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Amend the bill by striking out the title and substituting the following:
‘An Act To Establish a Competitive Bidding Process for the Operation of a Resort-style Casino in Southern Maine’
Amend the bill by striking out everything after the enacting clause and before the summary and inserting the following:
‘Sec. 1.  5 MRSA §12004-G, sub-§32-A  is enacted to read:
 
32-A.     
Sec. 2.  8 MRSA §1001, sub-§6-A  is enacted to read:
 
6-A.  Commission.     "Commission" means the Casino Development Commission created under section 1005-A.
Sec. 3. 8 MRSA §1003, sub-§2, ¶B, as enacted by PL 2003, c. 687, Pt. A, §5 and affected by Pt. B, §11, is amended to read:
 
B. Hear and decide all license and registration applications under this chapter and issues affecting the granting, suspension, revocation or renewal of licenses and registrations, including but not limited to applications received by the board from a person awarded the privilege by the commission to submit an application to operate a casino;
Sec. 4.  8 MRSA §1003, sub-§2, ¶B-1  is enacted to read:
 
B-1.  Hear and decide issues affecting the granting, suspension, revocation or renewal of licenses and registrations;
Sec. 5.  8 MRSA §1005-A  is enacted to read:
§ 1005-A. Casino Development Commission
 
1.  Establishment.     The Casino Development Commission, established in Title 5, section 12004-G, subsection 32-A, shall carry out the functions specified in this chapter with regard to awarding the privilege to apply for a casino or slot machine operator license through a competitive bid process and establishing a contract with the winning bidder upon issuance of a casino operator license by the board. The commission is affiliated with the board as specified in this chapter.
 
2.  Members.     The commission consists of 5 members appointed by the Governor. All members must be members of the general public without affiliation to the gaming or hospitality industry. At least 3 of the commission members must have training or experience in at least one of the following fields: corporate finance, economics, law, economic development and accounting. A municipal employee, county employee, elected official or candidate for elective office may not serve as a commission member.
 
3.  Term of office.     Members of the commission serve 3-year terms, except that the Governor shall initially appoint one member for a term of one year, 2 members for a term of 2 years and 2 members for a term of 3 years. A vacancy is filled by appointment for the remainder of the unexpired term of that member. Members whose terms expire serve until their successors are appointed and confirmed. Members may serve no more than 2 full consecutive terms on the commission.
 
4.  Confirmation.     Appointees to the commission must be reviewed by the joint standing committee of the Legislature having jurisdiction over gambling matters and are subject to confirmation by the Senate.
 
5.  Chair.     The commission members shall elect one member to serve as chair for at least a 2-year term.
 
6.  Quorum.     An action of the commission is not binding unless taken at a meeting at which at least 3 of the 5 members are present.
 
7.  Conflict of interest.     In addition to the restrictions imposed pursuant to Title 5, section 18, a commission member may not participate in any matter before the commission in which the commission member has a personal bias or any other conflict of interest as the commission determines, either on the commission's own motion or in response to a written complaint. During a commission member's term of service and for 5 years after the end of that commission member's service, any person with a direct and substantial interest in a gambling activity or gambling facility, including accommodations and amenities associated with a gambling facility, may not employ or be represented by the commission member or a member of the commission member's immediate family. For the purposes of this subsection, "direct and substantial" means ownership or control of more than 10% of the voting securities of a gambling facility, of an associated accommodation or associated amenity of a gambling facility or of an entity in contract, consort or cooperation with a gambling facility key executive.
Sec. 6. 8 MRSA §1011, sub-§2-B, as enacted by PL 2011, c. 699, §1, is repealed.
Sec. 7.  8 MRSA §1011, sub-§2-C  is enacted to read:
 
2-C.  Persons eligible for casino operator license on or after January 1, 2016.     Beginning January 1, 2016, the board may not accept an application for an initial license to operate a casino, slot machine facility or any other gambling facility for which the board has licensing authority, unless that application is submitted by a successful bidder for the privilege to submit an application to the board chosen pursuant to section 1011-A and the applicant has received approval by the voters of the municipality where the casino will be located.
Sec. 8.  8 MRSA §1011-A  is enacted to read:
§ 1011-A. Privilege to submit a casino operator license application for a southern casino pursuant to competitive bidding
The commission shall develop a request for proposals designed to encourage vigorous bidding for the purpose of awarding one bidder the privilege to submit an application to the board for a casino operator license. The commission shall request bids for the privilege to submit an application to the board for a resort-style casino in either York County or Cumberland County. A request for proposals must instruct potential bidders to propose the scope of the gambling facility and amenities to be offered in conjunction with the facility and how the proposal will ensure that the proposed casino will provide the State with socially responsible economic growth while operating as a successful business for the operator, considering license fees, minimum capital investment requirements, regulatory standards and required rates of revenue distribution. The commission may require submission of documented expert analysis from a bidder to support the proposals submitted by the bidder.
 
1.  Consideration of bids for privilege to submit casino operator license application to the board.     A bidder seeking award of the privilege to submit an application to the board for a license to operate a casino in York County or Cumberland County shall comply with the requirements determined by the commission. The commission shall require that a proposal for the privilege to submit an application to the board for the operation of a casino include a nonrefundable application fee of $250,000 and an agreement to pay the costs of the board for processing an application and performing background investigations, as described in section 1018, subsection 1, if awarded the privilege to submit an application to the board for a license to operate a casino. The commission shall ensure that the request for proposals clearly identifies the deadline for submission and all bid requirements. The commission shall follow, as nearly as practicable, the provisions governing competitive bidding prescribed by Title 5, chapter 155, subchapter 1-A and rules adopted pursuant to that subchapter.
 
2.  Request for proposals; factors; southern casino.     When considering bids received in response to a request for proposals prescribed in subsection 1 for a location in York County or Cumberland County, the commission shall consider the following:
 
A.  Business and market factors, including:
 
(1) The bidder's commitment and capacity to make an initial minimum capital investment of $250,000,000 for a resort-style casino facility. Land acquisition, license fees and off-site improvements are not considered to be part of the minimum capital investment;
 
(2) How the bidder's proposal can be expected to preserve existing jobs in the State and the number of net new full-time and part-time jobs that can be expected to be created by the operation of the proposed facility;
 
(3) The extent to which the bidder's market plans suit the character of the region and the local population in a way that encourages residents of the State to choose to patronize the bidder's proposed facility as opposed to gambling facilities in other states;
 
(4) The potential created by the bidder's proposal to create commercial development opportunities in the host location and surrounding communities consistent with historic uses, regional character and local zoning and planning requirements;
 
(5) The potential gross and net income to be generated by the bidder based upon documented, expert market analysis;
 
(6) The extent to which the bidder's proposed facility can reasonably be expected to serve as a significant regional and national tourism destination;
 
(7) How the bidder's proposal will result in the highest potential benefit and the highest prospective total revenues to the State from a bidder based upon documented, expert financial analysis;
 
(8) The bidder's proposed capital investment in a gambling facility, proposed amenities associated with the facility and timing of capital investment expenditures in terms of ensuring the facility is economically competitive in the State and regionally; and
 
(9) Other factors, properly disclosed in the commission's request for proposals, that the commission determines to be relevant;
 
B.  Economic development factors, including:
 
(1) The bidder's workforce development plan and the extent to which it will maximize use of the State's existing labor force and create new jobs in the marketplace;
 
(2) The impact on economic development, existing and planned, in the region of the proposed facility; and
 
(3) Other factors, properly disclosed in the commission's request for proposals, that the commission determines to be relevant;
 
C.  Site location factors, including:
 
(1) The adequacy of transportation infrastructure surrounding the proposed location of the gambling facility;
 
(2) The need for additional public infrastructure expenditures at or immediately surrounding the proposed location of the gambling facility;
 
(3) Any negative impact of the proposed location of the gambling facility on the municipality in which the facility is to be located, including but not limited to traffic congestion, worsened road safety conditions and increased safety concerns for pedestrian traffic;
 
(4) The bidder's proposals for mitigating negative impacts identified under this paragraph; and
 
(5) Other factors, properly disclosed in the commission's request for proposals, that the commission determines to be relevant; and
 
D.  Factors other than those listed in paragraphs A to C, including:
 
(1) The bidder's plan to identify, address and minimize the potential for and existence of negative consequences associated with gambling and the operation of the bidder's proposed facility, including but not limited to a financial commitment to efforts to address problem gambling prevention, intervention, treatment and research;
 
(2) The effects, both positive and negative, that can be reasonably anticipated to be experienced by the municipality in which the facility is located and the communities in the region; and
 
(3) The likelihood that the bidder will meet the casino operator license requirements described in section 1016.
 
3.  Bid award factor priorities; southern casino.     The commission shall develop a system of assigning points to the factors required to be considered under subsection 2. The commission is authorized to hire or enter into a contract with vendors experienced in evaluating business plans for large-scale development and the impacts of development on the local and regional economies to assist with the consideration of bids and development of the point system required by this subsection. The development of a point system must ensure that factors that support the following are awarded the highest point value, with the criteria listed under paragraphs A and B receiving more points than those listed under paragraphs C and D:
 
A.  The overall increase in the number of jobs created in the region that can be directly or indirectly attributed to the development and operation of the resort-style casino;
 
B.  The positive impacts on economic development, existing and planned, from the development and operation of the resort-style casino in the immediate region and the potential to positively impact the state economy, including opportunities to pursue developments that will create ongoing sources of revenue and employment for the region separate from the resort-style casino;
 
C.  The maximum potential benefits from the operation of the proposed resort-style casino on year-round tourism in the region; and
 
D.  The representation and incorporation by the proposed resort-style casino of the character of the State generally and, in particular, the character of the surrounding region consistent with historic uses, local planning and zoning requirements.
 
4.  Notice of award.     Upon award of the privilege to submit an application for a casino operator license to the board, the commission shall cite how the successful bidder’s proposal supported the priorities described in subsection 3.
 
5.  Contract required; southern casino.     A person who is selected as the winning bidder for the privilege to submit an application to the board for a casino operator license shall agree to enter into a contract with the commission that obligates the casino operator to the proposals made in the bid submitted in accordance with this section. In addition, the contract must include:
 
A.  A framework of reasonable financial penalties for failure of the casino operator to comply with the terms of the contract and the circumstances under which failure to comply with terms of the contract justifies withholding all net slot machine income and net table game income until the terms of the contract are satisfied; and
 
B.  Annual reinvestment requirements that direct the casino operator, beginning no sooner than 5 years after commencing operation of slot machines at the casino, to either make capital improvements to the casino facility or deposit with the board, in an account described in section 1018, subsection 2-B, an amount no less than 3% but no greater than 4% of net slot machine income and net table game income generated by the casino during the previous year.
 
The commission shall consult with the Office of the Attorney General during the negotiation and execution of the contract. The contract must be approved by the Attorney General. The casino operator license issued by the board does not take effect and the board may not accept the license fee required under section 1018, subsection 1, paragraph C-2 until the contract is executed.
Sec. 9. 8 MRSA §1018, sub-§1, ¶C, as enacted by PL 2003, c. 687, Pt. A, §5 and affected by Pt. B, §11, is amended to read:
 
C. The initial application fee for a slot machine operator license is $200,000. The annual renewal fee is $75,000 plus an amount, set by rules of the board, equal to the cost to the board of licensing slot machine operators and determined by dividing the costs of administering the slot machine operator licenses by the total number of slot machine operators licensed by the board. This paragraph applies to slot machine operator licenses initially issued before January 1, 2016.
Sec. 10. 8 MRSA §1018, sub-§1, ¶C-1, as amended by PL 2011, c. 417, §4, is further amended to read:
 
C-1. The initial application fee for a casino operator license is $225,000, except that the initial application fee for an applicant that is a commercial track that was licensed to operate slot machines as of January 1, 2011 is $25,000. The annual renewal fee is $80,000 plus an amount, set by rules of the board, equal to the cost to the board of licensing casino operators and determined by dividing the costs of administering the casino operator licenses by the total number of casino operators licensed by the board. In addition, a casino operator shall pay an initial gaming table fee of $100,000 for the privilege to operate each gaming table for a period of 20 years as long as the casino operator is licensed. Each gaming table is also subject to an annual gaming table renewal fee of $1,000. The gaming table fees authorize the casino operator to conduct any authorized table game at the gaming table during the 20-year period. A casino licensed in accordance with section 1011, subsection 2-A, paragraph A is not required to pay the gaming table fees until after one calendar year of table game operation. Fees collected in accordance with this paragraph must be deposited to the Gambling Control Board administrative expenses Other Special Revenue Funds account, which is a nonlapsing dedicated account. This paragraph applies to casino operator licenses initially issued before January 1, 2016.
Sec. 11.  8 MRSA §1018, sub-§1, ¶¶C-2, C-3 and C-4  are enacted to read:
 
C-2.  The fee for a casino operator license for a casino in York County or Cumberland County, issued in accordance with section 1011-A, is $10,000,000. The license fee must be deposited to the General Fund. The license fee is separate from the nonrefundable application fee required pursuant to section 1011-A, subsection 1 and the payment of costs to the board for processing the application and performing background investigations.
 
C-3.  The renewal fee for a casino operator license for a casino in York County or Cumberland County, issued in accordance with section 1011-A, is $250,000 due 5 years after the initial fee required under paragraph C-2.
 
C-4.  The annual registration fee for a slot machine and a table game operated at a casino licensed on or after January 1, 2016 is $100.
Sec. 12. 8 MRSA §1018, sub-§1-A, as enacted by PL 2011, c. 699, §2, is repealed.
Sec. 13. 8 MRSA §1018, sub-§2, as enacted by PL 2003, c. 687, Pt. A, §5 and affected by Pt. B, §11, is amended to read:
 
2. Term of license issued before January 1, 2016; renewal; renewal fees.  AllExcept for slot machine operator licenses and casino operator licenses issued on or after January 1, 2016, licenses issued by the board under this chapter are effective for one year, unless revoked or surrendered pursuant to subchapter 5. Upon proper application and payment of the required fees and taxes and in accordance with rules adopted by the board, the board may renew a license for an additional year if municipal approval has been obtained as provided in section 1012. The board shall transfer $25,000 of the renewal fee required by subsection 1, paragraph C to the municipality in which the slot machines are operated.
Sec. 14.  8 MRSA §1018, sub-§§2-A, 2-B and 3-A  are enacted to read:
 
2-A.  Term of license issued on or after January 1, 2016.     A casino operator license issued by the board pursuant to section 1011, subsection 2-C is effective for 5 years after the date of issuance unless revoked or surrendered pursuant to subchapter 5.
 
2-B.  Annual reinvestment requirements; southern casino.     A casino operator licensed by the board pursuant to section 1011, subsection 2-C operating a casino in York County or Cumberland County may deposit with the board the percentage of net slot machine income and net table game income required as an annual reinvestment pursuant to the contract executed in accordance with section 1011-A, subsection 5. The board shall hold the funds in an interest-bearing, nonlapsing account. The casino operator may request funds from the account for the purpose of making capital investments or improvements to the casino facility. If there are funds in the account and the casino ceases operation for a period of more than 90 days, the funds must be deposited to the General Fund.
 
3-A.  Licensee other than the original applicant; contract applicable.     If a person initially licensed to operate a casino after January 1, 2016 in York County or Cumberland County surrenders the license or the license is revoked, a subsequent licensee authorized by the board to operate the casino in accordance with this chapter is subject to the terms of the contract required by and executed under section 1011-A, subsection 5. A subsequent licensee is required to submit an application to the board and is subject to the licensing qualifications prescribed under section 1016.
Sec. 15. 8 MRSA §1019, sub-§6, as amended by PL 2011, c. 417, §5, is repealed.
Sec. 16. 8 MRSA §1019, sub-§7, as amended by PL 2011, c. 417, §6, is repealed.
Sec. 17. 8 MRSA §1020, sub-§3, as amended by PL 2011, c. 585, §8, is further amended to read:
 
3. Limits on total slot machines.   The board shall determine the number of slot machines to be registered in the State for casinos initially licensed prior to January 1, 2016. The board shall make this determination based upon the minimum net slot machine income, when distributed pursuant to section 1036, necessary to maintain the harness horse racing industry in this State, except that:
 
A. Except for slot machines used for training and educational purposes at postsecondary institutions as provided by section 1011, subsection 1-B, the total number of slot machines registered in the State for operation at casinos initially licensed prior to January 1, 2016 may not exceed 3,000; and
 
B. A slot machine operator initially licensed prior to January 1, 2016 may not operate more than 1,500 slot machines at any one commercial track and a casino operator initially licensed prior to January 1, 2016 may not operate more than 1,500 slot machines at a casino.
Sec. 18.  8 MRSA §1036, sub-§2-D  is enacted to read:
 
2-D.  Distribution of slot machine and table game income from a casino in York County or Cumberland County.     A casino operator licensed to operate a casino in York County or Cumberland County pursuant to section 1011-A shall collect and distribute 35% of net slot machine income and 16% of net table game income to the board. The distributions must be held by the board until a distribution is established by the Legislature for net slot machine income and net table game income generated by a casino.
Sec. 19.  8 MRSA §1036-A  is enacted to read:
§ 1036-A. Distributions of slot machine and table game income upon operation of a gambling facility licensed after January 1, 2016
The board may not make distributions as provided by section 1036, subsections 1, 2, 2-A, 2-B and 2-C after the commencement of operations of a gambling facility subject to licensure by the board initially licensed after January 1, 2016. Net slot machine income and net table game income collected by a casino operator or slot machine facility operator in accordance with section 1036, subsections 1, 2, 2-A, 2-B and 2-C must be held by the board until a distribution of 35% of net slot machine income and a distribution of 16% of net table game income is established by the Legislature that provides for a distribution of net slot machine income and net table game income that applies, in the same manner, to each gambling facility licensed in accordance with this chapter.
Sec. 20. Statutory referendum procedure; submission at election; form of question; effective date. This Act must be submitted to the legal voters of the State at a statewide election held in the month of November following passage of this Act. The municipal officers of this State shall notify the inhabitants of their respective cities, towns and plantations to meet, in the manner prescribed by law for holding a statewide election, to vote on the acceptance or rejection of this Act by voting on the following question:
 
"Do you favor the operation of a resort-style casino, licensed pursuant to a competitive bid process, in either York County or Cumberland County?"
 
The legal voters of each city, town and plantation shall vote by ballot on this question and designate their choice by a cross or check mark placed within a corresponding square below the word "Yes" or "No." The ballots must be received, sorted, counted and declared in open ward, town and plantation meetings and returns made to the Secretary of State in the same manner as votes for members of the Legislature. The Governor shall review the returns. If a majority of the legal votes are cast in favor of this Act, the Governor shall proclaim the result without delay and this Act becomes effective 30 days after the date of the proclamation.
The Secretary of State shall prepare and furnish to each city, town and plantation all ballots, returns and copies of this Act necessary to carry out the purposes of this referendum.’
 
SUMMARY
This amendment replaces the bill and is a minority report of the committee. The amendment establishes a competitive bid process for the operation of a resort-style casino in either York County or Cumberland County. The amendment establishes the Casino Development Commission, which is an independent board of 5 members appointed by the Governor and confirmed by the Senate. The commission’s purpose is to develop a request for proposals for the privilege to submit an application to the Department of Public Safety, Gambling Control Board for a casino operator license. The fee to submit a bid is $250,000. The amendment provides for specific supporting information to be submitted by the bidder and considered by the commission including the bidder's ability to make a minimum $250,000,000 capital investment in the resort-style casino and information regarding job creation, economic development and plans to mitigate negative infrastructure impacts. Under the amendment, the commission is directed to develop a point system for the factors to be considered and give priority to factors that create jobs, promote economic development, increase tourism and support a casino that fits the character of the State, with job creation and economic development being the highest priorities. The winning bidder must enter into a contract with the commission that obligates the casino operator to abide by the proposals made in the winning bid. The contract includes a commitment of the casino operator to make annual reinvestments in the facility of an amount no less than 3% but no greater than 4% of net gambling revenue. Failure to abide by the terms of the contract could result in financial penalties to the operator.
The license fee for a casino under the amendment is $10,000,000, which is deposited into the General Fund. The amendment sets the distribution of net slot machine revenue at 35% and the distribution of net table game revenue at 16% for the resort-style casino. Upon operation of slot machines at the resort-style casino, the board will hold distributions required of existing casinos until the Legislature establishes a single distribution structure that would apply to all casinos in the State that establishes a distribution of 35% of net slot machine revenue and 16% of net table game revenue.
Finally, the amendment makes enactment of this bill contingent upon the approval of the voters of the State at a statewide referendum election.
FISCAL NOTE REQUIRED
(See attached)