Charitable Gambling Minutes 1/19/2022

Faribault Rotary Youth Services, Inc.
Membership Meeting Minutes
January 19, 2022
  • As illustrated above, December 2021 was a record in revenue for FRYS’ charitable gambling operation with total revenue of $157K
  • However, December illustrated the probabilities of gambling as FRYS’ gross margin weakened to an aggregate of 16% from November’s 19%
    • The tightening was due to a large reduction in paper tabs, falling to 12% from 19%, respectively.
  • Net income was $12,370, which was down from $18,643 one month prior. Net income partially operates in arrears, meaning the profit sharing with Boxers and MPeters (pull tab supplier) is paid in the following month, so net income was lower due to the profit-sharing being paid in December for the strong performance in November.
  • Next came expense approvals for the coming month of February 2022
    • CG Made Easy Administrative Fee = $250
      • Fixed fee every month
    • Inventory = $4,000
      • While current inventory is favorable, FRYS is expanding operations at Boxers once again in February with the addition of new boxes
    • Gambling Team Compensation = $2,600
      • Faribault Rotary Board approved a compensation increase for FRYS’ charitable gambling team
    • Revenue Share with MPeters = $10,000
      • Profit share is 31% of e-tab gaming  à revenue share with MPeters almost hit the approved amount of $7K, so a larger cushion is needed to support the expanded operation
    • City of Faribault = $1,000
      •  Similar to above à expanded operation and greater revenue means large tax obligations to the city
    • Revenue Share with Boxers = $8,000
      • As with MPeters, the larger operation needs a greater cushion to ensure approved expenses do not exceed the actual amount  
    • Bing Compensation = $1,000
      • Part of FRYS’ expanded operation now includes Bingo twice a month that FRYS pays to staff
    • Total Expenses Approved = $26,850
      • On a motion by Dr. Murray Hanson followed by Kurt Halverson, FRYS Membership approved February 2022’s expenses
  • Amy Amundson, treasurer of the charitable gambling, provided notice that FRYS’ bank account was approaching $48K in funds and had adequate levels of liquidity to repay the $10,000 startup loan that the main Rotary organization provided to FRYS to fund start-up costs.
    • On a motion by George Wickstrom and seconded by Natalie Ginter, membership approved repaying the $10,000 loan
    • FRYS now needs to obtain approval from the State of MN Gambling Control Board to repay the funds
  • In other news, FRYS continues to work to obtain approval to have a pull tab operation at the MN Town Ball tournament this summer
  • Rotary President, Todd Sesker, is working on establishing a committee to screen, review and process charitable gambling funds