Legislature(2015 - 2016)BELTZ 105 (TSBldg)
02/01/2016 01:30 PM Senate JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| Partners for Progress Reentry Center Overview: No-cost and Cost-bending Ways to Improve Community Reentry and Reduce Recidivism | |
| SB157 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | SB 157 | TELECONFERENCED | |
| += | SB 41 | TELECONFERENCED | |
SB 157-AMUSEMENT DEVICES & GAMBLING DEFINITION
2:21:57 PM
CHAIR MCGUIRE announced the consideration of SB 157.
FORREST WOLFE, Staff, Senator Lesil McGuire, sponsor of SB 157,
introduced the legislation on behalf of the sponsor speaking to
the following sponsor statement:
SB 157 is a housekeeping measure that aims to clarify
that restaurants featuring arcade-style amusement
games may lawfully operate in Alaska. Elsewhere in the
United States, popular restaurant businesses feature
arcade areas where patrons play games of skill to win
tickets which can then be redeemed for toys and other
novelties. Unfortunately, Alaska's outdated laws are
so vague that the legality of these operations is far
from clear. SB 157 would clarify that playing these
arcade-style amusement games of skill, winning tickets
and redeeming them for small, non-cash prizes does not
constitute gambling under Alaska law. By clarifying
this issue, the risk for companies seeking to do
business in Alaska will be eliminated.
These family-friendly businesses can be significant
additions to Alaska's economy. For example, Dave &
Busters is seeking to open a location at the Dimond
Center mall in Anchorage. It is anticipated that Dave
& Buster's will spend approximately $10 million to
build said location, and once operational will employ
approximately 140-160 workers. Moreover, this addition
to the Dimond Center is the keystone to a much larger
renovation project for the mall that is anticipated to
employ approximately 200 construction workers. In this
time of economic uncertainty, this is an effective way
to add well-paying jobs to Alaska's economy. Passage
of this bill will give businesses like Dave & Buster's
the sure-footed legal ground to move ahead with their
plans.
Finally, it should be made absolutely clear that this
narrow bill does not in any way legalize traditional
gambling, nor does it legalize casino-style video
gambling such as video poker, slots, or roulette. Once
again, this bill only clarifies that arcade-style
operations that award tickets to be redeemed for toys
and other novelties are lawful.
2:24:42 PM
HUGH ASHLOCK, owner, Dimond Center Mall (DCM), Anchorage,
Alaska, said this is an Alaskan and family-owned shopping center
that receives over 12 million visits annually. He explained that
DCM is in the middle of a $50 million expansion and renovation
project. He reviewed the progress thus far and relayed that Dave
and Buster's would be a 44,000 square foot addition on top of
the shopping center. "Dave and Buster's will spend $10 million,
we would spend an additional $13 million." Aside from the
estimated 200 construction jobs, there will be about 100 offsite
ancillary construction jobs. He described Dave and Buster's as a
serious anchor for the Dimond Center Mall.
CHAIR MCGUIRE expressed support for the project, a preference
for using both a union and non-union workforce, and providing
renewable or sustainable energy systems to the degree possible.
MR. ASHLOCK said this will be a highly skilled project and to
get that level of talent in Alaska a union shop is necessary. He
reported that the project will use the newest energy saving HVAC
systems and the parking lot has already been converted to high
density, high lumen and lighting.
CHAIR MCGUIRE enthused about new building projects that add
jobs.
SENATOR COGHILL commented that the investment is great and the
bill clarifies the issue of gaming.
2:30:04 PM
HOWARD TRICKEY, representing Dave and Busters, Anchorage,
Alaska, said he would provide background and context to explain
the Dave and Buster's business model, and the reason the change
in law is needed.
He explained that Dave and Buster's was formed in 1982 and is
not a franchise. It is currently in 80 locations in more than 30
states and employs [12,000] nationally. The business model is to
provide family fun and the establishments are for playing a
variety of amusement games. The company has well-developed and
effective policies prohibiting guests under age 18 without a
parent or guardian. The employees are trained using a nationally
recognized program that is known as "Certified to Serve Safe."
This is a family-friendly environment designed to have fun while
patrons watch sports games, play games, or enjoy fine dining.
Dave and Buster's offers two types of games in the arcade. One
is skill-based where strategy, timing, and dexterity is used to
determine the outcome of the game. About 65 percent of the games
are this type. The second type are simulation games. These
include simulations of flying an aircraft or driving in the
Indianapolis 500. The criteria for selecting games for the
arcade is those that assess and evaluate a player's skill.
Players earn tickets that can be redeemed onsite where there are
a variety of prizes that range in value. Tickets can be redeemed
immediately or the customer can save tickets and redeem them in
the future.
MR. TRICKEY stated that this amendment was requested to define
amusement devices whose outcome is determined predominantly by
the skill and ability of the player. He said the definition is
needed because of an outdated 2001 attorney general opinion that
concluded that a video golf game that was programed to include
significant elements of chance did constitute gambling. Under
that opinion, Dave and Buster's would face some uncertainty if
they went forward with the proposed investment at Dimond Center
Mall.
He explained that the bill adds a new Section 3 that defined
amusement devices in both a positive and negative sense. The
bill positively defines what constitutes "amusement device" and
then describes the games that are excluded. The excluded types
of games are video forms of casino style games that would
constitute a gambling activity.
The bill adds a new paragraph to define amusement device. It
clarifies that playing an amusement device is not gambling and
earning tickets that can be redeemed for a prize is not gambling
either. In no other way does the bill change the definition of
what is a game of chance and what constitutes value.
2:39:05 PM
SENATOR WIELECHOWSKI asked, "As I'm reading this, Chuck E.
Cheese is illegal?"
MR. TRICKEY replied the franchisee is probably taking a
calculated business risk based on the 2001 attorney general
opinion.
SENATOR WIELECHOWSKI referenced page 2, line 6, and asked if he
had a definition for "electronic novelty."
MR. TRICKEY replied the term isn't defined but the intention is
to allow electronic prizes that customers can redeem with
tickets. He noted that one of the prizes is an IPad.
SENATOR WIELECHOWSKI wondered whether there should be a limit on
the toy, candy, or electronic novelty or the value of
merchandise in a claw machine or similar device.
MR. TRICKEY offered his belief that it should be a matter of
personal family choice for the Dave and Buster's customers. "I
don't see why the legislature would want to place a value on it
in a way that would make it more difficult for the business
model to be successful."
SENATOR WIELECHOWSKI referenced page 2, line 27, and asked if he
had a definition for "casino games." He said he's trying to
build a record in the event that someone wants to come in with
other types of games.
MR. TRICKEY explained that, "By listing what's excluded, we
developed a clear category of games that would not be
permitted," he said.
2:44:44 PM
SENATOR WIELECHOWSKI noted that one of the documents in the
packet discusses site criteria, one of which is 500,000 to 1
million residences within 10 miles. He asked if Dave and
Buster's is making an exception for that, because Anchorage does
not meet that criterion.
MR. TRICKEY suggested the question may be better for Mr. Ashlock
or Mr. Tobin, but his understanding is that the Dimond Center
Mall was selected because it is a statewide center.
CHAIR MCGUIRE related that when she first enquired about getting
a Dave and Buster's in Anchorage she was told the threshold was
1 million. She offered her belief that Dave and Buster's has
found that Alaska is a good opportunity, despite the original
entry requirements. "As a broader economic development point of
view for us here in the legislature, I think this is a good
trend."
She asked Mr. Ashlock to address the question.
2:47:51 PM
MR. ASHLOCK reported that Anchorage is number 2 in eating out in
the U.S. at $6,900 per capita. New York is number 1 at $7,100
per capita and San Francisco is number 3 at $6,100 per capita.
Much like Honolulu, Anchorage serves as a regional magnet and
hub for medicine, entertainment, shopping, and international
travelers. It's a perfect model for Dave and Buster's to select.
2:49:18 PM
JAY TOBIN, General Counsel, Dave and Buster, Dallas, Texas,
clarified that Dave and Buster's has more than 12,000 employees
nationally. It has been a publicly traded company since October
2014 and the stock is listed on the NASDAQ. He explained that
Dave and Buster's tagline is the opportunity to eat, drink,
play, and watch. As mentioned previously, this development will
be over 40,000 square feet and will have a full service
restaurant with a full service bar. In addition there will be a
full service sports bar, an area dedicated to private events,
and a midway center for playing a variety of games.
He clarified that these games are not allowed to dispense cash
or cash equivalents. Addressing the site criteria question, he
related that over time Dave and Buster's has learned to
experiment, opening stores in locations that traditionally
wouldn't fit the population requirement. He described the
different reasons for openings in Panama City, Florida, Orlando,
Florida and Virginia Beach, Virginia. The reasons for opening a
location in Anchorage are multifold but primarily it's that the
market is unique. Anchorage has a fulltime population, the
municipality and Dimond Center are a significant draw from
throughout the state, and national and international tourism is
pulled in. Furthermore, the attention to detail and significant
quality offered by Mr. Ashlock was very important in making the
decision.
2:56:06 PM
CHAIR MCGUIRE commented that this bodes well for the future of
Anchorage. She mentioned the amazing military population in the
state and asked him to relay a request to consider both college
and military discounts, charitable giving, and partnerships with
rural communities to enhance opportunities.
SENATOR COGHILL observed that the definitions that are in the
negative may be problematic.
SENATOR COSTELLO summarized that this legislation clarifies and
rectifies a situation for a specific business. She cautioned the
committee to think about this broadly statewide to ensure that
there are no unintended consequences. She questioned, for
example, how pull tabs might be affected.
CHAIR MCGUIRE said her staff has worked diligently to be clear
that this is not about legalizing gambling. She committed her
staff and the drafter to work with the members to ensure that
any concerns are addressed. She said she likes the notion of
limiting the value of the prizes to protect vulnerable
populations.
CHAIR MCGUIRE announced she would hold SB 157 in committee for
further consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Partners for Progress- No Cost Improvements.pdf |
SJUD 2/1/2016 1:30:00 PM |
|
| Partners for Progress Presentation.pdf |
SJUD 2/1/2016 1:30:00 PM |
|
| Partners For Progress Statistics.pdf |
SJUD 2/1/2016 1:30:00 PM |
Partners Reentry Center Statistics |
| SB 157 Dave Buster's Renderings.pdf |
SJUD 2/1/2016 1:30:00 PM |
SB 157 |
| SB 157 Dimond Mall Floor Plans.pdf |
SJUD 2/1/2016 1:30:00 PM |
SB 157 |
| SB 157 Dimond Mall Renderings.pdf |
SJUD 2/1/2016 1:30:00 PM |
SB 157 |
| SB 157 Sponsor Statement (002).pdf |
SJUD 2/1/2016 1:30:00 PM |
SB 157 |