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MAYOR <br />Michael 1. Fahey <br />COUNCIL <br />Jini LaValle <br />Matt Anderson <br />Rid( Montour <br />13111 Blesener <br />515 Little Canada Road, Little Canada, MN 55117 600 ADMINISTRATOR <br />(651) 766 -4029 / FAX: (651) 766 -4048 Joel R. Hanson <br />DecellttIvil jig YO4anada. mn.us <br />Mr. Thomas Barrett, Executive Director <br />Minnesota Gambling Control Board <br />1711 West County Road B, Suite 300 South <br />Roseville, MN 55113 <br />RE: Bingo Hall Expense Compliance Regulations <br />Dear Mr. Barrett: <br />Our City believes the statutory provisions regarding the percentage of lawful expenses associated with the <br />operation of a bingo hall do not reflect today's environment. With increased competition for the gaming <br />dollar, bingo halls have seen their customer base erode. As a result, the expenses necessary to maintain the <br />bingo operation have risen relative to gross profit. In Little Canada's case, this is creating a compliance <br />problem for three of the four charities operating at the Little Canada Bingo Hall. <br />In meeting with our charities over the past few years, we are aware that they have taken many expense <br />reduction measures. They include a reduced work force, minimal or no officer compensation, and reduced <br />prize payouts. In fact, the owner's of the Little Canada Bingo Hall even reduced the monthly rent charged <br />to the charities to help them with the compliance issue. It should be noted that the rent they were paying <br />was already well below the statutory maximum allowed. (The reduction was from $xxx.xx per session to <br />$xxx,xx.) Even with these measures, our "bingo only" charities are finding it impossible to achieve <br />compliance. <br />The attached chart depicts the current state of affairs. You will notice that even though these operations <br />are profitable, they continue to fall further and further out of compliance. Should these trends continue, <br />one may readily conclude that their bingo operations will cease due to compliance issues. Our city does <br />not fee] that would be in the community's best interests. <br />Therefore, we are seeking your help in changing the statute to modify the lawful expense provision in order <br />to allow efficiently operated and profitable organizations to remain in business. While we readily agree <br />that expense control is integral to the oversight of lawful gambling, it appears the current provisions are <br />unrealistic in their expectations. <br />Thank you for your consideration of our request. <br />Sincerely, <br />Joel R. Hanson <br />City Administrator <br />