Allied Charities of Minnesota

News

  • 13 Dec 2020 14:11 | Allen Lund (Administrator)

    Liquor License of East Grand Forks Bar suspended

    The Minnesota Department of Public Safety Alcohol and Gambling Enforcement division (DPS-AGED) has suspended the liquor license of the Boardwalk Bar & Grill LLC in East Grand Forks, Minn., for continuing to violate Executive Order 20-99. The 60-day suspension is effective now until Feb. 9, 2021.

    Further violations will result in a five-year liquor license revocation.

    Executive Order 20-99 Implementing a Four Week Dial Back on Certain Activities to Slow the Spread of COVID-19, prohibits all restaurants and bars from selling alcohol for on-premises consumption from Nov. 20, 2020, at 11:59 p.m. through Dec. 18, 2020, at 11:59 p.m.

    The Attorney General and the Minnesota Department of Health have also taken action in an effort to bring this establishment into compliance with the Executive Order.  The Polk County District Court on Friday  granted the Attorney General’s motion for a temporary restraining order to prohibit the Boardwalk Bar and Grill from remaining open to the public for on-premises dining, as required under Executive Order 20-99

    “While we recognize the struggles that bars and liquor establishments have experienced, willful disregard of the law that puts Minnesotans in danger cannot and will not be ignored. People's lives have to take precedent during this pandemic,” said Public Safety Commissioner John Harrington. “We will continue to work with our local public safety and business partners to educate and provide advice to slow the spread of COVID-19.”

    The DPS-AGED suspension letter is attached.

    Advisory to the liquor industry

    DPS-AGED has sent a letter to the liquor industry with further information related to Executive Order 20-99, reminding licensees that:

    • All restaurants and bars are prohibited from selling alcohol for on-premises consumption from Nov. 20, 2020, at 11:59 p.m. through Dec. 18, 2020, at 11:59 p.m.
    • Establishments with on-sale liquor licenses are allowed to sell beer and wine with takeout orders pursuant to legislation signed by Governor Walz in April of this year.
    • Any liquor licensee found to be in violation of EO-99 may be issued a misdemeanor citation for the violation.
    • A second violation shall result in a 60-day liquor license suspension.
    • A third or subsequent violation shall result in a five-year revocation of the liquor license and the subsequent revocation of the establishment’s retail identification card (buyer’s card). Minn. Stat. § 340A.415.


  • 13 Dec 2020 09:43 | Allen Lund (Administrator)

    Members,

    The Department of Public Safety, Alcohol and Gambling Enforcement Division has asked me to forward the attached.

    While not specifically mentioning charitable gambling, a licensed charitable gambling organization found in violation of an executive order would face consequences. 

    Governor Walz has said that he will have an announcement this coming Wednesday in regards to the current bans that are set to expire on Friday, December 18 at 11:59 pm


    FINAL December 2020 Liquor Industry Advisory letterhead (1).pdf

  • 11 Dec 2020 07:59 | Allen Lund (Administrator)

    Members,

    The MN Lottery has unveiled their 2020 Holiday ad blitz . In their television/print ads on a background of scratch off tickets are the words GIVE JOY, GET JOY. See an ad at https://www.mnlottery.com/holiday-games-2020

    I buy a lottery ticket or two when the amounts are out of this world. I cannot tell you the last time that I bought a scratch off ticket.

    I have some observations in regards to the MN Lottery. Their payout averages 62%. They spend millions of dollars each year advertising their product. They make their product look more attractive/profitable than it is.  

    Their rule book is less than 20 pages, while ours is over 200 (statutes and rules). They operate under the belief that anything not expressly prohibited is allowed while we know that for us anything not expressly allowed is prohibited.

    Even if charitable gambling had the resources to advertise like the MN Lottery I would hope that we would not tell people that buying our product would bring joy.

    Regards,

    Al Lund


  • 05 Dec 2020 08:05 | Allen Lund (Administrator)

    Members,

    Pete Williams from the Backus American Legion had contacted his State Representative Sandy Layman. Please see her response below.

    Thank you to Pete and to all who contacted their state legislators.

    Regards,

    Al


    “The GCB recently posted the FY 2020 Annual Report on its website. Here’s the link:   http://mn.gov/gcb/assets/fy2020-annual-report.pdf

     

    What is noticeable to the public is that the GCB has included more detail than ever before in terms of profitability analysis and use of funds in this Report. Engaged gambling managers should find lots of new, useful information disseminated in this report. Detailed statewide information is available in the agency’s annual report.  These numbers can be used by organizations to compare themselves with the statewide averages for different types of operations.

     

    In terms of not posting each individual organization’s data, to date this has not been an immediate agency priority, as the purpose of this data is posted to reflect organizations’ ability to meet the annual statutory Star Rating requirement (use of profits for lawful purposes). You may recall during the 2020 First Special Session, the Board proposed and the Legislature approved pandemic relief measures based on industry input. This resulted in the Statutory requirement being waived.  The reported numbers are only based on income and expenditures through June 30, 2020.  Loans, cash banks, inventory, federal aid, and other factors caused organizations reported income and expenditures as of June 30 to not accurately reflect a gambling operation’s overall health or efficiency.

     

    Now that the Annual Report to the Governor and Legislature has been posted, the Board can prioritize other issues. Posting the individual numbers with the caveat to explain the waiver and the lack of meaningful results can occur. We endeavor to accomplish this within the next 2 weeks. In the meantime, data requests for information and communicating with assigned staff to obtain statistics free of charge remain as methods available to organizations.”

     

    As noted in the final paragraph, the Board plans to issue the individualized reporting you are seeking.

     

    Best regards, 

     

     

    Sandy Layman

    State Representative District 5B

    651-296-4936



  • 04 Dec 2020 07:36 | Allen Lund (Administrator)

    There will be no automatic extensions for filing or paying.  However, organizations may ask us to cancel or reduce filing or payment penalties if they have a reasonable cause or are negatively affected by the COVID-19 pandemic. For more information, updates, and resources, see Our Response to COVID-19.

  • 04 Dec 2020 06:13 | Allen Lund (Administrator)
    U.S. Bank Stadium reserve predicted to balloon to nearly half a billion dollars by 2025

    By Rochelle Olson Star Tribune

    December 3, 2020 — 9:53pm

    Fueled by surprisingly strong electronic pulltab proceeds even amid a pandemic, the state fund set up to pay off U.S. Bank Stadium debt is now projected to balloon to nearly half a billion dollars in the next five years.

    The stadium reserve fund is expected to grow to $419 million by mid-2025, according to the budget forecast released this week by state economists. Though the fund relies on the e-pulltab games played at bars, in a year when eating and drinking establishments have endured several forced closures, it’s still expected to jump to $81 million by the end of the current fiscal year in June.

    Legislators return in January for a session likely to be dominated by figuring out how to fill a projected $1.3 billion gap between tax collections and spending obligations in the ensuing two years.

    “That’s going to attract a lot of attention. There’s going to be a lot of people who look at that and say, ‘Yeah, we can do something with that money,’ ” said Allen Lund, executive director of Allied Charities, whose members run the pulltab operations across the state — and who has some ideas of his own for all that pulltab money.

    At the Capitol, when there’s cash collecting in a reserve, there’s no shortage of ideas on how to spend it — especially in challenging economic times.

    The city of Minneapolis, home to the stadium and a contributor to its construction, is asking for relief from the state for its first $17 million payment on the building next year. Gov. Tim Walz floated the idea of using some of it to help those experiencing homelessness.

    But the Minnesota Vikings, also financial contributors to the stadium, want to wait until 2023 when the debt can be refinanced on a tax-exempt basis for maximum savings — and the building could be paid off a decade early. The team got strong support for that position from both parties, and from a veteran lawmaker who was in the room when the stadium deal was cut.

    “I will absolutely fight to the death anybody who thinks they can raid that fund,” Sen. Tom Bakk of Cook said this week. A former Senate DFL leader, Bakk recently turned independent, and the Senate’s Republican majority tapped him to chair the Senate’s public construction committee.

    Bakk said he’s “determined” to pay the bonds back early on U.S. Bank Stadium.

    “We worked on that thing for a decade and I am not going to take that apart,” Bakk said.

    The Legislature legalized e-pulltabs, located in bars that host local charitable gaming operations, to cover the state’s share of the $1.1 billion, public-private stadium. The public share of the stadium tab came to $498 million, with $348 million coming from the state and $150 million from Minneapolis. The Vikings, as the main tenant, are paying the rest.

    The state uses the pulltab revenue to make annual payments on the debt. Last year, the state paid $42 million. The payment will be $44 million by 2025. After the annual payment is made, excess pulltab revenue is funneled to the stadium reserve.

    In 2025, the excess expected to flow to the reserve is $99 million. Underpinning the numbers are pulltab sales, which account for 95% of the state’s gambling revenue.

    In the first third of the current fiscal year — July through October — gross gambling sales already hit 50% of the entire previous year at just over $1 billion. Gross sales for all of the previous year, which ended June 30, were just over $2 billion.

    “After the first shutdown, we came on stronger and faster than I ever thought we would,” Lund said.

    Lund has argued unsuccessfully for more money for the charitable operators. Even as profits increase, he said, charities are getting a smaller share.

    Charitable gambling wasn’t “meant to help rich people, it was meant to help people that need help,” Lund said.

    In 2012, the charitable operations received 6 cents on the dollar spent for pulltabs. By 2019, the number was 3.5 cents. This year it’s 3.29 cents, Lund said.

    “Everybody else tends to do better every year and we keep doing worse,” he said. “We’re supposed to be the reason for the season.”

    State leaders started to notice the swelling nature of the stadium reserve a year ago. The Vikings have stuck with the position that the money shouldn’t be diverted to other uses.

    “We are back on the mantra of ‘use the money for its intended purpose,’ ” Vikings Vice President Lester Bagley said.

    The city of Minneapolis’ stadium debt comes due next year with an expected payment of $17 million. State Rep. Mohamud Noor, DFL-Minneapolis, said the city “absolutely” wants relief from the first payment — and he said there should be a “longer-term conversation” about what to do with the rest of the reserve.

    Sen. Julie Rosen, chairwoman of the Senate Finance Committee, cautioned that the reserve is still a projection and, she said, a “little vulnerable.” Paying off the debt as efficiently as possible is still the best option, she said.

    House Speaker Melissa Hortman, DFL-Brooklyn Park, also sounded cautious about tapping the pulltab reserves.

    “Yes, there’s a surplus there now, and it does look appealing to meet immediate needs,” Hortman said this week. “But we have to balance that against the possibility in the future of refinancing and saving taxpayer dollars.”

     

    Rochelle Olson • 612-673-1747

    Twitter: @rochelleolson


  • 01 Dec 2020 07:54 | Allen Lund (Administrator)

    Pull-tab Sales at Liquor Stores

    Many gambling managers have the impression that because off-sale liquor stores may continue to sell pull-tabs at this time, and, per executive order, on-sale bars can now also sell off-sale beer and wine, that all bars may therefore sell pull-tabs.  However, that conclusion is incorrect.

    Only bar and restaurant locations with an off-sale liquor license may conduct pull-tabs at this time – provided that the pull-tabs are conducted in a portion of a building with a separate entrance where on-site eating and drinking was not previously allowed. Although executive order temporarily allows bars with on-sale licenses to conduct some limited off-sale, very few locations have an actual off-sale license. Again, bars without an off-sale license and a separate entrance into an exclusively off-sale portion of the building are not allowed to sell pull-tabs.

    Guidance for Reporting “Paused” Games

    On Friday, November 20 organizations were allowed the option of “pausing” their pull-tab games in play rather than closing them. Pausing a game means that the organization may put that same game back into play once their premises reopens for on-site eating and drinking.  The proceeds from paused games must be deposited into the gambling account within 4 business days after the game was paused.  However, the game is not reported as closed on monthly reports until the game has been placed into play again and then removed from play.

    Pausing games creates some unique reporting issues at month-end. The instructions below are meant to help your organization report paused games correctly so that your Profit Carryover Reconciliation, form LG100F, will balance.

    There are three important numbers for an organization to remember when pausing their games; the amount of their cash bank for the games being paused, their deposit total, and the difference between those two numbers (which should be an indication of what the net receipts were for the games at the time they were paused).

    Organizations should take the following steps:

    • Deposit all the cash from each site (“Deposit Total” in the examples below) into their gambling bank account.
    • On the LG100A, Lawful Gambling Receipts and Expenses per Site, reduce the starting cash bank amount for the games that are paused at the site to $0.
    • Report the difference amount from the starting cash bank and deposit total amounts on the LG100F line 14 (the difference amount can be positive or negative depending on the circumstance).
    • When re-opening a site, withdraw the same “Deposit Total” that they initially deposited and report the same cash bank amount that they had at the time the games were paused.

    Click here for examples of how the reporting would work out depending on the starting cash banks as compared to the net receipts for each game. If you have questions, please contact your Compliance Auditor for assistance.

    Continuing Education Opportunities

    A new continuing education class on lawful purpose expenditures is now available by clicking on the following link: CE – Lawful Purpose Expenditures. It’s a video-based course presented by Nichole Engeswick, a Compliance Auditor working out of our Mankato office.  Participants will watch four videos with a total combined running time of about 40 minutes and answer a few questions at the end of each video.

    In addition to the “Lawful Purpose Expenditures” class, on December 11, 2020 at 10:00 AM, Executive Director Matt Gettman will be presenting a live continuing education class that gambling managers can view on their computers. The class will cover a variety of topics of current interest and qualify for continuing education credit.

    Prior to the webinar, participants will need to install Webex on their computers (click on the link to download) in order to register and view the course. Once you’ve installed Webex, click on this link to register: GCBCE 12-11-20. You will need to enter your organization name and license number. You’ll then receive a confirmation email with instructions on how to join the class at the appropriate time. The class is expected to last approximately 60 minutes.

    Information on these and other continuing education classes is also available under the “Education” tab by  selecting the “Continuing Education” menu option.

    2020-gn-octnovdec.pdf


  • 30 Nov 2020 08:14 | Allen Lund (Administrator)

    Members,

    It has come to the attention of Allied Charities of Minnesota and verified by the GCB that they will no longer post the FY numbers by individual licensed organizations. The organization annual reports posted on the GCB website was what I would use to do my deep dive into the numbers.

    On Friday, November 20 I asked them to rescind their decision and post the fiscal year end numbers for individual organizations. As of today, Monday, November 30th I have had no response.

    It was also the report that I kept legislators informed of as to the health of the licensed organizations in their respective districts and the good works being done in their district. Over the years I have had many legislators thank ACM for supplying them with the information.

    Transparency in government is a good thing. It seems that the GCB is “turning the dial back” on transparency. As it stands now the only information that we will get from the GCB moving forward is the information that they deem appropriate for us to see.

    Surprise cash audits, surprise LPE audits and unannounced site inspections (even on the Friday of the latest lockdown) are now the order of the day.

    ACM is asking the Governor and I am asking my two legislators to review this change in policy. ACM is asking that it be rescinded and the FY detail reports by organization be made available on the GCB website. I would ask you to do the same. You can find out who represents you at https://www.gis.leg.mn/iMaps/districts/

    Regards,

    Al


  • 27 Nov 2020 08:23 | Allen Lund (Administrator)

    Counterpoint: Problem gambling is not a 'sin.' It's a disease

    For some, it's a disease of the brain — one with few outward signs — that can destroy lives. 

    By Susan Sheridan Tucker

     

    NOVEMBER 25, 2020 — 5:52PM

    WAYNE PARRY • ASSOCIATED PRESS

    Problem gambling isn’t a sin, the writer argues. For some, it’s a disease.

    I cringe when I see “sin taxes” associated with gambling (“Liquor, lotto are COVID escapes,” Nov. 22). I understand the intent. Too often we view excessive gambling as a moral weakness. We believe these “problem or compulsive gamblers” lack the willpower to stop and must endure the shameful labels we easily apply.

    Most Minnesotans who gamble (78%), do so as entertainment and do not suffer serious negative consequences. However, on behalf of those who struggle, I’m asking Minnesotans to see beyond the “sin.”

    The impact of a gambling disorder on individuals and their families is devastating. It is a disease of the brain, one with few outward signs. It can destroy relationships as well as bring financial ruin to an entire family who may be completely in the dark until a loved one has gambled away their assets.

    As an advocate with Northstar Problem Gambling Alliance (NPGA), I’d like to share the most basic facts about gambling addiction:

    Nationwide, 4% of the population lands somewhere on the problem gambling spectrum, with over 1% meeting medical criteria for a gambling disorder. Anyone who has experienced this condition will tell you that being able to “walk away” from an addiction is just not possible. Medical experts agree: Gambling can be a real addiction and one often accompanied by other mental health issues and addictions. It’s also the addiction with the highest suicide rate.

    Under COVID-19 conditions, many Minnesotans are under financial and emotional duress, whether it’s unemployment, inability to pay bills, food insecurity, fear of eviction, isolation from friends and family, dealing with sick family members, personally fighting the illness, and political and social uncertainty; all of which create the perfect storm for chronic stress.

    Those vulnerable before COVID-19 may now be more so and likely many more are turning to gambling as a means to escape the pains of our current reality. We know many are turning to online gambling sites, social casino games, and video games with embedded gambling elements. These are unregulated sites, sometimes predatory by design. Some in fact take your money and only provide virtual rewards. The number of players in these unregulated arenas is growing.

    COVID-19 has placed huge economic burdens on every state and expanding gambling options may indeed provide new and needed revenue streams. NPGA remains neutral on the legalization of gambling but insists that comprehensive consumer protections be in place and that funds be set aside for prevention, treatment and research.

    NPGA benefits from legislative funding through the lottery and charitable gambling. Those funds enable us to provide outreach, training and research across the state. The state has also set up a fund for treatment, administered by the Department of Human Services. Services are currently available through telehealth during COVID-19.

    If you or someone you care about is exhibiting signs of problematic gambling, help is available and it works. Call the state helpline at 1-800-333-4673 (HOPE) any time, any day or visit northstarpg.org for more resources and information.

     

    Susan Sheridan Tucker is executive director, Northstar Problem Gambling Alliance.


  • 22 Nov 2020 10:17 | Allen Lund (Administrator)

    Members,

    Please see the article below. There are those in the legislature that do not believe that we pay enough in taxes to the state. They have told me that if the choice were theirs that they would raise our taxes. Something to pay attention to this next session as the state deals with a deficit. 

    Regards,

    Al

    Millions in 'sin taxes' flowing into state coffers during pandemic

    By Jessie Van Berkel Star Tribune

    November 21, 2020 — 8:09pm

    Annie Santos headed to the store for some emergency supplies after a distressing message from her children’s school.

    “We just got the e-mail from school saying, ‘We’re switching to distance learning,’ ” Santos said, laughing in the parking lot of the St. Paul Haskell’s. “So I’m like, I’m going to go get wine.”

    Stressed-out parents are pouring themselves an extra glass. Workers stuck at home are breaking up the monotony with more frequent smoke breaks or punctuating the day with a post-work beer. And people seeking a little excitement — or avoiding casinos — are rushing to the lottery and pulltabs as a welcome distraction.

    Minnesotans’ extra spending on those vices is adding up.

    State revenue from the so-called “sin taxes” was nearly $37 million more than predicted in July through September. Tobacco tax dollars alone were $20 million more than anticipated, and collections from some types of gambling, like pulltabs and bingo, were double what was expected.

    The growth in revenue in these areas comes as the pandemic has hurt many businesses, nonprofits and families across the state, leaving the state with a projected deficit of $2.3 billion over the two-year budget cycle.

    It is not just Minnesotans who are indulging. Sin taxes are an area where pandemic-rattled state budgets appear to be holding strong across the country, said Brian Sigritz with the National Association of State Budget Officers. As governors and legislatures scramble for options to shore up massive budget gaps, Sigritz said he expects more states will consider increased sin taxes as well as legalizing sports betting and recreational marijuana. Minnesota has not legalized either of those, but the proposals have been floated in years past.

    House DFL Tax Committee Chairman Paul Marquart rejected the idea of increased taxes on tobacco, alcohol or gambling. He said he opposes any regressive taxes that hit poor people harder. His Senate counterpart, GOP Tax Chairman Roger Chamberlain, declined to comment. A spokesman for Democratic Gov. Tim Walz said it is too soon to weigh in on the subject, and the governor has not yet discussed raising those taxes. However, Walz and House DFL leaders support legalizing recreational marijuana.

    As state leaders are trying to figure out how to weather the pandemic, so are Minnesotans. People are grappling with losing family members or their jobs and struggling with the emotional and logistical challenges of social distancing.

    Lance Klatt, executive director of the state Service Station and Convenience Store Association, said he suspects the rise in lottery and tobacco sales is due to Minnesotans seeking a diversion during a year of deep uncertainty.

    “When people are just stressed out, they turn to tobacco and alcohol to get through it,” Klatt said. “Maybe people said, ‘Hey, if I’m going to socialize, I’m going to do it at home and smoke a cigar or smoke cigarettes.’ ”

    Customers at Twones Tobacco in St. Paul have told manager Emrah Kadric there are just fewer things to do so they are using their vape pens, chewing tobacco or other products more often. Kadric said he isn’t seeing a lot of new customers, but the usual people are buying more. He estimated sales have been up 20% during the pandemic.

    Jordan Scott has been an on-and-off cigarette smoker. The Minneapolis resident started back up since he’s been working from home.

    “It’s easier to go out for more breaks,” Scott said. He’s also buying more alcohol and “cracking that first one open a little earlier than before.”

    However, he said his liquor store purchases have increased largely because he doesn’t go out to drink anymore.

    “I haven’t gone out to a bar since they really all shut down in March,” Scott said.

    From July through September, the state netted roughly $2.5 million more in alcohol tax revenue than expected.

    “It’s a faster pace, there’s no doubt about it,” said Brent Gregoire, manager of the Haskell’s liquor store. “They are buying a little more, less frequently. They make a little bit bigger purchase so they don’t have to go out as much.”

    People are not just spending more than anticipated on booze, tobacco and gambling. Sales tax revenue in general was 26% higher than predicted for July through September, with the federal unemployment insurance payments helping buoy spending, state economist Laura Kalambokidis said.

    An extra $20 million in tobacco taxes and $2.5 million from alcohol sounds small when total state revenue for the year is about $21 billion. But the state is facing a multibillion-dollar hole for the current two-year budget and a bigger shortfall in the years after that, Kalambokidis said.

    “What look like relatively small revenue sources all matter,” Kalambokidis said. “A $20 million program could be extremely important to quite a number of Minnesotans.”

    The biggest revenue surprise, Kalambokidis said, was the jump in lawful gambling, which includes pulltabs, bingo and raffles.

    State budget officials predicted they would get $9.5 million in tax revenue from that type of gambling in July through September. They got more than $21 million.

    Pulltabs made up 94.5% of lawful gambling sales last year. While electronic pulltabs are growing in popularity, the old-school paper ones common in bars across the state account for most sales.

    The popularity of lawful gambling has climbed over the past decade, said Gary Danger, a compliance officer for the Minnesota Gambling Control Board. They were preparing for March to be their biggest month ever, then halfway through the month, Walz shut down bars and restaurants. There was a pent-up demand when things reopened in June.

    “Things have come back bigger than ever,” Danger said.

    Like pulltabs, Minnesota lottery purchases have been growing for years. But 2020 has been a significant jump, state lottery Executive Director Adam Prock said. In July through September the state’s lottery sales were up 25% to nearly $181 million, compared to the same time last year.

    Klatt, who represents the gas station and convenience stores, said they are likely selling more scratch-offs and other lottery games because people are not going to the casinos as much.

    Prock said customers tell them it is a way to bring a little fun into another night at home.

    “People say, ‘Well, my husband and I don’t do puzzles. We buy a few dollars in lottery tickets and it’s become our Friday night thing,’ ” Prock said. “We’re filling that niche right now.”


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