Legislature(1995 - 1996)
04/07/1995 01:39 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 145 CHARIT.GAMING:PRIZES,REPORTS,PENALTY CHAIRMAN ROBIN TAYLOR called the Judiciary Committee meeting to order at 1:39 p.m. The first order of business before the committee was SB 145. PORTIA BABCOCK, committee aide to the Senate HESS committee, stated the following. SB 145 makes reporting changes to bingo and pull tab operations, and prohibits operators from cashing public assistance checks. The bill creates a mechanism to log and track winners of cash prizes. Under current law, the winner must sign for the prize money, but is not required to show identification. SB 145 requires permittees, operators or vendors to verify prize recipients identification and report names and prize amounts to the Department of Health and Social Services. Number 057 SENATOR ADAMS asked if $1,000 bingo prize winners must provide their names and social security numbers to the permittee. MS. BABCOCK believed the prize recipient only has to sign for the prize. SENATOR ADAMS asked about the penalty provisions contained in SB 145. DENNIS POCHARD, director of the Division of Charitable Gaming, commented that $1,000 bingo prize winners must provide their names and social security numbers because the IRS requires any gaming activity, when a prize of over $600 is awarded, to be reported to the IRS. MS. BABCOCK stated a first violation would carry fine of up to $5,000, a second offense would be a class B misdemeanor which carries a fine of up to $10,000 and a prison term. SENATOR TAYLOR questioned why the current Alaska reporting standard for prize money is $1,000 if the IRS standard is $600. MR. POCHARD replied there are no provisions for reporting prize winners in statute. An operator conducting a gaming activity is required to keep records of winners, but is not required to report those names to the Department of Revenue. The operator is required to keep the records for three years for audit purposes. Number 125 SENATOR TAYLOR asked if the records include the actual pull tabs. MR. POCHARD stated the pull tabs are not kept as records. SENATOR TAYLOR asked if an operator would be required to report a prize award of $650 to the IRS. MR. POCHARD replied affirmatively. SENATOR TAYLOR commented the reporting requirement in SB 145 is not a new burden being placed on operators since they are already reporting larger prizes. He asked if the prize award will be treated as income. MR. POCHARD responded affirmatively. Number 141 SENATOR ADAMS moved the adoption of a proposed amendment allowing municipalities to limit the number of permittees and licensees within their boundaries. SENATOR TAYLOR objected to the motion for the purpose of discussion. SENATOR ADAMS explained the amendment also allows municipalities to limit the number of hours of operation of bingo and pull-tab games conducted each week. SENATOR TAYLOR expressed concern that by allowing municipalities to limit the number of permittees and licensees within their jurisdiction, a franchise on gambling will be created within the city, and businesses would become dependent on who they know on the city council. SENATOR ADAMS responded the current law allows for all or nothing; the amendment would allow the municipalities to decide which non-profits could operate. Number 174 SENATOR GREEN stated she agrees with the amendment in concept, but expressed concern that under such a system, as communities grow in size, they would need to be regulated by an entity that approves the relocation or addition of operators and licensees. SENATOR TAYLOR stated his concern is that creating the power to limit would be creating the power to kill. He added the amendment would allow a municipality to favor some operators, and restrict others, and create a limited entry type of system. He stated he is in favor of the right of municipalities to limit the number of sessions. SENATOR ADAMS commented the amendment provides for accountability of permittees. SENATOR GREEN stated the amendment says a municipality "may" do this by ordinance, it does not say "shall." SENATOR ADAMS noted an ordinance would have to be passed first, so the amendment merely creates an option for the municipality. Number 220 SENATOR TAYLOR stated he would not vote for the amendment unless lines 10-12 were deleted, and maintained his objection. A roll call vote was taken with the following result: Senators Miller, Adams, and Green voted "Yea," and Senator Taylor vote "Nay." The amendment was adopted. SENATOR ADAMS moved and asked unanimous consent that SB 145, as amended, pass out of committee with individual recommendations. There being no objection, the motion carried.