AN ACT Relating to the transfer of money from the state lottery account to the general fund; amending RCW 67.70.040, 67.70.190, and 67.70.240; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. Section 4, chapter 7, Laws of 1982 2nd ex. sess. as last amended by section 2, chapter 511, Laws of 1987 and RCW 67.70.040 are each amended to read as follows:

The commission shall have the power, and it shall be its duty:

(1) To promulgate such rules governing the establishment and operation of a state lottery ((~~as it deems necessary and desirable in order that such a lottery be initiated at the earliest feasible and practicable time, and~~)) in order that such lottery produce the maximum amount of net revenues for the state consonant with the dignity of the state and the general welfare of the people. Such rules shall include, but shall not be limited to, the following:

(a) The type of lottery to be conducted which may include the selling of tickets or shares, or the use of electronic or mechanical devices or video terminals which do not require a printed ticket: PROVIDED, That approval of the legislature shall be required before entering any agreement with other state lotteries to conduct shared games;

(b) The price, or prices, of tickets or shares in the lottery;

(d) The manner of selecting the winning tickets or shares;

(e) The manner and time of payment of prizes to the holder of winning tickets or shares which, at the director's option, may be paid in lump sum amounts or installments over a period of years;

(f) The frequency of the drawings or selections of winning tickets or shares, without limitation;

(g) Without limit as to number, the type or types of locations at which tickets or shares may be sold;

(h) The method to be used in selling tickets or shares, which may include the use of electronic or mechanical devices and video terminals;

(i) The licensing of agents to sell or distribute tickets or shares, except that a person under the age of eighteen shall not be licensed as an agent;

(j) The manner and amount of compensation, if any, to be paid licensed sales agents necessary to provide for the adequate availability of tickets or shares to prospective buyers and for the convenience of the public;

(k) The apportionment of the total revenues accruing from the sale of lottery tickets or shares and from all other sources among: (i) The payment of prizes to the holders of winning tickets or shares, which shall not be less than forty-five percent of the gross annual revenue from such lottery, less amounts of unclaimed prizes deposited in the general fund under RCW 67.70.190, (ii) transfers to the lottery administrative account created by RCW 67.70.260, and (iii) transfer to the state's general fund. Transfers to the state general fund shall be made in compliance with RCW 43.01.050;

(l) Such other matters necessary or desirable for the efficient and economical operation and administration of the lottery and for the convenience of the purchasers of tickets or shares and the holders of winning tickets or shares.

(2) To ensure that in each place authorized to sell lottery tickets or shares, on the back of the ticket or share, and in any advertising or promotion there shall be conspicuously displayed an estimate of the probability of purchasing a winning ticket.

(3) To amend, repeal, or supplement any such rules from time to time as it deems necessary or desirable.

(4) To advise and make recommendations to the director for the operation and administration of the lottery.

Sec. 2. Section 19, chapter 7, Laws of 1982 2nd ex. sess. as amended by section 8, chapter 511, Laws of 1987 and RCW 67.70.190 are each amended to read as follows:

(1) Unclaimed prizes shall be retained in the state lottery account for the person entitled thereto for one hundred eighty days after the drawing in which the prize is won, or after the official end of the game for instant prizes. If no claim is made for the prize within this time, the prize shall be retained in the state lottery ((~~fund for further use as prizes~~)) account as provided in subsection (2) of this section and all rights to the prize shall be extinguished.

(2) Moneys retained in the state lottery account under subsection (1) of this section shall be distributed as follows:

(a) Fifty percent of the moneys, not exceeding one million dollars in any fiscal year, shall be deposited quarterly in the general fund.

(b) The remainder of the moneys shall be retained in the state lottery account for further use as prizes.

Sec. 3. Section 24, chapter 7, Laws of 1982 2nd ex. sess. as last amended by section 7, chapter 513, Laws of 1987 and RCW 67.70.240 are each amended to read as follows:

The moneys in the state lottery account shall be used only: (1) For the payment of prizes to the holders of winning lottery tickets or shares; (2) for purposes of making deposits into the reserve account created by RCW 67.70.250 and into the lottery administrative account created by RCW 67.70.260; (3) for purposes of making deposits into the state's general fund; (4) ((~~for purposes of making deposits into the housing trust fund under the provisions of section 7 of this 1987 act; (5)~~)) for the purchase and promotion of lottery games and game-related services; and ((~~(6)~~)) (5) for the payment of agent compensation.

The office of financial management shall require the allotment of all expenses paid from the account and shall report to the ways and means committees of the senate and house of representatives any changes in the allotments.

NEW SECTION. Sec. 4. This act shall take effect July 1, 1988.