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PRINTER'S NO. 703
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
628
Session of
2017
INTRODUCED BY RESCHENTHALER, BOSCOLA, WHITE, BLAKE AND REGAN,
APRIL 17, 2017
REFERRED TO COMMUNITY, ECONOMIC AND RECREATIONAL DEVELOPMENT,
APRIL 17, 2017
AN ACT
Amending Titles 4 (Amusements) and 18 (Crimes and Offenses) of
the Pennsylvania Consolidated Statutes, in Pennsylvania
Gaming Control Board, further providing for general and
specific powers; in licensees, further providing for Category
1 slot machine license, for number of slot machine licenses
and for change in ownership or control of slot machine
licensee, repealing provisions related to multiple slot
machine license prohibition and prohibiting undue economic
concentration; in revenues, further providing for gross
terminal revenue deductions and for establishment of State
Gaming Fund and net slot machine revenue distribution; in
administration and enforcement, further providing for
investigations and enforcement; providing for video gaming;
establishing the Video Gaming Fund, the Slot Machine Licensee
Loss Mitigation Fund and the Fire Company and Emergency
Responder Grant Fund; and, in riot, disorderly conduct and
related offenses, further providing for the offense of
gambling devices, gambling, etc.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 1202(b) of Title 4 of the Pennsylvania
Consolidated Statutes is amended by adding a paragraph to read:
§ 1202. General and specific powers.
* * *
(b) Specific powers.--The board shall have the specific
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power and duty:
* * *
(35) At the board's discretion, to periodically require
a licensed gaming entity to submit to the board its security
and surveillance measures and ensure the adequacy of such
measures as the Pennsylvania State Police reduce and
eliminate permanent onsite personnel and offices from
licensed facilities as required under section 1517(g).
Section 2. Sections 1302(a) and 1307 of Title 4 are amended
to read:
§ 1302. Category 1 slot machine license.
(a) Eligibility.--A person may be eligible to apply for a
Category 1 license to place and operate slot machines at a
licensed racetrack facility if the person:
(1) has been issued a license from either the State
Horse Racing Commission or the State Harness Racing
Commission to conduct thoroughbred or harness race meetings
respectively with pari-mutuel wagering and has conducted live
horse races for not less than two years immediately preceding
the effective date of this part;
(2) has been approved or issued a license from either
the State Horse Racing Commission or the State Harness Racing
Commission to conduct thoroughbred or harness race meetings
respectively with pari-mutuel wagering within 18 months
immediately preceding the effective date of this part and
will successfully conduct live racing pursuant to the
requirements of section 1303 (relating to additional Category
1 slot machine license requirements);
(3) has been approved by the State Harness Racing
Commission, after the effective date of this part, to conduct
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harness race meetings with pari-mutuel wagering and will
conduct live racing pursuant to the requirements of section
1303; or
(4) is a successor in interest to persons eligible under
paragraph (1), (2) or (3) who comply with the requirements of
section 1328 (relating to change in ownership or control of
slot machine licensee) or is a successor in interest to
persons otherwise eligible under paragraph (1), (2) or (3)
but precluded from eligibility under the provisions of
section [1330] 1330.1 (relating to undue economic
concentration prohibited).
Nothing in this part shall be construed to permit the approval
or issuance of more than one slot machine license at a licensed
racetrack facility.
* * *
§ 1307. Number of slot machine licenses.
(a) Limitation.--The board may license no more than seven
Category 1 licensed facilities and no more than five Category 2
licensed facilities, as it may deem appropriate, as long as two,
and not more, Category 2 licensed facilities are located by the
board within the city of the first class and that one, and not
more, Category 2 licensed facility is located by the board
within the city of the second class. The board may at its
discretion increase the total number of Category 2 licensed
facilities permitted to be licensed by the board by an amount
not to exceed the total number of Category 1 licenses not
applied for within five years following the effective date of
this part. Except as permitted by section 1328 (relating to
change in ownership or control of slot machine licensee), any
Category 1 license may be reissued by the board at its
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discretion as a Category 2 license if an application for
issuance of such license has not been made to the board. The
board may license no more than [three] two Category 3 licensed
facilities.
(b) Delay of issuance.--Notwithstanding subsection (a) or
any other provisions of this part, the board may not:
(1) Accept an application for a Category 1 slot machine
license for a period starting on the effective date of this
subsection through July 1, 2020.
(2) Issue a Category 1 slot machine license for a period
starting on the effective date of this subsection through
July 1, 2020.
(c) Applicability.--Subsection (b) shall not apply to a
change of ownership or control of a Category 1 slot machine
license as permitted by section 1328.
Section 3. Section 1328 of Title 4 is amended by adding a
subsection to read:
§ 1328. Change in ownership or control of slot machine
licensee.
* * *
(f) Undue economic concentration prohibited.--A change in
ownership or control of a slot machine licensee shall comply
with section 1330.1 (relating to undue economic concentration
prohibited).
Section 4. Section 1330 of Title 4 is repealed:
[§ 1330. Multiple slot machine license prohibition.
No slot machine licensee, its affiliate, intermediary,
subsidiary or holding company may possess an ownership or
financial interest that is greater than 33.3% of another slot
machine licensee or person eligible to apply for a Category 1
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license, its affiliate, intermediary, subsidiary or holding
company. The board shall approve the terms and conditions of any
divestiture under this section. Under no circumstances shall any
such divestiture be approved by the board if the compensation
for the divested interest in a person eligible to apply for a
Category 1 license exceeds the greater of the original cost of
the interest, the book value of the interest or an independently
assessed value of the interest one month prior to the effective
date of this part and, in the case of a person eligible to apply
for a Category 1 license, unless the person acquiring the
divested interest is required to continue conducting live racing
at the location where live racing is currently being conducted
in accordance with section 1303 (relating to additional Category
1 slot machine license requirements) and be approved for a
Category 1 slot machine license. No such slot machine license
applicant shall be issued a slot machine license until the
applicant has completely divested its ownership or financial
interest that is in excess of 33.3% in another slot machine
licensee or person eligible to apply for a Category 1 license,
its affiliate, intermediary, subsidiary or holding company.]
Section 5. Title 4 is amended by adding a section to read:
§ 1330.1. Undue economic concentration prohibited.
(a) General rule.--No slot machine licensee, its affiliate,
intermediary, subsidiary or holding company may possess an
ownership or financial interest of another slot machine licensee
or person eligible to apply for a Category 1 license, its
affiliate, intermediary, subsidiary or holding company if the
ownership or financial interest would result in undue economic
concentration in this Commonwealth.
(b) Board to establish criteria.--The board shall establish
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through regulation criteria for determining whether the issuance
of a slot machine license or a change in ownership or control of
a slot machine licensee occurring under section 1328 (relating
to change in ownership or control of slot machine licensee)
constitutes undue economic concentration. The criteria shall
include:
(1) The percentage share of the market presently
controlled by the applicant.
(2) The estimated increase in the market share if the
applicant is issued the slot machine license.
(3) The relative position of other slot machine
licensees.
(4) The current and projected financial condition of the
gaming industry in this Commonwealth.
(5) Current market conditions, including level of
competition, consumer demand, market concentration, any
consolidation trends in the industry and any other relevant
characteristics of the market.
(6) Whether the applicant has separate organizational
structures or other independent obligations.
(7) Potential impact on the projected future growth and
development of the gaming industry in this Commonwealth.
(8) Whether the issuance or holding of the slot machine
license by the applicant will adversely impact consumer
interests.
(9) Any other criteria the board may require.
(c) Divestiture.--No applicant shall be issued a slot
machine license or approved for a change in ownership or control
until the applicant has completely divested a portion of
ownership or financial interest of another slot machine licensee
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or person eligible to apply for a Category 1 license, its
affiliate, intermediary, subsidiary or holding company
determined by the board to be necessary to meet the requirements
of this section. The board shall approve the terms and
conditions of any divestiture that may be required under this
section.
(d) Definition.--For the purpose of this section, "undue
economic concentration" means that a slot machine licensee, its
affiliate, intermediary, subsidiary or holding company would
have such actual or potential domination of the gaming market in
this Commonwealth as to substantially impede or suppress
competition among slot machine licensees or adversely impact the
economic stability of the gaming industry in this Commonwealth.
Section 6. Sections 1402(b) and 1403(b) of Title 4 are
amended to read:
§ 1402. Gross terminal revenue deductions.
* * *
(b) [(Reserved).] Assessment limitation.--
(1) Beginning July 1, 2017, the assessment rate
determined by the department under subsection (a) shall not
exceed an amount equal to 1.7% of the slot machine licensee's
gross terminal revenue.
(2) Beginning July 1, 2018, and each year thereafter,
the assessment rate determined by the department under
subsection (a) shall not exceed an amount equal to 1.5% of
the slot machine licensee's gross terminal revenue.
§ 1403. Establishment of State Gaming Fund and net slot machine
revenue distribution.
* * *
(b) Slot machine tax.--
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(1) (i) The department shall determine and each slot
machine licensee shall pay a daily tax of 34% from its
daily gross terminal revenue from the slot machines in
operation at its facility and a local share assessment as
provided in subsection (c).
(ii) This paragraph shall expire June 30, 2018.
(2) Beginning July 1, 2018, the department shall
determine and each slot machine licensee shall pay a daily
tax of 29% from its daily gross terminal revenue from the
slot machines in operation at its facility and a local share
assessment as provided in subsection (c).
(3) All funds owed to the Commonwealth, a county or a
municipality under this section shall be held in trust by the
licensed gaming entity for the Commonwealth, the county and
the municipality until the funds are paid or transferred to
the fund.
(4) Unless otherwise agreed to by the board, a licensed
gaming entity shall establish a separate bank account to
maintain gross terminal revenue until such time as the funds
are paid or transferred under this section.
(5) Moneys in the fund are hereby appropriated to the
department on a continuing basis for the purposes set forth
in subsection (c).
* * *
Section 7. Section 1517 of Title 4 is amended by adding a
subsection to read:
§ 1517. Investigations and enforcement.
* * *
(g) Permanent Pennsylvania State Police presence.--
(1) The Pennsylvania State Police shall:
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(i) Incrementally reduce and eliminate permanent
onsite personnel and any offices located within all
licensed facilities no later than July 1, 2018.
(ii) Submit a plan to the board detailing the
incremental reduction and elimination of permanent
Pennsylvania State Police personnel and offices from all
licensed facilities by the date contained in subparagraph
(i) no later than January 1, 2018.
(2) Nothing contained in subsection (c) shall be
construed as to require the Pennsylvania State Police to have
permanent onsite personnel or an office within a licensed
facility.
(3) Submit to each licensed gaming entity an
individualized plan detailing the incremental reduction and
elimination of permanent onsite Pennsylvania State Police
personnel and offices from the licensed gaming entity's
licensed facility by the date contained in subparagraph (i)
no later than January 1, 2018.
Section 8. Title 4 is amended by adding a part to read:
PART III
VIDEO GAMING
Chapter
31. General Provisions
33. Administration
35. Application and Licensure
37. Operation
39. Enforcement
41. Revenues
43. Ethics
45. Miscellaneous Provisions
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CHAPTER 31
GENERAL PROVISIONS
Sec.
3101. Scope of part.
3102. Definitions.
§ 3101. Scope of part.
This part relates to video gaming terminals.
§ 3102. Definitions.
The following words and phrases when used in this part shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Affiliate," "affiliate of" or "person affiliated with." A
person who directly or indirectly, through one or more
intermediaries, controls, is controlled by or is under common
control with a specified person.
"Applicant." A person who, on his own behalf or on behalf of
another, applies for permission to engage in an act or activity
that is regulated under the provisions of this part.
"Associated equipment." Equipment or a mechanical,
electromechanical or electronic contrivance, component or
machine used in connection with video gaming terminals or
redemption terminals, including replacement parts, hardware and
software.
"Background investigation." A security, criminal, credit and
suitability investigation of a person as provided for in this
part that includes the status of taxes owed to the United
States, the Commonwealth and its political subdivisions.
"Board." The Pennsylvania Gaming Control Board established
under section 1201 (relating to Pennsylvania Gaming Control
Board established).
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"Bureau." The Bureau of Investigations and Enforcement of
the board.
"Cash." United States currency and coin.
"Cash equivalent." A ticket, token, chip, card or other
similar instrument or representation of value that the board
deems a cash equivalent in accordance with this part.
"Central control computer." A central site computer
controlled by the department and accessible by the board to
which all video gaming terminals communicate for the purpose of
auditing capacity, real-time information retrieval of the
details of any financial event that occurs in the operation of a
video gaming terminal or redemption terminal, including, but not
limited to, coin in, coin out, ticket in, ticket out, jackpots,
video gaming terminal and redemption terminal door openings and
power failure and remote video gaming terminal or redemption
terminal activation and disabling of video gaming terminals or
redemption terminals.
"Cheat."
(1) Any of the following:
(i) To defraud or steal from a player, terminal
operator licensee, establishment licensee or the
Commonwealth while operating or playing a video gaming
terminal, including causing, aiding, abetting or
conspiring with another person to do so.
(ii) To alter or causing, aiding, abetting or
conspiring with another person to alter the elements of
chance, method of selection or criteria that determine:
(A) The result of a video gaming terminal game.
(B) The amount or frequency of payment in a
video gaming terminal game.
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(C) The value of a wagering instrument.
(D) The value of a wagering credit.
(iii) The term does not include altering a video
gaming terminal or associated equipment for maintenance
or repair with the approval of a terminal operator
licensee.
"Cheating or thieving device." A device:
(1) used or possessed with the intent to be used to
cheat during the operation or play of a video gaming
terminal; or
(2) used to alter a video gaming terminal without the
terminal operator licensee's approval.
"Compensation." Anything of value, money or a financial
benefit conferred on or received by a person in return for
services rendered or to be rendered whether by the person or
another.
"Complimentary service." A lodging, service or item that is
provided to an individual at no cost or at a reduced cost that
is not generally available to the public under similar
circumstances. Group rates, including convention and government
rates, shall be deemed to be generally available to the public.
"Conduct of video gaming." The licensed placement, operation
and play of video gaming terminals under this part, as
authorized and approved by the board.
"Controlling interest." Any of the following:
(1) For a publicly traded domestic or foreign
corporation, the term means a person has a controlling
interest in a legal entity, applicant or licensee if a
person's sole voting rights under State law or corporate
articles or bylaws entitle the person to elect or appoint one
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or more of the members of the board of directors or other
governing board or the person holds an ownership or
beneficial holding of 5% or more of the securities of the
publicly traded corporation, partnership, limited liability
company or other form of publicly traded legal entity, unless
this presumption of control or ability to elect is rebutted
by clear and convincing evidence.
(2) For a privately held domestic or foreign
corporation, partnership, limited liability company or other
form of privately held legal entity, the term means the
holding of any securities in the legal entity, unless this
presumption of control is rebutted by clear and convincing
evidence.
"Conviction." A finding of guilt or a plea of guilty or nolo
contendere, whether or not a judgment of sentence has been
imposed as determined by the law of the jurisdiction in which
the prosecution was held. The term does not include a conviction
that has been expunged or overturned or for which an individual
has been pardoned or had an order of Accelerated Rehabilitative
Disposition entered.
"Corporation." The term includes a publicly traded
corporation.
"Department." The Department of Revenue of the Commonwealth.
"Establishment." A liquor establishment, nonprimary location
or truck stop establishment.
"Establishment license." A license issued by the board
authorizing an establishment to permit a terminal operator
licensee to place and operate video gaming terminals on the
establishment's premises pursuant to this part and the rules and
regulations promulgated under this part.
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"Establishment licensee." An establishment that holds an
establishment license.
"Executive-level public employee." The term shall include
the following:
(1) A deputy secretary of the Commonwealth and the
Governor's Office executive staff.
(2) An employee of the executive branch whose duties
substantially involve licensing or enforcement under this
part, who has discretionary power that may affect or
influence the outcome of a Commonwealth agency's action or
decision or who is involved in the development of regulations
or policies relating to a licensed entity. The term includes
an employee with law enforcement authority.
(3) An employee of a county or municipality with
discretionary powers that may affect or influence the outcome
of the county's or municipality's action or decision related
to this part or who is involved in the development of law,
regulation or policy relating to matters regulated under this
part. The term includes an employee with law enforcement
authority.
(4) An employee of a department, agency, board,
commission, authority or other governmental body not included
in paragraph (1), (2) or (3) with discretionary power that
may affect or influence the outcome of the governmental
body's action or decision related to this part or who is
involved in the development of regulation or policy relating
to matters regulated under this part. The term includes an
employee with law enforcement authority.
"Financial backer." An investor, mortgagee, bondholder,
noteholder or other sources of equity or capital provided to an
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applicant or licensed entity.
"Fire Company and Emergency Responder Grant Fund." The fund
established in section 4106 (relating to Fire Company and
Emergency Responder Grant Fund).
"Gambling game." A game that plays or simulates the play of
video poker, bingo, keno, reel games, blackjack or other similar
game authorized by the board.
"Gaming employee."
(1) Any of the following:
(i) An employee of a terminal operator licensee or
supplier licensee that is not a key employee but has
direct contact with establishment licensees or is
otherwise involved in the conduct of video gaming.
(ii) An employee of a supplier licensee whose duties
are directly involved with the repair or distribution of
video gaming terminals or associated equipment sold or
provided to a terminal operator licensee within this
Commonwealth as determined by the board.
(2) The term does not include nongaming personnel as
determined by the board or an employee of an establishment
licensee.
"Gaming school." An educational institution approved by the
Department of Education as an accredited college or university,
community college, Pennsylvania private licensed school or its
equivalent and whose curriculum guidelines are approved by the
Department of Labor and Industry to provide education and job
training related to employment opportunities associated with
video gaming terminals and associated equipment maintenance and
repair.
"Gaming service provider." A person that is not required to
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be licensed as a terminal operator, manufacturer, supplier or
establishment licensee and provides goods or services to a
terminal operator licensee that directly relates to the
operation and security of a video gaming terminal or redemption
terminal. The term shall not include a person that supplies
goods or services that, at the discretion of the board, does not
impact the integrity of video gaming, video gaming terminals or
the connection of video gaming terminals to the central control
computer system, including:
(1) Seating to accompany video gaming terminals.
(2) Structural or cosmetic renovations, improvements or
other alterations to a video gaming area.
"Grocery store." Any of the following:
(1) A retail establishment, commonly known as a grocery
store, supermarket or delicatessen, where food, food products
and supplies are sold for human consumption on or off the
premises.
(2) A restaurant with an interior connection to, and the
separate and segregated portion of, another retail
establishment that is dedicated solely to the sale of food,
food products and supplies for the table for human
consumption on or off the premises.
"Gross terminal revenue." The total of cash or cash
equivalents received by a video gaming terminal minus the total
of cash or cash equivalents paid out to players as a result of
playing a video gaming terminal. The term does not include
counterfeit cash or cash taken in a fraudulent act perpetrated
against a terminal operator licensee for which the terminal
operator licensee is not reimbursed.
"Holding company." A person, other than an individual,
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which, directly or indirectly, owns or has the power or right to
control or to vote a significant part of the outstanding voting
securities of a corporation or other form of business
organization. A holding company indirectly has, holds or owns
any such power, right or security if it does so through an
interest in a subsidiary or successive subsidiaries.
"Incentive." Consideration, including a promotion or prize,
provided to a player or potential player as an enticement to
play a video gaming terminal. The term shall not include
consideration, promotions, prizes or complimentary play provided
to a player or potential player through a customer loyalty or
rewards card program approved by the board.
"Inducement."
(1) Any of the following:
(i) Consideration paid directly or indirectly, from
a manufacturer, supplier, terminal operator, procurement
agent, gaming employee, nongaming employee or another
person on behalf of an applicant or licensee, to an
establishment licensee, establishment licensee owner or
an employee of the establishment licensee, directly or
indirectly as an enticement to solicit or maintain the
establishment licensee or establishment licensee owner's
business.
(ii) Cash, incentive, marketing and advertising
cost, gift, food, beverage, loan, prepayment of gross
terminal revenue and other contribution or payment that
offsets an establishment licensee's operational costs, or
as otherwise determined by the board.
(2) The term shall not include costs paid by a terminal
operator applicant or licensee related to:
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(i) Structural changes necessary to segregate the
video gaming area or maintain the security of video
gaming terminals and redemption terminals as required by
the board that do not exceed $2,500, provided, however
that any changes in excess of $2,500 may be shared
equally between the terminal applicant or licensee and
the establishment applicant or licensee.
(ii) Surveillance technology to monitor only the
video gaming area.
(iii) Making video gaming terminals operate at a
licensed establishment, including wiring and rewiring,
software updates, ongoing video gaming terminal
maintenance, redemption terminals, network connections,
site controllers and costs associated with communicating
with the central control computer system.
(iv) Installation of security and alarm system at an
establishment licensee's premises that are reasonably
necessary to protect video gaming terminals and
redemption terminals outside normal business hours,
provided that the cost does not exceed $1,000.
(v) Any requirement established by the board
regarding minimum standards for a video gaming area.
(vi) Any cosmetic renovations or improvements within
a video gaming area that are reasonably necessary, as
determined by the board, to provide a suitable
environment for players.
(vii) Fees established by the board to cover costs
associated with the mandatory employee training program
established under section 3706 (relating to compulsive
and problem gambling).
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"Institutional investor." A retirement fund administered by
a public agency for the exclusive benefit of Federal, State or
local public employees, investment company registered under the
Investment Company Act of 1940 (54 Stat. 789, 15 U.S.C. § 80a-1
et seq.), collective investment trust organized by banks under
Part Nine of the Rules of the Comptroller of the Currency,
closed-end investment trust, chartered or licensed life
insurance company or property and casualty insurance company,
banking and other chartered or licensed lending institution,
investment advisor registered under The Investment Advisers Act
of 1940 (54 Stat. 847, 15 U.S.C. § 80b-1 et seq.) and such other
person as the board may determine consistent with this part.
"Intermediary." A person, other than an individual, that:
(1) is a holding company with respect to a corporation
or other form of business organization, that holds or applies
for a license under this part; and
(2) is a subsidiary with respect to a holding company.
"Key employee." An individual employed by a manufacturer
licensee, supplier licensee, terminal operator licensee or
establishment licensee that is determined by the board to be a
director or department head or otherwise empowered to make
discretionary decisions that regulate the conduct of video
gaming.
"Law enforcement authority." The power to conduct
investigations of or to make arrests for criminal offenses.
"Licensed entity." A terminal operator licensee,
establishment licensee, manufacturer licensee or supplier
licensee.
"Licensed entity representative." A person, including an
attorney, agent or lobbyist, acting on behalf of or authorized
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to represent the interest of an applicant, licensee or other
person authorized by the board to engage in an act or activity
that is regulated under this part regarding a matter before or
that may reasonably be expected to come before the board.
"Licensed facility." As defined in section 1103 (relating to
definitions).
"Licensed gaming entity." As defined in section 1103.
"Licensed racing entity." As defined in 3 Pa.C.S. § 9301
(relating to definitions).
"Liquor establishment." A person that operates under a valid
liquor or malt or brewed beverage license under Article IV of
the act of April 12, 1951 (P.L.90, No.21), known as the Liquor
Code. The term does not include a grocery store, hotel,
nonprimary location or restaurant whose place of business is
located in a licensed facility.
"Manufacturer." A person that manufactures, builds,
rebuilds, fabricates, assembles, produces, programs, designs or
otherwise makes modifications to a video gaming terminal,
redemption terminal or associated equipment for use or play in
this Commonwealth for gaming purposes and provides such products
to a supplier.
"Manufacturer license." A license issued by the board
authorizing a manufacturer to manufacture or produce video
gaming terminals, redemption terminals or associated equipment
for use in this Commonwealth for gaming purposes.
"Manufacturer licensee." A manufacturer that obtains a
manufacturer license.
"Municipality." A city, township, borough or incorporated
town.
"Non-key employee." An individual employed by a terminal
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operator licensee who, unless otherwise designated by the board,
is not a key employee.
"Nonprimary location." As defined in 3 Pa.C.S. § 9301.
"Occupation license." A license authorizing an individual to
be employed or to work as a gaming employee.
"Party." The bureau or an applicant, licensee, registrant or
other person appearing of record in any proceeding before the
board.
"Permittee." A holder of a permit issued under this part.
"Person." A natural person, corporation, foundation,
organization, business trust, estate, limited liability company,
licensed corporation, trust, partnership, limited liability
partnership, association or other form of legal business entity.
"Player." An individual who wagers cash or a cash equivalent
in the play or operation of a video gaming terminal and the play
or operation of which may deliver or entitle the individual
playing or operating the video gaming terminal to receive cash
or a cash equivalent from a terminal operator licensee.
"Principal." An officer, director, person who directly holds
a beneficial interest in or ownership of the securities of an
applicant or licensee, person who has a controlling interest in
an applicant or licensee or has the ability to elect a majority
of the board of directors of a licensee or to otherwise control
a licensee, lender or other licensed financial institution of an
applicant or licensee, other than a bank or lending institution
which makes a loan or holds a mortgage or other lien acquired in
the ordinary course of business, underwriter of an applicant or
licensee or other person or employee of an applicant, terminal
operator licensee, manufacturer licensee or supplier licensee
deemed to be a principal by the board.
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"Procurement agent." A person that shares in the gross
terminal revenue or is otherwise compensated for the purpose of
soliciting or procuring a terminal placement agreement.
"Property Tax Relief Fund." The fund established in section
1409 (relating to Property Tax Relief Fund).
"Publicly traded corporation." A person, other than an
individual, that:
(1) has a class or series of securities registered under
the Securities Exchange Act of 1934 (48 Stat. 881, 15 U.S.C.
§ 78a et seq.);
(2) is a registered management company under the
Investment Company Act of 1940; or
(3) is subject to the reporting obligations imposed by
section 15(d) of the Securities Exchange Act of 1934 by
reason of having filed a registration statement that has
become effective under the Securities Act of 1933 (48 Stat.
74, 15 U.S.C. § 77a et seq.).
"Redemption terminal." The collective hardware, software,
communications technology and other ancillary equipment used to
facilitate the payment of cash or a cash equivalent to a player
as a result of playing a video gaming terminal.
"Security." As defined in the act of December 5, 1972
(P.L.1280, No.284), known as the Pennsylvania Securities Act of
1972.
"Slot machine." As defined in section 1103.
"State Treasurer." The State Treasurer of the Commonwealth.
"Subsidiary." A person other than an individual. The term
includes:
(1) a corporation, a significant part of whose
outstanding equity securities are owned, subject to a power
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or right of control or held with power to vote by a holding
company or an intermediary company;
(2) a significant interest in a person, other than an
individual, that is owned, subject to a power or right of
control or held with power to vote by a holding company or an
intermediary company; or
(3) a person deemed to be a subsidiary by the board.
"Supplier." A person that sells, leases, offers or otherwise
provides, distributes or services any video gaming terminal,
redemption terminal or associated equipment to a terminal
operator licensee for use or play in this Commonwealth.
"Supplier license." A license issued by the board
authorizing a supplier to provide products or services related
to video gaming terminals, redemption terminals or associated
equipment to terminal operator licensees for use in this
Commonwealth for gaming purposes.
"Supplier licensee." A supplier that holds a supplier
license.
"Terminal operator." A person that owns, services or
maintains video gaming terminals for placement and operation in
an establishment licensee.
"Terminal operator license." A license issued by the board
authorizing a terminal operator to place and operate video
gaming terminals in an establishment licensee's premises
pursuant to this part and the rules and regulations promulgated
under this part.
"Terminal operator licensee." A terminal operator that holds
a terminal operator license.
"Terminal placement agreement." The formal written agreement
or contract between a terminal operator applicant or licensee
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and an establishment applicant or licensee that establishes the
terms and conditions regarding the conduct of video gaming.
"Truck stop establishment." A premises that:
(1) Is equipped with diesel islands used for fueling
commercial motor vehicles.
(2) Has sold on average 50,000 gallons of diesel or
biodiesel fuel each month for the previous 12 months or is
projected to sell an average of 50,000 gallons of diesel or
biodiesel fuel each month for the next 12 months.
(3) Has parking spaces dedicated for commercial motor
vehicles.
(4) Has a convenience store.
(5) Is situated on a parcel of land of not less than
three acres that the truck stop establishment owns or leases.
"Video gaming area." The area of an establishment licensee's
premises where video gaming terminals are installed for
operation and play.
"Video gaming employees." The term includes key employees
and non-key employees.
"Video Gaming Fund." The fund established in section 4102
(relating to taxes and assessments).
"Video gaming terminal."
(1) A mechanical or electrical contrivance, terminal,
machine or other device approved by the board that, upon
insertion of cash or cash equivalents, is available to play
or operate one or more gambling games, the play of which is
primarily based on chance and:
(i) May award a winning player either a free game or
credit that shall only be redeemable for cash or cash
equivalents at a redemption terminal.
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(ii) May utilize video displays.
(iii) May use an electronic credit system for
receiving wagers and making payouts that are only
redeemable at a redemption terminal.
(2) Associated equipment necessary to conduct the
operation of the contrivance, terminal, machine or other
device.
(3) The term does not include a slot machine operated at
a licensed facility in accordance with Part II (relating to
gaming) or a coin-operated amusement game.
CHAPTER 33
ADMINISTRATION
Sec.
3301. Powers of board.
3302. Regulatory authority of board.
3303. Temporary regulations.
3304. Appeals.
3305. Records and confidentiality of information.
3306. Reporting.
3307. Diversity goals of board.
3308. Authority of department.
3309. Central control computer system.
3310. Department of Drug and Alcohol Programs.
§ 3301. Powers of board.
(a) General powers.--
(1) The board shall have general and sole regulatory
authority over the conduct of video gaming terminal or
related activities as described in this part. The board shall
ensure the integrity of the acquisition and operation of
video gaming terminals, redemption terminals and associated
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equipment and shall have sole regulatory authority over every
aspect of the authorization, operation and play of video
gaming terminals.
(2) The board may employ individuals as necessary to
carry out the requirements of this part who shall serve at
the board's pleasure.
(b) Specific powers.--The board shall have the power and
duty:
(1) To require background investigations on applicants,
licensees, principals, key employees, procurement agents or
gaming employees under the jurisdiction of the board.
(2) At its discretion, to issue, approve, renew, revoke,
suspend, condition or deny issuance or renewal of terminal
operator licenses.
(3) At its discretion, to award, revoke, suspend,
condition or deny issuance or renewal of establishment
licenses.
(4) At its discretion, to issue, approve, renew, revoke,
suspend, condition or deny issuance or renewal of supplier
and manufacturer licenses.
(5) At its discretion, to issue, approve, renew, revoke,
suspend, condition or deny issuance or renewal of a license
or permit for various classes of employees as required under
this part.
(6) At its discretion, to issue, approve, renew, revoke,
suspend, condition or deny issuance or renewal of additional
licenses or permits that may be required by the board under
this part.
(7) At its discretion, to suspend, condition or deny the
issuance or renewal of a license or permit or levy a fine or
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other sanction for a violation of this part.
(8) To require prospective and existing video gaming
employees, independent contractors, applicants and licensees
to submit to fingerprinting by the Pennsylvania State Police.
The Pennsylvania State Police shall submit the fingerprints
to the Federal Bureau of Investigation for purposes of
verifying the identity of the individual and obtaining
records of criminal arrests and convictions.
(9) To require prospective and existing video gaming
employees, independent contractors, applicants and licensees
to submit photographs consistent with the standards of the
Commonwealth Photo Imaging Network.
(10) In addition to the power of the board relating to
license and permit applicants, to determine at its discretion
the suitability of a person who furnishes or seeks to furnish
to a terminal operator licensee directly or indirectly goods,
services or property related to video gaming terminals,
redemption terminals or associated equipment.
(11) To approve an application for or issue or renew a
license, certificate, registration or permit if the board is
satisfied that the applicant or licensee has demonstrated by
clear and convincing evidence that the applicant is a person
of good character, honesty and integrity whose prior
activities, criminal record, if any, reputation, habits and
associations do not pose a threat to the public interest or
the effective regulation and control of video gaming terminal
operations or create or enhance the danger of unsuitable,
unfair or illegal practices, methods and activities in the
conduct of video gaming or the carrying on of the business
and financial arrangements incidental thereto.
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(12) To publish each January in the Pennsylvania
Bulletin and on the board's publicly accessible Internet
website a complete list of persons or entities who applied
for or held a terminal operator license, establishment
license, manufacturer license or supplier license at any time
during the preceding calendar year and affiliates,
intermediaries, subsidiaries and holding companies thereof
and the status of the application or license.
(13) To prepare and, through the Governor, submit
annually to the General Assembly an itemized budget
consistent with Article VI of the act of April 9, 1929
(P.L.177, No.175), known as The Administrative Code of 1929,
consisting of the amounts necessary to be appropriated by the
General Assembly out of the accounts established under
section 4104 (relating to regulatory assessments) required to
meet the obligations under this part accruing during the
fiscal period beginning July 1 of the following year. The
budget shall include itemized recommendations for the
Attorney General, the department and the Pennsylvania State
Police as to the amount needed to meet their obligations
under this part.
(14) In the event that appropriations for the
administration of this part are not enacted by June 30 of any
year, funds appropriated for the administration of this part
which are unexpended, uncommitted and unencumbered at the end
of a fiscal year shall remain available for expenditure by
the board or other agency to which they were appropriated
until the enactment of an appropriation for the ensuing
fiscal year.
(15) To collect and post information on the board's
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publicly accessible Internet website with sufficient detail
to inform the public of persons with a controlling interest
or ownership interest in an applicant for a terminal operator
license or terminal operator licensee or affiliate,
intermediary, subsidiary or holding company of an applicant
for a terminal operator license. The posting shall include:
(i) If the applicant for a terminal operator license
or terminal operator licensee or an affiliate,
intermediary, subsidiary or holding company of the
applicant for a terminal operator license or terminal
operator licensee is a publicly traded domestic or
foreign corporation, partnership, limited liability
company or other legal entity, the names of persons with
a controlling interest.
(ii) If the applicant for a terminal operator
license or terminal operator licensee or an affiliate,
intermediary, subsidiary or holding company of the
applicant for a terminal operator license or terminal
operator licensee is a privately held domestic or foreign
corporation, partnership, limited liability company or
other legal entity, the names of all persons with an
ownership interest equal to or greater than 1%.
(iii) The name of a person entitled to cast the vote
of a person named under subparagraph (i) or (ii).
(iv) The names of officers, directors and principals
of the applicant for a terminal operator license or
terminal operator licensee.
(16) Determine, designate and classify employees of a
terminal operator licensee as key employees and non-key
employees.
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§ 3302. Regulatory authority of board.
(a) General rule.--The board shall have the power and duty:
(1) To deny, deny the renewal, revoke, condition or
suspend a license provided for in this part if the board
finds in its sole discretion that a licensee under this part
or its officers, employees or agents have intentionally
furnished false or misleading information to the board or
failed to comply with the provisions of this part or the
rules and regulations of the board and that it would be in
the public interest to deny, deny the renewal, revoke,
condition or suspend the license.
(2) To restrict access to confidential information in
the possession of the board that has been obtained under this
part and ensure that the confidentiality of information is
maintained and protected. The board shall retain records for
seven years.
(3) To prescribe and require periodic financial
reporting and internal control requirements for terminal
operator licensees.
(4) To require that each terminal operator licensee
provide to the board its annual financial statements, with
such additional detail as the board from time to time shall
require, which information shall be submitted not later than
90 days after the end of the licensee's fiscal year.
(5) To prescribe the procedures to be followed by
terminal operator licensees for a financial event that occurs
in the operation and play of video gaming terminals.
(6) To require that each establishment licensee
prohibits minors from operating or using video gaming
terminals or redemption terminals.
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(7) To establish procedures for the inspection and
certification of compliance of video gaming terminals,
redemption terminals and associated equipment prior to being
placed into use by a terminal operator licensee.
(8) To require that no video gaming terminal may be set
to pay out less than the theoretical payout percentage, which
percentage shall be no less than 85%, as specifically
approved by the board. The board shall adopt regulations that
define the theoretical payout percentage of a video gaming
terminal game based on the total value of the jackpots
expected to be paid by a play on a video gaming terminal game
divided by the total value of video gaming terminals wagers
expected to be made on that play or video gaming terminal
game during the same portion of the game cycle. In so doing,
the board shall specify whether the calculation includes a
portion of or the entire cycle of a video gaming terminal
game.
(9) To require that an establishment license applicant
provide detailed site plans of its proposed video gaming area
for review and approval by the board for the purpose of
determining the adequacy of the proposed security and
surveillance measures. The applicant shall cooperate with the
board in making changes to the plans suggested by the board
and shall ensure that the plans as modified and approved are
implemented. The board may not require a floor-to-ceiling
wall to segregate the video gaming area, but may adopt rules
to establish segregation requirements.
(10) To consult with members of the Pennsylvania State
Police, the Office of Attorney General, the department and
other persons the board deems necessary for advice regarding
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the various aspects of the powers and duties imposed on the
board under this part and the board's jurisdiction over the
authorization, operation and play of video gaming terminals.
(11) To enter into contracts with persons for the
purposes of carrying out the powers and duties of the board
under this part.
(12) To adopt regulations governing the postemployment
limitations and restrictions applicable to members and
employees of the board subject to section 4302 (relating to
additional board restrictions). In developing the
regulations, the board may consult with the State Ethics
Commission, governmental agencies and the disciplinary board
of the Supreme Court regarding postemployment limitations and
restrictions on members and employees of the board who are
members of the Pennsylvania Bar.
(13) To review and approve all cash handling policies
and procedures employed by terminal operator licensees.
(14) To establish the minimum amount of insurance
coverage for:
(i) each terminal operator licensee for a video
gaming terminal placed in a video gaming area; and
(ii) each establishment licensee for a video gaming
terminal located on the establishment licensee's
premises.
(15) To promulgate rules and regulations governing the
placement of automated teller machines within video gaming
areas.
(16) To establish reasonable age-verification procedures
for establishment licensees and their employees to ensure
minors do not access a video gaming area or terminal,
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provided that the board may not require video gaming
terminals to be equipped with identification card-reading
devices or require establishment licensees to purchase
identification card-reading devices.
(17) To promulgate rules and regulations governing
customer loyalty or rewards card programs operated by
terminal operator licensees.
(18) To promulgate rules and regulations governing the
interconnection of video gaming terminals with a single
establishment for progressive payouts.
(19) To promulgate rules and regulations necessary for
the administration and enforcement of this part.
(b) Applicable law.--Except as provided in section 3303
(relating to temporary regulations), regulations shall be
adopted the act of July 31, 1968 (P.L.769, No.240), referred to
as the Commonwealth Documents Law, and the act of June 25, 1982
(P.L.633, No.181), known as the Regulatory Review Act.
§ 3303. Temporary regulations.
(a) Promulgation.--In order to facilitate the prompt
implementation of this part, regulations promulgated by the
board shall be deemed temporary regulations which shall expire
no later than three years following the effective date of this
section. The board may promulgate temporary regulations not
subject to:
(1) Sections 201, 202 and 203 of the act of July 31,
1968 (P.L.769, No.240), referred to as the Commonwealth
Documents Law.
(2) The act of June 25, 1982 (P.L.633, No.181), known as
the Regulatory Review Act.
(b) Expiration.--The authority provided to the board to
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adopt temporary regulations in subsection (a) shall expire July
1, 2020. Regulations adopted after that date shall be
promulgated as provided by law.
(c) Special consideration.--When promulgating temporary
regulations regarding the application, background investigation
and renewal process for an establishment license or regulations
regarding an establishment licensee's duties and
responsibilities regarding the conduct of video gaming under
this part, the board shall consider promulgating regulations
that minimize the regulatory burden on establishment licensees
and establishment license applicants to the extent that:
(1) All requirements, duties and responsibilities are
fulfilled under this part.
(2) The temporary regulations adequately protect the
public interest and integrity of video gaming.
§ 3304. Appeals.
An applicant or licensee may appeal a final order,
determination or decision of the board involving the approval,
issuance, denial, revocation, nonrenewal, suspension or
conditioning, including any disciplinary actions, of a license,
permit or authorization under this part in accordance with 2
Pa.C.S. Chs. 5 Subch. A (relating to practice and procedure of
Commonwealth agencies) and 7 Subch. A (relating to judicial
review of Commonwealth agency action).
§ 3305. Records and confidentiality of information.
(a) Records.--The board shall maintain files and records
deemed necessary for the administration and enforcement of this
part.
(b) Confidentiality of information.--
(1) The following information submitted by an applicant
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or licensee under Chapter 35 (relating to application and
licensure) or obtained by the board or the bureau as part of
a background or other investigation from any source shall be
confidential and withheld from public disclosure:
(i) Information relating to character, honesty and
integrity, including family, habits, reputation, history
of criminal activity, business activities, financial
affairs and business, professional and personal
associations submitted to or otherwise obtained by the
board or the bureau.
(ii) Nonpublic personal information, including home
addresses, telephone numbers and other personal contact
information, Social Security numbers, educational
records, memberships, medical records, tax returns and
declarations, actual or proposed compensation, financial
account records, creditworthiness or financial condition
relating to an applicant or licensee or the immediate
family thereof.
(iii) Information relating to proprietary
information, trade secrets, patents or exclusive
licenses, architectural and engineering plans and
information relating to competitive marketing materials
and strategies, including customer-identifying
information or customer prospects for services subject to
competition.
(iv) Security information, including risk prevention
plans, detection and countermeasures, location of count
rooms, emergency management plans, security and
surveillance plans, equipment and usage protocols and
theft and fraud prevention plans and countermeasures.
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(v) Information with respect to which there is a
reasonable possibility that public release or inspection
of the information would constitute an unwarranted
invasion into personal privacy of an individual as
determined by the board.
(vi) Records of an applicant or licensee not
required to be filed with the Securities and Exchange
Commission by issuers that either have securities
registered under section 12 of the Securities Exchange
Act of 1934 (48 Stat. 881, 15 U.S.C. § 78l) or are
required to file reports under section 15(d) of the
Securities Exchange Act of 1934 (48 Stat. 881, 15 U.S.C.
§ 78o).
(vii) Records considered nonpublic matters or
information by the Securities and Exchange Commission as
provided by 17 CFR 200.80 (relating to commission records
and information).
(viii) Financial information provided to the board
by an applicant or licensee.
(2) No claim of confidentiality may be made regarding
criminal history record information that is available to the
public under 18 Pa.C.S. § 9121(b) (relating to general
regulations).
(3) No claim of confidentiality may be made regarding a
record in possession of the board that is otherwise publicly
available from a Commonwealth agency, local agency or another
jurisdiction.
(4) Except as provided in section 3904(h) (relating to
investigations and enforcement), the information made
confidential under this section shall be withheld from public
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disclosure in whole or in part, except that confidential
information shall be released upon the order of a court of
competent jurisdiction or, with the approval of the Attorney
General, to a duly authorized law enforcement agency or shall
be released to the public, in whole or in part, to the extent
that the release is requested by an applicant or licensee and
does not otherwise contain confidential information about
another person.
(5) The board may seek a voluntary waiver of
confidentiality from an applicant or licensee but may not
require an applicant or licensee to waive the confidentiality
provided under this subsection as a condition for the
approval of an application, renewal of a license or other
action of the board.
(6) (i) No current or former member and no current or
former employee, agent or independent contractor of the
board, the department, the Pennsylvania State Police, the
Office of Attorney General or other executive branch
office who has obtained confidential information in the
performance of duties under this part shall intentionally
and publicly disclose the information to a person,
knowing that the information being disclosed is
confidential under this subsection, unless the person is
authorized by law to receive it.
(ii) A violation of this subsection shall constitute
a misdemeanor of the third degree.
(iii) In addition to any penalty under subparagraph
(ii), an employee, agent or independent contractor who
violates this subsection shall be administratively
disciplined by discharge, suspension, termination of
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contract or other formal disciplinary action as
appropriate. If a current member violates this paragraph,
the other members shall refer the matter to the current
member's appointing authority.
(c) Notice.--Notice of the contents of information, except
to a duly authorized law enforcement agency pursuant to this
section, shall be given to an applicant or licensee in a manner
prescribed by the rules and regulations adopted by the board.
(d) Information held by other agencies.--Files, records,
reports and other information in the possession of the
department or the Pennsylvania Liquor Control Board pertaining
to a licensee shall be made available to the board as may be
necessary to the effective administration of this part.
§ 3306. Reporting.
(a) Report required.--Beginning October 1, 2018, and every
year thereafter, the annual report submitted to the Governor and
the General Assembly by the board under section 1211 (relating
to reports of board) shall include information on the conduct of
video gaming terminals for the previous calendar year:
(1) Total gross terminal revenue.
(2) Total number of terminal operator licensees and
establishment licensees.
(3) All taxes, fees, fines and other revenue collected
and, where appropriate, revenue disbursed. The department
shall collaborate with the board to carry out the
requirements of this paragraph.
(4) Other information related to the conduct of video
gaming terminals that the board deems appropriate.
(b) Participation.--The board may require terminal operator
licensees to provide information to the board to assist in the
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preparation of the report.
§ 3307. Diversity goals of board.
(a) Intent.--It is the intent and goal of the General
Assembly that the board promote and ensure diversity in all
aspects of the gaming activities authorized under this part.
(b) Reports by applicants.--An applicant for a terminal
operator license shall submit a diversity plan to the board. At
a minimum, the diversity plan shall contain a summary of:
(1) All employee recruitment and retention efforts
undertaken to promote the participation of diverse groups in
employment with the applicant if issued a terminal operator
license.
(2) Other information deemed necessary by the board to
assess the diversity plan.
(c) Review.--The board shall conduct a review of a diversity
plan. When reviewing the adequacy of a diversity plan, the board
shall take into consideration the total number of video gaming
terminals the applicant proposes to operate within the
Commonwealth.
(d) Periodic review.--Upon an applicant receiving a terminal
operator license, the board, in its discretion, may periodically
review the terminal operator licensee's diversity plan and
recommend changes to the diversity plan.
(e) Terminal operator responsibility.--An applicant for a
terminal operator license or a terminal operator licensee shall
provide information as required by the board to enable the board
to complete the reviews required under subsections (c) and (d).
§ 3308. Authority of department.
(a) General rule.--The department shall administer and
collect taxes imposed under this part and interest imposed under
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section 806 of the act of April 9, 1929 (P.L.343, No.176), known
as The Fiscal Code, and promulgate and enforce rules and
regulations to carry out its prescribed duties in accordance
with this part, including the collection of taxes, penalties and
interest imposed by this part.
(b) Application of rules and regulations.--The department
may prescribe the extent, if any, to which any rules and
regulations shall be applied without retroactive effect. The
department shall prescribe the forms and the system of
accounting and recordkeeping to be employed and through its
representative shall at all times have power of access to and
examination and audit of any equipment and records relating to
all aspects of the operation of video gaming terminals and
redemption terminals under this part.
(c) Procedure.--For purposes of implementing this part, the
department may promulgate regulations in the same manner in
which the board is authorized as provided in section 3303
(relating to temporary regulations).
(d) Additional penalty.--A person who fails to timely remit
to the department or the State Treasurer amounts required under
this part shall be liable, in addition to liability imposed
elsewhere in this part, to a penalty of 5% per month up to a
maximum of 25% of the amounts ultimately found to be due, to be
recovered by the department.
(e) Liens and suits for taxes.--The provisions of this part
shall be subject to the provisions of sections 242 and 243 of
the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform
Code of 1971.
§ 3309. Central control computer system.
(a) General rule.--To facilitate the auditing and security
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programs critical to the integrity of video gaming terminals in
this Commonwealth, the department shall have overall control of
video gaming terminals and all video gaming terminals:
(1) Shall be linked, at an appropriate time to be
determined by the department, to a central control computer
under the control of the department and accessible by the
board to provide auditing program capacity and individual
terminal information as approved by the department.
(2) Shall include real-time information retrieval and
terminal activation and disabling programs.
(b) System requirements.--The central control computer
employed by the department shall provide:
(1) A fully operational Statewide video gaming terminal
control system that has the capability of supporting up to
the maximum number of video gaming terminals that is
permitted to be in operation under this part.
(2) The employment of a widely accepted gaming industry
protocol to facilitate a video gaming terminal manufacturers'
ability to communicate with the Statewide system.
(3) The delivery of a system that has the ability to
verify software, detect alterations in payout and detect
other methods of fraud in all aspects of the operation of
video gaming terminals.
(4) The delivery of a system that has the capability to
support progressive video gaming terminals as approved by the
board.
(5) The delivery of a system that does not alter the
statistical awards of video gaming terminal games as designed
by the manufacturer and approved by the board.
(6) The delivery of a system that provides redundancy so
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that each component of the network is capable of operating
independently by the department if any component of the
network, including the central control computer, fails or
cannot be operated for any reason as determined by the
department, and to assure that all transactional data is
captured and secured. Costs associated with a computer system
required by the department to operate within a video gaming
area, whether independent or as part of the central control
computer, shall be paid by the terminal operator licensee.
The computer system shall be controlled by the department and
accessible to the board.
(7) The ability to meet all reporting and control
requirements as prescribed by the board and department.
(8) The delivery of a system that provides centralized
issuance of cash redemption tickets and facilitates the
acceptance of the tickets by video gaming terminals and
redemption terminals.
(9) Other capabilities as determined by the department
in consultation with the board.
(c) Personal information.--The central control computer may
not provide for the monitoring or reading of personal or
financial information concerning a patron of a terminal operator
licensee.
(d) Initial acquisition of central control computer.--
(1) Notwithstanding any other provision of law to the
contrary and in order to facilitate the prompt implementation
of this part, initial contracts entered into by the
department for a central control computer, including
necessary computer hardware, software, licenses or related
services shall not be subject to the provisions of 62 Pa.C.S.
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(relating to procurement).
(2) Contracts made pursuant to the provisions of this
section may not exceed five years.
(e) Resolution of contract disputes.--The process specified
in 62 Pa.C.S. Ch. 17 Subch. B (relating to prelitigation
resolution of controversies) shall be the sole means of
resolution for controversies arising with respect to contracts
executed under this section.
(f) Existing central control computer system.--The
department, in its discretion, may alter or utilize the central
control computer system controlled by the department under
section 1323 (relating to central control computer system) to
fulfill the requirements of this section.
§ 3310. Department of Drug and Alcohol Programs.
(a) Program update.--
(1) The Department of Drug and Alcohol Programs shall
update the compulsive and problem gambling program
established in section 1509 (relating to compulsive and
problem gambling program) to address public education,
awareness and training regarding compulsive and problem
gambling and the treatment and prevention of compulsive and
problem gambling related to video gaming terminals.
(2) The updated guidelines shall include strategies for
the prevention of compulsive and problem gambling related to
video gaming terminals.
(3) The Department of Drug and Alcohol Programs may
consult with the board and terminal operator licensee to
develop the strategies.
(b) Duties of Department of Drug and Alcohol Programs.--From
funds available in the Compulsive and Problem Gambling Treatment
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Fund, the Department of Drug and Alcohol Programs shall with
respect to video gaming terminals:
(1) Maintain one compulsive gamblers assistance
organization's toll-free problem gambling telephone number,
which number shall be 1-800-GAMBLER, to provide crisis
counseling and referral services to individuals and families
experiencing difficulty as a result of problem or compulsive
gambling. If the Department of Drug and Alcohol Programs
determines that it is unable to adopt the number 1-800-
GAMBLER, the Department of Drug and Alcohol Programs shall
maintain another number.
(2) Maintain one compulsive gambler's assistance
organization's telephone number, which shall be accessible
via a free text message service, to provide crisis counseling
and referral services to individuals and families
experiencing difficulty as a result of problem or compulsive
gambling.
(3) Facilitate, through in-service training and other
means, the availability of effective assistance programs for
problem and compulsive gamblers and family members affected
by problem and compulsive gambling.
(4) At its discretion, conduct studies to identify
individuals in this Commonwealth who are or are at risk of
becoming problem or compulsive gamblers.
(5) Provide grants to and contract with single county
authorities and other organizations that provide services
specified in this section.
(6) Reimburse organizations for reasonable expenses
incurred assisting the Department of Drug and Alcohol
Programs with implementing this section.
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(c) Additional duties.--Within 60 days following the
effective date of this section, the Department of Drug and
Alcohol Programs and the board's Office of Compulsive and
Problem Gambling shall jointly collaborate with other
appropriate offices and agencies of State or local government,
including single county authorities and providers and other
persons, public or private, with expertise in compulsive and
problem gambling treatment with respect to video gaming
terminals:
(1) Implement a strategic plan for the prevention and
treatment of compulsive and problem gambling.
(2) Adopt compulsive and problem gambling treatment
standards to be integrated with the Department of Drug and
Alcohol Programs' uniform Statewide guidelines that govern
the provision of addiction treatment services.
(3) Develop a method to coordinate compulsive and
problem gambling data collection and referral information to
crisis response hotlines, child welfare and domestic violence
programs and providers and other appropriate programs and
providers.
(4) Develop and disseminate educational materials to
provide public awareness related to the prevention,
recognition and treatment of compulsive and problem gambling.
(5) Develop demographic-specific compulsive and problem
gambling prevention, intervention and treatment programs.
(6) Prepare an itemized budget outlining how funds will
be allocated to fulfill the responsibilities under this
section.
(d) Report.--The Department of Drug and Alcohol Programs
shall include in the report required under section 1509
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information involving video gaming terminals.
CHAPTER 35
APPLICATION AND LICENSURE
Sec.
3501. General prohibition.
3502. Terminal operator licenses.
3503. (Reserved).
3504. Principal licenses.
3505. Key employee licenses.
3505.1. Procurement agent licenses.
3506. Divestiture of disqualifying applicant.
3507. Supplier licenses.
3508. Manufacturer licenses.
3509. Gaming service provider.
3510. Occupation license.
3511. Alternative terminal operator licensing standards.
3512. Alternative manufacturer licensing standards.
3513. Alternative supplier licensing standards.
3514. Establishment licenses.
3515. License or permit prohibition.
3516. Issuance and renewal.
3517. Change in ownership or control of terminal operator
licensee.
3518. Video gaming accounting controls and audits.
3519. Multiple licenses prohibited.
3520. Conditional licenses.
§ 3501. General prohibition.
No person may offer or otherwise make available for play in
this Commonwealth a video gaming terminal unless the person is
licensed under this part and according to regulations
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promulgated by the board under this part.
§ 3502. Terminal operator licenses.
(a) General requirements.--An application for a terminal
operator license shall be on the form required by the board and
shall include, at a minimum, all of the following:
(1) The name, address and photograph of the applicant
and of all directors and owners and key employees and their
positions within the corporation or organization, as well as
additional financial information required by the board.
(2) A current tax lien certificate issued by the
department.
(3) The details of any gaming license applied for,
granted to or denied to the applicant by another jurisdiction
where the form of gaming is legal and the consent for the
board to acquire copies of the application submitted or
license issued in connection with the application.
(4) The details of any loan obtained from a financial
institution or not obtained from a financial institution.
(5) The consent to conduct a background investigation by
the board, the scope of which investigation shall be
determined by the board in its discretion consistent with the
provisions of this part, and a release signed by all persons
subject to the investigation of all information required to
complete the investigation.
(6) The details of the applicant's diversity plan to
assure that all persons are accorded equality of opportunity
in employment and contracting by the applicant, its
contractors, subcontractors, assignees, lessees, agents,
vendors and suppliers.
(7) Any other information determined to be appropriate
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by the board.
(b) Character requirements.--
(1) An application for a terminal operator license shall
include such information, documentation and assurances as may
be required to establish by clear and convincing evidence of
the applicant's suitability, including good character,
honesty and integrity. The application shall include, without
limitation, information pertaining to family, habits,
character, reputation, criminal history background, business
activities, financial affairs and business, professional and
personal associates, covering at least the 10-year period
immediately preceding the filing date of the application.
(2) Notwithstanding 18 Pa.C.S. § 9124(b) (relating to
use of records by licensing agencies), in addition to the
information submitted under section 1308(a.1) (relating to
applications for license or permit), a conviction that has
been expunged or overturned or for which a person has been
pardoned or an order of Accelerated Rehabilitative
Disposition has been issued shall be included with an
application.
(c) Civil judgments and law enforcement agency
information.--
(1) An applicant shall notify the board of any civil
judgment obtained against the applicant pertaining to
antitrust or security regulation laws of the Federal
Government, this Commonwealth or another state, jurisdiction,
province or country.
(2) An applicant shall produce a letter of reference
from law enforcement agencies having jurisdiction in the
applicant's place of residence and principal place of
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business, which letter of reference shall indicate that the
law enforcement agencies do not have any pertinent
information concerning the applicant or, if the law
enforcement agency does have information pertaining to the
applicant, shall specify the nature and content of that
information.
(3) If no letter of reference is received within 30 days
of the request, the applicant may submit a statement under
oath which is subject to the penalty for false swearing under
18 Pa.C.S. § 4903 (relating to false swearing) that the
applicant is or was during the period the activities were
conducted in good standing with the gaming or casino
enforcement or control agency.
(d) Gaming enforcement agency information.--
(1) If the applicant has held a gaming license in a
jurisdiction where gaming activities are permitted, the
applicant shall produce a letter of reference from the gaming
or casino enforcement or control agency specifying the
experiences of that agency with the applicant, the
applicant's associates and the applicant's gaming operation.
(2) If no letter of reference is received within 30 days
of the request, the applicant may submit a statement under
oath which is subject to the penalty for false swearing under
18 Pa.C.S. § 4903 that the applicant is or was during the
period the activities were conducted in good standing with
the gaming or casino enforcement or control agency.
(e) Agency records.--
(1) An applicant for a terminal operator license,
principal license or key employee license shall be required
to apply to each Federal agency deemed appropriate by the
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board or bureau for agency records under the Freedom of
Information Act (Public Law 89-554, 5 U.S.C. § 552)
pertaining to the applicant and provide the bureau with the
complete record received from the Federal agency.
(2) The board may issue a license to the applicant prior
to the receipt of information under this subsection.
(f) Additional eligibility requirements.--In order to be
eligible for a terminal operator license under this part, the
principals and key employees of the applicant must obtain a
license to meet the character requirements of this section or
other eligibility requirements established by the board.
(g) Classification system.--The board shall develop a
classification system for other agents, employees or persons who
directly or indirectly hold or are deemed to be holding debt or
equity securities or other financial interest in the applicant
and for other persons that the board considers appropriate for
review under this section.
(h) Related entities.--
(1) Except as provided in paragraph (2), no person shall
be eligible to receive a terminal operator license unless the
principals and key employees of each intermediary, subsidiary
or holding company of the person meet the requirements of
subsection (f).
(2) The board may require that lenders and underwriters
of intermediaries, subsidiaries or holding companies of a
terminal operator license applicant meet the requirements of
subsection (f) if the board determines that the suitability
of a lender or underwriter is at issue and necessary to
consider a pending application for a terminal operator
license.
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(i) Revocable privilege.--The issuance or renewal of a
license or other authorization by the board under this section
shall be a revocable privilege.
(j) Waiver for publicly traded corporations.--The board may
waive the requirements of subsection (f) for a person directly
or indirectly holding ownership of securities in a publicly
traded corporation if the board determines that the holder of
the securities:
(1) Is not significantly involved in the activities of
the corporation.
(2) Does not have the ability to control the corporation
or elect one or more directors thereof.
(k) Waiver for subsidiaries.--If the applicant is a
subsidiary, the board may waive the requirements of subsection
(f) for a holding company or intermediary as follows:
(1) If the applicant is a publicly traded corporation,
the board may issue a waiver under this subsection if it
determines that the principal or key employee does not have
the ability to control, have a controlling interest in or
elect one or more directors of the holding company or
intermediary and is not actively involved in the activities
of the applicant.
(2) If the applicant is a noncorporate organization, the
board may issue a waiver under this subsection for a person
who directly or indirectly holds a beneficial or ownership
interest in the applicant if it determines that the person
does not have the ability to control the applicant.
(l) Ongoing duty.--A person applying for a license or other
authorization under this part shall continue to provide
information required by the board or the bureau and cooperate in
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any inquiry or investigation.
(m) Criminal history record check.--The board may conduct a
criminal history record check on a person for whom a waiver is
granted under this section.
(n) Applicant financial information.--
(1) The board shall require an applicant for a terminal
operator license to produce the information, documentation
and assurances concerning financial background and resources
as the board deems necessary to establish by clear and
convincing evidence the financial stability, integrity and
responsibility of the applicant, its affiliate, intermediary,
subsidiary or holding company, including, but not limited to,
bank references, business and personal income and
disbursement schedules, tax returns and other reports filed
with governmental agencies and business and personal
accounting and check records and ledgers.
(2) An applicant shall in writing authorize the
examination of all bank accounts and records as may be deemed
necessary by the board.
(o) Financial backer information.--
(1) The board shall require an applicant for a terminal
operator license to produce the information, documentation
and assurances as may be necessary to establish by clear and
convincing evidence the integrity of all financial backers,
investors, mortgagees, bondholders and holders of indentures,
notes or other evidences of indebtedness, either in effect or
proposed.
(2) The board may waive the qualification requirements
for banking or lending institution and institutional
investors.
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(3) A banking or lending institution or institutional
investor shall produce for the board upon request any
document or information that bears relation to the proposal
submitted by the applicant or applicants.
(4) The integrity of the financial sources shall be
judged upon the same standards as the applicant. Any such
person or entity shall produce for the board upon request any
document or information which bears any relation to the
application.
(5) The applicant shall produce whatever information,
documentation or assurances the board requires to establish
by clear and convincing evidence the adequacy of financial
resources.
(p) Applicant's business experience.--
(1) The board shall require an applicant for a terminal
operator license to produce the information, documentation
and assurances as the board may require to establish by clear
and convincing evidence that the applicant has sufficient
business ability and experience to create and maintain a
successful, efficient operation.
(2) An applicant shall produce the names of all proposed
key employees and a description of their respective or
proposed responsibilities as they become known.
(q) Additional information.--In addition to other
information required by this part, a person applying for a
terminal operator license shall provide the following
information:
(1) The organization, financial structure and nature of
all businesses operated by the person, including any
affiliate, intermediary, subsidiary or holding companies, the
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names and personal employment and criminal histories of all
officers, directors and key employees of the corporation; the
names of all holding, intermediary, affiliate and subsidiary
companies of the corporation; and the organization, financial
structure and nature of all businesses operated by such
holding, intermediary and subsidiary companies as the board
may require, including names and personal employment and
criminal histories of such officers, directors and principal
employees of such corporations and companies as the board may
require.
(2) The extent of securities held in the corporation by
all officers, directors and underwriters and their
remuneration in the form of salary, wages, fees or otherwise.
(3) Copies of all management and service contracts.
(r) Review and approval.--Upon being satisfied that the
requirements of subsections (a), (b), (c), (d), (e), (f), (g),
(h), (i), (j), (k), (l), (m), (n), (o), (p) and (q) have been
met, the board may approve the application and issue the
applicant a terminal operator license consistent with all of the
following:
(1) (i) The initial license shall be for a period of
one year, and, if renewed under subsection (s), the board
shall have discretion to renew the license for a period
of up to three years.
(ii) Nothing in this paragraph shall be construed to
relieve a licensee of the affirmative duty to notify the
board of any changes relating to the status of its
license or to any information contained in the
application materials on file with the board.
(2) The license shall be nontransferable.
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(3) Any other condition established by the board.
(s) Renewal.--
(1) At least two months prior to expiration of a
terminal operator license, the terminal operator licensee
seeking renewal of its license shall submit a renewal
application to the board.
(2) If the renewal application satisfies the
requirements of subsections (a), (b), (c), (d), (e), (f),
(g), (h), (i), (j), (k), (l), (m), (n), (o), (p) and (q), the
board may renew the licensee's terminal operator license.
(3) If the board receives a complete renewal application
but fails to act upon the renewal application prior to the
expiration of the terminal operator license, the terminal
operator license shall continue in effect until acted upon by
the board.
§ 3503. (Reserved).
§ 3504. Principal licenses.
(a) License required.--All principals shall obtain a
principal license from the board.
(b) Application.--A principal license application shall be
in a form prescribed by the board and shall include the
following:
(1) Verification of status as a principal from a
terminal operator licensee, manufacturer licensee or supplier
licensee.
(2) A description of responsibilities as a principal.
(3) All releases necessary to obtain information from
governmental agencies, employers and other organizations.
(4) Fingerprints, which shall be submitted to the
Pennsylvania State Police.
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(5) A photograph that meets the standards of the
Commonwealth Photo Imaging Network.
(6) Details relating to a similar license, permit or
other authorization obtained in another jurisdiction.
(7) Additional information required by the board.
(c) Issuance.--Following review of the application and the
background investigation, the board may issue a principal
license if the applicant has proven by clear and convincing
evidence that the applicant is a person of good character,
honesty and integrity and is eligible and suitable to be
licensed as a principal.
(d) Nontransferability.--A license issued under this section
shall be nontransferable.
(e) Principals.--An individual who receives a principal
license need not obtain a key employee license.
§ 3505. Key employee licenses.
(a) License required.--All key employees shall obtain a key
employee license from the board.
(b) Application.--A key employee license application shall
be in a form prescribed by the board and shall include the
following:
(1) Verification of status as a key employee from a
terminal operator licensee, manufacturer licensee or supplier
licensee.
(2) A description of employment responsibilities.
(3) All releases necessary to obtain information from
governmental agencies, employers and other organizations.
(4) Fingerprints, which shall be submitted to the
Pennsylvania State Police.
(5) A photograph that meets the standards of the
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Commonwealth Photo Imaging Network.
(6) Details relating to a similar license or other
authorization obtained in another jurisdiction.
(7) Additional information required by the board.
(c) Issuance.--Following review of the application and the
background investigation, the board may issue a key employee
license if the applicant has proven by clear and convincing
evidence that the applicant is a person of good character,
honesty and integrity and is eligible and suitable to be
licensed as a key employee.
(d) Nontransferability.--A license issued under this section
shall be nontransferable.
§ 3505.1. Procurement agent licenses.
(a) License required.--All procurement agents shall obtain a
procurement agent license from the board.
(b) Application.--A procurement agent license application
shall be in a form prescribed by the board and shall include the
following:
(1) Verification of status as a procurement agent from a
terminal operator licensee.
(2) A description of responsibilities.
(3) All releases necessary to obtain information from
governmental agencies, employers and other organizations.
(4) Fingerprints, which shall be submitted to the
Pennsylvania State Police.
(5) A photograph that meets the standards of the
Commonwealth Photo Imaging Network.
(6) Details relating to a similar license or other
authorization obtained in another jurisdiction.
(7) Additional information required by the board.
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(c) Issuance.--Following review of the application and the
background investigation, the board may issue a procurement
agent license if the applicant has proven by clear and
convincing evidence that the applicant is a person of good
character, honesty and integrity and is eligible and suitable to
be licensed as a procurement agent.
(d) Nontransferability.--A license issued under this section
shall be nontransferable.
§ 3506. Divestiture of disqualifying applicant.
(a) Board power to require.--
(1) In the event that any establishment license
application, terminal operator license application, supplier
license application or manufacturer license application is
not approved by the board based on a finding that an
individual who is a principal or has an interest in the
person applying for the license does not meet the character
requirements of this part or any of the eligibility
requirements under this part or a person who purchases a
controlling interest in the applicant in violation of section
3517 (relating to change in ownership or control of terminal
operator licensee), the board may afford the individual the
opportunity to completely divest his interest in the person,
its affiliate, intermediary, subsidiary or holding company
seeking the license and, after such divestiture, reconsider
the person's or applicant's suitability for licensure in an
expedited proceeding and may, after such proceeding, issue
the person or applicant a terminal operator license.
(2) The board shall approve the terms and conditions of
any divestiture under this section.
(b) Limitation.--Under no circumstances shall any
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divestiture be approved by the board if the compensation for the
divested interest exceeds the cost of the interest.
§ 3507. Supplier licenses.
(a) Application.--
(1) A manufacturer that elects to contract with a
supplier under section 3508 (relating to manufacturer
licenses) shall ensure that the supplier is appropriately
licensed under this section.
(2) A person seeking to provide video gaming terminals,
redemption terminals or associated equipment to a terminal
operator licensee within this Commonwealth through a contract
with a licensed manufacturer must apply to the board for the
appropriate supplier license.
(b) Requirements.--An application for a supplier license
shall be on the form required by the board and shall include all
of the following:
(1) The name and business address of the applicant and
the applicant's affiliates, intermediaries, subsidiaries and
holding companies; the principals and key employees of each
business; and a list of employees and their positions within
each business, as well as financial information required by
the board.
(2) A statement that the applicant and each affiliate,
intermediary, subsidiary or holding company of the applicant
are not terminal operator licensees.
(3) Proof that the applicant has or will establish a
place of business in this Commonwealth. A supplier licensee
shall maintain its place of business in this Commonwealth to
remain eligible for licensure.
(4) The consent to a background investigation of the
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applicant, its principals and key employees or other persons
required by the board and a release to obtain the information
necessary for the completion of the background investigation.
(5) The details of any supplier license issued by the
board to the applicant under section 1317 (relating to
supplier licenses), if applicable.
(6) The details of any equivalent license granted or
denied by other jurisdictions where gaming activities as
authorized by this part are permitted.
(7) The type of goods and services to be supplied and
whether those goods and services will be provided through
purchase, lease, contract or otherwise.
(8) Other information determined by the board to be
appropriate.
(c) Review and approval.--Upon being satisfied that the
requirements of subsection (b) have been met, the board may
approve the application and issue the applicant a supplier
license consistent with all of the following:
(1) (i) The initial license shall be for a period of
one year, and, if renewed under subsection (d), the board
shall have discretion to renew the license for a period
up to three years.
(ii) Nothing in this paragraph shall be construed to
relieve a licensee of the affirmative duty to notify the
board of a change relating to the status of its license
or to information contained in the application materials
on file with the board.
(2) The license shall be nontransferable.
(3) Other conditions established by the board.
(d) Renewal.--
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(1) At least two months prior to expiration of a
supplier license, the supplier licensee seeking renewal of
its license shall submit a renewal application to the board.
(2) If the renewal application satisfies the
requirements of subsection (b), the board may renew the
licensee's supplier license.
(3) If the board receives a complete renewal application
but fails to act upon the renewal application prior to the
expiration of the supplier license, the supplier license
shall continue in effect until acted upon by the board.
§ 3508. Manufacturer licenses.
(a) Application.--A person seeking to manufacture video
gaming terminals, redemption terminals and associated equipment
for use in this Commonwealth must apply to the board for a
manufacturer license.
(b) Requirements.--An application for a manufacturer license
shall be on the form required by the board and shall include all
of the following:
(1) The name and business address of the applicant and
the applicant's affiliates, intermediaries, subsidiaries and
holding companies; the principals and key employees of each
business; and a list of employees and their positions within
each business, as well as financial information required by
the board.
(2) A statement that the applicant and each affiliate,
intermediary, subsidiary or holding company of the applicant
are not terminal operator licensees.
(3) The consent to a background investigation of the
applicant, its principals, its key employees, its
intermediaries, its subsidiaries or other persons required by
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the board and a release to obtain the information necessary
for the completion of the background investigation.
(4) The details of any equivalent license granted or
denied by other jurisdictions where gaming activities as
authorized by this part are permitted.
(5) The details of any manufacturer license issued by
the board to the applicant under section 1317.1 (relating to
manufacturer licenses), if applicable.
(6) The type of video gaming terminals, redemption
terminals or associated equipment to be manufactured or
repaired.
(7) Other information determined by the board to be
appropriate.
(c) Review and approval.--Upon being satisfied that the
requirements of subsection (b) have been met, the board may
approve the application and grant the applicant a manufacturer
license consistent with all of the following:
(1) (i) The initial license shall be for a period of
one year, and, if renewed under subsection (d), the board
shall have discretion to renew the license for a period
up to three years.
(ii) Nothing in this paragraph shall be construed to
relieve the licensee of the affirmative duty to notify
the board of a change relating to the status of its
license or to other information contained in application
materials on file with the board.
(2) The license shall be nontransferable.
(3) Other conditions established by the board.
(d) Renewal.--
(1) At least two months prior to expiration of a
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manufacturer license, the manufacturer licensee seeking
renewal of its license shall submit a renewal application
accompanied by the renewal fee to the board.
(2) If the renewal application satisfies the
requirements of subsection (b), the board may renew the
licensee's manufacturer license.
(3) If the board receives a complete renewal application
but fails to act upon the renewal application prior to the
expiration of the manufacturer license, the manufacturer
license shall continue in effect until acted upon by the
board.
(e) Authority.--The following shall apply to a licensed
manufacturer:
(1) A manufacturer or its designee, as licensed by the
board, may supply or repair a video gaming terminal,
redemption terminal or associated equipment manufactured by
the manufacturer, provided the manufacturer holds the
appropriate manufacturer license.
(2) A manufacturer of video gaming terminals or
redemption terminals may contract with a supplier under
section 3507 (relating to supplier licenses) to provide video
gaming terminals, redemption terminals or associated
equipment to a terminal operator licensee within this
Commonwealth, provided the supplier is licensed to supply
video gaming terminals, redemption terminals or associated
equipment.
(f) Prohibitions.--
(1) No person may manufacture video gaming terminals,
redemption terminals or associated equipment for use within
this Commonwealth by a terminal operator licensee unless the
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person has been issued the appropriate manufacturer license
under this section.
(2) No person issued a license under this section may
apply for or be issued a terminal operator license or
establishment license under section 1317 (relating to
supplier licenses).
§ 3509. Gaming service provider.
(a) Development of classification system.--The board shall
develop a classification system governing the certification,
registration and regulation of gaming service providers and
individuals and entities associated with them. The
classification system shall be based upon the following:
(1) Whether the employees of the gaming service provider
will have access to the video gaming area of an establishment
or the video gaming terminals or redemption terminals prior
to or after installation.
(2) Whether the goods or services provided or to be
provided by the gaming service provider would impact the
integrity of video gaming terminals, redemption terminals or
the conduct of video gaming.
(b) Authority to exempt.--The board may exempt a person or
type of business from the requirements of this section if the
board determines:
(1) the person or type of business is regulated by an
agency of the Federal Government, an agency of the
Commonwealth or the Pennsylvania Supreme Court; or
(2) the regulation of the person or type of business is
determined not to be necessary in order to protect the public
interest or the integrity of gaming.
(c) Duties of gaming service providers.--A gaming service
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provider shall have a continuing duty to:
(1) Provide all information, documentation and
assurances as the board may require.
(2) Cooperate with the board in investigations, hearings
and enforcement and disciplinary actions.
(3) Comply with all conditions, restrictions,
requirements, orders and rulings of the board in accordance
with this part.
(4) Report a change in circumstances that may render the
gaming service provider ineligible, unqualified or unsuitable
for continued registration or certification.
(d) Requirement for permit.--The board may require employees
of a gaming service provider to obtain a permit or other
authorization if, after an analysis of duties, responsibilities
and functions, the board determines that a permit or other
authorization is necessary to protect the integrity of gaming.
(e) Interim authorization.--The board or a designated
employee of the board may permit a gaming service provider
applicant to engage in business with an applicant for a terminal
operator license or a terminal operator licensee prior to
approval of the gaming service provider application if the
following criteria have been satisfied:
(1) A completed application has been filed with the
board by the gaming service provider.
(2) The terminal operator license applicant or terminal
operator licensee contracting or doing business with the
gaming service provider certifies that it has performed due
diligence on the gaming service provider and believes that
the applicant meets the qualification to be a gaming service
provider pursuant to this section.
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(3) The gaming service provider applicant agrees in
writing that the grant of interim authorization to conduct
business prior to board approval of the application does not
create a right to continue to engage in business if the board
determines that the applicant is not suitable or continued
authorization is not in the public interest.
(f) Construction.--Nothing in this section shall be
construed to prohibit the board from rescinding a grant of
interim authorization if, at any time, the suitability of the
person subject to interim authorization is at issue or if the
person fails to cooperate with the board, the bureau or an agent
of the board or bureau.
(g) Gaming service provider lists.--
(1) The board shall:
(i) Develop and maintain a list of approved gaming
service providers who are authorized to provide goods or
services whether under a grant of interim or continued
authorization.
(ii) Develop and maintain a list of prohibited
gaming service providers.
(2) An applicant for a terminal operator license or a
terminal operator licensee may not enter into an agreement or
engage in business with a gaming service provider listed on
the prohibited gaming service provider list.
(h) Emergency authorization.--
(1) A terminal operator licensee may utilize a gaming
service provider that has not been approved by the board when
a threat to public health, welfare or safety exists or
circumstances outside the control of the terminal operator
licensee require immediate action to mitigate damage or loss
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to the licensee's video gaming terminals.
(2) The board shall promulgate regulations to govern the
use of gaming service providers under emergency
circumstances. The regulations shall include a requirement
that the slot machine licensee contact the board immediately
upon utilizing a gaming service provider that has not been
approved by the board.
(i) Criminal history record information.--If the
classification system developed by the board in accordance with
subsection (a) requires a gaming service provider or an
individual or entity associated with the gaming service provider
to submit to or provide the bureau with criminal history record
information under 18 Pa.C.S. Ch. 91 (relating to criminal
history record information), the bureau shall notify a slot
machine licensee that submitted a certification under subsection
(e)(2) whether the applicant has been convicted of a felony or
misdemeanor gambling offense.
§ 3510. Occupation license.
(a) Application.--
(1) A person who desires to be a gaming employee and has
a bona fide offer of employment from a terminal operator
licensee shall apply to the board for an occupation license.
(2) A person may not be employed as a gaming employee
unless and until that person holds an appropriate occupation
license issued under this section.
(3) The board may promulgate regulations to reclassify a
category of nongaming employees or gaming employees upon a
finding that the reclassification is in the public interest
and consistent with the objectives of this part.
(b) Requirements.--The application for an occupation license
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shall include, at a minimum:
(1) The name and home address of the person.
(2) The previous employment history of the person.
(3) The criminal history record of the person, as well
as the person's consent for the Pennsylvania State Police to
conduct a background investigation.
(4) A photograph of the person.
(5) Evidence of the offer of employment and the nature
and scope of the proposed duties of the person, if known.
(6) The details of an occupation license or similar
license granted or denied to the applicant in other
jurisdictions.
(7) Other information determined by the board to be
appropriate.
(c) Prohibition.--No terminal operator licensee may employ
or permit a person under 18 years of age to render service in a
video gaming area.
§ 3511. Alternative terminal operator licensing standards.
(a) Determination.--
(1) The board may determine whether the licensing
standards of another jurisdiction within the United States or
Canada in which an applicant, its affiliate, intermediary,
subsidiary or holding company for a terminal operator license
is similarly licensed are comprehensive and thorough and
provide similar adequate safeguards as those required by this
part.
(2) If the board makes that determination, it may issue
a terminal operator license to an applicant who holds a
terminal operator license in the other jurisdiction after
conducting an evaluation of the information relating to the
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applicant from the other jurisdictions, as updated by the
board, and evaluating other information related to the
applicant received from that jurisdiction and other
jurisdictions where the applicant may be licensed, the board
may incorporate such information in whole or in part into the
board's evaluation of the applicant.
(b) Abbreviated process.--
(1) In the event an applicant for a terminal operator
license is licensed in another jurisdiction, the board may
determine to use an alternate process requiring only that
information determined by the board to be necessary to
consider the issuance of a license, including financial
viability of the licensee, to such an applicant.
(2) Nothing in this section shall be construed to waive
fees associated with obtaining a license through the normal
application process.
(c) Current license holders.--In the event an applicant for
a terminal operator license under this part holds a slot machine
license under Part II (relating to gaming), the board may
determine to use an abbreviated process requiring only that
information determined by the board to be necessary to consider
the issuance of a license, including financial viability of the
applicant.
§ 3512. Alternative manufacturer licensing standards.
(a) Determination.--
(1) The board may determine whether the licensing
standards of another jurisdiction within the United States in
which an applicant for a manufacturer license is similarly
licensed are comprehensive and thorough and provide similar
adequate safeguards as those required by this part.
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(2) If the board makes that determination, it may issue
a manufacturer license to an applicant who holds a similar
manufacturer license in the other jurisdiction after
conducting an evaluation of the information relating to the
applicant from the other jurisdictions, as updated by the
board, and evaluating other information related to the
applicant received from that jurisdiction and other
jurisdictions where the applicant may be licensed, the board
may incorporate such information in whole or in part into the
board's evaluation of the applicant.
(b) Abbreviated process.--
(1) In the event an applicant for a manufacturer license
is licensed in another jurisdiction, the board may determine
to use an abbreviated process requiring only that information
determined by the board to be necessary to consider the
issuance of a license, including financial viability of the
applicant.
(2) Nothing in this section shall be construed to waive
fees associated with obtaining a license through the normal
application process.
(c) Current license holders.--In the event an applicant for
a manufacturer license under this part holds a manufacturer
license under section 1317.1 (relating to manufacturer
licenses), the board may determine to use an abbreviated process
requiring only that information determined by the board to be
necessary to consider the issuance of a license, including
financial viability of the applicant.
§ 3513. Alternative supplier licensing standards.
(a) Determination.--
(1) The board may determine whether the licensing
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standards of another jurisdiction within the United States in
which an applicant for a supplier's license is similarly
licensed are comprehensive and thorough and provide similar
adequate safeguards as required by this part.
(2) If the board makes that determination, it may issue
a supplier license to an applicant who holds a similar
supplier license in another jurisdiction after conducting an
evaluation of the information relating to the applicant from
the other jurisdictions, as updated by the board, and
evaluating other information related to the applicant
received from that jurisdiction and other jurisdictions where
the applicant may be licensed. The board may incorporate the
information in whole or in part into its evaluation of the
applicant.
(b) Abbreviated process.--
(1) In the event an applicant for a supplier license is
licensed in another jurisdiction, the board may determine to
use an abbreviated process requiring only that information
determined by the board to be necessary to consider the
issuance of a license, including financial viability of the
applicant.
(2) Nothing in this section shall be construed to waive
any fees associated with obtaining a license through the
normal application process.
(c) Current license holders.--In the event an applicant for
a supplier license under this part holds a supplier license
under section 1317 (relating to supplier licenses), the board
may determine to use an abbreviated process requiring only that
information determined by the board to be necessary to consider
the issuance of a license, including financial viability of the
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applicant.
§ 3514. Establishment licenses.
(a) General requirements.--An establishment that submits an
application for an establishment license shall include at a
minimum:
(1) The name, address and photograph of the applicant
and additional financial information required by the board.
(2) A description of the proposed surveillance and
security measures to ensure the security of the proposed
video gaming area.
(3) A current tax lien certificate issued by the
department.
(4) The criminal history record of the applicant,
principal and key employees and a consent for the
Pennsylvania State Police to conduct a background
investigation on the applicant, principals and key employees.
(5) If the applicant is a liquor establishment,
documentation showing that the establishment's liquor or
retail dispenser license is valid and is in good standing
with the Pennsylvania Liquor Control Board.
(6) If the applicant is a liquor establishment,
disclosure of conditional license agreements entered into
under the act of April 12, 1951 (P.L.90, No.21), known as the
Liquor Code.
(7) Other information determined to be appropriate by
the board.
(b) Nontransferability.--A license issued under this section
shall be nontransferable.
(c) Ongoing duty.--An establishment applying for a license
under this section shall continue to provide information
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required by the board or the bureau and cooperate in any inquiry
or investigation.
(d) Review and approval.--Upon being satisfied that the
requirements of subsection (a) have been met, the board may
approve the application and issue the applicant an establishment
license consistent with all of the following:
(1) (i) The initial license shall be for a period of
one year, and, if renewed under subsection (d), the
license shall be for a period of one year.
(ii) Nothing in this paragraph shall be construed to
relieve a licensee of the affirmative duty to notify the
board of a change relating to the status of its license
or to information contained in application materials on
file with the board.
(2) The license shall be nontransferable.
(3) Other conditions established by the board.
(e) Renewal.--
(1) At least two months prior to expiration of an
establishment license, the establishment licensee seeking
renewal of its license shall submit a renewal application
accompanied by the renewal fee to the board.
(2) If the renewal application satisfies the
requirements of subsection (b), the board may renew the
licensee's establishment license.
(3) If the board receives a complete renewal application
but fails to act upon the renewal application prior to the
expiration of the manufacturer license, the establishment
license shall continue in effect until acted upon by the
board.
§ 3515. License or permit prohibition.
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The following apply:
(1) The board shall be prohibited from granting a
license or permit under this part to any applicant who has
been convicted of a felony offense in any jurisdiction.
(2) In addition to the prohibition under paragraph (1),
the board shall be prohibited from granting the following:
(i) A principal license or key employee license to
an individual who has been convicted in a jurisdiction of
a misdemeanor gambling offense, unless 15 years have
elapsed from the date of conviction for the offense.
(ii) A gaming employee permit or a license other
than a principal license or key employee license to an
individual who has been convicted in a jurisdiction of a
felony offense or of a misdemeanor gambling offense,
unless 15 years have elapsed from the date of conviction
for the offense.
(iii) An establishment license to an applicant who
has been convicted in a jurisdiction of a misdemeanor
gambling offense, unless three years have elapsed from
the date of conviction for the offense.
(iv) An establishment license to an applicant that
is a liquor establishment whose liquor or retail
dispenser license is not in good standing with the
Pennsylvania Liquor Control Board.
(v) An establishment license to an applicant that is
a liquor establishment that has been declared a nuisance
under section 611 of the act of April 12, 1951 (P.L.90,
No.21), known as the Liquor Code.
(vi) An establishment license to an applicant that
is a liquor establishment with a conditional license
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agreement entered into under the Liquor Code unless the
agreement has been amended to allow for video gaming.
(3) Following the expiration of any prohibition period
applicable to an applicant under paragraph (2), in
determining whether to issue a license or permit, the board
shall consider the following factors:
(i) The nature and duties of the applicant's
position with the licensed entity.
(ii) The nature and seriousness of the offense or
conduct.
(iii) The circumstances under which the offense or
conduct occurred.
(iv) The age of the applicant when the offense or
conduct was committed.
(v) Whether the offense or conduct was an isolated
or a repeated incident.
(vi) Evidence of rehabilitation, including good
conduct in the community, counseling or psychiatric
treatment received and the recommendation of persons who
have substantial contact with the applicant.
(4) For purposes of this section, a felony offense is
any of the following:
(i) An offense punishable under the laws of this
Commonwealth by imprisonment for more than five years.
(ii) An offense which, under the laws of another
jurisdiction, is:
(A) classified as a felony; or
(B) punishable by imprisonment for more than
five years.
(iii) An offense under the laws of another
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jurisdiction which, if committed in this Commonwealth,
would be subject to imprisonment for more than five
years.
§ 3516. Issuance and renewal.
(a) Issuance.--
(1) In addition to any other criteria provided under
this part, any terminal operator, establishment, supplier,
manufacturer, gaming employee or other person that the board
approves as qualified to receive a license or a permit under
this part shall be issued a license or permit upon the
payment of a fee required in section 4101 (relating to fees)
and upon the fulfillment of conditions required by the board
or provided for in this part.
(2) Nothing contained in this part is intended or shall
be construed to create an entitlement to a license or permit
by a person.
(b) Renewal.--
(1) All permits and licenses issued under this part
unless otherwise provided shall be subject to renewal every
year.
(2) The application for renewal shall be submitted at
least 60 days prior to the expiration of the permit or
license and shall include an update of the information
contained in the initial and any prior renewal applications
and the payment of any renewal fee required by section 4101.
(3) Nothing in this subsection shall be construed to
relieve a licensee of the affirmative duty to notify the
board of a change relating to the status of its license or to
other information contained in the application materials on
file with the board.
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(c) Revocation or failure to renew.--
(1) In addition to other sanctions the board may impose
under this part, the board may at its discretion suspend,
revoke or deny renewal of a permit or license issued under
this part if it receives information from any source that the
applicant or any of its officers, directors, owners or key
employees is in violation of any provision of this part, that
the applicant has furnished the board with false or
misleading information or that the information contained in
the applicant's initial application or renewal application is
no longer true and correct such that the applicant is no
longer eligible.
(2) In the event of a revocation or failure to renew,
the applicant's authorization to conduct the previously
approved activity shall immediately cease upon receipt of a
final adjudication under 2 Pa.C.S. Chs. 5 Subch. A (relating
to practice and procedure of Commonwealth agencies) and 7
Subch. A (relating to judicial review of Commonwealth agency
action), and all fees paid in connection with the application
shall be deemed to be forfeited.
(3) In the event of a suspension, the applicant's
authorization to conduct the previously approved activity
shall immediately cease until the board has notified the
applicant that the suspension is no longer in effect.
(d) Nontransferability of licenses.--
(1) A license issued by the board is a grant of the
privilege to conduct a business in this Commonwealth.
(2) Except as permitted by section 3517 (relating to
change in ownership or control of terminal operator
licensee), no license granted or renewed pursuant to this
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part may be sold, transferred or assigned to another person.
(3) No licensee may pledge or otherwise grant a security
interest in or lien on the license.
(4) The board has the sole discretion to issue, renew,
condition or deny the issuance of a terminal operator license
based upon the requirements of this part.
(5) Nothing contained in this part is intended or shall
be construed to create in any person an entitlement to a
license.
§ 3517. Change in ownership or control of terminal operator
licensee.
(a) Notification and approval.--
(1) A terminal operator licensee shall promptly notify
the board of a proposed or contemplated change of ownership
of the terminal operator licensee by a person or group of
persons acting in concert which involves any of the
following:
(i) More than 5% of a terminal operator licensee's
securities or other ownership interests.
(ii) More than 5% of the securities or other
ownership interests of a corporation or other form of
business entity that owns directly or indirectly at least
20% of the voting or other securities or other ownership
interests of the licensee.
(iii) The sale of all or substantially all of a
licensee's assets.
(iv) Other transaction or occurrence deemed by the
board to be relevant to license qualifications.
(2) (i) Notwithstanding the provisions of paragraph
(1), no terminal operator licensee may be required to
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notify the board of an acquisition by an institutional
investor under paragraph (1)(i) or (ii) if the
institutional investor holds less than 10% of the
securities or other ownership interests referred to in
paragraph (1)(i) or (ii), the securities or interests are
publicly traded securities and its holdings of the
securities were purchased for investment purposes only
and the institutional investor files with the board a
certified statement to the effect that it has no
intention of influencing or affecting, directly or
indirectly, the affairs of the licensee, provided,
however, that it shall be permitted to vote on matters
put to the vote of the outstanding security holders.
(ii) Notice to the board and board approval shall be
required prior to completion of any proposed or
contemplated change of ownership of a terminal operator
licensee that meets the criteria of this section.
(b) Qualification of purchaser of terminal operator
licensee; change of control.--
(1) The purchaser of all or substantially all of the
assets of a terminal operator licensee shall, if not already
a terminal operator licensee, independently qualify for a
license in accordance with this part and shall pay the
license fee as required by section 4101 (relating to fees).
(2) A change in control of a terminal operator licensee
shall require that the terminal operator licensee
independently qualify for a license in accordance with this
part, and the terminal operator licensee shall pay a new
license fee as required by section 4101, except as otherwise
required by the board pursuant to this section.
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(3) The new license fee shall be paid upon the
assignment and actual change of control or ownership of the
terminal operator license.
(c) Change in control defined.--For purposes of this
section, a change in control of a terminal operator licensee
shall mean the acquisition by a person or group of persons
acting in concert of more than 20% of a terminal operator
licensee's securities or other ownership interests, with the
exception of any ownership interest of the person that existed
at the time of initial licensing and payment of the initial slot
machine license fee, or more than 20% of the securities or other
ownership interests of a corporation or other form of business
entity that owns directly or indirectly at least 20% of the
voting or other securities or other ownership interests of the
licensee.
(d) Fee reduction.--The board may in its discretion
eliminate the need for qualification or proportionately reduce,
but not eliminate, the new license fee otherwise required
pursuant to this section in connection with a change of control
of a licensee, depending upon the type of transaction, the
relevant ownership interests and changes to the interests
resulting from the transaction and other considerations deemed
relevant by the board.
(e) License revocation.--Failure to comply with this section
may cause the license issued under this part to be revoked or
suspended by the board unless the purchase of the assets or the
change in control that meets the criteria of this section has
been independently qualified in advance by the board and any
required license fee has been paid.
§ 3518. Video gaming accounting controls and audits.
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(a) Approval.--Except as otherwise provided by this part, a
terminal operator license applicant shall, in addition to
obtaining a terminal operator license, obtain approval from the
board in consultation with the department of its internal
control systems and audit protocols prior to the installation
and operation of video gaming terminals at licensed
establishments.
(b) Minimum requirements.--At a minimum, the applicant's or
person's proposed internal controls and audit protocols shall:
(1) Safeguard its assets and revenues, including, but
not limited to, the recording of cash and evidences of
indebtedness related to the video gaming terminals.
(2) Provide for reliable records, accounts and reports
of a financial event that occurs in the operation of a video
gaming terminal, including reports to the board related to
the video gaming terminals.
(3) Ensure that each video gaming terminal directly
provides or communicates all required activities and
financial details to the central control computer system as
set by the board.
(4) Provide for accurate and reliable financial records.
(5) Ensure a financial event that occurs in the
operation of a video gaming terminal is performed only in
accordance with the management's general or specific
authorization, as approved by the board.
(6) Ensure that a financial event that occurs in the
operation of a video gaming terminal is recorded adequately
to permit proper and timely reporting of gross revenue and
the calculation thereof and of fees and taxes and to maintain
accountability for assets.
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(7) Ensure that access to assets is permitted only in
accordance with management's specific authorization, as
approved by the board.
(8) Ensure that recorded accountability for assets is
compared with actual assets at reasonable intervals and
appropriate action is taken with respect to discrepancies.
(9) Ensure that all functions, duties and
responsibilities are appropriately segregated and performed
in accordance with sound financial practices by competent,
qualified personnel.
(c) Internal control.--A terminal operator license applicant
shall submit to the board and department, in such manner as the
board requires, a description of its administrative and
accounting procedures in detail, including its written system of
internal control. The written system of internal control shall
include:
(1) Records of direct and indirect ownership in the
proposed terminal operator licensee, its affiliate,
intermediary, subsidiary or holding company.
(2) An organizational chart depicting appropriate
segregation of functions and responsibilities.
(3) A description of the duties and responsibilities of
each position shown on the organizational chart.
(4) A detailed narrative description of the
administrative and accounting procedures designed to satisfy
the requirements of this section.
(5) Record retention policy.
(6) Procedure to ensure that assets are safeguarded,
including mandatory count procedures.
(7) A statement signed by the chief financial officer of
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the terminal operator license applicant or other competent
person and the chief executive officer of the terminal
operator license applicant or other competent person
attesting that the officer believes, in good faith, that the
system satisfies the requirements of this section.
(8) Other items that the board may require in its
discretion.
§ 3519. Multiple licenses prohibited.
(a) Manufacturer restriction.--A manufacturer may not be
licensed as a terminal operator or own, manage or control an
establishment licensee, but may also be licensed as a supplier.
(b) Supplier restriction.--A supplier may not be licensed as
a terminal operator or own, manage or control an establishment
licensee or terminal operator licensee.
(c) Terminal operator restriction.--A terminal operator may
not be licensed as a manufacturer or supplier or own, manage or
control an establishment licensee or own, manage or control
premises used by an establishment licensee.
(d) Establishment restriction.--An establishment licensee
may not be licensed as a manufacturer, supplier, terminal
operator or procurement agent.
(e) Exception.--Notwithstanding subsections (c) and (d), a
terminal operator that is also a licensed racing entity may be
issued an establishment license for an establishment that is
also a nonprimary location.
§ 3520. Conditional licenses.
(a) Findings.--The General Assembly finds that:
(1) Prompt and expedited implementation of video gaming
in this Commonwealth is desirable, to the extent that such
expedited implementation can be accomplished without
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compromising the integrity of gaming.
(2) The conditional licensing provisions of this section
strike the correct balance between assuring that licensees
meet the licensing criteria without causing an undue delay in
implementation of this part.
(b) Conditional establishment licenses.--
(1) Within 60 days after the effective date of this
section, the board shall make applications for establishment
licenses available to applicants.
(2) The board shall issue a conditional license to an
applicant for an establishment license if the applicant
satisfies, as determined by the board, all of the following
criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
application for an establishment license in accordance
with this part, which may be submitted concurrently with
the applicant's request for a conditional license.
(iv) For liquor establishment applicants, the
applicant held a valid liquor license under Article IV of
the act of April 12, 1951 (P.L.90, No.21), known as the
Liquor Code, on the date of application and such license
is in good standing.
(v) The applicant has never been convicted of a
gambling law violation in any jurisdiction.
(3) (i) The board shall issue a conditional license to
an applicant for an establishment license, within 60 days
after the application has been received by the board,
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provided that the board determines that the criteria
contained in paragraph (2) has been satisfied.
(ii) If the board determines that the criteria
contained in paragraph (2) has not been satisfied, the
board shall give a written explanation to the applicant
as to why it has determined the criteria has not been
satisfied.
(4) A conditional license shall be valid until:
(i) the board either approves or denies the
applicant's application for licensure;
(ii) the conditional license is terminated for a
violation of this part; or
(iii) one calendar year has passed since the
conditional license was issued.
(5) If the board fails to act upon the application for a
licensed establishment within 60 days after the expiration of
a conditional license, the applicant may apply for a renewal
of the conditional license.
(6) An applicant shall attest by way of affidavit under
penalty of perjury that the applicant is not otherwise
prohibited from licensure according to the requirements of
this section or any other provision of this part.
(7) A request for conditional licensure under this
subsection shall include payment of a $100 fee, which fee
shall be in addition to the applicable fee required under
section 4101 (relating to fees).
(c) Conditional terminal operator licenses.--
(1) Within 60 days after the effective date of this
section, the board shall make applications for terminal
operator licenses available to applicants.
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(2) The board shall accept applications for conditional
terminal operator licenses beginning 14 days after
applications become available.
(3) The board shall issue a conditional license to an
applicant for a terminal operator license if the applicant
satisfies, as determined by the board, all of the following
criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
application for a terminal operator license which may be
submitted concurrently with the applicant's request for a
conditional license.
(iv) The applicant has never had its terminal
operator license or similar gaming license denied or
revoked in another jurisdiction.
(v) The applicant has never been convicted of a
gambling law violation in any jurisdiction.
(4) (i) The board shall issue a conditional license to
an applicant for a terminal operator license, within 60
days after the application has been received by the
board, provided that the board determines that the
criteria contained in paragraph (3) has been satisfied.
(ii) If the board determines that the criteria
contained in paragraph (3) has not been satisfied, the
board shall give a written explanation to the applicant
as to why it has determined the criteria has not been
satisfied.
(5) A conditional license shall be valid until:
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(i) the board either approves or denies the
applicant's application for licensure;
(ii) the conditional license is terminated for a
violation of this chapter; or
(iii) one calendar year has passed since the
conditional license was issued.
(6) If the board fails to act upon the application,
within 60 days after the expiration of a conditional license,
the applicant may apply for a renewal of the conditional
license.
(7) An applicant shall attest by way of affidavit under
penalty of perjury that the applicant is not otherwise
prohibited from licensure according to the requirements of
this subsection or any other provision of this part.
(8) A request for conditional licensure under this
subsection shall include payment of a $5,000 fee, which fee
shall be in addition to the applicable fee required under
section 4101.
(d) Conditional manufacturer and supplier licenses.--
(1) Within 60 days after the effective date of this
section, the board shall make applications available for
manufacturer and supplier license.
(2) The board shall issue a conditional license to an
applicant for a manufacturer or supplier license if the
applicant satisfies, as determined by the board, all of the
following criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
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application a manufacturer or supplier license, which may
be submitted concurrently with the applicant's request
for a conditional license.
(iv) The applicant has never had its manufacturer,
supplier or similar gaming license denied or revoked in
another jurisdiction.
(v) The applicant has never been convicted of a
gambling law violation in any jurisdiction.
(3) (i) The board shall issue a conditional license to
an applicant for a manufacturer or supplier license
within 60 days after such application has been received
by the board, provided that the board determines that the
criteria contained in paragraph (2) has been satisfied.
(ii) If the board determines that the criteria
contained in paragraph (2) has not been satisfied, the
board shall give a written explanation to the applicant
as to why it has determined the criteria has not been
satisfied.
(4) A conditional license shall be valid until:
(i) the board either approves or denies the
applicant's application for licensure;
(ii) the conditional license is terminated for a
violation of this part; or
(iii) one calendar year has passed since the
conditional license was issued.
(5) If the board fails to act upon the application for a
manufacturer or supplier license, within 60 days after the
expiration of a conditional license, the applicant may apply
for a renewal of the conditional license.
(6) An applicant shall attest by way of affidavit under
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penalty of perjury that the applicant is not otherwise
prohibited from licensure according to the requirements of
this subsection or any other provision of this part.
(7) A request for a conditional license under this
subsection shall include payment of a $1,000 fee, which fee
shall be in addition to the applicable fee required under
section 4101.
(e) Other conditional licenses.--
(1) Within 60 days after the effective date of this
section, the board shall make applications available for any
other license required under this part.
(2) The board shall issue a conditional license to an
applicant if the applicant satisfies, as determined by the
board, all of the following criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
application for licensure, which may be submitted
concurrently with the applicant's request for a
conditional license.
(iv) The applicant has never been convicted of a
gambling law violation in any jurisdiction.
(3) (i) The board shall issue a conditional license to
an applicant within 60 days after the application has
been received by the board, provided that the board
determines that the criteria contained in paragraph (2)
has been satisfied.
(ii) If the board determines that the criteria
contained in paragraph (2) has not been satisfied, the
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board shall give a written explanation to the applicant
as to why it has determined the criteria has not been
satisfied.
(4) A conditional license shall be valid until:
(i) the board either approves or denies the
applicant's application for licensure;
(ii) the conditional license is terminated for a
violation of this part; or
(iii) one calendar year has passed since the
conditional license was issued.
(5) If the board fails to act upon the application for
licensure within 60 days after the expiration of a
conditional license, the applicant may apply for a renewal of
the conditional license.
(6) An applicant shall attest by way of affidavit under
penalty of perjury that the applicant is not otherwise
prohibited from licensure according to the requirements of
this subsection or any other provision of this part.
(7) A request for conditional licensure under this
subsection shall include payment of a $100 fee, which fee
shall be in addition to the applicable fee required under
section 4101.
(f) Prioritization prohibited.--
(1) The board may not utilize the alternative licensing
standards for a terminal operator license, manufacturer
license or a supplier license under sections 3511 (relating
to alternative terminal operator licensing standards), 3512
(relating to alternative manufacturer licensing standards)
and 3513 (relating to alternative supplier licensing
standards) to prioritize the issuance of a terminal operator,
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manufacturer or supplier license under this chapter.
(2) The board shall ensure that applications made to the
board according to the alternative standards under sections
3511, 3512 and 3513 are not approved or denied in a time
period that is less than the time period in which an
application for a conditional license is approved or denied
under this section.
CHAPTER 37
OPERATION
3701. Testing and certification of terminals.
3702. Video gaming limitations.
3703. Hours of operation.
3704. Terminal placement agreements.
3705. Duties of licensees.
3706. Compulsive and problem gambling.
§ 3701. Testing and certification of terminals.
(a) General rule.--No video gaming terminal or redemption
terminal may be made available for use in this Commonwealth
prior to that model of video gaming terminal or redemption
terminal being tested and certified by the board in accordance
with this section.
(b) Video gaming terminal specifications.--Video gaming
terminal models shall be tested and certified to meet the
following specifications:
(1) The video gaming terminal shall have the ability to
be linked to the central control computer.
(2) The video gaming terminal shall be marked with an
irremovable identification plate that is placed in a
conspicuous location on the exterior of the video gaming
terminal. The identification plate shall contain the name of
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the manufacturer and the serial and model numbers of the
video gaming terminal.
(3) The video gaming terminal shall prominently display
the rules of play either on the video gaming terminal face or
screen.
(4) The video gaming terminal may not have the ability
to dispense cash, tokens or anything of value, except
redemption tickets which shall only be exchangeable for cash
at a redemption terminal or reinserted into another video
gaming terminal located in the same video gaming area as the
video gaming terminal.
(5) The cost of a credit shall only be 1 ¢ , 5 ¢ , 10 ¢ or
25 ¢ .
(6) The maximum wager per individual game shall not
exceed $5.
(7) The maximum prize per individual game shall not
exceed $1,000.
(8) The video gaming terminal shall be designed and
manufactured with total accountability to include gross
proceeds, net profits, winning percentages and other
information the board requires.
(9) The video gaming terminal shall pay out a minimum of
85% of the amount wagered.
(10) Other specifications the board requires.
(c) Redemption terminal specifications.--Redemption terminal
models shall be tested and certified to meet the following
specifications:
(1) The redemption terminal shall be marked with an
irremovable identification plate that is placed in a
conspicuous location on the exterior of the redemption
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terminal. The identification plate shall contain the name of
the manufacturer and the serial and model numbers of the
redemption terminal.
(2) The redemption terminal shall only accept redemption
tickets from video gaming terminals located in the same video
gaming area.
(3) The redemption terminal shall be designed and
manufactured with total accountability to record information
the board requires.
(4) Other specifications the board requires.
(d) Use of other state standards.--
(1) The board may determine, in its discretion, whether
the video gaming terminal or redemption terminal testing and
certification standards of another jurisdiction within the
United States in which a manufacturer licensee is licensed
are comprehensive and thorough and provide similar adequate
safeguards as those required by this part.
(2) If the board makes that determination, the board may
permit a manufacturer licensee through a licensed supplier to
deploy those video gaming terminals or redemption terminals
which have met the video gaming terminal or redemption
terminal testing and certification standards in such other
jurisdictions without undergoing the full testing and
certification process by the board's testing facility.
(3) In the event video gaming terminals or redemption
terminals of a manufacturer licensee are licensed in the
other jurisdiction, the board may determine to use an
abbreviated process requiring only that information
determined by the board to be necessary to consider the
issuance of a video gaming terminal or redemption terminal
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certification to such an applicant.
(e) Private testing.--The board may, in its discretion, rely
upon the certification of a video gaming terminal or redemption
terminal that has met the testing and certification standards of
one or more board-approved independent private testing and
certification facilities.
(f) Testing and certification fee.--
(1) A fee for the testing and certification of a video
gaming terminal or redemption terminal shall be paid by the
manufacturer licensee submitting the terminal, which fee
shall be an amount established by the board according to a
schedule adopted by the board.
(2) Fees established by the board shall be exempt from
any fee limitation contained in section 4101 (relating to
fees).
(g) Central control computer compatibility.--The board shall
ensure that all video gaming terminals certified and approved
for use in this Commonwealth are compatible and comply with the
central control computer and protocol specifications approved by
the department.
§ 3702. Video gaming limitations.
(a) Establishment licensee limitations.--An establishment
licensee may offer video gaming terminals for play within its
premises, subject to the following:
(1) No more than the following number of video gaming
terminals may be placed on the premises of the establishment
licensee:
(i) For an establishment licensee that is a truck
stop establishment, no more than 10 video gaming
terminals.
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(ii) For an establishment licensee that is a
nonprimary location, no more than 10 video gaming
terminals.
(iii) For an establishment licensee that is not a
truck stop establishment or nonprimary location, no more
than five video gaming terminals.
(2) Redemption tickets shall only be exchanged for cash
through a redemption terminal or reinserted into another
video gaming terminal in the same video gaming area or as
otherwise authorized by the board in the event of a failure
or malfunction in a redemption terminal, and at least one
redemption terminal shall be located in the video gaming
area.
(3) Video gaming terminals located on the premises of
the establishment licensee shall be placed and operated by a
terminal operator licensee pursuant to a terminal placement
agreement.
(4) No video gaming area may be located in an area that
is not properly segregated from minors.
(5) The entrance to the video gaming area shall be
secure and easily seen and observed by at least one employee.
(6) The video gaming area shall at all times be
monitored by an employee of the establishment licensee either
directly or through live monitoring of video surveillance.
The employee must be at least 18 years of age and have
completed the mandatory training program required in section
3706 (relating to compulsive and problem gambling).
(7) No establishment licensee may generally advertise
video gaming terminals to the general public, unless
otherwise authorized by the board.
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(8) No establishment licensee may provide an incentive,
unless otherwise authorized by the board.
(9) No minor shall be permitted to play a video gaming
terminal or enter the video gaming area.
(10) No visibly intoxicated person shall be permitted to
play a video gaming terminal.
(11) No establishment licensee may extend credit or
accept a credit card or debit card for play of a video gaming
terminal.
(12) No establishment licensee may make structural
alterations or significant renovations to a video gaming area
unless the establishment licensee has notified the terminal
operator licensee and obtained prior approval from the board.
(13) No establishment licensee may move a video gaming
terminal or redemption terminal after installation by a
terminal operator licensee.
(b) Terminal operator licensee limitations.--A terminal
operator licensee may place and operate video gaming terminals
on the premises of an establishment licensee, subject to the
following:
(1) No more than the following number of video gaming
terminals may be placed on the premises of the establishment
licensee:
(i) For an establishment licensee that is a truck
stop establishment, no more than 10 video gaming
terminals.
(ii) For an establishment licensee that is a
nonprimary location, no more than 10 video gaming
terminals.
(iii) For an establishment licensee that is not a
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truck stop establishment or nonprimary location, no more
than five video gaming terminals.
(2) Redemption tickets shall only be exchanged for cash
through a redemption terminal located within the same video
gaming area or reinserted into another video gaming terminal
located in the same video gaming area as the video gaming
terminal.
(3) Video gaming terminals located on the premises of
the establishment licensee shall be placed and operated
pursuant to a terminal placement agreement.
(4) No terminal operator licensee may generally
advertise video gaming terminals to the general public,
unless otherwise authorized by the board, but may advertise
to a person enrolled in the terminal operator licensee's
customer loyalty or rewards card program.
(5) No terminal operator licensee may provide an
incentive.
(6) No terminal operator licensee may place and operate
video gaming terminals within a licensed facility.
(7) No terminal operator licensee may extend credit or
accept a credit card or debit card for play of a video gaming
terminal.
(8) No terminal operator licensee may give or offer to
give, directly or indirectly, any type of inducement to an
establishment to secure or maintain a terminal placement
agreement.
(9) No terminal operator licensee may give an
establishment licensee a percentage of gross terminal revenue
that is more than 25% of the gross terminal revenue of the
video gaming terminals operating in the establishment
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licensee's premises.
(10) A terminal operator licensee shall only operate,
install or otherwise make available for public use a video
gaming terminal or redemption terminal that has been obtained
from a supplier licensee.
(11) No terminal operator licensee may make structural
alterations or significant renovations to a video gaming area
unless the terminal operator licensee has notified the
establishment licensee and obtained prior approval from the
board.
(12) No terminal operator licensee may move a video
gaming terminal or redemption terminal after installation
unless prior approval is obtained from the board.
(13) Only a terminal operator licensee that is also a
licensed racing entity may operate a video gaming terminal at
a nonprimary location.
§ 3703. Hours of operation.
(a) Liquor establishments.--An establishment licensee that
is also a liquor establishment may only permit the play of video
gaming terminals during the hours in which the liquor
establishment is authorized by the Pennsylvania Liquor Control
Board to sell alcoholic beverages.
(b) Other establishments.--An establishment licensee that is
also a nonprimary location or a truck stop establishment may
permit play of video gaming terminals during normal business
hours.
§ 3704. Terminal placement agreements.
(a) Intent.--It is the intent and goal of the General
Assembly that the board shall have exclusive jurisdiction to
determine the enforceability and validity of a terminal
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placement agreement as is necessary and appropriate to protect
the integrity of the industry.
(b) General rule.--Except as provided for in subsection (j),
no terminal operator licensee may place and operate video gaming
terminals on the premises of an establishment licensee unless
pursuant to a terminal placement agreement approved by the
board. Approval shall be presented upon connection of one or
more video gaming terminals at the establishment licensee to the
central control computer.
(c) Form of agreement.--The board shall establish through
regulation minimum standards for terminal placement agreements.
(d) Length of agreement.--Terminal placement agreements
shall be valid for a minimum 60-month term but shall not exceed
a 120-month term.
(e) Provisions required.--A terminal placement agreement
shall include a provision that:
(1) Renders the agreement invalid if either the terminal
operator license or terminal operator application or the
establishment license or establishment licensee application
is denied, revoked, not renewed, withdrawn or surrendered.
(2) Provides the establishment licensee no more than 25%
of gross terminal revenue from each video gaming terminal
located on the premises of the establishment licensee.
(3) Identifies who solicited the terminal placement
agreement on behalf of a terminal operator licensee or
applicant.
(f) Procurement agent.--No person may be compensated for the
solicitation or procurement of a terminal placement agreement on
behalf of a terminal operator licensee or applicant until the
person is licensed as a procurement agent under section 3505.1
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(relating to procurement agent licenses) or is otherwise
authorized under this part.
(g) Parties to agreement.--Only an establishment licensee or
applicant may sign or agree to sign a terminal placement
agreement with an applicant for a terminal operator license or a
terminal operator licensee.
(h) Void agreements.--An agreement entered into by an
establishment prior to the effective date of this section with a
person or entity for the placement, operation, service or
maintenance of video gaming terminals, including an agreement
granting a person or entity the right to enter into an agreement
or match any offer made after the effective date of this section
shall be void and may not be approved by the board.
(i) Transferability of agreements.--No terminal placement
agreement may be transferred or assigned unless the individual
or entity making the assignment is either a terminal operator
applicant or licensee and the individual or entity receiving the
assignment of the terminal placement agreement is either a
terminal operator applicant or licensee under this chapter.
(j) Exception.--A terminal placement agreement may not
require operation of video gaming terminals on the premises of a
nonprimary location.
§ 3705. Duties of licensees.
A person issued a license under this part shall:
(1) Provide assistance or information required by the
board or the Pennsylvania State Police and to cooperate in
inquiries, investigations and hearings.
(2) Consent to inspections, searches and seizures.
(3) Inform the board of actions that the person believes
would constitute a violation of this part.
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(4) Inform the board of arrests for violations of
offenses enumerated under 18 Pa.C.S. (relating to crimes and
offenses).
§ 3706. Compulsive and problem gambling.
(a) Required posting.--
(1) An establishment licensee shall conspicuously post
signs similar to the following statement:
If you or someone you know has a gambling problem,
help is available. Call (Toll-free telephone number)
or Text (Toll-free telephone number).
(2) At least one sign shall be posted within the video
gaming area and at least one sign shall be posted within five
feet of each automated teller machine located within the
establishment licensee's premises, if applicable.
(b) Toll-free telephone number.--The toll-free telephone
number required to be posted in subsection (a) shall be the same
number maintained by the Department of Drug and Alcohol Programs
under section 3310 (relating to Department of Drug and Alcohol
Programs).
(c) Problem gambling information.--
(1) An establishment licensee shall have available in
its establishment access to materials regarding compulsive
and problem gambling assistance.
(2) The available materials required by paragraph (1)
shall be a uniform, Statewide handout developed by the board
in consultation with the Department of Drug and Alcohol
Programs.
(3) The available materials required by paragraph (1)
shall be displayed conspicuously at least within the video
gaming area.
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(d) Mandatory training.--
(1) The board's Office of Compulsive and Problem
Gambling, in consultation with the Department of Drug and
Alcohol Programs, shall develop a mandatory training program
for employees and management of an establishment licensee who
oversee the licensee's video gaming area. The training
program shall address responsible gaming and other compulsive
and problem gambling issues related to video gaming
terminals.
(2) The board shall establish a fee to cover the cost of
the mandatory training program.
(3) At least one employee of the establishment licensee
who has successfully completed the training program shall be
located on the premises and supervising the video gaming area
during all times video gaming terminals are available for
play.
(e) Penalty.--An establishment licensee that fails to
fulfill the requirements of subsection (a), (b) or (c) shall be
assessed by the board an administrative penalty and may have its
establishment license suspended. When determining the penalty
and number of suspension days, the board shall consider the
length of time in which the materials were not available or a
trained employee was not located on the premises as required by
subsection (d)(3).
CHAPTER 39
ENFORCEMENT
Sec.
3901. Exclusion or ejection of certain persons.
3902. Repeat offenders.
3903. Self-exclusion.
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3904. Investigations and enforcement.
3905. Prohibited acts and penalties.
3906. Report of suspicious transactions.
3907. Additional authority.
3908. Detention.
§ 3901. Exclusion or ejection of certain persons.
(a) General rule.--The board shall by regulation provide for
the establishment of a list of persons who are to be excluded or
ejected from the video gaming area of an establishment licensee.
The provisions shall define the standards for exclusion and
shall include standards relating to persons who are career or
professional offenders as defined by regulations of the board or
whose presence in a video gaming area would, in the opinion of
the board, be inimical to the interest of the Commonwealth or of
licensed video gaming in this Commonwealth, or both.
(b) Categories to be defined.--The board shall promulgate
definitions establishing categories of persons who shall be
excluded or ejected pursuant to this section, including cheats
and persons whose privileges for licensure, certification,
permit or registration have been revoked.
(c) Discrimination prohibited.--Race, color, creed, national
origin or ancestry or sex shall not be a reason for placing the
name of a person upon a list under this section.
(d) Prevention of access.--The board shall, in consultation
with terminal operator licensees and establishment licensees,
develop policies and procedures to reasonably prevent persons on
the list required by this section from entering a video gaming
area.
(e) Sanctions.--The board may impose sanctions upon an
establishment licensee in accordance with this part if the
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establishment licensee knowingly fails to implement the policies
and procedures established by the board under paragraph (d).
(f) List not all-inclusive.--A list compiled by the board
under this section shall not be deemed an all-inclusive list,
and an establishment licensee shall keep from the video gaming
area persons known to the establishment licensee to be within
the classifications declared in this section and the regulations
promulgated under this section whose presence in a video gaming
area would be inimical to the interest of the Commonwealth or of
licensed video gaming in this Commonwealth, or both, as defined
in standards established by the board.
(g) Notice.--If the bureau decides to place the name of a
person on a list pursuant to this section, the bureau shall
serve notice of the decision to the person by personal service
or certified mail at the last known address of the person. The
notice shall inform the person of the right to request a hearing
under subsection (h).
(h) Hearing.--
(1) Within 30 days after receipt of notice in accordance
with subsection (g), the person named for exclusion or
ejection may demand a hearing before the board, at which
hearing the bureau must demonstrate that the person named for
exclusion or ejection satisfies the criteria for exclusion or
ejection established by this section and the board's
regulations.
(2) Failure of the person to demand a hearing within 30
days after service shall be deemed an admission of all
matters and facts alleged in the bureau's notice and shall
preclude the person from having an administrative hearing,
but shall in no way affect the right to judicial review as
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provided in this section.
(i) Review.--
(1) If, upon completion of a hearing on the notice of
exclusion or ejection, the board determines that placement of
the name of the person on the exclusion or ejection list is
appropriate, the board shall make and enter an order to that
effect, which order shall be served on all licensed gaming
entities.
(2) The order shall be subject to review by the
Commonwealth Court in accordance with the rules of court.
§ 3902. Repeat offenders.
(a) Discretion to exclude or eject.--An establishment
licensee may exclude or eject from the establishment licensee's
video gaming area or premises a person who is known to it to
have been convicted of a misdemeanor or felony committed in or
on the premises of a licensed establishment.
(b) Construction.--Nothing in this section or in any other
law of this Commonwealth shall be construed to limit the right
of an establishment licensee to exercise its common law right to
exclude or eject permanently from its video gaming area or
premises a person who:
(1) disrupts the operations of its premises;
(2) threatens the security of its premises or its
occupants; or
(3) is disorderly or intoxicated.
§ 3903. Self-exclusion.
(a) Establishment of list.--
(1) The board shall provide by regulation for the
establishment of a list of persons self-excluded from video
gaming activities within specific establishment licensees or
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establishment licensees in geographic areas of the
Commonwealth.
(2) A person may request placement on the list of self-
excluded persons by:
(i) acknowledging in a manner to be established by
the board that the person is a problem gambler; and
(ii) agreeing that, during any period of voluntary
exclusion, the person may not collect any winnings or
recover any losses resulting from any video gaming
activity within establishment licensees.
(b) Regulations.--The regulations of the board shall
establish:
(1) Procedures for placement on and removal from the
list of a self-excluded person.
(2) Procedures for the transmittal to establishment
licensees of identifying information concerning a self-
excluded person and shall require establishment licensees to
establish reasonable procedures designed at a minimum to
prevent entry of a self-excluded person into the video gaming
area of an establishment licensee, provided that the board
may not require video gaming terminals to be equipped with
identification card-reading devices or require establishment
licensees to purchase identification card-reading devices.
(3) Procedures for the transmittal to terminal operator
licensees of identifying information concerning a self-
excluded person and shall require terminal operator licensees
to establish procedures to remove self-excluded persons from
customer loyalty or reward card programs and all advertising
related to these programs; provided that the board may not
require video gaming terminals to be equipped with
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identification card-reading devices or require establishment
licensees to purchase identification card-reading devices.
(c) Liability.--An establishment licensee or employee
thereof shall not be liable to a self-excluded person or to
another party in a judicial proceeding for harm, monetary or
otherwise, which may arise as a result of:
(1) the failure of the establishment licensee to
withhold video gaming privileges from or restore video gaming
privileges to the self-excluded person; or
(2) otherwise permitting or not permitting the self-
excluded person to engage in video gaming activity within the
establishment licensee's premises while on the list of self-
excluded persons.
(d) Nondisclosure.--Notwithstanding any other law to the
contrary, the board's list of self-excluded persons shall not be
open to public inspection.
§ 3904. Investigations and enforcement.
(a) Powers and duties of bureau.--The bureau shall have the
following powers and duties:
(1) Enforce the provisions of this part.
(2) Investigate and review applicants and applications
for a license or registration. The bureau shall be prohibited
from disclosing any portion of a background investigation
report to a member of the board prior to the submission of
the bureau's final background investigation report relating
to the applicant's suitability for licensure to the board.
The Office of Enforcement Counsel, on behalf of the bureau,
shall prepare the final background investigation report for
inclusion in a final report relating to the applicant's
suitability for licensure.
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(3) Investigate licensees, registrants and other persons
regulated by the board under this part for noncriminal
violations of this part, including potential violations
referred to the bureau by the board or other person.
(4) Monitor video gaming operations to ensure compliance
with this part.
(5) Inspect and examine licensed entities. Inspections
may include the review and reproduction of documents or
records.
(6) Conduct reviews of a licensed entity as necessary to
ensure compliance with this part. A review may include the
review of accounting, administrative and financial records,
management control systems, procedures and other records
utilized by a licensed entity.
(7) Refer possible criminal violations to the
Pennsylvania State Police. The bureau shall not have the
power of arrest.
(8) Cooperate in the investigation and prosecution of
criminal violations related to this part.
(9) Be a criminal justice agency under 18 Pa.C.S. Ch. 91
(relating to criminal history record information).
(b) Office of Enforcement Counsel.--The board's Office of
Enforcement Counsel shall act as the prosecutor in all
noncriminal enforcement actions initiated by the bureau under
this part and shall have the following powers and duties:
(1) Advise the bureau on all matters, including the
granting of licenses or registrations, the conduct of
background investigations, audits and inspections and the
investigation of potential violations of this part.
(2) File on behalf of the bureau recommendations and
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objections relating to the issuance of licenses and
registrations.
(3) Initiate, in its sole discretion, proceedings for
noncriminal violations of this part by filing a complaint or
other pleading with the board.
(c) Powers and duties of department.--
(1) The department shall at all times have the power of
access to examine and audit equipment and records relating to
all aspects of the operation of video gaming terminals and
redemption terminals under this part.
(2) Notwithstanding the provisions of section 353(f) of
the act of March 4, 1971 (P.L.6, No.2), known as the Tax
Reform Code of 1971, the department shall supply the board,
the bureau, the Pennsylvania State Police and the Office of
Attorney General with information concerning the status of
delinquent taxes owned by applicants or licensees.
(d) Powers and duties of the Pennsylvania State Police.--The
Pennsylvania State Police shall have the following powers and
duties:
(1) Promptly conduct background investigations on
persons as directed by the board under this part. The
Pennsylvania State Police may contract with other law
enforcement annuitants to assist in the conduct of
investigations under this paragraph.
(2) Initiate proceedings for criminal violations of this
part.
(3) Provide the board with all information necessary for
all actions under this part for all proceedings involving
criminal enforcement of this part.
(4) Inspect, when appropriate, a licensee's person and
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personal effects present within an establishment licensee's
premises under this part while that licensee is present.
(5) Enforce the criminal provisions of this part and all
other criminal laws of this Commonwealth.
(6) Fingerprint applicants for licenses.
(7) Exchange fingerprint data with and receive national
criminal history record information from the Federal Bureau
of Investigation for use in investigating applications for
any license under this part.
(8) Receive and take appropriate action on any referral
from the board relating to criminal conduct.
(9) Require the production of information, material and
other data from a licensee or other applicant seeking
approval from the board.
(10) Conduct administrative inspections on the premises
of an establishment licensee at such times, under such
circumstances and to such extent as the bureau determines to
ensure compliance with this part and the regulations of the
board and, in the course of inspections, review and make
copies of all documents and records required by the
inspection through onsite observation and other reasonable
means to assure compliance with this part and regulations
promulgated under this part.
(11) Conduct audits or verification of information of
video gaming terminal operations at such times, under such
circumstances and to such extent as the bureau determines.
This paragraph includes the review of accounting,
administrative and financial records and management control
systems, procedures and records utilized by a terminal
operator licensee.
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(12) Assign members of the Pennsylvania State Police to
duties of enforcement under this part. Those members shall
not be counted toward the complement as provided in section
205 of the act of April 9, 1929 (P.L.177, No.175), known as
The Administrative Code of 1929.
(13) Report to the General Assembly. By March 1 of each
year, the Commissioner of the Pennsylvania State Police shall
submit a report to the Appropriations Committee of the
Senate, the Community, Economic and Recreational Development
Committee of the Senate, the Appropriations Committee of the
House of Representatives and the Gaming Oversight Committee
of the House of Representatives. The report shall summarize
all law enforcement activities at each establishment licensee
during the previous calendar year and shall include all of
the following:
(i) The number of arrests made and citations issued
at each establishment licensee and the name of the law
enforcement agency making the arrests or issuing the
citations.
(ii) A list of specific offenses charged for each
arrest made or citation issued.
(iii) The number of criminal prosecutions resulting
from arrests made or citations issued.
(iv) The number of convictions resulting from
prosecutions reported under subparagraph (iii).
(14) Report violations of this part to the bureau that
are found during the normal course of duties required under
any law of this Commonwealth.
(15) Require the Bureau of Liquor Control Enforcement to
report violations of this part to the bureau that are found
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during the normal course of duties required under any law of
this Commonwealth.
(e) Powers and duties of Attorney General.--The Gaming Unit
within the Office of Attorney General shall investigate and
institute criminal proceedings as authorized under subsection
(f).
(f) Criminal action.--
(1) The district attorneys of the several counties shall
have authority to investigate and to institute criminal
proceedings for a violation of this part.
(2) In addition to the authority conferred upon the
Attorney General under the act of October 15, 1980 (P.L.950,
No.164), known as the Commonwealth Attorneys Act, the
Attorney General shall have the authority to investigate and,
following consultation with the appropriate district
attorney, to institute criminal proceedings for a violation
of this part.
(3) A person charged with a violation of this part by
the Attorney General shall not have standing to challenge the
authority of the Attorney General to investigate or prosecute
the case, and, if any such challenge is made, the challenge
shall be dismissed and no relief shall be available in the
courts of this Commonwealth to the person making the
challenge.
(g) Regulatory action.--Nothing contained in subsection (e)
shall be construed to limit the existing regulatory or
investigative authority of an agency or the Commonwealth whose
functions relate to persons or matters within the scope of this
part.
(h) Inspection, seizure and warrants.--
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(1) The bureau, the department and the Pennsylvania
State Police shall have the authority without notice and
without warrant to do all of the following in the performance
of their duties under this part:
(i) Inspect and examine all premises where video
gaming operations are conducted; where video gaming
terminals, redemption terminals and associated equipment
are manufactured, sold, distributed or serviced; or where
records of these activities are prepared or maintained.
(ii) Inspect all equipment and supplies in, about,
upon or around premises referred to in subparagraph (i).
(iii) Seize, summarily remove and impound equipment
and supplies from premises referred to in subparagraph
(i) for the purposes of examination and inspection.
(iv) Inspect, examine and audit all books, records
and documents pertaining to a terminal operator
licensee's video gaming operation.
(v) Seize, impound or assume physical control of any
book, record, ledger or device related to video gaming
operations or the video gaming terminals or redemption
terminals.
(2) The provisions of paragraph (1) shall not be
construed to limit warrantless inspections except in
accordance with constitutional requirements.
(3) To further effectuate the purposes of this part, the
bureau and the Pennsylvania State Police may obtain
administrative warrants for the inspection and seizure of
property possessed, controlled, bailed or otherwise held by
an applicant, licensee, intermediary, subsidiary, affiliate
or holding company.
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(i) Information sharing and enforcement referral.--With
respect to the administration, supervision and enforcement of
this part, the bureau, the department, the Pennsylvania State
Police or the Office of Attorney General may obtain or provide
pertinent information regarding applicants or licensees from or
to law enforcement entities or gaming authorities of the
Commonwealth and other domestic, foreign or federally approved
jurisdictions, including the Federal Bureau of Investigation,
and may transmit the information to each other electronically.
(j) Liquor control board.--Nothing in this part shall be
construed as conferring on the Pennsylvania Liquor Control Board
the authority to assess penalties under the act of April 12,
1951 (P.L.90, No.21), known as the Liquor Code, against a liquor
establishment that holds an establishment license for violations
of this part that are not a criminal offense.
(k) Information sharing and enforcement referral.--With
respect to the administration, supervision and enforcement of
this part, the bureau, the department, the Pennsylvania State
Police or the Office of Attorney General may obtain or provide
pertinent information regarding applicants or licensees from or
to law enforcement entities or gaming authorities of the
Commonwealth and other domestic, foreign or federally approved
jurisdictions, including the Federal Bureau of Investigation,
and may transmit such information to each other electronically.
§ 3905. Prohibited acts and penalties.
(a) Criminal offenses.--
(1) The provisions of 18 Pa.C.S. § 4902 (relating to
perjury), 4903 (relating to false swearing) or 4904 (relating
to unsworn falsification to authorities) shall apply to a
person providing information or making a statement, whether
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written or oral, to the board, the bureau, the department,
the Pennsylvania State Police or the Office of Attorney
General, as required by this part.
(2) It shall be unlawful for a person to willfully:
(i) fail to report, pay or truthfully account for
and pay over a license fee, authorization fee, tax or
assessment imposed under this part; or
(ii) attempt in any manner to evade or defeat a
license fee, authorization fee, tax or assessment imposed
under this part.
(3) It shall be unlawful for a licensed entity, gaming
employee, key employee or any other person to permit a video
gaming terminal to be operated, transported, repaired or
opened on the premises of an establishment licensee by a
person other than a person licensed or permitted by the board
pursuant to this part.
(4) It shall be unlawful for a licensed entity or other
person to manufacture, supply or place video gaming
terminals, redemption terminals or associated equipment into
play or display video gaming terminals, redemption terminals
or associated equipment on the premises of an establishment
licensee without the authority of the board.
(5) It shall be unlawful for a licensed entity or other
person to manufacture, supply, operate, carry on or expose
for play a video gaming terminal or associated equipment
after the person's license has expired or failed to be
renewed in accordance with this part.
(6) It shall be unlawful for an individual while on the
premises of an establishment licensee to knowingly use
currency other than lawful coin or legal tender of the United
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States or a coin not of the same denomination as the coin
intended to be used in the video gaming terminal or use a
counterfeit or altered redemption tickets with the intent to
cheat or defraud a terminal operator licensee or the
Commonwealth or damage the video gaming terminal or
redemption terminal.
(7) (i) Except as set forth in subparagraph (ii), it
shall be unlawful for an individual to use or possess a
cheating or thieving device, counterfeit or altered
billet, ticket, token or similar object accepted by a
video gaming terminal or counterfeit or altered
redemption ticket on the premises of an establishment
licensee.
(ii) An authorized employee of a licensee or an
employee of the board may possess and use a cheating or
thieving device, counterfeit or altered billet, ticket,
token or similar object accepted by a video gaming
terminal or counterfeit or altered redemption ticket in
performance of the duties of employment.
(8) (i) Except as set forth in subparagraph (ii), it
shall be unlawful for an individual to knowingly possess
or use while on the premises of an establishment licensee
a key or device designed for the purpose of and suitable
for opening or entering a video gaming terminal or
redemption terminal that is located on the premises of
the establishment licensee.
(ii) An authorized employee of a licensee or a
member of the board may possess and use a device referred
to in subparagraph (i) in the performance of the duties
of employment.
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(9) It shall be unlawful for a person or licensed entity
to possess a device, equipment or material which the person
or licensed entity knows has been manufactured, distributed,
sold, tampered with or serviced in violation of this part
with the intent to use the device, equipment or material as
though it had been manufactured, distributed, sold, tampered
with or serviced pursuant to this part.
(10) It shall be unlawful for a person to sell, offer
for sale, represent or pass off as lawful any device,
equipment or material that the person or licensed entity
knows has been manufactured, distributed, sold, tampered with
or serviced in violation of this part.
(11) It shall be unlawful for an individual to work or
be employed in a position the duties of which would require
licensing under this part without first obtaining the
requisite license issued under this part.
(12) It shall be unlawful for a licensed entity to
employ or continue to employ an individual in a position the
duties of which require a license under this part if the
individual:
(i) Is not licensed under this part.
(ii) Is prohibited from accepting employment from a
licensee.
(13) It shall be unlawful for a minor to enter and
remain in any video gaming area, except that an individual at
least 18 years of age employed by a terminal operator
licensee, a gaming service provider, an establishment
licensee, the board or another regulatory or emergency
response agency may enter and remain in the area while
engaged in the performance of the individual's employment
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duties.
(14) It shall be unlawful for a minor to wager, play or
attempt to play a video gaming terminal or submit a
redemption ticket into a redemption terminal.
(15) It shall be unlawful for a terminal operator
licensee to require a video gaming terminal wager to be
greater than the stated minimum wager or greater than the
stated maximum wager.
(16) An individual who engages in conduct prohibited by
18 Pa.C.S. § 6308 (relating to purchase, consumption,
possession or transportation of liquor or malt or brewed
beverages) on the premises of an establishment licensee
commits a nongambling offense.
(17) It shall be unlawful for an individual to claim,
collect or take, or attempt to claim, collect or take, money
or anything of value in or from a video gaming terminal or
redemption terminal with the intent to defraud, or to claim,
collect or take an amount greater than the amount won, or to
manipulate with the intent to cheat, a component of a video
gaming terminal or redemption terminal in a manner contrary
to the designed and normal operational purpose.
(b) Criminal penalties and fines.--
(1) (i) A person that commits a first offense in
violation of 18 Pa.C.S. § 4902, 4903 or 4904 in
connection with providing information or making any
statement, whether written or oral, to the board, the
bureau, the department, the Pennsylvania State Police,
the Office of Attorney General or a district attorney as
required by this part commits an offense to be graded in
accordance with the applicable section violated. A person
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that is convicted of a second or subsequent violation of
18 Pa.C.S. § 4902, 4903 or 4904 in connection with
providing information or making any statement, whether
written or oral, to the board, the bureau, the
department, the Pennsylvania State Police, the Office of
Attorney General or a district attorney as required by
this part commits a felony of the second degree.
(ii) A person that violates subsection (a)(2), (3),
(4), (5), (6), (7), (8), (9), (10), (11), (12) or (17)
commits a misdemeanor of the first degree. A person that
is convicted of a second or subsequent violation of
subsection (a)(2), (3), (4), (5), (6), (7), (8), (9),
(10), (11), (12) or (17) commits a felony of the second
degree.
(2) (i) For a first violation of subsection (a)(1),
(2), (3), (4), (5), (6), (7), (8), (9), (10), (11), (12)
or (17), a person shall be sentenced to pay a fine of:
(A) not less than $75,000 nor more than $150,000
if the person is an individual or establishment
licensee;
(B) not less than $300,000 nor more than
$600,000 if the person is a terminal operator
licensee; or
(C) not less than $150,000 nor more than
$300,000 if the person is a licensed manufacturer or
supplier.
(ii) For a second or subsequent violation of
subsection (a)(1), (2), (3), (4), (5), (6), (7), (8),
(9), (10), (11), (12) or (17), a person shall be
sentenced to pay a fine of:
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(A) not less than $150,000 nor more than
$300,000 if the person is an individual or
establishment licensee;
(B) not less than $600,000 nor more than
$1,200,000 if the person is a terminal operator
licensee; or
(C) not less than $300,000 nor more than
$600,000 if the person is a licensed manufacturer or
supplier.
(3) An individual who commits an offense in violation of
subsection (a)(13) or (14) commits a nongambling summary
offense and upon conviction of a first offense shall be
sentenced to pay a fine of not less than $200 nor more than
$1,000. An individual who is convicted of a second or
subsequent offense under subsection (a)(13) or (14) shall be
sentenced to pay a fine of not less than $500 nor more than
$1,500. In addition to the fine imposed, an individual
convicted of an offense under subsection (a)(13) or (14) may
be sentenced to perform a period of community service not to
exceed 40 hours.
(4) An individual who commits an offense in violation of
subsection (a)(16) commits a nongambling offense to be graded
in accordance with 18 Pa.C.S. § 6308 and shall be subject to
the same penalties imposed pursuant to 18 Pa.C.S. §§ 6308 and
6310.4 (relating to restriction of operating privileges)
except that the fine imposed for a violation of subsection
(a)(16) shall be not less than $350 nor more than $1,000.
(c) Board-imposed administrative sanctions.--
(1) In addition to any other penalty authorized by law,
the board may impose without limitation the following
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sanctions:
(i) Revoke the license of a person convicted of a
criminal offense under this part or regulations
promulgated under this part or committing any other
offense or violation of this part or applicable law that
would otherwise disqualify the person from holding the
license.
(ii) Revoke the license of a person determined to
have violated a provision of this part or regulations
promulgated under this part that would otherwise
disqualify the person from holding the license.
(iii) Revoke the license of a person for willfully
and knowingly violating or attempting to violate an order
of the board directed to the person.
(iv) Subject to subsection (g), assess
administrative penalties as necessary to punish
violations of this part.
(v) Order restitution of money or property
unlawfully obtained or retained by a licensee.
(vi) Enter cease and desist orders which specify the
conduct which is to be discontinued, altered or
implemented by a licensee.
(vii) Issue letters of reprimand or censure, which
letters shall be made a permanent part of the file of the
licensee so sanctioned.
(2) (i) If the board refuses to issue or renew a
license, suspends or revokes a license, assesses civil
penalties, orders restitution, enters a cease and desist
order or issues a letter of reprimand or censure, the
board shall provide the applicant or licensee with
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written notification of its decision, including a
statement of the reasons for its decision, by certified
mail within five business days of the decision of the
board.
(ii) The applicant or licensee shall have the right
to appeal the decision in accordance with 2 Pa.C.S. Chs.
5 Subch. A (relating to practice and procedure of
Commonwealth agencies) and 7 Subch. A (relating to
judicial review of Commonwealth agency action).
(d) Aiding and abetting.--A person who aids, abets,
counsels, commands, induces, procures or causes another person
to violate this part shall be subject to all sanctions and
penalties, both civil and criminal, provided under this part.
(e) Continuing offenses.--A violation of this part that is
determined to be an offense of a continuing nature shall be
deemed to be a separate offense on each event or day during
which the violation occurs.
(f) Property subject to seizure, confiscation, destruction
or forfeiture.--Any equipment, device or apparatus, money,
material, gaming proceeds or substituted proceeds or real or
personal property used, obtained or received or an attempt to
use, obtain or receive the device, apparatus, money, material,
proceeds or real or personal property in violation of this part
shall be subject to seizure, confiscation, destruction or
forfeiture.
(g) Penalty limitation.--
(1) Administrative penalties assessed by the board on an
establishment licensee shall not exceed $5,000 for each
noncriminal violation of this part.
(2) When imposing an administrative penalty on an
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establishment licensee for a noncriminal violation of this
part, the board shall take into consideration the
establishment licensee's annual taxable income and whether
the penalty amount would cause the establishment licensee to
cease non-video gaming operations.
(h) Deposit of fines.--Fines imposed and collected by the
board under subsection (c) shall be deposited into the General
Fund.
§ 3906. Report of suspicious transactions.
(a) Duty.--An establishment licensee or a person acting on
behalf of an establishment licensee shall, on a form and in a
manner as required by the bureau, notify the bureau of a
suspicious transaction.
(b) Failure to report.--
(1) A person that is required to file a report of a
suspicious transaction under this section and knowingly fails
to file the report or that knowingly causes another person
having that responsibility to fail to file the report commits
a misdemeanor of the third degree.
(2) A person required to file a report of a suspicious
transaction under this section and fails to file the report
or a person that causes another person required under this
section to file the report to fail to file the report shall
be strictly liable for the person's actions and may be
subject to sanction under section 3905(c) (relating to
prohibited acts and penalties).
(c) Bureau.--The bureau shall maintain a record of all
reports made under this section for a period of five years. The
bureau shall make the reports available to any Federal or State
law enforcement agency upon written request and without
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necessity of subpoena.
(d) Notice prohibited.--
(1) A person that is required to file a report of a
suspicious transaction under this section may not notify an
individual suspected of committing the suspicious transaction
that the transaction has been reported.
(2) A person that violates this subsection commits a
misdemeanor of the third degree and may be subject to
sanction under section 3905(c).
(e) Immunity.--A person that is required to file a report of
a suspicious transaction under this section and in good faith
makes the report shall not be liable in any civil action brought
by a person for making the report, regardless of whether the
transaction is later determined to be a suspicious transaction.
(f) Sanctions.--
(1) In considering appropriate administrative sanctions
against a person for violating this section, the board shall
consider all of the following:
(i) The risk to the public and to the integrity of
gaming operations created by the conduct of the person.
(ii) The seriousness of the conduct of the person
and whether the conduct was purposeful and with knowledge
that it was in contravention of the provisions of this
part or regulations promulgated under this part.
(iii) Justification or excuse for the conduct by the
person.
(iv) The prior history of the particular licensee or
person involved with respect to video gaming terminal
activity.
(v) The corrective action taken by the establishment
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licensee to prevent future misconduct of a like nature
from occurring.
(vi) In the case of a monetary penalty, the amount
of the penalty in relation to the severity of the
misconduct and the financial means of the licensee or
person. The board may impose any schedule or terms of
payment of such penalty as it may deem appropriate.
(2) It shall be no defense to disciplinary action before
the board that a person inadvertently, unintentionally or
unknowingly violated this section. The factors enumerated
under paragraph (1) shall only apply to the degree of the
penalty to be imposed by the board and not to a finding of a
violation itself.
(g) Regulations.--The board shall promulgate regulations to
effectuate the purposes of this section.
§ 3907. Additional authority.
(a) Petition for access to agency information.--
(1) The director of the Office of Enforcement Counsel
within the bureau may petition a court of record having
jurisdiction over information in the possession of an agency
in this Commonwealth or, if there is no such court, then the
Commonwealth Court for authorization to review or obtain
information in the possession of an agency in this
Commonwealth by averring specific facts demonstrating that:
(i) The agency has in its possession information
material to a pending investigation or inquiry being
conducted by the bureau pursuant to this part.
(ii) Disclosure or release of the information is in
the best interest of the Commonwealth.
(2) The petition shall request that the court enter a
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rule upon the agency to show cause why the agency should not
be directed to disclose to the bureau, or identified agents
thereof, information in the agency's possession about any
pending matter under the jurisdiction of the bureau pursuant
to this part.
(3) If the respondent is a local agency, a copy of a
rule issued pursuant to this section shall be provided to the
district attorney of the county in which the local agency is
located and the Office of Attorney General.
(4) Upon request of a local agency, the district
attorney or the Attorney General may elect to enter an
appearance to represent the local agency in the proceedings.
(b) Procedure.--
(1) The filing of a petition pursuant to this section
and related proceedings shall be in accordance with court
rule, including issuance as of course.
(2) A party to the proceeding may not disclose the
filing of a petition or answer or the receipt, content or
disposition of a rule or order issued pursuant to this
section, without leave of court.
(3) A party to the proceedings may request that the
record be sealed and proceedings be closed. The court shall
grant the request if it is in the best interest of a person
or the Commonwealth to do so.
(c) Court determination.--
(1) Following review of the record, the court shall
grant the relief sought by the director of the Office of
Enforcement Counsel if the court determines that:
(i) The agency has in its possession information
material to the investigation or inquiry.
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(ii) Disclosure or release of the information is in
the best interest of the Commonwealth.
(iii) The disclosure or release of the information
is not otherwise prohibited by statute or regulation.
(iv) The disclosure or release of the information
would not inhibit an agency in the performance of the
agency's duties.
(2) If the court so determines, the court shall enter an
order authorizing and directing the information be made
available for review in camera.
(d) Release of materials or information.--
(1) If, after an in-camera review by the court, the
director of the Office of Enforcement Counsel seeks to obtain
copies of materials in the agency's possession, the court
may, if not otherwise prohibited by statute or regulation,
enter an order that the requested materials be provided.
(2) An order authorizing the release of materials or
other information shall contain direction regarding the
safekeeping and use of the materials or other information
sufficient to satisfy the court that the materials or
information will be sufficiently safeguarded.
(3) In making the determination under paragraph (2) the
court shall consider input of the agency in possession of the
information and input from any agency with which the
information originated concerning a pending investigation or
ongoing matter and the safety of person and property.
(e) Modification of order.--
(1) If subsequent investigation or inquiry by the bureau
warrants modification of an order entered pursuant to this
section, the director of the Office of Enforcement Counsel
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may petition to request modification of the order.
(2) Upon the request, the court may modify the order at
any time and in any manner it deems necessary and
appropriate.
(3) The agency named in the original petition shall be
given notice and an opportunity to be heard.
(f) Use of information or materials.--A person who, by any
means authorized by this section, has obtained knowledge of
information or materials solely pursuant to this section may use
the information or materials in a manner consistent with any
direction imposed by the court and appropriate to the proper
performance of the person's duties under this part.
(g) Violation.--In addition to the remedies and penalties
provided in this part, a violation of the provisions of this
section may be punished as contempt of court.
(h) Definition.--As used in this section, the term "agency"
shall mean a "Commonwealth agency" or a "local agency" as those
terms are defined in section 102 of the act of February 14, 2008
(P.L.6, No.3), known as the Right-to-Know Law.
§ 3908. Detention.
(a) General rule.--A peace officer who has probable cause to
believe that criminal violation of this part has occurred or is
occurring on or about an establishment licensee's premises and
who has probable cause to believe that a specific individual has
committed or is committing the criminal violation may detain the
individual in a reasonable manner for a reasonable time on the
premises of the establishment licensee to require the suspect to
identify himself, to verify such identification or to inform a
peace officer.
(b) Immunity.--A peace officer shall not be subject to civil
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or criminal liability for detention of an individual in
accordance with subsection (a).
CHAPTER 41
REVENUES
Sec.
4101. Fees.
4102. Taxes and assessments.
4103. Distribution of local share.
4104. Regulatory assessments.
4105. Transfers from Video Gaming Fund.
4106. Fire Company and Emergency Responder Grant Fund.
4107. Club licensees.
§ 4101. Fees.
(a) Application fees.--The following nonrefundable
application fees shall accompany an application for the
following licenses or permits applied for under Chapter 35
(relating to application and licensure):
(1) For a manufacturer or supplier license, $50,000.
(2) For a terminal operator license, $25,000.
(3) For an establishment license, $100.
(4) For a key employee or principal license, $500.
(5) For any other authorization or permit authorized by
this part, an amount established by the board, through
regulation, which may not exceed $100.
(b) Initial license and renewal fees.--The following
nonrefundable fees shall be required upon issuance of an initial
license and shall accompany an application for renewal for the
following licenses or permits under Chapter 35:
(1) For a manufacturer or supplier license, $10,000.
(2) For a terminal operator license, $5,000.
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(3) For an establishment license, an amount equal to
$250 per each video gaming terminal in operation at the
premises of the establishment licensee.
(4) For a key employee, procurement agent license or
principal license, $500.
(5) For any other authorization or license authorized by
this part, an amount established by the board, through
regulation, which may not exceed $100.
(c) Terminal increase fee.--An establishment licensee that
increases the total number of video gaming terminals within the
establishment after submission of the renewal fee required in
subsection (b) shall provide the board with a $250 renewal fee
for each additional video gaming terminal added to the
establishment within 60 days of installation of each additional
video gaming terminal.
(d) Deposit of fees.--Fees collected under this section
shall be deposited into the General Fund.
§ 4102. Taxes and assessments.
(a) Fund established.--The Video Gaming Fund is established
in the State Treasury. Money in the fund is hereby appropriated
to the department on a continuing basis for the purposes under
subsection (c).
(b) Video gaming terminal tax and assessments.--
(1) The department shall determine and each terminal
operator licensee shall pay on a bimonthly basis:
(i) A tax of 34% of its gross terminal revenue from
all video gaming terminals operated by the terminal
operator licensee within this Commonwealth.
(ii) A 4% local share assessment from its gross
terminal revenue.
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(iii) A regulatory assessment established in section
4104 (relating to regulatory assessments) from the
terminal operator licensee's weekly gross terminal
revenue.
(2) All money owed under this section shall be held in
trust by the terminal operator licensee until the money is
paid or transferred to the Video Gaming Fund.
(3) Unless otherwise agreed to by the board, a terminal
operator licensee shall establish a separate bank account to
maintain gross terminal revenue until such time as the money
is paid or transferred under this section.
(c) Transfers and distributions.--The department shall:
(1) Transfer the tax imposed under subsection (b) to the
Video Gaming Fund.
(2) From the local share assessment established under
subsection (b), make distributions among the municipalities
that host establishment licensees in accordance with section
4103 (relating to distribution of local share).
(3) Transfer the regulatory assessment imposed under
subsection (b) in accordance with section 4104.
§ 4103. Distribution of local share.
(a) Distribution.--
(1) Subject to the limitation under subsection (c), the
department shall distribute, in a manner and according to a
schedule adopted by the department, to each municipality 2%
of the gross terminal revenue of each video gaming terminal
operating within the municipality.
(2) The department shall distribute, in a manner and
according to a schedule adopted by the department, to each
county 2% of the gross terminal revenue of each video gaming
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terminal operating within the county.
(b) Duty of terminal operator.--A terminal operator licensee
shall continuously provide the department with records,
documents or other information necessary to effectuate the
requirements of subsection (a).
(c) Limitation.--The department may not distribute a local
share amount to a municipality in excess of 50% of the
municipality's total budget for fiscal year 2017, adjusted for
inflation in subsequent fiscal years by an amount not to exceed
an annual cost-of-living adjustment calculated by applying an
upward percentage change in the Consumer Price Index immediately
prior to the date the adjustment is due to take effect.
(d) Transfers to fund.--Local share amounts not distributed
by the department to a municipality due to the limitation
established under subsection (c) shall be transferred to the
host county.
(e) Use of assessments.--A municipality or county that
receives assessments from the department under subsection (a)
may use the funds for any purpose and as local matching funds
for other grants or loans from the Commonwealth.
(f) Reporting.--
(1) In cooperation with the department, the Department
of Community and Economic Development shall submit an annual
report on all distributions of local share assessments to
municipalities and counties under this section to the
chairperson and minority chairperson of the Appropriations
Committee of the Senate, the chairperson and minority
chairperson of the Community, Economic and Recreational
Development Committee of the Senate, the chairperson and
minority chairperson of the Appropriations Committee of the
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House of Representatives and the chairperson and minority
chairperson of the Gaming Oversight Committee of the House of
Representatives. The report shall be submitted by August 31,
2018, and by August 31 of each year thereafter.
(2) A municipality or county that receives distributions
of local share assessments under this section shall submit
information to the Department of Community and Economic
Development on a form prepared by the Department of Community
and Economic Development that states the amount and use of
the funds received in the prior fiscal year. The form shall
specify whether the funds received were deposited in the
municipality's or county's General Fund or committed to a
specific project or use.
(g) Definition.--As used in this section, the term "Consumer
Price Index" means the Consumer Price Index for All Urban
Consumers for the Pennsylvania, New Jersey, Delaware and
Maryland area for the most recent 12-month period for which
figures have been officially reported by the United States
Department of Labor, Bureau of Labor Statistics.
§ 4104. Regulatory assessments.
(a) Accounts established.--The State Treasurer shall
establish within the State Treasury an account for each terminal
operator for the deposit of a regulatory assessment amount
required under subsection (b) to recover costs or expenses
incurred by the board, the department, the Pennsylvania State
Police and the Office of Attorney General in carrying out their
powers and duties under this part based upon a budget submitted
by the department under subsection (c).
(b) Weekly deposits.--
(1) The department shall determine the appropriate
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assessment amount for each terminal operator licensee, which
shall be a percentage assessed on the terminal operator
licensee's weekly gross terminal revenue.
(2) The percentage assessed shall not exceed an amount
equal to the lesser of:
(i) the costs or expenses incurred by the board, the
department, the Pennsylvania State Police or the Office
of Attorney General in carrying out their powers and
duties under this part based upon a budget submitted by
the department under subsection (c); or
(ii) one and one-half percent of the terminal
operator licensee's weekly gross terminal revenue.
(c) Itemized budget reporting.--
(1) The department shall prepare and annually submit to
the chairperson of the Appropriations Committee of the Senate
and the chairperson of the Appropriations Committee of the
House of Representatives an itemized budget consisting of
amounts to be appropriated out of the accounts established
under this section necessary to administer this part.
(2) As soon as practicable after submitting copies of
the itemized budget, the department shall submit to the
chairperson of the Appropriations Committee of the Senate and
the chairperson of the Appropriations Committee of the House
of Representatives analyses of and recommendations regarding
the itemized budget.
(d) Appropriation.--Costs and expenses may be paid from the
accounts established under subsection (a) only upon
appropriation by the General Assembly.
§ 4105. Transfers from Video Gaming Fund.
(a) Transfer to Property Tax Relief Fund.--
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(1) On June 30, 2018, and on the last day of each fiscal
year thereafter, the State Treasurer shall transfer from the
Video Gaming Fund to the Property Tax Relief Fund an amount
equal to:
(i) The total amount of money in the Property Tax
Relief Fund on the last day of the prior fiscal year
adjusted for inflation by applying the percentage change
in the Consumer Price Index, minus:
(ii) The total amount of money in the Property Tax
Relief Fund on the last day of the current fiscal year.
(2) The transfer under this subsection shall be made
prior to the transfers under subsections (b), (c) and (d).
(b) Transfer for compulsive and problem gambling
treatment.--On June 30, 2018, and on the last day of each fiscal
year thereafter, the State Treasurer shall transfer from the
Video Gaming Fund the sum of $2,500,000 or an amount equal to
0.002 multiplied by the total gross terminal revenue of all
terminal operator licensees, whichever is greater, to the
Compulsive and Problem Gambling Treatment Fund established in
section 1509 (relating to compulsive and problem gambling
program).
(c) Transfer to Fire Company and Emergency Responder Grant
Fund.--On June 30, 2018, and on the last day of each fiscal year
thereafter, the State Treasurer shall transfer from the Video
Gaming Fund the sum of $2,500,000 to the Fire Company and
Emergency Responder Grant Fund established in section 4106
(relating to Fire Company and Emergency Responder Grant Fund).
(d) Transfer for drug and alcohol treatment.--On June 30,
2018, and on the last day of each fiscal year thereafter, the
State Treasurer shall transfer from the Video Gaming Fund the
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sum of $2,500,000 to the Department of Drug and Alcohol Programs
to be used to provide drug and alcohol addiction treatment
services, including treatment for drug and alcohol addiction
related to compulsive and problem gambling, as set forth in
section 1509.1 (relating to drug and alcohol treatment)
(e) General Fund transfer.--On June 30, 2018, and on the
last day of each fiscal year thereafter, the State Treasurer
shall transfer the remaining balance in the Video Gaming Fund
that is not transferred under subsections (a), (b), (c) and (d)
to the General Fund.
(f) Consumer Price Index.--For purposes of subsection (a),
references to the Consumer Price Index shall mean the Consumer
Price Index for All Urban Consumers for the Pennsylvania, New
Jersey, Delaware and Maryland area for the most recent 12-month
period for which figures have been officially reported by the
United States Department of Labor, Bureau of Labor Statistics.
§ 4106. Fire Company and Emergency Responder Grant Fund.
(a) Establishment.--The Fire Company and Emergency Responder
Grant Fund is established in the State Treasury. The fund shall
receive money from the Video Gaming Fund in accordance with
section 4105 (relating to transfers from Video Gaming Fund).
(b) Use of money.--Money in the fund shall be used to fund
programs that provide grants to fire companies and other
emergency responders as specified through a separate act of the
General Assembly.
§ 4107. Club licensees.
(a) Distribution.--The gross terminal revenue received by a
club licensee shall be distributed as follows:
(1) No less than 60% of the gross terminal revenue shall
be paid for public interest purposes within one year of the
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end of the calendar year in which the gross terminal revenue
was obtained.
(2) No more than 40% of the gross terminal revenue
obtained in a calendar year may be retained by a club
licensee.
(b) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Club licensee." As defined in section 103 of the act of
December 19, 1988 (P.L.1262, No.156), known as the Local Option
Small Games of Chance Act.
"Public interest purpose." As defined in section 103 of the
Local Option Small Games of Chance Act.
CHAPTER 43
ETHICS
Sec.
4301. Board code of conduct.
4302. Additional board restrictions.
4303. Financial and employment interests.
4304. Additional restrictions.
4305. Political influence.
§ 4301. Board code of conduct.
(a) Update required.--The board shall update the
comprehensive code of conduct established under section 1202.1
(relating to code of conduct) prior to the consideration of a
license, permit or other authorization under this part in order
to avoid a perceived or actual conflict of interest and to
promote public confidence in the integrity and impartiality of
the board as related to video gaming. At a minimum, the updated
code of conduct adopted under this section shall include
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registration of licensed entity representatives under subsection
(b) and the restrictions under subsection (c) as they relate to
video gaming.
(b) Registration.--
(1) A licensed entity representative shall register with
the board in a manner prescribed by the board. The
registration shall include the name, employer or firm,
business address and business telephone number of both the
licensed entity representative and any licensed entity,
applicant for licensure or other person being represented.
(2) A licensed entity representative shall update the
registration information on an ongoing basis and failure to
do so shall be punishable by the board.
(3) The board shall maintain a registration list that
contains the information required under paragraph (1). The
list shall be available for public inspection at the offices
of the board and on the board's publicly accessible Internet
website.
(c) Restrictions.--In addition to the other prohibitions
contained in this part, a member of the board shall:
(1) Not accept a discount, gift, gratuity, compensation,
travel, lodging or other thing of value, directly or
indirectly, from an applicant, licensed entity, affiliate,
subsidiary or intermediary of an applicant or a licensed
entity, registrant or licensed entity representative.
(2) Disclose and recuse himself from a hearing or other
proceeding in which the member's objectivity, impartiality,
integrity or independence of judgment may be reasonably
questioned due to the member's relationship or association
with a party connected to a hearing or proceeding or a person
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appearing before the board.
(3) Refrain from financial or business dealing that
would tend to reflect adversely on the member's objectivity,
impartiality or independence of judgment.
(4) (i) Not solicit funds for a charitable,
educational, religious, health, fraternal, civic or other
nonprofit entity from an applicant, licensed entity,
party, registrant or licensed entity representative or
from an affiliate, subsidiary, intermediary or holding
company of an applicant, licensed entity, party or
licensed entity representative.
(ii) Subject to the provisions of section 1201(h)
(4.1) (relating to Pennsylvania Gaming Control Board
established), a member may serve as an officer, employee
or member of the governing body of a nonprofit entity and
may attend, make personal contributions to and plan or
preside over the entity's fundraising events.
(iii) A member may permit their name to appear on
the letterhead used for fundraising events if the
letterhead contains only the member's name and position
with the nonprofit entity.
(5) (i) Not meet or engage in discussions with an
applicant, licensed entity, registrant, licensed entity
representative, person who provides goods, property or
services to a terminal operator licensee or another
person or entity under the jurisdiction of the board
unless the meeting or discussion occurs on the business
premises of the board and is recorded in a log.
(ii) The log must be available for public inspection
during the regular business hours of the board and shall
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be posted on the board's publicly accessible Internet
website.
(iii) The log must include the date and time of the
meeting or discussion, the names of the participants and
the subject discussed.
(iv) The provisions of this paragraph shall not
apply to a meeting that considers matters requiring the
physical inspection of the equipment or premises of an
applicant or a licensed entity, if the meeting is entered
in the log.
(6) Avoid impropriety and the appearance of impropriety
at all times and observe standards and conduct that promote
public confidence in the oversight of video gaming.
(7) Comply with other laws, rules or regulations
relating to the conduct of a member.
§ 4302. Additional board restrictions.
(a) Board restrictions.--The following shall apply to a
board member or employee of the board whose duties substantially
involve licensing, enforcement, development of law, promulgation
of regulations or development of policy relating to gaming under
this part or who has other discretionary authority which may
affect or influence the outcome of an action, proceeding or
decision under this part, including the executive director,
bureau directors and attorneys:
(1) The individual may not, for a period of two years
following termination of employment, accept employment with
or be retained by an applicant or a licensed entity or by an
affiliate, intermediary, subsidiary or holding company of an
applicant or a licensed entity.
(2) The individual may not, for a period of two years
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following termination of employment, appear before the board
in a hearing or proceeding or participate in activity on
behalf of an applicant, licensee or licensed entity or on
behalf of an affiliate, intermediary, subsidiary or holding
company of an applicant, licensee or licensed entity.
(3) (i) An applicant or a licensed entity or an
affiliate, intermediary, subsidiary or holding company of
an applicant or a licensed entity may not, until the
expiration of two years following termination of
employment, employ or retain the individual.
(ii) Violation of this subparagraph shall result in
termination of the individual's employment and subject
the violator to section 3905(c) (relating to prohibited
acts and penalties).
(4) (i) A prospective employee who, upon employment,
would be subject to this subsection must, as a condition
of employment, sign an affidavit that the prospective
employee will not violate paragraph (1) or (2).
(ii) If the prospective employee fails to sign the
affidavit, the board shall rescind an offer of employment
and may not employ the individual.
(b) Contractor restrictions.--The following shall apply to
an independent contractor of the board and to an employee of an
independent contractor whose duties substantially involve
consultation relating to licensing, enforcement, development of
law, promulgation of regulations or development of policy
relating to video gaming under this part:
(1) The person may not, for a period of one year
following termination of the contract with the board, be
retained by an applicant or a licensed entity or by an
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affiliate, intermediary, subsidiary or holding company of an
applicant or a licensed entity.
(2) The person may not, for a period of two years
following termination of the contract with the board, appear
before the board in a hearing or proceeding or participate in
activity on behalf of an applicant, licensee or licensed
entity or on behalf of an affiliate, intermediary, subsidiary
or holding company of an applicant, licensee or licensed
entity.
(3) (i) An applicant or a licensed entity or an
affiliate, intermediary, subsidiary or holding company of
an applicant or a licensee may not, until the expiration
of one year following termination of the contract with
the board, employ or retain the person.
(ii) A knowing violation of this subparagraph shall
result in termination of the person's employment and
subject the violator to section 3905(c).
(4) (i) Each contract between the board and an
independent contractor that involves the duties specified
in this subsection shall contain a provision requiring
the independent contractor to sign an affidavit that the
independent contractor will not violate paragraph (1) or
(2).
(ii) If the independent contractor fails to sign the
affidavit, the board may not enter into the contract or
must terminate the contract.
(5) (i) An independent contractor shall require a
prospective employee whose employment would involve the
duties specified in this subsection to sign an affidavit
that the prospective employee will not violate paragraph
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(1) or (2).
(ii) If the prospective employee fails to sign the
affidavit, the independent contractor shall rescind an
offer of employment and may not employ the individual.
(c) Construction.--Nothing under subsection (a) or (b) shall
be construed to prevent a current or former employee of the
board, a current or former independent contractor or a current
or former employee of an independent contractor from appearing
before the board in a hearing or proceeding as a witness or
testifying as to any fact or information.
(d) Ethics commission.-
(1) The State Ethics Commission shall issue a written
determination of whether a person is subject to subsection
(a) or (b) upon the written request of the person or the
person's employer or potential employer. A person that relies
in good faith on a determination issued under this paragraph
shall not be subject to a penalty for an action taken,
provided that all material facts specified in the request for
the determination are correct.
(2) (i) The State Ethics Commission shall publish a
list of all employment positions within the board and
employment positions within independent contractors whose
duties would subject the individuals in those positions
to the provisions of subsections (a) and (b).
(ii) The board and each independent contractor shall
assist the State Ethics Commission in the development of
the list, which shall be published by the State Ethics
Commission in the Pennsylvania Bulletin biennially and
posted by the board on the board's publicly accessible
Internet website.
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(iii) Upon request, employees of the board and each
independent contractor shall provide the State Ethics
Commission with adequate information to accurately
develop and maintain the list.
(iv) The State Ethics Commission may impose a civil
penalty under 65 Pa.C.S. § 1109(f) (relating to
penalties) upon an individual who fails to cooperate with
the State Ethics Commission under this paragraph.
(v) An individual who relies in good faith on the
list published by the State Ethics Commission shall not
be subject to a penalty for a violation of subsection (a)
or (b).
§ 4303. Financial and employment interests.
(a) Financial interests.--Except as may be provided for the
judiciary by rule or order of the Pennsylvania Supreme Court, an
executive-level public employee, public official or party
officer, or an immediate family member thereof, shall not
intentionally or knowingly hold a financial interest in an
applicant or a licensee, or in a holding company, affiliate,
intermediary or subsidiary thereof, while the individual is an
executive-level public employee, public official or party
officer and for one year following termination of the
individual's status as an executive-level public employee,
public official or party officer.
(b) Employment.--Except as may be provided by rule or order
of the Pennsylvania Supreme Court and except as provided in
section 1202.1 (relating to code of conduct) or 4304 (relating
to additional restrictions), no executive-level public employee,
public official or party officer, or an immediate family member
thereof, shall be employed by an applicant or licensee, or by a
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holding company, affiliate, intermediary or subsidiary thereof,
while the individual is an executive-level public employee,
public official or party officer and for one year following
termination of the individual's status as an executive-level
public employee, public official or party officer.
(c) Complimentary services.--
(1) No executive-level public employee, public official
or party officer, or an immediate family member thereof,
shall solicit or accept a complimentary service from an
applicant or licensee, or from an affiliate, intermediary,
subsidiary or holding company thereof, which the executive-
level public employee, public official or party officer, or
an immediate family member thereof, knows or has reason to
know is other than a service or discount which is offered to
members of the general public in like circumstances.
(2) No applicant or licensee, or an affiliate,
intermediary, subsidiary or holding company thereof, shall
offer or deliver to an executive-level public employee,
public official or party officer, or an immediate family
member thereof, a complimentary service from the applicant or
licensee, or an affiliate, intermediary, subsidiary or
holding company thereof, that the applicant or licensee, or
an affiliate, intermediary, subsidiary or holding company
thereof, knows or has reason to know is other than a service
or discount that is offered to members of the general public
in like circumstances.
(d) Grading.--An individual who violates this section
commits a misdemeanor of the third degree and shall, upon
conviction, be sentenced to pay a fine of not more than $1,000
or to imprisonment for not more than one year, or both.
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(e) Divestiture.--
(1) An executive-level public employee, public official
or party officer, or an immediate family member thereof, who
holds a financial interest prohibited by this section shall
divest the financial interest within three months of the
effective date of this section, as applicable.
(2) An executive-level public employee, public official,
party officer or immediate family member shall have 30 days
from the date the individual knew or had reason to know of
the violation or 30 days from the publication in the
Pennsylvania Bulletin under section 3301(b)(12) (relating to
powers of board) of the application or licensure of the
executive-level public employee, public official, party
officer or immediate family member, whichever occurs earlier,
to divest the financial interest.
(3) The State Ethics Commission may, for good cause,
extend the time period under this subsection.
(f) State Ethics Commission.--The State Ethics Commission
shall do all of the following:
(1) (i) Issue a written determination of whether a
person is subject to subsection (a), (b) or (c) upon the
written request of the person or another person that may
have liability for an action taken with respect to the
person.
(ii) A person that relies in good faith on a
determination made under this paragraph shall not be
subject to penalty for an action taken, provided that all
material facts specified in the request for the
determination are correct.
(2) (i) Publish a list of all State, county, municipal
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and other government positions that meet the definitions
of "public official" as defined under subsection (g) or
"executive-level public employee" as defined under
section 3102 (relating to definitions).
(ii) The Office of Administration shall assist the
State Ethics Commission in the development of the list,
which list shall be published by the State Ethics
Commission in the Pennsylvania Bulletin biennially and
posted by the board on the board's publicly accessible
Internet website.
(iii) Upon request, a public official shall provide
the State Ethics Commission with adequate information to
accurately develop and maintain the list.
(iv) The State Ethics Commission may impose a civil
penalty under 65 Pa.C.S. § 1109(f) (relating to
penalties) upon an individual, including a public
official or executive-level public employee, who fails to
cooperate with the State Ethics Commission under this
subsection.
(v) A person that relies in good faith on the list
published by the State Ethics Commission shall not be
subject to penalty for a violation of this section.
(g) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Applicant." A person applying for a manufacturer license,
supplier license or terminal operator license under this part.
"Financial interest." Owning or holding, or being deemed to
hold, debt or equity securities or other ownership interest or
profits interest. A financial interest shall not include a debt
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or equity security, or other ownership interest or profits
interest, which is held or deemed to be held in any of the
following:
(1) A blind trust over which the executive-level public
employee, public official, party officer or immediate family
member thereof may not exercise any managerial control or
receive income during the tenure of office and the period
under subsection (a). The provisions of this paragraph shall
apply only to blind trusts established prior to the effective
date of this section.
(2) Securities that are held in a pension plan, profit-
sharing plan, individual retirement account, tax-sheltered
annuity, a plan established pursuant to section 457 of the
Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. §
1 et seq.) or a successor provision deferred compensation
plan whether qualified or not qualified under the Internal
Revenue Code of 1986 or any successor provision or other
retirement plan that:
(i) is not self-directed by the individual; and
(ii) is advised by an independent investment adviser
who has sole authority to make investment decisions with
respect to contributions made by the individual to these
plans.
(3) A tuition account plan organized and operated under
section 529 of the Internal Revenue Code of 1986 that is not
self-directed by the individual.
(4) A mutual fund where the interest owned by the mutual
fund in a licensed entity does not constitute a controlling
interest as defined in this part.
"Immediate family." A spouse, minor child or unemancipated
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child.
"Licensee." A manufacturer licensee, supplier licensee or a
terminal operator licensee.
"Party officer." A member of a national committee; a
chairperson, vice chairperson, secretary, treasurer or counsel
of a State committee or member of the executive committee of a
State committee; a county chairperson, vice chairperson,
counsel, secretary or treasurer of a county committee in which a
licensed facility is located; or a city chairperson, vice
chairperson, counsel, secretary or treasurer of a city committee
of a city in which a licensed facility is located.
"Public official." The term shall include the following:
(1) The Governor, Lieutenant Governor, a member of the
Governor's cabinet, State Treasurer, Auditor General and
Attorney General of the Commonwealth.
(2) A member of the Senate or House of Representatives
of the Commonwealth.
(3) An individual elected or appointed to an office of a
county or municipality that directly receives a distribution
of revenue under this part.
(4) An individual elected or appointed to a department,
agency, board, commission, authority or other governmental
body not included in paragraph (1), (2) or (3) that directly
receives a distribution of revenue under this part.
(5) An individual elected or appointed to a department,
agency, board, commission, authority, county, municipality or
other governmental body not included in paragraph (1), (2) or
(3) with discretionary power that may influence or affect the
outcome of an action or decision and who is involved in the
development of regulation or policy relating to a licensed
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entity or is involved in other matters under this part.
§ 4304. Additional restrictions.
(a) Restrictions.--
(1) No individual trooper or employee of the
Pennsylvania State Police or employee of the Office of
Attorney General or the department whose duties substantially
involve licensing or enforcement, the development of laws or
the development or adoption of regulations or policy related
to gaming under this part or who has other discretionary
authority that may affect or influence the outcome of an
action, proceeding or decision under this part may do any of
the following:
(i) Accept employment with or be retained by an
applicant or licensed entity, or an affiliate,
intermediary, subsidiary or holding company of an
applicant or licensed entity, for a period of two years
after the termination of employment.
(ii) (A) Appear before the board in a hearing or
proceeding or participate in other activity on behalf
of an applicant, licensee or licensed entity, or an
affiliate, intermediary, subsidiary or holding
company of an applicant, licensee or licensed entity,
for a period of two years after termination of
employment.
(B) Nothing in this paragraph shall be construed
to prevent a current or former trooper or employee of
the Pennsylvania State Police, the Office of Attorney
General or the department from appearing before the
board in a proceeding or hearing as a witness or
testifying as to a fact or information.
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(2) As a condition of employment, a potential employee
who would be subject to this subsection shall sign an
affidavit that the individual will not accept employment with
or be retained by an applicant or licensed entity, or an
affiliate, intermediary, subsidiary or holding company of an
applicant or licensed entity, for a period of two years after
the termination of employment.
(b) Employment or retention.--
(1) No applicant or licensed entity or an affiliate,
intermediary, subsidiary or holding company of an applicant
or licensed entity may employ or retain an individual subject
to subsection (a) until the expiration of the period required
in subsection (a)(1)(i).
(2) An applicant or licensed entity, or an affiliate,
intermediary, subsidiary or holding company of an applicant
or licensed entity, that knowingly employs or retains an
individual in violation of this subsection shall terminate
the employment of the individual and be subject to penalty
under section 1518(c) (relating to prohibited acts;
penalties).
(c) Violation.--If an individual subject to subsection (a)
refuses or otherwise fails to sign an affidavit, the
individual's potential employer shall rescind the offer of
employment.
(d) Code of conduct.--
(1) The Pennsylvania State Police, Office of Attorney
General and department each shall adopt a comprehensive code
of conduct that supplements all other requirements under this
part and 65 Pa.C.S. Pt. II (relating to accountability), as
applicable, and shall provide guidelines applicable to
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troopers, employees, independent contractors of the agency
whose duties substantially involve licensing or enforcement,
the development of laws or the development or adoption of
regulations or policy related to video gaming under this part
or who have other discretionary authority that may affect the
outcome of an action, proceeding or decision under this part,
and the immediate families of these individuals to enable
them to avoid a perceived or actual conflict of interest and
to promote public confidence in the integrity and
impartiality of video gaming enforcement and regulation.
(2) At a minimum, the code of conduct adopted under this
section shall apply the types of restrictions applicable to
members under section 1202.1(c) (relating to code of
conduct), except that the restrictions under section
1202.1(c)(5) shall not apply to an elected Attorney General.
(e) State Ethics Commission.--The State Ethics Commission
shall do all of the following:
(1) (i) Issue a written determination of whether an
individual is subject to subsection (a) upon the written
request of the individual or the individual's employer or
potential employer.
(ii) A person that relies in good faith on a
determination made under this paragraph shall not be
subject to penalty for an action taken, provided that all
material facts specified in the request for the
determination are correct.
(2) (i) Publish a list of all positions within the
Pennsylvania State Police, the Office of Attorney General
and the department the duties of which would subject the
individuals in those positions to the provisions of
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subsection (a).
(ii) Each agency subject to this subsection shall
assist the State Ethics Commission in the development of
the list, which list shall be published by the State
Ethics Commission in the Pennsylvania Bulletin
biennially, shall be posted by the board on the board's
publicly accessible Internet website and shall be posted
by each agency on the agency's publicly accessible
Internet website.
(iii) Upon request by the State Ethics Commission,
members and employees of each agency subject to this
subsection shall provide the State Ethics Commission with
adequate information to accurately develop and maintain
the list.
(iv) The State Ethics Commission may impose a civil
penalty under 65 Pa.C.S. § 1109(f) (relating to
penalties) upon an individual who fails to cooperate with
the State Ethics Commission under this subsection.
(v) A person who relies in good faith on the list
published by the State Ethics Commission shall not be
subject to penalty for a violation of subsection (a).
§ 4305. Political influence.
(a) Contribution restriction.--The following persons shall
be prohibited from contributing money or an in-kind contribution
to a candidate for nomination or election to a public office in
this Commonwealth, to a political party committee or other
political committee in this Commonwealth or to a group,
committee or association organized in support of a candidate,
political party committee or other political committee in this
Commonwealth:
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(1) An applicant for a terminal operator license,
manufacturer license, supplier license, principal license or
a key employee license.
(2) A terminal operator licensee, manufacturer licensee
or supplier licensee.
(3) A licensed principal or licensed key employee of a
terminal operator licensee, manufacturer licensee or supplier
licensee.
(4) An affiliate, intermediary, subsidiary or holding
company of a terminal operator licensee, manufacturer
licensee or supplier licensee.
(5) A licensed principal or licensed key employee of an
affiliate, intermediary, subsidiary or holding company of a
terminal operator licensee, manufacturer licensee or supplier
licensee.
(6) A person who holds a similar video gaming license in
another jurisdiction and the affiliates, intermediaries,
subsidiaries, holding companies, principals or key employees
thereof.
(b) Contributions to certain associations and organizations
barred.--No individual prohibited from making political
contributions under subsection (a) may make a political
contribution of money or an in-kind contribution to an
association or organization, including a nonprofit organization,
that has been solicited by, or knowing that the contribution or
a portion thereof will be contributed to, the elected official,
executive-level public employee or candidate for nomination or
election to a public office in this Commonwealth.
(c) Internet website.--
(1) The board shall establish a publicity accessible
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Internet website that includes a list of all applicants for
and holders of a terminal operator license, manufacturer
license or supplier license and the affiliates,
intermediaries, subsidiaries, holding companies, principals
and key employees thereof, all persons holding a similar
video gaming license in another jurisdiction, and the
affiliates, intermediaries, subsidiaries, holding companies,
principals and key employees thereof, and other entity in
which the applicant or licensee has a debt or an equity
security or other ownership or profits interest. An applicant
or licensee shall notify the board within seven days of the
discovery of a change in or addition to the information. The
list shall be published semiannually in the Pennsylvania
Bulletin.
(2) No individual who acts in good faith and in reliance
on the information on the board's publicly accessible
Internet website shall be subject to penalty or liability
imposed for a violation of this section.
(3) The board shall request the information required
under paragraph (1) from a person licensed in another
jurisdiction who does not hold a license in this Commonwealth
and from regulatory agencies in the other jurisdiction. If a
person who is a licensee in another jurisdiction refuses to
provide the information required under paragraph (1), the
person and its officers, directors or persons with a
controlling interest shall be ineligible to receive a license
under this part.
(d) Annual certification.--The chief executive officer, or
other appropriate individual, of each applicant for a terminal
operator license, manufacturer license or supplier license, or
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manufacturer licensee, supplier licensee or terminal operator
licensee, shall annually certify under oath to the board and the
Department of State that the applicant or supplier licensee,
manufacturer licensee or terminal operator licensee has
developed and implemented internal safeguards and policies
intended to prevent a violation of this provision and that the
applicant or supplier licensee, manufacturer licensee or
terminal operator licensee has conducted a good faith
investigation that has not revealed a violation of this
subsection during the past year.
(e) Penalties.--
(1) A violation of this section by a terminal operator
licensee or a person that holds a controlling interest in the
license, or a subsidiary company thereof, or an officer,
director or management-level employee of the licensee shall
be punishable as follows:
(i) A first violation of this section shall be
punishable by a fine equal to an amount not less than the
average single-day gross terminal revenue of the terminal
operator licensee.
(ii) A second violation of this section, within five
years of the first violation, shall be punishable by at
least a one-day suspension of the license held by the
terminal operator licensee and a fine equal to an amount
not less than two times the average single-day gross
terminal revenue of the terminal operator licensee.
(iii) A third violation of this section within five
years of the second violation shall be punishable by the
immediate revocation of the license held by the terminal
operator licensee.
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(2) A violation of this section by a manufacturer or
supplier licensed under this part or by a person that holds a
controlling interest in such manufacturer or supplier, or a
subsidiary company thereof, or an officer, a director or
management-level employee of such a licensee shall be
punishable as follows:
(i) A first violation of this section shall be
punishable by a fine equal to an amount not less than a
single-day average of the gross profit from sales made by
the manufacturer or supplier in this Commonwealth during
the preceding 12-month period or portion thereof in the
event the manufacturer or supplier has not operated in
this Commonwealth for 12 months.
(ii) A second or subsequent violation of this
section within five years of a prior violation shall be
punishable by a one-month suspension of the license held
by the manufacturer or supplier and a fine equal to an
amount not less than two times a single-day average of
the gross profit from sales made by the manufacturer or
supplier in this Commonwealth during the preceding 12-
month period or portion thereof in the event the
manufacturer or supplier has not operated in this
Commonwealth for 12 months.
(3) In no event shall the fine imposed under this
section be an amount less than $100,000 for each violation.
In addition to a fine or sanction that may be imposed by the
board under this subsection, an individual who makes a
contribution in violation of this section commits a
misdemeanor of the third degree.
(d) Definitions.--As used in this section, the following
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words and phrases shall have the meanings given to them in this
subsection:
"Contribution." A payment, gift, subscription, assessment,
contract, payment for services, dues, loan, forbearance, advance
or deposit of money or a valuable thing made to a candidate or
political committee for the purpose of influencing an election
in this Commonwealth or for paying debts incurred by or for a
candidate or committee before or after an election. The term
includes:
(1) The purchase of tickets for events, including
dinners, luncheons, rallies and other fundraising events.
(2) The granting of discounts or rebates not available
to the general public.
(3) The granting of discounts or rebates by television
and radio stations and newspapers not extended on an equal
basis to all candidates for the same office.
(4) A payment provided for the benefit of a candidate,
including payment for the services of a person serving as an
agent of a candidate or committee by a person other than the
candidate or committee or person whose expenditures the
candidate or committee must report.
(5) The receipt or use of anything of value by a
political committee from another political committee and a
return on investments by a political committee.
"Political committee." A committee, club, association or
other group of persons that receives contributions or makes
expenditures.
CHAPTER 45
MISCELLANEOUS PROVISIONS
Sec.
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4501. Gaming schools.
4502. Declaration of exemption from Federal laws prohibiting
video gaming terminals.
4503. Preemption of local taxes and license fees.
4504. Exclusive jurisdiction of Supreme Court.
4505. Funding.
§ 4501. Gaming schools.
(a) Curriculum.--The Department of Labor and Industry, in
consultation with the Department of Education and the board,
shall, within 60 days following the effective date of this
section, develop curriculum guidelines, including minimum
proficiency requirements established by the board, for gaming
school instruction related to video gaming terminals. The
guidelines shall, at a minimum, establish courses of instruction
that will provide individuals with adequate job training
necessary to obtain employment as video gaming employees.
(b) Gaming equipment.--All gaming equipment utilized by a
gaming school, including video gaming and associated equipment
and all representations of value, shall be used for training,
instructional and practice purposes only. The use of the gaming
equipment for actual gaming by a person is prohibited.
(c) Possession, removal and transport of equipment.--No
gaming school shall possess, remove or transport, or cause to be
removed or transported, a video gaming terminal or associated
equipment except in accordance with this part.
(d) Serial numbers.--Each video gaming terminal and
associated equipment on the premises of a gaming school shall
have permanently affixed on it a serial number that, together
with the location of the video gaming terminal, is filed with
the board.
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(e) Security.--Each gaming school shall provide adequate
security for video gaming terminals and associated equipment on
the gaming school premises.
(f) Notice to board and bureau.--No gaming school shall sell
or transfer a video gaming terminal or associated equipment
except upon prior written notice to the board and the bureau.
§ 4502. Declaration of exemption from Federal laws prohibiting
video gaming terminals.
(a) Declaration.--Under the Gambling Devices Transportation
Act (64 Stat. 1134, 15 U.S.C. § 1171 et seq.), the Commonwealth
declares that it is exempt from section 2 of that act.
(b) Legal shipments.--All shipments of gambling devices, as
defined in section 1 of the Gambling Devices Transportation Act,
into this Commonwealth, the registering, recording and labeling
of which has been effected by the manufacturer and supplier of
those devices in accordance with sections 3 and 4 of the
Gambling Devices Transportation Act, shall be deemed legal
shipments of gambling devices into this Commonwealth.
§ 4503. Preemption of local taxes and license fees.
(a) Statutes.--Video gaming terminals shall be exempt from
taxes levied under the following:
(1) The act of August 5, 1932 (Sp.Sess., P.L.45, No.45),
referred to as the Sterling Act.
(2) The act of December 31, 1965 (P.L.1257, No.511),
known as The Local Tax Enabling Act.
(3) 53 Pa.C.S. Pt. III Subpt. E (relating to home rule
and optional plan government).
(4) Any statute that confers taxing authority to a
political subdivision.
(b) Licensing fees.--Video gaming terminals are exempt from
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local licensing fees.
§ 4504. Exclusive jurisdiction of Supreme Court.
The Pennsylvania Supreme Court shall have exclusive
jurisdiction to hear a challenge to or to render a declaratory
judgment concerning the constitutionality of this part. The
Pennsylvania Supreme Court may take such action as it deems
appropriate, consistent with the Pennsylvania Supreme Court
retaining jurisdiction over the matter, to find facts or to
expedite a final judgment in connection with a challenge or
request for declaratory relief.
§ 4505. Funding.
(a) Appropriation.--The General Assembly appropriates the
following:
(1) The sum of $5,000,000 is hereby appropriated to the
board for the fiscal period July 1, 2017, to June 30, 2018,
to implement and administer the provisions of this part.
(2) The sum of $3,000,000 is hereby appropriated from
the General Fund to the department for the fiscal period July
1, 2017, to June 30, 2018, to prepare for, implement and
administer the provisions of this part.
(3) The sum of $2,000,000 is hereby appropriated from
the General Fund to the Pennsylvania State Police for the
fiscal period July 1, 2017, to June 30, 2018, to prepare for,
implement and administer the provisions of this part.
(b) Repayment required.--The money appropriated under this
section shall be repaid to the General Fund from the Video
Gaming Fund according to a schedule adopted by the board under
subsection (c).
(c) Repayment schedule.--
(1) The board shall assess terminal operator licensees
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for payment to the Video Gaming Fund in an aggregate amount
equal to the appropriations under subsection (a) beginning
two years from the date the board authorizes the first video
gaming terminal to be connected to the central control
computer system and is made available for public use.
(2) The board shall adopt a repayment schedule that
assesses to each terminal licensee the amount that is
proportional to each terminal operator licensee's gross
terminal revenue.
(3) The repayment schedule adopted by the board shall
require payments made under this section to be repaid to the
General Fund no later than July 1, 2022.
(d) Unused amounts.--On July 1, 2018, any portion of amounts
appropriated under this section that are unexpended,
unencumbered or uncommitted as of June 30 of the prior fiscal
year shall automatically be transferred to the General Fund.
Section 9. Section 5513 of Title 18 is amended to read:
§ 5513. Gambling devices, gambling, etc.
(a) Offense defined.--[A] Except as otherwise provided for
in subsections (a.1) and (a.2), a person is guilty of a
misdemeanor of the first degree if he:
(1) intentionally or knowingly makes, assembles, sets
up, maintains, sells, lends, leases, gives away, or offers
for sale, loan, lease or gift, any punch board, drawing
card[, slot machine] or any device to be used for gambling
purposes, except playing cards;
(2) allows persons to collect and assemble for the
purpose of unlawful gambling at any place under his control;
(3) solicits or invites any person to visit any unlawful
gambling place for the purpose of gambling; or
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(4) being the owner, tenant, lessee or occupant of any
premises, knowingly permits or suffers the same, or any part
thereof, to be used for the purpose of unlawful gambling.
(a.1) Electronic video monitor.--A person commits a
[misdemeanor of the first] felony of the third degree if he
owns, operates, maintains, places into operation or has a
financial interest in an electronic video monitor or business
that owns, operates, maintains or places into operation or has a
financial interest in an electronic video monitor:
(1) which is offered or made available to persons to
play or participate in a simulated gambling program for
direct or indirect consideration, including consideration
associated with a related product, service or activity; and
(2) for which the person playing the simulated gambling
program may become eligible for a cash or cash-equivalent
prize, whether or not the eligibility for or value of the
cash or cash-equivalent prize is determined by or has any
relationship to the outcome of or play of the simulated
gambling program.
(a.2) Gaming machine.--A person commits a felony of the
third degree if he owns, operates, maintains, places into
operation or has a financial interest in a gaming machine or
business that owns, operates, maintains or places into
operation or has a financial interest in a gaming machine.
(b) Confiscation of gambling devices.--Any gambling device
or gaming machine possessed or used in violation of the
provisions of [subsection (a)] subsections (a), (a.1) and (a.2)
of this section shall be seized and forfeited to the
Commonwealth. All provisions of law relating to the seizure,
summary and judicial forfeiture, and condemnation of
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intoxicating liquor shall apply to seizures and forfeitures
under the provisions of this section.
(c) Antique slot machines.--
(1) [A slot machine shall be established as an] An
antique slot machine shall not be considered a gaming machine
or an illegal gambling device if the defendant shows by a
preponderance of the evidence that it was manufactured at
least 25 years before the current year and that it was not
used or attempted to be used for any unlawful purposes.
Notwithstanding subsection (b), no antique slot machine
seized from any defendant shall be destroyed or otherwise
altered until the defendant is given an opportunity to
establish that the slot machine is an antique slot machine.
After a final court determination that the slot machine is an
antique slot machine, the slot machine shall be returned
pursuant to the provisions of law providing for the return of
property; otherwise, the slot machine shall be destroyed.
(2) It is the purpose of this subsection to protect the
collection and restoration of antique slot machines not
presently utilized for gambling purposes.
(d) Shipbuilding business.--Notwithstanding any other
provisions of this section, a person may construct, deliver,
convert or repair a vessel that is equipped with gambling
devices if all of the following conditions are satisfied:
(1) The work performed on the vessel is ordered by a
customer who uses or possesses the vessel outside of this
Commonwealth in a locality where the use or possession of the
gambling devices on the vessel is lawful.
(2) The work performed on the vessel that is equipped
with gambling devices is performed at a shipbuilding or
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repair yard located within a port facility under the
jurisdiction of any port authority organized under the act of
December 6, 1972 (P.L.1392, No.298), known as the Third Class
City Port Authority Act.
(3) The person provides the Office of Attorney General,
prior to the importation of the gambling devices into this
Commonwealth, records that account for the gambling devices,
including the identification number affixed to each gambling
device by the manufacturer, and that identify the location
where the gambling devices will be stored prior to the
installation of the gambling devices on the vessel.
(4) The person stores the gambling devices at a secured
location and permits any person authorized to enforce the
gambling laws to inspect the location where the gambling
devices are stored and records relating to the storage of the
gambling devices.
(5) If the person removes used gambling devices from a
vessel, the person shall provide the Office of Attorney
General of Pennsylvania with an inventory of the used
gambling devices prior to their removal from the vessel. The
inventory shall include the identification number affixed to
each gambling device by the manufacturer.
(6) The person submits documentation to the Office of
Attorney General of Pennsylvania no later than 30 days after
the date of delivery that the vessel equipped with gambling
devices has been delivered to the customer who ordered the
work performed on the vessel.
(7) The person does not sell a gambling device to any
other person except to a customer who shall use or possess
the gambling device outside of this Commonwealth in a
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locality where the use or possession of the gambling device
is lawful. If a person sells a gambling device to such a
customer, the person shall submit documentation to the Office
of Attorney General of Pennsylvania no later than 30 days
after the date of delivery that the gambling device has been
delivered to the customer.
(e) Penalty.--Any person who fails to provide records as
provided in subsection (d) commits a summary offense.
(e.1) Construction.--Nothing in this section shall be
construed to prohibit any activity that is lawfully conducted
under any of the following:
(1) The act of August 26, 1971 (P.L.351, No.91), known
as the State Lottery Law.
(2) The act of July 10, 1981 (P.L.214, No.67), known as
the Bingo Law.
(3) The act of December 19, 1988 (P.L.1262, No.156),
known as the Local Option Small Games of Chance Act.
(4) 4 Pa.C.S. (relating to amusements).
(f) Definitions.--The following words and phrases when used
in this section shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Coin-operated amusement game." A machine that requires the
insertion of a coin, currency or token to play or activate a
game, the outcome of which is predominantly and primarily
determined by the skill of the player.
"Consideration associated with a related product, service or
activity." Money or other value collected for a product,
service or activity which is offered in any direct or indirect
relationship to playing or participating in the simulated
gambling program. The term includes consideration paid for
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computer time, Internet time, telephone calling cards and a
sweepstakes entry.
"Electronic video monitor." An electronic device capable of
showing moving or still images.
"Gaming machine." An electronic or mechanical device or game
that directly or indirectly requires consideration to play, has
the outcome of play determined primarily by chance and rewards a
player cash, prize or anything of value. The term includes a
video gaming terminal as defined in 4 Pa.C.S. § 3102 (relating
to definitions) that does not contain an irremovable
identification plate as specified in 4 Pa.C.S. § 3701 (relating
to testing and certification of terminals).
"Simulated gambling program." Any method intended to be used
by a person interacting with an electronic video monitor in a
business establishment that directly or indirectly implements
the predetermination of sweepstakes cash or cash-equivalent
prizes or otherwise connects the sweepstakes player or
participant with the cash or cash-equivalent prize.
Section 10. No person may be charged with a violation of 18
Pa.C.S. § 5513 involving a gambling device or gaming machine if
the person surrenders the gambling device or gaming machine to
the Pennsylvania State Police within 60 days of the effective
date of this section.
Section 11. Repeals are as follows:
(1) The General Assembly finds that the repeal under
paragraph (2) is necessary to effectuate the amendment of 4
Pa.C.S. § 1307(a).
(2) Section 21(2) of the act of January 1, 2010 (P.L.1,
No.1), is repealed.
Section 12. This act shall take effect immediately.
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