§ 27A — Keno; licenses; growth revenues; distribution

Section 27A. (a) The lottery commission is hereby authorized and directed to implement the game known as Keno. Said commission shall implement Keno on October first, nineteen hundred and ninety-three. Said commission shall implement Keno so as to either include the participation of the charitable gaming licensees who conduct beano, so called, in the operation of Keno or, if necessary, to develop a separate Keno game for use by such charitable gaming licensees exclusively. A license to operate the game known as Keno, upon the full implementation of said game, shall be available to any licensee licensed under section twenty-seven of chapter ten or under section twelve of chapter one hundred and thirty-eight; provided, however, that such licensee does not owe a financial obligation to the commonwealth and such licensee has not been convicted of a felony. A license to operate the game known as Keno shall not be issued to any person, business, corporation, or other entity, except as provided herein.[ Subsection (b) effective until July 1, 2024. For text effective July 1, 2024, see below.](b) No license to operate the game known as Keno shall be made available to any licensee licensed under section twenty-seven other than licenses granted pursuant to the provisions of this subsection; provided, however, that this subsection shall not authorize the revocation of any license granted before January first, nineteen hundred and ninety-six. A license to operate Keno shall be granted by the chairman of the commission or his designee to any licensee licensed pursuant to section twenty-seven; provided, however, that such licensee does not owe a financial obligation to the commonwealth and has not been convicted of a felony; and provided, further, that not less than twenty-one days before issuing any such license to operate Keno, said chairman of said commission or his designee shall send notification by certified mail to the mayor or the board of selectmen, whichever is applicable, of the municipality in which such facility to be licensed to operate Keno is so located and shall publish, in a newspaper of general circulation in the area including the municipality where said Keno licensee will operate, notice that an application for such license has been filed with said commission. Said notice shall include the name and business address of said Keno license applicant; the address wherein said Keno licensee will operate; the licensee's estimated weekly traffic; the licensee's current number of cashier positions that sell lottery commission products; the percentage of floor space that is currently devoted to lottery sales; the amount of revenue generated by the sale of lottery products at the site; the percentage of gross revenue directly derived from the sale of lottery products; the amount of net income that the commission estimates would be derived from the sale of Keno products at the site; and the percentage of floor space that will be devoted to Keno sales. No such license shall be issued by said chairman of said commission or his designee to which the local licensing authority, as defined pursuant to section one of chapter one hundred and thirty-eight, has objected in writing as a result of an official action of said authority, except after a hearing under chapter thirty A and unless said chairman of said commission or his designee thereafter determines in writing, after considering all relevant circumstances, that such license is in the public interest and approves in writing the issuance of such license to operate Keno, notwithstanding the objection of the local licensing authority.[ Subsection (b) as amended by 2024, 140, Sec. 13 effective July 1, 2024. See 2024, 140, Sec. 264. For text effective until July 1, 2024, see above.](b) No license to operate the game known as Keno shall be made available to any licensee licensed under section twenty-seven other than licenses granted pursuant to the provisions of this subsection; provided, however, that this subsection shall not authorize the revocation of any license granted before January first, nineteen hundred and ninety-six. A license to operate Keno shall be granted by the chairman of the commission or his designee to any licensee licensed pursuant to section twenty-seven; provided, however, that such licensee does not owe a financial obligation to the commonwealth and has not been convicted of a felony; and provided, further, that not less than twenty-one days before issuing any such license to operate Keno, said chairman of said commission or his designee shall send notification by certified mail to the mayor or the board of selectmen, whichever is applicable, of the municipality in which such facility to be licensed to operate Keno is so located and shall publish, on the commission's website, notice that an application for such license has been filed with said commission. Said notice shall include the name and business address of said Keno license applicant; the address wherein said Keno licensee will operate; the licensee's estimated weekly traffic; the licensee's current number of cashier positions that sell lottery commission products; the percentage of floor space that is currently devoted to lottery sales; the amount of revenue generated by the sale of lottery products at the site; the percentage of gross revenue directly derived from the sale of lottery products; the amount of net income that the commission estimates would be derived from the sale of Keno products at the site; and the percentage of floor space that will be devoted to Keno sales. No such license shall be issued by said chairman of said commission or his designee to which the local licensing authority, as defined pursuant to section one of chapter one hundred and thirty-eight, has objected in writing as a result of an official action of said authority, except after a hearing under chapter thirty A and unless said chairman of said commission or his designee thereafter determines in writing, after considering all relevant circumstances, that such license is in the public interest and approves in writing the issuance of such license to operate Keno, notwithstanding the objection of the local licensing authority.(c) For the purposes of this subsection, "Keno growth revenues'' shall be defined as the difference in the amount of net revenues generated by the Keno game in each fiscal year beginning on July first, nineteen hundred and ninety-six, and thereafter minus the amount of net revenues generated by the Keno game in the fiscal year beginning on July first, nineteen hundred and ninety-five, which shall be known as the base year. "Net revenues'' shall be defined as revenues less prizes, sales agent expenses, and allocated administrative expenses incurred relative to Keno operations. In the fiscal year beginning on July first, nineteen hundred and ninety-six, and in every fiscal year thereafter, said Keno growth revenues shall be distributed through the lottery aid formula to only those municipalities which have a facility for which a Keno license has been approved by said commission and to those municipalities which do not have located within it either a licensee licensed under section twenty-seven of chapter ten or a licensee licensed under section twelve of chapter one hundred and thirty-eight. If the license of a Keno licensee is revoked or suspended by the commission or voluntarily terminated by the licensee thereby causing no Keno licensee to be located in a municipality and the commission subsequently does not approve a new Keno license in that municipality, said municipality shall, as of the date of such Keno license revocation, suspension, or voluntary termination, no longer receive pursuant to the lottery aid disbursement formula or otherwise any Keno growth revenues generated by Keno licensees for whom a license has been approved by said commission; provided, however, that such municipality shall receive an amount of Keno growth revenues for that particular fiscal year that represents the proportion of the annual distribution from July first to the quarter of the fiscal year in which such license revocation, suspension, or voluntary termination occurred; provided, further, that if such a municipality without a Keno licensee due to suspension, revocation, or voluntary termination then regains a Keno licensee the lottery aid distribution under the provisions of this section for that particular fiscal year shall then include a proportion calculated starting in the quarter of the fiscal year in which the Keno licensee newly commences operations to the end of said fiscal year. After the fiscal year beginning on July first, nineteen hundred and ninety-six, if a municipality has a Keno licensee or licensees for a full fiscal year and subsequently loses such licensee or licensees thereby causing no Keno licensee to be located in such municipality, such municipality shall receive in the subsequent fiscal years in which it has no Keno licensee an amount of Keno growth revenues equal to the amount it received for the last fiscal year in which the Keno licensee was located for the full fiscal year; provided, however, that if such a municipality without a Keno licensee then regains a Keno licensee, the base year for calculating subsequent Keno growth revenues to be distributed to such a municipality shall be the last fiscal year in which a Keno licensee was located in such municipality for the full fiscal year.A municipality which would otherwise be ineligible to receive Keno growth revenues pursuant to this subsection may apply to the chairman of the commission to receive an exemption from the exclusion of receipt of such Keno growth revenues. Said chairman, upon application of a municipality and a majority vote of the commission, shall grant or deny the application for said exemption only after a public hearing. In the consideration of approving or denying said exemption for a municipality, the chairman and the commission shall consider all mitigating circumstances by which a community is ineligible to receive Keno growth revenues pursuant to this subsection including, but not limited to, the absence of petitioners seeking Keno licenses and the reasons therefor, the closure of a business which is a municipality's sole Keno licensee, the voluntary termination and surrender of a Keno license by a licensee, the suspension or revocation and subsequent surrender, for just cause, of a license of a municipality's sole Keno licensee, the denial of an application for a Keno license by said chairman or his designee when such applicant is the sole potential licensee in a municipality, the population of a municipality or other reasons which said chairman and said commission may deem appropriate pursuant to rules and regulations. The chairman of said commission shall, by November first, nineteen hundred and ninety-six, promulgate rules and regulations to implement the provisions of the exemption application process.(d) Notwithstanding the provisions of section two of chapter thirty A, no rule or regulation relating to the game known as Keno shall be promulgated by the commission as an emergency regulation, as defined by said section two of said chapter thirty A, without a public hearing.