H0649B2574A04847 DMS:NLH 12/08/15 #90 A04847
AMENDMENTS TO HOUSE BILL NO. 649
Sponsor: REPRESENTATIVE MUSTIO
Printer's No. 2574
Amend Bill, page 1, line 6, by inserting after "DEFINITIONS;"
providing for video gaming;
Amend Bill, page 39, by inserting between lines 20 and 21
Section 2.1. Title 4 is amended by adding a chapter to read:
CHAPTER 11A
VIDEO GAMING
Sec.
11A01. Definitions.
11A02. Powers and duties.
11A03. Licensing of manufacturers, distributors, terminal
operators and service technicians.
11A04. Video gaming license.
11A05. License prohibitions.
11A06. Video gaming limitations.
11A07. Central computer system.
11A08. Video gaming terminal and redemption terminal.
11A09. Unlawful acts.
11A10. Enforcement.
11A11. Multiple types of licenses prohibited.
11A12. Establishment of account and distribution of funds.
11A13. Initial funding.
11A14. Preemption of local taxes and license fees.
11A15. Exemption from State gaming laws.
11A16. Exemption from Federal regulation.
11A17. Preemption.
11A18. Compulsive and problem gambling.
11A19. Provisional licenses.
11A20. Temporary video gaming regulations.
§ 11A01. 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:
"Central computer system." A central site computer system
controlled by the department and accessible by the board that at
all times is connected to video gaming terminals at licensed
establishments and that, at a minimum, is capable of monitoring,
communicating, auditing, retrieving information, generating
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games, activating and disabling each video gaming terminal.
"Coin-operated amusement game." A machine that requires the
insertion of a coin, currency or token to play or activate a
game, the outcome of which is predominantly and primarily
determined by the skill of the player. The term does not include
a video gaming terminal.
"Department." The Department of Revenue of the Commonwealth.
"Distributor." A person licensed by the board to buy, sell,
lease, service or distribute video gaming terminals. The term
does not include a terminal operator or a manufacturer.
"Enforcement Bureau." The Bureau of Liquor Control
Enforcement of the Pennsylvania State Police.
"Gaming machine." A device or game that has the outcome of
play primarily determined by chance. The term includes an
antique slot machine under 18 Pa.C.S. § 5513(c) (relating to
gambling devices, gambling, etc.) when used for profit. The term
shall not include any of the following:
(1) A coin-operated amusement game.
(2) A video gaming terminal that has all of its seals or
identification plates.
(3) A slot machine as defined under section 1103
(relating to definitions).
(4) A game of chance under the act of December 19, 1988
(P.L.1262, No.156), known as the Local Option Small Games of
Chance Act .
(5) A lottery terminal used under the act of August 26,
1971 (P.L.351, No.91), known as the State Lottery Law .
"Grocery store." A retail establishment, commonly known as a
grocery store, supermarket or delicatessen, where food, food
products and supplies are sold for human consumption on or off
the premises. The term shall include a restaurant with an
interior connection to, and the separate and segregated portion
of, any other retail establishment which is dedicated solely to
the sale of food, food products and supplies for the table for
human consumption on or off the premises.
"Gross revenue." The total of cash or cash equivalents used
for the play of a video gaming terminal minus cash or cash
equivalent paid players as a result of playing a video gaming
terminal.
"Incentive." Any consideration, including a promotion or
prize, provided from a licensee under this chapter or an
employee of a licensee to a patron of a licensed establishment
as an enticement to play a video gaming terminal.
"Inducement." Any consideration paid directly or indirectly,
from a terminal operator, employee of the terminal operator or
any other person on behalf of the terminal operator, to a
licensed establishment owner or an employee of the licensed
establishment, directly or indirectly as an enticement to
solicit or maintain the licensed establishment owner's business.
The term includes cash, a gift, loan and prepayment of gross
revenue.
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"Licensed establishment." A licensed liquor establishment or
a truck stop establishment with a video gaming license granted
under § 11A05 (relating to license prohibitions).
"Licensed liquor establishment." A brew pub, club, hotel,
privately owned public golf course or restaurant as defined or
licensed under the act of April 12, 1951 (P.L.90, No.21), known
as the Liquor Code, that operates under a valid liquor or malt
or brewed beverage license under Article IV of the Liquor Code.
The term shall not include a grocery store or a hotel or
restaurant whose place of business is located in a licensed
facility as defined in 4 Pa.C.S. § 1103 (relating to
definitions).
"Manufacturer." A person that:
(1) is licensed by the board; and
(2) manufactures, produces or assembles video gaming
terminals or major parts and components of video gaming
terminals.
"Minor." An individual who is less than 21 years of age.
"Redemption terminal." The collective hardware, software,
communications technology and other ancillary equipment used to
facilitate the payment of cash or cash equivalent to a player as
a result of playing a video gaming terminal.
"Service technician." An individual licensed by the board to
service, maintain and repair video gaming terminals.
"State Lottery." The lottery established and operated under
the act of August 26, 1971 (P.L.351, No.91), known as the State
Lottery Law .
"Terminal operator." A person that:
(1) is licensed by the board; and
(2) owns, services or maintains video gaming terminals
for placement in licensed establishments.
"Truck stop establishment." A premises that is equipped with
diesel islands used for fueling commercial motor vehicles, has
sold on average 50,000 gallons of diesel or biodiesel fuel each
month for the previous 12 months or is projected to sell an
average of 50,000 gallons of diesel or biodiesel fuel each month
for the next 12 months, has parking spaces dedicated for
commercial motor vehicles, has a convenience store and is
situated on a parcel of land not less than three acres.
"Video gaming license." A license issued by the board
authorizing the placement and operation of video gaming
terminals at the licensed establishment specified in the
application for licensure.
"Video gaming terminal." A device or terminal:
(1) that, upon insertion of a coin or currency, will
play or simulate the play of a video poker, bingo, keno, slot
machine, blackjack or any other game authorized by the board;
(2) that utilizes a video display and microprocessor;
and
(3) in which, by the skill of the player or by chance,
the player may receive a free game or credit that may be
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redeemed for cash at a redemption terminal.
§ 11A02. Powers and duties.
The board shall regulate and adopt standards for video gaming
as authorized under this chapter.
§ 11A03. Licensing of manufacturers, distributors, terminal
operators and service technicians.
(a) Application.--A person that applies to the board for a
manufacturer, distributor, terminal operator or service
technician license related to video gaming under this section
shall do so on a form prescribed by the board.
(b) Application fee.--
(1) An applicant for a manufacturer or distributor
license must pay a nonrefundable application fee of $50,000.
(2) An applicant for a terminal operator license must
pay a nonrefundable application fee of $10,000.
(3) An applicant for a service technician license must
pay a nonrefundable application fee of $100.
(c) Production of information.--An applicant must produce
information, documentation and assurances as required by the
board, including:
(1) Written consent by the applicant to provide for the
examination of financial and business accounts, bank
accounts, tax returns and related records in the applicant's
possession or under the applicant's control that establish
the financial stability, integrity and responsibility of the
license applicant.
(2) Written authorization by the applicant for third
parties in possession or control of accounts or records under
paragraph (1) to allow for examination of such documents as
deemed necessary by the board or the Pennsylvania State
Police in conducting background investigations.
(3) If the applicant has conducted a gaming operation in
a jurisdiction that permits such activity, a letter of
reference from the gaming or casino enforcement or control
agency that specifies the experience of the agency with the
applicant, the applicant's associates and the applicant's
gaming operations. If the applicant is unable to obtain the
letter within 60 days of the request, the applicant may
submit a copy of the letter requesting the information,
together with a statement under oath or affirmation that,
during the period activities were conducted, the applicant
was in good standing with the appropriate gambling or casino
enforcement control agency.
(4) Information, documentation and assurances as
required by the board to establish the applicant's good
character, honesty and integrity. Information under this
paragraph may relate to family, habits, character,
reputation, business affairs, financial affairs, business
associates, professional associates and personal associates,
covering the 10-year period immediately preceding the filing
of the application.
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(d) Background investigation.--Pennsylvania State Police
shall conduct, at the request of the board, a background
investigation of an applicant for a manufacturer, distributor or
terminal operator license as follows:
(1) The applicant shall consent to a background
investigation and provide any and all information requested
by the Pennsylvania State Police and consent to a release of
any and all information necessary for the completion of the
background investigation, which information shall include
fingerprints.
(2) The background investigation shall include a
security, criminal and credit investigation by the
Pennsylvania State Police, which shall include records of
criminal arrests and convictions, in any jurisdiction,
including Federal criminal history record information. The
investigation may utilize information about the applicant
compiled by the Pennsylvania Liquor Control Board. The
Pennsylvania State Police may share investigation information
with the board to the extent permitted by Federal and State
law as determined by the Pennsylvania State Police. None of
the information obtained by the Pennsylvania State Police may
be disclosed publicly nor be subject to disclosure under the
act of February 14, 2008 (P.L.6, No.3), known as the Right-
to-Know Law .
(3) The background investigation shall include an
examination of personal, financial or business records,
including tax returns, bank accounts, business accounts,
mortgages and contracts to which the applicant is a party or
has an interest.
(4) The background investigation shall include an
examination of personal or business relationships that:
(i) Include a partial ownership or voting interest
in a partnership, association or corporation.
(ii) Bear on the fitness of the applicant for
licensure.
(5) The applicant shall reimburse the bureau for the
actual costs of conducting the background investigation. The
board may not approve an applicant that has not fully
reimbursed the Pennsylvania State Police for the
investigation.
(e) Eligibility.--To be eligible for a license under this
section, an applicant for a manufacturer, distributor, terminal
operator or service technician license must comply with all of
the following:
(1) Be of good moral character and reputation in the
community.
(2) Be 18 years of age or older.
(3) Be current in the payment of all taxes, interest and
penalties owed to the Commonwealth and political subdivisions
of the Commonwealth. This paragraph excludes taxes subject to
a timely administrative or judicial appeal or subject to a
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duly authorized deferred payment plan.
(4) An applicant for a manufacturer, distributor or
terminal operator license must also demonstrate sufficient
financial resources to support the activities required of,
respectively, a manufacturer, distributor or terminal
operator related to video gaming terminals.
(f) Review and approval.--The board shall review the
information submitted by the applicant and the investigation
information provided by the Pennsylvania State Police. If being
satisfied that the requirements of subsection (e) have been met,
the board may approve the application and grant the applicant a
manufacturer, distributor or terminal operator license
consistent with all of the following:
(1) The license shall be valid for a period of two
years. Nothing in this paragraph shall be construed to
relieve the licensee of the affirmative duty to notify the
board of any change 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.
(g) Annual fees.--
(1) The annual fee for a terminal operator license shall
be $25,000 for a terminal operator that has placed 50 or
fewer video gaming terminals at licensed establishments in
this Commonwealth. An additional annual fee of $500 shall be
charged per video gaming terminal license for a terminal
operator that has placed more than 50 video gaming terminals
at licensed establishments in this Commonwealth.
(2) The annual fee for a distributor license shall be
$10,000.
(3) The annual fee for a manufacturer license shall be
$10,000.
(4) The annual fee for a service technician license
shall be $100.
(h) Renewal and late filing fees.--
(1) Sixty days prior to expiration of the license, the
licensee seeking renewal of the license shall submit a
renewal application accompanied by the annual fee or the
license shall be subject to appropriate late filing fees.
(2) If the renewal application satisfies the
requirements of subsection (e), the board may renew the
license.
(3) If the board receives a complete renewal application
but fails to act upon the renewal application prior to the
expiration of the license, the license shall continue in
effect for an additional six-month period or until acted upon
by the board, whichever occurs first.
(4) The board may accept renewal applications filed less
than 60 days before the effective date of renewal upon the
payment of the requisite annual fees and an additional late
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filing fee of $100. A renewal application filed on or after
the effective date of renewal shall be accompanied by the
requisite annual fee and an additional late filing fee of
$250. A renewal application may not be considered for
approval unless accompanied by the requisite annual and late
filing fees, tax clearance and any other information required
by the board.
(i) Validation of licenses and late filing fees.--
(1) One year after the issuance or renewal of a license,
the licensee shall file an application for validation of the
license with the requisite annual fees and tax clearance, at
least 60 days before the effective date of the validation or
the license shall be subject to appropriate late filing fees.
(2) The board may accept a validation application filed
less than 60 days before the effective date of renewal upon
the payment of the requisite annual fee and an additional
late filing fee of $100. A validation application filed on or
after the effective date of validation shall be accompanied
by the requisite annual fee and an additional late filing fee
of $250. A validation application may not be considered for
approval unless accompanied by the requisite annual and late
filing fees, tax clearance and any other information required
by the board.
(j) Third-party disclosure.--An applicant must accept any
risk of adverse public notice, embarrassment, criticism, damages
or financial loss, which may result from disclosure or
publication by a third party of material or information
requested by the board pursuant to action on an application. The
applicant expressly must waive a claim against the board or the
Commonwealth and the applicant's employees from damages as a
result of disclosure or publication by a third party.
(k) Hearing upon denial.--A person that is denied a license
or the renewal of a license under this section has the right to
a hearing before the board in accordance with the provisions of
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).
§ 11A04. Video gaming license.
(a) Application.--A person that applies to the board for a
video gaming license under this section shall do so on a form
prescribed by the board.
(b) Licensed liquor establishment.--Except as provided in
section 11A05 (relating to license prohibitions), the board
shall issue a video gaming license to a licensed liquor
establishment upon a showing that the establishment's liquor or
retail dispenser license is valid and is in good standing with
the Pennsylvania Liquor Control Board.
(c) Truck stop establishment.--The board shall issue a
license to a truck stop establishment if the person who owns
establishment meets the following requirements:
(1) Is of good moral character and reputation in the
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community.
(2) Is 18 years of age or older.
(3) Is current in the payment of all taxes, interest and
penalties owed to the Commonwealth and political subdivisions
of the Commonwealth. This paragraph excludes taxes subject to
a timely administrative or judicial appeal or subject to a
duly authorized deferred payment plan.
(4) Demonstrates sufficient financial resources to
support the activities required of a manufacturer,
distributor or terminal operator related to video gaming
terminals.
(5) Produces information, documentation and assurances
as required by the board, including:
(i) Written consent by the applicant to provide for
the examination of financial and business accounts, bank
accounts, tax returns and related records in the
applicant's possession or under the applicant's control
that establish the financial stability, integrity and
responsibility of the license applicant.
(ii) Written authorization by the applicant for
third parties in possession or control of accounts or
records under paragraph (1) to allow for examination of
such documents as deemed necessary by the board or the
Pennsylvania State Police in conducting background
investigations.
(iii) If the applicant has conducted a gaming
operation in a jurisdiction that permits such activity, a
letter of reference from the gaming or casino enforcement
or control agency that specifies the experience of the
agency with the applicant, the applicant's associates and
the applicant's gaming operations. If the applicant is
unable to obtain the letter within 60 days of the
request, the applicant may submit a copy of the letter
requesting the information, together with a statement
under oath or affirmation that, during the period
activities were conducted, the applicant was in good
standing with the appropriate gambling or casino
enforcement control agency.
(iv) The applicant must provide information,
documentation and assurances as required by the board to
establish the applicant's good character, honesty and
integrity. Information under this paragraph may relate to
family, habits, character, reputation, business affairs,
financial affairs, business associates, professional
associates and personal associates, covering the 10-year
period immediately preceding the filing of the
application.
(6) Consent to a background investigation and provide
any and all information requested by the Pennsylvania State
Police and consent to a release to obtain any and all
information necessary for the completion of the background
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investigation, which information shall include fingerprints.
The background investigation shall include the following:
(i) A security, criminal and credit investigation by
the Pennsylvania State Police, which shall include
records of criminal arrests and convictions, in any
jurisdiction, including Federal criminal history record
information. The investigation may utilize information
about the applicant compiled by the Pennsylvania Liquor
Control Board. The Pennsylvania State Police may share
investigation information with the board to the extent
permitted by Federal and State law as determined by the
Pennsylvania State Police. None of the information
obtained by the Pennsylvania State Police shall be
disclosed publicly nor be subject to disclosure under the
act of February 14, 2008 (P.L.6, No.3), known as the
Right-to-Know Law .
(ii) An examination of personal, financial or
business records, including tax returns, bank accounts,
business accounts, mortgages and contracts to which the
applicant is a party or has an interest.
(iii) An examination of personal or business
relationships that include a partial ownership or voting
interest in a partnership, association or corporation and
bear on the fitness of the applicant for licensure.
(iv) The applicant shall reimburse the bureau for
the actual costs of conducting the background
investigation. The board may not approve an applicant
that has not fully reimbursed the Pennsylvania State
Police for the investigation.
(d) Application fee.--A licensed establishment shall pay an
application fee of $100.
(e) Annual fees.--A licensed establishment shall pay an
annual fee of $1,000 and an annual fee of $500 per video gaming
terminal.
(f) Review and approval.--The board shall review the
information submitted by the applicant and, if the applicant is
a truck stop establishment, the investigation information
provided by the Pennsylvania State Police. If satisfied that the
requirements for a video gaming license have been met, the board
shall approve the application and grant the applicant a video
gaming license consistent with all of the following:
(1) The license shall be valid for a period of two
years. Nothing in this paragraph shall be construed to
relieve the licensee of the affirmative duty to notify the
board of any change 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.
(g) Renewal and late filing fees.--
(1) Sixty days prior to expiration of the license, the
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licensee seeking renewal of the license shall submit a
renewal application accompanied by the renewal fee or the
license shall be subject to appropriate late filing fees.
(2) If the renewal application satisfies the
requirements for the video gaming license, the board may
renew the license.
(3) If the board receives a complete renewal application
but fails to act upon the renewal application prior to
the expiration of the license, the license shall continue in
effect for an additional six-month period or until acted upon
by the board, whichever occurs first.
(4) The board may accept a renewal application filed
less than 60 days before the effective date of renewal upon
the payment of the requisite license and filing fee and an
additional late filing fee of $100. A renewal application
filed on or after the effective date of renewal shall be
accompanied by the requisite license and filing fee and an
additional late filing fee of $250. A renewal application may
not be considered for approval unless accompanied by the
requisite annual and late filing fees, tax clearance and any
other information required by the board.
(h) Validation of licenses and late filing fees.--
(1) One year after the issuance or renewal of a license,
the licensee shall file an application for validation of
the license with the requisite annual fees and tax clearance,
at least 60 days before the effective date of the validation
or the license shall be subject to appropriate late filing
fees.
(2) The board may accept a validation application filed
less than 60 days before the effective date of renewal upon
the payment of the requisite annual fee and an additional
late filing fee of $100. A validation application filed on or
after the effective date of validation shall be accompanied
by the requisite annual fee and an additional late filing fee
of $250. A validation application will not be considered for
approval unless accompanied by the requisite filing, license
and late filing fees, tax clearance and any other information
required by the board.
(i) Third-party disclosure.--An applicant must accept any
risk of adverse public notice, embarrassment, criticism, damages
or financial loss, which may result from disclosure or
publication by a third party of material or information
requested by the board pursuant to action on an application. The
applicant expressly must waive a claim against the board or the
Commonwealth and the applicant's employees from damages as a
result of disclosure or publication by a third party.
(j) Hearing upon denial.--A person who is denied a license
or the renewal of a license under this section has the right to
a hearing before the board in accordance with the provisions of
2 Pa.C.S. Chs. 5 Subch. A (relating to practice and procedure of
Commonwealth agencies) and 7 Subch. A (relating to judicial
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review of Commonwealth agency action).
§ 11A05. License prohibitions.
(a) Felony conviction prohibition.--A person that has been
convicted of a felony in any jurisdiction may not be issued a
license under this chapter.
(b) Gambling offense prohibition.--A person that has been
convicted in any jurisdiction of a gambling offense, including a
violation of 18 Pa.C.S. § 5516 (relating to gambling devices,
gambling, etc.), unless 15 years have elapsed from the date of
conviction for the offense, may not be issued a license under
this chapter.
(c) Factors to be considered.--Following the expiration of
any prohibition period applicable to an applicant under
subsection (b), in determining whether to issue a license, the
board shall consider the following factors:
(1) The nature and seriousness of the offense or
conduct.
(2) The circumstances under which the offense or conduct
occurred.
(3) The age of the applicant when the offense or conduct
was committed.
(4) Whether the offense or conduct was an isolated or
repeated incident.
(5) 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.
(d) Felony offenses.--For purposes of this section, a felony
offense is any of the following:
(1) An offense punishable under the laws of this
Commonwealth by imprisonment for more than five years.
(2) An offense which, under the laws of another
jurisdiction, is:
(i) classified as a felony; or
(ii) punishable by imprisonment for more than five
years.
(3) An offense under the laws of another jurisdiction
which, if committed in this Commonwealth, would be subject to
imprisonment for more than five years.
§ 11A06. Video gaming limitations.
(a) General rule.--A licensed establishment shall be subject
to the following limitations:
(1) No more than five video gaming terminals may be
placed on the premises of the licensed establishment.
(2) With the exception of tickets indicating amounts
won, which are redeemable for cash, or which can be
reinserted into video gaming machines for play of games
authorized by the board, no video gaming terminal may
directly dispense a coin, cash, token or anything else of
value. The winning ticket may, however, be used in other
video gaming terminals in the same licensed establishment.
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(3) (i) The licensed establishment must enter into a
written video gaming terminal placement agreement with a
licensed terminal operator for a minimum 60-month term
and a maximum 120-month term. The form of the agreement
shall be approved by the board and on file and available
for inspection at the licensed establishment. A licensed
establishment or licensed establishment applicant, may
only sign, or agree to sign, a written agreement with a
terminal operator or terminal operator applicant.
(ii) Any person soliciting the execution of a video
gaming terminal placement agreement on behalf of an
applicant or licensee shall be disclosed to the board.
(iii) No video gaming terminal placement agreement
may be transferred or assigned unless the individual or
entity making the assignment and the individual or entity
receiving the assignment of the video gaming terminal
placement agreement are both applicants or licensees
under this chapter.
(iv) No payment may be made to an individual or
entity for or with respect to the procurement of a video
gaming terminal placement agreement to an individual or
entity which or whom is not licensed by or disclosed to
the board.
(v) If an application for a terminal operator
license is denied or withdrawn, the video gaming terminal
placement agreement shall be null and void.
(vi) A video gaming terminal placement agreement not
in strict compliance with this section is void.
(4) (i) No video gaming terminal may be in an area
easily accessible to a minor. A floor-to-ceiling wall is
not required.
(ii) The entrance to the video gaming area must be
secure and easily seen and observed by the employees or
management of the licensed establishment.
(iii) The video gaming area must at all times be
monitored by an employee of the licensed establishment,
who is at least 18 years of age, either directly or
through video surveillance.
(5) (i) Except as may be approved by the board, no
licensed establishment with a video gaming license may
generally advertise gaming to the general public.
(ii) A customer of a licensed establishment may opt
in to receive written advertising materials from a
licensed establishment.
(6) No licensed establishment or employee of a licensed
establishment may offer an incentive to a patron of the
licensed establishment related to the play of a video gaming
terminal.
(b) Fines.--A person found in violation of any of the
limitations in subsection (a) shall be subject to the following
fines:
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(1) A fine of not less than $300, nor more than $500 for
the first violation.
(2) For more than one violation or subsequent
violations, a fine of not less than $500, nor more than
$1,000.
(3) The right to suspend and revoke licenses granted
under this chapter shall be in addition to the fines
enumerated in this subsection.
§ 11A07. Central computer system.
The department shall establish and procure a central computer
system capable of monitoring and communicating with each video
gaming terminal. The following shall apply:
(1) All video gaming terminals shall be linked to the
central computer system under the control of the department
and accessible by the board.
(2) The department may utilize the central control
computer system employed by the department to monitor slot
machine gaming or the State Lottery.
(3) All communications data collected by the central
computer system may be provided to the terminal operator.
(4) Interconnection of jackpots, pursuant to a wide area
progressive system, shall be allowed.
§ 11A08. Video gaming terminal and redemption terminal.
(a) Specifications.--
(1) The board shall approve one or more video gaming
terminals and redemption terminals that include hardware and
software specifications. All video gaming terminals and
redemption terminals offered for play or use in this
Commonwealth shall conform to the approved specifications.
(2) The board may utilize the standards and models
approved by other states, and may contract for the services
of the board's testing laboratory.
(b) Service contracts authorized.--The board may also
contract for services of one or more independent outside testing
laboratories that have been accredited by a national
accreditation body and that, in the judgment of the board, are
qualified to perform such examinations and tests.
(c) Contents of specifications.--The specifications shall
include:
(1) All video gaming terminals shall have the ability to
interact with the central communications system.
(2) Unremovable identification plates shall appear on
the exterior of the video gaming terminal containing the name
of the manufacturer and the serial and model number of the
video gaming terminal.
(3) Rules of play shall be displayed on the video gaming
terminal face or screen as promulgated by the board.
(4) A video gaming terminal may not directly dispense
coins, cash, tokens or any other article of exchange or value
except for tickets. Such tickets shall be dispensed by
pressing the ticket dispensing button on the video gaming
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terminal at the end of one's turn or play. The ticket shall
indicate the total amount of the cash award. The player shall
be permitted to insert the ticket into another terminal in
the same licensed establishment or turn in the ticket for
redemption. Redemption shall be made by giving the ticket to
the responsible person in charge who is over 18 years of age
at the licensed establishment or through the use of an
approved redemption machine. A redemption machine is required
at the licensed establishment if the establishment has three
or more terminals.
(5) The cost of a credit shall be 1¢, 5¢, 10¢ or 25¢ and
the maximum wager played per game shall not exceed $2.50. A
game may result in one or more prizes.
(6) No cash award for any individual game may exceed
$1,000.
(7) All video gaming terminals must be designed and
manufactured with total accountability to include gross
proceeds, net profits, winning percentages and any other
information the board requires.
(8) Each video gaming terminal shall pay out a minimum
of 85% of the amount wagered.
§ 11A09. Unlawful acts.
(a) General rule.--It shall be unlawful for any person to do
any of the following:
(1) To operate or attempt to operate a video gaming
terminal or to receive or attempt to receive payment from a
redemption terminal if the person is under 21 years of age.
(2) To permit a person under 21 years of age to play a
video gaming terminal or to provide payment as a result of
playing video gaming to a person under 21 years of age.
(3) To permit a visibly intoxicated person to play a
video gaming terminal.
(4) To possess a gaming machine.
(5) To install or operate more video gaming terminals in
a licensed establishment than permitted by this chapter or
the board.
(6) To tamper with the connection of a video gaming
terminal to the central communications system.
(7) To sell, distribute, service, own, operate or place
on location a video gaming terminal unless the person holds
the appropriate license under this chapter and is in
compliance with all requirements of this chapter.
(8) As a terminal operator, to give, or offer to give,
directly or indirectly, any type of inducement to a licensed
liquor establishment or truck stop establishment to secure a
video gaming terminal placement agreement.
(9) As a licensed liquor establishment or truck stop
establishment, to accept any inducement from a terminal
operator or any other third party, directly or indirectly,
associated with a terminal operator.
(b) Penalties and fines.--In addition to any other penalty
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provided by law, the following shall apply:
(1) A person convicted of violating subsection (a)(1) or
(3) is guilty of a summary offense.
(2) A person convicted of violating subsection (a)(4) is
guilty of a misdemeanor of the first degree and shall be
subject to additional penalties as provided in subsection
(c).
(3) Except for subsection (a)(1), (3) or (4):
(i) A person convicted of violating any other
provision of subsection (a) is guilty of a misdemeanor of
the third degree and shall pay fine of not less than
$5,000.
(ii) A person convicted of violating any other
provision of subsection (a) that is convicted of a second
or subsequent violation is guilty of a misdemeanor of the
second degree and shall pay a fine of not less than
$15,000.
(c) Seizure, forfeiture and destruction of gaming machines
and fines.--
(1) A licensee under this chapter shall consent to
seizure of its gaming machines. Gaming machines and the
proceeds of gaming machines shall be subject to seizure under
sections 1517(e) (relating to investigations and enforcement)
and 1518(f) (relating to prohibited acts; penalties).
(2) In the case of a gaming machine seized from a
licensed establishment:
(i) For a first violation, the penalty shall be a
fine of at least $10,000 and not more than $25,000 and a
suspension of the licensed establishment owner's liquor
license for not less than seven consecutive days.
(ii) For a second or subsequent violation, the
penalty shall be a fine of $50,000 and a suspension of
the liquor license for not less than 60 consecutive days,
or a revocation of the establishment's license.
(3) In the case of a gaming machine seized from a place
of business other than a licensed establishment:
(i) For a first violation, the penalty shall be a
fine of at least $10,000 and not more than $25,000
against the owner of the business from which the gaming
machine was seized, and a suspension of the licensed
establishment owner's liquor license for not less than 30
consecutive days.
(ii) For a second or subsequent violation, the
penalty shall be a fine of $50,000, and a suspension of
the liquor license for not less than 60 consecutive days.
§ 11A10. Enforcement.
In addition to any other law enforcement agency with
jurisdiction, the enforcement bureau shall have the jurisdiction
and the authority to enter a business in order to enforce the
provisions of this chapter.
§ 11A11. Multiple types of licenses prohibited.
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(a) Manufacturer restriction.--A manufacturer may not be
licensed as a video gaming terminal distributor or a terminal
operator, or own, manage or control a licensed establishment,
and shall be licensed only to sell to licensed distributors.
(b) Distributor restriction.--A licensed video gaming
terminal distributor may not be licensed as a manufacturer or a
terminal operator, or own, manage or control a licensed
establishment.
(c) Terminal operator restriction.--A terminal operator may
not be licensed as a manufacturer or distributor and shall be
licensed only to contract with licensed distributors and
licensed establishments.
(d) Licensed establishment restriction.--An owner of a
licensed establishment may not be licensed as a manufacturer,
distributor or terminal operator.
§ 11A12. Establishment of account and distribution of funds.
(a) Video Gaming Account.--The Video Gaming Account is
established as a separate account in the State Treasury. Except
as otherwise provided in this chapter, fees and fines collected
under this chapter and the portion of gross revenue
distributable to the Commonwealth under subsection (c)(3) shall
be deposited in the Video Gaming Account.
(b) Video operator accounts.--A video operator shall
establish and maintain an account in a State depository in this
Commonwealth into which the video operator shall deposit gross
revenue generated by the play of all video gaming terminals for
which the operator has been issued a video operator license. The
sums in the video operator account shall be withdrawn weekly by
the department and deposited as provided in subsection (a).
(c) Distribution of gross revenue.--The gross revenue from
each video gaming terminal shall be distributed in the following
manner:
(1) To the licensed establishment, 33%.
(2) To the terminal operator, 33%.
(3) To the Commonwealth, 34%.
(d) Video Gaming Account appropriations.--
(1) Money from the Video Gaming Account shall be
appropriated to:
(i) The board for its operations related to the
licensing and regulation of video gaming.
(ii) To the department for operation of the central
management system.
(iii) To the bureau for enforcement of this chapter
upon appropriation by the General Assembly.
(2) The board, department and bureau 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 Video
Gaming Account necessary to pay such costs.
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(e) Payments to municipalities.--On an annual basis, each
municipality that has one or more licensed establishments within
the municipality shall be paid $1,000 per licensed terminal
located in the municipality from the Video Gaming Account.
(f) Funding for compulsive gambling programs.--The board
shall allocate from the Video Gaming Account $1,000,000
annually for the purpose of treating compulsive gambling in this
Commonwealth.
§ 11A13. Initial funding.
The sum of $10,000,000 is hereby appropriated from the
General Fund to the board for the purpose of paying costs
associated with the licensing and regulation of video gaming and
the initial implementation of this chapter and other costs
associated with this chapter by the board. The appropriated
amount shall be repaid from the Video Gaming Account to the
General Fund by June 30, 2017.
§ 11A14. Preemption of local taxes and license fees.
(a) Statutes.--Video gaming terminals shall be exempt from
taxes levied under the following:
(1) The act of August 5, 1932 (Sp.Sess., P.L.45, No.45),
referred to as the Sterling Act.
(2) The act of December 31, 1965 (P.L.1257, No.511),
known as The Local Tax Enabling Act .
(3) 53 Pa.C.S. Pt. III Subpt. E (relating to home rule
and optional plan government).
(4) Any statute that confers taxing authority to a
political subdivision.
(b) Licensing fees.--
(1) Video gaming terminals are exempt from local
licensing fees.
(2) Local licensing fees imposed on all other coin-
operated amusement games shall not exceed $100.
§ 11A15. Exemption from State gaming laws.
Video gaming terminals authorized under this chapter and the
use of video gaming terminals as authorized under this chapter
are exempt from 18 Pa.C.S. § 5513 (relating to gambling devices,
gambling, etc.).
§ 11A16. Exemption from Federal regulation.
The General Assembly declares that the Commonwealth is exempt
from section 2 of the Gambling Devices Transportation Act (64
Stat. 1134, 15 U.S.C. § 1172). Shipments of approved video
gaming terminals into this Commonwealth in compliance with
sections 3 and 4 of the Gambling Devices Transportation Act (15
U.S.C. §§ 1173 and 1174) shall be deemed legal shipments into
this Commonwealth.
§ 11A17. Preemption.
This chapter shall preempt all laws of units of local
government to the extent they are inconsistent with this
chapter.
§ 11A18. Compulsive and problem gambling.
(a) Establishment of program.--
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(1) The Department of Health shall develop program
guidelines for public education, awareness and training
regarding compulsive and problem gambling and the treatment
and prevention of compulsive and problem gambling
specifically in the area of video gaming. The program shall
supplement and be complimentary to the existing program under
4 Pa.C.S. § 1509 (relating to compulsive and problem gambling
program).
(2) Except as otherwise provided in this subsection, the
provisions of 4 Pa.C.S. § 1509 shall be fully applicable to
video gaming. The guidelines shall include strategies for the
prevention of compulsive and problem gambling. The Department
of Health may consult with the board and licensed gaming
entities to develop such strategies.
(3) The program shall include the following,
specifically with respect to video gaming:
(i) Maintenance of a compulsive gamblers assistance
organization's toll-free problem gambling telephone
number to provide crisis counseling and referral services
to families experiencing difficulty as a result of
problem or compulsive gambling.
(ii) The promotion of public awareness regarding the
recognition and prevention of problem or compulsive
gambling.
(iii) Facilitation, through in-service training and
other means, of the availability of effective assistance
programs for problem and compulsive gamblers and family
members affected by problem and compulsive gambling.
(iv) Conducting studies to identify adults and
juveniles in this Commonwealth who are, or are at risk of
becoming, problem or compulsive gamblers.
(v) Providing grants to and contracting with
organizations which provide services as provided in this
section.
(vi) Providing reimbursement for organizations for
reasonable expenses in assisting the Department of Health
in carrying out the purposes of this section.
(b) Notice of availability of assistance.--
(1) A licensed establishment shall obtain a toll-free
telephone number to be used to provide persons with
information on assistance for compulsive or problem gambling.
A licensed establishment shall conspicuously post at least
two signs containing language similar to the following
statement: If you or someone you know has a gambling problem,
help is available. Call (toll-free telephone number). The
signs shall be posted within 50 feet of each entrance and
exit and, within 50 feet of each automated video gaming area
within the licensed establishment and in other appropriate
public areas of the licensed establishment as determined by
the licensed establishment.
(2) A licensed establishment shall have available in its
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establishment written handout materials in a format
prescribed by the Department of Health which contain the same
information as the signs referenced in paragraph (1).
(3) A licensed establishment that fails to post or print
the warning sign or provide the written materials in
accordance with paragraph (1) or (2) shall be assessed a fine
of $1,000 per day for each day the minimum number of signs
are not posted as required in this subsection.
(c) Mandatory training.--The board's Office of Compulsive and
Problem Gambling shall develop mandatory training for employees
and management of a licensed establishment who oversee the video
gaming terminal to identify and address compulsory gambling
behaviors and provide assistance to problem gamblers. The board
shall establish a fee to cover the cost of the training.
§ 11A19. Provisional licenses.
(a) General rule.--The General Assembly has determined that
prompt and expedited implementation of video gaming in this
Commonwealth is desirable, to the extent that such expedited
implementation can be accomplished without compromising the
integrity of gaming. The provisional licensing provisions of
this section are found to strike the correct balance between
assuring that licensees meet the licensing criteria without
causing an undue delay in implementation of this chapter.
(b) Provisional licensing of licensed liquor
establishments.--
(1) Within 60 days after the effective date of this
section, the board shall make applications for a video gaming
license as a licensed liquor establishment available to
applicants.
(2) The board shall issue a provisional license to an
applicant for a video gaming license as a licensed liquor
establishment if the applicant satisfies, as determined by
the board, all of the following criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
application for licensure as a licensed establishment,
which may be submitted concurrently with the applicant's
request for a provisional license.
(iv) The applicant held a valid liquor license under
Article IV of the act of April 12, 1951 (P.L.90, No.21),
known as the Liquor Code , on the date of application and
has never had the liquor license revoked.
(v) The applicant has never been convicted of any
gambling law violation in any jurisdiction.
(3) The board shall issue a provisional license to an
applicant for a video gaming license as a licensed liquor
establishment, within 60 days after the application has been
received by the board, provided that the board determines
that the criteria contained in paragraph (2) has been
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satisfied. If the board has determined that the criteria
contained in paragraph (2) has not been satisfied, the board
shall give a written explanation to the applicant as to why
it has determined the criteria has not been satisfied.
(4) A provisional license shall be valid until:
(i) the board either approves or denies the
applicant's application for licensure;
(ii) the provisional license is terminated for a
violation of this chapter; or
(iii) one calendar year has passed since the
provisional license was issued.
If the board fails to act upon the application for a video
gaming license as a licensed liquor establishment, within 60
days after the expiration of a provisional license, the
applicant may apply for a renewal of the provisional license.
(5) Each applicant shall attest by way of affidavit
under penalty of perjury that the applicant is not otherwise
prohibited from licensure according to the requirements of
this section or any other provision of this chapter.
(6) All requests for provisional licensure under this
subsection shall include payment of a $100 fee, which is in
addition to the applicable fee required for an application
for licensure as a licensed establishment.
(7) If the board fails to act upon a request for
provisional licensure within 60 days after receipt of the
request, the request shall be deemed approved and the board
shall issue the applicant a provisional video gaming license
as a licensed liquor establishment.
(b) Provisional licensing of terminal operators.--
(1) Within 60 days after the effective date of this
section, the board shall make applications for licensure as
terminal operator available to applicants.
(2) The board shall accept applications for licensure as
a terminal operator beginning 14 days after applications
become available.
(3) The board shall issue a provisional license to an
applicant for licensure as a terminal operator if the
applicant satisfies, as determined by the board, all of the
following criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
application for licensure as a licensed terminal
operator, which may be submitted concurrently with the
applicant's request for a provisional license.
(iv) The applicant has never had its terminal
operator license or similar gaming license revoked in
another jurisdiction.
(v) The applicant has never been convicted of any
gambling law violation in any jurisdiction.
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(4) The board shall issue a provisional license to an
applicant for licensure as a licensed terminal operator,
within 60 days after such application has been received by
the board, provided that the board determines that the
criteria contained in paragraph (3) has been satisfied. If
the board has determined that the criteria contained in
paragraph (3) has not been satisfied, the board shall give a
written explanation to the applicant as to why it has
determined the criteria has not been satisfied.
(5) A provisional license shall be valid until:
(i) the board either approves or denies the
applicant's application for licensure;
(ii) the provisional license is terminated for a
violation of this chapter; or
(iii) one calendar year has passed since the
provisional license was issued.
If the board fails to act upon the application for licensure
as a terminal operator, within 60 days after the expiration
of a provisional license, the applicant may apply for a
renewal of the provisional license.
(6) Each applicant shall attest by way of affidavit
under penalty of perjury that the applicant is not otherwise
prohibited from licensure according to the requirements of
this subsection or any other provision of this chapter.
(7) All requests for provisional licensure under this
subsection shall include payment of a $5,000 fee, which is in
addition to the applicable fee required for an application
for licensure as a terminal operator.
(8) The board shall initially issue no fewer than 10
provisional licenses to terminal operator applicants, unless
the board receives less than 10 applications for provisional
licenses.
(9) If the board fails to act upon a request for
provisional licensure within 60 days after receipt of the
request, the request shall be deemed approved and the board
shall issue the applicant a provisional license as a licensed
terminal operator.
(c) Provisional licensing of service technicians.--
(1) Within 60 days after the effective date of this
section, the board shall make applications for licensure as a
service technician available to applicants.
(2) The board shall issue a provisional license to an
applicant for licensure as a service technician if the
applicant satisfies, as determined by the board, all of the
following criteria:
(i) The applicant has never been convicted of a
felony.
(ii) The applicant is current on all State taxes.
(iii) The applicant has submitted a completed
application for licensure as a service technician, which
may be submitted concurrently with the applicant's
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