CR 05-130 VFW gambling
September 12, 2005
Council Report 2005-130
CHARITABLE GAMBLING PREMISES PERMIT APPLICATION FOR
THE HOPKINS VFW POST 425
Staff recommends approval of the following motion: Move that the Hopkins City Council
adopt Resolutions 2005-087, approving the charitable gambling premises permit for the
Hopkins VFW Post 425, 100 Shady Oak Road.
Adoption of this resolution will allow the Hopkins VFW to continue to run the existing
charitable gambling activities at the VFW hall.
Overview
. The VFW has requested a renewal of their gambling license and premises permit.
They conduct charitable gambling at the VFW hall only.
Primary Issues to Consider
. Does this organization meet the criteria of the City's gambling policy?
Yes
. Has the organization conducted its past gambling operations in accordance with
state and local laws?
Yes
Supporting Documents
. Resolution 2005-087
. Legislative Policy 4-A, Lawful Gambling
. Financial Statement and Independent Auditor's Report, Years ending June 30,
2004 and 2003
. List of donations made by the VFW
. Gambling License Application available in the City Clerk's office
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Terry Obermaier, City Clerk
Council Report 2005-130
Page 2
Alternatives
1. Approve Resolution 2005-, allowing the Hopkins VFW to continue the present
gambling activities at the present location.
2. Do not approve the resolutions with the result that the Hopkins VFW will no longer
have gambling in the City of Hopkins.
3. Continue the item for more information.
Staff recommends alternative one.
CITY OF HOPKINS
HENNEPIN COUNTY, MINNESOTA
RESOLUTION 2005-087
RESOLUTION APPROVING A GAMBLING PREMISES
LICENSE FOR THE HOPKINS VFW, POST 425, AT
100 SHADY OAK ROAD, HOPKINS
WHEREAS, the Hopkins VFW has been an integral part of the Hopkins
Community, and
WHEREAS, the Hopkins VFW has applied for a gambling license to
conduct lawful gambling in 2006 and 2007, and
WHEREAS, the Hopkins VFW has conducted gambling activities in
accordance with state law and Hopkins City Policy,
NOW, THEREFORE, be it hereby resolved that the City Council of the
City of Hopkins, Minnesota, approves the Hopkins VFW's Premises Permit
Renewal application for The Hopkins VFW Hall, 100 Shady Oak Road,
Hopkins.
Adopted by the City Council of the City of Hopkins, Minnesota, this 20th day
of September, 2005.
Eugene J. Maxwell, Mayor
ATTEST:
Terry Obermaier, City Clerk
POLICY 4-A
LAWFUL GAMBLING
1. PURPOSE
1:01 The purpose of this policy is to establish rules and procedures for lawful gambling in the City of
Hopkins.
2. REGULATIONS
2.01 Except as otherwise enumerated herein, the provisions of Minnesota Statute Chapter 349 relating to
the definition of terms, licensing and restrictions of gambling are adopted and made a part of the
statement of policy promulgated by the City of Hopkins as if set out in full
2.02 An applicant for a license shall be a registered Minnesota nonprofit corporation or an organization
which is designated as exempt from the payment of income taxes by the Internal Revenue Code and
whose principal location or office is within the City of Hopkins.
2.03 The organization defined in Section 2.02 must be engaged in its activities for the benefit of the
community within the City of Hopkins for at least five years on a perpetual, continuous,
uninterrupted basis and have at least 30 active voting members.
2.04 Gambling allowed by the city shall. be carried on only within premises owned, occupied or leased
by the organization except such activities permissible under M.S. 349.166.
2.05 No application for a premises permit will be approved for any organization to conduct gambling on
any premises other than the premises of an on-sale liquor licensee or the premises of a fraternal,
veterans or other non-profit organization. In order for a fraternal, veterans, or other non-profit
organization to conduct gambling on their premises, such premises must have been continuously
owned and occupied for a period of at least five years. No application for premises permit shall be
approved for any organization for a site established for the primary purpose of conducting
gambling. This section shall not apply to any organization which is exempt from the requirement
for a gambling license according to M.S. 349.166.
2.06 A Class A license will only be approved for an organization that is licensed pursuant to Minnesota
Statute, section 349.16, and that conducts gambling on premises that it owns and operates.
2.07 More than one organization, as defined in Section 2.02, may conduct gambling within a single
owned, occupied or leased premise. More than one organization may jointly conduct a lawful
gambling game at one location. However, two or more organizations shall not separately conduct
the same game at the same time at one location.
2.08 The operation of gambling devices and the conduct of bingo and raffles licensed or approved
pursuant to the authority granted to the City of Hopkins shall be carried on under the supervision of
a gambling manager designated by the organization. The gambling manager shall be responsible
for the operation of the gambling activity and the receipts and profits generated from the operation.
2.09 The gambling manager shall be an active member of the organization issued the license and shall
qualify under state law.
2.10 Organizations seeking approval for a premises permit, that are not currently conducting gambling in
the City, must provide the City, in addition to the application forms, a copy of the minutes of a
general membership meeting, where a quorum was present, wherein the organization approved a
motion authorizing the gambling activities.
2.11 Participants in raffles, paddlewheels, pull tabs and tip boards shall be restricted to individuals who
have attained the legal drinking age. This restriction only applies to premises where liquor, wine,
beer or 3.2 beer is served. Where intoxicating beverages are not served the age shall be eighteen.
2.12 Organizations wishing to renew a gambling license must provide the City with a financial audit of
its lawful gambling activities and funds for the previous two years. The audit(s) must be performed
by an independent accountant licensed by the state of Minnesota.
2.13 In addition, such organizations must provide the City with information on all expenditures of lawful
gambling funds during the previous two years. Such information must include at a minimum the
name of the recipient, the amount of the expenditure or contribution, and a brief description of how
the expenditure or contribution meets the definition of "lawful purposes" as defined in M.S. 349.12.
The City reserves the right to require additional documentation from licensed organizations, or
organizations seeking licenses, as it deems necessary.
2.14 A fee of$lOO.OO shall be charged to all organizations submitting a Premises Permit Application or
Applications for approval by the City.
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Lawful Gambling Fund of
GEORGE R. WOLFF VFW POST 425
(License #A-OO 185)
Statement of Assets, Liabilities and Fund Balance
Regulatory Basis
For the Years Ended June 30. 2004 and 2003
ASSETS
2004 2003
Cash
Gambling Bank Account $ 135,507 $ 34,150
Savings Account-Interest Bearing 24,254
Starting Game Banks 8,056 8,179
Total Cash 143,563 66,583
Fund Loss Receivable 6,723 6,723
Inventories
Games 3,542 3,090
Prizes
Total Assets $ 153,828 $ 76,396
Accounts Payable
State Taxes Payable
Due to Game Vendors
Unearned Revenue
Unpaid Prizes
Total Liabilities
$ 16,349
2,400
1,860
845
21,454
$ 16,781
3,140
386
1,870
22,177
Fund Balance
Profit Carryover
132,374
153,828
54,219
Total Liabilities & Profit Carryover
$ 76,396
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see accompanying Notes and Auditor's Report
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Lawful Gambling Fund of
GEORGE R WOLFF VFW POST 425
(License #A-OO 185)
Statement of Revenues, Expenses & Changes in Profit Carryover
Regulatory Basis
For the Years Ended June 30,2004 and 2003
2004 2003
Amount % Amount %
REVENUES
PuJltab receipts $ 4,040,766 $ 3,982,472
Paddlewheel Receipts 19,500 16,500
Bingo Receipts 716,625 872,028
Interest Income 20 70
4.776.911 4.871.070
COST OF REVENUES
Pulltab Prizes 3,333,919 3,310,640
Paddlewheel Prizes 12,470 8,250
Bingo Prizes 645.600 771.017
3.991.989 4.089.907
GROSS PROFIT 784,922 100.0% 781,163 100.0%
ALLOWABLE EXPENSES 330.363 42.1 378.680 48.4
REVENUES IN EXCESS OF
ALLOWABLE EXPENSES 454,559 57.9 402.483 51.6
LAWFUL PURPOSE EXPENDITURES
State Combined Receipts Tax 170,458 21.7 167,410 21.4
State 8.5% Receipts Tax 6,635 .9 9,287 1.2
State Board Fee 4,777 .6
State Ideal Gambling Tax $ 88,271 $ 90,654
Less Refund 18.300 69,971 8.9 17.676 72,978 9.3
Federal Gambling Taxes 10,112 1.3 10,158 1.3
Audit Fee 3,000 .4 4,400 .6
Utilities 30,877 3.9
Real Estate Taxes 23,703 3.0 21,858 2.8
Program Expenditures 55.790 -1J. 123.901 15.9
375.323 47.8 409.992 52.5
REVENUES IN EXCESS OF EXPENSES 79,236 10.1% (7,509) ....Jjl)%
Board Approved Adjustments 16,296
Board Approved Expenditures (1,081) (28,193)
Profit Carry-Over-Beginning of Year 54.219 73.625
PROFIT CARRY-OVER END OF YEAR $ 132 374 $ 54219
See accompanying Notes and Auditor's Report
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Lawful Gambling Fund of
GEORGE R. WOLFF VFW POST 425
(License #A-00185)
Analysis of Maximum Allowable Expenses
As a Percentage of Gross Profit
Regulatory Basis
For the Years Ended June 30, 2004 and 2003
2004 2003
Amount % Amount %
REVENUES $ 4,776,891 $ 4,871 ,000
COST OF REVENUES 3,991,989 4,089,907
784,902 781,093
INTEREST INCOME 20 70
GROSS PROFIT 784,922 100.0% 781,163 100.0%
ALLOWABLE EXPENSES
Cost of Games Used 88,580 11.3 92,492 11.8
Compensation &
Payroll Taxes 173,645 22.1 188,744 24.1
Legal & Accounting 17,062 2.2 15,500 2.0
Advertising 2,645 .3 1,700 .2
Office Supplies, Bank Charges, Misc. 7,717 1.0 15,407 2.0
Utilities 7,603 1.0
Licenses & Bond 600 .1 300
Insurance 8,333 1.1 6,688 .9
Cash Shortage (1,460) (.2) 4,843 .6
Equipment and Maintenance 33,241 4.2 45,403 5.8
Total Allowable Expenses 330,363 42.1% 378,680 48.4%
Maximum Allowable Expenses
by Minnesota Statute 442,349 447,791
Excess of Maximum Allowable
Expenses-Current Year $ (111,986) $ (69,111)
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Lawful Gambling Fund of
GEORGE R. WOLFF VFW POST 425
(License #A-OO 185)
Reconciliation of Profit Carry-Over
Regulatory Basis
For the Years Ended June 30, 2004 and 2003
ADDITIONS
Cash in Savings Account
Cash in Gambling Bank Account
Ending Inventories - Games
Fund Loss Receivable
Taxes Payable
Due to Game Vendors
Unpaid Prizes
Unearned Revenue
Total Additions
2004 2003
$ 70
$ 101,257
452 226
1,500
432 344
740 5,197
1,025
2,699
104,006 10,036
SUBTRACTIONS:
Cash in Gambling Bank Account
Cash in Gambling Savings Account
Starting Game Banks
Unpaid Prizes
Ending Inventories - Prizes
Unearned Revenue
Total Subtractions
24,254
123
10,793
5,332
970
450
1,474
25,851
79,236
(1,081)
54,219
132,374
132,375
$ (1 )
17,545
Profit Carry-over
Current Year
Board Approved Adjustments
Board Approved Expenditures
Profit Carry-over
Beginning of Year
Profit Carry-over From
Financial Statements
Profit Carry-over from
Department of Revenue
Variance from Balance
(7,509)
16,296
(28,193)
73,625
54,219
54,218
$ 1
Analysis of Variance
Cash Over/Short
Advertising
$
$
(1 )
(1 )
$ 146
(145)
$ 1
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') Lawful Gambling Fund of
,
! GEORGE R. WOLFF VFW POST 425
(License #A-00185)
;1 Lawful Purpose Program Expenditures - Regulatory Basis
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J For the Years Ended June 30, 2004 and 2003
TAXES 2004 2003
I Federal Gambling Taxes $10,112 $10,158
State 8.5% Receipts Tax 6,635 9,287
State Board Fee 4,777
I State Ideal Gambling Taxes $ 88,271 $ 90,654
Less Refund 18,300 69,971 17,676 72,978
Combined Receipts Taxes 170,458 167,410
I Real Estate Taxes 23,703 21,858
~, Subtotal 285,656 281,691
Audit Fees 3,000 4,400
;'1 Utilities 30,877 23,357
;j GRANTS
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Families in Need 8,036 15,015
''.'1 Acts of St. Paul 2,000
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,.'\ A Certain Tee 5,746 6,281
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Humane Society 3,000
:J City of Hopkins 7,359 7,417
Youth Activities 9,553 23,482
Medical Charities 750 4,500
), VFW Charities 1,430 6,403
Courage Center 1,000
... Easter Seals 100 1,000
Operation Uplink 400 1,000
; Missing Children MN 400
:iJ School Programs 7,550. 4,500
1"'-'1 Color Guard 2,742 1,400
~ Fire Arms Safety 859 375
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~';;.~ Scouting 800 5,140
~ Flags 2,155 2,991
Prodigal House 200
Homeward Bound 2,500
Hopkins Lions Club (200) 1,500
!
t,:: Special Olympics 100 3,100
..
Fort Snelling Museum 100 500
I Muskies, Inc. 200 500
MN Veterans Programs 5,910 4,240
Reach for Resources 200 500
Memorials 600
I MN Council on Compulsive Gambling 200
MN National Guard 200
Union Gospel Mission 1,000
MusicAssociation of Minnetonka 100
American Cancer Society 100 100
Vinland Center 2,000
YMCA 200 100
55,790 100,544
$ 375 323 $ 409,992
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