HLS 18RS-914 ENGROSSED
2018 Regular Session
HOUSE BILL NO. 583
BY REPRESENTATIVE JIMMY HARRIS
GAMBLING/CASINO: Provides with respect to the casino operating contract
1 AN ACT
2To amend and reenact R.S. 27:241(A), 241.1, 243(C), 247, and 270(A)(3), and Subpart P-1
3 of Part II-A of Chapter 1 of Subtitle I of Title 39 of the Louisiana Revised Statutes
4 of 1950, comprised of R.S. 39:100.81, relative to the land-based casino operating
5 contract; to provide relative to the duration of the primary contract term and the
6 duration of renewal terms; to authorize a renewal term of thirty years when certain
7 conditions are met; to provide relative to compensation paid to the Louisiana Gaming
8 Control Board; to provide for a specific amount to be paid to the Louisiana Gaming
9 Control Board and to provide for disposition and use of such monies; to provide for
10 the deposit of monies into certain special treasury funds; to provide with respect to
11 the Community Water Enrichment Fund; to provide relative to the contract and
12 payment for casino support services; to provide for a specific amount to be paid to
13 the governing authority for the parish where the official gaming establishment is
14 located for providing casino support services; to provide relative to the casino
15 gaming operator's authority to conduct and offer non-casino gaming activities and
16 operations; to provide for certain restrictions on certain non-casino gaming activities
17 including restaurants and hotels; to provide relative to a memorandum of
18 understanding and agreement between the casino gaming operator and the Greater
19 New Orleans Hotel and Lodging Association; to provide relative to a memorandum
20 of understanding and agreement between the casino gaming operator and the
21 Louisiana Restaurant Association; and to provide for related matters.
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1Be it enacted by the Legislature of Louisiana:
2 Section 1. R.S. 27:241(A), 241.1, 243(C), 247, and 270(A)(3) are hereby amended
3and reenacted to read as follows:
4 §241. Board to let contract to conduct casino gaming operations; bid specifications;
5 compensation of casino gaming operator; contract renewal
6 A.(1) Notwithstanding any provision of law to the contrary, the board of
7 directors shall publicly advertise, offer, and let, in accordance with the provisions of
8 this Chapter, a contract to conduct casino gaming operations at a single official
9 gaming establishment to be located upon the site of the Rivergate Convention Center
10 in Orleans Parish. The initial term of the contract and any option to extend or renew
11 the initial term of the contract may not exceed a total of twenty years primary term
12 and one ten-year renewal option except as provided in this Subsection. The contract
13 or renewal option to conduct casino operations shall not be subject to sale, alienation,
14 assignment, or transfer by the casino gaming operator except as provided for in this
15 Chapter.
16 (2) Notwithstanding any law to the contrary, upon a showing that additional
17 renewals of the casino operating contract will benefit the economy of the state,
18 encourage the continued growth of tourism, and promote the stability of casino
19 operations at the land-based casino, and subject to the approval of any change in
20 terms of the casino operating contract by the Joint Legislative Committee on the
21 Budget, the Louisiana Gaming Control Board may approve and enter into additional
22 thirty-year renewal terms of the casino operating contract, in addition to the initial
23 term and the ten-year renewal term, subject to compliance with the provisions of this
24 Chapter.
25 (3) The first thirty-year renewal term, extending the casino operating
26 contract to July of 2054, shall contain provisions that do all of the following:
27 (a) Require the casino gaming operator to pursue a capital investment on or
28 around the official gaming establishment of three hundred fifty million dollars
29 ($350,000,000).
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1 (b) As provided in R.S. 27:247, require the casino gaming operator to
2 annually pay directly to the governing authority of the parish where the official
3 gaming establishment is located a sum of money as set forth in R.S. 27:247 to
4 compensate the parish for the cost to the parish for providing support services
5 resulting from the operation of the official gaming establishment and activities
6 therein.
7 (c) As provided in R.S. 27:241.1(B), require the casino gaming operator to
8 annually pay to the Louisiana Gaming Control Board a sum of money as set forth in
9 R.S. 27:241.1(B), in addition to the existing obligation to remit to the Louisiana
10 Gaming Control Board any fees or compensation, including compensation paid to
11 the Louisiana Gaming Control Board pursuant to R.S. 27:241.1(A).
12 * * *
13 §241.1. Minimum compensation payments; effective March 31, 2001; payments
14 beginning August 1, 2018, and August 1, 2023
15 A. Notwithstanding the provisions of R.S. 27:241(C) or any other law to the
16 contrary, effective midnight March 31, 2001, the minimum compensation to be paid
17 by the casino operator to the Louisiana Gaming Control Board shall be the greater
18 of: (i) eighteen and one-half percent of gross revenues or (ii) fifty million dollars for
19 the casino fiscal year April 1, 2001 through March 31, 2002 and sixty million dollars
20 for each casino fiscal year thereafter, to be allocated as provided in Subsection B of
21 this Section and R.S. 27:270(A)(3)(b).
22 B.(1) In addition to any existing obligation to remit to the Louisiana Gaming
23 Control Board any fees or compensation, including compensation paid to the
24 Louisiana Gaming Control Board pursuant to the provisions of this Section,
25 beginning on August 1, 2018, and continuing throughout the term of the casino
26 operating contract, the casino gaming operator shall annually pay to the Louisiana
27 Gaming Control Board the sum of money set forth in Paragraph (2) of this
28 Subsection.
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1 (2)(a) Except as provided in Subparagraph (b) of this Paragraph, beginning
2 on August 1, 2018, the payment required by Paragraph (1) of this Subsection shall
3 be equal to three million four hundred thousand dollars ($3,400,000).
4 (b) Beginning on August 1, 2023, the amount set forth in Subparagraph (a)
5 of this Paragraph shall be adjusted by a rate that is the lesser of two percent or the
6 Consumer Price Index, United States city average for all urban customers (CPI-U),
7 as prepared by the United States Department of Labor, Bureau of Labor Statistics for
8 the five calendar years immediately preceding the adjustment, with adjustments
9 being made to this amount in the same manner every five years thereafter.
10 * * *
11 §243. Requirements for casino operating contract
12 * * *
13 C. As to Beginning August 1, 2018, the casino gaming operator is authorized
14 to conduct the following non-casino related activities at the official gaming
15 establishment or at another location subject to the requirements set forth in
16 Paragraphs (1), (2), and (3) of this Subsection:
17 (1) The casino gaming operator:
18 (a) May directly offer a single restaurant facility with table food within the
19 official gaming establishment, provided that the seating does not exceed one hundred
20 fifty seats.
21 (b) May directly offer limited cafeteria style food services for employees and
22 patrons provided that seating for patrons shall be limited to four hundred seats and
23 further that any such seating shall be used only for buffet seating.
24 (c) May directly cater events within the official gaming establishment
25 provided that such catering on the second floor of the facility shall be limited to
26 targeted persons identified in Subparagraph (g) of this Paragraph, and provided
27 further that the casino gaming operator shall permit persons contracting a catered
28 event the option of using outside caterers.
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1 (d) May lease space on the second floor of the official gaming establishment
2 to unaffiliated third parties that shall be permitted to operate no more than two
3 restaurants with seating for no more than three hundred fifty persons, in the
4 aggregate.
5 (e) May directly operate non-casino related businesses on the second floor
6 of the casino provided that, other than as provided in Subparagraph (c) of this
7 Paragraph, any food for such operation shall be purchased or catered by a third party
8 restaurateur or food preparer with purchases at fair market value.
9 (f) May lease space to third parties that may operate non-casino related
10 businesses on the second floor of the official gaming establishment provided that the
11 primary purpose of such business is not a restaurant which shall require that no more
12 than thirty-five percent of the revenues of such business shall be derived from the
13 sale of food.
14 (g) May not offer or advertise complimentary or discounted food offerings
15 to the general public within a fifty-mile radius of the official gaming establishment
16 and within Louisiana, but may, nonetheless, offer and advertise complimentary or
17 discounted food offerings to: (i) a patron that is a member of a customer reward
18 system or otherwise maintained on a data base; (ii) a known "high roller" or patrons
19 on a junket with established play at the casino or with other casinos; (iii) a person
20 that, based upon observed win or loss levels, is eligible to obtain discounted or full
21 complimentary food offerings; (iv) a targeted prospective customer outside a fifty-
22 mile radius of the official gaming establishment or not within the state, provided that
23 no advertising of complimentary or discounted food offerings for such persons shall
24 be disseminated to the general public such as on billboards or in the print media; (v)
25 a person that has suffered a service error that results in complimentary or discounted
26 food offerings to rectify the error in service; or (vi) a vendor or other person visiting
27 the official gaming establishment for business or educational purposes. In no event
28 shall the casino gaming operator prospect for new customers in this state and within
29 a fifty-mile radius of the official gaming establishment through use of
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1 complimentary or discounted food offerings disseminated through any advertising
2 media whether newspaper, television, direct mail, coupons, or billboards.
3 (h) May lease space to area restaurant owners and food preparers who may
4 offer to provide for food service in a kiosk area, in the official gaming establishment
5 provided that all seating for any kiosk area or areas shall be limited to an aggregate
6 of one hundred seats which shall be used only for kiosk seating.
7 (i) May may have a meeting space for parties, VIP events, and the like but
8 shall not rent business meeting space for business seminars and training associated
9 with the sale or purchase of rentable units, unless such rentable units are rented at the
10 rates established as provided in Subparagraph (C)(2)(b).
11 (2) The casino gaming operator, on its own or through an affiliate, shall not
12 provide lodging, except that the casino gaming operator may own or operate offsite
13 lodging, which may be physically connected to the official gaming establishment,
14 subject to the following conditions: at or in the vicinity of the official gaming
15 establishment consistent with the following conditions and any agreement between
16 the casino gaming operator and the Greater New Orleans Hotel and Lodging
17 Association and its predecessors, as such agreement may be amended from time to
18 time:
19 (a) There shall be no more than four hundred fifty rentable units, and not
20 more than fifteen thousand square feet of meeting space if a hotel is newly
21 constructed or twenty thousand square feet if an existing hotel is purchased or leased
22 that contains such space, from April 1, 2001 to March 31, 2005, provided that after
23 March 31, 2005, additional rentable units may be owned or operated with additional
24 meeting space, only in accordance with any agreement for such increases entered
25 into by and between the casino gaming operator and the Greater New Orleans Hotel-
26 Motel Association and its successors, as such agreement may be amended from time
27 to time.
28 (b) Except as provided in Subparagraph (c) of this Paragraph and Paragraph
29 (3)(a) of this Subsection, the casino gaming operator shall not advertise room rates
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1 to the general public at below market rates. The casino gaming operator shall base
2 room rates on average seasonal rates for the preceding year of hotels located in the
3 Central Business District and French Quarter of the parish of the official gaming
4 establishment as compiled by a nationally recognized firm that compiles data on
5 room rates for such parish.
6 (c) The casino gaming operator shall not offer complimentary or discounted
7 hotel offerings to the general public, but may, nonetheless, offer complimentary or
8 discounted hotel offerings to: (i) a patron that is a member of the casino gaming
9 operator's or manager's customer reward system or otherwise maintained on the
10 casino gaming operator's or manager's data base; (ii) a known "high roller" or patrons
11 on a junket with established play at the official gaming establishment or with other
12 casinos; (iii) a person that, based upon observed win or loss levels at the casino, is
13 eligible to a discount or full complimentary offerings; (iv) a targeted prospect outside
14 a fifty-mile radius of the official gaming establishment, or not within the state; (v)
15 a person that has suffered a service error that results in a complimentary rate or
16 discount to rectify the error in service; or (vi) a vendor or other person visiting the
17 casino for business or educational purposes.
18 (d) The casino gaming operator shall not advertise to the general public,
19 which does not include those individuals specified in Items (c)(i) through (vi) of this
20 Paragraph, complimentary or discounted hotel rates; however, the casino gaming
21 operator may advertise rooms rented at the rates established in Subparagraph (b) of
22 this Paragraph on billboards outside a fifty-mile radius of the official gaming
23 establishment or on billboards outside of Louisiana. The casino gaming operator
24 may otherwise prospect for new customers through advertising media so long as the
25 pricing for rooms is consistent with the rate structure as set forth in Subparagraph (b)
26 of this Paragraph.
27 (e)(3)(a) The casino gaming operator is subject to the requirements of a
28 memorandum of understanding and agreement entered into with the Greater New
29 Orleans Hotel and Lodging Association dated March 2018, which may include an
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1 authorization to provide an agreed upon number of additional hotel rooms at a new
2 hotel site, and a memorandum of understanding and agreement entered into with the
3 Louisiana Restaurant Association dated March 2018. Any action related to the
4 enforcement of the memoranda of understanding and agreements shall be instituted
5 in the Civil District Court for the Parish of Orleans. The Louisiana Gaming Control
6 board shall retain jurisdiction over the casino gaming operator's compliance with the
7 provisions of this Chapter and any regulations or rules adopted by the Louisiana
8 Gaming Control Board.
9 (b) Among other things, the memorandum of understanding and agreement
10 with the Greater New Orleans Hotel and Lodging Association dated March 2018,
11 shall provide for the following:
12 (i) Only for those additional rooms authorized by the memorandum of
13 understanding and agreement dated March 2018, advertising of market rates shall be
14 based on average seasonal rates for the preceding year of luxury hotels in the Central
15 Business District, French Quarter, and Warehouse District of the City of New
16 Orleans, as compiled by a nationally recognized firm.
17 (ii) For rooms existing prior to August 1, 2018, Room room taxes shall be
18 paid by the casino gaming operator on all discounted and complimentary rooms to
19 be paid at the applicable tax rates based upon average seasonal rates for the
20 preceding year of hotels in the Central Business District, and French Quarter of the
21 parish of the official gaming establishment City of New Orleans, as compiled by a
22 nationally recognized firm. Only for those additional hotel rooms authorized by the
23 memorandum of understanding and agreement dated March 2018, room taxes shall
24 be paid by the casino gaming operator on all discounted and complimentary rooms
25 to be paid at the applicable tax rates based upon average seasonal rates for the
26 preceding year of luxury hotels in the Central Business District, French Quarter, and
27 Warehouse District of the City of New Orleans, as compiled by a nationally
28 recognized firm.
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1 (3)(4) The casino gaming operator shall not engage in such activities as are
2 prohibited by the casino operating contract.
3 * * *
4 §247. Casino support services contract; Casino Support Services Fund
5 A. Subject to and in accordance with the provisions of this Chapter, the
6 gaming control board shall enter into a casino support services contract with the
7 governing authority of the parish where the official gaming establishment is located
8 in order to compensate the parish for the cost to the parish for providing support
9 services resulting from the operation of the official gaming establishment and the
10 activities therein. Support services as used in this Section shall include but not be
11 limited to fire, police, sanitation, health, transportation, and traffic services. The
12 amount of the contract shall be determined by negotiation and agreement between
13 the gaming control board and the parish, subject to approval by the Joint Legislative
14 Committee on the Budget. In the event that a new contract is not agreed upon by the
15 gaming control board and the parish by March thirty-first of any year, the contract
16 currently in effect shall be submitted to the Joint Legislative Committee on the
17 Budget for approval of the amount of the contract at the next meeting of the
18 committee. If the committee approves the amount of the contract the chairman shall
19 notify the treasurer of the amount of the contract and, the contract shall remain in full
20 force and effect. If the committee disapproves or does not act upon the amount of
21 the contract, the contract shall be null, void, and of no effect and the treasurer shall
22 be prohibited from depositing monies into the Casino Support Services Fund.
23 B.(1) There is hereby created in the state treasury, as a special fund, the
24 Casino Support Services Fund, hereinafter referred to as the "fund", to provide
25 compensation to the parish governing authority pursuant to a casino support services
26 contract executed pursuant to Subsection A of this Section.
27 (2) Monies in the fund shall be invested in the same manner as monies in the
28 general fund. Interest earned on investment of monies in the fund shall be credited
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1 to the fund. Unexpended and unencumbered monies in the fund at the end of the
2 fiscal year shall remain in the fund.
3 C. Monies in the fund shall be appropriated to the parish governing authority
4 and used to compensate the parish for its costs for providing support services
5 resulting from the operation of the official gaming establishment and the activities
6 therein.
7 A. Beginning on August 1, 2018, and continuing throughout the term of the
8 casino operating contract, the casino gaming operator shall annually pay directly to
9 the governing authority of the parish where the official gaming establishment is
10 located, the sum of money set forth in Subsection B of this Section to compensate
11 the parish for the cost to the parish for providing support services resulting from the
12 operation of the official gaming establishment and activities therein.
13 B.(1) Except as provided in Paragraph (2) of this Subsection, beginning on
14 August 1, 2018, the annual payment required by Subsection A of this Section shall
15 be equal to three million six hundred thousand dollars ($3,600,000), payable in
16 quarterly installments.
17 (2) Beginning on August 1, 2023, the amount set forth in Paragraph (1) of
18 this Subsection shall be adjusted by a rate that is the lesser of two percent or the
19 Consumer Price Index, United States city average for all urban customers (CPI-U),
20 as prepared by the United States Department of Labor, Bureau of Labor Statistics for
21 the five calendar years immediately preceding the adjustment, with adjustments
22 being made to this amount in the same manner every five years thereafter.
23 * * *
24 §270. Deposit of revenues; expenditures and investments authorized; transfer of
25 revenues to state treasury; corporation operating account; audit of
26 corporation books and records; audits
27 A.
28 * * *
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1 (3)(a) Daily, the corporation shall transfer to the state treasury for deposit
2 into certain funds in the treasury, as provided in this Paragraph, the amount of net
3 revenues which the corporation determines are surplus to its needs. After first being
4 credited to the Bond Security and Redemption Fund in accordance with Article VII,
5 Section 9(B) of the Constitution of Louisiana, and after satisfying any other
6 requirements of the Constitution and laws of Louisiana, such net revenues shall be
7 allocated and deposited as follows:
8 (i) In each year for which the Joint Legislative Committee on the Budget
9 disapproves or does not act upon the amount of the casino support services contract
10 as provided in R.S. 27:247 and no monies are deposited in and credited to the Casino
11 Support Services Fund: provided in Subparagraph (b) of this Paragraph.
12 (b)(i) Beginning August 1, 2018, up to sixty million dollars per fiscal year
13 shall be allocated as follows:
14 (aa) Ten percent shall be deposited in and credited to the Support Education
15 in Louisiana First Fund as provided in R.S. 17:421.7 and shall be used solely and
16 exclusively for the same purposes provided for in Paragraph (B)(1) of that Section.
17 (bb) Ninety percent shall be deposited in and credited to the Support
18 Education in Louisiana First Fund as provided in R.S. 17:421.7.
19 (ii) In each year for which the Joint Legislative Committee on the Budget
20 approves the amount of the casino support services contract as provided in R.S.
21 27:247:
22 (aa) The first one million eight hundred thousand dollars shall be deposited
23 in and credited to the Casino Support Services Fund.
24 (bb) The next sixty million dollars shall be deposited in and credited to the
25 Support Education in Louisiana First Fund as provided in R.S. 17:421.7.
26 (cc) After satisfying the requirements of Subitems (aa) and (bb) of this Item,
27 monies shall be deposited into the Casino Support Services Fund until the casino
28 support services contract is fully funded for that year.
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1 (dd) After satisfying the requirements of Subitem (cc) of this Item, the
2 remainder of the monies shall be deposited in and credited to the Support Education
3 in Louisiana First Fund as provided for in R.S. 17:421.7.
4 (ii) Beginning August 1, 2018, after satisfaction of the requirements of Item
5 (i) of this Subparagraph, all residual monies shall be allocated in the following order:
6 (aa) Three million six hundred thousand dollars shall be deposited in and
7 credited to the Louisiana Early Childhood Education Fund established under R.S.
8 17:407.30.
9 (bb) Of the monies remaining after satisfaction of the requirements of
10 Subitem (aa) of this Item, fifty percent shall be distributed by the state treasurer to
11 the governing authority of the parish in which the official gaming establishment is
12 located for use in support of capital infrastructure projects, and fifty percent shall be
13 deposited in and credited to the Community Water Enrichment and Other
14 Improvements Fund established under R.S. 39:100.81.
15 (b)(c) Net revenues or proceeds shall be determined by deducting from gross
16 corporation revenues the necessary expenses incurred by the corporation in the
17 operation and administration of the casino gaming operations. This shall include the
18 expenses of the corporation, the expenses resulting from any contract or contracts
19 entered into for ordinary and customary business services rendered to the
20 corporation, and the amount required to be transferred to the state treasury pursuant
21 to Paragraph (2) of this Subsection.
22 * * *
23 Section 2. Subpart P-1 of Part II-A of Chapter 1 of Subtitle I of Title 39 of the
24Louisiana Revised Statutes of 1950, comprised of R.S. 39:100.81, is hereby amended and
25reenacted to read as follows:
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1 SUBPART P-1. COMMUNITY WATER ENRICHMENT
2 AND OTHER IMPROVEMENTS FUND
3 §100.81. Community Water Enrichment and Other Improvements Fund
4 A. There is hereby created in the state treasury, as a special fund, the
5 Community Water Enrichment and Other Improvements Fund, hereinafter referred
6 to as the "fund". The fund shall consist of two accounts: the Water System
7 Enrichment Account and the Other Improvements Account. Subject to appropriation
8 by the legislature, monies in the fund Water System Enrichment Account shall be
9 used solely to fund rehabilitation, improvement, and construction projects for
10 community water systems to provide drinking water to Louisiana's small rural
11 communities. Subject to appropriation by the legislature monies in the Other
12 Improvements Account shall be used by the office of community development solely
13 to provide for a grants program for local governments to assist with capital,
14 infrastructure, and other projects.
15 B. The fund shall consist of monies deposited annually pursuant to R.S.
16 27:270(A)(3)(b)(ii)(bb), with fifty percent to be deposited in and credited to the
17 Water System Enrichment Account and fifty percent to be deposited in and credited
18 to the Other Improvements Account. Further, the fund shall also consist of any other
19 monies appropriated, allocated, or transferred to the fund. Monies in the fund shall
20 be invested in the same manner as monies in the state general fund. Interest earned
21 on investment of monies in the fund shall be credited to the fund. Unexpended and
22 unencumbered monies in the fund at the end of the fiscal year shall remain in the
23 fund.
24 Section 3. On the effective date of this Act, the state treasurer shall transfer all
25monies in the Community Water Enrichment Fund at the close of the prior business day for
26a one-time deposit and credit to the Water System Enrichment Account within the
27Community Water Enrichment and Other Improvements Fund.
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DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 583 Engrossed 2018 Regular Session Jimmy Harris
Abstract: Provides relative to the casino operating contract for the official gaming
establishment located in Orleans Parish and the renewal of such contract.
The present law Louisiana Economic Development and Gaming Corporation Act provides
for the creation of the Louisiana Economic Development and Gaming Corporation, the
ownership interest of which is vested in the state, which is empowered to enter into contracts
for the conducting of casino gaming operations at a single official gaming establishment in
Orleans Parish. Pursuant to present law, effective May 1, 1996, the Louisiana Gaming
Control Board assumed control of the affairs of the Louisiana Economic Development and
Gaming Corporation and all powers, duties, functions, responsibilities, and obligations
associated therewith.
Under present law, the term of the contract and any option to extend or renew may not
exceed a total of 20 years primary term and one ten-year renewal option.
Proposed law amends present law to authorize the Louisiana Gaming Control Board to enter
into additional 30-year renewal terms of the casino operating contract, in addition to the
initial 20-year term and the one ten-year renewal term, upon a showing that additional
renewals of the casino operating contract will benefit the economy of the state, encourage
the continued growth of tourism, and promote the stability of casino operations at the land-
based casino, and subject to the approval of any change in terms of the casino operating
contract by the Joint Legislative Committee on the Budget.
Proposed law requires the first 30-year renewal term which extends the casino operating
contract to July of 2054, to contain provisions that do all of the following:
(1)Require the casino gaming operator to pursue a capital investment on or around the
official gaming establishment of $350,000,000.
(2) Require the casino gaming operator to annually pay directly to the governing
authority of the parish where the official gaming establishment is located a sum of
money, set forth in the provisions of proposed law, to compensate the parish for the
cost to the parish for providing support services resulting from the operation of the
official gaming establishment and activities therein.
In this regard, present law requires the La. Gaming Control Board to enter into a
contract for casino support services (including but not limited to fire, police,
sanitation, health, transportation, and traffic services) with the governing authority
of the parish where the official gaming establishment is located in order to
compensate the parish for the cost to the parish for providing support services
resulting from the operation of the official gaming establishment and the activities
therein. The amount of the contract is determined by negotiation and agreement
between the La. Gaming Control Board and the parish, subject to approval by the
Joint Legislative Committee on the Budget, and is paid from the Casino Support
Services Fund, specifically created for this purpose.
Proposed law amends present law to repeal the procedure by which the La. Gaming
Control Board pays the governing authority according to the negotiated casino
support services contract, and instead provides that beginning on Aug. 1, 2018, the
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casino gaming operator shall annually pay the governing authority directly to
compensate the parish for providing support services. Beginning Aug. 1, 2018, the
annual payment, payable in quarterly installments, shall be equal to $3,600,000.
Beginning on Aug. 1, 2023, this amount shall be adjusted by a rate that is the lesser
of two percent or the Consumer Price Index, United States city average for all urban
customers (CPI-U), as prepared by the United States Department of Labor, Bureau
of Labor Statistics for the five calendar years immediately preceding the adjustment,
with adjustments being made to this amount in the same manner every five years
thereafter.
(3)Require the casino gaming operator to annually pay to the Louisiana Gaming Control
Board a sum of money as set forth in the provisions of proposed law, in addition to
the existing present law obligations to remit to the Louisiana Gaming Control Board
any fees or compensation.
In this regard, present law provides that effective midnight Mar. 31, 2001, the
minimum compensation to be paid by the casino operator to the La. Gaming Control
Board shall be the greater of: (i) eighteen and one-half percent of gross revenues or
(ii) $50,000,000 for the casino fiscal year April 1, 2001 through March 31, 2002 and
$60,000,000 for each casino fiscal year thereafter.
Proposed law retains present law and provides that, beginning Aug. 1, 2018, in
addition to this existing obligation, the casino gaming operator shall annually pay to
the La. Gaming Control Board the sum of money equal to $3,400,000. Beginning
on Aug. 1, 2023, this amount shall be adjusted by a rate that is the lesser of two
percent or the Consumer Price Index, United States city average for all urban
customers (CPI-U), as prepared by the United States Department of Labor, Bureau
of Labor Statistics for the five calendar years immediately preceding the adjustment,
with adjustments being made to this amount in the same manner every five years
thereafter.
Present law authorizes the casino gaming operator to operate and conduct certain non-casino
gaming activities such as restaurants, cafeteria style food services, catering, special events,
and leasing of space at the establishment for certain specified purposes including but not
limited to business meetings for outside entities, special events, and parties. Present law
further provides certain restrictions on the casino gaming operator relative to such operations
and activities, including restrictions on pricing and advertising.
Present law authorizes the casino gaming operator to own or operate offsite lodging which
may be physically connected to the official gaming establishment subject to certain
conditions and restrictions on the number of rentable units, square footage, advertising, and
pricing.
Proposed law amends provisions of present law to provide that beginning Aug. 1, 2018, the
casino gaming operator is authorized to conduct certain non-casino related activities at the
official gaming establishment or at another location subject to certain requirements as
follows:
(1)The casino gaming operator may have a meeting space for parties, VIP events, and
the like but shall not rent business meeting space for business seminars and training
associated with the sale or purchase of rentable units, unless such rentable units are
rented at the rates based on average seasonal rates for the preceding year of hotels
located in the Central Business District and French Quarter of Orleans Parish as
compiled by a nationally recognized firm that compiles data on room rates for such
parish.
(2)The casino gaming operator, on its own or through an affiliate, shall not provide
lodging, except that the casino gaming operator may own or operate lodging at or in
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the vicinity of the official gaming establishment consistent with both of the
following:
(a)Certain conditions provided by proposed law relative to room rates,
complimentary and discounted hotel offerings, and advertising.
(b)Any agreement between the casino gaming operator and the Greater New
Orleans Hotel and Lodging Association and its predecessors, as such
agreement may be amended from time to time.
(3)The casino gaming operator is subject to the requirements of a memorandum of
understanding (MOU) and agreement entered into with the Greater New Orleans
Hotel and Lodging Association dated March 2018, which may include an
authorization to provide an agreed upon number of additional hotel rooms at a new
hotel site, and a MOU and agreement entered into with the La. Restaurant
Association dated March 2018.
In this regard, proposed law provides:
(a)Any action related to the enforcement of the memoranda of understanding
and agreement shall be instituted in the Civil District Court for the Parish of
Orleans; and the La. Gaming Control board shall retain jurisdiction over the
casino gaming operator's compliance with the provisions of present and
proposed law and any regulations or rules adopted by the La. Gaming
Control Board.
(b)The memorandum of understanding and agreement with the Greater New
Orleans Hotel and Lodging Association dated March 2018, shall provide for
certain restrictions specified in proposed law, relative to advertising of
market rates and room taxes, that apply only to the additional rooms
authorized by the MOU and agreement.
Present law requires the corporation, on a daily basis, to transfer to the state treasury for
deposit into certain funds in the treasury the amount of net revenues which the corporation
determines are surplus to its needs. Further provides that such net revenues shall be
deposited as follows:
(1)In each year for which the Joint Legislative Committee on the Budget disapproves
or does not act upon the amount of the casino support services contract, no monies
are deposited in and credited to the Casino Support Services Fund:
(a)10% shall be deposited in and credited to the Support Education in
Louisiana First Fund and used solely and exclusively for specific purposes
provided in present law.
(b)90% shall be deposited in and credited to the Support Education in Louisiana
First Fund.
(2)In each year for which the Joint Legislative Committee on the Budget approves the
amount of the casino support services contract:
(a)The first $1,800,000 shall be deposited in and credited to the Casino Support
Services Fund.
(b)The next $60,000,000 shall be deposited in and credited to the Support
Education in Louisiana First Fund.
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(c)After satisfying the requirements of paragraphs (a) and (b) above, monies
shall be deposited into the Casino Support Services Fund until the casino
support services contract is fully funded for that year.
(d)After satisfying the requirements of paragraph (c) above, the remainder of the
monies shall be deposited in and credited to the Support Education in
Louisiana First Fund.
In this regard, proposed law amends present law to provide for the allocation and distribution
of such net revenues as follows:
(1)Beginning Aug. 1, 2018, up to $60,000,000 per fiscal year shall be allocated as
follows:
(a)10% shall be deposited in and credited to the Support Education in Louisiana
First Fund and used solely and exclusively for purposes provided in present
law.
(b)90% shall be deposited in and credited to the Support Education in Louisiana
First Fund.
(2)Beginning Aug. 1, 2018, after satisfaction of the requirements of paragraph (1)
above, all residual monies shall be allocated in the following order:
(a)$3,600,000 shall be deposited in and credited to the Louisiana Early
Childhood Education Fund.
(b)Of the monies remaining after satisfaction of the requirements of paragraph
(a) above, 50% shall be distributed by the state treasurer to the governing
authority of the parish in which the official gaming establishment is located
for use in support of capital infrastructure projects, and 50% shall be
deposited in and credited to the Community Water Enrichment and Other
Improvements Fund as the fund is amended by proposed law.
In this regard, proposed law changes the present law "Community Water
Enrichment Fund" to the "Community Water Enrichment and Other
Improvements Fund" to be comprised of two accounts, the Water System
Enrichment Account and the Other Improvements Account, with each
account receiving 50% of the monies deposited from the portion of the net
revenues allocated to the Community Water Enrichment and Other
Improvements Fund as provided by proposed law. Further provides that
monies in the Other Improvements Account shall be used by the office of
community development solely to provide for a grants program for local
governments to assist with capital, infrastructure, and other projects.
In this regard, proposed law requires the state treasurer, on the effective date
of proposed law, to transfer all monies in the Community Water Enrichment
Fund at the close of the prior business day for a one-time deposit and credit
to the Water System Enrichment Account as created by proposed law.
(Amends R.S. 27:241(A), 241.1, 243(C), 247, and 270(A)(3) and R.S. 39:100.81)
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HB NO. 583
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Administration of
Criminal Justice to the original bill:
1. Amend proposed law to provide that the memorandum of understanding between
the casino gaming operator and the Greater New Orleans Hotel and Lodging
Association dating March 2018 may include, instead of shall include, an
authorization to provide an agreed upon number of additional hotel rooms at a
new hotel site.
2. Specify that any action related to the enforcement of memoranda of
understanding and agreements shall be instituted in the Civil District Court for
the Parish of Orleans.
3. Add changes to provisions of present law which provides for the distribution of
certain net revenues into specific funds and which provides for the procedure by
which the amount allocated to each fund is determined.
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