Wyoming lottery for education.

WORKING DRAFT
2009
STATE OF
WYOMING
09LSO-0321

HOUSE BILL
NO.
HB0170

Wyoming
lottery for education.

Sponsored by:
Representative(s) Wallis, Bagby, Blake, Byrd, Craft, Illoway and Pedersen and Senator(s) Decaria and Ross

A BILL

for

AN ACT relating to
lotte
r
ies; creating the Wyoming lottery corporation; providing for membership of the board; providing legislative declarations; providing definitions; providing powers and duties; providing for an advisory board; providing for rules and regulations; providing for use of proceeds for educational
and other
purposes;
providing limitations on retailers;
providing for collection of monies owed state agencies from lottery winnings; providing
for criminal offenses and
penalties; providing for background checks;
and providing for an effective date.

Be It Enacted by the Legislature of the State of
Wyoming
:

Section 1.
W.S. 21
‑
24
‑
101 through 21
‑
24
‑
131 and 21
‑
24
‑
201 through 21
‑
24
‑
20
6
are created to read:

CHAPTER 24
LOTTERY

ARTICLE 1
WYOMING
LOTTERY FOR EDUCATION

21
‑
24
‑
101.

Short title.

This chapter shall be known and may be cited as the
"
Wyoming
Lottery for Education Act.
"

21
‑
24
‑
102.

Legislative findings and declarations.

(a)

It is found and declared by the
l
egislature:

(i)

That net proceeds of lottery games conducted pursuant to this chapter shall be used to support improvements and enhancements for educational purposes and programs and that such net proceeds shall be used to supplement, not supplant, existing resources for educational purposes and programs;

(ii)

That lottery games are an entrepreneurial enterprise and that the state shall create a public body, corporate and politic, known as the Wyoming
l
ottery
c
orporation, with comprehensive and extensive powers as generally exercised by corporations engaged in entrepreneurial pursuits;

(iii)

That lottery games shall be operated and managed in a manner which provides continuing entertainment to the public, maximizes revenues and ensures that the lottery is operated with integrity and dignity and free of political influence; and

(iv)

That the
Wyoming

l
ottery
c
orporation shall be accountable to the
l
egislature and to the public through a system of audits and reports.

21
‑
24
‑
103.

Definitions.

(a)

As used in this chapter:

(i)

"
Administrative expenses
"
means operating expenses, excluding amounts set aside for prizes, regardless of whether such prizes are claimed and excluding amounts held as a fidelity fund pursuant to W.S.
21
‑
24
‑
117
;

(ii)

"
Board
"
means the board of directors of the
Wyoming

l
ottery
c
orporation;

(iii)

"Central control computer" means a central site computer controlled by the corporation to which all lottery terminals in the state including video lottery terminals communicate for purposes established by the
corporation
;

(i
v
)

"
Chief executive officer
"
means the chief executive officer of the
Wyoming

l
ottery
c
orporation;

(v)

"
Corporation
"
means the
Wyoming

l
ottery
c
orporation;

(
v
i
)

"
Lotte
ry,
"

"
lotteries,
"

"
lottery game
"
or
"
lottery games
"
means any game of chance

approved by the board and operated pursuant to this
article
, including, but not limited to, instant
tickets,
multi-state games, scratch-off tickets and video lottery terminals,
but excluding pari-mutuel
wagering
and
Class III or
casino gambling
;

(vi
i
)

"
Major procurement contract
"
means any gaming product or service costing in excess of seventy-five thousand dollars ($75,000.00) including, but not limited to, major advertising contracts, annuity contracts, prize payment agreements, consulting services, equipment, tickets and other products and services unique to the Wyoming lottery, but not including materials, supplies, equipment and services common to the ordinary operation of a corporat
e entity
;

(
v
i
i
i
)

"
Member
"
or
"
members
"
means a director or directors of the board of directors of
the
Wyoming

l
ottery
c
orporation;

(
i
x
)

"
Net proceeds
"
means all revenue derived from the sale of lottery tickets or shares

and all other
monies
derived from the
lottery less operating expenses;

(
x
)

"
Operating expenses
"
means all costs of doing business, including, but not limited
to
commissions
and other compensation paid to retailers, advertising and marketing costs, personnel costs, capital costs, depreci
ation of property and equipment
and other operating costs
but does not include prizes, payments to the state under W.S.
21
‑
24
‑
112
(d)
,
unclaimed prize monies set aside under W.S. 21
‑
24
‑
122(g)
or amounts set aside for the
pari-mutuel
commission under W.S.
21
‑
24
‑
112(c)
;

(
x
i
)

"
Pari-mutuel
wagering
"
means
as defined in W.S. 11
‑
25
‑
102
;

(
x
i
i
)

"
Retailer
"
means a person who sells lottery tickets or shares on behalf of the

corporation pursuant to a contra
ct;

(
x
i
i
i
)

"
Share
"
means any intangible evidence of
participation in a lottery game;

(
x
i
v
)

"
Ticket
"
means any tangible evidence issued by the lottery to provide participation
in a lottery game
;

(xv)

"
Video l
ottery terminal
"
or
"
terminal
"
means an electronic machine or other device which,
up
on insertion of coin, currency, voucher or electronic ticket plays or simulates the play of lottery games as authorized by the corporation and interfaces to a central control computer and by chance, delivers or entitles the player to receive cash, premiums, free games, merchandise, tokens or anything of value whether the payout is made automatically from the device or in any other manner approved by the corporation
.

21
‑
24
‑
104.

Wyoming lottery c
orporation created;
membership of board of directors; appointment; terms; filling of vacancies; conflict of interests; reimbursement for expenses; officers; quorum
.

(a)

There is created a body corporate and politic to be known as the
Wyoming

l
ottery

c
orporation which shall be deemed to be an instrumentality of the state, and not a state agency, and a public corporation.

(
b
)

The corporation shall be governed by a board of directors composed of
nine
(
9
)
members
as follows:

(i)

Four (4) members appointed by the governor
;

(ii
)

The president of the pari-mutuel commission or his designee
;

(i
ii
)

Two
(2)
members appointed by the president of the senate; and

(
i
v)

Two
(2)
members appointed by the speaker of the house of representatives
.

(
c
)

Members shall be residents of the
s
tate of
Wyoming
, shall be prominent persons in

their businesses or professions, and shall not have been convicted of any felony offense.

(
d
)

Members shall serve terms of five
(5)
years, except that of the initial members appointed,

the
three
(3)

members specified in paragraphs (b)(i) through (iii)
shall be appointed for initial terms of two
(2)
years,
the
two
(2)
members appointed by the president of the senate
shall be appointed for initial terms of four
(4)
years and
the
two
(2)
members appointed by the speaker of the house of representatives
shall be appointed for initial terms of five
(5)
years.

(
e
)

Members of the board shall not have any direct or indirect interest in an undertaking

that puts their personal interest in conflict with that of the corporation, including, but not limited to, an interest in a major procurement contract or a participating retailer.

(
f
)

Each
member
shall
only
receive compensation
from the corporation
for each day or part of a day in which engaged in the performance of their official duties at the same
salary and per diem
provided members of the state legislature under W.S. 28
‑
5
‑
101 and shall be reimbursed for actual and necessary expenses incurred in the perfo
rmance of their official duties
.

Members shall receive no other compensation from the corporation.

(
g
)

The members shall elect from their membership a chair
man
and vice chair
man
.

The members shall also elect a secretary and treasurer who
may
be the chief executive officer of the corporation.

Such officers shall serve for such terms as shall be prescribed by the bylaws of the corporation or until their respective successors are elected and qualified.

No member of the board shall hold more than any one
(1)
office of the corporation, except that the same person may serve as secretary and treasurer.

(
h
)

The board of directors may delegate to any one

(1)
or more of its members, to the chief

executive officer or to any agent or employee of the corporation such powers and duties as it may deem proper.

(
j
)

A majority of members in office shall constitute a quorum for the transaction of any

business and for the exercise of any power or function of the corporation.

(
k
)

Action may be taken and motions and resolutions adopted by the board at any meeting

thereof by the affirmative vote of a majority of present and voting board members.

(
m
)

No vacancy in the membership of the board shall impair the right of the members to

exercise all the powers and perform all the duties of the board.

21
‑
24
‑
105.

Lottery
r
etailer
a
dvisory
b
oard.

(a)

The chair
man
of the board of directors shall appoint a
l
ottery
r
etailer
a
dvisory
b
oard to be composed of ten
(10)
lottery retailers representing the broadest possible spectrum of geographical and business characteristics of lottery retailers.

The function of the advisory board shall be to advise the board of directors on retail aspects of the lottery and to present the concerns of lottery retailers throughout the state.

(b)

Members appointed to the
lottery retailer advisory board
shall serve terms of two
(2)
years
,
provided, however, that five
(5)
of the initial appointees shall serve initial terms of one
(1)
year.

(c)

The advisory board shall establish its own rules and internal operating procedures.

Members of the advisory board shall serve without compensation or reimbursement of expenses.

The advisory board may report to the board of directors in writing at any time.

The board of directors may invite the advisory board to make an oral presentation to the board of directors at regular meetings of the board.

21
‑
24
‑
106.

General duties of board of directors.

(a)

The board of directors shall provide the chief executive officer with private

sector

perspectives of a large marketing enterprise.

The board shall:

(
i
)

Approve, disapprove, amend or modify the budget recommended by the chief

executive officer for the operation of the corporation;

(
ii
)

Approve, disapprove, amend or modify the terms of major lottery procurements

recommended by the chief executive officer;

(
iii)

Hear appeals of hearings required by this chapter;

(
iv
)

Adopt regulations, policies and procedures relating to the conduct of lottery games

and as specified in
W.S.

21
‑
24
‑
109
; and

(
v
)

Perform such other functions as specified by this
chapter
.

21
‑
24
‑
107.

Appointment of chief executive officer; compensation.

The board of directors shall appoint and shall provide for the compensation of a chief

executive officer who shall be an employee of the corporation and who shall direct the day-to-day operations and management of the corporation and shall be vested with such powers and duties as specified by the board and by law.

The chief executive officer shall serve at the pleasure of the board.

21
‑
24
‑
108.

General powers of corporation.

(a)

The corporation shall have any and all powers necessary or convenient to its

usefulness in carrying out and effectuating the purposes and provisions of this
chapter
which are not in conflict with the
c
onstitution of this state and which are generally exercised by corporations engaged in entrepreneurial pursuits, including, but without limiting the generality of the foregoing, the following powers:

(
i
)

To sue and be sued in contract and in tort and to complain and defend in all courts;

(
ii
)

To adopt and alter a seal;

(
iii
)

To adopt, amend and repeal bylaws, regulations and policies and procedures for the

regulation of its affairs
and the conduct of its business,
to elect and prescribe the duties of officers a
nd employees of the corporation
and to perform such other matters as the corporation may determine.

In the adoption of bylaws, regulations, policies and procedures or in the exercise of any regulatory power, the corporation shall be exempt from the requirements of
W.S. 16
‑
3
‑
101 through 16
‑
3
‑
115
;

(
iv
)

To procure or to provide insurance;

(
v
)

To hold copyrights, trademarks and service marks and enforce its rights with respect

thereto;

(
vi
)

To initiate, supervise and administer the operation of the lottery in accordance with

the provisions of this chapter and regulations, policies and procedures adopted pursuant thereto;

(
vii
)

To enter into written agreements with one
(1)
or more other states or sovereigns for the

operation, participation in marketing and promotion of a joint lottery or joint lottery games;

(
viii
)

To conduct such market research as is necessary or appropriate, which may include an

analysis of the demographic characteristics of the players of each lottery game and an analysis of advertising, promotion, public relations, incentives and other aspects of communication;

(
ix
)

To acquire or lease real property and make improvements thereon and acquire by

lease or by purchase personal property, including, but not limited to, computers
,
mechanical, electronic and on-line equipment and terminals
and
intangible property, including, but not limited to, computer programs, systems and software;

(
x
)

To enter into contracts to incur debt in its own name and enter into financing

agreements with the state, agencies or
instrumentalities of the state
or with any commercial bank or credit provider;

(
xi
)

To be authorized to administer oaths, take depositions, issue subpoenas and compel

the attendance of witnesses and the production of books, papers, documents and other evidence relative to any investigation or proceeding conducted by the corporation;

(
xii
)

To appoint and select officers, agents and employees, including professional and

adminis
trative staff and personnel, including
hearing officers to conduct hearings required by this
article,
and to fix their compensation, pay their expenses and provide a benefit program, including, but not limited to, a retirement plan and a group insurance plan;

(
xiii
)

To select and contract with vendors and retailers;

(
xiv
)

To enter into contracts or agreements with state or local law enforcement agencies

for the performance of law enforcement, background investigations and security checks;

(
xv
)

To enter into contracts of any and all types on such terms and conditions as the

corporation may determine;

(
xvi
)

To establish and maintain banking relationships, including, but not limited to,

establishment of checking and savings accounts and lines of credit;

(
xvii
)

To advertise and promote the lottery and lottery games;

(
xviii
)

To act as a retailer, to conduct promotions which involve the dispensing of lottery

tickets or shares and to establish and operate a sales facility to sell lottery tickets or shares and any related merchandise; and

(
xix
)

To adopt and a
mend such regulations, policies
and procedures as necessary to carry

out and implement its powers and duties, organize and operate the corporation, regulate the conduct of lottery games in general and any other matters necessary or desirable for the efficient and effective operation of the lottery or the convenience of the public.

The promulgation of any such regulations, polici
es
and procedures shall be exempt from the requirements of
W.S. 16
‑
3
‑
101 through 16
‑
3
‑
115
.

(b)

The powers enumerated in subsection (a) of this section are cumulative of and

in addition to those powers enumerated elsewhere in this
chapter
and no such powers limit or restrict any other powers of the corporation.

21
‑
24
‑
109.

Adoption by board of procedures regulating conduct of lottery games.

(a)

The board may adopt regulations, policies and procedures regulating the conduct of

lottery games in general, including, but not limited to, regulations, policies and procedures specifying:

(
i
)

The type of games to be conducted, including, but not limited to, instant lotteries,
scratch off ticket games, multi-state,

video lottery terminals
and other games traditional to the lottery.

The conduct of lotteries using video lottery terminals shall be limited as provided in W.S. 21
‑
24
‑
115
;

(
ii
)

The sale price of tickets or shares and the manner of sale
,
provided, however, that all

sales shall be for cash only and payment by checks, credit cards, charge cards or any form of deferred payment is prohibited;

(
iii
)

The number and amount of prizes;

(
iv
)

The method and location of selecting or validating winning tickets or shares;

(
v
)

The manner and time of payment of prizes, which may include lump sum payments or

installments over a period of years;

(
vi
)

The manner of payment of prizes to the holders of winning tickets or shares,

including without limitation provision for payment of prizes not exceeding
six hundred dollars (
$600.00
)
after

deducting the price of the ticket or share and after performing validation procedures appropriate to the game and as specified by the board.

The board may provide for a limited number of retailers who can pay prizes of up to
five thousand dollars (
$5,000.00
)
after performing validation procedures appropriate to the game and as specified by the board without regard to where such ticket or share was purchased;

(
vii
)

The frequency of games and drawings or selection of winning tickets or shares;

(
viii
)

The means of conducting drawings;

(
ix
)

The method to be used in selling tickets or shares, which may include the use

of
video lottery terminals as provided in W.S. 22
‑
24
‑
115
, but such devices may be placed only in locations on the premises of the lottery retailer which are within the view of such retailer or an employee of such retailer.

All
video lottery terminals
shall bear a conspicuous label prohibiting the use of such device by persons
less than

eighteen (
18
)
years of age.

A lottery retailer who knowingly allows a person
less than

eighteen (
18
)
years of age to

purchase a lottery ticket or share from
a

video lottery terminal
shall be subject to the penalties provided in
W.S.

21
‑
24
‑
124
;

(
x
)

The manner and amount of compensation to lottery retailers; and

(
xi
)

Any and all other matters necessary, desirable or convenient toward ensuring the

efficient and effective operation of lottery games, the continued entertainment and convenience of the public and the integrity of the lottery.

21
‑
24
‑
110.

Duties of chief executive officer.

(a)

The chief executive officer of the corporation shall direct and supervise all

administrative and technical activities in accordance with the provisions of this
chapter
and with the regulations, policies and procedures adopted by the board.

It shall be the duty of the chief executive officer to:

(
i
)

Facilitate the initiation and supervise and administer the operation of the lottery

games;

(
ii
)

Employ and direct such personnel as deemed necessary;

(
iii
)

Employ by contract and compensate such persons and firms as deemed necessary;

(
iv
)

Promote or provide for promotion of the lottery and any functions related to the

corporation;

(
v
)

Prepare a budget for the approval of the board;

(
vi
)

Require bond from retailers and vendors in amounts as required by the

board;

(
vii
)

Report quarterly to the state auditor, the
joint revenue
interim
committee
and the board a full and complete statement of lottery revenues and expenses for the preceding quarter; and

(
viii
)

Perform other duties generally associated with a chief executive officer of a

corporation of an entrepreneurial nature.

(b)

The chief executive officer may for good cause suspend, revoke or refuse to renew

any contract entered into in accordance with the provisions of this chapter or the regulations, policies

and procedures of the board.

(c)

The chief executive officer or his designee may conduct hearings and administer oaths

to persons for the purpose of assuring the security or integrity of lottery operations or to

determine the qualifications of or compliance by vendors and retailers.

21
‑
24
‑
111.

Employees; compensation; restrictions; background investigations; bonding.

(a)

The corporation shall establish and maintain a personnel program for its employees

and fix the compensation and terms of compensation of its employees, including, but not limited to, production incentive payments.

(b)

No employee of the corporation shall have a financial interest in any vendor doing

business or proposing to do business with the corporation.

(c)

No employee of the corporation with decision

making authority shall participate in

any decision involving a retailer with whom the employee has a financial interest.

(d)

No employee of the corporation who leaves the employment of the corporation may

represent any vendor or lottery retailer before the corporation for a period of two
(2)
years following termination of employment with the corporation.

(e)

Background investigation shall be conducted on each applicant who has reached the

final selection process prior to employment by the corporation at the level of division director and above and at any level within any division of security and as otherwise required by the board.

The corporation shall be authorized to pay for the actual cost of such investigations and may contract with the
division
of criminal investigation
for the performance of such investigations.

(f)

No person who has been convicted of a felony or bookmaking or other forms of

illegal gambling or of a crime involving moral turpitude shall be employed by the corporation.

(g)

The corporation shall bond corporation employees with access to corporation funds or

lottery revenue in such an amount as provided by the board and may bond other employees as deemed necessary.

21
‑
24
‑
112.

Disposition of lottery proceeds; budget report by
g
overnor; appropriations by
l
egislature.

(a)

As nearly as practical, at least
forty-five
percent
(45%)
of the
net proceeds from the
sale of lottery tickets or shares
but not including sales from video
lottery
terminals
shall be made available as prize money
,
provided, however, that this
subsection
shall be deemed not to create any lien, entitlement, cause of action or other private right and any rights of holders of tickets or shares shall be determined by the corporation in setting the terms of its lottery or lotteries.

(
b
)

Of the annual net proceeds from lottery games attributable to retailers located at
facilities where pari-mutuel events, as defined in W.S. 11
‑
25
‑
102, occur
in
Wyoming
:

(i)

One and one
-
half percent (1 1/2%) shall be
paid to the Wyoming pari-mutuel commission to enhance breeder awards as provided in W.S. 11
‑
25
‑
102(a)(i); and

(ii)

One percent (1%) shall be paid to the
Wyoming
pari-mutuel commission for general operations
;

(iii)

One percent (1%) shall be paid to the
Wyoming
pari-mutuel commission for purposes of funding annual grants exclusively for use in hosting and marketing equestrian events at state and county fairgrounds and licensed pari-mutuel facilities in
Wyoming
.

(
c
)

On or before the fifteenth day of each quarter, the corporation shall transfer to the general fund of the state treasury, for credit to the
l
ottery for
e
ducation
a
ccount, the amount of all net proceeds
minus prizes
and amounts paid pursuant to subsections (b) and (c) of this section
during the preceding quarter.

Upon their deposit into the state treasury, any
monies
representing a deposit of net

proceeds shall then become the unencumbered property of the
s
tate of
Wyoming
and the

corporation shall have no power to agree or undertake otherwise.

Such
monies
shall be invested by the
s
tate
t
reasurer in accordance with state investment practices. All earnings attributable to such investments shall likewise be the unencumbered property of the state and shall accrue to the credit of the
l
ottery for
e
ducation
a
ccount.

(
d
)

Monies in the lottery for education account shall only be appropriated to the Hathaway
scholarship

endowment fund
created under W.S.
9
‑
4
‑
204(u)(vii)
.

(
e
)

N
o deficiency in the
l
ottery for
e
ducation
a
ccount shall be replenished by book entries reducing any nonlottery reserve of general funds
,
nor shall any program or project started specifically from lottery proceeds be continued from the general fund
. S
uch programs
shall
be adjusted or discontinued according to available lottery proceeds unless the
l
egislature by general law establishes eligibility requirements and appropriates specific funds within the
budget
.

N
or shall any nonlottery surplus in the general fund be reduced.

No surplus in the
l
ottery for
e
ducation
a
ccount shall be reduced to correct any nonlottery deficiencies in sums available for general appropriations.

21
‑
24
‑
113.

Investigation of vendors; disclosure requirements; restrictions on entry into
major procurement contract
s.

(a)

The corporation shall investigate the financial responsibility, security and integrity of

any lottery system vendor who is a finalist in submitt
ing a bid, proposal or offer
.

At the time of submitting such bid, proposal or offer to the corporation, the corporation may require the following items:

(
i
)

A disclosure of the vendor
'
s name and address and, as applicable, the names and

addresses of the following:

(A)

If the vendor is a corporation, the officers, directors and each stockholder in such

corporation
,
provided, however, that in the case of owners of equity securities of a publicly traded corporation, only the names and addresses of those known to the corporation to own beneficially
five
percent
(5%)
or more of such securities need be disclosed;

(B)

If the vendor is a trust, the trustee and all persons entitled to receive income or

benefits from the trust;

(C)

If the vendor is an association, the members, officers and directors; and

(D)

If the vendor is a partnership or joint venture, all of the general partners, limited
p
artners
or joint venturers.

(
ii
)

A disclosure of all the states and jurisdictions in which the vendor does business and

the nature of the business for each such state or jurisdiction;

(
iii
)

A disclosure of all the states and jurisdictions in which the vendor has contracts to

supply gaming goods or services, including, but not limited to, lottery goods and services and the nature of the goods or services involved for each such state or jurisdiction;

(
iv
)

A disclosure of all the states and jurisdictions in which the vendor has applied for, has

sought renewal of, has received, has been denied, has pending or has had revoked a lottery or gaming license of any kind or had fines or penalties assessed to his license, contract or operation and the disposition in each such state or jurisdiction.

If any lottery or gaming license or contract has been revoked or has not been renewed or any lottery or gaming license or application has been either denied or is pending and has remained pending for more than six
(6)
months, all of the facts and circumstances underlying the failure to receive
the
license shall be disclosed;

(
v
)

A disclosure of the details of any finding or plea, conviction or adjudication of guilt

in a state or federal court of the vendor for any felony or any other criminal offense other than a traffic violation;

(
vi
)

A disclosure of the details of any bankruptcy, insolvency, reorganization or corporate

or individual purchase or takeover of another corporation, including bonded indebtedness, or any pending litigation of the vendor; and

(
vii
)

Such additional disclosures and information as the corporation may determine to be

appropriate for the procurement involved.

If at least
twenty-five
percent
(25%)
of the cost of a vendor
'
s contract is subcontracted, the vendor shall disclose all of the information required by this section for the subcontractor as if the subcontractor were itself a vendor.

(b)

A lottery
major procurement contract
shall not be entered into with any lottery system

vendor who has not complied with the disclosure requirements described in subsection (a) of this section and any contract with such a vendor is voidable at the option of the corporation.

Any contract with a vendor who does not comply with such requirements for periodically updating such disclosures during the tenure of contract as may be specified in
the
contract may be terminated by the corporation.

The provisions of this section shall be construed broadly and liberally to achieve the ends of full disclosure of all information necessary to allow for a full and complete evaluation by the corporation of the competence, integrity, background and character of vendors for procurements.

(c)

A
major procurement contract
shall not be entered into with any vendor who has been

found guilty of a felony related to the security or integrity of the lottery in this or any other jurisdiction.

(d)

A
major procurement contract
shall not be entered into with any vendor if such

vendor has an ownership interest in an entity that had supplied consultation services under contract to the corporation regarding the request for proposals pertaining to those particular goods or services.

(e)

No lottery system vendor nor any applicant for a
major procurement contract
may

pay, give

or make any economic opportunity, gift, loan, gratuity, special discount, favor,

hospitality or service, excluding food and beverages having an aggregate value not exceeding
one hundred dollars (
$100.00
)
in any calendar year, to the chief executive officer, any board member or any employee of the corporation or to a member of the immediate family residing in the same household as any such person.

21
‑
24
‑
114.

Bonding requirements for vendors; qualifications of vendors; competitive bid requirement.

(a)

Each vendor shall, at the execution of the contract with the corporation, post a

performance bond or letter of credit from a bank or credit provider acceptable to the corporation in an amount as deemed necessary by the corporation for that particular bid or contract.

In lieu of the bond, a vendor may, to assure the faithful performance of its obligations, deposit and maintain with the corporation securities that are interest bearing or accruing and that are rated in one
(1)
of the three
(3)
highest classifications by an established nationally recognized investment rating service.

Securities eligible under this section are limited to:

(
i
)

Certificates of deposit issued by solvent banks or savings associations approved by

the corporation and which are organized and existing under the laws of this state or under the laws of the
United States
;

(
ii
)

United States
bonds, notes and bills for which the full faith and credit of the

government of the
United States
is pledged for the payment of principal and interest; and

(
iii
)

Corporate bonds approved by the corporation.

The corporation which issued the

bonds shall not be an affiliate or subsidiary of the depositor.

Such securities shall be held in trust and shall have at all times a market value at least equal to the full amount estimated to be paid annually to the lottery vendor under contract.

(b)

Each vendor shall be qualified to do business in this state.

All contracts under this
chapter
shall be governed by the laws of this state.

(c)

No contract shall be let with any vendor in which a public official has an ownership interest of
ten
percent
(10%)
or more.

(d)

All
major procurement contract
s
shall
be competitively bid pursuant to policies and

procedures approved by the board unless there is only one
(1)
qualified vendor and that vendor has an exclusive right to offer the service or product.

21
‑
24
‑
115.

State
wide network of retailers; commissions; certificate of authority; qualifications of retailers; fees for outlets; review of activities; gifts or gratuities
;
rules regarding
placement of video lottery terminals
and video lottery terminal retailers
.

(a)

The
l
egislature recognizes that to conduct a successful lottery, the corporation
needs to
develop and maintain a state
wide network of lottery retailers that will serve the public convenience and promote the sale of tickets or shares and the playing of lottery games while ensuring the integrity of the lottery operations, games and activities.

(b)

The corporation
shall
make every effort to provide small retailers a chance to

participate in the sales of lottery tickets or shares.

(c)

Except as provided in subsection (g) of this section, t
he corporation shall provide for compensation to lottery retailers in the form of

commissions in an amount of not less than
five
percent
(5%)
of gross sales and may provide for other forms of compensation for services rendered in the sale or cashing of lottery tickets or shares.

(d)

The corporation shall issue a certificate of authority to each person with whom it

contracts as a retailer for purposes of display.

Every lottery retailer shall post and keep

conspicuously displayed in a location on the premises accessible to the public its certificate of authority.

No certificate shall be assignable or transferable.

(e)

The board shall develop a list of objective criteria upon which the qualification of

lottery retailers shall be based.

Additional
criteria
governing the selection of retailers using video lottery terminals shall be as provided in subsection (g) of this section
.

In developing these criteria, the board shall consider such factors as the applicant
'
s financial responsibility, security of the applicant
'
s place of business or activity, accessibility to the public, integrity and reputation.

The board shall not consider political affiliation, activities or monetary contributions to political organizations or candidates for any public office.

The criteria shall include but not be limited to the following:

(
i
)

The applicant shall be current in filing all
applicable tax returns to the s
tate of

Wyoming
and in payment of all taxes, interest and penalties owed to the
s
tate of
Wyoming
, excluding items under formal appeal pursuant to applicable statutes.

The
d
epartment of
r
evenue
is authorized and directed to provide this information to the corporation;

(
ii
)

No person, partnership, unincorporated association, corporation or other

business entity shall be selected as a lottery retailer who:

(A)

Has been convicted of a criminal offense related to the security or integrity of the

lottery in this or any other jurisdiction;

(B)

Has been convicted of any illegal gambling activity, false statement, false swearing

or perjury in this or any other jurisdiction or convicted of any crime punishable by more than one
(1)
year imprisonment or a fine of more than
one thousand dollars

(
$1,000.00
)
or both unless the person
'
s civil rights have been restored and at least five
(5)
years have elapsed from the date of the completion of the sentence without a subsequent conviction of a crime described in this subparagraph;

(C)

Has been found to have violated the provisions of this
chapter
or any regulation,

policy or procedure of the corporation unless either ten
(10)
years have passed since the violation or the board finds the violation both minor and unintentional in nature;

(D)

Is a vendor or any employee or agent of any vendor doing business with the

corporation;

(E)

Resides in the same household as an officer of the corporation;

(F)

Has made a statement of material fact to the corporation knowing such statement to

be false; or

(G)

Is engaged exclusively in the business of selling lottery tickets or shares
,
provided,

however, that this subsection shall not preclude the corporation from selling or giving away lottery tickets or
shares for promotional purposes.

(
iii
)

Persons applying to become lottery retailers shall be charged a uniform application

fee for each lottery outlet.

Retailers who participate in on-line games shall be charged a uniform application fee for each on-line outlet;

(
iv
)

Any lottery retailer contract executed pursuant to this section may, for good

cause, be suspended, revoked or terminated by the chief executive officer or his designee if the retailer is found to have violated any provision of this chapter or objective criteria established by the board.

Review of such activities shall be in accordance with the procedures outlined in this chapter and shall not be subject to
W.S. 16
‑
3
‑
101 through 16
‑
3
‑
115
; and

(
v
)

All lottery retailer contracts may be renewable annually in the discretion of the

corporation unless sooner cance
l
led or terminated.

(f)

No lottery retailer or applicant to be a lottery retailer shall pay, give or make

any economic opportunity, gift, loan, gratuity, special discount, favor, hospitality or service, excluding food and beverages having an aggregate value not exceeding
one hundred dollars

(
$100.00
)
in any calendar year, to the chief executive officer, any board member or any employee of the corporation or to a member of the immediate family residing in the same household as any such person.

(g)

Certificates of authority shall only be issued for v
ideo lottery terminals located at pari-mutu
e
l racetrack
s
in the state,
where the retailer is
licensed by the
Wyoming
pari-mutu
e
l commission
and
where live races are conducted. Video lottery terminals shall only be placed on the premises where live races are conducted. The board shall develop
objective
criteria, in addition to the criteria provided in subsection (e) of this section, applying to the conduct, fees and bonding requirements of retailers
authorized
to place video lottery terminals.
The following provisions apply exclusively to video lottery terminal retailers:

(i)

Video lottery terminal retailers shall pay an initial application fee of not less than one million dollars ($1,000,000.00) for each par
i-
mutu
e
l race track wherein video lottery terminals will be located. The amount of the initial application fee shall be commensurate with the scale of the operation, and on a schedule which shall be established by the corporation;

(ii)

Video lottery terminal retailers may purchase, lease or otherwise provide under service agreement their own video lottery terminals which shall be connected with the corporation's central control computer in a manner that ensures the integrity of the corporation's system;

(iii)

The corporation shall provide for the compensation to lottery retailers in the form of commission in an amount of not
more
than
sixty-eight
percent (6
8
%) of gross sales and may provide for other forms of compensation for services rendered in the sale or cashing of lottery tickets or shares. Video lottery terminal retailers shall provide four percent (4%) of their commission on gross sales to a segregated purse account to be used to supplement purses at the pari-mutuel race track facility wherein the video lottery terminals are located.

21
‑
24
‑
116.

Retailer contracts not transferable or assignable; restriction on contracts and sales.

(a)

No lottery retailer contract shall be transferable or assignable.

No lottery retailer shall

contract with any person for lottery goods or services except with the approval of the board.

(b)

Lottery tickets and shares shall only be sold by the retailer stated on the lottery

retailer certificate.

21
‑
24
‑
117.

Fidelity fund for retailers; assessments.

(a)

The corporation may establish a fidelity fund separate from all other funds and shall

assess each retailer a one
(1)
time fee not to exceed
one hundred dollars (
$100.00
)
per sales location.

The corporation is authorized to invest the funds or place such funds in one
(1)
or more interest

bearing accounts.

Monies
deposited to the fund may be used to cover losses the corporation experiences due to nonfeasance, misfeasance or malfeasance of a lottery retailer.

In addition, the funds may be used to purchase blanket bonds covering the
W
yoming

l
ottery
c
orporation against losses from all retailers.

At the end of each fiscal year, the corporation shall pay to the general lottery fund any amount in the fidelity fund which exceeds
five hundred thousand dollars (
$500,000.00
)
and such funds shall be commingled with and treated as net proceeds from the lottery.

(b)

A reserve account may be established as a general operating expense to cover

amounts deemed uncollectible. The corporation shall establish procedures for minimizing any losses that may be experienced for the foregoing reasons and shall exercise and exhaust all available options in such procedures prior to amounts being written off to this account.

(c)

The corporation may require any retailer to post an appropriate bond, as determined

by the corporation, using an insurance company acceptable to the corporation. The amount
shall
not exceed the applicable district sales average of lottery tickets for two
(2)
billing periods.

(d)

In its discretion, the corporation may allow a retailer to deposit and maintain with the corporation securities
, held in trust in the name of th
e
Wyoming
l
ottery
c
orporation,
that are interest bearing or accruing. Securities eligible under this
subsection
shall be limited to:

(
i
)

Certificates of deposit issued by solvent banks or savings associations organized and

existing under the laws of this state or under the laws of the
United States
;

(
ii
)

United States
bonds, notes
and bills for which the full faith and credit of the
United

States
is pledged for the payment of principal and interest;

(
iii
)

Federal agency securities by an agency or instrumentality of the
United States

government.

21
‑
24
‑
118.

Cancellation, suspension, revocation or termination of retail contracts.

(a)

Any retail contract executed by the corporation pursuant to this chapter shall specify

the reasons for which a contract may be cancel
l
ed, suspended, revoked or terminated by the corporation, which reasons shall include but not be limited to:

(
i
)

Commission of a violation of this chapter, a regulation or a policy or procedure of the

corporation;

(
ii
)

Failure to accurately or timely account for lottery tickets, lottery games, revenues or

prizes as required by the corporation;

(
iii
)

Commission of any fraud, deceit or misrepresentation;

(
iv
)

Insufficient sales;

(
v
)

Conduct prejudicial to public confidence in the lottery;

(
vi
)

The retailer filing for or being placed in bankruptcy or receivership;

(
vii
)

Any material change as determined in the sole discretion of the corporation in any

matter considered by the corporation in executing the contract with the retailer; or

(
viii
)

Failure to meet any of the objective criteria established by the corporation pursuant to

this chapter.

(b)

If, in the discretion of the chief executive officer or his designee
,
cancellation, denial,

revocation, suspension or rejection of renewal of a lottery retailer contract is in the best interest of the lottery, the public welfare or the
s
tate of Wyoming, the chief executive officer or his designee may cancel, suspend, revoke or terminate, after notice and a right to a hearing, any contract issued pursuant to this chapter.
The
contract may, however, be temporarily suspended by the chief executive officer or his designee without prior notice pending any prosecution, hearing or investigation, whether by a third party or by the chief executive officer.

A contract may be suspended, revoked or terminated by the chief executive officer or his designee for any one
(1)
or more of the reasons enumerated in this section.

Any hearing held shall be conducted by the chief executive officer or his designee.

A party to the contract aggrieved by the decision of the chief executive officer or his designee may appeal the adverse decision to the board.

Such appeal shall be pursuant to the regulations, policies, and procedures set by the board and is not

subject to
W.S. 16
‑
6
‑
101 through 16
‑
3
‑
115
.

21
‑
24
‑
119.

Preservation of lottery proceeds by retailers; accounting procedures; preference accorded proceeds of insolvent retailers.

(a)

All proceeds from the sale of the lottery tickets or shares shall constitute a trust fund

until paid to the corporation either directly or through the corporation
'
s authorized collection representative.

A lottery retailer and officers of a lottery retailer
'
s business shall have a fiduciary duty to preserve and account for lottery proceeds and lottery retailers shall be personally liable for all proceeds.

Proceeds shall include unsold instant tickets received by a lottery retailer and cash proceeds of the sale of any lottery products, net of allowable sales commissions and credit for lottery prizes sold to or paid to winners by lottery retailers.

Sales proceeds and unused instant tickets shall be delivered to the corporation or its authorized collection representative upon demand.

(b)

The corporation shall require retailers to place all lottery proceeds due the corporation

in accounts
in institutions insured by the f
ederal
d
eposit
i
nsurance
c
orporation not later than the close of the next banking day after the date of their collection by the retailer until the date they are paid over to the corporation.

At the time of such deposit, lottery proceeds shall be deemed to be the property of the corporation.

The corporation may require a retailer to establish a single separate electronic funds transfer account where available for the purpose of receiving
monies
from ticket or share sales, making payments to the corporation

and receiving payments for the corporation.

Unless otherwise authorized in writing by the corporation, each lottery retailer shall establish a separate bank account for lottery proceeds which shall be kept separate and apart from

all other funds and assets and shall not be commingled with any other funds or assets.

(c)

Whenever any person who receives proceeds from the sale of lottery tickets or shares

in the capacity of a lottery retailer becomes insolvent or dies insolvent, the proceeds due the corporation from such person or his estate shall have preference over all debts or demands.

21
‑
24
‑
120.

Computation of rental payments of retailers.

If a lottery retailer
'
s rental payments for the business premises are contractually

computed, in whole or in part, on the basis of a percentage of retail sales and such computation of retail sales is not explicitly defined to include sales of tickets or shares in a state operated or state managed lottery, only the compensation received by the lottery retailer from the corporation may be considered the amount of the lottery retail sale for purposes of computing the rental payment.

21
‑
24
‑
121.

Restrictions on sale of tickets or shares; price; gifts and promotions.

(a)

No person shall sell a ticket or share at a price other than established by the corporation unless authorized in writing by the chief executive officer.

No person other than a duly certified lottery retailer shall sell lottery tickets, but this subsection shall not be construed to prevent a person who may lawfully purchase tickets or shares from making a gift of lottery tickets or shares to another.

Nothing in this chapter shall be construed to prohibit the corporation from designating certain of its agents and employees to sell or give lottery tickets or shares directly to the public.

(b)

Lottery tickets or shares may be given by merchants as a means of promoting goods

or services to customers or prospective customers subject to prior approval by the corporation.

(c)

No lottery retailer shall sell a lottery ticket or share except from the locations listed in

his contract and as evidenced by his certificate of authorization unless the corporation authorizes in writing any temporary location not listed in his contract.

(d)

No lottery tickets or shares shall be sold to persons under
eighteen (
18
)
years of age, but this
sub
section does not prohibit the purchase of a lottery ticket or share by a person
eighteen (
18
)
years of age or older for the purpose of making a gift to any person of any age.

In such case, the corporation shall direct payment of proceeds of any lottery prize to an adult member of the person
'
s family or a legal representative of the person on behalf of
the underage
person
.

21
‑
24
‑
122.

Prize proceeds subject to attachments, garnishments or executions; validation of winning tickets; prohibited purchases; money

dispensing machines; unclaimed prize money.

(a)

Except as otherwise provided in this cha
pter, attachments, garnishments
or executions authorized and issued pursuant to law shall be withheld if timely served upon the corporation.

This subsection shall not apply to a retailer.

(b)

The corporation shall adopt regulations, policies and procedures to establish a system

of verifying the validity of tickets or shares claimed to win prizes and to effect payment of such prizes, except that:

(
i
)

No prize, any portion of a prize or any right of any person to a prize awarded shall be

assignable. Any prize or any portion of a prize remaining unpaid at the death of a prize winner shall be paid to the estate of the deceased prize winner or to the trustee of a trust established by the deceased prize winner as settlor if a copy of the trust document or instrument has been filed with the corporation along with a notarized letter of direction from the settlor and no written notice of revocation has been received by the corporation prior to the settlor
'
s death.

Following a settlor
'
s death and prior to any payment to such a successor trustee, the corporation shall obtain from the trustee a written agreement to indemnify and hold the corporation harmless with respect to any claims that may be asserted against the corporation arising from payment to or through the trust.

Notwithstanding any other provisions of this section, any person, pursuant to an

appropriate judicial order, shall be paid the prize to which a winner is entitled;

(
ii
)

No prize shall be paid arising from claimed tickets that are
:

(A)

S
tolen, counterfeit, altered,

fraudulent, unissued, produced or issued in error, unreadable, not received or not recorded by the corporation within applicable deadlines;

(B)

L
acking in captions that conform and agree with the play symbols as appropriate to the particular lottery game involved; or

(
C
)

N
ot in compliance with such additional specific regulations and public or confidential validation and security tests of the corporation appropriate to the p
articular lottery game involved.

(
iii
)

No particular prize in any lottery game shall be paid more than once, and in the event

of a determination that more than one
(1)
claimant is entitled to a particular prize, the sole remedy of such claimants is the award to each of them of an equal share in the prize; and

(
iv
)

A holder of a winning cash ticket or share from a lottery game shall claim a cash prize

within
one hundred eighty

(
180
)
days, or for a multi
-
state or multi
-
sovereign lottery game within
one hundred eighty

(
180
)
days, after the drawing in which the cash prize was won.

In any
Wyoming
lottery game in which the player may determine instantly if he has won or lost, he shall claim a cash prize within
ninety (
90
)
days, or for a multi
-
state lottery game within
one hundred eighty

(
180
)
days, after the end of the lottery game.

If a valid claim is not made for a cash prize within the applicable period, the cash prize shall constitute an unclaimed prize for purposes of this section.

(c)

No prize shall be paid upon a ticket or share purchased or sold in violation of this

chapter.

Any such prize shall constitute an unclaimed prize for purposes of this section.

(d)

The corporation is discharged of all liability upon payment of a prize.

(e)

No ticket or share shall be purchased by and no prize shall be paid to any member of
the board of directors,
any officer
or employee of the corporation
or to any spouse, child,

brother, sister or parent residing as a member of the same household in the principal place of residence of any such person.

No ticket or share shall be purchased by and no prize shall be paid to any officer, employee, agent or subcontractor of any vendor or to any spouse, child, brother, sister or parent residing as a member of the same household in the principal place of residence of any such person if such officer, employee, agent or subcontractor has access to confidential information which may compromise the integrity of the lottery.

(f)

No lottery game utilizing an electronic or mechanical machine may use a machine

which dispenses coins or currency.

(g)

Unclaimed prize money shall not constitute net lottery proceeds.

A portion of

unclaimed prize money, not to exceed
two hundred thousand dollars (
$200,000.00
)
annually, shall be
paid from the corporation
to the
d
epartment of
health

for the treatment of compulsive gambling disorder and educational programs related to such disorder.

In addition, unclaimed prize money may be added to the pool from which future prizes are to be awarded or used for special prize promotions.

21
‑
24
‑
123.

Confidentiality of information; investigations; supervision and inspections; reports of suspected violations; assistance in investigation of violations.

(a)

Except as authorized in this chapter, the corporation is subject to the provisions
of
W.S. 16
‑
4
‑
201 through 16
‑
4
‑
205
.

The corporation is specifically authorized to determine which information relating to the operation of the lottery is confidential.

Such inf
ormation includes trade secrets,
security measures, systems or procedures
,
security reports
,
information concerning bids or other contractual data, the disclosure of which would impair the efforts of the corporation to contract for goods or services on favorable terms
,
employee personnel information unrelated to compensation, duties, qualifications or responsibilities and information obtained pursuant to investigations which is otherwise confidential.

Information deemed confidential pursuant to this
sub
section is exempt from the provisions of
W.S. 16
‑
4
‑
201 through 16
‑
4
‑
205
.

Meetings or portions of meetings devoted to discussing information deemed confidential pursuant to this
sub
section are exempt
from
W.S. 16
‑
4
‑
201 through 16
‑
4
‑
205
.

(b)

The corporation shall perform full criminal background investigations prior to the

execution of any vendor contract.

(c)

The corporation or its authorized agent shall:

(
i
)

Conduct criminal background investigations and credit investigations on all potential

retailers;

(
ii
)

Supervise ticket or share validation and lottery drawings;

(
iii
)

Inspect at times
,
determined solely by the corporation
,
the facilities of any vendor or

lottery retailer in order to determine the integrity of the vendor
'
s product or the operations of the retailer in order to determine whether the vendor or the retailer is in compliance with its contract;

(
iv
)

Report any suspected violations of this chapter to the appropriate district attorney or

the
a
ttorney
g
eneral and to any law enforcement

agencies having jurisdiction over the violation; and

(
v
)

Upon request, provide assistance to any district attorney, the
a
ttorney
general
or a

law enforcement agency investigating a violation of this chapter.

21
‑
24
‑
124.

Sales to minors; penalty; affirmative defense.

Any person who knowingly sells a lottery ticket or share to a person under
eighteen (
18
)
years of

age or permits a person under
eighteen (
18
)
years of age to play any lottery game shall be guilty of a misdemeanor and shall be fined not less than
one hundred dollars (
$100.00
)
nor more than
five hundred dollars (
$500.00
)
for the first offense and for each subsequent offense not less than
two hundred dollars (
$200.00
)
nor more than
one thousand dollars (
$1,000.00
)
.

It shall be an affirmative defense to a charge of a violation under this section that the retailer reasonably and in good faith relied upon representation of proof of age in making the sale.

21
‑
24
‑
125.

Penalty for falsely making, alter
ing, forging, uttering, passing
or counterfeiting ticket; penalty for attempting to influence winning of prize.

(a)

Any person who, with intent to defraud, falsely makes, alters, forges, utters, passes or

counterfeits a state lottery ticket shall be punished by a fine not to exceed
fifty thousand dollars (
$50,000.00
),
imprisonment for not
more
than five
(5)
years
,
or both.

(b)

Any person who influences or attempts to influence the winning of a prize through the

use of coercion, fraud, deception or tampering with lottery equipment or materials shall be punished by a fine not to exceed
fifty thousand dollars (
$50,000.00
),
imprisonment for not
more
than five
(5)
years
,
or both.

21
‑
24
‑
126.

Penalty for making false statements or false entries in books or records.

No person shall knowingly or intentionally make a material false statement in any

application for a license or proposal to conduct lottery activities or make a material false entry in any book or record which is compiled or maintained or submitted to the board pursuant to the provisions of this chapter.

Any person who violates the provisions of this section shall be punished by a fine not to exceed
twenty-five thousand dollars (
$25,000.00
)
or the dollar amount of the false entry or statement, whichever is greater, by imprisonment for not
more
than five
(5)
years
,
or both.

21
‑
24
‑
127.

Agreements with agencies of other jurisdictions; restriction on release of records, documents and information.

(a)

The corporation may enter into intelligence sharing, reciprocal use or restricted use

agreements with the federal government, law enforcement agencies, lottery regulation agencies and gaming enforcement agencies of other jurisdictions which provide for and regulate the use of information provided and received pursuant to the agreement.

(b)

Records, documents and information in the possession of the corporation received

pursuant to an intelligence

sharing, reciprocal use or restricted use agreement entered into by the corporation with a federal department or agency, any law enforcement agency or the lottery regulation or gaming enforcement agency of any jurisdiction shall be considered investigative records of a law enforcement agency and are not subject to
W.S. 16
‑
4
‑
201 through 16
‑
4
‑
205
and shall not be released under any condition without the permission of the person or agency providing the record or information.

21
‑
24
‑
128.

Bidding requirements and procedures for contracts.

(a
)

The corporation shall enter into its contracts for procurements after competitive

bidding. The requirement for competitive bidding does not apply in the case of a single vendor having exclusive rights to offer a particular service or product.

Procedures adopted by the board shall be designed to allow the selection of proposals that provide the greatest long-term benefit to the state, the greatest integrity for the corporation and the best service and products for the public.

(b)

In any bidding process, the corporation may administer its own bidding and

procurement or may utilize the services of the
d
epartment of
a
dministrati
on

and information
or other state agency or subdivision thereof.

21
‑
24
‑
129.

Appeals from actions of board.

(a)

Any retailer, vendor or applicant for a retailer or vendor contract aggrieved by an

action of the board may appeal that decision to the
first judicial district court
.

(b)

The
first judicial district court
shall hear appeals from decisions of the board

and based upon the record of the proceedings before the board may reverse the decision of the board only if the appellant proves the decision to be:

(
i
)

Clearly erroneous;

(
ii
)

Arbitrary and capricious;

(
iii
)

Procured by fraud;

(
iv
)

A result of substantial misconduct by the board; or

(
v
)

Contrary to the
United States

c
onstitution or the
c
onstitution of
Wyoming
or the

provisions of this chapter.

(c)

The
district
court may remand an appeal to the board to conduct further hearings.

(d)

Any person who appeals the award of a
major procurement contract
for the supply of

a lottery ticket system, share system or an on-line or other mechanical or electronic system shall be liable for all costs of appeal and defense in the event the appeal is denied or the contract award upheld.

21
‑
24
‑
130.

Corporation authorized to borrow money; validation of debt; restriction on use of money in state general fund; purchase or release of goods and services.

(a)

The corporation may borrow, or accept and expend, in accordance with the provisions

of this
chapter
, such
monies
as may be received from any source, including income from the corporation
'
s operations, for effectuating its corporate purposes, including the payment of the initial expenses of initiation, administration and operation of the corporation and the lottery.

(b)

The corporation shall be self

sustaining and self

funded.

Monies
in the state general

fund shall not be used or obligated to pay the expenses of the corporation or prizes of the lottery and no claim for the payment of an expense of the lottery or prizes of the lottery may be made against any
monies
other than
monies
credited to the corporation operating account.

(
c
)

The corporation may purchase, lease or lease

purchase such goods or services as are

necessary for effectuating the purposes of this
chapter
.

The corporation may make procurements which integrate functions such as lottery game design, lottery ticket distribution to retailers, supply of goods and services and advertising.

In all procurement decisions, the corporation shall take into account the particularly sensitive nature of the state lottery and shall act to promote and ensure security, honesty, fairness and integrity in the operation and administration of the lottery and the objectives of raising net proceeds for the benefit of educational programs and purposes.

21
‑
24
‑
131.

Reports by corporation; audits; budget; fiscal year.

(a)

To ensure the financial integrity of the lottery, the corporation through its board of

directors shall:

(
i
)

Submit quarterly and annual reports
to the
g
overnor, state auditor and

the joint revenue
interim
committee
disclosing the total lottery revenues, prize disbursements, operating expenses and administrative expenses of the corporation during the reporting period.

The annual report shall additionally describe the organizational structure of the corporation and summarize the functions performed by each organizational division within the corporation;

(
ii
)

Adopt a system of internal audits;

(
iii
)

Maintain weekly or more frequent records of lottery transactions, including the

distribution of tickets or shares to retailers, revenues received, claims for prizes, prizes paid, prizes forfeited and other financial transactions of the corporation;

(
iv
)

Contract with a certified public accountant or firm for an annual financial audit of the

corporation.

The certified public accountant or firm shall have no financial interest in any vendor with whom the corporation is under contract.

The certified public accountant or firm shall present an audit report not later than four
(4)
months after the end of the fiscal year.

The certified public accountant or firm shall evaluate the internal auditing controls in effect during the audit period.

The cost of this annual financial audit shall be an operating expense of the corporation.

The state auditor may at any time conduct an audit of any phase of the operations of the
Wyoming

l
ottery
c
orporation at the expense of the state and shall receive a copy of the annual independent financial audit.

A copy of any audit performed by the certified public accountant or firm or the state audit
or shall be transmitted to the g
overnor, the state auditor
and the joint revenue
interim
committee
;

(
v
)

Submit to the
g
overnor
, the state auditor, and the
joint revenue
interim
committee
by June 30 of each year a copy of the annual operating budget for the

corporation for the next fiscal year.

This annual operating budget shall be approved by the board and be on such forms as prescribed by the
department of administration and information
;

(
vi
)

For informational purposes only, submit to the
g
overnor
on

September 1 of each year a proposed operating budget for the corporation for the succeeding fiscal year.

This budget proposal shall also be accompanied by an estimate of the net proceeds to be deposited into the
l
ottery for
e
ducation
a
ccount dur
ing the succeeding fiscal year
; and

(
vii
)

Adopt the same fiscal year as that used by state government.

ARTICLE 2
SETOFF OF DEBT COLLECTION AGAINST LOTTERY PRIZES

21
‑
24
‑
201
.

Purpose.

The purpose of this
article
is to establish a policy and to provide a system whereby all

claimant agencies of this state in conjunction with the corporation shall cooperate in identifying debtors who owe money to the state through its various claimant agencies or to persons on whose behalf the state and its claimant agencies act and who qualify for prizes under
a
rticle
1 of this chapter from the corporation.

It is also the purpose of this article to establish procedures for setting off against any such prize the sum of any debt owed to the state or to persons on whose behalf the state and its claimant agencies act.

It is the intent of the
l
egislature that this article be liberally construed to effectuate these purposes.

21
‑
24
‑
202
.

Definitions.

(a)

As used in this article:

(
i
)

"
Claimant agency
"
means any state agency, depart
ment, board, bureau, commission
or authority to which an individual owes a debt or which acts on behalf of an individual to collect

a d
ebt;

(
ii
)

"
Debt
"
means any liquidated sum due and owing any claimant agency, which sum has

accrued through contract, subrogation, tort or operation of law regardless of whether there is an outstanding judgment for the sum, or any sum which is due and owing any person and is enforceable by the state or any
of its agencies or departments;

(
iii
)

"
Debtor
"
means any individual owing money to or having a delinquent account with

any claimant agency, which obligation has not been adjudicated as satisfied by court order, set aside by court order
or discharged in bankruptcy;

(
iv
)

"
Prize
"
means the proceeds of any lottery prize awarded under
a
rticle
1 of this

chapter.

21
‑
24
‑
20
3
.

Collection remedy in addition to other remedies.

The collection remedy authorized by this
article
is in addition to and not in substitution

for any other remedy available by law.

21
‑
24
‑
20
4
.

Debts owed to state agencies
;
lien against lottery winnings; prizes paid out

by retailers or noncorporate entities; time period involved; rules and regulations;

immunity; costs.

(a)

Any claimant agency may submit to the corporation a list of the names of all persons

owing debts in excess of
one hundred dollars (
$100.00
)
to
the
claimant agency or to persons on whose behalf the claimant agency is acting.

The full amount of the debt shall be collectable from any lottery winnings without regard to limitations on the amounts that may be collectable in increments through garnishment or other proceedings.
The
list shall constitute a valid lien upon and claim of lien against the lottery winnings of any debtor named in
the
list.

The list shall contain the names of the debtors, their social security numbers if available and any other information which would assist the corporation in identifying the debtors named in the list.

(b)

The corporation is authorized and directed to withhold any winnings subject to the

lien created by this section and send notice to the winner by certified mail or statutory overnight delivery, return receipt requested, of
the
action and the reason the winnings were withheld.

However, if the winner appears and claims winnings in person, the corporation shall notify the winner at that time by hand delivery of
the
action.

If the debtor does not protest the withholding of
the
funds in writing within
thirty (
30
)
days of
the
notice, the corporation shall pay the funds over to the claimant agency.

If the debtor protests the withholding of
the
funds within
thirty (
30
)
days of
the
notice, the corporation shall file an action in interpleader in the
district
court of the county in which the debtor resides, pay the disputed sum into the court and give notice to the claimant agency and debtor of the initiation of such action.

(c)

The liens created by this section shall rank among themselves as follows:

(
i
)

Taxes due the state;

(
ii
)

Delinquent child support; and

(
iii
)

All other judgments and liens in order of the date entered or perfected.

(d)

The corporation shall not be required to deduct claimed debts from prizes paid out by

retailers or entities other than the corporation.

(e)

Any list of debt provided pursuant to this
article
shall be provided periodically as the corporation shall provide by rules and regulations and the corporation shall not be obligated to retain
the
lists or deduct debts appearing on
the
lists beyond the period

determined by such rules and regulations.

(f)

The corporation is authorized to prescribe forms and promulgate rules and regulations

which it deems necessary to carry out the provisions of this
article
.

(g)

The corporation and any claimant agency shall incur no civil or criminal liability for

good faith adherence to the provisions of this section.

(h)

The claimant agency shall pay the corporation for all costs incurred by the corporation in setting off debts in the manner provided in this
article
.

21
‑
24
‑
20
5
.

Information provided to claimant agency; confidentiality.

(a)

Notwithstanding
W.S.
21
‑
24
‑
123
, which prohibits disclosure by the

corporation of the contents of prize winner records or information and notwithstanding any other confidentiality statute, the corporation may provide to a claimant agency all information necessary to accomplish and effectuate the intent of this
article
.

(b)

The information obtained by a claimant agency from the corporation in accordance

with this article shall retain its confidentiality and shall only be used by a claimant agency in the pursuit of its debt collection duties and practices.

Any employee or prior employee of any claimant agency who unlawfully discloses any such information for any other purpose, except as otherwise specifically authorized by law, shall be subject to the same penalties specified by law for unauthorized disclosure of confidential information by an agent or employee of the corporation.

21
‑
24
‑
20
6
.

Article applicable to prizes of $5,000.00 or more.

The provisions of this article shall only apply to prizes of
five thousand dollars (
$5,000.00
)
or more and shall not

apply to any retailers authorized by the board to pay prizes of up to
five thousand dollars (
$5,000.00
)
after deducting t
he price of the ticket or share,
excepting that a claim for delinquent child support filed by the
department of family services
shall apply to all prizes of
two thousand five hundred dollars (
$2,500.00
)
,
or more.

Section 2.

W.S. 6
‑
7
‑
101(a)(iii) by creating a new subparagraph (
J
)
,
7
‑
19
‑
201(a) by creating a new paragraph (xiii)
, 39
‑
15
‑
105(a)(viii) by creating a new subparagraph (S) and 39
‑
16
‑
105(a)(viii) by creating a new subparagraph (H)
are
amended to read:

6
‑
7
‑
101.

Definitions.

(a)

As used in this article:

(iii)

"
Gambling
"
means risking any property for gain contingent in whole or in part upon lot, chance, the operation of a gambling device or the happening or outcome of an event, including a sporting event, over which the person taking a risk has no control, but does not include:

(
J
)

Any lottery game authorized and run by the
Wyoming
lottery corporation pursuant to W.S. 21
‑
24
‑
101 through 21
‑
24
‑
131.

7
‑
19
‑
201.

State or national criminal history record information.

(a)

The following persons shall be required to submit to fingerprinting in order to obtain state and national criminal history record information:

(xiii)

Persons
required to receive a background investigation as provided in W.S. 21
‑
24
‑
101 through 21
‑
24
‑
131.

39
‑
15
‑
105.

Exemptions.

(a)

The following sales or leases are exempt from the excise tax imposed by this article:

(viii)

For the purpose of exempting sales of services and tangible personal property as an economic incentive, the following are exempt:

(S)

Sales of and retail commissions on lottery tickets or shares and equipment necessary to operate a lottery under W.S. 21
‑
24
‑
101 through 21
‑
24
‑
131.

39
‑
16
‑
105.

Exemptions.

(a)

The following purchases or leases are exempt from the excise tax imposed by this article:

(viii)

For the purpose of exempting sales of services and tangible personal property as an economic incentive, the following are exempt:

(H)

Purchase of and retail commissions on lottery tickets or shares and equipment necessary to operate a lottery under W.S. 21
‑
24
‑
101 through 21
‑
24
‑
131.

Section
3
.

This act is effective July 1, 2009.

(END)

1
HB0170