OK
Oklahoma House Bill HB1800

Oklahoma 2023 Regular Session

Oklahoma House Bill HB1800 Compare Versions

Only one version of the bill is available at this time.
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2828 STATE OF OKLAHOMA
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3030 1st Session of the 59th L egislature (2023)
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3232 HOUSE BILL 1800 By: Osburn
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3838 AS INTRODUCED
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4040 An Act relating to amusements and sports; amending 3A
4141 O.S. 2021, Sections 712, 717, 724, and 733, which
4242 relate to the Oklahoma Education Lottery Act;
4343 modifying when background checks shall be conducted;
4444 modifying requirement to display certificate of
4545 authority; modifying when the Oklahoma Lottery
4646 Commission submits report ; modifying who copy of
4747 audit shall be transmitted to; providing that the
4848 Commission submit estimate by certain date; modifying
4949 documents that must be provided if receiving payment
5050 of a certain amount; repealing 3A O.S. 2021, Sections
5151 706, 713, as amended by Section 1, Chapter 359,
5252 O.S.L. 2022 (3A O.S. Supp. 2022, Section 713), and
5353 734, which relate to the Oklahoma Educati on Lottery
5454 Act; and providing an effective date .
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6363 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
6464 SECTION 1. AMENDATORY 3A O.S. 2021, Section 712, is
6565 amended to read as follows:
6666 Section 712. A. The executive director of the Oklahoma Lottery
6767 Commission, with the approval of the board of trustees, shall employ
6868 such personnel as may be nec essary to carry out the provi sions of
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9595 this act and shall set the compen sation and terms of compensation of
9696 such employees. All offices, positions, and personnel of the
9797 Oklahoma Lottery Commission shall be in the unclassified service.
9898 B. No employee of th e Commission shall have a financial
9999 interest in any vendor doing busine ss or proposing to do business
100100 with the Commission.
101101 C. No employee of the Commission shall participate in any
102102 decision involving a retailer with whom the employee has a financial
103103 interest.
104104 D. No employee of the Commission who leaves the employment of
105105 the Commission may represent any vendor or lottery retailer before
106106 the Commission for a period of two (2) years following termination
107107 of employment with the Commission.
108108 E. A background investigation shall be conducte d on each
109109 applicant who has reached the fi nal selection process prior to
110110 employment by the Commission at the level of division director and
111111 above and at any level within any divi sion of security and as
112112 otherwise required by the board of trustees of the Oklahoma Lottery
113113 Commission. The Commission shall pay for the actual cost of the
114114 investigations and shall contract with the Oklahoma State Bureau of
115115 Investigation for the performan ce of the investigations and on every
116116 active employee of the Commission on an annual basis. The results
117117 of a background investigation shall not be considered a record open
118118 to the public pursuant to the Oklahoma Open Records Act.
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145145 F. No person who has been convicted of any felony or a
146146 misdemeanor involving illegal gambli ng or involving moral turpitude
147147 shall be employed by t he Commission, nor shall the Commission employ
148148 a person who is awaiting sentencing on a plea of guilt or nolo
149149 contendere to such a felony or misdemeanor .
150150 G. The Commission shall bond Commission employees with access
151151 to Commission funds or lottery revenue in an amount specified by the
152152 board and may bond other employees as deemed necessary.
153153 SECTION 2. AMENDATORY 3A O.S. 2021, Section 717, is
154154 amended to read as follows:
155155 Section 717. A. The people of this state recognize that to
156156 conduct a successful lottery, the Oklahoma Lottery Commission must
157157 develop and maintain a statewide network of lottery retailers that
158158 will serve the public convenience and promote the sale of tickets or
159159 shares and the playing of lottery games while ensuring t he integrity
160160 of the lottery operations, games, and activities.
161161 B. The Commission shall make every effort t o provide small
162162 retailers a chance to participate in the sales of lottery tickets or
163163 shares.
164164 C. The Commission shall provide for compensation to lot tery
165165 retailers in the form of commissions in an amount of not less than
166166 two percent (2%) of gross sales and may provide for other forms of
167167 compensation for services rendered in the sale or cashing of lottery
168168 tickets or shares.
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195195 D. The Commission shall issue a certificate of authority to
196196 each person with whom it contracts as a retailer for purposes of
197197 display for each location at which tickets or shares are offered for
198198 sale. Every lottery retailer shall post and keep conspicuously
199199 displayed in a location on the premises accessible to the public its
200200 certificate of authority. No certificate of authority shall be
201201 assignable or transferable.
202202 E. The board of trustees of the Oklahoma Lottery Commission
203203 shall develop a list of objective criteria upon which the
204204 qualification of lottery retailers shall be based. Separate
205205 criteria shall be developed to govern the select ion of retailers of
206206 instant tickets. In developing these criteria, the board shall
207207 consider such factors as the financial responsibility of the
208208 applicant, security of the place of business or activity of the
209209 applicant, accessibility to the public, integri ty, and reputation.
210210 The board shall not consider political affiliation, activities, or
211211 contributions to political committees or candidates for any p ublic
212212 office. The criteria shall include, but not be limited to, the
213213 following:
214214 1. The applicant shall be current in filing all applicable tax
215215 returns to the State of Oklahoma and in payment of all taxes,
216216 interest, and penalties owed to the State of Okla homa, excluding
217217 items under formal appeal pursuant to applicable statutes. An
218218 applicant who has entered in to and is abiding by a payment agreement
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245245 with the Oklahoma Tax Commission shall be deemed current in payment
246246 of such taxes, penalties and interest. Notwithstanding the
247247 provisions of Section 205 of Title 68 of the Oklahoma Statutes, the
248248 Oklahoma Tax Commission shall provide this information to the
249249 Commission;
250250 2. No person, partnership, unincorporated association,
251251 corporation, or other business entity or principal, officer or
252252 director of a corporation or other business entity shall be selected
253253 as a lottery retailer who:
254254 a. has been convicted of or is awaiting sentencing on a
255255 plea of guilt or nolo contendere to a criminal offense
256256 related to the security or integrity of the lottery in
257257 this or any other jurisdiction,
258258 b. has been convicted of or is awaiting sent encing on a
259259 plea of guilt or nolo contendere to any illegal
260260 gambling activity, false statements, false swearing,
261261 or perjury in this or any other juri sdiction or
262262 convicted of or is awaiting sentencing on a plea of
263263 guilt or nolo contendere to any crime punis hable by
264264 more than one (1) year of imprisonment or a fine of
265265 more than One Thousand Dollars ($1,000.00) or both,
266266 unless the civil rights of the perso n have been
267267 restored and at least five (5) years have elapsed from
268268 the date of the completion of the senten ce without a
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295295 subsequent conviction of a crime described in this
296296 subparagraph,
297297 c. has been found to have violated the provisions of the
298298 Oklahoma Education Lottery Act or any rule, policy, or
299299 procedure of the Commission unless either ten (10)
300300 years have passed since the violation or the board
301301 finds the violation both minor and unintentional in
302302 nature,
303303 d. is a vendor or any employee or agent of any vendor
304304 doing business with the Commission,
305305 e. resides in the same household as the executive
306306 director, any board member, or any employee of the
307307 Commission,
308308 f. has made a statement of material fact to the
309309 Commission knowing such statement to be false, or
310310 g. is engaged exclusively in the business of selling
311311 lottery tickets or shares. This subparagraph shall
312312 not preclude the Commission from selling or giving
313313 away lottery tickets or shares for promotional
314314 purposes;
315315 3. Persons applying to become lottery retailers sh all be
316316 charged a uniform application fee for each lottery outlet;
317317 4. Any lottery retailer contract execute d pursuant to this
318318 section may, for good cause, be suspended, revoked, or terminated by
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345345 the executive director or designee if the retailer is found t o have
346346 violated any provisions of the Oklahoma Education Lottery Act or
347347 objective criteria established by t he board. Review of such
348348 activities shall be in accordance with the procedures outlined in
349349 the Oklahoma Education Lottery Act and shall not be subje ct to the
350350 Administrative Procedures Act; and
351351 5. All lottery retailer contracts may be renewable annually i n
352352 the discretion of the Commission unless sooner canceled or
353353 terminated.
354354 F. No certificate of authority to act as a lottery retailer
355355 shall be issued to any applicant doing business or who holds a
356356 license to do business as a pawnbroker, supervised lender, or
357357 deferred deposit lender, also known as a payday lender, or whose
358358 primary business is categorized as a check casher.
359359 G. No lottery retailer or app licant to be a lottery retailer
360360 shall pay, give, or make any economic opportunity, gift, loan,
361361 gratuity, special discount, favor, hospitality, or service, to the
362362 executive director, any board member, or any employee of the
363363 Commission, or to any person rela ted to any such person within the
364364 third degree of consanguinity or affinity.
365365 SECTION 3. AMENDATORY 3A O.S. 2021, Section 724, is
366366 amended to read as follows:
367367 Section 724. A. Proceeds of any lottery prize shall be subject
368368 to the Oklahoma state income tax.
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395395 B. Attachments, garnishments, or executions authorized and
396396 issued pursuant to law shall be withheld if timely served upon the
397397 Oklahoma Lottery Commission. This subsection shall not apply to
398398 payment of prizes by a retailer.
399399 C. The Commission shall adopt policies and procedures to
400400 establish a system of verifying the validity of tick ets or shares
401401 claimed to win prizes and to effect payment of the prizes, except
402402 that:
403403 1. No prize, any portion of a prize, or any right of any person
404404 to a prize awarded shall be assignable. Any prize or any portion of
405405 a prize remaining unpaid at the deat h of a prize winner shall be
406406 paid to the estate of the deceased prize winner or to the trustee of
407407 a trust established by the deceased prize winner as s ettlor if a
408408 copy of the trust document or instrument has been filed with the
409409 Commission along with a nota rized letter of direction from the
410410 settlor and no written notice of revocation has been received by the
411411 Commission prior to the death of the settlor. Following the death
412412 of a settlor and prior to any payment to a successor trustee, the
413413 Commission shall obtain from the trustee a written agreement to
414414 indemnify and hold the Commission harmless with respect to any
415415 claims that may be asserted against the Com mission arising from
416416 payment to or through the trust. Notwithstanding any other
417417 provisions of this secti on, any person, pursuant to an appropriate
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444444 judicial order, shall be paid the prize to which a winner is
445445 entitled;
446446 2. No prize shall be paid arising fr om claimed tickets that
447447 are:
448448 a. stolen, counterfeit, altered, fraudulent, unissued,
449449 produced or issued in error, unreadable, not received,
450450 or not recorded by the Commission within applicable
451451 deadlines,
452452 b. lacking in captions that conform and agree with the
453453 play symbols as appropriate to the particular lottery
454454 game involved, or
455455 c. not in compliance with such a dditional public or
456456 confidential validation and security tests of the
457457 Commission appropriate to the particular lottery game
458458 involved;
459459 3. No particular prize in any lottery game shall be paid more
460460 than once, and in the event of a determination that more th an one
461461 claimant is entitled to a particular prize, the sole remedy of the
462462 claimants is the award to each of them of an equal share in the
463463 prize;
464464 4. A holder of a winning cash ticket or share from a lottery
465465 game shall claim a cash prize within one hundred eighty (180) days,
466466 or for a multistate or multisovereign lottery game within one
467467 hundred eighty (180) days, after the drawing in which the cash prize
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494494 was won. In any Oklahoma lottery game in which the player may
495495 determine instantly if the player has won o r lost, the player shall
496496 claim a cash prize within ninety (90) days, or for a multistate
497497 lottery game within one hundred eighty (180) days, after the e nd of
498498 the lottery game. If a valid claim is not made for a cash prize
499499 within the applicable period, the cash prize shall constitute an
500500 unclaimed prize for purposes of the Oklahoma Education Lottery Act;
501501 5. Any person or persons claiming a lottery prize e xceeding Six
502502 Hundred Dollars ($600.00) shall provide the Commission with their
503503 name, address, social secu rity number, and sufficient valid
504504 identification as proof of the same prior to payment of the prize by
505505 the Commission; and
506506 6. Any person or persons cl aiming a lottery prize exceeding
507507 Five Thousand Dollars ($5,000.00) shall provide the Commission with
508508 their name, address, social security number, and sufficient valid
509509 identification and proof of social security number prior to payment
510510 of the prize by the C ommission; and
511511 7. Any person or persons claiming a lottery prize exceeding Six
512512 Hundred Dollars ($600.00) as a trust shall provide for each person
513513 entitled to any portion of the prize their name, address, social
514514 security number, and sufficient valid identi fication as proof of the
515515 same and proof of social security number prior to payment of the
516516 prize by the Commission except that such information specified in
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543543 this paragraph shall be conf idential and not subject to the
544544 provisions of the Oklahoma Open Records Act.
545545 D. No prize shall be paid upon a ticket or share purchased or
546546 sold in violation of the Oklahoma Education Lottery Act. Any such
547547 prize shall constitute an unclaimed prize for pur poses of the
548548 Oklahoma Education Lottery Act.
549549 E. The Commission is disch arged of all liability upon payment
550550 of a prize.
551551 F. No ticket or share shall be purchased by and no prize shall
552552 be paid to any member of the board of trustees of the Oklahoma
553553 Lottery Commission, any officer or employee of the Commission, or to
554554 any spouse, child, brother, sister, or parent residing as a member
555555 of the same household in the principal place of residence of any
556556 such person. No ticket or share shall be purchased by and no pr ize
557557 shall be paid to any officer, employee, agent, or subcontractor of
558558 any vendor or to any spouse, child, brother, sister, or parent
559559 residing as a member of the same household in the principal place of
560560 residence of any such person if the officer, employee , agent, or
561561 subcontractor has access to confidential information which m ay
562562 compromise the integrity of the lottery.
563563 G. Unclaimed prize money shall not constitute net lottery
564564 proceeds. The first Seven Hundred Fifty Thousand Dollars
565565 ($750,000.00) of unclai med prize money accruing annually shall be
566566 transferred to the Department of Mental Health and Substance Abuse
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593593 Services for the treatment of compulsive gambling disorder and
594594 educational programs related to such disorder. All other unclaimed
595595 prize money shall be added to the pool from which future prizes are
596596 to be awarded or used for special prize promotions.
597597 SECTION 4. AMENDATORY 3A O.S. 2021, Section 733, is
598598 amended to read as follows:
599599 Section 733. To ensure the financial integrity of t he lottery,
600600 the Oklahoma Lottery Commission through its board of trustees shall:
601601 1. Submit quarterly and an annual reports report to the
602602 Governor, State Auditor and Inspector, Oklahoma State Bureau of
603603 Investigation, and Attorney General, and the oversight commit tee
604604 created by Section 734 of this title, disclosing the total lottery
605605 revenues, prize disbursements, operating expenses, and
606606 administrative expen ses of the Commission during the reporting
607607 period. The annual report shall additionally describe the
608608 organizational structure of the Commission and summarize the
609609 functions performed by each org anizational division within the
610610 Commission;
611611 2. Adopt a system of internal audits;
612612 3. Maintain weekly or more frequent records of lottery
613613 transactions, including the distr ibution of tickets or shares to
614614 retailers, revenues receiv ed, claims for prizes, pri zes paid,
615615 prizes forfeited, and other financial transactions of the
616616 Commission;
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643643 4. Contract with a certified public accountant or firm for an
644644 annual financial audit of th e Commission. The certified public
645645 accountant or firm sha ll have no financial inter est in any vendor
646646 with whom the Commission is under contract. The certified public
647647 accountant or firm shall present an audit report not later than
648648 seven (7) months after t he end of the fiscal year. The certified
649649 public accountant or firm shall evaluate t he internal auditing
650650 controls in effect during the audit perio d. The cost of this annual
651651 financial audit shall be an operating expense of the Commission.
652652 The State Auditor and Inspector may at any time conduct an audit of
653653 any phase of the operations of the Commission at the expense of the
654654 Commission and shall recei ve a copy of the annual independent
655655 financial audit. A copy of any audit performed by the certified
656656 public accountant or firm or the State Auditor and Inspector shall
657657 be transmitted to the Gove rnor, the President Pro Tempore of the
658658 Senate, and the Speaker of the House of Representatives, and the
659659 State Auditor and Inspector , and the cochairs of the oversight
660660 committee created in Section 734 of this title ;
661661 5. Submit to the Office of Management an d Enterprise Services
662662 and the State Auditor and Inspector by June 30 of each year a copy
663663 of the annual operating budget for the Commission for the next
664664 fiscal year. This a nnual operating budget shall be approved by the
665665 board and be on such forms as prescr ibed by the Office of Management
666666 and Enterprise Services; and
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693693 6. For informational purposes only, submit Submit to the Office
694694 of Management and Enterprise Services on September 1 by October 1 of
695695 each year a proposed operating budget for the Commission for the
696696 succeeding fiscal year. The budget proposal shall also be
697697 accompanied by an estimate of the net proceeds to be deposited into
698698 the Oklahoma Education Lottery Trust Fun d during the succeeding
699699 fiscal year. The budget estimate shall be on such forms as
700700 prescribed by the Office of Management and Enterprise Services .
701701 SECTION 5. REPEALER 3A O.S. 2021, Section 706, is hereby
702702 repealed.
703703 SECTION 6. REPEALER 3A O.S. 2021, Section 713, as
704704 amended by Section 1, Chapter 359, O.S.L. 2022 (3A O.S. Supp. 2022,
705705 Section 713), is hereby repealed.
706706 SECTION 7. REPEALER 3A O.S. 2021, Section 734, is hereby
707707 repealed.
708708 SECTION 8. This act shall become effective November 1, 2023.
709709
710710 59-1-5596 CMA 01/10/23