Puerto Rico: Senate approves amendments to the Gambling Machines Act

Governor Pedro Pierluisi has signed into law House Bill 2190, which guarantees that police pensions reach at least 50% of their salary at the time of retirement. The money was identified through a series of amendments to the law that regulates slot machine revenues.

House Bill 2190 is a measure drafted by the Fiscal Oversight Board and indicates that the pension will be as close as possible to 50% of the Average Compensation, taking into account the income and/or retirement payments that each Eligible Member is entitled to receive for Social Security, annuities, benefits or defined benefits granted by the different retirement programs established by Law 447-1951, Law 305-1999 and Law 3-2013.

The bill provides for amending the Gaming Machines Act and the Police Retirement Trust Act to ensure funding for police retirement.

It establishes that after the law is approved, the Gaming Commission will have 60 days to approve a regulation that establishes the procedure for granting the established licenses.

It also grants 180 days to those wholesale owners with active machine licenses who, at the beginning of the transition period according to the Law, do not yet have all the machines to which they are entitled, so that they can pay the balance of the remaining licenses.

PC 2190 establishes that the first $12 million collected for licenses destined for the General Fund will be remitted to the Fund during the fiscal year. After receiving the first $12 million annually, the income generated by the gambling machines will be distributed as follows:

First, 55% of the income generated by the gambling machines and 22.5% of the net income from electronic video game operations. This is given by Law 83 of 1987, better known as the Law of the Equestrian Industry and Sport.

Both will be deposited in the Police Retirement Trust.

If the Trust is not established, these funds will be transferred to a separate account from the Treasury Department account.

Second, 40% of the income generated by the gambling machines will be sent to the General Fund and will be allocated by allocation made in a Budget Resolution to the municipalities.

Third, 5% of the income generated by the machines will go to the Gaming Commission for the maintenance and operation costs of the system.

Police, Internal Revenue agents and the Gaming Commission will be required to inspect machines for compliance and the Police Bureau may issue an administrative fine of $200 per non-compliant machine.

That money will also be paid in full into the Trust. The compensation received by the retired police officer will be the annual compensation received during the last three years of creditable service.

“In determining the average compensation, the annual compensation may in no case exceed 10% of the annual compensation of the immediately preceding year,” the measure reads.