0001|                         HOUSE BILL 692
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0002|     42ND LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION,
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0003|     1996
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0004|                         INTRODUCED BY
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0005|                      JAMES ROGER MADALENA
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0006|     
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0007|     
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0008|     
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0009|     
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0010|     
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0011|                             AN ACT
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0012|     RELATING TO GAMBLING; ENACTING THE GAMING COMPACT ACT, THE VIDEO
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0013|     GAMBLING ACT AND THE CHARITY GAMES ACT; ESTABLISHING PROCEDURES
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0014|     FOR THE RATIFICATION, NEGOTIATION, APPROVAL AND EXECUTION OF
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0015|     GAMING COMPACTS BETWEEN THE STATE AND INDIAN TRIBES; AUTHORIZING
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0016|     AND REGULATING CERTAIN GAMBLING ACTIVITIES; CHANGING CERTAIN
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0017|     EXISTING LAW PROVISIONS RELATING TO GAMBLING; CHANGING
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0018|     PROVISIONS RELATING TO LOTTERY BONDS; IMPOSING TAXES, FEES AND
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0019|     PENALTIES; AMENDING, REPEALING AND ENACTING SECTIONS OF THE NMSA
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0020|     1978; MAKING AN APPROPRIATION; DECLARING AN EMERGENCY.
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0021|     
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0022|     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0023|       Section 1.  [<u>NEW MATERIAL</u>]  SHORT TITLE.--Sections 1
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0024|     through 6 of this act may be cited as the "Gaming Compact Act".
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0025|       Section 2.  [<u>NEW MATERIAL</u>]  DEFINITIONS.--As used in the
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0001|     Gaming Compact Act: 
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0002|            A.  "committee" means the joint legislative committee
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0003|     on compacts created pursuant to Section 5 of the Gaming Compact
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0004|     Act;
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0005|            B.  "compact" means a tribal-state gaming compact
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0006|     entered into between a tribe and the state pursuant to IGRA and
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0007|     includes an ancillary agreement or proposed ancillary agreement
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0008|     related to that compact;
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0009|            C.  "gaming" means "class III gaming" as defined in
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0010|     IGRA;
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0011|            D.  "governor" means the governor of New Mexico;
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0012|            E.  "IGRA" means the federal Indian Gaming Regulatory
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0013|     Act (25 U.S.C.A. Sections 2701 et seq.); and
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0014|            F.  "tribe" means an Indian nation, tribe or pueblo
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0015|     located in whole or in part within the state.
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0016|       Section 3.  [<u>NEW MATERIAL</u>]  COMPACTS--RATIFICATION.--Compacts signed by the governor and the pueblos of Taos, San
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0017|     Juan, Santa Clara, Pojoaque, Tesuque, San Felipe, Santa Ana,
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0018|     Sandia, Isleta, Acoma, Nambe and San Ildelfonso and the
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0019|     Mescalero and Jicarilla Apache tribes that were approved by the
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0020|     secretary of the interior and published in the federal register
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0021|     are ratified by the legislature.  The governor is authorized to
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0022|     execute those compacts on behalf of the state of New Mexico.
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0023|       Section 4.  [<u>NEW MATERIAL</u>]  COMPACTS--NEGOTIATION--SUBMISSION TO LEGISLATURE BY GOVERNOR--APPROVAL OR REJECTION--COMPACT PROVISIONS--REPORT OF GOVERNOR TO LEGISLATURE.--
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0024|            A.  A request by a tribe to negotiate a compact
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0025|     initially or to renegotiate or amend an existing compact shall
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0001|     be submitted to the governor in writing pursuant to IGRA.
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0002|            B.  The governor may designate a representative to
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0003|     negotiate the terms of a compact.  The designation shall be
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0004|     written and a copy of the designation shall be delivered or
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0005|     mailed within three days of the designation to the speaker of
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0006|     the house of representatives and the president pro tempore of
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0007|     the senate.  The designated representative of the governor is
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0008|     authorized to negotiate the terms of a compact on behalf of the
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0009|     state, but neither the representative nor the governor is
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0010|     authorized to execute a compact on behalf of the state without
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0011|     legislative approval granted pursuant to the provisions of this
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0012|     section. 
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0013|            C.  At the conclusion of negotiations a proposed
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0014|     compact shall be prepared and submitted by the governor to the
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0015|     committee.  Submittal of a proposed compact occurs when the
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0016|     compact and the submittal document are received for the
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0017|     committee by the legislative council service.
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0018|            D.  The committee shall review the proposed compact
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0019|     and within thirty days after its receipt shall:
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0020|                 (1)  by written report to the legislature 
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0021|     recommend approval of the compact as proposed; or 
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0022|                 (2)  by written transmittal document to the
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0023|     governor or his designated representative propose specific
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0024|     modifications to the compact and request the governor to resume
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0025|     negotiations with the tribe.
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0001|            E.  If the committee proposes specific modifications
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0002|     to the proposed compact, the governor or his designated
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0003|     representative may resume negotiations with the tribe in
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0004|     accordance with the committee's recommendations.  If, within
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0005|     thirty days of receipt by the governor of the transmittal
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0006|     document on the specific modifications proposed, either the
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0007|     governor or the tribe notifies the other in writing that it
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0008|     refuses to negotiate further, the governor shall promptly give
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0009|     written notification to the committee of the decision.  If
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0010|     negotiations are resumed, the governor shall notify the
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0011|     committee of the date that he or his designated representative
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0012|     has resumed negotiations on the requested modifications.  The
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0013|     approval process described in this section for the originally
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0014|     submitted proposed compact shall be followed for consideration
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0015|     of a proposed modified compact, except that the time limitation
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0016|     for review by the committee specified in Subsection D of this
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0017|     section is reduced to ten days.
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0018|            F.  Within five days of being notified that further
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0019|     negotiations are refused by the tribe or the governor, the
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0020|     committee shall reconsider the proposed compact and vote to
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0021|     recommend its approval or rejection or shall vote to make no
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0022|     recommendation on the proposed compact.
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0023|            G.  If the legislature is in session when a report of
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0024|     the committee recommending approval or rejection of a proposed
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0025|     compact is made or a report of a vote of no recommendation is
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0001|     made, within five days of the date the report is received the
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0002|     committee shall prepare and introduce in each house a resolution
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0003|     approving the proposed compact as submitted by the governor.  
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0004|     A single resolution in each house may cover more than one
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0005|     compact if the terms of the compacts are identical except for
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0006|     the name of the tribe and the name of the person executing the
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0007|     compact on behalf of the tribe.  A copy of the committee report
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0008|     shall be submitted with the resolution.  If a majority of the 
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0009|     members present of each house votes to adopt the resolution, the
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0010|     compact is approved by the legislature and the governor shall
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0011|     execute it on behalf of the state. 
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0012|            H.  If the legislature is not in session when a
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0013|     report of the committee recommending approval or rejection of a
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0014|     proposed compact is made or a report of a vote of no
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0015|     recommendation is made, the committee shall inform the speaker
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0016|     of the house of representatives and the president pro tempore of
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0017|     the senate, and the legislature shall proceed pursuant to the
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0018|     provisions of Subsection G of this section by no later than the
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0019|     fifth day after the legislature convenes in a regular session or
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0020|     a special session called for the purpose of considering the
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0021|     proposed compact. 
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0022|            I.  The legislature may not amend or modify a
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0023|     proposed compact submitted to it pursuant to the provisions of
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0024|     this section, and it may not refer a proposed compact to a
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0025|     committee. 
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0001|            J.  A compact negotiated on behalf of the state
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0002|     pursuant to this section shall contain: 
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0003|                 (1)  a provision recognizing the right of each
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0004|     party to the compact to request that the compact be amended,
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0005|     renegotiated or replaced by a new compact, including the right
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0006|     of the legislature by joint resolution to request amendment,
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0007|     renegotiation or replacement of the compact, and providing terms
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0008|     under which either party, including the legislature, may request
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0009|     amendment, renegotiation or replacement of a compact; and
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0010|                 (2)  a provision that, in the event of a request
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0011|     for amendment, renegotiation or replacement of the compact, the
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0012|     existing compact will remain in effect until amended,
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0013|     renegotiated or replaced.
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0014|            K.  If a request for negotiation of a compact is made
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0015|     by a tribe and the proposed compact is identical to a compact
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0016|     previously approved by the legislature except for the name of
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0017|     the compacting tribe and the names of the persons to execute the
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0018|     compact on behalf of the tribe and on behalf of the state, the
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0019|     governor shall approve and sign the compact on behalf of the
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0020|     state without submitting the compact for approval pursuant to
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0021|     the provisions of this section.  A compact signed by the
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0022|     governor pursuant to this subsection is deemed approved by the
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0023|     legislature.
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0024|       Section 5.  [<u>NEW MATERIAL</u>]  JOINT LEGISLATIVE COMMITTEE
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0025|     ON COMPACTS--CREATION--MEMBERSHIP--AUTHORITY.--
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0001|            A.  The "joint legislative committee on compacts" is
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0002|     created.  Once established it shall continue operating until
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0003|     specific action is taken by the legislature to terminate its
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0004|     existence.  
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0005|            B.  The committee shall have eight members, four from
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0006|     the house of representatives and four from the senate.  House
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0007|     members shall be appointed by the speaker of the house of
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0008|     representatives, and senate members shall be appointed by the
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0009|     committees' committee of the senate or, if the senate
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0010|     appointments are made in the interim, by the president pro
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0011|     tempore of the senate after consultation with and agreement of a
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0012|     majority of the members of the committees' committee.  Members
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0013|     shall be appointed from each house to give the two major
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0014|     political parties in each house equal representation on the
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0015|     committee.  At least two of the committee members shall be
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0016|     legislators who are also members of a tribe if there are two or
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0017|     more legislators meeting that requirement.  If there is but one
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0018|     legislator meeting that requirement, that legislator shall be
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0019|     appointed as a committee member, and the membership shall be
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0020|     adjusted subsequently if additional qualifying legislators
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0021|     become available.
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0022|            C.  In addition to its duty to review proposed
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0023|     compacts, the committee may establish and transmit to the
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0024|     governor proposed guidelines reflecting the public policies and
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0025|     state interests, as embodied in the constitution of New Mexico,
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0001|     state laws and case law of the state, that are consistent with
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0002|     IGRA and that will be used by the committee in reviewing
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0003|     proposed compacts.
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0004|            D.  The president pro tempore of the senate shall
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0005|     designate a senate member of the committee to be chairman of the
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0006|     committee in odd-numbered years and the vice chairman in even-numbered years.  The speaker of the house of representatives
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0007|     shall designate a house member of the committee to be chairman
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0008|     of the committee in even-numbered years and the vice chairman in
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0009|     odd-numbered years.   
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0010|            E.  The committee may meet at the call of the
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0011|     chairman.
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0012|            F.  The committee may meet during legislative
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0013|     sessions as needed.
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0014|            G.  Staff services for the committee shall be
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0015|     provided by the legislative council service.  
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0016|       Section 6.  [<u>NEW MATERIAL</u>]  ACCESS TO DOCUMENTS--LIMITATION.--The following documents are confidential and shall
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0017|     not be made available to the public without the express consent
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0018|     of the tribe or except as is otherwise provided in an approved
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0019|     compact:
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0020|            A.  reports containing results of background
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0021|     investigations of individuals employed at tribal gaming
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0022|     enterprises, vendors, contractors and management officials and
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0023|     any other documents pertaining to those investigations;
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0024|            B.  documents showing income and expenses of tribal
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0025|     gaming facilities;
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0001|            C.  documents pertaining to complaints or allegations
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0002|     of violations of applicable laws or compact provisions and
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0003|     investigations into those complaints or allegations; and
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0004|            D.  documents pertaining to licensing of or
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0005|     investigation into gaming devices and documents showing payouts
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0006|     of individual gaming devices.
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0007|       Section 7.  [<u>NEW MATERIAL</u>]  SHORT TITLE.--Sections 7
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0008|     through 26 of this act may be cited as the "Video Gambling Act".
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0009|       Section 8.  [<u>NEW MATERIAL</u>]  PURPOSE.--The purpose of the
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0010|     Video Gambling Act is to make lawful and regulate the conduct
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0011|     and operation of certain electronic video games of chance by
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0012|     certain nonprofit organizations and the operation of both
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0013|     electronic video games of chance and slot machines by
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0014|     racetracks.
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0015|       Section 9.  [<u>NEW MATERIAL</u>]  DEFINITIONS.--As used in the
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0016|     Video Gambling Act:
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0017|            A.  "department" means the regulation and licensing
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0018|     department, the superintendent of regulation and licensing or an
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0019|     employee of the department exercising authority lawfully
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0020|     delegated to that employee by the superintendent;
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0021|            B.  "distributor" means a person who sells, offers
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0022|     for sale or otherwise furnishes to another person a video
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0023|     gambling machine or a slot machine;
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0024|            C.  "fraternal organization" means an organization
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0025|     within this state, not organized for pecuniary profit, that:
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0001|                 (1)  is a branch, lodge or chapter of a national
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0002|     or state organization and exists for the common business,
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0003|     brotherhood or other interests of its members;
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0004|                 (2)  has existed in New Mexico for at least
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0005|     three years immediately prior to making application for a
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0006|     license pursuant to the Video Gambling Act;
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0007|                 (3)  has been granted an exemption from federal
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0008|     income tax by the United States commissioner of internal revenue
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0009|     as an organization described in Section 501(c) of the Internal
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0010|     Revenue Code of 1986, as amended;
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0011|                 (4)  is exempt from state income tax pursuant to
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0012|     Section 7-2-4 NMSA 1978; and
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0013|                 (5)  is not a college or high school fraternity
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0014|     or sorority;
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0015|            D.  "gross receipts" means the total amount of money
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0016|     and the value of other consideration received from selling,
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0017|     renting, leasing, distributing, operating, conducting or
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0018|     assisting in the operation or conduct of any activities
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0019|     authorized by the Video Gambling Act, except, in an exchange in
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0020|     which the money or other consideration received does not reflect
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0021|     the value of the property exchanged, "gross receipts" means the
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0022|     reasonable value of the property exchanged as determined by the
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0023|     department;
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0024|            E.  "licensee" means the holder of a license issued
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0025|     pursuant to the Video Gambling Act;
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0001|            F.  "manufacturer" means a person who assembles, from
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0002|     parts or raw materials, a video gambling machine or slot
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0003|     machine;
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0004|            G.  "net receipts" means gross receipts from
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0005|     operating a video gambling machine or slot machine, or both,
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0006|     less the amounts paid as prizes and winnings by the machine;
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0007|            H.  "operate" means to possess, for the purpose of
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0008|     allowing persons to play, or to maintain a video gambling
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0009|     machine or slot machine;
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0010|            I.  "person" means an individual or other legal
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0011|     entity;
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0012|            J.  "play" means to activate a video gambling machine
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0013|     or slot machine and to manipulate or work it for the purpose of
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0014|     trying to win money, prizes or other consideration;
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0015|            K.  "qualified organization" means a fraternal
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0016|     organization or a veterans' organization.
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0017|            L.  "racetrack" means a facility or person licensed
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0018|     by the state racing commission to conduct horse racing within
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0019|     this state;
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0020|            M.  "slot machine" means any mechanical or electronic
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0021|     machine that upon insertion of a coin or token may be played and
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0022|     that, by chance, dispenses, or the player may otherwise receive,
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0023|     cash, tokens, free plays or credits that can be redeemed for
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0024|     cash, coins, tokens or other consideration, but "slot machine"
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0025|     does not include amusement-type game machines that are commonly
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0001|     used for amusement only, which only pay out free games or
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0002|     tickets or credits that may only be exchanged for merchandise of
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0003|     insignificant value and are not operated by a licensee;
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0004|            N.  "veterans' organization" means an organization
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0005|     within this state, or any branch, lodge or chapter of a national
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0006|     or state organization within this state, that is not organized
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0007|     for pecuniary profit, the membership of which consists entirely
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0008|     of individuals who were members of the armed services or forces
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0009|     of the United States, that has been in existence in New Mexico
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0010|     for at least three years immediately prior to making application
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0011|     for a license pursuant to the Video Gambling Act, that has been
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0012|     granted an exemption from federal income tax by the United
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0013|     States commissioner of internal revenue as an organization
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0014|     described in Section 501(c) of the Internal Revenue Code of
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0015|     1986, as amended, and that is exempt from state income tax
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0016|     pursuant to Section 7-2-4 NMSA 1978; and
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0017|            O.  "video gambling machine" means any electronic
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0018|     device that, upon payment of any consideration, simulates the
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0019|     play of any game of chance, including but not limited to pull
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0020|     tabs, poker, keno, blackjack, craps, roulette and any other
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0021|     similar games defined by regulation of the department, that uses
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0022|     video display and microprocessors and that, by chance or through
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0023|     some combination of chance and skill, dispenses, or the player
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0024|     may otherwise receive, cash, tokens, free plays or credits that
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0025|     can be redeemed for cash, coins or tokens, prizes or other
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0001|     consideration, but "video gambling machine" does not include
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0002|     amusement-type video game machines that do not simulate the play
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0003|     of any game of chance and that are commonly used for amusement
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0004|     only, which only pay out free games or tickets or credits that
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0005|     may only be exchanged for merchandise of insignificant value and
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0006|     are not operated by a licensee.
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0007|       Section 10.  [<u>NEW MATERIAL</u>]  PROHIBITION OF ACTIVITIES
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0008|     INVOLVING UNAUTHORIZED VIDEO GAMBLING MACHINES AND SLOT
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0009|     MACHINES--EXCEPTION.--
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0010|            A.  Except as provided in Subsection B of this
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0011|     section, unless a person has a valid appropriate license or
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0012|     permit issued by the department pursuant to the Video Gambling
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0013|     Act, a person shall not:
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0014|                 (1)  manufacture, import, sell, lease, rent,
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0015|     distribute, operate or participate in the operation of a video
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0016|     gambling machine or slot machine; or
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0017|                 (2)  conduct or participate in any activity
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0018|     involving a video gambling machine or slot machine.
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0019|            B.  The prohibition in Subsection A of this section
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0020|     does not apply to an Indian nation, tribe or pueblo.
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0021|       Section 11.  [<u>NEW MATERIAL</u>]  LICENSING GENERAL
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0022|     PROVISIONS.--
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0023|            A.  Licenses may be issued only in accordance with
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0024|     the provisions of the Video Gambling Act.
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0025|            B.  Any applicant for or holder of a license issued 
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0001|     pursuant to the Video Gambling Act shall produce and furnish all
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0002|     records, documents and information requested by the department. 
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0003|     No applicant or holder of a license shall interfere or attempt
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0004|     to interfere with an investigation by the department.
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0005|            C.  The department shall investigate the
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0006|     qualifications of applicants for licenses under the Video
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0007|     Gambling Act.  The department shall investigate the conditions
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0008|     existing in the community in which the premises for which any
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0009|     license is sought are located before the license is issued to
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0010|     ensure that a license is not issued to persons or for locations
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0011|     if the issuance is prohibited by state law or contrary to the
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0012|     public health or safety.
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0013|            D.  No license shall be issued to:
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0014|                 (1)  a proprietorship if the proprietor has been
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0015|     convicted of a felony;
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0016|                 (2)  a general partnership if a general partner
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0017|     has been convicted of a felony;
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0018|                 (3)  a limited partnership if a general partner
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0019|     has been convicted of a felony or if a limited partner
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0020|     contributing ten percent or more of the total value of
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0021|     contributions made to the limited partnership or entitled to ten
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0022|     percent or more of the profits earned or other compensation by
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0023|     way of income paid by the limited partnership has been convicted
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0024|     of a felony;
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0025|                 (4)  a limited liability company if a manager or
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0001|     member with management responsibilities has been convicted of a
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0002|     felony;
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0003|                 (5)  a corporation, association or similar
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0004|     entity having a shareholder holding more than ten percent of the
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0005|     stock of the entity, a director or an officer who has been
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0006|     convicted of a felony; or
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0007|                 (6)  a person subject to the control of an
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0008|     individual or person who has been convicted of a felony when
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0009|     that control arises out of relationships defined by regulations
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0010|     of the department as resulting in control.
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0011|            E.  A licensee shall not employ an individual in a
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0012|     position having authority or responsibility to supervise machine
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0013|     gambling for the licensee if that individual has been convicted
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0014|     of a felony.
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0015|            F.  An applicant for a license shall file with the
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0016|     application two complete sets of fingerprints taken under the
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0017|     supervision of and certified by an officer of the New Mexico
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0018|     state police, a county sheriff or a municipal chief of police
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0019|     for the following described individuals:
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0020|                 (1)  if the applicant is a proprietorship, the
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0021|     proprietor;
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0022|                 (2)  if the applicant is a general partnership,
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0023|     each general partner;
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0024|                 (3)  if the applicant is a limited partnership,
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0025|     all general partners and each limited partner contributing ten
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0001|     percent or more of the total value of contributions to the
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0002|     limited partnership or entitled to ten percent or more of the
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0003|     profits earned or other compensation by way of income paid by
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0004|     the limited partnership;
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0005|                 (4)  if the applicant is a limited liability
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0006|     company, each manager or member with management
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0007|     responsibilities;
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0008|                 (5)  if the applicant is a corporation,
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0009|     association or similar entity, each shareholder holding ten
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0010|     percent or more of the outstanding stock, each principal
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0011|     officer, each director and any agent responsible for the
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0012|     operation of the licensee; and
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0013|                 (6)  an individual having control of an
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0014|     individual or entity applicant when that control arises out of
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0015|     relationships defined by regulations of the department as
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0016|     resulting in control.
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0017|            G.  The department may exchange identification
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0018|     records and information with law enforcement agencies for
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0019|     official use.  Any identification records received from the
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0020|     United States department of justice, including identification
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0021|     records based on fingerprints, shall be used only to accomplish
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0022|     the licensing purposes and comply with the provisions of the
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0023|     Video Gambling Act.  The department shall not disseminate
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0024|     identification records or information received to any person
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0025|     except law enforcement agencies for official use only. 
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0001|            H.  An application for the issuance or annual renewal
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0002|     of a license shall be accompanied by a license fee in the amount
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0003|     of one thousand dollars ($1,000).     
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0004|            I.  The department shall by regulation set forth the
    |
0005|     requirements for and contents of an application for issuance and
    |
0006|     renewal of licenses, consistent with the provisions of the Video
    |
0007|     Gambling Act.  The regulations shall include detailed provisions
    |
0008|     describing those situations and relationships among persons and
    |
0009|     applicants in which a person is determined to have control of
    |
0010|     another for the purpose of qualifications and investigations
    |
0011|     required for licensure.
    |
0012|            J.  All licenses issued pursuant to the Video
    |
0013|     Gambling Act expire on July 1 of each year and may be renewed if
    |
0014|     the licensee makes the required application and pays the
    |
0015|     required fee.  If a license expires, the licensee shall cease
    |
0016|     all video gambling activities and transactions until the license
    |
0017|     is renewed.
    |
0018|            K.  The holder of a license issued pursuant to the
    |
0019|     Video Gambling Act has no vested property right in the license. 
    |
0020|     The license is the property of the state.  Licenses issued
    |
0021|     pursuant to the Video Gambling Act are not subject to sale,
    |
0022|     lease, devise, transfer, assignment, execution, attachment, a
    |
0023|     security transaction, liens or receivership. 
    |
0024|       Section 12.  [<u>NEW MATERIAL</u>]  VIDEO GAMBLING MACHINE
    |
0025|     LICENSE.--
    |
0001|            A.  A license may be issued to a qualified
    |
0002|     organization to own and operate video gambling machines for
    |
0003|     which permits have been issued by the department.  A video
    |
0004|     gambling machine licensee shall not own or operate slot
    |
0005|     machines.  A video gambling machine licensee shall operate video
    |
0006|     gambling machines only at the location of its primary place of
    |
0007|     business and at no other location.
    |
0008|            B.  A video gambling machine licensee may install and
    |
0009|     operate video gambling machines only at the location stated in
    |
0010|     its application and approved by the department.
    |
0011|            C.  No person other than an active member of a
    |
0012|     veterans' organization or a fraternal organization or a bona
    |
0013|     fide guest of that active member may play video gambling
    |
0014|     machines owned or operated by a veterans' organization or the
    |
0015|     fraternal organization that is a video gambling machine
    |
0016|     licensee.
    |
0017|            D.  The department shall prescribe by regulation the 
    |
0018|     information required, frequency of reporting, which shall be no
    |
0019|     less often than quarterly, and the form of the reports to be
    |
0020|     made by video gambling machine licensees.
    |
0021|            E.  No video gambling machine licensee may purchase,
    |
0022|     lease or otherwise receive a video gambling machine except from
    |
0023|     a distributor licensed pursuant to the Video Gambling Act.
    |
0024|            F.  No more than twenty-five video gambling machines
    |
0025|     may be operated by a video gambling machine licensee at any
    |
0001|     given time, subject to the limitations contained in Section 17
    |
0002|     of the Video Gambling Act.
    |
0003|       Section 13.  [<u>NEW MATERIAL</u>]  RACETRACK LICENSE.--
    |
0004|            A.  A license may be issued to a racetrack to own and
    |
0005|     operate video gambling machines or slot machines, or both.
    |
0006|            B.  A racetrack licensee may install and operate
    |
0007|     video gambling machines or slot machines, or both, for which
    |
0008|     permits have been issued by the department only at the location
    |
0009|     stated in its application and approved by the department.  That
    |
0010|     location constitutes the licensed premises of the racetrack
    |
0011|     licensee for purposes of the Video Gambling Act.
    |
0012|            C.  No racetrack may operate and no person may play
    |
0013|     or be allowed by the racetrack to play a video gambling machine
    |
0014|     or slot machine at the racetrack except in strict compliance
    |
0015|     with the following provisions:
    |
0016|                 (1)  a video gambling machine or slot machine
    |
0017|     may be played only on days the racetrack is holding a live
    |
0018|     formal race meet or simulcasting live races occurring at
    |
0019|     racetracks elsewhere in New Mexico and authorized by the state
    |
0020|     racing commission, during times established by the commission
    |
0021|     but for no more than twelve hours on those days; and
    |
0022|                 (2)  members of the public patronizing the
    |
0023|     racetrack, except individuals who have not attained the age of
    |
0024|     twenty-one, shall be allowed to play any video gambling machine
    |
0025|     or slot machine operated by the racetrack licensee.
    |
0001|            D.  No racetrack licensee may purchase, lease or
    |
0002|     otherwise receive a video gambling machine or slot machine
    |
0003|     except from a distributor licensed pursuant to the Video
    |
0004|     Gambling Act.
    |
0005|            E.  The maximum number of video gambling machines or
    |
0006|     slot machines, or both, that may be operated by a racetrack
    |
0007|     licensee on that licensee's licensed premises at any time shall
    |
0008|     be established by the department based upon recommendations from
    |
0009|     the state racing commission.
    |
0010|       Section 14.  [<u>NEW MATERIAL</u>]  MANUFACTURER'S LICENSE.--
    |
0011|            A.  A license may be issued to a person desiring to
    |
0012|     manufacture video gambling machines or slot machines, or both,
    |
0013|     in this state.
    |
0014|            B.  No person shall manufacture video gambling
    |
0015|     machines or slot machines, or both, in this state unless the
    |
0016|     person is issued a manufacturer's license by the department.
    |
0017|            C.  A licensed manufacturer shall report to the
    |
0018|     department, on prescribed forms, information required by
    |
0019|     regulation of the department.
    |
0020|            D.  No licensed manufacturer may sell or solicit to
    |
0021|     sell a video gambling machine or slot machine to any person
    |
0022|     except a licensed distributor.
    |
0023|            E.  No licensed manufacturer may operate, receive for
    |
0024|     resale or participate directly or indirectly in the operation or
    |
0025|     resale of a video gambling machine or slot machine.
    |
0001|       Section 15.  [<u>NEW MATERIAL</u>]  DISTRIBUTOR'S LICENSE.--
    |
0002|            A.  A license may be issued to a person desiring to
    |
0003|     distribute video gambling machines or slot machines, or both, by
    |
0004|     sale, lease or other transaction in this state.
    |
0005|            B.  No person may distribute video gambling machines
    |
0006|     or slot machines by sale, lease or other transaction in this
    |
0007|     state unless the person is issued a distributor's license by the
    |
0008|     department.
    |
0009|            C.  No licensed distributor may distribute a video
    |
0010|     gambling machine by sale, lease or other transaction except to a
    |
0011|     video gambling machine licensee or racetrack licensee.  No
    |
0012|     licensed distributor may distribute a slot machine by sale,
    |
0013|     lease or other transaction except to a racetrack licensee.
    |
0014|            D.  A licensed distributor shall report to the
    |
0015|     department, on prescribed forms, information required by
    |
0016|     regulation of the department.
    |
0017|            E.  No licensed distributor may operate, receive for
    |
0018|     resale or participate directly or indirectly in the operation or
    |
0019|     resale of a video gambling machine or slot machine.
    |
0020|       Section 16.  [<u>NEW MATERIAL</u>]  REGULATIONS.--
    |
0021|            A.  The department may adopt regulations necessary to
    |
0022|     implement the Video Gambling Act.  Other than emergency
    |
0023|     regulations adopted pursuant to the provisions of Subsection B
    |
0024|     of this section, no regulation affecting any person or agency
    |
0025|     outside the department shall be adopted, amended or repealed
    |
0001|     without a public hearing on the proposed action before the
    |
0002|     department or a designated hearing officer.  The public hearing
    |
0003|     shall be held in Santa Fe county.  Notice of the subject matter
    |
0004|     of the regulation, the date, time and place of the public
    |
0005|     hearing, the manner in which interested persons may present
    |
0006|     their views and the method by which copies of the proposed
    |
0007|     regulation, amendment or repeal may be obtained shall be
    |
0008|     published once at least thirty days prior to the hearing date in
    |
0009|     a newspaper of general circulation.  All regulations shall be
    |
0010|     filed in accordance with the State Rules Act.
    |
0011|            B.  If the department determines that an emergency
    |
0012|     exists that requires immediate action to implement or enforce
    |
0013|     the provisions of the Video Gambling Act, it may adopt a
    |
0014|     regulation or amendment or repeal thereof without notice and
    |
0015|     hearing, and the emergency regulation shall become effective
    |
0016|     immediately upon its filing under the State Rules Act.  The
    |
0017|     emergency regulation shall not continue in effect longer than
    |
0018|     forty-five days unless within that time the department commences
    |
0019|     proceedings to adopt the regulation by issuing the notice
    |
0020|     required in Subsection A of this section.  If the department
    |
0021|     commences proceedings by issuing notice, the emergency
    |
0022|     regulation shall remain in effect until a permanent regulation
    |
0023|     takes effect or until the procedures are otherwise completed.
    |
0024|            C.  Regulations adopted by the department may provide
    |
0025|     for the following:
    |
0001|                 (1)  reporting requirements in addition to those
    |
0002|     set forth in the Video Gambling Act;
    |
0003|                 (2)  required provisions in purchase or leasing
    |
0004|     contracts relating to video gambling machines and slot machines;
    |
0005|                 (3)  appropriate security measures providing for
    |
0006|     the safety of participants in the conduct of video gambling; 
    |
0007|                 (4)  the contents of and process for
    |
0008|     applications for licenses or permits issued pursuant to the
    |
0009|     Video Gambling Act;
    |
0010|                 (5)  minimum required percentage of paybacks by
    |
0011|     video gambling machines and slot machines; and
    |
0012|                 (6)  other regulations consistent with the
    |
0013|     provisions of the Video Gambling Act that provide for the
    |
0014|     integrity, honesty and security of the conduct of video gambling
    |
0015|     and slot machine activities or transactions by licensees.
    |
0016|            D.  The department shall enter into a contract with
    |
0017|     the New Mexico lottery authority to conduct the monitoring of
    |
0018|     video gambling machines and slot machines, including receiving
    |
0019|     and transmitting to the department by the lottery authority the
    |
0020|     information required by the Video Gambling Act, performing
    |
0021|     electronic funds transfers, enabling and disabling video
    |
0022|     gambling machines and slot machines and performing other
    |
0023|     services relating to the operation and administration of video
    |
0024|     gambling machines and slot machines.  The contract is not
    |
0025|     subject to the Procurement Code.  Compensation to the lottery
    |
0001|     authority shall not exceed actual costs incurred by the
    |
0002|     authority in performing the services plus up to two percent of
    |
0003|     the net receipts of a monitored licensee.  The contract may
    |
0004|     provide for electronic funds transfer of that portion of the
    |
0005|     compensation.  The department shall provide by regulation for
    |
0006|     the allocation and payment of the compensation.
    |
0007|            E.  The department shall, on or before January 1,
    |
0008|     1997, adopt by regulation mechanical and electronic standards
    |
0009|     for video gambling machines and slot machines, ensuring the
    |
0010|     integrity, honesty and security of the machines, which standards
    |
0011|     shall not be more lenient than those applied to similar machines
    |
0012|     in lawful use within the United States by any other jurisdiction
    |
0013|     regulating the conduct of video machine and slot machine
    |
0014|     gambling.
    |
0015|       Section 17.  [<u>NEW MATERIAL</u>]  PERMITTING OF VIDEO GAMBLING
    |
0016|     MACHINES AND SLOT MACHINES.--
    |
0017|            A.  The department shall ensure that no more than two
    |
0018|     thousand video gambling machines are permitted and operated
    |
0019|     within the state at any given time by video gambling machine
    |
0020|     licensees.  This limitation does not apply to racetrack
    |
0021|     licensees.  If the number of completed applications for permits
    |
0022|     exceeds the number of permits available, the department shall
    |
0023|     allocate permits based upon regulations of the department
    |
0024|     according to membership size, geographic diversity and any other
    |
0025|     factors deemed relevant by the department.  Completed
    |
0001|     applications are those that provide all information requested,
    |
0002|     indicate the licensee is able to place immediately the video
    |
0003|     gambling machines or slot machines for which a permit is
    |
0004|     requested into operation at the approved premises, include the
    |
0005|     appropriate application fees and specifically comply with all
    |
0006|     requirements of the Video Gambling Act and regulations adopted
    |
0007|     pursuant to that act.  If a licensee removes a video gambling
    |
0008|     machine or slot machine from operation for longer than ten
    |
0009|     consecutive days, he shall notify the department immediately,
    |
0010|     and the permit issued for that machine shall be canceled.
    |
0011|            B.  A licensee who intends to own or operate a video
    |
0012|     gambling machine or slot machine shall file an application for a
    |
0013|     permit with the department for each video gambling machine or
    |
0014|     slot machine purchased, leased or otherwise acquired by the
    |
0015|     licensee on forms prescribed by the department within twenty
    |
0016|     days after purchasing, leasing or otherwise acquiring the
    |
0017|     machine.  The department shall not issue a permit for any
    |
0018|     machine that has not been tested in accordance with the
    |
0019|     provisions of Section 18 of the Video Gambling Act or, after
    |
0020|     January 1, 1997, does not comply with standards adopted by the
    |
0021|     department by regulation.
    |
0022|            C.  Each application for a permit shall be
    |
0023|     accompanied by a permit fee of one hundred dollars ($100) per
    |
0024|     machine.
    |
0025|            D.  The department shall issue a permit for a video
    |
0001|     gambling machine or slot machine if it complies with all
    |
0002|     conditions of the Video Gambling Act and regulations adopted
    |
0003|     pursuant to that act and if a properly completed application
    |
0004|     along with the required application fee for each machine has
    |
0005|     been submitted, but the department may refuse to issue a permit
    |
0006|     for a specific machine if it believes that the machine is
    |
0007|     inaccurate, unreliable or will not be operated in accordance
    |
0008|     with the provisions of the Video Gambling Act or regulations
    |
0009|     adopted pursuant to that act.
    |
0010|            E.  No person may operate a video gambling machine or
    |
0011|     slot machine and no person may play a video gambling machine or
    |
0012|     slot machine unless the department has issued a permit for the
    |
0013|     machine.
    |
0014|            F.  All applications for a permit shall provide
    |
0015|     information required by regulation of the department. 
    |
0016|            G.  A video gambling machine licensee and a racetrack
    |
0017|     licensee shall place a video gambling machine into operation
    |
0018|     within ten days of issuance of the permit for that machine.  A
    |
0019|     racetrack licensee shall place a slot machine into operation
    |
0020|     within ten days of issuance of the permit for that machine.  If
    |
0021|     a video gambling machine or slot machine is not placed into
    |
0022|     operation within ten days, the permit shall be canceled by the
    |
0023|     department.
    |
0024|       Section 18.  [<u>NEW MATERIAL</u>]  VIDEO GAMBLING MACHINE AND
    |
0025|     SLOT MACHINE TESTING AND INSPECTION.--
    |
0001|            A.  No video gambling machine or slot machine may be
    |
0002|     permitted without having first been tested and certified for
    |
0003|     accuracy and reliability by an independent testing laboratory
    |
0004|     approved by the department.  The costs of the testing shall be
    |
0005|     paid by the licensee.
    |
0006|            B.  No video gambling machine or slot machine may be
    |
0007|     operated if it, or the software used to control its electronic
    |
0008|     functions, has been modified in any way without having been
    |
0009|     tested after the modification and certified for accuracy and
    |
0010|     reliability by an independent testing laboratory approved by the
    |

0011|     department.
    |
0012|            C.  A licensee seeking to obtain a permit for a video
    |
0013|     gambling machine or slot machine shall pay all costs of testing
    |
0014|     the machine.
    |
0015|            D.  A permitted video gambling machine or slot
    |
0016|     machine and the premises at which it is being operated or played
    |
0017|     shall be open to inspection at all times by the department or by
    |
0018|     any law enforcement officer.  Whenever the department or any law
    |
0019|     enforcement officer has probable cause to believe that any video
    |
0020|     gambling machine or slot machine was obtained from an unlicensed
    |
0021|     manufacturer or distributor, is being operated by an unlicensed
    |
0022|     person, is unpermitted or otherwise fails to meet the
    |
0023|     requirements of the Video Gambling Act or regulations adopted
    |
0024|     pursuant to that act, he shall remove and impound the video
    |
0025|     gambling machine or slot machine for the purpose of testing and
    |
0001|     detention and shall retain possession of the machine until
    |
0002|     otherwise ordered by a district court.
    |
0003|       Section 19.  [<u>NEW MATERIAL</u>]  CONDUCT OF VIDEO GAMBLING
    |
0004|     AND SLOT MACHINE GAMBLING.--
    |
0005|            A.  No licensee shall allow access for the purpose of
    |
0006|     playing a video gambling machine or slot machine to any person
    |
0007|     who is under the age of twenty-one years.
    |
0008|            B.  No video gambling licensee shall allow access to
    |
0009|     licensed premises for the purpose of playing a video gambling
    |
0010|     machine by any person who is not an active member or a bona fide
    |
0011|     guest of an active member of the qualified organization.
    |
0012|            C.  Video gambling machines or slot machines may not
    |
0013|     be located on any licensed liquor premises unless specifically
    |
0014|     exempted by the Liquor Control Act.
    |
0015|            D.  If a video gambling machine or slot machine fails
    |
0016|     to meet specifications and requirements of the Video Gambling
    |
0017|     Act or any regulation adopted pursuant to that act at any time
    |
0018|     after a permit is issued, the licensee operating the machine
    |
0019|     shall cease operating it immediately and not operate it until it
    |
0020|     has been adjusted to meet all requirements.
    |
0021|            E.  All tables displaying prizes or awards shall be
    |
0022|     prominently displayed on each video gambling machine and slot
    |
0023|     machine.
    |
0024|            F.  A licensee may establish house rules regulating
    |
0025|     the operation and play of the video gambling machines or slot
    |
0001|     machines, provided they do not conflict with any established by
    |
0002|     the department.
    |
0003|            G.  A licensee operating a video gambling machine or
    |
0004|     slot machine shall display on the machine, or in a conspicuously
    |
0005|     visible place, the telephone number of the department that can
    |
0006|     be called to report device malfunctions or complaints.
    |
0007|       Section 20.  [<u>NEW MATERIAL</u>]  VIDEO GAMBLING MACHINE AND
    |
0008|     SLOT MACHINE REQUIREMENTS--MONITORING.--
    |
0009|            A.  A video gambling machine or slot machine operated
    |
0010|     by a licensee shall be connected to and be capable of providing
    |
0011|     the following information to the department or its contractor
    |
0012|     through the use of existing telecommunications lines and systems
    |
0013|     and through a data report or detailed tape:
    |
0014|                 (1)  the time of day in hours and minutes in
    |
0015|     which the machine is in play;
    |
0016|                 (2)  the location of the machine;
    |
0017|                 (3)  for video pull tab machines, the number of
    |
0018|     the pool of tickets or deal and the size of the pool;
    |
0019|                 (4)  the serial and permit numbers of the
    |
0020|     machine; 
    |
0021|                 (5)  the cumulative amount of money inserted
    |
0022|     into the machine at any given time;
    |
0023|                 (6)  the amount of money contained in the
    |
0024|     machine at any given time;
    |
0025|                 (7)  the amount of money, credits or other
    |
0001|     consideration paid to players by the machine at any given time;
    |
0002|                 (8)  the version number of the software running
    |
0003|     on the machine; and
    |
0004|                 (9)  other information determined by the
    |
0005|     department to be required.
    |
0006|            B.  Each licensee that operates video gambling
    |
0007|     machines or slot machines, at its own expense, shall connect all 
    |
0008|     machines to telecommunications systems and lines to allow the
    |
0009|     department or its contractor access to the information required
    |
0010|     by the Video Gambling Act and regulations adopted pursuant to
    |
0011|     that act as a condition of and prior to operating the machines. 
    |
0012|            C.  A video gambling machine and a slot machine shall
    |
0013|     contain a printer that is capable of printing a performance
    |
0014|     synopsis of the gambling played and creates an exact and
    |
0015|     identical copy of all items printed that is retained inside the
    |
0016|     machine.  A video gambling machine and a slot machine shall have
    |
0017|     electronic and mechanical meters.  The printer inside the
    |
0018|     machine shall be capable of printing the information on the
    |
0019|     meters.
    |
0020|            D.  The main logic board and the printed circuit
    |
0021|     board containing gambling erasable program read-only memory, or
    |
0022|     "EPROMs", shall be isolated in a locked area of a video gambling
    |
0023|     machine or slot machine.  The EPROMs shall be sealed to the
    |
0024|     board by the manufacturer using a process approved by the
    |
0025|     department.  The sealing shall be of a type that permits field
    |
0001|     examination of the EPROMs and permits the EPROMs to be resealed
    |
0002|     effectively.
    |
0003|            E.  A video gambling machine and a slot machine shall
    |
0004|     have a nonremovable serial number plate that provides at least
    |
0005|     the following information:
    |
0006|                 (1)  the permit number issued by the department;
    |
0007|     and
    |
0008|                 (2)  the manufacturer's name, date of
    |
0009|     manufacture and manufacturer's serial number.
    |
0010|            F.  Access to a video gambling machine and to a slot
    |
0011|     machine shall be controlled through locks.
    |
0012|            G.  A video gambling machine and a slot machine shall
    |
0013|     have surge protection and a battery backup system and shall pass
    |
0014|     a static discharge test of at least forty thousand volts.
    |
0015|            H.  A video gambling machine, other than a video pull
    |
0016|     tab machine, and a slot machine, shall allow for random play and
    |
0017|     winning. 
    |
0018|       Section 21.  [<u>NEW MATERIAL</u>]  VIDEO GAMBLING MACHINES AND
    |
0019|     SLOT MACHINES--TESTING, AUDITING AND SEIZURE.--
    |
0020|            A.  The department may by written directive require a
    |
0021|     licensee, at the licensee's expense, to have a video gambling
    |
0022|     machine or slot machine, whether or not a permit has been issued
    |
0023|     for the machine, manufactured, distributed, owned, leased or
    |
0024|     operated by that licensee tested for reliability and accuracy by
    |
0025|     an independent laboratory approved or designated by the
    |
0001|     department.  If a test is required of a machine, it shall not be
    |
0002|     operated or distributed by a licensee until it has been tested
    |
0003|     and the department is satisfied that the machine is accurate and
    |
0004|     reliable based upon the results of the test.
    |
0005|            B.  The department or its designated agents or
    |
0006|     contractors may, without advance notice to a licensee, audit or
    |
0007|     test the operation of a video gambling machine or slot machine
    |
0008|     to ensure reliability and accuracy.  A licensee shall allow
    |
0009|     access to its video gambling machines, slot machines and its
    |
0010|     licensed premises to the department or its designated agents or
    |
0011|     contractors immediately upon request. 
    |
0012|            C.  The department or its designated agents or
    |
0013|     contractors may audit all records of a licensee, whether or not
    |
0014|     they are in the licensee's possession, to ensure compliance with
    |
0015|     the provisions of the Video Gambling Act or any regulations
    |
0016|     adopted pursuant to that act.  A licensee requested to produce
    |
0017|     records relating to its video gambling machine and slot machine
    |
0018|     operations by the department, its designated agents or
    |
0019|     contractors shall do so immediately upon request.
    |
0020|            D.  The department may seize, seal or order a
    |
0021|     licensee to cease operating any or all of its video gambling
    |
0022|     machines or slot machines without prior notice if the department
    |
0023|     believes that the licensee is violating any provision of the
    |
0024|     Video Gambling Act or of any regulation adopted pursuant to that
    |
0025|     act or if any machine is not accurate or reliable or has been
    |
0001|     changed or modified in any manner not approved by the
    |
0002|     department.
    |
0003|       Section 22.  [<u>NEW MATERIAL</u>]  DENIAL, SUSPENSION OR
    |
0004|     REVOCATION OF LICENSE.--
    |
0005|            A.  The department shall refuse to issue or renew or
    |
0006|     shall suspend or revoke any license issued pursuant to the Video
    |
0007|     Gambling Act or shall fine a licensee in an amount not to exceed
    |
0008|     ten thousand dollars ($10,000) per incident, or both, upon a
    |
0009|     finding that the applicant or licensee or any officer, director,
    |
0010|     employee or agent of the applicant or licensee has:
    |
0011|                 (1)  violated any provision of the Video
    |
0012|     Gambling Act or of any regulation adopted pursuant to that act;
    |
0013|                 (2)  provided false or misleading information to
    |
0014|     the department;
    |
0015|                 (3)  been convicted of a felony involving fraud
    |
0016|     or theft or convicted of any gambling-related offense;
    |
0017|                 (4)  modified or changed any video gambling
    |
0018|     machine or slot machine so as to endanger or compromise its
    |
0019|     accuracy, security or reliability;
    |
0020|                 (5)  engaged in dishonest or deceptive practices
    |
0021|     with respect to its video gambling machine or slot machine
    |
0022|     operations; or
    |
0023|                 (6)  conducted its video gambling machine or
    |
0024|     slot machine operations in a manner that may be considered a
    |
0025|     public nuisance.
    |
0001|            B.  When the department contemplates taking any
    |
0002|     action against an applicant or licensee to refuse to issue,
    |
0003|     renew, revoke or suspend a license or impose a fine, it shall
    |
0004|     serve written notice upon the applicant or licensee containing
    |
0005|     the following:
    |
0006|                 (1)  a statement that the department has
    |
0007|     sufficient evidence that, if not rebutted or explained, will
    |
0008|     justify the department in taking the contemplated action;
    |
0009|                 (2)  a statement indicating the general nature
    |
0010|     of the evidence; and
    |
0011|                 (3)  a statement advising the applicant or
    |
0012|     licensee that, unless the applicant or licensee within twenty
    |
0013|     days after service of the notice delivers a written request for
    |
0014|     hearing to the department, the department will take the
    |
0015|     contemplated action. 
    |
0016|            C.  If the applicant or licensee does not deliver a
    |
0017|     request for hearing within the time required by this section,
    |
0018|     the department may take the action contemplated in the notice,
    |
0019|     and such action shall be final and not subject to judicial
    |
0020|     review.
    |
0021|            D.  If the applicant or licensee delivers a request
    |
0022|     for hearing within the time required by this section, the
    |
0023|     department shall, within twenty days of receipt of the request,
    |
0024|     notify the applicant or licensee of the time and place of
    |
0025|     hearing and the name of the person who shall conduct the hearing
    |
0001|     for the department, which hearing shall be held not more than
    |
0002|     sixty or less than fifteen days from the date of service of the
    |
0003|     notice of hearing.
    |
0004|            E.  All hearings under this section shall be held in
    |
0005|     Santa Fe county.
    |
0006|            F.  The department may conduct the hearings or have
    |
0007|     them conducted by a hearing officer appointed by the department.
    |
0008|            G.  All hearings shall be open to the public.
    |
0009|            H.  A licensee or applicant entitled to and
    |
0010|     requesting a hearing shall have the right to be represented by
    |
0011|     counsel, to present all relevant evidence, to examine all
    |
0012|     opposing witnesses and to have subpoenas issued by the
    |
0013|     department to compel the attendance of witnesses and the
    |
0014|     production of documents.
    |
0015|            I.  The department or hearing officer may impose any
    |
0016|     appropriate evidentiary sanction against a party who fails to
    |
0017|     provide discovery or to comply with a subpoena.
    |
0018|            J.  The department or hearing officer shall cause a
    |
0019|     complete record to be made of all evidence received during the
    |
0020|     course of a hearing. 
    |
0021|            K.  After a hearing has been completed, the
    |
0022|     department shall render its decision as soon as is practicable.
    |
0023|            L.  Any applicant or licensee who is aggrieved by an
    |
0024|     adverse decision of the department may obtain a review of the
    |
0025|     decision in the district court of Santa Fe county by filing with
    |
0001|     the court a petition for review within twenty days after the
    |
0002|     date of service of the decision.  Failure to file a petition for
    |
0003|     review in the manner and within the time stated shall operate as
    |
0004|     a waiver of the right to judicial review and shall result in the
    |
0005|     decision of the department becoming final.
    |
0006|            M.  Upon the review of any decision of the
    |
0007|     department, the district judge shall sit without a jury and may
    |
0008|     hear oral arguments and receive written briefs, but evidence not
    |
0009|     offered at the hearing shall not be taken.  The court shall
    |
0010|     affirm the decision of the department unless it finds that the
    |
0011|     substantial rights of the petitioner have been prejudiced
    |
0012|     because the decision was in violation of constitutional
    |
0013|     provisions, in excess of the statutory authority or jurisdiction
    |
0014|     of the department, made upon unlawful procedure affected by
    |
0015|     other error of law, unsupported by substantial evidence based
    |
0016|     upon a review of the entire record submitted or arbitrary or
    |
0017|     capricious.
    |
0018|            N.  Any party to the review proceeding in the
    |
0019|     district court, including the department, may appeal to the
    |
0020|     supreme court from the decision of the district court.  
    |
0021|       Section 23.  [<u>NEW MATERIAL</u>]  RECORDS REQUIRED AND RECORD
    |
0022|     RETENTION.--
    |
0023|            A.  In addition to other records required to be
    |
0024|     generated or kept pursuant to the Video Gambling Act, a licensee
    |
0025|     shall maintain complete video gambling machine and slot machine
    |
0001|     operation records, including audit tapes, and shall make them
    |
0002|     available for inspection by the department or any law
    |
0003|     enforcement officer upon request.  Those records shall include:
    |
0004|                 (1)  all permit and licensing documents issued
    |
0005|     by the department;
    |
0006|                 (2)  a complete record of all funds paid out by
    |
0007|     each machine, including the date, time and amount of the funds
    |
0008|     paid out;
    |
0009|                 (3)  a record of all gross receipts from
    |
0010|     operation of each machine by date; and
    |
0011|                 (4)  any records required by regulations adopted
    |
0012|     pursuant to the Video Gambling Act.
    |
0013|            B.  Each licensee shall maintain records required by
    |
0014|     the Video Gambling Act or any regulation adopted pursuant to
    |
0015|     that act, within this state, for a minimum period of at least
    |
0016|     three years.
    |
0017|            C.  Each applicant for a license pursuant to the
    |
0018|     Video Gambling Act or current licensee, as a condition of
    |
0019|     licensure, shall grant the department or its authorized designee
    |
0020|     access to all tax returns maintained by the United States
    |
0021|     internal revenue service or the taxation and revenue department
    |
0022|     that have been filed on behalf of any individual having any
    |
0023|     ownership, managerial, directorship or financial interest in the
    |
0024|     applicant or any activity of the licensee carried out pursuant
    |
0025|     to the Video Gambling Act, and those of any entity applying for
    |
0001|     licensure pursuant to that act.  The department shall consider
    |
0002|     those records when determining qualifications for initial
    |
0003|     licensure or actions under Section 22 of the Video Gambling Act.
    |
0004|       Section 24.  [<u>NEW MATERIAL</u>]  TAX IMPOSED--DENOMINATED AS
    |
0005|     MACHINE GAMBLING TAX--RATE--ADMINISTRATION AND ENFORCEMENT.--
    |
0006|            A.  In addition to all other taxes imposed by other
    |
0007|     state laws, an excise tax is imposed for the privilege of
    |
0008|     engaging in the activities authorized pursuant to the Video
    |
0009|     Gambling Act.  The tax is denominated as and shall be known as
    |
0010|     the "machine gambling tax".
    |
0011|            B.  The machine gambling tax is imposed in an amount
    |
0012|     equal to:
    |
0013|                 (1)  five percent of the receipts of a
    |
0014|     manufacturer from the sales of video gambling machines and slot
    |
0015|     machines manufactured in the state;
    |
0016|                 (2)  five percent of the receipts of a
    |
0017|     distributor from the distribution of video gambling machines and
    |
0018|     slot machines in the state; and
    |
0019|                 (3)  ten percent of the net receipts of a person
    |
0020|     who operates video gambling machines or slot machines, or both.
    |
0021|            C.  The machine gambling tax shall be paid to, and
    |
0022|     administered and enforced by, the taxation and revenue
    |
0023|     department pursuant to the provisions of the Tax Administration
    |
0024|     Act.
    |
0025|       Section 25.  [<u>NEW MATERIAL</u>]  PENALTIES.--A person who
    |
0001|     violates a provision of the Video Gambling Act or regulation
    |
0002|     adopted pursuant to that act is guilty of a misdemeanor and
    |
0003|     shall be sentenced pursuant to the provisions of Section 31-19-1
    |
0004|     NMSA 1978.  A person convicted pursuant to this section is
    |
0005|     prohibited from owning, operating or participating in the
    |
0006|     proceeds from the manufacture, distribution or operation of a
    |
0007|     video gambling machine or slot machine for a period of five
    |
0008|     years after the date of the conviction.
    |
0009|       Section 26.  [<u>NEW MATERIAL</u>]  FUND CREATED.--There is
    |
0010|     created in the state treasury the "machine gambling fund".  All
    |
0011|     money in the fund and all interest attributable to it is
    |
0012|     appropriated to the department for the purpose of carrying out
    |
0013|     the provisions of the Video Gambling Act.  All fees and the net
    |
0014|     receipts of the machine gambling tax paid pursuant to the Video
    |
0015|     Gambling Act or regulations adopted pursuant to that act shall
    |
0016|     be credited to the fund.  Balances in the fund at the end of a
    |
0017|     fiscal year shall revert to the general fund.
    |
0018|       Section 27.  [<u>NEW MATERIAL</u>]  SHORT TITLE.--Sections 27
    |
0019|     through 47 of this act may be cited as the "Charity Games Act".
    |
0020|       Section 28.  [<u>NEW MATERIAL</u>]  PURPOSE OF ACT.--The purpose
    |
0021|     of the Charity Games Act is to make lawful and regulate the
    |
0022|     conduct of specific games of chance by certain nonprofit
    |
0023|     organizations.  The legislature declares that the raising of
    |
0024|     funds for the promotion of certain nonprofit organizations is in
    |
0025|     the public interest as is participation in the activities
    |
0001|     authorized in that act.
    |
0002|       Section 29.  [<u>NEW MATERIAL</u>]  DEFINITIONS.--As used in the
    |
0003|     Charity Games Act:
    |
0004|            A.  "bingo" means the game commonly known as bingo in
    |
0005|     which prizes are awarded on the basis of designated numbers or
    |
0006|     symbols on a card conforming to numbers or symbols selected at
    |
0007|     random and in which no cards are sold except at the time and
    |
0008|     place of the game;
    |
0009|            B.  "bingo hall permit" means a permit issued by the
    |
0010|     department to a commercial lessor for premises that have been
    |
0011|     approved by the department for the conduct of games of chance by
    |
0012|     more than two licensed qualified organizations;
    |
0013|            C.  "commercial lessor" means a person who leases
    |
0014|     premises to two or more licensed qualified organizations for the
    |
0015|     conduct of lawful games of chance;
    |
0016|            D.  "department" means the regulation and licensing
    |
0017|     department, the superintendent of regulation and licensing or an
    |
0018|     employee of the department exercising authority lawfully
    |
0019|     delegated to that employee by the superintendent;
    |
0020|            E.  "distributor" means a person who purchases or 
    |
0021|     obtains equipment, devices or supplies used in games of chance
    |
0022|     and who sells or otherwise furnishes those items to another
    |
0023|     person for use, resale, display or operation of the equipment,
    |
0024|     devices or supplies in this state;
    |
0025|            F.  "electronic bingo" means a game in which a player
    |
0001|     uses an electronic device that simulates the numbers and symbols
    |
0002|     on a card in bingo for the opportunity to win a prize;
    |
0003|            G.  "equipment" means:
    |
0004|                 (1)  with respect to bingo, the receptacle and
    |
0005|     numbered objects drawn from it; the master board upon which the
    |
0006|     numbered objects are placed as drawn; the cards or sheets
    |
0007|     bearing numbers or other designations to be covered and the
    |
0008|     objects used to cover them; the board or signs, however
    |
0009|     operated, used to announce or display the numbers or
    |
0010|     designations as they are drawn; the public address system; and
    |
0011|     all other articles essential to the operation, conduct and
    |
0012|     playing of bingo; or
    |
0013|                 (2)  with respect to raffle, implements, devices
    |
0014|     and machines designed, intended or used for the conduct of
    |
0015|     raffle and the identification of the winning number or unit and
    |
0016|     the ticket or other evidence or right to participate in raffle;
    |
0017|            H.  "game manager" means a person, whether
    |
0018|     compensated or not, who is responsible for operating and
    |
0019|     controlling authorized games of chance and to whom a licensed
    |
0020|     qualified organization has delegated the authority to make
    |
0021|     decisions regarding the operation of the games; 
    |
0022|            I.  "game of chance" means bingo, raffle, pull tabs,
    |
0023|     electronic bingo or lottery game;
    |
0024|            J.  "gross profit" means gross receipts less the
    |
0025|     amount actually expended for prizes;
    |
0001|            K.  "gross receipts" means receipts from the sale of
    |
0002|     shares, tickets or rights in any manner connected with
    |
0003|     participation in a game of chance or the right to participate in
    |
0004|     a game of chance, including any admission fee or charge,
    |
0005|     receipts from the sale of equipment or supplies and all other
    |
0006|     miscellaneous receipts;
    |
0007|            L.  "lawful purpose" means the primary purpose for
    |
0008|     which a qualified organization is formed;
    |
0009|            M.  "lessor" means a person who leases premises to a
    |
0010|     qualified organization for the conduct of lawful games of
    |
0011|     chance;
    |
0012|            N.  "licensed premises" means premises in or on 
    |
0013|     which licensed games of chance are conducted, as approved for a
    |
0014|     licensed qualified organization by the department;
    |
0015|            O.  "licensee" means a person to whom a license under
    |
0016|     the Charity Games Act is issued by the department;
    |
0017|                 P.  "lottery game" means an instant lottery game
    |
0018|     authorized and conducted pursuant to the New Mexico Lottery Act
    |
0019|     or the Charity Games Act;
    |
0020|            Q.  "manufacturer" means a person who assembles from
    |
0021|     raw materials or subparts a completed piece of equipment or
    |
0022|     pieces of equipment, devices or supplies for conducting games of
    |
0023|     chance and who sells or furnishes the equipment, devices or
    |
0024|     supplies to a distributor and includes a person who converts,
    |
0025|     modifies, adds to or removes parts from any equipment used in a
    |
0001|     game of chance;
    |
0002|            R.  "member" means an individual who has qualified
    |
0003|     for membership in a qualified organization pursuant to its
    |
0004|     charter, articles of incorporation, bylaws, rules or other
    |
0005|     written statement, and that action is recorded in the official
    |
0006|     minutes of a regular meeting, or an individual who has held full
    |
0007|     and regular membership status in the organization for a period
    |
0008|     of not less than twelve consecutive months prior to
    |
0009|     participation in the management or operation of any games of
    |
0010|     chance pursuant to the Charity Games Act;
    |
0011|            S.  "net profit" mean gross receipts less the prizes
    |
0012|     paid, expenses, charges, fees and deductions specifically
    |
0013|     authorized pursuant to the Charity Games Act;
    |
0014|            T.  "occasion" means a single gathering or session at
    |
0015|     which a series of one or more games of chance is played;
    |
0016|            U.  "person" means an individual or other legal
    |
0017|     entity;
    |
0018|            V.  "premises" means all or the part of a building or
    |
0019|     property used for the purpose of playing a game of chance;
    |
0020|            W.  "pull tab" means a single folded or banded ticket
    |
0021|     or card, the face of which is initially covered or otherwise
    |
0022|     hidden from view to conceal one or more numbers or symbols, and
    |
0023|     the ticket or card is part of a set of tickets or cards out of
    |
0024|     which some tickets or cards have been designated prior to use in
    |
0025|     pull tabs as winning tickets or cards;
    |
0001|            X.  "pull tabs" means a game in which a person pays
    |
0002|     directly or indirectly some consideration for the opportunity to
    |
0003|     obtain a pull tab, view the numbers or symbols on it and
    |
0004|     possibly obtain a prize-winning pull tab but does not include
    |
0005|     any activity that is authorized and regulated pursuant to the
    |
0006|     New Mexico Lottery Act; 
    |
0007|            Y.  "qualified organization" means an organization
    |
0008|     described in Paragraphs (1) through (8) of this subsection that
    |
0009|     has been granted an exemption from federal income tax by the
    |
0010|     United States commissioner of internal revenue as an
    |
0011|     organization described in Section 501(c) of the Internal Revenue
    |
0012|     Code of 1986, as amended, that is exempt from state income tax
    |
0013|     pursuant to Section 7-2-4 NMSA 1978 and that is not organized or
    |
0014|     operated  primarily for the purpose of conducting gaming
    |
0015|     activities:
    |
0016|                 (1)  a charitable organization that is not
    |
0017|     organized for pecuniary profit, is operated for the relief of
    |
0018|     poverty, distress or other condition of public concern in New
    |
0019|     Mexico and has been operated for those purposes for three years
    |
0020|     immediately prior to making application for a license pursuant
    |
0021|     to the Charity Games Act;
    |
0022|                 (2)  an educational organization within the
    |
0023|     state that is not organized for pecuniary profit, has as its
    |
0024|     primary purpose an educational endeavor designed to develop the
    |
0025|     capabilities of individuals by instruction and has been in
    |
0001|     existence in New Mexico for three years immediately prior to
    |
0002|     making application for a license pursuant to the Charity Games
    |
0003|     Act;
    |
0004|                 (3)  a labor organization within the state that
    |
0005|     is not organized for pecuniary profit, exists for the sole
    |
0006|     purpose of dealing with employers on behalf of their employees
    |
0007|     concerning grievances, labor disputes, wages, rates of pay,
    |
0008|     hours of employment or conditions of work and has been in
    |
0009|     existence in New Mexico for three years immediately prior to
    |
0010|     making application for a license pursuant to the Charity Games
    |
0011|     Act; 
    |
0012|                 (4)  a voluntary firemen's organization within
    |
0013|     the state that is not organized for pecuniary profit, exists for

    |
0014|     the sole purpose of providing fire-fighting and rescue services
    |
0015|     to specific communities and has been in existence in New Mexico
    |
0016|     for three years immediately prior to making application for a
    |
0017|     license pursuant to the Charity Games Act;
    |
0018|                 (5)  an environmental organization within the
    |
0019|     state that is not organized for pecuniary profit, is primarily
    |
0020|     concerned with the protection and preservation of the natural
    |
0021|     environment and has existed in New Mexico for three years
    |
0022|     immediately prior to making application for a license pursuant
    |
0023|     to the Charity Games Act;
    |
0024|                 (6)  a religious organization, including any
    |
0025|     church, temple, synagogue or other house of worship or bona fide
    |
0001|     religious congregation within the state, that is not organized
    |
0002|     for pecuniary profit, whose members gather in common membership
    |
0003|     at a specific location on specified dates and times for mutual
    |
0004|     support and edification in piety, worship and religious
    |
0005|     observances or for religious purposes and that has existed in
    |
0006|     New Mexico for three years immediately prior to making
    |
0007|     application for a license pursuant to the Charity Games Act;
    |
0008|                 (7)  a fraternal organization within this state
    |
0009|     that is not organized for pecuniary profit and that:
    |
0010|                      (a)  is a branch, lodge or chapter of a
    |
0011|     national or state organization and exists for the common
    |
0012|     business, brotherhood or other interests of its members;
    |
0013|                      (b)  has existed in New Mexico for at
    |
0014|     least three years immediately prior to making application for a
    |
0015|     license under the Charity Games Act; and
    |

0016|                      (c)  is not a college or high school
    |
0017|     fraternity or sorority; and
    |
0018|                 (8)  a veterans' organization within this state,
    |
0019|     or any branch, lodge or chapter of a national or state
    |
0020|     organization within this state, that is not organized for
    |
0021|     pecuniary profit, the membership of which consists entirely of
    |
0022|     individuals who were members of the armed services or forces of
    |
0023|     the United States and that has been in existence in New Mexico
    |
0024|     for at least three years immediately prior to making application
    |
0025|     for a license pursuant to the Charity Games Act;
    |
0001|            Z.  "raffle" means a game in which individual tickets
    |
0002|     are sold and a prize or prizes are awarded, with the winner
    |
0003|     determined by a random drawing that takes place at a set
    |
0004|     location and date and includes door prizes but does not include
    |
0005|     any activity that is authorized and regulated under the New
    |
0006|     Mexico Lottery Act; and
    |
0007|            AA.  "substantial interest" means the interest a
    |
0008|     person has in an organization, association or business as
    |
0009|     follows:
    |
0010|                 (1)  if, with respect to a sole proprietorship,
    |
0011|     an individual or his spouse owns, operates, manages or conducts,
    |
0012|     directly or indirectly, any part of the organization,
    |
0013|     association or business;
    |
0014|                 (2)  if, with respect to a partnership, the
    |
0015|     individual or his spouse has a right to a share in any of the
    |
0016|     profits or potential profits of the partnership activities;
    |
0017|                 (3)  if, with respect to a corporation, an
    |
0018|     individual or his spouse is an officer or director of or the
    |
0019|     individual or his spouse is a holder, directly or beneficially,
    |
0020|     of five percent or more of any class of stock of the
    |
0021|     corporation;
    |
0022|                 (4)  if, with respect to an organization not
    |
0023|     covered by Paragraph (1), (2) or (3) of this subsection, an
    |
0024|     individual or his spouse is an officer or manages the business 
    |
0025|     affairs of the organization or the individual or his spouse
    |
0001|     owns, controls or has the right to control five percent or more
    |
0002|     of the assets of the organization; or
    |
0003|                 (5)  if an individual or his spouse provides ten
    |
0004|     percent or more of the capital, whether in cash, goods or
    |
0005|     services, for the operation of a business, association or
    |
0006|     organization during a calendar year.
    |
0007|       Section 30.  [<u>NEW MATERIAL</u>]  REGULATIONS.--
    |
0008|            A.  The department may make and adopt regulations
    |
0009|     necessary to implement the Charity Games Act, including
    |
0010|     regulations that establish the type, scope and manner of
    |
0011|     conducting the games of chance authorized by that act.  Except
    |
0012|     as provided in Subsection B of this section, no regulation
    |
0013|     affecting any person or agency outside the department shall be
    |
0014|     adopted, amended or repealed without a public hearing on the
    |
0015|     proposed action before the department or a designated hearing
    |
0016|     officer.  The public hearing shall be held in Santa Fe county. 
    |
0017|     Notice of the subject matter of the regulation; the date, time
    |
0018|     and place of the public hearing; the manner in which interested
    |
0019|     persons may present their views; and the method by which copies
    |
0020|     of the proposed regulation, amendment or repeal may be obtained
    |
0021|     shall be published once at least thirty days prior to the
    |
0022|     hearing date in a newspaper of general circulation.  All
    |
0023|     regulations shall be filed in accordance with the State Rules
    |
0024|     Act.
    |
0025|            B.  If the department determines that an emergency
    |
0001|     exists that requires immediate action to implement or enforce
    |
0002|     the provisions of the Charity Games Act, it may adopt a
    |
0003|     regulation or amend or repeal a regulation without notice and
    |
0004|     hearing, and the emergency action shall be effective immediately
    |
0005|     upon its filing pursuant to the State Rules Act.  The emergency
    |
0006|     action shall not continue in effect longer than forty-five days
    |
0007|     unless within that time the department commences proceedings to
    |
0008|     ratify the emergency action by issuing the notice required in
    |
0009|     Subsection A of this section.  If the department commences
    |
0010|     proceedings by issuing the notice, the emergency action shall
    |
0011|     remain in effect until ratified or until the procedures are
    |
0012|     otherwise completed.
    |
0013|            C.  Regulations adopted by the department may include
    |
0014|     any provisions the department deems appropriate to ensure the
    |
0015|     integrity, honesty and security of the conduct of games of
    |
0016|     chance.
    |
0017|       Section 31.  [<u>NEW MATERIAL</u>]  ORGANIZATIONS AND PERSONS
    |
0018|     ELIGIBLE FOR LICENSES--FEES.--
    |
0019|            A.  A qualified organization that has had, since the
    |
0020|     date of filing an application for a license pursuant to the
    |
0021|     Charity Games Act and during the entire three-year period
    |
0022|     preceding the filing of its application, an active membership
    |
0023|     engaged in carrying out the objects of the organization may be
    |
0024|     issued a license by the department pursuant to the Charity Games
    |
0025|     Act if it complies with all requirements for the licensure
    |
0001|     pursuant to that act and regulations adopted by the department.
    |
0002|            B.  Manufacturers, distributors, commercial lessors
    |
0003|     and game managers who comply with the requirements of the
    |
0004|     Charity Games Act and regulations of the department may be
    |
0005|     issued licenses pursuant to the Charity Games Act.
    |
0006|            C.  No manufacturer, distributor or commercial lessor
    |
0007|     or any person who has a substantial interest in a manufacturer,
    |
0008|     distributor or commercial lessor may be a game manager.
    |
0009|            D.  The department shall adopt regulations
    |
0010|     establishing licensing fees.  The amount of the fees shall bear
    |
0011|     a direct relationship to the costs estimated to be incurred by
    |
0012|     the department in administering the Charity Games Act.  The
    |
0013|     department may establish different classes of licenses within a
    |
0014|     category of license and may provide for different fees for the
    |
0015|     different classes.  License fees may be based on the estimated
    |
0016|     gross receipts of the licensee.  Fees for the following licenses
    |
0017|     shall not exceed the indicated amounts:
    |
0018|                 (1)  commercial lessor, two hundred fifty
    |
0019|     dollars ($250);
    |
0020|                 (2)  bingo hall permits, five hundred dollars
    |
0021|     ($500); and
    |
0022|                 (3)  game manager, one hundred dollars ($100).
    |
0023|            E.  The holder of any license issued pursuant to the
    |
0024|     Charity Games Act has no vested property right in the license. 
    |
0025|     The license is the property of the state.  Licenses issued
    |
0001|     pursuant to the Charity Games Act are not subject to sale,
    |
0002|     lease, devise, transfer, assignment, execution, attachment, a
    |
0003|     security transaction, liens or receivership.
    |
0004|            F.  All licenses issued pursuant to the Charity Games
    |
0005|     Act shall be issued for a period of two years. 
    |
0006|            G.  In addition to basic license or permit fees, the
    |
0007|     department may require additional fees of manufacturers,
    |
0008|     distributors and commercial lessors necessary to defray the
    |
0009|     costs of background investigations, including but not limited to
    |
0010|     costs for applicants for whom background information is not
    |
0011|     readily available.  The department shall adopt regulations for
    |
0012|     the assessment and reasonable notice of time for payment of the
    |
0013|     additional fees.
    |
0014|            H.  The department may issue temporary or provisional
    |
0015|     licenses for periods not to exceed sixty days.
    |
0016|       Section 32.  [<u>NEW MATERIAL</u>]  APPLICATION FOR LICENSE--GENERAL PROVISIONS GOVERNING LICENSURE.--
    |
0017|            A.  Any person seeking licensure pursuant to the
    |
0018|     Charity Games Act shall submit an application to the department
    |
0019|     on forms provided by the department.  The application shall
    |
0020|     contain information required by regulation of the department. 
    |
0021|     In addition to the information required on the application form,
    |
0022|     the department may require the applicant to furnish additional
    |
0023|     information the department deems necessary to fulfill the
    |
0024|     purposes and requirements of the Charity Games Act.
    |
0025|            B.  An applicant for a license shall, during pendency
    |
0001|     of the application, notify the department immediately of any
    |
0002|     change respecting any facts set forth in the application.  A
    |
0003|     change occurring after the issuance of a license shall be
    |
0004|     reported to the department within ten days of the date of the
    |
0005|     change.  A licensee shall notify the department of a change in
    |
0006|     its organization, structure or mode of operation or a change in
    |
0007|     the identity of or the nature or extent of an interest held by
    |
0008|     persons named or required to be named in the application. 
    |
0009|     Failure to give a required notice of change is cause for denial
    |
0010|     of an application for a license or suspension or revocation of a
    |
0011|     license that has been issued. 
    |
0012|            C.  The department may require fingerprinting of and
    |
0013|     background checks on any person seeking licenses pursuant to the
    |
0014|     Charity Games Act, any person holding an interest in games of
    |
0015|     chance or a building or equipment to be used for conducting
    |
0016|     games of chance or any person participating as an employee in
    |
0017|     the operation of games of chance.  The department may establish
    |
0018|     and assess fees to defray the expenses of fingerprinting and
    |
0019|     conducting background checks.
    |
0020|       Section 33.  [<u>NEW MATERIAL</u>]  QUALIFIED ORGANIZATION
    |
0021|     LICENSE.--
    |
0022|            A.  A license may be issued to a qualified
    |
0023|     organization to conduct games of chance.
    |
0024|            B.  A qualified organization shall designate in its
    |
0025|     license application a game manager and up to two assistant game
    |
0001|     managers, who shall be members of the organization, designated
    |
0002|     as responsible for the conduct of the games of chance on each
    |
0003|     occasion.
    |
0004|            C.  A qualified organization shall designate in its
    |
0005|     license application a member of the organization to be the
    |
0006|     financial officer in full charge and primarily responsible for
    |
0007|     the proper distribution of the organization's net profits in
    |
0008|     accordance with the Charity Games Act.
    |
0009|            D.  An applicant for a qualified organization license
    |
0010|     shall have at the time of application and licensing at least
    |
0011|     twenty-five members. 
    |
0012|            E.  An applicant for a qualified organization license
    |
0013|     shall not have as an officer or member of its governing body any
    |
0014|     person who, within two years prior to issuance of the license,
    |
0015|     has had a license issued by the department revoked for a
    |
0016|     violation of law or department regulations.
    |
0017|            F.  If premises are to be leased or rented by the
    |
0018|     qualified organization applying for a license, a copy of the
    |
0019|     lease or rental agreement shall be provided with the
    |
0020|     application.
    |
0021|       Section 34.  [<u>NEW MATERIAL</u>]  COMMERCIAL LESSOR'S
    |
0022|     LICENSE.--
    |
0023|            A.  A commercial lessor's license may be issued to a
    |
0024|     person desiring to lease premises to more than one qualified
    |
0025|     organization.  No person may lease premises to more than one
    |
0001|     qualified organization for the conduct of games of chance unless
    |
0002|     the person has a commercial lessor's license for the premises to
    |
0003|     be leased.  A lessor may not lease premises for the conduct of
    |
0004|     games of chance at more than one location without a separate
    |
0005|     commercial lessor's license for each location.  The department
    |
0006|     may issue one or more commercial lessor's licenses to a person
    |
0007|     who applies and complies with the requirements for licensure
    |
0008|     contained in the Charity Games Act and department regulations.
    |
0009|            B.  The following persons are not eligible for a
    |
0010|     commercial lessor's license:
    |
0011|                 (1)  an elected or appointed public officer or
    |
0012|     employee;
    |
0013|                 (2)  a person who extends credit to, loans money
    |
0014|     to or pays or provides for the payment of license fees for a
    |
0015|     qualified organization; or
    |
0016|                 (3)  a person married or related in the first
    |
0017|     degree by consanguinity or affinity to one of those persons
    |
0018|     listed in Paragraph (1) or (2) of this subsection.
    |
0019|            C.  No commercial lessor may lease premises to more
    |
0020|     than seven licensed qualified organizations for the conduct of
    |
0021|     games of chance.
    |
0022|            D.  No lessor or commercial lessor shall directly or
    |
0023|     indirectly:
    |
0024|                 (1)  provide to the players, patrons, spectators
    |
0025|     or charitable organization members or workers present at the
    |
0001|     lessor's premises anything of economic value in the form of a
    |
0002|     gift or prize, regardless of whether or not compensation is
    |
0003|     required for receipt of the prize or gift;
    |
0004|                 (2)  loan money to a qualified organization to
    |
0005|     which premises are leased, but a lessor or commercial lessor may
    |
0006|     forebear or reduce the rent to an amount less than the amount
    |
0007|     stipulated by written lease as the lessor or commercial lessor
    |
0008|     does not reclaim the amount of any reduction or forbearance; or
    |
0009|                 (3)  sell, donate or otherwise distribute rights
    |
0010|     of participation in any game of chance.
    |
0011|            E.  No lessor, commercial lessor or an employee or
    |
0012|     agent of a lessor or commercial lessor, and no owner of premises
    |
0013|     or any person having a substantial interest in the owner, lessor
    |
0014|     or commercial lessor, shall take part in, share in the proceeds
    |
0015|     from the conduct of or assist with the holding, operating or
    |
0016|     conduct of a game of chance.  The department may by regulation
    |
0017|     further define or list the types of activity that constitute
    |
0018|     prohibited participation in the conduct of a game of chance.
    |
0019|            F.  The department shall issue bingo hall permits in
    |
0020|     accordance with regulations.
    |
0021|            G.  No lessor, commercial lessor or person having a
    |
0022|     substantial interest in a lessor or commercial lessor shall:
    |
0023|                 (1)  serve as an officer, director or member of
    |
0024|     the governing body of any licensed qualified organization that
    |
0025|     rents, leases or uses the premises of the lessor or commercial
    |
0001|     lessor for conducting games of chance; or
    |
0002|                 (2)  provide accounting services to a licensed
    |
0003|     qualified organization conducting games of chance on premises
    |
0004|     leased from the lessor or commercial lessor.
    |
0005|            H.  No lease or contract between a qualified
    |
0006|     organization licensee and a lessor or commercial lessor shall
    |
0007|     provide for consideration based upon a percentage or share in
    |
0008|     the proceeds from the conduct of any game of chance by the
    |
0009|     qualified organization licensee.
    |
0010|       Section 35.  [<u>NEW MATERIAL</u>]  MANUFACTURER'S AND
    |
0011|     DISTRIBUTOR'S LICENSES.--
    |
0012|            A.  No person may sell, supply or store for the
    |
0013|     purpose of sale to a person in this state or for use in this
    |
0014|     state supplies, devices or equipment designed to be used in
    |
0015|     playing games of chance or engage in any intrastate activities
    |
0016|     involving those items, unless the manufacturer or distributor
    |
0017|     has a current manufacturer's or distributor's license issued by
    |
0018|     the department. 
    |
0019|            B.  An applicant for a manufacturer's or
    |
0020|     distributor's license shall file with the department a written
    |
0021|     application on a form prescribed by the department.
    |
0022|            C.  The following persons are not eligible for a
    |
0023|     manufacturer's or distributor's license:
    |
0024|                 (1)  an elected or appointed public officer or
    |
0025|     public employee;
    |
0001|                 (2)  a person who conducts, promotes or
    |
0002|     administers or assists in conducting, promoting or administering
    |
0003|     games of chance for which a license is required by the Charity
    |
0004|     Games Act;
    |
0005|                 (3)  a person who has had a license to
    |
0006|     manufacture or distribute gaming equipment, devices or supplies
    |
0007|     revoked by another state within one year preceding the date of
    |
0008|     application; or
    |
0009|                 (4)  an individual related in the first degree
    |
0010|     by consanguinity or affinity to an individual ineligible to
    |
0011|     receive a license pursuant to the Charity Games Act.
    |
0012|            D.  The Charity Games Act does not apply to
    |
0013|     manufacturers or distributors licensed by the New Mexico lottery
    |
0014|     authority who do not sell or supply or offer to sell or supply
    |
0015|     equipment, devices or supplies for use by licensed qualified
    |
0016|     organizations.
    |
0017|            E.  No manufacturer or distributor shall solicit
    |
0018|     sales or sell or ship equipment for games of chance for use or
    |
0019|     storage in this state before a license is issued to the
    |
0020|     manufacturer or distributor by the department.
    |
0021|            F.  No distributor shall rent or lease equipment to a
    |
0022|     licensed qualified organization on an income-sharing basis or on
    |
0023|     a percentage-of-income-sharing basis.
    |
0024|       Section 36.  [<u>NEW MATERIAL</u>]  GAME MANAGER'S LICENSE.--
    |
0025|            A.  All games of chance conducted by a licensed
    |
0001|     qualified organization shall be under the supervision of a game
    |
0002|     manager or assistant game manager.  A game manager designated by
    |
0003|     an organization is responsible for the gross receipts of the
    |
0004|     organization and for the conduct of all games of chance in
    |
0005|     compliance with all laws and regulations.
    |
0006|            B.  A licensed qualified organization may not have
    |
0007|     more than one game manager and two assistant game managers at
    |
0008|     any time.
    |
0009|            C.  A person may not serve as a game manager for a
    |
0010|     licensed qualified organization unless the person possesses a
    |
0011|     valid game manager's license issued by the department.  The
    |
0012|     department shall not issue a game manager's license to a person
    |
0013|     who is a manufacturer, distributor, lessor, commercial lessor or
    |
0014|     person having a substantial financial interest in a
    |
0015|     manufacturer, distributor, lessor or commercial lessor.
    |
0016|            D.  The department may by regulation require all game
    |
0017|     managers to receive training prior to assuming the duties of a
    |
0018|     game manager and periodic training regarding the laws and 
    |
0019|     regulations governing lawful games of chance.
    |
0020|       Section 37.  [<u>NEW MATERIAL</u>]  DENIAL, SUSPENSION OR
    |
0021|     REVOCATION OF LICENSE.--
    |
0022|            A.  If, for reasons beyond the control of the
    |
0023|     department, sufficient information is not available to allow the
    |
0024|     department to determine the eligibility of an applicant for a 
    |
0025|     license authorized to be issued pursuant to the Charity Games
    |
0001|     Act, the department may deny the application unless and until
    |
0002|     the applicant provides the required information.
    |
0003|            B.  The department shall deny an application, or
    |
0004|     suspend or revoke any license or permit issued by it, if the
    |
0005|     applicant or licensee or any person with a substantial interest
    |
0006|     in the applicant or licensee:
    |
0007|                 (1)  has ever been convicted of a felony or any
    |
0008|     offense punishable by one year or more in prison, a crime
    |
0009|     involving gambling or assault or a criminal violation involving
    |
0010|     the use of a firearm;
    |
0011|                 (2)  has violated, failed or refused to comply
    |
0012|     with the provisions, requirements, conditions, limitations or
    |
0013|     duties imposed by the Charity Games Act or any regulation
    |
0014|     adopted by the department pursuant to that act;
    |
0015|                 (3)  knowingly causes, aids, abets or conspires
    |
0016|     with another to cause any person to violate any of the
    |
0017|     provisions of the Charity Games Act or the regulations of the
    |
0018|     department adopted pursuant to that act;
    |
0019|                 (4)  has obtained a license or permit by fraud,
    |
0020|     misrepresentation, concealment or through inadvertence or
    |
0021|     mistake;
    |
0022|                 (5)  has been convicted of or forfeited bond
    |
0023|     upon a charge of or pleaded guilty to forgery, larceny,
    |
0024|     extortion, conspiracy to defraud, willful failure to make
    |
0025|     required payments or reports to a governmental agency at any
    |
0001|     level, filing false reports therewith, any similar offense or
    |
0002|     offenses, bribing or otherwise unlawfully influencing a public
    |
0003|     official or employee of any state or the United States or any
    |
0004|     crime, whether a felony or misdemeanor, involving any game of
    |
0005|     chance or physical harm to individuals or involving moral
    |
0006|     turpitude;
    |
0007|                 (6)  makes a misrepresentation of or fails to
    |
0008|     disclose a material fact to the department;
    |
0009|                 (7)  if a qualified organization, has failed to
    |
0010|     earn a net profit during any calendar year from the conduct of
    |
0011|     games of chance; or
    |
0012|                 (8)  is subject to current prosecution for any
    |
0013|     offense described in Paragraphs (1) through (6) of this
    |
0014|     subsection.
    |
0015|            C.  If any license is revoked, the holder of the
    |
0016|     revoked license is not eligible to apply for another license
    |
0017|     until after the expiration of the period of one year from the
    |
0018|     date of such revocation or such longer period of time as the
    |
0019|     department may reasonably determine, not to exceed five years. 
    |
0020|     The licensee shall be notified in writing at the time of
    |
0021|     revocation of the period of ineligibility and the reasons for
    |
0022|     the determination.
    |
0023|            D.  When the department contemplates taking any
    |
0024|     action against an applicant or licensee to refuse to issue or
    |
0025|     renew or to revoke or suspend a license, it shall serve written
    |
0001|     notice upon the applicant or licensee containing the following:
    |
0002|                 (1)  a statement that the department has
    |
0003|     sufficient evidence, which if not rebutted or explained, will
    |
0004|     justify the department in taking the contemplated action;
    |
0005|                 (2)  a statement indicating the general nature
    |
0006|     of the evidence; and
    |
0007|                 (3)  a statement advising the applicant or
    |
0008|     licensee that unless the applicant or licensee within twenty
    |
0009|     days after service of the notice delivers a written request for
    |
0010|     hearing to the department, the department will take the
    |
0011|     contemplated action. 
    |
0012|            E.  If the applicant or licensee does not deliver a
    |
0013|     request for hearing within the time required by this section,
    |
0014|     the department may take the action contemplated in the notice,
    |
0015|     and such action shall be final and not subject to judicial
    |
0016|     review.
    |
0017|            F.  If the applicant or licensee delivers a request
    |
0018|     for hearing within the time required by this section, the
    |
0019|     department shall, within twenty days of receipt of the request,
    |
0020|     notify the applicant or licensee of the time and place of
    |
0021|     hearing and the name of the person who shall conduct the hearing
    |
0022|     for the department, which hearing shall be held not more than
    |
0023|     sixty nor less than fifteen days from the date of service of the
    |
0024|     notice of hearing.
    |
0025|            G.  All hearings under this section shall be held in
    |
0001|     Santa Fe county.
    |
0002|            H.  The department may conduct the hearings or have
    |
0003|     them conducted by a hearing officer appointed by the department.
    |
0004|            I.  All hearings shall be open to the public.
    |
0005|            J.  A licensee or applicant entitled to and
    |
0006|     requesting a hearing shall have the right to be represented by
    |
0007|     counsel, to present all relevant evidence, to examine all
    |
0008|     opposing witnesses and to have subpoenas issued by the
    |
0009|     department to compel the attendance of witnesses and the
    |
0010|     production of documents.
    |
0011|            K.  The department or hearing officer may impose any
    |
0012|     appropriate evidentiary sanction against a party who fails to
    |
0013|     provide discovery or to comply with a subpoena.
    |
0014|            L.  The department or hearing officer shall cause a
    |
0015|     complete record to be made of all evidence received during the
    |
0016|     course of a hearing.  
    |
0017|            M.  After a hearing has been completed, the
    |
0018|     department shall render its decision as soon as is practicable.
    |
0019|            N.  Any applicant or licensee who, after a properly
    |
0020|     requested hearing, is aggrieved by an adverse decision of the
    |
0021|     department may obtain a review of the decision in the district
    |
0022|     court of Santa Fe county by filing with the court a petition for
    |
0023|     review within twenty days after the date of service of the
    |
0024|     decision.  Failure to file a petition for review in the manner
    |
0025|     and within the time stated shall operate as a waiver of the
    |
0001|     right to judicial review and shall result in the decision of the
    |
0002|     department becoming final.
    |
0003|            O.  Upon the review of any decision of the
    |
0004|     department, the district judge shall sit without a jury and may
    |
0005|     hear oral arguments and receive written briefs, but evidence not
    |
0006|     offered at the hearing shall not be taken.  The court shall
    |
0007|     affirm the decision of the department unless it finds that the
    |
0008|     substantial rights of the petitioner have been prejudiced
    |
0009|     because the decision was in violation of constitutional
    |
0010|     provisions in excess of the statutory authority or jurisdiction
    |
0011|     of the department, made upon unlawful procedure, affected by
    |
0012|     other error of law unsupported by substantial evidence based
    |
0013|     upon a review of the entire record submitted, arbitrary or
    |
0014|     capricious.
    |
0015|            P.  Any party to the review proceeding in the
    |
0016|     district court, including the department, may appeal to the
    |
0017|     supreme court from the decision of the district court.  
    |
0018|       Section 38.  [<u>NEW MATERIAL</u>]  CONDUCT OF GAMES--PREMISES--EQUIPMENT--GENERAL PROVISIONS.--
    |
0019|            A.  A qualified organization holding a current
    |
0020|     qualified organization license pursuant to the Charity Games Act
    |
0021|     may conduct the following specific games of chance as defined
    |
0022|     and restricted by the Charity Games Act and the regulations of
    |
0023|     the department:
    |
0024|                 (1)  bingo;
    |
0025|                 (2)  pull tabs;
    |
0001|                 (3)  electronic bingo;
    |
0002|                 (4)  raffle; or
    |
0003|                 (5)  lottery game.
    |
0004|            B.  Each license issued to a qualified organization
    |
0005|     shall be in a form prescribed by the department and shall be
    |
0006|     conspicuously displayed at the place where any game of chance is
    |
0007|     being conducted at all times during the conduct of the game and
    |
0008|     for at least thirty minutes after the last game has been
    |
0009|     concluded or the premises are vacated, whichever is earlier.
    |
0010|            C.  A licensed qualified organization may not conduct
    |
0011|     games of chance at any location other than the single location
    |
0012|     approved as its licensed premises by the department, except as
    |
0013|     follows:
    |
0014|                 (1)  upon prior written approval of the
    |
0015|     department, the licensee may conduct one of its sessions of
    |
0016|     games of chance each year at a temporary location for a special
    |
0017|     event or similar purpose; and 
    |
0018|                 (2)  a veterans' organization that is a licensee
    |
0019|     pursuant to the Charity Games Act and whose licensed premises is
    |
0020|     located in a bingo hall may obtain from the department a
    |
0021|     separate permit authorizing the sale of paper pull tabs at its
    |
0022|     chapter or post location, provided that the chapter or post
    |
0023|     location is restricted to members and bona fide guests of the
    |
0024|     members of the licensee organization.
    |
0025|            D.  No person shall hold, operate or conduct any game
    |
0001|     of chance under a qualified organization license issued pursuant
    |
0002|     to the Charity Games Act except under the supervision of a
    |
0003|     licensed game manager.  The game manager and any assistant game
    |
0004|     managers shall be active members of the qualified organization
    |
0005|     licensed to conduct games of chance, except that a game manager
    |
0006|     licensed pursuant to the Charity Games Act may supervise games
    |
0007|     for licensed qualified organizations other than the organization
    |
0008|     of which he is a member.  The department shall be notified in
    |
0009|     writing of a change in game managers.  Notification shall be
    |
0010|     made prior to the date that the new game manager assumes the
    |
0011|     prior game manager's duties.  The game manager or assistant game
    |
0012|     manager shall supervise all activities on the occasion for which
    |
0013|     he is in charge and be responsible for making all reports
    |
0014|     required of the conduct of games and accounting for gross
    |
0015|     receipts.
    |
0016|            E.  No person shall assist in the holding, operating
    |
0017|     or conducting of any games of chance pursuant to a qualified
    |
0018|     organization license except an active member of the licensee or
    |
0019|     a member of an organization or association that is an auxiliary

    |
0020|     to the licensee, a member of an organization or association of
    |
0021|     which the licensee is an auxiliary or a member of an
    |
0022|     organization or association that is affiliated with the licensee
    |
0023|     by being, with it, auxiliary to another organization or
    |
0024|     association.  This provision does not prohibit bookkeepers and
    |
0025|     accountants from assisting in preparation of required financial
    |
0001|     reports.
    |
0002|            F.  No item of expense shall be incurred or paid in
    |
0003|     connection with the holding, operating or conducting of any game
    |
0004|     of chance held, operated or conducted pursuant to any license
    |
0005|     issued pursuant to the Charity Games Act except bona fide
    |
0006|     expenses in a reasonable amount for goods, wares and merchandise
    |
0007|     furnished or services rendered reasonably necessary for the
    |
0008|     holding, operating or conducting of the games of chance.
    |
0009|            G.  The premises where any game of chance is being
    |
0010|     held, operated or conducted or where it is intended that any
    |
0011|     equipment be used shall at all times be open to inspection by 
    |
0012|     the department, its agents and employees and by peace officers.
    |
0013|            H.  No licensed qualified organization may obtain by
    |
0014|     purchase or any other manner equipment, devices or supplies from
    |
0015|     a person other than a distributor licensed pursuant to the
    |
0016|     Charity Games Act, except that a licensed qualified organization
    |
0017|     may make an occasional sale of equipment or supplies to another
    |
0018|     licensed qualified organization with the prior written
    |
0019|     permission of the department.  No game of chance shall be
    |
0020|     conducted with any equipment except that which is owned or
    |
0021|     leased by the licensee.
    |
0022|            I.  No game of chance shall be conducted more than
    |
0023|     five times in any one calendar week, with no game lasting more
    |
0024|     than four hours on each occasion and not more than two 
    |
0025|     occasions in one calendar day by any one licensee.
    |
0001|            J.  No alcoholic beverages may be dispensed, sold or
    |
0002|     consumed on any premises authorized for the conduct of lawful
    |
0003|     games of chance, except on the premises of licensed qualified
    |
0004|     organizations that are veterans' or fraternal organizations
    |
0005|     that:
    |
0006|                 (1)  hold a current club liquor license for such
    |
0007|     premises pursuant to the Liquor Control Act; and
    |
0008|                 (2)  restrict admittance to the premises
    |
0009|     licensed pursuant to the Charity Games Act and the Liquor
    |
0010|     Control Act exclusively to members of the organization and bona
    |
0011|     fide guests of the members who are twenty-one years of age or
    |
0012|     older. 
    |
0013|       Section 39.  [<u>NEW MATERIAL</u>]  TAX IMPOSED--DENOMINATED AS
    |
0014|     CHARITY GAMES TAX--RATE--ADMINISTRATION AND ENFORCEMENT.--
    |
0015|            A.  In addition to other taxes imposed by other state
    |
0016|     laws, an excise tax is imposed for the privilege of engaging in
    |
0017|     the activity of commercial leasing for the conduct of charity
    |
0018|     games authorized pursuant to the Charity Games Act.  The tax is
    |
0019|     denominated as and shall be known as the "charity games tax".
    |
0020|            B.  The charity games tax is imposed in an amount
    |
0021|     equal to ten percent of the receipts of a commercial lessor
    |
0022|     received pursuant to a contract or lease with a licensed
    |
0023|     qualified organization under which premises are leased, rented
    |
0024|     or provided to the licensed qualified organization for the
    |
0025|     conduct of games of chance authorized pursuant to the Charity
    |
0001|     Games Act.
    |
0002|            C.  The charity games tax shall be paid to and
    |
0003|     administered and enforced by the taxation and revenue department
    |
0004|     pursuant to the provisions of the Tax Administration Act.
    |
0005|       Section 40.  [<u>NEW MATERIAL</u>]  REPORTING REQUIREMENTS.--
    |
0006|            A.  Every qualified organization licensed to conduct
    |
0007|     games of chance and every applicant for a qualified organization
    |
0008|     license shall file quarterly reports, an annual financial report
    |
0009|     and an annual activity report containing the information
    |
0010|     required by department regulations.  The information required by
    |
0011|     the department may include the information deemed necessary by
    |
0012|     the department to fully disclose the eligibility and ability of
    |
0013|     the organization to lawfully conduct games of chance, the
    |
0014|     participants in the operation of games of chance, the amount
    |
0015|     of gross receipts, gross profit and net profit, the distribution
    |
0016|     and utilization of all revenue from games of chance, the
    |
0017|     organization's progress in fulfillment of the purposes of the
    |
0018|     organization and the organization's compliance with the Charity
    |
0019|     Games Act.  The department may take into account the nature and
    |
0020|     extent of the games of chance conducted or to be conducted by
    |
0021|     the licensee or applicant or otherwise in determining the extent
    |
0022|     of information required.  Each licensed qualified organization
    |
0023|     or applicant for a qualified organization license shall maintain
    |
0024|     and keep the books and records necessary to substantiate the
    |
0025|     particulars of each report.
    |
0001|            B.  Every manufacturer and distributor shall file
    |
0002|     quarterly reports providing information required by regulation
    |
0003|     of the department.
    |
0004|            C.  Every commercial lessor shall file semiannual
    |
0005|     reports providing information required by regulation of the
    |
0006|     department.
    |
0007|       Section 41.  [<u>NEW MATERIAL</u>]  ACCOUNTING BY QUALIFIED
    |
0008|     ORGANIZATIONS--ALLOWABLE EXPENSES--GAME ACCOUNTS.--
    |
0009|            A.  All money collected or received from the sale of
    |
0010|     admission, extra regular cards, special game cards, supplies and
    |
0011|     all other receipts from the conduct of games of chance shall be
    |
0012|     deposited in a special game account of the licensee, which shall
    |
0013|     contain only such money.  All expenses for the game shall be
    |
0014|     withdrawn and paid directly from the game account by
    |
0015|     consecutively numbered checks duly signed by specified officers
    |
0016|     of the licensee and payable to a specific person or
    |
0017|     organization.  There shall be written on the check the nature of
    |
0018|     the expense for which the check is drawn.  No check shall be
    |
0019|     drawn to "cash" or a fictitious payee.
    |
0020|            B.  Gross profits from games of chance may only be
    |
0021|     spent for allowable expenses or lawful purposes.  Expenses may
    |
0022|     be incurred only for the following purposes:
    |
0023|                 (1)  the purchase of goods, wares and
    |
0024|     merchandise furnished;
    |
0025|                 (2)  payment for services rendered that are
    |
0001|     reasonably necessary for repairs of equipment owned by the
    |
0002|     licensee or operating or conducting games of chance;
    |
0003|                 (3)  rent if the premises are rented or for
    |
0004|     janitorial services if not rented;
    |
0005|                 (4)  reasonable accountants' fees and bank
    |
0006|     charges;
    |
0007|                 (5)  utilities that are not included in rent,
    |
0008|     such as telephone;
    |
0009|                 (6)  license fees and federal or state taxes
    |
0010|     imposed on gross receipts and on income from conducting games of
    |
0011|     chance pursuant to the Charity Games Act; and
    |
0012|                 (7)  the reasonable costs of an audit required
    |
0013|     by the department if the cost is approved by the department in
    |
0014|     writing.
    |
0015|            C.  All of the net profits derived from the holding
    |
0016|     of games of chance shall be devoted to the lawful purposes of
    |
0017|     the qualified organization licensed to conduct the games.  
    |
0018|            D.  The department may by regulation establish the
    |
0019|     maximum amounts that may be expended for the allowable expenses
    |
0020|     specified in Subsection B of this section.
    |
0021|       Section 42.  [<u>NEW MATERIAL</u>]  CONFIDENTIAL INFORMATION.--
    |
0022|            A.  The following information shall not be considered
    |
0023|     public record and is not subject to inspection under the
    |
0024|     Inspection of Public Records Act and shall not be revealed by
    |
0025|     the department except under order of a court of competent
    |
0001|     jurisdiction or with written permission of the owner or provider
    |
0002|     of the information:
    |
0003|                 (1)  technical manuals, instructions or wiring
    |
0004|     or logic diagrams for the machine;
    |
0005|                 (2)  listings of source codes and flow charts;
    |
0006|                 (3)  results of simulations and related
    |
0007|     information explaining simulation methodology;
    |
0008|                 (4)  model EPROMs or logic boards containing
    |
0009|     compiled programs; and
    |
0010|                 (5)  tax returns received from the internal
    |
0011|     revenue service or the taxation and revenue department.
    |
0012|            B.  Information relating to the results of actual
    |
0013|     operations as shown on a machine's meter is not confidential and
    |
0014|     may be used to compile studies or reports.
    |
0015|            C.  Persons with access to confidential information
    |
0016|     as described in Subsection A of this section may not use or
    |
0017|     reveal anything of a confidential nature outside the scope of
    |
0018|     its intended purpose.
    |
0019|            D.  The department shall secure confidential
    |
0020|     information and restrict all persons from access, except
    |
0021|     designated employees whose duties include testing and
    |
0022|     interpretation of the information.  Such information is not
    |
0023|     public record and may not be released to any member of the
    |
0024|     public.
    |
0025|       Section 43.  [<u>NEW MATERIAL</u>]  EXAMINATION OF BOOKS AND
    |
0001|     RECORDS.--
    |
0002|            A.  The premises, equipment and all the books and
    |
0003|     records of any person or organization conducting games of chance
    |
0004|     authorized by the Charity Games Act and any person or
    |
0005|     organization receiving profits therefrom or having any interest
    |
0006|     therein shall be subject to inspection and audit at any
    |
0007|     reasonable time, with or without notice, upon demand, by the
    |
0008|     department, the secretary of public safety or his designee or
    |
0009|     the chief of police or the district attorney of any city, town
    |
0010|     or county in which the person or organization is located, for
    |
0011|     the purpose of determining compliance or noncompliance with the
    |
0012|     provisions of the Charity Games Act and any regulations or local
    |
0013|     ordinances incident thereto.
    |
0014|            B.  Licensees shall provide any reports or records to
    |
0015|     the department relating to their activities pursuant to the
    |
0016|     Charity Games Act upon request. 
    |
0017|       Section 44.  [<u>NEW MATERIAL</u>]  ACCESS TO INTERNAL REVENUE
    |
0018|     SERVICE INFORMATION.--Each applicant for a license pursuant to
    |
0019|     the Charity Games Act or current licensee, as a condition of
    |
0020|     licensure, shall grant the department or its authorized designee
    |
0021|     access to all tax returns maintained by the internal revenue
    |
0022|     service or the taxation and revenue department that have been
    |
0023|     filed on behalf of any individual having any ownership,
    |
0024|     managerial, directorship or financial interest in the applicant
    |
0025|     or the conduct of games of chance by the licensee and those of
    |
0001|     any entity applying for licensure under that act.  The
    |
0002|     department shall consider those records when determining
    |
0003|     qualifications for initial licensure or other actions under the
    |
0004|     Charity Games Act.
    |
0005|       Section 45.  [<u>NEW MATERIAL</u>]  PENALTIES.--
    |
0006|            A.  Every licensee; every officer, agent or employee
    |
0007|     of the licensee; and every other person or corporation who
    |
0008|     willfully violates or who procures, aids or abets in the willful
    |
0009|     violation of the Charity Games Act by making false statements or
    |
0010|     material omissions in any application or report filed with the
    |
0011|     department is guilty of a fourth degree felony and shall be
    |
0012|     sentenced pursuant to the provisions of Section 31-18-15 NMSA
    |
0013|     1978.
    |
0014|            B.  Any person who violates any other provision of
    |
0015|     the Charity Games Act or regulations adopted pursuant to that
    |
0016|     act is guilty of a misdemeanor and, upon conviction thereof,
    |
0017|     shall be sentenced pursuant to the provisions of Section 31-19-1
    |
0018|     NMSA 1978.
    |
0019|            C.  A manufacturer or distributor who is not licensed
    |
0020|     pursuant to the Charity Games Act and who sells or attempts to
    |
0021|     sell equipment, devices or supplies to a qualified organization
    |
0022|     is guilty of a third degree felony and shall be sentenced
    |
0023|     pursuant to the provisions of Section 31-18-15 NMSA 1978.
    |
0024|       Section 46.  [<u>NEW MATERIAL</u>]  FUND CREATED.--There is
    |
0025|     created in the state treasury the "charity games fund".  All
    |
0001|     fees and the net receipts of the charity games tax paid pursuant
    |
0002|     to the Charity Games Act or regulations adopted pursuant to that
    |
0003|     act shall be credited to the fund.  All money in the fund and
    |
0004|     all interest attributable to it is appropriated to the
    |
0005|     department for the purpose of carrying out the provisions of the
    |
0006|     Charity Games Act.  Money remaining in the fund at the end of
    |
0007|     each fiscal year shall revert to the general fund.
    |
0008|       Section 47.  [<u>NEW MATERIAL</u>]  RECREATIONAL BINGO EXEMPTED
    |
0009|     FROM ACT.--
    |
0010|            A.  Nothing in the Charity Games Act prohibits a
    |
0011|     senior citizen group from conducting bingo at a senior citizen
    |
0012|     center if no person other than a player participating in the
    |
0013|     bingo game receives or becomes entitled to receive a part of the
    |
0014|     proceeds from the game and if no minor is permitted to
    |
0015|     participate in the conduct of the game or play the game.
    |
0016|            B.  As used in this section, "senior citizen group"
    |
0017|     means an organization in which the majority of the membership
    |
0018|     consists of individuals who are fifty-five years of age or older
    |
0019|     and that has as its primary purpose and activity the provision
    |
0020|     of recreational or social activities for those individuals.
    |
0021|       Section 48.  Section 6-24-5 NMSA 1978 (being Laws 1995,
    |
0022|     Chapter 155, Section 5) is amended to read:
    |
0023|       "6-24-5.  NEW MEXICO LOTTERY AUTHORITY CREATED--<u>BOARD OF
</u>    |
<u></u>0024| <u>    DIRECTORS</u>.--
    |
0025|            A.  There is created a public body, politic and
    |
0001|     corporate, separate and apart from the state, constituting a
    |
0002|     governmental instrumentality to be known as the "New Mexico
    |
0003|     lottery authority".  The authority is created and organized for
    |
0004|     the purpose of establishing and conducting the <s>[New Mexico
</s>    |
<s></s>0005| <s>    state]</s> lottery to provide revenues for the public purposes
    |
0006|     designated by the New Mexico Lottery Act.
    |
0007|            B.  The authority shall be governed by a board of
    |
0008|     directors composed of seven members who are residents of New
    |
0009|     Mexico appointed by the governor with the advice and consent of
    |
0010|     the senate.  The members of the board of directors shall be
    |
0011|     prominent persons in their businesses or professions and shall
    |
0012|     be appointed so as to provide equitable geographical
    |
0013|     representation.  No more than four members of the board shall be
    |
0014|     from any one political party.  The governor shall consider
    |
0015|     appointing at least one member who has at least five years <u>of</u>
    |
0016|     experience as a law enforcement officer, at least one member who
    |
0017|     is an attorney admitted to practice in New Mexico and at least
    |
0018|     one member who is a certified public accountant certified in New
    |
0019|     Mexico.
    |
0020|            C.  Board members shall be appointed for five-year
    |
0021|     terms.  To provide for staggered terms, four of the initially
    |
0022|     appointed members shall be appointed for terms of five years and
    |
0023|     three members for terms of three years.  Thereafter, all members
    |
0024|     shall be appointed for five-year terms.  A vacancy shall be
    |
0025|     filled by appointment by the governor for the remainder of the
    |
0001|     unexpired term.  A member shall serve until his replacement is
    |
0002|     confirmed by the senate.  Board members shall be eligible for
    |
0003|     reappointment.
    |
0004|            D.  The board shall select one of its members as
    |
0005|     chairman annually.  A chairman may be selected for successive
    |
0006|     years.  Members of the board may be removed by the governor for
    |
0007|     malfeasance, misfeasance or willful neglect of duty after
    |
0008|     reasonable notice and a public hearing unless the notice and
    |
0009|     hearing are expressly waived in writing by the member.
    |
0010|            E.  The board shall hold regular meetings at the call
    |
0011|     of the chairman, but not less often than once each calendar
    |
0012|     quarter.  A board meeting may also be called upon the request in
    |
0013|     writing of three or more board members.  A majority of members
    |
0014|     then in office constitutes a quorum for the transaction of any
    |
0015|     business and for the exercise of any power or function of the
    |
0016|     authority.
    |
0017|            F.  Board members shall receive no compensation for
    |
0018|     their services, but shall be paid expenses incurred in the
    |
0019|     conduct of authority business as allowed and approved by the
    |
0020|     authority in accordance with policies adopted by the board.
    |
0021|            G.  A board member shall be subject to a background
    |
0022|     check and investigation to determine his fitness for office. 
    |
0023|     The results of that background check shall be made available to
    |
0024|     the governor and the senate.
    |
0025|            <u>H.  Neither the members of the board of directors
</u>    |
<u></u>0001| <u>    nor any person acting on behalf of the board, while acting
</u>    |
<u></u>0002| <u>    within the scope of their authority, shall be subject to any
</u>    |
<u></u>0003| <u>    personal liability for any action taken or omitted within that
</u>    |
<u></u>0004| <u>    scope of authority</u>."
    |
0005|       Section 49.  Section 6-24-6 NMSA 1978 (being Laws 1995,
    |
0006|     Chapter 155, Section 6) is amended to read:
    |
0007|       "6-24-6.  POWERS OF THE AUTHORITY.--
    |
0008|            A.  The authority shall have any and all powers
    |
0009|     necessary or convenient to carry out and effectuate the purposes
    |
0010|     and provisions of the New Mexico Lottery Act that are not in
    |
0011|     conflict with the constitution of New Mexico and that are
    |
0012|     generally exercised by corporations engaged in entrepreneurial
    |
0013|     pursuits, including but without limiting the generality of the
    |
0014|     foregoing the power to:
    |
0015|                 (1)  sue and be sued;
    |
0016|                 (2)  adopt and alter a seal;
    |
0017|                 (3)  adopt, amend and repeal bylaws, rules,
    |
0018|     policies and procedures for the conduct of its affairs and its
    |
0019|     business; 
    |
0020|                 (4)  procure or provide insurance;
    |
0021|                 (5)  hold copyrights, trademarks and service
    |
0022|     marks and enforce its rights with respect thereto;
    |
0023|                 (6)  initiate, supervise and administer the
    |
0024|     operation of the lottery in accordance with the provisions of
    |
0025|     the New Mexico Lottery Act and rules, policies and procedures
    |
0001|     adopted pursuant to that act;
    |
0002|                 (7)  enter into written agreements with one or
    |
0003|     more other states for the operation, participation in or
    |
0004|     marketing or promotion of a joint lottery or joint lottery
    |
0005|     games;
    |
0006|                 (8)  acquire or lease real property and make
    |
0007|     improvements thereon and acquire by lease or by purchase
    |
0008|     personal property, including but not limited to computers,
    |
0009|     mechanical, electronic and on-line equipment and terminals and
    |
0010|     intangible property, including but not limited to computer
    |
0011|     programs, systems and software;
    |
0012|                 (9)  enter into contracts to incur debt and
    |
0013|     borrow money in its own name and enter into financing agreements
    |
0014|     with the state, <u>with</u> agencies or instrumentalities of the
    |
0015|     state or with any commercial bank or credit provider;
    |
0016|                 (10)  receive and expend, in accordance with the
    |
0017|     provisions of the New Mexico Lottery Act, all money received
    |
0018|     from any lottery or nonlottery source for effectuating the
    |
0019|     purposes of the New Mexico Lottery Act;
    |
0020|                 (11)  administer oaths, take depositions, issue
    |
0021|     subpoenas and compel the attendance of witnesses and the
    |
0022|     production of books, papers, documents and other evidence
    |
0023|     relative to any investigation or proceeding conducted by the
    |
0024|     authority; 
    |
0025|                 (12)  appoint and prescribe the duties of
    |
0001|     officers, agents and employees of the authority, including
    |
0002|     professional and administrative staff and personnel, and to fix
    |
0003|     their compensation, pay their expenses and provide a benefit
    |
0004|     program, including but not limited to a retirement plan and a
    |
0005|     group insurance plan;
    |
0006|                 (13)  select and contract with lottery vendors
    |
0007|     and lottery retailers;
    |
0008|                 (14)  enter into contracts or agreements with
    |
0009|     state, local or federal law enforcement agencies or private
    |
0010|     investigators or other persons for the performance of law
    |
0011|     enforcement, background investigations and security checks;
    |
0012|                 <u>(15)  enter into agreements with the
</u>    |
<u></u>0013| <u>    superintendent of regulation and licensing and the department of
</u>    |
<u></u>0014| <u>    public safety to monitor, enable and disable video gambling
</u>    |
<u></u>0015| <u>    machines and slot machines, perform electronic funds transfers
</u>    |
<u></u>0016| <u>    and other services relating to the operation and administration
</u>    |
<u></u>0017| <u>    of video gambling machines and slot machines.  Net income
</u>    |
<u></u>0018| <u>    received by the authority for performing such agreements shall
</u>    |
<u></u>0019| <u>    be included in net revenue of the lottery to be distributed as
</u>    |
<u></u>0020| <u>    provided in the New Mexico Lottery Act. Compensation shall not
</u>    |
<u></u>0021| <u>    exceed actual costs incurred by the lottery authority in
</u>    |
<u></u>0022| <u>    performing the services plus two percent of the difference
</u>    |
<u></u>0023| <u>    between gross receipts from the conduct of machine gambling and
</u>    |
<u></u>0024| <u>    winnings paid by each licensee</u>; 
    |
0025|                 <s>[(15)]</s> <u>(16)</u>  enter into contracts of any and
    |
0001|     all types on such terms and conditions as the authority may
    |
0002|     determine;
    |
0003|                 <s>[(16)]</s> <u>(17)</u>  establish and maintain banking
    |
0004|     relationships, including but not limited to establishment of
    |
0005|     checking and savings accounts and lines of credit;
    |
0006|                 <s>[(17)]</s> <u>(18)</u>  advertise and promote the
    |
0007|     lottery and lottery games;
    |
0008|                 <s>[(18)]</s> <u>(19)</u>  act as a lottery retailer,
    |
0009|     conduct promotions that involve the dispensing of lottery
    |
0010|     tickets and establish and operate a sales facility to sell
    |
0011|     lottery tickets and any related merchandise; and
    |
0012|                 <s>[(19)]</s> <u>(20)</u>  adopt, repeal and amend such
    |
0013|     rules, policies and procedures as necessary to carry out and
    |
0014|     implement its powers and duties, organize and operate the
    |
0015|     authority, conduct lottery games and any other matters necessary
    |
0016|     or desirable for the efficient and effective operation of the
    |
0017|     lottery and the convenience of the public.
    |
0018|            B.  The powers enumerated in this section are
    |
0019|     cumulative of and in addition to those powers enumerated
    |
0020|     elsewhere in the New Mexico Lottery Act, and no such powers
    |
0021|     limit or restrict any other powers of the authority."
    |
0022|       Section 50.  Section 6-24-17 NMSA 1978 (being Laws 1995,
    |
0023|     Chapter 155, Section 17, as amended) is amended to read:
    |
0024|       "6-24-17.  DISCLOSURE OF ODDS.--The authority shall make
    |
0025|     adequate disclosure of the odds with respect to each lottery
    |
0001|     game by stating the odds in lottery game advertisements, <u>on
</u>    |
<u></u>0002| <u>    lottery tickets</u> or by posting the odds at each place in which
    |
0003|     lottery tickets are sold."
    |
0004|       Section 51.  Section 6-24-26 NMSA 1978 (being Laws 1995,
    |
0005|     Chapter 155, Section 26) is amended to read:
    |
0006|       "6-24-26.  AUTHORIZATION TO ISSUE REVENUE BONDS.--
    |
0007|            A.  In order to provide funds for the initial
    |
0008|     development and operation of the lottery, the board is
    |
0009|     authorized to issue lottery revenue bonds in an amount not to
    |
0010|     exceed <s>[three million dollars ($3,000,000)]</s> <u>six million
</u>    |
<u></u>0011| <u>    dollars ($6,000,000)</u> payable solely from revenues of the
    |
0012|     authority generated from operation of the lottery.
    |
0013|            B.  The board may issue bonds to refund other bonds
    |
0014|     issued pursuant to this section.
    |
0015|            C.  The bonds shall have a maturity of no more than
    |
0016|     five years from the date of issuance.  The board shall determine
    |
0017|     all other terms, covenants and conditions of the bonds;
    |
0018|     provided, however, that the bonds may provide for prepayment in
    |
0019|     part or in full of the balance due at any time without penalty.
    |
0020|            D.  The bonds shall be executed with the manual or
    |
0021|     facsimile signature of the chief executive officer or the
    |
0022|     chairman of the board and attested <u>to</u> by another member of the
    |
0023|     board.  The bonds may bear the seal, if any, of the authority.
    |
0024|            E.  The proceeds of the bonds and the earnings on
    |
0025|     those proceeds are appropriated to the authority for the initial
    |
0001|     development and operation of the lottery, to pay expenses
    |
0002|     incurred in the preparation, issuance and sale of the bonds, to
    |
0003|     pay any obligations relating to the bonds and the proceeds of
    |
0004|     the bonds under the Internal Revenue Code of 1986 and for any
    |
0005|     other lawful purpose.
    |
0006|            F.  The bonds may be sold either at a public sale or
    |
0007|     at a private sale to the state investment officer or to the
    |
0008|     state treasurer.  If the bonds are sold at a public sale, the
    |
0009|     notice of sale and other procedures for the sale shall be
    |
0010|     determined by the chief executive officer or the board.
    |
0011|            G.  This section is full authority for the issuance
    |
0012|     and sale of the bonds, and the bonds shall not be invalid for
    |
0013|     any irregularity or defect in the proceedings for their issuance
    |
0014|     and sale and shall be incontestable in the hands of bona fide
    |
0015|     purchasers or holders of the bonds for value.
    |
0016|            H.  An amount of money from the sources specified in
    |
0017|     Subsection A of this section sufficient to pay the principal of
    |
0018|     and interest on the bonds as they become due in each year shall
    |
0019|     be set aside, and is hereby pledged, for the payment of the
    |
0020|     principal and interest on the bonds.
    |
0021|            I.  The bonds shall be legal investments for any
    |
0022|     person or board charged with the investment of public funds and
    |
0023|     may be accepted as security for any deposit of public money, and
    |
0024|     the bonds and interest thereon are exempt from taxation by the
    |
0025|     state and any political subdivision or agency of the state.
    |
0001|            J.  The bonds shall be payable by the authority,
    |
0002|     which shall keep a complete record relating to the payment of
    |
0003|     the bonds."
    |
0004|       Section 52.  Section 7-1-2 NMSA 1978 (being Laws 1965,
    |
0005|     Chapter 248, Section 2, as amended) is amended to read:
    |
0006|       "7-1-2.  APPLICABILITY.--The Tax Administration Act applies
    |
0007|     to and governs:
    |
0008|            A.  the administration and enforcement of the
    |
0009|     following taxes or tax acts as they now exist or may hereafter
    |
0010|     be amended:
    |
0011|                 (1)  Income Tax Act;
    |
0012|                 (2)  Withholding Tax Act;
    |
0013|                 (3)  Gross Receipts and Compensating Tax Act and
    |
0014|     any state gross receipts tax;
    |
0015|                 (4)  Liquor Excise Tax Act;
    |
0016|                 (5)  Local Liquor Excise Tax Act;
    |
0017|                 <s>[(6)  Banking and Financial Corporations Tax
</s>    |
<s></s>0018| <s>    Act;
</s>    |
<s></s>0019| <s>                (7)]</s> <u>(6)</u>  any municipal local option gross
    |
0020|     receipts tax;
    |
0021|                 <s>[(8)]</s> <u>(7)</u>  any county local option gross
    |
0022|     receipts tax;
    |
0023|                 <s>[(9)]</s> <u>(8)</u>  Special Fuels Supplier Tax Act;
    |
0024|                 <s>[(10)]</s> <u>(9)</u>  Gasoline Tax Act;
    |
0025|                 <s>[(11)]</s> <u>(10)</u>  petroleum products loading fee,
    |
0001|     which fee shall be considered a tax for the purpose of the Tax
    |
0002|     Administration Act;
    |
0003|                 <s>[(12)]</s> <u>(11)</u>  Cigarette Tax Act;
    |
0004|                 <s>[(13)]</s> <u>(12)</u>  Estate Tax Act;
    |
0005|                 <s>[(14)]</s> <u>(13)</u>  Railroad Car Company Tax Act;
    |
0006|                 <s>[(15)]</s> <u>(14)</u>  Investment Credit Act;
    |
0007|                 <s>[(16)]</s> <u>(15)</u>  Corporate Income Tax Act;
    |
0008|                 <s>[(17)]</s> <u>(16)</u>  Corporate Income and Franchise
    |
0009|     Tax Act;
    |
0010|                 <s>[(18)]</s> <u>(17)</u>  Uniform Division of Income for
    |
0011|     Tax Purposes Act;
    |
0012|                 <s>[(19)]</s> <u>(18)</u>  Multistate Tax Compact; 
    |
0013|                 <s>[(20)]</s> <u>(19)</u>  Tobacco Products Tax Act;
    |
0014|                 <s>[(21)]</s> <u>(20)</u>  Filmmaker's Credit Act; and
    |
0015|                 <s>[(22)]</s> <u>(21)</u>  the telecommunications relay
    |
0016|     service surcharge imposed by Section 63-9F-11 NMSA 1978, which
    |
0017|     surcharge shall be considered a tax for the purposes of the Tax
    |
0018|     Administration Act;
    |
0019|            B.  the administration and enforcement of the
    |
0020|     following taxes, surtaxes, advanced payments or tax acts as they
    |
0021|     now exist or may hereafter be amended:
    |
0022|                 (1)  Resources Excise Tax Act;
    |
0023|                 (2)  Severance Tax Act;
    |
0024|                 (3)  any severance surtax;
    |
0025|                 (4)  Oil and Gas Severance Tax Act;
    |
0001|                 (5)  Oil and Gas Conservation Tax Act;
    |
0002|                 (6)  Oil and Gas Emergency School Tax Act;
    |
0003|                 (7)  Oil and Gas Ad Valorem Production Tax Act;
    |
0004|                 (8)  Natural Gas Processors Tax Act;
    |
0005|                 (9)  Oil and Gas Production Equipment Ad Valorem
    |
0006|     Tax Act; 
    |
0007|                 (10)  Copper Production Ad Valorem Tax Act; and
    |
0008|                 (11)  any advance payment required to be made by
    |
0009|     any act specified in this subsection, which advance payment
    |
0010|     shall be considered a tax for the purposes of the Tax
    |
0011|     Administration Act;
    |
0012|            C.  the administration and enforcement of the
    |
0013|     following taxes, surcharges, fees or acts as they now exist or
    |
0014|     may hereafter be amended:
    |
0015|                 (1)  Weight Distance Tax Act;
    |
0016|                 (2)  Special Fuels Tax Act;
    |
0017|                 (3)  the workers' compensation fee authorized by
    |
0018|     Section 52-5-19 NMSA 1978, which fee shall be considered a tax
    |
0019|     for purposes of the Tax Administration Act;
    |
0020|                 (4)  Controlled Substance Tax Act;
    |
0021|                 (5)  Uniform Unclaimed Property Act;
    |
0022|                 (6)  911 emergency surcharge and the network and
    |
0023|     database surcharge, which surcharges shall be considered taxes
    |
0024|     for purposes of the Tax Administration Act;
    |
0025|                 (7)  the solid waste assessment fee authorized
    |
0001|     by the Solid Waste Act, which fee shall be considered a tax for
    |
0002|     purposes of the Tax Administration Act; <s>[and]</s>
    |
0003|                 (8)  the water conservation fee imposed by
    |
0004|     Section 74-1-13 NMSA 1978, which fee shall be considered a tax
    |
0005|     for the purposes of the Tax Administration Act; <s>[and]</s>
    |
0006|                 <u>(9)  the machine gambling tax imposed pursuant
</u>    |
<u></u>0007| <u>    to the Video Gambling Act; and</u>
    |
0008|                 <u>(10)  the charity games tax imposed pursuant to
</u>    |
<u></u>0009| <u>    the Charity Games Act; and</u>
    |
0010|            D.  the administration and enforcement of all other
    |
0011|     laws, with respect to which the department is charged with
    |
0012|     responsibilities pursuant to the Tax Administration Act, but
    |
0013|     only to the extent that such other laws do not conflict with the
    |
0014|     Tax Administration Act."
    |
0015|       Section 53.  A new section of the Tax Administration Act is
    |
0016|     enacted to read:
    |
0017|       "[<u>NEW MATERIAL</u>]  DISTRIBUTION OF CHARITY GAMES TAX.--A
    |
0018|     distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made
    |
0019|     to the charity games fund of the net receipts attributable to
    |
0020|     the charity games tax."
    |
0021|       Section 54.  A new section of the Tax Administration Act is
    |
0022|     enacted to read:
    |
0023|       "[<u>NEW MATERIAL</u>]  DISTRIBUTION OF MACHINE GAMBLING TAX.--A
    |
0024|     distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made
    |
0025|     to the machine gambling fund of the net receipts attributable to
    |
0001|     the machine gambling tax."
    |
0002|       Section 55.  Section 7-27-5.21 NMSA 1978 (being Laws 1995,
    |
0003|     Chapter 155, Section 36) is amended to read:
    |
0004|       "7-27-5.21.  NEW MEXICO LOTTERY REVENUE BONDS.--The
    |
0005|     severance tax permanent fund may be invested in revenue bonds
    |
0006|     issued by the New Mexico lottery authority pursuant to the
    |
0007|     provisions of the New Mexico Lottery Act.  The amount invested
    |
0008|     shall not exceed <s>[three million dollars ($3,000,000)]</s> <u>six
</u>    |
<u></u>0009| <u>    million dollars ($6,000,000)</u>."
    |
0010|       Section 56.  Section 30-19-1 NMSA 1978 (being Laws 1963,
    |
0011|     Chapter 303, Section 19-1, as amended) is amended to read:
    |
0012|       "30-19-1.  DEFINITIONS RELATING TO GAMBLING.--As used in
    |
0013|     Chapter 30, Article 19 NMSA 1978:
    |
0014|            A.  "antique gambling device" means a gambling device
    |
0015|     twenty-five years of age or older and substantially in original
    |
0016|     condition that is not used for gambling or commercial gambling
    |
0017|     or located in a gambling place; 
    |
0018|            B.  "bet" means a bargain in which the parties agree
    |
0019|     that, dependent upon chance, even though accompanied by some
    |
0020|     skill, one stands to win or lose anything of value specified in
    |
0021|     the agreement.  A bet does not include:
    |
0022|                 (1)  bona fide business transactions that are
    |
0023|     valid under the law of contracts, including without limitation:
    |
0024|                      (a)  contracts for the purchase or sale,
    |
0025|     at a future date, of securities or other commodities; and
    |
0001|                      (b)  agreements to compensate for loss
    |
0002|     caused by the happening of the chance, including without
    |
0003|     limitation contracts for indemnity or guaranty and life or
    |
0004|     health and accident insurance;
    |
0005|                 (2)  offers of purses, prizes or premiums to the
    |
0006|     actual contestants in any bona fide contest for the
    |
0007|     determination of skill, speed, strength or endurance or to the
    |
0008|     bona fide owners of animals or vehicles entered in such contest;
    |
0009|                 (3)  a lottery as defined in this section; or
    |
0010|                 (4)  betting otherwise permitted by law;
    |
0011|            <s>[C.  "lottery" means an enterprise other than the
</s>    |
<s></s>0012| <s>    New Mexico state lottery established and operated pursuant to
</s>    |
<s></s>0013| <s>    the New Mexico Lottery Act wherein, for a consideration, the
</s>    |
<s></s>0014| <s>    participants are given an opportunity to win a prize, the award
</s>    |
<s></s>0015| <s>    of which is determined by chance, even though accompanied by
</s>    |
<s></s>0016| <s>    some skill.  As used in this subsection, "consideration" means
</s>    |
<s></s>0017| <s>    anything of pecuniary value required to be paid to the promoter
</s>    |
<s></s>0018| <s>    in order to participate in such enterprise;
</s>    |
<s></s>0019| <s>           D.]</s> <u>C.</u>  "gambling device" means a contrivance
    |
0020|     other than an antique gambling device that, for a consideration,
    |
0021|     affords the player an opportunity to obtain anything of value,
    |
0022|     the award of which is determined by chance, even though
    |
0023|     accompanied by some skill and whether or not the prize is
    |
0024|     automatically paid by the device; <s>[and
</s>    |
<s></s>0025| <s>           E.]</s> <u>D.</u>  "gambling place" means any building or
    |
0001|     tent, any vehicle, whether self-propelled or not, or any room
    |
0002|     within any of them, one of whose principal uses is:
    |
0003|                 (1)  making and settling of bets;
    |
0004|                 (2)  receiving, holding, recording or forwarding
    |
0005|     bets or offers to bet;
    |
0006|                 (3)  conducting lotteries; or
    |
0007|                 (4)  playing gambling devices;
    |
0008|       <u>    E.  "lottery" means an enterprise other than the New
</u>    |
<u></u>0009| <u>    Mexico state lottery established and operated pursuant to the
</u>    |
<u></u>0010| <u>    New Mexico Lottery Act wherein, for a consideration, the
</u>    |
<u></u>0011| <u>    participants are given an opportunity to win a prize, the award
</u>    |
<u></u>0012| <u>    of which is determined by chance, even though accompanied by
</u>    |
<u></u>0013| <u>    some skill.  As used in this subsection, "consideration" means
</u>    |
<u></u>0014| <u>    anything of pecuniary value required to be paid to the promoter
</u>    |
<u></u>0015| <u>    in order to participate in the enterprise;
</u>    |
<u></u>0016| <u>           F.  "raffle" means a game in which the prize is won
</u>    |
<u></u>0017| <u>    by random drawing of the name or number of one or more persons
</u>    |
<u></u>0018| <u>    purchasing a chance; and
</u>    |
<u></u>0019| <u>           G.  "video gambling" means any form of gambling in
</u>    |
<u></u>0020| <u>    which, upon payment of a consideration, an electronic device may
</u>    |
<u></u>0021| <u>    be played that simulates the play of a game of chance, utilizes
</u>    |
<u></u>0022| <u>    a video display and microprocessors and that by chance, or
</u>    |
<u></u>0023| <u>    through some combination of chance and skill, a player may
</u>    |
<u></u>0024| <u>    receive or the device may dispense to the player cash, coins or
</u>    |
<u></u>0025| <u>    tokens or free games or credits that may be redeemed for cash,
</u>    |
<u></u>0001| <u>    coins or tokens</u>."
    |
0002|       Section 57.  Section 30-19-6 NMSA 1978 (being Laws 1963,
    |
0003|     Chapter 303, Section 19-6, as amended) is amended to read:
    |
0004|       "30-19-6.  <s>[PERMISSIVE LOTTERY]</s> <u>AUTHORIZED GAMBLING--FAIRS, THEATERS AND TAX-EXEMPT ORGANIZATIONS--VIDEO GAMBLING ACT
</u>    |
<u></u>0005| <u>    AND CHARITY GAMES ACT ACTIVITIES</u>.--
    |
0006|            A.  Nothing in <s>[Article 19]</s> Chapter 30, <u>Article
</u>    |
<u></u>0007| <u>    19</u> NMSA 1978 <s>[shall be construed to apply to any]</s> <u>prohibits
</u>    |
<u></u>0008| <u>    a</u> sale or drawing of <s>[any]</s> <u>a</u> prize at <s>[any]</s> <u>a</u> fair held
    |
0009|     in this state for the benefit of <s>[any]</s> <u>a</u> church, public
    |
0010|     library or religious society <s>[situate or being]</s> <u>located</u> in
    |
0011|     this state or for charitable purposes when all the proceeds of
    |
0012|     <s>[such]</s> <u>the</u> fair <s>[shall be]</s> <u>are</u> expended in this state
    |
0013|     for the benefit of <s>[such]</s> <u>a</u> church, public library,
    |
0014|     religious society or charitable purposes.  A <s>[lottery shall be
</s>    |
<s></s>0015| <s>    operated]</s> <u>sale or drawing conducted pursuant to this
</u>    |
<u></u>0016| <u>    subsection is</u> for the benefit of the organization or charitable
    |
0017|     purpose only <s>[when]</s> <u>if</u> the entire proceeds <s>[of]</s> <u>from</u> the
    |
0018|     <s>[lottery]</s> <u>sale or drawing</u> go to the organization or
    |
0019|     charitable purpose and no part of <s>[such]</s> <u>the</u> proceeds go to
    |
0020|     any individual member or employee <s>[thereof]</s> <u>of the
</u>    |
<u></u>0021| <u>    organization</u>.
    |
0022|            B.  Nothing in <s>[Article 19]</s> Chapter 30, <u>Article
</u>    |
<u></u>0023| <u>    19</u> NMSA 1978 <s>[shall be held to prohibit any]</s> <u>prohibits a</u>
    |
0024|     bona fide motion picture <s>[theatre]</s> <u>theater</u> from offering
    |
0025|     prizes of cash or merchandise for advertising purposes in
    |
0001|     connection with <s>[such]</s> <u>the</u> business <u>of the theater</u> or for
    |
0002|     the purpose of stimulating business, whether or not <s>[any]</s>
    |
0003|     consideration other than a monetary consideration in excess of
    |
0004|     the regular price of admission is <s>[exacted]</s> <u>charged</u> for
    |
0005|     participation in drawings for prizes.
    |
0006|            C.  Nothing in <s>[Article 19]</s> Chapter 30, <u>Article
</u>    |
<u></u>0007| <u>    19</u> NMSA 1978 <s>[shall be held to apply to any]</s> <u>prohibits a</u>
    |
0008|     bona fide county fair, including <s>[fairs]</s> <u>a fair</u> for more
    |
0009|     than one county, <s>[which shall have]</s> <u>that has</u> been held
    |
0010|     annually at the same location for at least two years <s>[and which
</s>    |
<s></s>0011| <s>    shall offer]</s> <u>from offering</u> prizes of livestock or poultry in
    |
0012|     connection with <s>[such]</s> <u>the</u> fair <s>[when]</s> <u>if</u> the proceeds
    |
0013|     of <s>[such]</s> <u>the</u> drawings <s>[shall be]</s> <u>are</u> used for the
    |
0014|     benefit of <s>[said]</s> <u>the</u> fair.
    |
0015|            <s>[D.  Nothing in Article 19, Chapter 30 NMSA 1978
</s>    |
<s></s>0016| <s>    shall be construed to apply to any lottery operated by an
</s>    |
<s></s>0017| <s>    organization exempt from the state income tax pursuant to
</s>    |
<s></s>0018| <s>    Subsection C of Section 7-2-4 NMSA 1978 and not subject to the
</s>    |
<s></s>0019| <s>    provisions of Subsection A of this section; provided that:
</s>    |
<s></s>0020| <s>                (1)  no more than two lotteries shall be
</s>    |
<s></s>0021| <s>    operated in any year by such an organization;
</s>    |
<s></s>0022| <s>                (2)  all the gross proceeds less the reasonable
</s>    |
<s></s>0023| <s>    cost of prizes of any lottery operated by such an organization
</s>    |
<s></s>0024| <s>    shall be expended in the state for the benefit of the
</s>    |
<s></s>0025| <s>    organization or public purposes; and
</s>    |
<s></s>0001| <s>                (3)  no part of the proceeds of any lottery
</s>    |
<s></s>0002| <s>    shall go to any individual member or employee of any
</s>    |
<s></s>0003| <s>    organization except as payment for the purchase of prizes at no
</s>    |
<s></s>0004| <s>    more than the reasonable retail price]</s>
    |
0005|            <u>D.  Nothing in Chapter 30, Article 19 NMSA 1978
</u>    |
<u></u>0006| <u>    prohibits an organization that is exempt from state income tax
</u>    |
<u></u>0007| <u>    pursuant to Section 7-2-4 NMSA 1978 from conducting bingo games,
</u>    |
<u></u>0008| <u>    raffles, lotteries or table games, including poker, craps,
</u>    |
<u></u>0009| <u>    blackjack, roulette and the like, at a fundraising event if:
</u>    |
<u></u>0010| <u>                (1)  the fundraising events are conducted no
</u>    |
<u></u>0011| <u>    more than twice in a calendar year by the qualifying
</u>    |
<u></u>0012| <u>    organization;
</u>    |
<u></u>0013| <u>                (2)  the only persons authorized to participate
</u>    |
<u></u>0014| <u>    in the operation or management of the fundraising event are:
</u>    |
<u></u>0015| <u>                     (a)  bona fide members of the qualifying
</u>    |
<u></u>0016| <u>    organization who are not paid for their services in the
</u>    |
<u></u>0017| <u>    operation or management of the event; or
</u>    |
<u></u>0018| <u>                     (b)  persons who provide goods or services
</u>    |
<u></u>0019| <u>    for the fundraising event for a flat fee or an hourly fee
</u>    |
<u></u>0020| <u>    pursuant to a written contract with the qualifying organization;
</u>    |
<u></u>0021| <u>                (3)  no person receives any part of the proceeds
</u>    |
<u></u>0022| <u>    of the fundraising event except:
</u>    |
<u></u>0023| <u>                     (a)  as payment for prizes purchased at no
</u>    |
<u></u>0024| <u>    more than the reasonable retail prices for the prizes; or 
</u>    |
<u></u>0025| <u>                     (b)  pursuant to a contract described in
</u>    |
<u></u>0001| <u>    Subparagraph (b) of Paragraph (2) of this subsection;
</u>    |
<u></u>0002| <u>                (4)  the net proceeds of the fundraising event
</u>    |
<u></u>0003| <u>    are expended in the state for the benefit of the qualifying
</u>    |
<u></u>0004| <u>    organization or purposes for which it was formed;
</u>    |
<u></u>0005| <u>                (5)  gross revenue, expenses, prizes paid and
</u>    |
<u></u>0006| <u>    the date, time and location of the fundraising event are
</u>    |
<u></u>0007| <u>    reported to the alcohol and gaming division of the regulation
</u>    |
<u></u>0008| <u>    and licensing department within thirty days after the event;
</u>    |
<u></u>0009| <u>                (6)  the qualifying organization conducting the
</u>    |
<u></u>0010| <u>    fundraising event maintains records for a period of one year
</u>    |
<u></u>0011| <u>    after the date of the event that accurately show the gross
</u>    |
<u></u>0012| <u>    revenue generated by the event, details of the expenses of
</u>    |
<u></u>0013| <u>    conducting the event and details of how the gross revenue is
</u>    |
<u></u>0014| <u>    used, and the qualifying organization makes the records
</u>    |
<u></u>0015| <u>    available for review by the director of the alcohol and gaming
</u>    |
<u></u>0016| <u>    division of the regulation and licensing department or the
</u>    |
<u></u>0017| <u>    attorney general, or both, at their request;
</u>    |
<u></u>0018| <u>                (7)  no video gambling is conducted and no slot
</u>    |
<u></u>0019| <u>    machines are operated during the fundraising event;
</u>    |
<u></u>0020| <u>                (8)  no persons less than the age of twenty-one
</u>    |
<u></u>0021| <u>    are allowed to participate in the operation or management of the
</u>    |
<u></u>0022| <u>    fundraising event or to play any game at the event; and
</u>    |
<u></u>0023| <u>                (9)  the fundraising event is conducted pursuant
</u>    |
<u></u>0024| <u>    to a permit issued by the alcohol and gaming division of the
</u>    |
<u></u>0025| <u>    regulation and licensing department</u>.
    |
0001|            <u>E.  Nothing in Chapter 30, Article 19 NMSA 1978
</u>    |
<u></u>0002| <u>    prohibits activities authorized and the games of chance
</u>    |
<u></u>0003| <u>    permitted and regulated pursuant to the provisions of the Video
</u>    |
<u></u>0004| <u>    Gambling Act and the Charity Games Act</u>."
    |
0005|       Section 58.  A new Section 30-19-6.1 NMSA 1978 is enacted
    |
0006|     to read: 
    |
0007|       "30-19-6.1.  [<u>NEW MATERIAL</u>]  PERMITTED GAMBLING--RECREATIONAL BINGO.--
    |
0008|            A.  Nothing in Chapter 30, Article 19 NMSA 1978
    |
0009|     prohibits a senior citizen group from conducting bingo at a
    |
0010|     senior citizen center if no person other than a player
    |
0011|     participating in the bingo game receives or becomes entitled to
    |
0012|     receive a part of the proceeds from the game and if no minor is
    |
0013|     permitted to participate in the conduct of the game or play the
    |
0014|     game.   
    |
0015|            B.  As used in this section, "senior citizen group"
    |
0016|     means an organization in which the majority of the membership
    |
0017|     consists of individuals who are fifty-five years of age or older
    |
0018|     and that has as its primary purpose and activity the provision
    |
0019|     of recreational or social activities for those individuals."
    |
0020|       Section 59.  Section 60-7A-19 NMSA 1978 (being Laws 1981,
    |
0021|     Chapter 39, Section 96) is amended to read:
    |
0022|       "60-7A-19.  COMMERCIAL GAMBLING ON LICENSED PREMISES.--
    |
0023|            A.  It is a violation of the Liquor Control Act for a
    |
0024|     licensee to knowingly allow commercial gambling on the licensed
    |
0025|     premises.
    |
0001|            B.  In addition to any criminal penalties, any person
    |
0002|     who violates Subsection A of this section may have his license
    |
0003|     suspended or revoked or a fine imposed, or both, pursuant to the
    |
0004|     Liquor Control Act.
    |
0005|            C.  <s>[For purposes of]</s> <u>As used in</u> this section:                    <u>(1)</u>  "commercial gambling" means:
    |
0006|                      <s>[(1)]</s> <u>(a)</u>  participating in the
    |
0007|     earnings of or operating a gambling place;
    |
0008|                      <s>[(2)]</s> <u>(b)</u>  receiving, recording or
    |
0009|     forwarding bets or offers to bet;
    |
0010|                      <s>[(3)]</s> <u>(c)</u>  possessing facilities with
    |
0011|     the intent to receive, record or forward bets or offers to bet;
    |
0012|                      <s>[(4)]</s> <u>(d)</u>  for gain, becoming a
    |
0013|     custodian of anything of value bet or offered to be bet;
    |
0014|                      <s>[(5)]</s> <u>(e)</u>  conducting a lottery where
    |
0015|     both the consideration and the prize are money or whoever with
    |
0016|     intent to conduct a lottery possesses facilities to do so; or
    |
0017|                      <s>[(6)]</s> <u>(f)</u>  setting up for use for the
    |
0018|     purpose of gambling, or collecting the proceeds of, any gambling
    |
0019|     device or game; <u>and</u>
    |
0020|                 <u>(2)  "commercial gambling" does not include:
</u>    |
<u></u>0021| <u>                     (a)  activities authorized pursuant to the
</u>    |
<u></u>0022| <u>    New Mexico Lottery Act;
</u>    |
<u></u>0023| <u>                     (b)  the conduct of games pursuant to
</u>    |
<u></u>0024| <u>    Subsection D of Section 30-19-6 NMSA 1978;</u>
    |
0025|                      <u>(c)  the conduct of machine gambling
</u>    |
<u></u>0001| <u>    authorized pursuant to the Video Gambling Act on the licensed
</u>    |
<u></u>0002| <u>    premises of a club licensee licensed pursuant to Section 60-6A-5
</u>    |
<u></u>0003| <u>    NMSA 1978 or the licensed premises of a racetrack; and
</u>    |
<u></u>0004| <u>    </u>           <u>    (d)  the conduct of activities authorized
</u>    |
<u></u>0005| <u>    or games permitted pursuant to the Charity Games Act on the
</u>    |
<u></u>0006| <u>    licensed premises of a club licensee licensed pursuant to
</u>    |
<u></u>0007| <u>    Section 60-6A-5 NMSA 1978</u>."
    |
0008|       Section 60.  REPEAL.--Sections 60-2B-1 through 60-2B-14
    |
0009|     NMSA 1978 (being Laws 1981, Chapter 259, Sections 1 through 14,
    |
0010|     as amended) are repealed.
    |
0011|       Section 61.  SEVERABILITY.--If any part or application of
    |
0012|     this act is held invalid, the remainder or its application to
    |
0013|     other situations or persons shall not be affected.
    |
0014|       Section 62.  EFFECTIVE DATE.--
    |
0015|            A.  The effective date of the provisions of Sections
    |
0016|     20, 27 through 47 and 60 of this act is January 1, 1997. 
    |
0017|            B.  The effective date of the provisions of Sections
    |
0018|     7 through 19 and 21 through 26 of this act is July 1, 1996.
    |
0019|       Section 63.  EMERGENCY.--It is necessary for the public
    |
0020|     peace, health and safety that this act take effect immediately.  
    |
0021|                              
    |