Resolution No. 2005-03 (Adopted 11/08/2005) (RESCINDED on 09/08/09 by Resolution No. 2009-01) Expanding the Monetary Limit at Which Persons Involved in the Construction of Permanent Casinos Who are Prime Contractors May Still Qualify for a Vendor Exempt

STATE OF MICHIGAN

THE MICHIGAN GAMING CONTROL BOARD

 

RESOLUTION N0. 2005-03

 

 

A Board Resolution Expanding the Monetary Limit at which Persons Involved in the Construction of Permanent Casinos Who are  Prime Contractors May Still Qualify for a Vendor Exemption Under Resolution 2003-07 From $2,000,000 to $8,000,000.  


 

WHEREAS,the Michigan Gaming Control Board ("Board") is empowered by the Michigan Gaming Control and Revenue Act, as amended, Public Act 69 of 1997, MCL 432.201 et seq. ("Act") to promulgate rules as may be necessary to implement, administer, and enforce the Act; and,

 

WHEREAS, the Board has adopted and promulgated administrative rules ("Rules") with respect to the licensing of persons providing goods and services to casinos licensed under the Act and Rules; and,

 

WHEREAS, Rule 432.1322(1) requires that a person shall not, on a regular and continuing basis, supply goods or services to a casino licensee unless that person holds a supplier license; and,

 

WHEREAS, Rule 432.1322(3) provides that a person shall be deemed to be transacting business with a casino licensee on a "regular and continuing basis" whenever the total dollar amount of the nongaming-related business transactions with 1 licensee will be equal to or greater than $200,000, or equal to or greater than $400,000 with 2 or more licensees in a twelve-month period; and,

 

WHEREAS, certain prospective providers of goods and services have asked for, or inquired about, exemption from supplier licensing requirements under Rule 432.1322(4); and,

 

WHEREAS, the construction of permanent casinos and the magnitude of the projects will create unique licensing issues that are unlikely to be present in the future; and,

 

WHEREAS, the Board believes it is necessary to expand and clarify the circumstances in which persons seeking business relationships with casino licensees can be exempted from supplier licensing requirements, or have them waived, because their licensure is not deemed necessary to protect the public interest or to accomplish the policies and purposes of the act; and,

 

WHEREAS, it is necessary to create a system by which licensed casinos can easily verify whether suppliers with whom they are either doing business or contemplating the initiation of a business relationship are in compliance with the supplier licensing requirements of the Act and Rules; and,

 

WHEREAS, the Board has adopted and promulgated Rule 432.1322(4) that provides the Board may exempt any person or field of commerce from the supplier licensing requirements of its administrative rules, if the Board determines that any of the following provisions apply to the person or field of commerce:

 

a. The person or field is an agency of state, local, or federal government,

 

b. The person or field is regulated by another regulatory agency in Michigan,

 

c. The person or field will provide goods or services of insubstantial or insignificant amounts or quantities,

 

d. Licensing of the person or field is not deemed necessary to protect the public interest or accomplish the policies and purposes of the act; and,

 

WHEREAS, Rule 432.1223 provides that the Board "may, in writing, waive, restrict, or alter any requirement or procedure set forth in these rules, if the board determines that the requirement or procedure is impractical or burdensome, that the waiver, restriction, or alteration is in the best interest of the public and the gaming industry, and that the waiver, restriction, or alteration is not outside the technical requirements necessary to serve the purpose of the requirement or procedure"; and,

 

WHEREAS, MCL 432.204(8) provides for the Executive Director to perform any and all duties that the Board shall assign to him or her; and,

 

WHEREAS, the Board has adopted and promulgated Rule 432.1214 delegating to its Executive Director all power and authority to act in the name of the Board with respect to all reasonable, necessary, and appropriate actions to administer and carry out the administrative and executive functions of the Board; and,

 

WHEREAS, Rule 432.1214(j) specifically provides that the Executive Director has the power to "grant requests and waivers, answer inquiries, issue interpretations, and otherwise take any action that is reasonably requested by applicants, licensees, and holders of certificates of suitability in furtherance of, and consistent with, the efficient administration and enforcement of the provisions of the act and these rules, as determined to be necessary or appropriate by the executive director"; and,

 

WHEREAS, the Board believes it is necessary and appropriate for purposes of administrative efficiency to expressly delegate its power and authority to the Executive Director to waive supplier licensing requirements in certain circumstances described herein and to exempt persons providing goods and services to a casino licensee from supplier licensing requirements where such persons meet the criteria for exemption set forth in Rule 432.1322(4) and this resolution; and,

 

WHEREAS , MCL 432.202(h) defines a "vendor" as "means a person who is not licensed under this act who supplies any goods or services to a casino licensee or supplier licensee"; and,

 

WHEREAS,   MCL 432.204a(s) gives the Board the power and authority to "perform a background check, at the vendor's expense, of any vendor using the same standards that the board uses in determining whether to grant a supplier's license"; and,

 

WHEREAS,   the Board adopted Resolution 2003-07 that in Section 7 established a category of vendor exemption for persons working on construction of the permanent casinos who are prime contractors whose contract amount does not exceed $2,000,000; and,

 

WHEREAS , it is necessary to clarify and modify the provisions regarding the eligibility of   prime contractors for a vendor exemption; and,

 

IT IS RESOLVED   that Section 7 of Resolution 2003-07 is amended to increase the monetary limit at which prime contractors may be eligible for vendor exemptions in Section 7c from $2,000,000 to $8,000,000 as follows:

7.  Persons involved in the construction of the permanent casino complexes who submit an application and/or disclosure prescribed by the Executive Director that is designed to elicit sufficient information to carry out the purpose and intent of the supplier licensing requirements in the Act and Rules.  This vendor exemption is strictly limited to work performed on the initial construction of the permanent casino complexes, and is for persons who are not one of the following:

 

a.  A person providing gaming-related goods or services for the construction, maintenance or operation of a casino or casino enterprise;

b.  A person providing nongaming-related goods or services for the construction of the permanent casino complexes where the person is a party to an agreement with a casino licensee, and the amount of business is $200,000 or more within any twelve-month period (or $400,000 total business with more than one casino licensee);

c.  A person who is a prime contractor, which means any person who is a party to a contract(s) or subcontract(s) with another contractor(s) for a major portion of a permanent casino complex construction project as defined by the CSI Master Format Division and Subdivision, and whose contract amount exceeds $8,000,000, within any twelve-month period;

d.  A person involved in, or who will be involved in either the installation, operation or maintenance of any of the following work areas or activities after the rough construction is completed:

i.      The main cage and all secondary cages;

ii.     The vault and vault annex;

iii.    Security systems;

iv.    Surveillance systems;

v.     On-Line gaming systems;

vi.    Gaming monitoring systems;

vii. Hard and soft count rooms.

e.  All other persons providing goods or services for the construction or operation of a permanent casino complex or casino enterprise when deemed necessary to protect the public interest and to carry out the purposes of the Act and Rules.

 

ADOPTED AND ISSUED THIS 8TH DAY OF NOVEMBER, 2005.

 

STATE OF MICHIGAN

MICHIGAN GAMING CONTROL BOARD

 

 

 

__________________________________

Damian S. Kassab, Chairperson

 

 

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Attest:

 

 

 

__________________________________

 

 

Received and Filed:

 

 

 

__________________________________

Patricia S. James

Board Secretary