CR 2004-044 Charitable Gambling Premises Permit Application
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.. March 2, 2004 CR2004-044
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CHARITABLE GAMBLING PREMISES PERMIT APPLlCA TI()N FOR
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THE HOPKINS AMERICAN LEGION POST 320
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Staff recoml'l1eridsapprovalofthe following motiori: ,,' Move that the Hopkins City Council,
,adopt Resolutions 2004-016 , approving the . cl1aritablegambling premises permit for the '
Hopkins American Legion Post 320 "located at 1 0::" j 2th Ave S.
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Adoption of this resolution will allow the Hopkins Am eric !=1 11 Legion to continU~ to run the
existing charitable gambling activities at the Legion hall. " ; ,
Overview
. The HopkihS American Legionhas requested arehewalof their gambling license
and premises permit. They conduct charitabl,egambling' at the Legion haUonly.
"Primary Issue$ to Consider'
. Does this organization meet the criteria of the.CitY'sg~rnbling policy?
. Yes -e:\
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. Has the organization conducted its past gambling operations in accordance with
state and local laws? ' '
Yes
Supporting Documents ' ,
... Resolutions 2004-16
. 'Legislative Policy 4-A, L.awful Gambling "
. F.inancial Statement and Independent Auditor's Report, Years ending December,
2002 and'2001 "'.. ' . '
. List' of donatiqns made by the Legion.. '
. Gamblihg License Application available in the City Clerk's .office
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Council Report 2004~044
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Alternatives
1. Approve Resolutions 2004:-016, allowing the Hopkins American "Legion to continue'
the present gambling activities at the present locations.
2. Do not approve the resolutions with the result that the Hopkins American Legion
will no longer have gambling in the City cifHopkins. ':,
3. Continue the iteh1formore information.
Staff recommends alternative one.
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'. , , CITY OF HOPKINS "
HENNEPIN COUNTY, MINNESOTA
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RESoLuTION 2004-016 '
RESOLUTON APPROVING A,GAMBUNG
L1CENSE"FOR THE HPPKINS AMERICAN LEGIONPOST'320
WHEREAS, the Hopkins American Legion Post 320 has beenarl important
part of the City of Hopkins, and;
;, WHEREAS, the Hopkins American Legion Post 320 ,has appl.ied for a renewal
of its gambling license to conduct lawful gambling; and; ,
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. WHEREAS, the Hopkins American Legion Post 320 has conducted its"
gambling operation inaccordancevvith the laWs of the State6f Min. nesota and
Hopkins City Policy, . '. . , ,.'. >
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." ,. NOW, THEREFORE, be it hereby. resolved that theCityCouncilof the City of
, Hopkins, Minnesota cfpproves the Hopkins American Legion Post' 320 Pr~mises
, i Permit Renewal application t() operate lawful gambling at the Hopkins)\merican
legion Post, 10 - 12th Avenue South.
"Adopted by the ~ity Council of the City6f Hopkinsthis3rd dayof'March, 2004. ,
By
Eugene J. Maxwell, rvlayor '
ATTEST:
T erryObermaier '" City Clerk
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. LAWFuL GAMBLING
1. PURPOSE
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1.01 .The purpose of this policy is' to establish rules and procedures for lawful gambling in
the City of Hopkins. ,
2. REGULATIONS
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2.01 Except as oth~rwise enumerated hereint the provisions, of Minnesota. Statute Chapter,
349 relating to the definition of tennst licensing and restrictions of gambling are
adopted and made a part of the statement of policy promulgated by the City ofl:Iopkins
as if set out in full :
2.02 "Anapplicant fora license shall bea registered Minnesota nonprofitc~rporation or an
organization which is' designated as exempt from the' payment of income taxes by the
Internal Revenue Code and has its principal or. registered officetstreet address and zip
code within the City of Hopkins.
2.03 The organization defined in Section 2.02 must be engaged in its 'primary activities for
the benefit of the. community within the City of Hopkins for at least five years on a
perpetualt continuoust uninterrupted basis and have at. least 30 .active tl}embers as'
. defined in Minnesota Statute Chapter 349.
2.04 "Gambling allowed by the city shall be carried on only withinpremisesownedt occupied
or leased by the organization except such activities pennissibleunder M;S. 349.166. .
2.05 '. No application for a premises. permit will be approved for any orgarnzation to conduct
, gambling' on ,any premises other than the premises of anon~sale . liquor licensee or the
premises of a fraternal" veterans or other non~profit organization. hi order for a
fraternalt veteranst or other, non-profit, .orgariizatiort 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 pel111it shall be approved for any
organization fora 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 permit or license to conduct bingo will only be approved for an organization that is
licensed pursuant to MinnesotaStatutet section 349J6t and that conducts gambling on
premises that it owns and operates.
2.07 Only one organization, as dermed in Section 2.02t ,may conduct gambling within a
single ownedt occupied or leased premise.
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Legislative Policy Manual -- Chapter 4-A 1
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. 2.08 Th. e, operation ofgamb.ling. devi,ces and the ,c.onduc~of,b.ing()~.draffles'.li~en~e,d,or
approved pursuant to the authontygranted to,the CIty of Hopkins, shall be. carned 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 oper~tion. ' '
2.09 'The gambling manager shall be ~ active member of the orgaiIization issued the license
, and shall qualify under state law.., '
2.10 Organizations seeking ~pproval for a 'premises permit, that are not current1yconci~cting'
gambling in the City, mustprovide the City~ in addition.fo the applipationforlUs, a copy
of the notice sent 'to the general'membership announcing" the meeting ,to., authorize
gambling activities, and' a copy of the minutes. ofa 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 beperform~d by an independent acccH.mtantlicensedbythe state of '
Minnesota.
.'. 2.13 In addition, such organizations must provide the City with il1forinatioh on all
, expenditures oflawful gambling funds during the previous two years. Suchinfonnation.
must include at a minimum the name of the recipient, the: amount ofthe'expenditu.re or '
contribution, and a brief description' of how' the expenditure. or contribution meets the
definition of "lawful purposes", as 'defined inM.S. 349;12.. The' City reserves the right to
require additional-docUmentation froJ.11licensed organizations,br organizations seeking ,
licenses, as it deems necessary.;, .', .," '. :.",! ,.'" '.,'., .', ," .," .
2.14 A fee of $100.00 shall be charged: to all organizatioris submitting a Premises Permit
Application or Applicationsforapprchral by t~e City.~ ,."', '. ".','
2.15 The City shall receive 1 0% of net profits from org~izatiolis conducting gambling in
, leased premises.
Established 11/19/85 by Resolution 85-3218
" ' " Revised 10/5/1993
Revised 4/19/94
Revised 12/16/97
Revised 8/19/2003
City of Hopkins
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Legislative Policy Manual -- Chapter 4-A ' 2
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. Lawful Gambling Fund of J
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Hopkins American Le'gion Post #320 I:
(License #A-00225)
Statement of Assets, Liabilities and 'Fund Balance {
Regulatory Basis I
For the Years Ended December 31,2002 and 2001
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ASSETS .I
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2002 2001 I
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Cash i
Gambling Bank Account $26,019 $ 40,441
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Savings Account-Interest Bearing 21,658 21,486' ,
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Starting Game Banks 4,800 '4,800
Total Cash 52,477 66,727
Inventories
Games 2,401. 2,239
Total Assets $ 54,878 $ 68,966
LIABILITIES
. Accounts Payable
State Taxes Payable $ 14,756 $ 13,757
Due to Game Vendors 633 ---
Unearned Revenue ,,930 270 I
Unpaid Prizes 907 755
17,226 14,782
PROFIT CARRYOVER
Fund Balance
Profit Carryover 37,652 54,184
Total Liabilities & Profit Carryover $ 54,878 $ 68,966
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See accompanying Notes and Auditor's Report
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. Lawful. Gambling, Fund of
Hopkins American Legion Post #320
(License #A-00225)
Statement of Revenues, Expenses & Changes in Profit.Carryover
Regulatory Basis
For the Years Ended December 31 ,2002 and 2001
2002 2001
Amount % Amount %
REVENUES
Pulltab receipts $ 3,058,285 $ 2,668,292 !
Tipboard Receipts --- 870
Paddletickets 25,500 19,500 I:.
Interest Income 172 284 r
3,083,957 2.688.946
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COST OF REVENUES it
PuJltab Prizes 2,693,048 2,335,456
Tipboard Prizes --- 435
Paddletickets 14.554 9.750 :
, 2,707,602 2.345.641
GROSS PROFIT 376,355 100.0% 343,305 100.0% ;
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. ALLOW ABLE EXPENSES 168;018 ,44.6 44.4 ,
152.333 ,
REVENUES IN EXCESS OF
ALLOWABLE EXPENSES 208,337 55.4 190,972 55.6
LAWFUL PURPOSE EXPENDITURES
State Combined Receipts Tax 120,281 32.0 $ 100,442 29.3
State Net Receipts Tax 930 .2 829 .2
State Ideal Gambling Tax $ 67,257 $ 60,769
Less Refund 15.790 51 ,467 13.7 10,516 50,253 14.6
Federal Gambling Taxes 7,592 2.0 6,711 , 2.0
Audit Fee 2,400 .7 2,300 .7
Real Estate Taxes 13,567 3.6 13,873 4.0
Program Expenditures 28.632 ....l& 31 ,423 ~
224,869 59.8 205,831 60.0
REVENUES IN EXCESS OF EXPENSES (16,532) (4.4)% (14,859) ~%
ProfitCarry-Over-Beginning of Year 54.184 69.043
PROFIT CARRY-OVER END OF YEAR $ 37 .652 $ 54.184
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See accompanying Notes and Auditor's Report
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. ' Lawful Gambling Fundof ,
Hopkins American Legion Post~320
(License #A-00225)
Games Used - Regulatory Basis
For the Years Ended December 31 ,2002 and 2001
2002 2001
Number Number '
Amount of Games Amount of Games
PULL TABS
Cost of Games Used:
Beginning 'I nventories $ 2,224 53 $ 2;372 57
Purchases 43,766 989 40,600 911
45,990 1,042 42,972 968
Less Ending Inventories (2,296) (57) (2,224) JQm
Subtotal 43,694 985 40,748 915
Games Reported
on Schedule B-2 985 ' 915
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Difference 0 : 0
PAD DLETICKETS
. Cost of Games Used:
Beginning Inventories 15, 1 0 0
Purchases 368 ~ ,210 ..H
383 24 210 14
Less Ending Inventories (105) -11.) (15) -1.1)
Subtotal 278 17 195 13,
Games Reported
On Schedule B-2 -1Z .n
Difference 0 0
Cost of G,-?-mes Used $ 43,972 $ 40.943
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. Lawful Gambling Fund of
Hopkins American Legion Post #320
(License #A-00225)
Analysis of Maxinium Allowable Expenses
As a Percentage of Gross Profit
Regulatory Basis
For the Years Ended December 31.2002 and 2001
2002 ,2001
Amount % Amount ,%
REVENUES $ 3,083,785 $ 2,688;662
COST OF REVENUES 2,707,602 2,345,641
376,183 343,021
INTEREST INCOME 172 284
GROSS PROFIT 376,355 100.0% 343,305 100.0%
ALLOW ABLE EXPENSES
Cost of Games Used 43,972 11.7 40,943 11.9
. ,?ompensation &
Payroll Taxes 91,206 24.2 92,724 27.0
Legal & Accounting 8,500 2.3 8,300 2.4
Advertising 695 .2 2,430 .7
Office Supplies, Bank Charges, Misc. 5,747 1.5 3,621 1.1
Penalty --- --- 30 ---
Utilities 10,212 2.7 --- ---
Licenses & Bond 550 .1 100 .1
Insurance, 1,109 .3 --- ---
Cash Shortage 2,968 .8 840 .2
Equipment and Maintenance 3,059 .8 3,345 1.0
Total Allowable Expenses 168,018 44.6% 152,333 44.4 %
Maximum Allowable Expenses
by Minnesota Statute 206,900 188,817
Excess of Maximum Allowable
Expenses-Current Year $ 38,882 $. 36,484
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. Lawful GamblihgFund of
Hopkins American Legion Post #320
(License #A-00225)
Reconciliation of Profit Carry-Over
Regulatory Basis
For the Years Ended December 31 ,2002 and 2001
. ADDITIONS 2002 2001
Cash in Savings Account $ 172 $ 283
Ending Inventories - Games 162 ---
Total Additions 334 283
. SUBTRACTIONS:
Cash in Gambling Bank Account 14,422 11 ,1 35
Starting Game Banks --- 658
Unpaid Prizes, 152 11
Ending Inventories - Games --- 133
Ending Inventories - Prizes --- 72
Due to Game Vendors 633 ---
Unearned Revenue 660 270
Taxes Payable 999, 2,863
Total Subtractions 16,866 15,142
. Profit Carry-over (16,532)
Current Year (14,859)
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Profit Carry-ov~r.,
Beginning of Year 54,184 69,043
Profit Carry-over From
Financial Statements 37,652 54,184
Profit Carry-over from
Department of .Revenue 37,650 54,404 '
Variance from Balance $ 2 $ (220)
Analysis of Variance
Cash Over/Short 2 (220)
Interest Income Added Twice 1998 ---
Stale Checks Added Back ---
$ 2 $ (220)
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. Lawful Gambling Fund of
Hopkins American Legion Post #320
(License #A-00225)
Lawful Purpose Program Expenditures - Regulatory Basis
For the Years Ended December 31. 2002 and 2001
2002 2001
TAXES
Federal Excise Taxes $ 7,592 $ 6,711
State Net Receipts Tax 930 829
State Ideal Gambling Taxes ; $ 67;257 $ 60,769
Less Refund 15,790 51,467,. ,10,516 50,253
Combined Receipts Taxes 120,281 100,442
Real Estate Taxes '13,567 13,873
Subtotal 193,837 172,108
Audit Fees 2,400 2,300
GRANTS
Families in Need 367 600
World War" Memorial --- 100
Make A Wish 5'0 '---
We Can Ride, --- 100
Hopkins Fire Dept. 1,000 ---
. Youth Sports 6,702 8,655
Children's Events 1,588 1,461
Veterans Funds 1,945 2,066
Camp Heartland 200 100
Salvation Army --- 600
Serviceman's Center 100 ---
School Programs 2,489 2,545
Color Guard 1,320 1,920
Scholarships 6,000 4,650
Scouting 436 200
Legionville School Patrol --- 400
Helping Paws MN 100 100
Fort Snelling 100 350
Civil Air Patrol Winterfest Carnival 60 60
4H --- 100
, Multiple Sclerosis Walk-a-thon. 250 200
MN Council/Compulsive Gambling --- 860
Disabled Assistance 726 520
Boys State 1,065 ---
Special, Olympics 490 150
March of Dimes 25 35
American Red Cross --- 100
. Friendship Ventures --- 100
Hearing & Service Dogs 150 100
Hospitals 50 300
Women's Shelter 100 ---
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. Hopkins Lions 100 ---
Hopkins Crime Prevention --- 1,000
American Heart Association 100 ---
American Co-ed Pageant 500 ---
Epilepsy Foundation 100 ---
United Cerebral Palsy 250 ---
Cancer Society --- 100
St. Josephs Church --- 3,200
Medical Assistance 936 ---
Flag Programs -1,283 751
Total 28,362 31,423
Total Lawful Purpose Expenditures $ 224.869 $ 205.831
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