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• Arden Hills Council 5 May 26 , 1992 <br /> Post said his concern is that the majority of licensees are <br /> including taxes as an "allowable expense" . The result is that <br /> most licensees are paying the City 10% after taxes rather than <br /> before taxes , and the City is collecting about $60 , 000 less <br /> than it should be . <br /> Attorney Filla explained that it is a "lawful purpose" for <br /> charitable gambling licensees to pay taxes , but taxes are not <br /> included as an "allowable expense" as defined by the State <br /> Gambling Control Board . <br /> Post identified three alternative actions to address this <br /> issue : 1) Amend the ordinance to redefine licensees ' <br /> obligation to the City; 2 ) Collect retroactively from the <br /> licensees ; 3 ) Clarify with licensees their obligations per <br /> current ordinance . <br /> MOTION: Hicks moved, seconded by Growe , to notify charitable <br /> gambling licensees that effective July 1 , 1992 : <br /> 1 ) The method of calculating their gross profits will <br /> be per ordinance , i . e . , gambling receipts less <br /> prizes and awards , less allowable expenses , equal <br /> • gross profits ; <br /> 2 ) The City expects to receive 10% of gross profits ; <br /> 3) Allowable expenses does not include any level of <br /> taxes . <br /> Councilmembers Mahowald and Malone commented that is seems <br /> reasonable to include certain expenses as "allowable <br /> expenses" , but perhaps computing the City ' s 10o based upon <br /> pre-tax figures could be construed as imposing a sort of <br /> double jeopardy . <br /> Mayor Sather commented that he would be inclined to support <br /> Councilmember Hick' s motion because the City must be <br /> responsible to collect from every appropriate legal revenue <br /> source; in this case the City is missing a revenue <br /> opportunity . <br /> Councilmember Malone commented that it has become much more <br /> difficult and time-consuming to administer and enforce <br /> charitable gambling operations than the City originally <br /> anticipated . <br /> Councilmember Mahowald suggested further thought and review of <br /> this item before taking action. <br /> • Councilmember Hicks withdrew his motion, Growe withdrew her <br /> second. <br />