1.2relating to the State Lottery; establishing lottery facility games; imposing a
1.3tax on and providing for facility revenues; providing powers and duties to the
1.4director; making clarifying, conforming, and technical changes;amending
1.5Minnesota Statutes 2010, sections 297A.94; 299L.02, subdivision 1; 299L.07,
1.6subdivisions 2, 2a; 340A.404, by adding a subdivision; 340A.410, subdivision 5;
1.7349A.01, subdivisions 10, 11, 12, by adding subdivisions; 349A.02, subdivision
1.83; 349A.04; 349A.06, subdivision 8; 349A.08, subdivisions 1, 5, 8; 349A.10,
1.9subdivisions 2, 5; 349A.11, subdivision 1; 349A.13; 541.20; 541.21; 609.75,
1.10subdivision 3; 609.761, subdivision 2; proposing coding for new law in
1.11Minnesota Statutes, chapters 297A; 349A.
1.12BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.13    Section 1. [297A.651] LOTTERY FACILITY GAMES; IN-LIEU TAX.
1.14Lottery gaming facility revenues authorized under section 349A.17 are exempt from
1.15the tax imposed under section 297A.62. The State Lottery must on or before the 20th
1.16day of each month transmit to the commissioner an amount equal to the lottery gaming
1.17facility revenues as defined in section 349A.01, for the previous month multiplied by 20
1.18percent. The commissioner shall deposit the money transmitted under this section in the
1.19state treasury to be credited as provided in section 297A.94.

1.20    Sec. 2. Minnesota Statutes 2010, section 297A.94, is amended to read:
1.21297A.94 DEPOSIT OF REVENUES.
1.22(a) Except as provided in this section, the commissioner shall deposit the revenues,
1.23including interest and penalties, derived from the taxes imposed by this chapter in the state
1.24treasury and credit them to the general fund.
1.25(b) The commissioner shall deposit taxes in the Minnesota agricultural and economic
1.26account in the special revenue fund if:
2.1(1) the taxes are derived from sales and use of property and services purchased for
2.2the construction and operation of an agricultural resource project; and
2.3(2) the purchase was made on or after the date on which a conditional commitment
2.4was made for a loan guaranty for the project under section 41A.04, subdivision 3.
2.5The commissioner of management and budget shall certify to the commissioner the date
2.6on which the project received the conditional commitment. The amount deposited in
2.7the loan guaranty account must be reduced by any refunds and by the costs incurred by
2.8the Department of Revenue to administer and enforce the assessment and collection of
2.9the taxes.
2.10(c) The commissioner shall deposit the revenues, including interest and penalties,
2.11derived from the taxes imposed on sales and purchases included in section 297A.61,
2.12subdivision 3 , paragraph (g), clauses (1) and (4), in the state treasury, and credit them
2.13as follows:
2.14(1) first to the general obligation special tax bond debt service account in each fiscal
2.15year the amount required by section 16A.661, subdivision 3, paragraph (b); and
2.16(2) after the requirements of clause (1) have been met, the balance to the general
2.17fund.
2.18(d) The commissioner shall deposit the revenues, including interest and penalties,
2.19collected under section 297A.64, subdivision 5, in the state treasury and credit them to the
2.20general fund. By July 15 of each year the commissioner shall transfer to the highway user
2.21tax distribution fund an amount equal to the excess fees collected under section 297A.64,
2.22subdivision 5 , for the previous calendar year.
2.23(e) For fiscal year 2001, 97 percent; for fiscal years 2002 and 2003, 87 percent; and
2.24for fiscal year 2004 and thereafter, 72.43 percent of the revenues, including interest and
2.25penalties, transmitted to the commissioner under section 297A.65, must be deposited by
2.26the commissioner in the state treasury as follows:
2.27(1) 50 percent of the receipts must be deposited in the heritage enhancement account
2.28in the game and fish fund, and may be spent only on activities that improve, enhance, or
2.29protect fish and wildlife resources, including conservation, restoration, and enhancement
2.30of land, water, and other natural resources of the state;
2.31(2) 22.5 percent of the receipts must be deposited in the natural resources fund, and
2.32may be spent only for state parks and trails;
2.33(3) 22.5 percent of the receipts must be deposited in the natural resources fund, and
2.34may be spent only on metropolitan park and trail grants;
2.35(4) three percent of the receipts must be deposited in the natural resources fund, and
2.36may be spent only on local trail grants; and
3.1(5) two percent of the receipts must be deposited in the natural resources fund,
3.2and may be spent only for the Minnesota Zoological Garden, the Como Park Zoo and
3.3Conservatory, and the Duluth Zoo.
3.4(f) Revenues transmitted to the commissioner under section 297A.651 must be
3.5deposited by the commissioner in the state treasury in the general fund.
3.6(f) (g) The revenue dedicated under paragraph (e) may not be used as a substitute
3.7for traditional sources of funding for the purposes specified, but the dedicated revenue
3.8shall supplement traditional sources of funding for those purposes. Land acquired with
3.9money deposited in the game and fish fund under paragraph (e) must be open to public
3.10hunting and fishing during the open season, except that in aquatic management areas or
3.11on lands where angling easements have been acquired, fishing may be prohibited during
3.12certain times of the year and hunting may be prohibited. At least 87 percent of the money
3.13deposited in the game and fish fund for improvement, enhancement, or protection of fish
3.14and wildlife resources under paragraph (e) must be allocated for field operations.
3.15(g) (h) The revenues deposited under paragraphs (a) to (f) do not include the
3.16revenues, including interest and penalties, generated by the sales tax imposed under
3.17section 297A.62, subdivision 1a, which must be deposited as provided under the
3.18Minnesota Constitution, article XI, section 15.

3.19    Sec. 3. Minnesota Statutes 2010, section 299L.02, subdivision 1, is amended to read:
3.20    Subdivision 1. Lottery. (a) The director shall when required under chapter 349A or
3.21when requested by the director of the lottery conduct background checks on employees of
3.22the State Lottery, lottery retailers, and bidders of lottery procurement contracts.
3.23(b) The director shall, when so requested by the director of the State Lottery or when
3.24the director believes it to be reasonable and necessary, conduct investigations of lottery
3.25retailers, applicants for lottery retailer contracts, suppliers of goods or services to the State
3.26Lottery, and persons bidding on contracts for goods or services with the State Lottery.
3.27(c) The director shall conduct an annual security audit of the State Lottery, or arrange
3.28for such an audit by an outside agency or person, firm, or corporation. The director shall
3.29report to the director of the lottery on the results of the audit.
3.30(d) The director shall deposit in a separate account in the state treasury all money
3.31received from the director of the State Lottery for charges for investigations and
3.32background checks relating to the lottery gaming facility management contract, the lottery
3.33gaming facility manager and vendor licenses under chapter 349A. Money in the account
3.34is appropriated to the director for the purpose of carrying out the director's powers and
3.35duties under this subdivision.

4.1    Sec. 4. Minnesota Statutes 2010, section 299L.07, subdivision 2, is amended to read:
4.2    Subd. 2. Exclusions. Notwithstanding subdivision 1, a gambling device:
4.3(1) may be sold by a person who is not licensed under this section, if the person (i) is
4.4not engaged in the trade or business of selling gambling devices, and (ii) does not sell
4.5more than one gambling device in any calendar year;
4.6(2) may be sold by the governing body of a federally recognized Indian tribe
4.7described in subdivision 2a, paragraph (b), clause (1), which is not licensed under this
4.8section, if (i) the gambling device was operated by the Indian tribe, (ii) the sale is to
4.9a distributor licensed under this section, and (iii) the licensed distributor notifies the
4.10commissioner of the purchase, in the same manner as is required when the licensed
4.11distributor ships a gambling device into Minnesota;
4.12(3) may be possessed by a person not licensed under this section if the person holds
4.13a permit issued under section 299L.08; and
4.14(4) may be possessed by a state agency, with the written authorization of the director,
4.15for display or evaluation purposes only and not for the conduct of gambling; and
4.16(5) may be operated by the State Lottery or by the lottery gaming facility manager
4.17authorized by the State Lottery, as authorized under chapter 349A.

4.18    Sec. 5. Minnesota Statutes 2010, section 299L.07, subdivision 2a, is amended to read:
4.19    Subd. 2a. Restrictions. (a) A manufacturer licensed under this section may sell,
4.20offer to sell, lease, or rent, in whole or in part, a gambling device only to a distributor
4.21licensed under this section or to the State Lottery or the lottery gaming facility manager
4.22authorized by the State Lottery, as authorized under chapter 349A.
4.23(b) A distributor licensed under this section may sell, offer to sell, market, rent,
4.24lease, or otherwise provide, in whole or in part, a gambling device only to:
4.25(1) the governing body of a federally recognized Indian tribe that is authorized
4.26to operate the gambling device under a tribal state compact under the Indian Gaming
4.27Regulatory Act, Public Law 100-497, and future amendments to it;
4.28(2) a person for use in the person's dwelling for display or amusement purposes in a
4.29manner that does not afford players an opportunity to obtain anything of value;
4.30(3) another distributor licensed under this section; or
4.31(4) a person in another state who is authorized under the laws of that state to possess
4.32the gambling device; or
4.33(5) the State Lottery or the lottery gaming facility manager authorized by the State
4.34Lottery, as authorized under chapter 349A.

5.1    Sec. 6. Minnesota Statutes 2010, section 340A.404, is amended by adding a
5.2subdivision to read:
5.3    Subd. 2c. City of Minneapolis; lottery gaming enterprise; lottery gaming
5.4facility. (a) Notwithstanding any other law, local ordinance or charter provision, the city
5.5of Minneapolis may issue one or more on-sale intoxicating liquor licenses to the owner,
5.6manager or operator of the lottery gaming enterprise or lottery gaming facility, or to an
5.7entity holding a concessions contract with the owner, manager, or operator for use on the
5.8premises of the lottery gaming enterprise or lottery gaming facility.
5.9(b) The licenses shall authorize sales on all days of the week.
5.10(c) The licenses authorized by this subdivision may be issued for space that is
5.11not compact and contiguous, provided that all such space is within or adjacent to the
5.12lottery gaming enterprise and is included in the description of the licensed premises on
5.13the approved license application.
5.14(d) The licenses are in addition to the number authorized by law.

5.15    Sec. 7. Minnesota Statutes 2010, section 340A.410, subdivision 5, is amended to read:
5.16    Subd. 5. Gambling prohibited. (a) Except as otherwise provided in this
5.17subdivision, no retail establishment licensed to sell alcoholic beverages may keep, possess,
5.18or operate, or permit the keeping, possession, or operation on the licensed premises of dice
5.19or any gambling device as defined in section 349.30, or permit gambling therein.
5.20(b) Gambling equipment may be kept or operated and raffles conducted on licensed
5.21premises and adjoining rooms when the use of the gambling equipment is authorized by
5.22(1) chapter 349, (2) a tribal ordinance in conformity with the Indian Gaming Regulatory
5.23Act, Public Law 100-497, or (3) a tribal-state compact authorized under section 3.9221.
5.24(c) Lottery tickets may be purchased and sold within the licensed premises as
5.25authorized by the director of the lottery under chapter 349A.
5.26(d) Dice may be kept and used on licensed premises and adjoining rooms as
5.27authorized by section 609.761, subdivision 4.
5.28(e) Gambling devices may be operated and gambling permitted in a lottery gaming
5.29facility as authorized by chapter 349A.

5.30    Sec. 8. Minnesota Statutes 2010, section 349A.01, is amended by adding a subdivision
5.31to read:
5.32    Subd. 1a. Ancillary lottery gaming facility enterprise operations. "Ancillary
5.33lottery gaming facility enterprise operations" means additional nonlottery gaming facility
5.34products and services not owned, operated, or managed by the State Lottery which may
6.1be included in the overall development associated with the lottery gaming facility.
6.2Such operations may include, but are not limited to, restaurants, hotels, motels, parking
6.3structures, retail, spas, museums, or entertainment facilities.

6.4    Sec. 9. Minnesota Statutes 2010, section 349A.01, is amended by adding a subdivision
6.5to read:
6.6    Subd. 1b. Card club. "Card club" means a lottery gaming facility or portion of a
6.7lottery gaming facility where the director has authorized a lottery gaming facility manager
6.8to conduct card games.

6.9    Sec. 10. Minnesota Statutes 2010, section 349A.01, is amended by adding a
6.10subdivision to read:
6.11    Subd. 1c. Card game. "Card game" means a game or activity wherein individuals
6.12compete and wager utilizing a 52-unit system comprised of a series of numbers, numbered
6.13two through ten, and the letters J, Q, K, and A, combined with four symbols commonly
6.14known as hearts, diamonds, spades, and clubs, wherein each individual unit constitutes the
6.15display of one of the 52 possible combinations. The symbol commonly known as a joker
6.16may be incorporated into the system. Card game also includes the tile game of pai gow.

6.17    Sec. 11. Minnesota Statutes 2010, section 349A.01, is amended by adding a
6.18subdivision to read:
6.19    Subd. 5a. Electronic lottery credit. "Electronic lottery credit" means the basic unit
6.20of play for an electronic lottery terminal.

6.21    Sec. 12. Minnesota Statutes 2010, section 349A.01, is amended by adding a
6.22subdivision to read:
6.23    Subd. 5b. Electronic lottery credit receipt. "Electronic lottery credit receipt"
6.24means a receipt generated by an electronic lottery terminal that provides evidence of cash
6.25payment due a player from play on an electronic lottery terminal.

6.26    Sec. 13. Minnesota Statutes 2010, section 349A.01, is amended by adding a
6.27subdivision to read:
6.28    Subd. 5c. Electronic lottery game. "Electronic lottery game" means a game
6.29authorized by the director that is played on an electronic lottery terminal.

7.1    Sec. 14. Minnesota Statutes 2010, section 349A.01, is amended by adding a
7.2subdivision to read:
7.3    Subd. 5d. Electronic lottery terminal. "Electronic lottery terminal" means any
7.4mechanical, electrical, electromechanical, video, or other device, contrivance, or machine
7.5that, upon insertion of cash, tokens, credits, electronic cards, or similar objects therein,
7.6or upon payment of any consideration whatsoever, is available to play or operate, the
7.7play or operation of which, whether by reason of the skill of the operator or application
7.8of the element of chance, or both, may deliver or entitle the person playing or operating
7.9the machine to receive cash, tokens, merchandise, electronic lottery credit receipts or
7.10credits that may be redeemed for cash, whether the payoff is made automatically from the
7.11machine or in any manner whatsoever. Electronic lottery terminals may use bill validators
7.12and may be single-position multigame video electronic games, including, but not limited
7.13to, poker, blackjack, and slot machines. Electronic lottery terminals shall be directly
7.14linked to a central communications system at a location determined by the director for
7.15purposes of security, monitoring, and auditing.

7.16    Sec. 15. Minnesota Statutes 2010, section 349A.01, is amended by adding a
7.17subdivision to read:
7.18    Subd. 5e. Electronic lottery game revenues. "Electronic lottery game revenues"
7.19means the total of all amounts wagered through the operation of electronic lottery games
7.20at a lottery gaming facility, but excluding noncashable credits, including those in the
7.21form of free play, and other promotional items, less the total of all cash, credits, whether
7.22redeemed or unredeemed, or other prizes paid out as winnings to players.

7.23    Sec. 16. Minnesota Statutes 2010, section 349A.01, is amended by adding a
7.24subdivision to read:
7.25    Subd. 9a. Lottery facility game. "Lottery facility game" means any electronic
7.26lottery game, card game, or nonelectronic game that is authorized by the director to be
7.27conducted at the lottery gaming facility.

7.28    Sec. 17. Minnesota Statutes 2010, section 349A.01, is amended by adding a
7.29subdivision to read:
7.30    Subd. 9b. Lottery gaming enterprise. "Lottery gaming enterprise" means an
7.31entertainment enterprise which includes a lottery gaming facility, authorized pursuant to
7.32section 349A.17 and ancillary lottery gaming facility enterprise operations that have a
7.33coordinated business or marketing strategy.

8.1    Sec. 18. Minnesota Statutes 2010, section 349A.01, is amended by adding a
8.2subdivision to read:
8.3    Subd. 9c. Lottery gaming facility. "Lottery gaming facility" means that portion of
8.4a lottery gaming enterprise used for the purposes of operating, managing, and maintaining
8.5lottery facility games.

8.6    Sec. 19. Minnesota Statutes 2010, section 349A.01, is amended by adding a
8.7subdivision to read:
8.8    Subd. 9d. Lottery gaming facility management contract. "Lottery gaming
8.9facility management contract" means a contract or agreement between the director and
8.10the lottery gaming facility manager that authorizes the management, or construction and
8.11management, of a lottery gaming facility, the business of which is owned and operated by
8.12the Minnesota Lottery, negotiated and signed by the director on behalf of the state.

8.13    Sec. 20. Minnesota Statutes 2010, section 349A.01, is amended by adding a
8.14subdivision to read:
8.15    Subd. 9e. Lottery gaming facility manager. "Lottery gaming facility manager"
8.16means an individual, corporation, limited liability company, or other business entity
8.17authorized to construct and manage, or manage alone, a lottery gaming facility pursuant
8.18to a lottery gaming facility management contract with the Minnesota Lottery, on behalf
8.19of the state. A lottery gaming facility manager does not constitute a lottery vendor or a
8.20lottery retailer under this chapter.

8.21    Sec. 21. Minnesota Statutes 2010, section 349A.01, is amended by adding a
8.22subdivision to read:
8.23    Subd. 9f. Lottery gaming facility revenues. "Lottery gaming facility revenues"
8.24means the total of all amounts wagered through the operation of lottery facility games at a
8.25lottery gaming facility, but excluding noncashable credits, including those in the form of
8.26free play, and other promotional items, less the total of all cash; credits, whether redeemed
8.27or unredeemed; or other prizes paid out as winnings to players.

8.28    Sec. 22. Minnesota Statutes 2010, section 349A.01, subdivision 10, is amended to read:
8.29    Subd. 10. Lottery procurement contract. "Lottery procurement contract" means
8.30a contract to provide lottery products, computer hardware and software used to monitor
8.31sales of lottery tickets, and lottery tickets, and play on or maintenance of lottery facility
8.32games. A lottery gaming facility management contract is a lottery procurement contract.
9.1"Lottery procurement contract" does not include a contract to provide an annuity or prize
9.2payment agreement or materials, supplies, equipment, or services common to the ordinary
9.3operation of a state agency.

9.4    Sec. 23. Minnesota Statutes 2010, section 349A.01, subdivision 11, is amended to read:
9.5    Subd. 11. Lottery retailer. "Lottery retailer" means a person with whom the
9.6director has contracted to sell lottery tickets to the public. A lottery retailer does not
9.7include a lottery gaming facility manager.

9.8    Sec. 24. Minnesota Statutes 2010, section 349A.01, subdivision 12, is amended to read:
9.9    Subd. 12. Lottery ticket or ticket. "Lottery ticket" or "ticket" means any tangible
9.10evidence issued by the lottery to prove participation in a lottery game other than an
9.11electronic lottery game.

9.12    Sec. 25. Minnesota Statutes 2010, section 349A.01, is amended by adding a
9.13subdivision to read:
9.14    Subd. 14. Nonelectronic game. "Nonelectronic game" means any game other
9.15than an electronic lottery game which is authorized by the director to be operated at the
9.16lottery gaming facility.

9.17    Sec. 26. Minnesota Statutes 2010, section 349A.01, is amended by adding a
9.18subdivision to read:
9.19    Subd. 15. Nonelectronic game revenues. "Nonelectronic game revenues" means
9.20the total of all amounts wagered through the operation of nonelectronic games at a lottery
9.21gaming facility, but excluding noncashable credits, including those in the form of free
9.22play, and other promotional items, less the total of all cash; credits, whether redeemed or
9.23unredeemed; or other consideration paid out as winnings to players.

9.24    Sec. 27. Minnesota Statutes 2010, section 349A.02, subdivision 3, is amended to read:
9.25    Subd. 3. Powers and duties. In operating the lottery the director shall exercise
9.26the following powers and duties:
9.27(1) adopt rules and game procedures;
9.28(2) issue lottery retailer contracts and rule on appeals of decisions relating to those
9.29contracts;
9.30(3) enter into lottery procurement contracts for the provision of goods and services
9.31to the lottery;
10.1(4) employ personnel as are required to operate the lottery;
10.2(5) enter into written agreements with one or more government-authorized lotteries,
10.3or with an organization created and controlled by those lotteries, for the operation,
10.4marketing, and promotion of a joint lottery;
10.5(6) adopt and publish advertising and promotional materials consistent with section
10.6349A.09 ; and
10.7(7) operate a lottery gaming facility, consistent with section 349A.17; and
10.8(7) (8) take all necessary steps to ensure the integrity of, and public confidence
10.9in, the State Lottery.

10.10    Sec. 28. Minnesota Statutes 2010, section 349A.04, is amended to read:
10.11349A.04 LOTTERY GAME PROCEDURES.
10.12The director may adopt game procedures governing the following elements of the
10.13lottery:
10.14(1) lottery games;
10.15(2) ticket prices;
10.16(3) number and size of prizes;
10.17(4) methods of selecting winning tickets; and
10.18(5) frequency and method of drawings; and
10.19(6) lottery facility games.
10.20The adoption of lottery game procedures is not subject to chapter 14.

10.21    Sec. 29. Minnesota Statutes 2010, section 349A.06, subdivision 8, is amended to read:
10.22    Subd. 8. Proceeds of sales. All proceeds from the sale of lottery tickets received by
10.23a lottery retailer, and proceeds from the management of lottery facility games received by
10.24a lottery gaming facility manager constitute a trust fund until paid to the director. The
10.25lottery retailer or lottery gaming facility manager is personally liable for all proceeds.

10.26    Sec. 30. Minnesota Statutes 2010, section 349A.08, subdivision 1, is amended to read:
10.27    Subdivision 1. Agreement by players. A person who buys a lottery ticket or plays
10.28any lottery facility game agrees to be bound by the rules and game procedures applicable
10.29to the that particular lottery game for which the ticket is purchased, or a lottery facility
10.30game. The player acknowledges that the determination of whether a ticket or electronic
10.31lottery credit receipt is a valid winning ticket is subject to the rules of and game procedures
10.32adopted by the director, claims procedures established by the director for that game, and
10.33any confidential or public validation tests established by the director for that game.

11.1    Sec. 31. Minnesota Statutes 2010, section 349A.08, subdivision 5, is amended to read:
11.2    Subd. 5. Payment; unclaimed prizes. (a) Except as provided in this subdivision, a
11.3prize in the state lottery must be claimed by the winner within one year of the date of the
11.4drawing at which the prize was awarded or the last day sales were authorized for a game
11.5where a prize was determined in a manner other than by means of a drawing. If a valid
11.6claim is not made for a prize payable directly by the lottery by the end of this period, the
11.7prize money is considered unclaimed and the winner of the prize shall have no further
11.8claim to the prize.
11.9(b) An electronic lottery credit receipt from an electronic lottery terminal must be
11.10presented to a lottery gaming facility manager for payment within six months of the
11.11date the electronic lottery credit receipt was printed. If a valid claim for an electronic
11.12lottery credit receipt is not made within six months, the electronic lottery credit receipt
11.13is considered unclaimed and the player shall have no further claim to the amount due
11.14from the electronic lottery credit receipt.
11.15(c) A prize won by a person who purchased the winning ticket or played an
11.16electronic lottery game in violation of section 349A.12, subdivision 1, or won by a person
11.17ineligible to be awarded a prize under subdivision 7 must be treated as an unclaimed
11.18prize under this section.
11.19(d) The director must transfer all unclaimed prize money and money from unclaimed
11.20electronic lottery credit receipts under paragraph (b) at the end of each fiscal year from the
11.21lottery cash flow account to the general fund.

11.22    Sec. 32. Minnesota Statutes 2010, section 349A.08, subdivision 8, is amended to read:
11.23    Subd. 8. Withholding of delinquent state taxes or other debts. The director
11.24shall report the name, address, and Social Security number of each winner of a lottery
11.25prize of $600 or more, to the Department of Revenue to determine whether the person
11.26who has won the prize is delinquent in payment of state taxes or owes a debt as defined in
11.27section 270A.03, subdivision 5. If the person is delinquent in payment of state taxes or
11.28owes a debt as defined in section 270A.03, subdivision 5, the director shall withhold the
11.29delinquent amount from the person's prize for remittance to the Department of Revenue
11.30for payment of the delinquent taxes or distribution to a claimant agency in accordance
11.31with chapter 270A. Section 270A.10 applies to the priority of claims. In the case of a prize
11.32won at a lottery gaming facility under section 349A.17, the director shall report winners of
11.33prizes to the Department of Revenue as required by federal law.

11.34    Sec. 33. Minnesota Statutes 2010, section 349A.10, subdivision 2, is amended to read:
12.1    Subd. 2. Deposit in prize fund. (a) The director shall establish a lottery prize
12.2fund outside the state treasury. The fund consists of all money deposited in it under this
12.3subdivision and all interest earned thereon.
12.4(b) The director shall deposit in the lottery prize fund, from gross receipts from the
12.5sale of lottery tickets, an amount sufficient to pay lottery prizes, other than prizes and
12.6winnings from a lottery gaming facility under section 349A.17, from the lottery prize
12.7fund according to the following provisions:
12.8(1) for games which require online terminal connections, the prizes paid in any fiscal
12.9year must be at least 45 percent of gross receipts from those games in that fiscal year;
12.10(2) for games which do not require online terminal connections, the prizes paid in any
12.11fiscal year must be at least the following percentages of gross receipts from those games:
12.12(i) 50 percent through fiscal year 1991;
12.13(ii) 55 percent from July 1, 1991, to June 30, 1992; and
12.14(iii) 60 percent thereafter.

12.15    Sec. 34. Minnesota Statutes 2010, section 349A.10, subdivision 5, is amended to read:
12.16    Subd. 5. Deposit of net proceeds. Within 30 days after the end of each month, the
12.17director shall deposit in the state treasury the net proceeds of the lottery, which is the
12.18balance in the lottery fund after transfers to the lottery prize fund and credits to the lottery
12.19operations account and the balance in the lottery fund from the operation of the lottery
12.20gaming facility after transfers required under section 349A.17, subdivision 12. Of the net
12.21proceeds, 40 percent must be credited to the Minnesota environment and natural resources
12.22trust fund and the remainder must be credited to the general fund.

12.23    Sec. 35. Minnesota Statutes 2010, section 349A.11, subdivision 1, is amended to read:
12.24    Subdivision 1. Lottery ticket; retailer. The director, an employee of the lottery,
12.25a member of the immediate family of the director or employee residing in the same
12.26household may not:
12.27(1) purchase a lottery ticket or participate in gambling at the lottery gaming facility
12.28established under section 349A.17; provided, except in cases where a lottery gaming
12.29facility manager has actual knowledge, a lottery gaming facility manager shall not bear
12.30any liability for violations of this subdivision by the director, an employee of the lottery,
12.31a member of the immediate family of the director or employee residing in the same
12.32household; or
12.33(2) have any personal pecuniary interest in any vendor holding a lottery procurement
12.34contract, or in any lottery retailer; or
13.1(3) receive any gift, gratuity, or other thing of value, excluding food or beverage,
13.2from any lottery vendor or lottery retailer, or person applying to be a retailer or vendor, in
13.3excess of $100 in any calendar year.

13.4    Sec. 36. Minnesota Statutes 2010, section 349A.13, is amended to read:
13.5349A.13 RESTRICTIONS.
13.6Nothing in this chapter:
13.7(1) authorizes the director to conduct a lottery game or contest the winner or winners
13.8of which are determined by the result of a sporting event other than a horse race conducted
13.9under chapter 240; or
13.10(2) authorizes the director to install or operate a lottery device operated by coin or
13.11currency which when operated determines the winner of a game; and
13.12(3) authorizes the director to sell pull-tabs as defined under section 349.12,
13.13subdivision 32 .

13.14    Sec. 37. [349A.17] OPERATION OF LOTTERY GAMING FACILITY.
13.15    Subdivision 1. Purpose. (a) The legislature hereby recognizes that gaming
13.16operations and activities are appropriate social and economic activities for state
13.17government to operate and regulate.
13.18(b) The legislature hereby finds and declares to be the public policy of this state that:
13.19(1) the development of a controlled gaming industry is important to the development
13.20of the economy of the state of Minnesota in that it will assist in the continuing growth of
13.21the tourism industry and thus will benefit the general welfare of our citizens;
13.22(2) the growth and success of gaming is dependent upon public confidence and trust
13.23that gaming activities and, in particular, lottery gaming facility activities are conducted
13.24honestly and are free from criminal and corruptive elements; and
13.25(3) public confidence and trust can only be maintained by strict regulation of all
13.26persons, practices, associations, and activities related to the operation of the gaming
13.27establishment and the manufacture, supply, and distribution of gaming devices and
13.28supplies.
13.29(c) The legislature hereby finds and determines to be the public policy of the state:
13.30(1) to authorize the Minnesota lottery director to solicit bids and negotiate and
13.31enter into contracts for the conduct and management of gaming activities at a lottery
13.32gaming facility as provided in this section as a useful economic development tool which
13.33can promote general economic development, increase employment, produce direct and
14.1indirect state and local revenues, and otherwise stimulate the overall economy of the state
14.2and the tourism and hospitality industries therein;
14.3(2) that all persons involved with the proposed lottery gaming facility, including the
14.4lottery gaming facility manager and manufacturers, suppliers, and distributors of certain
14.5gaming devices and equipment, shall therefore be licensed, regulated, and controlled in
14.6such a manner as to accomplish and promote the above public policies and, in general, to
14.7protect the public health, safety, morale, good order, and general welfare of our citizens;
14.8and
14.9(3) that the most effective method of obtaining and furthering the public policies
14.10and objectives described in this section and to minimize competition with existing
14.11facilities is to provide for the operation of a single official gaming establishment which
14.12is state-operated and permits the management to be publicly bid to a nongovernmental
14.13entity, thus allowing the state to derive revenues from the controlled gaming operation.
14.14(d) This section and amendments to it shall be known and cited as the "Minnesota
14.15Lottery Gaming Facility Act." The Minnesota Lottery Gaming Facility Act shall be part of
14.16and supplemental to the Minnesota State Lottery.
14.17    Subd. 2. Location. The director may operate one lottery gaming facility, to be
14.18located in a lottery gaming facility enterprise on Hennepin Avenue in the downtown
14.19entertainment billboard district of the city of Minneapolis, such location to be approved
14.20by the city of Minneapolis. The location must be suitable for both the permanent and an
14.21interim lottery gaming facility. The permanent facility must have a gaming floor plate of
14.22not less than 60,000 square feet. The lottery gaming facility is a nonsmoking facility.
14.23    Subd. 3. Types of gaming. The director shall provide for the types of gaming
14.24to be conducted at the lottery gaming facility and game procedures subject to section
14.25349A.04. Lottery facility games are permitted to the extent consistent with law. The
14.26director may permit the operation of up to 3,200 electronic gaming positions at the lottery
14.27gaming facility.
14.28    Subd. 4. Electronic lottery terminals. (a) All electronic lottery terminals at a
14.29lottery gaming facility may be owned or leased by the lottery gaming facility manager for
14.30the benefit of the director.
14.31(b) Electronic lottery terminals must be maintained by the lottery, or by the manager
14.32of a lottery gaming facility pursuant to this section, who is under the control and direction
14.33of the director.
14.34(c) The director must have a central communications system that monitors activities
14.35and provides auditing program information on each electronic lottery terminal at a lottery
14.36gaming facility.
15.1(d) The director must approve the general security arrangements associated with and
15.2relating to the operation of the electronic lottery terminals at a lottery gaming facility.
15.3(e) The director must own or be the licensee of the software for the electronic lottery
15.4terminals at the lottery gaming facility.
15.5(f) The director may implement other controls as are deemed necessary to ensure
15.6and maintain the integrity of electronic lottery terminals at a lottery gaming facility
15.7operated under this section.
15.8(g) The director shall examine prototypes of electronic lottery terminals and require
15.9that the manufacturer of the terminal pay the cost of the examination. The director may
15.10contract for the examination of electronic lottery terminals. The director may require
15.11working models of an electronic lottery terminal transported to the locations the director
15.12designates for testing, examination, and analysis. The manufacturer shall pay all costs of
15.13any testing, examination, analysis, and transportation of the terminal model.
15.14(h) Deactivation of terminal. The director may deactivate an electronic lottery
15.15terminal without notice if the lottery gaming facility manager has violated any provision
15.16of this chapter, rule, or provision of its contract with the director.
15.17    Subd. 5. Card club. (a) The director may authorize a card club or clubs to be
15.18operated at the lottery gaming facility authorized in this section.
15.19(b) The lottery gaming facility manager is responsible for conducting and
15.20supervising the card games, providing all necessary equipment, services, and personnel,
15.21and reimbursing the director for costs related to card club regulation and enforcement.
15.22(c) The lottery gaming facility manager may charge players for card games by
15.23deducting and retaining money from wagers, by charging a fee based on playing time, or
15.24by any other means authorized by the director.
15.25(d) The director may not authorize the lottery gaming facility manager to operate a
15.26card club unless the lottery gaming facility manager has submitted, and the director has
15.27approved, a plan of operation for card games. The director may withdraw authorization
15.28for operation of a card club at any time for a violation of a law or rules governing card
15.29club operations. The plan must set forth all necessary details for conducting card games,
15.30including, among other things:
15.31(1) specifying and defining all card games to be played, including all governing
15.32aspects of each game;
15.33(2) amount and method by which players will be charged for card games;
15.34(3) arrangements to ensure the security of card games;
15.35(4) designation of all employees of the operator who undertake supervisory positions
15.36related to card games; and
16.1(5) internal control systems for card games.
16.2    Subd. 6. Nonelectronic games. Nonelectronic games may be played at the lottery
16.3gaming facility as authorized by the director.
16.4    Subd. 7. Lottery gaming facility management contract; procedure. (a) Not more
16.5than 60 days after the effective date of this act, the director shall publish in the Minnesota
16.6State Register a notice regarding the process for soliciting proposals and approval of a
16.7lottery gaming facility management contract.
16.8(b) In selecting a lottery gaming facility manager the director must consider, at a
16.9minimum, the following factors:
16.10(1) the experience of the applicant in managing gaming facilities;
16.11(2) the competence, experience, and timely performance of an applicant in order
16.12to promote and ensure the security, honesty, fairness, and integrity of the operation and
16.13administration of the lottery gaming facility;
16.14(3) the financial and gaming controls proposed by the applicant;
16.15(4) the financial resources available to the applicant to support the required activities;
16.16(5) the proposed infrastructure, design, construction, and equipment proposed to
16.17be utilized for the lottery gaming facility;
16.18(6) the total investment that the applicant will make to the project;
16.19(7) the proposed start date for the operation of the lottery gaming facility in order to
16.20expedite the flow of revenues to the state;
16.21(8) the number and types of games proposed to be conducted at the lottery gaming
16.22facility;
16.23(9) the estimate of the total revenue to be received by the state from the operation of
16.24the lottery gaming facility under the management of the applicant;
16.25(10) the applicant's responsible gaming plan for the lottery gaming facility;
16.26(11) the applicant's experience and record in implementing a responsible gaming
16.27plan for a gaming facility;
16.28(12) any agreements or prospective agreements related to ancillary lottery gaming
16.29facility enterprise operations; and
16.30(13) the manner in which the applicant proposes that the lottery gaming facility will
16.31promote tourism and economic development.
16.32(c) The director shall select a lottery gaming facility manager within 90 days after
16.33the deadline for receipt of proposals, unless the director determines that no applicant who
16.34has submitted a proposal satisfies the standards contained in subdivision 8, paragraph (a)
16.35and accomplishes the policies of this act considering the factors contained in subdivision
16.367, paragraph (b).
17.1(d) Each application for a lottery gaming facility management contract must be
17.2accompanied by an application fee in the amount of $150,000. The director may use this
17.3fee for costs associated with the evaluation of the application. Any balance remaining
17.4after the evaluation and approval of a lottery gaming facility management contract shall be
17.5refunded to all of the applicants on a pro rata basis.
17.6    Subd. 8. Lottery gaming facility management contract. (a) The director shall not
17.7enter into a lottery gaming facility management contract unless:
17.8(1) the prospective lottery gaming facility manager, or any of its principals, at a
17.9minimum:
17.10(i) has sufficient access to financial resources to support the activities required of a
17.11lottery gaming facility manager under the Minnesota lottery act;
17.12(ii) is current in filing all applicable tax returns and in payment of all taxes, interest,
17.13and penalties owed to the state of Minnesota and any taxing subdivision where the
17.14prospective manager is located in the state of Minnesota, excluding items under formal
17.15appeal pursuant to applicable statutes;
17.16(iii) has experience developing projects of at least 100,000 square feet and at a cost
17.17which exceeds $100,000,000 in Minnesota within the last five years; and
17.18(iv) is comprised of owners the majority of whom are residents of Minnesota at the
17.19time of initial application, or are business entities that have been incorporated or organized
17.20in Minnesota for at least three years;
17.21(2) the director determines that the proposed lottery gaming enterprise consists of an
17.22investment in infrastructure, design construction, improvement and equipment, including
17.23the cost of electronic lottery terminals, and including ancillary lottery gaming facility
17.24enterprise operations, of at least $200,000,000. The director, in determining whether the
17.25minimum investment required by this subdivision is met, shall not include any amounts
17.26derived from or financed by state or local retailers' sales tax revenues; and
17.27(3) the director determines that the prospective lottery gaming facility manager will
17.28have site control over a facility to house the lottery gaming facility. The lottery gaming
17.29facility manager and the facility owner must negotiate terms for the occupation and use
17.30of the facility.
17.31(b) Any lottery gaming facility management contract approved by the director
17.32under this section must:
17.33(1) require the lottery gaming facility manager to design, construct, finance, improve,
17.34and equip the lottery gaming facility and lottery gaming facility enterprise;
17.35(2) have an initial term of 15 years from the date of opening of the lottery gaming
17.36facility, with at least two five-year automatic extensions, provided that there has been no
18.1uncured, material breach or default of the lottery gaming facility management contract. At
18.2the end of the term, the parties may negotiate in good faith for an additional term;
18.3(3) establish a mechanism to facilitate payment of lottery gaming facility expenses
18.4and payment of expenses of the State Lottery, and distribution of the state's share of the
18.5lottery gaming facility revenues;
18.6(4) establish the types of lottery facility games to be installed in the lottery gaming
18.7facility and the replacement schedule and cycle;
18.8(5) provide for the prospective lottery gaming facility manager, upon approval of
18.9the proposed lottery gaming facility management contract, to pay to the commissioner
18.10of management and budget a privilege fee of $50,000,000. Such fee shall be deposited
18.11in the general fund and may be paid in two equal installments. The first installment
18.12of $25,000,000 is due upon full execution of the lottery gaming facility management
18.13agreement, and the second installment of $25,000,000 is due on or before June 30, 2013;
18.14(6) incorporate terms and conditions for the ancillary lottery gaming facility
18.15enterprise operations;
18.16(7) provide that the director must approve the electronic lottery terminals; however,
18.17the lottery gaming facility manager may select the electronic lottery terminals to be placed
18.18in operation from those approved by the director and determine the mix and schedule for
18.19replacement, subject to the director's approval;
18.20(8) provide that the hours of operation for the lottery gaming facility shall be at
18.21the direction of the lottery gaming facility manager, and may be operated 24 hours per
18.22day, seven days per week;
18.23(9) provide that the lottery gaming facility manager may hire personnel, consistent
18.24with the provisions of subdivision 9;
18.25(10) designate as key employees, subject to approval of the director, any employees
18.26or contractors providing services or functions which are related to lottery gaming facility
18.27games authorized by a lottery gaming facility management contract;
18.28(11) include financing commitments for construction;
18.29(12) include a development agreement with the city governing body;
18.30(13) include a provision requiring prominent posting in the area where electronic and
18.31nonelectronic games are conducted, in a manner approved by the director, of the toll-free
18.32telephone number established by the commissioner of human services in connection with
18.33the compulsive gambling program established under section 245.98;
18.34(14) require the director and lottery gaming facility manager to establish a
18.35responsible gambling plan in consultation with the National Council on Problem
18.36Gambling or the Minnesota affiliate, and by January 15 of each year to submit a report
19.1to the legislature of not more than five pages setting forth the status of the responsible
19.2gambling plan;
19.3(15) allow the lottery gaming facility manager to manage the lottery gaming facility
19.4in a manner consistent with this act and applicable law, but shall place full, complete and
19.5ultimate ownership and operational control of the gaming operation of the lottery gaming
19.6facility with the Minnesota lottery. The Minnesota lottery shall not delegate and shall
19.7explicitly retain the power to overrule any action of the lottery gaming facility manager
19.8affecting the gaming operation without prior notice. The Minnesota lottery shall retain full
19.9control over all decisions concerning lottery gaming facility games;
19.10(16) include provisions for the director to oversee all lottery gaming facility
19.11operations, including, but not limited to: oversight of internal controls; oversight
19.12of security of facilities; performance of background investigations; determination of
19.13qualifications and credentialing of employees, contractors, and agents of the lottery
19.14gaming facility manager and of ancillary lottery gaming facility enterprise operations,
19.15auditing of lottery gaming facility revenues; enforcement of all state laws and maintenance
19.16of the integrity of gaming operations;
19.17(17) include enforceable provisions and liquidated damages to recover the privilege
19.18fee paid under this subdivision, plus interest on such amount, compounded annually at the
19.19statutory rate of interest if (i) for any reason other than a material breach of the lottery
19.20gaming facility manager's obligations under the lottery gaming facility management
19.21contract the lottery gaming facility manager is enjoined or otherwise prevented from
19.22constructing or conducting operations at the lottery gaming facility as provided for in this
19.23section, or (ii) the state authorizes the operation of a lottery gaming facility or a similar
19.24gaming facility prior to August 1, 2036;
19.25(18) include provisions requiring that contracts for construction and operation of
19.26the lottery gaming facility must include programs to provide for participation by small
19.27local businesses and minority communities in the workforces of contractors and the lottery
19.28gaming facility manager. The lottery gaming facility manager shall make good faith
19.29efforts to recruit and employ women and members of minority communities. The lottery
19.30gaming facility manager shall make good faith efforts to use minority and women-owned
19.31businesses;
19.32(19) include a provision with respect to the extension of credit by the lottery gaming
19.33facility manager;
19.34(20) include provisions allowing the director to approve the plan of operation,
19.35advertising, and the budget for the lottery gaming facility on a schedule to be agreed
19.36upon by the parties;
20.1(21) include accounting procedures to determine the lottery gaming facility
20.2revenues, promotional games, unclaimed prizes, and credits;
20.3(22) include minimum requirements for a lottery gaming facility manager to
20.4provide qualified oversight, security, and supervision of the lottery gaming facility games
20.5including the use of qualified personnel with experience in applicable technology;
20.6(23) include eligibility requirements for employees, contractors, or agents of a
20.7lottery gaming facility manager who will have responsibility for or involvement with
20.8actual gaming activities or for the handling of cash or tokens;
20.9(24) include background investigations to be performed by the lottery director or
20.10the director's agent;
20.11(25) include requirements for any employee, contractor, or agent of the lottery
20.12gaming facility manager or of any ancillary lottery gaming enterprise operation;
20.13(26) include provisions for termination of the management contract by either party
20.14for cause; and
20.15(27) include any other provision deemed necessary by the parties, including such
20.16other terms and restrictions as necessary to conduct any lottery gaming facility game in
20.17a legal and fair manner.
20.18(c) If a lottery gaming facility manager does not pay the first installment of the
20.19privilege fee within 30 days of execution of the lottery gaming facility management
20.20contract, the lottery gaming facility management contract shall be null and void.
20.21(d) A lottery gaming facility management contract shall not be transferred or
20.22encumbered without the approval of the director. The lottery facility management contract
20.23may be assignable for benefit of lenders, subject to the approval of the director, which
20.24shall not be unreasonably withheld.
20.25(e)(1) The Minnesota lottery shall be the licensee or owner of all software programs
20.26used at a lottery gaming facility for any lottery facility game.
20.27(2) A lottery gaming facility manager, on behalf of the state, shall purchase or lease
20.28for the Minnesota lottery all electronic lottery games. All electronic lottery games shall be
20.29subject to the ultimate control of the Minnesota lottery in accordance with this act.
20.30(f) The director may authorize the operation of an interim lottery gaming facility at
20.31the location selected in subdivision 2 pending completion of the permanent facility and
20.32may establish reasonable conditions for the interim operation. The operation of the interim
20.33lottery gaming facility shall be treated in the same manner as if it were conducted in the
20.34permanent facility, and must be managed by the lottery gaming facility manager.
20.35(g) The establishment and development of a lottery gaming enterprise is not subject
20.36to sections 116D.04, 473.165, and 473.173. Section 116J.994 does not apply to any
21.1transactions of any governmental entity related to the lottery gaming facility or public
21.2infrastructure, or to any tenant or other users of them.
21.3    Subd. 9. Personnel, vendors. (a) No person or entity that holds a lottery gaming
21.4facility management contract or a contract for the provision of goods or services to
21.5the director, may employ in any capacity that relates directly to lottery gaming facility
21.6operations, use as a vendor to the lottery gaming facility or have as an owner, officer, or
21.7director, any person who has been convicted within the previous five years of a felony or
21.8any crime involving fraud or misrepresentation or gambling-related offenses except that
21.9if an owner is a publicly traded company, this provision applies only to shareholders of
21.10such publicly traded companies holding five percent or more of such company's issued
21.11and outstanding equity securities.
21.12(b) The director shall investigate each employee or vendor under this subdivision
21.13to the extent the director considers necessary and may request the assistance of and may
21.14reimburse the Division of Alcohol and Gambling Enforcement in the investigation. All
21.15employees of the lottery gaming facility manager must be fingerprinted or furnish their
21.16fingerprints to the director. The director may determine classifications of vendors from
21.17which employees and owners of such vendors providing goods or services relating to the
21.18operation of the lottery gaming facility must be fingerprinted or furnish their fingerprints to
21.19the director. The director may charge an applicant an investigation fee to cover the cost of
21.20the investigation and shall from this fee reimburse the Division of Alcohol and Gambling
21.21Enforcement for its share of the cost of the investigation. The director may cooperate with
21.22national and international organizations and agencies in conducting investigations. The
21.23director has access to all criminal history data compiled by the Division of Alcohol and
21.24Gambling Enforcement on applicants and licensees under this subdivision.
21.25    Subd. 10. Prizes. A person who plays a lottery facility game at the lottery gaming
21.26facility agrees to be bound by the game procedures applicable to that game. The player
21.27acknowledges that the determination of winnings is subject to the rules of the director,
21.28game procedures and claim procedures established for that game, and any confidential or
21.29public validation procedures established by the director for that game.
21.30    Subd. 11. Restrictions. No person under age 21 shall play or make a wager on an
21.31electronic lottery terminal or any lottery facility games.
21.32    Subd. 12. Disposition of lottery gaming facility revenues. The lottery gaming
21.33facility manager shall transmit all lottery gaming facility revenue to the director. The
21.34director shall dispose of the lottery gaming facility revenues as follows:
21.35(1) 20 percent of the lottery gaming facility revenue shall be disposed of as provided
21.36in section 297A.651;
22.1(2) three percent of the lottery gaming facility revenues shall be paid to the city
22.2of Minneapolis, which amount shall be in lieu of any local tax, imposition, or fee in
22.3connection with the operation of the lottery gaming facility;
22.4(3) 72 percent of the lottery gaming facility revenue to the lottery gaming facility
22.5manager, subject to the terms of the lottery gaming facility management contract, to cover
22.6the operating expenses of the lottery gaming facility which include, but are not limited
22.7to, salaries and wages, fringe benefits, security, maintenance and repair, rent, occupancy
22.8expenses, debt service, ongoing capital expenditures, capital reserves, equipment
22.9purchase and replacement, and other purposes as provided in the lottery gaming facility
22.10management contract;
22.11(4) $1,000,000 shall be paid annually to the general fund and is appropriated to
22.12the commissioner of human services for the compulsive gambling treatment program
22.13established under section 245.98, provided that funds appropriated under this clause shall
22.14supplement and not replace existing state funding for these programs;
22.15(5) $500,000 shall be paid annually to the general fund and is appropriated to the
22.16gambling control board for a grant to the state affiliate recognized by the National Council
22.17on Problem Gambling to increase public awareness of problem gambling, education
22.18and training for individuals and organizations providing effective treatment services to
22.19problem gamblers and their families, and research relating to problem gambling, provided
22.20that funds appropriated under this clause shall supplement and not replace existing state
22.21funding for these programs; and
22.22(6) the remainder shall be considered net proceeds from the operation of the lottery
22.23gaming facility, from which the expenses of the lottery must be paid.
22.24    Subd. 13. Restrictions on lottery gaming facility manager. (a) A lottery gaming
22.25facility manager must keep a complete set of books of account, correspondence, and all
22.26other records necessary to show fully the manager's transactions, and make them available
22.27for inspection by employees of the lottery at all times during business hours. The director
22.28may require a lottery gaming facility manager to furnish information as the director deems
22.29necessary to carry out the purposes of this chapter. The lottery gaming facility manager
22.30will provide for an annual financial audit, at its own expense, and will provide the audited
22.31financial statements to the director.
22.32(b) A lottery gaming facility management agreement issued under this section may
22.33not be transferred or assigned without the approval of the director, such approval not to be
22.34unreasonably withheld.
23.1(c) Sale or transfer of ownership of the facility in which the lottery gaming facility
23.2is housed is permissible with the approval of the director, such approval not to be
23.3unreasonably withheld.
23.4(d) A lottery gaming facility manager must prominently post in the area where
23.5electronic lottery terminals are located, in a manner approved by the commissioner of
23.6human services, the toll-free telephone number established by the commissioner of
23.7human services in connection with the compulsive gambling program established under
23.8section 245.98.
23.9    Subd. 14. Charter limitation. Notwithstanding any law, charter, or ordinance to the
23.10contrary, it is hereby found and declared that the development, construction, and operation
23.11of a lottery gaming facility and lottery gaming facility enterprise within the area specified
23.12in this section is consistent with the adopted area plan, is the preferred site location, is a
23.13permitted land use, and constitutes lawful gambling.
23.14    Subd. 15. Local tax. No new or additional local sales or use tax shall be imposed on
23.15lottery facility gaming revenues at the lottery gaming facility unless the tax is applicable
23.16throughout the taxing jurisdiction. Notwithstanding charter or ordinance to the contrary, a
23.17local gambling tax may not be applied to the lottery gaming facility operations nor may
23.18any license fee, benefits, contribution, or disposition of revenues of a lottery gaming
23.19facility be assessed or determined by the city in which the lottery gaming facility is located
23.20other than as specifically set forth in this section. The admissions and amusements tax
23.21pursuant to Laws 1969, chapter 1092, may not be imposed on lottery facility gaming
23.22revenues, but may be imposed as authorized by law on ancillary lottery gaming facility
23.23enterprise operations.
23.24    Subd. 16. Local restrictions. A political subdivision may not require a license
23.25to operate a gaming machine or a lottery facility game, or to conduct other gambling
23.26devices under section 299L.07, restrict or regulate the placement of gaming machines,
23.27the conducting of other lottery facility games, or the hours of operation, or impose a tax
23.28or fee on the business of operating gaming machines or the conducting of other lottery
23.29facility games at the lottery gaming facility.

23.30    Sec. 38. Minnesota Statutes 2010, section 541.20, is amended to read:
23.31541.20 RECOVERY OF MONEY LOST.
23.32Every person who, by playing at cards, dice, or other game, or by betting on the hands
23.33or sides of such as are gambling, shall lose to any person so playing or betting any sum of
23.34money or any goods, and pays or delivers the same, or any part thereof, to the winner,
23.35may sue for and recover such money by a civil action, before any court of competent
24.1jurisdiction. For purposes of this section, gambling shall not include pari-mutuel wagering
24.2conducted under a license issued pursuant to chapter 240, purchase or sale of tickets in
24.3the state lottery, participation in any lottery facility game at a lottery gaming facility
24.4authorized under section 349A.17, or gambling authorized under chapters 349 and 349A.

24.5    Sec. 39. Minnesota Statutes 2010, section 541.21, is amended to read:
24.6541.21 COMMITMENTS FOR GAMBLING DEBT VOID.
24.7Every note, bill, bond, mortgage, or other security or conveyance in which the whole
24.8or any part of the consideration shall be for any money or goods won by gambling or
24.9playing at cards, dice, or any other game whatever, or by betting on the sides or hands
24.10of any person gambling, or for reimbursing or repaying any money knowingly lent or
24.11advanced at the time and place of such gambling or betting, or lent and advanced for any
24.12gambling or betting to any persons so gambling or betting, shall be void and of no effect
24.13as between the parties to the same, and as to all persons except such as hold or claim under
24.14them in good faith, without notice of the illegality of the consideration of such contract or
24.15conveyance. The provisions of this section shall not apply to: (1) pari-mutuel wagering
24.16conducted under a license issued pursuant to chapter 240; (2) purchase of tickets in the
24.17state lottery and participation in lottery facility games under chapter 349A; (3) gaming
24.18activities conducted pursuant to the Indian Gaming Regulatory Act, United States Code,
24.19title 25, section 2701 et seq.; or (4) lawful gambling activities permitted under chapter 349.

24.20    Sec. 40. Minnesota Statutes 2010, section 609.75, subdivision 3, is amended to read:
24.21    Subd. 3. What are not bets. The following are not bets:
24.22(1) a contract to insure, indemnify, guarantee or otherwise compensate another for a
24.23harm or loss sustained, even though the loss depends upon chance;
24.24(2) a contract for the purchase or sale at a future date of securities or other
24.25commodities;
24.26(3) offers of purses, prizes or premiums to the actual contestants in any bona fide
24.27contest for the determination of skill, speed, strength, endurance, or quality or to the bona
24.28fide owners of animals or other property entered in such a contest;
24.29(4) the game of bingo when conducted in compliance with sections 349.11 to 349.23;
24.30(5) a private social bet not part of or incidental to organized, commercialized, or
24.31systematic gambling;
24.32(6) the operation of equipment or the conduct of a raffle under sections 349.11 to
24.33349.22 , by an organization licensed by the Gambling Control Board or an organization
24.34exempt from licensing under section 349.166;
25.1(7) pari-mutuel betting on horse racing when the betting is conducted under chapter
25.2240; and
25.3(8) the purchase and sale of state lottery tickets and participation in lottery facility
25.4games at the state-operated lottery gaming facility under chapter 349A.

25.5    Sec. 41. Minnesota Statutes 2010, section 609.761, subdivision 2, is amended to read:
25.6    Subd. 2. State lottery. Sections 609.755 and 609.76 do not prohibit the operation
25.7of the state lottery or the sale, possession, or purchase of tickets for the state lottery or
25.8participation in lottery facility games at the state-operated lottery gaming facility under
25.9chapter 349A.

25.10    Sec. 42. FEDERAL EXEMPTION.
25.11(a) Pursuant to section 2 of the federal act entitled "An Act to Prohibit Transportation
25.12of Gambling Devices in Interstate and Foreign Commerce," United States Code, title 15,
25.13sections 1171 to 1177, the state of Minnesota, acting by and through the duly elected and
25.14qualified members of the legislature, does hereby in this section, and in accordance and
25.15compliance with the provisions of section 2 of such federal act, declare and proclaim that
25.16it is exempt from the provision of section 2 of such federal act to the extent that such
25.17gambling devices as described therein are being transported to or from the Minnesota State
25.18Lottery or to or from a lottery gaming facility or a location within the state of Minnesota
25.19where such gambling devices are authorized pursuant to Minnesota Statutes, chapter 349A.
25.20(b) All shipments of gambling devices, including slot machines, into any county of
25.21the state of Minnesota within which gaming operations are authorized, the registering,
25.22recording, and labeling of which has been duly had by the manufacturer or dealer thereof
25.23in accordance with United States Code, title 15, sections 1171 to 1177, sections 4 and 5
25.24of this act, shall be deemed legal shipments thereof into any such county within which
25.25gaming operations are authorized.

25.26    Sec. 43. LOCAL APPROVAL.
25.27Sections 1 to 42 are effective the day after compliance with Minnesota Statutes,
25.28section 645.021, subdivision 3, by the city council of the city of Minneapolis.

25.29    Sec. 44. LOTTERY BUDGET; LOTTERY GAMING FACILITY.
25.30The director of the State Lottery shall submit a budget for the operation and
25.31regulation of the lottery gaming facility authorized under Minnesota Statutes, section
25.32349A.17, to the commissioner of management and budget. Notwithstanding Minnesota
26.1Statutes, section 349A.10, subdivision 6, the director of the State Lottery may expend
26.2amounts necessary to operate and regulate the lottery gaming facility. Amounts expended
26.3by the director of the State Lottery for the operation and regulation of the lottery gaming
26.4facility in fiscal years 2013 and 2014 are not subject to the maximum amount set in law
26.5for the operation of the lottery.

26.6    Sec. 45. SEVERABILITY; SAVINGS.
26.7If any part of this act is found to be invalid because it is in conflict with a provision
26.8of the Constitution of the State of Minnesota or for any other reason, all other provisions
26.9of this act shall remain valid and any rights, remedies, and privileges that have been
26.10otherwise accrued by this act shall remain in effect and may be proceeded with and
26.11concluded under the provisions of this act.

26.12    Sec. 46. EFFECTIVE DATE.
26.13This act is effective the day following final enactment.