05/05/2005 04:55 PM Senate FIN

                                                                                                                                
     SENATE CS FOR CS FOR HOUSE BILL NO. 61(L&C)                                                                                
     "An Act relating to Calcutta pools and crane classics as                                                                   
     authorized forms of charitable gaming."                                                                                    
                                                                                                                                
                                                                                                                                
This was  the second  hearing for  this bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
4:55:40 PM                                                                                                                    
                                                                                                                                
Senator Dyson  spoke to the concern  he had raised during  the first                                                            
hearing on  this bill regarding  whether  a for-profit entity  might                                                            
make a business  out of helping charities with a Calcutta  endeavor.                                                            
While the answer had been  that the inclusion of the term "operator"                                                            
would deter such  activity, he has learned that the  term "operator"                                                            
is simply defined  as an entity that  is licensed and bonded.  Thus,                                                            
"there is  nothing that  would keep enterprising  individuals"  from                                                            
assisting  in organizing a  sporting event  "and making a deal  with                                                            
some charity to  conduct a Calcutta pool. While this  activity would                                                            
raise  money for the  charity,  for-profit entities  could also  use                                                            
this  tactic  as "an  opportunity"  to  make  money. This  has  been                                                            
experienced in  other states; a Calcutta pool was  bid up and behind                                                            
the scene deals were made  in regards to which team would win. While                                                            
he hoped that  such a scenario would not occur in  Alaska, he warned                                                            
that it could occur in relationship to major sporting events.                                                                   
                                                                                                                                
Senator Stedman  asked whether the intent was to move  the bill from                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Green affirmed.                                                                                                        
                                                                                                                                
Senator  Stedman  voiced being  "uncomfortable  with  enlarging  the                                                            
gambling opportunities  in the state in general". While he would not                                                            
contest  moving the  bill from Committee,  it was  unlikely that  he                                                            
would support it passing from the Senate.                                                                                       
                                                                                                                                
4:58:38 PM                                                                                                                    
                                                                                                                                
Co-Chair Green  understood "the reality"  to be that Calcutta  games                                                            
are  occurring  in  the  State.  While   that  does  not  make  that                                                            
occurrence  okay, this legislation  would allow  places such  as the                                                            
Palmer Golf  Course to increase their  business and raise  money for                                                            
charitable organizations.                                                                                                       
                                                                                                                                
Co-Chair Green  asked whether the bill contains a  mechanism through                                                            
which  to account  for the  money that  would be  raised during  the                                                            
auction associated with the event.                                                                                              
                                                                                                                                
SHALON SZYMANSKI, Staff  to Representative Lesil McGuire, the bill's                                                            
sponsor,  responded  that Sec.  2  page two  lines two  through  ten                                                            
specifies  that the  event organizer  must  file a  report with  the                                                            
Department  of  Revenue  upon  the  conclusion  of  the  event.  The                                                            
Department  of Revenue would  develop the  report form, which  would                                                            
require  an accounting  of the  money raised  as well  as the  money                                                            
provided to the charity.                                                                                                        
                                                                                                                                
5:00:26 PM                                                                                                                    
                                                                                                                                
Co-Chair  Green read the  requirements listed  in Sec. 2. She  asked                                                            
for  clarification  as to  timeframe  in which  the  report must  be                                                            
received by the Department of Revenue.                                                                                          
                                                                                                                                
5:00:32 PM                                                                                                                    
                                                                                                                                
Ms. Szymanski  clarified  that the  report must  be filed after  the                                                            
event.                                                                                                                          
                                                                                                                                
5:00:57 PM                                                                                                                    
                                                                                                                                
Co-Chair Green  asked for an example of what information  would meet                                                            
the "amount and nature  of each expense" requirement as specified in                                                            
Sec. 2 page two, line eight.                                                                                                    
                                                                                                                                
Ms.  Szymanski replied  that  expenses for  such  things as  banners                                                            
advertising the event must be reported.                                                                                         
                                                                                                                                
Co-Chair Green asked for  further information about the auction that                                                            
would occur the  night before the sporting event;  specifically what                                                            
allowable  expenses  the operator  or the  host of  the event  could                                                            
conduct.                                                                                                                        
                                                                                                                                
Ms. Szymanski  stated that  the auction would  usually be held  in a                                                            
banquet  setting the  night  before the  sporting  event. The  teams                                                            
participating in the event  would be auctioned off, and people would                                                            
bid on the  team they believed would  win the tournament.  After the                                                            
conclusion  of the sporting  event, the high  bidder on the  winning                                                            
team  would  receive up  to  50-percent  of the  money  raised.  The                                                            
organization  holding the  event could  specify the  percent of  the                                                            
revenue that  would be contributed  to the  charity; it could  range                                                            
between a minimum of 50-percent and 100-percent of the revenue.                                                                 
                                                                                                                                
Co-Chair Green  asked whether the  amount specified for the  charity                                                            
would be 50-percent of the net or gross revenue.                                                                                
                                                                                                                                
Ms. Szymanski  understood that it  would be 50-percent of  the money                                                            
raised during the auction.                                                                                                      
                                                                                                                                
Co-Chair  Wilken  moved  to  report the  bill  from  committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being no  objection, SCS  CS HB  61 (L&C)  was REPORTED  from                                                            
Committee  with previous  indeterminate fiscal  note #2 dated  April                                                            
14, 2005 from the Department of Revenue.                                                                                        
                                                                                                                                
5:04:07 PM