Chapter 236

2005 -- S 0551 AS AMENDED

Enacted 07/09/05

 

A N A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- STATE LOTTERY

     

     

     Introduced By: Senators Bates, Damiani, and Goodwin

     Date Introduced: February 10, 2005

 

 

It is enacted by the General Assembly as follows:

 

     SECTION 1. Sections 42-61-1, 42-61-3, 42-61-4, 42-61-5, 42-61-6, 42-61-8, 42-61-10,

42-61-12 and 42-61-15 of the General Laws in Chapter 42-61 entitled "State Lottery" are hereby

amended to read as follows:

 

     42-61-1. Lottery commission established. –Division of state lottery established. -- (a)

There is established a state lottery division within the department of administration. commission

which shall consist of nine (9) members, all of whom shall be citizens and residents of this state;

three (3) of whom shall be members of the senate, not more than two (2) from the same political

party to be appointed by the president of the senate; three (3) of whom shall be members of the

house of representatives, not more than two (2) from the same political party to be appointed by

the speaker of the house; and three (3) of whom shall be representatives of the general public to

be appointed by the governor.

      (b) The members shall be appointed for terms of three (3) years except for the three (3)

members originally appointed by each of the appointing authorities; one shall be appointed for a

term of one year, one shall be appointed for a term of two (2) years and one for a term of three (3)

years. The members shall annually elect one of them as chairperson of the commission.

      (c) Any vacancy on the commission, occurring for any reason prior to the expiration of

the term, including but not limited to termination of active membership in the general assembly,

shall be filled for the unexpired term by the appointing authority in the same manner as the

original appointment.

      (d) Any member of the commission may, for cause, be summarily removed from office

by the appointing authority, which removal shall be subject to judicial review by the superior

court and pending that review the member shall not carry out any duties as a commission

member.

      (e) The members of the commission shall receive no salaries but shall be allowed

reasonable expenses in the performance of their official duties.

 

     42-61-3. Appointment of director of lotteries. -- The lotteries shall be under the

immediate supervision and direction of a director, who shall be a qualified person to administer

an enterprise of the nature of a lottery. The director shall be appointed by the governor to a five

(5) year term with the advice and consent of the senate. The appointment shall be reviewed or

vetted by the Permanent Joint Committee on State Lottery according to Article 6 Section 15 of

the Rhode Island Constitution. with the majority approval of the commission and shall serve at

the pleasure of the commission. The director shall serve until his or her successor is appointed

and qualified. Any vacancy occurring in the office of the director shall be filled in the same

manner as the original appointment. Pursuant to section 42-6-4 of the Rhode Island general laws,

in the case of a vacancy while the senate is not in session, the governor shall appoint a director to

hold the office until the next session thereof; provided, that no person should serve in such a

position for more than three (3) legislative days after the senate convenes unless that person's

name shall have been submitted to the senate for its approval. The director shall devote his or her

entire time and attention to the duties of his or her office and shall not be engaged in any other

profession or occupation. He or she shall receive any salary that the director of the department of

administration commission shall determine and shall be in the unclassified service.

     The Director of Lotteries shall be removable by the governor, pursuant to the provisions

of section 36-1-7 of the general laws and for cause only, and removal solely for partisan or

personal reasons unrelated to capacity or fitness for the office shall be unlawful.

 

     42-61-4. Powers and duties of director. -- The director shall have the power and it shall

be his or her duty to:

      (1) Supervise and administer the operation of lotteries in accordance with this chapter,

chapter 61.2 and with the rules and regulations of the commission division;

      (2) Act as the chief administrative officer having general charge of the office and records

and to employ temporarily subject to the approval of the commission, necessary personnel to

serve at his pleasure and who shall be in the unclassified service and whose salaries shall be set

by the commission director of the department of administration;, pursuant to the provisions of

section 36-4-16 of the general laws.

      (3) Act as executive secretary of the commission;

      (4) (3) In accordance with this chapter and the rules and regulations of the commission

division, license as agents to sell lottery tickets those persons, as in his or her opinion, who will

best serve the public convenience and promote the sale of tickets or shares. The director may

require a bond from every licensed agent, in an amount provided in the rules and regulations of

the commission of the division. Every licensed agent shall prominently display his or her license,

or a copy of their license, as provided in the rules and regulations of the commission of the

committee;

      (5) (4) Confer regularly as necessary or desirable, and not less than once each month,

with the commission permanent joint committee on state lottery on the operation and

administration of the lotteries; make available for inspection by the commission committee, upon

request, all books, records, files, and other information, and documents of the commission

division; advise the commission committee and recommend those matters that he or she deems

necessary and advisable to improve the operation and administration of the lotteries;

      (6) (5) Recommend to the commission that it suspend Suspend or revoke any license

issued pursuant to this chapter, chapter 61.2 or the rules and regulations promulgated under this

chapter and chapter 61.2;

      (7) (6) Subject to the approval of the commission, enter Enter into contracts for the

operation of the lotteries, or any part of the operation of the lotteries, and into contracts for the

promotion of the lotteries. No contract awarded or entered into by the director may be assigned

by the holder except by specific written approval of the commission;

      (8) (7) Ensure that monthly financial reports are prepared providing gross monthly

revenues, prize disbursements, other expenses, net income, and the amount transferred to the state

general fund for keno and for all other lottery operations; submit this report to the state budget

officer, the auditor general, the commission 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; the monthly report shall be prepared in a manner prescribed by the members

of the revenues estimating conference; at the end of each fiscal year the director shall submit an

annual report based upon an accrual system of accounting which 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;

      (9) (8) Carry on a continuous study and investigation of the state lotteries throughout the

state, and the operation and administration of similar laws which may be in effect in other states

or countries; and

      (10) (9) Implement the creation and sale of commercial advertising space on lottery

tickets as authorized by section 42-61-2 42-61-4 of this chapter as soon as practicable after June

22, 1994.

     (10) Promulgate rules and regulations which shall include but not be limited to:

     (i) The price of tickets or shares in the lotteries;

     (ii) The number and size of the prizes on the winning tickets or shares;

     (iii) The manner of selecting the winning tickets or shares;

     (iv) The manner of payment of prizes to the holders of winning tickets or shares;

      (v) The frequency of the drawings or selections of winning tickets or shares;

      (vi) The number and types of location at which tickets or shares may be sold;

      (vii) The method to be used in selling tickets or shares;

      (viii) The licensing of agents to sell tickets or shares, except that a person under the age

of eighteen (18) shall not be licensed as an agent;

      (ix) The license fee to be charged to agents;

      (x) The manner in which the proceeds of the sale of lottery tickets or shares are

maintained, reported, and otherwise accounted for;

      (xi) The manner and amount of compensation to be paid licensed sales agents necessary

to provide for the adequate availability of tickets or shares to prospective buyers and for the

convenience of the general public;

      (xii) The apportionment of the total annual revenue accruing from the sale of lottery

tickets or shares and from all other sources for the payment of prizes to the holders of winning

tickets or shares, for the payment of costs incurred in the operation and administration of the

lotteries, including the expense of the division and the costs resulting from any contract or

contracts entered into for promotional, advertising, consulting, or operational services or for the

purchase or lease of facilities, lottery equipment, and materials, for the repayment of moneys

appropriated to the lottery fund;

      (xiii) The superior court upon petition of the director after a hearing may issue

subpoenas to compel the attendance of witnesses and the production of documents, papers, books,

records, and other evidence in any matter over which it has jurisdiction, control or supervision. If

a person subpoenaed to attend in the proceeding or hearing fails to obey the command of the

subpoena without reasonable cause, or if a person in attendance in the proceeding or hearing

refuses without lawful cause to be examined or to answer a legal or pertinent question or to

exhibit any book, account, record, or other document when ordered to do so by the court, that

person may be punished for contempt of the court;

      (xiv) The manner, standards, and specification for a process of competitive bidding for

division purchases and contracts; and

      (xv) The sale of commercial advertising space on the reverse side of, or in other

available areas upon, lottery tickets provided that all net revenue derived from the sale of the

advertising space shall be deposited immediately into the state's general fund and shall not be

subject to the provisions of section 42-61-15.

 

     42-61-5. Sales agents. -- (a) For the purpose of this chapter, the term "person" shall be

construed to mean and include an individual, association, partnership, corporation, trust, estate,

company, receiver, trustee, referee, or other person acting in a fiduciary or representative

capacity, whether appointed by a court or otherwise, and any combination of individuals.

"Person" shall be construed to mean all departments, committees, commissions, agencies, and

instrumentalities of the state, including counties and municipalities and agencies and

instrumentalities of the state.

      (b) The director of the state lottery commission lotteries may license any person as a

lottery sales agent as provided in this chapter. No license shall be issued to any person to engage

in the sale of lottery tickets as his or her sole occupation or business.

      (c) Before issuing any license to a lottery sales agent the director shall consider:

      (1) The financial responsibility and security of the person and his or her business or

activity;

      (2) The accessibility of his or her place of business or activity to the public;

      (3) The sufficiency of existing licensed agents to serve the public interest;

      (4) The volume of expected sales by the applicant;

      (5) Any other factors pertaining to the public interest, convenience or trust.

      (d) The director shall refuse to grant or shall suspend, pending a hearing before the

commission division, or recommend a revocation of a license if the applicant or licensee:

      (1) Has been convicted of a felony, or any crime involving moral turpitude;

      (2) Has been engaging in gambling as a significant source of income;

      (3) Has been convicted of violating any gambling statutes;

      (4) Has been convicted of fraud or misrepresentation in any connection;

      (5) Has been found to have violated any rule, regulation, or order of the state lottery

commission division.

      The license of an agent shall be suspended by the director for any charge which may

result in a conviction for conduct prescribed in subdivisions (d)(1) -- (d)(5); which suspension

shall be effective until a final judicial determination.

      (e) The director shall refuse to grant, or shall suspend, pending a hearing before the

commission division, or recommend revocation of a license if the applicant or licensee is a

corporation:

      (1) Any of whose directors, officers, or controlling shareholders have been found guilty

of any of the activities specified in subsection (d);

      (2) In which it appears to the director of the state lottery commission lotteries that due to

the experience, character, or general fitness of any director, officer, or controlling shareholder, the

granting of a license as a lottery sales agent would be inconsistent with the public interest,

convenience, or trust;

      (3) Not the owner or lessee of the business at which it will conduct a lottery sales agency

pursuant to the license applied for, or that any person, firm, association, or corporation other than

the applicant shares or will share in the profits of the applicant, other than receiving dividends as

a shareholder, or will participate in the management of the affairs of the applicant.

      (f) Every holder of a license as a lottery sales agent shall renew the license annually

pursuant to the rules and regulations of the commission division. Licensees shall pay to the

commission division a fee to be determined by the commission director upon receipt or renewal

of a license.

      (g) Whenever requested by the director, the division of criminal identification of the

department of the attorney general, the superintendent of state police, any superintendent or chief

of police or sergeant of any city or town, shall furnish all information on convictions, arrests and

present investigations concerning any person who is an applicant for a license or who is a licensee

of the state lottery.

      (h) Notwithstanding any other provision of law, any person licensed as provided in this

chapter is authorized and empowered to act as a lottery sales agent.

      (i) Every licensed sales agent authorized pursuant to this section and every licensed

video lottery retailer authorized by chapter 61.2 of this title shall keep conspicuously posted on

his or her premises the name and telephone number of a council on problem gambling recognized

by an appropriate authority within state government or within the professional field of addiction

disorders and a statement of its availability to offer assistance. The lottery commission division

shall supply each licensee with the required notice.

 

     42-61-6. Proceeds of sales -- Segregated funds. -- (a) All proceeds from the sale of

lottery tickets or shares received by a person in the capacity of a sales agent shall constitute a trust

fund until paid into the state lottery fund.

      (b) The sales agent shall be personally liable for all proceeds; and failure to pay the

lottery commission division moneys owed, upon demand, from the sales or misappropriation of

the funds shall constitute embezzlement under section 11-41-3.

      (c) The provisions of this section shall be enforced and prosecuted by the state police and

the attorney general's office.

 

     42-61-8. Sales above fixed price -- Unlicensed sales -- Gifts. -- No person shall sell a

ticket or share at a price greater than that fixed by rule or regulation of the commission division.

No person other than a licensed lottery sales agent shall sell lottery tickets or shares, except that

nothing in this section shall be construed to prevent any individual purchaser from giving lottery

tickets or shares to another as a gift. Any person convicted of violating this section shall be guilty

of a misdemeanor.

 

     42-61-10. Prizes to lottery employees. -- No lottery prize award shall be awarded to or

for any officer or employee of the state lottery commission division, or any blood relative of that

officer or employee living as a member of that officer or employee's household.

 

     42-61-12. Deposit of receipts -- Reports. -- The director shall, in accordance with rules

and regulations, require any and all lottery sales agents to deposit to the credit of the state lottery

fund in financial institutions designated by the commission division all moneys received by those

agents from the sale of lottery tickets or shares, less the amount, if any, retained as compensation

for the sale of tickets or shares and less any moneys paid out as prizes by the agents, and to file

with the director, or his or her designated agents, reports of their receipts and transactions in the

sale of lottery tickets in any form and containing any information he or she may require. The

director may make any arrangements for any person, including a financial institution, to perform

any functions, activities, or services in connection with the operation of the lottery as he or she

may deem advisable pursuant to this chapter and the rules and regulations of the commission

division, and the functions, activities, or services shall constitute lawful functions, activities, and

services of the person.

 

     42-61-15. State lottery fund. -- (a) There is created the state lottery fund, into which

shall be deposited all revenues received by the commission division from the sales of lottery

tickets and license fees. The fund shall be in the custody of the general treasurer, subject to the

direction of the commission division for the use of the commission division, and money shall be

disbursed from it on the order of the controller of the state, pursuant to vouchers or invoices

signed by the director of the commission and certified by the chairperson of the commission

director of administration. The moneys in the state lottery fund shall be allotted in the following

order, and only for the following purposes:

      (1) (i) Establishing a prize fund from which payments of the prize awards shall be

disbursed to holders of winning lottery tickets on checks signed by the director and countersigned

by the chairperson or his or her designee controller of the state or his or her designee. The amount

of payments of prize awards to holders of winning lottery tickets shall be determined by the

commission division, but shall not be less than forty-five percent (45%) nor more than sixty-five

percent (65%) of the total revenue accruing from the sale of lottery tickets.

      (ii) However, for the lottery game commonly known as "Keno", the amount of prize

awards to holders of winning Keno tickets shall be determined by the commission division, but

shall not be less than forty-five percent (45%) nor more than seventy-two percent (72%) of the

total revenue accruing from the sale of Keno tickets.

      (2) Payment of expenses incurred by the commission division in the operation of the

state lotteries including but not limited to costs arising from contracts entered into by the director

for promotional, consulting, or operational services, salaries of professional, technical, and

clerical assistants, and purchases or lease of facilities, lottery equipment, and materials;

      (3) Repayment into the general revenue fund of the amount appropriated for the

implementation of the state lottery; and

      (4) Payment into the general revenue fund of all revenues remaining in the state lottery

fund after the payments specified in subdivisions (a)(1) -- (a)(3) of this section; provided, that the

amount to be transferred into the general revenue fund shall equal no less than twenty-five

percent (25%) of the total revenue received and accrued from the sale of lottery tickets plus any

other income earned from the lottery, provided further, that the revenue returned to the general

fund from the game commonly known as Keno, shall not be calculated as part of the twenty-five

percent (25%) mandate required by this section, but the amount transferred into the general

revenue fund shall equal no less than fifteen percent (15%) of the total Keno revenue received.

      (b) In addition to any other audit, the auditor general shall conduct semi-annual audits of

all accounts and any other audits he or she or the commission division hall deem necessary. The

auditor general may examine all records, files, and other documents of the commission division,

and any records of lottery sales agents that pertain to their activities as agents, for purposes of

conducting authorized audits.

      (c) Payments into the state's general fund specified in subsection (a)(4) of this section

shall be made on an estimated quarterly basis. Payment shall be made on the tenth business day

following the close of the quarter except for the fourth quarter when payment shall be on the last

business day.

 

     SECTION 2. Sections 42-61.2-1, 42-61.2-2, 42-61.2-3, 42-61.2-4 and 42-61.2-7 of the

General Laws in Chapter 42-61.2 entitled "Video Lottery Terminal" are hereby amended to read

as follows:

 

     42-61.2-1. Definitions. -- For the purpose of this chapter, the following words shall

mean:

      (1) "Central communication system" means a system approved by the lottery

commission division, linking all video lottery machines at a licensee location to provide auditing

program information and any other information determined by the lottery. 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 commission

division. The central communications licensee may provide a maximum of fifty percent (50%) of

the video lottery terminals.

      (2) "Licensed video lottery retailer" means a pari-mutuel licensee specifically licensed

by the director subject to the approval of the commission division to become a licensed video

lottery retailer.

      (3) "Net terminal income" means currency placed into a video lottery terminal less

credits redeemed for cash by players.

      (4) "Pari-mutuel licensee" means an entity licensed and authorized to conduct:

      (i) Dog racing, pursuant to chapter 3.1 of title 41; and/or

      (ii) Jai-alai games, pursuant to chapter 7 of title 41.

      (5) "Technology provider" means any individual, partnership, corporation, or association

that designs, manufactures, installs, operates, distributes or supplies video lottery machines or

associated equipment for the sale or use in this state.

      (6) "Video lottery games" means lottery games played on video lottery terminals

controlled by the lottery commission division.

      (7) "Video lottery terminal" means any electronic computerized video game machine

that, upon the insertion of cash, is available to play a video game authorized by the lottery

commission division, and which 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.

 

     42-61.2-2. State lottery commission authorized to operate video lotteries. –Division

of state lottery authorized to operate video lotteries. -- (a) Notwithstanding the provisions of

any other law, the division of state lottery commission is authorized to conduct and control video

lottery games under its authority.

      (b) Video lottery terminals may only be installed and operated at pari-mutuel licensee

facilities existing as of June 30, 1992, as defined in section 42-61.2-1(4) which are specifically

approved by the state lottery director, subject to the approval of the commission, to be licensed

video lottery retailers according to rules and regulations set forth by the commission director.

     (c) Commencing July 1, 2005, the number of video lottery terminals to be installed at

pari-mutuel license facilities shall be established by the general assembly.

     (d) Pursuant to Article 6 section 15 of the Rhode Island Constitution, the general

assembly shall determine the type of lotteries conducted.

 

     42-61.2-3. Additional powers and duties of the commission. –Additional powers and

duties of the director. -- In addition to the powers and duties of the state lottery commission

director under section 42-61-4, the commission director shall meet with the lottery director for the

purpose of promulgating promulgate reasonable rules and regulations relating to video lottery

games and to make recommendations and set policy for these games. These rules and regulations

shall be promulgated as soon as possible after July 1, 1992, and shall include but not be limited

to:

      (1) The commission division shall license technology providers capable of interfacing

with a central communications system controlled by the commission division. In making its

licensing decision, the commission division shall select providers based on the following factors:

providers experienced in performing comparable projects, financial stability, technical and

management abilities, the quality of the product and service capabilities, likelihood of timely

performance, maximum revenue generation, its ability to pass a law enforcement background

investigation, and any other factors found to be relevant to performance. The award of a license to

technology providers under this section shall satisfy the requirements of chapter 2 of title 37. An

outside independent testing laboratory may be utilized by the commission division at the expense

of the individual provider;

      (2) Accounting procedures for determining the net terminal income from lottery video

terminals, and unclaimed prizes and credits;

      (3) The type of video lottery games to be conducted;

      (4) The price to play each game and the prizes or credits to be awarded;

      (5) Financial reporting procedures for licensed video lottery retailers and control

procedures in the event that any of these retailers should become insolvent;

      (6) Insurance and bonding by:

      (i) Licensed video lottery retailers; and

      (ii) Technology provider;

      (7) The licensing of licensed video lottery retailers;

      (8) The contracting with technology providers;

      (9) All video lottery machines shall be linked under a central communications system to

provide auditing program information as approved by the lottery division. The communications

system approved by the lottery division may not limit participation to only one manufacturer of

video lottery machines by either cost of implementing the necessary program modifications to

communicate or the inability to communicate with the central communication system; and

      (10) Any other matters necessary for video lottery terminals or for the convenience of

the public.

 

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

Additional powers and duties of director and lottery division. -- In addition to the powers and

duties set forth in sections 42-61-4 and 42-61.2-3, the director, subject to the approval of the

lottery commission shall have the power to:

      (1) Supervise and administer the operation of video lottery games in accordance with this

chapter and with the rules and regulations of the commission division;

      (2) Recommend to the commission that it suspend Suspend or revoke upon a hearing any

license issued pursuant to this chapter or the rules and regulations promulgated under this chapter;

and

      (3) Subject to the approval of the commission and in 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) Certify monthly to the budget officer, the auditor general, the commission 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 commission 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 which 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.

 

     42-61.2-7. Division of revenue. -- (a) Notwithstanding the provisions of section 42-61-

15, the allocation of net terminal income derived from video lottery games is as follows:

      (1) For deposit in the general fund and to the state lottery commission division fund for

administrative purposes: Net terminal income not otherwise disbursed in accordance with

subdivisions (a)(2) through (a)(5) herein;

      (2) To the licensed video lottery retailer: (a) Lincoln Greyhound Park twenty-eight and

eighty-five hundredths percent (28.85%); (b) Newport Jai Ali twenty-six percent (26%);

      (3) (i) To the technology providers who are not a party to the Master Contract as set forth

and referenced in Public Law 2003, Chapter 32, seven percent (7%) of the net terminal income of

the provider's terminals. The lottery commission shall implement an incentive structure for the

providers for Fiscal Year 2004 only, based on machine performance, not to exceed eight and one-

half percent (8.5%) of net terminal income of the provider's terminals. The lottery commission

shall present this incentive structure in a report to the speaker of the house, the president of the

senate and the governor, at least ninety (90) days prior to implementation of the incentive

structure;

      (ii) To contractors who are a party to the Master Contract as set forth and referenced in

Public Law 2003, Chapter 32, all sums due and payable under said Master Contract.

      (4) To the city or town in which the licensed video retailer is licensed: one percent (1%);

provided, however, beginning January 1, 2005, the town of Lincoln shall receive one and one

quarter percent (1.25%); and

      (5) Unclaimed prizes and credits shall remit to the general fund of the state;

      (6) Payments into the state's general fund specified in subdivisions (a)(1) and (a)(6) shall

be made on an estimated monthly basis. Payment shall be made on the tenth day following the

close of the month except for the last month when payment shall be on the last business day.

      (b) Provided, however, that for the fiscal year commencing July 1, 1993 and subsequent

fiscal years, the sum of five million dollars ($5,000,000) to the extent possible shall be

contributed to the distressed communities relief program, pursuant to section 45-13-12, to be

distributed according to the formula and the contributions shall be as follows:

      (1) One million one hundred fifty-two thousand six hundred eighty-three dollars

($1,152,683) of the net terminal income due retailers under subdivision (a)(2) deposited as

general revenues as follows: Lincoln Greyhound Park seven hundred sixty-seven thousand, six

hundred eighty-seven dollars ($767,687) and Newport Jai Alai Fronton three hundred eighty-four

thousand nine hundred ninety-six dollars ($384,996).

      (2) Six hundred and twenty-eight thousand seven hundred and thirty-seven dollars

($628,737) of the net terminal income due the technology providers under subsection (a)(3)

deposited as general revenues.

      (3) Three million dollars ($3,000,000) from the state general revenue fund.

 

     SECTION 3 Section 42-61-2 of the General Laws in Chapter 42-61 entitled "State

Lottery" is hereby repealed.

 

     42-61-2. Powers and duties of commission. -- The commission shall meet with the

director of lotteries appointed under section 42-61-3 not less than nine (9) times each year, for the

purpose of promulgating and reviewing rules and regulations relating to the lotteries, to make

recommendations and set policy for lotteries, to approve or reject actions of the director and to

transact other business that may be properly brought before the commission. The rules and

regulations promulgated by the commission shall include but not be limited to:

      (1) The types of lotteries to be conducted;

      (2) The price of tickets or shares in the lotteries;

      (3) The number and size of the prizes on the winning tickets or shares;

      (4) The manner of selecting the winning tickets or shares;

      (5) The manner of payment of prizes to the holders of winning tickets or shares;

      (6) The frequency of the drawings or selections of winning tickets or shares;

      (7) The number and types of location at which tickets or shares may be sold;

      (8) The method to be used in selling tickets or shares;

      (9) The licensing of agents to sell tickets or shares, except that a person under the age of

eighteen (18) shall not be licensed as an agent;

      (10) The license fee to be charged to agents;

      (11) The manner in which the proceeds of the sale of lottery tickets or shares are

maintained, reported, and otherwise accounted for;

      (12) The manner and amount of compensation to be paid licensed sales agents necessary

to provide for the adequate availability of tickets or shares to prospective buyers and for the

convenience of the general public;

      (13) The apportionment of the total annual revenue accruing from the sale of lottery

tickets or shares and from all other sources for the payment of prizes to the holders of winning

tickets or shares, for the payment of costs incurred in the operation and administration of the

lotteries, including the expense of the commission and the costs resulting from any contract or

contracts entered into for promotional, advertising, consulting, or operational services or for the

purchase or lease of facilities, lottery equipment, and materials, for the repayment of moneys

appropriated to the lottery fund;

      (14) The superior court upon petition of the majority of the commission after a hearing

may issue subpoenas to compel the attendance of witnesses and the production of documents,

papers, books, records, and other evidence before it in any matter over which it has jurisdiction,

control or supervision. If a person subpoenaed to attend in the proceeding or hearing fails to obey

the command of the subpoena without reasonable cause, or if a person in attendance in the

proceeding or hearing refuses without lawful cause to be examined or to answer a legal or

pertinent question or to exhibit any book, account, record, or other document when ordered to do

so by the court, that person may be punished for contempt of the court;

      (15) No action of the commission shall be binding unless taken at a meeting at which at

least five (5) of the members are present and a majority of those present and voting are in favor of

the action of the commission. The rules and regulations promulgated by the commission or any

amendments, revisions, supplements, or repeal thereof, shall be immediately transmitted, and

under the certification of the executive secretary of the commission, to the secretary of state for

filing;

      (16) The manner, standards, and specification for a process of competitive bidding for

commission purchases and contracts; and

      (17) The sale of commercial advertising space on the reverse side of, or in other

available areas upon, lottery tickets provided that all net revenue derived from the sale of the

advertising space shall be deposited immediately into the state's general fund and shall not be

subject to the provisions of section 42-61-15.

 

     SECTION 4. Title 22 of the General Laws entitled "General Assembly" is hereby

amended by adding thereto the following chapter:

     CHAPTER 14.2

PERMANENT JOINT COMMITTEE ON STATE LOTTERY

     22-14.2-1. Permanent joint committee on state lottery - Composition. – There is

hereby created a permanent joint committee on state lottery. The permanent joint committee on

state lottery shall consist of eight (8) members; four (4) of whom shall be members of the senate,

not more than three (3) from the same political party to be appointed by the senate president; and

four (4) of whom shall be members of the house of representatives, not more than three (3) from

the same political party to be appointed by the speaker of the house.

     The senate president and the speaker of the house shall consult with the house and senate

minority leaders on the appointment of the minority members.

 

      22-14.2-2. Powers and duties of permanent joint committee on state lottery. – The

permanent joint committee on state lottery shall have the authority to:

     (a) provide oversight to the state lottery and the division of state lottery;

     (b) confer as the committee deems desirable with the director of lotteries;

     (c) recommend the type of lotteries to be conducted;

     (d) issue subpoenas, subpoenas duces tecum and orders for the production of books,

accounts, papers, records and documents, and;

     (e) make recommendations to the general assembly and propose legislation regarding the

operation of the state lottery.

     SECTION 5. This act shall take effect upon passage.

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LC02083

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