Page 1,
strike lines 2 through 43
Strike pages
2 through 42
Page 43,
strike lines 1 through 4, insert:
"Section 1. Title 5, Arizona Revised Statutes, is
amended by adding chapter 10, to read:
CHAPTER
10
SPORTS
BETTING
ARTICLE
1. GENERAL PROVISIONS
START_STATUTE5-1201. Sports
betting; authority to contract with licensed liquor establishments;
requirements
A. Each
federally recognized Indian tribe that has a tribal-state gaming compact
entered into pursuant to chapter 6 of this title and that has tribal
headquarters on Indian lands located in this state may operate sports betting
as defined in section 13-3301. No other person or entity may
operate sports betting.
B. An
indian tribe that is authorized to operate sports betting pursuant to this
section may operate sports betting through kiosks or similar machines that are
located at one or more premises that have a bar license, a beer and wine bar
license or a private club license that is issued pursuant to title 4 and may
enter into a lease or a rental agreement for the purpose of operating sports
betting with a person that holds a bar license, a beer and wine bar license or
a private club license. This subsection does not allow an indian
tribe to operate more gaming devices than otherwise allocated under section 5-601.02. This
subsection shall be construed in a manner that is consistent with the gaming
device operating rights prescribed in section 5-601.02.
C. If
an indian tribe enters into an agreement for rent, lease or licensing or for
the provision of marketing, technical, administrative or management services,
these agreements shall affirm that the indian tribe is the sole and exclusive
operator of all sports betting activity that is authorized under this
chapter. Any agreement that does not comply with this subsection is
of no force and effect.
D. This
chapter does not amend any tribal-state gaming compact executed pursuant
to section 5-601.02. END_STATUTE
START_STATUTE5-1202. Department
of gaming; sports betting licensing; rules
A. To
ensure honesty and integrity in the gambling activity, the department of gaming
shall regulate sports betting under this chapter in a manner that is consistent
with the regulation of tribal gaming pursuant to section 5-602. An
indian tribe may operate sports betting through a tribal gaming operator that
is wholly owned by the Indian tribe. The tribal gaming operator is
subject to licensure.
B. The
department of gaming may adopt rules to carry out the purposes of this section.
C. For
the purposes of licensure, The owner, partner, shareholders or beneficiaries of
the tribal gaming operator do not INCLUDE the members or government officials
of an indian tribe.END_STATUTE"
Renumber to
conform
Page 44,
strike lines 7 through 10
Renumber to
conform
Line 17,
strike "and" insert "and"; after
"insurance" insert a period strike remainder of line
Strike line 18
Strike lines
38 and 39
Page
45, between lines 10 and 11, insert:
"8. "Sports betting":
(a) Means
the placement of a wager on the outcome of a sporting event where a winning
outcome is based on the score, point total, point spread or performance of a team
in a team sport or on the score, point total, point spread or performance of an
individual athlete in a non-team sport.
(b) Does
not include wagering on sporting events that is prohibited by the national
collegiate athletic association. END_STATUTE
Sec. 3. Section
13-3302, Arizona Revised Statutes, is amended to read:
START_STATUTE13-3302. Exclusions
A. The
following conduct is not unlawful under this chapter:
1. Amusement
gambling.
2. Social
gambling.
3. Regulated
gambling if the gambling is conducted in accordance with the statutes, rules or
orders governing the gambling.
4. Gambling
that is conducted at state, county or district fairs and that complies with
section 13-3301, paragraph 1, subdivision (d).
5. Sports
betting that is conducted pursuant to title 5, chapter 10.
B. An
organization that has qualified for an exemption from taxation of income under
section 501 of the internal revenue code may conduct a raffle that is subject
to the following restrictions:
1. The
nonprofit organization shall maintain this status and no a member, director, officer, employee or agent of the nonprofit
organization may not receive any direct or indirect
pecuniary benefit other than being able to participate in the raffle on a basis
equal to all other participants.
2. The
nonprofit organization has been in existence continuously in this state for a
five-year period immediately before conducting the raffle.
3. No A person, except for a bona fide local member of the sponsoring organization, may not participate directly or
indirectly in the management, sales or operation of the raffle.
4. Paragraph
1 or 3 of this subsection does not prohibit:
(a) A
licensed general hospital, a licensed special hospital or a foundation
established to support cardiovascular medical research that is exempt from
taxation of income under section 501(c)(3) of the internal revenue code from
contracting with an outside agent who participates in the management, sales or
operation of the raffle if the proceeds of the raffle are used to fund medical
research, graduate medical education or indigent care and the raffles are
conducted no not more than three
times per calendar year. The maximum fee for an outside agent shall
not exceed fifteen percent of the net proceeds of the raffle.
(b) An
entity that is exempt from taxation of income under section 501(c)(3) of the
internal revenue code and that has at least a twenty-year history of
providing comprehensive services to prevent child abuse and to provide services
and advocacy for victims of child abuse from contracting with an outside agent
who participates in the management, sales or operation of the raffle if the
proceeds of the raffle are used to provide comprehensive services to prevent
child abuse and to provide services and advocacy for victims of child abuse and
the raffles are conducted no not more
than three times per calendar year. The maximum fee for an outside
agent shall not exceed fifteen percent of the net proceeds of the raffle.
C. A
state, county or local historical society designated by this state or a county,
city or town to conduct a raffle may conduct the raffle subject to the
following conditions:
1. A
member, director, officer, employee or agent of the historical society may not
receive any direct or indirect pecuniary benefit other than being able to
participate in the raffle on a basis equal to all other participants.
2. The
historical society must have been in existence continuously in this state for a
five-year period immediately before conducting the raffle.
3. A
person, except for a bona fide local member of the sponsoring historical
society, may not participate directly or indirectly in the management, sales or
operation of the raffle.
D. A
nonprofit organization that is a booster club, a civic club or a political club
or political organization that is formally affiliated with and recognized by a
political party in this state may conduct a raffle that is subject to the
following restrictions:
1. A
member, director, officer, employee or agent of the club or organization may
not receive any direct or indirect pecuniary benefit other than being able to
participate in the raffle on a basis equal to all other participants.
2. A
person, except for a bona fide local member of the sponsoring club or
organization, may not participate directly or indirectly in the management,
sales or operation of the raffle.
3. The
maximum annual benefit that the club or organization receives for all raffles
is ten thousand dollars $10,000.
4. The
club or organization is organized and operated exclusively for pleasure,
recreation or other nonprofit purposes and no part of the club's or
organization's net earnings inures to the personal benefit of any member,
director, officer, employee or agent of the club or organization.END_STATUTE"
Renumber to
conform
Page 45,
line 14, strike "5-112"
Line 15,
strike "title 5, chapter 11," insert "sections 5-112 and 5-1201,"
Line 20,
strike "sporting event,"
Line 22,
strike "Subject to the exceptions prescribed in title 5,
chapter 11,"
Page
45, between lines 31 and 32, insert:
"Sec. 5. Section
42-5073, Arizona Revised Statutes, is amended to read:
START_STATUTE42-5073. Amusement
classification
A. The
amusement classification is comprised of the business of operating or
conducting theaters, movies, operas, shows of any type or nature, exhibitions,
concerts, carnivals, circuses, amusement parks, menageries, fairs, races,
contests, games, the net proceeds from sports betting that is
conducted outside a tribal casino, billiard or pool parlors, bowling
alleys, public dances, dance halls, boxing and wrestling matches, skating
rinks, tennis courts, except as provided in subsection B of this section, video
games, pinball machines or sports events or any other business charging
admission or user fees for exhibition, amusement or entertainment, including
the operation or sponsorship of events by a tourism and sports authority under
title 5, chapter 8. For the purposes of this section, admission or user fees
include, but are not limited to, any revenues derived from
any form of contractual agreement for rights to or use of premium or special
seating facilities or arrangements. The amusement classification
does not include:
1. Activities
or projects of bona fide religious or educational institutions.
2. Private
or group instructional activities. For the purposes of this
paragraph, "private or group instructional activities" includes, but is not limited to, performing arts, martial arts,
gymnastics and aerobic instruction.
3. The
operation or sponsorship of events by the Arizona exposition and state fair
board or county fair commissions.
4. A
musical, dramatic or dance group or a botanical garden, museum or zoo that is
qualified as a nonprofit charitable organization under section 501(c)(3) of the
United States internal revenue code if no part of its net income inures to the
benefit of any private shareholder or individual.
5. Exhibition
events in this state sponsored, conducted or operated by a nonprofit
organization that is exempt from taxation under section 501(c)(3), 501(c)(4) or
501(c)(6) of the internal revenue code if the organization is associated with
major league baseball teams or a national touring professional golfing
association and no part of the organization's net earnings inures to the
benefit of any private shareholder or individual. This paragraph
does not apply to an organization that is owned, managed or controlled, in
whole or in part, by a major league baseball team, or its owners, officers,
employees or agents, or by a major league baseball association or professional
golfing association, or its owners, officers, employees or agents, unless the
organization conducted or operated exhibition events in this state before
January 1, 2018 that were exempt from taxation under this section.
6. Operating
or sponsoring rodeos that feature primarily farm and ranch animals in this
state and that are sponsored, conducted or operated by a nonprofit organization
that is exempt from taxation under section 501(c)(3), 501(c)(4), 501(c)(6),
501(c)(7) or 501(c)(8) of the internal revenue code if no part of the
organization's net earnings inures to the benefit of any private shareholder or
individual.
7. Sales
of admissions to intercollegiate football contests if the contests are both:
(a) Operated
by a nonprofit organization that is exempt from taxation under section
501(c)(3) of the internal revenue code and no part of the organization's net
earnings inures to the benefit of any private shareholder or individual.
(b) Not
held in a multipurpose facility that is owned or operated by the tourism and sports
authority pursuant to title 5, chapter 8.
8. Activities
and events of, or fees and assessments received by, a homeowners organization
from persons who are members of the organization or accompanied guests of
members. For the purposes of this paragraph, "homeowners
organization" means a mandatory membership organization comprised of
owners of residential property within a specified residential real estate
subdivision development or similar area and established to own property for the
benefit of its members where both of the following apply:
(a) No
part of the organization's net earnings inures to the benefit of any private
shareholder or individual.
(b) The
primary purpose of the organization is to provide for the acquisition,
construction, management, maintenance or care of organization property.
9. Activities
and events of, or fees received by, a nonprofit organization that is exempt
from taxation under section 501(c)(6) of the internal revenue code if the
organization produces, organizes or promotes cultural or civic related
festivals or events and no part of the organization's net earnings inures to
the benefit of any private shareholder or individual.
10. Arranging
an amusement activity as a service to a person's customers if that person is
not otherwise engaged in the business of operating or conducting an amusement
personally or through others. This exception does not apply to
businesses that operate or conduct amusements pursuant to customer orders and
send the billings and receive the payments associated with that activity,
including when the amusement is performed by third-party independent
contractors. For the purposes of this paragraph,
"arranging" includes billing for or collecting amusement charges from
a person's customers on behalf of the persons providing the amusement.
B. The
tax base for the amusement classification is the gross proceeds of sales or
gross income derived from the business, except that the following shall be
deducted from the tax base:
1. The
gross proceeds of sales or gross income derived from memberships, including
initiation fees, that provide for the right to use a health or fitness
establishment or a private recreational establishment, or any portion of an
establishment, including tennis and other racquet courts at that establishment,
for participatory purposes for twenty-eight days or more and fees charged
for use of the health or fitness establishment or private recreational
establishment by bona fide accompanied guests of members, except that this
paragraph does not include additional fees, other than initiation fees, charged
by a health or fitness establishment or a private recreational establishment
for purposes other than memberships that provide for the right to use a health
or fitness establishment or private recreational establishment, or any portion
of an establishment, for participatory purposes for twenty-eight days or
more and accompanied guest use fees.
2. Amounts
that are exempt under section 5-111, subsection G.
3. The
gross proceeds of sales or gross income derived from membership fees, including
initiation fees, that provide for the right to use a transient lodging
recreational establishment, including golf courses and tennis and other racquet
courts at that establishment, for participatory purposes for twenty-eight
days or more, except that this paragraph does not include additional fees,
other than initiation fees, that are charged by a transient lodging
recreational establishment for purposes other than memberships and that provide
for the right to use a transient lodging recreational establishment or any
portion of the establishment for participatory purposes for twenty-eight
days or more.
4. The
gross proceeds of sales or gross income derived from sales to persons engaged
in the business of transient lodging classified under section 42-5070, if
all of the following apply:
(a) The
persons who are engaged in the transient lodging business sell the amusement to
another person for consideration.
(b) The
consideration received by the transient lodging business is equal to or greater
than the amount to be deducted under this subsection.
(c) The
transient lodging business has provided an exemption certificate to the person
engaging in business under this section.
5. The
gross proceeds of sales or gross income derived from:
(a) Business
activity that is properly included in any other business classification under
this article and that is taxable to the person engaged in that classification,
but the gross proceeds of sales or gross income to be deducted shall not exceed
the consideration paid to the person conducting the activity.
(b) Business
activity that is arranged by the person who is subject to tax under this
section and that is not taxable to the person conducting the activity due to an
exclusion, exemption or deduction under this section or section 42-5062,
but the gross proceeds of sales or gross income to be deducted shall not exceed
the consideration paid to the person conducting the activity.
(c) Business
activity that is arranged by a person who is subject to tax under this section
and that is taxable to another person under this section who conducts the
activity, but the gross proceeds of sales or gross income to be deducted shall
not exceed the consideration paid to the person conducting the activity.
6. The
gross proceeds of sales or gross income derived from entry fees paid by
participants for events that either:
(a) Until
March 1, 2017, consist of a run, walk, swim or bicycle ride or a similar event,
or any combination of these events.
(b) Are
operated or conducted by nonprofit organizations that are exempt from taxation
under section 501(c)(3) of the internal revenue code and of which no part of
the organization's net earnings inures to the benefit of any private shareholder
or individual, if the event consists of a run, walk, swim or bicycle ride or a
similar event, or any combination of these events.
7. All
of the amounts received by an indian tribe from the gross amount of monies
received for the conduct of sports betting, and all amounts held by an indian
tribe for payment of winnings to sports betting patrons. Amounts
subject to this chapter or amounts that are subject to any municipal tax code,
or both, shall not result in a combined state, county and city tax liability
that exceeds six and seventy-five one hundredths percent of adjusted
gross receipts. The tribal gaming operator shall pay and be
responsible for payments of the tribal gaming operator's tax liability under
this paragraph. For the purposes of this paragraph, The owner,
partner, shareholders or beneficiaries of the tribal gaming operator do not
INCLUDE the members or government officials of an indian tribe. For
the purposes of this subsection, For a business that is operating sports betting
pursuant to Title 5, chapter 10, "gross income" and "gross
proceeds of sales" means the receipts remaining after deducting the monies
paid for winnings from gross receipts.
C. For
the purposes of subsection B of this section:
1. "Health
or fitness establishment" means a facility whose primary purpose is to
provide facilities, equipment, instruction or education to promote the health
and fitness of its members and at least eighty percent of the monthly gross
revenue of the facility is received through accounts of memberships and
accompanied guest use fees that provide for the right to use the facility, or
any portion of the facility, under the terms of the membership agreement for
participatory purposes for twenty-eight days or more.
2. "Private
recreational establishment" means a facility whose primary purpose is to
provide recreational facilities, such as tennis, golf and swimming, for its
members and where at least eighty percent of the monthly gross revenue of the
facility is received through accounts of memberships and accompanied guest use
fees that provide for the right to use the facility, or any portion of the
facility, for participatory purposes for twenty-eight days or more.
3. "Transient
lodging recreational establishment" means a facility whose primary purpose
is to provide facilities for transient lodging, that is subject to taxation
under this chapter and that also provides recreational facilities, such as
tennis, golf and swimming, for members for a period of twenty-eight days
or more.
D. Until
December 31, 1988, the revenues from hayrides and other animal-drawn
amusement rides, from horseback riding and riding instruction and from
recreational tours using motor vehicles designed to operate on and off public
highways are exempt from the tax imposed by this section. Beginning January 1,
1989, the gross proceeds or gross income from hayrides and other animal-drawn
amusement rides, from horseback riding and from recreational tours using motor
vehicles designed to operate on and off public highways are subject to taxation
under this section. Tax liabilities, penalties and interest paid for
taxable periods before January 1, 1989 shall not be refunded unless the
taxpayer requesting the refund provides proof satisfactory to the department
that the taxes will be returned to the customer.
E. If
a person is engaged in the business of offering both exhibition, amusement or
entertainment and private or group instructional activities, the person's books
shall be kept to show separately the gross income from exhibition, amusement or
entertainment and the gross income from instructional activities. If
the books do not provide this separate accounting, the tax is imposed on the
person's total gross income from the business.
F. The
department shall separately account for revenues collected under the amusement
classification for the purposes of section 42-5029, subsection D,
paragraph 4, subdivision (b).
G. For
the purposes of section 42-5032.01, the department shall separately
account for revenues collected under the amusement classification from sales of
admissions to:
1. Events
that are held in a multipurpose facility that is owned or operated by the
tourism and sports authority pursuant to title 5, chapter 8, including
intercollegiate football contests that are operated by a nonprofit organization
that is exempt from taxation under section 501(c)(3) of the internal revenue
code.
2. Professional
football contests that are held in a stadium located on the campus of an
institution under the jurisdiction of the Arizona board of regents.END_STATUTE"
Renumber to
conform
Page 45,
strike lines 39 through 45
Page 46,
strike lines 1 through 6
Renumber to
conform
Amend title to conform
Bill
Number: S.B. 1797