03-23-2005 Council Agenda - Laserfiche WebLink

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that we will have an initial indication by Wednesday's meeting as to the interest level of these organizations, although LCRA does not yet have a board meeting set -up due to scheduling difficulties. The Little Canada Fire Department has already decided not to expand their gambling operation into the Bingo Hall. There may also be other non - profit entities operating within the City for at least three years (City and Gambling Control Board requirement) that could be options as well. Lastly, we have received calls from entities from outside the city expressing interest. However, past City Councils have indicated their disdain for non - community based organizations that would use their profits outside of the Little Canada area. Another issue that needs to be considered is compliance requirements. As you know, the charities at the Bingo Hall have been profitable. However, some have experienced problems staying in compliance (allowable expenses as a percentage of gross revenues less prizes — currently at 55 %). Legislation is pending that may assist in this regard. Two significant changes being considered are further rent restrictions. The Gambling Control Board (GCB) is concerned that rents paid by bingo halls, in many cases, dramatically exceeds typical rents of the market area. To address this, rents may be based upon a maximum percentage of gross profits less expenses. The current proposal is 10% or comparable costs per square foot for leased space as approved the director of the GCB. (I have attached a chart I received from the GCB that reviews current rents and possible limitations and a portion of HE 1802 pages 25 -28.) Another change is raising the percentage of allowable expenses. House File 1801 had initially proposed an increase from 55% to 60% (See page 7 from the bill). However, the Legislature may not agree that this is necessary based on their perception that charities have not done a good job controlling their expenses. Without statutory changes impacting compliance regulations, it is doubtful that the Bingo Hall as we currently know it can survive. The current charities operating at the Bingo Hall have been invited to this meeting to participate in this discussion. Depending on Millennium's decisions involving their consent order, time may be of the essence to ensure continuity of the operation that is essential to maintaining the customer and employee base. Canadian Days and LCRA have also been invited to participate. While the City can impact certain aspects of the Bingo Hall's operation, it will take a partnership of the participants to ensure a successful operation, including the landlords. cc: Millennium Charities Plus Lake Owasso Residence Volunteer Council North Suburban Youth Foundation Little Canada Historical Society Canadian Days Little Canada Recreation Association Little Canada Fire Department Mark Hotzler, Market Place Shopping Center 2