CSSB 170(L&C): "An Act relating to gaming; relating to bingo; relating to pull-tabs and electronic pull-tab systems; and providing for an effective date."
00 CS FOR SENATE BILL NO. 170(L&C) 01 "An Act relating to gaming; relating to bingo; relating to pull-tabs and electronic pull- 02 tab systems; and providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 05.15.030(a) is amended to read: 05 (a) [AT THE TIME OF FILING AN APPLICATION FOR A PERMIT OR 06 LICENSE UNDER THIS CHAPTER, THE APPLICANT SHALL NOTIFY THE 07 CITY OR BOROUGH NEAREST TO THE LOCATION OF THE PROPOSED 08 ACTIVITY OF THE APPLICATION.] A local government unit may protest the 09 conduct of the activity in its jurisdiction by resolution stating the reasons for the 10 protest filed with the department; protests are limited to the lack of qualifications 11 prescribed by this chapter. This resolution is only a recommendation by the local 12 government that may be considered by the department in determining whether to issue 13 or refuse to issue a permit or license. 14 * Sec. 2. AS 05.15.030(c) is amended to read:
01 (c) If a permittee or licensee changes the location of an activity in the 02 jurisdiction for which a permit has been issued, the permittee shall notify the 03 department [AND THE LOCAL GOVERNMENT] within 10 days after moving to the 04 new location. 05 * Sec. 3. AS 05.15.070 is amended to read: 06 Sec. 05.15.070. Investigations; examination [EXAMINATION] of books 07 and records. The department may investigate licensed and unlicensed gaming 08 operations and administer civil penalties for violations of this chapter. The 09 department may examine or have examined the books and records of a permittee, an 10 operator, a registered vendor, or a person licensed to manufacture or to distribute pull- 11 tab games or electronic pull-tab systems in the state. The department may issue 12 subpoenas for the attendance of witnesses and the production of books, records, and 13 other documents. 14 * Sec. 4. AS 05.15.080(b) is amended to read: 15 (b) A municipality or a qualified organization issued a permit under this 16 chapter shall file an annual report with the department by March 15 of the year 17 following the year in which activities were conducted, accompanied by the payment of 18 the additional fee, as may be required under AS 05.15.020(b). The report must list the 19 types of activities conducted, and, for each activity, the total amount of gross receipts, 20 the total amount of authorized expenses, the total value of prizes awarded, and the 21 total amount of net proceeds. The report must also list the source and monetary 22 value of marketing or promotional material received from a distributor. 23 * Sec. 5. AS 05.15.083 is amended to read: 24 Sec. 05.15.083. Reports to department by operators. (a) An operator shall 25 file a report with the department by the last business day of the month following each 26 calendar quarter in which an activity was conducted. The report must include, for each 27 authorizing permittee on whose behalf an activity was conducted during the quarter, 28 [THE DATE AND LOCATION OF EACH ACTIVITY,] the type of activity 29 conducted, the amount of gross receipts, [THE AMOUNT OF AUTHORIZED 30 EXPENSES,] the value of prizes [AWARDED], the amount of net proceeds paid, and 31 other information the department may require [; A COMPLETED INTERNAL
01 REVENUE SERVICE FORM 941; AND A COPY OF THE OPERATOR'S 02 EMPLOYER CONTRIBUTIONS AND WAGE REPORTS SUBMITTED TO THE 03 DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT FOR THE 04 QUARTER]. However, if the only activity conducted by an operator during the 05 calendar quarter is a raffle or lottery, then the operator is not required to file a report 06 under this subsection until the raffle or lottery is completed. 07 (b) An operator shall file an annual report with the department not [NO] later 08 than February 28 of the year following the year in which activities were conducted. 09 The report must include, for each authorizing permittee on whose behalf an activity 10 was conducted, the types of activities conducted, the total amount of gross receipts, 11 [THE TOTAL AMOUNT OF AUTHORIZED EXPENSES,] the total value of prizes 12 [AWARDED], and the total amount of net proceeds paid to each authorizing 13 permittee. [THE ANNUAL REPORT MUST ALSO INCLUDE A COMPLETED 14 INTERNAL REVENUE SERVICE FORM W-2 FOR EACH PERSON EMPLOYED 15 BY THE OPERATOR DURING THE PRECEDING YEAR.] 16 * Sec. 6. AS 05.15.087(a) is amended to read: 17 (a) An operator shall file a monthly report with each authorizing permittee for 18 which the operator has conducted an activity during the preceding month. The report 19 must include a [DAILY] summary of activity conducted under the permit issued to the 20 authorizing permittee and an accounting of gross receipts, prize payouts 21 [EXPENSES], and net proceeds for the month. A check or electronic funds transfer 22 in the amount of the net proceeds due to the authorizing permittee for the month must 23 accompany the report. The operator shall file the report by the 15th day after the end 24 of the month covered by the report. 25 * Sec. 7. AS 05.15.105(b) is amended to read: 26 (b) The department shall adopt regulations that provide that a disqualification 27 of a person under (a) of this section based on [UPON] a conviction of that person or a 28 person described in (c) of this section for a violation 29 (1) of a law of this state that is, or a law or ordinance of another 30 jurisdiction that would be if it was committed in this state, a class B felony other than 31 extortion, a class C felony, or an unclassified felony described outside of AS 11, and
01 that is not a crime of dishonesty or theft or a violation of gambling laws, terminates 10 02 years after the person's conviction; 03 (2) of a law or ordinance of this state or another jurisdiction that is a 04 crime involving theft or dishonesty or a violation of gambling laws, and that is not, or 05 would not be if it was committed in this state, an unclassified felony described in 06 AS 11, a class A felony, or extortion, terminates 10 years after the person's conviction, 07 if the department determines that the 08 (A) person is of good character, honesty, and integrity; and 09 (B) person's involvement in charitable gaming is not against the 10 public interest. 11 * Sec. 8. AS 05.15.105 is amended by adding a new subsection to read: 12 (c) The department may not issue a license to a manufacturer or distributor if a 13 parent company, sister company, or subsidiary of the manufacturer or distributor has 14 been convicted of a violation of a law that would disqualify the parent company, sister 15 company, or subsidiary under (a) of this section. 16 * Sec. 9. AS 05.15.115(b) is amended to read: 17 (b) The contract between an authorizing permittee and an operator must 18 include the amount and form of compensation to be paid to the operator, the term of 19 the contract, the activities to be conducted by the operator on behalf of the permittee, 20 the location where the activities are to be conducted, the name and address of the 21 member in charge, and other provisions the department may require. A contract 22 between an authorizing permittee and an operator may allow the operator to 23 pool together permittees and divide the gaming income and payouts among 24 permittees on a percentage basis to be determined at the end of each month. 25 * Sec. 10. AS 05.15.115(d) is amended to read: 26 (d) An operator [A PERMITTEE] shall electronically submit [BY 27 CERTIFIED MAIL] to the department for approval a copy of each contract with a 28 permittee [AN OPERATOR] with whom the operator [PERMITTEE] contracts to 29 conduct activities subject to this chapter. The contract must meet the requirements of 30 this section. The department shall approve or disapprove the contract. If the contract is 31 disapproved, reasons for the disapproval shall be provided in writing to the operator
01 [PERMITTEE]. Activities may not be conducted under the contract before the 02 contract is approved. Subsequent amendments to an approved contract do not take 03 effect until the amendments are approved by the department. 04 * Sec. 11. AS 05.15.122 is amended by adding new subsections to read: 05 (e) An operator licensed under this section may conduct electronic pull-tab 06 activities on behalf of a municipality or a qualified organization only if the department 07 has issued a separate electronic pull-tab endorsement to the operator's license for 08 electronic pull-tab systems. The department may issue an electronic pull-tab 09 endorsement if 10 (1) the operator has filed all reports required under AS 05.15.087; 11 (2) the operator's license has not been revoked by the department in the 12 immediately preceding five years; and 13 (3) the operator has conducted pull-tab games for at least the preceding 14 three years. 15 (f) If an operator that is a natural person dies, the estate of the operator may 16 designate a temporary responsible party to conduct activities authorized by the 17 operator's license for 120 days after the death of the operator. 18 * Sec. 12. AS 05.15.122(e), enacted by sec. 11 of this Act, is amended to read: 19 (e) An operator licensed under this section may conduct electronic pull-tab 20 activities on behalf of a municipality or a qualified organization only if the department 21 has issued a separate electronic pull-tab endorsement to the operator's license for 22 electronic pull-tab systems. The department may issue an electronic pull-tab 23 endorsement if 24 (1) the operator has filed all reports required under AS 05.15.087; and 25 (2) the operator's license has not been revoked by the department in the 26 immediately preceding five years [; AND 27 (3) THE OPERATOR HAS CONDUCTED PULL-TAB GAMES 28 FOR AT LEAST THE PRECEDING THREE YEARS]. 29 * Sec. 13. AS 05.15.128(a) is amended to read: 30 (a) The department shall revoke 31 (1) the license of an operator who does not [(1) REPORT AN
01 ADJUSTED GROSS INCOME OF AT LEAST 15 PERCENT OF GROSS INCOME 02 ANNUALLY BASED ON THE TOTAL OPERATION OF THE OPERATOR; OR 03 (2)] pay to each authorizing permittee annually at least 30 percent of the adjusted 04 gross income [, AS DETERMINED UNDER (1) OF THIS SUBSECTION,] from a 05 pull-tab activity or at least 10 percent of the adjusted gross income [, AS 06 DETERMINED UNDER (1) OF THIS SUBSECTION,] from a gaming activity other 07 than pull-tabs [,] received from activities conducted on behalf of the authorizing 08 permittee; 09 (2) a multiple-beneficiary permit if payments under the multiple- 10 beneficiary permit to the holders of the multiple-beneficiary permit do not 11 annually total at least 30 percent of the adjusted gross income from a pull-tab 12 activity or at least 10 percent of the adjusted gross income from a gaming activity 13 other than pull-tabs received from activities conducted on behalf of the 14 authorizing multiple-beneficiary permit. 15 * Sec. 14. AS 05.15.165(a) is amended to read: 16 (a) An operator shall pay net proceeds to the authorizing permittee by check 17 or electronic funds transfer. 18 * Sec. 15. AS 05.15.165(c) is amended to read: 19 (c) The operator shall post in a public place on the premises where the 20 activities are conducted the operator's license and a copy of the permit of each 21 authorizing permittee with whom the operator has a contract to conduct activities at 22 the location. A sign posted on the premises that directs individuals to an 23 operator's Internet website or landing page satisfies the requirements of this 24 subsection if the posted sign states that the information required by this 25 subsection is contained on the Internet website or landing page and the Internet 26 website or landing page contains the required information. 27 * Sec. 16. AS 05.15.170(a) is amended to read: 28 (a) The department may suspend, for a period of up to one year, or revoke a 29 permit, license, or vendor registration, after giving notice to and an opportunity to be 30 heard by the permittee or licensee, if the permittee, licensee, or vendor 31 (1) violates or fails to comply with a requirement of this chapter or of a
01 regulation adopted under this chapter; 02 (2) breaches a contractual agreement with a permittee, licensee, or 03 registered vendor; 04 (3) becomes disqualified to participate in charitable gaming as 05 provided in AS 05.15.105; for the purposes of this paragraph, a permittee, licensee, or 06 vendor that is not a natural person is considered convicted if an owner or manager of 07 the permittee or an owner or manager of a parent company, sister company, or 08 subsidiary of the [,] licensee [,] or vendor is convicted; 09 (4) knowingly submits false information to the department or, in the 10 case of a registered vendor, to a permittee when the vendor knows that the false 11 information will be submitted to the department as part of an application for 12 registration; or 13 (5) gives or acts on [UPON] any inside information on the status of the 14 prizes awarded or to be awarded in a pull-tab game. 15 * Sec. 17. AS 05.15.170 is amended by adding new subsections to read: 16 (c) When a permit, license, or vendor registration is suspended or revoked, the 17 department shall notify an operator that conducts an activity on behalf of or a 18 distributor that supplies the permittee, vendor, or licensee that the permit has been 19 suspended or revoked. The notification must be in the form of electronic mail and a 20 message transmitted through a website created for the purpose of allowing citizens to 21 interact with multiple state services through a single username and password. 22 (d) When a license of a distributor is suspended or revoked, the department 23 shall notify a manufacturer that supplies the distributor that the distributor has had the 24 license suspended or revoked. The notification must be in the form of electronic mail 25 and a message transmitted through an Internet website created for the purpose of 26 allowing citizens to interact with multiple state services through a single username and 27 password. 28 * Sec. 18. AS 05.15.180(b) is amended to read: 29 (b) With the exception of raffles, lotteries, bingo games, pull-tab games, 30 electronic pull-tabs, freeze-up classics, race classics, rain classics, goose classics, 31 mercury classics, deep freeze classics, dog mushers' contests, snow classics, snow
01 machine classics, canned salmon classics, salmon classics, animal classics, crane 02 classics, cabbage classics, Calcutta pools, big bull moose derbies, and king salmon 03 classics, a permit may not be issued for an activity under this chapter unless it existed 04 in the state in substantially the same form and was conducted in substantially the same 05 manner before January 1, 1959. A permit may not be issued for a snow machine 06 classic under this chapter unless it has been in existence for at least five years before 07 the permit is issued. A permit may not be issued for an animal classic under this 08 chapter unless it was in existence before November 1, 2002. 09 * Sec. 19. AS 05.15.180(d) is amended to read: 10 (d) The total value of door prizes offered or awarded under authority of a 11 permit issued to a municipality or qualified organization under this chapter or under 12 authority of a multiple-beneficiary permit may not exceed $40,000 [$20,000] a month 13 or $480,000 [$240,000] a year. 14 * Sec. 20. AS 05.15.180(e) is amended to read: 15 (e) The department shall adopt regulations that set prize amounts for 16 bingo games. The regulations must allow an operator of a bingo game to award 17 prizes of not more than $10,000 in one bingo session and award a top prize of not 18 more than $2,500 in a bingo game. The total value of all door prizes offered or 19 awarded at a single facility or bingo hall or parlor by an operator on behalf of 20 authorizing permittees may not exceed $40,000 [$20,000] a month or $480,000 21 [$240,000] a year. An operator of a bingo game may offer progressive bingo. A 22 progressive bingo game does not count toward the prize limitations in this 23 subsection. In a progressive bingo game, 24 (1) a portion of the gross receipts must be carried over to another 25 game if no player declares a valid bingo for a progressive prize or prizes based on 26 a predetermined and posted win determination; 27 (2) the portion of the prize that is not carried over must be 28 awarded to the first player or players who declare a valid bingo as additional 29 numbers are called; and 30 (3) the entire prize pool for that game must be awarded to the 31 winner or winners if a valid bingo is declared.
01 * Sec. 21. AS 05.15.180(f) is amended to read: 02 (f) A person under the age of 18 [19] years may not play a bingo game. 03 * Sec. 22. AS 05.15.180(g) is amended to read: 04 (g) A municipality or a qualified organization may award a maximum of 05 $2,000,000 in prizes each year in activities authorized under this chapter [; 06 HOWEVER, IF A MUNICIPALITY OR A QUALIFIED ORGANIZATION 07 CONTRACTS WITH AN OPERATOR TO CONDUCT ON ITS BEHALF 08 ACTIVITIES AUTHORIZED UNDER THIS CHAPTER, THE MUNICIPALITY OR 09 QUALIFIED ORGANIZATION MAY AWARD A MAXIMUM OF $500,000 IN 10 PRIZES EACH YEAR]. A municipality or a qualified organization that conducts a 11 contest of skill and awards more than $1,000,000 in prizes to the participants in that 12 contest of skill may exclude $1,000,000 in prizes awarded to those participants from 13 the $2,000,000 maximum allowed in this subsection. The holders of a multiple- 14 beneficiary permit under AS 05.15.100(d) may award a maximum in prizes each year 15 of $2,000,000 times the number of holders of the permit for activities authorized under 16 this chapter. In this subsection, "activities authorized under this chapter" means all 17 activities subject to this chapter other than bingo and electronic pull-tabs. 18 * Sec. 23. AS 05.15.180 is amended by adding new subsections to read: 19 (i) A municipality or a qualified organization may award a maximum of 20 $4,000,000 in prizes for electronic pull-tab games each year. The holders of a 21 multiple-beneficiary permit issued under AS 05.15.100(d) may award a maximum in 22 prizes each year of $4,000,000 times the number of holders of the permit for activities 23 authorized under this chapter for electronic pull-tab games. 24 (j) Beginning in 2030, the department may by regulation increase the 25 monetary amounts in (g) and (i) of this section by up to 10 percent, rounded up to the 26 nearest $10,000, once every five years. 27 * Sec. 24. AS 05.15.181(d) is amended to read: 28 (d) A pull-tab manufacturer may distribute pull-tabs only to a licensed pull-tab 29 distributor [UNLESS THE PULL-TAB MANUFACTURER IS ALSO A LICENSED 30 PULL-TAB DISTRIBUTOR]. 31 * Sec. 25. AS 05.15.181 is amended by adding new subsections to read:
01 (f) A pull-tab manufacturer may not modify or pay another person to modify a 02 building to accommodate the installation of a gaming system, perform or pay another 03 person to perform electrical work necessary to install a gaming system, or provide a 04 utility connection for a gaming system. 05 (g) A pull-tab manufacturer, an owner or employee of a manufacturer, an 06 immediate family member of an owner or employee of a manufacturer, or a parent 07 company, sister company, or subsidiary of a manufacturer may not 08 (1) provide gifts, gratuities, premiums, or other things of value to a 09 vendor, operator, permittee, or qualified organization; 10 (2) accept gifts, gratuities, premiums, or other things of value from a 11 vendor, operator, permittee, or qualified organization or an owner, employee, or 12 immediate family member of an owner or employee of a vendor, operator, permittee, 13 or qualified organization. 14 (h) A pull-tab manufacturer may distribute to a distributor in this state an 15 electronic pull-tab system for use in the state only if the department has issued a 16 separate electronic pull-tab endorsement to the manufacturer's license. A pull-tab 17 manufacturer licensed in the state who manufactures electronic pull-tab systems for 18 use in the state shall submit, at the manufacturer's expense, the electronic pull-tab 19 system to an independent gaming testing laboratory approved by the department for 20 testing and certification before distribution. In this subsection, "manufacture" includes 21 the development, creation, and programming of any electronic device, hardware, 22 software, or computer systems used in the operation of a pull-tab or electronic pull-tab 23 system; "manufacture" does not include the development, creation, and programming 24 of standard hardware or software components. 25 (i) A pull-tab manufacturer may not distribute electronic pull-tabs to a 26 distributor if one of the following persons holds an ownership interest in the 27 distributor: 28 (1) the manufacturer; 29 (2) an owner or employee of the manufacturer; 30 (3) a family member related within two degrees of consanguinity to an 31 owner or employee of the manufacturer;
01 (4) a parent company, sister company, or subsidiary of the 02 manufacturer. 03 (j) A pull-tab manufacturer may refuse to sell gaming equipment or paper 04 pull-tabs to a licensed distributor that has been licensed and had gross annual sales in 05 the state exceeding $500,000 for at least three years only if 06 (1) the distributor seeks to buy a specific paper pull-tab game being 07 sold exclusively to one distributor during the first five years of production as permitted 08 under (m) of this section; 09 (2) the manufacturer does not sell gaming equipment to any 10 distributors in the state; 11 (3) sale of the gaming equipment or paper pull-tabs is prohibited by 12 law or regulation; 13 (4) the distributor is delinquent on a payment owed to the 14 manufacturer or has a history of delinquent payments; or 15 (5) the distributor is owned, in whole or in part, by 16 (A) a manufacturer; 17 (B) the parent company, sister company, subsidiary, or 18 shareholder of a manufacturer; 19 (C) a parent, child, or sibling of an officer or manager of a 20 competing manufacturer. 21 (k) Subsection (j) does not apply to application software and computer 22 programs and equipment used by a licensed pull-tab manufacturer in the production, 23 playing, and reporting of approved electronic pull-tab games. 24 (l) A pull-tab manufacturer shall provide the same price points and quantity 25 requirements for paper pull-tabs to each distributor. 26 (m) A pull-tab manufacturer may make available a paper pull-tab game 27 exclusively to one distributor during the first five years of production of the game. 28 After five years of production, the manufacturer shall make the game available to all 29 distributors. However, the manufacturer may continue to make a paper pull-tab game 30 exclusively available to one distributor after five years of production if the distributor 31 sells the game only to a single licensee. A paper pull-tab game is exclusive to one
01 distributor only if the game contains significantly unique graphics. Minor changes 02 made to an existing pull-tab game do not create an exclusive game. 03 (n) A pull-tab manufacturer shall submit to the department a copy of each 04 contract with a distributor within seven days after signing. 05 (o) A pull-tab manufacturer may not obtain, use, share, or sell point-of-sale 06 data from paper tickets or bingo. 07 (p) The department may not issue a pull-tab manufacturer's license to a person 08 who is otherwise prohibited from involvement under AS 05.15.105. 09 (q) A pull-tab manufacturer may not connect the price or availability of a 10 paper pull-tab game to an electronic pull-tab or the price or availability of an 11 electronic pull-tab to a paper pull-tab game. 12 * Sec. 26. AS 05.15.183(a) is amended to read: 13 (a) A person may not distribute pull-tab games or electronic pull-tab systems 14 unless the person has received a pull-tab distributor's license issued by the department. 15 The department may not issue a pull-tab distributor's license to a person licensed 16 as an operator or who otherwise participates in the conduct of an activity 17 authorized under this chapter on behalf of a municipality or qualified 18 organization. The department may not issue an electronic pull-tab endorsement 19 to a distributor's license to a manufacturer, or parent company, sister company, 20 or subsidiary of a manufacturer. 21 * Sec. 27. AS 05.15.183(c) is amended to read: 22 (c) Pull-tabs or electronic pull-tab systems may be distributed only from a 23 location in the state. A person may not distribute pull-tabs or electronic pull-tab 24 systems directly to another person in the state from a location outside of this state. 25 * Sec. 28. AS 05.15.183(e) is amended to read: 26 (e) A distributor may deliver an electronic pull-tab series to a computer 27 server at a vendor's location on behalf of a permittee authorized to conduct pull- 28 tab sales at the vendor's location. A distributor may not 29 (1) take an order for the purchase of a pull-tab series from a vendor; 30 (2) sell a pull-tab series to a vendor; or 31 (3) deliver a pull-tab series to a vendor, except an electronic pull-tab
01 series as expressly authorized in this subsection. 02 * Sec. 29. AS 05.15.183 is amended by adding new subsections to read: 03 (f) A licensed distributor may distribute an electronic pull-tab system in the 04 state only if the department has issued a separate electronic pull-tab endorsement to 05 the distributor's license. 06 (g) The department may not issue a pull-tab distributor's license to a person 07 who is otherwise prohibited from involvement under AS 05.15.105. 08 (h) A distributor may not 09 (1) provide to a municipality or qualified organization, or an employee 10 or agent of a municipality or qualified organization, compensation, a gift, gratuity, 11 premium, or other thing of value in an amount greater than $25 annually for each 12 organization; 13 (2) modify or pay another person to modify a building to accommodate 14 the installation of a gaming system, perform or pay another person to perform 15 electrical work necessary to install a gaming system, or provide a utility connection 16 for a gaming system; 17 (3) provide to an owner or lessor of a gaming premises compensation, 18 a gift, gratuity, premium, or other thing of value; 19 (4) participate in a gaming activity at a gaming premises that uses 20 gaming equipment purchased or leased from that distributor; 21 (5) alter or modify any gaming equipment, except to add a sticker 22 indicating the last ticket sold for a pull-tab game; 23 (6) obtain or use point-of-sale information for a paper pull-tab game or 24 bingo; 25 (7) connect the price or availability of a paper pull-tab game to an 26 electronic pull-tab or the price or availability of an electronic pull-tab to a paper pull- 27 tab game; 28 (8) be an owner or shareholder of a manufacturer, or a corporation that 29 owns a manufacturer, licensed under AS 05.15.181; 30 (9) distribute electronic pull-tabs from a manufacturer if a person 31 described in AS 05.15.181(i) holds an ownership interest in the distributor;
01 (10) distribute a pull-tab game to a permittee or licensee that is owned 02 or managed by a person that is related within two degrees of consanguinity to an 03 individual that owns or is employed by the distributor. 04 (i) A distributor may only distribute electronic pull-tabs that meet the 05 requirements of AS 05.15.186. 06 (j) A distributor may provide marketing, promotional, or point-of-sale items or 07 materials for the promotion of lawful gaming to a municipality or qualified 08 organization, operator, or multiple-beneficiary permittee for use at a premises where 09 gaming is conducted by holders of a license or permit under this chapter. The total 10 value of marketing, promotional, or point-of-sale items or materials that a distributor 11 provides to a municipality or qualified organization, operator, or multiple-beneficiary 12 permittee may not exceed $250 a year. A distributor shall file an annual report with 13 the department by a date determined by the department that lists the value of items or 14 materials provided under this subsection in the past year. The report must identify the 15 physical locations where the items or materials will be used or displayed. 16 (k) A distributor shall submit to the department a copy of each contract with a 17 permittee, multiple-beneficiary permittee, vendor, or operator within seven days after 18 signing the contract. 19 (l) The department shall provide a serialized stamp to a distributor. The 20 distributor shall register all gaming tablets with the department and shall affix the 21 serialized stamp to the tablet. 22 (m) A contract between a distributor and a permittee 23 (1) must allow either party to terminate the contract without penalty 24 with 30 days' notice; 25 (2) may not include an incentive or signing bonus; 26 (3) may not penalize a party based on the length of the term of the 27 contract. 28 * Sec. 30. AS 05.15.185 is amended to read: 29 Sec. 05.15.185. Distribution of pull-tab games. Each series of pull-tabs 30 distributed in the state must have a serial number and be sealed or encrypted in a 31 manner [AND HAVE A SERIAL NUMBER LABEL ISSUED BY THE
01 NATIONAL ASSOCIATION OF FUNDRAISING TICKET MANUFACTURERS 02 OR OTHER SERIAL NUMBER LABEL] approved by the department and may be 03 distributed only to 04 (1) a municipality or a qualified organization that has obtained a 05 permit issued under this chapter; 06 (2) an operator; [ON BEHALF OF AN AUTHORIZING 07 PERMITTEE; OR] 08 (3) a distributor licensed under this chapter; or 09 (4) a vendor by a distributor as authorized under AS 05.15.183(e). 10 * Sec. 31. AS 05.15.185 is amended by adding new subsections to read: 11 (b) An electronic pull-tab series distributed in the state must 12 (1) have a predetermined and finite number of winning and 13 nonwinning tickets; 14 (2) have a predetermined prize amount and structure; 15 (3) have a unique serial number that is not regenerated. 16 (c) An electronic pull-tab series distributed in the state may not 17 (1) exceed 15,000 tickets; 18 (2) require additional consideration for an extended play feature 19 included in the game. 20 (d) An invoice for a paper pull-tab game distributed in the state must specify 21 the cost for each ticket for the pull-tab game. 22 * Sec. 32. AS 05.15 is amended by adding a new section to read: 23 Sec. 05.15.186. Electronic pull-tabs. (a) An electronic pull-tab system used to 24 sell an electronic pull-tab series in the state 25 (1) may accept United States currency in paper form; 26 (2) may accept a debit card transaction; 27 (3) may not accept credit card transactions or be part of a system that 28 accepts credit card transactions; 29 (4) must clearly display the result and any prize awarded following the 30 play of an electronic pull-tab game on the electronic pull-tab device and reveal the 31 numbers or series of the pull-tab on the device;
01 (5) may use an autoclose system to close a game when all winning 02 tickets over a predetermined value are gone from the game; an autoclose feature must 03 be disclosed on the electronic game flare card with a statement identifying when the 04 game will be closed; and 05 (6) must be a tablet device with a screen not larger than 13 inches in 06 width or height; the tablet may not be connected to an external monitor or input 07 device. 08 (b) An electronic pull-tab system used to sell an electronic pull-tab series in 09 the state may not 10 (1) display on the device spinning reels that mimic a slot machine; or 11 (2) dispense anything of value. 12 (c) A device used to play electronic pull-tabs must be incorporated into an 13 electronic pull-tab system and may not be used for personal communication. 14 Connections between all components and access points of the electronic pull-tab 15 system must use secure communication protocols designed to prevent unauthorized 16 access or tampering, employing advanced encryption standard specifications adopted 17 by the National Institute of Standards and Technology, or in accordance with IEEE 18 802.11 standards contained in the Wi-Fi Protected Access II authentication protocols 19 or other nationally recognized security protocols as prescribed by the department. 20 (d) A pull-tab manufacturer shall maintain and keep current operating system 21 software agreements. An operating system agreement must be made available to the 22 department. 23 (e) The ideal payout for electronic pull-tabs may not exceed 90 percent. 24 (f) The total price, including fees, a distributor charges a permittee or licensee 25 for an electronic pull-tab system may not exceed 35 percent of the gross receipts less 26 the prize payouts of the electronic pull-tab system. 27 (g) A distributor may not connect the price or availability of a paper pull-tab 28 game to an electronic pull-tab. 29 * Sec. 33. AS 05.15.187(d) is amended to read: 30 (d) A paper pull-tab series may not be withdrawn from sale until all pull-tabs 31 in the series are sold, except that a pull-tab series may be withdrawn from sale if a
01 manufacturing defect exists in the series and the department is notified of the defect 02 and of the withdrawal from sale within a period established by regulation by the 03 department. 04 * Sec. 34. AS 05.15.187(e) is amended to read: 05 (e) Pull-tabs may not be sold to or accessed by a person under the age of 18 06 [21] years. A person under the age of 18 [21] years may not purchase or redeem a 07 pull-tab. 08 * Sec. 35. AS 05.15.187(f) is amended to read: 09 (f) Each permittee that had gross receipts exceeding $100,000 during the 10 preceding year from activities conducted under this chapter or that is required to report 11 under AS 05.15.080(a) shall maintain records as required by this subsection. A 12 permittee [,] that conducts a paper pull-tab game shall maintain records for two years 13 of each prize of $100 [$50] or more, the first day and last day that each series was 14 distributed, the serial number of each series, and the distributor from whom each series 15 was purchased. A permittee that conducts an electronic pull-tab game shall 16 maintain records for two years of each prize that is more than $500 and greater 17 than 500 times the ticket price [IN THIS SECTION "PERMITTEE" INCLUDES 18 MUNICIPALITIES AND QUALIFIED ORGANIZATIONS THAT JOINTLY HOLD 19 A MULTIPLE-BENEFICIARY PERMIT]. 20 * Sec. 36. AS 05.15.187(i) is amended to read: 21 (i) A permittee, operator, or registered vendor may not turn over a prize of 22 $100 [$50] or more to a person with a paper pull-tab card entitling the person to that 23 prize unless the person signs a receipt for the prize and returns the receipt to the 24 permittee, operator, or vendor. The receipt must be in a form approved by the 25 department. 26 * Sec. 37. AS 05.15.187 is amended by adding new subsections to read: 27 (j) An operator or permittee shall designate a person who is responsible for 28 overseeing pull-tabs or an electronic pull-tab system. A designated person must be on 29 site and provide direct oversight of the pull-tab or electronic pull-tab system. 30 (k) The department shall limit the number of tablets a permittee, licensee, or 31 vendor has in play at a location to one tablet for every six persons permitted to occupy
01 the premises or 10 tablets total, whichever is greater. 02 (l) An owner or employee of an establishment that sells paper pull-tabs may 03 not play paper pull-tabs at the establishment. 04 (m) A person who has access to an electronic pull-tab deck status report at a 05 location may not play electronic pull-tabs at that location. 06 (n) An operator, permittee, or qualified organization may not accept gifts from 07 a pull-tab manufacturer, an owner or employee of a manufacturer, an immediate 08 family member of an owner or employee of a manufacturer, or a parent company, 09 sister company, or subsidiary of a manufacturer. 10 * Sec. 38. AS 05.15.188(g) is amended to read: 11 (g) A person, other than a permittee's member in charge or alternate 12 member in charge [MEMBER-IN-CHARGE], may not directly supply a paper pull- 13 tab series to a registered vendor for sale by that vendor on behalf of the permittee. 14 * Sec. 39. AS 05.15.188(h) is amended to read: 15 (h) If a permittee contracts with a vendor under (a) of this section for paper 16 pull-tabs, the contract must provide that the permittee shall receive not [NO] less than 17 70 percent of the ideal net. 18 * Sec. 40. AS 05.15.188(i) is amended to read: 19 (i) An amount equal to the ideal net less the compensation owed to the vendor 20 shall be paid by the vendor to the member in charge or alternate member in charge 21 [MEMBER-IN-CHARGE] upon delivery of a paper pull-tab series to the vendor for 22 sale. The amount required to be paid by the vendor shall be paid by check or 23 electronic funds transfer and [THE CHECK MAY NOT BE DRAWN IN A 24 MANNER THAT] the payee must be [IS NOT] identified. 25 * Sec. 41. AS 05.15.188 is amended by adding new subsections to read: 26 (l) If a permittee contracts with a vendor under (a) of this section for electronic 27 pull-tabs, the contract must provide that the vendor will retain not more than 25 28 percent of the gross receipts less the prize payouts. 29 (m) A vendor location may sell only paper pull-tabs and electronic pull-tabs 30 accessed on a portable tablet device. 31 (n) A vendor shall report to the department the amount of adjusted gross
01 income disbursed to permittees each month. The vendor's portion may not be more 02 than 30 percent of the adjusted gross income for paper pull-tabs nor more than 25 03 percent for electronic pull-tabs. A distributor may submit the report to the department 04 for a vendor. 05 (o) Not later than the fifth day of each month, a distributor shall make 06 available a report detailing, for the previous month, the total income from electronic 07 pull-tabs, the prizes distributed, and a calculation of the adjusted gross income for 08 each vendor location. 09 (p) A cash shortage is the responsibility of the vendor and may not be 10 deducted from the adjusted gross income. 11 (q) A vendor shall pay the permittee, or shall pay the distributor on behalf of 12 the permittee, by check or electronic funds transfer and identify the payee not later 13 than the 15th day of each month for the previous month's sales. If a vendor fails to 14 make a payment on time, the distributor shall disable the vendor's electronic pull-tab 15 games until payment is made. If a vendor's payment is 60 or more days past due, the 16 Alcoholic Beverage Control Board may suspend the vendor's license or permit under 17 AS 04.11.370(c). A distributor may facilitate the timely transfer of a payment from a 18 vendor to a permittee or the distributor by using a third party approved by the 19 department. The department may adopt regulations to implement this subsection. 20 (r) A contract between an authorizing permittee and a vendor may allow the 21 vendor to pool together permittees and divide the gaming income and payouts among 22 permittees on a percentage basis. 23 (s) The department may not register as a vendor a person who is otherwise 24 prohibited from involvement under AS 05.15.105. 25 (t) A vendor may not accept gifts from a pull-tab manufacturer, an owner or 26 employee of a manufacturer, an immediate family member of an owner or employee 27 of a manufacturer, or a parent company, sister company, or subsidiary of a 28 manufacturer. 29 * Sec. 42. AS 05.15.640(a) is amended to read: 30 (a) A person may not use broadcasting to [PROMOTE OR] conduct a 31 charitable gaming activity under this chapter [EXCEPT THAT A PERSON MAY
01 USE 02 (1) BROADCASTING TO PROMOTE A FISH DERBY, A DOG 03 MUSHERS' CONTEST, A TYPE OF CLASSIC DEFINED IN AS 05.15.690, OR A 04 RAFFLE AND LOTTERY; OR 05 (2) THE INTERNET OR AN INTERNET COMMUNICATION TO 06 PROMOTE A CHARITABLE GAMING ACTIVITY UNDER THIS CHAPTER]. 07 * Sec. 43. AS 05.15.640(c) is amended to read: 08 (c) Notwithstanding (a) of this section, a permittee, an operator, or the holder 09 of a multiple-beneficiary permit may use the Internet or an Internet communication to 10 conduct a charitable gaming activity for a raffle or lottery, dog mushers' contest, 11 derby, or type of classic defined in AS 05.15.690. The permittee, an operator, or the 12 holder of a multiple-beneficiary permit may draw winning tickets online or by other 13 electronic or digital means. In this subsection, 14 (1) "Internet" means the combination of computer systems or 15 networks that make up the international network for interactive communications 16 services, including remote logins, file transfer, electronic mail, and newsgroups; 17 (2) "Internet communication" means an announcement or 18 advertisement disseminated through the Internet. 19 * Sec. 44. AS 05.15.690(1) is amended to read: 20 (1) "adjusted gross income" means gross income less prizes awarded, 21 tax collected under AS 05.15.184, and state, federal, and municipal taxes paid or 22 owed on the income; 23 * Sec. 45. AS 05.15.690(33) is amended to read: 24 (33) "net proceeds" means the gross receipts from an authorized 25 activity less the fee described in AS 05.15.020(b), [THE] expenses [AUTHORIZED 26 BY AS 05.15.160], and the prizes awarded at the activity; 27 * Sec. 46. AS 05.15.690(39) is amended to read: 28 (39) "pull-tab or pull-tab game" means a game of chance where a 29 card, or electronic representation of a card, the face of which is covered to conceal 30 a number, symbol, or set of symbols, is purchased by the participant and where a prize 31 is awarded for a card, or electronic representation of a card, containing certain
01 numbers or symbols designated in advance and at random; 02 * Sec. 47. AS 05.15.690(40) is amended to read: 03 (40) "qualified organization" means a bona fide civic or service 04 organization or a bona fide religious, charitable, fraternal, veterans, labor, political, or 05 educational organization, school-based extracurricular or co-curricular booster 06 club, police or fire department and company, dog mushers' association, outboard 07 motor association, or fishing derby or nonprofit trade association in the state, that 08 operates without profits to its members and that has been in existence continually for a 09 period of three years immediately before applying for the license or permit, or a 10 booster club that has been in existence continually for a period of less than three 11 years if the booster club's primary function is to support a school-based 12 extracurricular or cocurricular activity that has been in existence continually for 13 a period of three years immediately before the booster club applies for the license 14 or permit; the organization may be a firm, corporation, company, association, or 15 partnership; in this paragraph, "fishing derby association" means a civic, service, or 16 charitable organization in the state, not for pecuniary profit, whose primary purpose is 17 to promote interest in fishing for recreational purposes, but does not include an 18 organization formed or operated for gaming or gambling purposes; 19 * Sec. 48. AS 05.15.690(46) is amended to read: 20 (46) "series" means a unit of pull-tabs with the same serial number or 21 a unit of electronic pull-tabs that have a unique serial number; 22 * Sec. 49. AS 05.15.690 is amended by adding new paragraphs to read: 23 (51) "distributor" includes a distributor salesperson, or representative, 24 agent, affiliate, or other employee of a distributor; 25 (52) "electronic pull-tab system" means individual electronic pull-tabs, 26 portable tablet pull-tab devices, and related hardware and software used to play or 27 facilitate the play of an electronic pull-tab series; 28 (53) "immediate family member" has the meaning given in 29 AS 39.52.960; 30 (54) "manufacturer" includes a manufacturer salesperson or a 31 representative, agent, affiliate, or other employee of a manufacturer.
01 * Sec. 50. AS 05.15.060(b), 05.15.115(c), 05.15.150(b), 05.15.160, 05.15.165(b), 02 05.15.640(b), 05.15.640(g)(2), and 05.15.640(g)(3) are repealed. 03 * Sec. 51. The uncodified law of the State of Alaska is amended by adding a new section to 04 read: 05 APPLICABILITY. AS 05.15.183(m), enacted by sec. 29 of this Act, applies to a 06 contract entered into, renewed, or amended on or after the effective date of sec. 29 of this Act. 07 * Sec. 52. The uncodified law of the State of Alaska is amended by adding a new section to 08 read: 09 TRANSITION: REGULATIONS. The Department of Revenue may adopt regulations 10 necessary to implement the changes made by this Act. The regulations take effect under 11 AS 44.62 (Administrative Procedure Act), but not before the effective date of the law 12 implemented by the regulation. 13 * Sec. 53. Section 52 of this Act takes effect immediately under AS 01.10.070(c). 14 * Sec. 54. Section 12 of this Act takes effect January 1, 2031. 15 * Sec. 55. Except as provided in secs. 53 and 54 of this Act, this Act takes effect January 1, 16 2027.