MN HF3688

Gross profits from lawful gambling may only be expended for lawful purposes or allowable expenses as authorized by the membership of the conducting organization at a monthly meeting.

Organizations expending 50 percent or more of gross profits on lawful purposes receive a five-star rating; ratings decrease by one star for each 10 percent decrease in lawful purpose expenditure down to a one-star rating for less than 20 percent expenditure.

Organizations failing to expend a minimum of 30 percent annually of gross profits on lawful purposes are automatically placed on probation for one year effective July 1 and must increase their rating or face license suspension or civil penalties up to $10,000.

When determining suspension or penalties, the board must consider unique factors or extraordinary circumstances including capital asset purchases, construction impacts, and natural disasters affecting gambling operations.

For bingo-primary organizations, the board must additionally consider facility-associated expenses, labor amounts, and costs directly related to conducting bingo operations.