07-21-092

WSR 07-21-092

PROPOSED RULES

GAMBLING COMMISSION

[ Filed October 18, 2007, 10:07 a.m. ]

     Original Notice.

     Preproposal statement of inquiry was filed as WSR 07-16-035.

     Title of Rule and Other Identifying Information: WAC 230-14-045 Authorized pull-tab dispensers and 230-05-030 Fees for other businesses.

     Hearing Location(s): DoubleTree Guest Suites, 16500 Southcenter Parkway, Seattle, WA 98188, [phone], on January 11, 2008, at 9:30 a.m.

     Date of Intended Adoption: January 11, 2008.

     Submit Written Comments to: Susan Arland, P.O. Box 42400, Olympia, WA 98504-2400, e-mail [e-mail], fax [phone], by January 1, 2008.

     Assistance for Persons with Disabilities: Contact Gail Grate, Executive Assistant, by January 1, 2008, TTY [phone] or [phone].

     Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Pull-tab dispensing devices that feature slot like video displays and read barcodes on pull-tabs have been approved by the commission since 1997 and are being operated at pull-tab licensees. There are two different types of video pull-tab dispensing devices that open and/or read encoded data on a pull-tab, Gold Crown and the VIP dispensing devices. ZDI is licensed and manufactures the VIP device. In 2004, ZDI petitioned for a rule change to allow pull-tabs to be stored electronically on a CD in the dispensing device in lieu of the actual paper pull-tab. The commission voted not to file this petition. Then in September 2005, ZDI filed a petition for a declaratory ruling with the commission seeking approval to add a gift card acceptor to the dispensing device to allow players to purchase pull-tabs and for prizes under $20 to be awarded as additional credits on the gift card. In 2006, an administrative law judge and the commission found that such a device did not meet WAC requirements. In 2006, ZDI filed a petition for rule change to allow punch board or pull-tab winnings to be paid in the form of a gift certificate or gift card if the prize was $20 or less. ZDI also requested that participants be able to use gift certificates and gift cards to participate in gambling activities. ZDI appealed the commission's ruling to Thurston County Superior Court. On August 17, 2007, the superior court issued an order approving the gift card technology and remanding the case back to the commission for action in compliance with the order. The judge also entered a finding of fact that "the VIP display is intentionally designed to emulate a video slot machine." As a result, commissioners expressed concerns about the potential impact of the court's ruling. Staff was asked to bring these amendments forward to start a discussion on whether these electronic video pull-tab dispensing devices: (1) Are consistent with the commission's legislative authorization to define a pull-tab game; (2) are consistent with the original authorizing rules; and (3) authorized by the court [to] increase the possibility of an unintentional expansion of electronic machine gambling in Washington. The commission riled [filed] the proposal at their October commission [meeting] and asked that staff work with the industry to come up with an alternative proposal that would set out specific requirements for the dispensing devices and bring it to the November 2007 commission meeting.

     Reasons Supporting Proposal: See above.

     Statutory Authority for Adoption: RCW 9.46.070.

     Statute Being Implemented: Not applicable.

     Name of Proponent: Washington state gambling commission, governmental.

     Name of Agency Personnel Responsible for Drafting: Susan Arland, Rules Coordinator, Lacey, [phone]; Implementation: Rick Day, Director, Lacey, [phone]; and Enforcement: Mark Harris, Assistant Director, Lacey, [phone].

     No small business economic impact statement has been prepared under chapter 19.85 RCW. A small business economic impact statement has not been prepared pursuant to RCW 19.85.025, and/or the proposed rule change clarifies language of rules without changing the effect.

     A cost-benefit analysis is not required under RCW 34.05.328. The Washington state gambling commission is not an agency that is statutorily required to prepare a cost-benefit analysis under RCW 34.05.328.

October 18, 2007

Susan Arland

Rules Coordinator

OTS-1021.1

AMENDATORY SECTION(Amending Order 606, filed 1/18/07, effective 1/1/08)

WAC 230-05-030   Fees for other businesses.   All other business license applicants must pay the following fees to us when applying for gambling licenses, miscellaneous changes, or inspection services:

1. Commercial amusement games

License	Annual Gross Gambling Receipts	Fee
Class A	Premises only	*$310/ $143
Class B	Up to $50,000	$436
Class C	Up to $100,000	$1,122
Class D	Up to $250,000	$2,506
Class E	Up to $500,000	$4,398
Class F	Up to $1,000,000	$7,552
Class G	Over $1,000,000	$9,448

*We reduce the license fee by $164 when you apply for additional licenses at the same business premises, apply for multiple licenses at the same business premises, or a licensee is renewing an annual license.

2. Distributor

License	Annual Gross Sales	Fee
Class A	Nonpunch board/pull-tab only	$625
Class B	Up to $250,000	$1,250
Class C	Up to $500,000	$1,878
Class D	Up to $1,000,000	$2,506
Class E	Up to $2,500,000	$3,266
Class F	Over $2,500,000	$4,020

3. Fund-raising event equipment distributor

License	Description	Fee
Class A	Rents or leases equipment for fund-raising event or recreational gaming activity up to 10 times per year.	$247
Class B	Rents or leases equipment for fund-raising event or recreational gaming activity more than 10 times per year.	$625

4. Gambling service supplier

License	Fee
Annual	$651
Financing, consulting, and management contract review	$136

5. Linked bingo prize provider

License	Fee
Annual	$4,184

6. Manufacturer

License	Annual Gross Sales	Fee
Class A	Pull-tab dispensing devices only	$625
Class B	Up to $250,000	$1,250
Class C	Up to $500,000	$1,878
Class D	Up to $1,000,000	$2,506
Class E	Up to $2,500,000	$3,266
Class F	Over $2,500,000	$4,020

7. Permits

Type	Description	Fee
Agricultural fair	One location and event only	$26
Agricultural fair annual permit	Annual permit for specified different events and locations	$180
Recreational gaming activity		$56
Manufacturer's special sales permit		$211
Punch board and pull-tab service business permit	Initial application fee	$217
Punch board and pull-tab service business permit	Renewal	$53

8. Changes

Application	Description	Fee
Name		$26
Location		$26
Business classification	Same owners	$56
Exceeding license class	New class fee, less previous fee paid, plus	$26
Duplicate license		$26
Corporate stock/limited liability company shares/units		$56
License transfers		$56

9. Other fees

Type	Fee
Defective punch board/pull-tab cost recovery fees	Up to $100
Failing to apply for license class upgrade	Up to fifty percent of the difference between our fees for the licensee's present license class and the new license class or one thousand dollars, whichever is less, plus $26
Review of gambling equipment, supplies, services, or games	Cost reimbursement

10. Identification stamps

Type		Fee
(a) Punch boards and pull-tabs
(i) Standard	Wagers fifty cents and below	$.27
	Wagers over fifty cents	$1.05
(ii) Progressive jackpot pull-tab series	Per series	$10.60
(iii) Pull-tab series with carry-over jackpots	Per series	$1.05
(b) Pull-tab dispensing devices
(((i))) Mechanical and electro-mechanical		$.27
(((ii) Electronic	Dispensing devices that require initial and ongoing evaluation of electronic components or functions, such as reading encoded data on pull-tabs, accounting for income or prizes	$106.17 annually))
Replacement of identification stamps		$26
(c) Disposable bingo cards
(i) Single game sets of individual cards or sheets of cards		$.27
(ii) Multigame card packets		$1.16
(iii) Cards used to play for linked bingo prizes	Fee per 250 cards	$.42
(iv) Cards used to play for linked bingo prizes	Fee per 5,000 cards	$8.49
(d) Coin or token-activated amusement games
Annually - operated at any Class A amusement game license location		$26.53
(e) Electronic bingo card daubers
Annual		$10.60
(f) Electronic card facsimile table
Annual		$361.51

11. Two-part payment plan participation

Annual participation

$26

[Statutory Authority: RCW 9.46.070. 07-03-082 (Order 606), § 230-05-030, filed 1/18/07, effective 1/1/08; 06-07-157 (Order 457), § 230-05-030, filed 3/22/06, effective 1/1/08.]

OTS-1124.1

AMENDATORY SECTION(Amending Order 614, filed 8/10/07, effective 1/1/08)

WAC 230-14-045   Authorized pull-tab dispensers.   (1) Authorized pull-tab dispensers must:

     (a) Be made by a licensed manufacturer; and

     (b) Conspicuously display a stamp, seal, or label identifying the manufacturer, city, and state where manufactured; and

     (c) Be stamped with a serial number on the case.

     (2) Perforated window type pull-tab dispensers must:

     (a) Have a resettable counter visible to the customer indicating the number of pull-tabs left in the dispenser; or

     (b) Be made so that players can:

     (i) Clearly see each pull-tab in the dispenser, except for that area at the bottom, not more than one inch in height, covered for security or mechanical reasons; and

     (ii) Estimate how many pull-tabs remain within the dispenser using permanent markings which divide the pull-tabs remaining into divisions of approximately twenty-five tabs.

     (3) "Jar" or "banded" type pull-tab dispensers must:

     (a) Have a resettable counter visible to the player indicating the number of jar or banded tabs left in the dispenser; or

     (b) Be made so that players can clearly see all jar or banded tabs or jar tab bundles within the dispenser.

     (4) Dispensers with bill acceptors or similar mechanisms must inform the player if they do not return change.

     (5) Pull-tab dispensers must not:

     (a) Have a video display; or

     (b) Open a pull-tab and/or read encoded data.

[Statutory Authority: RCW 9.46.070. 07-17-058 (Order 614), § 230-14-045, filed 8/10/07, effective 1/1/08.]