Chapter 4 Revision Discussion

City Attorney, Dean Hammer and Finance Officer, Christina Smith have worked on Chapter 4 revisions.  We reviewed current state laws while reviewing Chapter 4.  Some of these Sections have not been reviewed since the 1970's.  As state law changes some of these need to be updated.  Dean and I looked over all of Chapter 4 to make sure we are in compliance with State law.

Three items staff needs direction on from council is Section 4-15 and 4-16 and video lottery fee.  We are currently maxed out on our on-and-off sale liquor licenses.  State law states that a new off sale liquor license can not be less than $300.00. The Council can set the price for a new license at a price greater than this.  On-sale liquor can not be less than one dollar for each person residing within the municipality as measure by the last preceding federal census.  Currently, the on-sale fee is $3,996.

Examples: Brandon        On sale = $6.00 times population   Off sale = $0.50 times population

                   Brookings     On sale = $100,000 (population is around 24K so more than $4.00 times population)

                   Spearfish      On sale = minimum of $300,000 accepted via sealed bid process      Off sale = Minimum of $100,000 accepted via sealed bid

                   Yankton        Sealed bid process for both.  Most recent bid for off sale was $35,000

                   Sioux Falls    Sealed bid process for both.  

With the addition of 20 new video lottery machines recently and while we are updating Chapter 4 it is worth a discussion on whether Dell Rapids wants to impose a Video Lottery Fee.  If council wishes to do so, I would recommend the max of $50.00 per machine and start as of 1/1/2027 due to the timing of this revision.

35-4-103. Annual additional license fee for video lottery machines on licensed premises.

Any municipality or county may impose on any person who is licensed pursuant to this chapter and who is issued a video lottery establishment license pursuant to § 42-7A-41 an annual additional license fee for the privilege of locating video lottery machines on the licensed premises. The fee may not exceed fifty dollars for each video lottery machine. The fees imposed by this section are in addition to fees imposed under §§ 35-4-2 and 42-7A-41 and shall be paid at the same time and in the same manner as the fees paid in § 35-4-2. All fees received under this section shall be deposited into the general fund of the municipality or county having jurisdiction over the licensee. However, the municipality or county may not impose this additional fee on more than one license per location.

Brandon, Harrisburg, Tea, Sioux Falls, Mitchell, Madison are the cities I found with a quick look on who charges the Video Lottery fee currently.

Review the changes City Attorney and Finance Officer have made on Chapter 4