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Ordinance 7161 CITY OF CHANHASSEN CARVER AND HENNEPIN COUNTIES, MINNESOTA ORDINANCE NO. 716 AN ORDINANCE AMENDING THE CITY CODE CONCERNING REGULATION OF LAWFUL GAMBLING THE CITY COUNCIL OF CHANHASSEN, MINNESOTA ORDAINS: SECTION 1. Article 10-V “Gambling” of the Chanhassen City Code is amended in its entirety to read as follows: Sec 10-150 Adoption of State Law by Reference The provisions of Minn. Stat. ch. 349, as they may be amended from time to time, with reference to the definition of terms, conditions of operation, provisions relating to sales, and all other matters pertaining to lawful gambling are hereby adopted by reference and are made a part of this ordinance as if set out in full. It is the intention of the Council that all future amendments of Minn. Stat. ch. 349, are hereby adopted by reference or referenced as if they had been in existence at the time this ordinance was adopted. Sec 10-151 City May be More Restrictive Than State Law The Council is authorized by the provisions of Minn. Stat. § 349.213, as it may be amended from time to time, to impose, and has imposed in this ordinance, additional restrictions on gambling within its limits beyond those contained in Minn. Stat. ch. 349, as it may be amended from time to time. Sec 10-152 Purpose The purpose of this ordinance is to regulate lawful gambling within the City of Chanhassen, to prevent its commercialization, to ensure the integrity of operations, and to provide for the use of net profits only for lawful purposes. Sec 10-153 Definitions In addition to the definitions contained in Minn. Stat. § 349.12, as it may be amended from time to time, the following terms are defined for purposes of this ordinance: (a) Board, as used in this ordinance, means the State of Minnesota Gambling Control Board. (b) City, as used in this ordinance, means the City of Chanhassen. (c) Council, as used in this ordinance, means the City Council of the City of Chanhassen. DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B 2 (d) Licensed Organization, as used in this ordinance, means an organization licensed by the Board. (e) Local Permit, as used in this ordinance, means a permit issued by the city. (f) Trade Area, as used in this ordinance, means this city and each city and township contiguous to this city. Sec 10-154 Applicability This ordinance shall be construed to regulate all forms of lawful gambling within the city except bingo conducted within a nursing home or a senior citizen housing project or by a senior citizen organization if the prizes for a single bingo game do not exceed $10, total prizes awarded at a single bingo occasion do not exceed $200, only members of the organization, residents of the nursing home or housing project, and their guests, are allowed to play in a bingo game, no compensation is paid for any persons who conduct the bingo, and a manager is appointed to supervise the bingo. Sec 10-155 Lawful Gambling Permitted Lawful gambling is permitted within the city provided it is conducted in accordance with Minn. Stat. §§ 609.75-.763, inclusive, as they may be amended from time to time; Minn. Stat. §§ 349.11-.23, inclusive, as they may be amended from time to time; and this ordinance. Sec 10-156 Council Approval Lawful gambling authorized by Minn. Stat. §§ 349.11-.23, inclusive, as they may be amended from time to time, shall not be conducted unless approved by the Council, subject to the provisions of this ordinance and state law. Sec 10-157 Application and Local Approval of Premises Permits (a) Any organization seeking to obtain a premises permit from the Board shall file with the city clerk an executed, complete duplicate application, together with all exhibits and documents accompanying the application as will be filed with the Board. Each organization licensed to conduct lawful gambling in the City shall complete the City's investigation form, submit copies of all state gambling application forms, all records and reports required to be filed within the State Gambling Control Board pursuant to Minnesota Statues, Chapter 349, and the rules and regulations promulgated thereunder, and submit any additional information required by the City. (b) Upon receipt of an application for issuance of a premises permit, the city cl erk shall transmit the application to the county sheriff for review and recommendation. (c) The county sheriff shall investigate the matter and make the review and recommendation to the City Council as soon as possible, but in no event later than 45 days following receipt of the notification by the city. DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B 3 (d) Organizations applying for a state-issued premises permit shall pay the city an investigation fee established by ordinance. This fee shall be refunded if the application is withdrawn before the investigation is commenced. If approved by the City Council and the Board, a licensed organization will be responsible for an annual investigative fee for conducting lawful gambling within the city. (e) The applicant shall be notified in writing of the date on which the Council will consider the recommendation. (f) The Council shall receive the county sheriff’s report and consider the application within 45 days of the date the application was submitted to the city clerk. (g) The Council shall by resolution approve or disapprove the application within 60 days of receipt of the application. (h) The Council shall deny an application for issuance or renewal of a premises permit for any of the following reasons: (1) An applicant’s officer, director, or other person in a supervisory or management position a. has been convicted of a felony within the last five (5) years; b. has ever been convicted of a crime involving gambling; c. is not of good moral character or repute; d. has ever been convicted of 1. assault, 2. a criminal violation involving the use of a firearm, or 3. making terroristic threats; e. owes delinquent local, state or federal taxes, or is delinquent on any other city bill. (2) The premises is in violation of any land use or zoning ordinance or owes delinquent local, state or federal taxes, or is delinquent on any other city bill. (3) Violation by the gambling organization of any state statute, state rule, or city ordinance relating to gambling within the last three (3) years. (4) Violation by the on-sale establishment or organization leasing its premises for gambling of any state statute, state rule, or city ordinance relating to the operation of the establishment, including, but not limited to, laws relating to alcoholic beverages, gambling, controlled substances, suppression of vice, and protection of public safety within the last three (3) years. (5) Lawful gambling would be conducted at premises other than those for which an on-sale liquor license has been issued. (6) Failure of the applicant to pay the investigation fee provided by Subdivision 4 within the prescribed time limit. DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B 4 (7) Operation of gambling at the site would be detrimental to health, safety, and welfare of the community. Otherwise, the Council shall pass a resolution approving the application. Sec 10-158 Local Permits (a) No organization shall conduct lawful gambling excluded or exempted from state licensure requirements by Minn. Stat. § 349.166, as it may be amended from time to time, without a valid local permit. This section shall not apply to lawful gambling exempted from local regulation by Section 10-154 of this ordinance. (b) Applications for issuance or renewal of a local permit shall be on a form prescribed by the city. The application shall contain the following information: (1) Name and address of the organization requesting the permit. (2) Name and address of the officers and person accounting for receipts, expenses, and profits for the event. (3) Dates of gambling occasion for which permit is requested. (4) Address of premises where event will occur. (5) Copy of rental or leasing arrangement, if any, connected with the event, including rent to be charged to the organization, which rental or leasing arrangement may not provide for rental payments based on a percentage of receipts or profits from lawful gambling. (6) Estimated value of prizes to be awarded. (c) The fee for a local permit shall be as established by city ordinance. The fee shall be submitted with the application for a local permit. This fee shall be refunded if the application is withdrawn before the investigation is commenced. (d) Upon receipt of an application for issuance or renewal of a local permit, the city clerk shall transmit the notification to the county sheriff for review and recommendation. (e) The county sheriff shall investigate the matter and make review and recommendation to the City Council as soon as possible, but in no event later than 45 days following receipt of the notification by the city. (f) The applicant shall be notified in writing of the date on which the Council will consider the recommendation. (g) The Council shall receive the county sheriff’s report and consider the application within 45 days of the date the application was submitted to the city clerk. DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B 5 (h) The Council shall deny an application for issuance or renewal of a local permit for any of the following reasons: (1) Violation by the gambling organization of any state statute, state rule, or city ordinance relating to gambling within the last three (3) years. (2) Violation by the on-sale establishment, or organization leasing its premises for gambling, of any state statute, state rule, or city ordinance relating to the operation of the establishment, including, but not limited to, laws relating to the operation of the establishment, laws relating to alcoholic beverages, gambling, controlled substances, suppression of vice, and protection of public safety within the last three (3) years. (3) Operation of gambling at the site would be detrimental to health, safety, and welfare of the community. Otherwise, the Council shall approve the application. Sec 10-159 Revocation and Suspension of Local Permits (a) A local permit may be revoked or temporarily suspended for a violation by the gambling organization of any state statute, state rule, or city ordinance relating to gambling. (b) A local permit shall not be revoked or suspended until written notice and an opportunity for a hearing have first been given to the permitted person. The notice shall be personally served or sent by certified or registered mail. If the person refuses to accept notice, notice of the violation shall be served by posting it on the premises. Notice shall state the provision reasonably believed to be violated and shall also state that the permitted person may demand a hearing on the matter, in which case the permit will not be suspended until after the hearing is held. If the permitted person requests a hearing, the Council shall hold a hearing on the matter at least one week after the date on which the request is made. If, as a result of the hearing, the Council finds that an ordinance violation exists, then the Council may suspend or revoke the permit. Sec 10-160 Display of Permit All permits issued under state law or this ordinance shall be prominently displayed during the permit year at the premises where gambling is conducted. Sec 10-161 Notification Of Material Changes To Application An organization holding a state-issued premises permit or a local permit shall notify the city within ten (10) days in writing whenever any material change is made in the information submitted on the application. Sec 10-162 Contribution Of Net Profits To Fund Administered By City (a) Each organization licensed to conduct lawful gambling within the city pursuant to Minn. Stat. § 349.16, as it may be amended from time to time, shall contribute ten percent (10%) of DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B 6 its net profits derived from lawful gambling in the city to a fund administered and regulated by the city without cost to the fund. The city shall disburse the funds for charitable contributions as defined by Minn. Stat. § 349.12, subd. 7a, as it may be amended from time to time. (b) Payment under this section shall be made on the last day of each month. (c) The city’s use of such funds shall be determined at the time of adoption of the city’s annual budget or when the budget is amended. (d) An organization that conducts gambling on fewer than five days in a calendar year is exempt from the requirements of this section. Sec 10-163 Designated Trade Area (a) Each organization licensed to conduct gambling within the city shall expend fifty percent (50%) of its lawful purpose expenditures on lawful purposes conducted within the city’s trade area. (b) This section applies only to lawful purpose expenditures of gross profits derived from gambling conducted at a premises within the city’s jurisdiction. (c) An organization that conducts gambling on fewer than five days in a calendar year is exempt from the requirements of this section. Sec 10-164 Records and Reporting (a) Organizations conducting lawful gambling shall file with the city clerk one copy of all records and reports required to be filed with the Board, pursuant to Minn. Stat. ch. 349, as it may be amended from time to time, and rules adopted pursuant thereto, as they may be amended from time to time. The records and reports shall be filed on or before the day they are required to be filed with the Board. (b) Organizations licensed by the Board shall file a report with the city proving compliance with the trade area spending requirements imposed by Section 10-163. Such report shall be made on a form prescribed by the city and shall be submitted annually. Sec 10-165 Hours of Operation Lawful gambling shall not be conducted between 1 a.m. and 8 a.m. on any day of the week. Sec 10-166 Penalty Any person who violates any provision of this ordinance; Minn. Stat. §§ 609.75-609.763, inclusive, as they may be amended from time to time; or Minn. Stat. §§ 349.11-349.21, as they may be amended from time to time; or any rules promulgated under those sections, as they may be amended from time to time, shall be guilty of a misdemeanor and subject to a fine of not more than $1,000 or imprisonment for a term not to exceed 90 days, or both, plus in either case the DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B 7 costs of prosecution. In addition, violations shall be reported to the Board, and recommendations shall be made for suspension, revocation, or cancellation of an organization’s license. Sec 10-167 Severability If any provision of this ordinance is found to be invalid for any reason by a court of competent jurisdiction, the validity of the remaining provisions shall not be affected. SECTION 2. Effective Date. This ordinance becomes effective on the date of its publication or upon the publication of a summary of the ordinance as provided by Minn. Stat. § 412.191, subd. 4, as it may be amended from time to time, which meets the requirements of Minn. Stat. § 331A.01, subd. 10, as it may be amended from time to time. PASSED AND ADOPTED this 9th day of October 2023 by the City Council of the City of Chanhassen, Minnesota. ATTEST: Kim Meuwissen City Clerk Elise Ryan, Mayor (Summary Ordinance Published in the Chanhassen Villager on October 19, 2023) DocuSign Envelope ID: 34C06921-F039-493C-9888-060184A5816B CITY OF CHANHASSEN CARVER AND HENNEPIN COUNTIES, MINNESOTA SUMMARY OF ORDINANCE NO. 716 AN ORDINANCE AMENDING CHAPTER 10, LICENSES, PERMITS, AND MISCELLANEOUS BUSINESS REGULATIONS, ARTICLE 10-V, GAMBLING OF THE CHANHASSEN CITY CODE The purpose of this Code amendment is as follows: To address processes for issuing premises permits, exempt permits, and excluded permits for lawful gambling activities not regulated by the State of Minnesota Gambling Control Board, and to address due process issues. A printed copy of Ordinance No. 716 is available for inspection by any person during regular office hours at the office of the City Clerk. PASSED, ADOPTED, AND APPROVED FOR PUBLICATION this 9th day of October 2023 by the City Council of the City of Chanhassen. (Published in the Chanhassen Villager on October 19, 2023)