CR2003-046 app for gambling HYHA
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March 13, 2003
Council Report 2003-046
Application for Charitable Gambling Premises Permit
Hopkins Youth Hockey Association
Proposed Action
Staff recommends adoption of the following motion: adopt resolution 2003-028, .
resolution denying a premises permit for the Hopkins Youth Hockey Association at
Tuttle's Hopkins Recreation, 107 Shady Oak Road.
Overview
The Hopkins Youth Hockey Association has applied for a premises permit to sell pull-
tabs at Tuttle's Hopkins Recreation. There are several discrepancies between the
information received from the Association and the information received from the
Gambling Control Commission. Staff is recommending denial because they do not
comply with the conditions of Policy 4-A, Lawful Gambling.
Primary Issues to Consider
. Does the Hopkins Youth Hockey Association meet the location requirements?
. Does the City allow more than one charitable establishment to conduct the same
game at the same location?
. Other Discrepancies
Supportina Documents
. Resolution 2003-028
. Copy of Policy 4-A, Lawful Gambling
. Letters from the Raspberry Festival
. Copy of the minutes of general membership meeting, Hopkins Youth Hockey
Association
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Terry Obermaier, City Clerk
Financial Impact: $ Budgeted: Y/N
Related Documents (CIP, ERP, etc.):
Notes:
Source:
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Council Report 2003-046
Page 2
. Does the Hopkins Youth Hockey Association meet the location
requirements?
Section 2.02 of the City's Legislative Policy reads: 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.
After researching past documents, staff believes that location and office are
synonymous and does not believe that the Hopkins Youth Hockey Association has a
permanent location. They have filed the address of the Hopkins Pavilion with the
Secretary of State's office for the purpose of obtaining a current Certificate of
Incorporation. In the State application with the Gambling Control Board, they have
given a post office box number as the organization location. They have given two
addresses in Minnetonka as the addresses where the records will be stored. The
Articles of Incorporation list the "registered office" as the City of Hopkins, Minnesota
55343. The next section of the Articles of Incorporation states that the Corporation may
have such other offices, including its principal business office, either within or without
the State of Minnesota.
While they do have a lease for the concession stand at the Pavilion, the Hopkins Youth
Hockey Association does not have an office at the Pavilion. They do conduct the
business of operating a concession stand at the Pavilion, but the Pavilion is not where
they conduct corporate business just as they would not be conducting corporate
business at Tuttle's if they lease space to operate a pull-tab stand. The Pavilion does
not accept mail from the post office for the association. They do have a drop box at the
Pavilion. The only place that they receive mail is a post office box.
In past years, several organizations were denied premises permits because of location.
Some of those organizations were Cystic Fibrosis Foundation, The Exchange Club of
Minneapolis, Family Plus, Inc., Braille Sports Foundation, Hopkins/Minnetonka Babe
Ruth, Inc., and the Golden Valley Baseball Inc.
· Does the City allow more than one charitable establishment to conduct the
same game at the same location?
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SeCtion 2.07 of Policy 4-A, Lawful gambling reads: 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.
The first part of the paragraph indicates that two organizations can conduct gambling at
the same location; however, the last sentence states that they cannot both conduct the
same game. Staff researched past minutes and council reports for the intent of this
section. The intent is that only one organization can sell pull-tabs in a location, or that
only one organization can conduct bingo at a location, or that one organization can
conduct bingo while another organization is selling pull tabs. Two organizations could
Council Report 2003-046
Page 3
operate a pull-tab booth together. There cannot be two pull-tab booths at the same
location, run by two different organizations.
Staff received copies of two letters from the Raspberry Festival. The first letter was
addressed to the Tuttles and stated that the Raspberry Festival Gambling Manager, Jim
Mashek, would allow Tuttles Hopkins Recreation Center to break the lease that they
hold with the Raspberry Festival and allow the Hopkins Youth Hockey Association to
sell pull-tabs at the center. The second letter was also addressed to the Tuttles and
stated that procedure was not followed in the first letter. Mr. Mashek stated in the
second letter that the Festival needed a written request from the Recreation Center;
that the whole board of the Raspberry Festival needed to vote on the request; and that
Mr. Mashek did not have the authority to grant permission to break the lease.
In light of the second letter, the Raspberry Festival still holds a valid lease with Tuttle's
Hopkins Recreation Center. That premises permit was granted in October 2001 and
runs through December 31 2003. According to City policy, the City cannot approve
another pull-tab operation for that location.
. Other Discrepancies
The City's Lawful Gambling Policy, Policy 4-A, Section 1.02 states that "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.
The City's Gambling Policy, 4-A, Section 2.03 requires that the organization have 30
active votinq members.
Minnesota Statute Section 349.12, Subd. 2. states as follows: Subd. 2. Active
member. "Active member" means a member,who has paid all dues to the
organization, who is 18 years of age or older, who has equal voting rights with all
other members, who has equal opportunity to be an elected officer, who has equal
right and responsibilities of attendance at the regularly scheduled meetings of the
organization, whose name and membership origination date appear with the
member's knowledge and consent on a list of members of the organization, and
who has been a member of the organization for at least six months.
Of the list of 323 members that were given to us by the association, 307 of the
members do not have active voting rights equal to the active voting rights of the
board. The board has 16 members with equal voting rights. Hopkins Policy 4-A
requires 30 active voting members.
. Alternatives
1. Deny the application because the organization does not meet location requirements,
does not have the required 30 active voting members, and because a permit for
'another organization has been approved for that location.
2. Continue the item for more information.
3. Approve the application
Staff recommends alternative one.
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CITY OF HOPKINS
Hennepin County, Minnesota
RESOLUTION NO. 2003-028
Denying a Lawful Gambling Premises Permit
To the Hopkins Youth Hockey Association
WHEREAS, the City of Hopkins has an existing policy limiting charitable gambling to
those charities which have their principal location within the city, and
WHEREAS, the City of Hopkins has an existing policy that limits the number of
organizations that can conduct the same lawful gambling game at one location,
and
WHEREAS, the City of Hopkins has an existin'g policy limiting charitable gambling to'
those organizations that have at least 30 "active voting members", and
WHEREAS, the City of Hopkins in "Policy 4-A, Lawful Gambling" has adopted the
provisions of Minnesota Statute Chapter 349 relating to the definition of terms;
and
WHEREAS, a premises permit has already been approved for pull tabs at the requested
location, Tuttle's Hopkins Recreation; and the Hopkins Youth Hockey
Association has not demonstrated a permanent physical location to conduct
corporate business within the City of Hopkins; and the Hopkins Youth Hockey
Association does not have 30 active voting members as defined by State Statute
349.12, Subd. 2;
NOW THEREFORE BE IT RESOLVED, that the City Council of the City of Hopkins
hereby denies the application for a permit to conduct lawful gambling by the
Hopkins Youth Hockey Association at the following location:
Tuttle's Hopkins Recreation Center
107 Shady Oak Road
Hopkins, MN 55343
Adopted by the City Council of the City of Hopkins this 15th day of April, 2003. '
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ATTEST:
Terry Obermaier, City Clerk
By
Eugene J. Maxwell, Mayor
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1.
1.01
2.
2.01
2.02
02.03
2.04
2.05
2.06
2.07
2.08
POLICY 4-A
LAWFUL GAMBLING
PURPOSE
The purpose of this policy is to establish rules and procedures for lawful gambling in
the City of Hopkins.
REGULATIONS
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
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.
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.
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.
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.
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.
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.
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
Legislative Policy Manual -- Chapter 4-A
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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 $100.00 shall be charged to all organizations submitting a Premises Permit
Application or Applications for approval by the City.
Established 11/19/85 by Resolution 85-3218
Revised 4/19/94
RevIsed 12/16/97
City of Hopkins
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Legislative Policy Manual -- Chapter 4-A
2
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, HOPKINS
" RASPBERRY FESTIVAL, INC.
P.O. BOX 504 · HOPKINS, MINNESOfA 55343
CAPIT~~
Mr. 's Tim aad MD Tuttle
TwtJe'1 BowliDg, Bar III Grill
10':' Sb8dy 0IIk RA. HopIdJII
Tmlmd Mike.
rcpnliDa our COIMSI'IItioD on2l10l0l, Pcrtailda& to a duge in charitable aambHDa
OI1llllizlltio.. .&om 1he BopkiDs hapbcrry Festival to the Hopkius Youth Hockey AaIIL,
tballetter is to wrIfy our IfIRCIDeDf. that upon H.Y.H.A. meedaa aJl8Cate anclloeal regulltioDl
IDeI restrictions in their SambliDa pa.....ws appJlcatioD, we ( R.IlF.A.) would re1iDquilh. &ad
void our pnlKDt ICtMJ !cue. wIUd1 npha 12131103. After reviewiDa our reconis aDd
COIt1iderins the combined receipts UIX year, we haw coDCluded thai. tIIouJd we be ukecl
to :brao m Ieue., we would aar= 10 VllCate May 31,2003.
J reIVa' that we will only reIeaIe the parties fi'om ourGve Jeae continsent 011
It Y.H.A. adequately ~I aD. local and !lite restriccions ill the application proeea.
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SiDcaRJy. ran Mabek
<lamias Manager
Hopkios Raspben)r FeltMl
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HOPKINS
RASPBERRY FESTIVAL, INC.
RO. BOX 504 · HOPKINS, MINNESOTA 55343
CAPIT~\..
3/27/03
Mr. 's Tim and Mike Tuttle,
It has come to my attention that proper procedure regarding the termination of our lease
with you to operate gambling in your establishment was in err on the following accounts:
1.) A notice on your letterhead describing your desire to prematurely terminate our lease
agreement is to be signed and sent to our office. That notice should contain the reason
for the change, the organization to which your are changing, and the desired effective
date of the change. Copies of that letter are to be sent to the incoming organization,
which will include it in their premise permit application to the city. Upon their receipt
of a resolution from the City Council, that information is then provided to the state of
Minnesota.
2.) The letter of our intent is a response to the above-mentioned notice, and will then be
sent to you, and copies are to be sent to the incoming organization which will include
it in their premise pennit application to the city. Upon receipt of a resolution from the
City Council, that information is then provided to the state of Minnesota.
3.) I did not have proper authority to make the decision disclosed in my previous letter.
That decision must be brought before the Festival Board of Directors and approved
by a simple majority of that Board. Our next scheduled Board meeting is Monday,
April 14,03 at 7:30 P.M.. The decision of the Board must be included in the minutes
of that meeting, at which point I must send a copy of the minutes and a notification of
our intentions to the Gambling Control Board.
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For these reasons, I must rescind the content of the previous letter regarding this matter and
this disclosed termination protocol must be implemented. Apologies for the confusion.,
Sincerely, Jim Mashek
Gaming Manager
Hopkins Raspberry Festival
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HOPKINS
RASPBERRY FESTIVAL, INC.
RO. BOX 504 · HOPKINS, MINNESOTA 55343
CAPITft.\"
Ms. Terry Obermeier
City Clerk
City of Hopkins
Dear Ms. Obermeier,
I would like to voice my opposition to the recent gambling permit application submitted
by Hopkins Youth Hockey Association at Tuttle's Bowl,Bar & Grill. On Monday, February 17,'03
Tim and Mike Tuttle met with Patricia Sola and me and informed us that they wished to bring in a
different charity to operate lawful gambling. We were informed to "...not take it personally.", but
that they (Tuttles) felt that a wider distribution of gambling funds created a stronger community, and
that they (Tuttles) "...really like hockey." The Hopkins Raspberry Festival has an active lease with
Tuttle's effective until December 31, 2003. The Tuttles asked that we write a letter agreeing to
void our lease when and ifH.Y.H.A. received a permit from the state. We have not supplied such
a letter as of yet.
The Raspberry Festival has conducted a first rate, legal and accountable gambling operation
A Hopkins since 1986. Revenues annually support 50%-75% of the total cost of the Hopkins
~pberry Festival celebration. Additionally, gaming revenues provide $6,500.00 in scholarships
for participants in the Festival Royalty program. We have had consistently strong relationships with
the owners from which we lease space and have equally strong relationships with the business and
residential communities in Hopkins. After 68 years of service and committment to Hopkins, we find
the request of the Tuttles suprising and disheartening. There is also a concern that the hockey group
could conceivably attempt to influence other bar owners, incapacitating the civic responsibilities and
contributions, and even the existence, of the Raspberry Festival and the Hopkins Jaycees.
I challenge the actuallity ofH.Y.H.A.'s claim to five consecutive years at a Hopkins address,
and find it curious and disturbing that after a call to 411 information, there is no listing for a Hopkins
Youth Hockey Association, a Hopkins Hockey Association, or even a Hockey Association. Without
a listed Hopkins phone number or address, I'm curious how they've maintained a business in Hopkins,
and of how they proved their five year Hopkins residency, and how they prove that they're not applying
for this permit for the sole purpose of raising gambling revenues, which is against Minnesota Rule. It
also concerns me that their roster is disproportionately made up ofMinnetonka residents, which would
indicate that gaming revenues would benefit Minnetonka residents by the same ratio. The Festival has
no issues with the fine people ofMinnetonka, but have always realized a necessity for Hopkins gaming
revenues to benefit largely Hopkins residents.
The Festival feels that approving this new gambling permit could have a short and long-term
negative impact on the social and civic capacities and contn'butions of both the Hopkins Raspberry
Festival and the Hopkins Jaycees.
Thank you for your consideration in this difficult decision.
Sincerely, James Mashek
Gaming Manager
Hopkins Raspberry Festival
H.Y.H.A.
Special Meeting of the General Membership
3/17/03
6:30 PM
Eisenhower Community Center
Members Present
John Anderson, Scott Anderson, Jody Boyd, Brad Davis, John Dwyer, Bill Essel, Lisa
Hazuka, Larry Jocelyn, Mark Lescarbeau, Bruce Mobraten, John Ostroot, Tom Powers,
Matt Starr, Lynn Wiener
Members Represented by Proxy
131 Members. List available by request
Motion to approve Hopkins Youth Hockey Association operate a charitable gambling
business. Motion made by Jody Boyd, second by Lynn Wiener
Those present and represented by proxy voted:
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141 FOR
3 AGAINST
1 ABSTAIN
MOTION CARRIED
Motion to Adjourn by Lynn Wiener, second by Lisa Hazuka
Motion Carried
Meeting Adjourned 6:40 PM
Respectfully Submitted.
Matt Starr, President, HYHA