City and County Regulations

A city or county has the authority to adopt more stringent regulations pertaining to lawful gambling within its jurisdiction under Minnesota Statutes, Section 349.213. Below are guidelines and limitations on authority for investigation fees, local gambling tax (up to 3%), lawful gambling contribution fund (up to 10%), and trade area. A township does not have authority to impose lawful gambling regulations.

1. The city or county may not require an organization to make a contribution to the city or county as a condition to operate within that city or county, except for an investigation fee or a local gambling tax, and contributions to a 10% fund.

2. The city or county may not require a license or fee for a license or permit to conduct gambling for licensed organizations, gambling managers, gambling employees, distributors, or linked bingo game providers. The Minnesota Gambling Control Board is the licensing authority.

3% Lawful Gambling Regulatory (Local) Tax

A city may only impose a lawful gambling regulatory tax, up to 3% per year of gross receipts, if the amount is necessary to cover the costs to regulate gambling in a city's or county's jurisdiction, and overages are returned to the lawful gambling organizations that paid the lawful gambling regulatory tax. Regulating lawful gambling includes site inspections, compliance reviews, corrective action, and trade area monitoring. Regulating lawful gambling does not include providing for past or future calendar year lawful gambling regulation. A city or county may impose a local gambling tax only if it does not charge an investigation fee or other local tax on lawful gambling.

Guide for Cities: How Cities May Spend Annual 3% Lawful Gambling Regulatory Tax      

Form LG500: City or County Annual Report (3% Lawful Gambling Regulatory Tax) is now an Excel worksheet. Please download the Excel version of the form, complete it, and then attach the entire electronic file to your email. (PDFs can no longer be accepted, and files cannot be faxed or mailed to us.) You can download Form LG500 here.

Cities must submit this form to the Minnesota Gambling Control Board by March 15 of each year.

Please note: City documents pertaining to site inspections, compliance reviews, trade area monitoring, fines, penalties, or other corrective action involving local lawful gambling regulation must be provided to the Minnesota Gambling Control Board within 30 days of the inspection, compliance review, corrective action, etc.

View how your local tax dollars are spent

 

10% Lawful Gambling Contribution Fund

As established by ordinance, a city or county may require an organization to contribute up to 10% per year of net profits to a fund that the city or county administers and regulates. Net profits are gross profits less amounts expended for that site's allowable expenses and portion of lawful gambling taxes. The 10% contribution requirement may only be applied to net profits derived from lawful gambling conducted at premises within the city or county’s jurisdiction. A city or county may request from an organization a copy of the site's LG100A showing that site's net profit.  

• Organizations must make 10% fund checks payable to the city requiring the funds, and not to any other payee.
• The funds may only be spent by the city or county for charitable contributions as defined in section 349.12, subdivision 7a. The city must issue checks directly to the vendor. 
• The fund may not be used for the payment of pension obligations or general city functions. 
• A licensed organization that contributes to the 10% fund may not be the beneficiary of that fund.

Guide for Cities: How Cities May Spend 10% Lawful Gambling Contributions

Form LG510: City or County Annual Report (10% Lawful Gambling Contribution Fund) is now an Excel worksheet. Please download the Excel version of the form, complete it, and then attach the entire electronic file to your email. (PDFs can no longer be accepted, and files cannot be faxed or mailed to us.)  You can download Form LG510 here.

Cities must submit this form to the Gambling Control Board by March 15 of each year.

View balances and how your local 10% contribution dollars are spent

 

Investigation Fee

A city or county may assess an investigation fee on organizations applying for or renewing a premises permit issued by the Gambling Control Board. The investigation fee may not exceed the following limits:

1. $500 for cities of the first class; 
2. $250 for cities of the second class; 
3. $100 for all other cities; and 
4. $375 for counties.    

The investigation fee must be used for regulation of lawful gambling in that jurisdiction.

   

Trade Area

By ordinance, a city or county may require that a licensed organization conducting lawful gambling within its jurisdiction spend all or a portion of its lawful purpose expenditures on lawful purposes conducted or located within the city's or county's trade area.    
  

The ordinance is limited to the following:

• lawful purpose expenditures are limited to gross profits derived from lawful gambling conducted at premises within the jurisdiction of the city or county;
• the ordinance must define the city or county trade area. A trade area defined by a city must include each city and township contiguous to the defining city; and
• the ordinance must specify the percentage of lawful purpose expenditures that must be expended within the trade area.

The city or county does not have authority on what specific lawful purpose expenditures must be made. That authority rests with the organization and its membership.