HOUSE DOCKET, NO. 4143        FILED ON: 3/20/2009

HOUSE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 4067

The Commonwealth of Massachusetts

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In the Year Two Thousand Nine

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An Act relative to gaming control..

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
 

SECTION 1. The General Laws are hereby amended by inserting after chapter l28C the following chapter:- Chapter l28D.  The Massachusetts Gaming Control Act. Section I. General Provisions.

(a) This chapter shall be known and may be cited as the "Massachusetts Gaming Control Act."

(b) No applicant for a license or other affirmative approval within the scope of this chapter has any property or other right to a license or to the granting of the approval sought. Any license issued or other approval granted pursuant to this chapter is a fully revocable privilege, and no holder acquires any vested right therein or thereunder.

(c) Nothing in this chapter shall preclude any city or town in the commonwealth from· prohibiting gaming, from imposing any local controls or conditions upon gaming, from inspecting premises to enforce applicable laws, or from imposing any fee or tax otherwise authorized, provided any prohibition, control, condition, inspection, tax, or fee is not inconsistent with this act, or the laws of the United States.

(d) In the event of any conflict between the provisions of this chapter and the provisions of any other general or special law , or local ordinance, the provisions of this chapter shall prevail.

Section 2. Definitions.

The following words as used in this chapter shall, unless the context clearly requires otherwise, have the following meanings:

(a) "Affiliate," any person that a licensee or applicant directly or indirectly controls or in which an applicant or licensee possesses an interest. For the purposes of this definition, "controls" means either (i) directly or indirectly holding more than ten percent (10%) of voting membership rights or voting stock or partnership interests, or (ii) that a majority of the directors, general partners, trustees, or members of an entity's governing body are representative of, or are directly or indirectly controlled by, the licensee or applicant. For the purposes of this definition, "possesses an interest in" means either (i) directly or indirectly holding more than (5%) of voting membership rights or voting stock, or

(ii) that at least twenty-five percent (25%) of the directors, general partners, trustees, or members of an entity's governing body are representatives of, or are directly or indirectly controlled by, the licensee or applicant;

(b) "Applicant," a person who has applied for a gaming license, work permit, or approval of any act or transaction pursuant to this chapter;

(c) "Bureau," the state gaming control bureau established by this act;

(d) "Commission," the Massachusetts gaming control commission;

(e) "Controlled game," or "controlled gaming," any game of chance, or skill, or both, played for currency, check, credit, or any other thing of value, and including electronic gaming devices and games classified as class II or class III gaming under the Indian Gaming Regulatory Act, 25 D.S.C. § 2701 et seq., but excluding:

(1) The game of bingo conducted pursuant to chapter two hundred and seventy-one;

(2) Parimutuel wagering on horse and dog races, whether live or simulcast, authorized under G.L. c. l28A and G.L. c. l28C;

(3) Any lottery game conducted by the state lottery commission, in accordance with G.L. c. 10, § 24.

(4) Games played with cards in private homes or residences in which no person makes money for operating the game, except as a player.

(f) "Electronic Gaming Device," means any game of chance mechanical, electronic or otherwise featuring coin drop and payout as well as printed tabulations, whereby the software of the device predetermines the presence or lack of a winning combination and payout; also microprocessor-controlled electronic devices that allow a player to play games of chance, which may be affected by an element of skill, activated by the insertion of a coin or currency or by the use of a credit and awards game credits, cash, tokens, replays or a written statement of the player's accumulated credits, which written statements are redeemable for cash; and including slot machines, video lottery terminals' and video facsimile machines of any type;

(g) Establishment," any building, room, place or other indoor or outdoor premises where any controlled gaming occurs, including all public and non-public areas of any such establishment;

(h) "Executive Director," the executive director of the bureau;

(i) "Gaming," to deal, operate, carry on, conduct, maintain, or expose for play any controlled gaming;

(j) "Gaming equipment," any equipment, device, object or contrivance, or machine, whether mechanical, electromechanical, or electronic, which is specifically designed or manufactured for use in the operation of gaming; (k) "Gaming license," or "license," any license or work permit missued by the commission under this chapter that authorizes the person named therein to engage or participate in controlled gaming or to operate electronic gaming devices, including work permits and licenses issued to gaming establishments, to gaming suppliers, to parties in interest, and to officers and directors of licensed persons or entities;

(k) "Gaming operation," one or more controlled game that is operated, carried on, conducted, maintained, offered or exposed for play;

(m) "Gaming establishment," any establishment licensed to conduct a gaming operation in the commonwealth under this chapter;

(n) "Gaming services" means providing services or goods to any licensed gaming establishment directly in conjunction with the operation of gaming, including security services, .training activities, promotional services, printing or manufacture of betting tickets and manufacture, distribution, maintenance, testing or repair of electronic gaming devices, or any person who furnishes

goods or services pursuant to which the person receives payments based on earnings, profits or net receipts from gaming;

(o) "Holding company," any corporation, firm, partnership,

trust, or other entity that, directly or indirectly, owns, has the power or right to control, or holds with power to vote, all or any part of the partnership interests or outstanding voting securities of a corporation or any other business entity that holds or applies for a gaming license. In addition, a holding company indirectly has, holds, or owns any power or right mentioned herein if it does so through any interest in a subsidiary or affiliate or successive subsidiaries or affiliates, however many of these subsidiaries or affiliates

may intervene between the holding company and the

corporate licenses or applicant;

(p) "Intermediary company," any corporation, firm, partnership, trust, or other entity, other than a natural person, that is both of the following:

(1) A subsidiary with respect to a holding company, and

(2) A holding company with respect to a corporation or limited partnership or other entity that holds or applies for gaming license;

(q) "Licensed operator," any operating entity that conducts a controlled gaming operation within a gaming establishment pursuant to a license or licenses issued under this Act.

(r) "Licensed premises," the premises upon which is located a gaming establishment pursuant to a license issued to a licensed operator;

(s) "Licensee," any person or party holding, or purporting to hold, a valid gaming license under this chapter;

(t) "Net gaming revenue," the total, prior to the deduction of any operating, capital or other expenses whatsoever, of all gaming revenue retained by any gaming establishment licensed under this chapter derived from the conduct of any controlled game; (u) "Operating entity," any person who conducts a gaming operation;

(v) "Party in interest," any corporation, firm, partnership, trust,

or other entity or person with any direct or indirect pecuniary interest in a licensed gaming establishment, or a person who owns any interest in the premises of a licensed gaming establishment, or land upon which such premises is licensed, whether he leases the property directly or through an affiliate;

(w) "Person" or "party," a natural person, corporation, partnership, limited partnership, trustee, holding company, joint venture, association, or any business entity;

(x) "Racing meeting licensee," the running horse racing meeting licensee in Suffolk County, hamess horse racing meeting licensee in Norfolk County, and dog racing meeting licensees in Suffolk and Bristol Counties licensed by the State Racing Commission pursuant to G.L. c. l28A, as amended, to conduct parimutuel racing during calendar year 2005, or their respective assigns; provided, however, that the two dog racing meeting licensees in Bristol County shall be deemed one for all purposes of this act; and, further, excluding any licensees of racing meetings held or conducted in connection with a state or county fair.

(y) "Substantial party in interest," any person holding a greater that one percent (1 %) direct or indirect pecuniary interest, whether as owner, mortgagee or otherwise, in an operating entity, premises, or any other licensee or applicant;

(z) "Work permit," any permit issued by the commission authorizing the holder to be employed as an employee in a licensed gaming establishment.

Section 3. Gaming Control Commission; Composition, Powers & Duties.

(a) There shall be established a Massachusetts gaming control commission consisting of five members. Each member shall be a citizen of the United States and a resident of the commonwealth. No officer or official of any political party, nor any person who

was formerly a licensee or an unlicensed employee of a gaming licensee within the five years prior to any appointment shall be eligible for appointment to the commission. No person actively engaging or having a direct pecuniary interest in gaming activities shall be a member of the Commission. Not more than three members of the Commission shall be of the same major political party affiliation. The governor shall appoint two members of the Commission and designate one member to serve as chairman of the Commission. The attorney general of the commonwealth shall appoint one member of the Commission. The auditor of the commonwealth shall appoint one member of the Commission. The

Secretary of State shall appoint one member of the Commission.(b) The term of office of each member of the Commission shall be five years except that, of the members initially appointed, one shall be appointed by the governor for a term of five years, one shall be appointed by the attorney general for a term of four years, one shall be appointed by the governor for a term of three years,

one shall be appointed by the auditor for a term of two years, and one shall be appointed by the Secretary of State for a term of one year. After the initial term the term of office for each member of the Commission is five years, provided that no member shall serve more than two consecutive terms of five- year periods. Any vacancies shall be filled by the original appointing authority within sixty days of the occurrence of such vacancy. Any appointee shall continue in office beyond the expiration dateofhis term until the appointment of a successor but in no event longer than six months. Any Commissioner may be removed by his appointing authority for just cause, and shall be suspended, without pay, upon indictment for any felony. Any person so suspended shall be removed upon conviction. Any person so suspended and later acquitted of any such felony shall be reinstated to the commission upon such acquittal, with full back pay.

(c) The commission members shall devote that time and attention to the business of the commission as is necessary to discharge their duties; provided, however, the chairman shall devote his or her full time during normal business hours to the business of the commission. The members of the commission shall be compensated for work performed for the commission at ninety thousand

dollars per annum, with the chairman receiving ten thousand dollars per annum in additional compensation. Commission members shall be reimbursed for travel and other expenses necessarily incurred in the performance of official duties. Before entering upon the duties of the office each member shall swear that he is not peculiarly interested in, or doing business with, any person holding a gaming license and shall submit to his appointing authority and to the state ethics commission a statement of financial interest required by chapter two hundred sixty-eight B of the general laws.

(d) Except as otherwise provided herein, meetings of the commission shall be subject to the provisions of section eleven A and eleven A and one-half of chapter thirty A of the General Laws. A majority of the membership of the commission shall constitute a quorum of the commission. A public record of every vote shall be maintained at the commission's general office.

(e) The commission shall conduct hearings in accordance with the provisions of chapter thirty A, provided, however, that clause three of section eleven of chapter thirty A shall not apply. The commission may issue subpoenas for the attendance of witnesses or the production of any records, books, memoranda, documents, or other papers, or things, at or prior to any hearing as is necessary to enable the commission to discharge its duties, and may administer oaths or affirmations as necessary in connection therewith. The commission may petition the superior court for an

order requiring compliance with any subpoena at issue.

(f) The commission may retain legal, investigative, clerical and other assistance as may be necessary.

(g) The commission may require any person to apply for a license as provided in this chapter and approve or disapprove any such application or other transactions, events, and processes as provided in this chapter. Any application to receive any license under this chapter shall constitute a request for a determination of the applicant's general character, integrity, and ability to participate or engage in, or be associated with, gaming.

(h) The commission shall make an annual report of its activities to the general court by March 31, for the prior calendar year.

(i) The commission may grant or deny any application for a license or approval; may limit, condition, restrict, suspend, or revoke any license or approval for any cause deemed reasonable by commission, consistent with this chapter or any general or special law. The commission may, in its discretion, issue a probationary gaming license. No gaming license may be assigned either in whole or in part.

(g) As provided in commission regulations, the commission may impose a fine or penalty or interest on such fine or penalty, upon any gaming licensee, for violation of this chapter. The commission may approve or disapprove transactions, and events as provided in this chapter, take actions reasonably designed to ensure that no unsuitable persons are associated with controlled gaming, and take actions reasonably designed to ensure that

gaming activities take place only in suitable premises.

(k) The commission shall, pursuant to sections two and three of chapter thirty A of the general laws, promulgate regulations necessary to carry out the powers and the provisions of this chapter,

and specifically shall promulgate regulations as to the following matters:

(1) the licensing of gaming establishments, including regulations relating to the types of establishments, application process,

background checks, license fees, bonding requirements, and revocation and suspension of licenses;

(2) the licensing of gaming suppliers, including regulations relating to the application process, background checks, license fees, bonding requirements, and revocations and suspension of licenses;

(3) the licensing of parties in interest, including regulations relating to the application process, background checks, license fees, bonding requirements, and revocation and suspension of licenses;

(4) the issuance of one or more classes of work permits,

including regulations relating to the application process, background checks, fees, and revocation and suspension of work permits;

(5) the licensing of all officers and directors of any entity which holds or applies for a license under this chapter, including regulations relating to application process, background checks, licensee

fees, and revocation and suspension of licenses; and regulations requiring that, if in the judgment of the commission the public interest will be served by requiring any of the individual stockholders, key executives, agents or other employees of any entity which holds or applies for a license under this chapter to be licensed, such individuals apply for a license under this paragraph;

(6) the monitoring of licensees to ensure compliance with this chapter and the regulations promulgated thereunder;

(7) the presentation and/or display of all licenses and work permits; (8) the registration of non-gaming suppliers;

(9) the method for collecting any fines, fees, penalties and interest imposed by the commission;

(10) the method and standards of operation of licensed gaming establishments including, but not limited to, games, the type and manner of gaming, wagering limitations, odds, and hours of operation; provided, however, the commission shall not restrict the

number of hours of operation of any licensed gaming establishment to fewer hours than of any competing gaming facilities with controlled gaming;

(11) the manufacturing, distribution, sale, testing, servicing,

and inspection of gaming equipment, including requirements for the identification and licensing of same;

(12) any limitations on mortgage security interests and agreements relating to the property of licensed gaming establishments;

(13) any limitations on transfers of interests in licenses;

(14) advertising by licensed gaming establishments; provided, however, licensees shall have the right to conduct reasonable advertising consistent with that of competing gaming facilities;

(15) the manner in which winnings, compensation from games,

and gaming devices must be compiled and reported by licensees, provided, further, electronic gaming devices shall return as winnings a minimum of eighty-five percent of all sums wagered.

(16) standards for protection of the health, safety, and security of the public at licensed gaming establishments;

(17) the minimum procedures to be adopted by each licensed

gaming establishment to exercise effective supervisory and management control over its fiscal affairs, including the requirement of an annual audit undertaken in accordance with generally accepted accounting principles, and the requirement that quarterly reports be provided by licensed gaming establishments to the commission no more than 30 days after the close of each quarter;

(18) the persons to be excluded or ejected from licensed gaming establishments, including the type of conduct prohibited; and

(19) the distribution of funds for the treatment of compulsive behavior.

(I) ill emergencies, the commission may, without complying

with sections two or three of chapter thirty A of the general laws, summarily adopt, amend, or repeal any regulation, if, at the time, the commission makes a finding that such action is necessary for the preservation of the public peace, health, safety, morals, good order, or general welfare, together with a statement of the facts constituting the emergency; provided, however, all such emergency actions shall expire after ninety days.

(m) Each operating license shall be issued for an initial term of one year, and may be renewed at the discretion of the commission for a term not to exceed five years.

(n) Any failure of a licensee to comply with this chapter or any regulation of the commission or the bureau may, at the discretion of the commission, result in the immediate suspension or revocation of the license.

(o) A gaming establishment license issued pursuant to this

chapter must be posted by the licensee and kept posted at all times in a conspicuous place in the area where gaming is conducted in the establishment for which the license is issued until it is replaced by a succeeding license.

(p) Any person who has had his application for a license denied or revoked, or is otherwise not in compliance with any requirements hereunder, shall not retain his interest in the premises or any entity seeking or holding a license under this chapter beyond that period prescribed by the commission; and shall not accept more for his interest than he paid for it or the market value on the date of the denial or revocation of the license or occurrence of non-compliance (not including the prospective value of said license), whatever is higher.

(q) The voluntary surrender of a license by a licensee does not become effective until accepted in a manner to be provided in the regulations of the commission. The surrender of a license does not relieve the former licensee of any fees, penalties, fines, taxes or interest due.

(r) No person shall transfer a direct or indirect pecuniary

interest in a licensed operating entity or premises, or enter into an option contract or other agreement providing for such transfer in the future, without having notified the commission. No person shall transfer a greater than five percent (5%) direct or indirect pecuniary interest in a licensed operating entity or premises without the issuance by the commission to the transferee of an operating license or an affirmative statement that the transferee has met the operating license standards, as the commission may require.

(s) The commission shall monitor the conduct of all licensees

and other persons having a material involvement, directly or indirectly, with a licensee for the purpose of ensuring that licenses are not issued to, or held by, and there is no direct or indirect material involvement with a licensee by unqualified, disqualified, or unsuitable persons.

(t) No commission member or person employed by the commission shall solicit or accept employment from a licensee, or represent any person or party other that the commonwealth before or against the commission for a period of three years from the termination of his office or employment with the commission.

(u) The commission may investigate fraud, deceit, misrepresentation or violations by any licensee under this chapter, or the occurrence of any such activity involving any licensee. If the commission has reasonable basis to believe that any licensee has been or is engaged in criminal behavior or that criminal activity is occurring within or involving any licensed gaming establishment, the commission shall report same to the district attorney of the county within which the gaming establishment is located and make available to said district attorney all relevant information on such activity. The commission shall apply to the department of public safety for the assignment of a complement of police officers to the commission on a regular basis and said department

shall assign such complement to the commission. The commission shall assign such police officers to guard and protect the lives and safety of the public and property at any such gaming establishment, and to perform any such other duties, which may be required by said commission in order to maintain fair and honest gaming establishment. The police officers so assigned shall,

except in the case of an emergency, while on duty at any such establishment be subject to the operational authority of the commission; provided, however, that such assignment or reassignment

shall not in any way impair any rights to which any officer may be entitled. The commission shall from funds available pay to the department of public safety the cost of the salaries of the police officers so assigned from funds appropriated to the commission. All assignment and reassignments to the commission, except as the commissioner of public safety shall determine that an emergency exists or its threatened, shall be subject to the approval of the gaming control commission. Nothing herein shall prevent licensees from applying to the state police if they have jurisdiction in the area where gaming establishment is located, or to the police department of a city or town wherein the gaming establishment is located, in order that such police agency may furnish a police detail for safety or traffic purposes at any gaming establishment authorized by this chapter. The total cost for any such police detail shall be a sum equal to the salaries of the police officers comprising such detail, plus a sum to cover the administrative expenses incurred by the department of each such police officer.

(v) The commission, as it deems appropriate, may ask a district attorney to file a civil lawsuit to restrain a. violation of this chapter or enforce any provision thereof. An action brought against a person pursuant to this chapter does not preclude any other criminal or civil proceeding as may be authorized by law.

(w) Any person aggrieved by a determination by the commission to issue, deny, modify, revoke or suspend any license or approval, or to issue any order under the provisions of this

chapter, may request an adjudicatory hearing before the commission under the provisions of chapter thirty A. Any such determination shall contain a notice of this right to request a hearing and

may specify a time limit, not to exceed twenty-one days, within which said person shall request said hearing. If no such request is timely made, the determination shall be deemed assented to. If a timely request is received, the commission shall within a reasonable time act upon a request in accordance with the provisions of chapter thirty A. A person aggrieved by a final decision in an adjudicatory hearing held under the provisions of this section may obtain judicial review thereof pursuant to the provisions of chapter thirty A.

Section 4. State Gaming Control Bureau; Composition, Powers & Duties.

(a) There shall be established a state gaming control bureau

within the executive office of administration and finance.

(b) The secretary of administration and finance shall appoint the executive director of the bureau for a term of five years. The executive director shall not serve more than two consecutive

terms. The executive director shall employ such professional, technical, and clerical assistants and employees as necessary, subject to appropriation; provided, however, such assistants and

employees shall not be subject to G.L. c. 31 or G.L. c. 30, § 9(A).

The department of public safety and division of state police shall assign to the Division such full and adequate numbers of investigators as the executive director shall reasonably require to carry

out the purposes of this chapter.

(c) The powers and duties of the bureau shall include, but not be limited to, the following:

(1) To visit, investigate, and place accountants, technicians,

and any other personnel, without prior notice or approval of any party as it may deem necessary, in the office, gaming area, or other place of business of any licensee under this chapter;

(2) To require that the books and financial or other records or statements of any licensee be kept in a manner that the commission or the bureau deems proper;

(3) To visit, inspect, and examine without prior notice or approval of any party, all premises where gaming equipment is manufactured, sold or distributed;

(4) To inspect and test without prior notice or approval of any party, all equipment and supplies in any licensed gaming establishment or in any premises where gaming equipment is manufactured, sold or distributed;

(5) To have access to, and inspect, examine, photocopy, and

audit all relevant and material papers, books, and records of an applicant for, or person holding, a license for a gaming establishment under this chapter, on such applicant's or licensee's premises

or elsewhere, as practicable, in the presence of the applicant or licensee or his or her agent, and require verification of income, and all other matters affecting the enforcement of this chapter;

(6) To have access to and inspect, examine, photocopy, and audit all relevant and material papers, books, and records of any affiliate of a licensed gaming establishment that the bureau knows or reasonably suspects is involved in the financing, operation, or management of any entity licensed pursuant to this chapter, either on the affiliate's premises or elsewhere, as practicable, in the presence of the affiliate or any agent thereof; and,

(7) To refer any suspected criminal violation of this chapter; provided, however, that nothing in this section shall be deemed to limit the investigatory and prosecutorial powers of other state and local officials and agencies;

(d) The bureau shall investigate the qualifications of each applicant under this chapter and make a recommendation to the commission before any license is issued. The bureau shall also continue to monitor the conduct of all licensees and other persons having a material involvement, directly or indirectly, with a licensee for the purpose of ensuring that licenses are not issued to, or held by, and there is no direct or indirect material involvement with a licensee by unqualified, disqualified, or unsuitable persons, or persons whose operations are conducted in unsuitable manner or in unsuitable or prohibited places, as provided in commission or bureau regulations.

(e) The bureau may recommend to the commission the denial of any application, the limitation, conditioning, restriction, sus-pension, or revocation of any license or approval, or the imposition of any fine or penalty upon any licensee.

(f) The bureau shall maintain a file of applications for licenses under this chapter, together with a record of all action taken by the commission on those applications. Such applications shall be open to public inspection. The bureau may maintain any other files and records as it deems appropriate.

(g) Each employee of the bureau shall file with the executive director and the state ethics commission a statement of financial interest as defined in chapter two-hundred sixty-eight B. Such statement shall be under oath and shall be filed at the time of employment and annually thereafter, as .required by the state ethics commission.

(h) No employee of the bureau shall be permitted to place a wager in any establishment licensed by the commission except in the course of his duties.

(i) No person employed by the bureau shall solicit or accept employment from a licensee, or represent any person or party other than the commonwealth before or against the bureau or the commission, for a period of three years from the termination of his office or employment with the bureau.

(g) The bureau may investigate, fraud, deceit, misrepresentation or violations of this chapter by any person licensed hereunder or the occurrence of any such activity within or involving any licensed gaming establishment. If the bureau has reasonable basis to believe that any licensee has been or is engaged in criminal behavior or that criminal activity is occurring within or involving any licensed gaming establishment, the bureau shall report same to the district attorney of the county within which the licensed gaming establishment is located and make available to said district attorney all relevant information on such activity.

(k) The bureau, as it deems appropriate, may ask said district attorney to file a civil lawsuit to retrain a violation of this chapter or enforce any provision thereof. An action brought against a person pursuant to this chapter shall not preclude any other criminal or civil proceeding as may be authorized by law.

(l) The bureau shall make a continuous study and investigation

of gaming throughout the commonwealth in order to ascertain the adequacy and effectiveness of state gaming law or regulations and may formulate recommendations for changes in such laws and regulations. The bureau shall make a continuous study and investigation of the operation and administration of similar laws in other states or countries, of any literature or reports on the subject, of any federal laws which may affect the operation of gaming in the commonwealth, al with a view to recommending or effecting changes that will tend to better serve an implement the purposes of this chapter.

(m) The executive director of the bureau may recommend that the commission initiate proceedings or actions appropriate to enforce this chapter and the regulations promulgated thereunder.

Section 5. Licensing of Licensed operators; payment of Commissions.

(a) Notwithstanding the provisions of G.L. c. 137, G.L. c. 271, or any other general or special law to the contrary, each racing meeting licensee is eligible to be licensed, subject to all terms and conditions imposed by the Commission, to operate a gaming establishment; and shall have the right to operate one thousand five hundred (1,500) electronic gaming devices.  Said licensees shall pay weekly to the commission on behalf of the commonwealth, a sum equal to 55 percent of net gaming revenues and from which the commission shall allocate percentages to be paid to the city or town in which the establishment is located and to configure cities and towns, except those contiguous to the city of Boston a minimum of 2 per cent and a minimum ½ of 1 percent the treatment of compulsive and problem gamblers.  The reminder of the adjusted net gaming revenue shall go to local and similar to lottery distribution. The remaining sums shall be retained by each licensee as its commissions and, provided, further, that each such licensee shall in addition pay all taxes otherwise due and payable.

(b) No person shall operate a gaming establishment without having obtained all necessary operating licenses from the commission. There shall be a single licensed operator for each gaming establishment. The licensing standards must be met at all times by each officer, director, partner, and trustee of the operating entity, by each substantial party in interest of the operating entity

or of the premises on which such establishment is located, and by such other party in interest of the operating entity, the premises, or any holding company or intermediary company of the operating entity or the premises as the commission may require.

(c) A person may apply to be a licensed operator by filing an application with the commission, the form and any accompanying application fees as the commission may establish. Information on the application will be used as the basis for a thorough background investigation which the bureau shall conduct with respect to each applicant. Each application shall disclose the identity of each party in interest, each holding company and intermediary company, and each affiliate of the operating entity. The application shall disclose, in the case of the privately held corporation,

the names and addresses of all directors, officers, and stockholders; in the case of a publicly traded corporation, the names and addresses of all directors, officers, and persons holding at least five percent of the total capital stock issued and outstanding; in the case of a limited liability company, the names and addresses of all members of the management committee and all persons holding at least five percent of the membership interests; in the case of a partnership, the names and addresses of al partners, both general and limited; and in the case of a trust, the names and addresses of all trustees and beneficiaries.

(d) Each operating entity shall identify, in its application, the premises containing the establishment where it proposes to conduct its gaming operations. The application shall contain such information regarding the physical location and condition of the premises and the potential impact of the proposed gaming operations upon adjacent properties and the municipality and region within which the premises are located, as the commission may require. The application shall disclose the identity of all parties in interest regarding the premises; and except as otherwise permitted herein, no person other than a gaming establishment licensee here- under shall have any right to or interest in any gaming revenue derived from electronic gaming devices in the form of a percentage of such sums or require more than fair market value for rent, leases or services.

(e) No licensed operator shall obtain any gaming equipment

from a person who does not hold a license. No licensed operator shall enter into any agreement for the receipt of goods or services, of any form and in any amount, from a person who does not hold a license, when a license is required for such agreement under this act or under regulations promulgated by the commission or bureau.

(f) No licensed operator shall employ any person in a gaming establishment who does not hold a work permit, when a work permit is required for such position under regulations promulgated by the commission or bureau.

Section 6. Records of Commission and Bureau Proceedings. (a) The commission shall cause to be made and kept a record of all proceedings at all meetings of the commission. These records shall be open to public inspection.

(b) Notwithstanding any other general or special law to the contrary all files, records, reports, and other information in the possession of any state or local governmental agency including

tax filings and related information that are relevant to an investigation by the bureau conducted pursuant to this chapter shall be made available by such agency to the commission or bureau as requested. However, any tax or financial information received from a governmental agency shall be used solely for effectuating the purposes of this chapter. To the extent that these files,

records, reports, or information are confidential or otherwise privileged from disclosure under any law, they shall not lose that confidential or privileged status for having been disclosed to the

commission or bureau.

(c) The attorney general, every district attorney, and every state and local law enforcement agency shall notify the commission of any investigation or prosecution of any person if it appears

that a violation of any law related to gaming has occurred.

Section 7. Criminal Acts and Penalties; Age Restrictions.

(a) No official, member, employee, or agent of the commission or bureau, having obtained access to confidential records or information in the performance of duties pursuant to this chapter,

unless otherwise provided by law, shall knowingly disclose or furnish the records or information, or any part thereof, to any person who is not authorized by law to receive it. Violation of this provision shall be punishable by a fine of not more than ten thousand dollars or by imprisonment in the house of correction for not more than one year, or by both such fine and imprisonment.

(b) No person shall operate, carryon or conduct any controlled game or operate a gaming operation except subject to a license issued by the commission as provided in this chapter.

(c) Any person included on the list of persons to be excluded or ejected from a licensed gaming establishment pursuant to regulations promulgated pursuant to this chapter who knowingly

enters or remains on the premises of a licensed gaming establishment shall be punished by imprisonment in the house of correction for not more than one year, or by a fine of not more than ten thousand dollars, or by both such imprisonment and fine.

(d) Any person under the age of twenty-one years who plays, places wagers at, or collects winnings from, whether personally or through an agent, any controlled game, or who is employed as an employee in a licensed gaming establishment shall be punished by imprisonment in the house of correction for not more than one year, or by a fine of not more than one thousand dollars, or by both such imprisonment and fine. Any licensee, or other person, who knowingly allows a person under the age of twenty-one to play, place wagers at or collect winnings, whether personally or through an agent, shall be punished by imprisonment in the house of correction for a term of not more than one year or pay a fine of not more than ten thousand dollars, or by both such imprisonment and fine. A subsequent violation of this section shall subject the licensee to imprisonment in the house of correction for not more than two years or pay a fine of not more than twenty-five thousand dollars or by both such imprisonment and fine.

(e) Any person who willfully fails to report, pay, or truthfully account for and pay over any fee, penalty, fine, or interest thereon, imposed by this chapter or any regulation thereunder, or willfully attempts in any manner to evade or defeat any fee, penalty, fine, or interest thereon, or payment thereof shall be punished by imprisonment in state prison for not more than five years or by imprisonment in the house of correction for not more than two and one-half years, or by a fine of not more than ten thousand dollars, or by both such imprisonment and fine ..

(f) Any person who willfully resists, prevents, impedes, interferes with, or makes any false, fictitious or fraudulent statement, or representation to the commission or the bureau of any of their agents or employees in the performance of duties pursuant to this chapter, shall be punished by imprisonment in the house of correction for not more than two years, or by a fine not more than five thousand dollars, or by both such imprisonment and fine.

(g) Any person, as owner, lessee, or employee, whether for

hire or not, either solely or in conjunction with others, who knowingly shall do any of the following without having first procured and thereafter maintained in effect all licenses required by law:

(1) To deal, operate, carry on, conduct, maintain, or expose for play in this state any controlled game or gaming equipment used in connection with any controlled game;

(2) To receive, directly or indirectly, any compensation or reward or any percentage or share of the revenue, for keeping, running, or carrying on any controlled game, or owning the real property or location in which any controlled game occurs;

(3) To manufacture or distribute within the territorial boundaries of the commonwealth any gaming equipment to be used in connection with controlled gaming; shall be punished by imprisonment in the house of correction for not more than two and one-half years, or by a fine of not more than ten thousand dollars, or by both such imprisonment and fine.

(h) Any person who knowingly permits any controlled game to be conducted, operated, dealt, or carried on in any house or building or other premises that he or she owns or leases, in whole or in part, if that activity is undertaken by a person who is not licensed as required by this chapter shall be punished by imprisonment in state prison in the house of correction for not more than

two and one-half years, or by a fine of not more than ten thousand dollars, or by both such imprisonment and fine.

(i) Any former commissioner or commission or bureau employee who, within three years after his state employment has ceased, solicits or accepts employment with or provides consultant services to any licensee or at any licensed gaming establishment shall be punished by a fine of not more than five thousand dollars or by imprisonment for not more than two and one-half

years in the house of correction or by both such fine and imprisonment. Any licensee who knowingly employs a former commissioner or commission or bureau employee in violation of this

subsection shall be subject to immediate revocation of his or her license.

(g) It is unlawful for any person:

(1) to alter or misrepresent the outcome of a game or other

event on which wagers have been made after the outcome is determined but before it is revealed to the players;

(2) knowingly to entice or induce another to go to any place where gaming is being conducted or operated in violation of the provisions of this chapter, with the intent that the other person play or participate in that gaming;

(3) to manipulate, with the intent to cheat, any component of a gaming device in a manner contrary to the designed and normal operational purpose for the component including, but not limited to, varying the pull of the handle of a slot machine, with knowledge that the manipulation affects or reasonably may tend to affect the outcome of the game or with knowledge of any event that affects the outcome of the game; As used in this section, "cheat" means to alter the selection of criteria which determine:

(a) the results of a game; or

(b) the amount or frequency of payment in a game.

(4) to have on his person or in his possession on or off the premises of any licensed gaming establishment any key or device known to have been designed for the purpose of and suitable for opening, entering or affecting the operation of any gaming or equipment, or for removing money or other contents therefrom, except where such person is a duly authorized employee of a licensee acting in furtherance of his employment within a licensed gaming establishment.

A violation of this section shall be punishable by imprisonment in the house of correction for not more than two years or by a fine of not more than four thousand dollars, or by both such imprisonment and fine.

(k) A violation of this chapter, the penalty for which is not specifically fixed in this section, shall be punishable by imprisonment in the house of correction for not more than two years, or by

fine of not more than five thousand dollars, or by both such imprisonment and fine.

(1) The conviction of a licensee for violation of, an attempt to violate, or conspiracy to violate any provision of this chapter or any regulation thereunder may result in the immediate revocation of all licenses issued to the violator under this chapter; and, in addition, the court, upon application of the bureau or of the commission, may order that no new or additional license under this

chapter be issued to the violator, or be issued to any person who owned the room or premises in which the violation occurred, for one year after the date of revocation.

Section 8. Revenues.

(a) There is hereby established a gaming investigative account. Any and all reasonable expenses associated with the licensing of any applicant shall be borne by the applicant or licensee. Pursuant to its regulations, the commission shall require each applicant to deposit with the commission, together with the application, an application fee which shall be deposited in the gaming investigative account. Such fee shall constitute the anticipated costs and charges incurred in the investigation and processing of the application, and any additional sums as are required by the commission and the bureau to pay [mal costs and charges. Expenses

may be advanced from the gaming investigative account by the commission to the bureau. Any money received from an applicant in excess of the costs and charges incurred in the investigation or the processing of the application shall be refunded pursuant to regulations adopted by the commission. At the conclusion of the investigation, the bureau shall provide the applicant a written accounting of the costs and charges so incurred.

Section 9. Disclosure requirements.

(a) Every licensed gaming establishment shall, upon receipt of criminal or civil process compelling testimony or production of documents in connection with any civil or criminal investigation, immediately disclose such information to the bureau.

(b) All licensees shall have a duty to inform the commission and bureau of any action which they reasonably believe would constitute a violation of this chapter, and shall assist the commission and bureau and any federal or state law enforcement agency in the investigation and prosecution of such violation. The commission shall hold a hearing under chapter 30A on any licensees' failure to comply with this paragraph, and may take appropriate actions including suspension or revocation of the license. No person who so informs the commission or the bureau shall be discriminated against by an applicant or licensee because of the supplying of such information.

Section 10. Compulsive Gambler Set Aside.

One-half of one percent of the net gaming revenues of each licensed gaming establishment paid to the commonwealth shall be deposited in the general fund, and subject to appropriation, shall be used for the treatment of compulsive and problem gamblers.

Section 11. Recovery of Gaming Debts by Patrons.

Whenever a licensed gaming establishment refuses payment of alleged winnings to a patron, the gaming establishment and the patron are unable to resolve the dispute to the satisfaction of the patron and the dispute involves:

(a) $500 or more, the gaming establishment shall immediately notify the bureau; or

(b) less than $500, the gaming establishment shall inform the

patron of his right to request that the bureau conduct an investigation. The bureau shall conduct whatever investigation it deems necessary and shall determine, in its sole discretion and without need

for a hearing, whether payment should be made. In the event the bureau determines that payment should be made, all costs of the investigation shall be borne by the gaming establishment. Failure of the establishment to notify the bureau or inform the patron as provided herein shall subject the establishment to disciplinary action.

Any party aggrieved by the determination of the bureau may

file a petition for reconsideration with the commission setting forth the basis of the request for reconsideration. Any hearing for reconsideration shall be conducted pursuant to regulations adopted by the commission.

SECTION 2. This act shall take effect upon its passage.