S.F. _____ H.F. _____ DIVISION I 1 SOCIAL AND CHARITABLE GAMBLING 2 Section 1. Section 99B.1, subsection 1, Code 2015, is 3 amended by striking the subsection and inserting in lieu 4 thereof the following: 5 1. “Amusement concession” means a game of skill or 6 game of chance with an instant win possibility where, if 7 the participant completes a task, the participant wins a 8 prize. “Amusement concession” includes but is not limited to 9 carnival-style games that are conducted by a person for profit. 10 “Amusement concession” does not include casino-style games or 11 amusement devices required to be registered pursuant to section 12 99B.53. 13 Sec. 2. Section 99B.1, subsections 2, 3, 5, 6, 15, 16, 17, 14 20, 21, and 26, Code 2015, are amended to read as follows: 15 2. “Amusement device” means an electrical or mechanical 16 device possessed and used in accordance with section 99B.10 17 this chapter . When possessed and used in accordance with 18 that section this chapter , an amusement device is not a game of 19 skill or game of chance, and is not a gambling device. 20 3. “Applicant” means an individual or an organization 21 applying for a license under this chapter . 22 5. “Bingo” means a game, whether known as bingo or any other 23 name, in which each participant uses one or more cards each 24 of which is marked off into spaces arranged in horizontal and 25 vertical rows of spaces, with each space being designated by 26 number, letter, symbol, or picture, or combination of numbers , 27 and letters, no symbols, or pictures. No two cards being shall 28 be identical , with . In the game of bingo, players covering 29 shall cover spaces on the card or cards as the operator of the 30 game announces to the players the number, letter, symbol, or 31 picture, or combination of numbers , and letters , symbols, or 32 pictures, appearing on an object selected by chance, either 33 manually or mechanically, from a receptacle in which have 34 been placed objects bearing numbers, letters, symbols, or 35 -1- LSB 1314XD (11) 86 ec/nh 1/ 63

S.F. _____ H.F. _____ pictures, or combinations of numbers , and letters , symbols, 1 or pictures corresponding to the system used for designating 2 the spaces , with the . The winner of each game being is the 3 player or players first properly covering a predetermined and 4 announced pattern of spaces on a card being used by the player 5 or players . Each determination of a winner by the method 6 described in the preceding sentence this subsection is a single 7 bingo game at any bingo occasion. 8 6. “Bingo occasion” means a single gathering or session 9 at which successive a series of bingo games are is played. A 10 bingo occasion commences begins when the operator of the a 11 bingo game begins to announce the selects an object with a 12 number, letter, symbol, or picture, or combination of numbers , 13 or letters , symbols, or pictures through which the winner of a 14 single the first bingo game in a series of bingo games will be 15 determined. A bingo occasion ends when at least one hour has 16 elapsed since a bingo game is played or when an announcement by 17 the operator of the bingo game is made that the bingo occasion 18 is over, whichever first occurs. 19 15. “Game of chance” means a game whereby the result is 20 determined by chance and the player in order to win aligns 21 completes activities, such as aligning objects or balls in a 22 prescribed pattern or order or makes certain color patterns 23 appear and . “Game of chance” specifically includes but is not 24 limited to the game defined as bingo. Game of chance “Game of 25 chance” does not include a slot machine or amusement device . 26 16. “Game of skill” means a game whereby the result is 27 determined by the player player’s ability to do a task, such as 28 directing or throwing objects to designated areas or targets, 29 or by maneuvering water or an object into a designated area, or 30 by maneuvering a dragline device to pick up particular items, 31 or by shooting a gun or rifle. 32 17. “Gross receipts” means the total revenue received from 33 the sale of rights to participate in a game of skill, game of 34 chance, bingo, or raffle and admission fees or charges. 35 -2- LSB 1314XD (11) 86 ec/nh 2/ 63

S.F. _____ H.F. _____ 20. “Merchandise” means goods or services that are bought 1 and sold in the regular course of business. “Merchandise” 2 includes lottery tickets or shares sold or authorized under 3 chapter 99G . The value of the lottery ticket or share is the 4 price of the lottery ticket or share as established by the 5 Iowa lottery authority pursuant to chapter 99G . “Merchandise” 6 includes a gift card if the gift card is not redeemable for 7 cash. 8 21. “Net receipts” means gross receipts less amounts awarded 9 as prizes and less state and local sales tax paid upon the 10 gross receipts. Reasonable expenses, charges, fees, taxes 11 other than the state and local sales tax, and deductions 12 allowed by the department shall not exceed twenty-five percent 13 of net receipts. 14 26. “Raffle” means a lottery in which each participant 15 buys a ticket an entry for a chance at a prize with the winner 16 determined by a random method and the winner is not required to 17 be present to win. “Raffle” does not include a slot machine. 18 Sec. 3. Section 99B.1, subsections 4, 10, 12, 13, 18, 19, 19 23, 24, 27, and 28, Code 2015, are amended by striking the 20 subsections. 21 Sec. 4. Section 99B.1, subsection 8, Code 2015, is amended 22 by striking the subsection and inserting in lieu thereof the 23 following: 24 8. “Bookmaking” means the determining of odds and receipt 25 and paying off of bets by an individual or publicly or 26 privately owned enterprise not present when the wager or bet 27 was undertaken. 28 Sec. 5. Section 99B.1, Code 2015, is amended by adding the 29 following new subsections: 30 NEW SUBSECTION . 8A. “Build-up or pyramid” means a raffle 31 or a game in which a prize must be returned in order to play 32 another game or to be eligible for another bigger prize, a game 33 in which a prize must be forfeited if a later game is lost, or a 34 raffle which is multi-step and requires the participant to win 35 -3- LSB 1314XD (11) 86 ec/nh 3/ 63

S.F. _____ H.F. _____ at multiple steps to win the grand prize. 1 NEW SUBSECTION . 8B. “Calendar raffle” means a raffle where 2 a single entry is entered in one raffle where winners will be 3 selected over multiple dates. 4 NEW SUBSECTION . 8C. “Casino-style games” means any house 5 banking game, including but not limited to casino-style card 6 games such as poker, baccarat, chemin de fer, blackjack, and 7 pai gow, and casino games such as roulette, craps, and keno. 8 “Casino-style games” does not include a slot machine. 9 NEW SUBSECTION . 8D. “Charitable uses” includes uses 10 benefiting a definite number of persons who are the victims of 11 loss of home or household possessions through explosion, fire, 12 flood, or storm when the loss is uncompensated by insurance, 13 and uses benefiting a definite number of persons suffering from 14 a seriously disabling disease or injury, causing severe loss of 15 income or incurring extraordinary medical expense when the loss 16 is uncompensated by insurance. 17 NEW SUBSECTION . 12A. “Educational, civic, public, 18 charitable, patriotic, or religious uses” includes uses 19 benefiting a society for the prevention of cruelty to animals 20 or animal rescue league; uses benefiting an indefinite 21 number of persons either by bringing them under the influence 22 of education or religion or relieving them from disease, 23 suffering, or constraint, or by erecting or maintaining 24 public buildings or works, or otherwise lessening the burden 25 of government; and uses benefiting any bona fide nationally 26 chartered fraternal or military veterans’ corporation or 27 organization which operates in Iowa a clubroom, post, dining 28 room, or dance hall, but does not include the erection, 29 acquisition, improvement, maintenance, or repair of real, 30 personal, or mixed property unless it is used for one or more 31 of the uses described in this subsection. 32 NEW SUBSECTION . 14A. “Gambling” means any activity where a 33 person risks something of value or other consideration for a 34 chance to win a prize. 35 -4- LSB 1314XD (11) 86 ec/nh 4/ 63

S.F. _____ H.F. _____ NEW SUBSECTION . 14B. “Game night” means an event at 1 which casino-style games may be conducted, in addition to 2 games of skill and games of chance, within one consecutive 3 twenty-four-hour period. 4 NEW SUBSECTION . 17A. “Licensed qualified organization” 5 means a qualified organization that is issued a license under 6 this chapter and that complies with the requirements for a 7 qualified organization issued a license under this chapter. 8 NEW SUBSECTION . 24A. “Public uses” specifically includes 9 dedication of net receipts to political parties as defined in 10 section 43.2. 11 Sec. 6. Section 99B.1, subsection 25, Code 2015, is amended 12 by striking the subsection and inserting in lieu thereof the 13 following: 14 25. “Qualified organization” means an organization that has 15 an active membership of not less than twelve persons, does not 16 have a self-perpetuating governing body and officers, and meets 17 any of the following requirements: 18 a. Is exempt from federal income taxes under section 19 501(c)(3), 501(c)(4), 501(c)(5), 501(c)(6), 501(c)(7), 20 501(c)(8), 501(c)(10), or 501(c)(19) of the Internal Revenue 21 Code as defined in section 422.3. 22 b. Is an agency or instrumentality of the United States 23 government, this state, or a political subdivision of this 24 state. 25 c. Is a parent-teacher organization or booster club that 26 is recognized as a fund-raiser and supporter for a school 27 district organized pursuant to chapter 274 or for a school 28 within the school district, in a notarized letter signed by the 29 president of the board of directors, the superintendent of the 30 school district, or a principal of a school within that school 31 district. 32 d. Is a political party, as defined in section 43.2, or a 33 nonparty political organization that has qualified to place 34 a candidate as its nominee for statewide office pursuant to 35 -5- LSB 1314XD (11) 86 ec/nh 5/ 63

S.F. _____ H.F. _____ chapter 44, or to a candidate’s committee as defined in section 1 68A.102. 2 Sec. 7. Section 99B.3, Code 2015, is amended to read as 3 follows: 4 99B.3 Amusement concessions. 5 1. A game of skill or game of chance is lawful when 6 conducted by a person at an amusement concession, but only 7 A person may conduct an amusement concession if all of the 8 following are complied with conditions are met : 9 a. The location where the game is conducted by the person 10 has been authorized as provided in section 99B.4 . 11 b. The person conducting the game amusement concession has 12 submitted a license application and a fee of fifty dollars for 13 each game amusement concession , and has been issued a license 14 for the game amusement concession , and prominently displays the 15 license at the playing area of the game amusement concession . 16 A license is valid for a period of one year from the date of 17 issue. 18 c. Gambling other than the licensed game is not conducted or 19 engaged in at the amusement concession. 20 d. b. The game is rules of the amusement concession are 21 prominently posted and the visible from all playing positions. 22 c. The cost to play the game a single amusement concession 23 does not exceed three five dollars. 24 e. d. A prize is not displayed which cannot be won. 25 f. e. Cash prizes are not awarded and merchandise prizes 26 are not repurchased . 27 g. f. The game amusement concession is not operated on a 28 build-up or pyramid basis. 29 g. A pet, as defined in section 717E.1, is not awarded. 30 h. The actual retail value of any prize does not exceed 31 fifty one-hundred dollars. If a prize consists of more than 32 one item, unit, or part, the aggregate retail value of all 33 items, units, or parts shall not exceed fifty one hundred 34 dollars. 35 -6- LSB 1314XD (11) 86 ec/nh 6/ 63

S.F. _____ H.F. _____ i. Merchandise prizes are not repurchased from the 1 participants. However, a participant may have the option, at 2 no additional cost to the participant, of trading multiple 3 smaller prizes for a single larger prize. 4 j. Concealed numbers or conversion charts are not used to 5 play the game and the game amusement concession. 6 k. The amusement concession is not designed or adapted with 7 any control device to permit manipulation of the game amusement 8 concession by the operator in order to prevent a player from 9 winning or to predetermine who the winner will be , and the 10 object target, block or . 11 l. The object of the game amusement concession must be 12 attainable and possible to perform under the rules stated from 13 the all playing position of the player positions . 14 j. m. The game amusement concession is conducted in a fair 15 and honest manner. 16 2. It is lawful for an An individual other than a person 17 conducting the game to amusement concession may participate in 18 a game of skill or game of chance conducted at an amusement 19 concession, whether or not the amusement concession is 20 conducted in compliance with subsection 1 this section . 21 Sec. 8. Section 99B.5A, subsection 1, paragraph b, Code 22 2015, is amended to read as follows: 23 b. “Community group” means an Iowa nonprofit, tax-exempt 24 organization which is open to the general public and 25 established for the promotion and development of the arts, 26 history, culture, ethnicity, historic preservation, tourism, 27 economic development, festivals, or municipal libraries. 28 “Community group” does not include a school, college, 29 university, political party, labor union, state or federal 30 government agency, fraternal organization, church, convention 31 or association of churches, or organizations operated primarily 32 for religious purposes, or which are operated, supervised, 33 controlled, or principally supported by a church, convention, 34 or association of churches. 35 -7- LSB 1314XD (11) 86 ec/nh 7/ 63

S.F. _____ H.F. _____ Sec. 9. Section 99B.5A, subsection 2, paragraphs a, c, and 1 e, Code 2015, are amended to read as follows: 2 a. Bingo is conducted by the sponsor of the fair or 3 community festival or a qualified organization licensed under 4 section 99B.7 99B.12B that has received permission from the 5 sponsor of the fair or community festival to conduct bingo. 6 c. The number of bingo occasions conducted by a licensee 7 under this section shall be limited to one for each day of the 8 duration of the fair or community festival. 9 e. Except as provided in this section , the provisions of 10 sections 99B.2 and 99B.7 this chapter related to bingo shall 11 apply. 12 Sec. 10. Section 99B.5A, subsection 4, Code 2015, is amended 13 to read as follows: 14 4. Bingo occasions held under a license under this section 15 shall not be counted in determining whether a qualified 16 organization has conducted more than fourteen fifteen bingo 17 occasions per month. In addition, bingo occasions held under 18 this license shall not be limited to four consecutive hours. 19 Sec. 11. Section 99B.6, Code 2015, is amended by striking 20 the section and inserting in lieu thereof the following: 21 99B.6 Social gambling in licensed alcohol establishments. 22 1. Social gambling is lawful on the premises of an 23 establishment for which a class “A”, class “B”, class “C”, 24 special class “C”, or class “D” liquor control license, or 25 class “B” beer permit has been issued pursuant to chapter 123 26 when, subject to the provisions of section 99B.42, all of the 27 following requirements are met: 28 a. The liquor control licensee or beer permittee has 29 submitted an application for a social gambling license and a 30 license fee of one hundred fifty dollars to the department, and 31 a license has been issued. 32 b. The license is prominently displayed on the premises of 33 the establishment. 34 c. The social gambling licensee or any agent or employee 35 -8- LSB 1314XD (11) 86 ec/nh 8/ 63

S.F. _____ H.F. _____ of the licensee does not participate in, sponsor, conduct, 1 promote, or act as cashier or banker for any social gambling, 2 except as a participant while playing on the same basis as 3 every other participant. 4 d. A person under the age of twenty-one years shall not 5 participate in the social games. A social gambling licensee 6 or an agent or employee of the licensee who knowingly allows 7 a person under the age of twenty-one to participate in the 8 gambling prohibited by this section or a person who knowingly 9 participates in gambling with a person under the age of 10 twenty-one, is subject to a penalty under section 99B.15. 11 2. A liquor control licensee or beer permittee with a social 12 gambling license issued pursuant to this section may conduct 13 a sports betting pool if all of the requirements of this 14 subsection are met. 15 a. The pool shall be publicly displayed and the rules of 16 the pool, including the cost per participant and the amount or 17 amounts that will be won, shall be conspicuously displayed on 18 or near the pool. 19 b. A participant shall not wager more than five dollars in 20 the pool. 21 c. The maximum winnings awarded to all participants in the 22 pool shall not exceed five hundred dollars. 23 d. The provisions of section 99B.42, except section 99B.42, 24 subsection 1, paragraphs “a” and “h” , are applicable to pools 25 conducted under this subsection. 26 e. The use of concealed numbers in the pool is permissible. 27 If the pool involves the use of concealed numbers, the numbers 28 shall be selected by a random method and no person shall be 29 aware of the numbers at the time wagers are made in the pool. 30 f. All moneys wagered in the pool shall be awarded as 31 winnings to participants. 32 3. An establishment issued a social gambling license under 33 this section that is required to obtain a new liquor license 34 or permit under chapter 123 due to a change in ownership shall 35 -9- LSB 1314XD (11) 86 ec/nh 9/ 63

S.F. _____ H.F. _____ be required to obtain a new social gambling license under this 1 section to conduct social gambling. 2 Sec. 12. Section 99B.7A, Code 2015, is amended by striking 3 the section and inserting in lieu thereof the following: 4 99B.7A Manufacturers and distributors —— bingo equipment and 5 supplies —— electronic raffle systems —— transfer or use. 6 1. As used in this section, unless the context otherwise 7 requires, “manufacturer or distributor” means a person engaged 8 in business in this state who originally produces, or purchases 9 from a business that originally produces, equipment or supplies 10 which are specifically used in the conduct of a bingo occasion 11 or an electronic raffle. 12 2. A person shall not engage in business in this state as a 13 manufacturer or distributor without first obtaining a license 14 from the department. 15 a. Upon receipt of an application and a fee of one thousand 16 dollars for a manufacturer or distributor license, the 17 department may issue an annual license. 18 b. A license may be renewed annually upon submission of an 19 application, payment of the annual license fee, and compliance 20 with this section and the rules adopted pursuant to this 21 section. 22 3. A licensed manufacturer or distributor may sell bingo 23 equipment or supplies or an electronic raffle system directly 24 to a licensed qualified organization. 25 4. A licensed qualified organization under this chapter 26 may dispose of, transfer, or sell excess bingo equipment or 27 supplies on a nonroutine basis to another licensed qualified 28 organization. 29 5. A licensed qualified organization shall not sublease, 30 rent, borrow, or otherwise use another qualified organization’s 31 electronic raffle system. 32 Sec. 13. Section 99B.7B, subsection 1, Code 2015, is amended 33 to read as follows: 34 1. As used in this section , unless the context otherwise 35 -10- LSB 1314XD (11) 86 ec/nh 10/ 63

S.F. _____ H.F. _____ requires: 1 a. “Card game” means only includes but is not limited to 2 poker, pinochle, pitch, gin rummy, bridge, euchre, hearts, or 3 cribbage. 4 b. “Qualified organization representing veterans” means any 5 licensed qualified organization representing which represents 6 veterans, which is a post, branch, or chapter of a national 7 association of veterans of the armed forces of the United 8 States which is a federally chartered corporation, dedicates 9 the net receipts of a game of skill, game of chance, or raffle 10 as provided in section 99B.7 99B.14A , and is exempt from 11 federal income taxes under section 501(c)(19) of the Internal 12 Revenue Code as defined in section 422.3 , has an active 13 membership of not less than twelve persons, and does not have a 14 self-perpetuating governing body and officers . 15 Sec. 14. Section 99B.7B, subsection 2, Code 2015, is amended 16 by adding the following new paragraph: 17 NEW PARAGRAPH . 0a. The qualified organization representing 18 veterans has been issued a license pursuant to section 99B.12B. 19 The license application shall identify the premises where the 20 card game tournaments are to be conducted and the occupancy 21 limit of the premises, and shall include documentation that 22 the qualified organization representing veterans has conducted 23 regular meetings of the organization at the premises during the 24 previous eight months. 25 Sec. 15. Section 99B.7B, subsection 2, paragraphs a, b, c, 26 d, e, and g, Code 2015, are amended to read as follows: 27 a. The qualified organization conducting the card game 28 tournament has been issued a license pursuant to subsection 4 29 and representing veterans prominently displays that the license 30 in the playing area of the card game tournament. 31 b. The card games to be conducted during a card game 32 tournament, including the rules of each card game and how 33 winners are determined, shall be displayed prominently in the 34 playing area of the card game tournament. 35 -11- LSB 1314XD (11) 86 ec/nh 11/ 63

S.F. _____ H.F. _____ 0c. Each card game shall be conducted in a fair and honest 1 manner and . 2 00c. Each card game shall not be operated on a build-up or 3 pyramid basis. 4 000c. Every participant in a card game tournament must be 5 given the same chances of winning the tournament and shall not 6 be allowed any second chance entries or multiple entries in the 7 card game tournament. 8 c. Participation in a card game tournament conducted by 9 a qualified organization representing veterans shall only be 10 open to members of the qualified organization representing 11 veterans and guests of members of the qualified organization 12 participating in the tournament, subject to the requirements of 13 this section . 14 0d. The total number of members and guests participating in 15 a card game tournament shall not exceed the occupancy limit of 16 the premises where the card game tournament is being conducted. 17 00d. Participants in a card game tournament shall be at 18 least twenty-one years of age. 19 d. (1) If the card game tournament is limited to one guest 20 for each member of the qualified organization representing 21 veterans participating in the tournament, then the requirements 22 of this subparagraph (1) shall apply. The cost to participate 23 in a card game tournament under this subparagraph (1) shall be 24 limited to one hundred dollars and shall be the same for every 25 participant in the card game tournament. Cash or merchandise 26 prizes may be awarded during a card game tournament under this 27 subparagraph (1) and shall not exceed one thousand dollars and 28 no participant shall win more than a total of five hundred 29 dollars. 30 (2) If the card game tournament is not limited to one guest 31 for each member of the qualified organization representing 32 veterans participating in the tournament, then the requirements 33 of this subparagraph (2) shall apply. The cost to participate 34 in a card game tournament under this subparagraph (2) shall be 35 -12- LSB 1314XD (11) 86 ec/nh 12/ 63

S.F. _____ H.F. _____ limited to twenty-five dollars and shall be the same for every 1 participant in the card game tournament. Cash or merchandise 2 prizes may be awarded during a card game tournament under this 3 subparagraph (2) and shall not exceed three hundred dollars 4 and no participant shall win more than a total of two hundred 5 dollars. 6 (3) 0e. A qualified organization representing veterans 7 shall distribute amounts awarded as prizes on the day they 8 are won and merchandise prizes shall not be repurchased. An 9 organization conducting a card game tournament shall only 10 display prizes in the playing area of the card game tournament 11 that can be won. 12 e. The qualified organization representing veterans shall 13 conduct each card game tournament and any card game conducted 14 during the tournament and shall not contract with or permit 15 another person to conduct the card game tournament or any card 16 game during the tournament. In addition, the 17 0f. The card game tournament and any card game conducted 18 during the tournament shall be conducted only on the premises 19 of the qualified organization representing veterans as 20 identified in the license application pursuant to as required 21 by this subsection 4 . 22 g. A qualified organization representing veterans licensed 23 under this section shall not hold more than two card game 24 tournaments per month and shall not hold a card game tournament 25 within seven calendar days of another card game tournament 26 conducted by that qualified organization representing veterans. 27 Card game tournaments held under an annual during a game night 28 license conducted pursuant to section 99B.26 shall not count 29 toward the limit of one card game tournament per week for a 30 license holder. A qualified organization representing veterans 31 shall be allowed to hold only one card game tournament during 32 any period of twenty-four consecutive hours, starting from the 33 time the card game tournament begins. 34 Sec. 16. Section 99B.7B, subsection 2, paragraph h, Code 35 -13- LSB 1314XD (11) 86 ec/nh 13/ 63

S.F. _____ H.F. _____ 2015, is amended by striking the paragraph. 1 Sec. 17. Section 99B.7B, subsection 3, Code 2015, is amended 2 to read as follows: 3 3. The qualified organization representing veterans 4 licensed to hold card game tournaments under this section 5 shall keep a journal of all dates of events, amount of gross 6 receipts, amount given out as prizes, expenses, amount 7 collected for taxes, and the amount collected as revenue. 8 a. The qualified organization representing veterans shall 9 dedicate and distribute the net receipts from each card 10 game tournament as provided in section 99B.7, subsection 3, 11 paragraph “b” 99B.14A . 12 b. Each qualified organization representing veterans shall 13 withhold that portion of the gross receipts subject to taxation 14 pursuant to section 423.2, subsection 4 , which shall be kept 15 in a separate account and sent to the state along with the 16 organization’s annual report required by section 99B.2 99B.16A . 17 c. A qualified organization representing veterans licensed 18 to conduct card game tournaments is allowed to may withhold no 19 more than five percent of the gross receipts from each card 20 game tournament for qualified expenses. Qualified expenses 21 include but are not limited to the purchase of supplies and 22 materials used in conducting card games. Any money collected 23 for expenses and not used by the end of the state fiscal year 24 shall be donated for educational, civic, public, charitable, 25 patriotic, or religious uses as described in section 99B.7, 26 subsection 3 , paragraph “b” . The qualified organization 27 representing veterans shall attach a receipt for any donation 28 made to the annual report required to be submitted pursuant to 29 section 99B.2 99B.16A . 30 d. Each qualified organization representing veterans 31 licensed under this section shall make recordkeeping and all 32 deposit receipts available as provided in section 99B.2, 33 subsection 2 99B.16A . 34 Sec. 18. Section 99B.7B, subsection 4, Code 2015, is amended 35 -14- LSB 1314XD (11) 86 ec/nh 14/ 63

S.F. _____ H.F. _____ by striking the subsection. 1 Sec. 19. Section 99B.9, Code 2015, is amended by striking 2 the section and inserting in lieu thereof the following: 3 99B.9 Social gambling in public places. 4 Social gambling in a public place is lawful, subject to 5 the provisions of section 99B.42, if all of the following 6 requirements are met: 7 1. The social gambling is conducted at any public place 8 owned, leased, rented, or otherwise occupied by the licensee. 9 2. The person occupying the premises of the public place as 10 an owner or tenant has submitted an application for a license 11 and a fee of one hundred dollars to the department, and a 12 license has been issued. 13 3. The license is prominently displayed on the premises of 14 the public place. 15 4. The licensee or any agent or employee of the licensee 16 does not participate in, sponsor, conduct, promote, or act 17 as cashier or banker for any gambling activities, except as 18 a participant while playing on the same basis as every other 19 participant. 20 Sec. 20. Section 99B.10A, Code 2015, is amended to read as 21 follows: 22 99B.10A Electrical and or mechanical amusement device 23 manufacturers, distributors, and for-profit owners —— 24 registration. 25 1. A person engaged in business in this state as a 26 manufacturer, manufacturer’s representative, distributor, or 27 for-profit owner of electrical and or mechanical amusement 28 devices required to be registered as provided in section 29 99B.10, subsection 1, paragraph “f” 99B.53 , shall register with 30 the department. Each person who registers with the department 31 under this section shall pay an annual registration fee in an 32 amount as provided in subsection 2 . Registration shall be 33 submitted on application forms designated by the department 34 that shall contain the information required by the department 35 -15- LSB 1314XD (11) 86 ec/nh 15/ 63

S.F. _____ H.F. _____ by rule. The department shall adopt rules establishing the 1 criteria for approval or denial of a registration application 2 and providing for the submission of information to the 3 department by a person registered pursuant to this section if 4 information in the initial registration is changed, including 5 discontinuing the business in this state. 6 2. For purposes of this section , the annual registration fee 7 shall be as follows: 8 a. For a manufacturer or manufacturer’s representative , two 9 thousand five hundred dollars. 10 b. For a distributor, five thousand dollars. 11 c. For an owner of no more than two electrical and or 12 mechanical amusement devices registered as provided in section 13 99B.10, subsection 1, paragraph “f” 99B.53 , at a single location 14 or premises that is not an a qualified organization that meets 15 the requirements of section 99B.7, subsection 1 , paragraph “m” , 16 two thousand five hundred dollars. 17 Sec. 21. Section 99B.10B, Code 2015, is amended to read as 18 follows: 19 99B.10B Revocation of registration —— electrical and or 20 mechanical amusement devices —— suspension of liquor license or 21 beer permit. 22 1. a. The department may deny, suspend, or revoke a 23 registration issued pursuant to section 99B.10 or 99B.10A or 24 99B.53 , if the department finds that an applicant, registrant, 25 or an agent of a registrant violated or permitted a violation 26 of a provision of section 99B.10, 99B.10A , or 99B.10C , 99B.52, 27 or 99B.53, or a departmental rule adopted pursuant to chapter 28 17A , or for any other cause for which the director of the 29 department would be or would have been justified in refusing to 30 issue a registration, or upon the conviction of a person of a 31 violation of this chapter or a rule adopted under this chapter 32 which occurred on the premises where the registered amusement 33 device is or is to be located. However, the 34 b. The denial, suspension, or revocation of a registration 35 -16- LSB 1314XD (11) 86 ec/nh 16/ 63

S.F. _____ H.F. _____ for one amusement device does not require, but may result in, 1 the denial, suspension, or revocation of the registration for 2 a different amusement device held by the same distributor or 3 owner. 4 b. c. However, a A person who commits an offense of failing 5 to include a security mechanism on an amusement device as 6 required pursuant to section 99B.10, subsection 1, paragraph 7 “m” 99B.52, subsection 4 , shall be subject to a civil penalty in 8 the amount of two hundred fifty dollars. A person who commits, 9 within two years, a second offense of failing to include a 10 security mechanism on an amusement device shall be subject to 11 the provisions of paragraph “a” . 12 2. a. A person who commits an offense of awarding a cash 13 prize of fifty dollars or less in violation of section 99B.10, 14 subsection 1, paragraph “b” 99B.52, subsection 3 , pursuant to 15 rules adopted by the department, shall be subject to a civil 16 penalty in the amount of two hundred fifty dollars. 17 b. A person who commits, within two years, a second offense 18 of awarding a cash prize of fifty dollars or less in violation 19 of section 99B.10, subsection 1, paragraph “b” 99B.52, 20 subsection 3 , or a person who commits an offense of awarding a 21 cash prize of more than fifty dollars in violation of section 22 99B.10, subsection 1, paragraph “b” 99B.52, subsection 3 , 23 pursuant to rules adopted by the department, shall be subject 24 to revocation of the person’s registration and the following: 25 (1) If the person whose registration is revoked under this 26 paragraph “b” , is a person for which a class “A”, class “B”, 27 class “C”, special class “C”, or class “D” liquor control 28 license has been issued pursuant to chapter 123 , the person’s 29 liquor control license shall be suspended for a period of 30 fourteen days in the same manner as provided in section 123.50, 31 subsection 3 , paragraph “a” . 32 (2) If the person whose registration is revoked under this 33 paragraph “b” , is a person for which only a class “B” or class 34 “C” beer permit has been issued pursuant to chapter 123 , the 35 -17- LSB 1314XD (11) 86 ec/nh 17/ 63

S.F. _____ H.F. _____ person’s class “B” or class “C” beer permit shall be suspended 1 for a period of fourteen days in the same manner as provided in 2 section 123.50, subsection 3 , paragraph “a” . 3 (3) If a person owning or employed by an establishment 4 having a class “A”, class “B”, class “C”, special class “C”, 5 or class “D” liquor control license issued pursuant to chapter 6 123 commits an offense as provided in this paragraph “b” , the 7 liquor control license of the establishment shall be suspended 8 for a period of fourteen days in the same manner as provided in 9 section 123.50, subsection 3 , paragraph “a” . 10 (4) If a person owning or employed by an establishment 11 having a class “B” or class “C” beer permit issued pursuant to 12 chapter 123 commits an offense as provided in this paragraph 13 “b” , the beer permit of the establishment shall be suspended 14 for a period of fourteen days in the same manner as provided in 15 section 123.50, subsection 3 , paragraph “a” . 16 3. a. The process for denial, suspension, or revocation of 17 a registration issued pursuant to section 99B.10 or 99B.10A , 18 or 99B.53, shall commence by delivering to the applicant or 19 registrant by certified mail, return receipt requested, or 20 by personal service a notice , by means authorized by section 21 17A.18, setting forth the proposed action and the particular 22 reasons for such action. 23 b. (1) If a written request for a hearing is not received 24 within thirty days after the mailing or service of the the 25 delivery of notice as provided by paragraph “a” , the denial, 26 suspension, or revocation of a registration shall become 27 effective pending a final determination by the department. The 28 proposed action in the notice may be affirmed, modified, or set 29 aside by the department in a written decision. 30 (2) If a request for a hearing is timely received by 31 the department, the applicant or registrant shall be given 32 an opportunity for a prompt and fair hearing before the 33 department and the denial, suspension, or revocation shall 34 be deemed suspended until the department makes a final 35 -18- LSB 1314XD (11) 86 ec/nh 18/ 63

S.F. _____ H.F. _____ determination. However, the director of the department may 1 suspend a registration prior to a hearing if the director 2 finds that the public integrity of the registered activity 3 is compromised or there is a risk to public health, safety, 4 or welfare. In addition, at any time during or prior to the 5 hearing, the department may rescind the notice of the denial, 6 suspension, or revocation upon being satisfied that the reasons 7 for the denial, suspension, or revocation have been or will 8 be removed. On the basis of any such hearing, the proposed 9 action in the notice may be affirmed, modified, or set aside by 10 the department in a written decision. The procedure governing 11 hearings authorized by this paragraph shall be in accordance 12 with the rules promulgated by the department and chapter 17A . 13 c. A copy of the final decision of the department shall 14 be sent by electronic mail or certified mail, with return 15 receipt requested, or served personally upon the applicant or 16 registrant. The applicant or registrant may seek judicial 17 review in accordance with the terms of the Iowa administrative 18 procedure Act, chapter 17A . 19 d. If the department finds cause for denial of a 20 registration issued pursuant to section 99B.10 or 99B.10A , 21 or 99B.53, the applicant shall not reapply for the same 22 registration for a period of two years. If the department 23 finds cause for a suspension or revocation, the registration 24 shall be suspended or revoked for a period not to exceed two 25 years. 26 Sec. 22. Section 99B.10C, Code 2015, is amended to read as 27 follows: 28 99B.10C Electrical and Registered electrical or mechanical 29 amusement devices —— persons under twenty-one —— penalties. 30 1. A person under the age of twenty-one years shall not 31 participate in the operation of an a registered electrical and 32 or mechanical amusement device. A person who violates this 33 subsection commits a scheduled violation under section 805.8C, 34 subsection 4 . 35 -19- LSB 1314XD (11) 86 ec/nh 19/ 63

S.F. _____ H.F. _____ 2. A person owning or leasing an a registered electrical 1 and or mechanical amusement device, or an employee of a person 2 owning or leasing an a registered electrical and or mechanical 3 amusement device, who knowingly allows a person under the age 4 of twenty-one years to participate in the operation of an a 5 registered electrical and or mechanical amusement device, or 6 a person who knowingly participates in the operation of an a 7 registered electrical and or mechanical amusement device with a 8 person under the age of twenty-one years, is guilty of a simple 9 misdemeanor. 10 3. For purposes of this section , an electrical and 11 mechanical amusement device “registered electrical or mechanical 12 amusement device” means an electrical and or mechanical 13 amusement device required to be registered as provided in 14 section 99B.10, subsection 1, paragraph “f” 99B.53 . 15 Sec. 23. Section 99B.10D, Code 2015, is amended to read as 16 follows: 17 99B.10D Electrical and or mechanical amusement devices —— 18 special fund. 19 Fees collected by the department pursuant to sections 20 99B.10 and 99B.10A and 99B.53 shall be deposited in a special 21 fund created in the state treasury. Moneys in the fund are 22 appropriated to the department of inspections and appeals 23 and the department of public safety for administration and 24 enforcement of sections 99B.10 , 99B.10A , 99B.10B , and 99B.10C 25 this subchapter , including employment of necessary personnel. 26 The distribution of moneys in the fund to the department of 27 inspections and appeals and the department of public safety 28 shall be pursuant to a written policy agreed upon by the 29 departments. Notwithstanding section 12C.7, subsection 2 , 30 interest or earnings on moneys deposited in the fund shall be 31 credited to the fund. Notwithstanding section 8.33 , moneys 32 remaining in the fund at the end of a fiscal year shall not 33 revert to the general fund of the state. 34 Sec. 24. Section 99B.11, Code 2015, is amended to read as 35 -20- LSB 1314XD (11) 86 ec/nh 20/ 63

S.F. _____ H.F. _____ follows: 1 99B.11 Bona fide contests. 2 1. It is lawful for a A person to may conduct , without a 3 license, any of the contests specified in subsection 2 , and to 4 may offer and pay awards to persons winning in those contests 5 whether or not entry fees, participation fees, or other charges 6 are assessed against or collected from the participants, but 7 only if all of the following requirements are complied with 8 met : 9 a. The contest is not held at an amusement concession. 10 b. No A gambling device is not used in conjunction with, or 11 incident to the contest. 12 c. b. The contest is not conducted in whole or in part 13 on or in any property subject to chapter 297 , relating to 14 schoolhouses and schoolhouse sites, unless the contest and the 15 person conducting the contest has the express written approval 16 of the governing body of that school district. 17 d. c. The contest is conducted in a fair and honest manner. 18 d. A contest shall not be designed or adapted to permit the 19 operator of the contest to prevent a participant from winning 20 or to predetermine who the winner will be , and the . 21 e. The object of the contest must be attainable and possible 22 to perform under the rules stated. 23 f. If the contest is a tournament, the tournament operator 24 shall prominently display all tournament rules. 25 2. A contest , including a contest in a league or tournament, 26 is not lawful unless only if it is falls into one of the 27 following contests event categories : 28 a. Athletic or sporting events. Athletic or sporting 29 contests, leagues or tournaments, Events in this category 30 include basketball, volleyball, football, baseball, softball, 31 soccer, wrestling, swimming, track and field, racquetball, 32 tennis, squash, badminton, table tennis, rodeos, horse shows, 33 golf, bowling, trap or skeet shoots, fly casting, tractor 34 pulling, rifle, pistol, musket, or muzzle-loader shooting , pool 35 -21- LSB 1314XD (11) 86 ec/nh 21/ 63

S.F. _____ H.F. _____ billiards , darts, archery, and horseshoe contests, leagues, or 1 tournaments horseshoes . 2 b. Racing and skill-type events. Horse Events in this 3 category include horse races, harness racing, ski, airplane, 4 snowmobile, raft, boat, bicycle , and motor vehicle races. 5 c. Arts and crafts-type events. Contests or exhibitions 6 of Events in this category include cooking, horticulture, 7 livestock, poultry, fish or other animals, artwork, hobbywork 8 or , and craftwork, except those prohibited by chapter 717A . 9 d. Card game-type and board game-type events. Cribbage, 10 Events in this category include cribbage, bridge, euchre, 11 chess, checkers, dominoes, and pinochle and similar contests, 12 leagues or tournaments . The provisions of this paragraph are 13 retroactive to August 15, 1975. 14 e. Trivia and trading card events. 15 f. Video game-type and video sporting-type events. A video 16 machine golf tournament game which is an interactive bona fide 17 contest. A player operates a video machine golf tournament 18 game with a trackball assembly which acts as the golfer’s swing 19 and determines the results of play and tournament scores. A 20 video machine golf tournament game is capable of receiving 21 program and data information from an off-site location. A 22 tournament operator shall prominently display all tournament 23 rules. Events in this category include pinball games, video 24 games, and video machine golf tournament games, where skill 25 is the predominant factor in determining the result of play 26 and tournament scores. To be lawful, a player shall operate a 27 video machine with a device which directly impacts the results 28 of the game. 29 3. A poker, blackjack, craps, keno, or roulette contest, 30 league, or tournament shall not be considered a bona fide 31 contest under this section . 32 Sec. 25. NEW SECTION . 99B.11A Definitions. 33 As used in this subchapter and subchapter III, unless the 34 context otherwise requires: 35 -22- LSB 1314XD (11) 86 ec/nh 22/ 63

S.F. _____ H.F. _____ 1. “Electronic bingo equipment” means an electronic device 1 that assists an individual with a disability in the use of a 2 bingo card during a bingo game. 3 2. “Large raffle” means a raffle where the cumulative value 4 of cash and prizes is more than ten thousand dollars but not 5 more than one hundred thousand dollars. 6 3. “Small raffle” means a raffle where the cumulative value 7 of cash and prizes is more than one thousand dollars but not 8 more than ten thousand dollars. 9 4. “Very large raffle” means a raffle where the cumulative 10 value of cash and prizes is more than one hundred thousand 11 dollars but not more than two hundred thousand dollars or the 12 prize is real property. 13 5. “Very small raffle” means a raffle where the cumulative 14 value of the prize or prizes is one thousand dollars or less 15 and the value of all entries sold is one thousand dollars or 16 less. 17 Sec. 26. Section 99B.12, Code 2015, is amended by striking 18 the section and inserting in lieu thereof the following: 19 99B.12 Social gambling between individuals. 20 1. An individual may participate in social gambling if, 21 subject to the requirements of section 99B.42, all of the 22 following requirements are met: 23 a. The gambling is not participated in, either wholly or in 24 part, on or in any schoolhouses, schoolhouse sites, or other 25 property subject to chapter 297. 26 b. All participants in the gambling are individuals. 27 c. A person shall not participate in any wager, bet, or 28 pool which relates to an athletic event or contest and which 29 is authorized or sponsored by one or more schools, educational 30 institutions, or interscholastic athletic organizations, if 31 the person is a coach, official, player, or contestant in the 32 athletic event or contest. 33 d. In any game requiring a dealer or operator, the 34 participants must have the option to take their turn at dealing 35 -23- LSB 1314XD (11) 86 ec/nh 23/ 63

S.F. _____ H.F. _____ or operating the game in a regular order according to the 1 standard rules of the game. 2 2. Social gambling allowed under this section is limited to 3 any of the following: 4 a. Games of skill and games of chance, except casino-style 5 games other than poker. 6 b. Wagers or bets between two or more individuals who are 7 physically in the presence of each other with respect to any 8 of the following: 9 (1) A contest specified in section 99B.11, except that no 10 individual shall win or lose more than a total of fifty dollars 11 or equivalent consideration in one or more contests at any time 12 during any period of twenty-four consecutive hours or over that 13 entire period. 14 (2) Any other event or outcome which does not depend upon 15 gambling or the use of a gambling device that is unlawful in 16 this state. 17 Sec. 27. NEW SECTION . 99B.12B Qualified organization 18 licenses —— general provisions —— types of licenses. 19 1. General provisions. 20 a. A qualified organization shall submit an application for 21 a license, along with any required fees, to the department at 22 least thirty days in advance of the beginning of the gambling 23 activity, including the sale of entries or promotion of the 24 sale of entries for raffles. 25 b. For purposes of this section, a license is deemed to be 26 issued on the first day of the period for which the license is 27 issued. 28 c. An applicant that has not submitted an annual report 29 required pursuant to section 99B.16A shall submit such report 30 prior to approval of the application. 31 d. A license shall not be issued to an applicant whose 32 previous license issued under this chapter or chapter 123 has 33 been revoked until the period of revocation or revocations has 34 elapsed. 35 -24- LSB 1314XD (11) 86 ec/nh 24/ 63

S.F. _____ H.F. _____ e. The license fee is not refundable. 1 2. Two-year qualified organization license. 2 a. The license fee for a two-year qualified organization 3 license is one hundred fifty dollars. 4 b. An applicant for a license under this subsection shall 5 be a qualified organization that has been in existence for at 6 least five years, or is a local chapter or an affiliate of a 7 national tax-exempt organization that has been in existence 8 for at least two years and has provided written authorization 9 from the national organization to the department. The national 10 tax-exempt organization shall be exempt from federal income 11 taxes as described in section 99B.1, subsection 25, paragraph 12 “a” , and have been in existence at least five years. 13 c. A qualified organization issued a two-year qualified 14 organization license may conduct the following activities: 15 (1) Unlimited games of skill or games of chance except for 16 bingo. 17 (2) An unlimited number of very small raffles and an 18 unlimited number of small raffles, including electronic 19 raffles. 20 (3) One large raffle, including an electronic raffle, 21 each calendar year during the two-year period, subject to the 22 requirements of section 99B.24. 23 (4) Up to three bingo occasions per week and up to fifteen 24 bingo occasions per month. 25 (5) One game night each calendar year during the two-year 26 period, subject to the requirements of section 99B.26. 27 3. One-year qualified organization raffle license. 28 a. The license fee for a one-year qualified organization 29 raffle license is one hundred fifty dollars. 30 b. A qualified organization issued a one-year qualified 31 organization raffle license may conduct the following 32 activities: 33 (1) An unlimited number of very small raffles and an 34 unlimited number of small raffles. 35 -25- LSB 1314XD (11) 86 ec/nh 25/ 63

S.F. _____ H.F. _____ (2) Up to eight large raffles with each large raffle 1 conducted in a different county during the one-year period, 2 subject to the requirements of section 99B.24. 3 (3) One game night during the one-year period, subject to 4 the requirements of section 99B.26. 5 4. One hundred eighty-day qualified organization raffle 6 license. 7 a. The license fee for a one hundred eighty-day qualified 8 organization raffle license is seventy-five dollars. 9 b. A qualified organization issued a one hundred eighty-day 10 qualified organization raffle license may conduct the following 11 activities: 12 (1) An unlimited number of very small raffles and an 13 unlimited number of small raffles. 14 (2) One large raffle during the period of one hundred eighty 15 days, subject to the requirements of section 99B.24. 16 (3) One game night during the period of one hundred eighty 17 days, subject to the requirements of section 99B.26. 18 5. Ninety-day qualified organization raffle license. 19 a. The license fee for a ninety-day qualified organization 20 raffle license is forty dollars. 21 b. A qualified organization issued a ninety-day qualified 22 organization raffle license may conduct the following 23 activities: 24 (1) An unlimited number of very small raffles and an 25 unlimited number of small raffles. 26 (2) One large raffle during the period of ninety days, 27 subject to the requirements of section 99B.24. 28 (3) One game night during the period of ninety days, subject 29 to the requirements of section 99B.26. 30 6. Fourteen-day qualified organization license. 31 a. The license fee for a fourteen-day qualified organization 32 license is fifteen dollars. 33 b. A qualified organization issued a fourteen-day qualified 34 organization license may conduct the following activities: 35 -26- LSB 1314XD (11) 86 ec/nh 26/ 63

S.F. _____ H.F. _____ (1) Unlimited games of skill or games of chance except for 1 bingo. 2 (2) An unlimited number of very small raffles and an 3 unlimited number of small raffles. 4 (3) One large raffle during the period of fourteen days, 5 subject to the requirements of section 99B.24. 6 (4) Two bingo occasions during the period of fourteen days 7 with no limit on the number of bingo games or the number of 8 hours played during each designated bingo day. Bingo occasions 9 conducted pursuant to a fourteen-day qualified organization 10 license do not count toward the fifteen bingo occasions per 11 month authorized for a two-year qualified organization license. 12 (5) One game night during the period of fourteen days, 13 subject to the requirements of section 99B.26. 14 7. Qualified organizations —— school provisions. A school 15 district or a public or nonpublic school may be issued a 16 qualified organization license under this section subject to 17 the following additional restrictions: 18 a. The application for a license shall be authorized by 19 the board of directors of a school district for public schools 20 within that district, or the policymaking body of a nonpublic 21 school for a nonpublic school. 22 b. Activities authorized by the license may be held at 23 bona fide school functions such as carnivals, fall festivals, 24 bazaars, and similar events. 25 c. Each school shall obtain a license pursuant to this 26 section prior to permitting the games or activities on the 27 premises of that school. 28 d. The board of directors of a public school district 29 may also be issued a license under this section. A board 30 of directors of a public school district shall not spend or 31 authorize the expenditure of public funds for the purpose of 32 purchasing a license. 33 e. Upon written approval by the board of directors of a 34 school district for public schools within that district or 35 -27- LSB 1314XD (11) 86 ec/nh 27/ 63

S.F. _____ H.F. _____ the policymaking body of a nonpublic school, the license may 1 be used by any school group or parent support group in the 2 district or at the nonpublic school to conduct activities 3 authorized by this section. The board of directors or 4 policymaking body shall not authorize a school group or parent 5 support group to use the license to conduct more than two 6 events in a calendar year. 7 8. Qualified organizations —— miscellaneous provisions. A 8 political party or party organization may contract with other 9 qualified organizations to conduct the games of skill, games 10 of chance, and raffles which may lawfully be conducted by the 11 political party or party organization. A licensed qualified 12 organization may promote the games of skill, games of chance, 13 and raffles which it may lawfully conduct. 14 Sec. 28. NEW SECTION . 99B.13A Licensed qualified 15 organizations —— general requirements. 16 A qualified organization licensed pursuant to section 17 99B.12B shall, as a condition of licensure under section 18 99B.12B, comply with the requirements of this section. 19 1. Authorized gambling activities —— display of license. A 20 licensed qualified organization may only conduct gambling 21 activities as authorized by the license and shall prominently 22 display the license in the playing area where the gambling 23 activities are conducted. 24 2. Location requirements. 25 a. Gambling activities, as authorized by the type of 26 license, may be conducted on premises owned, leased, or rented 27 by the licensee. The amount imposed and collected for rental 28 or lease of such premises shall not be a percentage of, or 29 otherwise related to, the amount of the receipts for the 30 authorized gambling activities. 31 b. A gambling activity shall not take place on a gaming 32 floor, as defined in section 99F.1, licensed by the state 33 racing and gaming commission created in section 99D.5. 34 3. Participation requirements. 35 -28- LSB 1314XD (11) 86 ec/nh 28/ 63

S.F. _____ H.F. _____ a. A person shall not receive or have any fixed or 1 contingent right to receive, directly or indirectly, any 2 profit, remuneration, or compensation from or related to a 3 gambling activity conducted by a licensee, except any amount 4 which the person may win as a participant on the same basis as 5 the other participants. 6 b. The price to participate in a gambling activity, 7 including any discounts for the gambling activity, shall be the 8 same for each participant during the course of the gambling 9 activity. 10 c. The person conducting the gambling activity shall not 11 participate in the game. 12 4. Gambling activity requirements. 13 a. A gambling activity shall not be operated on a build-up 14 or pyramid basis. 15 b. Bookmaking shall not be allowed. 16 c. Concealed numbers or conversion charts shall not be used 17 in conducting any gambling activity. 18 d. A gambling activity shall not be adapted with any control 19 device to permit manipulation of the gambling activity by 20 the operator in order to prevent a player from winning or to 21 predetermine who the winner will be. 22 e. The object of the gambling activity must be attainable 23 and possible to perform under the rules stated from the playing 24 position of the player. 25 f. The gambling activity shall be conducted in a fair and 26 honest manner. 27 g. Rules for each gambling activity shall be posted. 28 h. Casino-style games shall only be allowed during a game 29 night as specified under section 99B.26 or during card game 30 tournaments under section 99B.7B. 31 Sec. 29. Section 99B.14, Code 2015, is amended to read as 32 follows: 33 99B.14 License denial, suspension, and revocation. 34 1. The department may deny, suspend, or revoke a license 35 -29- LSB 1314XD (11) 86 ec/nh 29/ 63

S.F. _____ H.F. _____ if the department finds that an applicant, licensee, or an 1 agent of the licensee violated or permitted a violation of 2 a provision of this chapter or a departmental rule adopted 3 pursuant to chapter 17A , or for any other cause for which 4 the director of the department would be or would have 5 been justified in refusing to issue a license, or upon the 6 conviction of a person of a violation of this chapter or a 7 rule adopted under this chapter which occurred on the licensed 8 premises. However, the denial, suspension, or revocation of 9 one type of gambling license does not require, but may result 10 in, the denial, suspension, or revocation of a different type 11 of gambling license held by the same licensee. In addition, a 12 2. A person whose license is revoked under this section who 13 is a person for which whom a class “A”, class “B”, class “C”, 14 or class “D” liquor control license has been issued pursuant 15 to chapter 123 shall have the person’s liquor control license 16 suspended for a period of fourteen days in the same manner as 17 provided in section 123.50, subsection 3 , paragraph “a” . In 18 addition, a 19 3. A person whose license is revoked under this section 20 who is a person for which whom only a class “B” or class “C” 21 beer permit has been issued pursuant to chapter 123 shall have 22 the person’s class “B” or class “C” beer permit suspended for 23 a period of fourteen days in the same manner as provided in 24 section 123.50, subsection 3 , paragraph “a” . 25 2. 4. The process for denial, suspension, or revocation 26 of a license shall commence by delivering to the applicant 27 or licensee by certified mail, return receipt requested, or 28 by personal service a notice , by means authorized by section 29 17A.18, setting forth the particular reasons for such action. 30 a. If a written request for a hearing is not received within 31 thirty days after the mailing or service of the delivery of 32 notice as provided in this subsection , the denial, suspension, 33 or revocation of a license shall become effective pending a 34 final determination by the department. The determination 35 -30- LSB 1314XD (11) 86 ec/nh 30/ 63

S.F. _____ H.F. _____ involved in the notice may be affirmed, modified, or set aside 1 by the department in a written decision. 2 b. If a request for a hearing is timely received by the 3 department, the applicant or licensee shall be given an 4 opportunity for a prompt and fair hearing before the department 5 and the denial, suspension, or revocation shall be deemed 6 suspended until the department makes a final determination. 7 However, the director may suspend a license prior to a hearing 8 if the director finds that the public integrity of the licensed 9 activity is compromised or there is a risk to public health, 10 safety, or welfare. In addition, at any time during or prior 11 to the hearing the department may rescind the notice of the 12 denial, suspension, or revocation upon being satisfied that the 13 reasons for the denial, suspension, or revocation have been 14 or will be removed. On the basis of any such hearing, the 15 determination involved in the notice may be affirmed, modified, 16 or set aside by the department in a written decision. 17 3. 5. A copy of the final decision of the department shall 18 be sent by electronic mail or certified mail, with return 19 receipt requested, or served personally upon the applicant 20 or licensee. The applicant or licensee may seek judicial 21 review in accordance with the terms of the Iowa administrative 22 procedure Act, chapter 17A . 23 4. 6. The procedure governing hearings authorized by this 24 section shall be in accordance with the rules promulgated by 25 the department and chapter 17A . 26 5. 7. If the department finds cause for denial of a 27 license, the applicant may not reapply for the same license 28 for a period of two years. If the department finds cause 29 for suspension, the license shall be suspended for a period 30 determined by the department. If the department finds cause 31 for revocation, the license shall be revoked for a period not 32 to exceed two years. 33 Sec. 30. NEW SECTION . 99B.14A Distribution of proceeds —— 34 licensed qualified organizations. 35 -31- LSB 1314XD (11) 86 ec/nh 31/ 63

S.F. _____ H.F. _____ 1. A licensed qualified organization shall certify 1 that the receipts from all charitable gambling conducted 2 by the organization under this chapter, less reasonable 3 expenses, charges, fees, taxes, and deductions, either will 4 be distributed as prizes to participants or will be dedicated 5 and distributed for educational, civic, public, charitable, 6 patriotic, or religious uses. Reasonable expenses, charges, 7 fees, taxes other than the state and local sales tax, and 8 deductions allowed by the department shall not exceed forty 9 percent of net receipts. 10 2. A licensed qualified organization shall dedicate and 11 distribute the balance of the net receipts received within 12 a calendar year and remaining after deduction of reasonable 13 expenses, charges, fees, taxes, and deductions allowed by 14 this chapter, before the annual report required under section 15 99B.16A is due. 16 a. A person desiring to hold the net receipts for a period 17 longer than permitted under this subsection shall apply to the 18 department for special permission and upon good cause shown the 19 department may grant the request. 20 b. If permission is granted to hold the net receipts, 21 the person shall, as a part of the annual report required by 22 section 99B.16A, report the amount of money being held and all 23 expenditures of the funds. This report shall be filed even if 24 the person no longer holds a gambling license. 25 3. Proceeds coming into the possession of a person under 26 this section are deemed to be held in trust for payment 27 of expenses and dedication to educational, civic, public, 28 charitable, patriotic, or religious uses as required by this 29 section. 30 4. A licensed qualified organization or agent of the 31 organization who willfully fails to dedicate the required 32 amount of proceeds to educational, civic, public, charitable, 33 patriotic, or religious uses as required by this section 34 commits a fraudulent practice under chapter 714. 35 -32- LSB 1314XD (11) 86 ec/nh 32/ 63

S.F. _____ H.F. _____ 5. Proceeds distributed to another charitable organization 1 to satisfy the sixty percent dedication requirement shall not 2 be used by the donee to pay any expenses in connection with the 3 conducting of any gambling activity by the donor organization, 4 or for any use that would not constitute a valid dedication 5 under this section. 6 Sec. 31. Section 99B.15, Code 2015, is amended by striking 7 the section and inserting in lieu thereof the following: 8 99B.15 Penalties. 9 In addition to any other penalty specified in this chapter, 10 the following penalties shall apply: 11 1. A person who knowingly fails to comply with the 12 requirements of this chapter and the rules adopted pursuant to 13 chapter 17A commits a serious misdemeanor. 14 2. A person who intentionally files a false or fraudulent 15 report or application as required by this chapter commits a 16 fraudulent practice under chapter 714. 17 Sec. 32. NEW SECTION . 99B.15A Prizes awarded by licensed 18 qualified organizations. 19 1. Unless otherwise provided, a prize awarded by a licensed 20 qualified organization shall comply with the following 21 requirements: 22 a. Only merchandise prizes whose value does not exceed ten 23 thousand dollars may be awarded for games of skill and games 24 of chance. If a prize consists of more than one item, unit, or 25 part, the aggregate value of all items, units, or parts shall 26 not exceed ten thousand dollars. 27 b. A merchandise prize shall not be repurchased. 28 c. No prize shall be displayed which cannot be won. 29 d. A cash prize may only be awarded in bingo and raffles. 30 e. A prize shall be distributed on the day the prize is won, 31 except that if the winner is not present, notification to the 32 winner shall be made as soon as practical. 33 2. A licensed qualified organization awarding a prize 34 for bingo is subject to the restrictions provided in section 35 -33- LSB 1314XD (11) 86 ec/nh 33/ 63

S.F. _____ H.F. _____ 99B.21A. A licensed qualified organization awarding a prize 1 for a raffle is subject to the restrictions provided in section 2 99B.24. 3 Sec. 33. NEW SECTION . 99B.16A Records and reports —— 4 licensed qualified organization. 5 1. A qualified organization licensed pursuant to section 6 99B.12B, unless otherwise provided, shall maintain proper 7 books of account and records showing, in addition to any other 8 information required by the department, the following: 9 a. Gross receipts and the amount of the gross receipts 10 taxes collected or accrued with respect to gambling activities 11 conducted by the licensed qualified organization. 12 b. All expenses, charges, fees, and other deductions. 13 c. The cash amounts, or the cost to the licensee of goods 14 or other noncash valuables, distributed to participants in the 15 licensed activity. 16 d. The amounts dedicated and the date and name and address 17 of each person to whom distributed. 18 2. The books of account and records shall be made available 19 to the department or a law enforcement agency for inspection at 20 reasonable times, with or without notice. A failure to permit 21 inspection is a serious misdemeanor. 22 3. A licensed qualified organization required to maintain 23 records shall submit an annual report to the department on 24 forms furnished by the department. The annual report shall be 25 submitted by January 31 of each year for the prior calendar 26 year period of January 1 through December 31. 27 Sec. 34. Section 99B.17, Code 2015, is amended by striking 28 the section and inserting in lieu thereof the following: 29 99B.17 Allowable forms for payment. 30 1. Social gambling, registered amusement devices, and 31 amusement concessions not at a permanent location, require 32 payment solely by cash. 33 2. Except as provided by subsection 1, a participant in 34 an activity authorized by this chapter may make payment by 35 -34- LSB 1314XD (11) 86 ec/nh 34/ 63

S.F. _____ H.F. _____ cash, personal check, money order, bank check, cashier’s check, 1 electronic check, debit card, or credit card. 2 3. The department shall adopt rules setting minimum 3 standards to ensure compliance with applicable federal law and 4 for the protection of personal information consistent with 5 payment card industry compliance regulations. 6 Sec. 35. Section 99B.21, Code 2015, is amended to read as 7 follows: 8 99B.21 Tax on prizes. 9 All prizes awarded pursuant to a gambling activity under 10 this chapter are Iowa earned income and are subject to state 11 and federal income tax laws. A person conducting a game of 12 skill, game of chance, bingo, or a raffle shall deduct state 13 income taxes, pursuant to section 422.16, subsection 1 , from a 14 cash prize awarded to an individual. An amount deducted from 15 the prize for payment of a state tax shall be remitted to the 16 department of revenue on behalf of the prize winner. 17 Sec. 36. NEW SECTION . 99B.21A Bingo. 18 A licensed qualified organization shall comply with the 19 requirements of this section for the purposes of conducting 20 bingo at a bingo occasion. 21 1. Operational requirements. 22 a. A bingo occasion shall not last for longer than four 23 consecutive hours. 24 b. Only one licensed qualified organization may conduct 25 bingo occasions within the same structure or building. 26 c. A licensed qualified organization shall not conduct or 27 offer free bingo games. 28 2. Prize requirements. 29 a. A cash or merchandise prize may be awarded in the game of 30 bingo. 31 b. A cash prize shall not exceed two hundred fifty dollars 32 per game of bingo. 33 c. A merchandise prize may be awarded in the game of bingo, 34 but the actual retail value of the prize, or if the prize 35 -35- LSB 1314XD (11) 86 ec/nh 35/ 63

S.F. _____ H.F. _____ consists of more than one item, unit, or part, the aggregate 1 retail value of all items, units, or parts, shall not exceed 2 two hundred fifty dollars in value. 3 d. A jackpot bingo game may be conducted twice during any 4 twenty-four-hour period in which the prize may begin at not 5 more than five hundred dollars in cash or actual retail value 6 of merchandise prizes and may be increased by not more than two 7 hundred dollars after each bingo occasion to a maximum prize 8 of one thousand dollars for the first jackpot bingo game and 9 two thousand five hundred dollars for the second jackpot bingo 10 game. 11 3. Equipment requirements. 12 a. A licensed qualified organization conducting bingo shall 13 purchase bingo equipment and supplies only from a manufacturer 14 or distributor licensed by the department. 15 b. A licensed qualified organization may lease electronic 16 bingo equipment from a manufacturer or distributor licensed 17 by the department for the purposes of aiding individuals with 18 disabilities during a bingo occasion. 19 4. Accounting requirements. A qualified organization 20 conducting bingo occasions under a two-year qualified 21 organization license and expecting annual gross receipts of 22 more than ten thousand dollars shall establish and maintain one 23 regular checking account designated the “bingo account” and may 24 also maintain one or more interest-bearing savings accounts 25 designated as “bingo savings account” . The accounts shall be 26 maintained in a financial institution in Iowa. 27 a. Funds derived from the conduct of bingo, less the 28 amount awarded as cash prizes, shall be deposited in the bingo 29 account. 30 (1) No other funds except limited funds of the organization 31 deposited to pay initial or unexpected emergency expenses shall 32 be deposited in the bingo account. 33 (2) Deposits shall be made no later than the next business 34 day following the day of the bingo occasion on which the 35 -36- LSB 1314XD (11) 86 ec/nh 36/ 63

S.F. _____ H.F. _____ receipts were obtained. 1 b. Payments shall be paid from the bingo account only for 2 the following purposes: 3 (1) The payment of reasonable expenses permitted under 4 section 99B.14A, subsection 1, incurred and paid in connection 5 with the conduct of bingo. 6 (2) The disbursement of net proceeds derived from the 7 conduct of bingo for educational, civic, public, charitable, 8 patriotic, or religious uses as required by section 99B.14A, 9 subsection 1. 10 (3) The transfer of net proceeds derived from the conduct 11 of bingo to a bingo savings account pending disbursement for 12 educational, civic, public, charitable, patriotic, or religious 13 uses. 14 (4) To withdraw initial or emergency funds deposited under 15 paragraph “a” . 16 (5) To pay prizes if the qualified organization decides to 17 pay prizes by check rather than cash. 18 c. Except as permitted by paragraph “a” , gross receipts 19 derived from the conduct of bingo shall not be commingled with 20 other funds of the licensed qualified organization. Except as 21 permitted by paragraph “b” , subparagraphs (3) and (4), gross 22 receipts shall not be transferred to another account maintained 23 by the licensed qualified organization. 24 Sec. 37. NEW SECTION . 99B.24 Raffles. 25 1. General provisions. A licensed qualified organization 26 may conduct a raffle as permitted by the applicable license and 27 in accordance with the following requirements: 28 a. The winner of a raffle shall not be required to be 29 present to win. 30 b. If the winner is not present to win, notification to the 31 winner shall be made as soon as practical. 32 c. A cash or merchandise prize may be awarded in a raffle. 33 If a merchandise prize is awarded, the actual retail value of 34 the prize, or if the prize consists of more than one item, 35 -37- LSB 1314XD (11) 86 ec/nh 37/ 63

S.F. _____ H.F. _____ unit, or part, the aggregate retail value of all items, units, 1 or parts, shall not exceed the maximum value allowed for that 2 raffle. 3 d. Calendar raffles and build-up or pyramid raffles are 4 prohibited. 5 e. If a raffle is conducted at a fair, the licensed 6 qualified organization shall receive written permission from 7 the sponsor of the fair to conduct the raffle. 8 f. A licensed qualified organization shall, regardless of 9 the number of licenses issued, only conduct one large raffle 10 per calendar year. However, a licensed qualified organization 11 issued a one-year qualified organization raffle license may 12 conduct up to eight large raffles with each large raffle 13 conducted in a different county during the one-year period. 14 2. Very large raffles. A licensed qualified organization 15 may conduct one very large raffle per calendar year subject to 16 the provisions of this subsection. 17 a. The licensed qualified organization shall submit a very 18 large raffle license application and a fee of one hundred 19 dollars to the department and be issued a license. 20 b. The licensed qualified organization shall prominently 21 display the license at the drawing area of the raffle. 22 c. If the raffle prize is real property, the real property 23 shall be acquired by gift or donation or shall have been owned 24 by the licensed qualified organization for a period of at least 25 five years. 26 d. The department shall conduct a special audit of a 27 very large raffle to verify compliance with the applicable 28 requirements of this chapter concerning raffles and very large 29 raffles. 30 e. The licensed qualified organization shall submit to the 31 department within sixty days of the very large raffle drawing a 32 cumulative report for the raffle on a form determined by the 33 department and one percent of the gross receipts from the very 34 large raffle. The one percent of the gross receipts shall be 35 -38- LSB 1314XD (11) 86 ec/nh 38/ 63

S.F. _____ H.F. _____ retained by the department to pay for the cost of the special 1 audit. 2 3. Very small raffles. A qualified organization may conduct 3 one very small raffle per calendar year without obtaining a 4 qualified organization license. A qualified organization 5 conducting a very small raffle as authorized by this subsection 6 shall comply with the requirements for conducting a raffle 7 by a licensed qualified organization, including payment of 8 applicable sales tax. However, a qualified organization 9 holding only one very small raffle per calendar year shall be 10 exempt from the reporting requirements in section 99B.16A. 11 Sec. 38. NEW SECTION . 99B.25 Electronic raffles. 12 1. A qualified organization with a two-year qualified 13 organization license may conduct a raffle using an electronic 14 raffle system, if the qualified organization complies with the 15 requirements of section 99B.24 and this section. 16 2. The licensed qualified organization shall only use 17 an electronic raffle system purchased from a manufacturer or 18 distributor licensed pursuant to section 99B.7A and certified 19 by an entity approved by the department. The electronic raffle 20 system may include stationary and portable or wireless raffle 21 sales units. 22 3. A licensed qualified organization shall hold only one 23 raffle using an electronic raffle system per calendar day. A 24 licensed qualified organization shall not hold a very large 25 raffle using an electronic raffle system and may hold only one 26 large raffle using an electronic raffle system per calendar 27 year. A large raffle conducted using an electronic raffle 28 system counts toward the limit of one large raffle per calendar 29 year under section 99B.24, subsection 1, paragraph “f” . 30 4. Except for a large raffle conducted using an electronic 31 raffle system, the prize for an electronic raffle shall be 32 limited to the amount allowed for a small raffle. 33 5. Entries for a raffle using an electronic raffle system 34 shall not be preprinted and shall be provided to the purchaser 35 -39- LSB 1314XD (11) 86 ec/nh 39/ 63

S.F. _____ H.F. _____ at the time of sale. 1 6. The electronic raffle receipt shall contain the 2 following information: 3 a. The name of the licensed qualified organization. 4 b. The license identification number of the qualified 5 organization. 6 c. The location, date, and time of the corresponding raffle 7 drawing. 8 d. The unique printed entry number, or multiple entry 9 numbers, of the raffle entry. 10 e. The price of the raffle entry. 11 f. An explanation of the prize to be awarded. 12 g. The statement, “Need not be present to win”, and the 13 contact information, including name, telephone number, and 14 electronic mail address, of the individual from the qualified 15 organization responsible for prize disbursements. 16 h. The date by which the prize shall be claimed which shall 17 be no fewer than fourteen days following the drawing. 18 7. Each electronic raffle entry shall reflect a single 19 unique printed entry number on the entry. 20 8. The licensed qualified organization shall use a manual 21 draw procedure for the electronic raffle which ensures a draw 22 number is randomly selected as a winner from the entries sold. 23 a. The winning entry shall be verified as a sold and valid 24 entry prior to awarding the prize. 25 b. The drawing of the winning entry shall be done in such 26 manner as to allow the purchasers to observe the drawing. 27 9. If the prize is not claimed, the licensed qualified 28 organization shall donate the unclaimed prize to an 29 educational, civic, public, charitable, patriotic, or religious 30 use. 31 10. The department may determine any other requirements for 32 conducting an electronic raffle by rule. 33 Sec. 39. NEW SECTION . 99B.26 Game nights. 34 1. A licensed qualified organization may conduct one game 35 -40- LSB 1314XD (11) 86 ec/nh 40/ 63

S.F. _____ H.F. _____ night per calendar year subject to the provisions of this 1 section. 2 2. A licensed qualified organization conducting a game 3 night may do any of the following during the game night: 4 a. Charge an entrance fee or a fee to participate in the 5 games. 6 b. Award cash or merchandise prizes in any games of 7 skill, games of chance, casino-style games, or card games in 8 an aggregate amount not to exceed ten thousand dollars and 9 no participant shall win more than a total of five thousand 10 dollars. 11 c. Allow participants at the game night that do not have 12 a bona fide social relationship with the sponsor of the game 13 night. 14 d. Allow participants to wager their own funds and pay an 15 entrance or other fee for participation, but participants shall 16 not be allowed to expend more than a total of two hundred fifty 17 dollars for all fees and wagers. 18 3. Except as provided by section 99B.62, a person or 19 organization that has not been issued a qualified organization 20 license under section 99B.12B shall not be authorized to 21 conduct a game night as authorized by this section. 22 Sec. 40. NEW SECTION . 99B.41 Definitions. 23 For purposes of this subchapter, unless the context 24 otherwise requires: 25 1. “Public place” means an indoor or outdoor area, whether 26 privately or publicly owned, to which the public has access 27 by right or by invitation, expressed or implied, whether by 28 payment of money or not, but not a place when used exclusively 29 by one or more individuals for a private gathering or other 30 personal purpose. 31 2. “Social gambling” means an activity in which social games 32 are played between individuals for any sum of money or other 33 property of any value. 34 3. “Social games” or “social game” means card and parlor 35 -41- LSB 1314XD (11) 86 ec/nh 41/ 63

S.F. _____ H.F. _____ games, including but not limited to poker, pinochle, pitch, gin 1 rummy, bridge, euchre, hearts, cribbage, dominoes, checkers, 2 chess, backgammon, pool, and darts. “Social games” do not 3 include casino-style games, except poker. 4 4. “Sports betting pool” or “pool” means a game in which 5 the participants select a square on a grid corresponding to 6 numbers on two intersecting sides of the grid and winners 7 are determined by whether the square selected corresponds to 8 numbers relating to an athletic event in the manner prescribed 9 by the rules of the game. 10 Sec. 41. NEW SECTION . 99B.42 Social gambling general 11 requirements. 12 1. Social gambling is lawful under section 99B.6, 99B.9, or 13 99B.12, when all of the following requirements are met: 14 a. The gambling occurs between two or more people who are 15 together for purposes other than social gambling. A social 16 relationship must exist beyond that apparent in the gambling 17 situation. 18 b. The gambling shall not take place on a gaming floor, 19 as defined in section 99F.1, licensed by the state racing and 20 gaming commission created in section 99D.5. 21 c. Concealed numbers or conversion charts are not used to 22 play any game. 23 d. A game is not adapted with any control device to permit 24 manipulation of the game by the operator in order to prevent a 25 player from winning or to predetermine who the winner will be. 26 e. The object of the game is attainable and possible to 27 perform under the rules stated from the playing position of the 28 player. 29 f. The game must be conducted in a fair and honest manner. 30 g. A person shall not receive or have any fixed or 31 contingent right to receive, directly or indirectly, any amount 32 wagered or bet or any portion of amounts wagered or bet, except 33 an amount which the person wins as a participant while playing 34 on the same basis as every other participant. 35 -42- LSB 1314XD (11) 86 ec/nh 42/ 63

S.F. _____ H.F. _____ h. A cover charge, participation charge, or other charge 1 shall not be imposed upon a person for the privilege of 2 participating in or observing the social gambling, and a 3 rebate, discount, credit, or other method shall not be used 4 to discriminate between the charge for the sale of goods 5 or services to participants in the social gambling and the 6 charge for the sale of goods or services to nonparticipants. 7 Satisfaction of an obligation into which a member of an 8 organization enters to pay at regular periodic intervals a 9 sum fixed by that organization for the maintenance of that 10 organization is not a charge which is prohibited by this 11 paragraph. 12 i. A participant shall not win or lose more than a total of 13 fifty dollars or equivalent consideration in one or more games 14 permitted by this subchapter at any time during any period of 15 twenty-four consecutive hours or over that entire period. 16 j. A participant is not participating as an agent of another 17 person. 18 k. A representative of the department or a law enforcement 19 agency is immediately admitted, upon request, to the premises 20 with or without advance notice. 21 l. A person shall not engage in bookmaking on the premises. 22 2. The social gambling licensee is strictly accountable for 23 compliance with this section. Proof of an act constituting 24 a violation is grounds for revocation of the license issued 25 pursuant to section 99B.6 or 99B.9 if the licensee permitted 26 the violation to occur when the licensee knew or had reasonable 27 cause to know of the act constituting the violation. 28 3. A participant in a social game or pool which is not in 29 compliance with this section shall only be subject to a penalty 30 under section 99B.15 if the participant has knowledge of or 31 reason to know the facts constituting the violation. 32 4. The social gambling licensee, and every agent of the 33 licensee who is required by the licensee to exercise control 34 over the use of the premises, who knowingly permits or engages 35 -43- LSB 1314XD (11) 86 ec/nh 43/ 63

S.F. _____ H.F. _____ in an act or omission which constitutes a violation of this 1 subchapter is subject to a penalty under section 99B.15. A 2 licensee has knowledge of an act or omission if any agent of 3 the licensee has knowledge of the act or omission. 4 Sec. 42. NEW SECTION . 99B.51 Definitions. 5 As used in this subchapter, unless the context otherwise 6 requires: 7 1. “Distributor” means a person who owns an electrical or 8 mechanical amusement device registered as provided in section 9 99B.53 that is offered for use at more than a single location 10 or premise. 11 2. “Manufacturer” means a person who originally produces, 12 or purchases an originally produced amusement device or 13 an originally produced motherboard that will be installed 14 into, an amusement device required to be registered under 15 this subchapter for the purposes of reselling such device or 16 motherboard. 17 3. “Owner” means a person who owns an operable amusement 18 device required to be registered under section 99B.53 at no 19 more than a single location or premise. 20 Sec. 43. NEW SECTION . 99B.52 Electrical or mechanical 21 amusement devices. 22 1. A person may own, possess, and offer for use at any 23 location an electrical or mechanical amusement device, except 24 for an amusement device required to be registered pursuant to 25 section 99B.53. If the provisions of this section and other 26 applicable provisions of this subchapter are complied with, the 27 use of an electrical or mechanical amusement device shall not 28 be deemed gambling. All electrical or mechanical amusement 29 devices shall comply with this section. 30 2. A prize of merchandise not exceeding fifty dollars in 31 value shall be awarded for use of an electrical or mechanical 32 amusement device. An electrical or mechanical amusement device 33 may be designed or adapted to award a prize of one or more 34 free games or portions of games without payment of additional 35 -44- LSB 1314XD (11) 86 ec/nh 44/ 63

S.F. _____ H.F. _____ consideration by the participant. 1 3. A prize of cash shall not be awarded for use of an 2 electrical or mechanical amusement device. 3 4. An amusement device shall not be designed or adapted to 4 cause or to enable a person to cause the release of free games 5 or portions of games when designated as a potential award for 6 use of the device, and shall not contain any meter or other 7 measurement device for recording the number of free games or 8 portions of games which are awarded. 9 5. An amusement device shall not be designed or adapted to 10 enable a person using the device to increase the chances of 11 winning free games or portions of games by paying more than is 12 ordinarily required to play the game. 13 6. An award given for the use of an amusement device shall 14 only be redeemed on the premises where the device is located 15 and only for merchandise sold in the normal course of business 16 for the premises. 17 7. The department may determine any other requirements 18 by rule. Rules adopted pursuant to this section shall be 19 formulated in consultation with affected state agencies and 20 industry and consumer groups. 21 Sec. 44. NEW SECTION . 99B.53 Electrical or mechanical 22 amusement devices —— registration required. 23 1. In addition to the requirements of section 99B.52, 24 an electrical or mechanical amusement device in operation 25 or distributed in this state that awards a prize where the 26 outcome is not primarily determined by skill or knowledge of 27 the operator shall be registered by the department as provided 28 in this section. 29 2. Except as provided in subsection 3, an electrical or 30 mechanical amusement device requiring registration shall be 31 located on premises for which a class “A”, class “B”, class 32 “C”, special class “C”, or class “D” liquor control license has 33 been issued pursuant to chapter 123. 34 3. a. An electrical or mechanical amusement device 35 -45- LSB 1314XD (11) 86 ec/nh 45/ 63

S.F. _____ H.F. _____ requiring registration may be located on premises for which a 1 class “B” or class “C” beer permit has been issued pursuant to 2 chapter 123, but the department shall not initially register 3 an electrical or mechanical amusement device to an owner or 4 distributor for a location for which a class “B” or class “C” 5 beer permit has been issued pursuant to chapter 123 on or after 6 April 28, 2004. 7 b. A distributor that owns an amusement device at a location 8 for which only a class “B” or class “C” beer permit has been 9 issued pursuant to chapter 123 shall not relocate an amusement 10 device registered as provided in this section to a location 11 other than a location for which a class “A”, class “B”, class 12 “C”, special class “C”, or class “D” liquor license has been 13 issued and shall not transfer, assign, sell, or lease an 14 amusement device registered as provided in this section to 15 another person for which only a class “B” or class “C” beer 16 permit has been issued pursuant to chapter 123 after April 28, 17 2004. 18 c. If ownership of the location changes, the class “B” 19 or class “C” beer permit does not lapse, and the device is 20 not removed from the location, the device may remain at the 21 location. 22 4. An electrical or mechanical amusement device required to 23 be registered and at a location for which only a class “B” or 24 class “C” beer permit has been issued pursuant to chapter 123 25 shall include on the device a security mechanism which prevents 26 the device from being operated by a person until action is 27 taken by the owner or owner’s designee to allow the person to 28 operate the device. 29 5. a. For a qualified organization, no more than four 30 electrical or mechanical amusement devices registered as 31 provided in this section shall be permitted or offered for use 32 in any single location or premises meeting the requirements of 33 this section. 34 b. For all other persons, no more than two electrical or 35 -46- LSB 1314XD (11) 86 ec/nh 46/ 63

S.F. _____ H.F. _____ mechanical amusement devices registered as provided in this 1 section shall be permitted or offered for use in any single 2 location or premises meeting the requirements of this section. 3 6. The total number of electrical or mechanical amusement 4 devices registered by the department under this section shall 5 not exceed six thousand nine hundred twenty-eight. 6 7. Each person owning an electrical or mechanical amusement 7 device in this state shall submit annually an application 8 form designated by the department that shall contain the 9 information required by the department by rule and a fee of 10 twenty-five dollars for each device required to be registered. 11 If approved, the department shall issue an annual registration 12 tag. 13 8. A new amusement device registration tag shall be 14 obtained if electronic or mechanical components have been 15 adapted, altered, or replaced and such adaptation, alteration, 16 or replacement changes the operational characteristics of 17 the amusement device including but not limited to the game 18 being changed. The amusement device shall not be placed 19 into operation prior to obtaining a new amusement device 20 registration tag. 21 9. An electrical or mechanical amusement device required 22 to be registered under this section shall only be leased or 23 purchased from a manufacturer or distributor registered with 24 the department under section 99B.10A. 25 10. A person owning or leasing an electrical or mechanical 26 amusement device required to be registered by this section 27 shall display the registration tag as required by rules adopted 28 by the department. 29 11. A person owning or leasing an electrical or mechanical 30 amusement device required to be registered by this section 31 shall not allow the electrical or mechanical amusement device 32 to be operated or made available for operation with an expired 33 registration. 34 12. A person or employee of a person owning or leasing 35 -47- LSB 1314XD (11) 86 ec/nh 47/ 63

S.F. _____ H.F. _____ an electrical or mechanical amusement device required to be 1 registered by this section shall not advertise or promote the 2 availability of the device to the public as anything other than 3 an electrical or mechanical amusement device pursuant to rules 4 adopted by the department. 5 13. A person owning or leasing an electrical or mechanical 6 amusement device required to be registered by this section 7 shall not relocate and place into operation an amusement device 8 in any location other than a location which has been issued 9 an appropriate liquor control license in good standing and to 10 which the device has been appropriately registered with the 11 department. 12 14. A counting mechanism which establishes the volume of 13 business of the electrical or mechanical amusement device shall 14 be included on each device required to be registered by this 15 section. The department and the department of public safety 16 shall have immediate access to the information provided by the 17 counting mechanism. 18 15. An electrical or mechanical amusement device required 19 to be registered as provided by this section shall not be a 20 gambling device, as defined in section 725.9, or a device that 21 plays poker, blackjack, or keno. 22 Sec. 45. NEW SECTION . 99B.54 Electrical or mechanical 23 amusement devices —— criminal penalties. 24 1. A person who violates any provision of section 99B.52 or 25 99B.53, except as specified in subsection 2, commits a serious 26 misdemeanor. 27 2. A person who violates any provision of section 99B.52, 28 subsection 2 or 6; or section 99B.53, subsection 4, 8, 10, 11, 29 12, or 13, shall be subject to the following: 30 a. For a first offense under an applicable subsection, the 31 person commits a simple misdemeanor, punishable as a scheduled 32 violation pursuant to section 805.8C, subsection 4, paragraph 33 “b” . 34 b. For a second or subsequent offense under the same 35 -48- LSB 1314XD (11) 86 ec/nh 48/ 63

S.F. _____ H.F. _____ applicable subsection, the person commits a serious 1 misdemeanor. 2 3. Notwithstanding any provision of section 99B.52 or 3 99B.53 to the contrary, the following shall apply: 4 a. An individual other than an owner or distributor of an 5 amusement device may operate an amusement device, whether or 6 not the amusement device is owned, possessed, or offered for 7 use in compliance with section 99B.52 or 99B.53. 8 b. A distributor shall not be liable for a violation of 9 section 99B.52 or 99B.53 unless the distributor or an employee 10 of the distributor intentionally violates a provision of 11 section 99B.52 or 99B.53. 12 Sec. 46. NEW SECTION . 99B.62 Game nights —— licensing 13 exceptions. 14 1. A person other than a qualified organization may lawfully 15 conduct a game night without a license, and may award cash or 16 merchandise prizes, under the following conditions: 17 a. A bona fide social, employment, or trade or professional 18 association relationship exists between the sponsors and the 19 participants. 20 b. The participants pay no consideration of any nature, 21 either directly or indirectly, to participate in the games. 22 c. All money, play money, or other items of no intrinsic 23 value which may be wagered are provided to the participant 24 free, and the sponsor conducting the game receives no 25 consideration, either directly or indirectly, other than 26 goodwill. 27 d. The games may be conducted at any location, except at a 28 fair or a location for which a license is required pursuant to 29 section 99B.3. 30 e. During the entire time activities permitted by this 31 subsection are being engaged in, no other gambling is engaged 32 in at the same location. 33 2. A person or an organization may sponsor one or more game 34 nights using play money for participation by students without 35 -49- LSB 1314XD (11) 86 ec/nh 49/ 63

S.F. _____ H.F. _____ the person or organization obtaining a license otherwise 1 required by this chapter if the person or organization obtains 2 prior approval for the game night from the board of directors 3 of the accredited public school or the authorities in charge of 4 the nonpublic school accredited by the state board of education 5 for whose students the game night is to be held. 6 3. A gambling device intended for use or used as provided in 7 this section is exempt from the provisions of section 725.9, 8 subsection 2. 9 Sec. 47. REPEAL. Sections 99B.2, 99B.4, 99B.5, 99B.7, 10 99B.8, 99B.9A, 99B.10, 99B.16, and 99B.18, Code 2015, are 11 repealed. 12 Sec. 48. LICENSED QUALIFIED ORGANIZATION —— INITIAL 13 ANNUAL REPORT. Notwithstanding any provision of section 14 99B.16A, subsection 3, to the contrary, the first annual 15 report submitted by a licensed qualified organization to the 16 department of inspections and appeals after July 1, 2015, shall 17 be submitted by January 31, 2017, and shall cover the period of 18 July 1, 2015, through December 31, 2016. 19 DIVISION II 20 COORDINATING AMENDMENTS 21 Sec. 49. Section 99.1A, unnumbered paragraph 2, Code 2015, 22 is amended to read as follows: 23 The provisions of this section do not apply to games of 24 skill, games of chance, or raffles social and charitable 25 gambling conducted pursuant to chapter 99B or to devices lawful 26 under section 99B.10 99B.52 or 99B.53 . 27 Sec. 50. Section 99D.8, unnumbered paragraph 1, Code 2015, 28 is amended to read as follows: 29 A qualifying organization, as defined in section 30 513(d)(2)(C) of the Internal Revenue Code, as defined in 31 section 422.3 , exempt from federal income taxation under 32 sections 501(c)(3), 501(c)(4), or 501(c)(5) of the Internal 33 Revenue Code or a nonprofit corporation organized under the 34 laws of this state, whether or not it is exempt from federal 35 -50- LSB 1314XD (11) 86 ec/nh 50/ 63

S.F. _____ H.F. _____ income taxation, which is organized to promote those purposes 1 enumerated in section 99B.7, subsection 3 , paragraph “b” 2 distribute funds for educational, civic, public, charitable, 3 patriotic, or religious uses, as defined in section 99B.1 , 4 or which regularly conducts an agricultural and educational 5 fair or exposition for the promotion of the horse, dog, or 6 other livestock breeding industries of the state, or an agency, 7 instrumentality, or political subdivision of the state, may 8 apply to the commission for a license to conduct horse or dog 9 racing. The application shall be filed with the administrator 10 of the commission at least sixty days before the first day 11 of the horse race or dog race meeting which the organization 12 proposes to conduct, shall specify the day or days when and 13 the exact location where it proposes to conduct racing, and 14 shall be in a form and contain information as the commission 15 prescribes. 16 Sec. 51. Section 99F.5, subsection 1, Code 2015, is amended 17 to read as follows: 18 1. A qualified sponsoring organization may apply to the 19 commission for a license to conduct gambling games on an 20 excursion gambling boat or gambling structure as provided in 21 this chapter . A person may apply to the commission for a 22 license to operate an excursion gambling boat. An operating 23 agreement entered into on or after May 6, 2004, between 24 a qualified sponsoring organization and an operator of an 25 excursion gambling boat or gambling structure shall provide for 26 a minimum distribution by the qualified sponsoring organization 27 for educational, civic, public, charitable, patriotic, or 28 religious uses as defined in section 99B.7, subsection 3, 29 paragraph “b” 99B.1 , that averages at least three percent 30 of the adjusted gross receipts for each license year. The 31 application shall be filed with the administrator of the 32 commission at least ninety days before the first day of the 33 next excursion season as determined by the commission, shall 34 identify the excursion gambling boat upon which gambling games 35 -51- LSB 1314XD (11) 86 ec/nh 51/ 63

S.F. _____ H.F. _____ will be authorized, shall specify the exact location where 1 the excursion gambling boat will be docked, and shall be in 2 a form and contain information as the commission prescribes. 3 The minimum capacity of an excursion gambling boat or gambling 4 structure is two hundred fifty persons. 5 Sec. 52. Section 99F.6, subsection 4, paragraph a, 6 subparagraph (2), Code 2015, is amended to read as follows: 7 (2) A qualified sponsoring organization licensed to operate 8 gambling games under this chapter shall distribute the receipts 9 of all gambling games, less reasonable expenses, charges, 10 taxes, fees, and deductions allowed under this chapter , as 11 winnings to players or participants or shall distribute the 12 receipts for educational, civic, public, charitable, patriotic, 13 or religious uses as defined in section 99B.7, subsection 3, 14 paragraph “b” 99B.1 . However, a licensee to conduct gambling 15 games under this chapter shall, unless an operating agreement 16 for an excursion gambling boat otherwise provides, distribute 17 at least three percent of the adjusted gross receipts for 18 each license year for educational, civic, public, charitable, 19 patriotic, or religious uses as defined in section 99B.7, 20 subsection 3, paragraph “b” 99B.1 . However, if a licensee 21 who is also licensed to conduct pari-mutuel wagering at a 22 horse racetrack has unpaid debt from the pari-mutuel racetrack 23 operations, the first receipts of the gambling games operated 24 within the racetrack enclosure less reasonable operating 25 expenses, taxes, and fees allowed under this chapter shall be 26 first used to pay the annual indebtedness. 27 Sec. 53. Section 331.304, subsection 2, Code 2015, is 28 amended by striking the subsection. 29 Sec. 54. Section 423.3, subsection 62, Code 2015, is amended 30 to read as follows: 31 62. The sales price from the sale of raffle tickets for a 32 raffle licensed and conducted at a fair pursuant to section 33 99B.5 99B.24 . 34 Sec. 55. Section 805.8C, subsection 4, Code 2015, is amended 35 -52- LSB 1314XD (11) 86 ec/nh 52/ 63

S.F. _____ H.F. _____ to read as follows: 1 4. Electrical and or mechanical amusement device violations. 2 a. For violations of legal age for operating an electrical 3 and or mechanical amusement device required to be registered as 4 provided in section 99B.10, subsection 1, paragraph “f” 99B.53 , 5 pursuant to section 99B.10C, subsection 1 , the scheduled fine 6 is two hundred fifty dollars. Failure to pay the fine by a 7 person under the age of eighteen shall not result in the person 8 being detained in a secure facility. 9 b. For first offense violations concerning electrical and 10 or mechanical amusement devices as provided in section 99B.10, 11 subsection 3 99B.54, subsection 2 , the scheduled fine is two 12 hundred fifty dollars. 13 DIVISION III 14 CODE EDITOR DIRECTIVES 15 Sec. 56. CODE EDITOR DIRECTIVE. 16 1. The Code editor is directed to make the following 17 transfers: 18 a. Section 99B.3 to section 99B.31. 19 b. Section 99B.5A to section 99B.22. 20 c. Section 99B.6 to section 99B.43. 21 d. Section 99B.7A to section 99B.32. 22 e. Section 99B.7B to section 99B.27. 23 f. Section 99B.9 to section 99B.44. 24 g. Section 99B.10A to section 99B.56. 25 h. Section 99B.10B to section 99B.55. 26 i. Section 99B.10C to section 99B.57. 27 j. Section 99B.10D to section 99B.58. 28 k. Section 99B.11 to section 99B.61. 29 l. Section 99B.11A, as enacted in this Act, to section 30 99B.11. 31 m. Section 99B.12 to section 99B.45. 32 n. Section 99B.12A to section 99B.23. 33 o. Section 99B.12B, as enacted in this Act, to section 34 99B.12. 35 -53- LSB 1314XD (11) 86 ec/nh 53/ 63

S.F. _____ H.F. _____ p. Section 99B.13 to section 99B.2. 1 q. Section 99B.13A, as enacted in this Act, to section 2 99B.13. 3 r. Section 99B.14 to section 99B.3. 4 s. Section 99B.14A, as enacted in this Act, to section 5 99B.14. 6 t. Section 99B.15 to section 99B.4. 7 u. Section 99B.15A, as enacted in this Act, to section 8 99B.15. 9 v. Section 99B.16A, as enacted in this Act, to section 10 99B.16. 11 w. Section 99B.17 to section 99B.5. 12 x. Section 99B.19 to section 99B.6. 13 y. Section 99B.20 to section 99B.7. 14 z. Section 99B.21 to section 99B.8. 15 aa. Section 99B.21A, as enacted in this Act, to section 16 99B.21. 17 2. The Code editor is directed to create seven new 18 subchapters in chapter 99B as follows: 19 a. Subchapter I shall be entitled “general provisions” and 20 include sections 99B.1 through 99B.10. 21 b. Subchapter II shall be entitled “qualified 22 organizations” and include sections 99B.11 through 99B.20. 23 c. Subchapter III shall be entitled “charitable gambling” 24 and include sections 99B.21 through 99B.30. 25 d. Subchapter IV shall be entitled “other activities 26 requiring licensure” and include sections 99B.31 through 27 99B.40. 28 e. Subchapter V shall be entitled “social gambling” and 29 include sections 99B.41 through 99B.50. 30 f. Subchapter VI shall be entitled “electrical or 31 mechanical amusement devices” and include sections 99B.51 32 through 99B.60. 33 g. Subchapter VII shall be entitled “activities not 34 requiring licensure” and include sections 99B.61 and 99B.62. 35 -54- LSB 1314XD (11) 86 ec/nh 54/ 63

S.F. _____ H.F. _____ 3. The Code editor may modify subchapter titles if necessary 1 and is directed to correct internal references in the Code as 2 necessary due to enactment of this section. 3 EXPLANATION 4 The inclusion of this explanation does not constitute agreement with 5 the explanation’s substance by the members of the general assembly. 6 This bill provides for the reorganization and modification 7 of provisions in Code chapter 99B governing games of skill or 8 chance, and raffles. 9 DIVISION I —— SOCIAL AND CHARITABLE GAMBLING PROVISIONS. 10 The bill makes a variety of changes to Code section 99B.1 11 (definitions). The bill eliminates definitions for 12 “authorized”, “controlling shareholder”, “eligible applicant”, 13 “posted”, and “unrelated entity”. New definitions for 14 “build-up or pyramid”, “calendar raffles”, “casino-style 15 games”, “gambling”, “game nights”, and “licensed charitable 16 organization” are added. In addition, current definitions 17 or descriptions in Code section 99B.7 for “qualified 18 organizations”, “charitable uses”, “educational, civic, public, 19 charitable, patriotic, or religious uses”, and “public uses” 20 are moved to Code section 99B.1. Existing definitions in Code 21 section 99B.1 are also modified. The definition for “amusement 22 concession” is amended to reference the games authorized and 23 not the location of where the games are played. “Bingo” is 24 amended to allow symbols or pictures to be used in playing 25 bingo and “bingo occasion” is amended to specify when a bingo 26 occasion ends. “Merchandise” is amended to provide that it 27 includes goods or services bought or sold in the regular course 28 of business and that a gift card not redeemable for cash is 29 considered merchandise. Other definitions in Code section 30 99B.1 are moved and made applicable to a subchapter of the 31 reorganized Code chapter. 32 Code section 99B.3, concerning amusement concessions, is 33 amended. The Code section, consistent with the change in the 34 definition of amusement concession, focuses on the type of 35 -55- LSB 1314XD (11) 86 ec/nh 55/ 63

S.F. _____ H.F. _____ gambling activity allowed and eliminates existing locational 1 requirements for the activity. The Code section is amended 2 to increase the maximum value of prizes from $50 to $100 and 3 increases the maximum cost to play a game from $3 to $5. The 4 Code section is amended to specify what constitutes and does 5 not constitute allowable repurchase of prizes. 6 Code section 99B.4, providing for permitted locations of 7 amusement concessions, is repealed. 8 Code section 99B.5 (raffles conducted at a fair) is 9 repealed. The bill consolidates provisions governing raffles 10 in new Code section 99B.24. 11 Code section 99B.6 (games where liquor or beer is sold) is 12 rewritten by the bill. Restrictions on the locations where the 13 games may be conducted are unchanged and allowable games are 14 defined as social gambling but remain unchanged. Provisions 15 of existing Code section 99B.6 applicable to lawful social 16 gambling that may occur between individuals or in public places 17 in addition to locations where liquor or beer is sold are moved 18 to new Code section 99B.42. 19 Code section 99B.7 (games conducted by qualified 20 organizations) is repealed. Several provisions of the Code 21 section are moved and modified in new Code sections governing 22 qualified organization licensing as provided in the bill. 23 Code section 99B.7A (manufacturers and distributors of 24 bingo equipment and supplies —— license) is amended to apply 25 to manufacturers and distributors of electronic raffle 26 systems. In addition, the amended Code section provides for 27 a single annual license for manufacturers and distributors of 28 $1,000 instead of a $1,000 manufacturers license and a $500 29 distributor license. 30 Code section 99B.7B (card game tournaments conducted by 31 qualified organizations representing veterans) is amended to 32 provide that a qualified organization representing veterans 33 shall apply for a qualified organization license under new Code 34 section 99B.12B to conduct a card game tournament. 35 -56- LSB 1314XD (11) 86 ec/nh 56/ 63

S.F. _____ H.F. _____ Code section 99B.8 (annual game night) is repealed. 1 Provisions governing licensed and unlicensed game nights are 2 included in new Code sections 99B.26 and 99B.62. 3 Code section 99B.9 (gambling in public places) is rewritten 4 by the bill. Current provisions relative to the license fee 5 and the public places in which social gambling may be conducted 6 are unchanged. Provisions of existing Code section 99B.9 7 applicable to lawful social gambling that may occur between 8 individuals or where liquor or beer is sold are moved to new 9 Code section 99B.42. 10 Code section 99B.9A, concerning exceptions for qualified 11 organizations to conduct bingo in certain locations, is 12 repealed. 13 Code section 99B.10, concerning electrical and mechanical 14 amusement devices, is repealed. New Code sections 99B.52, 15 99B.53, and 99B.54, all governing electrical or mechanical 16 amusement devices, include provisions contained in current Code 17 section 99B.10. 18 Code section 99B.10A, concerning registration of electrical 19 and mechanical amusement device manufacturers, distributors, 20 and for-profit owners, is amended by eliminating specific 21 reference to a manufacturer’s representation in the category of 22 persons required to be registered under this Code section. 23 Code section 99B.10B, is amended to allow service for 24 actions relative to denial, suspension, or revocation of a 25 registration of an electrical or mechanical amusement device by 26 means authorized by Code chapter 17A and to permit decisions 27 relative to these actions to be delivered by electronic mail. 28 Code sections 99B.10C and 99B.10D are amended to reflect 29 updated internal code references in Code chapter 99B. 30 Code section 99B.11, concerning bona fide contests, is 31 amended by providing categories that include current bona fide 32 contests and by then allowing contests that fit each of the 33 categories. The bill also allows, as an additional category, 34 trivia and trading card contests. 35 -57- LSB 1314XD (11) 86 ec/nh 57/ 63

S.F. _____ H.F. _____ New Code section 99B.11A provides definitions applicable 1 to qualified organizations and charitable gambling. New 2 definitions include “electronic bingo equipment” and several 3 categories of raffles based on the value of prizes that may be 4 awarded. The new raffle definitions are “large raffle”, “small 5 raffle”, “very large raffle”, and “very small raffle”. 6 Code section 99B.12 (games between individuals) is stricken 7 and rewritten. The changes primarily eliminate provisions 8 applicable to social gambling generally that are moved to new 9 Code section 99B.42. 10 New Code section 99B.12B provides for qualified organization 11 licenses. The Code section identifies provisions generally 12 applicable to all licenses issued to a qualified organization 13 and provides for the fees and applicable games that may be 14 conducted pursuant to a two-year, one-year, 180-day, 90-day, 15 and 14-day qualified organization license. Current provisions 16 in Code section 99B.7 relative to licenses for public and 17 nonpublic schools and for school districts are moved to this 18 new Code section. 19 New Code section 99B.13A provides for general requirements 20 applicable to any gambling conducted by a qualified 21 organization. The requirements include provisions on 22 displaying the license, where gambling activities under 23 the license may be conducted, participation in gambling 24 requirements, and game-specific requirements. 25 New Code section 99B.14A provides for the distribution of 26 proceeds by a licensed qualified organization. Most provisions 27 governing distribution of proceeds are moved from current Code 28 section 99B.7. However, the bill provides that reasonable 29 expenses that may be retained by a licensed qualified 30 organization shall not exceed 40 percent of net receipts. 31 Current law limits reasonable expenses to 25 percent of net 32 receipts. 33 Code section 99B.15, providing for the applicability of the 34 Code chapter and penalties, is stricken and rewritten. The 35 -58- LSB 1314XD (11) 86 ec/nh 58/ 63

S.F. _____ H.F. _____ Code section provides that a person who knowingly fails to 1 comply with the requirements of Code chapter 99B commits a 2 serious misdemeanor and that a person who intentionally files a 3 false or fraudulent report or application commits a fraudulent 4 practice under Code chapter 714. 5 New Code section 99B.15A provides general provisions 6 governing prizes awarded by a licensed charitable organization. 7 The Code section provides that merchandise prizes shall not 8 exceed $10,000 and cash can only be awarded in bingo and 9 raffles. 10 Code section 99B.16, concerning the criminal penalty for a 11 willful failure to maintain or submit records, is repealed. 12 Criminal penalties relative to reports and applications are 13 moved to Code section 99B.15. 14 Code section 99B.16A provides for records and reports 15 required of licensed qualified organizations. The Code section 16 requires an annual report to be submitted by January 31 for the 17 prior calendar year. The bill provides that the initial annual 18 report shall be submitted by January 31, 2017, for the period 19 beginning July 1, 2015, and ending December 31, 2016. 20 Code section 99B.17, providing that gambling on credit is 21 unlawful and including an exception, is rewritten by the bill. 22 The rewritten Code section allows payment by check, electronic 23 check, debit card, or credit card for gambling activities 24 under Code chapter 99B, except that only cash payments are 25 allowed for social gambling, registered amusement devices, and 26 amusement concessions not at a permanent location. 27 Code section 99B.18 (company games) is repealed. Games 28 authorized under this Code section are moved to new Code 29 section 99B.62 governing unlicensed game nights. 30 New Code section 99B.21A establishes requirements for a 31 licensed qualified organization conducting bingo. The Code 32 section provides operational requirements, prize requirements 33 as an exception to the general prize requirements in new 34 Code section 99B.15A, equipment requirements, and accounting 35 -59- LSB 1314XD (11) 86 ec/nh 59/ 63

S.F. _____ H.F. _____ requirements. Most of the accounting requirements are moved 1 from Code section 99B.2 and other requirements are moved from 2 Code section 99B.7. As far as prizes, the new Code section 3 limits cash prizes and merchandise prizes to $250 per game of 4 bingo instead of $100 as currently provided in Code section 5 99B.7. For jackpot bingo games, the new Code section allows 6 the prize to start at no more $500, instead of the current 7 $300. 8 New Code section 99B.24 establishes requirements for a 9 licensed qualified organization conducting a raffle. The 10 Code section establishes operational requirements relative 11 to conducting a raffle and authorizes a licensed qualified 12 organization to conduct one very large raffle per year upon 13 submission of an additional fee. The bill defines “very large 14 raffle” as a raffle where the cumulative value of cash and 15 prizes is more than $100,000 but not more than $200,000 or 16 the prize is real property. The bill also allows a qualified 17 organization to conduct one very small raffle per calendar 18 year without a license and without adhering to the reporting 19 requirements of new Code section 99B.16A. A “very small 20 raffle” is defined in the bill as a raffle where the cumulative 21 value of the prize or prizes is $1,000 or less and the value of 22 all entries sold is $1,000 or less. 23 New Code section 99B.25 allows a licensed qualified 24 organization with a two-year license to conduct a raffle 25 using an electronic raffle system. The bill allows only one 26 electronic raffle per calendar day and specifies how the 27 raffle is to be conducted and the information necessary on an 28 electronic raffle receipt. 29 New Code section 99B.26 allows a licensed qualified 30 organization to conduct one game night per calendar year. 31 Current provisions specific to game nights conducted by a 32 licensed qualified organization in Code section 99B.8 are moved 33 to this new Code section. In addition, the expanded prize 34 authorization for certain qualified organizations, such as for 35 -60- LSB 1314XD (11) 86 ec/nh 60/ 63

S.F. _____ H.F. _____ veterans and voluntary emergency services providers, in current 1 Code section 99B.8, subsection 6, is made applicable to all 2 licensed qualified organizations. 3 New Code section 99B.41 provides definitions specific to 4 social gambling. The definition for “social games” is moved 5 from current Code section 99B.12, and the definition for 6 “sports betting pool” is moved from the definition of “pool” 7 in current Code section 99B.6. 8 New Code section 99B.42 provides general requirements 9 applicable to social gambling. Requirements in current Code 10 sections 99B.6, 99B.9, and 99B.12 that are applicable to social 11 gambling regardless of location are generally moved to this new 12 Code section. 13 New Code section 99B.51 includes definitions of 14 “distributor”, “manufacturer”, and “owner”, for purposes of 15 electrical or mechanical amusement devices. The definitions 16 are moved from current Code section 99B.1. The definition 17 of “manufacturer” is also modified to include a person who 18 produces or purchases an originally produced motherboard. 19 New Code section 99B.52 provides general requirements 20 concerning all electrical or mechanical amusement devices. 21 Current provisions in Code section 99B.10, subsection 1, 22 paragraphs “a” through “d”, “k”, and “o” are moved to this new 23 Code section. 24 New Code section 99B.53 provides additional requirements for 25 electrical or mechanical amusement devices that are required 26 to be registered. Current provisions in Code section 99B.10, 27 subsection 1, governing amusement devices that are required to 28 be registered are moved to this new Code section. 29 New Code section 99B.54 establishes criminal penalties for 30 violations of provisions concerning electrical or mechanical 31 amusement devices. The criminal offenses are similar to 32 current provisions in Code section 99B.10, subsections 2 33 through 5. 34 New Code section 99B.62 allows game nights to be conducted 35 -61- LSB 1314XD (11) 86 ec/nh 61/ 63

S.F. _____ H.F. _____ without a license under certain circumstances. Current Code 1 section 99B.18, allowing company games, is moved to this new 2 Code section and is expanded to allow all persons to also hold 3 a casino night without a license subject to the requirements of 4 the new Code section. Current Code section 99B.8, subsection 5 4, concerning school game nights, is moved to this new Code 6 section. 7 DIVISION II —— COORDINATING AMENDMENTS. Code section 99.1A, 8 concerning nuisances, is amended to refer to Code chapter 99B 9 as social and charitable gambling and to refer to amusement 10 devices as authorized by new Code sections 99B.52 and 99B.53. 11 Code section 99D.8, concerning qualified organization for 12 purposes of horse or dog racing licenses, is amended to provide 13 that the purposes of the organization shall be for educational, 14 civic, public, charitable, patriotic, or religious uses, as 15 defined in Code section 99B.1. 16 Code sections 99F.5 and 99F.6 are amended to provide that 17 the definition of “educational, civic, public, charitable, 18 patriotic, or religious uses” is located in Code section 99B.1. 19 Code section 331.304, concerning county powers, is amended 20 by striking the provision concerning the power to determine 21 locations of amusement concessions in accordance with current 22 Code section 99B.4 as Code section 99B.4 is repealed by the 23 bill. 24 Code section 423.3, subsection 62, concerning exemptions 25 from sales and use taxes, is amended to provide that the 26 exemption is for raffles licensed pursuant to new Code section 27 99B.24 and only conducted at a fair. Current law references 28 the current Code section, repealed in the bill, that limited 29 the exemption to raffles conducted at a fair. 30 Code section 805.8C, subsection 4, concerning scheduled 31 violations relating to amusement devices, is amended to correct 32 internal references to the applicable amusement device. 33 DIVISION III —— CODE EDITOR DIRECTIVES. This division 34 directs the Code editor to transfer existing and new Code 35 -62- LSB 1314XD (11) 86 ec/nh 62/ 63

S.F. _____ H.F. _____ sections in Code chapter 99B. The division further directs the 1 Code editor to reorganize the Code chapter by creating seven 2 new subchapters, containing the transferred Code sections, 3 and entitled “general provisions”, “qualified organizations”, 4 “charitable gambling”, “other activities requiring licensure”, 5 “social gambling”, “electrical or mechanical amusement 6 devices”, and “activities not requiring licensure”. 7 -63- LSB 1314XD (11) 86 ec/nh 63/ 63