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SB1765 - 572R - I Ver
REFERENCE TITLE:
event wagering; problem gambling fund
State of Arizona
Senate
Fifty-seventh Legislature
Second Regular Session
2026
SB 1765
Introduced by
Senator
Gonzales
AN
ACT
amending section 5-572, Arizona
Revised Statutes, as amended by laws 2024, chapter 210, section 2; amending
section 5-572, Arizona Revised Statutes, as amended by laws 2024, chapter
210, section 3; amending section 5-1305, Arizona Revised Statutes;
amending title 5, chapter 11, article 1, Arizona Revised Statutes, by adding
section 5-1318.01; relating to event wagering.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 5-572, Arizona Revised
Statutes, as amended by Laws 2024, chapter 210, section 2, is amended to read:
START_STATUTE
5-572.
Use of monies in state lottery fund; report
A. If there are any bonds or bond related
obligations payable from the state lottery revenue bond debt service fund, the
state lottery revenue bond debt service fund shall be secured by a first lien
on the monies in the state lottery fund after the payment of operating costs of
the lottery, as prescribed in section 5-555, subsection A, paragraph 1,
until the state lottery bond debt service fund contains sufficient monies to
meet all the requirements for the current period as required by the bond
documents. Debt service for revenue bonds issued pursuant to this
chapter shall be paid first from monies that would have otherwise been
deposited pursuant to this section in the state general fund. After
the requirements for the current period have been satisfied as required by the
bond documents, the monies in the state lottery fund shall be expended for the
expenses of the commission incurred in carrying out its powers and duties and
in the operation of the lottery.
B. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsection A
of this section, $10,000,000 shall be deposited in the Arizona game and fish
commission heritage fund established by section 17-297.
C. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsections A
and B of this section, $5,000,000 shall be allocated to the department of child
safety for the healthy families program established by section 8-481,
$4,000,000 shall be allocated to the Arizona board of regents for the Arizona
area health education system established by section 15-1643, $3,000,000
shall be allocated to the department of health services to fund the teenage pregnancy
prevention programs established in Laws 1995, chapter 190, sections 2 and 3
$2,000,000 shall be allocated to the department of health services for the
health start program established by section 36-697, $2,000,000 shall be
deposited in the disease control research fund established by section 36-274
, $1,300,000 shall be deposited in the problem gambling fund
established by section 5-1318.01, $1,300,000 shall be allocated to the
department of gaming division of problem gambling for treatment and prevention
of problem gambling and problem gambling education programs
and
$1,000,000 shall be allocated to the department of health services for the
federal women, infants and children food program. The allocations in
this subsection shall be adjusted annually according to changes in the GDP
price deflator as defined in section 41-563, and the allocations are
exempt from the provisions of section 35-190 relating to lapsing of
appropriations. If there are not sufficient monies available
pursuant to this subsection, the allocation of monies for each program shall be
reduced on a pro rata basis.
D. If the state lottery director determines that
monies available to the state general fund may not equal $84,150,000 in a
fiscal year, the director shall not authorize deposits to the Arizona game and
fish commission heritage fund pursuant to subsection B of this section
until
the deposits to the state general fund equal $84,150,000 in a fiscal year.
E. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsections A
through D of this section, $1,000,000 or the remaining balance in the fund,
whichever is less, is appropriated to the department of economic
security for grants to nonprofit organizations, including faith-based
organizations, for homeless emergency and transitional shelters and related
support services. The department of economic security shall submit a
report on the amounts, recipients, purposes and results of each grant to the
governor, the speaker of the house of representatives and the president of the
senate on or before December 31 of each year for the prior fiscal year and
shall provide a copy of this report to the secretary of state.
F. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsections A
through E of this section, and after a total of at least $99,640,000 has
been deposited in the state general fund, $1,750,000 shall be deposited in the
Arizona competes fund established by section 41-1545.01. The
balance in the state lottery fund remaining after deposits into the Arizona
competes fund shall be deposited in the university capital improvement lease-to-own
and bond fund established by section 15-1682.03, up to a maximum of
eighty percent of the total annual payments of lease-to-own and bond agreements
entered into by the Arizona board of regents.
G. All monies remaining in the state lottery fund
after the appropriations and deposits authorized in this section shall be
deposited in the state general fund.
H. Except for monies expended for debt service of
revenue bonds as provided in subsection A of this section, monies expended
under subsection A of this section are subject to legislative appropriation.
I. The commission shall transfer monies prescribed
in this section on a quarterly basis.
END_STATUTE
Sec. 2. Section 5-572, Arizona Revised
Statutes, as amended by Laws 2024, chapter 210, section 3, is amended to read:
START_STATUTE
5-572.
Use of monies in state lottery fund; report
A. If there are any bonds or bond related
obligations payable from the state lottery revenue bond debt service fund, the
state lottery revenue bond debt service fund shall be secured by a first lien
on the monies in the state lottery fund after the payment of operating costs of
the lottery, as prescribed in section 5-555, subsection A, paragraph 1,
until the state lottery bond debt service fund contains sufficient monies to
meet all the requirements for the current period as required by the bond
documents. Debt service for revenue bonds issued pursuant to this
chapter shall be paid first from monies that would have otherwise been
deposited pursuant to this section in the state general fund. After
the requirements for the current period have been satisfied as required by the
bond documents, the monies in the state lottery fund shall be expended for the
expenses of the commission incurred in carrying out its powers and duties and
in the operation of the lottery.
B. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsection A
of this section, $10,000,000 shall be deposited in the Arizona game and fish
commission heritage fund established by section 17-297.
C. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsections A
and B of this section, $5,000,000 shall be allocated to the department of child
safety for the healthy families program established by section 8-481,
$4,000,000 shall be allocated to the Arizona board of regents for the Arizona
area health education system established by section 15-1643, $3,000,000
shall be allocated to the department of health services to fund the teenage pregnancy
prevention programs established in Laws 1995, chapter 190, sections 2 and 3,
$2,000,000 shall be allocated to the department of health services for the
health start program established by section 36-697, $2,000,000 shall be
deposited in the disease control research fund established by section 36-274
, $1,300,000 shall be deposited in the problem gambling fund
established by section 5-1318.01, $1,300,000 shall be allocated to the
department of gaming division of problem gambling for treatment and prevention
of problem gambling and problem gambling education programs
and
$1,000,000 shall be allocated to the department of health services for the
federal women, infants and children food program. The allocations in
this subsection shall be adjusted annually according to changes in the GDP
price deflator as defined in section 41-563, and the allocations are
exempt from the provisions of section 35-190 relating to lapsing of
appropriations. If there are not sufficient monies available
pursuant to this subsection, the allocation of monies for each program shall be
reduced on a pro rata basis.
D. If the state lottery director determines that
monies available to the state general fund may not equal $84,150,000 in a
fiscal year, the director shall not authorize deposits to the Arizona game and
fish commission heritage fund pursuant to subsection B of this section until
the deposits to the state general fund equal $84,150,000 in a fiscal year.
E. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsections A
through D of this section, $1,000,000 or the remaining balance in the fund,
whichever is less, is appropriated to the department of economic
security for grants to nonprofit organizations, including faith-based
organizations, for homeless emergency and transitional shelters and related
support services. The department of economic security shall submit a
report on the amounts, recipients, purposes and results of each grant to the
governor, the speaker of the house of representatives and the president of the
senate on or before December 31 of each year for the prior fiscal year and
shall provide a copy of this report to the secretary of state.
F. Of the monies remaining in the state lottery fund
each fiscal year after appropriations and deposits authorized in subsections A
through E of this section, and after a total of at least $99,640,000 has
been deposited in the state general fund, $3,500,000 shall be deposited in the
Arizona competes fund established by section 41-1545.01. The
balance in the state lottery fund remaining after deposits into the Arizona
competes fund shall be deposited in the university capital improvement lease-to-own
and bond fund established by section 15-1682.03, up to a maximum of
eighty percent of the total annual payments of lease-to-own and bond agreements
entered into by the Arizona board of regents.
G. All monies remaining in the state lottery fund
after the appropriations and deposits authorized in this section shall be
deposited in the state general fund.
H. Except for monies expended for debt service of
revenue bonds as provided in subsection A of this section, monies expended
under subsection A of this section are subject to legislative appropriation.
I. The commission shall transfer monies prescribed
in this section on a quarterly basis.
END_STATUTE
Sec. 3. Section 5-1305, Arizona Revised
Statutes, is amended to read:
START_STATUTE
5-1305.
License review; approval; fees; material change; exemption;
display; transferability
A. On receipt of a completed application and the
required fee, the department shall conduct the necessary background
investigation to ensure the applicant is qualified for licensure.� On
completion of the necessary background investigation, the department shall
either issue a license or deny the application.� If the application is denied,
the department shall forward a statement setting forth the grounds for denial
to the applicant together with all other documents on which the department relied,
to the extent allowed by law.
B. The department may conduct additional background
investigations of any person required to be licensed at any time while the
license remains valid.� The issuance of a license does not create or imply a
right of employment or continued employment. The event wagering
operator or limited event wagering operator may not employ and, if already
employed, shall terminate an event wagering employee if it is determined that
the person meets any of the following criteria:
1. Has been convicted of any gaming offense.
2. Has been convicted of a felony in the seven years
before submitting an application unless that felony has been set aside.
3. Has ever been convicted of a felony related to
extortion, burglary, larceny, bribery, embezzlement, robbery, racketeering,
money laundering, forgery, fraud, murder, voluntary manslaughter, a sexual
offense that requires the individual to register pursuant to section 13-3821
or kidnapping.
4. Knowingly and wilfully provides materially
important false statements or information or omits materially important
information on the person's employment application or background questionnaire.
5. Is a person whose prior activities, criminal
record, if any, or reputation, habits and associations pose a threat to the
public interest or to the effective regulation and control of gaming or create
or enhance the dangers of unsuitable, unfair or illegal practices, methods and
activities in the conduct of gaming or the carrying on of the business and
financial arrangements incidental thereto.
C. Not later than sixty days after the department
receives a complete application, the department shall issue a license to the
applicant unless the background investigation the department conducts discloses
that the applicant has a criminal history or unless other grounds sufficient to
disqualify the applicant are apparent on the face of the
application. If more than ten applications are received for a
particular license type, the department shall adopt a process for ensuring an
equal opportunity for all qualified applicants to obtain a license.� The
department shall review and approve or deny an application for a license as
provided in title 41, chapter 6, article 10.
D. For each application for licensure or renewal of
a license that is approved under this section, the amount of the application
fee must be credited toward the licensee's license fee and the licensee shall
remit the balance of the initial license fee to the department on approval of a
license. The fees collected from licensees under this section shall
be deposited in the event wagering fund established by section 5-1318 and
used by the department to pay the actual operating and administrative expenses
incurred for event wagering.
E. Each person licensed under this chapter shall
give the department written notice within thirty days after a material change
is made to information provided in the licensee's application for a license or
renewal.
F. Indian tribes within this state
that
are
operating event wagering exclusively on Indian lands are exempt from
the licensure requirements of this section. Event wagering on Indian
lands is governed by the tribal-state gaming compact, its appendices, any
amendments and the Indian gaming regulatory act (P.L. 100-497; 102 stat. 2467).
G. Each licensee
shall display its license conspicuously in the licensee's place of business or
have the license available for inspection by an agent of the department or a
law enforcement agency.� Each licensee that operates an event wagering platform
shall conspicuously display a notice of the license on its platform's landing
page.
H. The department shall keep
confidential
all information, records, interviews, reports, statements, memoranda or
other data supplied to or used by the department in the course of its review or
investigation of an application for an event wagering operator license or
renewal of a license
confidential
.
The department shall immediately release any materials described in
this subsection to any member of the legislature on written request.
The
materials described in this subsection are
not
exempt
from disclosure
in compliance with a court order, subpoena,
statutory audit or
pursuant to title 39, chapter 1, article 2.
I. A license issued under this chapter may not be
transferred to another person or entity without prior approval of the
department. The department shall work with applicants and licensees
to ensure there is no gap in the validity of the license.
END_STATUTE
Sec. 4. Title 5, chapter 11, article 1, Arizona
Revised Statutes, is amended by adding section 5-1318.01, to read:
START_STATUTE
5-1318.01.
Problem gambling fund; fees
A. The problem gambling fund is
established consisting of monies deposited pursuant to section 5-572 and
subsection b of this section and from any other source. The
department shall administer the fund. monies in the fund are
continuously appropriated
b. Except as otherwise provided in
this chapter, the department shall establish a problem gambling fee and require
each licensed event wagering operator that is licensed to operate both mobile
event wagering and retail event wagering pursuant to section 5-1304,
subsection a, paragraph 1 to quarterly pay to the department the fee.
C. The monies in the problem gambling
fund shall fund the division of problem gambling established within the
department.� The division will use monies in the fund to do both of the
following:
1. Address prevention and treatment
of problem gambling and gambling addiction.
2. establish education programs
relating to problem gambling.
END_STATUTE
Sec. 5.
Effective date
Section 5-572, Arizona Revised
Statutes, as amended by Laws 2024, chapter 210, section 3 and this act, is
effective from and after June 30, 2027.
Sec. 6.
Legislative intent; definition
A. The
legislature intends that the department of gaming set the problem gambling fee
prescribed in section 5-1318.01, Arizona Revised Statutes, as added by
this act, at an amount of at least three percent of the event wagering
operator's adjusted gross annual event wagering receipts.
B. For the purposes of this
section, "adjusted gross annual event wagering receipts" means the
gross event wagering receipts that are derived from wagers minus all winnings
paid to players and before any deductions are made, including free bet
reductions.