| 1 | 1 | | 1.1 A bill for an act |
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| 2 | 2 | | 1.2 relating to the state lottery; modifying provisions relating to retailer contracts; |
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| 3 | 3 | | 1.3 amending Minnesota Statutes 2024, sections 349A.01, by adding a subdivision; |
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| 4 | 4 | | 1.4 349A.06, subdivisions 2, 11. |
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| 5 | 5 | | 1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: |
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| 6 | 6 | | 1.6 Section 1. Minnesota Statutes 2024, section 349A.01, is amended by adding a subdivision |
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| 7 | 7 | | 1.7to read: |
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| 8 | 8 | | 1.8 Subd. 13a.Responsible lottery official."Responsible lottery official" means the officers, |
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| 9 | 9 | | 1.9directors, or owners of an organization, firm, partnership, or corporation that have oversight |
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| 10 | 10 | | 1.10of lottery ticket sales. |
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| 11 | 11 | | 1.11 Sec. 2. Minnesota Statutes 2024, section 349A.06, subdivision 2, is amended to read: |
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| 12 | 12 | | 1.12 Subd. 2.Qualifications.(a) The director may not contract with a retailer sole proprietor |
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| 13 | 13 | | 1.13who: |
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| 14 | 14 | | 1.14 (1) is under the age of 18; |
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| 15 | 15 | | 1.15 (2) is in business solely as a seller of lottery tickets; |
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| 16 | 16 | | 1.16 (3) owes $500 or more in delinquent taxes as defined in section 270C.72; |
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| 17 | 17 | | 1.17 (4) has been convicted within the previous five years of a felony or gross misdemeanor, |
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| 18 | 18 | | 1.18any crime involving fraud or misrepresentation, or a gambling-related offense in any |
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| 19 | 19 | | 1.19jurisdiction in the United States; |
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| 20 | 20 | | 1.20 (5) is a member of the immediate family, residing in the same household, as the director |
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| 21 | 21 | | 1.21or any employee of the lottery; |
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| 22 | 22 | | 1Sec. 2. |
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| 23 | 23 | | 25-01999 as introduced02/18/25 REVISOR JSK/AD |
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| 24 | 24 | | SENATE |
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| 25 | 25 | | STATE OF MINNESOTA |
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| 26 | 26 | | S.F. No. 1891NINETY-FOURTH SESSION |
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| 27 | 27 | | (SENATE AUTHORS: LANG) |
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| 28 | 28 | | OFFICIAL STATUSD-PGDATE |
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| 29 | 29 | | Introduction and first reading02/27/2025 |
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| 30 | 30 | | Referred to State and Local Government 2.1 (6) in the director's judgment does not have the financial stability or responsibility to |
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| 31 | 31 | | 2.2act as a lottery retailer, or whose contracting as a lottery retailer would adversely affect the |
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| 32 | 32 | | 2.3public health, welfare, and safety, or endanger the security and integrity of the lottery; or |
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| 33 | 33 | | 2.4 (7) is a currency exchange, as defined in section 53A.01. |
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| 34 | 34 | | 2.5 A contract entered into before August 1, 1990, which violates clause (7) may continue |
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| 35 | 35 | | 2.6in effect until its expiration but may not be renewed. |
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| 36 | 36 | | 2.7 (b) The director may not contract with an organization, firm, partnership, or corporation |
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| 37 | 37 | | 2.8that: |
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| 38 | 38 | | 2.9 (1) has a responsible lottery official who: (i) is under the age of 18; (ii) owes $500 or |
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| 39 | 39 | | 2.10more in delinquent taxes as defined in section 270C.72; or (iii) has been convicted within |
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| 40 | 40 | | 2.11the previous five years of a felony or gross misdemeanor, any crime involving fraud or |
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| 41 | 41 | | 2.12misrepresentation, or a gambling-related offense in any jurisdiction in the United States; |
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| 42 | 42 | | 2.13 (2) An organization, firm, partnership, or corporation that has a stockholder who owns |
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| 43 | 43 | | 2.14more than five percent of the business or the stock of the corporation, a responsible lottery |
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| 44 | 44 | | 2.15official, an officer, or a director, that does not meet the requirements of paragraph (a), clause |
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| 45 | 45 | | 2.16(4), is not eligible to be a lottery retailer under this section is a member of the immediate |
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| 46 | 46 | | 2.17family, residing in the same household, as the director or any employee of the lottery; or |
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| 47 | 47 | | 2.18 (3)(i) is in the business solely as a seller of lottery tickets; (ii) in the director's judgment |
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| 48 | 48 | | 2.19does not have the financial stability or responsibility to act as a lottery retailer, or whose |
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| 49 | 49 | | 2.20contracting as a lottery retailer would adversely affect the public health, welfare, and safety, |
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| 50 | 50 | | 2.21or endanger the security and integrity of the lottery; or (iii) is a currency exchange, as defined |
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| 51 | 51 | | 2.22in section 53A.01. |
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| 52 | 52 | | 2.23 (c) The restrictions under paragraph (a), clause (4), do not apply to an organization, |
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| 53 | 53 | | 2.24partnership, or corporation if the director determines that the organization, partnership, or |
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| 54 | 54 | | 2.25firm has terminated its relationship with the individual whose actions directly contributed |
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| 55 | 55 | | 2.26to the disqualification under this subdivision. |
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| 56 | 56 | | 2.27 Sec. 3. Minnesota Statutes 2024, section 349A.06, subdivision 11, is amended to read: |
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| 57 | 57 | | 2.28 Subd. 11.Cancellation, suspension, and refusal to renew contracts or locations.(a) |
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| 58 | 58 | | 2.29The director shall cancel the contract of any lottery retailer or prohibit a lottery retailer from |
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| 59 | 59 | | 2.30selling lottery tickets at a business location who: |
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| 60 | 60 | | 2.31 (1) has a sole proprietor or responsible lottery official that has been convicted of a felony |
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| 61 | 61 | | 2.32or gross misdemeanor in any jurisdiction in the United States; |
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| 62 | 62 | | 2Sec. 3. |
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| 63 | 63 | | 25-01999 as introduced02/18/25 REVISOR JSK/AD 3.1 (2) has a sole proprietor or responsible lottery official that has committed fraud, |
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| 64 | 64 | | 3.2misrepresentation, or deceit any crime involving fraud or misrepresentation, or a |
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| 65 | 65 | | 3.3gambling-related offense in any jurisdiction in the United States; |
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| 66 | 66 | | 3.4 (3) has provided false or misleading information to the lottery; or |
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| 67 | 67 | | 3.5 (4) has acted in a manner prejudicial to public confidence in the integrity of the lottery. |
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| 68 | 68 | | 3.6 (b) The director may cancel, suspend, or refuse to renew the contract of any lottery |
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| 69 | 69 | | 3.7retailer or prohibit a lottery retailer from selling lottery tickets at a business location who: |
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| 70 | 70 | | 3.8 (1) changes business location; |
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| 71 | 71 | | 3.9 (2) fails to account for lottery tickets received or the proceeds from tickets sold; |
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| 72 | 72 | | 3.10 (3) fails to remit funds to the director in accordance with the director's rules; |
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| 73 | 73 | | 3.11 (4) violates a law or a rule or order of the director; |
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| 74 | 74 | | 3.12 (5) fails to comply with any of the terms in the lottery retailer's contract; |
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| 75 | 75 | | 3.13 (6) fails to file a bond, securities, or a letter of credit as required under subdivision 3; |
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| 76 | 76 | | 3.14 (7) in the opinion of the director fails to maintain a sufficient sales volume to justify |
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| 77 | 77 | | 3.15continuation as a lottery retailer; or |
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| 78 | 78 | | 3.16 (8) has violated section 340A.503, subdivision 2, clause (1), two or more times within |
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| 79 | 79 | | 3.17a two-year period. |
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| 80 | 80 | | 3.18 (c) The director may also cancel, suspend, or refuse to renew a lottery retailer's contract |
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| 81 | 81 | | 3.19or prohibit a lottery retailer from selling lottery tickets at a business location if there is a |
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| 82 | 82 | | 3.20material change in any of the factors considered by the director under subdivision 2. |
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| 83 | 83 | | 3.21 (d) A contract cancellation, suspension, refusal to renew, or prohibiting a lottery retailer |
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| 84 | 84 | | 3.22from selling lottery tickets at a business location under this subdivision is a contested case |
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| 85 | 85 | | 3.23under sections 14.57 to 14.69 and is in addition to any criminal penalties provided for a |
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| 86 | 86 | | 3.24violation of law or rule. |
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| 87 | 87 | | 3.25 (e) The director may temporarily suspend a contract or temporarily prohibit a lottery |
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| 88 | 88 | | 3.26retailer from selling lottery tickets at a business location without notice for any of the reasons |
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| 89 | 89 | | 3.27specified in this subdivision provided that a hearing is conducted within seven days after a |
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| 90 | 90 | | 3.28request for a hearing is made by a lottery retailer. Within 20 days after receiving the |
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| 91 | 91 | | 3.29administrative law judge's report, the director shall issue an order vacating the temporary |
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| 92 | 92 | | 3.30suspension or prohibition or making any other appropriate order. If no hearing is requested |
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| 93 | 93 | | 3Sec. 3. |
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| 94 | 94 | | 25-01999 as introduced02/18/25 REVISOR JSK/AD 4.1within 30 days of the temporary suspension or prohibition taking effect, the suspension or |
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| 95 | 95 | | 4.2prohibition becomes permanent unless the director vacates or modifies the order. |
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| 96 | 96 | | 4Sec. 3. |
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| 97 | 97 | | 25-01999 as introduced02/18/25 REVISOR JSK/AD |
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