CCP 05-26-1992 - Laserfiche WebLink

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"- . Charitable Gambling Page Two 2. Consider chan:J"ing the ordinance definition of net profit to include subtractions f= taxes paid. 3. Work with the Licensees to explain the current Ordinance carrpliance situation, develop a payment document to calculate future contriWtions beginning with second quarter 1992, and commit staff resources to regulate carrpliance. nus approach is very proactive in nature and cornrmmicates a reconciliation theme. Before discussing these or other alternatives you may have, I believe the Council should also consider a revenue opporbmity that would work in concert with the 10 percent profit contriWtion. state law pennits the imposition of up to a three percent gambling tax of the gross profit on licensed organizations. 'Ihis tax must only raise such revenues as are necessary to cover the costs the City incurs in regulating lawful gambling. The City must make an annual report to the state Galnbling Board shcMing the amount of revenue raised by the tax and the use of the tax proceeds. One possibility for the current level of noncarrpliance may be that city . staff has not been diligent in regulating the gambling activities because of resource limitations. 'Ihe imposition of a gambling tax could fund the I'''''''''''''''?ry resource requirements. Another benefit to having dedicated resources available would be to monitor the organization's carrpliance with the "spending in the local trade area" requirement of the ordinance on a more regular basis. The seven licensed organizations are currently generating some $2.0 to $2.5 million in annual gambling gross profits within the City. 'lhe imposition of a one, two or three percent gambling tax would generate approxiInately $20,000, $40,000, and $60,000 per year to regulate gambling activities. I will attend the May 26 meeting to answer Council questions. REX:XM1ENDATION: Whatever enforcement option is chosen, I believe all of the licensed organizations should be monitored on a regular and consistent basis. 'Ihis presumes a level of resource commitment that has not previously been present. TPjts M92-173 .