HOUSE AMENDED PRIOR PRINTER'S NO. 1385 PRINTER'S NO. 2487
No. 1136 Session of 1989
INTRODUCED BY PUNT, BRIGHTBILL, LEMMOND, BELL, MADIGAN, WENGER, SHUMAKER, CORMAN, HOPPER, RHOADES, BAKER AND WILT, JUNE 28, 1989
AS REPORTED FROM COMMITTEE ON FINANCE, HOUSE OF REPRESENTATIVES, AS AMENDED, SEPTEMBER 25, 1990
AN ACT 1 Amending the act of August 26, 1971 (P.L.351, No.91), entitled <-- 2 "An act providing for a State Lottery and administration 3 thereof; authorizing the creation of a State Lottery 4 Commission; prescribing its powers and duties; disposition of 5 funds; violations and penalties therefor; exemption of prizes 6 from State and local taxation and making an appropriation," 7 providing that there shall be no drawings or selections of 8 winning tickets on Sundays. 9 PROVIDING FOR CONTROL AND LICENSING OF VIDEO POKER MACHINES IN <-- 10 THIS COMMONWEALTH; CREATING THE VIDEO POKER MACHINE CONTROL 11 COMMISSION AND PROVIDING FOR ITS POWERS AND DUTIES; AND 12 PROVIDING FOR LOCAL OPTION AND FOR DISTRIBUTION OF REVENUE. 13 TABLE OF CONTENTS 14 SECTION 1. SHORT TITLE. 15 SECTION 2. DEFINITIONS. 16 SECTION 3. VIDEO POKER MACHINE CONTROL COMMISSION. 17 SECTION 4. QUALIFICATIONS. 18 SECTION 5. CHAIRMAN OF COMMISSION; QUORUM. 19 SECTION 6. DIRECTOR. 20 SECTION 7. POWERS AND DUTIES OF COMMISSION. 21 SECTION 8. USE OF ENFORCEMENT AGENTS. 22 SECTION 9. UNLAWFUL USE BY MINORS. 23 SECTION 10. DIRECT DISPENSING. 24 SECTION 11. LOCAL OPTIONS. 25 SECTION 12. AUTHORITY TO LICENSE. 26 SECTION 13. DISTRIBUTION OF PROCEEDS. 27 SECTION 14. GOVERNMENT REVENUES. 28 SECTION 15. CREATION OF ACCOUNT. 29 SECTION 16. PREEMPTION OF LOCAL TAXES AND LICENSE FEES. 30 SECTION 17. PROHIBITION AND PENALTIES. 31 SECTION 18. EXEMPTION FROM STATE GAMBLING LAWS.
1 SECTION 19. EXEMPTION FROM FEDERAL REGULATION. 2 SECTION 20. APPLICABILITY. 3 SECTION 21. EFFECTIVE DATE. 4 The General Assembly of the Commonwealth of Pennsylvania 5 hereby enacts as follows: 6 Section 1. Section 6(a)(6) of the act of August 26, 1971 <-- 7 (P.L.351, No.91), known as the State Lottery Law, is amended to 8 read: 9 Section 6. Powers and Duties of the Secretary of Revenue.-- 10 (a) In addition to the powers and duties provided by law and 11 "The Administrative Code of 1929," the Secretary of Revenue 12 shall have the power and it shall be his duty to operate and 13 administer the lottery, and to promulgate rules and regulations 14 governing the establishment and operation thereof, including but 15 not limited to: 16 * * * 17 (6) The frequency of the drawings or selections of winning 18 tickets or shares, [without limitation] except that no drawings 19 or selections may occur on Sundays. 20 * * * 21 Section 2. This act shall take effect immediately. 22 SECTION 1. SHORT TITLE. <-- 23 THIS ACT SHALL BE KNOWN AND MAY BE CITED AS THE VIDEO POKER 24 MACHINE CONTROL LAW. 25 SECTION 2. DEFINITIONS. 26 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS ACT SHALL 27 HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE 28 CONTEXT CLEARLY INDICATES OTHERWISE: 29 "COMMISSION." THE VIDEO POKER MACHINE CONTROL COMMISSION 30 CREATED BY THIS ACT. 31 "DISTRIBUTOR." AN INDIVIDUAL, PARTNERSHIP OR CORPORATION 19890S1136B2487 - 2 -
1 LICENSED UNDER THIS ACT TO BUY, SELL, LEASE OR DISTRIBUTE VIDEO 2 POKER MACHINES. THE TERM EXCLUDES MACHINE OWNERS AND 3 MANUFACTURERS. 4 "GROSS PROCEEDS." THE TOTAL AMOUNT OF MONEY PLACED INTO 5 VIDEO POKER MACHINES. 6 "INCENTIVE." A CONSIDERATION, INCLUDING A PREMIUM OR BONUS 7 IN CASH OR ADVANCE COMMISSION OR MERCHANDISE, OFFERED FROM A 8 MACHINE OWNER TO A LICENSED ESTABLISHMENT IN ORDER TO SOLICIT 9 ITS BUSINESS. 10 "LICENSED ESTABLISHMENT." A RESTAURANT, BAR, TAVERN, HOTEL 11 OR CLUB WHICH HAS A VALID LIQUOR OR MALT BEVERAGE LICENSE UNDER 12 THE ACT OF APRIL 12, 1951 (P.L.90, NO.21), KNOWN AS THE LIQUOR 13 CODE, AND WHICH IS LOCATED WITHIN A PARTICIPATING POLITICAL 14 SUBDIVISION. 15 "MACHINE OWNER." AN INDIVIDUAL, PARTNERSHIP OR CORPORATION 16 WHICH IS LICENSED UNDER THIS ACT AND WHICH OWNS, SERVICES AND 17 MAINTAINS VIDEO POKER MACHINES FOR PLACEMENT IN LICENSED 18 ESTABLISHMENTS. 19 "MANUFACTURER." AN INDIVIDUAL, PARTNERSHIP OR CORPORATION 20 WHICH IS LICENSED UNDER THIS ACT AND WHICH MANUFACTURES OR 21 ASSEMBLES VIDEO POKER MACHINES. 22 "MUNICIPALITY." A CITY, BOROUGH, INCORPORATED TOWN OR 23 TOWNSHIP OR A HOME RULE MUNICIPALITY FORMERLY CLASSIFIED AS A 24 CITY, BOROUGH, INCORPORATED TOWN OR TOWNSHIP. 25 "NET PROFITS." GROSS PROCEEDS AFTER AWARDS HAVE BEEN PAID. 26 "PARTICIPATING POLITICAL SUBDIVISIONS." ANY CITY, 27 INCORPORATED TOWN, TOWNSHIP, BOROUGH OR HOME RULE MUNICIPALITY 28 WHERE VIDEO POKER MACHINES ARE IN USE IN ACCORDANCE WITH THIS 29 ACT. 30 "PERSON." INCLUDES A CORPORATION, PARTNERSHIP AND 19890S1136B2487 - 3 -
1 ASSOCIATION, AS WELL AS A NATURAL PERSON. 2 "VIDEO POKER MACHINES." A DEVICE OR MACHINE WHICH, UPON 3 INSERTION OF A COIN OR CURRENCY, WILL PLAY OR SIMULATE THE PLAY 4 OF THE GAME OF POKER, UTILIZING A VIDEO DISPLAY AND 5 MICROPROCESSORS AND IN WHICH, BY THE SKILL OF THE PLAYER OR BY 6 CHANCE, THE PLAYER MAY RECEIVE FREE GAMES OR CREDITS WHICH MAY 7 BE REDEEMED FOR CASH. NO MACHINE SHALL DIRECTLY DISPENSE ANY 8 COINS, CASH, TOKENS OR ANYTHING OF VALUE. ALL MACHINES MUST 9 CONTAIN ELECTRONIC INFORMATION VERIFYING TRANSMITTING 10 COMPONENTS. 11 SECTION 3. VIDEO POKER MACHINE CONTROL COMMISSION. 12 (A) COMMISSION CREATED.--AN INDEPENDENT COMMISSION, TO BE 13 KNOWN AS THE VIDEO POKER MACHINE CONTROL COMMISSION IS HEREBY 14 CREATED. THE COMMISSION SHALL CONSIST OF FIVE MEMBERS, ONE TO BE 15 APPOINTED BY THE GOVERNOR, ONE BY THE SPEAKER OF THE HOUSE OF 16 REPRESENTATIVES, ONE BY THE PRESIDENT PRO TEMPORE OF THE SENATE, 17 ONE BY THE MINORITY LEADER OF THE HOUSE OF REPRESENTATIVES AND 18 ONE BY THE MINORITY LEADER OF THE SENATE. 19 (B) MEMBERS.--OF THE ORIGINAL MEMBERS, TWO SHALL BE 20 APPOINTED FOR A TERM OF TWO YEARS, TWO FOR A TERM OF FOUR YEARS 21 AND ONE FOR A TERM OF SIX YEARS. THOSE APPOINTED BY THE MINORITY 22 LEADER OF THE HOUSE OF REPRESENTATIVES AND THE MINORITY LEADER 23 OF THE SENATE SHALL SERVE THE INITIAL TWO-YEAR TERM. THOSE 24 APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES AND THE 25 PRESIDENT PRO TEMPORE OF THE SENATE SHALL SERVE THE INITIAL 26 FOUR-YEAR TERMS. THE GOVERNOR'S APPOINTMENT SHALL SERVE THE 27 INITIAL SIX-YEAR TERM. THEREAFTER, ALL APPOINTMENTS SHALL BE FOR 28 TERMS OF SIX YEARS OR UNTIL SUCCESSORS ARE APPOINTED AND 29 QUALIFIED. ALL SUCCESSORS SHALL BE APPOINTED BY THE SAME 30 APPOINTING AUTHORITY AS THE MEMBERS WHOM THEY ARE REPLACING. 19890S1136B2487 - 4 -
1 (C) COMPENSATION AND EXPENSES.--THE MEMBERS OF THE 2 COMMISSION SHALL BE COMPENSATED AT A RATE OF $125 PER DAY AND 3 SHALL RECEIVE REIMBURSEMENT FOR THEIR ACTUAL AND NECESSARY 4 EXPENSES WHILE PERFORMING THE BUSINESS OF THE COMMISSION. 5 SECTION 4. QUALIFICATIONS. 6 (A) CITIZENSHIP AND RESIDENCY.--EACH MEMBER OF THE 7 COMMISSION, AT THE TIME OF APPOINTMENT AND QUALIFICATION, SHALL 8 BE A CITIZEN OF THE UNITED STATES AND A RESIDENT OF THIS 9 COMMONWEALTH AND SHALL HAVE BEEN A QUALIFIED ELECTOR IN THIS 10 COMMONWEALTH FOR A PERIOD OF AT LEAST TWO YEARS PRECEDING THE 11 MEMBER'S APPOINTMENT. 12 (B) OFFICES.--NO MEMBER OF THE COMMISSION SHALL, DURING THE 13 MEMBER'S PERIOD OF SERVICE, HOLD ANY OTHER OFFICE UNDER THE LAWS 14 OF THIS COMMONWEALTH OR THE UNITED STATES OR SEEK ELECTED OFFICE 15 OF ANY KIND WITHIN THIS COMMONWEALTH OR THE UNITED STATES. 16 SECTION 5. CHAIRMAN OF COMMISSION; QUORUM. 17 (A) APPOINTMENT.--THE MEMBER APPOINTED BY THE GOVERNOR SHALL 18 SERVE AS CHAIRMAN. THE CHAIRMAN SHALL, WHEN PRESENT, PRESIDE AT 19 ALL MEETINGS. IN THE CHAIRMAN'S ABSENCE, A MEMBER DESIGNATED BY 20 THE COMMISSION SHALL PRESIDE. 21 (B) QUORUM.--THREE MEMBERS OF THE COMMISSION SHALL 22 CONSTITUTE A QUORUM, AND ANY ACTION OR ORDER OF THE COMMISSION 23 SHALL REQUIRE THE APPROVAL OF AT LEAST THREE MEMBERS. 24 SECTION 6. DIRECTOR. 25 THE COMMISSION MAY APPOINT AN EXECUTIVE DIRECTOR TO HOLD 26 OFFICE AT ITS PLEASURE. THE DIRECTOR SHALL HAVE POWERS AND 27 DUTIES AS THE COMMISSION SHALL PRESCRIBE AND SHALL RECEIVE 28 COMPENSATION AS THE COMMISSION SHALL DETERMINE. THE DIRECTOR 29 SHALL HAVE THE AUTHORITY TO EMPLOY PERSONNEL NECESSARY TO CARRY 30 OUT THE DUTIES OF OFFICE. 19890S1136B2487 - 5 -
1 SECTION 7. POWERS AND DUTIES OF COMMISSION. 2 (A) GENERAL POWERS AND DUTIES.--THE COMMISSION SHALL: 3 (1) PROVIDE FOR LICENSING AND FOR DISTRIBUTION OF 4 REVENUE. 5 (2) PRESCRIBE ALL NECESSARY APPLICATION AND REPORTING 6 FORMS. 7 (3) GRANT OR DENY LICENSE APPLICATIONS. 8 (4) PRESCRIBE TYPES OF VIDEO POKER MACHINES TO BE USED. 9 (B) LICENSE APPROVAL.--THE COMMISSION MAY NOT DENY ANY 10 APPLICATION OR LIMIT, CONDITION OR RESTRICT ANY LICENSE EXCEPT 11 FOR NONCONFORMANCE WITH THIS ACT. AN APPLICANT SHALL NOT BE 12 GRANTED A LICENSE UNLESS: 13 (1) IF THE APPLICANT IS AN INDIVIDUAL: 14 (I) THE APPLICANT IS OF GOOD CHARACTER, HONESTY AND 15 INTEGRITY AND IN ALL RESPECTS IS QUALIFIED AND HAS 16 ADEQUATE FINANCING FROM SUITABLE SOURCES. 17 (II) IF THE APPLICANT IS A DISTRIBUTOR OR MACHINE 18 OWNER THE APPLICANT HAS BEEN A CITIZEN OF THE UNITED 19 STATES AND A RESIDENT OF THIS COMMONWEALTH FOR AT LEAST 20 TWO YEARS PRIOR TO THE APPLICATION. 21 (2) IF THE APPLICANT IS A PARTNERSHIP, ALL PARTNERS 22 QUALIFY AS INDIVIDUALS UNDER PARAGRAPH (1). 23 (3) IF THE APPLICANT IS A DISTRIBUTOR OR MACHINE OWNER 24 AND A CORPORATION: 25 (I) IT IS A REGISTERED PENNSYLVANIA CORPORATION FOR 26 AT LEAST ONE YEAR. 27 (II) AT LEAST 50% OF ITS DIRECTORS HAVE BEEN 28 PENNSYLVANIA RESIDENTS FOR AT LEAST TWO YEARS. 29 (III) ALL OFFICERS QUALIFY AS INDIVIDUALS UNDER 30 PARAGRAPH (1). 19890S1136B2487 - 6 -
1 (IV) ALL STOCKHOLDERS ARE INDIVIDUALS. 2 (C) HEARING AND APPEALS.--ANY PERSON WHO WAS DENIED A 3 LICENSE SHALL HAVE THE RIGHT TO A HEARING BEFORE THE COMMISSION. 4 THE HEARING SHALL BE CONDUCTED IN ACCORDANCE WITH THE PROVISIONS 5 OF 2 PA.C.S. (RELATING TO ADMINISTRATIVE LAW AND PROCEDURE). AN 6 AGGRIEVED PARTY SHALL HAVE THE RIGHT TO APPEAL THE DECISION ON 7 LICENSE DENIAL TO THE COURT OF COMMON PLEAS IN THE JUDICIAL 8 DISTRICT HAVING JURISDICTION OVER THE APPLICANT AND/OR THE 9 LICENSED PREMISES. 10 (D) WINNING PERCENTAGE.--THE COMMISSION SHALL PRESCRIBE 11 WINNING PERCENTAGES AND NECESSARY MACHINE ACCOUNTING 12 INFORMATION. CENTRAL AUDITING IS REQUIRED AND THE COMMISSION 13 SHALL PROVIDE LICENSED MANUFACTURERS OR MANUFACTURERS APPLYING 14 FOR LICENSURE THE PROTOCOL DOCUMENTATION NECESSARY TO ENABLE 15 THEIR VIDEO POKER MACHINES TO COMMUNICATE WITH THE COMMISSION'S 16 CENTRAL COMPUTER IN PROVIDING THE AUDITING PROGRAM INFORMATION 17 AND CONTROLS APPROVED BY THE COMMISSION. ALL VIDEO POKER 18 MACHINES WILL BE SET AT A MINIMUM WIN PERCENTAGE OF 80%. ALL 19 VIDEO POKER MACHINES WILL HAVE METERING DEVICES TO VERIFY THE 20 WINNING PERCENTAGES. 21 (E) VIOLATIONS.--THE COMMISSION SHALL INVESTIGATE LICENSEES 22 FOR VIOLATIONS OF THIS ACT AND SHALL HOLD HEARINGS IN WHICH TO 23 CONSIDER THESE MATTERS. HEARINGS AND APPEALS SHALL BE CONDUCTED 24 IN THE SAME MANNER AS SET FORTH IN SUBSECTION (C). THE 25 COMMISSION SHALL HAVE AUTHORITY TO SUSPEND OR REVOKE A LICENSE 26 IF IT FINDS THAT A VIOLATION OF THIS ACT HAS OCCURRED. NO 27 LICENSE SHALL BE SUSPENDED OR REVOKED UNTIL A HEARING IS 28 COMPLETED. THE FINE FOR A VIOLATION OF PROVISIONS OF THIS ACT OR 29 OF REGULATIONS ADOPTED UNDER THIS ACT SHALL NOT EXCEED $5,000 30 FOR THE FIRST OFFENSE AND $15,000 FOR EACH SUBSEQUENT VIOLATION. 19890S1136B2487 - 7 -
1 (F) STANDARDS OF CONDUCT.--THE COMMISSION SHALL PRESCRIBE 2 RULES AND REGULATIONS FOR THE CONDUCT OF THE OFFICERS, EMPLOYEES 3 AND AGENTS OF THE COMMISSION. 4 (G) REGULATION.--THE COMMISSION SHALL PROMULGATE REGULATIONS 5 TO CARRY OUT THE PROVISIONS OF THIS ACT. 6 SECTION 8. USE OF ENFORCEMENT AGENTS. 7 (A) POWERS.--EMPLOYEES OF THE COMMISSION DESIGNATED AS 8 ENFORCEMENT AGENTS SHALL BE EMPOWERED TO INVESTIGATE THE 9 BACKGROUND AND ASSOCIATES OF EVERY LICENSE APPLICANT TO WHATEVER 10 EXTENT IS JUDGED NECESSARY BY THE COMMISSION. NO INVESTIGATION 11 SHALL BE UNDERTAKEN PRIOR TO THE SUBMISSION OF AN APPLICATION 12 FOR A LICENSE BY A PARTY, AND NO INVESTIGATION SHALL CONTINUE 13 SUBSEQUENT TO THE DENIAL OF A LICENSE OR THE WITHDRAWAL OF A 14 LICENSE APPLICATION. 15 (B) AUTHORITY.--ENFORCEMENT AGENTS ARE PEACE OFFICERS AND 16 SHALL HAVE POLICE POWER AND AUTHORITY THROUGHOUT THIS 17 COMMONWEALTH TO ARREST, ON VIEW OR UNDER WARRANT, ANY PERSON 18 TAMPERING WITH VIDEO POKER MACHINES, ATTEMPTING OR CONSPIRING TO 19 MANIPULATE THE OUTCOME OR THE PAYOFF OF ANY MACHINE, OR 20 MANIPULATING THE OUTCOME OR PAYOFF OF ANY MACHINE BY PHYSICAL 21 TAMPERING OR THROUGH THE INTERFERENCE OF THE LAWFUL OR PROPER 22 FUNCTIONING OF THE MECHANISM BY ANY MEANS WHATSOEVER. 23 (C) INVESTIGATION AND REPORT.--ENFORCEMENT AGENTS MAY 24 INVESTIGATE ANY ALLEGED ILLEGAL ACTIVITIES CONCERNING VIDEO 25 POKER MACHINES AND THEIR OPERATION, MAINTENANCE AND PLACEMENT. 26 FINDINGS SHALL BE REPORTED IN WRITING TO THE COMMISSION, WHICH 27 SHALL RELAY ANY SUSPECTED CRIMINAL ACTIVITY OR VIOLATIONS OF THE 28 LAW TO THE DISTRICT ATTORNEY FOR PROSECUTION. 29 (D) STATE AND LOCAL POLICE.--IN ADDITION TO ANY OTHER PERSON 30 AUTHORIZED TO ENFORCE THE PROVISIONS OF THIS ACT, THE 19890S1136B2487 - 8 -
1 PENNSYLVANIA STATE POLICE AND POLICE OF PARTICIPATING POLITICAL 2 SUBDIVISIONS ARE EMPOWERED TO ENFORCE THIS ACT. 3 SECTION 9. UNLAWFUL USE BY MINORS. 4 (A) MINORS.--NO PERSON UNDER 21 YEARS OF AGE MAY USE OR PLAY 5 A VIDEO POKER MACHINE. A MINOR USING OR PLAYING OR ATTEMPTING TO 6 USE OR PLAY A VIDEO POKER MACHINE COMMITS A SUMMARY OFFENSE. 7 (B) LICENSEES.--A LICENSED ESTABLISHMENT IN WHICH A PERSON 8 UNDER 21 YEARS OF AGE PLAYS OR USES A VIDEO POKER MACHINE, 9 WHETHER OR NOT THAT LICENSED ESTABLISHMENT IS ACTUALLY AWARE OF 10 THE MINOR'S AGE, COMMITS A SUMMARY OFFENSE AND SHALL, UPON 11 CONVICTION, PAY A FINE OF NOT MORE THAN $5,000. THE 12 ESTABLISHMENT OF ANY OF THE FOLLOWING FACTS BY A PERSON ALLOWING 13 A MINOR TO OPERATE THE VIDEO POKER MACHINES CONSTITUTES A 14 DEFENSE TO PROSECUTION UNDER THIS SUBSECTION: 15 (1) THE MINOR FALSELY REPRESENTED IN WRITING THAT THE 16 MINOR WAS 21 YEARS OF AGE OR OLDER. 17 (2) THE APPEARANCE OF THE MINOR WAS SUCH THAT AN 18 ORDINARY PERSON OF PRUDENT JUDGMENT WOULD BELIEVE THE MINOR 19 TO BE 21 YEARS OF AGE OR OLDER. 20 SECTION 10. DIRECT DISPENSING. 21 A VIDEO POKER MACHINE MAY NOT DIRECTLY DISPENSE COINS, CASH, 22 TOKENS OR ANY OTHER ARTICLE OF EXCHANGE OR VALUE EXCEPT FOR 23 RECEIPT TICKETS. SUCH TICKETS SHALL BE DISPENSED BY PRESSING THE 24 TICKET DISPENSING BUTTON ON THE MACHINE AT THE END OF ONE'S TURN 25 OR PLAY. THE TICKET SHALL INDICATE THE TOTAL AMOUNT OF CREDITS 26 AND THE CASH AWARD, AND THE PLAYER SHALL TURN IN THIS TICKET TO 27 THE APPROPRIATE PERSON AT THE LICENSED ESTABLISHMENT TO RECEIVE 28 THE CASH AWARD. THE COST OF THE CREDIT SHALL BE 25¢, AND THE 29 NUMBER OF CREDITS PLAYED PER GAME SHALL NOT EXCEED EIGHT. VIDEO 30 POKER MACHINES SHALL NOT ACCEPT ANY MONEY DENOMINATION IN EXCESS 19890S1136B2487 - 9 -
1 OF A $5 BILL. NO CASH AWARD FOR ANY INDIVIDUAL GAME SHALL EXCEED 2 $500. ALL VIDEO POKER MACHINES SHALL BE DESIGNED AND 3 MANUFACTURED WITH TOTAL ACCOUNTABILITY, TO INCLUDE GROSS 4 PROCEEDS, NET PROFITS, WINNING PERCENTAGES AND WITH THE ABILITY 5 TO ELECTRONICALLY VERIFY AND TRANSMIT TO A CENTRAL COMPUTER ANY 6 OTHER INFORMATION THE COMMISSION REQUIRES. 7 SECTION 11. LOCAL OPTIONS. 8 (A) ELECTION TO BE HELD.--IN ANY MUNICIPALITY, AN ELECTION 9 MAY BE HELD ON THE DATE OF A PRIMARY, MUNICIPAL OR GENERAL 10 ELECTION TO DETERMINE THE WILL OF THE ELECTORS WITH RESPECT TO 11 THE ISSUANCE OF LICENSES WITHIN THE LIMITS OF SUCH MUNICIPALITY 12 UNDER THE PROVISIONS OF THIS ACT. WHENEVER ELECTORS EQUAL TO AT 13 LEAST 25% OF THE HIGHEST VOTE CAST FOR ANY OFFICE IN THE 14 MUNICIPALITY AT THE LAST PRECEDING GENERAL ELECTION SHALL FILE A 15 PETITION WITH THE COUNTY BOARD OF ELECTIONS OF THE COUNTY, OR 16 THE GOVERNING BODY OF THE MUNICIPALITY ADOPTS, BY A MAJORITY 17 VOTE, A RESOLUTION TO PLACE SUCH A QUESTION ON THE BALLOT AND A 18 COPY OF THE RESOLUTION IS FILED WITH THE BOARD OF ELECTIONS OF 19 THE COUNTY, FOR A REFERENDUM ON THE QUESTION OF ISSUING 20 LICENSES, THE COUNTY BOARD OF ELECTIONS SHALL CAUSE A QUESTION 21 TO BE PLACED ON THE BALLOT OR ON THE VOTING MACHINE BOARD AND 22 SUBMITTED AT THE NEXT FOLLOWING PRIMARY, MUNICIPAL OR GENERAL 23 ELECTION. THE QUESTION SHALL BE IN THE FOLLOWING FORM: 24 DO YOU FAVOR THE ISSUANCE OF LICENSES TO PERMIT THE PLAY 25 OF VIDEO POKER IN THE OF ? 26 (B) VOTE.--IF A MAJORITY OF THE ELECTORS VOTING ON THE 27 QUESTION UNDER SUBSECTION (A) VOTE "YES", THEN LICENSES SHALL BE 28 ISSUED BY THE COMMISSION IN SUCH MUNICIPALITY, BUT IF A MAJORITY 29 OF THE ELECTORS VOTING ON SUCH QUESTION VOTE "NO", THEN THE 30 COMMISSION SHALL HAVE NO POWER TO ISSUE OR TO RENEW, UPON THEIR 19890S1136B2487 - 10 -
1 EXPIRATION, ANY LICENSES IN SUCH MUNICIPALITY, UNLESS AND UNTIL, 2 AT A LATER ELECTION, A MAJORITY OF THE VOTING ELECTORS VOTE 3 "YES" ON SUCH QUESTION. 4 (C) VOTING PROCEDURES.--PROCEEDINGS UNDER THIS SECTION SHALL 5 BE IN ACCORDANCE WITH THE PROVISIONS OF THE ACT OF JUNE 3, 1937 6 (P.L.1333, NO.320), KNOWN AS THE PENNSYLVANIA ELECTION CODE. 7 (D) APPLICABILITY.--THIS ACT APPLIES ONLY TO THOSE LICENSED 8 ESTABLISHMENTS LOCATED IN MUNICIPALITIES WHICH HAVE ADOPTED THE 9 PROVISIONS OF THIS ACT BY AN AFFIRMATIVE VOTE IN A MUNICIPAL 10 REFERENDUM IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION. 11 (E) WITHDRAWAL OF APPROVAL.--THE REFERENDUM PROCEDURE 12 CONTAINED IN THIS SECTION SHALL ALSO BE AVAILABLE TO WITHDRAW 13 THE APPROVAL OF THE ISSUANCE OF LICENSES WITHIN THE MUNICIPALITY 14 WHICH WAS GRANTED THROUGH A PRIOR REFERENDUM. 15 SECTION 12. AUTHORITY TO LICENSE. 16 (A) TYPE OF LICENSES.--AFTER APPROVING THE PROPER 17 APPLICATIONS, THE COMMISSION SHALL ISSUE THE FOLLOWING LICENSES: 18 (1) A MANUFACTURER'S LICENSE TO A PERSON THAT 19 MANUFACTURES OR ASSEMBLES VIDEO POKER MACHINES FOR USE IN 20 PENNSYLVANIA. THE ANNUAL FEE SHALL BE $25,000. 21 (2) A DISTRIBUTOR'S LICENSE TO A PERSON THAT BUYS, SELLS 22 OR SERVICES VIDEO POKER MACHINES IN PENNSYLVANIA OTHER THAN A 23 MACHINE OWNER. THE ANNUAL FEE SHALL BE $25,000. 24 (3) A MACHINE OWNER'S LICENSE TO A PERSON WHO OWNS, 25 SERVICES AND MAINTAINS VIDEO POKER MACHINES FOR PLACEMENT IN 26 LICENSED ESTABLISHMENTS. THE ANNUAL FEE SHALL BE $25,000 FOR 27 THE FIRST 50 INDIVIDUAL POKER MACHINE LICENSES. FOR EACH 28 ADDITIONAL VIDEO POKER MACHINE, THE ANNUAL FEE SHALL BE $500 29 PER MACHINE. EVERY VIDEO POKER MACHINE IN USE IN THIS 30 COMMONWEALTH MUST HAVE A CURRENT $500 LICENSE DISPLAYED. 19890S1136B2487 - 11 -
1 EVERY VIDEO POKER MACHINE LICENSED UNDER THIS ACT MUST BE 2 MANUFACTURED BY AN INDIVIDUAL, PARTNERSHIP OR CORPORATION 3 LICENSED UNDER PARAGRAPH (1). THIS TYPE OF LICENSE WILL ALLOW 4 A MACHINE OWNER TO SELL USED VIDEO POKER MACHINES THAT THE 5 OWNERS PURCHASED NEW AND OPERATED FOR AT LEAST TWO YEARS. 6 (4) A LICENSED ESTABLISHMENT MUST OBTAIN A LICENSE UNDER 7 THIS ACT IN ORDER TO HAVE VIDEO POKER MACHINES ON ITS 8 PREMISES. THE ANNUAL FEE FOR THE LICENSE SHALL BE $300 FOR 9 EACH MACHINE, PER YEAR. 10 (B) LICENSED ESTABLISHMENT REQUIREMENTS.--FOR ANY LICENSED 11 ESTABLISHMENT WHICH IS APPROVED BY THE COMMONWEALTH AND WHICH 12 USES VIDEO POKER MACHINES, THE MAXIMUM NUMBER OF VIDEO POKER 13 MACHINES ALLOWED PER LOCATION SHALL BE THREE. NO VIDEO POKER 14 MACHINES MAY BE PLACED IN ANY LICENSED ESTABLISHMENT UNLESS THE 15 OWNER OF A LICENSED ESTABLISHMENT HAS ENTERED INTO A CONTRACT 16 WITH A MACHINE OWNER FOR THE PLACEMENT OF THE MACHINE OR 17 MACHINES FOR A MINIMUM OF TWO YEARS. 18 (C) LIMITATIONS.--NO PERSON MAY HOLD MORE THAN ONE CLASS OF 19 LICENSE ISSUED UNDER THIS ACT, DIRECTLY OR INDIRECTLY, OR HAVE 20 ANY INTEREST THEREIN. 21 (D) INCENTIVES.--NO MACHINE OWNER MAY GIVE AND NO LICENSED 22 ESTABLISHMENT MAY RECEIVE AN INCENTIVE. 23 SECTION 13. DISTRIBUTION OF PROCEEDS. 24 (A) COLLECTION.--GROSS PROCEEDS SHALL BE COLLECTED BY THE 25 MACHINE OWNER FOR EACH LICENSED VIDEO POKER MACHINE. 26 (B) DISTRIBUTION OF NET PROFITS.--THE NET PROFITS DERIVED 27 FROM A VIDEO POKER MACHINE SHALL BE DISTRIBUTED BY THE MACHINE 28 OWNER AS FOLLOWS: 29 (1) 34% TO THE MACHINE OWNER. 30 (2) 34% TO THE LICENSED ESTABLISHMENT WHERE THE MACHINE 19890S1136B2487 - 12 -
1 IS LOCATED. 2 (3) 14% TO THE POLITICAL SUBDIVISION WHERE THE VIDEO 3 POKER MACHINE IS LOCATED. 4 (4) 11% TO THE SCHOOL DISTRICT WHERE THE VIDEO POKER 5 MACHINE IS LOCATED. 6 (5) 5% TO THE STATE LOTTERY FUND. 7 (6) 2% TO THE ATTORNEY GENERAL TO BE USED FOR DRUG 8 EDUCATION AND/OR ENFORCEMENT. 9 (C) REPORTS.--THE COMMISSION IS AUTHORIZED TO ESTABLISH A 10 PROCEDURE FOR AUDITING POKER MACHINES. THE PROCEDURE WILL 11 INCLUDE REPORTS PREPARED BY THE MACHINE OWNERS AND ELECTRONIC 12 AUDITING AT A CENTRAL LOCATION DESIGNATED BY THE COMMISSION. THE 13 TIMING AND CONTENTS OF THE REPORTS SHALL BE ESTABLISHED BY THE 14 COMMISSION. THE COMMISSION SHALL HAVE THE AUTHORITY TO CONTRACT 15 WITH AN INDEPENDENT AUDITING FIRM TO ESTABLISH AND OPERATE ALL 16 OR SOME OF THE AUDITING REQUIREMENTS AS ESTABLISHED BY THE 17 COMMISSION. 18 SECTION 14. GOVERNMENT REVENUES. 19 THE COMMISSION WILL ESTABLISH PROCEDURES ON THE METHOD OF 20 PAYMENT OF REVENUES DUE THE MUNICIPALITIES, SCHOOL DISTRICTS AND 21 ATTORNEY GENERAL'S OFFICE. ANY MACHINE OWNER WHO DOES NOT COMPLY 22 WITH THE PAYMENT SCHEDULE SHALL BE SUBJECT TO A 5% LATE PAYMENT 23 PENALTY. ANY MACHINE OWNER WHO IS CONSISTENTLY LATE IN MAKING 24 PAYMENTS MAY BE SUBJECT TO LICENSE REVOCATION. 25 SECTION 15. CREATION OF ACCOUNT. 26 ALL REVENUES FROM LICENSES AND FINES SHALL BE PLACED IN A 27 RESTRICTED REVENUE ACCOUNT TO FUND THE TOTAL OPERATION OF THE 28 COMMISSION, INCLUDING THE ELECTRONIC AUDITING FIRM, BUT NOT 29 LIMITED TO, SALARIES, ADMINISTRATIVE EXPENSES AND AUDITING 30 COSTS. THE COMMISSION SHALL ALLOCATE A MINIMUM OF $1,000,000 19890S1136B2487 - 13 -
1 ANNUALLY TO BE USED FOR THE TREATMENT OF COMPULSIVE BEHAVIORS IN 2 ACCORDANCE WITH REGULATIONS ADOPTED BY THE COMMISSION. THE FIRST 3 SUCH ALLOCATION SHALL BE MADE IN THE FIRST FISCAL YEAR 4 COMMENCING ONE YEAR FOLLOWING THE EFFECTIVE DATE OF THIS ACT. 5 SECTION 16. PREEMPTION OF LOCAL TAXES AND LICENSE FEES. 6 VIDEO POKER MACHINES AND COIN-OPERATED AMUSEMENT MACHINES 7 LOCATED IN A PARTICIPATING POLITICAL SUBDIVISION SHALL BE EXEMPT 8 FROM TAXES LEVIED UNDER THE ACT OF AUGUST 5, 1932 (SP.SESS., 9 P.L.45, NO.45), REFERRED TO AS THE STERLING ACT, THE ACT OF 10 DECEMBER 31, 1965 (P.L.1257, NO.511), KNOWN AS THE LOCAL TAX 11 ENABLING ACT, OR THE ACT OF APRIL 13, 1972 (P.L.184, NO.62), 12 KNOWN AS THE HOME RULE CHARTER AND OPTIONAL PLANS LAW, OR UNDER 13 ANY OTHER STATUTE THAT CONFERS TAXING AUTHORITY TO ANY POLITICAL 14 SUBDIVISION. 15 SECTION 17. PROHIBITION AND PENALTIES. 16 (A) MANUFACTURE.--A PERSON MAY NOT MANUFACTURE, ASSEMBLE, 17 PRODUCE OR SELL A VIDEO POKER MACHINE IN THIS COMMONWEALTH 18 UNLESS THE PERSON HAS A VALID MANUFACTURER'S LICENSE ISSUED 19 UNDER SECTION 12(A)(1). A MANUFACTURER MAY ONLY SELL VIDEO POKER 20 MACHINES IN USE IN THIS COMMONWEALTH TO PERSONS HAVING A VALID 21 DISTRIBUTOR'S LICENSE. 22 (B) DISTRIBUTION.--A PERSON MAY NOT SELL, SERVICE, 23 DISTRIBUTE, LEASE OR MARKET A VIDEO POKER MACHINE IN THIS 24 COMMONWEALTH UNLESS THE PERSON HAS A VALID DISTRIBUTOR'S LICENSE 25 ISSUED UNDER SECTION 12(A)(2). A DISTRIBUTOR MAY ONLY SELL VIDEO 26 POKER MACHINES FOR USE IN THIS COMMONWEALTH TO PERSONS HAVING A 27 VALID DISTRIBUTOR'S OR MACHINE OWNER'S LICENSE. THIS SECTION 28 DOES NOT PRECLUDE A MACHINE OWNER FROM SELLING USED VIDEO POKER 29 MACHINES THAT THE OWNER PURCHASED NEW AND OPERATED FOR AT LEAST 30 TWO YEARS. 19890S1136B2487 - 14 -
1 (C) PLACE ON LOCATIONS.--A PERSON MAY NOT OWN, SERVICE, 2 MAINTAIN, LEASE OR PLACE A VIDEO POKER MACHINE UNLESS HE HAS A 3 VALID MACHINE OWNER'S LICENSE ISSUED UNDER SECTION 12(A)(3). A 4 MACHINE OWNER CAN ONLY PLACE VIDEO POKER MACHINES FOR USE IN 5 THIS COMMONWEALTH IN LOCATIONS HAVING A VALID ESTABLISHMENT 6 LICENSE. 7 (D) USE.--A PERSON MAY NOT OFFER, ENABLE OR ALLOW THE 8 PLAYING OF VIDEO POKER AT AN ESTABLISHMENT UNLESS THAT 9 ESTABLISHMENT HAS A VALID ESTABLISHMENT LICENSE ISSUED UNDER 10 SECTION 12(A)(4). A PERSON WITH A VALID ESTABLISHMENT LICENSE 11 MAY NOT HAVE MORE THAN THREE VIDEO POKER MACHINES IN A LICENSED 12 ESTABLISHMENT AT THE SAME TIME. 13 (E) TAMPERING.--A PERSON MAY NOT MANIPULATE THE OUTCOME OR 14 PAYOFF OF A VIDEO POKER MACHINE THROUGH INTERFERENCE WITH THE 15 PROPER FUNCTIONING OF THE MECHANISM. 16 (F) PENALTIES.-- 17 (1) A PERSON WHO VIOLATES THIS SECTION COMMITS A 18 MISDEMEANOR OF THE THIRD DEGREE AND SHALL, UPON CONVICTION, 19 BE SENTENCED TO PAY A FINE OF $1,000, OR TO IMPRISONMENT FOR 20 NOT MORE THAN ONE YEAR, OR BOTH. 21 (2) A PERSON WHO VIOLATES THIS SECTION A SECOND TIME 22 COMMITS A MISDEMEANOR OF THE SECOND DEGREE AND SHALL, UPON 23 CONVICTION, BE SENTENCED TO PAY A FINE OF $2,000, OR TO 24 IMPRISONMENT FOR NOT MORE THAN TWO YEARS, OR BOTH. 25 (3) A PERSON WHO VIOLATES THIS SECTION A THIRD AND 26 SUBSEQUENT TIME COMMITS A MISDEMEANOR OF THE FIRST DEGREE AND 27 SHALL, UPON CONVICTION, BE SENTENCED TO PAY A FINE OF $5,000, 28 OR TO IMPRISONMENT FOR NOT MORE THAN FIVE YEARS, OR BOTH. 29 SECTION 18. EXEMPTION FROM STATE GAMBLING LAWS. 30 VIDEO POKER MACHINES AND THEIR USE ARE EXEMPT FROM 18 PA.C.S. 19890S1136B2487 - 15 -
1 § 5513 (RELATING TO GAMBLING DEVICES, GAMBLING, ETC.). 2 SECTION 19. EXEMPTION FROM FEDERAL REGULATION. 3 THE GENERAL ASSEMBLY DECLARES THAT THE COMMONWEALTH IS EXEMPT 4 FROM SECTION 2 OF THE GAMBLING DEVICES TRANSPORTATION ACT (64 5 STAT. 1134, 15 U.S.C. § 1172). SHIPMENTS OF VIDEO DEVICES INTO 6 THIS COMMONWEALTH IN COMPLIANCE WITH SECTIONS 3 AND 4 OF THE 7 GAMBLING DEVICES TRANSPORTATION ACT (64 STAT. 1134, 15 U.S.C. §§ 8 1173 AND 1174) SHALL BE DEEMED LEGAL SHIPMENTS INTO THIS 9 COMMONWEALTH. 10 SECTION 20. APPLICABILITY. 11 THE PROVISIONS OF THIS ACT SHALL NOT APPLY TO ACTIVITIES 12 RELATING TO SPECIAL OCCASION PERMITS. 13 SECTION 21. EFFECTIVE DATE. 14 THIS ACT SHALL TAKE EFFECT IN 60 DAYS. F23L72CHF/19890S1136B2487 - 16 -