Original Notice.

     Preproposal statement of inquiry was filed as WSR 03-13-136.

     Title of Rule: Merchandise prizes for punch board and pull-tab games, WAC 230-04-124 Licensing of manufacturer, distributor, gambling service supplier, and linked bingo prize provider representatives -- Exceptions.

     Purpose: To require license of persons that sell merchandise with the intent to be used as a prize for a punch board or pull-tab game.

     Statutory Authority for Adoption: RCW 9.46.070.

     Summary: A petition for rule change was submitted to the commission by Dwight Bailey, Spokane Pull-Tab and Bingo Supply. Mr. Bailey is requesting the licensure of individuals or entities that sell only merchandise to punch board and pull-tab operators to be used as a punch board or pull-tab prize. At the June 13, 2003, commission meeting the commission filed the petition for further discussion.

     Reasons Supporting Proposal: See Purpose above.

     Name of Agency Personnel Responsible for Drafting: Susan Arland, Lacey, (360) 486-3466; Implementation: Rick Day, Lacey, (360) 486-3446; and Enforcement: Bob Berg, Lacey, (360) 486-3452.

     Name of Proponent: Staff, governmental.

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

     Explanation of Rule, its Purpose, and Anticipated Effects: See Purpose and Summary above.

     Proposal Changes the Following Existing Rules: See Purpose and Summary above.

     No small business economic impact statement has been prepared under chapter 19.85 RCW. Proposal is exempt under RCW 19.85.025(2), therefore an SBEIS is not required.

     RCW 34.05.328 does not apply to this rule adoption. This agency does not choose to make section 201, chapter 403, Laws of 1995, apply to this rule adoption.

     Hearing Location: Best Western Icicle Inn, 505 Highway 2, Leavenworth, WA 98826, (509) 548-7000, on September 11 and 12, 2003, at 9:30 a.m.

     Assistance for Persons with Disabilities: Contact Shirley Corbett by September 1, 2003, TDD (360) 486-3637 or (360) 486-3447.

     Submit Written Comments to: Susan Arland, Rules Coordinator, P.O. Box 42400, Olympia, WA 98504-2400, (360) 486-3466, fax (360) 486-3625, by September 1, 2003.

     Date of Intended Adoption: September 12, 2003.

August 1, 2003

Susan Arland

Rules Coordinator

Persons soliciting merchandise prizes must be licensed

     No operator shall purchase or otherwise obtain from any person any non-cash prizes to be used in conjunction with state regulated punch board and/or pull-tabs or related products in this state until it is first determined that the person selling or otherwise offering such product has a valid licensed issued to sell the product in this state or has been registered with the commission as required: Provided That, an operator may purchase merchandise prizes from a catalog, retail or specialty stores bearing a receipt of total good purchased which complies with Washington state rules and guidelines for offering non-cash prizes in a game of chance. The intent of these retail or catalog stores does not reflect the organization's intent to use the products it sells as prizes of chance. The operator will adhere to all rules regulations regarding merchandise prize-boards and is subject to the penalties of violation.

Exceptions - representative license not required.

     (1) The following individuals do not require a separate representative's license:

     (a) A sole owner, partner, major officer or board member and/or owner of a substantial interest in an entity;

     (b) Office, clerical or warehouse personnel who have contact with customers or potential customers only by telephone at the manufacturer's, distributor's, gambling service supplier's, or linked bingo prize provider's own premises when working under the immediate and direct supervision of an owner, partner, major officer, or a licensed manager or supervisor; and

     (c) Resident agents required by WAC 230-12-300 when such agents are not involved in selling or providing products or services for which a license is required.

Signature of employer required.

     (2) The manufacturer, distributor, gambling service supplier, or linked bingo prize provider for which the representative will work shall sign the application acknowledging that the applicant will be representing them with their full knowledge and consent.

Requirements.

     (3) An applicant for a license as a distributor representative, gambling service supplier representative, or linked bingo prize provider representative shall:

Training.

     (a) Complete a training course for any activity being managed, as required and provided by the commission within thirty days after the first day worked; and

Represent only one employer at a time - exceptions.

     (b) Represent only one licensed manufacturer, distributor, gambling service supplier, or linked bingo prize provider at a time and shall not represent a manufacturer: Provided, That this rule shall not prevent a licensed representative from representing a manufacturer, distributor, and/or linked bingo prize provider when all businesses are owned by the same person: Provided further, That this rule shall not bar the distributor's representative from representing his own distributor who is also licensed as a manufacturer.

Conflict of interest.

     (4) If a licensed gambling service supplier representative has any interest in a licensed manufacturer or distributor and they provide services to any punch board, pull-tab, or bingo operator, they shall inform the commission, the operator, and the manufacturer or distributor of the relationship. Such manufacturer or distributor shall be prohibited from selling punch boards, pull-tabs, or disposable bingo cards to such operator.

[Statutory Authority: RCW 9.46.070. 00-15-039 (Order 385), § 230-04-124, filed 7/14/00, effective 1/1/01; 98-24-090 (Order 369), § 230-04-124, filed 12/1/98, effective 1/1/99; 98-19-130 (Order 362), § 230-04-124, filed 9/23/98, effective 1/1/99; 97-24-031, § 230-04-124, filed 11/25/97, effective 1/1/98. Statutory Authority: RCW 9.46.070 and 9.46.0331. 91-19-093 (Order 227), § 230-04-124, filed 9/18/91, effective 10/19/91. Statutory Authority: RCW 9.46.070 (4), (11) and (14). 89-24-002 (Order 201), § 230-04-124, filed 11/27/89, effective 12/28/89.]

     Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.

     Reviser's note: The bracketed material preceding the section above was supplied by the code reviser's office.

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