant video gaming-related equipment or devices may be located in
    |
0016|     order to permit the agent to determine that all devices comply with
    |
0017|     minimum requirements and do not vary in any significant manner from
    |
0018|     the representative device of the same type approved by the
    |
0019|     superintendent.
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0020|            D.  The state may, after written or oral notice, remove
    |
0021|     a video gaming device or any portion of the device from the
    |
0022|     establishment where it is being operated for the purpose of
    |
0023|     examination and inspection.
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0024|       Section 12.  SUSPENSION--REVOCATION--SEIZURE.--
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0025|            A.  The superintendent may revoke a manufacturer's,
    |
0001|     operator's or premises license upon a finding that the licensee or
    |
0002|     any person holding a substantial interest in the licensee has:
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0003|                 (1)  provided false or misleading information to
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0004|     the superintendent or commission;
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0005|                 (2)  been convicted of any felony or gambling-related offense;
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0006|                 (3)  endangered the security of a video gaming
    |
0007|     device;
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0008|                 (4)  become a person whose character is no longer
    |
0009|     consistent with the protection of the public interest and trust in
    |
0010|     video gaming; or
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0011|                 (5)  become delinquent in remitting money owed to
    |
0012|     any person or to the state.
    |
0013|            B.  The superintendent may suspend or revoke a
    |
0014|     manufacturer's, operator's or premises license upon a finding that
    |
0015|     the licensee or any person holding a substantial interest in the
    |
0016|     licensee has violated the Video Gaming Act or superintendent's
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0017|     rule.  If the superintendent suspends or revokes or refuses to
    |
0018|     grant a license or seizes the video gaming devices of a licensee,
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0019|     any interested party may, upon written notice to the commission, in
    |
0020|     accordance with the rules of the superintendent, request a hearing. 
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0021|     The chair of the commission may stay the revocation of suspension
    |
0022|     of a license pending the outcome of the hearing.
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0023|            C.  Any person aggrieved by a decision of the
    |
0024|     superintendent may appeal the decision to the commission.
    |
0025|            D.  The superintendent may seize or seal any or all
    |
0001|     video gaming devices changed or modified in any manner not approved
    |
0002|     by the superintendent.
    |
0003|       Section 13.  DEVICE MANUFACTURE--RESPONSIBILITY.--
    |
0004|            A.  The responsibility for final assembly and initial
    |
0005|     operation of a video gaming device, in the manner approved by the
    |
0006|     superintendent, shall be with the manufacturer.  Changes in the
    |
0007|     manner of final assembly or initial operation of a device after a
    |
0008|     representative device has been submitted to the superintendent for
    |
0009|     inspection and approval shall void the approval unless prior to the
    |
0010|     change the manufacturer obtains approval from the superintendent in
    |
0011|     accordance with the provisions of this section.  A voided approval
    |
0012|     shall be deemed to revoke all licenses of the affected devices.
    |
0013|            B.  Any request for changes to be made in a video gaming
    |
0014|     device shall be submitted in writing to the superintendent for
    |
0015|     prior approval.  When appropriate, the request for a change shall
    |
0016|     be accompanied by a print, schematic, block diagram or machine
    |
0017|     analysis which contains details of the proposed change.  Further, a
    |
0018|     reason for the change shall be set forth.  In emergency cases, when
    |
0019|     a change is found by the superintendent to be necessary to prevent
    |
0020|     cheating or malfunction, a verbal request may be approved.  The
    |
0021|     verbal approval shall be followed within fifteen days by a written
    |
0022|     request noting the verbal approval and containing the additional
    |
0023|     material required by this subsection.
    |
0024|       Section 14.  VIDEO GAMING DEVICE LIMITATIONS.--
    |
0025|            A.  No video gaming device shall allow more than two
    |
0001|     dollars ($2.00) to be played on a single game or award, in any one
    |
0002|     game, games or credits worth in excess of eight hundred dollars
    |
0003|     ($800); provided that, after December 31, 1997, the commission may
    |
0004|     set a limit different from eight hundred dollars ($800) by
    |
0005|     regulation.
    |
0006|                 B.  No video gaming device shall directly dispense coins
    |
0007|     or currency.  
    |
0008|            C.  No person shall allow access to a video gaming
    |
0009|     device by a person under the age of twenty-one years, nor shall any
    |
0010|     person employ a person under the age of twenty-one years if any
    |
0011|     portion of the job duties are to be performed in any area licensed
    |
0012|     for the location of video gaming devices.
    |
0013|            D.  No video gaming device shall be available for play
    |
0014|     by the public unless it is included in a valid location agreement,
    |
0015|     it is located on premises licensed for the consumption of
    |
0016|     spirituous liquors, at least fifty-one percent of the receipts
    |
0017|     attributable to spirituous liquors, wine and fermented beverages
    |
0018|     are from sales for on premises consumption and:
    |
0019|                 (1) located on the premises owned, leased or
    |
0020|     maintained by a person holding an operator's license, but not for
    |
0021|     play by the public; or
    |
0022|                 (2)  the premises are owned, leased or maintained
    |
0023|     by the person or entity controlling the location at which the
    |
0024|     device is located; provided that, a financial institution may own
    |
0025|     or hold a substantial interest in a device for the period necessary
    |
0001|     for it to satisfy any valid security interest, not to exceed six
    |
0002|     months.
    |
0003|       Section 15.  VIDEO GAMING DEVICE REQUIREMENTS.--
    |
0004|            A.  A video gaming device may deliver or entitle the
    |
0005|     person playing the device to receive a printed ticket, exchangeable
    |
0006|     for cash, which specifies the time, date, amount of winnings and
    |
0007|     the location of the device.  A video gaming device shall record all
    |
0008|     use of the device and all amounts deposited in it and report the
    |
0009|     use and amounts deposited to a central site computer monitor.  A
    |
0010|     video gaming device shall, at a minimum:
    |
0011|                 (1)  pay out a mathematically demonstrable
    |
0012|     percentage of all amounts played, which shall be not less than
    |
0013|     eighty percent and not more than ninety-five percent.  Video games
    |
0014|     which may be affected by skill shall be evaluated against this
    |
0015|     criterion using a method of play which will provide the greatest
    |
0016|     return to the player over a period of continuous play;
    |
0017|                 (2)  use a random selection process to determine
    |
0018|     the outcome of each play of a game which meets ninety-five percent
    |
0019|     confidence limits using a standard chi squared test for randomness
    |
0020|     and which is impervious to outside influences;
    |
0021|                 (3)  display an accurate representation of the
    |
0022|     game outcome, and shall not alter any function of the device based
    |
0023|     on internal computation of payout percentage;
    |
0024|                 (4)  have the capacity to display outcome
    |
0025|     intermediate play steps, credits available, credits played, credits
    |
0001|     paid and credits cashed out for the most recent game played and one
    |
0002|     game prior;
    |
0003|                 (5)  be equipped with electronic meters and
    |
0004|     electromechanical meters capable of displaying monetary
    |
0005|     transactions and be capable of printing a record of those
    |
0006|     transactions.  The device memory shall be in units equal to the
    |
0007|     denomination of the device, be at least six digits in length and
    |
0008|     retain, at least, the following transaction records for a period of
    |
0009|     at least one hundred eighty days:
    |
0010|                      (a)  electronic meters:  money inserted,
    |
0011|     credits wagered, credits won, credits paid out, times logic area
    |
0012|     accessed, times ticket or other pay-out device accessed, credits or
    |
0013|     money won, number of credits representing money inserted by a
    |
0014|     player and credit for games won but not collected; and
    |
0015|                      (b)  electromechanical meters:  money
    |
0016|     inserted, total credits of ticket vouchers printed, credits played
    |
0017|     and credits won;
    |
0018|                 (6)  be designed so that replacement of parts of
    |
0019|     modules required for normal maintenance does not necessitate
    |
0020|     replacement of the meters.
    |
0021|            B.  Every video gaming device shall:
    |
0022|                 (1)  clearly represent its rules of play to the
    |
0023|     playing public; and
    |
0024|                 (2)  operate and play in accordance with the
    |
0025|     representation made to the superintendent and the public.
    |
0001|            C.  Pay off schedules applicable to each video gaming
    |
0002|     device shall be displayed on the device or in a conspicuous place
    |
0003|     immediately adjacent thereto or be accessible from the device.  Pay
    |
0004|     off schedules shall accurately state the range of actual pay offs
    |
0005|     or awards and shall not be worded in such manner as to mislead or
    |
0006|     deceive the public.  The posting of any misleading or deceptive
    |
0007|     material on any pay off schedule or failure to make payment in
    |
0008|     accordance with a posted pay off schedules shall constitute a
    |
0009|     violation of the Video Gaming Act.
    |
0010|            D.  The superintendent may inspect any video gaming
    |
0011|     device which is offered for sale or use in this state by a
    |
0012|     manufacturer.
    |
0013|       Section 16.  LOCATION AGREEMENTS--FILING.--All location
    |
0014|     agreements shall be filed with the superintendent of the division
    |
0015|     before becoming effective, and no location agreement shall be
    |
0016|     effective without being filed with the superintendent.  Any
    |
0017|     location agreement for a location which is not a parimutuel
    |
0018|     horseracing facility and which includes a video gaming device which
    |
0019|     is owned by a person or entity which does not hold an operator's
    |
0020|     license shall include a maintenance agreement for that machine with
    |
0021|     a person or entity holding an operator's license.  A person holding
    |
0022|     both a premises and an operator's license shall hold only one
    |
0023|     premises license.  This section shall not affect rights and
    |
0024|     obligations between private parties.
    |
0025|       Section 17.  LOCATION AGREEMENTS--PROCEEDS 
    |
0001|     DISTRIBUTION.--No location agreement shall require an operator to
    |
0002|     remit to another party more than fifty percent of the net proceeds,
    |
0003|     after deduction of any taxes due.
    |
0004|       Section 18.  VIDEO GAMING DEVICES--LIMITATIONS.--Video gaming
    |
0005|     devices shall not be made available for play except in accordance
    |
0006|     with this section.  Devices shall be placed only in locations which
    |
0007|     are age controlled.  Devices can only be placed in the following
    |
0008|     places in the following numbers:
    |
0009|            A.  premises that are licensed as clubs under the Liquor
    |
0010|     Control Act as of January 1, 1995--fifteen devices; or
    |
0011|            B.  premises that are parimutuel horseracing facilities-one hundred devices, provided that fifty percent of the money
    |
0012|     retained by the licensee is used exclusively for purses and
    |
0013|     provided that the money shall not be substituted for money
    |
0014|     otherwise dedicated to purses or awards, five devices, otherwise. 
    |
0015|       Section 19.  PERCENTAGE NET PROCEEDS TAX.--For the privilege
    |
0016|     of locating video gaming devices for play by the public, there is
    |
0017|     imposed on every operator a "percentage net proceeds tax."   The
    |
0018|     tax shall be equal to twenty percent of the net proceeds
    |
0019|     attributable to devices owned or maintained by the operator.  The
    |
0020|     taxable event shall be the playing of the device by the public. 
    |
0021|     The tax shall be due on the fifth of the month following the
    |
0022|     taxable event.  The taxation and revenue department is charged with
    |
0023|     administration of the tax.  The rate of the percentage net proceeds
    |
0024|     tax shall not be increased in any year in which the gross receipts
    |
0025|     tax is not increased and in such a year may be increased only by a
    |
0001|     proportion which bears the same ratio to the prior net proceeds tax
    |
0002|     as the increase in the gross receipts tax bears to prior gross
    |
0003|     receipts tax.
    |
0004|       Section 20.  ELECTIONS FOR LOCAL OPTION.--Any municipality
    |
0005|     containing over five thousand population according to the latest
    |
0006|     United States census, whether the county in which that municipality
    |
0007|     is situated has adopted the local option provisions of the Video
    |
0008|     Gaming Act or not, or any county in the state may adopt local
    |
0009|     option in the county or municipality upon the following terms and
    |
0010|     conditions: 
    |
0011|            A.  at any time after the effective date of the Video
    |
0012|     Gaming Act, the registered qualified electors of any proposed local
    |
0013|     option district may petition the governing body by filing one or
    |
0014|     more petitions in the appropriate office to hold an election for
    |
0015|     the purpose of determining whether the county or municipality shall
    |
0016|     adopt the local option provisions of the Video Gaming Act. If the
    |
0017|     aggregate of the signatures of such elector on all the petitions
    |
0018|     equals or exceeds five percent of the number of registered voters
    |
0019|     of the district, the governing body shall call an election within
    |
0020|     seventy-five days of the verification of the petition. The date of
    |
0021|     the filing of the petition shall be the date of the filing of the
    |
0022|     last petition which brings the number of signatures to the required
    |
0023|     five percent; provided, however, that the governing body shall
    |
0024|     refuse to recognize the petition if more than three months have
    |
0025|     elapsed between the date of the first signature and the filing of
    |
0001|     the last petition necessary to bring the number of signatures on
    |
0002|     the petition to five percent; 
    |
0003|            B.  the election shall be called, conducted, counted and
    |
0004|     canvassed substantially in the manner provided by law for general
    |
0005|     elections within the county or special municipal elections within
    |
0006|     the municipality, except as otherwise provided in this section; 
    |
0007|            C.  the votes at the election shall be counted, returned
    |
0008|     and canvassed as provided for in the case of general elections
    |
0009|     within the county or special municipal elections within the
    |
0010|     municipality; 
    |
0011|            D.  except as otherwise provided in this section,
    |
0012|     contests, recounts and rechecks shall be permitted as provided for
    |
0013|     in the case of candidates for county office in general elections or
    |
0014|     as provided for in the case of special municipal elections within
    |
0015|     the municipality. Applications for contests, recounts or rechecks
    |
0016|     may be filed by any person who voted in the election, and service
    |
0017|     shall be made upon the county clerk or municipal clerk as the case
    |
0018|     may be; 
    |
0019|            E.  if a majority of all the votes cast at the election
    |
0020|     are cast in favor of allowing the location of video gaming devices
    |
0021|     at parimutuel horse racing facilities, fraternal order or veterans'
    |
0022|     clubs in the county or municipality, the chairman of the governing
    |
0023|     body shall declare by order entered upon the records of the county
    |
0024|     or municipality that the county or municipality has adopted the
    |
0025|     local option provisions of the Video Gaming Act and shall notify
    |
0001|     the commission of such results; 
    |
0002|            F.  no election held pursuant to this section shall be
    |
0003|     held within forty-two days of any primary, general, municipal or
    |
0004|     school district election. If, within sixty days from the
    |
0005|     verification of any petition as provided in Subsection A of this
    |
0006|     section, a primary, general, municipal or school election is held,
    |
0007|     the governing body may call an election for a day not less than
    |
0008|     sixty days after the general, municipal or school election; 
    |
0009|            G.  if an election is held under the provisions of the
    |
0010|     Video Gaming Act in any county which contains within its limits any
    |
0011|     municipality of more than five thousand persons according to the
    |
0012|     last United States census, it is not necessary for the registered
    |
0013|     qualified electors in the municipality to file a separate petition
    |
0014|     asking for a separate or different vote on the question of adopting
    |
0015|     the local option provisions of the Video Gaming Act by the
    |
0016|     municipality. The election in the county shall be conducted so as
    |
0017|     to separate the votes in the municipality from those in the
    |
0018|     remaining parts of the county. If a majority of the voters in the
    |
0019|     county, including the voters in the municipality, vote against the
    |
0020|     location of video gaming devices at parimutuel horse racing
    |
0021|     facilities, fraternal order clubs or veterans' clubs in the county,
    |
0022|     the county shall not adopt the local option provisions of the Video
    |
0023|     Gaming Act; but if a majority of the votes in the municipality are
    |
0024|     in favor of locating video gaming devices at resorts, the
    |
0025|     municipality shall have adopted the local option provisions of the
    |
0001|     Video Gaming Act. Nothing contained in this subsection shall
    |
0002|     prevent any municipality from having a separate election under the
    |
0003|     terms of this section.
    |
0004|       Section 21.  RESUBMISSION OF LOCAL OPTION QUESTION.--In any
    |
0005|     local option district in which the local option provisions of the
    |
0006|     Video Gaming Act have been rejected by the voters, it shall be
    |
0007|     permissible after the expiration of two years from the date of the
    |
0008|     election at which the local option provisions of the Video Gaming
    |
0009|     Act were rejected, to have another local option election in the
    |
0010|     district.
    |
0011|       Section 22.  FUND CREATED.--There is created in the state
    |
0012|     treasury the "video gaming fund."  All money in the fund, and all
    |
0013|     interest attributable to it are appropriated to the superintendent
    |
0014|     for the purpose of carrying out the provisions of the Video Gaming
    |
0015|     Act.  All fees paid for licenses under the Video Gaming Act shall
    |
0016|     be credited to the fund.
    |
0017|       Section 23.  APPROPRIATION.--There is appropriated from the
    |
0018|     general fund to the video gaming fund the sum of one million five
    |
0019|     hundred thousand dollars ($1,500,000) for the purpose of carrying
    |
0020|     out the provisions of this act.  This appropriation shall not
    |
0021|     revert at the end of any fiscal year.
    |
0022|       Section 24.  SEVERABILITY.--If any part or application of
    |
0023|     this act is held invalid, the remainder or its application to other
    |
0024|     situations or persons shall not be affected.
    |
0025|       Section 25.  EFFECTIVE DATE.--The effective date of the
    |
0001|     provisions of the Video Gaming Act is July 1, 1996.
    |
0002|                              -  -
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0008|     
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0010|     
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