2023 -- H 6348

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LC002864

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2023

____________

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- VIDEO LOTTERY GAMES,

TABLE GAMES AND SPORTS WAGERING

     Introduced By: Representatives Costantino, Shallcross Smith, Edwards, Ackerman,
Cardillo, and O'Brien

     Date Introduced: April 28, 2023

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 42-61.2-1, 42-61.2-3.1, 42-61.2-4, 42-61.2-6, 42-61.2-9, 42-61.2-

11, 42-61.2-14 and 42-61.2-15 of the General Laws in Chapter 42-61.2 entitled "Video Lottery

Games, Table Games and Sports Wagering" are hereby amended to read as follows:

     42-61.2-1. Definitions.

     For the purpose of this chapter, the following words shall mean:

     (1) “2017 Budget Act” means 2017 — H 5175 Substitute A, as amended, entitled “An Act

Relating to Making Appropriations for the Support of the State for the Fiscal Year ending June 30,

2018,” which Act was signed into law by the Governor of Rhode Island on August 3, 2017.

     (2) "Bally's" means Bally's Corporation, a Delaware corporation.

     (3) “Casino gaming” means any and all table and casino-style games played with cards,

dice, or equipment, for money, credit, or any representative of value; including, but not limited to:

roulette, blackjack, big six, craps, poker, baccarat, paigow, any banking or percentage game, or any

other game or device included within the definition of Class III gaming as that term is defined in

Section 2703(8) of Title 25 of the United States Code and that is approved by the state through the

division of state lottery.

     (3)(4) “Central communication system” means a system approved by the Division, linking

all Video Lottery Terminals at a licensed video lottery retailer location to provide auditing program

information and any other information determined by the Division. In addition, the central

communications system must provide all computer hardware and related software necessary for the

establishment and implementation of a comprehensive system as required by the Division.

     (4)(5) “Collegiate sports or athletic event” shall not include a collegiate sports contest or

collegiate athletic event that takes place in Rhode Island or a sports contest or athletic event in

which any Rhode Island college team participates regardless of where the event takes place.

     (5)(6) “Consolidated promotional points program” means, collectively, the “Initial

Promotional Points Program” and the “Supplementary Promotional Points Program” applicable to

the Lincoln gaming facility and the “Initial Promotional Points Program” and the “Supplementary

Promotional Points Program” applicable to the Tiverton gaming facility, with each of the terms

“Initial Promotional Points Program” and “Supplementary Promotional Points Program” having

the meanings given such terms in the 2017 Budget Act.

     (6)(7) “Credit facilitator” means any employee of a licensed video lottery retailer approved

in writing by the Division whose responsibility is to, among other things, review applications for

credit by players, verify information on credit applications, grant, deny, and suspend credit,

establish credit limits, increase and decrease credit limits, and maintain credit files, all in

accordance with this chapter and rules and regulations approved by the Division.

     (7) (8) “DBR” means the department of business regulation, division of gaming and

athletics licensing, and/or and any successor in interest thereto.

     (8)(9) “Director” means the director of the Division.

     (9)(10) “Division” means the state lottery division of the department of revenue and/or any

successor in interest thereto.

     (10)(11) “Hosting facility” refers to the Lincoln gaming facility and the Tiverton gaming

facility.

     (12)(a) "iGaming" means casino gaming involving the placing of wagers of money or

something of monetary value for the opportunity to win money or something of monetary value on

a casino game, including, but not limited to, slot and table games, which game has been made

available to players through the use of the Internet through computers, mobile applications on

mobile devices, or other interactive devices approved by the Division, with wagers accepted by a

server-based gaming system located at a hosting facility. iGaming games may include, but are not

limited to, games involving digital versions of spinning reels or pay lines, and may include:

     (i) An auto play feature;

     (ii) An adjustable bet feature;

     (iii) A random number generator to determine the game outcome; and

     (iv) Games that can be played infinitely, using a nondepleting prize pool, offer prizes that

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are all available with every play, and have odds that remain the same with every play.

     (b) All wagers on iGaming games shall be deemed to be placed and accepted, and iGaming

games shall be deemed to be operated on the Division's behalf, at the premises of a hosting facility.

     (c) Notwithstanding the foregoing, the term "iGaming" does not include the following:

     (i) Sports wagering conducted under § 42-61.2-2.4;

     (ii) iLottery games;

     (iii) Pari-mutuel betting on the outcome of thoroughbred or harness horse racing, or

greyhound dog racing, including, but not limited to, pari-mutuel wagering on a race that is

"simulcast" (as defined in § 41-11-1), as regulated elsewhere pursuant to the general laws, including

in chapters 3, 3.1, 4, and 11 of title 41;

     (iv) Off-track betting on racing events, as regulated elsewhere pursuant to the general laws,

including in chapter 10 of title 41;

     (v) Wagering on the respective scores or points of the game of jai alai or pelota and the

sale of pari-mutuel pools related to such games, as regulated elsewhere pursuant to the general

laws, including in chapter 7 of title 41; and

     (vi) Lotteries, charitable gaming, games of chance, bingo games, raffles, and pull-tab

lottery tickets, to the extent permitted and regulated pursuant to chapter 19 of title 11.

     (13) "iGaming game vendor" means a Delaware limited company:

     (i) Owned in part by IGT (or by an entity controlling, controlled by or under common

control with IGT) and owned in the remaining part and controlled by (collectively) Twin River and

Twin River-Tiverton (or by an entity controlling, controlled by or under common control with Twin

River and Twin River- Tiverton), meaning that such controlling entities or entity possess, directly

or indirectly, the power to direct or cause the direction of the management and policies of the

iGaming game vendor, whether through the ownership of voting securities, by contract or

otherwise; and

     (ii) Authorized by the Division to be the exclusive provider of online slot games and online

table games to the Division in accordance with this chapter, such online slot games and online table

games being games owned or licensed by an owner of the iGaming game vendor (or by an entity

controlling, controlled by or under common control with such owner) or games owned or licensed

by a third party, that (in either case) are licensed to the iGaming game vendor for sublicense to the

Division.

     (14) "iGaming platform vendor" means an entity that owns or is the lessee under a long-

term lease of a hosting facility (or by an entity controlling, controlled by or under common control

with such an entity) and that is authorized by the Division to operate iGaming on the Division's

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behalf in accordance with this chapter.

     (11)(15) “IGT” means IGT Global Solutions Corporation, a Delaware corporation.

     (16) "iLottery game" means a traditional lottery game (such as daily numbers, Powerball

and Mega Millions) played online or a traditional instant ticket lottery game (for example, digital

simulations of physical instant ticket lottery games) made available to players through the use of

the Internet through computers, mobile applications on mobile devices, or other interactive devices

approved by the Division. iLottery games may include:

     (i) An auto play feature;

     (ii) An adjustable bet feature;

     (iii) A random number generator to determine the game outcome; and

     (iv) Games that can be played infinitely, using a nondepleting prize pool, offer prizes that

are all available with every play, and have odds that remain the same with every play.

     However, iLottery games shall not include games involving actual or digital versions of

spinning reels or pay lines.

     (12)(17) “Licensed video lottery retailer” means a pari-mutuel licensee specifically

licensed by the Director subject to the approval of the Division to become a licensed video lottery

retailer.

     (13)(18) “Lincoln gaming facility” means the gaming and entertainment facility located at

100 Twin River Road in the town of Lincoln, Rhode Island (sometimes referred to as “Twin River”

or the “Twin River gaming facility”).

     (14)(19) “Marketing Year” means the fiscal year of the state.

     (15)(20) “Net table-game revenue” means win from table games minus counterfeit

currency.

     (16)(21) “Net terminal income” means currency placed into a Video Lottery Terminal less

credits redeemed for cash by players.

     (17)(22) “Newport Grand” means Newport Grand, LLC, a Rhode Island limited-liability

company, successor to Newport Grand Jai Alai, LLC, and each permitted successor to and assignee

of Newport Grand, LLC under the Newport Grand Master Contract, including, without limitation,

Premier (as defined in subsection (25) of this section) and/or Twin River-Tiverton (as defined in

subsection (40) of this section) provided it is a pari-mutuel licensee (as defined in this section);

provided, further, however, where the context indicates that the term is referring to the physical

facility, then it shall mean the gaming and entertainment facility located at 150 Admiral Kalbfus

Road, Newport, Rhode Island.

     (18)(23) “Newport Grand Marketing Year” means each fiscal year of the state or a portion

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thereof between November 23, 2010, and the termination date of the Newport Grand Master

Contract.

     (19)(24) “Newport Grand Master Contract” means that certain master video lottery

terminal contract made as of November 23, 2005, by and between the division of lotteries of the

Rhode Island department of administration and Newport Grand, as amended and extended from

time to time as authorized therein and/or as such Newport Grand Master Contract may be assigned

as permitted therein.

     (20)(25) “Online gaming account” means an account opened by a patron that such patron

shall use for the deposit and withdrawal of funds used for online sports wagering., iGaming, or

both. An online gaming account may be used for both online sports wagering conducted under §

42-61.2-2.4 and iGaming, or a patron may have separate online gaming accounts for iGaming and

online sports wagering.

     (26) "Online slot game" means an online slot-machine-like game within the scope of the

term iGaming. Online slot games include, but are not limited to, online games involving digital

versions of spinning reels or pay lines, and may include:

     (i) An auto play feature;

     (ii) An adjustable bet feature;

     (iii) A random number generator to determine the game outcome; and

     (iv) Games that can be played infinitely, using a nondepleting prize pool, offer prizes that

are all available with every play, and have odds that remain the same with every play.

     (27) "Online slot gaming revenue" means:

     (i) The total of cash or cash equivalents received from the operation of online slot games

minus the total of:

     (A) Cash or cash equivalents paid to players as a result of the operation of online slot

games;

     (B) Marketing expenses related to online slot games as agreed to by the Division and the

iGaming platform vendor, as approved by the Division; and

     (C) Any federal excise taxes (if applicable).

     (ii) The term online slot gaming revenue does not include any of the following:

     (A) Counterfeit cash;

     (B) Coins or currency of other countries received as a result of the operation of online slot

games, except to the extent that the coins or currency are readily convertible to cash;

     (C) Cash taken in a fraudulent act perpetrated against the iGaming platform vendor for

which the iGaming platform vendor is not reimbursed;

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     (D) Free play provided by the iGaming platform vendor as authorized by the Division to a

player and subsequently "won back" by the iGaming platform vendor, for which the iGaming

platform vendor can demonstrate that it or its affiliate has not been reimbursed in cash.

     (28) "Online table game" means a casino-style table game within the scope of the term

iGaming. Online table games include, but are not limited to, games played with the digital

representation of cards, dice or equipment, such as, but not limited to, roulette, blackjack, big six,

craps, poker, baccarat, paigow and other banking and percentage games. Online table games

include, but are not limited to, online games involving digital versions of:

     (i) An adjustable bet feature;

     (ii) A random number generator to determine the game outcome; and

     (iii) Games that can be played infinitely, using a nondepleting prize pool, offer prizes that

are all available with every play, and have odds that remain the same with every play.

     (29) "Online table gaming revenue" means:

     (i) The total of cash or cash equivalents received from the operation of online table games

minus the total of:

     (A) Cash or cash equivalents paid to players as a result of the operation of online table

games;

     (B) Marketing expenses related to online table games as agreed to by the Division and the

iGaming platform vendor, as approved by the Division; and

     (C) Any federal excise taxes (if applicable).

     (ii) The term does not include any of the following:

     (A) Counterfeit cash;

     (B) Coins or currency of other countries received as a result of the operation of online table

games, except to the extent that the coins or currency are readily convertible to cash;

     (C) Cash taken in a fraudulent act perpetrated against the iGaming platform vendor for

which the iGaming platform vendor is not reimbursed;

     (D) Free play provided by the iGaming platform vendor as authorized by the Division to a

player and subsequently "won back" by the iGaming platform vendor, for which the iGaming

platform vendor can demonstrate that it or its affiliate has not been reimbursed in cash.

     (21)(30) “Online sports wagering” means engaging in the act of sports wagering by the

placing of wagers on sporting events or a combination of sporting events, or on the individual

performance statistics of athletes in a sporting event or a combination of sporting events, over the

internet through computers, mobile applications on mobile devices or other interactive devices

approved by the Division, which wagers are accepted by a server-based gaming system located at

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the premises of a hosting facility authorized to accept sports wagers and administer payoffs of

winning sports wagers; all such wagers shall be deemed to be placed and accepted at the premises

of a such hosting facility.

     (22)(31) “Online sports-wagering revenue” means:

     (i) The total of cash or cash equivalents received from online sports wagering minus the

total of:

     (I) Cash or cash equivalents paid to players as a result of online sports wagering;

     (II) Marketing expenses related to online sports wagering as agreed to by the Division, the

sports-wagering vendor, and the host facilities, as approved by the Division; and

     (III) Any federal excise taxes (if applicable).

     (ii) The term does not include any of the following:

     (I) Counterfeit cash.

     (II) Coins or currency of other countries received as a result of online sports wagering,

except to the extent that the coins or currency are readily convertible to cash.

     (III) Cash taken in a fraudulent act perpetrated against a hosting facility or sports-wagering

vendor for which the hosting facility or sports-wagering vendor is not reimbursed.

     (IV) Free play provided by the hosting facility or sports-wagering vendor as authorized by

the Division to a player and subsequently “won back” by the hosting facility or sports-wagering

vendor, for which the hosting facility or sports-wagering vendor can demonstrate that it or its

affiliate has not been reimbursed in cash.

     (23)(32) “Pari-mutuel licensee” means:

     (i) An entity licensed pursuant to § 41-3.1-3; and/or and

     (ii) An entity licensed pursuant to § 41-7-3.

     (24)(33) “Payoff,” when used in connection with sports wagering, means cash or cash

equivalents paid to a player as a result of the player’s winning a sports wager. A “payoff” is a type

of “prize,” as the term “prize” is used in chapters 61, 61.2, and 61.3 of this title.

     (25)(34) “Premier” means Premier Entertainment II, LLC and/or and its successor in

interest by reason of the acquisition of the stock, membership interests, or substantially all of the

assets of such entity.

     (26)(35) “Prior marketing year,” means, with respect to a marketing year, the most recent

previous marketing year during which the Division operated a majority of the authorized video

lottery games at each of the Lincoln gaming facility and the Tiverton gaming facility for at least

360 days (or 361 days in the case there are 366 days in such marketing year). For the avoidance of

doubt, because the Division will not have operated a majority of the authorized video lottery games

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at the Lincoln gaming facility and at the Tiverton gaming facility for at least 361 days during the

marketing year expiring on June 30, 2020, the prior marketing year with respect to the marketing

year expiring on June 30, 2021, shall be the marketing year expiring on June 30, 2019.

     (27)(36) “Promotional points” has the meaning given such term in the 2017 Budget Act.

     (28)(37) “Rake” means a set fee or percentage of cash and chips representing cash wagered

in the playing of a nonbanking table game assessed by a table games retailer for providing the

services of a dealer, gaming table, or location, to allow the play of any nonbanking table game.

     (29)(38) “Server-based gaming system” means all hardware, software, and

communications devices that comprise a system utilized for the purpose of offering an electronic

platform used in connection with the process of iGaming or placing and accepting sports wagers,

or both iGaming and placing and accepting sports wagers.

     (30)(39) “Sporting event” means any professional sport or athletic event, any Olympic or

international sports competition event, and any collegiate sport or athletic event, or any portion

thereof, including, but not limited to, the individual performance statistics of athletes in a sports

event or combination of sports events, except “sporting event” shall not include a prohibited

sporting event.

     (31)(40) “Sports wagering” means the business of accepting wagers on sporting events or

a combination of sporting events, or on the individual performance statistics of athletes in a sporting

event or combination of sporting events, by any system or method of wagering. The term includes,

but is not limited to, exchange wagering, parlays, over-under, moneyline, pools, and straight bets,

and the term includes the placement of such bets and wagers. However, the term does not include,

without limitation, the following:

     (i) Lotteries, including video lottery games and other types of casino gaming operated by

the state, through the Division, as of June 22, 2018.

     (ii) Pari-mutuel betting on the outcome of thoroughbred or harness horse racing, or

greyhound dog racing, including but not limited to, pari-mutuel wagering on a race that is

“simulcast” (as defined in § 41-11-1), as regulated elsewhere pursuant to the general laws,

including in chapters 3, 3.1, 4, and 11 of title 41.

     (iii) Off-track betting on racing events, as regulated elsewhere pursuant to the general laws,

including in chapter 10 of title 41.

     (iv) Wagering on the respective scores or points of the game of jai alai or pelota and the

sale of pari-mutuel pools related to such games, as regulated elsewhere pursuant to the general

laws, including in chapter 7 of title 41.

     (v) Lotteries, charitable gaming, games of chance, bingo games, raffles, and pull-tab lottery

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tickets, to the extent permitted and regulated pursuant to chapter 19 of title 11.

     (iv) iGaming (as defined in this section).

     (32)(41) “Sports-wagering device” means any mechanical, electrical, or computerized

contrivance, terminal, machine, or other device, apparatus, equipment, or supplies approved by the

Division and used to conduct sports wagering.

     (33)(42) “Sports-wagering revenue” means:

     (i) The total of cash or cash equivalents received from sports wagering minus the total of:

     (I) Cash or cash equivalents paid to players as a result of sports wagering;

     (II) The annual flat fee to the host communities as defined by § 42-61.2-5(c);

     (III) Marketing expenses related to sports wagering as agreed to by the Division, the sports-

wagering vendor, and the host facilities, as approved by the Division; and

     (IV) Any federal excise taxes (if applicable).

     (ii) The term does not include any of the following:

     (I) Counterfeit cash.

     (II) Coins or currency of other countries received as a result of sports wagering, except to

the extent that the coins or currency are readily convertible to cash.

     (III) Cash taken in a fraudulent act perpetrated against a hosting facility or sports-wagering

vendor for which the hosting facility or sports-wagering vendor is not reimbursed.

     (IV) Free play provided by the hosting facility or sports-wagering vendor as authorized by

the Division to a patron and subsequently “won back” by the hosting facility or sports-wagering

vendor, for which the hosting facility or sports-wagering vendor can demonstrate that it or its

affiliate has not been reimbursed in cash.

     (34)(43) “Sports-wagering vendor” means any entity authorized by the Division to operate

sports betting on the Division’s behalf in accordance with this chapter.

     (35)(44) “Table game” or “Table gaming” means that type of casino gaming in which table

games are played in person (i.e., physically present) at a hosting facility for cash or chips

representing cash, or any other representation of value that has been approved by the Division,

using cards, dice, or equipment and conducted by one or more live persons.

     (36)(45) “Table-game retailer” means a retailer authorized to conduct table gaming

pursuant to § 42-61.2-2.1 or § 42-61.2-2.3.

     (37)(46) “Technology provider” means any individual, partnership, corporation, or

association that designs, manufactures, installs, maintains, distributes, or supplies Video Lottery

Terminals or associated equipment for the sale or use in this state.

     (38)(47) “Tiverton gaming facility” means the gaming and entertainment facility located

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at the intersection of William S. Canning Boulevard and Stafford Road in the town of Tiverton,

Rhode Island (sometimes referred to as “Twin River-Tiverton”).

     (39)(48) “Twin River” (sometimes referred to as “UTGR”) means UTGR, Inc., a Delaware

corporation, and each permitted successor to and assignee of UTGR, Inc.; provided, however,

where the context indicates that the term is referring to a physical facility, then “Twin River” shall

mean the Lincoln gaming facility.

     (40)(49) “Twin River-Tiverton” means Twin River-Tiverton, LLC and/or and its successor

in interest by reason of the acquisition of the stock, membership interests, or substantially all of the

assets of such entity; provided, however, where the context indicates that the term is referring to a

physical facility, then “Twin River-Tiverton” shall mean the Tiverton gaming facility.

     (41)(50) “Twin River-Tiverton Marketing Year” has the same meaning as Marketing Year

(as defined in subsection (14) of this section).

     (42)(51) “Twin River-Tiverton Master Contract” has the same meaning as Newport Grand

Master Contract (as defined in subsection (19) of this section).

     (43)(52) “UTGR Master Contract” means that certain master video lottery terminal

contract made as of July 1, 2005, by and between the division of lotteries of the Rhode Island

department of administration (now the division of lotteries of the Rhode Island department of

revenue) and Twin River, as amended and extended from time to time as authorized therein and/or

and as such UTGR Master Contract may be assigned as permitted therein.

     (44)(53) “Video Lottery Agreement” means that certain Video Lottery Central Computer

System Agreement dated as of December 20, 2001, by and between IGT and the Division, as

amended, extended, assigned, and assumed from time to time.

     (45)(54) “Video lottery games” means lottery games played on Video Lottery Terminals

controlled by the Division.

     (46)(55) “Video lottery terminal” means any electronic computerized video game machine

that, upon the insertion of cash or any other representation of value that has been approved by the

Division, is available to play a video game authorized by the Division, and that uses a video display

and microprocessors in which, by chance, the player may receive free games or credits that can be

redeemed for cash. The term does not include a machine that directly dispenses coins, cash, or

tokens or any device that uses the Internet, including, but not limited to, computers and mobile

devices, unless the video lottery terminal player must be physically present at the device at the

hosting facility to place wagers on the device.

     (47)(56) “VLT Agreement” means that certain Video Lottery Terminal Technology

Provider License Agreement dated as of September 28, 2000, by and between IGT and the Division,

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as amended, extended, assigned, and assumed from time to time.

     (57) "VLT Joint Venture" means Rhode Island VLT Company LLC, a Delaware limited

liability company, the current members of which are IGT, Twin River and Twin River-Tiverton.

     42-61.2-3.1. Table-game regulation Table-game regulation and regulation of

iGaming.

     (a) In addition to the powers and duties of the Division director under §§ 42-61-4, 42-61.2-

3 and 42-61.2-4, and pursuant to § 42-61.2-2.1 and § 42-61.2-2.2, the Division director shall

promulgate reasonable rules and regulations relating to state-operated table gaming and state-

operated iGaming and set policy for these table games. These rules and regulations shall include,

but not be limited to:

     (1) Establishing standards and procedures for table gaming and associated equipment.

     (2) Establishing standards, rules and regulations to govern the conduct of table games and

the system of wagering associated with table games, including without limitation:

     (i) The object of the table game and method of play, including what constitutes win, loss

or tie bets;

     (ii) Physical characteristics of the table games and table-game equipment;

     (iii) Wager and payout odds for each type of available wager;

     (iv) The applicable inspection procedures for any of the following, as required by a table

game:

     (A) Cards;

     (B) Dice;

     (C) Wheels and balls; and

     (D) Other devices, equipment and accessories related to table games.

     (v) Procedures for the collection of bets and payouts, including requirements for internal

revenue service purposes;

     (vi) Procedures for handling suspected cheating or table-gaming irregularities; and

     (vii) Procedures for handling any defective or malfunctioning table-game equipment.

     (3) Establishing the method for calculating net table-game revenue and standards for the

daily counting and recording of cash received in the conduct of table games, and ensuring that

internal controls are followed, including the maintenance of financial books and records and the

conduct of annual audits at the expense of the table game retailer.

     (4) Establishing the number and type of table games authorized at a table-game retailer’s

facility, and all rules related thereto.

     (5) Establishing any table-game rule changes, table-game minimum and maximum wager

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changes, and changes to the type of table game being offered at a particular gaming table, including

any notice by the table-game retailer to the public.

     (6) Requiring the table-game retailer to:

     (i) Provide written information at each table game about game rules, payoffs or winning

wagers and other information as the Division may require.

     (ii) Provide specifications approved by the Division to integrate and update the table-game

retailer’s surveillance system to cover all areas where table games are conducted and other areas as

required by the lottery division. The specifications shall include provisions providing the Division

and other persons authorized by the Division with onsite access to the system.

     (iii) Designate one or more locations within the table-game retailer’s facility to conduct

table games.

     (iv) Ensure that visibility in a table-game retailer’s facility is not obstructed in any way that

could interfere with the ability of the Division, the table-game retailer or other persons authorized

under this section or by the Division to oversee the surveillance of the conduct of table games.

     (v) Ensure that the count room for table gaming has appropriate security for the counting

and storage of cash.

     (vi) Furnish each table game with a sign acceptable to the division indicating the

permissible minimum and maximum wagers at the table game.

     (vii) Adopt policies or procedures to prohibit any table-game equipment from being

possessed, maintained or exhibited by any person on the premises of a table-game retailer’s facility

except in the areas of such facility where the conduct of table games is authorized or in a restricted

area designated to be used for the inspection, service, repair or storage of table-game equipment by

the table-game retailer or in an area used for employee training and instruction by the table-game

retailer.

     (viii) Ensure that drop boxes are brought into or removed from an area where table games

are conducted or locked or unlocked in accordance with procedures established by the Division.

     (ix) Designate secure locations for the inspection, service, repair or storage of table-game

equipment and for employee training and instruction to be approved by the Division.

     (7) Establishing the size and uniform color by denomination of table-game chips used in

the conduct of table games, including tournaments, and a policy for the use of promotional or

commemorative chips used in the conduct of certain table games. All types of table-game chips

shall be approved by the Division prior to being used for play at a table game.

     (8) Establishing the procedure to be used by a table-game retailer to determine and extract

a rake for the purposes of generating net, table-game revenue from nonbanking games.

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     (9) Establishing minimum standards relating to the acceptance of tips or gratuities by

dealers at a table game, which shall include:

     (i) The requirement that tips or gratuities accepted by dealers at banking table games be

placed in a common pool for complete distribution pro rata among all dealers based on the daily

collection of such tips or gratuities; provided however, the Division may establish an alternative

distribution method for tips or gratuities at a banking table game upon submission by the table-

game retailer of a proposal acceptable to the division to modify the existing distribution method for

tips or gratuities.

     (ii) The requirement that tips or gratuities accepted by dealers at nonbanking table games

are not required to be pooled and may be retained by the dealers; provided however, the Division

may establish an alternative distribution method for tips or gratuities at a nonbanking table game

upon submission by the table-game retailer of a proposal acceptable to the division to modify the

existing distribution method for tips or gratuities.

     (10) Establishing the minimal proficiency requirements for table-game personnel,

including without limitation table-game dealers. The foregoing requirements of this subsection (10)

shall not affect any rules or regulations of the Rhode Island Department of Business Regulation

requiring licensing of personnel of state-operated gaming facilities.

     (11) Establishing the practices and procedures governing the conduct of table-game

tournaments.

     (12) Establishing appropriate eligibility requirements and standards for traditional table-

game equipment suppliers.

     (13) Any other matters necessary for conducting table games.

     (b) The Division shall promulgate the table-game regulations authorized by this section on

or before March 31, 2013.

     (c) A table-game retailer shall reimburse and pay to the Division (or to such other entities

as the Division may identify) all reasonable costs and expenses associated with the Division’s

review of the business or operations of the table-game retailer, including, but not limited to, such

items as ongoing auditing, legal, investigation services, compulsive and problem gambling

programs, and other related matters.

     (d) The table-game retailer shall provide secure, segregated facilities as required by the

Division on the premises for the exclusive use of the Lottery staff and the State Police. Such space

shall be located proximate to the gaming floor and shall include surveillance equipment, monitors

with full camera control capability, as well as other office equipment that may be deemed necessary

by the Division. The location and size of the space shall be subject to the approval of the Division.

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     (e) In addition to the powers and duties of the Division director in this section and those

under §§ 42-61-4, 42-61.2-3 and 42-61.2-4, and pursuant to §§ 42-61.2-2.1 and 42-61.2- 2.2, the

Division director shall promulgate reasonable rules and regulations relating to state-operated

iGaming and set policy for such gaming. Such rules and regulations shall include, but not be limited

to:

     (1) Standards, rules, and regulations to govern the conduct of iGaming, including, without

limitation:

     (i) Procedures for investigation of patron complaints related to iGaming;

     (ii) Terms and conditions for iGaming;

     (iii) Internal controls for all aspects of iGaming, including procedures for system integrity,

system security, operations, accounting, and reporting of problem gamblers;

     (iv) Operational controls for server-based gaming systems, software, and hardware utilized

for iGaming, including, but not limited to, appearance, functionality, contents, collection, storage,

and retention of data and security; and

     (v) Operational controls for online gaming accounts, including, but not limited to,

procedures for the establishment and closure of an online gaming account, funding of withdrawal

of funds from an online gaming account, and generation of an account statement for a patron's

online gaming account;

     (2) Establishing the method for calculating online slot gaming revenue and online table

gaming revenue and standards for the daily counting and recording of cash and cash equivalents

received in the conduct of online slot games and online table games, and ensuring that internal

controls are followed and financial books and records are maintained and audits are conducted; and

     (3) Requiring the iGaming platform vendor to provide written information prominently

displayed on any electronic platform available to the patron through a server-based gaming system,

regarding wagering rules, payoffs on winning wagers, deposits, withdrawals, and other information

as the Division may require.

     42-61.2-4. Additional powers and duties of director and lottery division.

     In addition to the powers and duties set forth in §§ 42-61-4 and 42-61.2-3, the director shall

have the power to:

     (1) Supervise and administer the operation of video lottery games and, sports wagering,

and casino gaming (including iGaming) in accordance with this chapter and with the rules and

regulations of the division;

     (2) Suspend or revoke upon a hearing any license issued pursuant to this chapter or the

rules and regulations promulgated under this chapter;

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     (3) In compliance with the provisions of chapter 2 of title 37, enter into contracts for the

operation of a central communications system and technology providers, or any part thereof;

     (4) In compliance with the provisions of chapter 2 of title 37, enter into contracts for the

provision of sports-wagering systems, facilities, and related technology necessary and/or or

desirable for the state-operated sports wagering and state-operated iGaming to be hosted at Twin

River and the Tiverton gaming facilities, including technology related to the operation of on-

premises remote sports wagering, or any part thereof;

     (5) In compliance with the provisions of chapter 2 of title 37, enter into contracts for the

provision of server-based gaming systems, facilities, and related technology necessary and/or or

desirable for the state-operated online sports wagering; and

     (6) In compliance with the provisions of chapter 2 of title 37, enter into contracts for the

provision of server-based gaming systems, facilities, and related technology necessary or desirable

for state-operated iGaming;

     (7) Notwithstanding any provisions of the general laws or regulations adopted thereunder

to the contrary, including, without limitation, the provisions of chapter 2 of title 37, chapter 61 of

title 42, and chapter 64 of title 42, enter into a contract with the iGaming game vendor pursuant to

which the iGaming game vendor will be the exclusive provider of online slot games and online

table games to the Division, such online slot games and online table games being games owned or

licensed by an owner of the iGaming game vendor (or by an entity controlling, controlled by or

under common control with such owner) or games owned or licensed by a third party, that (in either

case) are licensed to the iGaming game vendor for sublicense to the Division; and

     (6)(8) Certify monthly to the budget officer, the auditor general, the permanent joint

committee on state lottery, and to the governor a full and complete statement of lottery revenues,

prize disbursements, and other expenses for the preceding month; ensure that monthly financial

reports are prepared providing gross monthly revenues, prize disbursements, other expenses, and

net income for keno and for all other lottery operations; submit this report to the state budget officer,

the auditor general, the permanent joint committee on state lottery, the legislative fiscal advisors,

and the governor no later than the twentieth business day following the close of the month; at the

end of each fiscal year the director shall submit an annual report based upon an accrual system of

accounting that shall include a full and complete statement of lottery revenues, prize disbursements,

and expenses, to the governor and the general assembly, which report shall be a public document

and shall be filed with the secretary of state. The monthly report shall be prepared in a manner

prescribed by the members of the revenue estimating conference.

     42-61.2-6. When games may be played.

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     (a) Video lottery games authorized by this chapter may be played at the licensed video

lottery retailer’s facilities with the approval of the division, even if that facility is not conducting a

pari-mutuel event.

     (b) Sports wagering authorized by this chapter, including accepting sports wagers and

administering payoffs of winning sports wagers, may be conducted at the Twin River and the

Tiverton gaming facilities, with the approval of the division, even if that facility is not conducting

a pari-mutuel event.

     (c) Casino gaming (including iGaming) authorized by this chapter and including accepting

wagers and administering payoffs of winning wagers on casino gaming, online slot games and

online table games, may be conducted at the Twin River and the Tiverton gaming facilities, with

the approval of the Division, even if that facility is not conducting a pari-mutuel event.

     42-61.2-9. Unclaimed prize money, including unclaimed sports-wagering payoffs.

     Unclaimed prize money for prizes in connection with the play of a video lottery game,

casino game, online slot game or online table game, and an unclaimed payoff in connection with a

sports wager shall be retained by the director for the person entitled thereto for one year after,

respectively, the completion of the applicable video lottery game, casino game, online slot game or

online table game, or the determination of the result of the sporting event that was the subject of

the applicable sports wager. If no claim is made for the prize money or payoff within that year, the

prize money or payoff shall automatically revert to the lottery fund and the winner shall have no

claim thereto.

     42-61.2-11. Effect of other laws and local ordinances.

     (a) No other law providing any penalty or disability for operating, hosting, maintaining,

supporting, or playing video lottery games, or any acts done in connection with video lottery games,

shall apply to operating, hosting, maintaining, supporting, or playing video lottery games pursuant

to this chapter.

     (b) No other law providing any penalty or disability for conducting, hosting, maintaining,

supporting, or participating in sports wagering, or any acts done in connection with sports wagering,

shall apply to conducting, hosting, maintaining, supporting, or participating in sports wagering

pursuant to this chapter.

     (c) No other law providing any penalty or disability for conducting, hosting, maintaining,

supporting, or participating in casino gaming, including iGaming, or any acts done in connection

with casino gaming, including iGaming, shall apply to conducting, hosting, maintaining,

supporting, or participating in casino gaming, including iGaming pursuant to this chapter.

     (c)(d) The provisions of §§ 41-9-4 and 41-9-6 shall not apply to this chapter, and the

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provisions of this chapter shall take precedence over any local ordinances to the contrary. It is

specifically acknowledged that the installation, operation, and use of video lottery terminals by a

pari-mutuel licensee, as authorized in this chapter, shall for all purposes be deemed a permitted use

as defined in § 45-24-31. No city or town where video lottery terminals are authorized may seek to

prevent the installation and use of said video lottery terminals by defining such as a prohibited use.

     42-61.2-14. Compulsive and problem gambling programs.

     The Division and the state acknowledge that the vast majority of gaming patrons can enjoy

gambling games responsibly, but that there are certain societal costs associated with gaming by

some individuals who have problems handling the product or services provided. The Division and

the State further understand that it is their duty to act responsibly toward those who cannot

participate conscientiously in gaming. Pursuant to the foregoing, Twin River and Twin River-

Tiverton, in cooperation with the State, shall offer compulsive and problem gambling programs

that include, but are not limited to (a) Problem gambling awareness programs for employees; (b)

Player self-exclusion program; and (c) Promotion of a problem gambling hotline. Twin River and

Twin River-Tiverton shall modify their existing compulsive and problem gambling programs to

include table games, and sports wagering and iGaming to the extent such games are authorized at

such facilities or through the Internet or a mobile application. Twin River and Twin River-Tiverton

shall reimburse and pay to the Division no less than two hundred thousand dollars ($200,000) in

aggregate annually for compulsive and problem gambling programs established by the Division.

The contribution from each facility shall be determined by the Division. A person who is prohibited

from gaming in a gaming establishment due to the player self-exclusion program shall not collect

any winnings or recover losses arising as a result of prohibited gaming activity by said person.

Winnings from a self-excluded person, after the deduction of taxes and other applicable

withholdings, shall be forfeited to the division. The division shall forward such forfeited winnings,

up to one hundred fifty thousand dollars ($150,000) per year, to the Rhode Island Council on

Problem Gambling for its use for research, education, and prevention of teenage gambling

addiction, with the balance to be transferred by the division to the general fund.

     42-61.2-15. Table game and sports-wagering hours of operation Table game, sports-

wagering, and iGaming hours of operation.

     (a) To the extent table games are authorized at the premises of a table-game retailer, such

table games may be offered at the premises of a table-game retailer for all or a portion of the days

and times that video lottery games are offered.

     (b) To the extent sports wagering is authorized at the premises of a table-game retailer,

such sports wagering may be offered at the premises of such table-game retailer for all or a portion

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of the days and times that video lottery games are offered.

     (c) To the extent online sports wagering is authorized at a hosting facility, such online

sports wagering may be offered without any restriction on hours of operation and shall not be

limited by the days and times that video lottery games and/or or table games are offered.

     (d) To the extent iGaming is authorized at a hosting facility, such iGaming may be offered

without any restriction on hours of operation and shall not be limited by the days and times that

video lottery games or table games are offered.

     SECTION 2. Chapter 42-61.2 of the General Laws entitled "Video Lottery Games, Table

Games and Sports Wagering" is hereby amended by adding thereto the following sections:

     42-61.2-5.1. Allocation of online slot gaming revenue.

     (a) Notwithstanding the provisions of § 42-61-15, the division of lottery is authorized to

enter into an agreement to allocate online slot gaming revenue among the state, the state's

authorized iGaming platform vendor, and the state's authorized iGaming game vendor.

     (b) The allocation of online slot gaming revenue shall be as follows:

     (1) To the state, fifty percent (50%) of online slot gaming revenue;

     (2) To the state's authorized iGaming platform vendor, thirty-five percent (35%) of online

slot gaming revenue; and

     (3) To the state's authorized iGaming game vendor fifteen percent (15%) of online slot

gaming revenue.

     (c) Online slot gaming revenue allocated to the state shall be deposited into the state lottery

fund for administrative purposes and then the balance remaining into the general fund.

     42-61.2-5.2. Allocation of online table gaming revenue.

     (a) Notwithstanding the provisions of § 42-61-15, the division of lottery is authorized to

enter into an agreement to allocate online table gaming revenue among the state, the state's

authorized iGaming platform vendor, and the state's authorized iGaming game vendor.

     (b) The allocation of online table gaming revenue shall be:

     (1) To the state, eighteen percent (18%) of online table gaming revenue;

     (2) To the state's authorized iGaming platform vendor, thirty-five percent (35%) of online

table gaming revenue; and

     (3) To the state's authorized iGaming game vendor, forty-seven percent (47%) of online

table gaming revenue.

     (c) Online table gaming revenue allocated to the state shall be deposited into the state

lottery fund for administrative purposes and then the balance remaining into the general fund.

     42-61.2-17. General requirements for iGaming.

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     (a) Wagers in connection with iGaming shall only be initiated, received or otherwise made

within the State of Rhode Island. The iGaming platform vendor shall only accept wagers in

connection with iGaming from players who have been affirmatively located as being physically

present in the State of Rhode Island at the time of their wager.

     (b) Geolocation technology shall be used in connection with iGaming to detect the physical

location of a player at the time the player is wagering, and as frequently as specified in any

regulations promulgated by the state, through the Division. If the geolocation technology detects

that the physical location of the patron at the time the player is wagering is in an area outside the

State of Rhode Island, or if it cannot detect the physical location of the patron, the system shall not

accept that patron's wagers until such time as the patron is determined to be physically located in

the State of Rhode Island.

     (c) The server-based gaming system used to process wagers in connection with iGaming,

and any other hardware, software, and other technology or equipment located on a hosting facility's

premises and used in connection with iGaming, shall be located in a restricted area on the hosting

facility's premises.

     (d) The hardware, software and other technology and equipment used by the iGaming game

vendor and its suppliers do not need to be located in the State of Rhode Island.

     (e) iGaming shall only be engaged in by patrons who have established an online gaming

account pursuant to the rules and regulations promulgated by the Division.

     42-61.2-18. Acceptance of out-of-state iGaming.

     (a) Notwithstanding any other provision of law to the contrary, wagers may be accepted

under this chapter from persons who are not physically present in Rhode Island if the Division has

determined that:

     (1) Accepting the wagers is not inconsistent with federal law and not inconsistent with the

law of the jurisdiction in which the person placing the wagers is located; or

     (2) The wagering is conducted pursuant to a reciprocal agreement to which Rhode Island

is a party that is not inconsistent with federal law.

     (b) The Division may enter into an interactive gaming reciprocal agreement with a

regulatory agency of one or more other states or jurisdictions in which interactive gaming is

authorized to allow an interactive gaming operator to accept wagers from persons not physically

present in Rhode Island, and to allow persons physically present in Rhode Island to place wagers

with parties to the interactive gaming reciprocal agreement, if the reciprocal agreement is not

inconsistent with federal law and is approved by the governor.

     SECTION 3. This act shall take effect on January 1, 2024.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- VIDEO LOTTERY GAMES,

TABLE GAMES AND SPORTS WAGERING

***

     This act would legalize iGaming by patrons located in the State of Rhode Island.

     This act would take effect on January 1, 2024.

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