WSR 12-22-044

PROPOSED RULES

GAMBLING COMMISSION


[ Filed November 2, 2012, 3:27 p.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 12-19-041.

Title of Rule and Other Identifying Information: WAC 230-03-065 Spouses must also be qualified and 230-03-045 Defining substantial interest holder.

Hearing Location(s): Comfort Inn Conference Center (tentative), 1620 74th Avenue S.W., Tumwater, WA 98501, on January 10 or 11, 2013, at 9:30 a.m. or 1:30 p.m. NOTE: Meeting dates and times are tentative. Visit our web site at www.wsgc.wa.gov and select public meeting about ten days before the meeting to confirm meeting date/location/start time.

Date of Intended Adoption: January 10 or 11, 2013. NOTE: Meeting dates and times are tentative. Visit our web site at www.wsgc.wa.gov and select public meeting about ten days before the meeting to confirm meeting date/location/start time.

Submit Written Comments to: Susan Newer, P.O. Box 42400, Olympia, WA 98504-2400, e-mail Susan.Newer@wsgc.wa.gov, fax (360) 486-3625, by December 24, 2012.

Assistance for Persons with Disabilities: Contact Gail Grate by January 1, 2013, TTY (360) 486-3637 or (360) 486-3453.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The proposed rule change would no longer require spouses of officers of charitable or nonprofit organizations (C/NP), or board members of publicly-traded entities to undergo background checks.

Staff has recognized that spouses of board members of publicly-traded licensees and C/NP officers pose little to no regulatory risk. Spouses of C/NP officers have no actual or potential influence over the decision making of the organization. We are not aware of other jurisdictions in the United States that require spouses of board members or C/NP officers to undergo background checks.

Reasons Supporting Proposal: See above.

Statutory Authority for Adoption: RCW 9.46.070(7).

Statute Being Implemented: Not applicable.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: Washington state gambling commission, governmental.

Name of Agency Personnel Responsible for Drafting: Susan Newer, Lacey, (360) 486-3466; Implementation: Rick Day, Director, Lacey, (360) 486-3446; and Enforcement: Mark Harris, Assistant Director, Lacey, (360) 486-3579.

No small business economic impact statement has been prepared under chapter 19.85 RCW. A small business economic impact statement was not prepared because the proposed rule change does not impose additional costs on businesses.

A cost-benefit analysis is not required under RCW 34.05.328. The Washington state gambling commission is not an agency that is statutorily required to prepare a cost-benefit analysis under RCW 34.05.328.

November 2, 2012

Susan Newer

Rules Coordinator

OTS-5085.1


AMENDATORY SECTION(Amending Order 457, filed 3/22/06, effective 1/1/08)

WAC 230-03-045   Defining substantial interest holder.   (1) "Substantial interest holder" means a person who has actual or potential influence over the management or operation of any organization, association, or other business entity.

(2) Evidence of substantial interest may include, but is not limited to:

(a) Directly or indirectly owning, operating, managing, or controlling an entity or any part of an entity; or

(b) Directly or indirectly profiting from an entity or assuming liability for debts or expenditures of the entity; or

(c) Being an officer or director or managing member of an entity; or

(d) Owning ten percent or more of any class of stock in a privately or closely held corporation; or

(e) Owning five percent or more of any class of stock in a publicly traded corporation; or

(f) Owning ten percent or more of the membership shares/units in a privately or closely held limited liability company; or

(g) Owning five percent or more of the membership shares/units in a publicly traded limited liability company; or

(h) Providing ten percent or more of cash, goods, or services for the start up of operations or the continuing operation of the business during any calendar year or fiscal year. To calculate ten percent of cash, goods, or services, take the operational expenses of the business over the past calendar or fiscal year, less depreciation and amortization expenses, and multiply that number by ten percent; or

(i) Receiving, directly or indirectly, a salary, commission, royalties, or other form of compensation based on the gambling receipts.

(3) Spouses of officers of charitable or nonprofit organizations and spouses of board members of publicly traded entities are not considered substantial interest holders.

[Statutory Authority: RCW 9.46.070. 06-07-157 (Order 457), 230-03-045, filed 3/22/06, effective 1/1/08.]


AMENDATORY SECTION(Amending Order 457, filed 3/22/06, effective 1/1/08)

WAC 230-03-065   Spouses must also be qualified.   (1) Applicants' spouses must also meet the qualifications to hold a gambling license when married persons who maintain a marital community apply for or hold a license to operate gambling activities. This includes, but is not limited to, owners and substantial interest holders of commercial gambling establishments and officers of charitable or nonprofit organizations.

(2) If you are a licensed employee of a gambling operation, officer of a charitable or nonprofit organization, or a board member of a publicly traded entity, your spouse does not need to meet the licensing qualifications.

[Statutory Authority: RCW 9.46.070. 06-07-157 (Order 457), 230-03-065, filed 3/22/06, effective 1/1/08.]