HB1786.DOC

SECTION 1. The legislature finds that the State is undergoing a significant and possibly protracted economic downturn in tandem with the national and global economic and financial crises. Numerous jobs have been lost, a number of large and small companies have declared bankruptcy or left the State, and many families have suffered foreclosure on their over-mortgaged houses. In the past year, the council on revenues has consistently reduced its forecasts of Hawaii's tax revenues. Across-the-board spending restrictions have already been put in place in state government and a general hiring freeze has already been implemented except in areas that impact public health and safety.

In the face of these extraordinary conditions, the State cannot proceed with business as usual. All resources must be examined to address critical statewide health, safety, and educational needs. Accordingly, the purpose of this Act is to generate additional general funds to ensure the delivery of critical services statewide by permitting gaming but restricted to only one location within the city and county of Honolulu and only for individuals who are over the age of twenty-one and who are either nonresidents of the State or who possess evidence of a paid round-trip ticket in the individual's name for travel to a final destination that is located outside the State.

SECTION 2. Casino gaming; definitions; commission; conditions; license; taxes and fees; rules. (a) As used in this section:

"Casino gaming" means the operation of games licensed under this chapter, including but not limited to baccarat, twenty‑one, poker, craps, slot machine, video game of chance, roulette wheel, klondike table, punch‑board, faro layout, keno layout, numbers ticket, push card, jar ticket, pull tab, or other game of chance that is authorized by the commission as a wagering device.

"Department" means the department of commerce and consumer affairs.

"Gross receipts" means the total of:

(1) Cash received as winnings;

(2) Cash received in payment for credit extended by a licensee to a patron for purposes of gaming; and

(3) Compensation received for conducting any game in which the licensee is not party to a wager.

Gross receipts do not include counterfeit money or tokens, coins of other countries that are received in gaming devices, cash taken in fraudulent acts perpetrated against a licensee for which the licensee is not reimbursed, and cash received as entry fees for contests or tournaments in which patrons compete for prizes.

"Individual" means a natural person.

(b) There is created a gaming commission within the department of commerce and consumer affairs. The governor shall appoint five members of the gaming commission pursuant to section 26-34, Hawaii Revised Statutes. The commission shall:

(1) Establish the qualifications of any applicants to conduct casino gaming under this section; provided that an applicant shall be a corporation properly incorporated in the State;

(2) Evaluate applicants and award, every five years, one five-year casino gaming license to a responsive and responsible applicant submitting the highest bid;

(3) Collect all taxes and fees imposed;

(4) Administer a problem gamblers program; and

(5) Regulate casino gaming established under this section.

(c) No individual may engage in wagering within the casino under this section unless the individual shows evidence to prove the individual:

(1) Is at least twenty-one years of age; and

(2) Is:

(A) A nonresident of the State; or

(B) Possesses a valid and fully-paid round-trip ticket or other voucher for travel on either an aircraft or ship for travel to a final destination that is outside the State.

(d) A tax shall be imposed on the monthly gross receipts received from casino gaming authorized under this section at the rate of seven per cent. The wagering tax imposed by this section shall be in lieu of all other state taxes on gross or adjusted gross receipts, except income taxes, including taxes levied under chapters 237 and 239. There shall also be imposed an annual fee of $250 on each casino gaming device as described in the definition of casino gaming, including but not limited to video or slot machines. All taxes and fees collected shall be deposited by the commission into the state general fund; provided that the following percentages of the wagering tax shall be retained by the commission to cover:

(1) Administrative costs: per cent; and

(2) Problem gamblers program: per cent.

(e) The commission shall all adopt necessary rules under chapter 91, Hawaii Revised Statutes, to implement this section.

SECTION 3. Chapter 712, Hawaii Revised Statutes, is amended by adding a new section to part III to be appropriately designated and to read as follows:

"§712‑ Casino gaming; exempted. This part shall not apply to casino gaming as authorized by Act , Session Laws of Hawaii 2009."

SECTION 4. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	1786
TWENTY-FIFTH LEGISLATURE, 2009
STATE OF HAWAII