Legislature(1993 - 1994)
04/17/1993 09:40 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CS FOR SENATE BILL NO. 76(JUD):
An Act requiring regulations relating to pull-tabs
adopted by the Department of Commerce and Economic
Development to be consistent with the North American
Gaming Regulators Association standards on pull-tabs;
allowing permittees to contract with vendors to sell
pull-tabs on behalf of the permittee; restricting the
purchase of pull-tabs by certain persons; requiring the
sale of pull-tabs by vendors to be solely by a pull-tab
ticket dispensing machine; requiring receipts before
certain prizes may be paid; prohibiting distributors
from supplying pull-tabs to vendors; relating to
registration of vendors; requiring the licensing of
out-of-state manufacturers; allowing public or
nonprofit broadcasting stations to sell pull-tabs at
more than one location; preventing persons with certain
convictions from being involved in charitable gaming
activities as a permittee, licensee, vendor, person
responsible for an activity, fund raiser or consultant
of a licensee, or employee in a managerial or
supervisory capacity and providing exceptions for
certain persons whose convictions are at least 10 years
old; relating to multiple-beneficiary charitable gaming
permits and door prizes for charitable gaming;
requiring Department of Commerce and Economic
Development approval of contracts between charitable
gaming permittees and operators before gaming may
occur; limiting the amount of authorized expenses to a
percentage of adjusted gross income for a charitable
gaming activity; relating to the reporting and payment
of a percentage of the adjusted gross income by
operators to permittees; requiring Department of
Commerce and Economic Development approval of contracts
between permittees and operators; allowing the
commissioner of commerce and economic development to
issue orders prohibiting violations of state gaming
laws; relating to the authority of the commissioner of
commerce and economic development to suspend or revoke
a permit, license, or registration; relating to the
uses to which charitable gaming proceeds may be put;
relating to `political uses' and `political
organizations' as those terms are used in the
charitable gaming statutes; and providing for an
effective date.
Senator Sharp MOVED to RESCIND prior committee action
adopting CSSB 76(FIN) work draft "M" and amendment 1. No
objections being heard, prior action was RESCINDED.
Senator Sharp MOVED for ADOPTION of CSSB 76(FIN) work draft
"S" dated April 16, 1993. No objections being heard, it was
ADOPTED. Co-chair Pearce outlined the changes in CSSB
76(FIN) work draft "S". She said that felony exclusions
remained in the bill, net proceeds from pull tabs and bingo
(not raffle proceeds) are prohibited for direct campaign
contributions to candidates as in the prior bill, net
proceeds are also prohibited for payment to registered
lobbyists, third party vendor language has been tightened,
multiple beneficiary permits allowed, the APRN section has
been removed, and language was removed allowing the use of
vendor machines for pull tabs. She said that an amendment
had been prepared to allow package stores to participate in
the sale of pull tabs. She invited John Hansen, Jr., Gaming
Manager, Department of Commerce & Economic Development to
rejoin the members at the table.
Senator Sharp MOVED for ADOPTION of amendment 1 on page 15,
line 16 of CSSB 76(FIN) work draft "S". Mr. Hansen said
that amendment 1 was a technical amendment that would give
an exception to the Department of Labor that would allow 16
to 19 year olds to work in restaurants where pull tabs are
sold. The way the bill is drafted, it basically excludes
those establishments from being able to sell pull tabs as
vendors. No objections being heard, amendment 1 was
ADOPTED.
Senator Sharp MOVED for ADOPTION of amendment 2 on page 15,
line 11, with consideration of the title. Co-chair Pearce
explained that amendment 2 would add package store licenses
back into the third party vendor. In answer to Co-chair
Pearce, Mr. Hansen said that package stores were at the
present time selling pull tabs in Alaska. No objections
being heard, amendment 2 was ADOPTED.
Mr. Hansen said that currently in Alaska pull tabs are
authorized and allowed to be sold in any location. This
bill would provide for permittees to go directly to bars and
liquor stores and receive a minimum of 50 percent of the net
proceeds at the time they deliver the pull tabs. Under
current, these sales are occurring using operators or
permittees. When they use an operator they receive a
minimum of 15 percent of net proceeds, that minimum is
usually the maximum. Discussion was had by Mr. Hansen and
Senator Kelly regarding net proceeds, expenses and profit.
Co-chair Pearce invited Paul Fuhs, Commissioner, Department
of Commerce & Economic Development, to come before the
committee again and speak to SB 76. Mr. Fuhs said that the
Governor was opposed to gambling but if the state was going
to authorize it, he felt profits should be going to the
charities. He said that gaming associations were opposed to
the legislation. He explained that every bar could have
pull tabs under the existing law, and of the 1,320 permittee
locations in Alaska, 537 are bars. The advantage of this
legislation is that the charities would get 50 percent
instead of 15 percent under existing legislation. He said
that his department was in support of prohibiting proceeds
for use for campaign contributions.
Discussion was had by Senator Kelly, Mr. Fuhs and Co-chair
Pearce regarding the difference between using third party
vendors and operators. Mr. Fuhs estimated that the
combination of stopping the diversion of gaming proceeds to
campaign contributions and lobbyists and the increase in the
percentages would result in about $10 million more a year
going to charities than under existing legislation. He said
that about $16 million net goes to charities at the present
time.
Co-chair said that a new fiscal note for the Department of
Revenue shows $86.9 but because of the addition of an
auditor position it could provide $100.0 additional revenue
for the department.
Senator Rieger asks for clarification regarding permittees
expenses. Mr. Hansen said that under CSSB 76(FIN), if a
permittee chooses to use an operator or a vendor, or
operates the game out of their own bingo hall, they are not
going to be allowed to use more than 70 percent of the
adjusted gross income for overall expenses which leaves 30
percent for charities.
Senator Kelly MOVED for ADOPTION of amendment 3 adding a
comma and the words "directly or indirectly" after the word
"portion" on page 9, line 19. No objections being heard,
amendment 3 was ADOPTED.
Senator Kelly MOVED for passage of CSSB 76(FIN) as amended
with individual recommendations. CSSB 76(FIN) work draft
"S" was REPORTED OUT of committee as amended with a "do
pass" and with a zero fiscal note for the Department of
Commerce & Economic Development and a new fiscal note for
the Department of Revenue in the amount of $86.9. Co-chairs
Pearce and Frank, Senators Jacko, Kelly, Sharp and Rieger
signed "do pass." Senator Kerttula signed "no rec."
ADJOURNMENT
The meeting was adjourned at approximately 12:40 p.m.
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