SENATE BILL 278

48th legislature - STATE OF NEW MEXICO - first session, 2007

INTRODUCED BY

Phil A. Griego

AN ACT

RELATING TO GAMING; PROHIBITING ACQUISITION OF FUNCTIONING GAMING MACHINES FOR USE IN PRIVATE HOMES; AMENDING THE GAMING CONTROL ACT.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     Section 1. Section 60-2E-3 NMSA 1978 (being Laws 1997, Chapter 190, Section 5, as amended) is amended to read:

     "60-2E-3. DEFINITIONS.--As used in the Gaming Control Act:

          A. "affiliate" means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with a specified person;

          B. "affiliated company" means a company that:

                (1) controls, is controlled by or is under common control with a company licensee; and

                (2) is involved in gaming activities or involved in the ownership of property on which gaming is conducted;

          C. "applicant" means a person who has applied for a license or for approval of an act or transaction for which approval is required or allowed pursuant to the provisions of the Gaming Control Act;

          D. "application" means a request for the issuance of a license or for approval of an act or transaction for which approval is required or allowed pursuant to the provisions of the Gaming Control Act, but "application" does not include a supplemental form or information that may be required with the application;

          E. "associated equipment" means equipment or a mechanical, electromechanical or electronic contrivance, component or machine used in connection with gaming activity;

          F. "board" means the gaming control board;

          G. "certification" means a notice of approval by the board of a person required to be certified by the board;

          H. "certified technician" means a person certified by a manufacturer licensee to repair and service gaming devices, but who is prohibited from programming gaming devices;

          I. "company" means a corporation, partnership, limited partnership, trust, association, joint stock company, joint venture, limited liability company or other form of business organization that is not a natural person; "company" does not mean a nonprofit organization;

          J. "distributor" means a person who supplies gaming devices to a gaming operator but does not manufacture gaming devices;

          K. "equity security" means an interest in a company that is evidenced by:

                (1) voting stock or similar security;

                (2) a security convertible into voting stock or similar security, with or without consideration, or a security carrying a warrant or right to subscribe to or purchase voting stock or similar security;

                (3) a warrant or right to subscribe to or purchase voting stock or similar security; or

                (4) a security having a direct or indirect participation in the profits of the issuer;

          L. "executive director" means the chief administrative officer appointed by the board pursuant to Section 60-2E-7 NMSA 1978;

          M. "finding of suitability" means a certification of approval issued by the board permitting a person to be involved directly or indirectly with a licensee, relating only to the specified involvement for which it is made;

          N. "game" means an activity in which, upon payment of consideration, a player receives a prize or other thing of value, the award of which is determined by chance even though accompanied by some skill ["game" does not include an activity played in a private residence in which no person makes money for operating the activity except through winnings as a player];

          O. "gaming" means offering a game for play;

          P. "gaming activity" means an endeavor associated with the manufacture or distribution of gaming devices or the conduct of gaming;

          Q. "gaming device" means associated equipment or a gaming machine and includes a system for processing information that can alter the normal criteria of random selection that affects the operation of a game or determines the outcome of a game;

          R. "gaming employee" means a person connected directly with a gaming activity; "gaming employee" does not include:

                (1) bartenders, cocktail servers or other persons engaged solely in preparing or serving food or beverages;

                (2) secretarial or janitorial personnel;

                (3) stage, sound and light technicians; or

                (4) other nongaming personnel;

          S. "gaming establishment" means the premises on or in which gaming is conducted;

          T. "gaming machine" means a mechanical, electromechanical or electronic contrivance or machine that, upon insertion of a coin, token or similar object, or upon payment of any consideration, [is available] functions to play or operate a game, whether the payoff is made automatically from the machine or in any other manner and without regard to whether the machine is used for gaming;

          U. "gaming operator" means a person who conducts gaming;

          V. "holding company" means a company that directly or indirectly owns or has the power or right to control a company that is an applicant or licensee, but a company that does not have a beneficial ownership of more than ten percent of the equity securities of a publicly traded corporation is not a holding company;

          W. "immediate family" means natural persons who are related to a specified natural person by affinity or consanguinity in the first through the third degree;

          X. "independent administrator" means a person who administers an annuity, who is not associated in any manner with the gaming operator licensee for which the annuity was purchased and is in no way associated with the person who will be receiving the annuity;

          Y. "institutional investor" means a state or federal government pension plan or a person that meets the requirements of a qualified institutional buyer as defined in Rule 144A of the federal Securities Act of 1933, and is:

                (1) a bank as defined in Section 3(a)(6) of the federal Securities Exchange Act of 1934;

                (2) an insurance company as defined in Section 2(a)(17) of the federal Investment Company Act of 1940;

                (3) an investment company registered under Section 8 of the federal Investment Company Act of 1940;

                (4) an investment adviser registered under Section 203 of the federal Investment Advisers Act of 1940;

                (5) collective trust funds as defined in Section 3(c)(11) of the federal Investment Company Act of 1940;

                (6) an employee benefit plan or pension fund that is subject to the federal Employee Retirement Income Security Act of 1974, excluding an employee benefit plan or pension fund sponsored by a publicly traded corporation registered with the board; or

                (7) a group comprised entirely of persons specified in Paragraphs (1) through (6) of this subsection;

          Z. "intermediary company" means a company that:

                (1) is a holding company with respect to a company that is an applicant or licensee; and

                (2) is a subsidiary with respect to any holding company;

          AA. "key executive" means an executive of a licensee or other person having the power to exercise significant influence over decisions concerning any part of the licensed operations of the licensee or whose compensation exceeds an amount established by the board in a rule;

          BB. "license" means an authorization required by the board for engaging in gaming activities;

          CC. "licensee" means a person to whom a valid license has been issued;

          DD. "manufacturer" means a person who manufactures, fabricates, assembles, produces, programs or makes modifications to any gaming device for use or play in New Mexico or for sale, lease or distribution outside New Mexico from any location within New Mexico;

          EE. "net take" means the total of the following, less the total of all cash paid out as losses to winning patrons and those amounts paid to purchase annuities to fund losses paid to winning patrons over several years by independent administrators:

                (1) cash received from patrons for playing a game;

                (2) cash received in payment for credit extended by a licensee to a patron for playing a game; and

                (3) compensation received for conducting a game in which the licensee is not a party to a wager;

          FF. "nonprofit organization" means:

                (1) a bona fide chartered or incorporated branch, lodge, order or association, in existence in New Mexico prior to January 1, 1997, of a fraternal organization that is described in Section 501(c)(8) or (10) of the federal Internal Revenue Code of 1986 and that is exempt from federal income taxation pursuant to Section 501(a) of that code; or

                (2) a bona fide chartered or incorporated post, auxiliary unit or society of, or a trust or foundation for the post or auxiliary unit, in existence in New Mexico prior to January 1, 1997, of a veterans' organization that is described in Section 501(c)(19) or (23) of the federal Internal Revenue Code of 1986 and that is exempt from federal income taxation pursuant to Section 501(a) of that code;

          GG. "person" means a legal entity;

          HH. "premises" means land, together with all buildings, improvements and personal property located on the land;

          II. "progressive jackpot" means a prize that increases over time or as gaming machines that are linked to a progressive system are played and upon conditions established by the board may be paid by an annuity;

          JJ. "public post-secondary educational institution" means an institution designated in Article 12, Section 11 of the constitution of New Mexico and an institution designated in Chapter 21, Articles 13, 14 and 16 [and 17] NMSA 1978;

          KK. "progressive system" means one or more gaming machines linked to one or more common progressive jackpots;

          LL. "publicly traded corporation" means a corporation that:

                (1) has one or more classes of securities registered pursuant to the securities laws of the United States or New Mexico;

                (2) is an issuer subject to the securities laws of the United States or New Mexico; or

                (3) has one or more classes of securities registered or is an issuer pursuant to applicable foreign laws that, the board finds, provide protection for institutional investors that is comparable to or greater than the stricter of the securities laws of the United States or New Mexico;

          MM. "registration" means a board action that authorizes a company to be a holding company with respect to a company that holds or applies for a license or that relates to other persons required to be registered pursuant to the Gaming Control Act;

          NN. "subsidiary" means a company, all or a part of whose outstanding equity securities are owned, subject to a power or right of control or held, with power to vote, by a holding company or intermediary company; and

          OO. "work permit" means a card, certificate or permit issued by the board, whether denominated as a work permit, registration card or otherwise, authorizing the employment of the holder as a gaming employee."

- 10 -