Fowler Municipal Code Ch. 13 Gaming Clubs

For the purposes of this chapter, the words and phrases hereinafter set forth shall have the following meanings ascribed to them unless the context clearly requires otherwise:

"Applicant" shall mean any person or entity filing an application with the City seeking a gaming club license, permission to transfer pointholder interest, or a work permit.

"Beneficial interest" shall mean that interest in a gaming club held by the beneficiaries of a trust which, as part of the corpus thereof, holds a financial interest in such gaming club.

"Commence" shall mean and include the terms "commence," "begin," "initiate," "start," "open" and "establish."

"Conduct" shall mean and include the terms "conduct," "transact," "maintain," "prosecute," "practice," "manage," "operate," "permit," "allow," "suffer" and "carry on."

"Conviction" or "convicted" shall mean a plea of guilty, a final verdict of guilty or a conviction following a plea of nolo contendere.

"Day" shall mean "calendar day" unless otherwise expressly stated.

"Employee" shall mean every person who is engaged in the operation or conduct of any gaming club whether as a pointholder, member of a pointholder's family, associate, agent, manager, employee or representative and each and every other person employed or working at or for such a business for a wage, salary, commission, room, board or any other remuneration.

"Filing and processing fees" shall mean the imposition, pursuant to this chapter and/or resolution of the city council, of fees and/or deposits to be used for the purpose of reimbursing the City for its costs of administering the provisions of this chapter.

"Financial interest" means any direct or indirect interest in the management, operation, ownership, profits or revenue (gross or net) of a gaming club. A "direct financial interest" means a monetary investment in a gaming club. An "indirect financial interest" means owning one percent or more of any entity, i.e., any business, corporation, joint venture partnership or trust that in turn has a direct financial interest in a gaming club.

Game. See "legal gambling or gaming," below.

"Gaming club" shall mean any building or structure, or portion thereof, for which a license is obtained and in which legal gambling or gaming is conducted. The term shall include any restaurant, bar, assembly room, meeting room or office which is a part of or appurtenant to the room or rooms in which legal gambling or gaming is conducted. The term shall also include the business of operating the gaming club and those business enterprises which are a part thereof, i.e., restaurant, bar, etc.

"Gross revenue" means and includes seat rental fees, tournament fees, membership fees, table revenues, and any and all other gaming charges directly derived from gaming activities conducted on or within the gaming club premises. "Gross revenue" does not include revenue derived from the sale of food, beverages, sundries or from any other non-gaming activities.

"Legal gambling or gaming" shall mean any card game played for currency, check, credit or any other thing of value which is not prohibited and made unlawful by Chapter 9 (commencing with Section 319) or Chapter 10 (commencing with Section 330) of Title 9 of Part 1 of the Penal Code or by this chapter. The game of bingo is not governed by the provisions of this chapter but, rather, by the provisions of Chapter 11 of Title 5 of the Fowler Municipal Code.

"License" shall mean a license issued pursuant to this chapter allowing the operation of a gaming club.

"Licensee" shall mean the person or entity to whom (which) a license is issued.

"License fees" shall mean business license taxes and fees levied upon each licensee pursuant to this chapter.

"Manager" shall mean any agent or employee of a licensee whose duties include but may not be limited to the following: (i) the making or changing of policy; (ii) approving credit; (iii) hiring or firing employees; (iv) generally exercising independent judgment in the operation of the gaming club. A manager need not have a financial interest in the licensee.

"Playing cards" or "card games" shall mean the participation in legal gambling or gaming at a gaming club.

"Pointholder" shall mean any person or entity having a financial interest or beneficial interest in the licensee as well as all stockholders of any entity having a financial interest or beneficial interest in the licensee.

"Security deposit" shall mean any security or deposit required by this chapter to ensure the prompt and full payment of any license fees imposed by the City pursuant to this chapter.

"Work permit" shall mean a permit issued pursuant to this chapter authorizing a person to be an employee of a gaming club.

(§ 2, Ord. 92-5, eff. January 14, 1992, as amended by § 1, Ord. 93-7, eff. November 4, 1993)

(a) It is the stated purpose of this chapter to regulate gaming clubs in the City concurrently with the State of California, and to impose local controls and conditions upon gaming clubs as permitted in "The Gaming Registration Act" as codified in Division 8, Chapter 5 of the California Business and Professions Code (commencing with Section 19800). All such references in this chapter to the Gaming Registration Act are to Division 8, Chapter 5 of the California Business and Professions Code, as may be amended.

(b) The registration of any corporation, individual, partnership or other entity or person under The Gaming Registration Act does not entitle such state registrant to any license or permit under this chapter.

(§ 2, Ord. 92-5, eff. January 14, 1992)

This chapter does not create any vested or other property right of any kind in any licensee, pointholder, employee, person or entity. The City reserves the right to, at any time, terminate, change, modify or repeal the provisions of this chapter and to otherwise regulate or prohibit any privilege exercised thereunder. This reservation includes but is not limited to the right of the City to amend, from time to time, a license issued pursuant to the terms of this chapter by resolution of the City Council.

(§ 2, Ord. 92-5, eff. January 14, 1992)

It shall be unlawful for any person or entity to own or operate a gaming club without first obtaining a valid, unexpired, and unrevoked license issued pursuant to the provisions of this chapter, whether or not a fee or other charge is made to the players.

(§ 2, Ord. 92-5, eff. January 14, 1992)

(a) General.

(1) There shall be three (3) distinct stages of the license application process. An applicant shall obtain no interest in a license, either in equity or at law, unless and until such applicant has received notification that the applicant has been approved for a license and the successful applicant has timely paid the required fees. The three stages of the license application process are:

(i) Selection of primary and alternate applicant for investigation;

(ii) Site, building and security information;

(iii) Applicant approval and issuance of license.

(2) An applicant for a license may be an individual, a corporation, a joint venture, a partnership, a trust (revocable or irrevocable) or any other legal entity. A licensee shall have only a direct financial interest in the gaming club that the licensee operates.

(3) An applicant, all pointholders of the applicant holding a five (5) percent or greater interest in the licensee, and all managers of the applicant must hold a valid registration issued by the Attorney General of the State of California before a license shall become effective or operative in any manner.

(i) The applicant, each pointholder of the applicant and each manager of the applicant shall be responsible for applying for and obtaining a valid registration in conformance with the Gaming Registration Act.

(ii) Except for pointholders holding less than five (5) percent interest in the licensee, registration must occur prior to, or simultaneous with the application process. The City shall not issue any interim or temporary licenses to applicants to assist with the registration process.

(iii) With respect to pointholders holding less than five (5) percent interest in the licensee, those pointholders shall either obtain registration prior to the application process or apply simultaneously with the application process and obtain the registration within two (2) years of the date of the application to the Attorney General.

(iv) The City may, in its discretion, require submission of applications for initial registration (together with the applicable fees) to be delivered to the State Department of Justice via the Chief of Police for those applicants, pointholders, and managers which do not already hold a valid registration certificate.

(b) Selection of Primary and Alternate Applicant for Investigation.

(1) The City Council may, in its discretion, announce that applications for a license are being accepted and shall establish a date by which all applications must be received. Late or incomplete applications shall not be considered; provided, however, the City Council, in its discretion, may extend the date by which applications will be received.

(2) Each applicant shall submit an application under penalty of perjury to the City Council on a form provided by the City. Each application shall contain the following:

(i) A statement of the legal form of the applicant (e.g., partnership, corporation, etc.)

(aa) If the applicant is a corporation, a certified copy of the Articles of Incorporation, as amended, and a copy of the By-Laws, as amended;

(ab) If the applicant is other than an individual or corporation, copies of all formation documents (e.g., for a trust, copies of the Indenture of Trust);

(ii) A complete list of all pointholders with five (5) percent or greater interest in the applicant together with a statement of such pointholder's financial investment in the applicant and a statement of such pointholder's percentage ownership or beneficial interest in the applicant;

(iii) One complete copy of all registration and re-registration applications (and exhibits) filed by the applicant and all pointholders of the applicant and all proposed managers of the gaming club ("registrants"), a copy of the current Gaming Registration Certificates issued to each registrant, and a copy of all correspondence between each registrant and the Attorney General, all of which shall be declared by the registrant under penalty of perjury to be a true and complete copy thereof;

(iv) Certificates executed by each registrant authorizing and directing the Attorney General to release any and all information learned during its investigation of such registrant to the City and authorizing and directing the Attorney General, its staff and investigators to discuss with the City any and all information learned during the registration process;

(v) Financial statements of the applicant and all pointholders of the applicant;

(vi) The names, addresses, physical descriptions, birth dates, social security and driver's license numbers, criminal record and fingerprints (taken by the Chief of Police for the City) of the applicant (if a person) and all pointholders of the applicant together with two (2) full face photographs of one-inch by one-inch exact size, of each such person taken within sixty (60) days prior to the filing of the application;

(vii) A schedule of the proposed percentage of total monthly gross revenue to be paid to the City as gross revenue license fees (see Section 5-13.09(c));

(viii) The maximum number of legal gaming tables proposed to be operated within the gaming club, which shall not exceed 100 tables except for a City authorized tournament and special events;

(ix) The specific legal games to be played within the gaming club, and the rules and fee schedules for such games;

(x) Such other information as the City Council may deem necessary and appropriate.

(3) Based upon the information supplied in the application, the City Council may select a primary applicant and an alternative applicant.

(4) The primary applicant shall, within three (3) business days of selection, post with the City the filing and processing fee described in Section 5-13.09(a).

(5) Upon receipt of the filing and processing fee, the City shall investigate or cause to be investigated the primary applicant (including all pointholders and managers).

(6) If, for any reason, a pointholder with five (5%) percent or greater interest in an applicant transfers its interest in such applicant prior to the award of the license, whether or not such transfer is for value, or if such pointholder forfeits its interest in such applicant prior to the award of the license, such applicant shall immediately notify the City Administrator of such event and shall supply all information regarding such transfer or forfeiture deemed necessary and appropriate by the City Council. The City reserves the right to set a date after which no pointholders' interests may be transferred or forfeited in order for the applicant to be considered for a license.

(7) The alternative applicant will be investigated only if the primary applicant withdraws its application or is denied the license pursuant to Section 5-13.08. Within three (3) business days of receipt of notice that the primary applicant has withdrawn its application or has been denied the license, the alternative applicant will post with the City the filing and processing fee described in Section 5-13.09(a).

(c) Site, building and security information.

(1) Upon selection of the primary and alternate applicant, the City Council shall establish a date by which the primary applicant must submit, as a single package, the following information:

(i) The location of the proposed gaming club, including a specific description of the building or structure within which the gaming club is to be situated, and the specific portion of such building or structure for which the license is requested. If the entire building or structure is proposed to be used as a gaming club, the application shall so state and shall request the license for the entire building or structure. If only a portion of the building or structure is proposed to be used as a gaming club, the application shall so state, shall describe such portion and shall request a license for only such portion. If a building or structure is not yet constructed at the location of the proposed gaming club, the applicant shall provide a site plan and elevations of the building or structure to be constructed and shall describe such portion of the building or structure which is proposed to be used as a gaming club. At a minimum, each gaming club shall include the following:

(aa) A gaming room or rooms;

(ab) A restaurant;

(ac) A full service bar; and

(ad) A public meeting room;

(ii) A certificate issued by the City that the premises comply with the adopted building code. If the building or structure has not yet been constructed, such certification shall be provided before legal gambling or gaming may be conducted on the premises;

(iii) A certificate issued by the City that the premises comply with the adopted fire code. If the building or structure has not yet been constructed, such certification shall be provided before legal gambling or gaming may be conducted on the premises;

(iv) A certificate issued by the City that the premises comply with the current zoning, parking and subdivision ordinances. If the building or structure has not yet been constructed, such certification shall be provided before legal gambling or gaming may be conducted on the premises;

(v) A description of the proposed security measures of the gaming club and a copy of the current security manual, if available;

(vi) The true and complete names and addresses of the owners of the gaming club premises, and, if different, of any persons leasing or renting the premises to the applicant, and a copy of the lease or other rental agreement.

(2) If the primary applicant withdraws its application or is denied a license, the City Council shall establish a date by which the alternative applicant must submit the information set forth in subsection (c)(1) of this section.

(d) Upon completion of its investigation and upon review of all information submitted by the applicant, the City Council shall either approve, conditionally approve or deny the application in accordance with Section 5-13.08.

(Ord. 92-5 § 2, 1-14-92; Ord. 93-3 § 1, 5-14-93; Ord. 95-7 § 26, 12-7-95; Ord. 95-8 § 1, 1-4-96)

(a) All licenses granted by the City Council shall be deemed conditioned so as to require compliance with all of the terms, conditions and provisions of this Code as well as all applicable laws of the City, State, and Federal governments. By applying for a license, the applicant agrees to the condition in the license granted that the licensee shall indemnify, defend and hold harmless the City, its officers and employees, from any and all claims and actions brought against the City, its officers or employees, concerning the validity of such license. In addition to the above, the City Council may impose specific conditions upon the license which, in its discretion, it deems necessary to ensure compliance with provisions with this Code.

(b) A violation of any condition of any license is hereby deemed to be a violation of the provisions of this chapter and is deemed sufficient grounds for license revocation or suspension, imposition of fines or other action determined appropriate by the City Council. All terms and conditions specified in any license shall be enforceable as if set forth in this code.

(§ 2, Ord. 92-5, eff. January 14, 1992)

(a) Until such time as the population of the City exceeds 29,999, as determined from the last available census, only one license may be issued and outstanding at any time. After the population of the City exceeds 29,999, as determined from the last available census, the number of licenses which may be issued by the City at any time shall not exceed the largest whole number by which the population of the City is divisible by 15,000...; provided, however, no valid license shall be invalidated by a decrease in this ratio.

Example:

Population = 29,999; Number of Licenses = 1.

Population = 30,000; Number of Licenses = 2.

Population = 44,999; Number of Licenses = 2.

(b) No application for a license shall be accepted for filing when the maximum number of licenses authorized by this chapter have been issued and are in effect. There shall be no waiting lists or priorities for persons or entities desiring to file such applications.

(c) Any person or entity interested in obtaining a license at such time as one is available may file a written request with the City Clerk for written notice as to when the applications will be accepted for filing. Such written requests shall be valid and in force for a period of one year from the date of their filing, and may be refiled.

(d) Whenever the number of licenses issued and in effect is less than the number authorized by this chapter, the City Council, in its discretion, may cause to be published in a newspaper of general circulation in the City a statement that the City is accepting applications for licenses for a period of thirty (30) calendar days from the date of such publication. Applications received after this deadline will not be considered.

(§ 2, Ord. 92-5, eff. January 14, 1992)

(a) Decision of the Council. The City Council, in its discretion, shall either approve, conditionally approve, or deny an application for a license which has been accepted and processed in accordance with Section 5-13.05.

(b) Decision of the Council is final. The decision of the City Council to approve, conditionally approve or deny any application shall be final and conclusive.

(c) Grounds for denial. The City Council, in its discretion, may deny any application for any reason it deems sufficient. Further, the City Council may deny an application for a license if any of the following facts exist:

(1) If the applicant, any pointholder of the applicant, or any proposed manager of the gaming club fails to obtain and maintain a valid registration from the Attorney General of the State of California pursuant to The Gaming Registration Act;

(2) If the applicant, any pointholder of the applicant, or any proposed manager of the gaming club is under the age of twenty-one (21);

(3) If the applicant, any pointholder of the applicant, or any proposed manager of the gaming club makes a false or misleading statement required to be revealed in any application submitted pursuant to the provisions of this chapter;

(4) If the applicant, any pointholder of the applicant, or any proposed manager of the gaming club has been convicted of a crime punishable as a felony;

(5) If the applicant, any pointholder of the applicant, or any proposed manager of the gaming club has engaged in an act involving dishonesty charged or chargeable as a criminal offense relating to the acquisition of an ownership interest in a gaming club or the real property or premises in which a gaming club is situated or relating to the operation of a gaming club, or has been convicted of an offense involving dishonesty;

(6) If the applicant, any pointholder of the applicant, or any proposed manager of the gaming club has engaged in bookmaking, loan sharking or illegal gambling or has been convicted of an offense involving such activities;

(7) If the proposed business or activity is or will be operated in violation of any Federal, State or municipal law or regulation;

(8) If the applicant does not have the financial capability or business experience to operate a gaming club in a manner which would adequately protect the patrons of the gaming club and the citizens of the community;

(9) If the establishment of a gaming club in the proposed premises would violate the zoning, fire, building or other regulations of the city or other applicable law or regulations; or

(10) If the applicant, any pointholder of the applicant or any proposed manager of the gaming club has any financial or other interest in any business or organization outside the State of California which is engaged in any form of gambling or gaming.

(Ord. 92-5 § 2, 1-14-92; Ord. 93-3 § 2, 5-14-93)

(a) Filing and Processing Fee. Within three (3) business days of receipt of notice from the City that an applicant has been selected for investigation, such applicant must post with the City the sum of ten thousand dollars ($10,000.00) as deposit for the filing and processing fees. The City shall charge against the deposit its costs of investigation of the applicant, its pointholders and its proposed managers, as well as its costs of processing the application, whether or not a license is granted.

(1) The City shall notify the applicant when the amount on deposit for the filing and processing fees has dropped to two thousand five hundred dollars ($2,500.00), or less. The City shall also demand that the applicant deposit such additional sums as are deemed necessary to cover the remaining investigation and processing costs, but in no event shall that sum be less than five thousand dollars ($5,000.00). Failure of the applicant to deposit such sums within five business days shall result in immediate denial of the application.

(2) Upon completion of the investigation and processing of the application, the City shall return to the applicant the amount remaining on deposit after deducting the filing and processing fees, if any.

(b) Quarterly License Fees.

(1) Amount. The City Council hereby determines that a quarterly license fee of twenty-five thousand dollars ($25,000.00) shall be paid in advance of the quarter for which the fee is due. The City Council determines that January 1, April 1, July 1 and October 1 of each calendar year are the dates on which such payment must be made.

(2) Applications. In the case of a new application, a deposit for the first quarter in the amount of twenty-five thousand dollars ($25,000.00) shall be paid upon notice that applicant has been approved for the issuance of a license, prior to the issuance of the license, whether or not the license is issued at the beginning of a quarter.

(3) Advance Fees Not Refundable. Quarterly license fees shall become the absolute property of the City and shall not be refunded to any such applicant for any reason whatsoever. Similarly, if the license is for any reason revoked, no proration of the quarterly license fee shall occur.

(4) Credit Against Gross Revenue License Fees. The advance quarterly license fees referred to above shall be credited against the gross revenue license fees which become due and owing during the quarter for which such fee was paid. To the extent that the cumulative total of the gross revenue license fees which become due and owing for the three (3) months which make up the quarter exceed twenty-five thousand dollars ($25,000.00), such excess must be paid at the end of the month in which such excess occurred.

(c) Gross Revenue License Fees.

(1) Schedule of Fees. Except as provided in subsection (b)(4) of this section, each licensee shall pay to the City a monthly fee, based upon the total monthly gross revenue of the gaming club business so licensed, according to the schedule set forth in the license. In no event, however, shall the schedule be less than the following:

(Example: Gross Monthly Revenue = $1,000,000.00 Gross Revenue License Fee = 0.1 (830,000.00 + .125 ($1,000,000.00 - 830,000.00)

(d) Statement of Revenue. Each licensee shall file with the City before the fifteenth day of each calendar month, a statement under oath showing the true and correct amount of gross revenue derived from the gaming club business for the preceding calendar month. The statement must also state whether the licensee is claiming a credit from the quarterly license fee as provided by subsection (b)(4) of this section. Such statement shall be accompanied by the payment of the correct amount of gross revenue license fee due and owing in accordance with provisions of this chapter.

The acceptance of any gross revenue license fees by the City shall not constitute a waiver of the right of the City to audit the books of the licensee in accordance with Section 5-13.08 to determine the correctness of the figures set forth in such statement and the amount payable to the City pursuant to the provisions in this chapter.

(e) Certification. The following certification shall be attached to the monthly statement of gross revenue:

I, ___________, hereby declare under penalty of perjury that the foregoing is true and correct. Executed this _____ day of _______, 200___ in Fowler, California.

LICENSEE

___________

Managing Partner, Owner,

Director or Trustee

(f) Security Deposit.

(1) Upon notice that an applicant has been approved for the issuance of a license, such applicant shall deposit with the City, prior to the issuance of the license, the sum of twenty-five thousand dollars ($25,000.00) as a security deposit. The licensee shall deposit with the City an additional twenty-five thousand dollars ($25,000.00) on each successive anniversary date of the license until the security deposit equals two hundred fifty thousand dollars ($250,000.00). The security deposit shall serve as security to ensure payment of license fees at such time and in such amounts as required by this Code.

(2) The City shall place the security deposit in interest bearing accounts in financial institutions selected by the City Treasurer. On or before July 31st of each year, the City Treasurer shall report all interest earned on the security deposit during the preceding fiscal year to both the City Council and the licensee.

(3) Any and all interest earned on the security deposit shall become the property of the city and shall be credited to a separate account to be used by the City for charitable purposes as determined, in its sole discretion, by the City Council.

(4) If, at any time, the licensee fails to timely pay any license fee, the City will draw from the security deposit account in the amount of the fees due and owing. All such draws shall be deemed to be from principal. The City will notify the licensee with three (3) business days that it has drawn from the security deposit. The licensee shall replenish the security deposit within ten (10) calendar days of receipt of this notice so as to bring the minimum balance thereof to the level required pursuant to this chapter. A failure to replenish the security deposit account within the time permitted herein shall be sufficient grounds for suspension or revocation of the license. In addition, should the licensee fail to timely pay any license fee more than one time in any twelve (12) month period, and the license is not revoked, the City Council may, in its discretion, increase the percentages set forth in the license for determining the amount of gross revenue license fees by one-half of one percent (0.5%), for a period of up to one year from the notice that the deposit has been drawn upon, whether or not the license is suspended.

(Ord. 92-5 § 2, 1-4-92; Ord. 93-3 § 3, 5-4-93; Ord. 95-8 § 2, 1-4-96)

(a) Licenses lawfully issued under the provisions of this chapter shall be and remain valid until either abandoned, surrendered, suspended, revoked or otherwise rendered invalid pursuant to the provisions of this Code, the laws of the State of California or laws of the United States of America.

(b) In no event shall any license fee, or any portion thereof, be refunded.

(c) Within sixty (60) days of license expiration, the City may conduct, at the licensee's expense, a full and complete audit of the books, records and documents of the gaming club. After such audit has been performed, the City may return to the licensee the security deposit less the cost of the audit and less any license fees owed. If the license is revoked for violations of this chapter, conditions in the license, or state law, the City Council may rule that the acts which justify license revocation also constitute a forfeiture of the security deposit. In such case, no portion of the security deposit shall be returned to the licensee.

(d) If the security deposit is insufficient to cover any license fees owed at the time of expiration, the security deposit shall become the property of the City and the licensee shall remain liable for the payment of any deficiency and will be responsible for reimbursing the City for any and all costs, including attorney's fees, incurred to recover such sums.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 3, 1-4-96)

(a) The license issued pursuant to this chapter may not be assigned or transferred, in whole or in part, for any reason, except as provided in this chapter. Notwithstanding this limitation, a transfer of the license or application for a license, to a limited partnership or other entity capable of being licensed which consists of the same licensee and pointholders with the same percentage interests, is permissible upon notice to the City of the details of such transfer.

(b) No financial interest or beneficial interest in a gaming club or the licensee may be transferred or assigned except as provided in Section 5-13.15. Notwithstanding this limitation, a transfer to a family trust or wholly-owned subsidiary consisting of the same individuals with the same interests is permissible upon notice to the City of the details of such transfer.

(c) Financial interests in the real property and/or the premises in which the gaming club operates may be transferred and assigned, subject to the following conditions. All proposed transfers or assignments of a financial interest in the real property and/or the premises in which the gaming club operates in excess of five (5) percent must be submitted to the City Council prior to such transfer or assignment. The City Council will consider such transfers at its first meeting in January, April, July and October of each year. Thirty (30) days prior to such meeting, the licensee (even if the licensee is not the owner of such real property or premises) must submit an application to the City Council describing the proposed transfer or assignment, the parties to such transfer or assignment, the reasons for the transfer or assignment and the consideration therefor. The City Council shall consider the application and advise the licensee of its tentative decision. The licensee may choose to withdraw its application prior to the City Council's final decision. The City Council shall either approve or deny the transfer or assignment. The decision of the City Council is final.

(d) Notwithstanding subsection (c) of this section, where the owner of a financial interest in the real property and/or the premises in which the gaming club operates dies, such financial interest may pass testate or intestate without prior approval of the City Council. Within thirty (30) days after the close of such person's estate, the licensee shall notify the City of the final disposition of such property or interest therein.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 4, 1-4-96)

(a) Licenses are subject to suspension or revocation as provided in this chapter. Licenses are also subject to revocation upon a determination by the City Council that grounds exist which would justify the denial of an application for such license if such application were then pending, or that the licensee or any pointholder of the licensee has:

(1) Violated any Federal, State or local statute, rule, regulation or ordinance relating to the operation of the gaming club or relating to gambling;

(2) Violated one or more condition of the registration issued pursuant to The Gaming Registration Act;

(3) Violated one or more of the provisions of this chapter;

(4) Violated one or more condition of the license;

(5) Committed any act which would constitute grounds for denial of a license as set forth in Section 5-13.08(d);

(6) Engaged in false or misleading advertising in connection with gambling;

(7) Failed to take reasonable steps to prevent any dishonest acts or illegal activities occurring on the gaming club premises conducted by any patron or any other person;

(8) Failed to pay any monetary penalty levied pursuant to the Gaming Registration Act or this Code;

(9) Denied the Attorney General, the City or any law enforcement agency with jurisdiction in the City access to any place within the gaming club premises or failed to promptly produce for inspection or audit any book, record or document requested by the Attorney General, the City or any law enforcement agency with jurisdiction in the City;

(10) Obtained a license by fraud, misrepresentation, concealment or through inadvertence or mistake;

(11) Made a misrepresentation, or failed to disclose, a material fact to the Attorney General under the Gaming Registration Act or to the City pursuant to this chapter.

(b) In making the determination whether to revoke or suspend a license or to apply other appropriate penalties, the City Council may consider, but is not limited to the following factors:

(1) The nature and severity of the violations, including the nature of the conduct involved in the violations;

(2) The extent to which the grounds for revoking or suspending the license have been remedied, including the timeliness of such remedial action, and the duration of the conduct giving rise to the violations;

(3) The number of instances of violations involved, and whether or not the violations are part of a pattern of violations;

(4) Whether the violations were deliberate or inadvertent;

(5) The degree, financial or physical, of injury to any victim which was proximately caused by the violation;

(6) The motivation of the person(s) who created the violations;

(7) Restitution provided to any victim; and

(8) Restitution provided to the City for the costs of enforcement or prosecution of any violations or injuries.

(c) In addition to the power of the City to revoke the license, the City Council may, in its discretion, suspend a license for a period not more than sixty (60) days where any of the conditions set forth in Section 5-13.12(a), exists.

(d) The City Council, in its discretion, or in response to a complaint, may initiate an investigation of the gaming club, or the licensee. Subpoenas may be issued for the appearance of witnesses and the production of documents and other evidence relevant to such investigation. If a licensee or pointholder of the licensee, or a manager of the licensee does not respond to a subpoena served upon and directed to such person for a personal appearance or the production of documents, prima facie grounds shall exist for the suspension or revocation of the gaming club license. The results of the investigation shall be considered by the City Council to determine whether suspension or revocation of the license is warranted.

(e) Upon a determination that conditions exist which justify the suspension or revocation of a license, the City Council, in its discretion, may:

(1) Immediately suspend the license by providing written notice to the licensee of such suspension either by personal delivery or by certified mail, return receipt requested, addressed to the licensee at the address listed in the license application, or any more recent address furnished to the City by the licensee. The written notice shall specify the action taken, the reason therefor and the time and date of a hearing on such matter. The hearing on this matter shall not occur earlier than three (3) nor later than five (5) business days of the notice of suspension. The hearing shall be informal in nature, allowing first the City and then the licensee to present their versions of the facts. There shall be no right to cross-examine witnesses. The hearing shall be heard before the City Council or its designee (the "Hearing Officer") who shall have the authority to lift the suspension or to continue the suspension for a period not to exceed sixty (60) days. Such decision shall be final and conclusive. In addition to the above, the Hearing Officer may set a hearing before the City Council the issue of whether or not revocation of the license is warranted. Such revocation hearing shall be pursuant to the procedures provided in subsection (f) of this section;

(2) Provide the licensee with written notice of the determination that conditions exist which justify the revocation of the license either by personal delivery or by certified mail, return receipt requested, addressed to the licensee at the address listed in the license application, or any more recent address furnished to the City by the licensee. The written notice shall indicate the reasons for such determination and shall specify the time and date at which the City Council will receive evidence and consider taking action on such matter, which time and date shall be at least ten (10) days after the notification. Such revocation hearing shall be pursuant to the procedures provided in subsection (f) of this section.

(f) The decision to revoke a license may be made only by the City Council. Such decision will be made after providing the licensee with a full and fair public hearing, noticed in accordance with the provisions of subsection (e) of this section. The decision to revoke the license is discretionary in the City Council and its decision shall be final and conclusive.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 5, 1-4-96)

(a) The City Council, in its discretion, may, in addition to or in lieu of a suspension or revocation of a license, levy a fine or penalty against the licensee upon a determination that the licensee, pointholder, manager, or employee of the licensee has committed any act as set forth in Section 5-13.12 which justifies suspension or revocation of a license.

(b) In addition to the levy of a fine or penalty, where a pointholder of the licensee has committed any act set forth in Section 5-13.12, the City Council may order the licensee and its remaining pointholders to acquire all of that pointholder's interest in the licensee. The failure of the licensee or the remaining pointholders to acquire that pointholder's interest in the licensee within sixty (60) days shall result in the immediate suspension of the license and be grounds for revocation. The licensee must file a report with the City Council within five (5) days of a transfer of the pointholder's interest in the licensee pursuant to this section which sets forth the names of the pointholders which acquired the interest and a description of the interest each such pointholder acquired.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 6, 1-4-96)

(a) Except as provided in subdivision (b) of this section, a license shall be deemed to be abandoned and null and void if the operation of the gaming club has not commenced within one year after the issuance of the gaming club license, provided:

(1) The licensee must act with reasonable diligence toward operation of the gaming club; and

(2) Each ninety (90) day period following issuance of the license, the licensee must submit a written report to the City Council describing what steps have been taken during that period toward commencing gaming club operations; or

(3) The gaming club has failed to conduct legal gambling or gaming for a period of thirty (30) continuous days, regardless of the reasons therefor unless such failure is the result of a suspension of the license; provided, however, the licensee may, during the thirty (30) days period, request the City Council to extend the time for an additional sixty (60) days.

(b) A license shall not be deemed to be abandoned and null and void if the conditions described in subsection (a) of this section are caused by events beyond the control of the licensee or any pointholder, agent, employee, representative, or contractor of the licensee (for example, where the conditions are caused by earthquakes, floods, fire, or government-mandated shutdowns); provided, however, that the licensee makes reasonable efforts, and takes reasonable steps, to commence or reopen operation of the gaming club.

(c) If the City Council determines that a gaming club license has been abandoned pursuant to this section, it shall provide written notice to the licensee of such fact either by personal delivery or by certified mail, return receipt requested, addressed to the licensee at the address listed in the license application, or any more recent address furnished to the City by the licensee. The notice shall state that the City Council has determined that the license has been abandoned and is null and void; and the reasons for such determination. The notice shall also provide that the licensee may, within three (3) business days of the notice, pay an appeals fee, as may be established by resolution, and file with the City Clerk a written notice of appeal. The appeal shall be conducted in accordance with Section 5-13.12(f). Failure to file a written notice of appeal within three (3) business days of the notice shall render the termination of the license final and conclusive.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 7, 1-4-96)

(a) It is unlawful for any pointholder to sell, transfer or assign its interest (or any portion thereof) in the licensee, whether or not such transfer or assignment is for value, except as provided by this chapter.

(b) Pointholders desiring to sell, transfer or assign its interest (or any portion thereof) in the licensee, shall file with the City Council a written application for permission to transfer such interest on a form provided by the City. Each application shall set forth the following information:

(1) A copy of the license issued by the City;

(2) The name, address and birth date of the applicant;

(3) The name, address, physical description, birth date, social security and driver's license numbers, criminal record and fingerprints (taken by the Chief of Police of the City) of the proposed transferee (if a person) together with two (2) full face photographs of one-inch by one-inch exact size of such person taken within sixty (60) days prior to the filing of the application. If the proposed transferee is not a person, then the legal status of such transferee must be identified (e.g., corporation, partnership, trust, etc.) and the foregoing information must be provided for all shareholders, principals, trustees and trust beneficiaries of such transferee;

(4) A description of the interest sought to be sold, transferred or assigned together with a statement of whether such sale, transfer or assignment completely divests the applicant of any and all interest in the licensee;

(5) The consideration for such sale, transfer or assignment;

(6) A complete copy of all registration and reregistration applications (and exhibits) filed by the proposed transferee, a copy of the current gaming registration certificates issued to the proposed transferee, and a copy of all correspondence between the Attorney General and the proposed transferee, all of which shall be declared by the proposed transferee under penalty of perjury to be a true and complete copy thereof;

(7) A certificate executed by the proposed transferee authorizing and directing the Attorney General to release any and all information learned during its investigation of the proposed transferee to the City and authorizing and directing the Attorney General, its staff and investigators to discuss with the City any and all information learned during the registration process;

(8) A full financial statement of the proposed transferee;

(9) Such other information as the City Council may deem necessary and appropriate.

(c) Filing and Processing Fee. Each applicant must post with the City the sum of one thousand dollars ($1,000.00) as deposit for the filing and processing fees. Such deposit shall be made at the time the application is filed. The City shall charge against the deposit its costs of investigation of the proposed transferee, as well as its costs of processing the application, whether or not approval is granted.

(1) The City shall notify the applicant when the filing and processing fees reach one thousand dollars ($1,000.00). It shall also demand that the applicant deposit such additional sums as are deemed necessary to cover the remaining investigation and processing costs. Failure of the applicant to deposit such sums within five (5) business days shall result in immediate denial of the application.

(2) Upon completion of the investigation and processing of the application, the City shall return to the applicant the amount remaining on deposit after deducting the filing and processing fees, if any.

(d) The City Council shall investigate the proposed transferee.

(e) The City Council will consider such transfer applications at its first meeting in January, April, July and October of each year. Applications must be submitted to the City Council for investigation not later than sixty (60) days prior to such meeting.

(f) The City Council shall deny a transfer application if any of the following facts exist:

(1) If the proposed transferee does not have a valid registration from the Attorney General of the State of California, unless the transfer application is approved conditioned upon issuance of a valid registration from the Attorney General of the State of California;

(2) If the proposed transferee or any shareholders, partners, trustees or trust beneficiaries of the transferee have committed any act which would constitute grounds for denial of a license as set forth in Section 5-13.08(c);

(3) If the proposed transferee or any shareholders, partners, trustees or trust beneficiaries of the transferee have committed any act which would constitute grounds for suspension or revocation of a license as set forth in Section 5-13.12(a).

(g) If a transfer application is approved, no portion of the security deposit shall be returned to the transferor unless and until the transferee replaces such amounts with its own funds.

(h) The decision of the City Council to approve or deny any transfer application shall be final and conclusive.

(i) All transfer applications shall be confidential and shall not be made available for public inspection unless otherwise required by law.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 §§ 8, 9, 10, 1-4-96)

(a) Upon the death of any pointholder, the pointholder's interest in the licensee will be transferred or the license shall be deemed abandoned in accordance with subsection (b) of this section.

(b) The pointholder's estate may do any or all of the following acts in an attempt to transfer a pointholder's interest in the licensee:

(1) The pointholder's estate may file an application on behalf of the deceased pointholder for approval of the transfer of such interest to one or more of the pointholder's heirs (the proposed transferee(s)). Such application shall be filed and reviewed in accordance with Section 5-13.15.

(2) If the application is denied, or if the pointholder's will so directs, or if the executor of the pointholder's estate elects, the pointholder's estate may offer to sell, transfer or assign such interest to any surviving pointholder(s). The prior approval of the City Council is not required for such transfer. However the licensee must notify the City within thirty (30) days of such transfer, what interest was transferred, the name of the pointholder(s) acquiring such interest and the consideration therefor.

(3) If the City denies the application filed by the pointholder's estate to approve a transfer to one or more of the pointholder's heirs, or if the pointholder's estate and the surviving pointholder(s) are unable to reach an agreement as to the disposition of the pointholder's interest in the licensee within one year of the pointholder's death, the license shall be deemed abandoned.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 11, 1-4-96)

Any person wishing to work in a gaming club, in any capacity whatsoever, shall first obtain a work permit from the City. No gaming club shall employ or continue to employ, in any capacity, any person not having a valid work permit issued by the City pursuant to this chapter. No pointholder of a gaming club shall work in such gaming club, in any capacity, whether or not a salary or wage is paid, without having a valid work permit issued by the City.

(Ord. 92-5 § 2, 1-14-92)

(a) Any person wishing to obtain a work permit shall file an application with the City Council or its designee on a form provided by the City Council. The application shall, at a minimum, request the complete name, address, physical description, birth date, social security and driver's license numbers, and past criminal record of the applicant. The application shall be complete in all respects. The applicant must submit with his/her application:

(1) Two (2) full face photographs taken within the six (6) months of application;

(2) A complete set of fingerprints taken by the Chief of Police or his designee;

(3) A written statement directed from a licensee indicating a willingness and intent to employ the applicant if the latter is issued a work permit;

(4) A complete copy of the registration (if any) and exhibits of such applicant filed by the applicant under the Gaming Registration Act and a copy of the current gaming registration certificate issued to the applicant thereunder (if any); and

(5) Payment of the applicable filing and processing fee, as set from time to time by the City Council by resolution.

(b) The applicant must promptly supply such other information as may be requested by the City Council or its designee.

(c) The applicant shall pay a filing and processing fee in the amount of one hundred fifty dollars ($150.00) to cover the costs of processing the application and investigating the applicant. The Chief of Police may, in his/her discretion charge a lesser fee of forty dollars ($40.00) upon a determination that: (1) the applicant will not be involved in any gaming activities at the gaming club; and (2) an initial investigation of the applicant reveals that a complete investigation is not necessary. However, should any information subsequently come to the attention of the Police Chief which the Police Chief determines requires a further investigation of the applicant, the Police Chief shall require that the applicant pay the additional one hundred ten dollars ($110.00) filing and processing fee. A failure to pay the required filing and processing fee shall be grounds for denial, suspension, or revocation of the work permit.

(Ord. 92-5 § 2, 1-14-92; Ord. 93-7 § 2, 11-4-93; Ord. 95-8 § 2, 1-4-96; Ord. 96-2 § 1, 8-1-96)

(a) The City Council or its designee shall either grant or deny the application within thirty (30) days of the filing of the application. Such decision shall be final and conclusive.

(b) The City Council or its designee may deny the application for a work permit if it makes any of the following determinations:

(1) The applicant has failed to comply with one or more of the provisions of this chapter, or of this Code, or other laws or regulations applicable to the operation of a gaming club;

(2) The applicant has been convicted in a court of competent jurisdiction of a felony or an offense involving dishonesty or moral turpitude or has engaged in conduct constituting such offense;

(3) The applicant has engaged in bookmaking or other illegal gambling activities or has been convicted of an offense involving such activity; or

(4) The applicant has knowingly made one or more false statements in the application.

(Ord. 92-5 § 2, 1-14-92)

A work permit shall be valid for a period of two (2) years of the date of issuance. It shall be renewable at the end of each second year upon the filing of an application for renewal on a form provided by the City and the payment of a renewal fee in an amount established by resolution of the City Council. If a renewal application has not been received by the City within thirty (30) days after the expiration date of the permit, the applicant must comply with procedure set forth in Section 5-13.18 of this chapter.

(Ord. 92-5 § 2, 1-14-92)

A work permit may not be transferred or assigned.

(Ord. 92-5 § 2, 1-14-92)

(a) Work permits are subject to revocation or suspension upon a determination by the City Council or its designee that grounds exist which would justify the denial of an application for such work permit if such application were then pending. (See Section 5-13.19.)

(b) Upon a determination that conditions exist which justify the suspension or revocation of a work permit, the City Council or its designee, in its discretion, may immediately suspend the work permit by providing written notice to the permittee of such suspension either by personal delivery or by certified mail, return receipt requested, addressed to the permittee at the address listed in the work permit application, or any more recent address furnished to the City by the permittee. The written notice shall specify the action taken, the reason therefor and the time and date of a hearing on such matter. The hearing on this matter shall not occur earlier than three (3) nor later than five (5) business days of the notice of suspension. The hearing shall be informal in nature, allowing first the City and then the permittee to present their versions of the facts. There shall be no right to cross-examine witnesses. The hearing shall be heard before the City Council or its designee who shall have the authority to lift the suspension, to continue the suspension for a period not to exceed sixty (60) days or to revoke the work permit. Such decision shall be final and conclusive.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 13, 1-14-96)

Each person performing the functions for which a work permit is required shall keep in his/her immediate possession the valid work permit issued. With the exception of security personnel approved in advance by the Chief of Police for performing surveillance functions, all persons performing functions for which a work permit is required shall wear such permit as identification in a conspicuous place attached to the clothing. No work permit shall be worn off gaming club premises.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 14, 1-4-96)

No gaming club may be operated on property or within premises other than those approved during the licensing process. Any attempt to change the location of any gaming club shall result in the immediate revocation of the license unless such change in location is approved by the City Council.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 15, 1-4-96)

(a) Rules and Regulations. Rules and regulations relating to the conduct of gaming clubs may be established and promulgated by resolution adopted by the City Council. Such rules and regulations shall have the force of law, and any violation thereof shall be considered a violation of this chapter, and a ground for suspension and/or revocation of a license, permit or approval. In no case shall any game be played in a gaming club unless: (1) the game may legally be played within the State of California; and (2) the game has been approved by the City Council by either license approval and/or resolution.

(b) Exclusion of Persons.

(1) The licensee and any manager of the licensee shall exclude or eject from the premises any person whom the licensee or manager knows, or should reasonably know, has engaged in or been convicted of bookmaking, loan sharking, the sale of controlled substances, illegal gambling activities, or whose presence in or about such gaming club would be inimical to the interests of legal gambling or gaming. No person shall be excluded or ejected on the grounds of race, color, creed or sex.

(2) Any person excluded or ejected from a gaming club by the licensee or manager may appeal to the City Council or its designee as to whether the conditions set forth in subsection (b)(1) of this section are applicable. The request for an appeal shall be accompanied with the payment of a filing and processing fee in an amount established by resolution of the City Council. The City Council or its designee shall appoint a hearing officer who shall conduct a hearing at which time both the person excluded and the licensee may present evidence. The hearing shall be held within thirty (30) days of the filing of the appeal. The hearing shall be informal in nature and neither party shall have the right to cross-examine witnesses. The decision of the hearing officer shall be final and conclusive.

(3) If the hearing officer determines that the conditions set forth in subsection (b)(1) of this section do not apply to the appellant, the City shall notify all gaming clubs licensed by the City of such determination. If the hearing officer determines that the exclusion or ejection was proper, the City Council, at its next regularly scheduled meeting shall make an order to this effect.

Such order shall be subject to review by any court of competent jurisdiction in accordance with law.

(c) Hours of Operation. Hours of operation may be imposed by the City Council by resolution should it determine that such regulation is necessary for the protection of the public welfare.

(d) Age Limitations. No person under the age of twenty-one (21) years of age shall be permitted to enter into any gaming area of the gaming club. This limitation shall not be interpreted to restrict persons of any age from patronizing the restaurant and banquet facilities.

(e) Tournaments. In accordance with the provisions set forth in the license, the licensee may conduct tournaments or special events within the gaming club. During such tournaments or special events, the licensee may place additional tables within the gaming club. However, the number of such tables shall be established in accordance with the provisions set forth in the license, and, in no case, shall the number of persons allowed in the gaming club during such tournaments or special events exceed the capacity of the gaming room(s), as determined by the applicable building and fire codes.

(f) Physical Arrangements.

(1) No establishment licensed as a gaming club shall operate or maintain in use more than the maximum number of tables allowed by the license.

(2) Except during authorized tournaments, games shall be located and conducted on what is commonly known as the street floor of the gaming club premises.

(3) Except during authorized tournaments, games shall be located in one or more rooms and so arranged that the gaming tables in a room and the players at the tables shall be visible from the main doorway into such room. No wall, partition, screen, or similar structure between any main doorway into such a room and any gaming table shall be permitted if it interferes with such visibility.

(4) During all hours of operation, the main doors into the gaming room must be unlocked and accessible to the general public from outside the building.

(5) The licensee shall not conduct any bingo game on the gaming club premises. The licensee may, however, allow other persons or entities to conduct bingo games within meeting or assembly rooms of the gaming club premises, provided that such persons or entities comply with the provisions of Chapter 11 of Title 5 of this Code.

(6) The gaming areas of the gaming club shall be separated from other activities on the premises.

(7) The public entities (and the officers and employees thereof) which are charged with the responsibility of law enforcement and which have jurisdiction within the City shall have full and complete access to any and all parts of the gaming club premises during all hours of operation.

(g) Operations Procedures. No licensee, agent or employee of a license, or a person to whom a work permit has been issued shall:

(1) Allow or permit money to be used as ante or bet in any legal game in the gaming club. Anteing or betting shall be done by using tokens, chips, or other representatives of money;

(2) Loan money or permit money to be loaned, with or without security, to any person as a stake in any game;

(3) Act in the capacity of, or employ any person to act in the capacity of a house player, unless such person wears in a conspicuous place attached to the clothing, a work permit which identifies such person as a house player;

(4) Permit any person who is known to be, or reasonably appears to be, in a state of intoxication in any area of the premises;

(5) Permit any person under the age of twenty-one (21) to enter into any gaming area of the gaming club. This limitation shall not be interpreted to restrict persons of any age from patronizing the restaurant and banquet facilities;

(6) Fail, neglect or refuse to exhibit their licenses or work permits on demand of any law enforcement officer, or, in the case of a work permittee, fail, neglect or refuse to wear such permit as identification in a conspicuous place attached to his/her clothing while performing his/her duties for the licensee, if so required.

(h) General Requirements.

(1) There shall be posted in a conspicuous place in the gaming club premises the following:

(i) The minimum buy-in, time charged, or other fee charged players for the use of the tables;

(ii) A set of detailed house rules applicable to the games played, which shall be posted in the form of a printed rule book;

(iii) A copy of the current valid license and the licensee's current gaming registration certificate issued under the Gaming Registration Act.

(2) The operation of the gaming club shall be the responsibility of the licensee personally (if an individual or partnership is the licensee), the personal responsibility of the officers and directors of the licensee (if the corporation is the licensee). The operation of the gaming club shall also be the personal responsibility of any and all managers of the licensee that are present during gaming club operations. Nothing in this subsection is intended to be construed as changing the legal nature of the business entity or imposing individual financial responsibility above that which exists for the entity.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 16, 1-4-96)

(a) Alcoholic beverages may be sold, dispensed, consumed, or permitted in licensed gaming clubs in accordance with applicable State and local laws and regulations and only after the gaming club obtains a conditional use permit from the City.

(b) No on-duty employee of a gaming club shall consume alcoholic beverages.

(c) No complimentary or reduced price alcoholic beverages shall be offered by the gaming club on the gaming floor or in violation of state law.

(d) No licensee or other person in charge or control of any card game at a gaming club shall permit any person to play in any game licensed by the provisions of this chapter at any time while such person appears to be, or is, in the opinion of the licensee or duly authorized agent or employees, under the influence of an alcoholic beverage or controlled substance.

(e) No licensee or other person in charge or control of any card game at a gaming club shall permit any person to enter the premises while such person appears to be, or is, in the opinion of the licensee or duly authorized agents or employees, under the influence of an alcoholic beverage or controlled substance.

(f) Any violation of this section shall be grounds for the immediate suspension and/or revocation of any license and/or permit issued pursuant to the provisions of this Code.

(Ord. 92-5 § 2, 1-14-92; Ord. 95-8 § 17, 1-4-96)

(a) It shall be unlawful for any person as a player or dealer to deal, draw, distribute, or burn any playing card other than the top card of a deck. The "top card" is defined as the uppermost face-down card of the face-down deck.

(b) It shall be unlawful for any person as a player, dealer, employee, or agent to shuffle or cause to be shuffled any playing cards which are to be used or are being used in a gaming club card game, other than in a random manner. It shall be unlawful to predetermine, or prearrange the sequence of playing cards by value or suit, or to retain or hold back a card or cards either individually, or as a group or slug, in an effort to circumvent a random mixing of the playing cards.

(c) It shall be unlawful for any player or dealer to palm, hold out, or conceal any card during a card game, whether by sleight of hand, mechanical apparatus, or by clothing. It shall also be unlawful for any person, player, or dealer to switch, exchange, or cause to be exchanged any playing card, or cards, as a means of deception.

(d) It shall be unlawful for any person to use any technique in a card game designed to nullify a cut once performed by a player, or to influence or indicate to another person to cut the deck at a specific location.

(e) It shall be unlawful for any person, player, or dealer to deliberately mark or alter any card or cards when there is a likelihood that such cards will be used in gaming club card games or when such cards are in play. It shall be unlawful to knowingly use any altered or marked cards in a card game.

(f) The use of any mechanical or electrical apparatus or other device so as to gain any advantage or to gain information which would enable a player or dealer to deceive others shall be prohibited.

(g) It shall be unlawful for any person to knowingly aid or abet another in any cheating action.

(h) It shall be unlawful for any person to use any cheating techniques, whether or not such techniques are successful. The licensee or management shall immediately notify the Fowler Police Department upon the detection of any person suspected of cheating.

(i) It shall be the responsibility of the licensee, management, and their employees to fully cooperate with all law enforcement personnel in the detection, apprehension, and/or identification of those persons involved in cheating or fraudulent accounting practices. The management shall retain and deliver to the appropriate law enforcement agency, as evidence, all playing cards and implements suspected of involvement in cheating.

(j) The licensee shall cause this section to be reproduced and posted in the gaming club. Such posting shall be in a location where it is easily readable by anyone. Such posting shall be of readable print and enclosed within a frame or as a sign either laminated or protected by glass or a plexiglass covering.

(k) Notwithstanding other provisions of law, any person committing an unlawful act as set forth in this section, shall be guilty of a misdemeanor punishable by imprisonment not to exceed six (6) months and/or by a fine not to exceed five hundred dollars ($500.00).

(Ord. 92-5 § 2, 1-14-92)

(a) The licensee shall keep and maintain all gaming club books, documents, records and accounts (whether recorded in printed form or as electronic media) in accordance with recognized business accounting principles. Such books, documents, records and files must be retained for a period of at least seven (7) years and must be made available for inspection or audit at the demand of the City. Any and all video or audio tape recordings made for security or other purposes shall be marked with the date and time made and shall be kept in an unaltered state, for a period of fourteen (14) days, or for a longer period when so directed in writing by the City, and must be made available to any law enforcement agency for duplication upon demand.

(b) The licensee shall provide to the City Administrator a daily record of gross revenue. Such records shall be in a form acceptable to the City Administrator.

(c) The books, documents, records and accounts relating to the gross revenues of the licensee shall be audited at the end of the licensee's fiscal year by a certified public accountant. The report of such accountant and all work papers utilized in the preparation of such audit shall be submitted to the City Administrator. The City Administrator shall review the report and work papers and may require any further information from the licensee. The City Administrator may submit such documents and information to a certified public accountant selected by the City Council for review.

(d) The City Council may require, at any time, an audit of the gross revenues of the Licensee by a certified public accountant. Such audit shall be in addition to the audit required by subsection (b) of this section. Any inaccuracy found in the revenues previously reported to the City shall be adjusted accordingly. If such additional audit shall disclose an inaccuracy of greater than two (2) percent error with respect to the gross revenues reported by the licensee for the period of the audit, the cost thereof shall be paid to the City by the licensee. Otherwise, the cost of the audit shall be borne by the City.

(e) Nothing in this section shall limit the City's right to inspect or audit the books, documents, records and accounts of the licensee, at any time, relating to items other than gross revenues.

(f) Any information obtained pursuant to the provisions of this section or any statement filed by the licensee shall be deemed confidential and shall not be subject to public inspection except in connection with the enforcement of the provisions of this Code or as may be required to comply with the Public Records Act. It shall be the duty of the City Administrator to so preserve and keep such statements so that the contents thereof shall not become known except to persons charged by law with the administration of the provisions of this Code or pursuant to the order of any court of competent jurisdiction.

(g) Refusal to Display Records. Any failure or refusal of any licensee to make and file any statement as required by this Code within the prescribed time or to permit the City to inspect such books, documents, record and accounts of the licensee as requested by the City shall be full and sufficient grounds for suspension or revocation of the license.

(Ord. 92-5 § 2, 1-14-92; Ord. 93-7 § 3, 11-4-93; Ord. 95-8 § 18, 1-4-96)

The licensee shall report to the City Council all loans received by it within ten (10) days of execution of final loan documents. The information shall include the name and address of the lender and the amount and terms of the loan. In no case, however, shall such loan be secured by the gaming club unless and until the lender has been approved as a pointholder in accordance with the provisions of this chapter.

(Ord. 92-5 § 2, 1-14-92)

The provisions of this chapter providing for the payment of license fees, and the provisions of this chapter allowing the licensing of legal gambling and gaming with the City, shall not be severable one from the other. Should the requirements of this chapter relating to the payment of license fees, as set forth in this chapter or as subsequently amended, be held to be invalid or unenforceable for any reason by the final judgment of a court of competent jurisdiction, then this chapter in its entirety shall thereupon become null and void, and the license issued pursuant to this chapter shall likewise become null and void, and playing cards or games within the City shall thereupon become unlawful to the same extent as such activity was unlawful prior to the adoption of the ordinance codified in this chapter.

(Ord. 92-5 § 2, 1-14-92)

Should the gaming club license applicant approved for consideration pursuant to the provisions of this chapter not open for operation on or before December 1, 1995, through no fault of the City, the gaming club applicant shall pay a monthly application maintenance fee of twenty-five thousand dollars ($25,000.00) until the gaming club is open for operation. The maintenance fee shall be payable on or before the last day of the month for which the fee is incurred. Such maintenance fee shall be credited against any revenue generated for the City in accordance with Section 5-13.09 for the month in which the maintenance fee is incurred.

(Ord. 95-8 § 19, 1-4-96)

Notwithstanding anything to the contrary in this chapter, the following additional and supplemental provisions shall apply to gaming clubs:

(a) Retention of First Advance Quarterly License Fee. The first advance quarterly license fee of twenty-five thousand dollars ($25,000.00), payable to the City in accordance with Section 5-13.09(b) of this chapter, shall not be credited against gross revenue license fees which become due and owing during the quarter for which such fees were to be paid. The first advance quarterly license fee shall instead be in addition to the monthly gross revenue license fees due and owing under Section 5-13.09(c) of this chapter.

(b) No Credit for One Year of Second Through Fifth Advance Quarterly License Fees. The second, third, fourth and fifth advance quarterly license fees of twenty-five thousand dollars ($25,000.00) each, payable to City in accordance with Section 5-13.09(b) of this chapter, shall not be credited against gross revenue license fees which become due and owing during the quarter for which such fees were paid until one year shall have elapsed after the due date for each advance quarterly license fee, or date of receipt of such fee, whichever is later. For example, credit for the second advance quarterly license fee shall not occur until one year has elapsed after the due date of such fee, or date of receipt of such fee.

(c) City Use of Up to Fifty Thousand Dollars of Security Deposit for Five Years—Licensee Responsibility for Lost Interest. City shall have the right to use up to fifty thousand dollars ($50,000.00) of any deposits retained by City as security pursuant to Section 5-13.09(f) of this chapter. The city shall have sole discretion on how to use any such money and may use the money for any general fund purpose. The City shall replenish any money it uses from the security deposit within five (5) years of the date the license is issued pursuant to this chapter. The City shall not be responsible to repay any lost interest from use of the money and shall only be responsible to replenish the principal it uses. If the City uses money from the security deposit, the licensee shall prepay lost interest in the amount of two thousand five hundred dollars ($2,500.00) for one year, which interest shall become the property of the City and be used for charitable purposes as set forth in Section 5-13.09(f)(3) of this chapter.

(d) Right to Review Amount of Fees on a Quarterly Basis, or Earlier Basis. The City retains the absolute right, after a license is issued pursuant to this chapter, to review on a quarterly basis, or at an earlier time as the City Council deems appropriate, the amount of fees the City is receiving from the licensee to determine if such fees are sufficient to pay for the City's services necessitated by the gaming club operations, including the costs of City personnel.

(Ord. 95-9 § 1, 2-2-96)