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5.n FLAAA Gambling Premises Permit>� /K~ SCANDIA Staff Report Date of Meeting: August 21, 2018 To: City Council From: Brenda Eklund, Deputy Clerk Re: Forest Lake Area Athletic Association Application for Lawful Gambling Premises Permit Background: Dana Arntzen, Gambling Manager for the Forest Lake Area Athletic Association, has applied for a Lawful Gambling Premises Permit for the organization to conduct charitable gambling at Brookside Pub, 21050 Ozark Avenue. Issue: Should the Council approve a Lawful Gambling Premises Permit for the Forest Lake Area Athletic Association at Brookside Pub? Proposal Details: Ordinance No. 100, adopted on March 6, 2007, governs lawful gambling within the city. The purpose of the ordinance is to "regulate lawful gambling within the City, to prevent its commercialization, to ensure the integrity of operations, and to provide for the use of the net profits only for lawful purposes." The ordinance establishes the qualifications that must be met by organizations and premises for gambling. FLAAA plans to conduct paper pull -tabs, bar bingo and paddlewheel activities. Only certain organizations are authorized to conduct lawful gambling in Scandia. They must be licensed by the State and also meet at least one of five criteria in the ordinance (Section 7). FLAAA provided documentation that they are licensed by the MN Gambling Board since the early 90's and are currently in good standing. FLAAA is a parent organization for 8 children's sports and one adult league. The organization sponsors athletic programs for children attending schools in the Forest Lake school district (ISD 831). FLAAA provided a breakdown of participant residences, and in 2017 there were 140 Scandia participants in their sports programs. The organization therefore meets criteria A — at least 15 members that are residents of Scandia. Section 8 of the ordinance specifies the qualifications of the personnel/gambling manager of the organization. Review of the application included a background check on the gambling manager and a review of the state licensing information by the Washington County Sheriff's office. The inspection concluded that there were no incidences which would prevent approval of the gambling permit application. Section 14 requires that a licensed organization shall spend 75% of its lawful purpose expenditures derived from gambling conducted at the premises within the city's trade area. The trade area is defined as Scandia, contiguous cities and townships and any portion of the Forest Lake School District. FLAAA provided reports showing expenditures and donations within the area that meets the criteria, with a statement that "they will work with the Scandia area to help support the youth in any way that we can". The organization has a 3 -star rating based on the evaluation by the MN Gambling Control Board, a rating determined on the percentage of annual net receipts spent on lawful purpose expenditures. Once approved, a premises permit runs concurrently with the organization's gambling license on a perpetual basis, unless the permit is suspended or revoked by the Gambling Control Board or is voluntarily terminated by the organization. Fiscal Impact: The $100 permit fee has been paid. Options: 1) Approve Resolution No. 08-21-18-06, approving the premises permit. 2) Amend Resolution No. 08-21-18-06 with conditions. 3) Do not approve. A resolution to deny must be acted on. Recommendation: Action to either approve or deny must be taken by the Council within 60 days after receipt of the application which was made on August 7, 2018. Staff recommends Option 1. APPLICATION FOR LAWFUL GAMBLING PREMISES PERMIT Fee: $100.00 City of Scandia, Minnesota 14727 209th Street North, Scandia, MN 55073 Phone 651/433-2274 Fax 651/433-5112 Web http://www.ci.scandia.mn.us This application form is for use to request City approval of a local permit for lawful gambling required to be registered with the Minnesota Gambling Control Board. In addition to this form applicants shall submit to the City an executed, complete duplicate application, together with all exhibits and documents, as filed with the Gambling Control Board. 1. Name and address of organization: 653()— Wtoff& S¢, A1. 2. Name and address of premises where event will occur: (a copy of the rental or leasing arrangement, if an , including rental to be charged to the ar anization must be attached to this application.) 10 0K.SI�e -Puh -- 2foso 9,e Al. Scait" , OW650733-- 3. Date(s) of gambling occasion: G rit b��qa_mb1U1A_ 01 4. Estimated value of prizes to be awarded: oq o�-�oig 5. Names and addresses of officers and persons accounting for receipts, expenses and profits for the event: Name: bam Rrnlzcl� Street Address: City/ State: rws C Y 11V Name: Street Address: City/ State: Phone: E -Mail: Zip: Phone: E -Mail: Zip: Name: Phone: Street Address: E -Mail: City/ State: Zip: ACKNOWLEDGEMENTS: I hereby acknowledge and certify that the organization and the activity for which this application applies will be conducted in accordance with the all regulations and requirements of Minnesota Statutes and the rules of the Minnesota Gambling Control Board, and the City of Scandia. I further acknowledge that I have receive a copy of Scandia Ordinance No 100 governing lawful gambling, and that I am familiar with and agree to abide by its requirements. 6. Applicant Signptu�e(s) Date: -f-l8-lg Upon receipt of this application you will be notified in writing of the date on which the City Council will consider the permit. The City Council meets on the third Tuesday of each month. Applications must be received not less than 5 days prior to the meeting date. No application will be considered complete until the fee has been paid. Application Fee Received City Council Consideration (Date) Approved Resolution # For City Use Only Denied City of Scandia, Application for Excluded or Exempt Lawful Gambling Permit Page 2, 7/16/2018 rb1D AUG 7 2018 CITY OF SC',;WjIA MINNESOTA LAWFUL GAMBLING LG215 Lease for Lawful Gambling Activity 6/15 Page 1 of 2 LEASE INFORMATION Organization: License/Site Number: Daytime Phone: U `_s' K -e REGR i1 t 1 1 1LE 1 IC SSDC • 6-5-b(1-32/ Address: City: State: Zip: I7 Name of Leased Premisesi Street Address: City: StatSL' w'�'/� i a0►- MN Zip: L' Llaytivri� Phone: b -2 S -/ 1 Name of Legal Owner: $uslnessjStreet Address: !/ nom'• Enrr ray UL- I t� J o S �c- City: I State: Zip: Daytime Phone h �INL �a sr. Ix r,, ��,���� s _ 43,-//t2-- Name 33,-//(Z_Name of Lessor (if same as legal owner, write "SAME"): Address: City: State: Zip Daytime Phone: heck pplicable item: Q blew or amended lease. Effective: date: D Submit changes at least ten days before the effective date of the change. 0 New owner. Effective date: _ Submit new lease within ten days after new lessor assumes ownership. CHECK ALL ACTIVITY THAT WILL BE CONDUCTED (no lease required for raffles) Pull -Tabs (paper) ❑ Electronic Pull -Tabs 0 Pull -Tabs (paper) with dispensing device ❑ Electronic Linked Bingo EZBar Bingo Bingo Electronic games may only be conducted: 1. at a premises licensed for the on -sale of intoxicating liquor Tipboards or the on -sale of 3.2% m t beverages; or Paddlewheel Paddlewheel with table 2. at a premises where bingo isconducted as the primary business and has a seating capacity of at least 100. PULL -TAB, TIPBOARD, AND PADDLEWHEEL RENT (separate rent for booth and bar ops) BOOTH OPERATION: Some or all sales of gambling equipment are conducted by an employee/volunteer of a licensed organization at the leased premises. ALL GAMES, including electronic games: Monthly rent to be paid: %, not to exceed 10% of gross profits for that month. • Total rent paid from all organizations for only booth operations at the leased premises may not exceed $1,750. • The rent cap does not include BAR OPERATION rent for electronic games conducted by the lessor. BAR OPERATION: All sales of gambling equipment conducted by the lessor or lessor's employee. ELECTRONIC GAMES: Monthly rent to be paid :�, not to exceed 15% of the gross profits for that month from electronic pull -tab games and electronic linked bingo games. ALL OTHER GAMES: Monthly rent to be paid: _7'e,—%, not to exceed 200/b of gross profits from all other forms of lawful gambling. • If any booth sales conducted by a licensed organization at the premises, rent may not exceed 10% of gross profits for that month and is subject to booth operation $1,750 cap. BINGO RENT (for leased premises where bingo is the primary business conducted, such as bingo hall) Bingo rent is limited to on of the following: • Rent to be paid: � %, not to exceed 10% of the monthly gross profit from all lawful gambling activities held during bingo occasions, excludin bar bingo. -OR- • Rate to be paid: $ per square foot, not to exceed 110% of a comparable cost per square foot for leased space, as approved by the dire t r of the Gambling Control Board. The lessor must attach documentation, verified by the organization, to confirm the comparable rate and all applicable costs to be paid by the organization to the lessor. => Rent may not be paid for bar bingo. Bar bingo does not include bingo games linked to other permitted premises. LEASE TERMINATION CLAUSE (must be completed) The lease may be terminated by either party with a written � day notice. Other terms: LG215 Lease for Lawful Gambling Activity Lease Term: The term of this agreement will be concurrent with the premises permit issued by the Gambling Control Board (Board). Management: The owner of the premises or the lessor will not manage the conduct of lawful gambling at the premises. The organization may not conduct any activity on behalf of the lessor on the leased premises. Participation as Players Prohibited: The lessor will not par- ticipate directly or indirectly as a player in any lawful gambling conducted on the premises. The lessor's immediate family and any agents or gambling employees of the lessor will not partici- pate as players in the conduct of lawful gambling on the premis- es, except as authorized by Minnesota Statutes, Section 349.181. Illegal Gambling: The lessor is aware of the prohibition against illegal gambling in Minnesota Statutes 609.75, and the penalties for illegal gambling violations in Minnesota Rules 7865.0220, Subpart 3. In addition, the Board may authorize the organization to withhold rent for a period of up to 90 days if the Board determines that illegal gambling occurred on the premises or that the lessor or its employees participated in the illegal gambling or knew of the gambling and did not take prompt action to stop the gambling. Continued tenancy of the organiza- tion is authorized without payment of rent during the time period determined by the Board for violations of this provision, as authorized by Minnesota Statutes, Section 349.18, Subd. 1(a). To the best of the lessor's knowledge, the lessor affirms that any and all games or devices located on the premises are not being used, and are not capable of being used, in a manner that violates the prohibitions against illegal gambling in Minnesota Statutes, Section 609.75. Notwithstanding Minnesota Rules 7865.0220, Subpart 3, an organization must continue making rent payments under the terms of this lease, if the organization or its agents are found to be solely responsible for any illegal gambling, conducted at this site, that is prohibited by Minnesota Rules 7861.0260, Subpart 1, item H, or Minnesota Statutes, Section 609.75, unless the organization's agents responsible for the illegal gambling activity are also agents or employees of the lessor. The lessor must not modify or terminate the lease in whole or in part because the organization reported, to a state or local law enforcement authority or to the Board, the conduct of illegal gambling activity at this site in which the organization did not participate. 6/15 Page 2 of 2 Other Prohibitions: The lessor will not impose restrictions on the organization with respect to providers (distributor or linked bingo game provider) of gambling -related equipment and ser- vices or in the use of net profits for lawful purposes. The lessor, the lessor's immediate family, any person residing in the same residence as the lessor, and any agents or employees of the lessor will not require the organization to perform any action that would violate statute or rule. The lessor must not modify or terminate this lease in whole or in part due to the lessor's violation of this provision. If there is a dispute as to whether a violation occurred, the lease will remain in effect pend- ing a final determination by the Compliance Review Group (CRG) of the Board. The lessor agrees to arbitration when a violation of this provision is alleged. The arbitrator shall be the CRG. Access to Permitted Premises: Consent is given to the Board and its agents, the commissioners of revenue and public safety and their agents, and law enforcement personnel to enter and inspect the permitted premises at any reasonable time during the business hours of the lessor. The organization has access to the premises during any time reasonable and when necessary for the conduct of lawful gambling. Lessor Records: The lessor must maintain a record of all money received from the organization, and make the record available to the Board and its agents, and the commissioners of revenue and public safety and their agents upon demand. The record must be maintained for 3-1/2 years. Rent All -Inclusive: Amounts paid as rent by the organization to the lessor are all-inclusive. No other services or expenses provided or contracted by the lessor may be paid by the organi- zation, including but not limited to: - trash removal - electricity, heat - snow removal - storage - janitorial and cleaning services - other utilities or services - lawn services - security, security monitoring - cost of any communication network or service required to conduct electronic pull -tabs games or electronic bingo - in the case of bar operations, cash shortages. Any other expenditures made by an organization that is related to a leased premises must be approved by the director of the Board. Rent payments may not be made to an individual. ACKNOWLEDGMENT OF LEASE TERMS I affirm that this lease is the total and only agreement between the lessor and the organization, and that all obligations and agreements are contained in or attached to this lease and are subject to the approval of the director of the Gambling Control Board Other terms of the lease: Signature ❑ `s r: r Date: Sig ure Or# niz tion Official (Lessee): Date: Print Na a and Tit of Le or: nt Name tr a of a ee: Questions? Contact the Licensing Section, Gambling Control Board, at Mail or fax lease to: 651-539-1900. This publication will be made available in alternative format (i.e. Minnesota Gambling Control Board large print, braille) upon request. Data privacy notice: The information requested 1711 W. County Road B, Suite 300 South on this form and any attachments will become public information when received by Roseville, MN 55113 the Board, and will be used to determine your compliance with Minnesota statutes Fax: 651-639-4032 and rules governing lawful gambling activities. Business Record Details b 1 Minnesota Business Name THE FOREST LAKE ATHLETIC ASSOCIATION Business Type MN Statute Nonprofit Corporation (Domestic) 317A File Number Home Jurisdiction 5551 -NP Minnesota Filing Date Status 04/27/1950 Active / In Good Standing Renewal Due Date Registered Office Address 12/31/2019 5530 206th Street N Forest Lake, MN 55025 USA Number of Shares Registered Agent(s) NONE (Optional) None provided President Allan Hauge 5530 206th Street Forest Lake, MN 55025 USA Filing History Filing History Select the Item(s) you would like to order. Order selected Copies 0 Filing Date Filing 0 04/27/1950 Original Filing - Nonprofit Corporation (Domestic) 04/27/1950 Nonprofit Corporation (Domestic) Business Name (Business Name: The Forest Lake Athletic Effective Date ® 2018 Office of the Minnesota Secretary of State - Terms & Conditions Association) 0 05/16/1990 Registered Office and/or Agent - Nonprofit Corporation (Domestic) 0 11/26/1996 Nonprofit Corporation (Domestic) Business Name (Business Name: THE FOREST LAKE ATHLETIC ASSOCIATION) 11/26/1996 Registered Office and/or Agent - Nonprofit Corporation (Domestic) 11/26/1996 Nonprofit Corporation (Domestic) Restated Articles 0 09/28/1998 Registered Office and/or Agent - Nonprofit Corporation (Domestic) O 06/02/2000 Registered Office and/or Agent - Nonprofit Corporation (Domestic) 0 09/26/2009 Registered Office and/or Agent - Nonprofit Corporation (Domestic) 0 4/22/2014 Involuntary Dissolution - Nonprofit Corporation (Domestic) 0 3/26/2015 Annual Reinstatement - Nonprofit Corporation (Domestic) ® 2018 Office of the Minnesota Secretary of State - Terms & Conditions Minnesota Gambling Control Board has issued Lawful Gambling License 04354 to Forest Lake Athletic Assoc Allan D Hauge Forest Lake Athletic Assoc Box 21 Forest Lake, MN 55025 Effective Date: Jul 01 2010 Licensing Supervisor Issued by: Minnesota Gambling Control Board Suite 300 South 1711 W. 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V} C V> C Q c v c E m n4 00 N v (0 0 m 0 c u m E z 2 an C ai l6 Q N � o a N Lr; a Q c ° m m N Q Q tkom a o a) 14 a L Q Q1 .moi N in a a C v o v ar u 00 0 a w o C U c V C u N v '^ W LA ° o m c �• � c W �LL a M c t m •J m Y m t XFo w U O F- .-4 N M Rt 4 u O im im a Q c v c E m n4 00 N v (0 0 m 0 c u m E z 2 an C ai l6 Q N � o a N Lr; a Q c ° m m N Q Q tkom a o a) 14 a L Q Q1 .moi N in a a C v o v ar u 00 0 a w o C U c V C u N v '^ W LA ° o m c �• � c W �LL a M c t m •J m Y m t XFo w U O F- .-4 N M Rt b.eklund@ci.scandia.mn.us From: Gambling Manager <gamblingmanager@flaaa.org> Sent: Thursday, August 16, 2018 2:38 PM To: b.eklund@ci.scandia.mn.us Cc: n.soltis@ci.scandia.mn.us Subject: Re: FW: Application for Gambling Premises Permit Attachments: 2017 Residence of FLAAA Sports Participants 1.pdf; 2018 Residence of FLAAA Sports Participants.pdf; LG100C Jan. -June 2018.pdf; 20180815145842539.pdf Good afternoon, Thank you for the email. I have 4 attachments for you, my LG100C's for January 2018 -June 2018, 2017 Residence of FLAAA Sports Participants, 2018 Residence of FLAAA Sport Participants, and our star rating from MNGCB (39.86%). When reading the Section 14. Designated Trade Area. I believe that we do meet the qualifications, if your cities trade area is Hugo, Scandia, Marine on the St. Croix, Chisago, Forest Lake and Lindstrom. As you will see in my LG100C's FLAAA gambling has donated monies to Forest Lake Football Association (334 children in trade areas), Forest Lake Baseball Association (185 children in trade areas), Forest Lake Basketball Association (110 children in trade areas), Forest Lake Fastpitch Association (165 children in trade areas), Forest Lake Hockey Association (314 children in trade areas), Forest Lake Lacrosse Association (123 children in trade areas), Girls T-Ball/Modified Pitch (200 children in trade areas) and Lakes Volleyball/Jr. Rangers volleyball program (128 children in trade areas). From June 2017 through June 2018 FLAAA Gambling has donated monies to all of the sports listed, Football $30,702.40, Baseball $850.00, Basketball $500.00, Fastpitch $695.00, Hockey $500.00, Lacrosse $9,675.00, Modified Pitch $720.00, and Volleyball $1980.00. Forest Lake Area Athletic Association has a mission statement, "Working together to support and participate in the positive development of youth". FLAAA is a parent company for 8 children's sports and an adult league. We run and operate Fenway Fields located in Forest Lake and the concessions stand inside of Fenway Fields. Our typical donations go to the children in the sports that we operate. We also have donations that we give to the ISD 831 School district for the kids ( June 2017 -June 2018 $3,860.00) and every year we hand out 10- $500.00 scholarships to seniors at Forest Lake High School. Occasionally we receive requests from outside groups that support children and typically we donate to those groups or causes. We are planning on working with the Scandia area to help support the youth in any way that we can. We have had a charitable gambling license since the early 90's and continue to maintain excellent standing with the Minnesota Gambling Control Board. We are hoping to expand into Scandia and have a great working relationship with the community. Please let me know if there is anything else that you need from myself or FLAAA.