AN ACT

 

1Amending the act of December 19, 1988 (P.L.1262, No.156),
2entitled, as amended, "An act providing for the licensing of
3eligible organizations to conduct games of chance, for the
4licensing of persons to distribute games of chance, for the
5registration of manufacturers of games of chance, and for
6suspensions and revocations of licenses and permits;
7requiring records; providing for local referendum by
8electorate; and prescribing penalties," further providing for
<-9definitions, for major league sports drawing and for 
10licensing of eligible organizations to conduct games of 
<-11chance definition applicability, for the definitions of 
12"major league sports drawing" and "major league sports team," 
<-13definitions, for games of chance permitted, for distributor 
14licenses, for major league sports drawing, for club licensee, 
15for distribution of proceeds, for records and for raffle 
16tickets; providing for background checks; further providing 
17for enforcement; providing for tavern gaming and for a 
18transfer; and making an editorial change.

19The General Assembly of the Commonwealth of Pennsylvania
20hereby enacts as follows:

<-21Section 1. The definitions of "affiliated nonprofit
22organization," "major league sports drawing" and "major league
23sports team" in section 103 of act of December 19, 1988

1(P.L.1262, No.156), known as the Local Option Small Games of
2Chance Act, added October 24, 2012 (P.L.1462, No.184), are
3amended and the section is amended by adding definitions to
4read:

5Section 103. Definitions.

6The following words and phrases when used in this act shall
7have the meanings given to them in this section unless the
8context clearly indicates otherwise:

9* * *

10"Affiliated nonprofit organization." An organization
11established by or affiliated with a Major League Baseball,
12National Football League, National Hockey League, National
13Basketball Association or Major League Soccer team, or its
14affiliate, for the purpose of raising funds for charity, which
15is qualified for an exemption under section 501(c)(3) of the
16Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. §
17101(c)(3).

18* * *

19"Home game." A game of a major league sports team or its
20affiliate, including, but not limited to, a league-sponsored
21game, exhibition, regular season game, All-Star game, play-off
22game, and championship game, held at the home facility of the
23major league sports team or its affiliate.

24["Major league sports drawing." A 50/50 drawing conducted by 
25an affiliated nonprofit organization at a home game of a major 
26league sports team in which 50% of the money collected from 
27ticket sales from the drawing are offered as the prize and the 
28remaining 50% is retained by the affiliated nonprofit 
29organization sponsoring the drawing for distribution to 
30charitable organizations.]

1"Major league sports team." A professional team that is a
2member of Major League Baseball, the National Football League,
3the National Hockey League, the National Basketball Association
4or Major League Soccer.

5* * *

6"Professional sports drawing." A 50/50 drawing conducted by
7an affiliated nonprofit organization at a home game in which 50%
8of the money collected from ticket sales from the drawing is
9offered as the prize and the remaining 50% is retained by the
10affiliated nonprofit organization sponsoring the drawing for
11distribution to charitable organizations.

12* * *

13Section 2. Section 304.1 of the act, added October 24, 2012
14(P.L.1462, No.184), is amended to read:

15Section 304.1. [Major league] Professional sports drawing.

16(a) General rule.--A person may purchase one or more [major
17league] professional sports drawing tickets at a home game, and
18each ticket purchased shall represent one entry in the drawing
19for a winner. A single ticket shall be randomly chosen as the
20winner after a certain number of tickets are sold or a specified
21time period expires as designated by the affiliated nonprofit
22organization.

23(b) Frequency.--An affiliated nonprofit organization may
24conduct no more than one [major league] professional sports
25drawing per home game.

26(b.1) Sales restricted.--Tickets for a [major league]
27professional sports drawing may not be sold in any seating area
28designated as a family section.

29(c) Distribution.--The prize amount of a [major league]
30professional sports drawing shall be 50% of the total amount

1collected from the sale of [major league] professional sports
2drawing tickets. The other 50% of the total amount collected
3from the sale of [major league] professional sports drawing
4tickets shall be donated within seven days from the date of the
5drawing by the affiliated nonprofit organization conducting the
6[major league] professional sports drawing to a designated
7charitable organization for which the drawing was conducted.

8(d) Designated charitable organization.--The affiliated
9nonprofit organization conducting the [major league]
10professional sports drawing shall disclose to all ticket
11purchasers the designated charitable organization for which the
12[major league] professional sports drawing is being conducted.

13(e) Eligibility.--In order to receive proceeds from a [major
14league] professional sports drawing, a charitable organization
15must be in existence and fulfilling its purposes for at least
16two years prior to the drawing and shall be eligible for
17exemption under section 501(c)(3) of the Internal Revenue Code
18of 1986 (Public Law 99-514, 26 U.S.C. § 501(c)(3)). A political
19subdivision shall not qualify as a charitable organization under
20this section.

21(f) Unclaimed prizes.--Any [major league baseball]
22professional sports drawing prize remaining unclaimed by a
23winner at the end of the major league sports team's, or its
24affiliate's, season shall be donated within 30 days from the end
25of the season by the affiliated nonprofit organization to the
26designated charitable organization for which the [major league]
27professional sports drawing was conducted.

28(g) Applicability.--The limitations under sections 302,
29303(b), 308 and 704 shall not apply to a [major league]
30professional sports drawing.

1Section 3. Section 307(b.1)(5) of the act, amended October
224, 2012 (P.L.1462, No.184), is amended to read:

3Section 307. Licensing of eligible organizations to conduct
4games of chance.

5* * *

6(b.1) Location of games of chance.--

7* * *

8(5) For purposes of [major league] professional sports
9drawings, the facility at which a major league sports team,
10or its affiliate, conducts its games shall constitute a
11premises for purposes of this act.

12* * *

13Section 4. This act shall take effect in 60 days.

<-14Section 1. The introductory paragraph and the definitions of
15"major league sports drawing" and "major league sports team" in
16section 103 of the act of December 19, 1988 (P.L.1262, No.156),
17known as the Local Option Small Games of Chance Act, amended
18October 24, 2012 (P.L.1462, No.184), are amended to read:

<-19Section 1. Section 102 of the act of December 19, 1988 
20(P.L.1262, No.156), known as the Local Option Small Games of 
21Chance Act, amended February 2, 2012 (P.L.7, No.2), is amended 
22to read:

23Section 102. Legislative intent.

24The General Assembly hereby declares that the playing of
25games of chance for the purpose of raising funds, by certain
26nonprofit associations, for the promotion of charitable or civic
27purposes, is in the public interest. In some cases, the proceeds 
28from games of chance may be utilized to support certain 
29operating expenses of certain organizations.

30The General Assembly hereby declares that raising public

1funds from games of chance in taverns is also in the public
2interest.

3It is hereby declared to be the policy of the General
4Assembly that all phases of licensing, operation and regulation
5of games of chance be strictly controlled, and that all laws and
6regulations with respect thereto as well as all gambling laws
7should be strictly construed and rigidly enforced.

8The General Assembly recognizes the possibility of
9association between commercial gambling and organized crime, and
10wishes to discourage commercialization of games of chance,
11prevent participation by organized crime and prevent the
12diversion of funds from the purposes herein authorized.

13Section 1.1. The introductory paragraph and the definitions
14of "major league sports drawing," "major league sport team" and
15"proceeds" in section 103 of the act, amended or added February
162, 2012 (P.L.7, No.2) and October 24, 2012 (P.L.1462, No.184),
17are amended to read:

18Section 103. Definitions.

19The following words and phrases when used in this act shall, 
20except as provided under section 901, have the meanings given to
21them in this section unless the context clearly indicates
22otherwise:

23* * *

24"Major league sports drawing." [A 50/50 drawing conducted by
25an affiliated nonprofit organization at a home game of a major
26league sports team in which 50% of the money collected from
27ticket sales from the drawing are offered as the prize and the
28remaining 50% is retained by the affiliated nonprofit
29organization sponsoring the drawing for distribution to
30charitable organizations.] A 50/50 drawing conducted by a
 

1nonprofit affiliate of a major league sports team in accordance 
2with section 304.1.

3"Major league sports team." [A professional team that is a 
4member of Major League Baseball, the National Hockey League, the 
5National Basketball Association or Major League Soccer.] A 
6sports team <-or racing facility that is any of the following:

7(1) A member of Major League Baseball, the National
8Hockey League, the National Basketball Association, the
9National Football League or Major League Soccer.

10(2) A professional sports team affiliated with a team
11under paragraph (1).

12(3) Any other professional sports team that has a sports
13facility or an agreement with a sports facility to conduct
14home games at the facility.

<-15(4) A stadium, grandstand or bleacher at a closed-course
16motor facility where spectators are directly observing motor
17races with NASCAR, Indy, stock or drag racing cars.

18* * *

<-19"Proceeds." The difference between:

20(1) the actual gross revenue collected by a licensed
21eligible organization, or a licensee under Chapter 9, from a
22game of chance; and

23(2) the actual amount of prizes paid by a licensed
24eligible organization, or a licensee under Chapter 9, from a
25game of chance, plus the cost to purchase games of chance.

26* * *

27Section 1.2. Section 301 of the act, amended October 24, 
282012 (P.L.1462, No.184), is amended to read:

29Section 301. Games of chance permitted.

30Every eligible organization to which a license has been

1issued under the provisions of this chapter may conduct games of
2chance for the purpose of raising funds for public interest
3purposes. Except as provided in Chapter 5, all proceeds of a
4licensed eligible organization shall be used exclusively for
5public interest purposes, for the purchase of games of chance[,]
6or for the payment of the license fee [or for the payment of the
7fee for background checks], as required by this act.

8Section <-1.1 1.3. Section 304(a) of the act, amended February
92, 2012 (P.L.7, No.2), is amended to read:

10Section 304. Distributor licenses.

11(a) License required.--No person shall sell, offer for sale
12or furnish games of chance to eligible organizations licensed
13under this chapter or <-a licensee licensed under chapter 9 unless
14such person shall have obtained a distributor license as
15provided in this section.

16* * *

17Section <-1.2 1.4. Section 304.1(c) and (f) of the act, added 
18October 24, 2012 (P.L.1462, No.184), are amended and the section 
19is amended by adding subsections to read:

20Section 304.1. Major league sports drawing.

21* * *

<-22(b.2) Charitable event.--A major league sports drawing may
23be conducted by the affiliated nonprofit organization during a
24charitable event held within the same arena, stadium,
25grandstand, bleachers or other facility during a home game or
26car race of the major league sports team. Drawings may only be
27held within spectator areas within the arena, stadium,
28grandstand or bleachers where the home game or car race is being
29conducted and not at ancillary areas or facilities, including
30parking areas, restaurants and bars or areas outside the arena,

1stadium, grandstand or bleachers or areas where the sport is
2shown on remote electronic equipment.

3(c) Distribution.--The prize amount of a major league sports
4drawing shall be 50% of the total amount collected from the sale
5of major league sports drawing tickets. [The<-] Except as set 
6forth in subsection (c.1), the other 50% of the total amount
7collected from the sale of major league sports drawing tickets
8shall be donated within seven days from the date of the drawing
9by the affiliated nonprofit organization conducting the major
10league sports drawing to [a] one or more designated charitable
11[organization] organizations for which the drawing was
12conducted.

13(c.1) Use of funds.--

14(1) The affiliated nonprofit organization may utilize
15nonprize money collected for the following:

16(i) To employ or provide payment to individuals 18
17years of age or older to sell major league sports drawing
18tickets at a professional sporting event.

19(ii) For administrative expenses directly related to
20the conduct of the drawing under this section.

21(2) Authorized expenses under paragraph (1)(ii) may not
22exceed 2% of the total amount collected from the sale of
23major league sports drawing tickets.

24* * *

25(f) Unclaimed prizes.--Any major league [baseball] sports
26drawing prize remaining unclaimed by a winner at the end of the
27major league sports team's season shall be donated within 30
28days from the end of the season by the affiliated nonprofit
29organization to the designated charitable organization for which
30the major league sports drawing was conducted.

1* * *

2(h) Additional recordkeeping.--The department may require
3additional recordkeeping <-of or accountability measures for major
4league sports drawings.

5Section 2. Sections 501(a), 502(a) and (a.1) and 503 of the
6act, added February 2, 2012 (P.L.7, No.2), are amended to read:

7Section 501. Club licensee.

8(a) Report.--

9(1) [Beginning in [2013] 2014, a club licensee <-with 
10proceeds in excess of $30,000 in a calendar year shall submit
11[semiannual<-] annual reports to the department for the
12preceding [<-six-month] 12-month period on a form and in a
13manner prescribed by the department.<-] Beginning January 1, 
142014, and each January 1 thereafter, a club licensee that has 
15proceeds in excess of $30,000 in a calendar year shall submit 
16an annual report to the department for the preceding year on 
17a form and in a manner prescribed by the department.

18(1.1) The report under paragraph (1) shall include:

19(i) Prizes awarded as required under section 335 of
20the act of March 4, 1971 (P.L.6, No.2), known as the Tax
21Reform Code of 1971.

22(ii) Amounts expended for public interest purposes.

23(2) The report under paragraph (1) must be filed under
24oath or affirmation of an authorized officer of the club
25licensee<-[.

26(3) The report <-under paragraph (1)] and shall include
27all of the following information:

28(i) The proceeds received by the club licensee from
29each game of chance conducted, itemized by week.

30(ii) The amount of prizes paid from all games of

1chance, itemized by week.

2(iii) Other costs incurred related to the conduct of 
3games of chance.

4(iv) The verification of amounts distributed for 
5public interest purposes itemized under section 
6502(a)(1), itemized by the recipient.

7(v) An itemized list of expenditures made or amounts 
8retained and expenditures under section 502(a)(2).

9(vi) The address and the county in which the club 
10licensee is located.

11(vii) Other information or documentation required by 
12the department.

13* * *

14Section 502. Distribution of proceeds.

15(a) Distribution.--The proceeds from games of chance
16received by a club licensee shall be distributed as follows:

17(1) No less than [70%] 60% of the proceeds shall be paid
18to organizations for public interest purposes [in the
19calendar year in which] within one year of the <-date end of 
20the calendar year in which the proceeds were obtained.

21(2) No more than [30%] 40% of the proceeds obtained in a
22calendar year may be retained by a club licensee and used for
23the following operational expenses relating to the club
24licensee:

25(i) Real property taxes.

26(ii) Utility and fuel costs.

27(iii) Heating and air conditioning equipment or
28repair costs.

29(iv) Water and sewer costs.

30(v) Property or liability insurance costs.

1(vi) Mortgage payments.

2(vii) Interior and exterior repair <-and upkeep costs,
3including repair to parking lots <-and landscaping.

4(viii) New facility construction costs.

5(ix) Entertainment equipment, including television,
6video and electronic games.

7(x) Personnel, other than a bartender or individual
8who operates games of chance.

9[(x)] (xi) Other expenses adopted in regulation by
10the department.

11(a.1) Amounts retained.--Amounts retained by a club licensee
12under subsection (a)(2) shall be expended within [the same
13calendar year] one year <-from the time of the end of the calendar 
14year in which the proceeds were obtained unless the club
15licensee notifies the department that funds are being retained
16for a substantial public interest purchase or project.
17[Notification shall include a description of the purchase or
18project, the cost and the anticipated date of the purchase or
19project.]

20* * *

21Section 503. Records.

22A club licensee shall maintain records as required by this
23act or by the department, including invoices for games of chance
24purchased. Records necessary to <-[conduct an audit under section
25702(b)<-] enforce this act or to conduct random audits shall be
26made available to the [Bureau of Liquor Control Enforcement<-], 
27the department or any other entity authorized to enforce <-or 
28conduct audits under this act.

29Section 3. Section 504 of the act, added February 2, 2012
30(P.L.7, No.2), is repealed:

1[Section 504. Raffle tickets.

2A club licensee shall maintain records relating to the 
3printing or purchase of raffle tickets. Records shall include a 
4receipt or invoice from the place of purchase that shows the 
5cost and number or amount of tickets purchased.]

<-6Section 4. The act is amended by adding a section to read:

7Section 505.1. Background checks.

8Each application for a club license under this act submitted
9by an eligible organization which has proceeds in excess of
10$30,000 in a year shall include the results of a criminal
11history record information check obtained from the Pennsylvania
12State Police, as defined in 18 Pa.C.S. § 9102 (relating to
13definitions) and permitted by 18 Pa.C.S. § 9121(b) (relating to
14general regulations), for the executive officer and secretary of
15the eligible organization making the application for a club
16license or any other person required by the department.

17Section 5 4. Section <-702(c) 702(b) and (c) of the act,
18amended February 2, 2012 (P.L.7, No.2) and October 24, 2012
19(P.L.1462, No.184), <-is are amended to read:

20Section 702. Enforcement.

21* * *

<-22(b) Bureau of Liquor Control Enforcement.--If the licensee
23is a club licensee or a licensee under Chapter 9, the Bureau of
24Liquor Control Enforcement may enforce the provisions of this
25act in accordance with subsection (g). An administrative law
26judge under section 212 of the act of April 12, 1951 (P.L.90,
27No.21), known as the Liquor Code, may impose the penalties under
28subsection (d) following the issuance of a citation by the
29bureau.

30(c) Random audits.--The [Bureau of Liquor Control

1Enforcement] department shall conduct annual random audits of 5%
2of all club licensees.

3* * *

4Section <-6 5. The act is amended by adding a chapter to read:

5CHAPTER 9

6TAVERN GAMING

7Section 901. Scope of chapter.

8This chapter relates to tavern gaming.

9Section 902. Definitions.

10The following words and phrases when used in this chapter
11shall have the meanings given to them in this section unless the
12context clearly indicates otherwise:

<-13"Applicant." The person applying for a license under this
14chapter. The term includes each owner and officer of the
15restaurant licenses where tavern games will be conducted or of
16the license to conduct tavern games.

17"Board." The Pennsylvania Liquor Control Board.

18"Bureau." The Bureau of Investigations and Enforcement of
19the Pennsylvania Gaming Control Board.

<-20"Grocery store." An established place which:

21(1) primarily sells food, supplies for the table and
22food products for human consumption off the premises; and

23(2) has an area under one roof of at least 10,000 square
24feet.

25"License." A license to conduct tavern games under this
26chapter.

27"Licensee." A person that holds a license under this
28chapter.

<-29"Pull-tab." A single folded or banded ticket or a strip
30ticket or card with a face covered to conceal one or more

1numbers or symbols, where one or more of each set of tickets or
2cards has been designated in advance as a winner.

<-3"Net revenue." As follows:

4(1) For tavern games required to be purchased from a
5licensed distributor under this act, the difference between:

6(i) the face value, as indicated by the
7manufacturer, collectible by a licensee from a tavern
8game; and

9(ii) the maximum amount of prizes payable, as
10indicated by the manufacturer, by a licensee from a
11tavern game.

12(2) For tavern games not required to be purchased from a
13licensed distributor, the term has the same meaning as
14proceeds.

15"Restaurant licensee." A for-profit hotel, restaurant,
16privately owned public golf course, brew pub or micro brewery
<-17eating place licensed to sell liquor under the act of April 12,
181951 (P.L.90, No.21), known as the Liquor Code. <-The term does
19not include any of the following:

20(1) A grocery store.

21(2) A premises where the sale of liquid fuels or oil is
22conducted.

23"Tavern game." The conduct of pull-tab games, daily drawings
24or tavern raffles by a for-profit restaurant licensee <-in
25accordance with <-pursuant to a license issued under this chapter.

26"Tavern raffle." A raffle held <-in part for a charitable or
27public purpose in accordance with section 908.1.

28Section 903. Licenses.

29(a) Application.--A restaurant licensee may apply to the
30board for a license to conduct tavern games at a licensed

1premises in accordance with this chapter.

2(b) Information.--The application under subsection (a) shall
3include the following information<- regarding the applicant and
4all owners of the restaurant license:

5(1) The name, address and photograph <-of the applicant 
6and the proposed tavern gaming licensee.

<-7(2) A photograph of the applicant.

8(3) The proposed location of the conduct of tavern
9games.

10(4) <-(2) A current tax lien certificate issued by the
11department<-. and a certificate from the Department of Labor
12and Industry of payment of all workers' compensation and
13unemployment compensation owed.

14(5) (3) The details of any gaming, slot machine <-or any,
15casino<-, restaurant or proposed tavern gaming license applied
16for or in which the applicant or other owner has an interest.

<-17(6) Consent to conduct (4) Certified consent by the
18applicant, and each owner and officer of the restaurant
19licensee to a background investigation by the bureau.

<-20(7) The following relating to criminal information:

21(i) Disclosure of all arrests and all citations of
22the applicant and all owners of the restaurant license
23for nontraffic summary offenses. The information shall
24include all of the following:

25(A) A brief description of the circumstances
26surrounding the arrest of issuance of the citation.

27(B) The specific offense charged.

28(C) The ultimate disposition of the charge,
29including any dismissal, plea bargain, conviction,
30sentence, pardon, expungement or order of Accelerated

1Rehabilitative Disposition.

2(ii) No applicant shall be required to provide
3documentation relating to a summary offense. Failure of
4the board or the bureau to recover a record of a summary
5offense may not be grounds for denying an application.

<-6(5) Relating to criminal information, disclosure of all
7arrests and citations of the applicant for nontraffic summary
8offenses. The information shall include all of the following:

9(i) A brief description of the circumstances
10surrounding the arrest or issuance of the citation.

11(ii) The specific offense charged.

12(iii) The ultimate disposition of the charge,
13including any dismissal, plea bargain, conviction,
14sentence, pardon, expungement or order of Accelerated
15Rehabilitative Disposition.

16(6) Financial interests and transactions as required by
17the bureau.

<-18(8) (7) Any other information required by the
19department. <-board.

20(c) Duty of bureau.--The bureau shall conduct a background
21investigation of each applicant, the scope of which shall be
22determined by the bureau.

23(c) (d) Review.--Within six months of receipt of <-an
24application under subsection (a) <-the background investigation
25report from the bureau, the board shall approve or disapprove
26the application.

27(d) (e) Background investigation.--Every Each applicant <-and
28owner of a proposed license,<- including each owner and officer of
29the restaurant, restaurant licensee and proposed tavern gaming
30license, shall include information and documentation as required

1to establish the applicant's and each owner's <-personal and
2financial suitability, honesty and integrity. Information shall
3include:

4(1) Criminal history record information.

5(2) Financial background information.

6(3) Data investigation by the bureau.

7(4) Regulatory history before the board or other
8Commonwealth agency.

9(5) Other information required by the bureau.

10(e) (f) Personal interview.--If the bureau determines that <-a
11criminal history record warrants <-the results of the background
12report investigation warrant additional review of the
13individual, the bureau shall conduct a personal interview with
14the applicant and may request information <-and interviews from
<-15other personal or professional associates.

<-16(f) Cooperation.--The bureau shall conduct a background
17investigation of the applicant and all other owners of the
18restaurant license in cooperation with the board.

<-19(g) Cooperation.--The applicant shall cooperate with the
20bureau as requested during the conduct of the background
21investigation. Any refusal to provide the information required
22under this section or to consent to a background investigation
23shall result in the immediate denial of a license by the board.

24(g) (h) Costs.--The applicant <-and each owner shall reimburse
25the <-board and the bureau for the actual costs of conducting the
26background investigation. <-The board shall not approve an
27applicant that has not fully reimbursed the bureau for the
28investigation.

29(h) (i) Approval.--The bureau shall <-transmit the
30investigative report and may make a recommendation to the board.

1The board shall review the information obtained <-and the
2recommendation under this section to determine if the applicant
<-3and other owners of the license possess possesses the following:

4(1) Financial stability, integrity and responsibility.

5(2) Sufficient business experience and ability to
6effectively operate tavern games as part of the restaurant
7licensee's operator.

8(3) Character, honesty and integrity to <-be licensed to
9operate tavern games in a responsible and lawful manner.

10Section 904. Application.

11(a) Application fee.--An applicant shall pay <-an the board a
12nonrefundable application fee of $1,000.

<-13(b) Costs.--A restaurant licensee and any additional owners

<-14(b) Investigative fee.--An applicant shall pay an 
15investigative fee of $1,000 to the bureau.

16(c) Costs.--In addition to the fee under subsection (b), an 
17applicant and any owner and officer of the applicant shall pay 
18for the actual costs of a background investigation conducted by 
19the bureau <-that exceed the application fee. The bureau may:

20(1) Charge an estimated amount to be provided prior to
21the background investigation.

22(2) Submit for reimbursement from the applicant for <-the
23additional costs incurred in the background investigation.

<-24(d) Funds.--Funds collected under subsections (b) and (c)
25shall augment the funds appropriated to the Gaming Control Board
26under 4 Pa.C.S. (relating to amusements).

27Section 905. Approval.

28(a) Issuance.--Upon being satisfied that the requirements of
29section 903 have been met, the board may approve the application
30and issue <-an initial a tavern games license for a period of one

1year. The board may place conditions on the license as it deems
2appropriate.

3(b) Renewal.--A license shall be renewed annually. <-A license 
4renewal shall not require review of the bureau, unless requested 
5by the board.

6(c) Fee.--<-The license fee and renewal fee shall be $1,000.
7Upon approval, the applicant shall pay a $2,000 license fee to
8be deposited in the General Fund. The annual renewal fee shall
9be $1,000.

10(d) Entitlement.--Nothing under this chapter shall be
11construed to create an entitlement to a license by a person. The
12board shall have sole discretion to issue, renew, condition<-,
13suspend, revoke or deny a license based on the requirements of
14this chapter and whether the issuance <-is and maintenance of the
15license are in the best interests of the Commonwealth.

16(e) Nontransferability.--A license shall be a grant of
17privilege to conduct tavern games. A license may not be sold,
18transferred or assigned to any other person. A licensee may not
19pledge or otherwise grant a security interest in or lien on the
20license. The board shall have the sole discretion to issue,
21renew, condition or deny the issuance of a license.

22Section 906. Change in ownership.

23(a) Notice.--A licensee shall notify the board <-upon becoming
24aware of a <-proposed or contemplated change of ownership of the
25premises <-of the restaurant license or sale or transfer of the
26restaurant license.

27(b) Qualification.--The purchaser <-or transferee of the
28assets or premises of a licensee must independently qualify for
29a license, pay the license fee and undergo <-and pay fees and
30costs for a background investigation under section 903. <-A new

1license fee shall be paid upon the assignment and actual change
2of control or ownership of the license.

3Section 907. Prize limits.

4(a) Individual prize limit.--The maximum prize which may be
5awarded for any single chance shall be $2,000. No tavern game
6sold, offered for sale or furnished may contain, permit, depict
7or designate a prize having a prize limit in excess of $2,000.

8(b) Aggregate prize limit.--No more than $35,000 in prizes
9may be awarded from tavern games by a licensee in a seven-day
10period.

11Section 908. Bank account.

12A licensee shall maintain a bank account to hold the <-proceeds
13of net revenue from tavern games which shall be separate from
14all other funds belonging to the licensee. Account records shall
15show all expenditures and income and shall be retained by the
16licensee for at least two years.

17Section 908.1. Tavern raffle.

18The following shall apply to a tavern raffle:

19(1) No more than one tavern raffle may be held in a
20calendar month.

21(2) A tavern raffle must be held for a designated
22charitable purpose.

23(3) Each individual participating in the tavern raffle
24must be informed of the charitable purpose involved.

25(4) At least 50% of the <-proceeds net revenues from the
26tavern raffle shall be transmitted to the designated charity
27within seven days of the tavern raffle.

28(5) Any <-proceeds net revenues not transmitted under
29paragraph (4) shall be distributed as follows:

30(i) Sixty percent shall be paid to the Commonwealth.

1(ii) Forty percent may be retained by the licensee.

2Section 909. Distribution of proceeds.

3Beginning January 1, 2014, the <-proceeds net revenue from
4tavern games received by a licensee shall be distributed as
5follows:

6(1) Sixty percent of the <-proceeds net revenue obtained
7in any calendar year shall be paid to the Commonwealth.

8(2) Forty percent of the <-proceeds net revenue obtained
9in any calendar year may be retained by the licensee.

<-10Section 909.1. Tavern games tax.

11(a) Imposition.--There is imposed a tax of 60% of the net
12revenue from tavern games sold by a licensed distributor to a
13licensee within this Commonwealth.

14(b) Collection.--The tax imposed under subsection (a) must
15be collected by the licensed distributor from the licensee in an
16instance where the tavern game is required to be purchased from
17a licensed distributor under this act and must be paid over to
18the Commonwealth.

19(c) Other games.--In an instance where the tavern game is
20not required to be purchased from a licensed distributor under
21this act, a tax of 60% is imposed upon the net revenue from
22daily drawings and tavern raffles under section 908.1 and must
23be paid to the Commonwealth by the licensee.

24(d) Requirement to collect and remit.--Failure of a seller
25of tavern games to obtain a distributor's license does not
26relieve the seller from the requirement of collecting and
27remitting the tax imposed under this section.

28(e) Returns.--A licensee or licensed distributor subject to
29this article shall file with the department, upon a form
30prescribed by the department, a tavern games tax return. The

1return must be filed under oath or affirmation of an authorized
2officer of the licensee or licensed distributor reporting the
3net revenue and the tax due under this section in the prior
4calendar quarter for licensees and in the prior calendar month
5for licensed distributors. A return is due by the 20th day
6following the end of the reporting period. The return must set
7forth the following:

8(1) In the case of a licensed distributor, the total
9amount of net revenue for the tavern games sold to licensees
10in the prior calendar month, which must be calculated by
11indicating the number of each type of tavern game sold and
12the net revenue for each type of game.

13(2) In the case of a licensee, the amount of net revenue
14for the tavern games not purchased from a licensed
15distributor that the licensee operated in the prior calendar
16quarter.

17(3) Calculation of the tax due under this section.

18(4) For a licensee, the amount from tavern games
19distributed to a designated charity.

20(5) Other information required by the department.

21(f) Payment.--A licensee or licensed distributor subject to
22pay or collect the tax under this section shall remit the tax to
23the department when the return in subsection (e) is made.

24(g) Penalties and interest.--If a licensee or licensed
25distributor fails to file the return required under subsection
26(e) or fails to pay the tax imposed under subsection (a) or (c),
27the department may do the following:

28(1) assess the amount of tax due;

29(2) impose and assess an administrative penalty equal to
3010% of the tax due but unpaid for each quarter or fraction

1thereof that the tax remains unpaid together with interest at
2the rate established under section 806 of the act of April 9,
31929 (P.L.343, No.176), known as The Fiscal Code, on the tax
4from the time the tax became due. The penalty provided in
5this paragraph must be added to the tax and assessed and
6collected at the same time and in the same manner as a part
7of the tax. Unless otherwise specified, the tax must be
8assessed, collected and enforced by the department under the
9provisions of Article II of the act of March 4, 1971 (P.L.6,
10No.2), known as the Tax Reform Code of 1971;

11(3) notify the appropriate licensing authority that a 
12licensee has not filed returns or has not paid tax. The
13licensing authority may suspend or revoke a licensee's
14license; or

15(4) revoke a licensed distributor's license.

16(h) Funds held in trust.--The funds owed to the Commonwealth
17under this section shall be held in trust by a licensed
18distributor.

19(i) Deposit.--Beginning in fiscal year 2013-2014, the total
20amount of taxes imposed by this section shall be deposited in
21the General Fund.

22Section 910. Regulation.

23The department shall enforce all revenue provisions of this
24chapter and may promulgate and enforce regulations relating to
25the enforcement, collection of tax and imposition of tax.

26Section 911. Invoice.

27A sale of a tavern game by a licensed distributor to a
28licensee must be documented by an invoice listing the names and
29types of games sold, quantities of each game sold, the net
30revenue of each game and the aggregate amount of tax due on the

1net revenue on each invoice. Failure to provide a correct
2invoice shall result in a penalty of 50% of the tax amount due
3payable to the Commonwealth.

<-4Section 910. Reports.

5(a) Reports.--A licensee shall submit annual reports to the

<-6Section 912. Reports.

7A licensee shall submit an annual report to the board <-and the
8department for the preceding year on a form and in a manner 
9prescribed by the department. <-The department shall develop a
10schedule for the submission of the annual report. The report 
11shall include:

12(1) Prizes awarded as required under section 335 of the
13act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform 
14Code of 1971.

<-15(2) Amounts transferred to the General Fund.

16(3) Amounts given to designated charities.

17(4) Other information as required by the department.

18(b) Prizes.--The report shall include prizes awarded as
19required under section 335 of the act of March 4, 1971 (P.L.6,
20No.2), known as the Tax Reform Code of 1971.

21Section 911. Enforcement.

22(a) Board.--The board may, following notice and hearing
23impose the following penalties or suspend or revoke a license
24under this chapter.

25(b) Penalties.--The board may impose a civil penalty for a
26violation of this chapter in accordance with the following:

27(1) Up to $1,000 for an initial violation of this act.

28(2) Up to $3,000 for a second or subsequent violation.

29(c) Criminal penalty.--A violation of this act shall be a
30summary offense.

1(d) Department of Revenue.--The Department of Revenue shall
2enforce the provisions of section 909 as a tax in accordance
3with the enforcement provisions under Article XXVII of the act
4of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
51971.

<-6(2) Net revenue received from each game of chance
7conducted, itemized by week.

8(3) Amount of prizes paid from all games of chance,
9itemized by week.

10(4) Amount of tax remitted to the department.

11(5) Amount given to designated charities from tavern
12raffles.

13(6) Other information as required by the department.

14Section 913. Enforcement.

15(a) Board.--The board may, following notice and hearing,
16impose penalties or suspend or revoke a license under this
17chapter.

18(b) Penalties.--The board may impose a civil penalty for a
19violation of this chapter in accordance with the following:

20(1) Up to $1,000 for an initial violation of this act.

21(2) Up to $3,000 for a second or subsequent violation.

22(c) Criminal penalty.--A violation of this act shall be a
23misdemeanor of the third degree. A second or subsequent offense
24shall be a misdemeanor of the second degree.

25(d) Administrative law judge.--An administrative law judge
26under section 212 of the act of April 12, 1951 (P.L.90, No.21),
27known as the Liquor Code, may impose the penalties under this
28section following the issuance of a citation by the Bureau of
29Liquor Control Enforcement.

30(e) Revocation or failure to renew.--In addition to any

1other sanctions the board may impose under this chapter or under
2the Liquor Code, the board may, at its discretion suspend,
3revoke or deny renewal of any license issued under this chapter
4if it receives any information from any source that the
5applicant or any of its officers, directors, owners or employees
6is in violation of any provision of this chapter, that the
7applicant has furnished the board with false or misleading
8information or that the information contained in the applicant's
9initial application or any renewal application is no longer true
10and correct. In the event of a revocation or failure to renew,
11the applicant's authorization to conduct the previously approved
12activity shall immediately cease, and all fees paid in
13connection therewith shall be deemed to be forfeited. In the
14event of a suspension, the applicant's authorization to conduct
15the previously approved activity shall immediately cease until
16the board has notified the applicant that the suspension is no
17longer in effect.

18Section 914. Prohibitions.

19The following shall apply to any license authorized or issued
20under this chapter:

21(1) No license may be issued to a restaurant licensee
22whose place of business is located in a licensed facility as
23defined in 4 Pa.C.S. § 1103 (relating to definitions).

24(2) No license may be issued to a place of business on
25the grounds of a facility where a major league sports team
26conducts games or races.

27(3) No license may be issued to a place of business that
28has been decreed a nuisance pursuant to section 611 of the
29act of April 12, 1951 (P.L.90, No.21), known as the Liquor 
30Code.

1(4) The board shall be prohibited from issuing a license
2to any person who has been convicted of a felony offense or
3misdemeanor gambling offense in any jurisdiction unless 15
4years have elapsed from the date of conviction of the
5offense.

6(5) It shall be unlawful for an individual under 21
7years of age to play or attempt to play or otherwise
8participate in a tavern game.

9(6) It shall be unlawful for a licensee to permit an
10employee under 18 years of age to operate tavern games.

11(7) It shall be unlawful for an employee of a licensee
12to sell, operate or otherwise participate in the conduct of
13tavern games if the employee has been convicted in any
14jurisdiction of a felony or a misdemeanor gambling offense
15unless 15 years have elapsed from the date of conviction of
16the offense.

17Section <-7 6. The act is amended by adding a section to read:

18Section 3101. <-Transfer from General Fund to State Lottery Fund.

19If, on June 15, 2015, and June 15 of each year thereafter,
20the department determines that a decrease in the revenue
21deposited in that fiscal year in the State Lottery Fund is due
22to the play of small games of chance in retail licensed
23establishments in this Commonwealth, the department shall
24certify the amount of the decrease due to the activity. The
25department's determination shall be based upon an audit or other
26report of an independent expert regarding the decrease. <-The
27department shall submit an annual report on the State Lottery
28Fund and the impact of small games of chance on the State
29Lottery Fund, if any, to the chairman and minority chairman of
30the Appropriations Committee of the Senate and the chairman and

1minority chairman of the Appropriations Committee of the House
2of Representatives.

3Section <-8 7. Section 3101 of the act, added February 2, 2012
4(P.L.7, No.2), is amended to read:

5Section [3101] 3110. Effective date.

6This act shall take effect in 60 days.

7Section 9 8. This act shall take effect <-in 60 days. as
8follows:

9(1) The following provisions shall take effect
10immediately:

11(i) This section.

12(ii) The amendment of the definition of "major
13league sports drawing" and "major league sporting team"
14in section 103 of the act.

15(iii) The amendment or addition of section 304.1(c),
16(c.1), (f) and (h) of the act.

17(2) The remainder of this act shall take effect in 60
18days.

 

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