PETITION OF:

AN ACT RELATIVE TO THE CONDUCT OF POKER GAMES AND SPONSORSHIP BY CERTAIN CHARITABLE ORGANIZATIONS.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1.

Chapter 10 of the general laws, as appearing in the 2006 official edition, is hereby amended by inserting after Section 35CC, the following new Section:-

Section 35DD, Charitable Organizations Trust Fund. There shall be an expendable trust, to be known as the Charitable Organizations Trust Fund, the purpose of which is to support any educational, charitable, religious, fraternal or civic purposes or for veterans’ benefits in the commonwealth. The fund shall consist of revenues received by the commonwealth under the provisions of section 37A of this chapter, from public and private sources as gifts, grants, and donations to further the purposes of the fund. Revenues credited to the fund under this section shall remain in the fund, not subject to appropriation, for application to those purposes. The state treasurer shall not deposit the revenues in, or transfer the revenues to, the General Fund or any other fund other than the Charitable Organizations Trust Fund. The state treasurer shall deposit monies in the fund in accordance with subsection (l) of section 37A of this chapter in such manner as will secure the highest interest rate available consistent with safety of the fund and with the requirement that all amounts on deposit be available for immediate withdrawal at any time. Revenues received for the Charitable Organizations Trust Fund shall be directly paid through the established expendable trust to qualifying charitable organizations selected by the charitable division of the state lottery commission; provided such organization shall have been organized and actively functioning as a nonprofit organization in the commonwealth for a period of not less than two years before it may apply and provided further, that all approved organizations receive an equitable sum in any given distribution period.

SECTION 2.

Chapter 10 of the general laws, is hereby further amended by inserting after Section 37, the following new Section:-

Section 37A, Poker Games, Licensing, Sponsorship of Certain Charitable Organizations.

                    State law prohibits commercially operated lotteries, banked or percentage games, and gambling machines, and strictly regulates wagering on horse and dog racing.  To the extent that state law categorically prohibits certain forms of gambling and prohibits gambling devices, nothing herein shall be construed, in any manner, to reflect a legislative intent to relax those prohibitions.  It is not the purpose of this chapter to expand opportunities for regulated wagering on horse or dog racing in this state, or to create any right to operate a gambling enterprise in this state.  It is the purpose of this section to regulate businesses in the lawful operation and conduct of poker games in suitable locations while ensuring recordkeeping and fundraising for charitable organizations.

As used in this section, the following words shall, unless the context otherwise requires, have the following meanings:-

"Key employee" means any natural person employed in the operation of a poker game licensee in a supervisory capacity or empowered to make discretionary decisions that regulate poker game operations, including, without limitation, pit bosses, shift bosses,

credit executives, cashier operations supervisors, game operation managers and assistant managers, managers or supervisors of security employees, or any other natural person designated as a key employee by the commission for reasons consistent with the policies of this chapter.

"Key employee certificate" means a state certificate of clearance authorizing the

holder to be associated with a poker game licensee as a key employee.

“Licensee” means a person, firm or corporation authorized by the state lottery commission to engage in the business of promoting, advertising, operating, holding, dealing, and conducting for the play of poker games, in connection with which prizes are offered to be won by chance and skill.

“Poker” means a card game of chance and skill that does not include video, electronic or internet games.

“Prize” means money or any right, privilege or thing of any property value distributed by way of winning a poker hand, game, competition, tournament or jackpot.

                    (a) Notwithstanding any special or general law to the contrary, the state lottery commission may issue a limited number of licenses in each of the five regions of the state to promote, operate, hold and conduct the game of poker under this section exclusively; provided that such conduct is open to the general public on commercial premises leased or owned by said licensee for which a city or town has voted to allow granting of a permit for the promotion, advertisement, operation, holding and conducting of said poker game therein; provided that the application for such permit is in the case of a city, other than the city of Boston, approved by the majority of the city council and approved by the mayor, in a town by the board of selectmen, and in the city of Boston, approved by the licensing board for said city; and provided further, that a percentage of funds derived therefrom shall be deposited consistent with this section into the state treasury and Charitable Organization Trust Fund established in section 35DD of this chapter.  The location of lawful poker gaming premises, the hours of operation of those premises, the amount and type of security required, adequate law enforcement capability, the number of tables permitted in those premises, and wagering limits in permissible games conducted in those premises are proper subjects for regulation by local governmental bodies.  However, consideration of those same subjects by the commission, with direction from the commissioner of public safety as appropriate, is warranted when local governmental regulation respecting those subjects is inadequate or the regulation fails to safeguard the legitimate interests of residents in other governmental jurisdictions.

(b) Nothing in this section shall prohibit an organization, society, church or club, which conducts a raffle or bazaar in accordance with the provisions of section 7A of chapter 271, from promoting, operating and conducting a poker game; provided the net profits of any poker game to be conducted under said section shall be the exclusive property of the organization sponsoring said game; and provided further, that nothing in section 17 of said chapter 271 or any special or general law to the contrary shall prohibit a licensee under this section from becoming the designated poker game operator, dealer, custodian, or depositary for hire, commission or compensation.

(c) A license may be issued only to a firm or corporation duly incorporated under the laws of the commonwealth, conducting business exclusively in the commonwealth, who has a resident agent registered with the secretary of state for the commonwealth that serves as an officer; provided that such applicant provides satisfactory proof of permit to engage in said conduct by a city or town and provided further; that per the discretion of the director after a criminal history background investigation no unsuitable person or key employee be permitted to associate with poker game business activities. A license holder may transfer their license to another so long as the assignment is to an officer of a firm or corporation incorporated under the laws of the commonwealth who, in the director’s discretion, substantially satisfies the license qualifications of this section.

(d) The fee for any such license, or permit under this section shall be determined annually by the commissioner of administration under the provision of section 3B of chapter 7, but shall not exceed two hundred and fifty dollars. The proceeds of said license fees and any fine collected pursuant to this section shall be paid into the treasury of the commonwealth and shall be used by the commission to defray the cost of administering this section, subject to appropriation.

(e) A licensee may conduct tournaments, or so called winner-take-all games, on any one day on which the licensee is authorized to conduct poker games, which may be multiple games or a series of games, or jackpot games where poker game play may occur on multiple days.

(f) Any such licensee shall not be subject to prosecution for setting up, promoting, advertising, operating, holding or conducting a poker game, or any other crime incidental thereto, or for selling game admission tickets to any said poker game, the price of which shall be printed on each ticket; provided that no poker game shall be advertised or publicized by sign or billboard beyond the city or town limits covered by each licensee and provided further, that no person under 21 years of age shall be permitted in that portion of any building or premises of the licensee during such time as any game is being conducted.

(g) The commission shall regulate how licensees determine the price of game admission, shall retain five percent of gross revenue from poker game admission ticket sales and shall allow a licensee to print or produce game admission tickets. Each licensee shall be entitled to retain, a so called entry fee, covering operating expenses from poker game conduct, of not less than fifteen per cent of the value of game admission tickets sold by it, and shall be solely responsible for paying poker game prizes won. Prizes, commonly referred to as the buy in, shall not be less than 65 percent of funds collected from game admission tickets sold on a poker game. Profits of other poker game related activities conducted in accordance with the laws of this commonwealth shall be the property of the licensee conducting said game, unless provided otherwise in this section.

                    (h) Responsibilities of the commission include, without limitation, all of the following; assuring that license approvals, renewals and key employee certificates are not issued to, or held by, unqualified or disqualified persons, or by persons whose operations are conducted in a manner that is inimical to the public health, safety. Such license may be revoked at the discretion of the commission after notice and a hearing in compliance with chapter 30A and shall be suspended or revoked upon written request to the director by the city or town approving authority as set forth above in subsection (a).  Any licensee or former licensee aggrieved by the action of such authority revoking such permit may appeal to the district court having jurisdiction in the city or town where the permit was issued; provided that such appeal shall be filed in such court within twenty days following receipt of notification by said authority. The court shall hear all pertinent evidence and determine the facts and upon the facts so determined annul such action or make such decision as equity may require. The foregoing remedy shall be exclusive.  However, any license issued, or other approval granted pursuant to this section, is declared to be a revocable privilege, and no holder acquires any vested right therein or thereunder.

(i) A licensee shall be limited to the playing of any poker game on any days as the city or town may require. If a licensee fails to exercise exclusive control and management of said game, or fails to have one of its key employees in good standing in full control and management of the game at all times during its operation, it shall be punished by a fine of not less than $3,000.

(j) Accurate records and books shall be kept by each licensee on forms provided by the commission showing the total amount of all monies deposited by people who played, attended, participated in said games, the expenses incurred and the name and address of each organization receiving revenue and the appropriate chapter 62C information of any person receiving a prize valued at six hundred dollars or more. A separate checking account shall be kept of receipts and expenditures of poker card games and money for expenses shall be withdrawn only by checks having preprinted consecutive numbers and made payable to a specific person or corporation and at no time shall a check be made payable to cash. Proceeds from any poker game shall be kept in a separate bank account and the licensee shall monthly file an end of month return with the commission on a form prepared by it and shall pay therewith a tax of five percent of the gross receipts derived from any such game. Further, an annual report of the preceding year shall be filed with the director in January in such form as the director may prescribe. The director, the approving authority of the city or town wherein said game is conducted, or their duly authorized agents or representatives, shall at all times have access to said records and books of any licensee for the purpose of examining and checking the same.

(k) The director shall file an annual report in January of the charitable, religious or educational disbursements of the preceding year. Such annual report shall be a public record. All monies expended for said educational, charitable, religious, fraternal or civic purposes or for veterans’ benefits shall be duly and accurately recorded as to specific amounts expended and the purposes for which expended. A report of such records and any information the director may deem relevant shall be filed with the clerk of the house of representatives and the clerk of the senate on or before December 31 of each year.

(l) All sums received by said commission from the tax imposed by this section as taxes, interest thereon, fees, penalties, forfeitures, costs of suits or fines, less all amounts refunded thereon, together with any interest or costs paid on account of such refunds, shall be paid into the treasury of the commonwealth and shall be credited as follows:- (1) Three fifths of all such sums received shall be credited to the commission for the payment of costs incurred by the commission in the operation and administration of the activities authorized by this section, including the expenses of the commission and the costs resulting from any contract or contracts entered into for promotional, advertising or operational service, subject to appropriation; and (2) the balance of said revenue, as determined by the comptroller on June 1 and December 1 of each year, shall be credited to the Charitable Organizations Trust Fund established under the provisions of section 35DD and distributed in accordance with its provisions.

                    (m) Activities authorized by this section shall be subject to all provisions of the state lottery law not inconsistent herewith.   The commission may make such other rules and regulations as it may deem necessary to carry out the provisions of this section and the director, is empowered to perform criminal background checks, financial audits, and other investigatory services as needed to assist the commission and may assess and collect reasonable fees and deposits as necessary to defray the costs of providing this regulation and oversight Whoever violates any regulation promulgated by the commission under this section may be punished by a fine not less than $3,000. 



 SECTION 3.

Section 40 of said chapter 10 of the General Laws, is hereby further amended, in line one, by adding after the word “sections” the following words:- "thirty-seven A,”

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SECTION 4.

Section 7A of chapter 271 of the General Laws, as appearing in the 2004 Official Edition, is hereby amended, in line (36), by adding at the end of the third sentence of the third full paragraph of said section the following:- "except that the sponsoring organization shall retain, at a reasonable fee, a licensed entity in accordance with section 37A of chapter 10 to assist in the operation and conduct of any poker game, including providing paid dealers and game supervisors to insure that the rules of the game are properly administered and complied with and records regarding a poker game prize winner are uniformly kept."

SECTION 5.

                    Section 17 of said chapter 271 of the General Laws, as appearing in the 2004 Official Edition, is hereby amended, by adding at the end of the first full paragraph of said section the following:- "All licensed poker game establishments in this state must remain open to the general public and the access of the general public to said licensed activities must not be restricted in any manner, however, subject to state and federal prohibitions against discrimination, nothing herein shall be construed to preclude exclusion of unsuitable persons from licensed poker game establishments in the exercise of reasonable business judgment  Nothing in this section shall prohibit a person from advertising for, selling to, participating at, or entering into contact with a poker game business duly licensed in accordance with section 37A of chapter 10 of the general laws.”

SECTION 6.

                    Chapter 62C of the general laws, as appearing in the 2004 official edition, is hereby amended by adding the following new Section:-

Section 18A.  Every licensee and organization sponsoring a poker game under section thirty-seven A of chapter ten shall within thirty days after such game is held file an information return with the commissioner containing the names and addresses of all persons receiving prizes over six hundred dollars in such game and the amount of every such prize.

SECTION 7.

Said chapter 62C is hereby further amended in section 21 by striking the words “and section eighteen ” in line _ of subsection (b)(3) after the word “sixteen” and adding the following:- “, section eighteen and section eighteen A”

SECTION 8.

Upon the effective date of this act, for a period of three months, the director shall issue up to five (5) licenses on a first come first serve basis for a fee of two hundred and fifty dollars to any person with proof of at least two years experience in the gaming equipment rental service and assistance of charitable organizations sponsoring poker game tournament events within the commonwealth; provided a criminal background investigation is satisfactory to the director and a permit authorizing poker game conduct by local authorities is submitted.