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NH Racing and Charitable Gaming Commission Status of Pari-Mutuel and Charitable Gaming in New Hampshire September 15, 2

NH Racing and Charitable Gaming Commission Status of Pari-Mutuel and Charitable Gaming in New Hampshire September 15, 2009. 4/1/2014. NH Racing and Charitable Gaming Status of Pari-Mutuel and Charitable Gaming in NH Table of Contents. Page No

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NH Racing and Charitable Gaming Commission Status of Pari-Mutuel and Charitable Gaming in New Hampshire September 15, 2

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  1. NH Racing and Charitable Gaming Commission Status of Pari-Mutuel and Charitable Gaming in New HampshireSeptember 15, 2009 4/1/2014

  2. NH Racing and Charitable GamingStatus of Pari-Mutuel and Charitable Gaming in NH Table of Contents Page No 1) History of Gaming in New Hampshire 3 2) Gaming Regulation (Licensing and Oversight) 6 3) Sources of Agency Revenue 10 4) Distribution of Agency Revenue 14 5) Competition from other States 15 6) Illegal Gambling 16 7) Gambling Activities from out of State Residents 17 8) Five year State and Charity Revenue History 18 9) Agency Fee Schedule 19 10) Listing of Charities 26 4/1/2014 4/1/2014 2 2

  3. History of Gaming in New Hampshire • The beginning of gaming in New Hampshire dates back to 1933 when the NH legislature legalized thoroughbred and harness horse racing. Greyhound racing was legalized in 1971. • Until the year 2008, there were four race tracks (The Lodge at Belmont in Belmont, Rockingham Park in Salem, Seabrook Greyhound Park in Seabrook and Hinsdale Greyhound Racing Association in Hinsdale) licensed by the State to Conduct live and simulcast racing. State laws required the tracks to conduct a minimum number of live racing in order to conduct simulcast racing at their facilities. • Rockingham Park conducted live thoroughbred and harness racing along with simulcasting . The remaining tracks conducted live greyhound racing along with simulcasting. In addition to these tracks the State also licensed the Rochester Fair in Rochester to conduct a ten day harness race meet during the annual Rochester fair. 4/1/2014 3

  4. History of Gaming – Contd. • Due to economic pressures the Rochester Fair has not applied for a license since 2007 to conduct the annual harness meet and the Hinsdale Greyhound Racing Association filed for bankruptcy in 2008 closing the facility. • A change in the laws enacted in the last legislative session provided licensed tracks the option to conduct simulcast races without live racing. Citing economic conditions, The Lodge at Belmont and the Seabrook Greyhound Park did not conduct live racing in 2009. • Bingo games and sale of Lucky 7 (pull tab tickets) were legalized in 1949. The administration and enforcement of Bingo and Lucky 7 laws were entrusted to the Lottery Commission and the Department of Safety respectively. • On January 1, 2005 , the responsibilities of both the administration and enforcement of Bingo and Lucky 7 were transferred to the Racing and Charitable Gaming Commission. 4/1/2014 4

  5. History of Gaming - Contd. • Games of Chance (GOC) have been legal in NH since 1977. • GOC is limited to entities that are qualified as non-profit charitable organizations under the internal revenue service code 501(c) (3). The administration and enforcement were entrusted to the office of the Attorney General and the local police chiefs respectively. • In July of 2006, both the administration and enforcement of GOC was transferred to the Racing and Charitable Gaming Commission. 4/1/2014 5

  6. Gaming Regulation (Licensing and Oversight) • Regulation for racing and charitable gaming is governed by RSA’s 284 and 287 respectively and rules promulgated in accordance with RSA 541 A. • RSA 284:6 established a Racing and Charitable Gaming Commission consisting of six members appointed by the Governor and Council with each member serving a term of (3) years. • The Commission’s oversight of gaming is accomplished through its administrative office in Concord. • The administration office is headed by a director who manages a staff of (23) full time and (35) seasonal part-time employees. • The Racing and Charitable Gaming Commission has all the powers, duties, and rights under the United States Interstate Horseracing Act of 1978. 4/1/2014 6

  7. Gaming Regulation (licensing and Oversight) – Contd. • The administrative office is responsible for licensing, enforcement and audits of racetracks, charitable organizations, game operators, bingo halls and manufacturers and distributors of gaming equipment. Collection of all taxes, fines and administrative fees. • All Licensees associated with charitable gaming are subject to state police and FBI background checks before a license is issued. • Race track licensees are subject to comprehensive background checks by the Commission and the attorney general’s office when deemed appropriate by the Attorney General. • Race tracks, game operators (or game operator employers), manufacturers and distributors of gaming equipment are required by statute to post surety bonds to meet their statutory obligations. Bond amounts vary from $50,000 for manufacturers and distributors to amounts not to exceed $300,000 for race tracks and game operators. 4/1/2014 7

  8. Gaming Regulation (licensing and Oversight) – Contd. • To maintain the integrity of live racing, animals placed first in a race are subject to strict blood and urine testing to eliminate any tampering of racing animals. Animals not placed first in a race may be subject to random testing. • The State currently contracts with the University of FloridaLaboratory for testing services. The entire cost of testing is borne by the race tracks. • Gaming activities at bingo halls, facilities licensed to sell Lucky 7 tickets, GOC licensed facilities and race tracks are subject to routine inspections by the Commission’s inspectors. Five full time inspector positions are authorized. 4/1/2014 8

  9. Gaming Regulation (licensing and Oversight) – Contd. How much legal gambling did the NH Racing and Charitable Gaming Commission oversee IN 2008? Racetracks $ 224,000,000 Bingo $ 18,000,000 Lucky 7 $ 65,000,000 Games of Chance $ 45,000,000 Total $ 352,000,000

  10. Sources of Agency Revenue • The State receives revenue from the following racing activities: • Live and simulcast racing revenues (tax and breakage) are based on statutorily established percentages of total handle in racing activities. • The State also receives “outs” money (unclaimed tickets at the end of the calendar year). These monies are paid over to the State by the tracks. Typically, 20 to 25% of these monies are claimed. The remainder escheats to the general fund after being unclaimed for (11) months. • Harness and Greyhound Occupational License fees. These fees are licenses for the tracks, Tote companies, trainers, food concession employees, judges, grooms, drivers, owners etc. 4/1/2014 10

  11. Sources of Agency Revenue - Contd. • Other sources of revenue from racing activities include fines and background investigation fees. • The State is reimbursed by the tracks for veterinarian and judges salaries. • The State receives the following revenues from gambling activities: • GOC assessment fees. These fees vary depending on the type of games. Games where chips have no monetary value are assessed 3% of the total handle (Amount wagered). Games where chips have monetary value with “rake” or money collected are assessed 10% of rake amount. Games where chips have monetary value and no “rake” are assessed 10% of total handle. 4/1/2014 11

  12. Sources of Agency Revenue - Contd. • GOC license fees are charged to the charities, facilities and primary and secondary game operators. Game operators are also charged a fee for badges issued by the Commission. • Bingo tax. A 7% tax is assessed on all “winner take all” and “Bonus” games. • Charitable organizations are charged license fees for the right to conduct bingo games and sell Lucky 7(pull tab) tickets. • Commercial bingo halls are charged license fees for the right to host organizations conducting bingo and selling Lucky 7 tickets. 4/1/2014 12

  13. Sources of Agency Revenue - Contd. • Manufacturers and distributors are charged license fees for the right to manufacture and distribute gaming equipment and paraphernalia in the State. The annual license fee is $10,000 and $5,000 for manufacturers and distributors respectively. • Distributors are also assessed a $15 fee for each deal of pull tab tickets sold and $6 for each deal of bag tickets sold. (Please see attached fee schedule for a detailed list of the various fees charged by the Commission.) 4/1/2014 13

  14. Distribution of Agency Revenue • All revenue (gross) from racing activities are transferred directly to the general fund on a daily basis. Administrative expenses for racing are appropriated by the general fund. • All revenue from Bingo, lucky 7 activities net of administrative expenses are transferred monthly to the education trust fund. • All revenue from GOC assessment fees net of administrative expenses are transferred monthly to the general fund. 4/1/2014 14

  15. Competition From Other States • The primary competition for soliciting gambling dollars from NH residents comes from the States of Connecticut, Rhode Island, Maine and Massachusetts. These States are home to the Foxwoods Resort Casino, Mohegan Sun Casino (CT), Twin River and Newport Grand Slots (RI), Hollywood Slots hotel & Raceway, Scarborough Downs (ME) and Suffolk Downs and Raynham Greyhound (MA). • According to the New England Casino Gaming Update 2009 report by the Center for Policy Analysis, University of Massachusetts Dartmouth, while spending has declined from previous years, in calendar year 2008, NH residents spent approximately $66.1 million in the Connecticut casinos and an additional $602,000 in Maine contributing approximately $8.6 million and $262,000 to the Connecticut and Maine treasuries respectively. 4/1/2014 15

  16. Illegal Gambling • While we know of competition from other States, there is additional competition from illegal gambling from both within and outside the State in the form of internet gambling, sports betting, and illegal machines in clubs, also household card games (as seen in online advertisements such as Craig’s List) and other establishments. The extent of illegal gambling is unknown although it is believed to be significant. 4/1/2014 16

  17. Gambling Activities from Out of State Residents • There is no empirical data on the extent of gambling done by residents of neighboring states in New Hampshire. • A survey of the license plates in parking lots in the two race tracks on a typical weekend in the Southern tier of the state suggests that, approximately 90 % of the patrons at the track facilities are non-residents. 4/1/2014 17

  18. New Hampshire Racing and Charitable Gaming CommissionFive Year State and Charity Revenue History 4/1/2014 18

  19. Agency Fee Schedule

  20. Agency Fee Schedule

  21. Agency Fee Schedule

  22. Agency Fee Schedule

  23. Agency Fee Schedule

  24. Agency Fee Schedule

  25. Agency Fee Schedule

  26. NH Racing and Charitable GamingListing of Charities(Bingo – Lucky 7 Licenses)

  27. NH Racing and Charitable GamingListing of Charities(Bingo – Lucky 7 Licenses)

  28. NH Racing and Charitable GamingListing of Charities(Bingo – Lucky 7 Licenses)

  29. NH Racing and Charitable GamingListing of Charities(Bingo – Lucky 7 Licenses)

  30. NH Racing and Charitable GamingListing of Charities(Bingo – Lucky 7 Licenses)

  31. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  32. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  33. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  34. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  35. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  36. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  37. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

  38. NH Racing and Charitable GamingListing of Charities(Games of Chance Licenses)

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