House Study Bill 162
SENATE/HOUSE FILE
BY (PROPOSED DEPARTMENT OF
INSPECTIONS AND APPEALS BILL)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act concerning social and charitable gambling, including the
2 regulation of cash raffles at fairs, prohibiting raffles at
3 annual game nights, establishing a permanent electrical and
4 mechanical amusement devices special fund and providing an
5 appropriation, and providing for the denial, suspension, and
6 revocation of certain gambling licenses by the department of
7 inspections and appeals.
8 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 Section 1. Section 99B.5, subsection 1, paragraphs e and
1 2 g, Code 2005, are amended to read as follows:
1 3 e. Except with respect to an annual raffle as provided in
1 4 paragraph "g", and subsection 3, cash prizes are not awarded
1 5 and merchandise prizes are not repurchased.
1 6 g. The actual retail value of any prize does not exceed
1 7 one thousand dollars. If a prize consists of more than one
1 8 item, unit, or part, the aggregate retail value of all items,
1 9 units, or parts shall not exceed one thousand dollars.
1 10 However, either a fair sponsor or a qualified organization,
1 11 but not both, may hold one raffle per calendar year at which
1 12 prizes having a combined value of more than one thousand
1 13 dollars may be offered. If the prize for the annual raffle is
1 14 cash, the total cash amount awarded shall not exceed two
1 15 hundred thousand dollars. If the prize is merchandise, its
1 16 value shall be determined by the purchase price paid by the
1 17 fair sponsor or qualified organization.
1 18 Sec. 2. Section 99B.5, subsection 3, unnumbered paragraph
1 19 1, Code 2005, is amended to read as follows:
1 20 A licensee under this section may hold one real property
1 21 raffle per calendar year in lieu of the annual raffle
1 22 authorized in subsection 1, paragraph "g", at which the value
1 23 of the real property may exceed one thousand dollars in lieu
1 24 of the or an annual raffle of cash as authorized in subsection
1 25 1, paragraph "g", if the total cash amount awarded is one
1 26 hundred thousand dollars or more, if all of the following
1 27 applicable requirements are met:
1 28 Sec. 3. Section 99B.5, subsection 3, paragraph a, Code
1 29 2005, is amended to read as follows:
1 30 a. The licensee has submitted the special real property or
1 31 cash raffle license application and a fee of one hundred
1 32 dollars to the department, has been issued a license, and
1 33 prominently displays the license at the drawing area of the
1 34 raffle.
1 35 Sec. 4. Section 99B.5, subsection 4, Code 2005, is amended
2 1 to read as follows:
2 2 4. For each real property or cash raffle license issued
2 3 pursuant to subsection 3, the department shall conduct a
2 4 special audit of the raffle to verify compliance with the
2 5 appropriate requirements of this chapter.
2 6 Sec. 5. Section 99B.8, subsection 1, unnumbered paragraph
2 7 1, Code 2005, is amended to read as follows:
2 8 Games of skill, games of chance, and card games and raffles
2 9 lawfully may be conducted during a period of twelve
2 10 consecutive hours once each year by any person. The games or
2 11 raffles may be conducted at any location except one for which
2 12 a license is required pursuant to section 99B.3 or section
2 13 99B.5, but only if all of the following are complied with:
2 14 Sec. 6. NEW SECTION. 99B.10D ELECTRICAL AND MECHANICAL
2 15 AMUSEMENT DEVICES == SPECIAL FUND.
2 16 Fees collected by the department pursuant to sections
2 17 99B.10 and 99B.10A shall be deposited in a special fund
2 18 created in the state treasury. Moneys in the fund are
2 19 appropriated to the department of inspections and appeals and
2 20 the department of public safety for administration and
2 21 enforcement of sections 99B.10, 99B.10A, 99B.10B, and 99B.10C,
2 22 including employment of necessary personnel. The distribution
2 23 of moneys in the fund to the department of inspections and
2 24 appeals and the department of public safety shall be pursuant
2 25 to a written policy agreed upon by the departments.
2 26 Notwithstanding section 12C.7, subsection 2, interest or
2 27 earnings on moneys deposited in the fund shall be credited to
2 28 the fund. Notwithstanding section 8.33, moneys remaining in
2 29 the fund at the end of a fiscal year shall not revert to the
2 30 general fund of the state.
2 31 Sec. 7. Section 99B.14, Code 2005, is amended to read as
2 32 follows:
2 33 99B.14 REVOCATION OF LICENSE DENIAL, SUSPENSION, AND
2 34 REVOCATION.
2 35 1. The department shall may deny, suspend, or revoke a
3 1 license issued pursuant to this chapter if the department
3 2 finds that an applicant, licensee, or an agent of the licensee
3 3 violates or permits violated or permitted a violation of a
3 4 provision of this chapter, or a departmental rule adopted
3 5 pursuant to chapter 17A, or if a for any other cause exists
3 6 for which the director of the department would be or would
3 7 have been justified in refusing to issue a license, or upon
3 8 the conviction of a person of a violation of this chapter or a
3 9 rule adopted under this chapter which occurred on the licensed
3 10 premises. However, the denial, suspension, or revocation of
3 11 one type of gambling license does not require, but may result
3 12 in, the denial, suspension, or revocation of a different type
3 13 of gambling license held by the same licensee.
3 14 Revocation proceedings shall be held only after giving
3 15 notice and an opportunity for hearing to the licensee. Notice
3 16 shall be given at least ten days in advance of the date set
3 17 for hearing. If the department finds cause for revocation,
3 18 the license shall be revoked for a period not to exceed two
3 19 years.
3 20 2. The process for denial, suspension, or revocation of a
3 21 license shall commence by delivering to the applicant or
3 22 licensee by certified mail, return receipt requested, or by
3 23 personal service a notice setting forth the particular reasons
3 24 for such action.
3 25 a. If a written request for a hearing is not received
3 26 within thirty days after the mailing or service of the notice,
3 27 the denial, suspension, or revocation of a license shall
3 28 become effective pending a final determination by the
3 29 department. The determination involved in the notice may be
3 30 affirmed, modified, or set aside by the department in a
3 31 written decision.
3 32 b. If a request for a hearing is timely received by the
3 33 department, the applicant or licensee shall be given an
3 34 opportunity for a prompt and fair hearing before the
3 35 department and the denial, suspension, or revocation shall be
4 1 deemed suspended until the department makes a final
4 2 determination. However, the director may suspend a license
4 3 prior to a hearing if the director finds that the public
4 4 integrity of the licensed activity is compromised or there is
4 5 a risk to public health, safety, or welfare. In addition, at
4 6 any time during or prior to the hearing the department may
4 7 rescind the notice of the denial, suspension, or revocation
4 8 upon being satisfied that the reasons for the denial,
4 9 suspension, or revocation have been or will be removed. On
4 10 the basis of any such hearing, the determination involved in
4 11 the notice may be affirmed, modified, or set aside by the
4 12 department in a written decision.
4 13 3. A copy of the final decision of the department shall be
4 14 sent by certified mail, return receipt requested, or served
4 15 personally upon the applicant or licensee. The applicant or
4 16 licensee may seek judicial review in accordance with the terms
4 17 of the Iowa administrative procedure Act, chapter 17A.
4 18 4. The procedure governing hearings authorized by this
4 19 section shall be in accordance with the rules promulgated by
4 20 the department and chapter 17A.
4 21 5. If the department finds cause for denial of a license,
4 22 the applicant may not reapply for the same license for a
4 23 period of two years. If the department finds cause for
4 24 suspension, the license shall be suspended for a period
4 25 determined by the department. If the department finds cause
4 26 for revocation, the license shall be revoked for a period not
4 27 to exceed two years.
4 28 EXPLANATION
4 29 This bill concerns social and charitable gambling as
4 30 provided for in Code chapter 99B.
4 31 Code section 99B.5, concerning raffles at fairs, is amended
4 32 to provide that the total amount awarded for an annual cash
4 33 raffle is limited to a maximum of $200,000. The bill also
4 34 provides that if the cash to be awarded at a raffle is
4 35 $100,000 or more, the requirements applicable to real property
5 1 raffles where the value of the real property exceeds $1,000
5 2 shall also apply. As a result, a licensee seeking to conduct
5 3 a cash raffle of $100,000 or more is required to get a special
5 4 cash raffle license and the department of inspections and
5 5 appeals is required to conduct a special audit of the raffle.
5 6 Code section 99B.8 is amended to provide that raffles are
5 7 not permitted at an annual game night.
5 8 New Code section 99B.10D provides for the establishment of
5 9 a permanent electrical and mechanical amusement devices
5 10 special fund. The bill provides that fees collected by the
5 11 department of inspections and appeals for amusement devices
5 12 shall be deposited in the fund and shall be appropriated to
5 13 the department of inspections and appeals and the department
5 14 of public safety for administration and enforcement of
5 15 provisions governing these amusement devices. A special fund
5 16 currently exists for the same purpose, but that fund only
5 17 provides for the deposit of fees collected in fiscal years
5 18 beginning July 1, 2003, and July 1, 2004. The bill codifies
5 19 and makes the fund permanent.
5 20 Code section 99B.14 is amended to provide that the
5 21 department of inspections and appeals has the authority to
5 22 deny or suspend a license if the department finds that an
5 23 applicant or licensee has violated a provision of Code chapter
5 24 99B. Under current law, the department may only revoke a
5 25 license for a violation of the chapter. The bill also
5 26 provides for the administrative procedure the department shall
5 27 follow if it intends to deny, revoke, or suspend a license.
5 28 The bill includes provisions governing notice, requests for
5 29 hearing, appeals, and penalties. The bill provides that the
5 30 department may suspend a license pending a hearing if the
5 31 director finds that the public integrity of the licensed
5 32 activity is compromised or there is a risk to public health,
5 33 safety, or welfare. The bill provides that hearings conducted
5 34 by the department shall comply with the Iowa administrative
5 35 procedure Act. The bill also provides that if an applicant
6 1 for a license is denied, the applicant may not reapply for two
6 2 years. In addition, if a license is suspended, the bill
6 3 provides that the department shall determine the length of the
6 4 suspension. Current law providing that a revocation remains
6 5 in effect for no more than two years is unchanged by the bill.
6 6 LSB 1261DP 81
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