BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 1753
                                                                  Page  1

          Date of Hearing:   April 21, 2010

                   ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION
                                   Joe Coto, Chair
                   AB 1753 (Hall) - As Introduced:  April 14, 2010
           
          SUBJECT  :   Slot machines.

           SUMMARY  :   Increases the misdemeanor penalties on non-casino  
          businesses who possess and uses a "slot machine or device," as  
          specified.     Specifically,  this bill  :  

          1)Increases the misdemeanor penalties to provide that a first  
            offense would be punishable by a fine of not less than $500  
            nor more than $1,000, or by imprisonment in a county jail not  
            exceeding six months, or by both that fine and imprisonment.

          2)Increases the misdemeanor penalties to provide that a second  
            offense would be punishable by a fine of not less than $1,000  
            nor more than $10,000, or by imprisonment in a county jail not  
            exceeding six months, or by both that fine and imprisonment.

          3)Increases the misdemeanor penalties to provide that a third or  
            subsequent offense would be punishable by a fine of not less  
            than $10,000 nor more than $25,000, or by imprisonment in a  
            county jail not exceeding one year, or by both that fine and  
            imprisonment.

          4)Provides if the offense involves more than one machine or more  
            than one location, an additional fine of not less than $1,000  
            nor more than $5,000 would be imposed per machine and per  
            location.

          5)Makes relating technical changes.  

           EXISTING LAW  : 

          1)Prohibits the possession and use of a "slot machine or device"  
            as defined under Sections 330a, 330b, and 330.1 of the  
            California Penal Code.

          2)Prohibits certain activities and transactions pertaining to  
            "slot machines or devices" as long as they do not apply to a  
            manufacturer's business activities that are conducted in  
            accordance with the terms of a license issued by a tribal  








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            gaming agency pursuant to the tribal-state gaming compacts  
            entered into in accordance with the federal Indian Gaming  
            Regulatory Act (18 U.S.C. Sec. 1166 to 1168, inclusive, and 25  
            U.S.C. Sec. 2701 et seq.).

          3)Provides varying definitions of "slot machine or device." 

          4)Stipulates that individuals who violate provisions of existing  
            state law is guilty of a misdemeanor and punishable by a fine  
            not less than $100 nor more than $1,000, or by imprisonment in  
            the county jail not exceeding six months, or by both such fine  
            and imprisonment.

          5)Defines, under federal law, a "gambling machine" (15 U.S.C.  
            Sec. 1171 (a) (1)) as-

             a)   Any so-called "slot machine" or any other machine or  
               mechanical device an essential part of which is a drum or  
               reel with insignia thereon, and 

               i)     which when operated may deliver, as the result of  
                 the application of an element of chance, any money or  
                 property, or 

               ii)    by the operation of which a person may become  
                 entitled to receive, as the result of the application of  
                 an element of chance, any money or property; or 

             b)   Any other machine or mechanical device (including, but  
               not limited to, roulette wheels and similar devices)  
               designed and manufactured primarily for use in connection  
               with gambling, and 

               i)     which when operated may deliver, as the result of  
                 the application of an element of chance, any money or  
                 property, or 

               ii)    by the operation of which a person may become  
                 entitled to receive, as the result of the application of  
                 an element of chance, any money or property; or 

             c)   Any subassembly or essential part intended to be used in  
               connection with any such machine or mechanical device, but  
               which is not attached to any such machine or mechanical  
               device as a constituent part. 








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           FISCAL EFFECT  :   Unknown.

           COMMENTS  :   This bill revises the fines for the possession of  
          unlicensed slot machines or similar devices.  According to the  
          author, "The revision of these fines will deter the  
          proliferation of illegal slot machines at non-tribal gaming  
          facilities and provide law enforcement agencies with an  
          important tool to reaffirm the appropriate use and location of  
          slot machines in California."  

           Background  .  "Skill based" slot machines look and act nearly  
          identical to licensed slot machine devices found at tribal  
          gaming facilities.  These mechanical devices are being placed in  
          bars, restaurants, liquor stores and tobacco shops in various  
          places throughout the state.  These mechanical devices are  
          sometimes disguised as video arcade games, which, allows these  
          illegal machines to be placed in public view without being  
          easily detected.  Business owners who operate these machines can  
          switch the machine from arcade game to video slot machine  
          through the use of a remote control.

          Individuals who sell these mechanical devices, and business  
          owners who have these machines in their establishments, claim  
          that California's gaming laws do not apply to them because their  
          slots are games of "skill" and not games of "chance."  As a  
          result, revenues received from these devices are unregulated and  
          go unreported and untaxed.

          According to the Los Angeles Sheriff's Department, this bill's  
          sponsor, law enforcement has lacked the tools necessary to deter  
          and halt these illegal "skill based" slot devices from operation  
          at non-tribal gaming facilities by organized groups.   

          Author and sponsor assert that this bill's intent to increase  
          penalties and fines will better deter people from engaging in  
          this activity and help prevent the victimization of lower income  
          individuals.

           REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          Los Angeles County Sheriff's Department
          California State Sheriffs' Association








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           Opposition 
           
          None on file
           
          Analysis Prepared by  :    Rod Brewer / G. O. / (916) 319-2531