WSR 97-20-052

PERMANENT RULES

LOTTERY COMMISSION

[Filed September 24, 1997, 12:01 p.m.]

Date of Adoption: September 12, 1997.

Purpose: Establishes game play rules and criteria for determining winners of Instant Game Nos. 204, 205, 206, and 207; amends WAC 315-06-120 to allow Lotto jackpot winners to assign all or part of their prize to a third party; and amends WAC 315-06-123 to allow the lottery to recover administrative costs associated with processing prizes assigned to a third party.

Citation of Existing Rules Affected by this Order: Amending WAC 315-06-120 and 315-06-123.

Statutory Authority for Adoption: RCW 67.70.040.

Adopted under notice filed as WSR 97-15-123 on July 23, 1997.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, amended 0, repealed 0; Federal Rules or Standards: New 0, amended 0, repealed 0; or Recently Enacted State Statutes: New 0, amended 0, repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, amended 0, repealed 0.

Number of Sections Adopted on the Agency's own Initiative: New 4, amended 2, repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, amended 0, repealed 0.

Number of Sections Adopted using Negotiated Rule Making: New 0, amended 0, repealed 0; Pilot Rule Making: New 0, amended 0, repealed 0; or Other Alternative Rule Making: New 0, amended 0, repealed 0.

Effective Date of Rule: Thirty-one days after filing.

September 16, 1997

Merritt D. Long

Director

NEW SECTION

WAC 315-11A-204 Instant Game Number 204. (1) Essential game elements shall appear as set forth in the executed working papers for Instant Game Number 204, on file at the lottery headquarters office.

(2) Price per ticket: One dollar.

(3) Prizes available: $1, $2, $3, $4, $5, $10, $20, $50, $100, $200, $300, $500, and $1,000. Players may win more than one prize per ticket.

(4) Manner of selecting winning tickets: Match "Your Score" to the "Winning Bullseye Score." Uncover a dart symbol to double the corresponding prize.

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NEW SECTION

WAC 315-11A-205 Instant Game Number 205. (1) Essential game elements shall appear as set forth in the executed working papers for Instant Game Number 205, on file at the lottery headquarters office.

(2) Price per ticket: One dollar.

(3) Prizes available: $1, $2, $3, $4, $5, $6, $10, $25, $50, $100, $200, $500, $1,000, $2,000, and $3,000. Players may win more than one prize per ticket.

(4) Manner of selecting winning tickets: Match any of the "Your Symbols" to the "Winning Symbol."

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NEW SECTION

WAC 315-11A-206 Instant Game Number 206. (1) Essential game elements shall appear as set forth in the executed working papers for Instant Game Number 206, on file at the lottery headquarters office.

(2) Price per ticket: Two dollars.

(3) Prizes available: $2, $4, $8, $20, $50, $100, $500, and $10,000. Players may win more than one prize per ticket.

(4) Manner of selecting winning tickets: Uncover three like cards within one hand to win the amount shown on the legend on the front of the ticket.

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NEW SECTION

WAC 315-11A-207 Instant Game Number 207. (1) Essential game elements shall appear as set forth in the executed working papers for Instant Game Number 207, on file at the lottery headquarters office.

(2) Price per ticket: Three dollars.

(3) Prizes available: $1, $2, $3, $5, $6, $10, $15, $20, $25, $30, $50, $500, $1,500, $3,000, and $10,000. Players may win more than one prize per ticket.

(4) Manner of selecting winning tickets: The sum of the yards within a game totals 10 or more. Uncover the word "Touchdown" in the Bonus Play to win $25 instantly.

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AMENDATORY SECTION (Amending WSR 96-19-071, filed 9/17/96, effective 10/18/96)

WAC 315-06-120 Payment of prizes--General provisions. (1) The director may designate claim centers for the filing of prize claims, and the location of such centers shall be publicized from time to time by the director.

(2) A claim shall be entered in the name of one claimant, which shall be either a natural person, association, corporation, general or limited partnership, club, trust, estate, society, company, joint stock company, receiver, trustee, or another acting in a fiduciary or representative capacity whether appointed by a court or otherwise. A claim which includes one or more tickets with an address label or stamp on the back of the ticket shall be deemed to have been entered in the name of one claimant: Provided, That if the address label or stamp contains the name of more than one claimant, the prize payment will be made to the one who has signed the ticket and/or claim form or, if there is no signature or two signatures, to the first claimant listed on the address label or stamp. The claimant must submit his or her Social Security number (SSN) or the federal employer's identification number (FEIN) when claiming any prize exceeding six hundred dollars.

(3) A claim may be entered in the name of a claimant other than a natural person only if the claimant is a legal entity and possesses a federal employer's identification number (FEIN) as issued by the Internal Revenue Service, such number is shown on the claim form and the entity's terms comply with subsection (4) of this section. Groups, family units, organizations, clubs, or other organizations which are not a legal entity, or do not possess a federal employer's identification number, shall designate one natural person or one legal entity in whose name the claim is to be entered.

(4) The terms governing a claimant other than a natural person, i.e., articles of incorporation, trust terms, etc., shall be submitted to the director for approval. Terms not in compliance with lottery statutes or rules shall not be approved. Payment shall not be made to a claimant other than a natural person until the director has approved the terms.

All claimants other than natural persons shall have governing terms which:

(a) Prohibit deletion, amendment, or addition of terms without the director's approval;

(b) State the names of all natural persons who have a direct or indirect right or interest in the claimant, each of their percentage interests and their Social Security numbers;

(c) Acknowledge that the debt collection process mandated by RCW 67.70.255 and WAC 315-06-125 shall be applied to the natural persons who hold interests in the claimant through their Social Security numbers; and

(d) Provide that in the event the claimant ceases to exist prior to the full payout of the prize, the lottery will not make further payment without court order.

(5) The lottery shall not make payment to a claimant other than a natural person unless the terms governing the claimant include those enumerated in subsection (4) of this section.

(6) Unless otherwise provided in the rules for a specific type of game, a claimant shall sign the back of the ticket and/or complete and sign a claim form approved by the director. The claimant shall submit the claim form and/or claimant's ticket to the lottery in accordance with the director's instructions as stated in the players' manual and/or on the back of the ticket or submit a request for reconstruction of an alleged winning ticket and sufficient evidence to enable reconstruction and that the claimant had submitted a claim for the prize, if any, for that ticket. The claimant, by submitting the claim or request for reconstruction, agrees to the following provisions:

(a) The discharge of the state, its officials, officers, and employees of all further liability upon payment of the prize; and

(b) The authorization to use the claimant's name and, upon written permission, photograph for publicity purposes by the lottery.

(7) A prize must be claimed within the time limits prescribed by the director in the instructions for the conduct of a specific game, but in no case shall a prize be claimed later than one hundred eighty days after the official end of that instant game or the on-line game drawing for which that on-line ticket was purchased.

(8) The director may deny awarding a prize to a claimant if:

(a) The ticket was not legally issued initially;

(b) The ticket was stolen from the commission, director, its employees or retailers, or from a lottery retailer; or

(c) The ticket has been altered or forged, or has otherwise been mutilated such that the authenticity of the ticket cannot be reasonably assured by the director.

(9) No natural person or legal entity entitled to a prize may assign the right to payment, except under the following limited circumstances:

(a) That payment of a prize may be made to any court appointed legal representative, including, but not limited to, guardians, executors, administrators, receivers, or other court appointed assignees; and

(b) When payment of all or part of the ((entire)) remainder of an annuity and the right to receive future annual prize payments has been voluntarily assigned to another person, pursuant to an appropriate judicial order that meets the requirements of RCW 67.70.100(2). ((No voluntary assignment is effective unless and until the national office of the Federal Internal Revenue Service provides a ruling that the voluntary assignment of prizes will not affect the federal income tax treatment of prize winners who do not assign their prizes.))

(10) In the event that there is a dispute or it appears that a dispute may occur relative to any prize, the director may refrain from making payment of the prize pending a final determination by the director or by a court of competent jurisdiction relative to the same.

(11) A ticket that has been legally issued by a lottery retailer is a bearer instrument until signed. The person who signs the ticket or has possession of an unsigned ticket is considered the bearer of the ticket. Payment of any prize may be made to the bearer, and all liability of the state, its officials, officers, and employees and of the commission, director and employees of the commission terminates upon payment.

(12) All prizes shall be paid within a reasonable time after the claims are validated by the director and a winner is determined. Provided, prizes paid for claims validated pursuant to WAC 315-10-070(2) shall not be paid prior to one hundred eighty-one days after the official end of that instant game. The date of the first installment payment of each prize to be paid in installment payments shall be the date the claim is validated. Subsequent installment payments shall be made as follows:

(a) If the prize was awarded as the result of a drawing conducted by the lottery, installment payments shall be made weekly, monthly, or annually from the date of the drawing in accordance with the type of prize awarded, except that when a drawing occurs during the last week of the calendar year and it is impossible to claim the prize in the calendar year of the drawing solely due to weekend or extraordinary closure of the lottery's offices, installment payments shall be made weekly, monthly, or annually, in accordance with the type of prize awarded, from the date prize is claimed; or

(b) If the prize was awarded in a manner other than a drawing conducted by the lottery, installment payments shall be made weekly, monthly, or annually from the date the claim is validated in accordance with the type of prize awarded.

(13) The director may, at any time, delay any payment in order to review a change of circumstances relative to the prize awarded, the payee, the claim or any other matter that may have come to his or her attention. All delayed payments shall be brought up to date immediately upon the director's confirmation and continue to be paid on each originally scheduled payment date thereafter.

(14) If any prize is payable for the life of the winner, only a natural person may claim such a prize. Such "win for life" type prizes shall cease upon the death of the winner or the end of a guaranteed payment period (if any), whichever is later. Win for life prizes may be assigned; and the following conditions apply to such assignments:

(a) The original winner's actual life shall determine when prize payments cease; and

(b) The assignee shall be responsible for notifying the lottery of the original winner's death.

(15) The director's decisions and judgments in respect to the determination of a winning ticket or of any other dispute arising from the payment or awarding of prizes shall be final and binding upon all participants in the lottery.

(16) Each lottery retailer shall pay all prizes authorized to be paid by the lottery retailer by these rules during its normal business hours at the location designated on its license.

(17) In the event a dispute between the director and the claimant occurs as to whether the ticket is a winning ticket, and if the ticket prize is not paid, the director may, solely at his or her option, replace the disputed ticket with an unplayed ticket (or tickets of equivalent sales price from any game). This shall be the sole and exclusive remedy of the claimant.

[Statutory Authority: RCW 67.70.040. 96-19-071, 315-06-120, filed 9/17/96, effective 10/18/96; 96-15-124, 315-06-120, filed 7/24/96, effective 8/24/96; 94-19-062, 315-06-120, filed 9/20/94, effective 10/21/94; 93-04-004, 315-06-120, filed 1/21/93, effective 2/21/93; 91-03-036, 315-06-120, filed 1/9/91, effective 2/9/91; 89-12-042 (Order 116), 315-06-120, filed 6/1/89; 87-17-012 (Order 103), 315-06-120, filed 8/10/87; 87-01-057 (Order 96), 315-06-120, filed 12/16/86; 86-01-060 (Order 83), 315-06-120, filed 12/16/85; 85-16-031 (Order 77), 315-06-120, filed 7/30/85; 84-19-045 (Order 64), 315-06-120, filed 9/17/84; 84-09-008 (Order 54), 315-06-120, filed 4/9/84; 84-01-002 (Order 41), 315-06-120, filed 12/8/83. Statutory Authority: RCW 67.70.040 and 67.70.050. 83-05-029 (Order 14), 315-06-120, filed 2/10/83.]

AMENDATORY SECTION (Amending WSR 96-15-124, filed 7/24/96, effective 8/24/96)

WAC 315-06-123 Voluntary assignment of prize pursuant to an appropriate judicial order. (1) In the case of a voluntary assignment of a right to a prize pursuant to an appropriate judicial order, the director shall make payment to the person designated by a certified copy of the order which has been served upon the director personally or by certified mail provided that the order contains, in addition to the requirements set forth in RCW 67.70.100(2), the following provisions:

(a) The assignor's name. For an initial assignment, the winner's name as it appears on the prize claim form;

(b) The assignee's name;

(c) The citizenship or resident alien number of the assignee (if a natural person).

(2) The certified copy of the order must be served on the director at least twelve working days prior to the annual payment date to allow for a change in the payee. The director shall not be liable for failure to pay an annual payment to an assignee if service of the order and presentation of the required information for tax withholding purposes described in subsection (3) of this section is not timely made.

(3) Payment shall be made payable to the name of the assignee designated in the judicial order and to no other name and federal income tax withholding shall be deducted from each payment and reported to the Internal Revenue Service. The assignee shall provide its Social Security number, if a natural person, or tax identification number, if a legal entity, to the director at the time the judicial order is served for the purpose of reporting tax withholding to the Internal Revenue Service and for the purpose of applying the debt collection process as described in subsection (5) of this section.

(4) RCW 67.70.100 authorizes the director ((shall)) to charge actual costs for each assignment and deduct such costs ((shall be deducted)) from the initial annuity payment made to the assignee. In determining actual costs the director ((shall consider)) has considered the ((following expenses: (a))) staff time required to determine the sufficiency of the judicial order and to process the initial payment; (((b))) telegraphic and long distance telephone communications, photocopying, ((at the rate of ten cents per page,)) postage, and private delivery service; (((c))) and legal services directly related to determining the sufficiency of the judicial order and processing of the initial payment, including legal services and costs associated with any legal proceeding in which the agency is represented by the office of the attorney general. The director has determined the following costs shall be deducted from the initial annuity payment made to each assignee:

(a) Assignment of whole annuity payments (one or more years) resulting in payment only to the assignee during each year of the assignment: $250; or

(b) Assignment of a portion/percentage of annuity payments resulting in annual payments to one or more assignees and/or the original prize winner: $300 for the first year of the assignment, plus $75 for each year thereafter.

The director shall review these costs at least biennially from December 1, 1997, and shall recommend adjustments, if necessary, for commission consideration and approval.

(5) The debt collection process mandated by RCW 67.70.255 and WAC 315-06-125 shall be applied to all payments made to any person pursuant to a voluntary assignment. The term person shall have the same meaning as the definition set forth in WAC 315-02-180.