HB 103: "An Act establishing the State Gaming Commission; relating to the Alcoholic Beverage Control Board; relating to the regulation of card rooms and card games; relating to criminal history record checks; and relating to the regulation of alcoholic beverages."

00                             HOUSE BILL NO. 103                                                                          
01 "An Act establishing the State Gaming Commission; relating to the Alcoholic Beverage                                    
02 Control Board; relating to the regulation of card rooms and card games; relating to                                     
03 criminal history record checks; and relating to the regulation of alcoholic beverages."                                 
04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
05    * Section 1. The uncodified law of the State of Alaska is amended by adding a new section                          
06 to read:                                                                                                                
07 LEGISLATIVE INTENT. This Act is intended to benefit the people of the state by                                          
08 promoting tourism and assisting economic development. Comprehensive supervision by law                                  
09 enforcement and strict regulation of card rooms and card operations under this Act is intended                          
10 to maintain the confidence and trust of the public.                                                                     
11    * Sec. 2. AS 04.11.370(c) is amended to read:                                                                      
12 (c)  If the board receives notice from the Department of Revenue that a                                                 
13 licensee or permittee has violated a provision of AS 05.15 related to gambling or from                              
14 the State Gaming Commission that a licensee or permittee has violated a                                             
01       provision of AS 05.18 related to card games, the board                                                        
02                 (1)  may suspend the license or permit; and                                                             
03                 (2)  shall suspend the license or permit for a period of at least 30 days if                            
04       the offense is the person's second or subsequent violation of AS 05.15 related to                                 
05       gambling or AS 05.18 related to card games.                                                                   
06    * Sec. 3. AS 05 is amended by adding a new chapter to read:                                                        
07               Chapter 18. State Gaming Commission; Card Rooms.                                                        
08            Sec. 05.18.010. State Gaming Commission established; membership. (a)                                       
09       The State Gaming Commission is established in the Department of Revenue.                                          
10            (b)  The commission consists of three members as follows:                                                    
11 (1)  the lieutenant governor who shall serve as the chair of the                                                        
12       commission; and                                                                                                   
13 (2)  two members who are appointed by the governor and subject to                                                       
14       confirmation by the legislature in joint session.                                                                 
15 Sec. 05.18.020. Duties and powers of the commission. (a) The commission                                               
16       shall                                                                                                             
17 (1)  exercise jurisdiction and supervision, consistent with this chapter,                                               
18       over                                                                                                              
19                      (A)  licensed card operations in the state; and                                                    
20 (B)  persons in a card room where card operations are                                                                   
21            conducted;                                                                                                   
22                 (2)  determine the eligibility of an applicant for a license;                                           
23 (3)  select from among competing applicants the applicants that                                                         
24 promote the most economic development and that best serve the interests of the                                          
25       citizens of the state;                                                                                            
26 (4)  take appropriate administrative enforcement or disciplinary action                                                 
27       against a licensee under this chapter for a violation under this chapter;                                         
28 (5)  investigate an alleged violation of this chapter and require a                                                     
29       licensee to reimburse the commission for the costs of the investigation;                                          
30 (6)  establish fees for the review and investigation of an application for                                              
31       a license under this chapter;                                                                                     
01                 (7)  prescribe a form to be used by a licensee as an application for                                    
02       employment by potential employees of the card room;                                                               
03                 (8)  require a licensee to maintain records, including financial                                        
04       statements, in the manner prescribed by the commission;                                                           
05                 (9)  adopt regulations under AS 44.62 (Administrative Procedure Act)                                    
06       necessary to carry out the provisions of this chapter; the regulations must include                               
07                      (A)  the methods for conducting card games that may be played                                      
08            in card rooms;                                                                                               
09                      (B)  specifications relating to the form and amount of charges a                                   
10            card room may impose on a player for playing a card game in the card room;                                   
11 (C)  standards and procedures for the issuance, renewal, and                                                            
12            revocation of licenses;                                                                                      
13 (D)  other matters the commission considers necessary to carry                                                          
14            out the purposes of this chapter and to protect the public interest.                                         
15            (b)  The commission may                                                                                      
16                 (1)  conduct hearings under this chapter;                                                               
17 (2)  issue a subpoena to compel the attendance of a witness or a                                                        
18 subpoena duces tecum for the production of books, records, and other relevant                                           
19       documents necessary for an investigation under this chapter;                                                      
20                 (3)  administer an oath or affirmation to a witness;                                                    
21                 (4)  revoke, suspend, or renew a license issued under this chapter;                                     
22 (5)  hire employees to gather information, conduct investigations, and                                                  
23       carry out other tasks under this chapter;                                                                         
24 (6)  take appropriate actions to enforce this chapter, including the                                                    
25 issuance of a notice of violation of this chapter or a regulation of the commission, an                                 
26       order to cease and desist, or a closure order.                                                                    
27 Sec. 05.18.030. Card room license. (a) The commission may issue a license to                                          
28 operate a card room and conduct card games, including poker, blackjack, pai gow,                                        
29 super pan 9, and other card games approved by the commission in regulation, to a                                        
30       person who                                                                                                        
31                 (1)  submits an application on a form approved by the commission;                                       
01                 (2)  pays the license fee required under (c) of this section;                                           
02                 (3)  meets the qualifications required for licensure under this section;                                
03       and                                                                                                               
04 (4)  has been fingerprinted and has provided the fees required by the                                                   
05 Department of Public Safety under AS 12.62.160 for criminal justice information and                                     
06 a national criminal history record check; the fingerprints and fees shall be forwarded                                  
07 to the Department of Public Safety to obtain a report of criminal justice information                                   
08       under AS 12.62 and a national criminal history record check under AS 12.62.400.                                   
09            (b)  An applicant for a license under this chapter shall provide to the                                      
10       commission                                                                                                        
11 (1)  the name, business address, and business telephone number of the                                                   
12       applicant;                                                                                                        
13 (2)  if the applicant is an individual, an identification card of the                                                   
14       applicant;                                                                                                        
15                 (3)  if the applicant is not an individual,                                                             
16 (A)  the state of incorporation and any states where the                                                                
17            corporation is registered to do business;                                                                    
18                      (B)  the names and addresses of all corporate officers.                                            
19 (c)  An applicant for a license under this section shall pay a $100,000 license                                         
20 fee to be submitted with the application. The commission shall refund $50,000 of the                                    
21       license fee if the application is denied.                                                                         
22 (d)  A licensee under this section may not allow dice or electronic games in a                                          
23       card room or extend credit to a player in the card room.                                                          
24 (e)  The commission may approve the issuance and renewal of only one license                                            
25       under this section in each borough.                                                                               
26 (f)  A licensee under this section shall post on the licensed premises a sign                                           
27 providing information on gambling disorders and telephone numbers for resources and                                     
28 entities providing assistance for gambling disorders. The license holder shall display                                  
29 the sign in a manner and place conspicuous to a person gambling on the licensed                                         
30       premises.                                                                                                         
31 (g)  A card room may operate 24 hours a day, seven days a week, 365 days a                                              
01       year.                                                                                                             
02 Sec. 05.18.040. Factors considered in granting a license. The commission                                            
03 shall consider each proposal for a license and grant the license to the most competitive                                
04 applicant. In determining whether to grant a license to an applicant, the commission                                    
05       shall consider                                                                                                    
06                 (1)  the applicant's gaming experience, management, and ownership;                                      
07                 (2)  the applicant's financial fitness and capability;                                                  
08                 (3)  the proposed facility, investment, and amenities; and                                              
09                 (4)  any other relevant factors.                                                                        
10 Sec. 05.18.050. Tournaments. A licensee shall host a card tournament at least                                         
11 once each calendar quarter, with the proceeds of the tournament to be distributed to a                                  
12 nonprofit educational institution or group designated by the licensee. An application                                   
13 for issuance or renewal of a license issued under this chapter must include proposed                                    
14 dates for the tournaments and specify the nonprofit educational institution or group                                    
15 designated to benefit from each tournament. The licensee shall notify the commission                                    
16 of any change in the date or beneficiary of a tournament. A nonprofit educational                                       
17 institution or group may be the designated beneficiary of only one tournament under                                     
18       this section each year.                                                                                           
19 Sec. 05.18.060. Transfer of licenses; rules of procedure; prohibitions. (a)                                           
20 The holder of a license under this chapter or another person shall apply for and must                                   
21 receive the commission's approval before the holder's license is transferred, sold, or                                  
22 purchased or a voting trust agreement or other similar agreement is established with                                    
23 respect to the license. The holder of a license under this chapter or another person may                                
24       not lease, hypothecate, or borrow or loan money against the holder's license.                                   
25 (b)  The commission shall adopt regulations governing the procedure for an                                              
26 action under (a) of this section. The regulations must specify that a person who obtains                                
27 an ownership interest in a license must meet the criteria of this chapter and regulations                               
28 adopted by the commission. The holder of a license under this chapter may transfer the                                  
29 holder's license only in accordance with this chapter and regulations adopted by the                                    
30       commission.                                                                                                       
31 Sec. 05.18.070. Gross receipts tax. A tax is imposed on the gross receipts                                            
01       received from card games authorized under this chapter at the rate of 9.5 percent of the                          
02       amount of the gross receipts.                                                                                     
03            Sec. 05.18.080. Persons under 21 years of age. (a) A person who is under 21                                
04       years of age may not be present in a card room.                                                                 
05            (b)  A person who is under 21 years of age may not make a wager under this                                   
06       chapter.                                                                                                          
07            Sec. 05.18.090. Violations of chapter; fraudulent acts. If a licensee or an                                
08       employee of a licensee violates this chapter or engages in a fraudulent act, the                                  
09       commission may                                                                                                  
10                 (1)  suspend, revoke, or restrict the license of a licensee;                                            
11 (2)  require the removal of a licensee or an employee of a licensee from                                                
12       the card room;                                                                                                    
13 (3)  impose for each violation of this chapter by a licensee a penalty of                                               
14 not more than the greater of $10,000 or an amount equal to the licensee's daily gross                                   
15       receipts for each day of the violation.                                                                           
16 Sec. 05.18.100. Notice to the alcoholic beverage control board. If, after                                             
17 notice and hearing, the commission determines that a person has violated a provision                                    
18 of this chapter related to card games and the person is a licensee or permittee under                                   
19 AS 04, the commission shall provide notice of the violation to the Alcoholic Beverage                                   
20       Control Board.                                                                                                    
21 Sec. 05.18.110. Crimes. A person commits a class A misdemeanor if the                                                 
22       person knowingly                                                                                                  
23 (1)  makes a false statement on an application submitted under this                                                     
24       chapter;                                                                                                          
25 (2)  operates a card operation in which wagering is conducted or is to                                                  
26       be conducted in a manner other than the manner required under this chapter;                                       
27                 (3)  permits a person under 21 years of age to make a wager;                                            
28 (4)  aids, induces, or causes a person under 21 years of age to enter or                                                
29       attempt to enter the card room;                                                                                   
30 (5)  makes a false statement on an application submitted to the                                                         
31       commission under this chapter; or                                                                                 
01                 (6)  enters or attempts to enter a card room if the person is under 21                                  
02       years of age.                                                                                                     
03            Sec. 05.18.200. Definitions. In this chapter,                                                              
04                 (1)  "card game" means a banked or nonbanked game using playing                                         
05       cards as the primary device to play the game;                                                                     
06                 (2)  "card room" means a structure or part of a structure in which a card                               
07       game authorized under this chapter is conducted by a person licensed under this                                   
08       chapter;                                                                                                          
09                 (3)  "commission" means the State Gaming Commission;                                                    
10 (4)  "gross receipts" means the total amount of money exchanged for                                                     
11       the purchase of chips, tokens, or electronic cards by card room patrons;                                          
12                 (5)  "licensee" means the holder of a license issued under this chapter.                                
13    * Sec. 4. AS 11.66.280(3) is amended to read:                                                                      
14 (3)  "gambling" means that a person stakes or risks something of value                                                  
15 upon the outcome of a contest of chance or a future contingent event not under the                                      
16 person's control or influence, upon an agreement or understanding that that person or                                   
17 someone else will receive something of value in the event of a certain outcome;                                         
18       "gambling" does not include                                                                                       
19 (A)  bona fide business transactions valid under the law of                                                             
20 contracts for the purchase or sale at a future date of securities or commodities                                        
21 and agreements to compensate for loss caused by the happening of chance,                                                
22 including contracts of indemnity or guaranty and life, health, or accident                                              
23            insurance;                                                                                                   
24                      (B)  playing an amusement device that                                                              
25 (i)  confers only an immediate right of replay not                                                                      
26 exchangeable for something of value other than the privilege of                                                         
27 immediate replay and does not contain a method or device by which the                                                   
28                 privilege of immediate replay may be cancelled or revoked;                                              
29 (ii)  confers only tickets, credits, allowances, tokens, or                                                             
30 anything of value that can be redeemed for toys, candy, or electronic                                                   
31 novelties offered at the same facility where the amusement device is                                                    
01                 located; or                                                                                             
02                           (iii)  allows a player to manipulate a claw machine or                                        
03                 similar device within an enclosure and enables a person to receive                                      
04                 merchandise directly from the machine;                                                                  
05                      (C)  an activity authorized by the Department of Revenue under                                     
06            AS 05.15 or the State Gaming Commission under AS 05.18; or                                               
07                      (D)  the permanent fund dividend raffle authorized under                                           
08            AS 43.23.230;                                                                                                
09    * Sec. 5. AS 12.62.400(a) is amended by adding a new paragraph to read:                                            
10                 (21)  licensure to operate a card room and conduct card games under                                     
11       AS 05.18.020.                                                                                                     
12    * Sec. 6. AS 39.50.200(b) is amended by adding a new paragraph to read:                                            
13                 (65)  State Gaming Commission (AS 05.18).                                                               
14    * Sec. 7. AS 44.64.030(a)(2) is amended to read:                                                                   
15                 (2)  AS 05.15 and AS 05.18 (charitable gaming; card rooms);                                     
16    * Sec. 8. AS 04.16.175 and 04.16.220(a)(5) are repealed.