Staff proposes administrative reforms and a 10% city-administered charitable gambling fund; council splits on mandatory contribution

City Clerk Jamie Hanson and staff presented an in-depth review of charitable gambling operations in Bloomington on April 27, including statutory limits, local practices, and financial data from 2025. Hanson said Bloomington hosts 11 organizations at 22 locations producing roughly $9 million annually, with about $1.6 million spent on lawful purpose expenditures in the trade area and an estimated $195,000 potential annual revenue from a proposed 10% city-administered net-profits fund.

Staff recommended several code changes: standardized reporting via a staff form, receiving copies of reports submitted to the state, establishing an annual renewal process, and creating a code process to revoke a city's approval of an organization that fails to comply. Separately, staff recommended the council consider directing up to 10% of net profits to a city-administered fund—allowable under state statute—and suggested the animal shelter as a priority use.

Council reaction was mixed. Several members supported stronger administration, reporting and the ability to revoke noncompliant organizations. Many expressed reservations about a mandatory 10% contribution, arguing it could take funds from nonprofits; some suggested covering city administrative costs with a modest tax or permit fee instead and considering earmarks for gambling-harm mitigation or public health programs. Council members also discussed local nexus rules (requiring funds benefit Bloomington addresses) and the trade-area limitations set by state law.

Council did not adopt a final policy but directed staff to continue public engagement, to prepare options (including possible local-tie provisions, administrative fees, or a contribution model) and to return for a public hearing. Staff said collection would begin in 2027 if a 10% fund were adopted to give organizations time to adapt.