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TABLE OF CONTENTS

 

TITLE 4

AMUSEMENTS

 

PART I.  AMUSEMENTS GENERALLY

 

Chapter 1.  Preliminary Provisions (Reserved)

 

Chapter 3.  Fantasy Contests

 

Subchapter A.  General Provisions

 

§ 301.  Scope of chapter.

§ 302.  Definitions.

 

Subchapter B.  Administration

 

§ 311.  General and specific powers of board.

§ 312.  Temporary regulations.

§ 313.  Fantasy contest license appeals.

§ 314.  Board minutes and records.

§ 315.  Reports of board.

 

Subchapter C.  Licensure

 

§ 321.  General prohibition.

§ 322.  Application.

§ 323.  Issuance and denial of license.

§ 324.  License renewal.

§ 325.  Conditions of licensure.

§ 326.  Prohibitions.

§ 327.  Change in ownership or control of licensed operators.

§ 328.  Penalties.

 

Subchapter D.  Fiscal Provisions

 

§ 331.  Fantasy contest tax.

§ 332.  Licensed operator deposits.

§ 333.  Responsibility and authority of department.

§ 334.  Compulsive and problem gambling.

 

Subchapter E.  Miscellaneous Provisions

 

§ 341.  Applicability of other statutes.

§ 341.1. Liability.

§ 342.  Licensed gaming entities.

 

Chapter 5.  Lottery

 

§ 501.  Scope of chapter.

§ 502.  Definitions.

§ 503.  iLottery authorization.

§ 504.  Retail Incentive Program.

§ 505.  Lottery Sales Advisory Council.

 

PART II.  GAMING

 

Chapter 11.  General Provisions

 

§ 1101.  Short title of part.

§ 1102.  Legislative intent.

§ 1103.  Definitions.

 

Chapter 12.  Pennsylvania Gaming Control Board

 

§ 1201.  Pennsylvania Gaming Control Board established.

§ 1201.1. Applicability of other statutes.

§ 1202.  General and specific powers.

§ 1202.1. Code of conduct.

§ 1202.2. Expenses of regulatory agencies.

§ 1203.  Temporary regulations.

§ 1204.  Licensed gaming entity application appeals from board.

§ 1205.  License or permit application hearing process; public input hearings.

§ 1206.  Board minutes and records.

§ 1207.  Regulatory authority of board.

§ 1208.  Collection of fees and fines.

§ 1209.  Slot machine license fee.

§ 1210.  Number of slot machines.

§ 1211.  Reports of board.

§ 1212.  Diversity goals of board.

§ 1213.  License or permit prohibition.

§ 1214.  Specific authority to suspend slot machine license.

 

Chapter 13.  Licensees

 

§ 1301.  Authorized slot machine licenses.

§ 1302.  Category 1 slot machine license.

§ 1303.  Additional Category 1 slot machine license requirements.

§ 1304.  Category 2 slot machine license.

§ 1305.  Category 3 slot machine license.

§ 1305.1. Category 4 slot machine license.

§ 1305.2. Conduct of auctions.

§ 1306.  Order of initial license issuance.

§ 1307.  Number of slot machine licenses.

§ 1308.  Applications for license or permit.

§ 1309.  Slot machine license application.

§ 1310.  Slot machine license application character requirements.

§ 1311.  Additional slot machine license requirements.

§ 1311.1. Licensing of principals.

§ 1311.2. Licensing of key employees.

§ 1312.  Divestiture of disqualifying applicant.

§ 1313.  Slot machine license application financial fitness requirements.

§ 1314.  Alternative Category 1 licensing standards.

§ 1315.  Conditional Category 1 licenses.

§ 1316.  Bond for issuance of slot machine license.

§ 1317.  Supplier licenses.

§ 1317.1. Manufacturer licenses.

§ 1317.2. Gaming service provider.

§ 1317.3. Nongaming service provider.

§ 1318.  Occupation permit application.

§ 1319.  Alternative manufacturer licensing standards.

§ 1319.1. Alternative supplier licensing standards.

§ 1320.  Slot machine testing and certification standards.

§ 1321.  Additional licenses and permits and approval of agreements.

§ 1322.  Slot machine accounting controls and audits.

§ 1323.  Central control computer system.

§ 1324.  Protocol information.

§ 1325.  License or permit issuance.

§ 1326.  Renewals.

§ 1326.1. Slot machine license operation fee.

§ 1327.  Nontransferability of licenses.

§ 1328.  Change in ownership or control of slot machine licensee.

§ 1329.  Portability and relocation of slot machine license.

§ 1330.  Multiple slot machine license prohibition (Repealed).

§ 1331.  Duty of licensees, key employees and gaming employees.

§ 1332.  Appointment of trustee.

 

Chapter 13A.  Table Games

 

Subchapter A.  General Provisions

 

§ 13A01.  (Reserved).

§ 13A02.  Regulatory authority.

§ 13A03.  Temporary table game regulations.

§ 13A04.  Commonwealth resident employment goals.

 

Subchapter B.  Table Games Authorized

 

§ 13A11.  Authorization to conduct table games.

§ 13A12.  Petition requirements.

§ 13A13.  Prohibitions.

§ 13A14.  Table game authorization hearing process; public input                          hearings.

§ 13A15.  Standard for review of petitions.

§ 13A16.  Award of certificate.

§ 13A16.1. Amendment of statement of conditions.

§ 13A17.  Table game operation certificate.

§ 13A18.  Timing of initial table game authorizations.

 

Subchapter C.  Conduct of Table Games

 

§ 13A21.  Authorized locations for operation.

§ 13A22.  Commencement of table game operations.

§ 13A22.1. Table game tournaments.

§ 13A23.  Training of employees and potential employees.

§ 13A23.1. Training equipment.

§ 13A24.  Condition of continued operation.

§ 13A25.  Table game accounting controls and audit protocols.

§ 13A26.  Cash equivalents.

§ 13A27.  Other financial transactions.

§ 13A28.  Key employees and occupation permits.

§ 13A29.  Application of Clean Indoor Air Act.

§ 13A29.1. Application of Liquor Code.

 

Subchapter D.  (Reserved)

 

Subchapter E.  Table Game Testing and Certification

 

§ 13A41.  Table game device and associated equipment testing and certification standards.

 

Subchapter F.  (Reserved)

 

Subchapter G.  Table Game Taxes and Fees

 

§ 13A61.  Table game authorization fee.

§ 13A62.  Table game taxes.

§ 13A63.  Local share assessment.

 

Chapter 13B.  Interactive Gaming

 

Subchapter A.  General Provisions

 

§ 13B01.  (Reserved).

§ 13B02.  Regulatory authority.

§ 13B03.  Regulations.

 

Subchapter B.  Interactive Gaming Authorized

 

§ 13B11.  Authorization to conduct interactive gaming.

§ 13B12.  Interactive gaming certificate required and content of petition.

§ 13B13.  Issuance of interactive gaming certificate.

§ 13B14.  Interactive gaming operators.

§ 13B15.  Interactive gaming certificate and interactive gaming license.

§ 13B16.  Timing of initial interactive gaming authorizations.

 

Subchapter B.1.  Multi-use Computing Devices

 

§ 13B20.  Authorization.

§ 13B20.1. (Reserved).

§ 13B20.2. (Reserved).

§ 13B20.3. Fee.

§ 13B20.4. Multi-use gaming device tax.

§ 13B20.5. Multi-use gaming device local share assessment.

§ 13B20.6. Regulations.

§ 13B20.7. Construction.

 

Subchapter C.  Conduct of Interactive Gaming

 

§ 13B21.  Situs of interactive gaming operations.

§ 13B22.  Establishment of interactive gaming accounts.

§ 13B23.  Interactive gaming account credits, debits, deposits and payments.

§ 13B24.  Acceptance of wagers.

§ 13B25.  Dormant interactive gaming accounts.

§ 13B26.  Log-in procedure required.

§ 13B27.  Information provided at login.

§ 13B28.  Prohibitions.

§ 13B29.  Commencement of interactive gaming operations.

 

Subchapter D.  Facilities and Equipment

 

§ 13B31.  Responsibilities of interactive gaming certificate holder.

§ 13B32.  Internal, administrative and accounting controls.

 

Subchapter E.  Testing and Certification

 

§ 13B41.  Interactive games and interactive gaming devices and associated equipment testing and certification standards.

 

Subchapter F.  Taxes and Fees

 

§ 13B51.  Interactive gaming authorization fee.

§ 13B52.  Interactive gaming tax.

§ 13B53.  Local share assessment.

§ 13B54.  Compulsive and problem gambling.

§ 13B55.  Certificate holder deposits.

 

Subchapter G.  Miscellaneous Provisions

 

§ 13B61.  Participation in interactive gaming outside Commonwealth.

§ 13B62.  Institutional investors.

§ 13B63.  Internet cafes and prohibition.

 

Chapter 13C.  Sports Wagering

 

Subchapter A.  General Provisions

 

§ 13C01.  Definitions.

§ 13C02.  Regulatory authority.

§ 13C03.  Temporary sports wagering regulations.

§ 13C04.  Unauthorized sports wagering.

 

Subchapter B.  Sports Wagering Authorized

 

§ 13C11.  Authorization to conduct sports wagering.

§ 13C12.  Petition requirements.

§ 13C13.  Standard for review of petitions.

§ 13C14.  Award of certificate.

§ 13C15.  Sports wagering certificate.

§ 13C16.  Sports wagering by manufacturers.

 

Subchapter C.  Conduct of Sports Wagering

 

§ 13C21.  Authorized locations for operation.

§ 13C22.  Commencement of sports wagering operations.

§ 13C23.  Condition of continued operation.

§ 13C24.  Principals, key employees and occupation permits.

§ 13C25.  Application of Clean Indoor Air Act.

§ 13C26.  Application of Liquor Code.

 

Subchapter D.  Sports Wagering Taxes and Fees

 

§ 13C61.  Sports wagering authorization fee.

§ 13C62.  Sports wagering tax.

§ 13C63.  Local share assessment.

§ 13C64.  Compulsive and problem gambling.

 

Subchapter E.  Miscellaneous Provisions

 

§ 13C71.  Criminal activity.

 

Chapter 13D.  (Reserved)

 

Chapter 13E.  (Reserved)

 

Chapter 13F.  Casino Simulcasting

 

Subchapter A.  General Provisions

 

§ 13F01.  Legislative intent and purpose.

§ 13F02.  Definitions.

 

Subchapter B.  Casino Simulcasting Authorized

 

§ 13F05.  Authorization to conduct simulcasting.

§ 13F06.  Regulations.

§ 13F07.  Temporary regulations.

§ 13F08.  Simulcast agreements.

 

Subchapter C.  Application and Issuance of Permit and Establishment of Simulcasting Facility

 

§ 13F11.  Application for permit and requirements.

§ 13F12.  Casino simulcasting permit.

§ 13F13.  Casino simulcasting facilities.

§ 13F14.  License, registration or permitting of employees required.

§ 13F15.  Key employees and occupation permits.

 

Subchapter D.  Conduct of Casino Simulcasting

 

§ 13F31.  Conduct of casino simulcasting.

§ 13F32.  Transmission of live races.

§ 13F33.  Accounting controls and audit protocols.

§ 13F34.  Condition of continued operation.

 

Subchapter E.  Fees and Taxes

 

§ 13F41.  Casino simulcasting authorization fee.

§ 13F42.  Retention and distribution of money and pari-mutuel pools.

§ 13F43.  Casino simulcasting taxes.

§ 13F44.  Construction.

 

Chapter 14.  Revenues

 

§ 1401.  Slot machine licensee deposits.

§ 1402.  Gross terminal revenue deductions.

§ 1402.1. Itemized budget reporting.

§ 1403.  Establishment of State Gaming Fund and net slot machine revenue distribution.

§ 1404.  Distributions from licensee's revenue receipts.

§ 1405.  Pennsylvania Race Horse Development Trust Fund.

§ 1405.1. Protection of funds.

§ 1406.  Distributions from Pennsylvania Race Horse Development Trust Fund.

§ 1407.  Pennsylvania Gaming Economic Development and Tourism Fund.

§ 1407.1.  Casino Marketing and Capital Development Account.

§ 1408.  Transfers from State Gaming Fund.

§ 1409.  Property Tax Relief Fund.

 

Chapter 15.  Administration and Enforcement

 

§ 1501.  Responsibility and authority of department.

§ 1502.  Liens and suits for taxes.

§ 1503.  Applicants to provide tax information.

§ 1504.  Wagering on credit.

§ 1505.  No eminent domain authority.

§ 1506.  Licensed facility zoning and land use appeals.

§ 1507.  Inapplicability of Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act.

§ 1508.  Athletic event gaming.

§ 1509.  Compulsive and problem gambling program.

§ 1509.1. Drug and alcohol treatment.

§ 1510.  Labor hiring preferences.

§ 1511.  Declaration of exemption from Federal laws prohibiting slot machines.

§ 1512.  Financial and employment interests.

§ 1512.1. Additional restrictions.

§ 1513.  Political influence.

§ 1514.  Regulation requiring exclusion, ejection or denial of access of certain persons.

§ 1515.  Repeat offenders excludable from licensed gaming facility.

§ 1516.  List of persons self excluded from gaming activities.

§ 1516.1. Prosecutorial and adjudicatory functions.

§ 1517.  Investigations and enforcement.

§ 1517.1. (Reserved).

§ 1517.2. Conduct of board employees.

§ 1518.  Prohibited acts; penalties.

§ 1518.1. Report of suspicious transactions.

§ 1518.2. Additional authority.

§ 1518.3. Applicability of Clean Indoor Air Act.

§ 1519.  Detention.

§ 1520.  Automated teller machines.

§ 1521.  Liquor licenses at licensed facilities.

§ 1522.  Interception of oral communications.

§ 1523.  Electronic funds transfer terminals.

 

Chapter 16.  Junkets

 

§ 1601.  Gaming junkets authorized.

§ 1602.  Gaming junket enterprise license.

§ 1603.  Classification system.

§ 1604.  Gaming junket representatives.

§ 1605.  Junket agreements.

§ 1606.  Conduct of junket.

§ 1607.  Violation of terms.

§ 1608.  Records.

§ 1609.  Report.

§ 1610.  Gaming junket arrangement.

§ 1611.  Prohibitions.

 

Chapter 17.  Gaming Schools

 

§ 1701.  Curriculum.

§ 1701.1. (Reserved).

§ 1702.  Gaming school gaming equipment.

 

 

Chapter 18.  Fingerprinting

 

§ 1801.  Duty to provide.

§ 1802.  Submission of fingerprints and photographs.

§ 1803.  Commission exemption.

§ 1804.  Board exemption.

§ 1805.  Reimbursement.

 

Chapter 19.  Miscellaneous Provisions

 

§ 1901.  Appropriations.

§ 1901.1. Repayments to General Fund.

§ 1901.2. Commonwealth Financing Authority.

§ 1901.3. Adverse litigation.

§ 1902.  Severability.

§ 1903.  Repeals.

§ 1904.  Exclusive jurisdiction of Supreme Court.

 

PART III.  VIDEO GAMING

 

Chapter 31.  General Provisions

 

§ 3101.  Scope of part.

§ 3102.  Definitions.

 

Chapter 33.  Administration

 

§ 3301.  Powers of board.

§ 3302.  Regulatory authority of board.

§ 3303.  Temporary regulations.

§ 3304.  Appeals.

§ 3305.  Records and confidentiality of information.

§ 3306.  Reporting.

§ 3307.  Diversity.

§ 3308.  Authority of department.

§ 3309.  Central control computer system.

§ 3310.  Department of Drug and Alcohol Programs or successor agency.

 

Chapter 35.  Application and Licensure

 

§ 3501.  General prohibition.

§ 3502.  Terminal operator licenses.

§ 3503.  (Reserved).

§ 3504.  Principal licenses.

§ 3505.  Key employee licenses.

§ 3506.  Divestiture of disqualifying applicant.

§ 3507.  Supplier licenses.

§ 3508.  Manufacturer licenses.

§ 3509.  Gaming service provider.

§ 3510.  Occupation permit.

§ 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.

 

Chapter 37.  Operation

 

§ 3701.  Testing and certification of terminals.

§ 3702.  Video gaming limitations.

§ 3703.  (Reserved).

§ 3704.  Terminal placement agreements.

§ 3705.  Duties of licensees.

§ 3706.  Compulsive and problem gambling.

 

Chapter 39.  Enforcement

 

§ 3901.  Exclusion or ejection of certain persons.

§ 3902.  Repeat offenders.

§ 3903.  Self-exclusion.

§ 3904.  Investigations and enforcement.

§ 3905.  Prohibited acts and penalties.

§ 3906.  Report of suspicious transactions.

§ 3907.  Additional authority.

§ 3908.  Detention.

 

Chapter 41.  Revenues

 

§ 4101.  Fees.

§ 4102.  Taxes and assessments.

§ 4103.  Distribution of local share.

§ 4104.  Regulatory assessments.

§ 4105.  Transfers from Video Gaming Fund.

 

Chapter 43.  Ethics

 

§ 4301.  Board code of conduct.

§ 4302.  Additional board restrictions.

§ 4303.  Financial and employment interests.

§ 4304.  Additional restrictions.

§ 4305.  Political influence.

 

Chapter 45.  Miscellaneous Provisions

 

§ 4501.  (Reserved).

§ 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.  Commonwealth Financing Authority.

§ 4506.  Host county option.

04c101h

 

 

TITLE 4

AMUSEMENTS

 

Part

 I.  Amusements Generally

II.  Gaming

  III.  Video Gaming

 

Enactment.  Unless otherwise noted, the provisions of Title 4 were added July 5, 2004, P.L.572, No.71, effective immediately.

 

PART I

AMUSEMENTS GENERALLY

 

Chapter

1.  Preliminary Provisions (Reserved)

3.  Fantasy Contests

5.  Lottery

 

Enactment.  Part I was added October 30, 2017, P.L.419, No.42, effective immediately.

 

 

CHAPTER 1

PRELIMINARY PROVISIONS

(Reserved)

 

Enactment.  Chapter 1 (Reserved) was added October 30, 2017, P.L.419, No.42, effective immediately.

04c301h

 

 

CHAPTER 3

FANTASY CONTESTS

 

Subchapter

A.  General Provisions

B.  Administration

C.  Licensure

D.  Fiscal Provisions

E.  Miscellaneous Provisions

 

Enactment.  Chapter 3 was added October 30, 2017, P.L.419, No.42, effective in 180 days.

Cross References. Chapter 3 is referred to in section 1103 of this title.

 

 

SUBCHAPTER A

GENERAL PROVISIONS

 

Sec.

301.  Scope of chapter.

302.  Definitions.

04c301s

§ 301.  Scope of chapter.

This chapter relates to fantasy contests.

04c302s

§ 302.  Definitions.

The following words and phrases when used in this chapter shall have the meanings given to them in this section unless the context clearly indicates otherwise:

"Applicant."  A person who, on his own behalf or on behalf of another, is applying for permission to engage in any act or activity which is regulated under the provisions of this chapter. If the applicant is a person other than an individual, the board shall determine the associated persons whose qualifications are necessary as a precondition to the licensing of the applicant.

"Beginner."  A participant who has entered fewer than 51 contests offered by a single licensed operator or who does not meet the definition of a highly experienced player.

"Board."  The Pennsylvania Gaming Control Board.

"Bureau."  The Bureau of Investigations and Enforcement of the board.

"Conduct of gaming."  As defined in section 1103 (relating to definitions).

"Controlling interest."  Either of the following:

(1)  For a publicly traded domestic or foreign corporation, partnership, limited liability company or other form of publicly traded legal entity, a controlling interest is an interest if a person's sole voting rights under State law or corporate articles or bylaws entitle the person to elect or appoint one or more of the members of the board of directors or other governing board or the 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, a controlling interest is the holding of securities of 15% or more in the legal entity, unless this presumption of control is rebutted by clear and convincing evidence.

"Department."  The Department of Revenue of the Commonwealth.

"Entry fee."  The cash or cash equivalent paid by a participant to a licensed operator in order to participate in a fantasy contest.

"Fantasy contest."  As follows:

(1)  An online fantasy or simulated game or contest with an entry fee and a prize or award in which:

(i)  The value of all prizes or awards offered to winning participants is established and made known to participants in advance of the contest and the value is not determined by the number of participants or the amount of any fees paid by those participants.

(ii)  All winning outcomes reflect the relative knowledge and skill of participants and are determined by accumulated statistical results of the performance of individuals, including athletes in the case of sports events.

(iii)  No winning outcome is based on the score, point spread or performance of a single actual team or combination of teams or solely on a single performance of an individual athlete or player in a single actual event.

(2)  The term does not include social fantasy contests.

"Fantasy contest account."  The formal electronic system implemented by a licensed operator to record a participant's entry fees, prizes or awards and other activities related to participation in the licensed operator's fantasy contests.

"Fantasy contest adjusted revenues."  For each fantasy contest, the amount equal to the total amount of all entry fees collected from all participants entering the fantasy contest minus prizes or awards paid to participants in the fantasy contest, multiplied by the in-State percentage.

"Fantasy contest license."  A license issued by the board authorizing a person to offer fantasy contests in this Commonwealth in accordance with this chapter.

"Fantasy contest terminal."  A computerized or electronic terminal or similar device within a licensed facility that allows participants to:

(1)  register for a fantasy contest account;

(2)  pay an entry fee;

(3)  select athletes for a fantasy contest;

(4)  receive winnings; or

(5)  otherwise participate in a fantasy contest.

"Gaming service provider."  As defined in section 1103.

"Highly experienced player."  As follows:

(1)  Any participant who has:

(i)  entered more than 1,000 fantasy contests; or

(ii)  won more than three fantasy contest prizes or awards valued at $1,000 or more.

(2)  Once a participant is classified as a highly experienced player, a player shall remain classified as a highly experienced player.

"In-State participant."  An individual who participates in a fantasy contest conducted by a licensed operator and pays a fee to a licensed operator from a location within this Commonwealth. The term includes an individual who pays an entry fee through a fantasy contest terminal within a licensed facility.

"In-State percentage."  For each fantasy contest, the percentage, rounded to the nearest tenth of a percent, equal to the total entry fees collected from all in-State participants divided by the total entry fees collected from all participants in the fantasy contest.

"Institutional investor."  As defined in section 1103.

"Key employee."  An individual who is employed by an applicant for a fantasy contest license or a licensed operator in a director or department head capacity or who is empowered to make discretionary decisions that regulate fantasy contest operations as determined by the board.

"Licensed entity representative."  A person, including an attorney, agent or lobbyist, acting on behalf of or authorized to represent the interest of an applicant, licensee or other person authorized by the board to engage in an act or activity which is regulated under this chapter regarding a matter before, or which may be reasonably be expected to come before, the board.

"Licensed facility."  As defined in section 1103.

"Licensed gaming entity."  As defined in section 1103.

"Licensed operator."  A person who holds a fantasy contest license.

"Licensee."  A licensed operator, a principal or key employee of a licensed operator.

"Participant."  An individual who participates in a fantasy contest, whether the individual is located in this Commonwealth or another jurisdiction.

"Person."  A natural person, corporation, publicly traded corporation, foundation, organization, business trust, estate, limited liability company, licensed corporation, trust, partnership, limited liability partnership, association or any other form of legal business entity.

"Principal."  An officer, director or person who directly holds a beneficial interest in or ownership of the securities of an applicant for a fantasy contest license or a licensed operator, a person who has a controlling interest in an applicant for a fantasy contest license or a licensed operator or who has the ability to elect a majority of the board of directors of a licensed operator or to otherwise control a licensed operator, lender or other licensed financial institution of an applicant for a fantasy contest license or a licensed operator, 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 for a fantasy contest license or a licensed operator or other person or employee of an applicant for a fantasy contest license or a licensed operator deemed to be a principal by the board.

"Prize or award."  Anything of value worth $100 or more or any amount of cash or cash equivalents.

"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 (54 Stat. 789, 15 U.S.C. § 80a-1 et seq.); or

(3)  is subject to the reporting requirements under 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.).

"Script."  A list of commands that a fantasy-contest-related computer software program can execute that is created by a participant or third party not approved by the licensed operator to automate processes on a licensed operator's fantasy contest platform.

"Season-long fantasy contest."  A fantasy contest offered by a licensed operator that is conducted over an entire sports season.

"Social fantasy contest."  A fantasy contest which meets one or more of the following criteria:

(1)  Nothing is offered to participants other than game-based virtual currency that cannot be redeemed for cash, merchandise or anything of value outside the context of game play.

(2)  The contest is free to all participants.

(3)  The entity offering the contest receives no compensation, other than an administrative fee for the maintenance of statistical information, in connection with the contest.

(4)  The winnings offered are of no greater value than the lowest individual fee charged to a single participant for entering or participating in the contest.

(5)  The contest encompasses an entire season of the activity in which the underlying competition is being conducted and the winnings offered, if any, are determined by agreement of the participants only in order to distribute fully the participants' contributions to a fund established to grant the winnings for the contest.

"Suspicious transaction."  A transaction between a licensed operator or an employee of a licensed operator and an individual that involves the acceptance or redemption by a person of cash or cash equivalent involving or aggregating $5,000 or more which a licensed operator or employee of a licensed operator knows, suspects or has reason to believe:

(1)  involves funds derived from illegal activities or is intended or conducted in order to conceal or disguise funds or assets derived from illegal activities;

(2)  is part of a plan to violate or evade a law or regulation to avoid a transaction reporting requirement under the laws or regulations of the United States or this Commonwealth, including a plan to structure a series of transactions to avoid a transaction reporting requirement under the laws of the United States or this Commonwealth; or

(3)  has no apparent lawful purpose or is not the type of transaction in which a person would normally be expected to engage and the licensed operator or employee knows of no reasonable explanation for the transaction after examining the available facts, including the background and possible purpose of the transaction.

04c311h

 

 

SUBCHAPTER B

ADMINISTRATION

 

Sec.

311.  General and specific powers of board.

312.  Temporary regulations.

313.  Fantasy contest license appeals.

314.  Board minutes and records.

315.  Reports of board.

04c311s

§ 311.  General and specific powers of board.

(a)  General powers.--

(1)  The board shall have general and sole regulatory authority over the conduct of fantasy contests and related activities as described in this chapter. The board shall ensure the integrity of fantasy contests offered in this Commonwealth.

(2)  The board may employ individuals as necessary to carry out the requirements of this chapter, who shall serve at the board's pleasure. An employee of the board shall be considered a State employee for purposes of 71 Pa.C.S. Pt. XXV (relating to retirement for State employees and officers).

(b)  Specific powers.--The board shall have the following specific powers:

(1)  At the board's discretion, to issue, approve, renew, revoke, suspend, condition or deny issuance of licenses under this chapter.

(2)  At the board's discretion, to suspend, condition or deny the issuance or renewal of a license or levy fines for any violation of this chapter.

(3)  To publish each January on the board's publicly accessible Internet website a complete list of all persons who applied for or held a fantasy contest license at any time during the preceding calendar year and the status of the application or fantasy contest license.

(4)  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 332 (relating to licensed operator deposits) required to meet the obligations under this chapter accruing during the period beginning July 1 of the following fiscal year.

(5)  In the event that, in any year, appropriations for the administration of this chapter are not enacted by June 30, any funds appropriated for the administration of this chapter which are unexpended, uncommitted and unencumbered at the end of a fiscal year shall remain available for expenditure by the board until the enactment of appropriation for the ensuing fiscal year.

(6)  To promulgate rules and regulations necessary for the administration and enforcement of this chapter. Except as provided in section 312 (relating to temporary regulations), regulations shall be adopted under 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.

(7)  To administer oaths, examine witnesses and issue subpoenas compelling the attendance of witnesses or the production of documents and records or other evidence or to designate officers or employees to perform duties required by this chapter.

(7.1)  To require prospective and existing employees, independent contractors, applicants and licensees to submit to fingerprinting by the Pennsylvania State Police or an authorized agent of the Pennsylvania State Police. The Pennsylvania State Police or authorized agent of the Pennsylvania State Police shall submit the fingerprints to the Federal Bureau of Investigation for purposes or verifying the identity of the individual and obtaining records of criminal arrests and convictions.

(7.2)  To require prospective and existing employees, independent contractors, applicants and licensees to submit photographs consistent with the standards established by the board.

(7.3)  To require licensed operators to maintain an office or place of business within this Commonwealth.

(7.4)  To exempt certain prospective and existing employees or independent contractors from the requirements under paragraphs (7.1) and (7.2) that are not inconsistent with the proper regulation of fantasy contests under this chapter.

(8)  At the board's discretion, to delegate any of the board's responsibilities under this chapter to the executive director of the board or other designated staff.

(9)  To require licensed operators and applicants for a fantasy contest license to submit any information or documentation necessary to ensure the proper regulation of fantasy contests in accordance with this chapter.

(10)  To require licensed operators, except for a licensed operator operating season-long fantasy contests that generate less than $250,000 in season-long fantasy contest adjusted revenue, unless the board determines otherwise, to:

(i)  contract with a certified public accountant to conduct an annual independent audit in accordance with standards adopted by the American Institute of Certified Public Accountants to verify compliance with the provisions of this chapter and board regulations;

(ii)  contract with a testing laboratory approved by the board to annually verify compliance with the provisions of this chapter and board regulations; and

(iii)  annually submit to the board and department a copy of the audit report required by subparagraph (i) and submit to the board a copy of the report of the testing laboratory required by subparagraph (ii).

(11)  In conjunction with the Department of Drug and Alcohol Programs or successor agency, to develop a process by which licensed operators provide participants with a toll-free telephone number that provides individuals with information on how to access appropriate treatment services.

(12)  To promulgate regulations regarding the placement and operation of fantasy contest terminals within licensed facilities and to ensure the integrity of fantasy contest terminals.

(b.1)  Licensed entity representative.--

(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 operator, applicant for licensure or other person being represented.

(2)  A licensed entity representative shall have an affirmative duty to update its registration information on an ongoing basis. Failure to update a registration shall be punishable by the board.

(3)  The board shall maintain a list of licensed entity representatives which shall contain the information required under paragraph (1) and shall be available on the board's publicly accessible Internet website.

(c)  Exceptions.--Except as provided under section 342 (relating to licensed gaming entities), nothing in this section shall be construed to authorize the board to require any additional permits or licenses not specifically enumerated in this chapter.

04c312s

§ 312.  Temporary regulations.

(a)  Promulgation.--In order to facilitate the prompt implementation of this chapter, regulations promulgated by the board shall be deemed temporary regulations and shall expire no later than two years following the publication of temporary regulations. The board may promulgate temporary regulations not subject to:

(1)  Sections 201, 202, 203, 204 and 205 of the act of July 31, 1968 (P.L.769, No.240), referred to as the Commonwealth Documents Law.

(2)  Section 204(b) of the act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act.

(3)  The act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act.

(b)  Expiration.--Except for temporary regulations concerning network connectivity, security and testing and compulsive and problem play, the authority provided to the board to adopt temporary regulations in subsection (a) shall expire no later than two years following the publication of temporary regulations. Regulations adopted after this period shall be promulgated as provided by law.

04c312v

 

Cross References.  Section 312 is referred to in sections 311, 333 of this title.

04c313s

§ 313.  Fantasy contest license appeals.

An applicant may appeal any final order, determination or decision of the board involving the approval, issuance, denial, revocation or conditioning of a fantasy contest license 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).

04c314s

§ 314.  Board minutes and records.

(a)  Record of proceedings.--The board shall maintain a record of all proceedings held at public meetings of the board. The verbatim transcript of the proceedings shall be the property of the board and shall be prepared by the board upon the request of any person and the payment by that person of the costs of preparation.

(b)  Applicant information.--

(1)  The board shall maintain a list of all applicants for a fantasy contest license. The list shall include a record of all actions taken with respect to each applicant. The list shall be available on the board's publicly accessible Internet website.

(2)  Information under paragraph (1) regarding an applicant whose fantasy contest license has been denied, revoked or not renewed shall be removed from the list after seven years from the date of the action.

(c)  Other files and records.--The board shall maintain such other files and records as it may deem appropriate.

(d)  Confidentiality of information.--

(1)  The following information submitted by an applicant for a fantasy contest license under section 322 (relating to application) or otherwise 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)  All 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.

(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.

(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 that may include customer-identifying information or customer prospects for services subject to competition.

(iv)  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.

(v)  Records of an applicant for a fantasy contest license or a licensed operator 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).

(vi)  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).

(vii)  Financial or security information deemed confidential by the board upon a showing of good cause by the applicant for a fantasy contest license or licensed operator.

(2)  Except as provided in paragraph (1), no claim of confidentiality shall be made regarding any criminal history record information that is available to the public under 18 Pa.C.S. § 9121(b) (relating to general regulations).

(3)  Except as provided in paragraph (1), no claim of confidentiality shall be made regarding a record in possession of the board that is otherwise publicly available from the board under the act of February 14, 2008 (P.L.6, No.3), known as the Right-to-Know Law.

(4)  The information made confidential under this section shall be withheld from public disclosure, in whole or in part, except that any 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 such release is requested by an applicant for a fantasy contest license or licensed operator and does not otherwise contain confidential information about another person.

(5)  The board may seek a voluntary waiver of confidentiality from an applicant for a fantasy contest license or a licensed operator, but may not require an applicant or licensed operator to waive any confidentiality provided for in this subsection as a condition for the approval of an application, renewal of a fantasy contest license or any other action of the board.

(e)  Notice.--Notice of the contents of any information, except to a duly authorized law enforcement agency under this section, shall be given to an applicant or licensee in a manner prescribed by the rules and regulations adopted by the board.

(f)  Information held by department.--Files, records, reports and other information in the possession of the department pertaining to licensed operators or applicants shall be made available to the board as may be necessary for the effective administration of this chapter.

04c315s

§ 315.  Reports of board.

(a)  General rule.--The annual report submitted by the board under section 1211 (relating to reports of board) shall include the following information on the conduct of fantasy contests:

(1)  Total fantasy contest adjusted revenues.

(2)  All taxes, fees, fines and other revenue collected from licensed operators during the previous year. The department shall collaborate with the board to carry out the requirements of this section.

(3)  At the board's discretion, any other information related to the conduct of fantasy contests or licensed operators.

(b)  Licensed operators.--The board may require licensed operators to provide information to the board to assist in the preparation of the report.

04c321h

 

 

SUBCHAPTER C

LICENSURE

 

Sec.

321.  General prohibition.

322.  Application.

323.  Issuance and denial of license.

324.  License renewal.

325.  Conditions of licensure.

326.  Prohibitions.

327.  Change in ownership or control of licensed operators.

328.  Penalties.

04c321s

§ 321.  General prohibition.

(a)  General rule.--Except as provided in subsection (b), no person may offer or otherwise make available for play in this Commonwealth a fantasy contest without a fantasy contest license.

(b)  Existing activity.--A person who applies for or renews a fantasy contest license in accordance with this chapter may operate during the application or renewal period unless:

(1)  The board has reasonable cause to believe the person or licensed operator is or may be in violation of the provisions of this chapter.

(2)  The board requires the person to suspend the operation of a fantasy contest until the fantasy contest license is issued or renewed.

04c322s

§ 322.  Application.

(a)  Form and information.--An application for a fantasy contest license shall be submitted on a form and in manner as shall be required by the board. An application for a fantasy contest license shall contain the following information:

(1)  (i)  if the applicant is an individual, the name, Federal employer identification number and business address of the applicant;

(ii)  if the applicant is a corporation, the name and business address of the corporation, the state of its incorporation and the full name and business address of each officer and director thereof;

(iii)  if the applicant is a foreign corporation, the name and business address of the corporation, whether it is qualified to do business in this Commonwealth and the full name and business address of each officer and director thereof; and

(iv)  if the applicant is a partnership or joint venture, the name and business address of each officer thereof.

(2)  The name and business address of the person having custody of the applicant's financial records.

(3)  The names and business addresses of the applicant's key employees.

(4)  The names and business addresses of each of the applicant's principals.

(5)  Information, documentation and assurances related to financial and criminal history as the board deems necessary to establish by clear and convincing evidence the financial stability, integrity and responsibility of the applicant and the applicant's key employees and principals.

(6)  Information and documentation necessary to establish the applicant's ability to comply with section 325 (relating to conditions of licensure).

(7)  Any other information required by the board.

(b)  Nonrefundable application fee.--Each application submitted under this chapter shall be accompanied by a nonrefundable application fee, which shall be established by the board, and which may not exceed the amount necessary to reimburse the board for all costs incurred by the board for fulfilling the requirements of this section and section 323 (relating to issuance and denial of license).

(c)  Additional information.--A person applying for a fantasy contest license shall have an ongoing duty to provide information required by the board and to cooperate in any inquiry or investigation.

(d)  Abbreviated application process.--The board, at its discretion, may establish an abbreviated application process for a fantasy contest license for applicants that are also licensed gaming entities. The abbreviated application may only require information not in possession of the board that is necessary to fulfill the requirements of this chapter.

04c322v

 

Cross References.  Section 322 is referred to in sections 314, 323, 327 of this title.

04c323s

§ 323.  Issuance and denial of license.

(a)  Duty to review applications.--The board shall review all applications for a fantasy contest license and may issue a license to any applicant that:

(1)  Has submitted a completed application and paid the nonrefundable application fee as required by the board under section 322 (relating to application).

(2)  Has demonstrated that the applicant has the financial stability, integrity and responsibility to comply with the provisions of this chapter and regulations established by the board.

(3)  Has not been denied an application for a fantasy contest license under subsection (b).

(b)  Reasons to deny applications.--The board may deny an application for a fantasy contest license if the applicant:

(1)  has knowingly made a false statement of material fact in the application or has deliberately failed to disclose any information requested;

(2)  employs a principal or key employee who has been convicted in any jurisdiction of any of the following:

(i)  a felony;

(ii)  an offense under the laws of another jurisdiction which, if committed in this Commonwealth, would be subject to imprisonment for more than five years; or

(iii)  a misdemeanor gambling offense, unless 15 years have elapsed from the date of conviction for the offense.

(3)  has at any time knowingly failed to comply with the provisions of this chapter or of any requirements of the board;

(4)  has had a registration, permit or license to conduct fantasy contests denied or revoked in any other jurisdiction;

(5)  has legally defaulted in the payment of any obligation or debt due to the Commonwealth or is not compliant with taxes due;

(6)  is not qualified to do business in this Commonwealth or is not subject to the jurisdiction of the courts of the Commonwealth; or

(7)  is found by the board to be unsuitable for licensure or inimicable to the interest of the Commonwealth to offer fantasy contests in this Commonwealth.

(c)  Time period for review.--The board shall conclude its review of an application for a fantasy contest license within 120 days of receipt of the completed application. If the fantasy contest license is not issued, the board shall provide the applicant with the justification for not issuing the fantasy contest license.

(d)  License fee.--

(1)  Within 30 days of the board issuing a fantasy contest license, a successful applicant shall pay to the board a license fee of $50,000.

(2)  The license fee collected under this subsection shall be deposited into the General Fund.

(3)  If a licensed operator fails to pay the fee required by this subsection, the board shall suspend or revoke the licensed operator's fantasy contest license until payment of the license fee is received.

(e)  Abbreviated approval process.--The board, at its discretion, may establish an abbreviated approval process for the issuance of a fantasy contest license to a licensed gaming entity whose slot machine license under Chapter 13 (relating to licensees) and table game operation certificate under Chapter 13A (relating to table games) are in good standing.

04c323v

 

Cross References.  Section 323 is referred to in sections 322, 327 of this title.

04c324s

§ 324.  License renewal.

(a)  Renewal.--

(1)  A fantasy contest license issued under this chapter shall be valid for a period of five years.

(2)  Nothing in this subsection shall be construed to relieve a licensed operator of the affirmative duty to notify the board of any changes relating to the status of its fantasy contest license or to any other information contained in the application materials on file with the board.

(3)  The application for renewal of a fantasy contest license must be submitted at least 180 days prior to the expiration of the fantasy contest license and include an update of the information contained in the initial application for a fantasy contest license. A fantasy contest license for which a completed renewal application and fee as required under subsection (c) has been received by the board shall continue in effect unless and until the board sends written notification to the licensed operator that the board has denied the renewal of the fantasy contest license.

(b)  Revocation or failure to renew.--

(1)  In addition to any other sanction the board may impose under this chapter, the board may at its discretion suspend, revoke or deny renewal of a fantasy contest license issued under this chapter if it receives information that:

(i)  the licensed operator or the licensed operator's key employees or principals are in violation of any provision of this chapter;

(ii)  the licensed operator has furnished the board with false or misleading information;

(iii)  the information contained in the licensed operator's initial application or any renewal application is no longer true and correct;

(iv)  the licensed operator has failed to remit taxes or assessments required under section 331 (relating to fantasy contest tax), 332 (relating to licensed operator deposits) or 333 (relating to responsibility and authority of department); or

(v)  the licensed operator has legally defaulted in the payment of any obligation or debt due to the Commonwealth.

(2)  In the event of a revocation or failure to renew, the licensed operator's authorization to conduct fantasy contests shall immediately cease and all fees paid in connection with the application shall be deemed to be forfeited.

(3)  In the event of a suspension, the licensed operator's authorization to conduct fantasy contests shall immediately cease until the board has notified the licensed operator that the suspension is no longer in effect.

(c)  Renewal fee.--

(1)  Within 30 days of the board renewing a fantasy contest license, the licensed operator shall pay to the board a renewal fee of $10,000.

(2)  The renewal fee collected by the board under this subsection shall be deposited into the General Fund.

(3)  If a licensed operator fails to pay the renewal fee required under this subsection, the board shall suspend or revoke the licensed operator's fantasy contest license until payment of the renewal fee is received.

04c325s

§ 325.  Conditions of licensure.

As a condition of licensure, the board shall require each licensed operator to establish and implement procedures to govern the conduct of fantasy contests in this Commonwealth. The procedures, at a minimum, shall:

(1)  Permit only participants who have established a fantasy contest account with the licensed operator to participate in a fantasy contest conducted by the licensed operator.

(2)  Verify the age, location and identity of any participant prior to making a deposit into a fantasy contest account for a participant located in this Commonwealth according to regulations established by the board. No participant under 18 years of age may be permitted to establish a fantasy contest account with a licensed operator.

(3)  Verify the identity of a participant by requiring the participant to provide the licensed operator a unique user name and password prior to accessing a fantasy contest account.

(4)  Ensure rules and prizes and awards established by the licensed operator for a fantasy contest are made known to a participant prior to the acceptance of any entry fee and prize and award values are not determined by the number of participants nor the amount of any fees paid by those participants.

(4.1)  Develop and offer fantasy contests that are limited to beginners as follows:

(i)  Except as provided in subparagraph (ii), a licensed operator shall prohibit participants who are not beginners from participating, directly or through another person as a proxy, in beginner fantasy contests.

(ii)  A licensed operator may allow a participant who is not a beginner to enter up to 10 beginner fantasy contests in any sport in which that participant has not already entered 20 fantasy contests.

(iii)  A licensed operator shall suspend the account of a participant who is not a beginner, except as provided for in subparagraph (ii), that enters a beginner fantasy contest and shall ban the participant from further participation in beginner fantasy contests offered by the licensed operator.

(4.2)  Develop and offer fantasy contests in which highly experienced players cannot, either directly or through another person as a proxy, participate. A licensed operator shall suspend the account of any highly experienced player who enters a fantasy contest which excludes highly experienced players, directly or through another person as a proxy, and shall ban the individual from further participation in fantasy contests offered by the licensed operator.

(4.3)  Establish a procedure for receiving and responding to participant complaints and reconciling a participant's fantasy contest account. The licensed operator shall forward to the board on a quarterly basis a copy of each complaint received.

(4.4)  Submit, in the manner as the board requires, a description of the licensed operator's administrative and accounting procedures in detail, including its written system of internal control. Each written system of internal control shall include:

(i)  An organizational chart depicting appropriate segregation of employee functions and responsibilities.

(ii)  A description of the duties and responsibilities of each employee position shown on the organizational chart.

(iii)  A detailed narrative description of the administrative and accounting procedures designed to satisfy the requirements of this section.

(iv)  Record retention policy.

(v)  A statement signed by the chief financial officer of the proposed licensed operator or other competent person and the chief executive officer of the proposed licensed operator or other competent person attesting that the officers believe, in good faith, that the system satisfies the requirements of this section.

(vi)  Any other item that the board may require in its discretion.

(4.5)  File a report of any suspicious transaction with the bureau. The following shall apply:

(i)  A licensed operator or a person acting on behalf of a licensed operator who knowingly fails to file a report of a suspicious transaction commits a misdemeanor of the third degree.

(ii)  A licensed operator or a person acting on behalf of a licensed operator who fails to file a report or a person who causes another person required under this section to fail to file a report of a suspicious transaction shall be strictly liable for his actions and may be subject to sanctions as determined by the board.

(iii)  The bureau shall maintain a record of all reports made under this paragraph for a period of five years. The bureau shall make the reports available to any Federal or State law enforcement agency without necessity of subpoena.

(iv)  A person who is required to file a report of a suspicious transaction shall not notify an individual suspected of committing the suspicious transaction that the transaction has been reported. A person that violates this subsection commits a misdemeanor of the third degree and may be subject to sanctions as determined by the board.

(v)  A person who is required to file a report of a suspicious transaction who 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 suspicious.

(5)  Ensure that an individual who is the subject of a fantasy contest is restricted from entering as a participant in a fantasy contest that is determined, in whole or part, on the accumulated statistical results of a team of individuals in the sport in which the individual is a member.

(6)  Allow a person to restrict himself from entering a fantasy contest or accessing a fantasy contest account for a specific period of time as determined by the participant and implement procedures to prevent the person from participating in the licensed operator's fantasy contests. The following shall apply to self-exclusions:

(i)  A person may request placement on the list of self-excluded persons and agree that, during any period of voluntary exclusion, the person may not collect any winnings nor recover any losses resulting from any fantasy contest activity.

(ii)  Notwithstanding any other law to the contrary, the board's list of self-excluded persons shall not be open to public inspection. Nothing in this section shall be construed to prohibit a licensed operator from disclosing the identity of persons self-excluded under this paragraph to affiliated licensed gaming entities or licensed operators in this Commonwealth or other jurisdictions for the limited purpose of assisting in the proper administration of responsible programs operated by affiliated licensed gaming entities or licensed operators.

(7)  Allow a person to restrict the total amount of deposits that the participant may pay to the licensed operator for a specific time period established by the participant and implement procedures to prevent the participant from exceeding the limit.

(8)  Conspicuously post compulsive and problem play notices at fantasy contest registration points and provide the toll-free telephone number to participants. The toll-free telephone number and the compulsive and problem play notice shall be approved by the board, in consultation with the Department of Drug and Alcohol Programs or a successor agency.

(9)  Disclose the number of entries a single participant may submit to each fantasy contest and take steps to prevent such participants from submitting more than the allowable number.

(10)  Prohibit the licensed operator's principals, employees and relatives living in the same household of an employee or principal from competing in a fantasy contest offered by any licensed operator to the general public and in which fantasy contest the licensed operator offers a prize or award.

(11)  Prevent the sharing of confidential information that could affect fantasy contest play with third parties until the information is made publicly available.

(12)  Take steps to maintain the confidentiality of a participant's personal and financial information.

(13)  Segregate participant funds from operational funds in separate accounts and maintain a reserve in the form of cash, cash equivalents, security deposits held by banks and processors, an irrevocable letter of credit, payment processor reserves and receivables, a bond or a combination thereof in an amount sufficient to pay all prizes and awards offered to winning participants. To satisfy this paragraph, a licensed operator that only offers season-long fantasy contests that generate less than $250,000 in season-long fantasy contest adjusted revenue may contract with a third party to hold prizes and awards in an escrow account until after the season is concluded and prizes and awards are distributed.

(14)  Provide winning in-State participants with information and documentation necessary to ensure the proper reporting of winnings by in-State participants to the department.

(15)  Remit taxes or assessments to the department in accordance with sections 331 (relating to fantasy contest tax), 332 (relating to licensed operator deposits) and 333 (relating to responsibility and authority of department).

(16)  Prohibit the use of scripts by participants and implement technologies to prevent the use of scripts.

(17)  Monitor fantasy contests for the use of scripts and prohibit participants found to have used such scripts from participation in future fantasy contests.

(18)  Establish any other condition deemed appropriate by the board.

04c325v

 

Cross References.  Section 325 is referred to in section 322 of this title.

04c326s

§ 326.  Prohibitions.

(a)  General rule.--No licensed operator may:

(1)  accept an entry fee from or permit a natural person under 18 years of age to become a participant in a fantasy contest;

(2)  offer a fantasy contest based, in whole or in part, on collegiate or high school athletic events or players;

(3)  permit a participant to enter a fantasy contest prior to establishing a fantasy contest account, unless the licensed operator is also a licensed gaming entity and the participant enters a fantasy contest through a fantasy contest terminal located within the licensed gaming entity's licensed facility;

(4)  establish a fantasy contest account for a person who is not an individual;

(5)  alter rules established for a fantasy contest after a participant has entered the fantasy contest;

(6)  issue credit to a participant to establish or fund a fantasy contest account;

(7)  knowingly market to a participant during the time period in which the participant has self-excluded from the licensed operator's fantasy contests;

(8)  knowingly permit a participant to enter the licensed operator's fantasy contests during the time period in which the participant has self-excluded from the licensed operators' fantasy contests;

(8.1)  knowingly allow a self-excluded person to keep a prize or award.

(9)  knowingly accept a deposit in excess of a limit established by a participant for the specific time period established by the participant;

(10)  share confidential information that could affect fantasy contest play with third parties until the information is made publicly available;

(11)  knowingly permit a principal, an employee of a licensed operator or a relative living in the same household of an employee or principal of a licensed operator to become a participant in a fantasy contest offered by any licensed operator in which a licensed operator offers a prize or award;

(12)  offer a fantasy contest where:

(i)  the value of all prizes or awards offered to winning participants is not established and made known to participants in advance of the fantasy contest;

(ii)  the value of the prize or award is determined by the number of participants or the amount of any fees paid by those participants;

(iii)  the winning outcome does not reflect the relative knowledge and skill of participants;

(iv)  the winning outcome is based on the score, point spread or performance of a single actual team or combination of teams or solely on a single performance of an individual athlete or player in a single actual event; or

(v)  the winning outcome is not based on statistical results accumulated from fully completed athletic sports contests or events, except that participants may be credited for statistical results accumulated in a suspended or shortened sports event which has been partially completed on account of weather or other natural or unforeseen event;

(13)  fail to remit taxes or assessments to the department in accordance with sections 331 (relating to fantasy contest tax), 332 (relating to licensed operator deposits) and 333 (relating to responsibility and authority of department);

(14)  knowingly allow a participant to use a script during a fantasy contest;

(15)  except as permitted under section 342 (relating to licensed gaming entities), offer or make available in this Commonwealth a fantasy contest terminal; and

(16)  perform any other action prohibited by the board.

(b)  Deposit.--The licensed operator shall forward the amount of the prize or award under subsection (a)(8.1) to the board which shall transfer the amount to the State Treasurer for deposit in the General Fund.

04c327s

§ 327.  Change in ownership or control of licensed operators.

(a)  Notification and approval.--

(1)  A licensed operator shall notify the board upon becoming aware of any proposed change of ownership of the licensed operator by a person or group of persons acting in concert which involves any of the following:

(i)  More than 15% of a licensed operator's securities or other ownership interests.

(ii)  The sale, other than in the ordinary course of business, of a licensed operator's assets.

(iii)  Any other transaction or occurrence deemed by the board to be relevant to fantasy contest license qualifications.

(2)  Notwithstanding the provisions of paragraph (1), a licensed operator shall not be required to notify the board of any 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 such securities were purchased for investment purposes only and the institutional investor files with the board a certified statement to the effect that the institutional investor has no intention of influencing or affecting, directly or indirectly, the affairs of the licensed operator. However, the institutional investor may vote on matters put to the vote of the outstanding security holders. Notice to the board shall be required prior to completion of any proposed or contemplated change of ownership of a licensed operator that meets the criteria of this section.

(b)  Qualification of purchaser and change of control.--

(1)  A purchaser of the assets, other than in the ordinary course of business, of a licensed operator shall independently qualify for a fantasy contest license in accordance with this chapter and shall pay the application fee and license fee as required by sections 322 (relating to application) and 323 (relating to issuance and denial of license), except that if the purchaser of assets is another licensed operator, the purchaser of assets shall not be required to requalify for a fantasy contest license or pay another application fee and license fee.

(2)  A change in control of any licensed operator shall require that the licensed operator independently qualify for a fantasy contest license in accordance with this chapter, and the licensed operator shall pay a new application and license fee as required by sections 322 and 323, except that if the new controller is another licensed operator, the new controller shall not be required to requalify for a fantasy contest license or pay another application fee and license fee.

(c)  License revocation.--Failure to comply with this section may cause the fantasy contest license issued under this chapter 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 application or license fee has been paid.

(d)  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:

"Change in control of a licensed operator."  The acquisition by a person or group of persons acting in concert of more than 20% of a licensed operator'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 fantasy contest 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 licensed operator.

04c328s

§ 328.  Penalties.

(a)  Suspension or revocation of license.--After a public hearing with at least 15 days' notice, the board may suspend or revoke a licensed operator's fantasy contest license in any case where a violation of this chapter has been shown by a preponderance of the evidence.

(b)  Administrative penalties.--

(1)  In addition to suspension or revocation of a fantasy contest license, the board may impose administrative penalties on a licensed operator for violations of this chapter.

(2)  A violation of this chapter 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.

(3)  The licensed operator shall have the right to appeal administrative penalties 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).

(4)  Penalties imposed under this subsection shall be deposited into the General Fund.

(c)  Civil penalties.--

(1)  In addition to the provisions of this section, a person who knowingly violates a provision of this chapter shall be liable for a civil penalty of not more than $1,000 for each such violation.

(2)  The civil penalty shall be recovered in a civil action brought by the board and shall be paid into the General Fund.

04c331h

 

 

SUBCHAPTER D

FISCAL PROVISIONS

 

Sec.

331.  Fantasy contest tax.

332.  Licensed operator deposits.

333.  Responsibility and authority of department.

334.  Compulsive and problem gambling.

04c331s

§ 331.  Fantasy contest tax.

(a)  Imposition.--Each licensed operator shall report to the department and pay from its monthly fantasy contest adjusted revenues, on a form and in the manner prescribed by the department, a tax of 15% of its monthly fantasy contest adjusted revenues.

(b)  Deposits and distributions.--

(1)  The tax imposed under subsection (a) shall be payable to the department on a monthly basis and shall be based upon monthly fantasy contest adjusted revenue derived during the previous month.

(2)  All funds owed to the Commonwealth under this section shall be held in trust for the Commonwealth by the licensed operator until the funds are paid to the department.

(3)  The tax imposed and collected by the department under subsection (a) shall be deposited into the General Fund.

(c)  Penalty.--

(1)  A licensed operator who fails to timely remit to the department the tax imposed under this section shall be liable, in addition to any sanction or penalty imposed under this chapter, for the payment of 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.

(2)  Penalties imposed and collected by the department or the board under this subsection shall be deposited into the General Fund.

04c331v

 

Cross References.  Section 331 is referred to in sections 324, 325, 326, 333, 334 of this title.

04c332s

§ 332.  Licensed operator deposits.

(a)  Accounts established.--The State Treasurer shall establish within the State Treasury an account for each licensed operator for the deposits required under subsection (b) to recover costs or expenses incurred by the board and the department in carrying out their powers and duties under this chapter based upon a budget submitted by the board and the department under subsection (c).

(b)  Deposits.--

(1)  The department shall determine the appropriate assessment amount for each licensed operator, which shall be a percentage assessed by the department on the licensed operator's fantasy contest adjusted revenues. Each licensed operator shall deposit funds into its account on a monthly basis.

(2)  The percentage assessed by the department shall not exceed an amount necessary to recover costs or expenses incurred by the board and the department in carrying out their powers and duties under this chapter based on a budget submitted by the board and the department under subsection (c).

(c)  Itemized budget reporting.--

(1)  The board and the department shall prepare and annually submit to the chairperson and minority chairperson of the Appropriations Committee of the Senate and the chairperson and minority 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 chapter.

(2)  The itemized budget required under paragraph (1) shall be submitted in conjunction with the budget required to be submitted under section 1202(b)(28) (relating to general and specific powers).

(d)  Appropriation.--Costs and expenses from accounts established under subsection (a) shall only be disbursed upon appropriation by the General Assembly.

(e)  Penalty.--

(1)  A licensed operator who fails to timely remit to the department the tax imposed under this section shall be liable, in addition to any sanction or penalty imposed under this chapter, for the payment of 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.

(2)  Penalties imposed and collected by the department under this subsection shall be deposited into the General Fund.

04c332v

 

Cross References.  Section 332 is referred to in sections 311, 324, 325, 326, 333 of this title.

04c333s

§ 333.  Responsibility and authority of department.

(a)  General rule.--The department shall administer and collect taxes imposed under section 331 (relating to fantasy contest tax) and interest imposed under 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 sections 331 and 332 (relating to licensed operator deposits), including the collection of taxes, penalties, assessments and interest.

(b)  Procedure.--For purposes of implementing sections 331 and 332, the department may promulgate regulations in the same manner in which the board is authorized as provided in section 312 (relating to temporary regulations).

04c333v

 

Cross References.  Section 333 is referred to in sections 324, 325, 326 of this title.

04c334s

§ 334.  Compulsive and problem gambling.

Each year, from the tax imposed under section 331, the amount equal to .002 multiplied by the total fantasy contest adjusted revenue of all active and operating licensed operators shall be transferred to the Department of Drug and Alcohol Programs or a successor agency to be used for drug and alcohol addiction treatment services, including treatment for drug and alcohol addiction related to compulsive and problem gambling as provided under section 1509.1 (relating to drug and alcohol treatment).

04c341h

 

 

SUBCHAPTER E

MISCELLANEOUS PROVISIONS

 

Sec.

341.  Applicability of other statutes.

341.1. Liability.

342.  Licensed gaming entities.

04c341s

§ 341.  Applicability of other statutes.

(a)  Unlawful gambling.--The provisions of 18 Pa.C.S. § 5513 (relating to gambling devices, gambling, etc.) shall not apply to a fantasy contest conducted in accordance with this chapter.

(b)  Pool selling and bookmaking.--The provisions of 18 Pa.C.S. § 5514 (relating to pool selling and bookmaking) shall not apply to a fantasy contest conducted in accordance with this chapter.

(c)  Lotteries.--The provisions of 18 Pa.C.S. § 5512 (relating to lotteries, etc.) shall not apply to a fantasy contest conducted in accordance with this chapter.

(d)  State Lottery Law.--This chapter shall not apply to a fantasy contest or similar product authorized under the act of August 26, 1971 (P.L.351, No.91), known as the State Lottery Law, and authorized solely by the department and the Division of the State Lottery or iLottery under Chapter 5 (relating to lottery).

04c341.1s

§ 341.1.  Liability.

A licensed operator or employee of a licensed operator shall not be liable to any self-excluded person or to any other party in any judicial proceeding for any harm, monetary or otherwise, which may arise as a result of:

(1)  the failure of a licensed operator to withhold fantasy contest privileges from or restore fantasy contest privileges to a self-excluded person; or

(2)  otherwise permitting or not permitting a self- excluded person to engage in fantasy contest activity while on the list of self-excluded persons.

04c342s

§ 342.  Licensed gaming entities.

(a)  Scope.--This section shall apply to a licensed gaming entity that holds a fantasy contest license.

(b)  Applicability.--Nothing in this chapter shall be construed to limit the board's general and sole regulatory authority over the conduct of gaming or related activities under Part II (relating to gaming), including, but not limited to, the certification, registration and regulation of gaming service providers and individuals and entities associated with a gaming service provider.

(c)  Restricted contests.--A licensed gaming entity may offer restricted fantasy contests that are exclusive to participants who are at least 21 years of age.

(d)  Promotional play.--For a restricted fantasy contest under subsection (c), a licensed gaming entity may offer slot machine promotional play or table game match play to a participant who is at least 21 years of age as a prize or award or for participating in a fantasy contest conducted by the licensed gaming entity.

(e)  Gaming service providers.--A licensed operator who is not a licensed gaming entity may, at the discretion of the board, be certificated or registered as a gaming service provider under section 1317.2 (relating to gaming service provider) in order to operate fantasy contests subject to the requirements of this section.

(f)  Fantasy contest terminals.--

(1)  A licensed gaming entity may petition the board, on a form and in a manner as required by the board, to place and operate fantasy contest terminals within the licensed gaming entity's licensed facility.

(2)  The board may, according to regulations adopted by the board, approve the placement and operation of fantasy contest terminals at one or more locations within a licensed facility, provided that fantasy contest terminals may not be placed on the gaming floor.

(3)  The board may not require a participant to establish a fantasy contest account prior to entering a fantasy contest through a fantasy contest terminal.

04c342v

 

Cross References.  Section 342 is referred to in sections 311, 326 of this title.

04c501h

 

 

CHAPTER 5

LOTTERY

 

Sec.

501.  Scope of chapter.

502.  Definitions.

503.  iLottery authorization.

504.  Retail Incentive Program.

505.  Lottery Sales Advisory Council.

 

Enactment.  Chapter 5 was added October 30, 2017, P.L.419, No.42, effective immediately.

Cross References.  Chapter 5 is referred to in sections 341, 1103, 13C01 of this title.

04c501s

§ 501.  Scope of chapter.

This chapter relates to lottery.

04c502s

§ 502.  Definitions.

The following words and phrases when used in this chapter shall have the meanings given to them in this section unless the context clearly indicates otherwise:

"Agent" or "lottery sales agent."  A person licensed under section 305 of the State Lottery Law.

"Department."  The Department of Revenue of the Commonwealth.

"iLottery."  A system that provides for the distribution of lottery products through numerous channels that include, but are not limited to, web applications, mobile applications, mobile web, tablets and social media platforms that allow players to interface through a portal for the purpose of obtaining lottery products and ancillary services, such as account management, game purchase, game play and prize redemption.

"iLottery game."  Internet instant games and other lottery products offered through iLottery. The term does not include games that represent physical, Internet-based or monitor-based interactive lottery games which simulate casino-style lottery games, specifically including poker, roulette, slot machines or blackjack.

"Internet instant game."  A lottery game of chance in which, by the use of a computer, tablet computer or other mobile device, a player purchases a lottery play, with the result of play being a reveal on the device of numbers, letters or symbols indicating whether a lottery prize has been won according to an established methodology as provided by the lottery.

"Lottery" or "State Lottery."  The lottery established under the State Lottery Law.

"Lottery products."  Plays, shares or chances offered by the State Lottery as well as lottery property that may be exchanged for plays, shares or chances. The term includes instant tickets, terminal-based tickets, raffle games, play-for-fun games, lottery vouchers, subscription services and gift cards authorized for sale under the State Lottery Law.

"Secretary."  The Secretary of Revenue of the Commonwealth.

"State Lottery Law."  The act of August 26, 1971 (P.L.351, No.91), known as the State Lottery Law.

"Subscription services."  A payment, advance payment or promise of payment for multiple lottery products over a specified period of time, including payment through iLottery.

04c503s

§ 503.  iLottery authorization.

(a)  Authority.--Notwithstanding any provision of law to the contrary, the department may operate iLottery games.

(b)  Temporary regulatory authority.--

(1)  In order to facilitate the prompt implementation of iLottery or new sales methods of traditional lottery products over the Internet, regulations promulgated by the secretary shall be deemed temporary regulations which shall expire not later than two years following the publication of the temporary regulations. The secretary may promulgate temporary regulations not subject to:

(i)  Sections 201, 202, 203, 204 and 205 of the act of July 31, 1968 (P.L.769, No.240), referred to as the Commonwealth Documents Law.

(ii)  Section 204(b) of the act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act.

(iii)  The act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act.

(2)  Regulations adopted after the two-year time period shall be promulgated as provided by law.

(c)  Prompt implementation.--Notwithstanding any other provision of law to the contrary and in order to facilitate the prompt implementation of iLottery in this Commonwealth, initial contracts entered into by the department for iLottery and related gaming systems, including any necessary hardware, software, licenses or related services, shall not be subject to the provisions of 62 Pa.C.S. (relating to procurement). Contracts entered into under this subsection may not exceed two years.

(d)  Player identifiable information.--With the exception of certain information released by the department to notify the public of the identity of a prize recipient or to perform any other obligation of the lottery under laws or regulations related to the payment of lottery prizes, personal identifying information obtained by the department as a result of a player's purchase of lottery products or the claim of a lottery prize, such as name, address, telephone number or player financial information, shall be considered confidential and otherwise exempt from public disclosure whether retained by the department, an agent of the department or a lottery sales agent.

(e)  Lottery confidential proprietary information.--

(1)  Information obtained by the department as a result of a player's purchase of lottery products or entering a lottery drawing, such as aggregate statistical data which may include play history or player tendencies, shall be considered confidential proprietary information of the department and otherwise exempt from public disclosure whether retained by the department, an agent of the lottery or a lottery sales agent.

(2)  Confidential proprietary information shall include any research or study conducted by the lottery or a lottery vendor that utilizes confidential proprietary information obtained under this section.

(f)  Revenues.--

(1)  Notwithstanding any provision of law to the contrary, revenues accruing from the sale of lottery products under this chapter shall be dedicated to and deposited in the State Lottery Fund as provided for in section 311 of the State Lottery Law. The revenues shall be apportioned as provided for in section 303(a)(11) of the State Lottery Law.

(2)  For fiscal years beginning after June 30, 2017, revenues raised under this chapter shall not be subject to the profit margin limitations specified in section 303(a)(11)(iv) of the State Lottery Law.

(g)  iLottery game cards.--iLottery game cards or other similar mechanisms that allow players to prepurchase lottery products offered through iLottery sold by a lottery sales agent shall result in the lottery sales agent receiving a commission on the sale as provided for under the State Lottery Law.

(h)  Restrictions.--

(1)  An iLottery player must be at least 18 years of age to establish an account with the department and must be physically located within the geographical boundaries of this Commonwealth to play iLottery games. A player establishing an account must agree to the terms and conditions presented by the department which must require the player to affirm that the account is limited solely to that player's use for iLottery gaming purposes and that other use is unlawful.

(2)  No iLottery game shall be sold, and no prize shall be awarded, to an officer or employee of the division of State Lottery in the department or a spouse, child, brother, sister or parent residing as a member of the same household in the principal place of abode of the officer or employee.

(i)  Self-exclusion.--The department shall promulgate regulations regarding the establishment of an iLottery self-exclusion program that would allow individuals to voluntarily exclude themselves from iLottery.

04c504s

§ 504.  Retail Incentive Program.

(a)  Establishment.--The department shall establish a Retail Incentive Program to reward lottery sales agents that engage in department-recommended best practices which result in increased lottery sales at the agent's lottery sales location. Consistent with the State Lottery's responsibilities to older Pennsylvanians and the Lottery's commitment to helping agents achieve success in selling lottery products, the Retail Incentive Program shall be designed to generate incremental revenue that exceeds the cost of the program. The program shall be reviewed annually to determine the benefit to older Pennsylvanians and the consistency to the State Lottery's mission.

(b)  Funding.--The department shall fund the program with 0.5% of the sale of traditional lottery products at lottery sales agents' physical lottery sales location within the prior fiscal year. The funds administered under this chapter shall not be counted toward the profit margin limitation under section 303(a)(11)(iv) of the State Lottery Law.

(c)  Notice.--Prior to the commencement of the Retail Incentive Program, and for each year thereafter that the Retail Incentive Program is in effect, the department shall publish a notice in the Pennsylvania Bulletin detailing the Retail Incentive Program for that fiscal year. The notice shall include program goals, requirements and the assessment metrics that will be used for measuring program effectiveness. A modification in the program must be submitted for publication as a notice in the Pennsylvania Bulletin.

(d)  Review.--The notices under subsection (c) shall not be subject to review under any of the following:

(1)  Section 205 of the act of July 31, 1968 (P.L.769, No.240), referred to as the Commonwealth Documents Law.

(2)  Sections 204(b) and 301(10) of the act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act.

(3)  The act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act.

(e)  Contents.--The Retail Incentive Program shall include regular and varied incentives for lottery sales agents to increase sales by a predetermined percentage over a base period, increase State Lottery signage, keep ticket displays stocked, pay winning tickets and actively promote the sale of lottery products.

(f)  Participation.--Participation in the Retail Incentive Program shall be voluntary for lottery sales agents.

(g)  Nonlapse.--Amounts remaining in the Retail Incentive Program at the end of a fiscal year shall not lapse, but shall be used to fund retail sales initiatives, including, but not limited to, new equipment, signage, training, coupons, consumer and agent in-store promotions and sales makeovers, designed to improve in-store merchandising, foot traffic and sales.

04c505s

§ 505.  Lottery Sales Advisory Council.

(a)  Establishment.--

(1)  The department shall establish a Lottery Sales Advisory Council which shall be comprised of the secretary, the Director of the Division of the State Lottery, a representative from the Department of Aging or a successor agency, members of a Statewide food merchants association, lottery sales agents and any other individual, at the discretion of the department.

(2)  The Lottery Sales Advisory Council shall meet at times and in a manner at the department's discretion for the purposes of increasing the partnership between the State Lottery and lottery sales agents and developing policy recommendations for increased lottery sales.

(3)  The Lottery Sales Advisory Council shall operate in an advisory, nonbinding capacity.

(b)  Compensation.--A non-Commonwealth employee member of the Lottery Sales Advisory Council shall not be entitled to any form of compensation from the Commonwealth for the performance of any duty that may be required by the Lottery Sales Advisory Council.

04c1101h

 

 

PART II

GAMING

 

Chapter

  11.  General Provisions

  12.  Pennsylvania Gaming Control Board

  13.  Licensees

  13A. Table Games

  14.  Revenues

  15.  Administration and Enforcement

  16.  Junkets

  17.  Gaming Schools

  18.  Fingerprinting

  19.  Miscellaneous Provisions

 

Enactment.  Part II was added July 5, 2004, P.L.572, No.71, effective immediately.

 

 

CHAPTER 11

GENERAL PROVISIONS

 

Sec.

1101.  Short title of part.

1102.  Legislative intent.

1103.  Definitions.

 

Enactment.  Chapter 11 was added July 5, 2004, P.L.572, No.71, effective immediately.

04c1101s

§ 1101.  Short title of part.

This part shall be known and may be cited as the Pennsylvania Race Horse Development and Gaming Act.

04c1102s

§ 1102.  Legislative intent.

The General Assembly recognizes the following public policy purposes and declares that the following objectives of the Commonwealth are to be served by this part:

(1)  The primary objective of this part to which all other objectives and purposes are secondary is to protect the public through the regulation and policing of all activities involving gaming and practices that continue to be unlawful.

(2)  The authorization of limited gaming by the installation and operation of slot machines as authorized in this part is intended to enhance live horse racing, breeding programs, entertainment and employment in this Commonwealth.

(2.1)  The authorization of table games and interactive gaming in this part is intended to supplement slot machine gaming by increasing revenues to the Commonwealth and providing new employment opportunities by creating skilled jobs for individuals related to the conduct of table games at licensed facilities in this Commonwealth and related to the conduct of interactive gaming.

(3)  The authorization of limited gaming is intended to provide a significant source of new revenue to the Commonwealth to support property tax relief, wage tax reduction, economic development opportunities and other similar initiatives.

(3.1)  The authorization of limited gaming in this Commonwealth impacts this Commonwealth as a whole, including the geographic regions of this Commonwealth where licensed facilities are located. Requiring licensed facilities to make annual payments for the privilege of operating in this Commonwealth's counties and municipalities furthers a legitimate government interest of ensuring benefits to not only the host county and host municipality but the region where the licensed facility is located.

(3.2)  Requiring annual payments to both host counties and host municipalities recognizes that these two separate units of local government have separate governing bodies, different jurisdictions and may face distinct issues related to the authorization of limited gaming within their boundaries. This distinction applies in all regions, except a city and county of the first class, which are governed by one governing body and where the territorial limits of the jurisdictions are identical and unique.

(4)  The authorization of limited gaming is intended to positively assist the Commonwealth's horse racing industry, support programs intended to foster and promote horse breeding and improve the living and working conditions of personnel who work and reside in and around the stable and backside areas of racetracks.

(5)  The authorization of limited gaming is intended to provide broad economic opportunities to the citizens of this Commonwealth and shall be implemented in such a manner as to prevent possible monopolization by establishing reasonable restrictions on the control of multiple licensed gaming facilities in this Commonwealth.

(6)  The authorization of limited gaming is intended to enhance the further development of the tourism market throughout this Commonwealth, including, but not limited to, year-round recreational and tourism locations in this Commonwealth.

(7)  Participation in limited gaming authorized under this part by any licensee, permittee, registrant or certificate holder shall be deemed a privilege, conditioned upon the proper and continued qualification of the licensee, permittee, registrant or certificate holder and upon the discharge of the affirmative responsibility of each licensee, permittee, registrant and certificate holder to provide the regulatory and investigatory authorities of the Commonwealth with assistance and information necessary to assure that the policies declared by this part are achieved.

(8)  Strictly monitored and enforced control over all limited gaming authorized by this part shall be provided through regulation, licensing and appropriate enforcement actions of specified locations, persons, associations, practices, activities, licensees, permittees, registrants and certificate holders.

(9)  Strict financial monitoring and controls shall be established and enforced by all licensees, permittees, registrants and certificate holders.

(10)  The public interest of the citizens of this Commonwealth and the social effect of gaming shall be taken into consideration in any decision or order made pursuant to this part.

(10.1)  The General Assembly has a compelling interest in protecting the integrity of both the electoral process and the legislative process by preventing corruption and the appearance of corruption which may arise through permitting any type of political campaign contributions by certain persons involved in the gaming industry and regulated under this part.

(10.2)  Banning all types of political campaign contributions by certain persons subject to this part is necessary to prevent corruption and the appearance of corruption that may arise when political campaign contributions and gaming regulated under this part are intermingled.

(11)  It is necessary to maintain the integrity of the regulatory control and legislative oversight over the operation and play of slot machines, table games and interactive gaming in this Commonwealth; to ensure the bipartisan administration of this part; and avoid actions that may erode public confidence in the system of representative government.

(12)  It is the intent of the General Assembly to authorize the operation and play of slot machines, table games and interactive gaming under a single slot machine license issued to a slot machine licensee when a slot machine licensee has been issued a table game operation certificate and an interactive gaming certificate under this part.

(12.1)  The continued growth and success of the commercial gaming industry in this Commonwealth is dependent upon a regulatory environment which promotes and fosters technological advances and encourages the development and delivery of innovative gaming products.

(12.2)  It is also the intent of the General Assembly to ensure the sustainability and competitiveness of the commercial gaming industry in this Commonwealth by authorizing interactive gaming, the operation of multistate wide-area progressive slot machines, skill and hybrid slot machines.

(12.3)  It is also the intent of the General Assembly to authorize the operation and play of interactive gaming in conformance with Federal law, including the Unlawful Internet Gambling Enforcement Act of 2006 (Title VIII of Public Law 109-347, 31 U.S.C. §§ 5361-5367).

(12.4)  It is also the intent of the General Assembly to authorize sports wagering when Federal law is enacted or repealed or a Federal court decision is filed that permits a state to regulate sports wagering.

(12.5)  It is further the intent of the General Assembly to:

(i)  Auction Category 4 locations and the right to apply for Category 4 locations in this Commonwealth to ensure the sustainability and competitiveness of the commercial gaming industry.

(ii)  Authorize Category 4 locations in a manner to avoid the cannibalization of existing commercial gaming locations.

(13)  The authorization of limited gaming in this Commonwealth requires the Commonwealth to take steps to increase awareness of compulsive and problem gambling and to develop and implement effective strategies for prevention, assessment and treatment of this behavioral disorder.

(14)  Research indicates that compulsive and problem gambling and drug and alcohol addiction are related. Therefore, the General Assembly intends to establish an approach to compulsive and problem gambling prevention, assessment and treatment that will ensure the provision of adequate resources to identify, assess and treat both compulsive and problem gambling and drug and alcohol addiction.

04c1102v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2010 Amendment.  Act 1 amended par. (11) and added pars. (2.1), (10.1), (10.2), (12), (13) and (14).

04c1103s

§ 1103.  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 that directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with a specified person.

"Airport authority."  Any of the following:

(1)  the governing body of a municipal authority organized and incorporated to oversee the operations of a qualified airport under 53 Pa.C.S. Ch. 56 (relating to municipal authorities); or

(2)  a city of the first class that regulates the use and control of a qualified airport located partially in a county of the first class and partially in a county contiguous to a county of the first class.

"Airport gaming area."  A location or locations within a qualified airport approved by the airport authority and the Pennsylvania Gaming Control Board for the conduct of interactive gaming through the use of multi-use computing devices by eligible passengers.

"Applicant."  Any person who, on his own behalf or on behalf of another, is applying for permission to engage in any act or activity which is regulated under the provisions of this part. In cases in which the applicant is a person other than an individual, the Pennsylvania Gaming Control Board shall determine the associated persons whose qualifications are necessary as a precondition to the licensing of the applicant.

"Approved," "approval" or "approve."  When used in reference to an application submitted to the State Horse Racing Commission or the State Harness Racing Commission to conduct harness or thoroughbred race meetings or the Pennsylvania Gaming Control Board to authorize and regulate the placement and operation of slot machines, the terms refer to the date that an application to the State Horse Racing Commission, State Harness Racing Commission or the board is granted regardless of the pendency of any administrative or judicial appeals or other legal action challenging the decision of either commission or the board.

"Associated equipment."  Any equipment or mechanical, electromechanical or electronic contrivance, component or machine used in connection with slot machines or table games, including linking devices which connect to progressive slot machines and multistate wide-area progressive slot machines or slot machine replacement parts, equipment which affects the proper reporting and counting of gross terminal revenue, gross table game revenue and gross interactive gaming revenue, computerized systems for controlling and monitoring slot machines, table games or interactive games, including, but not limited to, the central control computer to which all slot machines communicate, devices for weighing or counting money and interactive gaming devices necessary for the operation of interactive games as approved by the Pennsylvania Gaming Control Board. The term shall not include count room equipment.

"Auction."  A public meeting of the board to receive and open sealed bids submitted in accordance with section 1305.2 (relating to conduct of auctions).

"Authority."  An authority created by the Commonwealth which purchases State gaming receipts under section 1202 (relating to general and specific powers).

"Authorized interactive game."  An interactive game approved by regulation of the Pennsylvania Gaming Control Board to be suitable for interactive gaming offered by an interactive gaming certificate holder or an interactive gaming operator on behalf of an interactive gaming certificate holder in accordance with Chapter 13B (relating to interactive gaming). The term shall include any interactive game approved by regulation of the Pennsylvania Gaming Control Board to be suitable for interactive gaming through the use of a multi-use computing device.

"Background investigation."  A security, criminal, credit and suitability investigation of a person as provided for in this part. The investigation shall include the status of taxes owed to the United States and to the Commonwealth and its political subdivisions.

"Backside area."  Those areas of the racetrack facility that are not generally accessible to the public and which include, but are not limited to, those facilities commonly referred to as barns, track kitchens, recreation halls, backside employee quarters and training tracks, and roadways providing access thereto. The term does not include those areas of the racetrack facility which are generally accessible to the public, including the various buildings commonly referred to as the grandstand or the racing surfaces, paddock enclosures and walking rings.

"Banking game."  Any table game in which a player competes against a certificate holder rather than against another player.

"Bid."  An offer to pay for the right to select a Category 4 location and apply for a Category 4 slot machine license.

"Board."  The Pennsylvania Gaming Control Board established under section 1201 (relating to Pennsylvania Gaming Control Board established).

"Bonds."  Bonds, notes, instruments, refunding notes and bonds and other evidences of indebtedness or obligations, which an authority issues to fund the purchase of State gaming receipts.

"Bureau."  The Bureau of Investigations and Enforcement of the Pennsylvania Gaming Control Board.

"Cash."  United States currency and coin.

"Cash equivalent."  An asset that is readily convertible to cash, including, but not limited to, any of the following:

(1)  Chips or tokens.

(2)  Travelers checks.

(3)  Foreign currency and coin.

(4)  Certified checks, cashier's checks and money orders.

(5)  Personal checks or drafts.

(6)  A negotiable instrument applied against credit extended by a certificate holder, an interactive gaming certificate holder, an interactive gaming operator or a financial institution.

(6.1)  A prepaid access instrument.

(7)  Any other instrument or representation of value that the Pennsylvania Gaming Control Board deems a cash equivalent.

"Category 4 location."  A specific geographic point established by geographic coordinates in this Commonwealth with a 15-linear mile radius.

"Central control computer."  A central site computer controlled by the Department of Revenue and accessible by the Pennsylvania Gaming Control Board to which all slot machines 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 slot machine, including, but not limited to, coin in, coin out, ticket in, ticket out, jackpots, machine door openings and power failure, and remote machine activation and disabling of slot machines.

"Certificate holder."  A slot machine licensee that holds a table game operation certificate awarded by the Pennsylvania Gaming Control Board in accordance with Chapter 13A (relating to table games).

"Cheat."  To defraud or steal from any player, slot machine licensee or the Commonwealth while operating or playing a slot machine, table game or authorized interactive game, including causing, aiding, abetting or conspiring with another person to do so. The term shall also mean to alter or causing, aiding, abetting or conspiring with another person to alter the elements of chance, method of selection or criteria which determine:

(1)  The result of a slot machine game, table game or authorized interactive game.

(2)  The amount or frequency of payment in a slot machine game, table game or authorized interactive game.

(3)  The value of a wagering instrument.

(4)  The value of a wagering credit.

The term does not include altering a slot machine, table game device or associated equipment or interactive gaming device or associated equipment for maintenance or repair with the approval of a slot machine licensee.

"Cheating or thieving device."  A device, software or hardware used or possessed with the intent to be used to cheat during the operation or play of any slot machine, table game or authorized interactive game. The term shall also include any device used to alter a slot machine, a table game device or associated equipment, an authorized interactive game or interactive gaming device or associated equipment without the slot machine licensee's approval.

"Chip."  A representation of value, including a plaque, issued by a certificate holder for use in playing a table game at the certificate holder's licensed facility and redeemable with the issuing certificate holder for cash or cash equivalent.

"Commission."  The State Horse Racing Commission as defined in 3 Pa.C.S. § 9301 (relating to definitions).

"Communications technology."  Any method used and the components employed to facilitate the transmission and receipt of information, including transmission and reception by systems using wire, wireless, cable, radio, microwave, light, fiber optics, satellite or computer data networks, including the Internet and intranets.

"Compensation."  Any thing 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 that person or another.

"Complimentary service."  Any lodging, service or item which is provided to an individual at no cost or at a reduced cost which 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.

"Concession operator."  A person engaged in the sale or offering for sale of consumer goods or services to the public at a qualified airport, or authorized to conduct other commercial activities related to passenger services at a qualified airport, in accordance with the terms and conditions of an agreement or contract with an airport authority, government entity or other person.

"Conduct of gaming."  The licensed placement, operation and play of slot machines, table games and interactive games and casino simulcasting under this part, as authorized and approved by the Pennsylvania Gaming Control Board. The term shall include the licensed placement, operation and play of authorized interactive games through the use of multi-use computing devices at a qualified airport under Subchapter B.1 of Chapter 13B (relating to multi-use computing devices).

"Contest."  A slot machine, table game or authorized interactive game competition among players for cash, cash equivalents or prizes.

"Controlling interest."  For a publicly traded domestic or foreign corporation, a controlling interest is an 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 or more of the members of the board of directors or other governing board or the 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. For a privately held domestic or foreign corporation, partnership, limited liability company or other form of privately held legal entity, a controlling interest is 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."  Includes a publicly traded corporation.

"Count room."  A secured room at a licensed facility designated for the counting, wrapping and recording of slot machine and table game receipts.

"Counterfeit chip."  Any object or thing that is:

(1)  used or intended to be used to play a table game at a certificate holder's licensed facility and which was not issued by that certificate holder for such use;

(2)  presented to a certificate holder for redemption if the object was not issued by the certificate holder;

(3)  used or intended to be used to play an authorized interactive game which was not approved by the interactive gaming certificate holder for such use; or

(4)  presented during play of an authorized interactive game for redemption, if the object or thing was not issued by the interactive gaming certificate holder or interactive gaming operator.

"Department."  The Department of Revenue of the Commonwealth.

"Electronic gaming table."  A gaming table approved by the Pennsylvania Gaming Control Board that is a mechanical, electrical or computerized contrivance, terminal, machine or other device which, upon insertion or placement of cash or cash equivalents therein or thereon, or upon a wager or payment of any consideration whatsoever, is available for play or operation by one or more players as a table game. The term shall include any gaming table where a wager or payment is made using an electronic or computerized wagering or payment system. The term shall not include a slot machine.

"Eligible passenger."  An individual 21 years of age or older who has cleared security check points with a valid airline boarding pass for travel from one destination to another by airplane.

"Executive-level public employee."  The term shall include the following:

(1)  Deputy Secretaries 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 which 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 shall include an employee with law enforcement authority.

(3)  An employee of a county or municipality with discretionary powers which 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 shall include 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 which 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 shall include an employee with law enforcement authority.

"Financial backer."  An investor, mortgagee, bondholder, noteholder or other sources of equity or capital provided to an applicant or licensed entity.

"Fully automated electronic gaming table."  An electronic gaming table determined by the Pennsylvania Gaming Control Board to be playable or operable as a table game without the assistance or participation of a person acting on behalf of a certificate holder.

"Fund."  The State Gaming Fund established under section 1403 (relating to establishment of State Gaming Fund and net slot machine revenue distribution).

"Gaming employee."  Any employee of a slot machine licensee, including, but not limited to:

(1)  Cashiers.

(2)  Change personnel.

(3)  Count room personnel.

(4)  Slot attendants.

(5)  Hosts or other individuals authorized to extend complimentary services, including employees performing functions similar to those performed by a gaming junket representative.

(6)  Machine mechanics, computer machine technicians or table game device technicians.

(7)  Security personnel.

(8)  Surveillance personnel.

(9)  Promotional play supervisors, credit supervisors, pit supervisors, cashier supervisors, shift supervisors, table game managers and assistant managers and other supervisors and managers, except for those specifically identified in this part as key employees.

(10)  Boxmen.

(11)  Dealers or croupiers.

(12)  Floormen.

(13)  Personnel authorized to issue promotional play.

(14)  Personnel authorized to issue credit.

The term shall include employees of a person holding a supplier's license whose duties are directly involved with the repair or distribution of slot machines, table game devices or associated equipment or interactive gaming devices or associated equipment sold or provided to a licensed facility within this Commonwealth as determined by the Pennsylvania Gaming Control Board. The term shall further include employees of a person authorized by the board to supply goods and services related to interactive gaming or any subcontractor or an employee of a subcontractor that supplies interactive gaming devices, including multi-use computing devices, or associated equipment to an interactive gaming certificate holder or interactive gaming operator who are directly involved in the operations of interactive gaming. The term does not include bartenders, cocktail servers or other persons engaged solely in preparing or serving food or beverages, clerical or secretarial personnel, parking attendants, janitorial, stage, sound and light technicians and other nongaming personnel as determined by the board.

"Gaming floor."  Any portion of a licensed facility where slot machines or table games have been installed for use or play.

"Gaming junket."  A gaming arrangement made by a gaming junket enterprise or a gaming junket representative for an individual who:

(1)  Is selected or approved for participation in the arrangement based on the individual's ability to satisfy specific financial qualifications and the likelihood that the individual will participate in playing slot machines or table games and patronize a licensed facility for the purpose of gaming.

(2)  Receives complimentary services or gifts from a slot machine licensee for participation in the arrangement, including the costs of transportation, food, lodging or entertainment.

"Gaming junket enterprise."  A person, other than a slot machine licensee, who employs or otherwise engages the services of a gaming junket representative to arrange gaming junkets to a licensed facility, regardless of whether the activities of the person or the gaming junket representative occur within this Commonwealth.

"Gaming junket representative."  An individual, other than an employee of a slot machine licensee, who arranges and negotiates the terms of a gaming junket or selects individuals to participate in a gaming junket to a licensed facility, regardless of whether the activities of the individual occur within this Commonwealth.

"Gaming-related restricted area."  Any room or area of a licensed facility which is specifically designated by the Pennsylvania Gaming Control Board as restricted or by the slot machine licensee as restricted in its board-approved internal controls.

"Gaming school."  Any 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 slot machines, table games or interactive games, including slot machine, table game device and associated equipment maintenance and repair and interactive gaming devices and associated equipment maintenance and repair.

"Gaming service provider."  A person that is not required to be licensed as a manufacturer, supplier, management company or gaming junket enterprise under this part and:

(1)  provides goods or services, including, but not limited to, count room equipment, to a slot machine licensee or an applicant for a slot machine license for use in the operation of a licensed facility; and

(2)  provides goods or services to a slot machine licensee or an applicant for a slot machine license that requires access to the gaming floor or a gaming-related restricted area of a licensed facility.

"Gross interactive airport gaming revenue."  The following shall apply:

(1)  Revenue shall be the total of all cash or cash equivalent wagers paid by an eligible passenger to an interactive gaming certificate holder at a qualified airport through the use of multi-use computing devices in consideration for the play of authorized interactive games at a qualified airport through the use of multi-use computing devices, including cash received as entry fees for contests or tournaments, minus:

(i)  The total of cash or cash equivalents paid out to an eligible passenger as winnings.

(ii)  The actual cost paid by the interactive gaming certificate holder at a qualified airport through the use of multi-use computing devices for personal property distributed to a player as a result of playing an authorized interactive game. This subparagraph does not include travel expenses, food, refreshments, lodging or services.

(2)  Amounts deposited with an interactive gaming certificate holder for purposes of interactive gaming at a qualified airport through the use of multi-use computing devices and amounts taken in fraudulent acts perpetrated against an interactive gaming certificate holder for which the interactive gaming certificate holder is not reimbursed and shall not be considered to have been paid to the interactive gaming certificate holder for purposes of calculating gross interactive airport gaming revenue.

"Gross interactive gaming revenue."  As follows:

(1)  The total of all cash or cash equivalent wagers paid by registered players to an interactive gaming certificate holder in consideration for the play of authorized interactive games, including cash received as entry fees for contests or tournaments, minus:

(i)  The total of cash or cash equivalents paid out to registered players as winnings.

(ii)  The actual cost paid by the interactive gaming certificate holder for any personal property distributed to a player as a result of playing an authorized interactive game. This subparagraph does not include travel expenses, food, refreshments, lodging or services.

(2)  Amounts deposited with an interactive gaming certificate holder for purposes of interactive gaming and amounts taken in fraudulent acts perpetrated against an interactive gaming certificate holder for which the interactive gaming certificate holder is not reimbursed shall not be considered to have been paid to the interactive gaming certificate holder for purposes of calculating gross interactive gaming revenue.

"Gross table game revenue."  The total of:

(1)  Cash or cash equivalents received in the playing of a table game minus the total of:

(i)  Cash or cash equivalents paid to players as a result of playing a table game.

(ii)  Cash or cash equivalents paid to purchase annuities to fund prizes payable to players over a period of time as a result of playing a table game.

(iii)  The actual cost paid by the certificate holder for any personal property distributed to a player as a result of playing a table game. This does not include travel expenses, food, refreshments, lodging or services.

(2)  Contest or tournament fees or payments, including entry fees, buy-ins, re-buys and administrative fees, imposed by a certificate holder to participate in a table game contest or tournament, less cash paid or actual cost paid by a certificate holder for prizes awarded to the contest or tournament winners.

(3)  The total amount of the rake collected by a certificate holder.

The term does not include counterfeit cash or chips; coins or currency of other countries received in the playing of a table game, except to the extent that the coins or currency are readily convertible to cash; or cash taken in a fraudulent act perpetrated against a certificate holder for which the certificate holder is not reimbursed.

"Gross terminal revenue."  The total of:

(1)  cash or cash equivalent wagers received by a slot machine minus the total of:

(i)  Cash or cash equivalents paid out to players as a result of playing a slot machine, whether paid manually or paid out by the slot machine.

(ii)  Cash or cash equivalents paid to purchase annuities to fund prizes payable to players over a period of time as a result of playing a slot machine.

(iii)  Any personal property distributed to a  player as a result of playing a slot machine. This does not include travel expenses, food, refreshments, lodging or services.

(2)  cash received as entry fees for slot machine contests or slot machine tournaments.

The term does not include counterfeit cash or tokens; coins or currency of other countries received in slot machines, except to the extent that the coins or currency are readily convertible to cash; or cash taken in a fraudulent act perpetrated against a slot machine licensee for which the licensee is not reimbursed.

"Holding company."  A person, other than an individual, which, directly or indirectly, owns or has the power or right to control or to vote any 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.

"Horsemen of this Commonwealth."  A thoroughbred or standardbred horse owner or trainer who enters and runs his or her horse at a licensed racing entity in the current or prior calendar year and meets the requirements of the horsemen's organization of which he or she is a member to participate in the receipt of benefits therefrom; or an employee of a trainer who meets the requirements of the horsemen's organization of which he or she is a member to participate in the receipt of benefits therefrom.

"Horsemen's organization."  A trade association which represents the majority of owners and trainers who own and race horses at a licensed racetrack.

"Hotel."  As follows:

(1)  Except as provided under paragraph (2), one or more buildings owned or operated by a certificate holder which  are attached to, physically connected to or adjacent to the certificate holder's licensed facility in which members of the public may, for a consideration, obtain sleeping accommodations.

(2)  When the term is used in section 1305 (relating to Category 3 slot machine license) or 1407(d) (relating to Pennsylvania Gaming Economic Development and Tourism Fund), a building or buildings in which members of the public may, for a consideration, obtain sleeping accommodations.

"Hybrid slot machine."  A slot machine in which a combination of the skill of the player and elements of chance affect the outcome of the game.

"Independent contractor."  A person who performs professional, scientific, technical, advisory or consulting services for the Pennsylvania Gaming Control Board for a fee, honorarium or similar compensation pursuant to a contract.

"Initial auction."  An auction at which a Category 1 and Category 2 slot machine licensee may submit a bid.

"Institutional investor."  Any 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 Advisors Act of 1940 (54 Stat. 847, 15 U.S.C. § 80b-1 et seq.) and such other persons as the Pennsylvania Gaming Control Board may determine consistent with this part.

"Interactive game."  Any gambling game offered through the use of communications technology that allows a person, utilizing money, checks, electronic checks, electronic transfers of money, credit cards or any other instrumentality to transmit electronic information to assist in the placement of a bet or wager and corresponding information related to the display of the game, game outcomes or other similar information. The term shall not include:

(1)  A lottery game or Internet instant game as defined in the act of August 26, 1971 (P.L.351, No.91), known as the State Lottery Law.

(2)  iLottery under Chapter 5 (relating to lottery).

(3)  A nongambling game that does not otherwise require a license under the laws of this Commonwealth.

(4)  A fantasy contest under Chapter 3 (relating to fantasy contests).

"Interactive gaming."  The placing of wagers with an interactive gaming certificate holder or interactive gaming operator using a computer network of both Federal and non-Federal interoperable packet switched data networks through which an interactive gaming certificate holder may offer authorized interactive games to registered players. The term shall include the placing of wagers through the use of a multi-use computing device.

"Interactive gaming account."  The formal, electronic system implemented by an interactive gaming certificate holder to record the balance of a registered player's debits, credits and other financial activity related to interactive gaming.

"Interactive gaming account agreement."  An agreement entered into between an interactive gaming certificate holder and a registered player which governs the terms and conditions of the registered player's interactive gaming account and the use of the Internet for purposes of placing wagers on authorized interactive games operated by an interactive gaming certificate holder or interactive gaming operator.

"Interactive gaming agreement."  An agreement entered into by or between an interactive gaming certificate holder and an interactive gaming operator related to the offering or operation of interactive gaming or an interactive gaming system by the interactive gaming operator on behalf of the interactive gaming certificate holder. The term shall include an interactive gaming agreement entered into between an interactive gaming certificate holder and an interactive gaming operator for the conduct of interactive gaming through the use of multi-use computing devices at a qualified airport in accordance with Chapter 13B (relating to interactive gaming).

"Interactive gaming certificate."  The authorization issued to a slot machine licensee by the Pennsylvania Gaming Control Board authorizing the operation and conduct of interactive gaming by a slot machine licensee in accordance with Chapter 13B (relating to interactive gaming).

"Interactive gaming certificate holder."  A slot machine licensee that has been granted authorization by the Pennsylvania Gaming Control Board to operate interactive gaming in accordance with Chapter 13B (relating to interactive gaming).

"Interactive gaming device."  All hardware and software and other technology, equipment or device of any kind as determined by the Pennsylvania Gaming Control Board to be necessary for the conduct of authorized interactive games.

"Interactive gaming license."  A license issued to an interactive gaming operator by the Pennsylvania Gaming Control Board under Chapter 13B (relating to interactive gaming).

"Interactive gaming operator."  A person licensed by the Pennsylvania Gaming Control Board to operate interactive gaming or an interactive gaming system on behalf of an interactive gaming certificate holder. The term shall include a person that has received conditional authorization under section 13B14 (relating to interactive gaming operators) for so long as such authorization is effective.

"Interactive gaming platform."  The combination of hardware and software or other technology designed and used to manage, conduct and record interactive games and the wagers associated with interactive games, as approved by the Pennsylvania Gaming Control Board. The term shall include any emerging or new technology deployed to advance the conduct and operation of interactive gaming, as approved through regulation by the Pennsylvania Gaming Control Board.

"Interactive gaming reciprocal agreement."  An agreement negotiated by the Pennsylvania Gaming Control Board and approved by the Governor on behalf of the Commonwealth with the regulatory agency of one or more states or jurisdictions where interactive gaming is legally authorized which will permit the conduct of interactive gaming between interactive gaming certificate holders in this Commonwealth and gaming entities in the states or jurisdictions that are parties to the agreement.

"Interactive gaming restricted area."  Any room or area, as approved by the Pennsylvania Gaming Control Board, used by an interactive gaming certificate holder or interactive gaming operator to manage, control and operate interactive gaming, including, where approved by the board, redundancy facilities.

"Interactive gaming skin or skins."  The portal or portals to an interactive gaming platform or interactive gaming website through which authorized interactive games are made available by an interactive gaming certificate holder or interactive gaming operator to registered players in this Commonwealth or registered players in any other state or jurisdiction which has entered into an interactive gaming reciprocal agreement.

"Interactive gaming system."  All hardware, software and communications that comprise a type of server-based gaming system for the purpose of offering authorized interactive games.

"Interactive gaming website."  The interactive gaming skin or skins through which an interactive gaming certificate holder or interactive gaming operator makes authorized interactive games available for play.

"Intermediary."  A person, other than an individual, which:

(1)  is a holding company with respect to a corporation or other form of business organization, which holds or applies for a license under this part; and

(2)  is a subsidiary with respect to any holding company.

"Issued," "issuance" or "issue."  When used in reference to an application submitted to the State Horse Racing Commission or the State Harness Racing Commission to conduct harness or thoroughbred race meetings or the Pennsylvania Gaming Control Board to authorize the placement and operation of slot machines, the terms refer to the date when a determination by the commissions or the board approving an application brought before the agencies becomes final, binding and nonappealable and is not subject to a pending legal challenge.

"Key employee."  Any individual who is employed in a director or department head capacity and who is empowered to make discretionary decisions that regulate slot machine operations, table game operations, interactive gaming operations or casino simulcasting, including the general manager and assistant manager of the licensed facility, director of slot operations, director of table game operations, director of interactive gaming, director of cage and/or credit operations, director of surveillance, director of marketing, director of management information systems, director of interactive gaming system programs or other similar job classifications associated with interactive gaming and casino simulcasting, persons who manage, control or administer interactive gaming and casino simulcasting or the bets and wagers associated with authorized interactive games and casino simulcasting, director of security, comptroller and any employee who is not otherwise designated as a gaming employee and who supervises the operations of these departments or to whom these department directors or department heads report and such other positions not otherwise designated or defined under this part which the Pennsylvania Gaming Control Board shall determine based on detailed analyses of job descriptions as provided in the internal controls of the licensee as approved by the Pennsylvania Gaming Control Board. All other gaming employees unless otherwise designated by the Pennsylvania Gaming Control Board shall be classified as non-key employees.

"Law enforcement authority."  The power to conduct investigations of or to make arrests for criminal offenses.

"Licensed entity."  Any slot machine licensee, manufacturer licensee, supplier licensee or other person licensed by the Pennsylvania Gaming Control Board under this part.

"Licensed entity representative."  A person, including an attorney, agent or lobbyist, acting on behalf of or authorized to represent the interest of any applicant, licensee, permittee or other person authorized by the Pennsylvania Gaming Control Board to engage in any act or activity which is regulated under the provisions of this part regarding any matter before, or which may reasonably be expected to come before, the Pennsylvania Gaming Control Board.

"Licensed facility."  As follows:

(1)  The physical land-based location at which a licensed gaming entity is authorized to place and operate slot machines and, if authorized by the Pennsylvania Gaming Control Board under Chapter 13A (relating to table games), to conduct table games and if authorized under Chapter 13B (relating to interactive gaming), to conduct interactive gaming. The term includes any:

(i)  area of a licensed racetrack at which a slot machine licensee was previously authorized pursuant to section 1207(17) (relating to regulatory authority of board) to operate slot machines prior to the effective date of this paragraph;

(ii)  board-approved interim facility or temporary facility;

(iii)  area of a hotel which the Pennsylvania Gaming Control Board determines is suitable to conduct table games; and

(iv)  area of a licensed facility where casino simulcasting is conducted, as approved by the Pennsylvania Gaming Control Board.

(2)  The term shall not include a redundancy facility or an interactive gaming restricted area which is not located on the premises of a licensed facility as approved by the Pennsylvania Gaming Control Board and which is maintained and operated by an interactive gaming certificate holder in connection with interactive gaming or casino simulcasting.

"Licensed gaming entity" or "slot machine licensee."  A person that holds a slot machine license pursuant to this part.

"Licensed racetrack" or "racetrack."  The physical facility and grounds where a person has obtained a license from either the State Horse Racing Commission or the State Harness Racing Commission to conduct live thoroughbred or harness race meetings respectively with pari-mutuel wagering. The term "racetrack" or "its racetrack" shall mean the physical land-based location at which live horse racing is conducted even if not owned by the person.

"Licensed racing entity."  Any legal entity that has obtained a license to conduct live thoroughbred or harness horse race meetings respectively with pari-mutuel wagering from the State Horse Racing Commission pursuant to the Race Horse Industry Reform Act.

"Manufacturer."  A person who manufactures, builds, rebuilds, fabricates, assembles, produces, programs, designs or otherwise makes modifications to any slot machine, table game device or associated equipment or authorized interactive games for use or play of slot machines, table games or authorized interactive games in this Commonwealth for gaming purposes. The term shall not include a person who manufactures, builds, rebuilds, fabricates, assembles, produces, programs, designs or otherwise makes modifications to multi-use computing devices used in connection with the conduct of interactive gaming at a qualified airport.

"Manufacturer license."  A license issued by the Pennsylvania Gaming Control Board authorizing a manufacturer to manufacture or produce slot machines, table game devices or associated equipment, interactive gaming devices or associated equipment for use in this Commonwealth for gaming purposes.

"Manufacturer licensee."  A manufacturer that obtains a manufacturer license.

"Member."  An individual appointed to and sworn in as a member of the board in accordance with section 1201(b) (relating to Pennsylvania Gaming Control Board established).

"Multi-use computing device."  As follows:

(1)  A computing device, including, but not limited to, a tablet computer, that:

(i)  Is located and accessible to eligible passengers only in an airport gaming area.

(ii)  Allows an eligible passenger to play an authorized interactive game.

(iii)  Communicates with a server that is in a location approved by the Pennsylvania Gaming Control Board.

(iv)  Is approved by the Pennsylvania Gaming Control Board.

(v)  Has the capability of being linked to and monitored by the department's central control computer system, as applicable for any particular interactive game, in accordance with section 1323 (relating to central control computer system).

(vi)  Offers a player additional functions which shall include Internet browsing, the capability of checking flight status and ordering food or beverages.

(2)  The term shall not include any tablet or computing device that restricts, prohibits or is incapable of providing access to interactive gaming, interactive gaming skin or skins or interactive gaming platforms.

"Multistate agreement."  The written agreement, approved by the Governor, between the Pennsylvania Gaming Control Board and regulatory agencies in other states or jurisdictions for the operation of a multistate wide-area progressive slot machine system.

"Multistate wide-area progressive slot machine system."  The linking of slot machines located in this Commonwealth with slot machines located in one or more states or jurisdictions whose regulatory agencies have entered into written agreements with the Pennsylvania Gaming Control Board for the operation of the system.

"Municipal authority."  A body politic and corporate created under the former act of June 28, 1935 (P.L.463, No.191), known as the Municipality Authorities Act of one thousand nine hundred and thirty-five, the former act of May 2, 1945 (P.L.382, No.164), known as the Municipality Authorities Act of 1945, the act of July 29, 1953 (P.L.1034, No.270), known as the Public Auditorium Authorities Law, or 53 Pa.C.S. Ch. 56 (relating to municipal authorities).

"Municipality."  A city, borough, incorporated town or township.

"Net terminal revenue."  The net amount of the gross terminal revenue less the tax and assessments imposed by sections 1402 (relating to gross terminal revenue deductions), 1403 (relating to establishment of State Gaming Fund and net slot machine revenue distribution), 1405 (relating to Pennsylvania Race Horse Development Trust Fund) and 1407 (relating to Pennsylvania Gaming Economic Development and Tourism Fund).

"Nonbanking game."  Any table game in which a player competes against another player and in which the certificate holder collects a rake.

"Nongaming service provider."  A person that is not a gaming service provider or required to be licensed as a manufacturer, supplier, management company or gaming junket enterprise under this part and that provides goods or services:

(1)  to a slot machine licensee or applicant for a slot machine license for use in the operation of a licensed facility; and

(2)  that does not require access to the gaming floor or a gaming-related restricted area.

"Non-peer-to-peer interactive game."  An authorized interactive game in which the player does not compete against players and which is not a peer-to-peer interactive game.

"Nonprimary location."  Any facility in which pari-mutuel wagering is conducted by a licensed racing entity other than the racetrack where live racing is conducted.

"Occupation permit."  A permit authorizing an individual to be employed or work as a gaming employee at a licensed facility.

"Party."  The Bureau of Investigations and Enforcement of the Pennsylvania Gaming Control Board or any applicant, licensee, permittee, registrant or other person appearing of record in any proceeding before the Pennsylvania Gaming Control Board.

"Peer-to-peer interactive game."  An authorized interactive game which is nonbanking, in which a player competes against one or more players and in which the interactive gaming certificate holder collects a rake.

"Permittee."  A holder of a permit issued pursuant to this part.

"Person."  Any natural person, corporation, foundation, organization, business trust, estate, limited liability company, licensed corporation, trust, partnership, limited liability partnership, association or any other form of legal business entity.

"Player."  An individual wagering cash, a cash equivalent or other thing of value in the play or operation of a slot machine, an authorized interactive game or a table game, including during a contest or tournament, the play or operation of which may deliver or entitle the individual playing or operating the slot machine, authorized interactive game or table game to receive cash, a cash equivalent or other thing of value from another player or a slot machine licensee.

"Prepaid access instrument."  A card, code, electronic serial number, mobile identification number, personal identification number or similar device that:

(1)  Allows patron access to funds that have been paid in advance and can be retrieved or transferred through the use of the device.

(2)  Qualifies as an access device for purposes of Regulation E issued by the Board of Governors of the Federal Reserve System under 12 CFR Pt. 205 (relating to electronic fund transfers (Regulation E));

(3)  Must be distributed by a slot machine licensee or its affiliates in order to be considered a cash equivalent at the slot machine licensee's licensed facility or the location of the slot machine licensee's affiliates.

(4)  Must be used in conjunction with an approved cashless wagering system or electronic credit system in order to transfer funds for gaming purposes.

"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, slot machine licensee, manufacturer licensee or supplier licensee deemed to be a principal by the Pennsylvania Gaming Control Board.

"Progressive payout."  A slot machine wager payout that increases in a monetary amount based on the amounts wagered in a progressive system, including a multistate wide-area progressive slot machine system.

"Progressive system."  A computerized system linking slot machines in one or more licensed facilities within this Commonwealth and offering one or more common progressive payouts based on the amounts wagered. The term shall include a multistate wide-area progressive system.

"Publicly traded corporation."  A person, other than an individual, which:

(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 (54 Stat. 789, 15 U.S.C. § 80a-1 et seq.); 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 which has become effective under the Securities Act of 1933 (48 Stat. 74, 15 U.S.C. § 77a et seq.).

"Qualified airport."  A publicly owned commercial service airport.

"Qualified entity."  An entity which is not a Category 1, Category 2 or Category 3 slot machine licensee who may participate in an auction under section 1305.2(b.1) (relating to conduct of auctions) and who has satisfied the requirements of this part and any criteria established by the Pennsylvania Gaming Control Board for licensure, including but not limited to, financial and character suitability requirements, and has been approved by the board.

"Race Horse Industry Reform Act."  3 Pa.C.S. Ch. 93 (relating to race horse industry reform).

"Rake."  A set fee or percentage assessed by a certificate holder for providing the services of a dealer, gaming table or location, to allow the play or operation of any nonbanking game.

"Redundancy facilities."  Any and all rooms or areas used by a slot machine licensee for emergency backup, redundancy or secondary operations attendant to interactive gaming as approved by the Pennsylvania Gaming Control Board.

"Registered player."  An individual who has entered into an interactive gaming account agreement with an interactive gaming certificate holder.

"Revenue- or tourism-enhanced location."  Any location within this Commonwealth determined by the Pennsylvania Gaming Control Board, in its discretion, which will maximize net revenue to the Commonwealth or enhance year-round recreational tourism within this Commonwealth, in comparison to other proposed facilities and is otherwise consistent with the provisions of this part and its declared public policy purposes.

"Security."  As defined in the act of December 5, 1972 (P.L.1280, No.284), known as the Pennsylvania Securities Act of 1972.

"Skill."  The knowledge, dexterity, adroitness, acumen or other mental skill of an individual.

"Skill slot machine."  A slot machine in which the skill of the player, rather than the element of chance, is the predominant factor in affecting the outcome of the game.

"Slot machine."

(1)  The term includes:

(i)  Any mechanical, electrical or computerized contrivance, terminal, machine or other device approved by the Pennsylvania Gaming Control Board which, upon insertion of a coin, bill, ticket, token or similar object therein or upon payment of any consideration whatsoever, including the use of any electronic payment system except a credit card or debit card, is available to play or operate, the play or operation of which, whether by reason of skill or application of the element of chance or both:

(A)  May deliver or entitle the person or persons playing or operating the contrivance, terminal, machine or other device to receive cash, billets, tickets, tokens or electronic credits to be exchanged for cash or to receive merchandise or anything of value whatsoever, whether the payoff is made automatically from the machine or manually.

(B)  May utilize spinning reels or video displays or both.

(C)  May or may not dispense coins, tickets or tokens to winning patrons.

(D)  May use an electronic credit system for receiving wagers and making payouts.

(ii)  Associated equipment necessary to conduct the operation of the contrivance, terminal, machine or other device.

(iii)  A skill slot machine, hybrid slot machine and the devices or associated equipment necessary to conduct the operation of a skill slot machine or hybrid slot machine.

(iv)  A slot machine used in a multistate wide-area progressive slot machine system and devices and associated equipment as defined by the Pennsylvania Gaming Control Board through regulations.

(v)  A multi-use computing device which is capable of simulating, either digitally or electronically, a slot machine.

(2)  The term does not include a fantasy contest terminal within the meaning of Chapter 3.

"Slot machine contest."  A slot machine competition among players for cash, cash equivalents or prizes.

"Slot machine license."  A license issued by the Pennsylvania Gaming Control Board authorizing a person to place and operate slot machines pursuant to this part and the rules and regulations under this part.

"Slot machine licensee."  A person that holds a slot machine license.

"Slot machine tournament."  An organized series of slot machine contests approved by the Pennsylvania Gaming Control Board in which an overall winner is ultimately determined.

"State gaming receipts."  Revenues and receipts required by this part to be paid into the State Gaming Fund, the Pennsylvania Race Horse Development Trust Fund and the Pennsylvania Gaming Economic Development and Tourism Fund, and all rights, existing on the effective date of this section or coming into existence later, to receive any of those revenues and receipts.

"State Treasurer."  The State Treasurer of the Commonwealth.

"Subsequent auction."  An auction at which a Category 1, Category 2 and Category 3 slot machine licensee may submit a bid for a Category 4 license that remains available after an initial auction.

"Subsidiary."  A person other than an individual. The term includes:

(1)  a corporation, any significant part of whose outstanding equity securities are owned, subject to a power 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, which 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 Pennsylvania Gaming Control Board.

"Supplier."  A person that sells, leases, offers or otherwise provides, distributes or services any slot machine, table game device or associated equipment, or interactive gaming device or associated equipment for use or play of slot machines, table games or interactive games in this Commonwealth. The term shall include a person that sells, leases, offers or otherwise provides, distributes or services any multi-use computing device as approved by the Pennsylvania Gaming Control Board.

"Supplier license."  A license issued by the Pennsylvania Gaming Control Board authorizing a supplier to provide products or services related to slot machines, table game devices or associated equipment, interactive gaming devices, including any multi-use computing device or associated equipment, to slot machine licensees for use in this Commonwealth for gaming purposes.

"Supplier licensee."  A supplier that holds a supplier license.

"Suspicious transaction."  A transaction between a slot machine licensee or an employee of a slot machine licensee and an individual that involves the acceptance or redemption by a person of cash or a cash equivalent involving or aggregating $5,000 or more which a slot machine licensee or employee of a slot machine licensee knows, suspects or has reason to believe:

(1)  involves funds derived from illegal activities or is intended or conducted in order to conceal or disguise funds or assets derived from illegal activities;

(2)  is part of a plan to violate or evade any law or regulation or to avoid any transaction reporting requirement under the laws or regulations of this Commonwealth or the United States, including a plan to structure a series of transactions to avoid any transaction reporting requirement under the laws or regulations of this Commonwealth or the United States; or

(3)  has no apparent lawful purpose or is not the type of transaction in which a person would normally be expected to engage and the slot machine licensee or employee knows of no reasonable explanation for the transaction after examining the available facts, including the background and possible purpose of the transaction.

"Table game."  Any banking or nonbanking game approved by the Pennsylvania Gaming Control Board. The term includes roulette, baccarat, blackjack, poker, craps, big six wheel, mini-baccarat, red dog, pai gow, twenty-one, casino war, acey-ducey, sic bo, chuck-a-luck, Panguingue, Fan-tan, Asia poker, Boston 5 stud poker, Caribbean stud poker, Colorado hold'em poker, double attack blackjack, double cross poker, double down stud poker, fast action hold'em, flop poker, four card poker, let it ride poker, mini-craps, mini-dice, pai gow poker, pokette, Spanish 21, Texas hold'em bonus poker, three card poker, two card joker poker, ultimate Texas hold'em, winner's pot poker and any other banking or nonbanking game. The term shall not include:

(1)  Lottery games of the Pennsylvania State Lottery as authorized under the act of August 26, 1971 (P.L.351, No.91), known as the State Lottery Law.

(2)  Bingo as authorized under the act of July 10, 1981 (P.L.214, No.67), known as the Bingo Law.

(3)  Pari-mutuel betting on the outcome of horse race meetings as authorized under the Race Horse Industry Reform Act.

(4)  Small games of chance as authorized under the act of December 19, 1988 (P.L.1262, No.156), known as the Local Option Small Games of Chance Act.

(5)  Slot machine gaming and progressive slot machine gaming as defined and authorized under this part.

(6)  Keno.

(7)  A fantasy contest terminal within the meaning of Chapter 3 (relating to fantasy contests).

(8)  iLottery under Chapter 5 (relating to lottery).

"Table game device."  Includes gaming tables, cards, dice, chips, shufflers, tiles, dominoes, wheels or any mechanical, electrical or computerized contrivance, terminal, machine or other device, apparatus, equipment or supplies approved by the Pennsylvania Gaming Control Board and used to conduct a table game or that is capable, through the use of digital, electronic or other communications technology, of simulating play of a table game.

"Table game operation certificate."  A certificate awarded by the Pennsylvania Gaming Control Board under Chapter 13A (relating to table games) that authorizes a slot machine licensee to conduct table games in accordance with this part.

"Tournament."  An organized series of contests approved by the Pennsylvania Gaming Control Board in which an overall winner is ultimately determined.

"Trustee."  A person appointed by the Pennsylvania Gaming Control Board under section 1332 (relating to appointment of trustee) to manage and control the operations of a licensed facility and who has the fiduciary responsibility to make decisions to preserve the viability of a licensed facility and the integrity of gaming in this Commonwealth.

"Underwriter."  As defined in the act of December 5, 1972 (P.L.1280, No.284), known as the Pennsylvania Securities Act of 1972.

"Winning bid."  The single highest bid received at an auction.

"Winning bidder."  The slot machine licensee or qualified entity with the winning bid.

04c1103v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended the defs. of "associated equipment," "cash equivalent," "cheat," "cheating or thieving device," "commission," "conduct of gaming," "contest," "counterfeit chip," "gaming employee," "gaming school," "gaming service provider," "key employee," "licensed facility," "licensed racing entity," "manufacturer," "manufacturer license," "net terminal revenue," "player," "progressive payout," "progressive system," "Race Horse Industry Reform Act," "slot machine," "State gaming receipts," "supplier," "supplier license," "table game" and "table game device" and added the defs. of "airport authority," "airport gaming area," "auction," "authorized interactive game," "bid," "category 4 location," "communications technology," "concession operator," "eligible passenger," "gaming floor," "gaming-related restricted area," "gross interactive airport gaming revenue," "gross interactive gaming revenue," "hybrid slot machine," "initial auction," "interactive game," "interactive gaming," "interactive gaming account," "interactive gaming account agreement," "interactive gaming agreement," "interactive gaming certificate," "interactive gaming certificate holder," "interactive gaming device," "interactive gaming license," "interactive gaming operator," "interactive gaming platform," "interactive gaming reciprocal agreement," "interactive gaming restricted area," "interactive gaming skin or skins," "interactive gaming system," "interactive gaming website," "multi-use computing device," "multistate agreement," "multistate wide-area progressive slot machine system," "nongaming service provider," "non-peer-to-peer interactive game," "peer-to-peer interactive game," "prepaid access instrument," "qualified airport," "qualified entity," "redundancy facilities," "registered player," "skill," "skill slot machine," "subsequent auction," "winning bid" and "winning bidder."

2010 Amendment.  Act 1 amended the defs. of "associated equipment," "cheat," "conduct of gaming," "conviction," "gaming employee," "gross terminal revenue," "key employee," "licensed facility," "manufacturer," "manufacturer license," "slot machine," "supplier" and "supplier license" and added the defs. of "banking game," "cash," "cash equivalent," "certificate holder," "cheating or thieving device," "chip," "contest," "count room," "counterfeit chip," "electronic gaming table," "executive-level public employee," "fully automated electronic gaming table," "gaming junket," "gaming junket enterprise," "gaming junket representative," "gaming school," "gaming service provider," "gross table game revenue," "hotel," "law enforcement authority," "licensed entity representative," "municipal authority," "nonbanking game," "party," "player," "rake," "slot machine contest," "slot machine tournament," "suspicious transaction," "table game," "table game device," "table game operation certificate," "tournament" and "trustee."

2006 Amendment.  Act 135 amended the defs. of "affilate" or "affiliated company," "applicant," "controlling interest," "gross terminal revenue" and "licensed facility" and added the defs. of "compensation," "complimentary service," "conduct of gaming," "corporation," "holding company," "independent contractor," "intermediary," "member," "principal," "publicly traded corporation," "subsidiary" and "underwriter."

Cross References.  Section 1103 is referred to in sections 302, 3102 of this title; 9301 of Title 3 (Agriculture).

04c1201h

 

 

CHAPTER 12

PENNSYLVANIA GAMING CONTROL BOARD

 

Sec.

1201.  Pennsylvania Gaming Control Board established.

1201.1. Applicability of other statutes.

1202.  General and specific powers.

1202.1. Code of conduct.

1202.2. Expenses of regulatory agencies.

1203.  Temporary regulations.

1204.  Licensed gaming entity application appeals from board.

1205.  License or permit application hearing process; public input hearings.

1206.  Board minutes and records.

1207.  Regulatory authority of board.

1208.  Collection of fees and fines.

1209.  Slot machine license fee.

1210.  Number of slot machines.

1211.  Reports of board.

1212.  Diversity goals of board.

1213.  License or permit prohibition.

1214.  Specific authority to suspend slot machine license.

 

Enactment.  Chapter 12 was added July 5, 2004, P.L.572, No.71, effective immediately.

04c1201s

§ 1201.  Pennsylvania Gaming Control Board established.

(a)  Board established.--There is established an independent board which shall be a body corporate and politic to be known as the Pennsylvania Gaming Control Board.

(b)  Membership.--The board shall consist of the following members:

(1)  Three members appointed by the Governor.

(2)  One member appointed by each of the following:

(i)  The President pro tempore of the Senate.

(ii)  The Minority Leader of the Senate.

(iii)  The Speaker of the House of Representatives.

(iv)  The Minority Leader of the House of Representatives.

(b.1)  Removal.--A member of the board shall be removed from office by the appointing authority:

(1)  for misconduct in office, willful neglect of duty or conduct evidencing unfitness for office or incompetence; or

(2)  upon conviction of an offense graded as a felony, an infamous crime, an offense under this part or an equivalent offense under Federal law or the law of another jurisdiction.

(c)  Initial appointments to board.--

(1)  Gubernatorial appointees initially appointed under subsection (b)(1) shall serve an initial term of one, two and three years respectively as designated by the Governor at the time of appointment and until their successors are appointed and qualified.

(2)  Legislative appointees initially appointed under subsection (b)(2) shall serve until the third Tuesday in January 2007 and until their successors are appointed and qualified.

(3)  An appointment to fill a vacancy created by a member appointed in accordance with paragraph (1) or (2) shall be for the remainder of the unexpired term.

(d)  Terms of office.--Upon the expiration of a term of a member appointed under subsection (c), the following shall apply:

(1)  The term of office of a gubernatorial appointee shall be three years and until a successor is appointed and qualified.

(2)  The term of office of a legislative appointee shall be two years and until a successor is appointed and qualified.

(3)  A legislative appointee shall serve no more than three full consecutive terms.

(4)  A gubernatorial appointee shall serve no more than two full consecutive terms.

(5)  An appointment to fill a vacancy shall be for the remainder of the unexpired term.

(6)  A member appointed to fill a vacancy under paragraph (3) may serve three full terms following the expiration of the term related to the vacancy.

(7)  A member appointed to fill a vacancy under paragraph (4) may serve two full terms following the expiration of the term related to the vacancy.

(e)  Ex officio members.--The Secretary of Revenue, the Secretary of Agriculture and the State Treasurer, or their designees, shall serve on the board as nonvoting ex officio members of the board. The designee shall be a deputy secretary or an equivalent position within the agency.

(f)  Qualified majority vote.--

(1)  Except as permitted in paragraphs (2) and (3), any action, including, but not limited to, the approval, issuance, denial or conditioning of any license by the board under this part or the making of any order or the ratification of any permissible act done or order made by one or more of the members, shall require a qualified majority vote consisting of at least one gubernatorial appointee and the four legislative appointees.

(2)  Any action to suspend or revoke, not renew, void or require forfeiture of a license or permit issued under this part, to impose any administrative fine or penalty under this part or to issue cease and desist orders or similar enforcement actions shall require a majority vote of all the members appointed to the board.

(3)  Notwithstanding any other provision of this part or 65 Pa.C.S. § 1103(j) (relating to restricted activities), a member shall disclose the nature of his disqualifying interest, disqualify himself and abstain from voting in a hearing or proceeding under this part in which his objectivity, impartiality, integrity or independence of judgment may be reasonably questioned, as provided in subsection (h)(6) or section 1202.1(c)(3) (relating to code of conduct). If a legislative appointee has disqualified himself, the qualified majority shall consist of all of the remaining legislative appointees and at least two gubernatorial appointees.

(g)  Background investigation.--Appointees shall be subject to a background investigation conducted by the Pennsylvania State Police in accordance with this part.

(h)  Qualifications and restrictions.--

(1)  Each member at the time of appointment shall be at least 25 years of age and shall have been a resident of this Commonwealth for a period of at least one year immediately preceding appointment. Each member shall continue to remain a resident of this Commonwealth during the term of membership on the board.

(2)  Except for ex officio members, no person shall be appointed a member of the board or be employed by or be an independent contractor of the board if that person is a public official or party officer as defined in section 1512 (relating to financial and employment interests) in this Commonwealth or any of its political subdivisions.

(3)  Each member, employee and independent contractor of the board shall sign an agreement not to disclose confidential information.

(4)  No member, employee or independent contractor of the board or other agency having regulatory authority over the board or over forms of gaming regulated by this part shall be employed, hold any office or position or be engaged in any activity which is incompatible with the position, employment or contract.

(4.1)  No member shall engage in any business, employment or vocation for which the member receives a salary, compensation or fee for services rendered which is in excess of 15% of the member's gross annual salary as a member of the board. For purposes of this paragraph, the terms "salary," "compensation" and "fee" do not include any of the following:

(i)  Passive or unearned income, including interest, dividends or capital gains from the sale of assets or securities held for investment purposes.

(ii)  Health care benefits or retirement, pension or annuity payments.

(iii)  Amounts received from a family-controlled trade or business in which both personal services and capital are income-producing factors, provided that the personal services actually rendered by the member do not generate a significant amount of income.

(iv)  Director's fees attributable to board membership of a corporate or nonprofit body or board or reimbursement for expenses incurred in connection with board membership.

(5)  No member shall be paid or receive any fee or other compensation for any activity related to the duties or authority of the board other than salary and expenses provided by law.

(6)  No member, employee or independent contractor of the board shall participate in a hearing, proceeding or other matter in which the member, employee or independent contractor, or the immediate family thereof, has a financial interest in the subject matter of the hearing or proceeding or other interest that could be substantially affected by the outcome of the hearing or proceeding without first fully disclosing the nature of the interest to the board and other persons participating in the hearing or proceeding. The board shall determine if the interest is a disqualifying interest that requires the disqualification or nonparticipation of an employee or independent contractor. For purposes of this paragraph, the term "immediate family" shall mean spouse, parent, brother, sister or child.

(7)  At the time of appointment and annually thereafter, each member shall disclose the existence of any financial interest in any applicant, licensed entity or licensed facility and in an affiliate, intermediary, subsidiary or holding company thereof held by the member or known to be held by the member's immediate family. The disclosure statement shall be filed with the executive director of the board and with the appointing authority for such member and shall be open to inspection by the public at the office of the board during the normal business hours of the board for the duration of the member's term and for two years after the member leaves office. For purposes of this paragraph, the term "immediate family" shall mean spouse, parent, brother, sister or child.

(7.1)  Prior to being sworn as a member, an appointee and his immediate family shall divest any financial interest in any applicant, licensed facility or licensed entity and in an affiliate, intermediary, subsidiary or holding company thereof owned or held by the appointee or known to be held by the appointee's immediate family. For the duration of the member's term and for  two years thereafter, the member and the member's immediate family may not acquire a financial interest in any applicant, licensed facility or licensed entity or in an affiliate, intermediary, subsidiary or holding company  of an applicant, licensed facility or licensed entity. For purposes of this paragraph, the term "immediate family" shall mean spouse and any minor or unemancipated child.

(7.2)  Prior to entering into employment or a contract with the board and annually thereafter, an employee or independent contractor shall disclose the existence of any financial interest in any applicant, licensed facility or licensed entity and in an affiliate, intermediary, subsidiary or holding company thereof owned or held by the employee or independent contractor or known to be held by the immediate family of the employee or independent contractor. The disclosure statement shall be filed with the board and shall be open to inspection by the public at the office of the board during the normal business hours of the board and for two years after termination of employment or a contract with the board. For purposes of this paragraph, the term "immediate family" shall mean spouse, parent, brother, sister or child.

(7.3)  Prior to entering into employment or contracting with the board, an employee or independent contractor and the employee's or independent contractor's immediate family shall divest any financial interest in any applicant, licensed facility or licensed entity, and in an affiliate, intermediary, subsidiary or holding company thereof, owned or held by the employee or independent contractor or known to be held by the immediate family of the employee or independent contractor. For the duration of the employee's employment with the board or the independent contractor's contract with the board and for one year thereafter, the employee or independent contractor and the immediate family thereof shall not acquire, by purchase, gift, exchange or otherwise, any financial interest in any applicant, licensed facility or licensed entity and in any affiliate, intermediary, subsidiary or holding company thereof. For purposes of this paragraph, the term "immediate family" shall mean spouse and any minor or unemancipated child.

(8)  No member, employee or independent contractor of the board may directly or indirectly solicit, request, suggest or recommend to any applicant, licensed entity, or an affiliate, intermediary, subsidiary or holding company thereof or to any principal, employee, independent contractor or agent thereof, the appointment or employment of any person in any capacity by the applicant, licensed entity, or an affiliate, intermediary, subsidiary or holding company thereof for a period of two years from the termination of term of office, employment or contract with the board.

(9)  No member may accept employment with any applicant, licensed entity, or an affiliate, intermediary, subsidiary or holding company thereof, for a period of two years from the termination of term of office.

(10)  No former member may appear before the board in any hearing or proceeding or participate in any other activity on behalf of any applicant, licensed entity, or an affiliate, intermediary, subsidiary or holding company of an applicant or licensed entity, or any other licensee or permittee, for a period of two years from the termination of term of office.

(11)  No member, employee of the board or independent contractor shall accept a complimentary service, wager or be paid any prize from any wager at any licensed facility within this Commonwealth, at any other facility outside this Commonwealth which is owned or operated by a licensed gaming entity or any of its affiliates, intermediaries, subsidiaries or holding companies or as a result of playing an interactive game including on a multi-use computing device for the duration of their term of office, employment or contract with the board and for a period of two years from the termination of term of office, employment or contract with the board. The provisions of this paragraph prohibiting wagering during the term of employment shall not apply to employees or independent contractors while utilizing slot machines, table game devices, interactive gaming devices or multi-use computing devices for testing purposes or while verifying the performance of a slot machine, table game, interactive gaming device or multi-use computing device as part of an enforcement investigation.

(12)  A member who has been convicted during his term in any domestic or foreign jurisdiction of a felony, infamous crime or gambling offense shall, upon conviction, be automatically removed from the board and shall be ineligible to become a member in the future. If an ex officio member is convicted during his term in any domestic or foreign jurisdiction of a felony, infamous crime or gambling offense, the ex officio member shall, upon conviction, be automatically removed from the board, and a designee shall be designated pursuant to subsection (e) to serve the remainder of the ex officio member's term.

(13)  The following shall apply to an 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:

(i)  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.

(ii)  The individual may not, for a period of two years following termination of employment, appear before the board in a hearing or proceeding or participate in activity on behalf of any applicant, licensee, permittee or licensed entity or on behalf of an affiliate, intermediary, subsidiary or holding company of any applicant, licensee, permittee or licensed entity.

(iii)  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. Violation of  this subparagraph shall result in termination of the individual's employment and subject the violator to section 1518(c) (relating to prohibited acts; penalties).

(iv)  A prospective employee who, upon employment, would be subject to this paragraph must, as a condition of employment, sign an affidavit that the prospective employee will not violate subparagraph (i) or (ii). If the prospective employee fails to sign the affidavit, the board shall rescind any offer of employment and shall not employ the individual.

(13.1)  The following shall apply to an independent contractor 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 gaming under this part:

(i)  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 affiliate, intermediary, subsidiary or holding company of an applicant or a licensed entity.

(ii)  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 any applicant, licensee, permittee or licensed entity or on behalf of an affiliate, intermediary, subsidiary or holding company of any applicant, licensee, permittee or licensed entity.

(iii)  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. A knowing  violation of this subparagraph shall result in termination of the person's employment and subject the violator to section 1518(c).

(iv)  Each contract between the board and an independent contractor which involves the duties set forth in this paragraph shall contain a provision requiring the independent contractor to sign an affidavit that the independent contractor will not violate subparagraph (i) or (ii). If the independent contractor fails to sign the affidavit, the board shall not enter into the contract.

(v)  An independent contractor shall require a prospective employee whose employment would involve the duties set forth in this paragraph to sign an affidavit that the prospective employee will not violate subparagraph (i) or (ii). If the prospective employee fails to sign the affidavit, the independent contractor  shall rescind any offer of employment and shall not employ the individual.

(13.2)  Nothing under paragraph (13) or (13.1) shall 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 any hearing or proceeding as a witness or testifying as to any fact or information.

(14)  The State Ethics Commission shall issue a written determination of whether a person is subject to paragraph (13) or (13.1) 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 any penalty for an action taken, provided that all material facts set forth in the request for  the determination are correct.

(14.1)  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 paragraphs (13) and (13.1). 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 Internet website. Upon request, employees of the board and each independent contractor shall have a duty to provide the State Ethics Commission with adequate information to accurately develop and maintain the list. 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. An individual who relies in good faith on the list published by the State Ethics Commission shall not be subject to any penalty for a violation of paragraph (13) or (13.1).

(15)  If a member of the board violates any provision of this section, the appointing authority may remove the person from the board. A member removed under this paragraph shall, for a period of five years following removal, be prohibited from future appointment to the board and shall be prohibited from applying for a license, permit or other authorization under this part and from becoming an independent contractor or registering as a licensed entity representative.

(h.1)  Fiduciary relationship.--A member or employee of the board shall serve as a fiduciary of the Commonwealth.

(h.2)  Standard of care.--Members shall exercise the standard of care required by 20 Pa.C.S. Ch. 73 (relating to municipalities investments) in the performance of their duties under this part.

(h.3)  Liability.--Members shall not be personally liable for any of the following:

(1)  Obligations of the board.

(2)  Actions which were within the scope of their office and made in good faith.

(i)  Compensation.--

(1)  The Executive Board as established in the act of April 9, 1929 (P.L.177, No.175), known as The Administrative Code of 1929, shall establish the compensation of the members.

(2)  Members shall be reimbursed for all necessary and actual expenses.

(3)  Members shall be eligible for retirement under the State Employees' Retirement Code and shall, if the member elects to participate, be considered a State employee for the purposes of 71 Pa.C.S. Pt. XXV (relating to retirement for State employees and officers).

(j)  Chairman.--The chairman of the board shall be selected by the Governor.

(k)  Appointments.--The appointing authorities shall make their initial appointments within 60 days of the effective date of this part. Appointments to fill a vacancy shall be made within 60 days of the creation of the vacancy. No appointment shall be final until receipt by the appointing authority of the required background investigation of the appointee by the Pennsylvania State Police which shall be completed within 30 days. No person who has been convicted in any domestic or foreign jurisdiction of a felony, infamous crime or gaming offense shall be appointed to the board.

(l)  Prohibition against nepotism.--No member may solicit, request, suggest or recommend the employment by the board of any individual related within the second degree of consanguinity to the member as set forth in 23 Pa.C.S. § 1304(e) (relating to restrictions on issuance of license) or the spouse of the individual.

(m)  Employment requirements.--

(1)  Prospective employees shall submit an application and a personal disclosure form to the board which shall include a complete criminal history, including convictions and current charges for all felonies and misdemeanors.

(2)  Prospective employees shall be required to undergo testing which detects the presence of illegal substances in the body.

(3)  The board shall obtain fingerprints and photographs for each prospective employee consistent with the standards adopted by the Pennsylvania State Police.

(4)  The board shall verify the identification, employment and education of each prospective employee, including:

(i)  Legal name, including any alias.

(ii)  All educational institutions attended regardless of graduation status.

(iii)  Places of residence for the past ten years.

(iv)  Employment history for the past 15 years.

(5)  The board shall not hire a prospective employee if the prospective employee:

(i)  has been convicted of a crime that bears a close relationship to the duties and responsibilities of the position for which employment is sought;

(ii)  has been dismissed from other employment for gross misconduct; or

(iii)  has intentionally made a false statement concerning a material fact in connection with the application to the board.

(6)  The board shall not employ a person unless the requirements of paragraphs (1), (2), (3) and (4) have been met. This paragraph shall apply only to persons employed after the effective date of this subsection.

(7)  The board shall:

(i)  Immediately refer any criminal matter involving an employee to law enforcement.

(ii)  Develop a disciplinary process for an employee charged with a crime or with gross misconduct.

(iii)  Immediately suspend from employment any employee charged with a felony.

(iv)  Develop a process to discipline all other instances of misconduct.

(8)  Disciplinary action shall be instituted promptly against an employee who, while on or off duty, engages in serious misconduct which may bring the board into disrepute.

(m.1)  Budgetary impasse.--If, in the event of a budgetary or other fiscal crisis, the Governor orders the furlough of Commonwealth employees, the board and its employees and all employees of the department and the Pennsylvania State Police whose duties involve the regulation and oversight of gaming under this part shall not be subject to furlough and shall continue to perform their duties of employment.

(n)  Definitions.--As used in this section, the following words and phrases shall have the meanings given to them in this subsection:

"Financial interest."  An ownership, property, leasehold or other beneficial interest in an entity. The term shall not include an interest which is held or deemed to be held in any of the following:

(1)  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 any 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.

(2)  A tuition account plan organized and operated pursuant to section 529 of the Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 529) that is not self-directed by the individual.

(3)  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.

"Ownership interest."  Owning or holding, or being deemed to hold, debt or equity securities or other ownership interest or profit interest.

04c1201v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsec. (h)(11).

2010 Amendment.  Act 1 amended subsecs. (f)(3), (h)(5), (7.1), (10), (11), (13), (14) and (15) and (k) and added subsecs. (h)(4.1), (13.1), (13.2) and (14.1) and (m.1). See sections 19.4 and 20(3) of Act 1 in the appendix to this title for special provisions relating to Pennsylvania Gaming Control Board employees and applicability.

Cross References.  Section 1201 is referred to in sections 1103, 1202, 1202.1, 1209, 1902, 3102, 4301 of this title.

04c1201.1s

§ 1201.1.  Applicability of other statutes.

(a)  General rule.--The following acts shall apply to the board:

(1)  The act of February 14, 2008 (P.L.6, No.3), known as the Right-to-Know Law.

(2)  The act of July 19, 1957 (P.L.1017, No.451), known as the State Adverse Interest Act.

(3)  The provisions of 65 Pa.C.S. Chs. 7 (relating to open meetings) and 11 (relating to ethics standards and financial disclosure).

(b)  Status of board.--

(1)  The board shall be considered an independent agency for the purposes of the following:

(i)  62 Pa.C.S. Pt. I (relating to Commonwealth Procurement Code). The expediting of the payment of revenue to the Commonwealth shall not be grounds for an emergency procurement by the board.

(ii)  The act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act.

(2)  The board shall be considered an agency for the purposes of the following:

(i)  The act of July 31, 1968 (P.L.769, No.240), referred to as the Commonwealth Documents Law.

(ii)  The act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act.

04c1201.1v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 amended subsec. (a)(1).

2006 Amendment.  Act 135 added section 1201.1.

04c1202s

§ 1202.  General and specific powers.

(a)  General powers.--

(1)  The board shall have general and sole regulatory authority over the conduct of gaming and related activities as described in this part. The board shall ensure the integrity of the acquisition and operation of slot machines, table games, table game devices and associated equipment and authorized interactive games and interactive gaming devices and associated equipment and shall have sole regulatory authority over every aspect of the authorization, operation and play of slot machines, table games and interactive gaming devices and associated equipment.

(2)  The board shall employ individuals as necessary to carry out the powers and duties of the board, who shall serve at the board's pleasure. An employee of the board shall be considered a State employee for purposes of 71 Pa.C.S. Pt. XXV (relating to retirement for State employees and officers). For the purposes of this paragraph, the board shall not be considered an executive or independent agency under the act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act. The board shall not take final action to fill any vacancy in the position of executive director of the board, director of the bureau, chief counsel of the board or director of the Office of Enforcement Counsel until receipt and review of the results of the individual's background investigation under section 1517(c)(1.1) (relating to investigations and enforcement).

(3)  In addition to employees authorized by the board, each member may employ one special assistant whose classification and compensation shall be established by the board. A special assistant shall be a State employee for purposes of 71 Pa.C.S. Pt. XXV, shall serve at the pleasure of the member and may only be removed by the board for cause.

(4)  The board shall establish a system of classification and compensation of its employees and shall not be subject to the provisions of the act of April 9, 1929 (P.L.177, No.175), known as The Administrative Code of 1929, as to classification and compensation for its employees and conduct its activities consistent with the practices and procedures of Commonwealth agencies.

(5)  Within 90 days of the effective date of this paragraph, the board shall publish in the Pennsylvania Bulletin and on the board's Internet website the classification system for all employees of the board.

(6)  A request for proposal to conduct investigations of employees and applicants under this part shall include a requirement that an offeror provide the number of employees of the offeror who will be engaged in the conduct of investigations and who are residents of this Commonwealth and annuitants of a Federal, State or local law enforcement agency. Preference shall be given to an offeror with a substantial number of employees who will be engaged in the conduct of investigations and who are residents of this Commonwealth and annuitants of a Federal, State or local law enforcement agency.

(b)  Specific powers.--The board shall have the specific power and duty:

(1)  To adopt, use and alter a corporate seal.

(2)  To pay or satisfy obligations of the board.

(3)  To sue or be sued, implead and be impleaded, or interplead.

(4)  To contract and execute instruments as necessary to carry out the powers and duties of the board. Contracts for the purchase of supplies, services and construction shall be for a term not to exceed two years.

(5)  To sell, transfer, convey and dispose of tangible or intangible property owned by the board.

(6)  To establish, charge and collect fees and fines as authorized by this part.

(7)  To administer oaths, examine witnesses and issue subpoenas compelling the attendance of witnesses or the production of documents and records or other evidence, or to designate officers or employees to perform these duties.

(8)  To purchase insurance against a loss related to the board's property or assets.

(8.1)  To retain attorneys, accountants, auditors and financial and other experts to render services as necessary. For the purposes of this paragraph, the board shall be considered an independent agency for purposes of the Commonwealth Attorneys Act.

(9)  To require background investigations on applicants, licensees, principals, key employees or permittees under the jurisdiction of the board.

(10)  To enter into an agreement with the Pennsylvania State Police for the reimbursement of actual costs as approved by the board to the Pennsylvania State Police for the investigations. Investigations shall include information in the possession of the Attorney General.

(11)  For purposes of licensing and enforcement and for purposes of the background investigation, to receive information otherwise protected by 18 Pa.C.S. Ch. 91 (relating to criminal history record information).

(12)  At its discretion, to issue, approve, renew, revoke, suspend, condition or deny issuance or renewal of slot machine licenses.

(12.1)  At its discretion, to award, revoke, suspend, condition or deny a table game operation certificate to a slot machine licensee in accordance with Chapter 13A (relating to table games).

(12.2)  At its discretion, to award, revoke, suspend, condition or deny an interactive gaming certificate or an interactive gaming license in accordance with Chapter 13B (relating to interactive gaming).

(12.3)  At its discretion, to award, revoke, suspend, condition or deny a casino simulcasting permit in accordance with Chapter 13F (relating to casino simulcasting).

(12.4)  At its discretion, to award, revoke, suspend, condition or deny a sports wagering certificate in accordance with Chapter 13C (relating to sports wagering).

(13)  At its discretion, to issue, approve, renew, revoke, suspend, condition or deny issuance or renewal of supplier and manufacturer licenses.

(14)  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.

(15)  At its discretion, to issue, approve, renew, revoke, suspend, condition or deny issuance or renewal of any additional licenses or permits which may be required by the board under this part.

(16)  At its discretion, to suspend, condition or deny the issuance or renewal of any license or permit or levy fines or other sanctions for any violation of this part.

(17)  To require prospective and existing employees, independent contractors, applicants, licensees and permittees to submit to fingerprinting by the Pennsylvania State Police or an authorized agent of the Pennsylvania State Police. The Pennsylvania State Police or an authorized agent of 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.

(18)  To require prospective and existing employees, independent contractors, applicants, licensees and permittees to submit photographs consistent with the standards established by the board.

(19)  To levy fines or other sanctions against an applicant, licensed entity or other licensee, permittee or employee of the board who possesses, uses, sells or offers for sale any device, equipment or material subject to this part in a manner which constitutes a violation of this part.

(20)  In addition to the power of the board regarding license and permit applicants, to determine at its discretion the suitability of any person who furnishes or seeks to furnish to a slot machine licensee directly or indirectly any goods, services or property related to slot machines, table games, table game devices or associated equipment, interactive games and interactive gaming devices and associated equipment, casino simulcasting technology and equipment or sports wagering and sports wagering devices or through any arrangements under which that person receives payment based directly or indirectly on earnings, profits or receipts from the slot machines, table games, table game devices and associated equipment, interactive games, interactive gaming devices and associated equipment, casino simulcasting technology and equipment or sports wagering and sports wagering devices. The board may require any such person to comply with the requirements of this part and the regulations of the board and may prohibit the person from furnishing the goods, services or property except that, in determining the suitability of a person who furnishes or seeks to furnish casino simulcasting technology and equipment, the board shall consult the commission.

(21)  Within six months after the effective date of this part, in a manner that does not impede the immediate implementation of the duties and responsibilities of the board under this part during the immediate two years after the effective date of this part, to develop and implement an affirmative action plan to assure that all persons are accorded equality of opportunity in employment and contracting by the board, its contractors, subcontractors, assignees, lessees, agents, vendors and suppliers.

(22)  Except for contracts related to the central control computer, all contracts entered into by the board during the two-year period following the effective date of this part shall not exceed a term of two years.

(23)  The board shall not approve an application for or issue or renew a license, certificate, registration or permit unless it is satisfied that the applicant has demonstrated by clear and convincing evidence that the applicant is a person of good character, honesty and integrity and is a person 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 slot machine operations, table game operations, interactive gaming operations, casino simulcasting or sports wagering, or create or enhance the danger of unsuitable, unfair or illegal practices, methods and activities in the conduct of slot machine operations, table game operations, interactive gaming operations, casino simulcasting or sports wagering or the carrying on of the business and financial arrangements incidental thereto.

(24)  Notwithstanding any other provision of law, to sell, in whole or in part, the Commonwealth's right, title and interest in State gaming receipts to the authority. The sale shall be subject to the terms and conditions contained in agreements between the board and the authority. Proceeds from the sale of State gaming receipts shall be allocated and used in the manner otherwise provided by this part for the distribution of State gaming receipts. The authority is authorized to purchase State gaming receipts upon terms and conditions agreed to by the board and to issue bonds to fund the purchase of State gaming receipts in the manner provided for the issuance of authority indebtedness in the law establishing the authority. The State Treasurer is authorized and directed to enter into any agreements with the board and the authority and establish accounts and funds, that shall not be in the State Treasury, as the authority may direct as being necessary or appropriate to effect the sale of State gaming receipts to the authority and the collection and transfer of the State gaming receipts sold to the authority. State gaming receipts sold to the authority shall be the property of the authority and shall not be the property of the Commonwealth.

(25)  To promulgate regulations pertaining to the operation of the bureau to insure separation of functions between the bureau and the board. The board shall provide the employees necessary to the bureau for enforcement of this part.

(26)  To enter into an agreement with the district attorneys of the counties wherein licensed facilities are located and the Office of Attorney General for the reimbursement of actual costs for prosecutions of criminal violations and for investigating a person applying for a determination that an individual has been rehabilitated under this part.

(27)  To publish each January in the Pennsylvania Bulletin and on the board's Internet website a complete list of all persons or entities who applied for or held a slot machine license, manufacturer license, supplier license or racetrack license at any time during the preceding calendar year and all affiliates, intermediaries, subsidiaries and holding companies thereof and the status of the application or license.

(27.1)  To publish each January in the Pennsylvania Bulletin and on the Pennsylvania Gaming Control Board's Internet website a complete list of all slot machine licensees who filed a petition seeking authorization to conduct table games and the status of each petition or table game operation certificate.

(27.2)  Within six months of the effective date of this section, to publish on the board's publicly accessible Internet website a complete list of all slot machine licensees who filed a petition seeking authorization to conduct interactive gaming and the status of each petition or interactive gaming certificate.

(28)  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 1401 (relating to slot machine licensee deposits) required to meet the obligations 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.

(29)  In the event that, in any year, appropriations for the administration of this part are not enacted by June 30, any 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 appropriation for the ensuing fiscal year.

(30)  To promulgate rules and regulations necessary for the administration and enforcement of this part, including regulations in cooperation with the Pennsylvania Liquor Control Board and regulations relating to the sale and service of liquor and malt and brewed beverages by licensees. Except as provided in section 1203 (relating to temporary regulations), regulations shall be adopted pursuant to 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.

(31)  To collect and post information on its Internet website with sufficient detail to inform the public of each person with a controlling interest or ownership interest in an applicant for a slot machine license or a licensed gaming entity, or affiliate, intermediary, subsidiary or holding company of an applicant or licensed gaming entity. The posting shall include:

(i)  If the applicant or licensed gaming entity, or any affiliate, intermediary, subsidiary or holding company of the applicant or licensed gaming entity, is a publicly traded domestic or foreign corporation, partnership, limited liability company or other legal entity, the names of all persons with a controlling interest.

(ii)  If the applicant or licensed gaming entity, or any affiliate, intermediary, subsidiary or holding company of the applicant or licensed gaming entity, 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 any person entitled to cast the vote of a person named under subparagraph (i) or (ii).

(iv)  The names of all officers, directors and principals of the applicant or licensed gaming entity.

(32)  To appoint a trustee as prescribed in section 1332 (relating to appointment of trustee).

(33)  To adopt regulations governing the postemployment limitations and restrictions applicable to members and to employees of the board subject to section 1201(h)(13) (relating to Pennsylvania Gaming Control Board established). In developing these regulations, the board may consult with the State Ethics Commission, other governmental agencies and the disciplinary board of the Supreme Court of Pennsylvania regarding postemployment limitations and restrictions on members and employees of the board who are members of the Pennsylvania Bar.

(34)  To review detailed site plans identifying a petitioner's proposed table game area within a licensed facility to determine the adequacy of the proposed internal and external security and proposed surveillance measures.

(35)  To review detailed site plans identifying the interactive gaming restricted area or room where a slot machine licensee proposes to manage, administer or control interactive gaming operations to determine the adequacy of the proposed internal and external security and proposed surveillance measures.

(36)  To require each slot machine licensee that holds an interactive gaming certificate to provide on a quarterly basis the following information with respect to interactive gaming:

(i)  the name of any person, entity or firm to whom any payment, remuneration or other benefit or thing of value has been made or conferred for professional services, including, but not limited to, interactive gaming system operations or management, legal, consulting and lobbying services;

(ii)  the amount or value of the payments, remuneration, benefit or thing of value;

(iii)  the date on which the payments, remuneration, benefit or thing of value was submitted; and

(iv)  the reason or purpose for the procurement of the services.

(37)  To review and approve detailed site and architectural plans identifying the area of a licensed facility where a slot machine licensee proposes to place slot machines that are or will be used in a multistate wide-area progressive slot machine system, skill slot machines or hybrid slot machines or administer casino simulcasting and make them available for play in order to determine the adequacy of proposed internal and external controls, security and proposed surveillance measures.

(38)  To conduct auctions under section 1305.2 (relating to conduct of auctions).

04c1202v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsecs. (a)(1) and (b)(17), (18), (20) and (23) and added subsec. (b)(12.2), (12.3), (12.4), (27.2), (35), (36), (37) and (38).

2010 Amendment.  Act 1 amended subsecs. (a)(1) and (2) and (b)(7), (20) and (23) and added subsec. (b)(12.1), (27.1), (31),(32), (33) and (34). See section 20(2) of Act 1 in the appendix to this title for special provisions relating to applicability.

Cross References.  Section 1202 is referred to in sections 332, 1103, 1209, 1317.3, 1320, 13A41, 13B55, 1512, 1517, 4104 of this title.

04c1202.1s

§ 1202.1.  Code of conduct.

(a)  Scope.--The board shall adopt a comprehensive code of conduct prior to the consideration of any license, permit or registration application. The code of conduct shall supplement all other requirements under this part and 65 Pa.C.S. Pt. II (relating to accountability) and shall provide guidelines applicable to members, employees of the board, independent contractors and the immediate family of the members, employees and independent contractors to enable them to avoid any perceived or actual conflict of interest and to promote public confidence in the integrity and impartiality of the board. At a minimum, the code of conduct adopted under this section shall include registration of licensed entity representatives under subsection (b) and the restrictions under subsections (c) and (c.1).

(b)  Registration.--

(1)  A licensed entity representative shall register with the board in a manner prescribed by the board, which 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 have an  affirmative duty to update its 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 which shall contain the information required under paragraph (1) and which shall be available for public inspection at the offices of the board and on the board's Internet website.

(c)  Restrictions.--In addition to the other prohibitions contained in this part, a member shall:

(1)  (Reserved).

(2)  Not accept any discount, gift, gratuity, compensation, travel, lodging or other thing of value, directly or indirectly, from any applicant, licensed entity, affiliate, subsidiary or intermediary of an applicant or a licensed entity, permittee, registrant or licensed entity representative.

(3)  Disclose and recuse himself from any 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 any hearing or proceeding or a person appearing before the board.

(4)  Refrain from any financial or business dealing which would tend to reflect adversely on the member's objectivity, impartiality or independence of judgment.

(5)  Not hold or campaign for public office, hold an office in any political party or political committee, as defined in section 1513(d) (relating to political influence), contribute to or solicit contributions to a political campaign, political party, political committee or candidate, publicly endorse a candidate or actively participate in a political campaign.

(6)  Not solicit funds for any charitable, educational, religious, health, fraternal, civic or other nonprofit entity from any applicant, licensed entity, party, permittee, registrant or licensed entity representative, or from any affiliate, subsidiary, intermediary or holding company of  any applicant, licensed entity, party or licensed entity representative. 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. A member may permit his 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.

(7)  Not meet or engage in discussions with any applicant, licensed entity, permittee, registrant, licensed entity representative, person who provides goods, property or services to a slot machine licensee or any other 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. The log shall be available for public inspection during the regular business hours of the board and shall be posted on the board's Internet website. The log shall include the date and time of the meeting or discussion, the names of the participants and the subject discussed. The provisions of this paragraph shall not apply to meetings to consider matters requiring the physical inspection of the equipment or premises of an applicant or a licensed entity provided the meeting is entered in the log.

(8)  Avoid impropriety and the appearance of impropriety at all times and observe standards and conduct that promote public confidence in the oversight of gaming.

(9)  Comply with any other laws, rules or regulations relating to the conduct of a member.

(c.1)  Ex parte communications.--

(1)  No member or hearing officer of the board shall engage in any ex parte communication with any person. No attorney of the Office of Chief Counsel advising the board on a particular licensing issue or proceeding shall engage in any ex parte communication with any person.

(2)  No attorney representing the bureau or the Office of Enforcement Counsel or an applicant, licensee or permittee in any proceeding shall engage in an ex parte communication with a member, an attorney of the Office of Chief Counsel who is advising the board on a proceeding or a hearing officer of the board.

(3)  No employee of the bureau or the Office of Enforcement Counsel shall engage in an ex parte communication with a member, an attorney of the Office of Chief Counsel who is advising the board on a proceeding or a hearing officer of the board.

(c.2)  Procedures relating to ex parte communications.--

(1)  An ex parte communication received or engaged in by a member or hearing officer shall be recorded in a log. The log shall be available for public inspection during the regular business hours of the board and shall be posted on the board's Internet website. The log shall include:

(i)  The name of the individual documenting the ex parte communication.

(ii)  The date and time of the ex parte communication.

(iii)  The names of all individuals involved in the ex parte communication.

(iv)  The subject discussed.

(2)  In addition to documenting an ex parte communication under paragraph (1), notification of the substance of the communication and an opportunity to respond shall be provided to all parties to a hearing or other proceeding directly affected by the anticipated vote or action of the hearing officer or board related to the ex parte communication.

(3)  (i)  A member or hearing officer who engaged in or received an ex parte communication shall recuse himself from any hearing or other proceeding related to the ex parte communication if the context and substance of the ex parte communication creates substantial reasonable doubt as to the individual's ability to act objectively, independently or impartially.

(ii)  A member or hearing officer who engaged in or received an ex parte communication who elects not to recuse himself from a hearing or other proceeding shall state his reasons for not recusing himself on the record prior to the commencement of the hearing or proceeding.

(iii)  If a legislative appointee recuses himself from any hearing or other proceeding under this section, any qualified majority vote required under this part shall consist of all of the remaining legislative appointees and at least two gubernatorial appointees.

(iv)  Failure of a hearing officer who engaged in or received an ex parte communication to recuse himself from a hearing or other proceeding when required under subparagraph (i) shall be grounds for appeal to the board.

(v)  Failure of a member who engaged in or received an ex parte communication to recuse himself from a hearing or other proceeding when required under subparagraph (i) shall be grounds for appeal to a court of competent jurisdiction if the board action being appealed could not have occurred without the participation of the member.

(4)  This subsection shall not preclude a member from consulting with other members individually if the consultation complies with 65 Pa.C.S. Ch. 7 (relating to open meetings) or with employees or independent contractors whose functions are to assist the board in carrying out its adjudicative functions.

(d)  Ex officio members.--The restrictions under subsection (c)(5) shall not apply to ex officio members.

(e)  Definitions.--As used in this section, the following words and phrases shall have the meanings given to them in this subsection:

"Ex parte communication."  An off-the-record communication engaged in or received by a member or hearing officer of the board regarding the merits of or any fact in issue relating to a pending matter before the board or hearing officer or which may reasonably be expected to come before the board or hearing officer in a contested on-the-record proceeding. The term shall not include off-the-record communications by or between a member or hearing officer of the board, department, Pennsylvania State Police, Attorney General or other law enforcement official prior to the beginning of the proceeding solely for the purpose of seeking clarification or correction to evidentiary materials intended for use in the proceedings. The term shall also not include communications between the board or a member and the office of chief counsel.

"Licensed entity representative."  (Deleted by amendment).

04c1202.1v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

Cross References.  Section 1202.1 is referred to in sections 1201, 1512, 1512.1, 1516.1, 4301, 4303, 4304 of this title.

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§ 1202.2.  Expenses of regulatory agencies.

(a)  Reimbursement.--Members and employees of the board, employees of the department and the Office of Attorney General, and troopers and employees of the Pennsylvania State Police, whose duties involve the regulation or enforcement of gaming under this part who are seeking reimbursement from funds which are or will be paid by an applicant for a slot machine license or a slot machine licensee or from the assessments made by the department under section 1402(a)(relating to gross terminal revenue deductions) may be reimbursed only for actual and reasonable expenses incurred during the performance of their duties under this part.

(b)  Receipts.--In order to receive reimbursement for an expense under subsection (a), the individual seeking reimbursement must submit a receipt to the appropriate agency documenting the expense incurred. Receipts and requests for reimbursement shall be financial records for purposes of, and subject to redaction under, the act of February 14, 2008 (P.L.6, No.3), known as the Right-to-Know Law.

04c1202.2v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 added section 1202.2.

04c1203s

§ 1203.  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 part. 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 adopt temporary regulations in subsection (a) shall expire April 15, 2007. Regulations adopted after this period shall be promulgated as provided by law.

04c1203v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

 

Cross References.  Section 1203 is referred to in sections 1202, 1501 of this title.

04c1204s

§ 1204.  Licensed gaming entity application appeals from board.

The Supreme Court of Pennsylvania shall be vested with exclusive appellate jurisdiction to consider appeals of any final order, determination or decision of the board involving the approval, issuance, denial or conditioning of a slot machine license, the award, denial or conditioning of a table game operation certificate or the award, denial or conditioning of an interactive gaming certificate, an interactive gaming license, a casino simulcasting permit or a sports wagering certificate. Notwithstanding the provisions of 2 Pa.C.S. Ch. 7 Subch. A (relating to judicial review of Commonwealth agency action) and 42 Pa.C.S. § 763 (relating to direct appeals from government agencies), the Supreme Court shall affirm all final orders, determinations or decisions of the board involving the approval, issuance, denial or conditioning of a slot machine license, the award, denial or conditioning of a table game operation certificate or the award, denial or conditioning of an interactive gaming certificate, an interactive gaming license, a casino simulcasting permit or a sports wagering certificate, unless it shall find that the board committed an error of law or that the order, determination or decision of the board was arbitrary and there was a capricious disregard of the evidence.

04c1204v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

04c1205s

§ 1205.  License or permit application hearing process; public input hearings.

(a)  General rule.--The board's consideration and resolution of all license or permit applications shall be conducted in accordance with 2 Pa.C.S. (relating to administrative law and procedure) or with procedures adopted by order of the board. Notwithstanding the requirements of 2 Pa.C.S. §§ 504 (relating to hearing and record) and 505 (relating to evidence and cross-examination) as they relate to the conduct of oral hearings, the board may adopt procedures to provide parties before it with a documentary hearing, and the board may resolve disputed material facts without conducting an oral hearing where constitutionally permissible.

(b)  Public input hearing requirement.--

(1)  The board shall hold at least one public input hearing prior to:

(i)  Approving a slot machine license application or renewing a slot machine license.

(ii)  Approving the structural redesign of a licensed facility located in a city of the first class.

(2)  All public input hearings under paragraph (1) shall be held in the municipality where the licensed facility will be, or is, located and shall be organized in cooperation with the municipality.

(3)  A list of all witnesses scheduled to testify at a public input hearing shall be made public at least seven days prior to the hearing. The list shall be updated at least three days prior to the hearing. Additional witnesses shall be posted on the board's Internet website as they are added to the list.

(4)  In addition to any witnesses scheduled to testify under paragraph (3), the board shall establish a public comment period during which time members of the public may address the board regarding the application, license or proposed structural redesign. The board, in its discretion, may place reasonable time limits on an individual's comments.

04c1205v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 amended subsec. (b)(1) and (2) and added subsec. (b)(4).

2006 Amendment.  Section 19 of Act 135 provided that subsec. (b) shall apply to any slot machine license application filed on or after the effective date of section 19.

04c1206s

§ 1206.  Board minutes and records.

(a)  Open proceedings and records.--(Deleted by amendment).

(b)  Record of proceedings.--The board shall cause to be made and kept a record of all proceedings held at public meetings of the board. The verbatim transcript of those proceedings shall be the property of the board and shall be prepared by the board upon the request of any board member or upon the request of any other person and the payment by that person of the costs of preparation.

(c)  Information delivered to Governor and General Assembly.--(Deleted by amendment).

(d)  Applicant information.--

(1)  The board shall maintain a list of all applicants for licenses and permits. The list shall include a record of all actions taken with respect to each applicant. The list shall be open to public inspection during the normal business hours of the board.

(2)  Information under paragraph (1) regarding any applicant whose license or permit has been denied, revoked or not renewed shall be removed from such list after seven years from the date of the action.

(e)  Other files and records.--The board shall maintain such other files and records as it may deem appropriate.

(f)  Confidentiality of information.--

(1)  The following information submitted by an applicant, permittee, certificate holder, interactive gaming certificate holder or licensee pursuant to section 1310(a) (relating to slot machine license application character requirements), 1308(a.1) (relating to applications for license or permit), 13B12 (relating to interactive gaming certificate required and content of petition), 13B14 (relating to interactive gaming operators), 13C12 (relating to petition requirements) or 13F12 (relating to casino simulcasting permit) 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)  All 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 under section 1310(a) or 1308(a.1) 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, licensee, permittee, certificate holder, interactive gaming certificate holder, interactive gaming operator, casino simulcasting permit holder or sports wagering certificate holder, 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, which may include 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, location of interactive gaming restricted areas and redundancy facilities, emergency management plans, security and surveillance plans, equipment and usage protocols and theft and fraud prevention plans and countermeasures.

(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 any 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)  Any financial information deemed confidential by the board upon a showing of good cause by the applicant or licensee.

(2)  No claim of confidentiality shall be made regarding any 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 shall be made regarding any record in possession of the board that is otherwise publicly available from a Commonwealth agency, local agency or another jurisdiction.

(3.1)  Notwithstanding paragraph (1)(iii), for purposes of a public input hearing under this part, the board may release architectural renderings or models depicting a proposed structural design or redesign of the licensed facility that is the subject of the hearing.

(4)  Except as provided in section 1517(f) (relating to  investigations and enforcement), the information made confidential pursuant to this section shall be withheld from public disclosure in whole or in part, except that any 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 such 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 any applicant or licensee to waive any confidentiality provided for in this subsection as a condition for the approval of an application, renewal of a license or any other action of the board.

(6)  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 any 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 any person, knowing that the information being disclosed is confidential under this subsection, unless the person is authorized by law to receive it. A violation of this subsection constitutes a misdemeanor of the third degree. In addition, an employee, agent or independent contractor who violates this subsection shall be administratively disciplined by discharge, suspension, termination of 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.

(g)  Notice.--Notice of the contents of any information, except to a duly authorized law enforcement agency pursuant to this section, shall be given to any applicant or licensee in a manner prescribed by the rules and regulations adopted by the board.

(h)  Information held by department.--Files, records, reports and other information in the possession of the department pertaining to licensees shall be made available to the board as may be necessary to the effective administration of this part.

04c1206v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsec. (f)(1).

2010 Amendment.  Act 1 amended subsec. (f).

2006 Amendment.  Act 135 amended subsecs. (b), (d) and (f) and deleted subsecs. (a) and (c).

Cross References.  Section 1206 is referred to in sections 13A12, 13B12, 13B20, 13C12, 13F11 of this title.

04c1207s

§ 1207.  Regulatory authority of board.

The board shall have the power and its duties shall be to:

(1)  Deny, deny the renewal, revoke, condition or suspend any license, permit, certificate, registration or other authorization provided for in this part if the board finds in its sole discretion that a licensee, permittee, registrant, certificate holder, or interactive gaming certificate holder, under this part, or its officers, employees or agents, have 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, permit, certificate, registration or other authorization.

(2)  Restrict access to confidential information in the possession of the board which has been obtained under this part and ensure that the confidentiality of information is maintained and protected. Records shall be retained by the board for seven years.

(3)  Prescribe and require periodic financial reporting and internal control requirements for all licensed entities.

(4)  Require that each licensed entity provide to the board its audited 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)  Prescribe the procedures to be followed by slot machine licensees for any financial event that occurs in the operation and play of slot machines, table games, authorized interactive games, casino simulcasting, multi-use computing devices or sports wagering.

(6)  Prescribe criteria and conditions for the operation of slot machine progressive systems, including multistate wide-area progressive slot machine systems. A wide area progressive slot system shall be collectively administered by participating slot machine licensees in accordance with the terms of a written agreement executed by each participating slot machine licensee and, in the case of a multistate wide-area progressive slot machine system, in accordance with the multistate agreement, as approved by the board.

(6.1)  Collaborate with the appropriate regulatory agencies in other states or jurisdictions to facilitate the establishment of multistate wide-area progressive slot machine systems by slot machine licensees in this Commonwealth and, if determined necessary, enter into the multistate agreements.

(7)  Enforce prescribed hours for the operation of slot machines so that slot machine licensees may operate slot machines on any day during the year in order to meet the needs of patrons or to meet competition.

(7.1)  Enforce prescribed hours for the operation of table games so that a certificate holder may conduct table games on any day during the year in order to meet the needs of patrons or to meet competition.

(7.2)  Enforce prescribed hours for the operation of authorized interactive games so that an interactive gaming certificate holder or interactive gaming operator may conduct authorized interactive games on any day during the year in order to meet the needs of registered players or to meet competition.

(7.3)  In consultation with the commission, enforce prescribed hours of operation of casino simulcasting by slot machine licensees.

(8)  Require that each licensed gaming entity prohibit persons under 21 years of age from operating or using slot machines, playing table games or participating in interactive gaming, casino simulcasting and sports wagering.

(9)  Establish procedures for the inspection and certification of compliance of each slot machine, table game, table game device and associated equipment, interactive game and interactive gaming device and associated equipment, casino simulcasting technology and equipment and sports wagering and sports wagering devices prior to being placed into use by a slot machine licensee. The board shall collaborate with the commission to facilitate the inspection and certification of casino simulcasting technology and equipment.

(10)  Subject to paragraph (10.1), require that no slot machine or authorized interactive game that replicates the play of a slot machine, other than a slot machine or authorized interactive game that replicates the play of a slot machine that is used in a multistate wide-area progressive slot machine system, may be set to pay out less than the theoretical payout percentage, which shall be no less than 85%, as specifically approved by the board. The board shall adopt regulations that define the theoretical payout percentage based on the total value of the jackpots expected to be paid by a play or a slot machine game or an authorized interactive game that replicates the play of a slot machine divided by the total value of wagers expected to be made on that play or slot machine game or an authorized interactive game that replicates the play of a slot machine during the same portion of the game cycle. In so doing, the board shall decide whether the calculation shall include the entire cycle of a slot machine game or an authorized interactive game that replicates the play of a slot machine or any portion thereof. Subject to paragraph (10.1), in the case of a slot machine that is used in a multistate wide-area progressive slot machine system, the theoretical payout percentage shall be as set forth in the multistate agreement.

(10.1)  For each of the following, define the player's win percentage based on the relative skill of the player or the combination of skill and the elements of chance of the game:

(i)  A skill slot machine or an authorized interactive game that replicates the play of a skill slot machine. For a skill slot machine or authorized interactive game that replicates the play of a skill slot machine that is used in a multistate wide-area progressive slot machine system, the player's win percentage shall be as set forth in the multistate agreement.

(ii)  A hybrid slot machine or an authorized interactive game that replicates the play of a hybrid slot machine. For a hybrid slot machine or an authorized interactive game that replicates the play of a hybrid slot machine that is used in a multistate wide-area progressive slot machine system, the player's win percentage shall be set forth in the multistate agreement.

(11)  Require each slot machine license applicant to provide detailed site plans of its proposed licensed facility which shall be reviewed and approved by the board for the purpose of determining the adequacy of the proposed security and surveillance measures inside and outside the facility. Applicants will cooperate with the board in making changes to the plans suggested by the board and will ensure that the plans as modified and approved are implemented.

(12)  Upon request, provide background investigation reports of applicants for licenses and permits for use at racetracks to the State Horse Racing Commission and the State Harness Racing Commission.

(13)  Require slot machine licensees to provide onsite facilities for use by the board and other appropriate persons for the purpose of carrying out their respective responsibilities under this part.

(14)  Consult with members of the Pennsylvania State Police, the Office of Attorney General, the department and such other persons it deems necessary for advice regarding the various aspects of the powers and duties imposed on it under this part and its jurisdiction over the authorization,  operation and play of slot machines, table games and licensed facilities.

(15)  Enter into contracts with any person for the purposes of carrying out the powers and duties of the board under this part.

(16)  Require each slot machine licensee to sell Pennsylvania State Lottery tickets at its licensed facility at a location as near as practicable to the pay windows.

(17)  Permit, in its discretion and upon application or petition, the use of a temporary facility within which slot machines and table games may be available for play or operation at a licensed gaming facility, for a period not to exceed 24 months, provided that, upon good cause shown, the board may extend permission to operate a temporary facility for an additional 24-month period.

(18)  (Reserved).

(19)  Authorize an employee of the board to approve, deny or condition a request to decrease the number of slot machines in operation at a licensed facility. An employee may not approve a requested decrease in the number of slot machines under this paragraph if the requested decrease exceeds 2% of the total number of slot machines in operation at a licensed facility. Except as provided under paragraph (20), at no time shall the number of slot machines in operation at a Category 1 or Category 2 licensed facility be less than 1,500 or less than 250 slot machines at a Category 3 licensed facility.

(20)  Approve or authorize an employee of the board to approve a temporary reduction in the number of slot machines in operation at a licensed facility under the following circumstances:

(i)  For the duration of any renovation, remodeling or modification of an area of a licensed facility where slot machines are located.

(ii)  To enable the licensed facility to respond to an emergency.

(21)  Authorize, in its discretion, a slot machine licensee to conduct slot machine contests or tournaments, table game contests or tournaments in accordance with section 13A22.1 (relating to table game tournaments) or interactive gaming contests or tournaments and adopt regulations governing the conduct of such contests and tournaments.

(21.1)  Authorize, at its discretion, a slot machine licensee to place slot machines that are used in a multistate wide-area progressive slot machine system, skill slot machines or hybrid slot machines and make them available for play at licensed facilities.

(21.2)  Adopt and promulgate regulations to govern the operation and placement of skill slot machines and hybrid slot machines by slot machine licensees at licensed facilities in the same manner as provided in section 13B03 (relating to regulations).

(22)  License, regulate, investigate and take any other action determined necessary regarding all aspects of interactive gaming, casino simulcasting and sports wagering.

(23)  Define and limit the rules of authorized interactive games, including odds, interactive gaming devices and associated equipment permitted and the method of operation of authorized interactive games and interactive gaming devices and associated equipment.

(24)  Require, as applicable, that all wagering offered through an interactive gaming website display the permissible minimum and maximum wagers associated with each authorized interactive game.

(25)  Ensure, in consultation with the commission, that the wagering at casino simulcasting facilities is conducted in conformance with the pari-mutuel system of wagering regulated by the commission under 3 Pa.C.S. Ch. 93 (relating to race horse industry reform).

(26)  Negotiate and enter into interactive gaming reciprocal agreements on behalf of the Commonwealth to govern the conduct of interactive gaming between interactive gaming certificate holders in this Commonwealth and gaming entities in other states or jurisdictions. Notwithstanding any provision of this part, wagers may be accepted in accordance with this part and regulations of the board from persons in other states or jurisdictions and wagers from persons in this Commonwealth may be made through an interactive gaming platform to a state or jurisdiction with which the Commonwealth has an interactive gaming reciprocal agreement if the board determines that such wagering is not inconsistent with Federal law or the law of the state or jurisdiction in which the person or gaming entity is located, or such wagering is conducted pursuant to an interactive gaming reciprocal agreement to which this Commonwealth is a party that is not inconsistent with Federal law. The board, with the approval of the Governor, is hereby designated as the agency of the Commonwealth with the power and authority to enter into interactive gaming reciprocal agreements with other states or jurisdictions.

(27)  Enter into multistate agreements with other states or jurisdictions for the operation of multistate wide-area progressive slot machine systems.

(28)  Authorize a Category 2 or Category 3 slot machine licensee to enter into an agreement with a Category 1 slot machine licensee for the conduct of casino simulcasting under the Category 1 slot machine licensee's authority as a licensed racing entity, if such agreement is approved by the board and by the commission, pursuant to the commission's authority under 3 Pa.C.S. Ch. 93.

(29)  Adopt, in consultation with the commission, regulations to govern the conduct of casino simulcasting by a Category 2 or Category 3 slot machine licensee in accordance with paragraph (28).

(30)  Adopt and promulgate regulations to govern the installation of video display technology in approved areas of a Category 1 licensed facility to enable the delivery of simulcast horse race meetings to patrons through video walls and other such video display technology. The board may consult with the commission to facilitate the installation of video display monitors in accordance with this paragraph and to facilitate the conduct of casino simulcasting under paragraph (28).

04c1207v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended pars. (1), (5), (6), (8), (9), (10) and (21) and added pars. (6.1), (7.2), (7.3), (10.1), (21.1), (21.2), (22), (23), (24), (25), (26), (27), (28), (29) and (30).

2010 Amendment.  Act 1 amended pars. (4), (5), (8), (9), (14) and (17) and added pars. (7.1), (18), (19), (20) and (21).

Cross References.  Section 1207 is referred to in sections 1103, 1317.3, 13A02, 13C02, 13F44 of this title.

04c1208s

§ 1208.  Collection of fees and fines.

The board has the following powers and duties:

(1)  To levy and collect fees from the various applicants, licensees and permittees to fund the operations of the board. Unless otherwise provided in this part, the fees shall be deposited into the State Gaming Fund as established in section 1403 (relating to establishment of State Gaming Fund and net slot machine revenue distribution) and distributed to the board upon appropriation by the General Assembly. In addition to the fees set forth in sections 1209 (relating to slot machine license fee) and 1305 (relating to Category 3 slot machine license), the board shall assess and collect fees as follows:

(i)  Supplier licensees shall pay:

(A)  A fee of $25,000 upon the issuance of a license to supply slot machines or associated equipment used in connection with slot machines.

(B)  A fee of $25,000 upon the issuance of a license to supply table game devices or associated equipment used in connection with table games or table game devices.

(C)  A fee of $15,000 for the annual renewal of the appropriate supplier license. Upon the extension of the renewal period under section 1317(c)(1) (relating to supplier licenses), the fee shall be $45,000 for the renewal.

(D)  Notwithstanding the fees established under clauses (B) and (C), the board may modify the fees upon the board's determination that the fees will unreasonably limit the availability of table game devices or associated equipment used in connection with table games or table game devices in this Commonwealth.

(ii)  Manufacturer licensees shall pay:

(A)  A fee of $50,000 upon the issuance of a license to manufacture slot machines and associated equipment used in connection with slot machines.

(B)  A fee of $50,000 upon the issuance of a license to manufacture table game devices or associated equipment used in connection with table games or table game devices.

(C)  A fee of $30,000 for the annual renewal of the appropriate manufacturer license. Upon the extension of the renewal period under section 1317.1(c)(1) (relating to manufacturer licenses), the fee shall be $90,000 for the renewal.

(D)  Notwithstanding the fees established under clauses (B) and (C), the board may modify the fees upon the board's determination that the fees will unreasonably limit the availability of table game devices or associated equipment used in connection with table games or table game devices in this Commonwealth.

(iii)  Each application for a slot machine license, supplier license or manufacturer license must be accompanied by a nonrefundable fee set by the board for the cost of each individual requiring a background investigation. The reasonable and necessary costs and expenses incurred in any background investigation or other investigation or proceeding concerning any applicant, licensee, permittee or registrant shall be reimbursed to the board by those persons.

(1.1)  To collect the proceeds of auctions under section 1305.2 (relating to conduct of auctions).

(2)  To provide for the assessment and collection of fines and penalties for violations of this part. All fines and penalties shall be credited for deposit to the General Fund. Two years following enactment of this part, the board shall have the authority to increase each year any fee, charge, cost or administrative penalty, but not any criminal fine or penalty, provided in this part by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index for All Urban Consumers (CPI-U) 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, immediately prior to the date the adjustment is due to take effect.

04c1208v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added par. (1.1).

2010 Amendment.  Act 1 amended par. (1).

Cross References.  Section 1208 is referred to in sections 13A61, 13B20.3, 13C16, 13C61 of this title.

04c1209s

§ 1209.  Slot machine license fee.

(a)  Imposition.--Except as provided for a Category 3 licensed gaming entity under section 1305 (relating to Category 3 slot machine license) or a Category 4 slot machine licensee under section 1305.1 (relating to Category 4 slot machine license) and subject to the requirements of this section, at the time of license issuance the board shall impose a one-time slot machine license fee to be paid by each successful applicant for a conditional Category 1, a Category 1 or a Category 2 license in the amount of $50,000,000 and deposited in the State Gaming Fund. No fee shall be imposed by the board for a Category 1 license if the applicant has paid a $50,000,000 fee for a conditional Category 1 license.

(b)  Term.--A slot machine license, after payment of the fee, shall be in effect unless suspended, revoked or not renewed by the board upon good cause consistent with the license requirements as provided for in this part. Slot machine licensees shall be required to update the information in their initial applications annually, and the license of a licensee in good standing shall be renewed every five years. Nothing in this subsection shall relieve a licensee of the affirmative duty to notify the board of any changes relating to the status of its license or to any other information contained in the application materials on file with the board. As to the renewal of a license, except as required in subsection (f)(3), no additional license fee pursuant to subsection (a) shall be required.

(c)  Credit against tax for slot machine licensees.--If the rate of the tax imposed by section 1403 (relating to establishment of State Gaming Fund and net slot machine revenue distribution) is increased at any time during the term of ten years following the initial issuance of the slot machine license, the slot machine licensee shall be entitled to a credit against subsequent payment of the tax equal to the difference between the tax calculated at the rate when the license was issued and the tax calculated at the increased rate. This credit shall be applied on a dollar-for-dollar basis as and when the tax is payable as set forth in section 1403 but shall not extend beyond the ten-year period following the initial issuance of the license. The aggregate amount of all credits provided shall not exceed the amount of the licensing fee paid by the licensee. The department shall enter into a contract with each slot machine licensee explicitly setting forth the terms and conditions of this credit and which also specifically incorporates the requirements of subsection (f).

(d)  Deposit of license fee.--The total amount of all license fees imposed and collected by the board under this section shall be deposited in the State Gaming Fund.

(e)  Change of ownership or control of a license.--In the event that the ownership or control of a slot machine licensee or its affiliate, intermediary, subsidiary or holding company is changed as described in section 1328 (relating to change in ownership or control of slot machine licensee), the new owner shall be entitled to the full remaining amount of the credit set forth in subsection (c) or the return of the license fee in accordance with subsection (f) as if the new owner or controlling interest was the original licensee.

(f)  Return of slot machine license fee.--

(1)  The entire one-time slot machine license fee of $50,000,000 for each Category 1 and Category 2 slot machine license shall be returned to each licensee in the event section 1201 (relating to Pennsylvania Gaming Control Board established), 1202 (relating to general and specific powers) or 1307 (relating to number of slot machine licenses) is amended or otherwise altered by an act of the General Assembly, within five years following the date established by the board as the deadline for the initial submission of Category 1 and Category 2 slot machine license applications, to change:

(i)  the composition of the board;

(ii)  the number or voting powers of members of the board;

(iii)  the manner in which members are nominated or appointed to the board;

(iv)  the length of term for which each member serves;

(v)  the general jurisdiction of the board in a manner that impairs or otherwise reduces the board's licensing authority; or

(vi)  section 1307 to increase the statutory maximum number of permissible Category 1 or Category 2 licensed facilities.

(2)  In the event that the General Assembly acts in the manner described in paragraph (1):

(i)  In the sixth year following the date established by the board as the deadline for the initial submission of Category 1 and Category 2 slot machine license applications, a Category 1 and Category 2 slot machine licensee shall be entitled to a partial return of the one-time slot machine license fee in the amount of $41,666,667.

(ii)  In the seventh year, each Category 1 and Category 2 slot machine licensee shall be entitled to a partial return of the one-time slot machine license fee in the amount of $33,333,334.

(iii)  In the eighth year, each Category 1 and Category 2 slot machine licensee shall be entitled to a partial return of the one-time slot machine license fee in the amount of $25,000,000.

(iv)  In the ninth year, each Category 1 and Category 2 slot machine licensee shall be entitled to a partial return of the one-time slot machine license fee in the amount of $16,666,668.

(v)  In the tenth year, each Category 1 and Category 2 slot machine licensee shall be entitled to a partial return of the one-time machine license fee in the amount of $8,333,334.

(2.1)  In the event that the General Assembly acts in the manner described in paragraph (1) after the expiration of ten years, Category 1 and Category 2 slot machine licensees shall not be entitled to a return of any portion of the one-time slot machine license fee. Notwithstanding the foregoing, no slot machine licensee shall be entitled to the return of any portion of the fee as a result of any act of the General Assembly insofar as it implements a recommendation made by the board pursuant to a qualified majority vote. In the event a full or partial return of the slot machine license fee imposed pursuant to subsection (a) becomes due pursuant to this subsection, the amount to be returned to any slot machine licensee shall be reduced on a dollar-for-dollar basis by the total accumulated tax credits granted to such licensee pursuant to subsection (c). In no event shall the total amount of the slot machine license fee returned to a Category 1 or Category 2 licensee, combined with the total tax credits granted, exceed the amounts set forth in this subsection for any licensee. The total or partial return of the slot machine license fee shall extinguish a licensee's right to claim any further tax credits pursuant to subsection (c) and to make any future claim for the return of the slot machine license fee.

(3)  Within ten days following a determination that a slot machine licensee is entitled to the return of any portion of the slot machine license fee paid by the slot machine licensee based on the provisions of this section or based on the contract executed by the slot machine licensee and the department under subsection (c), the board shall immediately assess a one-time slot machine license renewal fee on the slot machine licensee in an amount equal to the amount of the fee returned to the slot machine licensee. The renewal fee shall be paid by the slot machine licensee within two business days following the return of the initial fee.

04c1209v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsecs. (a) and (b).

2010 Amendment.  Act 1 amended subsecs. (b) and (f).

Cross References.  Section 1209 is referred to in sections 1208, 1305, 1305.1, 1305.2, 1313, 1315, 1326.1, 1328, 13A12, 1902 of this title; section 9352 of Title 3 (Agriculture).

04c1210s

§ 1210.  Number of slot machines.

(a)  Initial complement.--Except as provided for Category 3 slot machine licensees under section 1305 (relating to Category 3 slot machine license) or a Category 4 slot machine licensee under section 1305.1 (relating to Category 4 slot machine license), the following apply:

(1)  All slot machine licensees shall be permitted to operate up to 3,000 slot machines at any one licensed facility.

(2)  Each slot machine licensee shall be required to operate and make available to play a minimum of 1,500 slot machines at its licensed facility within one year of the issuance by the board of a slot machine license to the slot machine licensee. The board, upon application and for good cause shown, may grant an extension for an additional period ending on the later of 36 months from the end of the initial one-year period or December 31, 2012.

(3)  A Category 1 or Category 2 slot machine licensee that is also a Category 4 slot machine licensee may, upon notification and receipt of approval from the board, install and operate slot machines from the initial complement authorized under paragraph (1) subject to the limitation under section 1305.1(d)(1) at the licensee's Category 4 licensed facility.

(b)  Additional slot machines.--Except as provided for Category 3 slot machine licensees under section 1305, six months following the date of commencement of slot machine operations, the board may permit a slot machine licensee to install and operate up to 2,000 additional slot machines at its licensed facility, beyond those machines permitted under subsection (a), upon application by the slot machine licensee. The board, in considering such an application, shall take into account the appropriateness of the physical space where the additional slot machines will be located and the convenience of the public attending the facility. The board may also take into account the potential benefit to economic development, employment and tourism, enhanced revenues to the Commonwealth and other economic indicators it deems applicable in making its decision. Subject to the limitation under section 1305.1(d), slot machines approved under this subsection may be installed and operated at a Category 4 licensed facility.

(c)  Limitation.--(Deleted by amendment).

04c1210v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

Cross References.  Section 1210 is referred to in sections 1305, 1305.1 of this title.

04c1211s

§ 1211.  Reports of board.

(a)  Report of board.--Eighteen months after the effective date of this part and every year on that date thereafter, the board shall issue a report to the Governor and each member of the General Assembly on the general operation of the board and each slot machine licensee's performance, including, but not limited to, number and win per slot machine and total gross terminal revenue at each licensed facility during the previous year, all taxes, fees, fines and other revenues collected and, where appropriate, disbursed, the costs of operation of the board, all hearings conducted and the results of the hearings and other information that the board deems necessary and appropriate.

(a.1)  Additional reporting requirements.--No later than 12 months after the effective date of Chapter 13A (relating to table games) and every year thereafter, the annual report submitted by the board shall include information on the conduct of table games as follows:

(1)  Total gross table game revenue.

(2)  The number and win by type of table game at each licensed facility during the previous year.

(3)  All taxes, fees, fines and other revenue collected and where appropriate revenue disbursed during the previous year. The department shall collaborate with the board to carry out the requirements of this paragraph.

(4)  Other information related to the conduct of table games.

The board may require certificate holders to provide information to the board to assist in the preparation of the report.

(a.2)  Facility responsibility.--Each Category 1 licensed facility shall provide:

(1)  An annual report to the board and to the respective racing commission summarizing how the introduction and expansion of gaming has fulfilled the intent of this part to enhance live racing at the licensed racetrack.

(2)  Plans to promote live racing and increase live handle and daily attendance at the licensed racetrack in the upcoming year.

(a.3)  Expenses.--Beginning 30 days after the effective date of this subsection, the board shall post, within 45 days after the end of each month on its Internet website, a list of all the itemized expenses of employees and members for that month that were or are to be reimbursed from the assessments made by the department under section 1402(a) (relating to gross terminal revenue deductions) and all itemized expenses of employees of the department and the Office of Attorney General and troopers and employees of the Pennsylvania State Police for the preceding month that were or are to be reimbursed from such assessments. The list shall identify the nature of the expense, the employee, member or the agency and employee of the agency to which an expense is attributable. If the expense is directly attributable to or paid by a licensed gaming entity, the list shall identify the licensed gaming entity and if the expense was charged to the licensed gaming entity. By October 1 of each year, a final report of all expenses described in this subsection for the preceding fiscal year shall be posted on the board's Internet website and shall be submitted 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. Information posted on the Internet website pursuant to this subsection shall be financial records for the purposes of and subject to redaction under the act of February 14, 2008 (P.L.6, No.3), known as the Right-to-Know Law. The board, the department, the Office of Attorney General and the Pennsylvania State Police shall collaborate to develop a uniform system that will enable the board to carry out the requirements of this subsection.

(a.4)  Interactive gaming reporting requirements.--

(1)  The annual report submitted by the board in accordance with subsection (a) shall include information on the conduct of interactive games as follows:

(i)  Total gross interactive gaming revenue.

(ii)  The number and win by type of authorized interactive game at each licensed facility conducting interactive gaming during the previous year.

(iii)  All taxes, fees, fines and other revenue collected and, where appropriate, revenue disbursed during the previous year related to interactive gaming activities. The department shall collaborate with the board to carry out the requirements of this subparagraph.

(2)  The board may require interactive gaming certificate holders and interactive gaming operators to provide information to the board to assist in the preparation of the report.

(b)  Report of the Legislative Budget and Finance Committee.--No later than March 15 of the year following the effective date of this part and each March 15 thereafter, the Legislative Budget and Finance Committee shall issue a report to the General Assembly analyzing the impact, if any, of this part on the State Lottery.

(c)  Interception of gaming winnings.--The board shall conduct a study to determine the feasibility of implementing methods for the interception of the gaming winnings of individuals who are delinquent support obligors or tax delinquent. The study shall be completed by December 31, 2006, and shall contain recommendations which the board determines appropriate.

(d)  Reports to General Assembly.--The board shall conduct an ongoing review of the operation of this part and the impact of gaming in this Commonwealth, including review of other jurisdictions, Federal laws, academic research and public input. The board shall submit an annual report to the General Assembly by December 30. The report shall include recommendations for changes to this part or in the operation or regulation of licensed entities. The report shall be submitted to the Majority Leader and Minority Leader of the Senate and the Majority Leader and Minority Leader of the House of Representatives and the chair and minority chair of the standing committees in the Senate and the chair and minority chair of the standing committees in the House of Representatives with jurisdiction over the board. The report shall be posted by the board on its Internet website.

(d.1)  Impact of interactive gaming.--

(1)  Commencing one year after the issuance of the first interactive gaming certificate and continuing annually thereafter, the Department of Drug and Alcohol Programs or successor agency shall prepare and distribute a report to the Governor and the standing committees of the General Assembly with jurisdiction over the board on the impact of interactive gaming on compulsive and problem gambling and gambling addiction in this Commonwealth. The report shall be prepared by a private organization or entity with expertise in serving and treating the needs of persons with compulsive gambling addictions, which organization or entity shall be selected by the Department of Drug and Alcohol Programs or successor agency. The report may be prepared and distributed in coordination with the board. Any costs associated with the preparation and distribution of the report shall be borne by all interactive gaming certificate holders. The board shall be authorized to assess a fee against each interactive gaming certificate holder for these purposes.

(2)  Commencing one year after the issuance of the first interactive gaming certificate and continuing annually thereafter, the board shall prepare and distribute a report to the Governor and the standing committees of the General Assembly with the jurisdiction over the board on the impact of interactive gaming on licensed gaming entities in this Commonwealth.

(d.2)  Additional information for annual report.--

(1)  One year after the commencement of casino simulcasting in accordance with Chapter 13F (relating to casino simulcasting), the operation of skill slot machines, hybrid slot machines and the operation of a multistate wide-area slot machine system, the report required under subsection (a) shall include information related to the following:

(i)  The conduct of casino simulcasting.

(ii)  The operation of skill slot machines and hybrid slot machines.

(iii)  The operation of the multistate wide-area progressive slot machine system.

(2)  Information on revenue, taxes, fees and fines, if any, collected during the preceding calendar year and any other information, data or recommendations related to the conduct of casino simulcasting and the operation of the multistate wide-area progressive slot machine system, skill slot machines and hybrid slot machines as determined by the board.

(d.3)  Study.--The board shall study and annually report to the standing committees of the General Assembly with jurisdiction over the board on developments in gaming technology and the impact, if any, new technologies and expansion of gaming are having or are expected to have on the sustainability and competitiveness of the gaming industry in this Commonwealth. The initial report shall be due one year after the effective date of this subsection. Each report shall specifically address the following:

(1)  Awareness and growth, to the extent known, of any unregulated commercial gaming products, such as e-Sports and other such digital-based computer or video technology.

(2)  New gaming products, if any, which have been introduced in other states or jurisdictions.

(3)  Any gaming products which the board may authorize pursuant to its regulatory authority under this part.

(4)  Any legislative or administrative concerns regarding traditional, new or emerging gaming technologies with recommendations regarding resolution of such concerns.

(5)  Any cannibalization from Category 4 slot machine licensees on Category 1, Category 2 or Category 3 slot machine licensees.

(e)  Submission of reports.--Notwithstanding any other provision of this part, all annual reports or studies of the board required to be submitted to the General Assembly under this part after the effective date of this subsection shall be submitted by October 1, 2010, and by October 1 of each year thereafter.

04c1211v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added subsecs. (a.4), (d.1), (d.2) and (d.3).

2010 Amendment.  Act 1 amended subsec. (a) and added subsecs. (a.1), (a.2), (a.3) and (e).

Cross References.  Section 1211 is referred to in sections 315, 13C02, 3306 of this title; section 9311 of Title 3 (Agriculture).

04c1212s

§ 1212.  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. The board shall work to enhance the representation of diverse groups in:

(1)  The ownership of licensed entities in this Commonwealth.

(2)  The ownership of business enterprises associated with or utilized by licensed entities and through the provision of goods and services utilized by slot machine licensees under this part.

(3)  The operation of licensed entities and the conduct of gaming in this Commonwealth by ensuring licensed entities promote the participation of diverse groups by affording equal access to employment opportunities, including key employee, gaming employee and nongaming employee positions.

(4)  The operation of business enterprises associated with or utilized by licensed entities, including business enterprises that provide goods, property and services utilized by slot machine licensees in this Commonwealth, by ensuring these business enterprises promote the participation of diverse groups by affording equal access to employment opportunities.

(5)  The construction, renovation or reconstruction of a licensed facility by ensuring that all contracts and subcontracts to be awarded relating to the construction, renovation or reconstruction of a licensed facility contain adequate provisions ensuring all contractors or subcontractors and assignees will promote the participation of diverse groups in any proposed construction, renovation or reconstruction project by affording equal access to employment opportunities.

(6)  The rendering of professional services to licensed entities by ensuring licensed entities promote the participation of diverse groups by affording equal access to professional service contractual opportunities.

(a.1)  Reports by licensees.--Each slot machine licensee shall submit a quarterly report to the board describing activities undertaken at its licensed facility related to the development and implementation of its diversity plan in accordance with section 1325 (relating to license or permit issuance) during the prior quarter. At a minimum, the quarterly reports shall contain a summary of:

(1)  All employee recruitment and retention efforts undertaken to ensure the participation of diverse groups in employment with the slot machine licensee.

(2)  The total number of hires and employment offers made, including data relating to the race, gender and residence of those hired or offered employment.

(3)  All contracting and subcontracting data involving the slot machine licensee and minority-owned business enterprises and women-owned business enterprises.

(4)  Any other information deemed relevant or necessary by the board to assess the slot machine licensee's diversity plan.

(b)  Annual review.--The board shall conduct an annual  review of each slot machine licensee's activities related to the implementation of its diversity plan in order to evaluate whether the slot machine licensee has taken effective and meaningful action to implement a diversity plan and whether the licensee's plan and any other actions taken have achieved or will achieve the Commonwealth's goal of enhanced representation of diverse groups in the gaming industry as set forth in subsection (a).

(c)  Completion of investigation.--The review required under subsection (b) shall be completed six months following the effective date of this section, if practically possible, and annually thereafter and shall contain recommendations which the board determines appropriate. Each review shall contain, at a minimum, a descriptive summary of the following relating to each slot machine licensee's licensed facility:

(1)  Employee recruitment and retention programs designed to ensure the participation of diverse groups.

(2)  The total number of hires and employment offers made, including data relating to the race, gender and residence of individuals hired or offered employment.

(3)  Minority-owned business enterprise and women-owned business enterprise contracting and subcontracting data.

(d)  Facility responsibility.--Each slot machine licensee shall provide information as required by the board to enable the board to complete the reviews required under subsection (b).

(e)  Definition.--As used in this section, the term "professional services" means those services rendered to a slot machine licensee which relate to a licensed facility in this Commonwealth, including, but not limited to:

(1)  Legal services.

(2)  Advertising or public relations services.

(3)  Engineering services.

(4)  Architectural, landscaping or surveying services.

(5)  Accounting, auditing or actuarial services.

(6)  Security consultant services.

(7)  Computer and information technology services, except telephone service.

(8)  Insurance underwriting services.

(9)  Technology related to interactive gaming and interactive gaming devices and associated equipment.

(10)  Technology related to casino simulcasting.

(11)  Technology related to sports wagering.

04c1212v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added subsec. (e)(9), (10) and (11).

Cross References.  Section 1212 is referred to in section 1510 of this title.

04c1213s

§ 1213.  License or permit prohibition.

 The following apply:

(1)  The board shall be prohibited from granting a principal license or a key employee license to an individual  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 any 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 any jurisdiction of a felony offense or of a misdemeanor gambling offense, unless 15 years have elapsed from the date of conviction for the offense.

(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)  Any 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 jurisdiction which, if committed in this Commonwealth, would be subject to imprisonment for more than five years.

04c1213v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  See section 20(1) of Act 1 in the appendix to this title for special provisions relating to applicability.

04c1214s

§ 1214.  Specific authority to suspend slot machine license.

(a)  Conditions.--Any slot machine licensee that is required as a condition of licensure to make payments to a municipality, municipal authority or other entity for an economic development project, including any project enumerated in the act of July 25, 2007 (P.L.342, No.53), known as Pennsylvania Gaming Economic Development and Tourism Fund Capital Budget Itemization Act of 2007, shall, within 30 days of the effective date of this section or within 30 days following licensure, whichever is later, enter into a written agreement with the municipality, municipal authority or other entity. The written agreement shall establish and govern the terms of the required payments, including the amounts of each payment, the date on which each payment shall be made and the duration of the payments.

(b)  Failure to meet conditions.--If a slot machine licensee fails to enter into a written agreement as required by subsection (a), the board may take any action it deems necessary. An action taken by the board shall remain in effect until the slot machine licensee satisfies the board that it has entered into the written agreement required by subsection (a).

(c)  Failure to comply with written agreement.--If a slot machine licensee is in default with respect to a payment obligation contained in a written agreement required by subsection (a), the board may take any action it deems necessary. An action taken by the board shall remain in effect until the slot machine licensee satisfies the board that it is in compliance with the terms of the written agreement.

(d)  Other remedies applicable.--Nothing in this section shall prohibit the board from taking any additional action, including suspension or revocation of the slot machine licensee's license, appointing a trustee under section 1332 (relating to appointment of trustee), or imposing any other sanction permitted by this part against a slot machine licensee who violates the provisions of this section.

04c1214v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 added section 1214.

Cross References.  Section 1214 is referred to in section 13A13 of this title.

04c1301h

 

 

CHAPTER 13

LICENSEES

 

Sec.

1301.  Authorized slot machine licenses.

1302.  Category 1 slot machine license.

1303.  Additional Category 1 slot machine license requirements.

1304.  Category 2 slot machine license.

1305.  Category 3 slot machine license.

1305.1. Category 4 slot machine license.

1305.2. Conduct of auctions.

1306.  Order of initial license issuance.

1307.  Number of slot machine licenses.

1308.  Applications for license or permit.

1309.  Slot machine license application.

1310.  Slot machine license application character requirements.

1311.  Additional slot machine license requirements.

1311.1. Licensing of principals.

1311.2. Licensing of key employees.

1312.  Divestiture of disqualifying applicant.

1313.  Slot machine license application financial fitness requirements.

1314.  Alternative Category 1 licensing standards.

1315.  Conditional Category 1 licenses.

1316.  Bond for issuance of slot machine license.

1317.  Supplier licenses.

1317.1. Manufacturer licenses.

1317.2. Gaming service provider.

1317.3. Nongaming service provider.

1318.  Occupation permit application.

1319.  Alternative manufacturer licensing standards.

1319.1. Alternative supplier licensing standards.

1320.  Slot machine testing and certification standards.

1321.  Additional licenses and permits and approval of agreements.

1322.  Slot machine accounting controls and audits.

1323.  Central control computer system.

1324.  Protocol information.

1325.  License or permit issuance.

1326.  Renewals.

1326.1. Slot machine license operation fee.

1327.  Nontransferability of licenses.

1328.  Change in ownership or control of slot machine licensee.

1329.  Portability and relocation of slot machine license.

1330.  Multiple slot machine license prohibition (Repealed).

1331.  Duty of licensees, key employees and gaming employees.

1332.  Appointment of trustee.

 

Enactment.  Chapter 13 was added July 5, 2004, P.L.572, No.71, effective immediately.

Cross References.  Chapter 13 is referred to in sections 323, 13A28, 13C24, 13F15, 13A28 of this title.

04c1301s

§ 1301.  Authorized slot machine licenses.

Except as provided under section 1305.1 (relating to Category 4 slot machine license), there shall be three distinct classifications of slot machine licenses, designated by category, each permitting a licensed racing entity or person to apply for a qualifying license category and, upon issuance by the board in its discretion, to place and operate slot machines at a licensed facility. Except for conditional Category 1 license applications pursuant to section 1315 (relating to conditional Category 1 licenses), it is mandatory that the board shall consider, approve, condition or deny the approval of all initial applications for each and every category of slot machine licenses collectively and together, in a comprehensive Statewide manner, within 12 months following the time set by the board at which all applications are to be filed and deemed complete by the board. The board shall approve, condition or deny the issuance of a slot machine license of any category within the time period provided for herein. Following approval of an application for a slot machine license, the applicant shall provide formal notification to the board as soon as:

(1)  it fulfills all required conditions for issuance of the license; and

(2)  the board's decision approving the application is a final, binding, nonappealable determination which is not subject to a pending legal challenge.

Upon receipt of such formal notification and upon conducting any necessary verification, the board shall issue a slot machine license to the applicant.

04c1301v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

Cross References.  Section 1301 is referred to in sections 1306, 1315 of this title.

04c1302s

§ 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 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).

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.

(b)  Location.--A Category 1 license may only be issued to an eligible person authorizing slot machine operations at the particular licensed racetrack facility identified in the application. No Category 1 licensed facility shall be located within 20 linear miles of another Category 1 licensed facility.

04c1302v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsec. (a)(4).

Cross References.  Section 1302 is referred to in sections 1303, 1315 of this title.

04c1303s

§ 1303.  Additional Category 1 slot machine license requirements.

(a)  Eligibility.--In addition to the criteria prescribed in section 1302 (relating to Category 1 slot machine license), an applicant for a Category 1 slot machine license shall be eligible for a license to place and operate slot machines at a licensed facility only if the applicant meets one of the following criteria:

(1)  the licensed racing entity or its predecessor owner of the licensed racetrack has conducted live horse races for not less than two years immediately preceding the effective date of this part; or

(2)  the licensed racing entity has not previously conducted live racing at a racetrack but will conduct live racing for a minimum of 150 days to begin in the year which begins two years following the issuance of its slot machine license for the racetrack unless the appropriate commission determines, upon application, that it is not practically feasible for the licensed racing entity to conduct live racing for a minimum of 150 days due to projected or actual weather conditions. Failure to meet the required minimum number of days will result in immediate suspension of the slot machine license.

(b)  Required racing days.--Except as provided in subsection (a)(2), a Category 1 slot machine licensee must conduct live racing at the racetrack for at least 100 days per calendar year for each license held by the licensed racing entity pursuant to the Race Horse Industry Reform Act, and the aggregate number of live racing days at the racetrack where the Category 1 slot machine licensee conducts live racing shall not be less than 95% of the total number of horse or harness racing days that were scheduled in 1986 at that racetrack. If a racing day is canceled for reasons beyond the control of the licensed racing entity, the appropriate commission shall grant the licensee the right to conduct that racing day in the same or next ensuing calendar year. The purse for that racing day shall not be used for the purse of other scheduled racing days of that calendar year and must be used for the purse of such rescheduled day.

(c)  Limitations.--The issuance of a Category 1 slot machine license shall entitle the licensee to operate slot machines only within the grounds of a licensed racetrack.

(d)  Authorization.--Authorization for a Category 1 slot machine licensee to continue the operation of slot machines shall be limited to those licensees that:

(1)  Have a written live racing agreement with a horsemen's organization representing a majority of owners and trainers at the racetrack where the licensed racing entity conducts live racing.

(2)  Have 95% of the total number of horse or harness racing days that were scheduled in 1986 by it or its predecessor at the racetrack where the Category 1 slot machine licensee conducts live racing, and the aggregate number of live racing days at the racetrack where the Category 1 slot machine licensee conducts live racing shall not be less than 95% of the total number of horse or harness racing days that were scheduled in 1986 at that racetrack. A new licensee which opens a new racetrack and which will successfully conduct live racing for a minimum of 150 days to begin no later than in the year which begins two years following the issuance of its slot machine license for the racetrack, unless the appropriate commission determines upon application that it is not practically feasible for the licensed racing entity to conduct live racing for a minimum of 150 days due to projected or actual weather conditions, shall be allowed to operate slot machines, from the date its slot machine license is issued and intrastate and interstate simulcast in accordance with the Race Horse Industry Reform Act, from the first day of the calendar year in which it conducts live racing days.

(3)  Unless the horsemen's organization representing a majority of the owners and trainers consents to a lower number of required racing days at the racetrack, subject to actions or activities beyond the control of the licensee, conduct not fewer than eight live races per race date during each meet at the racetrack where the licensed racing entity conducts live racing, except for thoroughbred tracks on the day designated as a Breeder's Cup event day when the licensed racing entity shall hold a minimum of five live races. The Category 1 slot machine licensee shall not waive or modify the provisions pertaining to the required number of racing days under paragraph (2) and races per day scheduled in this paragraph without the consent of the horsemen's organization representing a majority of owners and trainers at the racetrack.

(4)  Notwithstanding the provisions of paragraph (1), in the event that a written live racing agreement has not been entered into, permission for any licensee to operate slot machines at racetracks shall be granted provided that the Category 1 slot machine licensee has continued to conduct live racing in accordance with paragraphs (2) and (3) and keeps its racetrack open to the general population of owners, trainers and horses stabled there for training and stabling on a regular basis, when it is normally open for live racing and during such periods, and continues to comply with all provisions of the most recently expired live racing agreement, including recognition of the then existing horsemen's organization at each such racetrack as the sole representative of the horsemen at that time, and pays purses as defined in the most recently expired live racing agreement plus the applicable purse revenue distributed to licensed racing entities from the operation of slot machines under this part. Nothing in this part shall exempt an existing or future licensed racetrack from the requirements of the Race Horse Industry Reform Act requiring a licensed corporation to have a written and unexpired live racing agreement with the horsemen's organization representing a majority of owners and trainers at the racetrack where the licensed corporation conducts or will conduct live racing dates in order to continue or commence any form of simulcasting.

(5)  Notwithstanding any other provision of the law to the contrary, account wagers authorized pursuant to section 218(b) of the Race Horse Industry Reform Act shall only be accepted by a licensed corporation in accordance with the provisions of the Race Horse Industry Reform Act, and no entity that is not a licensed corporation under that act shall accept an account wager from any person within this Commonwealth.

04c1303v

 

Cross References.  Section 1303 is referred to in section 1302 of this title; sections 9317, 9329 of Title 3 (Agriculture).

04c1304s

§ 1304.  Category 2 slot machine license.

(a)  Eligibility.--

(1)  A person may be eligible to apply for a Category 2 license if the applicant, its affiliate, intermediary, subsidiary or holding company is not otherwise eligible to apply for a Category 1 license and the person is seeking to locate a licensed facility in a city of the first class, a city of the second class or a revenue- or tourism-enhanced location. It shall not be a condition of eligibility to apply for a Category 2 license to obtain 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.

(2)  If the person seeking a slot machine license proposes to place the licensed facility upon land designated a subzone, an expansion subzone or an improvement subzone under the act of October 6, 1998 (P.L.705, No.92), known as the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act, the person shall, at any time prior to the application being approved, submit a statement waiving the exemptions, deductions, abatements or credits granted under the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act if the board approves the application.

(b)  Location.--

(1)  Two Category 2 licensed facilities and no more shall be located by the board within a city of the first class, and one Category 2 licensed facility and no more shall be located by the board within a city of the second class. No Category 2 licensed facility located by the board within a city of the first class shall be within ten linear miles of a Category 1 licensed facility regardless of the municipality where the Category 1 licensed facility is located. Except for any Category 2 licensed facility located by the board within a city of the first class or a city of the second class, no Category 2 licensed facility shall be located within 30 linear miles of any Category 1 licensed facility that has conducted over 200 racing days per year for the two calendar years immediately preceding the effective date of this part and not within 20 linear miles of any other Category 1 licensed facility. Except for any Category 2 licensed facility located by the board within a city of the first class, no Category 2 licensed facility shall be located within 20 linear miles of another Category 2 licensed facility.

(2)  Within five days of approving a license for an applicant with a proposed licensed facility consisting of land designated a subzone, an expansion subzone or an improvement subzone under the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act for a slot machine license under this section, the board shall notify the Department of Community and Economic Development. The notice shall include a description of the land of the proposed licensed facility which is designated a subzone, an expansion subzone or an improvement subzone. Within five days of receiving the notice required by this paragraph, the Secretary of Community and Economic Development shall decertify the land of the proposed licensed facility as being a subzone, an expansion subzone or an improvement subzone. Upon decertification in accordance with this paragraph and notwithstanding Chapter 3 of the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act, a political subdivision may amend the ordinance, resolution or other required action which granted the exemptions, deductions, abatements or credits required by the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act to repeal the exemptions, deductions, abatements or credits for the land decertified.

(3)  Notwithstanding any other provision of law, the governing body of a city of the first class shall not exempt  from real property taxation or provide any real property tax abatement under the act of December 1, 1977 (P.L.237, No.76), known as the Local Economic Revitalization Tax Assistance Act, to a Category 2 licensed facility located within the city, or any improvements to such facility, unless the owner of the licensed facility enters into or has entered into a tax settlement agreement or payment in lieu of taxes agreement with the city, including any amendments, supplements or modifications of such agreements.

04c1304v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 amended subsec. (b).

Cross References.  Section 1304 is referred to in section 13F02 of this title.

04c1305s

§ 1305.  Category 3 slot machine license.

(a)  Eligibility.--

(1)  A person may be eligible to apply for a Category 3 slot machine license if the applicant, its affiliate, intermediary, subsidiary or holding company has not applied for or been approved or issued a Category 1 or Category 2 slot machine license and the person is seeking to locate a Category 3 licensed facility in a well-established resort hotel having no fewer than 275 guest rooms under common ownership and having substantial year-round recreational guest amenities. The applicant for a Category 3 license shall be the owner or be a wholly owned subsidiary of the owner of the well-established resort hotel. A Category 3 license may only be granted upon the express condition that an individual may not enter a gaming area of the licensed facility if the individual is not any of the following:

(i)  A registered overnight guest of the well-established resort hotel.

(ii)  A patron of one or more of the amenities provided by the well-established resort hotel.

(iii)  An authorized employee of the slot machine licensee, of a gaming service provider, of the board or of any regulatory, emergency response or law enforcement agency while engaged in the performance of the employee's duties.

(iv)  An individual holding a valid membership approved in accordance with paragraph (1.1) or a guest of such individual.

(1.1)  The board may approve a seasonal or year-round membership that allows an individual to use one or more of the amenities provided by the well-established resort hotel holding a Category 3 slot machine license. The membership shall allow the member and one guest to enter the gaming floor at any time as long as the guest is accompanied by the individual owning or holding the membership. The board shall base its approval of a membership on all of the following:

(i)  The duration of the membership.

(ii)  The amenity covered by the membership.

(iii)  Whether the fee charged for the membership represents the fair market value for the use of the amenity.

(1.2)  The requirements under paragraph (1)(i), (ii) and (iii) and the membership fee required under paragraphs (1)(iv) and (1.1) shall not apply to the licensed facility if the Category 3 slot machine licensee makes notification to the board and a payment of $1,000,000 to the department for deposit into the General Fund.

(2)  Notwithstanding section 1512(a) and (a.1) (relating to public official financial interest), if at the time of application an applicant has terminated public office or employment as an executive-level public employee within the last calendar year, the applicant shall be eligible to apply for a slot machine license under this section but may not be issued a license until one year following the date of termination as a public official or executive-level public employee. An application submitted in accordance with this paragraph shall not constitute a violation of section 1512(a) or (a.1).

(3)  If the person seeking a slot machine license proposes to place the licensed facility upon land designated a subzone, an expansion subzone or an improvement subzone under the act of October 6, 1998 (P.L.705, No.92), known as the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act, the person shall, at any time prior to the application being approved, submit a statement waiving the exemptions, deductions, abatements or credits granted under the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act if the board approves the application.

(b)  Location.--The following shall apply:

(1)  Except as provided in paragraph (1.1), no Category 3 license shall be located by the board within 15 linear miles of another licensed facility.

(1.1)  A Category 3 license established on or after July 20, 2017, shall not be located by the board within 30 linear miles of another licensed facility.

(2)  Within five days of approving a license for an applicant with a proposed licensed facility consisting of land designated a subzone, an expansion subzone or an improvement subzone under the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act for a slot machine license under this section, the board shall notify the Department of Community and Economic Development. The notice shall include a description of the land of the proposed licensed facility which is designated a subzone, an expansion subzone or an improvement subzone. Within five days of receiving the notice required by this paragraph, the Secretary of Community and Economic Development shall decertify the land of the proposed license facility as being a subzone, an expansion subzone or an improvement subzone. Upon decertification in accordance with this paragraph and notwithstanding Chapter 3 of the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act, a political subdivision may amend the ordinance, resolution or other required action which granted the exemptions, deductions, abatements or credits required by the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act to repeal the exemptions, deductions, abatements or credits for the land decertified.

(c)  Number of slot machines.--Notwithstanding the number of permissible slot machines as set forth in section 1210 (relating to number of slot machines), a Category 3 license granted under the provisions of this section shall entitle the licensed entity to operate no more than 500 slot machines at the licensed facility, provided, however, a Category 3 slot machine licensee holding a table game operation certificate shall be entitled to operate no more than 600 slot machines at its licensed facility.

(c.1)  Additional slot machines.--

(1)  Upon submission by a Category 3 slot machine licensee of a petition to the board, in such form and manner as the board may require, the board may authorize the Category 3 slot machine licensee to increase the number of slot machines at the Category 3 slot machine licensee's licensed facility.

(2)  An increase in the number of slot machines by a Category 3 slot machine licensee under paragraph (1) may not exceed 250 additional slot machines, which shall be in addition to the number of permissible slot machines authorized under subsection (c).

(d)  Category 3 license fee.--The board shall impose a one-time Category 3 license fee to be paid by each successful applicant in the amount of $5,000,000 to be deposited in the State Gaming Fund. The provisions of section 1209(b), (c), (d) and (e) shall apply to a Category 3 licensee.

(d.1)  Fee for additional slot machines.--Notwithstanding subsection (d), no later than 60 days after the board approves a request for an increase in the number of slot machines submitted by a Category 3 slot machine licensee in accordance with subsection (c.1), the Category 3 slot machine licensee shall pay a one-time fee of $2,500,000 for deposit into the General Fund.

(e)  Definitions.--For the purpose of subsection (a), the following words and phrases shall have the meaning given to them in this subsection:

"Amenities."  Any ancillary activities, services or facilities in which a registered guest or the transient public, in return for non-de minimis consideration as defined by board regulation, may participate at a well-established resort hotel, including, but not limited to, sports and recreational activities and facilities such as a golf course or golf driving range, tennis courts or swimming pool; health spa; convention, meeting and banquet facilities; entertainment facilities; and restaurant facilities.

"Patron of the amenities."  Any individual who is a registered attendee of a convention, meeting or banquet event or a participant in a sport or recreational event or any other social, cultural or business event held at a resort hotel or who participates in one or more of the amenities provided to registered guests of the well-established resort hotel.

04c1305v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added subsecs. (a)(1.2), (c.1) and (d.1).

2010 Amendment.  See section 19.2 of Act 1 in the appendix to this title for special provisions relating to additional applications for Category 3 licenses.

Cross References.  Section 1305 is referred to in sections 1103, 1208, 1209, 1210, 1305.1, 1313, 13F02 of this title.

04c1305.1s

§ 1305.1.  Category 4 slot machine license.

(a)  Eligibility.--The following apply:

(1)  A slot machine licensee may submit a bid if:

(i)  the slot machine licensee's license and table game operation certificate are in good standing with the board; and

(ii)  the slot machine licensee agrees to locate a Category 4 licensed facility as provided under subsection (b).

(2)  A winning bidder of an auction under section 1305.2(a) (relating to conduct of auctions) shall be ineligible to participate in an auction until an auction is conducted under section 1305.2(b) and (b.1).

(a.1)  Municipal option.--

(1)  Prior to the commencement of an auction under section 1305.2, each municipality shall have the option to prohibit the location of a Category 4 licensed facility within the municipality by delivering a resolution of the municipality's governing body to the board no later than December 31, 2017. No Category 4 licensed facility may be located in a municipality which has exercised its option under this paragraph.

(2)  A municipality that prohibits the location of a Category 4 licensed facility within the municipality under paragraph (1) may rescind that prohibition at any time by delivering a new resolution of the municipality's governing body to the board. A municipality that rescinds its prior prohibition according to this subsection may not subsequently prohibit the location of a Category 4 licensed facility in the municipality.

(b)  Location.--The following shall apply:

(1)  Ten Category 4 licensed facilities may be located in this Commonwealth.

(2)  A winning bidder's Category 4 location may not be within 25 linear miles of another Category 1, Category 2 or Category 3 licensed facility but may be within 25 linear miles of the winning bidder's licensed facility.

(3)  After a winning bidder selects a Category 4 location under section 1305.2(c)(9), the selected Category 4 location is reserved and another Category 4 location may not be located within that Category 4 location.

(4)  If the winning bidder applying for a Category 4 slot machine license proposes to place the licensed facility upon land designated a subzone, an expansion subzone or an improvement subzone under the act of October 6, 1998 (P.L.705, No.92), known as the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act, and the application is subsequently approved by the board, the winning bidder shall submit a statement waiving the exemptions, deductions, abatements or credits granted under the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act.

(5)  Within five days of approving a Category 4 slot machine license for a proposed Category 4 licensed facility consisting of land designated a subzone, an expansion subzone or an improvement subzone under the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act for a Category 4 slot machine license under this section, the board shall notify the Department of Community and Economic Development. The notice shall include a description of the land where the proposed Category 4 licensed facility would be situated which is designated a subzone, an expansion subzone or an improvement subzone. Within five days of receiving the notice required by this paragraph, the Secretary of Community and Economic Development shall decertify the land as being a subzone, an expansion subzone or an improvement subzone. Upon decertification in accordance with this paragraph and notwithstanding Chapter 3 of the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act, a political subdivision may amend an ordinance, resolution or other required action which granted the exemptions, deductions, abatements or credits required by the Keystone Opportunity Zone, Keystone Opportunity Expansion Zone and Keystone Opportunity Improvement Zone Act to repeal the exemptions, deductions, abatements or credits for the decertified land.

(6)  A Category 4 slot machine license may not be located in a county hosting a Category 3 licensed facility.

(7)  A Category 4 slot machine license may not be located in a sixth class county which is contiguous to a county that hosts a Category 2 licensed facility.

(c)  Conduct of gaming.--A Category 4 slot machine licensee shall have the authority to install and make slot machines available for play at a Category 4 licensed facility. The holder of a table game certificate that is a Category 4 slot machine licensee may install and make table games available for play at a Category 4 licensed facility.

(d)  Number of slot machines.--The following apply:

(1)  Subject to paragraphs (2) and (3), a Category 4 slot machine licensee may operate not fewer than 300 and not more than 750 slot machines at the Category 4 licensed facility.

(2)  A Category 1 or Category 2 slot machine licensee who is a Category 4 slot machine licensee may not operate slot machines above the authorized complement under section 1210 (relating to number of slot machines).

(3)  (i)  A Category 3 slot machine licensee who is a Category 4 slot machine licensee may submit a petition to operate slot machines above the Category 3 authorized complement under section 1305 (relating to Category 3 slot machine license).

(ii)  No later than 60 days after the board approves a petition to operate slot machines above the Category 3 authorized complement in accordance with subparagraph (i), the Category 3 slot machine licensee shall pay a nonrefundable authorization fee in the amount of $10,000 per authorized additional slot machine.

(iii)  A qualified entity who is a Category 4 slot machine licensee shall submit to the board a petition to operate slot machines not to exceed the limit under paragraph (1). No later than 60 days after the board approves a petition to operate slot machines at a Category 4 licensed facility, the qualified entity must pay a nonrefundable authorization fee in the amount of $10,000 per authorized slot machine.

(4)  A slot machine licensee may not reduce the number of slot machines and table games in operation at a Category 1, Category 2 or Category 3 licensed facility, as of the effective date of this section, unless the board approves of a reduction and the reduction is not a result of the conduct of gaming at a Category 4 licensed facility.

(e)  License fee.--

(1)  The license fee for a Category 4 slot machine license shall be determined pursuant to an auction under section 1305.2.

(2)  An additional license fee for a Category 4 slot machine license shall not be required.

(3)  The provisions of section 1209(c) (relating to slot machine license fee) shall not apply to a Category 4 license.

(f)  Temporary facilities.--The board, in its discretion and upon application or petition, may permit the use of a temporary facility within which slot machines and table games may be made available for play or operation at a Category 4 licensed facility, for a period not to exceed 18 months.

(g)  Pennsylvania State Police.--Notwithstanding section 1517 (relating to investigations and enforcement), the board may not require the Pennsylvania State Police to have an office located within a Category 4 licensed facility.

04c1305.1v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added section 1305.1.

Cross References.  Section 1305.1 is referred to in sections 1209, 1210, 1301, 13F02 of this title.

04c1305.2s

§ 1305.2.  Conduct of auctions.

(a)  Initial auctions.--

(1)  Beginning no later than January 15, 2018, and concluding by July 31, 2018, the board shall conduct initial auctions for the 10 available Category 4 slot machine licenses.

(2)  The board shall set the date, time and location of the initial auctions at least three weeks prior to the initial auction and make the auction information available on the board's publicly accessible Internet website.

(b)  Subsequent auctions.--

(1)  If a winning bid is not awarded at an initial auction conducted under subsection (a), the board shall conduct subsequent auctions.

(2)  A Category 1 or Category 2 slot machine licensee that submitted a winning bid in an initial auction shall be eligible to submit a bid in all subsequent auctions.

(3)  Except as provided under subsection (c)(10)(ii), (11), (12) and (13), the board shall complete all subsequent auctions no later than August 31, 2018.

(b.1)  Additional auctions.--If a subsequent auction fails to generate any bids, the board, in its discretion, may determine if it is in the best interests of the Commonwealth whether to conduct additional auctions at which any Category 1, Category 2 or Category 3 slot machine licensee, or other qualified entity, may bid. If the board intends to conduct additional auctions, the board shall first establish criteria and procedures for the qualification of entities to bid and apply for a Category 4 license.

(c)  Auction procedures.--The following shall apply to the auctions conducted by the board:

(1)  Auctions shall be conducted using a competitive bidding process.

(2)  The board shall adopt procedures to prevent bid rigging and collusion among bidders and establish auction conditions, processes or procedures. The procedures shall not be subject to review under section 205 of the act of July 31, 1968 (P.L.769, No.240), referred to as the Commonwealth Documents Law, sections 204(b) and 301(10) of the act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act, or the act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act.

(3)  The board shall require each prospective bidder to submit a bond or letter of credit in the amount of the minimum bid under paragraph (5).

(4)  Each auction shall be conducted separately.

(5)  The minimum bid shall be $7,500,000. In no case may the board accept a bid that is less than $7,500,000.

(6)  If the auction does not result in a winning bid, the highest bidders shall have one hour to submit a final and best bid to the board at the same public meeting. If the submission of the final bids does not result in a winning bid, the highest bidders shall continue to submit final bids, in an amount not less than or equal to a prior bid submission, until a winning bid is received.

(7)  The winning bidder shall pay to the board the bid amount within two business days following the auction. Payment shall be by cashier's check, certified check or any other method acceptable to the board.

(8)  If the winning bidder does not pay the bid amount within the time period required under paragraph (7), the second highest bidder shall be awarded the right to select a Category 4 location and apply for the Category 4 slot machine license, so long as the second highest bidder's bid amount meets the requirements of paragraph (5). If the second highest bidder declines the award or is ineligible to win, the board shall conduct another auction.

(9)  Upon winning an auction, the winning bidder at the public meeting shall select the Category 4 location at which it intends to operate the Category 4 licensed facility. The board shall post the Category 4 location selection on its publicly accessible Internet website. The selected Category 4 location may not be selected by a subsequent winning bidder.

(10)  (i)  The winning bidder shall submit an application for the Category 4 slot machine license within six months of the payment of the winning bid amount. The board may, in its discretion, extend this deadline for a period not to exceed two additional months.

(ii)  Failure of the winning bidder to submit an application within the time under subparagraph (i) shall result in forfeiture of the bidder's right to apply for the license and forfeiture of the winning bid amount. The board shall conduct another auction at a time determined by the board.

(11)  Issuance of a Category 4 slot machine license by the board to a winning bidder shall be contingent upon the bidder's ability to meet the requirements of this part.

(12)  In the event the board denies the application for the Category 4 slot machine license filed by the winning bidder, the winning bidder shall be entitled to a return of 75% of the winning bid amount the winning bidder submitted under paragraph (7). A refund under this paragraph shall be paid from the General Fund. The board shall conduct another auction at a time determined by the board.

(13)  If the board approves the application for the Category 4 slot machine license filed by the winning bidder and the applicant fails to open and operate the Category 4 licensed facility, the bid amount submitted under paragraph (7) is forfeited. The board shall conduct another auction at a time determined by the board.

(d)  Deposit of fees.--Notwithstanding section 1209 (relating to slot machine license fee), all Category 4 slot machine license auction fees and authorization fees shall be deposited into the General Fund.

04c1305.2v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added section 1305.2.

Cross References.  Section 1305.2 is referred to in sections 1103, 1202, 1208, 1305.1, 1307 of this title.

04c1306s

§ 1306.  Order of initial license issuance.

In order to facilitate the timely and orderly deployment of licensed gaming operations in this Commonwealth, the board shall adopt a schedule by which applicants for slot machine, manufacturer and supplier licenses shall be filed, considered and resolved in accordance with the provisions of this part. In so doing, the board shall consider, approve, condition or deny the approval of all filed applications for manufacturer and supplier licenses as soon as administratively possible and at least three months prior to the board's approval, conditioning or denial of the approval of any Category 1 license application pursuant to section 1315 (relating to conditional Category 1 licenses) or any other category of slot machine license pursuant to section 1301 (relating to authorized slot machine licenses). The board shall ensure that an adequate number of suppliers have been licensed pursuant to section 1301 to meet market demand. The board shall approve, approve with condition or deny all initial applications for conditional Category 1 licenses under section 1315 (relating to conditional Category 1 licenses) prior to considering applications for Category 1, Category 2 or Category 3 slot machine licenses.

04c1306v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

 

Cross References.  Section 1306 is referred to in sections 1317, 1317.1 of this title.

04c1307s

§ 1307.  Number of slot machine licenses.

(a)  Category 1, Category 2 and Category 3 licenses.--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 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 two Category 3 licensed facilities.

(b)  Category 4 licenses.--The board may license no more than 10 Category 4 licensed facilities. The board shall conduct auctions in accordance with section 1305.2 (relating to conduct of auctions).

04c1307v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2010 Amendment.  See section 21(2) of Act 1 in the appendix to this title for special provisions relating to effective date.

Cross References.  Section 1307 is referred to in section 1209 of this title.

04c1308s

§ 1308.  Applications for license or permit.

(a)  Applications.--An application for a license or permit to be issued by the board shall be submitted on a form and in a manner as shall be required by the board. In reviewing applications, the board shall confirm that all the applicable license or permit fees have been paid in accordance with this part.

(a.1)  Submission of information.--An applicant for a license or permit under this part shall disclose in the application all arrests of the applicant and all citations issued to the applicant for nontraffic summary offenses. The information shall include:

(1)  A brief description of the circumstances surrounding the arrest or issuance of the citation.

(2)  The specific offense charged.

(3)  The ultimate disposition of the charge, including the details of any dismissal, plea bargain, conviction, sentence, pardon, expungement or order of Accelerated Rehabilitative Disposition.

No applicant shall be required to provide documentation relating to any summary offense. Failure of the bureau to recover records of a summary offense shall not be grounds for denying an application.

(b)  Completeness of applications.--The board shall not consider an incomplete application and shall notify the applicant in writing if an application is incomplete. An application shall be considered incomplete if it does not include all applicable fees and all information and accompanying documentation required by the board, including, but not limited to, a current tax lien certificate issued by the department at the time of filing the application. Any unpaid taxes identified on the tax lien certificate shall be paid before the application is considered complete. A notification of incompleteness shall state the deficiencies in the application that must be corrected prior to consideration of the merits of the application.

(c)  Adverse litigation.--Notwithstanding any law to the contrary, the board and the commissions shall not consider any application for a license if the applicant or any person affiliated with or directly related to the applicant is a party in any ongoing civil proceeding in which the party is seeking to overturn or otherwise challenge a decision or order of the board or commissions pertaining to the approval, denial or conditioning of a license to conduct thoroughbred or harness horse race meetings respectively with pari-mutuel wagering or to operate slot machines. This subsection shall not be interpreted to affect the rights of applicants to seek judicial enforcement of mandatory obligations of the board as may be required by this part.

04c1308v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 added subsec. (a.1).

Cross References.  Section 1308 is referred to in sections 1206, 1310, 1604 of this title.

04c1309s

§ 1309.  Slot machine license application.

(a)  General requirements.--In addition to any other information required under this part or as may be required by the board, the application for any category of slot machine license shall include at a minimum:

(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 any additional financial information required by the board.

(2)  The proposed location of the slot machine areas, if known.

(3)  The number of slot machines requested.

(4)  A current tax lien certificate issued by the department.

(5)  In those instances where additional slot machines are being requested, the justification and explanation for the number and proposed location of the slot machine areas within the confines of the licensed facility.

(6)  The current status of the horse or harness racing license issued pursuant to the Race Horse Industry Reform Act, if any.

(7)  The details of any gaming, slot machine or casino license applied for, granted to or denied to the applicant by other jurisdictions where such form of gaming is legal, and the consent for the board to acquire copies of applications submitted or licenses issued in connection therewith.

(8)  The details of any loans obtained from a financial institution or not obtained from a financial institution.

(9)  The consent to conduct a background investigation by the board, the scope of which 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.

(10)  Any other information determined to be appropriate by the board.

(a.1)  Table games and interactive gaming information.--

(1)  An applicant for a slot machine license may submit with its application all information required under Chapter 13A (relating to table games) and request that the board consider its application for a slot machine license and a table game operation certificate concurrently. All fees for a table game operation certificate shall be paid by the applicant in accordance with section 13A61 (relating to table game authorization fee).

(2)  The board shall permit any applicant for a slot machine license that has an application pending before the board on the effective date of this subsection to supplement its application with all information required under Chapter 13A and to request that the board consider its application for a slot machine license and a table game operation certificate concurrently. All fees for a table game operation certificate shall be paid by the applicant in accordance with section 13A61.

(3)  The board may permit an applicant for a slot machine license that has an application under paragraph (1) or (2) pending before the board to supplement its application with all information required under Chapter 13B (relating to interactive gaming) and to request that the board consider its application for a slot machine license, a table game operation certificate and an interactive gaming certificate concurrently. All fees for an interactive gaming certificate shall be paid by the applicant in accordance with the requirements of this part.

(b)  Refusal to cooperate.--Any refusal to provide the information required under this section or to consent to a background investigation shall result in the immediate denial of a license or permit.

04c1309v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended the heading of subsec. (a.1) and added subsec. (a.1)(3).

2010 Amendment.  Act 1 added subsec. (a.1).

2006 Amendment.  Act 135 amended subsec. (a)(1).

04c1310s

§ 1310.  Slot machine license application character requirements.

(a)  Application.--

(1)  Every application for a slot machine license shall include such information, documentation and assurances as may be required to establish by clear and convincing evidence the applicant's suitability, including good character, honesty and integrity. Information 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 ten-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 and considered by the board as part of the review of the applicant's suitability under paragraph (1).

(b)  Civil judgments and law enforcement agency information.--Each applicant shall notify the board of any civil judgments obtained against the applicant pertaining to antitrust or security regulation laws of the Federal Government, this Commonwealth or any other state, jurisdiction, province or country. In addition, each applicant shall produce a letter of reference from law enforcement agencies having jurisdiction in the applicant's place of residence and principal place of 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. If no letters are 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.

(c)  Gaming or casino enforcement agency information.--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 which shall specify the experiences of that agency with the applicant, the applicant's associates and the applicant's gaming operation. If no letters are 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.

(d)  Agency records.--Each applicant for a slot machine license, principal license or key employee license shall be required to apply to each Federal agency deemed appropriate by the 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. The board may issue a license to the applicant prior to the receipt of information under this subsection.

04c1310v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

Cross References.  Section 1310 is referred to in sections 1206, 1311, 1312 of this title.

04c1311s

§ 1311.  Additional slot machine license requirements.

(a)  Additional eligibility requirements.--In order to be eligible for a slot machine license under this part, the principals and key employees of the applicant shall obtain a license to meet the character requirements of section 1310 (relating to slot machine license application character requirements) or other eligibility requirements established by the board.

(b)  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 which the board considers appropriate for review under section 1310.

(c)  Related entities.--

(1)  Except as provided in paragraph (2), no person shall be eligible to receive a slot machine license unless the principals and key employees of each intermediary, subsidiary or holding company of the person meet the requirements of subsection (a).

(2)  The board may require that lenders and underwriters of intermediaries, subsidiaries or holding companies of a slot machine license applicant meet the requirements of subsection (a) if the board determines that the suitability of a lender or underwriter is at issue and is necessary to consider a pending application for a slot machine license.

(d)  Revocable privilege.--The issuance or renewal of a license, permit or other authorization by the board under this section shall be a revocable privilege.

(e)  Waiver for publicly traded corporations.--The board may waive the requirements of subsection (a) 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 is not significantly involved in the activities of the corporation and does not have the ability to control the corporation or elect one or more directors thereof.

(f)  Waiver for subsidiaries.--If the applicant is a subsidiary, the board may waive the requirements of subsection (a) 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.

(g)  Ongoing duty.--A person applying for a license, permit or other authorization under this part shall have the continuing duty to provide information required by the board or the bureau and to cooperate in any inquiry or investigation.

(h)  Criminal history record check.--The board shall conduct a criminal history record check on any person for whom a waiver is granted under this section.

04c1311v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

04c1311.1s

§ 1311.1.  Licensing of principals.

(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 slot machine 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.

(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)  Any 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.

04c1311.1v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

 

2006 Amendment.  Act 135 added section 1311.1.

04c1311.2s

§ 1311.2.  Licensing of key employees.

(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 slot machine 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 Commonwealth Photo Imaging Network.

(6)  Details relating to a similar license, permit or other authorization obtained in another jurisdiction.

(7)  Any 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.

04c1311.2v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

 

2006 Amendment.  Act 135 added section 1311.2.

04c1312s

§ 1312.  Divestiture of disqualifying applicant.

In the event that any slot machine 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 section 1310 (relating to slot machine license application character requirements) or any of the eligibility requirements under this part, or a person who purchases a controlling interest in a licensed gaming entity in violation of section 1328 (relating to change in ownership or control of slot machine 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 slot machine license. The board shall approve the terms and conditions of any divestiture under this section. Under no circumstances shall any divestiture be approved by the board if the compensation for the divested interest exceeds the cost of the interest.

04c1313s

§ 1313.  Slot machine license application financial fitness requirements.

(a)  Applicant financial information.--The board shall require each applicant for a slot machine 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. In addition, each applicant shall in writing authorize the examination of all bank accounts and records as may be deemed necessary by the board.

(b)  Financial backer information.--The board shall require each applicant for a slot machine 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. Any such banking or lending institution and institutional investors may be waived from the qualification requirements. A banking or lending institution or institutional investor shall, however, produce for the board upon request any document or information which bears any relation to the proposal submitted by the applicant or applicants. 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. In addition, the applicant shall produce whatever information, documentation or assurances the board requires to establish by clear and convincing evidence the adequacy of financial resources.

(c)  Applicant's ability to pay license fee.--The board shall require each applicant for a Category 1 or 2 slot machine license at the time of application to post a letter of credit or bond in the amount of $50,000,000 to demonstrate the financial ability to pay the slot machine license fee as required in section 1209 (relating to slot machine license fee) if issued a slot machine license by the board. Each applicant for a Category 3 slot machine license at the time of application shall be required to post a letter of credit or bond in the amount of $5,000,000 to demonstrate the financial ability to pay the Category 3 slot machine license fee as required in section 1305 (relating to Category 3 slot machine license) if issued a slot machine license by the board.

(d)  Applicant's business experience.--The board shall require each applicant for a slot machine 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. Applicants shall produce the names of all proposed key employees and a description of their respective or proposed responsibilities as they become known.

(e)  Applicant's operational viability.--In assessing the financial viability of the proposed licensed facility, the board shall make a finding, after review of the application, that the applicant is likely to maintain a financially successful, viable and efficient business operation and will likely be able to maintain a steady level of growth of revenue to the Commonwealth pursuant to section 1403 (relating to establishment of State Gaming Fund and net slot machine revenue distribution). Notwithstanding any provision of this part to the contrary, an applicant that includes a commitment or promise to pay a slot machine license fee in excess of the amount provided in section 1209 or a distribution of terminal revenue in excess of the amounts provided in sections 1403, 1405 (relating to Pennsylvania Race Horse Development Trust Fund) and 1407 (relating to Pennsylvania Gaming Economic Development and Tourism Fund) shall not be deemed a financially successful, viable or efficient business operation and shall not be approved for a slot machine license.

(f)  Additional information.--In addition to other information required by this part, a person applying for a slot machine 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 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.

04c1313v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsec. (e).

04c1314s

§ 1314.  Alternative Category 1 licensing standards.

(a)  Determination.--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 Category 1 slot machine license is similarly licensed are comprehensive and thorough and provide similar adequate safeguards as those required by this part. If the board makes that determination, it may issue a slot machine license to an applicant who holds a slot machine license in such other jurisdiction after conducting an evaluation of the information relating to the applicant from such 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 its evaluation of the applicant.

(b)  Abbreviated process.--In the event an applicant for a slot machine 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. Nothing in this section shall be construed to waive any fees associated with obtaining a license through the normal application process.

04c1315s

§ 1315.  Conditional Category 1 licenses.

(a)  Issuance.--Notwithstanding any provisions of this part to the contrary, upon a finding that it is in the public interest, the board may issue a conditional slot machine license to a person who qualifies as a Category 1 license applicant upon payment of the fee pursuant to section 1209 (relating to slot machine license fee). This license may be issued after the completion of a background investigation of the applicant and each key employee and prior to full compliance by the applicant with section 1325 (relating to license or permit issuance).

(b)  Suitability; financial capability.--An applicant shall provide the board with satisfactory evidence of suitability and financial capability of the applicant to be a slot machine licensee prior to the board granting the conditional license.

(c)  Complete application.--No later than upon issuance of a conditional license, the applicant shall submit a complete application for a Category 1 license pursuant to section 1302 (relating to Category 1 slot machine license) as set forth by this part.

(d)  Expiration.--If the holder of a conditional license does not receive board approval for the issuance of a Category 1 slot machine license under the standards set forth in this part within 18 months from the time set by the board pursuant to section 1301 (relating to authorized slot machine licenses) at which all applications are to be filed and deemed complete, the conditional license shall expire. Failure to meet the requirements of this part for licensure shall cause immediate forfeiture of the conditional slot machine license and revocation of authorization to operate slot machines at the licensed facility.

(e)  Return of fee.--In the event of the expiration of a conditional license or the denial of an application for a slot machine license pursuant to section 1302, the applicant shall be entitled to a return of 85% of the conditional slot machine license fee it submitted with its application.

04c1315v

 

Cross References.  Section 1315 is referred to in sections 1301, 1306 of this title.

04c1316s

§ 1316.  Bond for issuance of slot machine license.

Before any category of slot machine license is issued, the licensee shall post a bond in an amount not less than the sum of $1,000,000, as set by the board, payable to the Commonwealth. The bond shall be used to guarantee that the slot machine licensee faithfully makes the payments, keeps books and records, makes reports and conducts operations in conformity with this part and rules, regulations and orders promulgated by the board. The bond shall not be canceled by a surety on less than 30 days' notice in writing to the board. If a bond is canceled and the slot machine licensee fails to file a new bond with the board in the required amount on or before the effective date of cancellation, the licensee's license shall be revoked or suspended. The total and aggregate liability of the surety on the bond is limited to the amount specified in the bond.

04c1317s

§ 1317.  Supplier licenses.

(a)  Application.--A manufacturer that elects to contract with a supplier under section 1317.1(d.1) (relating to manufacturer licenses) shall ensure that the supplier is appropriately licensed under this section. A person seeking to provide slot machines, table game devices or associated equipment, interactive gaming devices or associated equipment or multi-use computing devices to a slot machine licensee, an interactive gaming certificate holder or an interactive gaming operator within this Commonwealth through a contract with a licensed manufacturer shall 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, accompanied by the application fee, 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 any financial information required by the board.

(1.1)  A statement that the applicant and each affiliate, intermediary, subsidiary or holding company of the applicant are not slot machine licensees.

(1.2)  Proof that the applicant has or will establish a principal place of business in this Commonwealth. A supplier licensee shall maintain its principal place of business in this Commonwealth to remain eligible for licensure.

(2)  The consent to a background investigation of the applicant, its principals and key employees or other persons required by the board and a release to obtain any and all information necessary for the completion of the background investigation.

(3)  The details of any equivalent license granted or denied by other jurisdictions where gaming activities as authorized by this part are permitted and consent for the board to acquire copies of applications submitted or licenses issued in connection therewith.

(4)  The type of goods and services to be supplied and whether those goods and services will be provided through purchase, lease, contract or otherwise.

(5)  Any 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)  The license shall be issued for a period of five years and shall be renewed in accordance with subsection (d). Nothing in this paragraph shall 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.

(3)  Any other condition established by the board.

(c.1)  Abbreviated process.--In the event an applicant for a supplier license to supply table game devices or associated equipment used in connection with table games is licensed by the board under this section to supply slot machines or associated equipment used in connection with slot machines, 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 to supply table game devices or associated equipment used in connection with table games, including financial viability of the applicant. Nothing in this section shall be construed to waive any fees associated with obtaining a license through the normal application process. The board may only use the abbreviated process if all of the following apply:

(1)  The supplier license was issued by the board within a 36-month period immediately preceding the date the supplier licensee files an initial application to supply table game devices or associated equipment.

(2)  The person to whom the supplier license was issued affirms there has been no material change in circumstances relating to the license.

(3)  The board determines, in its sole discretion, that there has been no material change in circumstances relating to the licensee that necessitates that the abbreviated process not be used.

(c.2)  Abbreviated process for supplier.--

(1)  Notwithstanding subsection (c.1)(1) or any regulations of the board to the contrary, the board may extend the use of the abbreviated process authorized under subsection (c.1) to an applicant for a supplier license to supply slot machines used in a multistate wide-area progressive slot machine system, skill slot machines, hybrid slot machines and devices or associated equipment used in connection with multistate wide-area progressive slot machine systems, skill slot machines or hybrid slot machines, interactive gaming devices or associated equipment used in connection with interactive gaming, including multi-use computing devices, if the applicant holds a valid supplier license issued by the board to supply slot machines or associated equipment or table games or table game devices or associated equipment. The requirements of subsection (c.1)(2) and (3) shall apply to this subsection.

(2)  An applicant for a supplier's license to supply slot machines used in a multistate wide-area progressive systems, skill slot machines or hybrid slot machines or associated equipment or interactive gaming devices or associated equipment shall be subject to the applicable provisions of this part.

(d)  Renewal.--

(1)  Six months prior to expiration of a supplier license, the supplier 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 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.

(e)  Prohibitions.--No limitation shall be placed on the number of supplier licenses issued or the time period to submit applications for licensure except as required to comply with section 1306 (relating to order of initial license issuance).

04c1317v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsecs. (a), (c) and (d) and added subsec. (c.2).

Cross References.  Section 1317 is referred to in sections 1208, 1317.1, 1320, 3507, 3513 of this title.

04c1317.1s

§ 1317.1.  Manufacturer licenses.

(a)  Application.--A person seeking to manufacture slot machines, table game devices and associated equipment or interactive gaming devices and associated equipment for use in this Commonwealth shall 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, accompanied by the application fee, 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 any 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 slot machine licensees.

(3)  The consent to a background investigation of the applicant, its principals and key employees or other persons required by the board and a release to obtain any and all 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 and consent for the board to acquire copies of applications submitted or licenses issued in connection therewith.

(5)  The type of slot machines, table game devices or associated equipment or interactive gaming devices or associated equipment to be manufactured or repaired.

(6)  Any 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)  The license shall be issued for a period of five years and shall be renewed in accordance with subsection (d). Nothing in this paragraph shall relieve the licensee of the affirmative duty to notify the board of any changes relating to the status of its license or to any other information contained in application materials on file with the board.

(2)  The license shall be nontransferable.

(3)  Any other condition established by the board.

(c.1)  Abbreviated process.--In the event an applicant for a manufacturer license to manufacture table game devices or associated equipment used in connection with table games is licensed by the board under this section to manufacture slot machines or associated equipment used in connection with slot machines, 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 to manufacture table game devices or associated equipment used in connection with table games, including financial viability of the applicant. Nothing in this section shall be construed to waive any fees associated with obtaining a license, certificate or permit through the normal application process. The board may only use the abbreviated process if all of the following apply:

(1)  The manufacturer license was issued by the board within a 36-month period immediately preceding the date the manufacturer licensee files an application to manufacture table game devices or associated equipment.

(2)  The person to whom the manufacturer license was issued affirms there has been no material change in circumstances relating to the license.

(3)  The board determines, in its sole discretion, that there has been no material change in circumstances relating to the licensee that necessitates that the abbreviated process not be used.

(c.2)  Abbreviated process for manufacturer.--

(1)  Notwithstanding subsection (c.1)(1) or any regulations of the board to the contrary, the board may extend the use of the abbreviated process authorized under subsection (c.1) to an applicant for a manufacturer license to manufacture slot machines used in multistate wide-area progressive slot machine systems, skill slot machines, hybrid slot machines or associated equipment used in connection with multistate wide-area progressive slot machine systems, skill slot machines or hybrid slot machines or interactive gaming devices or associated equipment used in connection with interactive gaming, if the applicant holds a valid manufacturer license issued by the board to manufacture slot machines or associated equipment or table games or table game devices or associated equipment. The requirements of subsection (c.1) (2) and (3) shall apply to this subsection.

(2)  An applicant for a manufacturer license to manufacture slot machines used in a multistate wide-area progressive system, skill or hybrid slot machines or associated equipment or interactive gaming devices or associated equipment shall be subject to the applicable provisions of this part.

(d)  Renewal.--

(1)  Six months prior to expiration of a 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.

(d.1)  Authority.--The following shall apply to a licensed manufacturer:

(1)  A manufacturer or its designee, as licensed by the board, may supply or repair any slot machine, table game device or associated equipment or interactive gaming device or associated equipment manufactured by the manufacturer, provided the manufacturer holds the appropriate manufacturer license.

(2)  A manufacturer of slot machines may contract with a supplier under section 1317 (relating to supplier licenses) to provide slot machines or associated equipment to a slot machine licensee within this Commonwealth, provided the supplier is licensed to supply slot machines or associated equipment used in connection with slot machines.

(3)  A manufacturer may contract with a supplier under section 1317 to provide table game devices or associated equipment to a certificate holder, provided the supplier is licensed to supply table game devices or associated equipment used in connection with table games.

(4)  A manufacturer may contract with a supplier under section 1317 to provide slot machines used in a multistate wide-area progressive system, skill slot machines or hybrid slot machines or associated equipment, interactive gaming devices or associated equipment, provided that the manufacturer is licensed to manufacture slot machines used in a multistate wide-area progressive slot machine system, skill slot machines or hybrid slot machines or associated equipment or interactive gaming devices or associated equipment used in connection with interactive games.

(e)  Prohibitions.--

(1)  No person may manufacture slot machines, table game devices or associated equipment or interactive gaming devices or associated equipment for use within this Commonwealth unless the person has been issued the appropriate manufacturer license under this section.

(2)  Except as permitted in section 13A23.1 (relating to training equipment), no person may use slot machines, table game devices or associated equipment, authorized interactive games or interactive gaming devices or associated equipment unless the slot machines, table game devices or associated equipment, interactive games or interactive gaming devices or associated equipment were manufactured by a person that has been issued the appropriate manufacturer license under this section.

(3)  No person issued a license under this section shall apply for or be issued a license under section 1317.

(4)  No limitation shall be placed on the number of manufacturer licenses issued or the time period to submit applications for licensure, except as required to comply with section 1306 (relating to order of initial license issuance).

04c1317.1v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

Cross References.  Section 1317.1 is referred to in sections 1208, 1317, 13A41, 13C16, 3508, 3512 of this title.

04c1317.2s

§ 1317.2.  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)  The monetary value or amount of business conducted or expected to be conducted by the gaming service provider with an applicant for a slot machine license or a slot machine licensee in any consecutive 12-month period.

(2)  Whether the employees of the gaming service provider will have access to the gaming floor or any gaming-related restricted area of a licensed facility.

(3)  The board's analysis of the goods or services provided or to be provided by the gaming service provider.

(b)  Authority to exempt.--The board may exempt any 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.--Each gaming service 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 any 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 slot machine license or a slot machine 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 slot machine applicant or slot machine 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.

(3)  The gaming service provider applicant agrees in writing that the grant of interim authorization to conduct business prior to board approval of its 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.--The board shall:

(1)  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.

(2)  Develop and maintain a list of prohibited gaming service providers. An applicant for a slot machine license or a slot machine 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.--A slot machine 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 slot machine licensee require immediate action to mitigate damage or loss to the licensee's licensed facility or to the Commonwealth. 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.

04c1317.2v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 added section 1317.2.

Cross References.  Section 1317.2 is referred to in section 342 of this title.

04c1317.3s

§ 1317.3.  Nongaming service provider.

(a)  Notification required.--

(1)  A slot machine licensee or applicant for a slot machine license that contracts with or otherwise engages in business with a nongaming service provider shall provide notification to the board prior to:

(i)  the nongaming service provider's provision of goods or services at the slot machine licensee's licensed facility; or

(ii)  the provision of goods or services for use in the operation of the slot machine licensee's licensed facility.

(2)  Notification under this section shall be on a form and in a manner as determined by the board. The board may impose a fee, not to exceed $100, in connection with the notification.

(b)  Contents of notification.--Notification under this section shall include:

(1)  The name and business address of the nongaming service provider.

(2)  A description of the type or nature of the goods or services to be provided.

(3)  An affirmation from the slot machine licensee or applicant for a slot machine license that the goods or services to be provided by the nongaming service provider will not require access to the gaming floor or a gaming-related restricted area.

(4)  An affirmation from the slot machine licensee or applicant for a slot machine license certifying that the licensee or applicant has performed due diligence regarding the nongaming service provider and believes that neither the nongaming service provider nor its employees will adversely affect the public interest or integrity of gaming.

(5)  Any other information that the board deems necessary.

(c)  Duration of notification.--Subject to subsection (d)(5), the nongaming service provider notification required under subsection (a) shall be valid for five years.

(d)  Conditions.--A slot machine licensee or applicant for a slot machine license that contracts or otherwise engages in business with a nongaming service provider shall be subject to the following conditions:

(1)  The nongaming service provider and its employees shall only provide the goods and services described in the notification under this section.

(2)  The slot machine licensee or applicant for a slot machine license shall notify the board of any material change in the information provided in the notification under this section. No fee shall be required for a subsequent change during the time for which the notification remains valid under subsection (c).

(3)  The slot machine licensee or applicant for a slot machine license shall ensure that employees of the nongaming service provider do not enter the gaming floor or a gaming-related restricted area while providing the goods or services described in subsection (b)(2).

(4)  The slot machine licensee or applicant for a slot machine license shall report to the board an employee of a nongaming service provider that does any of the following:

(i)  Enters the gaming floor or a gaming-related restricted area of the licensed facility.

(ii)  Commits an act that adversely affects the public interest or integrity of gaming.

(5)  The board may prohibit a nongaming service provider or any of its employees from providing goods or services to a slot machine licensee or applicant for a slot machine license at a licensed facility upon a finding by the board that the prohibition is necessary to protect the public interest or integrity of gaming.

(e)  Authority to exempt.--The board may exempt a slot machine licensee or applicant for a slot machine license from the notification requirements of this section if the board determines any of the following:

(1)  The nongaming service provider or the type or nature of the nongaming service provider's business is regulated by an agency of the Federal Government, an agency of the Commonwealth or the Pennsylvania Supreme Court.

(2)  Notification is not necessary to protect the public interest or integrity of gaming.

(f)  (Reserved).

(g)  Criminal history record information.--Notwithstanding any other provision of this part or regulation of the board, a nongaming service provider shall obtain from the Pennsylvania State Police and provide to the board the results of a criminal history record information check under 18 Pa.C.S. Ch. 91 (relating to criminal history record information).

(h)  Emergency notification.--

(1)  A slot machine licensee may use a nongaming service provider prior to the board receiving notification under this section when a threat to public health, welfare or safety exists or circumstances outside the control of the slot machine licensee require immediate action to mitigate damage or loss to the slot machine licensee's licensed facility or to the Commonwealth.

(2)  A slot machine licensee that uses a nongaming service provider in accordance with paragraph (1) shall:

(i)  Notify the board immediately upon engaging a nongaming service provider for which the board has not previously received notification in accordance with subsection (a).

(ii)  Provide the notification required under subsection (a) within a reasonable time as established by the board.

(i)  Nongaming service provider list.--

(1)  The board shall have the authority to prohibit a nongaming service provider from engaging in business with a slot machine licensee upon a finding by the board that the prohibition is necessary to protect the public interest and the integrity of gaming.

(2)  The board shall develop and maintain a list of prohibited nongaming service providers and make it available upon request to a slot machine licensee or an applicant for a slot machine license.

(3)  A slot machine licensee or applicant for a slot machine license may not enter into an agreement or engage in business with a nongaming service provider appearing on the list described in paragraph (2).

(j)  Duties of nongaming service provider.--A nongaming service provider shall:

(1)  Cooperate with the board and bureau regarding an investigation, hearing, enforcement action or disciplinary action.

(2)  Comply with each condition, restriction, requirement, order or ruling of the board issued under this part or regulation of the board.

(3)  Report any change in circumstances to the slot machine licensee or applicant for a slot machine license that may render the nongaming service provider ineligible, unqualified or unsuitable for the provision of goods or services at a licensed facility or use in the operation of a licensed facility. The slot machine licensee or applicant for a slot machine license shall report any change in circumstances to the board in such form and manner as the board may establish.

(k)  Construction.--Nothing in this section shall be construed to limit the powers and authority of the board under section 1202 (relating to general and specific powers) or the regulatory authority of the board under section 1207 (relating to regulatory authority of board).

04c1317.3v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added section 1317.3.

04c1318s

§ 1318.  Occupation permit application.

(a)  Application.--Any person who desires to be a gaming employee and has a bona fide offer of employment from a licensed gaming entity shall apply to the board for an occupation permit. A person may not be employed as a gaming employee unless and until that person holds an appropriate occupation permit issued under this section. 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 permit 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 any occupation permit or similar license granted or denied to the applicant in other jurisdictions and consent for the board to obtain copies of applications submitted or permits or licenses issued in connection therewith.

(7)  Any other information determined by the board to be appropriate.

(c)  Prohibition.--No slot machine licensee may employ or permit any person under 18 years of age to render any service whatsoever in any area of its licensed facility where slot machines or table games are physically located.

04c1318v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 amended subsec. (c).

2006 Amendment.  Act 135 amended subsec. (b)(4).

Cross References.  Section 1318 is referred to in section 1604 of this title.

04c1319s

§ 1319.  Alternative manufacturer licensing standards.

(a)  General rule.--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. If the board makes that determination, it may issue a manufacturer license to an applicant who holds a similar manufacturer license in such other jurisdiction after conducting an evaluation of the information relating to the applicant from such 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 its evaluation of the applicant.

(b)  Abbreviated process.--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. Nothing in this section shall be construed to waive any fees associated with obtaining a license through the normal application process.

04c1319v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

04c1319.1s

§ 1319.1.  Alternative supplier licensing standards.

(a)  General rule.--The board may determine whether the licensing 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. 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.--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. Nothing in this section shall be construed to waive any fees associated with obtaining a license through the normal application process.

04c1319.1v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 added section 1319.1.

04c1320s

§ 1320.  Slot machine testing and certification standards.

(a)  Use of other state standards.--The board may determine, at its discretion, whether the slot machine testing and certification standards of another jurisdiction within the United States in which an applicant for a manufacturer license is licensed are comprehensive and thorough and provide similar adequate safeguards as those required by this part. If the board makes that determination, it may permit a manufacturer through a licensed supplier as provided in section 1317 (relating to supplier licenses) to deploy those slot machines which have met the slot machine testing and certification standards in such other jurisdictions without undergoing the full testing and certification process by a board-established independent facility. In the event slot machines of an applicant for a manufacturer license are licensed in such 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 slot machine certification to such an applicant.

(b)  Facility in Commonwealth.--Within three years immediately following the effective date of this part, the board shall establish and maintain an independent slot machine testing and certification facility. The cost for the establishment and operation of an independent slot machine testing and certification facility shall be paid by each licensed manufacturer in accordance with a schedule adopted by the board. The facility shall be made available to each slot machine manufacturer and supplier as determined by the board.

(b.1)  Use of private testing and certification facilities.--Notwithstanding any other provisions of this part or regulation of the board, if a slot machine is tested and certified by a private testing and certification facility registered with the board, the board shall use an abbreviated certification process requiring only that information determined by it to be necessary to consider the issuance of a slot machine certification under this section. Within one year of the effective date of this subsection, the board shall promulgate regulations that:

(1)  Provide for the registration of private testing and certification facilities. Persons seeking registration under this subsection shall be subject to section 1202(b)(9) (relating to general and specific powers).

(2)  Specify the form and content of the application for registration.

(3)  Establish and collect an application fee for persons seeking registration. The application fee shall include the costs of all background investigations as determined necessary and appropriate by the bureau.

(4)  Establish uniform procedures and standards which private testing and certification facilities must comply with during the testing and certification of slot machines.

(5)  Utilize information provided by private testing and certification facilities for the abbreviated certification of slot machines.

(6)  Establish an abbreviated certification process that may be used by registered private testing and certification facilities to test and certify slot machines.

(7)  Establish fees that must be paid by licensed manufacturers.

(8)  Require slot machines submitted for abbreviated certification to be approved or denied by the board within 30 days from the date of submission to the board. If the board fails to act within the 30-day period, the abbreviated certification shall be deemed conditionally approved.

(9)  Provide procedures and standards for the suspension and revocation of the registration of a private testing and certification facility and the reinstatement of a suspended or revoked registration, as determined appropriate by the board.

(c)  Central control computer compatibility.--The board shall ensure that all slot machines certified and approved for use in this Commonwealth are compatible and comply with the central control computer and protocol specifications approved by the department.

04c1320v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 amended subsec. (a) and added subsec. (b.1).

Cross References.  Section 1320 is referred to in section 13A41 of this title.

04c1321s

§ 1321.  Additional licenses and permits and approval of agreements.

(a)  Requirements.--In addition to the requirements for a license or permit specifically set forth in this part, the board may require a license, permit or other authorization, and set a fee for the same, for any key employee or gaming employee or any person who satisfies any of the following criteria:

(1)  The person transacts business within this Commonwealth with a slot machine licensee as a ticket purveyor, tour operator, operator of a bus trip program or operator of any other type of travel program or promotional business related to slot machines or table games. The board may also review, deny, order modification or approve, at its discretion, proposed tours, bus routes and travel programs.

(2)  The person is presently not required to be licensed or permitted under this part and provides any goods, property or services, including, but not limited to, management  services for compensation to a slot machine licensee at the licensed facility.

(b)  Agreement.--Any agreement to conduct business within this Commonwealth between a person and a slot machine licensee relating to slot machines, table games, table game devices or associated equipment is subject to the approval of the board in accordance with rules and regulations promulgated by the board. Every agreement shall be in writing and shall include a provision for its termination without liability on the part of the slot machine licensee upon a finding by the board that the agreement is not approved or that it is terminated. Failure to expressly include this condition in the agreement is not a defense in any action brought under this section relating to the termination of the agreement.

04c1321v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

04c1322s

§ 1322.  Slot machine accounting controls and audits.

(a)  Approval.--Except as otherwise provided by this part, each slot machine license applicant shall, in addition to obtaining a slot machine license, obtain approval from the board in consultation with the department of its proposed site plans and internal control systems and audit protocols prior to the installation and operation of slot machines at the licensed facility.

(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 slot machines.

(2)  Provide for reliable records, accounts and reports of any financial event that occurs in the operation of a slot machine, including reports to the board related to the slot machines.

(3)  Ensure as provided in section 1323 (relating to central control computer system) that each slot machine directly provides or communicates all required activities and financial details to the central control computer as set by the board.

(4)  Provide for accurate and reliable financial records.

(5)  Ensure any financial event that occurs in the operation of a slot machine is performed only in accordance with the management's general or specific authorization, as approved by the board.

(6)  Ensure that any financial event that occurs in the operation of a slot machine 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.

(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 any 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.--Each slot machine license applicant shall submit to the board and department, in such manner as the board shall require, a description of its administrative and accounting procedures in detail, including its written system of internal control. Each written system of internal control shall include:

(1)  Records of direct and indirect ownership in the proposed slot machine 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 the proposed licensed gaming entity or other competent person and the chief executive officer of the proposed licensed gaming entity or other competent person attesting that the officer believes, in good faith, that the system satisfies the requirements of this section.

(8)  Any other item that the board may require in its discretion.

04c1323s

§ 1323.  Central control computer system.

(a)  General rule.--To facilitate the auditing and security programs critical to the integrity of slot machine gaming in this Commonwealth, the department shall have overall control of slot machines, and all slot machine terminals 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 and shall include real-time information retrieval and terminal activation and disabling programs. The central control computer selected and employed by the department shall not unduly limit or favor the participation of a vendor or manufacturer of a slot machine as a result of the cost or difficulty of implementing the necessary program modifications to communicate with and link to the central control computer. The central control computer employed by the department shall provide:

(1)  A fully operational Statewide slot machine control system that has the capability of supporting up to the maximum number of slot machines that could be permitted to be in operation under this part.

(2)  The employment of a widely accepted gaming industry protocol to facilitate slot machine manufacturers' ability to communicate with the Statewide system.

(2.1)  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 slot machines.

(3)  The delivery of a system that has the capability to support in-house and wide-area progressive slot machines as approved by the board.

(4)  The delivery of a system that allows the slot machine licensee to install independent player tracking systems and cashless technology as approved by the board.

(5)  The delivery of a system that does not alter the statistical awards of slot machine games as designed by the slot machine manufacturer and approved by the board.

(6)  The delivery of a system that provides redundancy so that each component of the network will be 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 any computer system required by the department to operate at a licensed facility, whether independent or as part of the central control computer, shall be paid by the slot machine licensee. The computer system will 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)  Any other capabilities as determined by the department in consultation with the board.

(b)  Personal information.--Except as provided for in subsection (a)(4), the central control computer shall not provide for the monitoring or reading of personal or financial information concerning a patron of a slot machine licensee.

(c)  Initial acquisition of central control computer.--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 any necessary computer hardware, software, licenses or related services shall not be subject to the provisions of 62 Pa.C.S. (relating to procurement). Contracts made pursuant to the provisions of this section shall not exceed five years.

(d)  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.

04c1323v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

 

2006 Amendment.  Act 135 amended subsec. (a).

Cross References.  Section 1323 is referred to in sections 1103, 1322, 3309 of this title.

04c1324s

§ 1324.  Protocol information.

The department shall provide, upon request and in advance of the operation of a central control computer, to a licensed slot machine supplier or manufacturer the comprehensive protocol specifications necessary to enable the respective slot machine suppliers or manufacturers of slot machine terminals to communicate with the department's central control computer for the purpose of transmitting auditing program information and for activating and disabling of slot machine terminals. Manufacturers and suppliers shall be afforded a reasonable period of time to comment upon the protocol in advance of the operation of the central control computer. Once adopted, the department shall provide suppliers and manufacturers a reasonable period of time to review and comment on any changes and on documentation data for all proposed changes to the original protocol specifications of the central control computer. Manufacturers and suppliers shall be afforded a reasonable period of time to comment upon and employ all proposed changes to the protocol in advance of its implementation and operation with the central control computer. Notwithstanding the foregoing, the department may expedite changes in the protocol as may be needed to ensure the integrity and stability of the entire system.

04c1325s

§ 1325.  License or permit issuance.

(a)  Issuance.--In addition to any other criteria provided under this part, any licensed gaming entity, 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 any fee required and upon the fulfillment of any conditions required by the board or provided for in this part. Nothing contained in this part is intended or shall be construed to create an entitlement to a license or permit by any person. The board shall in its sole discretion issue, renew, condition or deny a slot machine license based upon the requirements of this part and whether the issuance of a license will enhance tourism, economic development or job creation is in the best interests of the Commonwealth and advances the purposes of this part.

(b)  Eligibility.--A license or permit shall not be granted or renewed unless the board finds that the applicant satisfies all of the following criteria:

(1)  The applicant has developed and implemented or agreed to develop and implement a 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.

(2)  The applicant in all other respects is found suitable consistent with the laws of this Commonwealth and is otherwise qualified to be issued a license or permit.

(c)  Additional requirements.--In addition to the eligibility requirements otherwise provided in this part, the board may also take into account the following factors when considering an application for a slot machine license:

(1)  The location and quality of the proposed facility, including, but not limited to, road and transit access, parking and centrality to market service area.

(2)  The potential for new job creation and economic development which will result from granting a license to an applicant.

(3)  The applicant's good faith plan to recruit, train and upgrade diversity in all employment classifications in the facility.

(4)  The applicant's good faith plan for enhancing the representation of diverse groups in the operation of its facility through the ownership and operation of business enterprises associated with or utilized by its facility or through the provision of goods or services utilized by its facility and through the participation in the ownership of the applicant.

(5)  The applicant's good faith effort to assure that all persons are accorded equality of opportunity in employment and contracting by it and any contractors, subcontractors, assignees, lessees, agents, vendors and suppliers it may employ directly or indirectly.

(6)  The history and success of the applicant in developing tourism facilities ancillary to gaming development if applicable to the applicant.

(7)  The degree to which the applicant presents a plan for the project which will likely lead to the creation of quality, living-wage jobs and full-time permanent jobs for residents of this Commonwealth generally and for residents of the host political subdivision in particular.

(8)  The record of the applicant and its developer in meeting commitments to local agencies, community-based organizations and employees in other locations.

(9)  The degree to which potential adverse effects which might result from the project, including costs of meeting the increased demand for public health care, child care, public transportation, affordable housing and social services, will be mitigated.

(10)  The record of the applicant and its developer regarding compliance with:

(i)  Federal, State and local discrimination, wage and hour, disability and occupational and environmental health and safety laws; and

(ii)  State and local labor relations and employment laws.

(11)  The applicant's record in dealing with its employees and their representatives at other locations.

(d)  Trusts and similar business entities.--The board shall determine the eligibility of a trust or similar business entity to be a licensed entity in accordance with the following:

(1)  No trust or similar business entity shall be eligible to hold any beneficial interest in a licensed entity under this part unless each trustee, grantor and beneficiary of the trust, including a minor child beneficiary, qualifies for and is granted a license as a principal. The board may waive compliance with this paragraph if the trustee is a banking or lending institution and the board is satisfied that the trustee is not significantly involved in the activities of the licensed entity. In addition to other information required by the board, a banking or lending institution acting as a trustee shall produce at the request of the board any documentation or information relating to the trust.

(2)  No beneficiary of a trust or similar business entity who is a minor child shall control or be significantly involved in the activities of a licensed entity or its holding company or intermediary. No beneficiary of a trust or similar business entity who is a minor child shall be permitted to vote to elect directors of a licensed entity or its holding company or intermediary.

(3)  No trust or similar business entity may hold any beneficial interest in a licensed entity unless the board determines that the trust or similar business entity is not engaged in any activity or otherwise being used to evade the public protections under this part, including sections 1512 (relating to financial and employment interests) and 1513 (relating to political influence).

04c1325v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

 

2006 Amendment.  Act 135 added subsec. (d).

Cross References.  Section 1325 is referred to in sections 1212, 1315, 13F02 of this title.

04c1326s

§ 1326.  Renewals.

(a)  Renewal.--All permits, licenses, registrations or certificates issued under this part unless otherwise provided shall be subject to renewal every five years. Nothing in this subsection shall relieve a licensee, permittee or holder of a certificate or registration of the affirmative duty to notify the board of any changes relating to the status of its license, permit, certificate or registration or to any other information contained in the application materials on file with the board. The application for renewal shall be submitted at least 180 days prior to the expiration of the permit, license, registration or certificate 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 this part. Unless otherwise specifically provided in this part, the amount of any renewal fee shall be calculated by the board to reflect the longer renewal period. A permit, license, registration or certificate for which a completed renewal application and fee, if required, has been received by the board will continue in effect unless and until the board sends written notification to the holder of the permit, license, registration or certificate that the board has denied the renewal of such permit, license, registration or certificate.

(b)  Revocation or failure to renew.--In addition to any other sanctions the board may impose under this part, the board may at its discretion suspend, revoke or deny renewal of any permit, license, registration or certificate issued under this part if it receives any 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 any renewal application is no longer true and correct. In the event of a revocation or failure to renew, the applicant's authorization to conduct the previously approved activity shall immediately cease, and all fees paid in connection therewith shall be deemed to be forfeited. 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.

04c1326v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

Cross References.  Section 1326 is referred to in sections 13B13, 13B14, 13B15, 13C13, 13C14, 13C61, 1518 of this title.

04c1326.1s

§ 1326.1.  Slot machine license operation fee.

(a)  Imposition.--Beginning January 1, 2017, the board shall impose an annual slot machine license operation fee on each Category 1 and Category 2 licensed gaming entity in an amount equal to 20% of the slot machine license fee paid at the time of issuance under section 1209(a) (relating to slot machine license fee).

(b)  Payment of fee.--The department shall develop a payment schedule for the slot machine license operation fee imposed under subsection (a).

(c)  Credit for payment.--The department shall credit against the slot machine license operation fee imposed under subsection (a) any amount paid by a:

(1)  Except as provided in subparagraph (2), Category 1 or 2 licensed gaming entity:

(i)  under section 1403(c)(3) (relating to the establishment of State Gaming Fund and net slot machine revenue distribution) between January 1, 2017, and May 27, 2017; and

(ii)  to a municipality under an agreement between the Category 1 or 2 licensed gaming entity and the municipality in lieu of a payment under section 1403(c)(3), as certified to the department by the municipality receiving the funds.

(2)  Category 2 licensed gaming entity located in a city of the first class:

(i)  under section 1403(c)(2) between January 1, 2017, and May 27, 2017; and

(ii)  to a city of the first class under an agreement between the Category 2 licensed gaming entity and the city in lieu of a payment under section 1403(c)(2), as certified to the department by the city.

(d)  Failure to pay.--The board may at its discretion suspend, revoke or deny a permit or license issued under this part if a Category 1 or Category 2 licensed gaming entity fails to pay the slot machine license operation fee imposed under subsection (a).

(e)  Deposit of slot machine license operation fee.--The total amount of all slot machine license operation fees imposed and collected by the board under this section shall be deposited in the fund and shall be appropriated to the department on a continuing basis for the purposes under section 1403(c)(3) and (4).

04c1326.1v

(Oct. 30, 2017, P.L.419, No.42, eff. imd.)

 

2017 Amendment.  Act 42 added section 1326.1. Section 34(1) of Act 42 provided that the addition of section 1326.1 shall be retroactive to January 1, 2017.

Cross References.  Section 1326.1 is referred to in section 1403 of this title.

04c1327s

§ 1327.  Nontransferability of licenses.

A license or permit issued by the board is a grant of the privilege to conduct a business in this Commonwealth. Except as permitted by section 1328 (relating to change in ownership or control of slot machine licensee), a license or permit granted or renewed pursuant to this part shall not be sold, transferred or assigned to any other person; nor shall a licensee or permittee pledge or otherwise grant a security interest in or lien on the license or permit. Nothing contained in this part is intended or shall be construed to create in any person an entitlement to a license. The board has the sole discretion to issue, renew, condition or deny the issuance of a slot machine license based upon the purposes and requirements of this part.

04c1327v

(Nov. 1, 2006, P.L.1243, No.135, eff. imd.)

04c1328s

§ 1328.  Change in ownership or control of slot machine licensee.

(a)  Notification and approval.--

(1)  A slot machine licensee shall notify the board immediately upon becoming aware of any proposed or contemplated change of ownership of the slot machine licensee by a person or group of persons acting in concert which involves any of the following:

(i)  More than 5% of a slot machine 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 other than in the ordinary course of business of a licensee's assets.

(iv)  Any other transaction or occurrence deemed by the board to be relevant to license qualifications.

(2)  Notwithstanding the provisions of paragraph (1), a slot machine licensee shall not be required to notify the board of any acquisition by an institutional investor pursuant to 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 such 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. Notice to the board and board approval shall be required prior to completion of any proposed or contemplated change of ownership of a slot machine licensee that meets the criteria of this section.

(b)  Qualification of purchaser of slot machine licensee; change of control.--The purchaser of the assets, other than in the ordinary course of business, of any slot machine licensee shall independently qualify for a license in accordance with this part and shall pay the license fee as required by section 1209 (relating to slot machine license fee). A change in control of any slot machine licensee shall require that the slot machine licensee independently qualify for a license in accordance with this part, and the slot machine licensee shall pay a new license fee as required by section 1209, except as otherwise required by the board pursuant to this section. The new license fee shall be paid upon the assignment and actual change of control or ownership of the slot machine license.

(c)  Change in control defined.--For purposes of this section, a change in control of a slot machine licensee shall mean the acquisition by a person or group of persons acting in concert of more than 20% of a slot machine 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 which 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 and/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 thereto 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.

04c1328v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

 

2010 Amendment.  Act 1 amended subsecs. (a)(1) and (b).

Cross References.  Section 1328 is referred to in sections 1209, 1302, 1307, 1312, 1327 of this title.

04c1329s

§ 1329.  Portability and relocation of slot machine license.

(a)  General rule.--Except as otherwise provided in this section, each slot machine license shall only be valid for the specific physical location within the municipality and county for which it was originally granted.

(b)  Petition.--An applicant for a slot machine license or a slot machine licensee may petition the board to relocate its facility. In determining whether to grant a petition to relocate, the board shall:

(1)  Evaluate the proposed new location and the reason for the relocation.

(2)  Conduct an analysis comparing estimated gross terminal revenues and estimated gross table game revenues at the proposed new location with estimated or actual gross terminal revenues and estimated or actual gross table game revenues at the approved current location.

(3)  Conduct an analysis comparing the economic impact of the licensed facility at the proposed new location with the estimated or actual economic impact at the approved current location. The comparative analysis shall include the total cost of the project and projected direct and indirect employment figures.

(4)  Commission a comprehensive traffic study for the proposed new location.

(5)  Evaluate community support or opposition.

(6)  Consider any other information submitted by the petitioner or requested by the board.

(c)  Relocation.--A slot machine licensee may move or relocate the licensed facility with board approval upon good cause shown if the relocation of the licensed facility:

(1)  remains within the same county as when it was originally licensed;

(2)  will facilitate the timely commencement or the continued conduct of gaming operations;

(3)  complies with all other provisions of this part related to the siting and location of a licensed facility; and

(4)  is in the best interests of the Commonwealth.

(d)  Public input hearing.--The board shall hold at least one public input hearing in the municipality where the licensed facility will be located prior to ruling on the petition.

(e)  Restriction.--No grant or loan from the Commonwealth may be awarded for the purpose of relocating or developing the relocated licensed facility to comply with any conditions of approval of the relocation.

04c1329v

(Jan. 7, 2010, P.L.1, No.1, eff. imd.)

04c1330s

§ 1330.  Multiple slot machine license prohibition (Repealed).

04c1330v

 

2017 Repeal.  Section 1330 was repealed Oct. 30, 2017, P.L.419, No.42, effective immediately.

04c1331s

§ 1331.  Duty of licensees, key employees and gaming employees.

Any licensee, key employee or gaming employee shall have the duty to:

(1)  provide any assistance or information required by the board or the Pennsylvania State Police and to cooperate in any inquiry, investigation or hearing;

(2)  consent to inspections, searches and seizures;

(3)  inform the board of any actions which they believe would constitute a violation of this part; and

(4)  inform the board of any arrests for any violations of offenses enumerated under 18 Pa.C.S. (relating to crimes and offenses).

04c1332s

§ 1332.  Appointment of trustee.

(a)  Appointment.--Upon petition of the Office of Enforcement Counsel, the board may appoint a trustee from the list required under subsection (j) to act on behalf of the interests of the Commonwealth and the board to ensure compliance with this part and any conditions imposed upon the slot machine license. A trustee may be appointed only in the following circumstances:

(1)  Upon the revocation, suspension or nonrenewal of a slot machine license or a principal license if the principal licensee is the only principal who exercises operational control of the licensed facility.

(2)  Upon the failure to renew a slot machine license or a principal license if the principal licensee is the only principal who exercises operational control of the licensed facility.

(3)  If necessary to protect the best interests of the Commonwealth.

(b)  Qualifications.--The following shall apply:

(1)  A trustee shall be required to qualify as a principal and obtain a principal license. The board may appoint a trustee and award the trustee a temporary principal license as prescribed in board regulations.

(2)  Before assuming duties, a trustee shall execute and file a bond for the faithful performance of the trustee's duties. The bond shall be payable to the board with sureties and in the amount and form as required by board order. The cost of the bond shall be paid by the former or suspended licensee.

(3)  A trustee shall be a resident of this Commonwealth.

(c)  Powers.--A trustee appointed under this section shall exercise only those powers, duties and responsibilities expressly conferred upon the trustee by the board. The board's order appointing the trustee shall set forth the powers, duties and responsibilities of the trustee which may include:

(1)  Maintaining and operating the licensed facility in a manner that complies with this part and any conditions imposed by the board.

(2)  Maintaining and operating the licensed facility consistent with the measures generally taken in the ordinary course of business including:

(i)  Entering into contracts.

(ii)  Borrowing money.

(iii)  Pledging, mortgaging or otherwise encumbering the licensed facility or property thereof as security for the repayment of loans subject to any provisions and restrictions in any existing credit documents.

(iv)  Hiring, firing and disciplining employees.

(3)  Exercising the rights and obligations of the former or suspended licensee.

(4)  Taking possession of all of the assets of the slot machine licensee, including its books, records and papers.

(5)  Establishing accounts with financial institutions. An account may not be established with a financial institution in which the licensee, an affiliate of the former or suspended licensee, the trustee or an immediate family member of the trustee has a controlling interest.

(6)  Meeting with the former or suspended licensee.

(7)  Meeting with principals and key employees at the licensed facility.

(8)  Meeting with the independent audit committee.

(9)  Meeting with the board's executive director and keeping the board's executive director apprised of actions taken and the trustee's plans and goals for the future.

(10)  Hiring legal counsel, accountants or other consultants or assistants, with prior approval of the board, as necessary to carry out the trustee's duties and responsibilities.

(11)  Settling or compromising with any debtor or creditor of the former or suspended licensee, including any taxing authority.

(12)  Reviewing outstanding agreements to which the former or suspended licensee is a party and advising the board as to which, if any, of the agreements should be the subject of scrutiny, examination or investigation by the board.

(13)  Obtaining board approval prior to any sale, change of ownership, change of control, change of financial status, restructuring, transfer of assets or execution of a contract or any other action taken outside of the ordinary course of business.

(14)  Obtaining board approval for any payments outside of those made in the ordinary course of business.

Notwithstanding any provision contained in this subsection to the contrary, the trustee shall have the duty to conserve and preserve the assets of the licensed gaming entity.

(d)  Compensation.--The board shall establish the compensation of a trustee and shall review and approve actual and reasonable costs and expenses of the trustee, legal counsel, accountants or other consultants or assistants hired by the trustee. The compensation, costs and expenses shall be paid by the former or suspended licensee. Total compensation for the trustee and all persons hired or retained by the trustee under subsection (c)(10) shall not exceed $600 per hour in the aggregate unless otherwise increased by the board pursuant to subsection (d.2).

(d.1)  Calculation of compensation.--In determining the aggregate hourly rate of compensation to be paid to the trustee and all other persons hired or retained by the trustee, the board shall consider:

(1)  The time and labor required, the difficulty of the questions involved and the skill required to properly perform the required services.

(2)  Whether the acceptance of the position by the trustee or other person will preclude the trustee or other person from other employment.

(3)  The fee customarily charged for similar services.

(4)  The nature and potential length of the duties.

(5)  The experience, reputation and ability of the trustee or other person selected to perform the services.

(d.2)  Compensation exceptions.--