WSR 97-15-092

PROPOSED RULES

GAMBLING COMMISSION

[Filed July 17, 1997, 3:47 p.m.]

Original Notice.

Preproposal statement of inquiry was filed as WSR 96-15-020.

Title of Rule: Pull tab rule--Pull tab series with carry-over jackpots--Definitions--Requirements, WAC 230-30-045.

Purpose: This new rule regulates the carry over of jackpots and the awarding of the prize so that the potential for fraud is minimized.

Statutory Authority for Adoption: RCW 9.46.070 (2), (11), (14).

Statute Being Implemented: See above.

Summary: See Purpose above.

Reasons Supporting Proposal: The carry-over jackpot represents a new type of pull tab game. A new rule is needed to address the possibility and incentive for manipulation of carry-over jackpots.

Name of Agency Personnel Responsible for Drafting: Soojin Kim, Lacey, (360) 438-7654 ext. 310; Implementation: Frank Miller, Lacey, (360) 438-7654 ext. 302; and Enforcement: Ben Bishop, Lacey, (360) 438-7654 ext. 370.

Name of Proponent: Staff, in conjunction with representatives from charitable and nonprofit organizations, private.

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

Explanation of Rule, its Purpose, and Anticipated Effects: See Purpose and Reasons Supporting Proposal above.

Proposal does not change existing rules.

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

Section 201, chapter 403, Laws of 1995, 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: Holiday Inn Sea-Tac, 17338 International Boulevard, SeaTac, WA 98188, on September 11, 1997, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact Susan Green by September 1, 1997, TDD (360) 438-7638, or (360) 438-7654 ext. 302.

Submit Written Comments to: Soojin Kim, Mailstop 42400, Olympia, WA 98504-2400, FAX (360) 438-8652, by August 31, 1997.

Date of Intended Adoption: September 11, 1997.

July 17, 1997

Soojin Kim

Rules and Policy Coordinator

NEW SECTION

WAC 230-30-045 Pull tab series with carry-over jackpots--Definitions--Requirements. Operators may utilize pull tab series that are specifically designed to include carry-over jackpots. The following definitions and requirements shall apply to these series:

What definitions apply?

(1) Definitions which apply to pull tab series with carry-over jackpots:

(a) "Carry-over jackpot" means a prize pool that is composed of accumulated contribution amounts from pull tab series which, if not won, are carried over to other pull tab series;

(b) "Contribution amount" means the amount from each series which is added to the carry-over jackpot; and

(c) "Guaranteed prizes" means all prizes available to be won, excluding the contribution amount or carry-over jackpot;

What are the requirements that apply to prizes and prize payout calculations?

(2) The following requirements apply to carry-over jackpot prizes and prize payout calculations:

(a) The contribution amount for each pull tab series may be included in the sixty percent minimum payout required by WAC 230-30-080. The contribution amounts carried over from previous series shall not be included in the sixty percent calculation;

(b) Guaranteed prizes must be 55% or more of gross receipts available from the pull tab series;

(c) The contribution amount for each series may not be more than five hundred dollars;

(d) The contribution amount and the method of play shall be determined by the manufacturer and disclosed on the flare;

(e) At no time shall an accumulated carry-over jackpot exceed two thousand dollars. If a jackpot reaches this amount, it shall be awarded to the first player to win a chance at the jackpot on the series. At the point the jackpot reaches two thousand dollars, the series shall not be pulled from play until it is awarded; and

(f) The carry-over jackpot must be awarded. Failure to have sufficient funds available, or any attempt by an operator to utilize carry-over jackpots for personal or organizational purposes, shall be prima facie evidence of defrauding the players in violation of RCW 9.46.190;

What additional requirements apply?

(3) The following additional requirements apply to pull tab series with carry-over jackpots:

(a) If bonus pull tab series are used:

(i) The odds of winning the carry-over jackpot shall not exceed one winner out of five chances, or the probability of winning the carry-over jackpot shall be .20 or higher, at the jackpot level;

(ii) There may only be one advance level on the flare;

(iii) There shall be at least one guaranteed chance to win the carry-over jackpot;

(iv) All chances that are included on the flare shall be covered in a manner that prevents determination of the concealed numbers or symbols prior to being opened by the player. If perforated windows are used, the numbers or symbols must be covered by latex, foil, or other approved means; and

(v) Standards for bonus pull tab flares, as set forth in WAC 230-30-106, shall apply;

(b) The maximum ticket count for pull tab series with carry-over jackpots shall be six thousand tickets; and

(c) The secondary win codes on pull tab series with carry-over jackpots must not repeat within a three-year period;

What operating and recordkeeping requirements apply?

(4) The following operating and recordkeeping requirements apply to pull tab series with carry-over jackpots:

(a) If the chances of winning the carry-over jackpot are obtained and the carry-over jackpot is not won, the series shall be removed from play within seven days;

(b) If a carry-over jackpot is not won prior to removing a series from play, it shall be carried over to a new series and placed out within twenty-four hours. The accrued contribution amounts from all previous series shall be added to the contribution amount from the new series;

(c) The following additional records must be maintained for pull tab series with carry-over jackpots:

(i) For carry-over jackpots six hundred dollars and over, the winner's full name, address, and Social Security number shall be recorded on a separate form for income tax purposes;

(ii) All winning tabs and winner information for carry-over jackpots, along with the flares, must be retained for at least one year from the date the series was removed from play or six months from the date the carry-over jackpot was awarded, whichever is greater; and

(iii) Operators are required to maintain a separate record documenting the flow of carry-over jackpots from one game to another in a format prescribed by the commission; and

What aspects of games must be approved prior to sale?

(5) The director shall approve the following aspects of all pull tab games with carry-over jackpots prior to sale in Washington state:

(a) The design, payout, method of play, and flare for each pull tab series;

(b) The manufacturing process for the pull tab series and flares; and

(c) The secondary win code system for the pull tab series.