PERMANENT RULES
Effective Date of Rule: Thirty-one days after filing.
Purpose: Proposed changes to WAC 315-04-095(4), retailer credit criteria will enable the lottery director to consider credit worthiness for lottery retailer license applicants by a more specific definition of significant incident. The director will be able to determine which credit history significant incidents prohibit lottery retailer licensing, rather than the current language requirement that all significant incidents create a bar.
Citation of Existing Rules Affected by this Order: Amending WAC 315-04-095(4).
Statutory Authority for Adoption: RCW 67.70.040 (1), (3).
Adopted under notice filed as WSR 10-09-020 on April 13, 2010.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 1, Repealed 0.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 1, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 1, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.
Date Adopted: June 22, 2010.
Jana L. Jones
Director of Legal Services
OTS-2978.2
AMENDATORY SECTION(Amending WSR 07-11-154, filed 5/22/07,
effective 6/22/07)
WAC 315-04-095
Retailer credit criteria.
(1) The
director shall deny a lottery retailer license to any
applicant whose credit is found to be poor.
(2) The director may grant a lottery retailer license to an applicant whose credit is rated as marginal or minimum as defined in this section. Provided, the director shall require:
(a) Applicants whose credit is rated as marginal as defined in this section to obtain a surety bond or savings certificate under terms and conditions established by the director prior to issuance of the license. Such surety bond must be secured from a company licensed to do business in the state of Washington. The bond or certificate shall be in the amount of three thousand five hundred dollars unless the director determines a higher amount is required.
(b) Applicants whose credit is rated as minimum as
defined in this section may be required to obtain a surety
bond or post cash in lieu of a bond under terms and conditions
established by the director or submit three letters of credit
to the lottery prior to issuance of ((the)) a lottery retailer license. Such surety bond must be
secured from a company licensed to do business in the state of
Washington. The bond or cash shall be in the amount of three
thousand five hundred dollars unless the director determines a
higher amount is required, based on sales volume and financial
solvency of the retailer.
(3) In the event the retailer's credit is rated as poor or marginal subsequent to the issuance of the license the director may:
(a) Revoke or suspend a retailer's license; and/or
(b) Require such a retailer to secure a surety bond from a company licensed to do business in the state of Washington or post a savings certificate under terms and conditions established by the director. The surety bond or saving certificate shall be in the amount of three thousand five hundred dollars unless the director determines, based on sales volume and financial solvency of the retailer, a higher amount is required.
(4) Credit rating is defined as the ability to meet
financial obligations when they become due. It includes
current reporting accounts payable and public financial record
information including, but not limited to, court records,
other public records and reports from credit bureaus or other
credit reporting agencies up to three years prior to the
lottery's credit check request. A significant incident
((shall be defined as public financial record information
which)) may include((s any)) a lien, judgment, bankruptcy,
involuntary collection action or any similar incident which
reflects on the individual's willingness and ability to pay
creditors. A numerical rating of "one" represents excellent
credit. A numerical rating of "nine" represents involuntary
collection.
(a) A "poor" credit rating indicates public record showing three or more significant incidents within the past three years.
(b) A "marginal" credit rating indicates public record information showing one or more significant incidents within the past three years.
(c) A "minimum" credit rating indicates the information is insufficient for evaluation.
(d) An "acceptable" credit rating indicates that there have been no significant incidents in the public record within the past three years. Provided, at least three accounts must be evaluated in order to receive an "acceptable" rating.
(5) Credit rating checks shall be conducted as follows:
(a) Corporation business credit ratings shall be checked. Personal credit ratings of the corporate officers and owners of ten percent or more equity in the corporation may also be checked.
(b) Sole proprietors and partnership business credit ratings shall be checked. Personal credit ratings of:
(i) The sole proprietor and his or her spouse; or
(ii) All partners and their spouses shall also be checked.
(c) Findings shall be applied in accordance with subsections (1), (2) and (3) of this section.
[Statutory Authority: RCW 67.70.040 (1), (3) and 67.70.040. 07-11-154, § 315-04-095, filed 5/22/07, effective 6/22/07. Statutory Authority: RCW 67.70.040. 98-20-013, § 315-04-095, filed 9/25/98, effective 10/26/98.]