WSR 00-05-101

PROPOSED RULES

GAMBLING COMMISSION


[ Filed February 16, 2000, 10:19 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 99-21-043 with a published date of November 3, 1999.

Title of Rule: Enhanced card room rules.

Purpose: To implement legislation that passed in 1996 and 1997 enabling card rooms to offer the following: Increased number of tables, alternative collection of fees, jackpot schemes and house banked card games. These rules set forth the regulatory and licensing requirements for card rooms to offer these activities.

Statutory Authority for Adoption: RCW 9.46.070.

Summary: See Purpose above.

Name of Agency Personnel Responsible for Drafting: Susan Arland, Lacey, (360) 438-7654 ext. 374; Implementation: Ben Bishop, Lacey, (360) 438-7640; and Enforcement: Sherri Winslow, Lacey, (360) 438-7654 ext. 301.

Name of Proponent: Staff, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: See Purpose above.

Proposal Changes the Following Existing Rules: See Purpose above.

No small business economic impact statement has been prepared under chapter 19.85 RCW. Proposal is exempt under RCW 19.85.025(2); therefore, a small business economic impact statement is not required.

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. This agency does not choose to make section 201, chapter 403, Laws of 1995, apply to this rule adoption.

Hearing Location: Pasco Doubletree Hotel, 252 [2525] North 20th Avenue, Pasco, WA 98301, (509) 547-0701, on April 14, 2000, at 1:30 p.m.

Assistance for Persons with Disabilities: Contact Shirley Corbett by April 3, 2000, TDD (360) 438-7638, or (360) 438-7654 ext. 302.

Submit Written Comments to: Susan Arland, Mailstop 42400, Olympia, WA 98504-2400, fax (360) 438-8652, by April 3, 2000.

Date of Intended Adoption: April 14, 2000.

February 15, 2000

Susan Arland

Rules Coordinator

OTS-3810.2


AMENDATORY SECTION(Amending Order 373, filed 6/15/99, effective 8/1/99)

WAC 230-40-010
Social card games -- Rules of play -- Types of card games authorized.

Social card games shall be played using rules and procedures as set forth in this section. Only card games that have been specifically authorized are allowed to be played in public or social card rooms ((licensed by the commission)). ((The commission hereby authorizes the following card games:))

(1) Social card games shall be played in the following manner:

(a) The game must be played with one or more standard decks of playing cards: Provided, That cards may be removed to comply with rules of a specific game, such as pinochle;

(b) Players shall compete against all other players on an equal basis for nonhouse-banked games or against the licensee for house-banked games;

(c) Each player shall receive their own hand of cards and be responsible for decisions regarding such hand, such as whether to fold, discard, draw additional cards, or raise the wager;

(d) Players shall not place wagers on any other player's or the house's hand and no side bets between players are allowed: Provided, That the following shall not be in violation of this section:

(i) An insurance bet placed in the game of blackjack;

(ii) A tip wager made on behalf of a dealer; or

(iii) "Envy" provisions which allow a player to receive a prize if another player wins a jackpot or odds wager;

(e) A player's win or loss shall be determined during the course of play of a single card game;

(f) No more than two separate games shall be played with a single hand of cards. For purposes of this section, bonus features and progressive jackpots are considered a game; and

(g) The rules of play for each specific game played at a licensed card room shall be maintained on the licensed premises and immediately available for review by commission staff, local law enforcement, or a player upon request. Commission staff shall approve any modification to such rules prior to implementation. In addition, any rules related to wager or prize pay out restrictions shall be clearly posted in the immediate area of such games.

(2) Nonhouse-banked card games shall only be played in the manner set forth in The New Complete Hoyle, Revised, Hoyle's Modern Encyclopedia of Card Games, or a similar authoritative book on card games approved by the director: Provided, That each licensee may make immaterial modifications to each authorized game set out in Hoyle. The following nonhouse-banked card games are authorized:

(a) Poker(( - Any poker game described in Hoyle's Modern Encyclopedia of Card Games, by Walter B. Gibson, published by Doubleday and Company, Inc., April 1974, 1st edition, pages 219 through 277.));

(((2))) (b) Hearts((.));

(((3))) (c) Pinochle((.));

(((4))) (d) Cribbage((.));

(((5))) (e) Rummy((.));

(((6) Pan.

(7))) (f) Panguingue (Pan);

(g) Pitch((.));

(((8) Washington blackjack - as set forth in WAC 230-40-125.

(9) Pan-9.

(10))) (h) Bid Whist((.));

(((11) Those games the director approves on a temporary, case-by-case basis.      An application)) (i) Other games or modifications to approved games may be approved by the director, or the director's designee, on a case-by-case basis. Requests for approval of a game must be submitted in writing, and include the rules of play and all wagering schemes. ((Temporary approvals granted are valid for no more than six months or until adopted by the commission, whichever occurs first.))

(3) House-banked card games shall be approved by the director, or the director's designee, on a case-by-case basis. Request for approval of a house-banked card game must be submitted in writing, including the rules of play and all wagering schemes. A list of all approved games, modifications to games, and rules of play shall be available at all commission offices. The director may approve games in which the determination of whether a player wins or loses depends upon one or more of the following:

(a) The player's hand is a specific:

(i) Pattern or ranking of cards (pair, straight, flush, royal flush, etc.);

(ii) Combination of cards (two queens of hearts, ace and jack of spades, three sevens, etc.); or

(iii) Value of the cards (seventeen, twenty-one, etc.); and/or

(b) The player has a higher ranking or value hand than the house/dealer/banker.

(4) Once a game is approved for play, the director shall not remove it from the authorized list of games without providing licensees written notice. Licensees shall be afforded an opportunity to object to the director's decision. If an objection is filed, an administrative law judge shall review the director's decision utilizing the brief adjudicative procedures set forth in WAC 230-50-010.

(5) The licensee shall be notified in writing when the director denies a request for a new game or modification of a game. The notification shall include reasons for the denial and provide the petitioner all information necessary for a formal petition to the commission for rule making, amendments, or repeal, as set forth in WAC 230-50-800.

[Statutory Authority: RCW 9.46.070.      99-13-103 (Order 373), § 230-40-010, filed 6/15/99, effective 8/1/99.      Statutory Authority: RCW 9.46.0281, 9.46.070 (1), (2), (14) and (20).      96-11-073, § 230-40-010, filed 5/13/96, effective 7/1/96.      Statutory Authority: RCW 9.46.070.      94-13-098 (Order 252), § 230-40-010, filed 6/15/94, effective 7/16/94.      Statutory Authority: RCW 34.05.220(4), [34.05].230 and 9.46.070 (11) and (14).      90-05-032 (Order 205), § 230-40-010, filed 2/14/90, effective 3/17/90.      Statutory Authority: RCW 9.46.070.      88-19-038 (Order 183), § 230-40-010, filed 9/13/88.      Statutory Authority: Chapter 9.46 RCW.      86-19-056 (Order 161), § 230-40-010, filed 9/15/86.      Statutory Authority: RCW 9.46.070(11).      82-23-050 (Order 125), § 230-40-010, filed 11/15/82.      Statutory Authority: RCW 9.46.070(10) (see RCW 9.46.020(20)).      80-09-067 (Order 103), § 230-40-010, filed 7/17/80; Order 78, § 230-40-010, filed 11/17/77; Order 67, § 230-40-010, filed 3/11/77; Order 40, § 230-40-010, filed 6/26/75; Order 23, § 230-40-010, filed 9/23/74.]

OTS-3684.1


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 230-40-015 Rules by which the authorized card games shall be played.

OTS-2826.1


REPEALER

     The following sections of the Washington Administrative Code are repealed:
WAC 230-40-060 Persons shall not share in winnings or charge additional fee for playing cards.
WAC 230-40-150 Side bets prohibited.
WAC 230-40-160 Wagers by other than participants prohibited.
WAC 230-40-900 Public card room enhancement program -- Pilot study.

OTS-2901.2


AMENDATORY SECTION(Amending Order 184, filed 10/24/88)

WAC 230-40-030
Number of tables and players limited.

(((1))) No licensee ((to allow a public card room on its premises)) shall allow more than ((five)) fifteen separate tables at which card games are played((, nor)). No licensee shall allow more than ten players for nonhouse-banked card games and seven players and/or spots for wagering at house-banked card games to participate at any one table at any given time.      ((Provided: When poker is played, additional players are authorized to participate at the card table(s) as follows;

(a)Class E-12 players

(b)Class E-2 thru E-5

and Class D4 players

Provided further, that no table shall have more then twelve players.

(2) No licensee to allow a social card room on its premises shall allow more than ten players to participate at any one table at any given time.      Provided, when poker is played, they may have two tables with 12 players at each table.

(3) The commission may permit a licensee to exceed the player limits on specific occasions for good cause shown.      Requests to exceed the limit shall be submitted to the commission in writing not less than 30 days preceding the date upon which the licensee wishes to exceed the limit.      The request shall indicate the date(s) involved, the reasons why the request is made, and the number of games and players in the games which the licensee desires to allow on that occasion)) Each table shall be permanently numbered and readily identifiable by the licensee's surveillance system.

[Statutory Authority: RCW 9.46.0281 and 9.46.070 (11), (12) and (14).      88-22-019 (Order 184), § 230-40-030, filed 10/24/88.      Statutory Authority: RCW 9.46.010 and 9.46.070 (8) and (14).      85-03-025 (Order 143), § 230-40-030, filed 1/9/85; Order 23, § 230-40-030, filed 9/23/74.]

OTS-3725.1


NEW SECTION
WAC 230-40-040
Fees for house-banked card games -- Prohibited -- Exception.

No person shall be charged a fee, directly or indirectly, to participate in house-banked card games: Provided, That a licensee may collect a commission of not more than five percent from a winning hand of pai gow poker.

[]

OTS-2902.5


AMENDATORY SECTION(Amending Order 300, filed 9/18/96, effective 10/19/96)

WAC 230-40-050
Fees for nonhouse-banked card playing -- Method of assessment and collection -- Maximum fees.

((Except as provided in WAC 230-40-055 for card tournaments, no time based or per hand fee shall be charged a person, directly or indirectly, to play in a card game except as set forth in this section.      Each type of fee shall be maintained and recorded separately from all other fees as set forth in WAC 230-08-090, and be available for audit by the commission and local law enforcement and taxing authorities.

(1) For all card games, the following procedures apply to collection of such fees:

(a) Fees shall be collected in advance by the licensee in cash, or in wagering chips, directly from the player;

(b))) No person shall be charged a fee, directly or indirectly, to play in a nonhouse-banked card game in excess of those fees set forth in this section. Each type of fee shall be maintained and recorded separately from all other fees and be available for audit by commission staff, local law enforcement, and taxing authorities.

(1) The following are authorized methods of assessing fees for playing social card games. Only one method of assessing fees may be used at a table at any given time:

(a) Fees based on a period of time - A specific fee of not more than ten dollars per hour, per player, may be charged to play social card games: Provided, That a licensee may collect the hourly fee in thirty-minute increments;

(b) Fees for each hand played - A specific fee of not more than one dollar per hand, per player, may be charged to play social card games;

(c) Fees based on the amounts wagered during a hand (rake) - A portion of the total amount wagered by a player, not to exceed five dollars per hand or ten percent of total wagers for a hand, whichever is less, may be collected for playing social card games; or

(d) Fees to enter tournaments shall be as set forth in WAC 230-40-055.

(2) Fees shall be collected by a licensed card room employee in the following manner:

(a) Fees assessed on a period of time shall be collected directly from each player by the dealer or floor supervisor responsible for that particular section of the card room. The "direct collection," "chip rack," or "drop box" methods set forth in this section may be used for collection of fees assessed on a period of time;

(b) Fees assessed on a per-hand basis shall be placed in a designated area of the table by the player and collected by the dealer before the first round of cards has been dealt. After collection, the dealer shall deposit all chips or coins in the chip rack or drop box, as applicable;

(c) Fees assessed on the amounts wagered during a game shall be collected by the dealer during play of the hand and placed in a designated area of the table. Once the maximum fee for a hand is accumulated, the dealer shall spread the chips or coins to allow players and the surveillance system the ability to verify the amount collected. After verification, chips shall be deposited in the dealer's chip rack or drop box, as applicable;

(d) All fees to enter tournaments shall be collected in advance of the start of play in accordance with WAC 230-40-055; or

(e) Licensees may apply to the director for approval of alternate fee collection methods. If approved, the method of collection shall be set forth in the letter granting approval.

(3) All fees collected from players shall be maintained and recorded as set forth in WAC 230-08-090. All collections shall be kept separate from all other chips and cash in the card room until recorded in the daily card room records and deposited in the cashier's cage. All chips and cash in the cashier's cage shall be kept separate from all other chips and cash located on the licensed premises at all times card games are conducted. The following methods may be used for control of fees collected for card games:

(a) Direct collection method - Fees are collected directly from each player by a licensed card room employee responsible for that particular section of the card room and deposited in the card room cage serving the area of the card room from which collections are made. Collections shall be made at least once per hour, at times designated by the licensee. All fees shall be recorded immediately upon collection, per WAC 230-08-090. This collection method may only be used when assessing fees based on a period of time.

(b) Chip rack method - This method is allowed for licensees that are licensed with three or fewer tables. It requires a licensed center dealer, a game lay-out with a designated area for player fees, and a chip rack separated into sections for each type of fee collected. Fees are temporarily stored in the chip rack and controlled by a licensed dealer until collected by the floor supervisor. All chips collected as fees shall be removed from the dealer's chip rack at least every four hours by the licensed card room employee responsible for that particular section of the card room. The removal process shall include the counting of chips and coins in the presence of players and immediately recording the totals on the record prescribed by the commission. The dealer and the supervisor making the removal shall each initial the prescribed record verifying its accuracy.

(c) Drop box method - Fees are temporarily stored in a numbered, locked drop box. The drop box method requires a center dealer, a table with a designated area for each type of player fee and/or fees removed from the pot, and a separate drop box for each type of fee. Drop box movement, storage, and counting shall be conducted as prescribed in WAC 230-40-840. The drop box shall be located in a position that is isolated from the pot area and in plain view of all players and the surveillance system.

(4) No player shall be required to pay for or purchase any other goods or services as a condition of playing cards ((except as authorized by this section)): Provided, That:

(a) A bona fide nonprofit or charitable organization may charge its usual membership fee to belong to the organization; and

(b) Licensees may collect an admission fee when providing entertainment, as long as the fee is charged to all patrons;

(((c))) (5) A schedule setting forth all fees to participate in card games shall be posted in plain view where it can be seen by the players in the card games((.));

(((2))) (6) A person requesting a new deck of cards beyond those regularly furnished by the ((operator, as required by WAC 230-40-070(2),)) licensee may be charged a fee not to exceed the actual cost to the licensee ((of)) for the deck.      ((Further,)) Class D licensees may charge a fee not to exceed actual cost to the licensee per deck for each deck of playing cards furnished to a table as required by these rules, or as requested by any player at the table.      The fee shall be collected in cash directly from the players, or the player requesting the deck, at the time the deck is introduced into the game((.));

(((3) This rule shall not prevent a bona fide nonprofit or charitable organization which has been established and operated for purposes other than card playing from charging its usual membership fee to belong to the organization.

(4))) (7) The licensee shall collect the same fee from all players at a table ((except licensed card room employees or the licensed owner)).      If the licensee elects to allow free play, then all players at a table must be allowed to play for free((.

(5) The amount collected shall be recorded by the licensee each half hour on forms supplied by the commission.

(6) All records required by this rule shall be maintained for a period of three years from the end of the licensee's fiscal year for which the record is kept.

(7) This rule shall not prevent a licensee from collecting an admission fee for entry into that portion of the licensed premises conducting entertainment, provided that the same fee is charged to all patrons)): Provided, That a licensee may allow licensed card room employees and owners to play without a fee if fees are based on time, as authorized by subsection (1)(a) of this section.

[Statutory Authority: RCW 9.46.0281, 9.46.070 (1), (2), (4)-(8), (11), (12), (14) and (20).      96-19-082 (Order 300) § 230-40-050, filed 9/18/96, effective 10/19/96.      Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-050, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      94-17-091 (Order 256), § 230-40-050, filed 8/16/94, effective 9/16/94.      Statutory Authority: RCW 9.46.070 (1), (2), (4), (5), (6), (9), (11), (14) and (17) and 9.46.020 (19) and (23).      85-17-015 (Order 153), § 230-40-050, filed 8/12/85.      Statutory Authority: RCW 9.46.020 (20)(d), 9.46.050(3) and 9.46.070 (1), (2), (5), (8), (9), (11) and (12).      85-03-026 (Order 144), § 230-40-050, filed 1/9/85.      Statutory Authority: RCW 9.46.070 (8) and (17).      83-23-055 (Order 138), § 230-40-050, filed 11/15/83.      Statutory Authority: RCW 9.46.070(11).      82-11-028 (Order 120), § 230-40-050, filed 5/11/82; 80-09-067 (Order 103), § 230-40-050, filed 7/17/80; Order 72, § 230-40-050, filed 7/26/77; Order 42, § 230-40-050, filed 9/18/75; Order 38, § 230-40-050, filed 5/9/75; Emergency Order 37, § 230-40-050, filed 5/9/75; Order 35, § 230-40-050, filed 3/14/75; Order 29, § 230-40-050, filed 1/23/75; Order 23, § 230-40-050, filed 9/23/74.]

OTS-2903.4


AMENDATORY SECTION(Amending Order 192, filed 5/16/89)

WAC 230-40-070
Licensee to furnish all cards, chips and other services.

Each public card room and Class A social card room licensee shall furnish ((the following items and services)) all cards in connection with all card games conducted on its premises at no additional charge to the players((:

(1) Chips.      Chips for use in wagering shall be of generally conventional size and design.      Chips furnished by a licensee shall be so designed that they are readily identifiable as having been furnished by that particular licensee.

(2) Cards or mah-jongg tiles.      The deck, or decks of cards being used at a given table where any poker game is being played shall be changed at a minimum every half hour by the licensee.

Playing cards or mah-jongg tiles furnished shall be of generally conventional size and design.      Playing cards or tiles that have been shaved, sanded, cut, carved, or otherwise marked in any manner which may make certain cards or tiles identifiable to players other than as allowed by the rules of the particular game are prohibited.

(3))), except as provided in WAC 230-40-050(6). All chips and cards shall be of generally conventional size and design, and include safeguards that maximize the integrity of the card games. The following standards and procedures apply to this section:

(1) The licensee shall furnish chips and cards that meet the following requirements:

(a) Chips. Chips must include the house name or logo, clearly denote the chip value, be produced by a licensed manufacturer, and purchased from a licensed manufacturer or distributor: Provided, That the director may exempt Class E licensees with five tables or less from this provision if chips are readily identifiable as having been furnished by that particular licensee and values of chips are clearly posted in the card room; and

(b) Cards. The deck or decks of cards must include the house name or logo, be produced by a licensed manufacturer, and be purchased from a licensed manufacturer or distributor: Provided, That Class E licensees with five tables or less are exempt from this provision. These licensees shall comply with all other requirements related to the type of games being played.

(2) Bank services.      The licensee shall sell its chips to all players desiring to buy them ((not in excess of any limits set by the commission)) and redeem all chips at the value for which they were sold.      ((The value at which the various types of chips are sold and redeemed shall be conspicuously posted and visible to each person prior to that person purchasing chips.      Money taken in on chips sold and table fees collected shall be kept)) The licensee shall collect the money taken in on chips sold and fees collected and shall keep these funds separate and apart from all other money received by the licensee.

(((4))) (3) Chips ((may)) shall be sold for cash only and ((no)) a licensee shall not extend credit of any nature ((shall be extended by an operator)) to a person purchasing chips: Provided, That ((an operator)) a licensee may accept a check in accordance with WAC 230-12-053 and 230-40-845.      ((Counter checks are prohibited.))      Each receipt by a person of a quantity of chips from the ((operator)) licensee shall be a separate transaction for the purpose of this rule.      Checks received for chips retained by the ((operator)) licensee after close of business shall be deposited by the ((operator)) licensee not later than the second day following receipt upon which the ((operator's)) licensee's bank is open for business.

(((5) No licensee shall allow)) (4) The licensee shall safeguard all chips and cards to assure integrity of games and banking services and no licensee shall allow:

(a) Playing cards that have been shaved, sanded, cut, carved, or otherwise marked in any manner which may make certain cards identifiable to players other than as allowed by the rules of the particular game.

(b) Any cards or chips not furnished by the licensee ((on that business day)) to be used in any card game conducted upon its premises((.      No licensee shall allow)); or

(c) Any other person to buy or sell chips for use in card games upon its premises ((nor provide any other item or service for use in connection with the game)).

[Statutory Authority: RCW 9.46.070 (8), (11) and (14).      89-11-048 (Order 192), § 230-40-070, filed 5/16/89.      Statutory Authority: RCW 9.46.070 (11), (14) and 9.46.0218 [9.46.0281].      89-05-024 (Order 186), § 230-40-070, filed 2/13/89.      Statutory Authority: RCW 9.46.070 (1), (2), (4), (5), (6), (11), (14) and (17).      86-13-055 (Order 158), § 230-40-070, filed 6/13/86; Order 74, § 230-40-070, filed 8/17/77; Order 40, § 230-40-070, filed 6/26/75; Order 29, § 230-40-070, filed 1/23/75; Order 23, § 230-40-070, filed 9/23/74.]

OTS-2904.3


AMENDATORY SECTION(Amending Order 252, filed 6/15/94, effective 7/16/94)

WAC 230-40-120
Limits on wagers in card games.

Social and public card room licensees shall not allow wagering limits set by the commission to be exceeded in any card game.      The number and value of wagers in card games are limited as follows:

(1) ((The maximum number of wagers in any betting round shall be three, comprised of an initial wager plus two raises.

(2) The maximum number of a wager in any betting round shall be as follows:

(a) Games with a single betting round - ten dollars per wager;

(b) Games with multiple betting rounds:

(i) Two betting round games - wagers for the first round shall not exceed five dollars, and the second round shall not exceed ten dollars;

(ii) Three betting round games - wagers for the first two betting rounds shall not exceed five dollars, and wagers for the third betting round shall not exceed ten dollars;

(iii) Four betting round games - the wagers for each round may be structured by house rule: Provided, That the total wagers for all four betting rounds shall not exceed twenty-five dollars, and any single wager shall not exceed ten dollars; and

(iv) Five betting round games - the wagers for each round may be structured by house rule: Provided, That the total wagers for all five betting rounds shall not exceed thirty dollars, and any single wager shall not exceed ten dollars.

(c) Games that do not allow raises - single wager not to exceed ten dollars for each betting round.

(3))) Nonhouse-banked card games:

(a) Poker:

(i) There shall be no more than five betting rounds in any one game;

(ii) The maximum number of wagers in any betting round shall be four, comprised of an initial wager plus three raises; and

(iii) The maximum amount of a single wager shall not exceed twenty-five dollars.

(b) Games based on achieving a specific number of points - each point shall not exceed five cents in value.

(((4))) (c) An ante, except for panguingue (pan), shall not be more than ((ten dollars)) the maximum wager allowed for the first betting round for any game.      The ante may, by house rule, be made by one or more players, but the total ante may not exceed ((ten dollars)) the maximum wager allowed for the first betting round.      ((No one player can ante more than the maximum wager allowed in the first round.))      An ante, by house rule, may be used as part of a player's wager.

(((5))) (d) Panguingue (pan) - the maximum value of a chip for a payoff ((will)) shall not exceed ((four)) ten dollars.      An ante will not exceed one chip.      ((No)) Doubling of conditions is prohibited.      Players going out may collect not more than two chips from each participating player.

(((6) Provided, Washington blackjack shall be subject to the rules and wagering limits set forth in WAC 230-40-125.))

(2) House-banked card games:

(a) Licensees authorized to conduct Phase I house-banked card games shall not allow a single wager to exceed twenty-five dollars;

(b) Licensees authorized to conduct Phase II house-banked card games shall not allow a single wager to exceed one hundred dollars;

(c) A single wager may be made on each separate element of chance. In addition, for blackjack, an additional wager may be placed for doubling down or splitting pairs; and

(d) Bonus wagers for house-banked progressive jackpots shall not exceed one dollar. Bonus wagers with a predetermined prize amount based upon a separate element of chance within the same game shall not exceed the authorized maximum table limits as described in subsection (1)(a)(i) and (ii) of this section.

(3) House rules establishing wagering limits for each type of game played shall be posted in plain view where it can be seen by the players in the card game.

[Statutory Authority: RCW 9.46.070.      94-13-098 (Order 252), § 230-40-120, filed 6/15/94, effective 7/16/94.      Statutory Authority: RCW 34.05.220(4), [34.05].230 and 9.46.070 (11) and (14).      90-05-032 (Order 205), § 230-40-120, filed 2/14/90, effective 3/17/90.      Statutory Authority: RCW 9.46.070 (8), (11) and (14).      89-15-039 (Order 194), § 230-40-120, filed 7/18/89, effective 8/18/89.      Statutory Authority: RCW 9.46.050(3) and 9.46.070 (1), (2) and (11).      86-15-025 (Order 159), § 230-40-120, filed 7/14/86.      Statutory Authority: RCW 9.46.070 (1), (2) and (11) and 9.46.110.      85-21-046 (Order 154), § 230-40-120, filed 10/14/85.      Statutory Authority: RCW 9.46.020 (20)(d) and 9.46.070(11).      82-23-050 (Order 125) and 83-01-045 (Order 125A), § 230-40-120, filed 11/15/82 and 12/13/82.      Statutory Authority: RCW 9.46.070(11).      82-04-010 (Order 118), § 230-40-120, filed 1/22/82; 81-19-073 (Order 112), § 230-40-120, filed 9/15/81.      Statutory Authority: RCW 9.46.070(10).      80-03-059 (Order 98), § 230-40-120, filed 2/25/80; Order 80, § 230-40-120, filed 12/28/77; Order 51, § 230-40-120, filed 4/30/76; Order 48, § 230-40-120, filed 3/23/76; Order 23, § 230-40-120, filed 9/23/74.]

OTS-3683.1


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 230-40-125 Washington blackjack -- Rules of play -- Wagering limits.

OTS-2906.3


AMENDATORY SECTION(Amending Order 23, filed 9/23/74)

WAC 230-40-130
Wagers to be made with chips only.

All wagers and fees to play made in connection with a card game shall be made with chips furnished by the ((licensed premises. No money, nor other thing of value, shall be used directly in the game itself)) licensee: Provided, That house-banked card games may use coins with a value of fifty cents or twenty-five cents: Provided further, That coins with a value of less than twenty-five cents may be used for pai gow poker games.

[Order 23, § 230-40-130, filed 9/23/74.]

OTS-2907.2


AMENDATORY SECTION(Amending WSR 95-23-109, filed 11/22/95, effective 1/1/96)

WAC 230-40-200
((Participants)) Players to compete on equal terms -- Deal to rotate among players.

((Participants)) Players in card games shall compete on equal terms with all other ((participants)) players in the game, and solely as a ((participant)) player therein.

The deal in any series of nonhouse-banked card games shall be passed from player to player, unless the table incorporates a house dealer as per house rule.      No player who deals a game shall deal another game until each other player at the table has dealt a game in his turn: Provided, That any player may voluntarily waive his right to deal any particular game.

((Licensees shall take all necessary measures to insure that card games played upon their premises are played in this manner.))

[Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-200, filed 11/22/95, effective 1/1/96.      Order 40, § 230-40-200, filed 6/26/75; Order 23, § 230-40-200, filed 9/23/74.]

OTS-2908.4


AMENDATORY SECTION(Amending WSR 95-23-109, filed 11/22/95, effective 1/1/96)

WAC 230-40-225
House dealer allowed in certain games.

((Notwithstanding the provisions of WAC 230-40-200,)) Any licensee may furnish a dealer ((or "mucker")) in any ((Washington blackjack, pan or poker)) game played on the licensed premises.      Dealers shall have no financial interest, directly or indirectly, in the outcome of such game and shall not otherwise participate or play in the game: Provided, That a licensee shall be required to have a house dealer for all house-banked card games, card games operated with a player-supported jackpot, or card games authorized to assess fees for each hand played or fees based on amounts wagered.

[Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-225, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      94-13-098 (Order 252), § 230-40-225, filed 6/15/94, effective 7/16/94; Order 29, § 230-40-225, filed 1/23/75.]

OTS-2909.4


AMENDATORY SECTION(Amending WSR 95-23-109, filed 11/22/95, effective 1/1/96)

WAC 230-40-400
Hours ((limited)) for card games--Procedures for changing hours.

The hours during which card games may be played in licensed public card rooms shall be limited as follows:

(1) Licensees shall not allow the use of their premises for card playing between the hours of 2:00 a.m. and 6:00 a.m.: Provided, That the director may allow closing hours to be adjusted beyond 2:00 a.m. as long as the following conditions ((remain in effect)) are met:

(a) ((The local law enforcement agency with jurisdiction concurs;

(b) Other state agencies involved in regulation of the business do not object; and)) The director shall consult with the local law enforcement agency which has jurisdiction;

(b) The director shall consult with other state agencies involved in regulation of the business;

(c) A licensee must observe a four-hour period of closure at the end of each business day before beginning the next period of operation.

(((2))) (d) The food and/or drink business being stimulated shall be open to the public for business any time card games are conducted((: Provided, That entry to the business by new customers may be limited if access to the premises is open to the commission, law enforcement, or other state or local regulatory agencies, and service of food and nonalcoholic beverages is available for customers remaining on the premises after 2:00 a.m.));

(((3))) (e) At all times during the hours of operation of a Class E, F or house-banked card room, ((the operator or)) a licensed card room employee must be on duty and in the licensed card room area; and

(f) The licensee complies with any other terms and conditions imposed by the director.

(2) The director may deny the request for extended hours or revoke hours already approved if the local law enforcement agency or a state agency objects or if the director determines that the licensee has violated any provisions of chapter 9.46 RCW, any other commission rule, or any of the terms set forth in subsection (1) of this section. All objections to changing a licensee's operating hours or requests to revoke an approved operating schedule must be submitted in writing.

(3) The commission shall afford a licensee an opportunity for a brief adjudicative proceeding prior to denying or revoking the licensee's authorization for extended card room hours. The brief adjudicative proceeding shall be heard by an administrative law judge, under the provisions set forth in WAC 230-50-010(6), and RCW 34.05.482 through 34.05.494.

[Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-400, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      95-13-024, § 230-40-400, filed 6/13/95, effective 7/14/95.      Statutory Authority: RCW 9.46.070(11).      82-04-010 (Order 118), § 230-40-400, filed 1/22/82; Order 58, § 230-40-400, filed 8/17/76; Order 40, § 230-40-400, filed 6/26/75; Order 23, § 230-40-400, filed 9/23/74.]

OTS-2910.3


AMENDATORY SECTION(Amending WSR 97-14-013, filed 6/20/97, effective 7/21/97)

WAC 230-50-010
Adjudicative proceedings -- Hearings.

(1) ((Adjudicated)) Adjudicative proceedings shall be commenced for any and all matters wherein the commission is causing administrative charges to be brought against any applicant, licensee or permittee within the limitations to chapter 34.05 RCW as applicable.

(2) The commission shall afford an applicant for a license an opportunity for an ((adjudicated)) adjudicative proceeding prior to denying such application, and shall afford a licensee the opportunity for an ((adjudicated)) adjudicative proceeding prior to suspending or revoking a license.

(3) The commission will afford a person applying to the commission for approval of a pull-tab dispensing device under WAC 230-30-095 an opportunity for an ((adjudicated)) adjudicative proceeding prior to denying approval of such device.

(4) No hearing will be conducted with respect to any ((adjudicated)) adjudicative proceeding unless an application for an ((adjudicated)) adjudicative proceeding and request for hearing is timely filed by the applicant or licensee with the commission in compliance with WAC 230-50-210.      The application must be made upon a form to be obtained from the commission, or facsimile thereof, and must be received within 20 days following service upon the party affected by the commission or the director of a notice of administrative charges and opportunity for an ((adjudicated)) adjudicative proceeding.      Said document shall contain the maximum penalty that may be assessed should an application not be filed by the party affected.      An application for an ((adjudicated)) adjudicative proceeding and request for hearing shall accompany all notices of administrative charges.

(5) If an application for an ((adjudicated)) adjudicative proceeding is not timely filed, then the party affected shall have waived the right to a hearing on the allegations set forth in the notice of administrative charges.      The party shall be deemed to be in default pursuant to RCW 34.05.440 and the commission and director may take action against the party not to exceed the maximum penalty as stated in the notice of administrative charges and opportunity for an ((adjudicated)) adjudicative proceeding, which action shall be final.

(6) The procedures of RCW 34.05.485, brief adjudicative proceedings, shall be used for the following purposes:

(a) All hearings in which the penalty sought by the commission is for a suspension of seven days or less;

(b) Hearings held pursuant to WAC 230-50-015 (stay of summary suspension);

(c) Hearings held pursuant to WAC 230-04-400(3) (failure to pay required gambling taxes);

(d) Hearings held pursuant to WAC 230-04-190 (10)(c) (two part payment plan: Failure to make second payment);

(e) Hearings in which the parties have stipulated to facts or the parties have stipulated to charges, and the hearing is limited to a determination of whether facts constitute violations as charged and/or determination of appropriate penalty to be imposed;

(f) Denial of an application to operate at a higher bingo license class when the licensee has been restricted by WAC 230-20-062;

(g) Petitions for a variance to bingo net return requirements authorized by WAC 230-20-060; ((or))

(h) Denial or revocation of extended card room hours pursuant to WAC 230-40-400;

(i) Denial of request for Phase II pursuant to WAC 230-40-810;

(j) Repeal of an approved card game pursuant to WAC 230-40-010; or

(k) Where the parties have stipulated to the use of brief adjudicative proceedings.

[Statutory Authority: RCW 9.46.070 (1), (2).      97-14-013, § 230-50-010, filed 6/20/97, effective 7/21/97.      Statutory Authority: RCW 9.46.070.      95-13-030, § 230-50-010, filed 6/13/95, effective 7/14/95; 92-19-107 (Order 231), § 230-50-010, filed 9/18/92, effective 10/19/92.      Statutory Authority: Chapter 34.05 RCW.      89-24-003 (Order 200), § 230-50-010, filed 11/27/89, effective 12/28/89.      Statutory Authority: RCW 9.46.070(13).      80-03-059 (Order 98), § 230-50-010, filed 2/25/80; Order 45, § 230-50-010, filed 12/30/75; Order 9, § 230-50-010, filed 12/19/73.]

OTS-3726.2


NEW SECTION
WAC 230-40-600
Authorization procedures for player-supported jackpots.

Player-supported jackpots (PSJs) shall be tightly controlled and shall not be operated prior to approval by the director or the director's designee. The following procedures apply to approval of PSJs:

(1) The request shall be in writing and include at least the following:

(a) A detailed description of the game;

(b) All internal control procedures associated with controlling the game and accounting for fees and prizes;

(c) All rules of play; and

(d) The name of the prize fund custodian.

(2) Any changes to the approved game or applicable internal controls must be forwarded to the commission staff for review and approval prior to implementation.

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OTS-3727.3


NEW SECTION
WAC 230-40-610
Player-supported jackpots -- Restrictions -- Manner of conducting -- Approval.

A player-supported jackpot (PSJ) is a separate contest of chance directly related to the play and/or outcome of authorized nonhouse-banked card games but which is not the card game itself. Card rooms with a Class F or house-banked license may establish a prize fund for the purpose of operating a PSJ for nonhouse-banked card games. Any PSJ must be approved in writing by the director or the director's designee prior to play. A PSJ must meet the following requirements:

(1) Funding of a PSJ: A licensee may provide house funds to establish a PSJ. The licensee shall issue a check from the general business account into the PSJ account to start the prize fund. Recouping of start-up funds shall be done by issuing a check from the PSJ account to the business general account. Electronic bank transfers shall satisfy this requirement. Start-up funds shall not exceed five thousand dollars per PSJ.

(2) A licensee may assess a portion of player's wagers for a jackpot prize. Such amount shall not exceed one dollar per hand or game for each PSJ. This assessment shall be separately collected using the rake method.

(3) The licensee acts only as the custodian of the PSJ funds and maintains no legal right to the funds. All PSJ funds shall be awarded as prizes. PSJ funds shall only be used for awarding cash prizes based upon a format approved by commission staff. An administrative fee not to exceed ten percent of the amount collected for a PSJ may be imposed by the licensee.

(4) Each licensee shall designate at least one "prize fund custodian" who shall be responsible for safeguarding and disbursing funds to winners. A prize fund custodian may be an owner, partner, officer, or licensed individual designated by a card room owner, partner, or officer. The custodian shall have signature authority for prize fund bank accounts and ensure accountability of all funds collected for use in a PSJ. The licensee shall meet the deposit requirements of WAC 230-12-072.

(5) Prize amounts paid in cash shall not exceed five hundred dollars. Prize amounts not awarded in cash shall be paid by check, the type which provides a duplicate copy, which shall not be cashed on the licensee's premises. A record of all prizes paid shall be maintained in the format prescribed by commission staff and shall include:

(a) For prizes less than one hundred dollars, a system of accounting denoting each individual prize may be utilized.

(b) For prizes one hundred dollars and above, the following information shall be recorded on a prize record:

(i) Full printed name;

(ii) Date of birth;

(iii) Street address;

(iv) Type of identification reviewed;

(v) Amount of the prize awarded;

(vi) Description of the winning hand;

(vii) Time and date awarded; and

(viii) The supervisor's, dealer's and winner's initials.

(c) Upon awarding a prize of five hundred dollars or more, the dealer shall fan the winning hand in view of the surveillance camera. The hand shall be collected and sealed with the prize record. The winning hand and remaining deck shall be maintained on the premises as part of daily card room records for a period of seven days, unless released by a commission agent.

(6) Owners and on-duty card room employees may participate in card games that offer a PSJ, but may not share in the winnings of any prize awarded. If playing in a game with a PSJ, owners and card room employees must turn their cards face up at the end of each game so that the cards may be observed by other players at the table and surveillance. Any prize winnings an owner or on-duty employee may be entitled to under game rules, must be divided equally among the other players at the table: Provided, That off-duty employees may participate in card games that offer a PSJ and share in the prize winnings.

(7) All card games offering a PSJ must utilize a house dealer.

(8) Security requirements: Each gaming table offering a PSJ shall be required to install a closed circuit television system as outlined in WAC 230-40-825.

(9) In the event that a licensee ceases to operate a card room, fails to maintain a valid card room license, or discontinues a PSJ, the balance (less any nonrecouped seed money) of all PSJ accounts will be forwarded to the Washington State Council on Problem Gambling: Provided, That a licensee may seek approval from the director or the director's designee to revise their prize contests in order to distribute all accumulated prize funds.

(10) House rules to include administrative fees shall be posted in a location readily visible by all players and disclose the conditions under which prizes may be won, the prize amount, cost to participate, and any other conditions which may affect the outcome of the game.

(11) If a dispute arises involving the outcome of a PSJ, the licensee shall preserve the video recording, the winning hand and remaining deck, and all records for the game where the dispute occurred and shall notify commission staff within twenty-four hours. The licensee shall document all information pertaining to the dispute including:

(a) The names, addresses, and phone numbers of all players, card room staff, and any witnesses involved;

(b) Amount of the advertised PSJ; and

(c) A full description of the circumstances surrounding the dispute.

(12) All disputes involving a PSJ will be investigated by commission staff, with a report submitted to the director. A written decision will be issued by the director, or the director's designee, and such decision shall be final.

(13) During the course of dispute resolution, the commission may become the temporary custodian of any and all prize funds. The PSJ will be suspended until the dispute is resolved.

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OTS-3728.1


NEW SECTION
WAC 230-40-615
Nonhouse-banked card games -- Administrative and accounting control structure -- Organization.

Licensees conducting activities that require a Class F license shall assure that such activities are closely controlled. Class F licensees shall comply with the following additional requirements:

(1) Establish a system of internal administrative and accounting controls that requires, at a minimum, the following:

(a) Trained personnel;

(b) Segregation of duties for all employees involved in the operation;

(c) Fee collection and funds safeguarding procedures;

(d) Playing card and chip inventory; and

(e) Security and supervision requirements.

(2) The licensee shall have adequate licensed employees to assure commission requirements are met. At a minimum, the following employees are required:

(a) At least one supervisor for every five tables shall be required: Provided, That a single supervisor may supervise up to seven tables, if only seven tables are in operation and the layout was preapproved by commission staff;

(b) A licensee which utilizes two separate areas of a particular gaming establishment shall require at least one supervisor in each area; and

(c) The licensee must have at least two licensed card room employees in the card room at all times player-supported jackpot schemes are in play and/or alternative methods of collection are being utilized. One such employee must be a floor supervisor.

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OTS-3729.1


NEW SECTION
WAC 230-40-800
Operating rules for house-banked card games.

Licensees that operate house-banked card games shall establish rules and procedures governing each specific house-banked card game played at their premises. The following restrictions and procedures apply:

(1) House-banked card games shall not be operated prior to approval as set forth in WAC 230-40-010;

(2) All house-banked card games shall be dealt from a dealing shoe or an approved shuffling device;

(3) The licensee shall submit all rules governing the game to commission staff for approval. All requests shall be in writing and include at least the following:

(a) Rules of play, including those specified by the manufacturer or supplier;

(b) Any administrative or accounting controls applicable to specific games;

(c) All specifications provided by the equipment manufacturer or supplier applicable to gaming equipment utilized in the game;

(d) Physical characteristics of the following:

(i) Cards (including procedures for receipt and storage);

(ii) Gaming chips used to play the game;

(iii) All gaming tables and layouts;

(iv) Dealing shoes;

(v) Card shuffling devices;

(vi) Card peeking devices;

(vii) Bill changer devices; and

(viii) Such other equipment as may be required for use in otherwise authorized games;

(4) Rules for each authorized game, shall include at least the following:

(a) Procedures of play;

(b) Minimum and maximum permissible wagers;

(c) Shuffling, cutting, and dealing techniques, as applicable;

(d) Dealer take and pay procedures;

(e) Payout odds on each form of wager, including any factors affecting payments to the player, such as maximum player or aggregate prize restrictions; and

(f) Procedures to be followed on occurrence of irregularities, including examples of irregularities applicable to each game;

(5) A summary of playing procedures and rules of play for each game shall be visibly displayed in the gaming area. If the procedures or restrictions are game specific, they shall be displayed at each gaming table at which the game is played;

(6) Full details on all promotions, schemes or other means used to promote card games operated in card rooms which offer house-banked card games must be submitted to commission staff and be approved prior to implementing.

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OTS-3803.1


NEW SECTION
WAC 230-40-803
Phase II wager limits -- Restrictions -- Procedures.

A house-banked card room licensee shall not increase wager limits to Phase II levels prior to demonstrating that it is capable of operating at higher wager limits and receiving commission approval. The following procedures and restrictions apply to the Phase II approval process:


Restrictions.


(1) Prior to requesting approval for Phase II limits a licensee shall:

(a) Operate at Phase I limits for a minimum of six months;

(b) Have demonstrated compliance with commission requirements. A licensee shall be deemed to have demonstrated compliance when:

(i) Administrative actions are not pending;

(ii) Administrative actions have not occurred for at least the last six months; and

(iii) It is not currently under investigation by the commission or other law enforcement agency; and

(c) Have paid all gambling taxes due to counties, cities, or towns. For purposes of this section, gambling taxes include those taxes owed as of the most recent reporting period (month or quarter), as provided in the jurisdiction's ordinance, plus any interest and/or penalties that may be due.


Review procedures.


(2) Requests for an increase in wagering limits shall be processed in the following manner:

(a) The licensee shall submit a written request for review, including a deposit of five thousand dollars to pay for the review;

(b) Commission staff shall review the licensee's entire house-banked card game operation. Such review shall include an evaluation of:

(i) The licensee's written internal accounting and administrative controls to ensure they are not materially different from those submitted and approved and that the licensee is following such in every material aspect;

(ii) The licensee is operating house-banked card games in accordance with applicable WAC rules; and

(c) A summary of the staff's findings and a recommendation shall be presented to the commission at a regular public meeting.


Approval process.


(3) Upon the completion of the staff's review, the director may authorize a licensee to increase Phase II wagering limits for up to five tables pending commission approval at the next scheduled meeting;

(4) The director may decline to forward a licensee's request for Phase II wagering limits to the commission if:

(a) The licensee has failed to comply with any of the restrictions set forth in subsection (1) of this section; or

(b) The staff's review reveals the licensee has failed to follow its approved internal control procedures and such failures are material or, because of repetition, would be material; or

(c) Material violations of WAC rules are noted; and

(d) Actions to correct any deficiencies have not been completed and staff afforded adequate time to conduct follow-up review.

(5) If the director fails to forward a licensee's request within sixty days following completion of the staff's review and has not commenced administrative actions, a licensee shall be afforded an opportunity to a commission review of the request. The commission may:

(a) Grant the licensee Phase II wager limit approval;

(b) Grant the licensee conditional Phase II approval; or

(c) Refer the request back to the staff for further investigation.

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OTS-3731.1


NEW SECTION
WAC 230-40-805
House-banked progressive jackpot prizes -- Procedures -- Restrictions.

Licensees are authorized to operate progressive jackpot prizes in conjunction with approved house-banked card games. Entry into a progressive jackpot is based upon a separate wager by a player, part of which accrues to a progressively increasing prize. A player wins the jackpot prize, or portion thereof, based upon achieving a predetermined pattern or combination of cards. Each licensee operating such games shall ensure they are closely controlled, all the funds collected are accounted for, and prizes and methods of winning are adequately disclosed to players. The following procedures and restrictions apply to progressive jackpots:

(1) House-banked progressive jackpot restrictions:

(a) The amount of funds accrued to the primary and reserve or secondary jackpots shall increase by a predetermined amount of each wager made, in accordance with the rules of the game;

(b) The amount of the progressive jackpot eligible to be awarded as a prize shall be prominently displayed at each gaming table;

(c) The beginning amount of each progressive jackpot offered must be recorded, including explanations for any increase or decrease in the amount of the prize offered. This documentation shall be maintained with the progressive jackpot records; and

(d) A licensee may establish a maximum limitation on a progressive jackpot prize. If such a limit is established:

(i) The amount must be equal to or greater than the amount of the jackpot when the limit is imposed; and

(ii) A notice of the limit must be conspicuously posted at or near the game;

(2) A licensee shall not reduce the amount of a progressive jackpot prize, except as authorized by this section, including reserve or secondary jackpots, that have been accrued and displayed to players. The following adjustments are allowed to accrue progressive jackpot prizes:

(a) Prizes may be paid when a player wins the jackpot or a portion thereof. In such instances, the jackpot and advertised amount shall be reduced only by the amount won;

(b) An adjustment may be made to correct malfunctioning equipment or to prevent the display of an amount greater than a predetermined maximum prize limit; or

(c) A reserve or secondary jackpot may be reduced to recover a seed amount as long as it is properly documented in the records;

(3) House-banked progressive jackpot prizes, including any reserve or secondary jackpots, are deemed to be funds for which players have a vested interest and may only be removed from play under the following conditions:

(a) The director provides the licensee written approval of a plan to disburse all jackpot funds back to the players. The request for approval shall include full details of the distribution plan; and

(b) The licensee must notify players of any planned discontinuance, including closure of the business, by conspicuously posting notice for a period of ten days prior to beginning the discontinuance process;

(4) A licensee may temporarily remove a progressive jackpot game from play subject to the following conditions:

(a) The removal and reasons must be approved in writing by commission staff; and

(b) The disruption is caused by circumstances beyond the control of the licensee, or for other good cause (for example: Remodeling the card room); and

(c) Players are notified of the disruption and the estimated date of continuance.

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OTS-3732.2


NEW SECTION
WAC 230-40-810
House-banked card games -- Odds based wagers -- Prizes -- Restrictions -- Procedures.

A licensee may establish pay out limits for odds based wagers made at house-banked card games. An "odds based wager" means a wager for which the player is paid an increased amount over and above the amount wagered if a predetermined pattern or combination of cards is achieved. For example, a royal flush, four aces, a pair, etc. Limitations on the payout for odds based wagers are allowed only if the following restrictions and procedures are met:

(1) All payout limits, procedures for computing limits, and methods of disclosing limits to patrons shall be preapproved by the director or designee;

(2) Any limits applied to individual players' winnings shall not be less than the higher of the following calculations:

(a) The maximum wager allowed for the game, times the highest odds offered up to fifty-to-one (50 to 1). For example: The maximum wager is one hundred dollars ($100) and odds are fifty-to-one (50 to 1); then the per player minimum is five thousand dollars ($100 x 50 = $5,000); or

(b) The minimum required wager for the game, as determined by house rule, times the highest odds offered for any wager in the game. For purposes of this section the "minimum required wager" shall be the total amount a player must risk in order to win. For example: The minimum allowed wager is ten dollars ($10) and the maximum odds are one thousand-to-one (1,000 to 1); then the per player minimum is ten thousand dollars ($10 x 1,000 = $10,000);

(3) Any limits applied in aggregate to payments to all players in a game for winning wagers shall not be less than two times the individual player limit, as computed in subsection (2) of this section;

(4) The licensee shall clearly disclose any limits to per player or aggregate payouts on the table layout: Provided, That the director may approve alternative methods of disclosure; and

(5) The licensee shall clearly disclose all procedures for computing any per player or aggregate payouts. This explanation must be available to players in the form of a brochure or other printed media.

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OTS-3733.1


NEW SECTION
WAC 230-40-815
House-banked card games -- Administrative and accounting control structure -- Organization.

Each licensee operating a house-banked card game shall ensure that all games are closely controlled, operated fairly and in accordance with all rules of the commission. The following control procedures and conditions shall be met:

(1) The licensee shall have a system of internal controls that include at least the following:

(a) Administrative controls, which include, but are not limited to, the organization's plan, procedures, and records concerned with decision processes leading to management's authorization of transactions; and

(b) Accounting controls which include the licensee's plan, procedures, and records concerned with the safeguarding of assets and the reliability of financial records. These controls must be designed to provide reasonable assurance that:

(i) Transactions are executed in accordance with management's general and specific authorization;

(ii) Transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles, and to maintain accountability for assets;

(iii) Access to assets is permitted only in accordance with management's authorization; and

(iv) The recorded accountability for assets is compared with existing assets at least annually and appropriate action is taken within five working days with respect to any differences.

(2) The licensee's system of administrative controls shall provide for the following:

(a) Competent personnel with an understanding of prescribed procedures;

(b) The segregation of incompatible functions so that no employee is in a position to perpetrate and conceal errors or irregularities in the normal course of his or her duties; and

(c) Each employee of a house-banked card room shall be licensed by the commission and shall be knowledgeable in all accounting and internal control practices and procedures relevant to each employee's individual function.

(3) The licensee shall, at a minimum, establish the following departments or functions that shall be independent from all other departments or functions:

(a) A surveillance department which shall not include security functions or personnel. The head of surveillance shall be responsible for, but not limited to, the following:

(i) The clandestine surveillance of the operation and conduct of the table games;

(ii) The clandestine surveillance of the operation of the cashier's cage;

(iii) The video and audio taping of activities in the count rooms;

(iv) The detection of cheating, theft, embezzlement, and other illegal activities in the gaming facility, count rooms, and cashier's cage;

(v) The video taping of unusual or suspected illegal activities;

(vi) The notification of appropriate supervisors and commission staff, within three working days, upon the detection of cheating, theft, embezzlement, or other illegal activities; and

(vii) Ensuring that each dealer is evaluated to determine if all required dealer procedures and techniques set forth in the licensee's approved internal controls are followed.

(b) A security department responsible for at least the following:

(i) Control of cards and dealing shoes, including storage of new and used cards and shoes, and control of the disposition and/or destruction of same when removed from service; and

(ii) Transfer of cash and chips to and from the gaming tables, cage and count room.

(c) A gaming operation department supervised by a gaming operation department manager who shall be responsible for the operation of all house-banked card games conducted by ensuring the following:

(i) Card games are operated by licensed dealers who are assigned to each gaming table;

(ii) A floor supervisor is assigned the responsibility for the overall supervision of the conduct of gaming within a pit and can supervise no more than five tables: Provided, That a single supervisor may supervise up to seven tables, if only seven tables are in operation and the layout was preapproved by commission staff. The shift manager shall oversee floor supervisors and report to the gaming operation department manager; and

(iii) A shift manager, who reports to the gaming operation department manager, is assigned to supervise all gaming related activities that occur during each shift. In the absence of the gaming operation department manager, the shift manager shall have the authority of a gaming operation department manager: Provided, That licensees who are licensed for five or fewer tables and are operating at Phase I limits may operate with one level of supervision on the gaming floor. All tables must be in one pit and the supervisor in charge must be on the gaming floor at all times.

(d) An accounting department supervised by an individual who shall report directly to the CEO or COO. The responsibilities of the accounting department shall include, but not be limited to, the following:

(i) Implementing and monitoring of accounting controls;

(ii) The preparation, control, and storage of records and data required;

(iii) The control of unused forms inventory along with reconciliation of forms used; and

(iv) The control and supervision of the cashier's cage.

(4) Any changes to the licensee's system of internal controls must be submitted to commission staff and be approved prior to implementation.

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OTS-3734.2


NEW SECTION
WAC 230-40-820
House-banked card games -- Internal control system evaluation -- Required procedures.

Each licensee operating house-banked card games shall provide an operating environment that will assure that commission rules are adhered to and results of operations can be confirmed by commission staff. In order to assure compliance with this requirement, a complete evaluation of the licensee's system of internal administrative and accounting control procedures shall be completed annually. This evaluation shall be independent of all normal regulatory functions performed by the commission staff. A report documenting the results of the evaluation, including any material discrepancies noted and any corrective actions taken, shall be provided to the licensee. The following restrictions and procedures apply to this process:

(1) The evaluation shall be completed by commission staff: Provided, That if commission staff are not available, the licensee, with prior approval, may utilize any of the following:

(a) A certified public accountant (CPA) that is independent in regard to the licensee and which is licensed to perform such engagements by the state of Washington. Prior to entering into a contract for such services, a CPA shall demonstrate adequate knowledge and experience in gambling, and commission rules, procedures and standards. The CPA may be engaged as follows: A copy of an engagement letter from the licensed CPA shall be submitted to the commission at least thirty days prior to offering services. The letter shall include an acknowledgement that the evaluation is being conducted under regulatory requirements of the commission and that a copy of the report will be forwarded to the commission; or

(b) A certified public accountant (CPA) which is licensed to perform such engagements by the state of Washington and is performing a review or audit of the licensee's financial statements. Licensees wishing to use this method of compliance shall receive written approval from the director or designee. In addition, the CPA's engagement letter shall acknowledge:

(i) The evaluation of internal controls is being conducted under regulatory requirements of the commission;

(ii) The service includes a written report on the adequacy of internal administrative and accounting control procedures utilized in the gaming operation and the degree to which the licensee complied with such; and

(iii) The commission is granted access to the accountant's work papers; or

(c) A licensed gambling service supplier that:

(i) Is independent in regard to the licensee being evaluated;

(ii) Demonstrates that all persons involved in performing the evaluation have adequate knowledge and experience in gambling, and commission rules, procedures and standards; and

(iii) Assures all work related to the evaluation of internal controls and the report to the commission is performed by or under the supervision of a licensed CPA meeting the requirements noted in (a) of this subsection;

(2) The evaluation, if conducted by other than commission staff, shall be completed annually, with the cycle beginning one year from the date of initial license approval: Provided, That an evaluation and report may not be required during any period that the licensee has satisfactorily completed a Phase II review, as set forth in WAC 230-40-803, if the review was completed within six months of the scheduled review period: Provided further, That the director may extend the date for evaluation completion if a request is made by the licensee;

(3) If a CPA under contract with a licensee or a licensed service supplier completes the evaluation, the report shall be submitted to the licensee and commission no later than thirty days following completion of the evaluation;

(4) The licensee shall take corrective actions on all deficiencies noted and a report of corrective actions forwarded to the commission no later than thirty days after notification: Provided, That the director may extend the time for correction if the licensee can demonstrate extenuating circumstances and that alternative controls are in place: Provided further, That the director may issue administrative charges on violations that are deemed serious in nature;

(5) The licensee is responsible for all cost of internal control evaluations and the commission shall be reimbursed for evaluations conducted by commission staff or a contractor hired by the commission. The licensee shall pay the contractor within thirty days after receiving a final bill for evaluation services. Failure to pay such bills shall be prima facie evidence of a lack of independence between the parties;

(6) Licensees meeting the following criteria shall have a complete internal control evaluation performed at least once every two years beginning two years from the date of initial license approval:

(a) The licensee waived the opportunity for Phase II status; and

(b) Card room gross receipts do not exceed fifty thousand dollars per month, annualized over a twelve-month period. The evaluation of gross receipts will be based upon no less than six months operating activity.

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OTS-3735.2


NEW SECTION
WAC 230-40-823
House-banked card games -- Financial audits required.

Each licensee operating house-banked card games with gross receipts in excess of five million dollars per year shall have their financial statements examined by a licensed, independent certified public accountant (CPA) for each fiscal year to evaluate the fairness of the presentation of the statements in conformity with generally accepted accounting principles. This examination shall be conducted in accordance with generally accepted auditing standards. A copy of the report and financial statements shall be submitted to the commission no later than one hundred twenty days after conclusion of the fiscal year. The director or designee may extend the date for audit completion if a request is made by the licensee.

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OTS-3736.1


NEW SECTION
WAC 230-40-825
Closed circuit television system requirements and procedures.

All activities related to the operation of card games shall be closely monitored. Critical activities related to house-banked card games, player-supported jackpots and assessment of fees based on amounts wagered (rake method) shall be monitored by use of a closed circuit television system and a video recording. The following restrictions and operating procedures apply when a closed circuit television system is required.

(1) Each licensee shall install and maintain a closed circuit television system that meets at least the specifications set forth below:

(a) Light sensitive cameras with pan, tilt, and zoom (PTZ) capabilities where necessary to effectively and clandestinely monitor in detail and from various vantage points, including the following:

(i) The gaming conducted at each gaming table in the facility;

(ii) The activities in the pits;

(iii) Each table game area, with sufficient clarity to identify patrons and dealers;

(iv) Each table game surface, with sufficient coverage and clarity to simultaneously view the table bank and determine the configuration of wagers, card values and game outcome;

(v) The operations conducted at and in the cashier's cage: Provided, That for Class F licensee, camera coverage shall not be required of the cashier's cage unless the count is conducted at that location;

(vi) Entrance to the cashier's cage;

(vii) The count processes conducted in the count rooms, which processes shall be in conformity with commission rules;

(viii) The movement of cash, gaming chips, and drop boxes in the establishment;

(ix) The entrances and exits to the card room and the count rooms; and

(x) Such other areas as the commission designates.

(b) All video cameras must be installed in a manner that will prevent them from being readily obstructed, tampered with, or disabled by patrons or employees.

(c) Where a PTZ camera is used to observe card tables and gambling related activities, the camera must be placed behind a smoked dome, one-way mirror or similar materials that conceal the camera from view.

(d) Video recording units, with time and date insertion capabilities, for recording what is being viewed by any camera of the system. Recording and playback of video signals shall be at a rate of not less than twenty frames per second and shall not be recorded in a manner that will not allow playback on a standard consumer grade video cassette recorder. If multiple time and date generators are used, they shall be synchronized to the same time and date. The displayed date and time shall not significantly obstruct the recorded view. The following locations or activities shall be video taped:

(i) All gaming stations in operation or in which drop boxes are stored, to include video recording of all items noted in (a)(i) through (viii) of this subsection;

(ii) All entries to the count room;

(iii) The entire count process, including audio recording (audio recording only required for house-banked card room licensees);

(iv) Any unusual or suspicious activities;

(v) Movement of drop boxes between tables and the count room; and

(vi) Any other activity or location designated by commission staff.

(2) Lighting to provide sufficient clarity shall be present in all areas, including gaming tables and pits, where closed circuit camera coverage is required.

(3) Each video camera required by these rules shall be capable of having its picture displayed on a video monitor and recorded.

(4) The surveillance system must include a sufficient number of monitors to simultaneously display multiple card tables, the cashier's cage, count room activities, and views of any dedicated cameras.

(5) Multiplexing/quad recording devices may only be used for external surveillance, movement of drop boxes between tables and the count room, and on entrances and exits: Provided, That split screen devices may be utilized for areas not required to have surveillance coverage.

(6) The licensee shall maintain one or more surveillance rooms with the following minimum requirements:

(a) The surveillance room shall have controlled access, and be used solely by the employees of the surveillance department assigned to monitor activities: Provided, That this restriction does not apply to owners or approved supervisory or management personnel. Commission agents and law enforcement personnel shall be provided immediate access to the surveillance room upon request.

(b) A house-banked card game licensee shall ensure that a surveillance employee is present in the surveillance room and monitoring the activities of the operation, via the surveillance room equipment, at all times the card room is open to conduct gaming and during the count process as stated in WAC 230-40-885(4): Provided, That the licensee may allow the surveillance room to operate without staff for a period not to exceed thirty minutes per shift for the purpose of routine breaks. All surveillance employees shall have a demonstrated knowledge of the following:

(i) Operating surveillance systems;

(ii) Rules of play and procedures for the games being played; and

(iii) The overall procedures relating to the duties of all employees of a house-banked card room being monitored (dealers, shift managers, floor supervisors, cage personnel, and count team).

(c) Licensees that are licensed for five or fewer tables and operating under Phase I limits, shall not be required to maintain a staffed surveillance room.

(d) The licensee shall maintain a record of all surveillance activities in the surveillance room. The surveillance log shall be maintained by surveillance personnel and shall include, at a minimum, the following:

(i) Date and time of surveillance;

(ii) Person initiating surveillance;

(iii) Reason for surveillance;

(iv) Time of termination of surveillance;

(v) Summary of the results of the surveillance; and

(vi) A record of any equipment or camera malfunctions.

(e) A surveillance room sign-in log shall be maintained to document the time each surveillance employee monitors the card room. A surveillance room sign-in log shall be available for inspection at any time by commission staff or local law enforcement.

(7) Video and audio tapes shall be identified to denote the activity recorded and retained for a period necessary to afford commission staff or law enforcement personnel reasonable access. The following minimum retention periods apply to tapes:

(a) All tapes shall be retained for a minimum of seven days: Provided, That the seven-day retention period may be measured on a weekly and per shift basis as long as tapes are uniformly labeled by day of the week and shift;

(b) Tapes of evidentiary value shall be maintained as requested by commission staff;

(c) Tapes documenting jackpot payouts over three thousand dollars shall be retained for at least thirty days; and

(d) Commission staff may increase any of the times noted in this section by notifying the licensee.

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OTS-3737.1


NEW SECTION
WAC 230-40-830
Cashier's cage -- Requirements.

All cash, cash equivalents, and chips related to the operation of card games shall be closely controlled and records maintained documenting receipts and disbursements. Licensees shall maintain a cashier's function whose responsibility shall be to secure and account for all chips and monies in the card room portion of the premises. At a minimum the following restrictions and procedures apply:

(1) There shall be on or immediately adjacent to the gaming floor a physical structure known as the cashier's cage (cage) to house the cashiers and to serve as the central location for, at a minimum, the following:

(a) The custody of the cage inventory comprising currency, coin, patron checks, gaming chips, forms, documents and records normally associated with the operation of a cage;

(b) The approval of patron checks for the purpose of gaming;

(c) The receipt and distribution of gaming chips from the gaming table and the redemption of gaming chips from patrons. The purchase of gaming chips by patrons shall only occur at the gaming table; and

(d) Such other functions normally associated with the operation of a cage.

(2) The cage shall be designed, constructed and operated to provide maximum security and accountability for funds including, at a minimum, the following:

(a) An enclosed structure except for openings through which items such as gaming chips, checks, cash, records, and documents can be passed to service the public and gaming tables;

(b) Manually triggered silent alarm systems connected directly to the surveillance rooms of the closed circuit television system or an alarm monitoring agency;

(c) Access shall be through a locked door, which shall have closed circuit television coverage which is monitored by the surveillance department.

(3) Entry to the cage shall be limited to authorized personnel. The gaming operation department shall place on file with the accounting department the names of all persons authorized to enter the cage, those who possess the combination or the keys or who control the mechanism to open the locks securing the entrance to the cage, and those who possess the ability to operate the alarm systems.

(4) A log shall be maintained documenting all persons entering the cashier's cage. The log must contain the person's name, title, time entering and exiting, and date of entry.

(5) Licensees not offering house-banked card games shall not be required to meet the above requirements: Provided, That licensees shall maintain a system for securing and properly accounting for all gaming chips and monies.

[]

OTS-3738.1


NEW SECTION
WAC 230-40-833
Cashier's bank and minimum bankroll.

All card room licensees with house-banked card games or player-supported jackpots shall maintain sufficient funds to meet all cash out and prize payout requirements.

(1) All assets for which the cashiers are responsible shall be maintained on an imprest basis. This requires funds to be replenished on a regular basis by exactly the amount of expenditures from the cage less the amount of funds added. Expenditures shall be reviewed by a supervisor of the accounting department before replenishment: Provided, That licensees demonstrating the ability to control cage activity can request commission staff approval to operate on a float basis as an alternative procedure.

(2) The licensee shall have sufficient cash on hand to redeem all chips and payout all prizes: Provided, That payments of prizes may be paid by check as long as sufficient funds are available on deposit in accordance with WAC 230-12-072 and 230-12-073.

(3) Failure to maintain funds to cash in chips, pay prizes, or redeem gaming related checks shall be prima facie evidence of fraud.

[]

OTS-3739.1


NEW SECTION
WAC 230-40-835
Accounting controls for cashier's cage.

Licensees required to maintain a cashier's cage shall adhere to the following controls to ensure proper accountability for funds. The following restrictions and procedures apply to cashiers and the cage:

(1) Cashiers shall be responsible for at least the following functions:

(a) Receive cash, checks, and gaming chips from patrons for check consolidations, total or partial redemptions or substitutions;

(b) Receive gaming chips from patrons in exchange for cash;

(c) Receive traveler's checks and other cash equivalents (including money orders, certified checks, and cashier's checks) from patrons in exchange for currency or coin;

(d) Receive documentation with signatures thereon, required to be prepared for the effective segregation of functions in the cashier's cage;

(e) Receive from security department personnel, chips and coins removed from gaming tables in exchange for the issuance of a credit;

(f) Receive from security department members, requests for fills in exchange for the issuance of a fill slip and the disbursal of gaming chips;

(g) Receive cash or chips from the count room;

(h) At the end of each shift, the cashiers assigned to the outgoing shift shall count each cage inventory item and record on a cashier's count sheet the face value of each inventory item and the total of the opening and closing inventories. The total closing inventory shall be reconciled with the total opening inventory;

(i) Prepare the overall cage reconciliation and accounting records; and

(j) Perform such other functions as necessary to ensure proper accountability of funds and chips consistent with these standards.

(2) Signatures attesting to accuracy shall, at a minimum, be contained on the following:

(a) Cashier's count sheet; and

(b) Cage inventory countsheet, which includes the signatures of the cashiers assigned to the incoming and outgoing shifts.

(3) At the conclusion of the daily gaming activity, copies of the cashier's count sheet, cage inventory count sheet and related documentation shall be forwarded to the accounting department for agreement of opening and closing inventories, and agreement of amounts thereon to other forms, records and documentation for recording of transactions.

[]

OTS-3740.1


NEW SECTION
WAC 230-40-840
Drop boxes -- Requirements.

Licensees required to utilize drop boxes shall ensure they are constructed and controlled in a manner to provide security of contents. All card rooms operating house-banked card games or collecting fees utilizing the drop box as a collection method shall meet the following requirements and procedures:

(1) Each gaming table shall have attached to it a metal container known as a "drop box" into which all cash, duplicate fill slips and credit slips, request for fills and request for credits, and table inventory forms shall be deposited.

(2) Each drop box shall have the following:

(a) A lock securing the contents. The key to this lock shall be maintained and controlled by the accounting department;

(b) A separate lock securing the drop box to the gaming table. This lock shall be keyed differently from the lock securing the contents of the drop box. The key utilized to unlock this lock shall be maintained and controlled by the security department;

(c) An opening through which currency, coins, chips, forms, records and documents can be inserted into the drop box;

(d) Permanently imprinted or impressed thereon and clearly visible, a number corresponding to a permanent number on the gaming table to which it is attached and a marking to indicate the game. The shift shall also be included if drop boxes are removed from tables more than once during an operating day: Provided, That emergency drop boxes may be maintained without such number or marking, if the word "emergency" is permanently imprinted or impressed thereon, and when put into use, are temporarily marked with the number of the gaming table and identification of the game and shift.

(3) All drop boxes removed from the gaming tables shall be transported directly to the count room and secured by one security department member and one employee of the gaming operation department: Provided, That licensees not required to maintain a count room shall transport drop boxes directly to the count area using the supervisor or the supervisor's designee for the transport.

(4) All drop boxes not attached to a gaming table, shall be stored in the count room in an enclosed storage cabinet or trolley and secured in such cabinet or trolley by two separately keyed locks. The key to one lock shall be maintained and controlled by the security department and the key to the other lock shall be maintained and controlled by the gaming operation department.

(5) Drop boxes, when not in use during a shift, may be stored on the gaming tables if licensed security personnel are present in the gaming area at all times drop boxes are stored on the gaming tables and the entire area is covered by taped surveillance. If adequate security is not provided during this time, the drop boxes shall be stored as required in subsection (4) of this section.

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OTS-3741.1


NEW SECTION
WAC 230-40-845
Procedures for exchange of checks submitted by gaming patrons at cashier's cage.

In addition to the requirements set forth in WAC 230-12-053, checks submitted to the cashier's cage are subject to the following restrictions and procedures:

(1) All checks sought to be exchanged at the cashiers' cage shall be presented directly to the cashier who shall:

(a) Restrictively endorse the check "for deposit only" to the licensee's bank account;

(b) Initial the check;

(c) Date and time stamp the check;

(d) Verify that the patron is not listed on the returned check log;

(e) Immediately exchange the check for currency and coin in an amount equal to the amount for which the check is drawn less any applicable fees; and

(f) Forward all patron checks to the main bank cashier.

(2) Prior to acceptance of a traveler's check from a patron, the cashier shall:

(a) Require the patron to countersign the traveler's check in his or her presence;

(b) Compare the countersignature with the original signature on the traveler's check;

(c) Examine the traveler's check for any other signs of tampering, forgery or alteration; and

(d) Perform any other procedures that the issuer of the traveler's check requires in order to indemnify the acceptor against loss.

(3) Prior to the acceptance of any check from a patron, the cashier shall examine that patron's identification to confirm the patron's identity.

(4) All checks received shall be deposited in the licensee's bank account within two banking days after receipt: Provided, That checks deposited within two days to an armored car service shall meet this requirement.

(5) All checks dishonored by a bank (returned checks) shall be returned directly to, and controlled by, accounting department employees: Provided, That if a collection agency is used which maintains dishonored checks, a photocopy of the check shall be sufficient.

(6) Records of all returned checks shall be maintained by accounting department employees and shall be available to cashiers. Such records shall include, at a minimum, the following:

(a) The date of the check;

(b) The name and address of the drawer of the check;

(c) The amount of the check;

(d) The date(s) the check was dishonored;

(e) The date(s) and amount(s) of any collections received on the check after being returned by a bank.

(7) If a check is dishonored, the name of the person who submitted the check shall be kept in a log, and available to the cashier. Such person shall be prohibited from submitting additional checks until the amount owed is paid in full: Provided, That a check dishonored by a bank may be immediately redeposited if there is sufficient reason to believe the check will be honored the second time.

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OTS-3742.1


NEW SECTION
WAC 230-40-850
Procedures for purchasing gaming chips.

The purchase of gaming chips by patrons shall be conducted in a manner to ensure proper accountability of chips and cash. The following restrictions and procedures apply:

(1) Gaming chips shall only be purchased at the gaming table;

(2) The cash shall be spread on the top of the gaming table by the dealer in a manner that allows the patron, floor supervisor, and surveillance a full view of the transaction;

(3) The amount of cash shall be announced by the dealer accepting it in a tone of voice to be heard by the patron who presented the cash and the floor supervisor specifically assigned to the gaming table. All cash changes of one hundred dollars or more shall be verified by the supervisor;

(4) Prior to giving gaming chips to the patron, the dealer shall prove each denomination of chips in a manner that discloses the number of chips to the patron, floor supervisor, and surveillance. Procedures for proving chips shall be included in the licensee's approved system of internal controls; and

(5) Immediately after gaming chips, equivalent to the cash amount paid by the patron, have been given to the patron, the cash shall be taken from the top of the gaming table and placed by the dealer into the drop box attached to the gaming table.

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OTS-3743.1


NEW SECTION
WAC 230-40-855
Acceptance of tips from patrons for house-banked activities.

Licensees may allow selected employees to accept tips from patrons. If allowed, tips shall be controlled in a manner to ensure they are only received by authorized persons, properly accounted for, and maintained separate from all other gaming funds. The following restrictions and procedures apply:

(1) No employee directly concerned with management, supervision, accounting, security, or surveillance shall solicit or accept any tip from any player or patron: Provided, That cage cashiers shall be allowed to accept tips.

(2) Each licensee shall establish procedures necessary to ensure that the acceptance of tips by dealers is observed by the floor supervisor and surveillance. Procedures shall include an overt display of tips received, such as tapping the table with the tip prior to placing it in the tip container.

(3) Tips to the cashier shall be deposited directly into the tip container by the patron. Cashier tip containers shall be located outside the cage enclosure.

(4) Tips received shall be retained by employees or pooled among employees in such manner as determined by the licensee.

(5) Licensees shall establish and implement procedures for the proper accounting of tips received by authorized card room employees. The procedures shall be fully documented in the licensee's internal controls and shall describe in detail any methods used to allocate tips. Accounting and recording of tip income shall be in sufficient detail to meet federal income tax requirements.

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OTS-3744.1


NEW SECTION
WAC 230-40-860
Table inventories and procedures for opening tables for house-banked card games.

Procedures shall be established to ensure proper accountability of gaming chips and coins stored at gaming tables and for beginning play at such tables. The following restrictions and procedures apply:

(1) Whenever a gaming table is opened for gaming, operations shall commence with an amount of gaming chips and coins to be known as the "table inventory" and the licensee shall not cause or permit gaming chips or coins to be added to or removed from such table inventory during the gaming day except:

(a) In exchange for cash from patrons;

(b) In payment of winning wagers and collection of losing wagers made at such gaming table;

(c) In exchange for gaming chips received from a patron having an equal aggregate face value; and

(d) In conformity with procedures set forth in WAC 230-40-865 and 230-40-870.

(2) Each table inventory and the table inventory slip prepared in conformity with the procedures set forth in WAC 230-40-875 shall be stored during nongaming hours in a separate locked, clear container which shall be clearly marked on the outside with the game and the gaming table number to which it corresponds. The information on the table inventory slip shall be visible from the outside of the container. All containers shall be stored in the cashier's cage during nongaming hours: Provided, That containers may be secured at the gaming table if under taped surveillance.

(3) The keys to table inventory containers shall be maintained and controlled by the gaming operation department in a secure place and shall at no time be made accessible to any cashier's cage personnel or to any person responsible for transporting such table inventories to or from the gaming tables.

(4) Licensees shall abide by the following procedures when opening gaming tables for play:

(a) The locked container securing the table inventory and the table inventory slip shall be unlocked by the gaming operation supervisor assigned to such table;

(b) A dealer assigned to the gaming table shall prove the contents of the container in the presence of the gaming operation supervisor assigned to such table and shall compare the count to the "opener," as defined in WAC 230-40-875, removed from the container. The procedures used to prove the chip and coin inventory shall be set forth in the licensee's internal controls;

(c) Signatures attesting to the accuracy of the information on the opener shall be placed on such "opener" by the dealer assigned to the table and the gaming operation supervisor that observed the dealer count the contents of the container;

(d) Any discrepancy between the amount of gaming chips and coins counted and the amount of the gaming chips and coins recorded on the "opener," shall be immediately reported to the gaming operation manager, assistant gaming operation manager, or gaming operation shift manager in charge at such time. The manager in charge shall complete the notification of error slip, which will be verified by security and transported to accounting or the cashier's cage. Accounting will maintain a copy in the log containing the notification of error slips. The licensee shall notify commission staff within twenty-four hours of errors of two hundred dollars or more or if there is a pattern relating to regular shortages;

(e) After the count of the contents of the container and the signing of the "opener," such slip shall be immediately deposited in the drop box attached to the gaming table by the dealer.

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OTS-3745.1


NEW SECTION
WAC 230-40-865
Procedure for distributing gaming chips and coins to house-banked gaming tables -- Requests and fills.

Gaming chips and coins shall only be distributed to gaming tables with adequate security and in a manner that ensures proper control and accountability. The following restrictions and procedures apply:

(1) Each "request for fill" and "fill slip" shall be serially prenumbered forms, which provide an original and duplicate copies as necessary: Provided, That the director may authorize use of a computer based accounting system which includes a nonrepeating sequential numbering system that is consistent with the controls and safeguards of the manual system. These forms shall be controlled in the following manner:

(a) Each series of requests for fill and fill slips received by a licensee shall be controlled and accounted for separately;

(b) Request for fills shall be secured in such a manner that only a gaming operations supervisor has access;

(c) Fill slips shall be secured by the cashier's cage;

(d) These forms shall be used in sequential order and all forms accounted for; and

(e) The preparer shall void forms that have errors by marking "VOID" on both the original and duplicate copies and sign the form.

(2) A "request for fill" shall be prepared by the gaming operation supervisor to authorize the cage to prepare a "fill slip" for the distribution of chips and coins to gaming tables. The original and duplicate of the request for fill shall include the following entries:

(a) The date, time, and shift of preparation;

(b) The denomination of gaming chips or coins to be distributed to the gaming tables;

(c) The total amount of each denomination of gaming chips or coins to be distributed to the gaming tables;

(d) The game and table number to which the gaming chips or coins are to be distributed;

(e) The signature of the gaming operation supervisor; and

(f) The signature of the security department employee that distributed the chips and coins.

(3) After preparation of the request for fill, the original of such request shall be transported directly to the cashier's cage by security.

(4) The duplicate copy of the request for fill shall be placed by the dealer or floor supervisor in public view on the gaming table to which the gaming chips or coins are to be received. Such duplicate copy shall not be removed until the chips and coins are received, at which time the request for fill and fill slips are deposited in the drop box.

(5) A fill slip shall be prepared by a cashier whenever gaming chips or coins are distributed to the gaming tables from the cashier's cage. The following procedures and requirements shall be observed with regard to fill slips:

(a) Each series of fill slips shall be in triplicate form to be kept in a locked dispenser that will permit an individual fill slip in the series and its copies to be written upon simultaneously while still located in the dispenser, and that will discharge the original and duplicate while the triplicate remains in a continuous, unbroken form in the dispenser: Provided, That if a computer system is used, which includes a nonrepeating sequential numbering system, the controls and safeguards of the manual system must be present; and

(b) Access to the triplicate copy of the form shall be maintained and controlled at all times by an accounting department employee responsible for controlling and accounting for the unused supply of fill slips, placing fill slips in the dispensers, and removing from the dispensers, each day, the triplicate copies remaining therein.

(6) On the original, duplicate, and triplicate copies of the fill slip, the preparer shall record, at a minimum, the following information:

(a) The denomination of the gaming chips or coins being distributed;

(b) The total amount of the gaming chips or coins being distributed;

(c) The total amount of all denominations of gaming chips or coins being distributed;

(d) The game and table number to which the gaming chips or coins are being distributed;

(e) The date and shift during which the distribution of gaming chips or coins occurs; and

(f) The signature of the preparer.

(7) Upon preparation, the time of preparation of the fill slip shall be recorded, at a minimum, on the original and the duplicate.

(8) All gaming chips or coins distributed to the gaming tables from the cashier's cage shall be transported directly by a security department employee. This employee shall verify the request for fill to the amount of the fill slip and sign the original of the request for fill, which is maintained at the cashier's cage, before transporting the gaming chips or coins and the original and duplicate of the fill slip for signature.

(9) Signatures attesting to the accuracy of the information contained on the original and duplicate of the fill slips shall, at a minimum, be those of the following personnel at the following times:

(a) The cashier upon preparation;

(b) The security department employee transporting the gaming chips or coins to the gaming table upon receipt from the cashier of gaming chips or coins;

(c) The dealer assigned to the gaming table upon receipt; and

(d) The gaming operation supervisor assigned to the gaming table upon receipt of the gaming chips or coins at such table.

(10) Upon meeting the signature requirements, the security department employee that transported the gaming chips or coins and the original and duplicate copies of the fill slip to the table, shall observe the following:

(a) The dealer shall immediately place the duplicate fill slip and duplicate request for fill in the drop box attached to the gaming table to which the gaming chips or coins were transported; and

(b) The security department employee shall then return the original fill slip to the cashier's cage where the original fill slip and request for fill shall be maintained together and controlled by cage employees.

(11) The original and duplicate "VOID" fill slips, the original request for fill, and the original fill slip shall be forwarded as follows:

(a) The count team, as described in WAC 230-40-885(2), for agreement with the duplicate copy of the fill slip and duplicate copy of the request for fill removed from the drop box after which the original and duplicate copy of the request for fill and the original and duplicate copy of the fill slip shall be forwarded to the accounting department for agreement, on a daily basis, with the triplicate; or

(b) The accounting department for agreement, on a daily basis, with the duplicate fill slip and duplicate copy of the request for fill removed from the drop box and the triplicate.

(12) Transfers of gaming chips from one gaming table to another gaming table is prohibited. All transfers of gaming chips shall be to the cashier's cage.

[]

OTS-3746.1


NEW SECTION
WAC 230-40-870
Procedure for removing gaming chips and coins from house-banked gaming tables -- Requests and credits.

All transfers of gaming chips and coins shall be closely controlled and documented in a manner that ensures accountability. Gaming chips and coins shall only be removed from gaming tables with adequate security. The following restrictions and procedures apply:

(1) Each "request for credit" and "credit slip" shall be serially prenumbered forms, which provide an original and duplicate copies as necessary: Provided, That the director may authorize use of a computer based accounting system which includes a nonrepeating sequential numbering system that is consistent with the controls and safeguards of the manual system. These forms shall be controlled in the following manner:

(a) Each series of requests for credit and credit slips received by a licensee shall be controlled and accounted for separately;

(b) Request for credits shall be secured in such a manner that only a gaming operations supervisor has access;

(c) Credit slips shall be secured by the cashier's cage;

(d) These forms shall be used in sequential order and all forms accounted for; and

(e) The preparer shall void forms that have errors by marking "VOID" on both the original and duplicate copies and sign the form.

(2) A "request for credit" shall be prepared by the gaming operation supervisor to authorize the cage to prepare a "credit slip" for the removal of gaming chips and coins to the cashier's cage. The original and duplicate of the request for credit shall include the following entries:

(a) The date, time and shift of preparation;

(b) The denomination of gaming chips or coins to be removed from the gaming table;

(c) The total amount of each denomination of gaming chips or coins to be removed from the gaming table;

(d) The game and table number from which the gaming chips or coins are to be removed; and

(e) The signature of the gaming operation supervisor and dealer assigned to the gaming table from which gaming chips or coins are to be removed.

(3) Immediately upon preparation of a request for credit and transfer of gaming chips or coins to a security department employee, a gaming operation supervisor shall obtain on the duplicate copy of the request for credit the signature of the security department member to whom the gaming chips and coins were transferred. The dealer shall place the duplicate copy in public view on the gaming table from which the gaming chips or coins were removed. Such request for credit shall not be removed until a credit slip is received from the cashier's cage at which time the request for credit and credit slip are deposited in the drop box.

(4) The original of the request for credit and the gaming chips or coins removed from the gaming table shall be transported directly to the cashier's cage by the security department employee.

(5) A credit slip shall be prepared by the cashier whenever gaming chips or coins are removed from the gaming tables to the cashier's cage. The following procedures and requirements shall be observed with regard to credit slips:

(a) Each series of credit slips shall be a three-part form and shall be inserted in a locked dispenser that will permit an individual slip in the series and its copies to be written upon simultaneously while still locked in the dispenser, and that will discharge the original and duplicate while the triplicate remains in a continuous, unbroken form in the dispenser: Provided, That if a computer system is used, which includes a nonrepeating sequential numbering system, the controls and safeguards of the manual system must be present; and

(b) Access to the triplicate copy shall be maintained and controlled at all times by an accounting department employee responsible for controlling and accounting for the unused supply of credit slips, placing credit slips in the dispensers, and removing from the dispensers, each day, the triplicates remaining therein.

(6) On the original, duplicate and triplicate copies of a credit slip, the preparer shall record, at a minimum, the following information:

(a) The denomination of the gaming chips or coins removed from the gaming table to the cashier's cage;

(b) The total amount of each denomination of gaming chips or coins removed from the gaming table to the cashier's cage;

(c) The total amount of all denominations of gaming chips or coins removed from the gaming table to the cashier's cage;

(d) The game and table number from which the gaming chips or coins were removed;

(e) The date and shift during which the removal of gaming chips or coins occurs; and

(f) The signature of the preparer.

(7) Upon preparation, the time of preparation of the credit slip shall be recorded, at a minimum, on the original and duplicate copy.

(8) Signatures attesting to the accuracy of the information contained on the original and the duplicate copy of a credit slip shall be, at a minimum, the following personnel at the following times:

(a) The cage cashier upon preparation;

(b) The security department employee transporting the gaming chips or coins to the cashier's cage upon presentation to the cashier;

(c) The dealer assigned to the gaming table upon receipt at such table from the security department employee; and

(d) The gaming operation supervisor assigned to the gaming table upon receipt at such table.

(9) Upon meeting the signature requirements, the security department employee transporting the original and duplicate copies of the credit slip to the gaming table, shall observe the following:

(a) The dealer shall immediately place the duplicate copies of the credit slip and request for credit in the drop box attached to the gaming table from which the gaming chips or coins are removed; and

(b) The security department employee shall expeditiously return the original credit slip to the cashier's cage where the original of the credit slip and request for credit shall be maintained together, and controlled by cage employees.

(10) The original and duplicate copies of "VOID" credit slips, and the original request for credit and credit slip shall be forwarded to:

(a) The count team, as described in WAC 230-40-885(2), for agreement with the duplicate credit slip and the duplicate request for credit removed from the drop box, after which the request for credit and the original and duplicate credit slip shall be forwarded to the accounting department for agreement, on a daily basis, with the triplicate; or

(b) The accounting department for agreement, on a daily basis, with the duplicate copies of the credit slip and request for credit removed from the drop box and the triplicate.

[]

OTS-3747.1


NEW SECTION
WAC 230-40-875
Procedures for closing house-banked gaming tables.

Procedures shall be followed for closing gaming tables that ensure proper accountability of gaming chips and coins. The following restrictions and procedures apply:

(1) Whenever the gaming activity at each gaming table is concluded for the day, the gaming chips and coins shall be counted by the dealer assigned to the gaming table and observed by a gaming operation supervisor. The entire count and closure process shall be monitored and taped by the surveillance department.

(2) The gaming chips and coins counted shall be recorded on a table inventory slip by the gaming operation supervisor assigned to the gaming table.

(3) Table inventory slips shall be three-part serially prenumbered forms and on the original of the slip (closer), the duplicate of the slip (opener), and on the triplicate, which is maintained and controlled by security, the gaming operation supervisor shall record the following:

(a) The date and identification of the shift ended;

(b) The game and table number;

(c) The total value of each denomination of gaming chips and coins remaining at the tables; and

(d) The total value of all denominations of gaming chips and coins remaining at the gaming tables.

(4) Signatures attesting to the accuracy of the information recorded on the table inventory slips at the time of closing the gaming tables shall be of the dealer and the gaming operation supervisor assigned to the gaming table who observed the dealer count the contents of the table inventory.

(5) Upon meeting the signature requirements:

(a) The closer shall be deposited in a drop box attached to the gaming table immediately prior to the closing of the table;

(b) The opener and the gaming chips and coins remaining at the table shall be placed in a clear container provided for that purpose after which the container shall be locked; and

(c) The triplicate copy of the table inventory slip shall be forwarded to the accounting department by a security department employee.

(6) At the end of each gaming day, if the locked containers are transported to the cashier's cage, a cage cashier shall determine that all locked containers have been returned to the cage and adequately secured or, if the locked containers are secured to the gaming table, a gaming operation supervisor shall account for all the locked containers.

(7) In the event drop boxes are removed from gaming tables at other than the close of the gaming day, they shall be removed at a shift change. A table inventory slip shall be prepared as required above with the incoming and outgoing supervisor verifying the inventory and signing.

[]

OTS-3748.1


NEW SECTION
WAC 230-40-880
Count room -- Requirements.

All card room licensees offering house-banked card games or utilizing drop boxes for the collection of game fees or wagers shall be required to maintain a secured area for the counting of gaming chips, coin, and currency. The following requirements, restrictions, and procedures apply:

(1) There shall be a room specifically designated for counting the contents of drop boxes, which shall be known as the "count room": Provided, That licensees not offering house-banked card games shall not be required to maintain a count room for counting the contents of drop boxes if they have another secure location and they meet all other commission requirements for surveillance and counting procedures.

(2) The count room shall be a fully enclosed room with only one entry designed and constructed to provide maximum security for the materials housed therein and for the activities conducted therein, to include at a minimum, the following:

(a) A door equipped with at least one lock securing the interior of the count room, the key to which shall be maintained and controlled by the gaming operation department or an employee of the security department;

(b) The gaming operation department or security department shall establish a sign-out procedure for all keys removed from the security department; and

(c) An alarm device connected to the entrance of the count room in such a manner as to cause a signaling to the surveillance employees of the closed circuit television system whenever the door to the count room is opened.

(3) The following shall be located within the count room:

(a) A table constructed of clear glass or similar material with a base that does not obstruct viewing for the emptying, counting, and recording of the contents of the drop boxes which shall be known as the "count";

(b) Closed circuit television cameras and microphones that are capable of, but not limited to, the following:

(i) Effective and detailed video and audio monitoring of the entire count process; and

(ii) Effective, detailed video-monitoring of the count room and all contents, including storage cabinets or trolleys used to store drop boxes.

(c) The licensee shall post a sign within the count room or at the entrance disclosing that audio recordings within the count room are being conducted at all times.

(4) A count room sign-in log shall be maintained by the licensee as prescribed by the commission.

[]

OTS-3749.1


NEW SECTION
WAC 230-40-885
Counting and recording contents of drop boxes -- Procedures.

The contents of drop boxes shall be counted and recorded in a manner that ensures the proper accountability of all gaming chips, coins, and currency. The following restrictions and procedures apply:

(1) The gaming operation department shall notify the surveillance department whenever the contents of drop boxes removed from gaming tables are to be counted and recorded, which, at a minimum, shall be once each gaming day.

(2) The opening, counting and recording of the contents of drop boxes shall be performed in the presence of and by those employees assigned by the gaming operation department for the conduct of the count. The count team must consist of three employees who shall not be in a position to perpetrate or conceal errors or irregularities in the normal course of his or her duties. Anyone both recording transactions and having access to the relevant assets is in a position to perpetrate errors or irregularities.

(3) Immediately prior to the opening of the drop boxes, the doors to the count room shall be securely locked and except as otherwise authorized, no person shall be permitted to enter or leave the count room, except during a normal work break or in an emergency, until the entire counting, recording, and verification process is completed.

(4) Immediately prior to the commencement of the count, one count team member shall notify the person assigned to the closed circuit television surveillance room in the establishment that the count is about to begin, after which such person shall make a video and audio recording of the entire counting process.

(5) Contents of drop boxes shall not be mixed prior to counting and recording of each drop box. Procedures and requirements for conducting the count shall be the following:

(a) As each drop box is placed on the count table, one count team member shall announce, in a tone of voice to be heard by all persons present and to be recorded by the audio recording device, the game, table number, and shift marked thereon;

(b) The contents of each drop box shall be emptied and counted separately on the count table;

(c) Immediately after the contents of a drop box are emptied onto the count table, the inside of the drop box shall be held up to the full view of a closed circuit television camera, and shall be shown to at least one other count team member to confirm that all contents of the drop box have been removed, after which the drop box shall be locked and placed in the storage area for drop boxes;

(d) The contents of each drop box shall be segregated by a count team member into separate stacks on the count table by denominations of coin and currency and by type of form, record or document;

(e) Each denomination of coin and currency shall be counted separately by at least two count team members who shall place individual bills and coins of the same denomination on the count table in full view of the closed circuit television cameras, and such count shall be observed and the accuracy confirmed orally or in writing, by at least one other count team member;

(f) As the contents of each drop box is counted, one count team member shall record or verify on a master game report, by game, table number, and shift, the following information:

(i) The total amount of currency and coin counted, also known as the "drop";

(ii) The amount of the opener;

(iii) The amount of the closer;

(iv) The serial number and amount of each fill slip;

(v) The total amount of all fill slips;

(vi) The serial number and amount of each credit slip;

(vii) The total amount of all credit slips; and

(viii) The game win or loss.

(g) After the contents of each drop box have been counted and recorded, one member of the count team shall record by game and shift, on the master game report, the total amounts of currency and coin, table inventory slips, fill slips and credit slips counted, and win or loss, together with such additional information as may be required on the master game report by the licensee.

(h) Notwithstanding the requirements of (f) and (g) of this subsection, if the licensee's system of accounting and internal controls provides for the recording on the master game report of fill slips, credit slips, and table inventory slips by cage cashiers prior to the commencement of the count, a count team member shall compare the serial numbers and totals of the amounts recorded thereon to the fill slips, credit slips, and table inventory slips removed from the drop boxes;

(i) Notwithstanding the requirements of (f) and (g) of this subsection, if the licensee's system of accounting and internal controls provides for the count team functions to be comprised only of counting and recording currency, coin, and credits, accounting department employees shall perform all other counting, recording and comparing duties herein; and

(j) After completion and verification of the master game report, each count team member shall sign the report attesting to the accuracy of the information recorded thereon.

(6) Procedures and requirements at the conclusion of the count for each gaming shift shall be the following:

(a) All cash removed from each drop box after the initial count shall be presented in the count room by a count team member to a cashier who, prior to having access to the information recorded on the master game report and in the presence of the count team, shall recount, either manually or mechanically, the cash received;

(b) The top copy of the master game report, after signing, and the request for fills, the fill slips, the request for credits, the credit slips, and the table inventory slips removed from drop boxes, shall be transported directly to the accounting department and shall not be available to any cashier's cage personnel; and

(c) If the licensee's system of accounting and internal controls does not provide for the forwarding from the cashier's cage of the duplicate of the fill slips, credit slips, request for credits, request for fills, such documents recorded or to be recorded on the master game report shall be transported from the count room directly to the accounting department.

(7) The originals and copies of the master game report, request for fills, fill slips, request for credits, credit slips and table inventory slips shall on a daily basis, in the accounting department be:

(a) Compared for agreement with each other, on a test basis, by persons with no recording responsibilities and, if applicable, to triplicates or stored data;

(b) Reviewed for the appropriate number and propriety of signatures on a test basis;

(c) Accounted for by series numbers, if applicable;

(d) Tested for proper calculation, summarization, and recording;

(e) Subsequently recorded; and

(f) Maintained and controlled by the accounting department.

(8) Card rooms not operating house-banked card games shall not have to meet the requirements above: Provided, That the following requirements shall be met:

(a) The count shall occur at a specific time that has been reported to commission staff;

(b) All fees shall be counted at least once each operating day;

(c) The count shall be made by at least two licensed employees of the card room who shall record the amount on the count slip for each drop box;

(d) The surveillance requirements of WAC 230-40-825 shall be met; and

(e) An entry shall be made in the daily card room record for each table and each type of fee collected at a table. Count slips for each table shall be retained with the daily records.

[]

OTS-3750.1


NEW SECTION
WAC 230-40-890
Signatures -- Requirements.

Each transfer of cash, coins, or chips shall be documented and verified by signatures of individuals responsible for applicable records. A record of authorized signatures shall be maintained for all employees of a house-banked card room authorized to approve transfers of cash, coin, or chips. The following restrictions and operating procedures apply to licensees conducting house-banked card games:

(1) Signatures shall:

(a) Be, at a minimum, the signer's first initial and last name, i.e., "B. Smith";

(b) Be immediately adjacent to, or above, the clearly printed or preprinted title of the signer and his or her employee number; and

(c) Signify that the signer has prepared forms, records, and documents, and/or is authorized to a sufficient extent to attest to the accuracy of the information recorded thereon, in conformity with these standards and the licensee's system of accounting and internal control.

(2) The licensee shall ensure that signature cards are completed for each person who signs or initials forms, records and documents, and shall include samples of signatures and initials of signers. Such signature records shall be prepared in the presence of a member of the accounting department who shall verify the employee's identity by review of a picture identification card. Completed cards shall be maintained in a dated signature card file, sorted by department and listed alphabetically by name. The signature records shall be adjusted on a timely basis to reflect changes of personnel, and must be retained for a period of at least one year after employment terminates.

(3) Signature cards shall be securely stored in the accounting department. A copy of each signature card shall be maintained in the cashier's cage and be used by cage personnel to verify applicable signatures.

[]

OTS-3751.2


NEW SECTION
WAC 230-40-895
Key control requirements and procedures.

All activities related to the operation of house-banked card games shall be closely monitored and controlled. The following restrictions and operating procedures shall apply for control of card room keys to restrict access to areas by unauthorized card room employees.

(1) Each licensee shall install and maintain key control boxes that meet at least the specifications set forth below:

(a) Constructed of metal with a minimum of one keylock mechanism;

(b) Be attached to a permanent structure without visibility of hardware used to attach the key box;

(c) Be tamper proof;

(d) Have keys stored therein to be easily identifiable, labeled, and displayed individually in numeric or alphabetic order;

(e) The physical location of key control boxes may be determined by each licensee. The location shall not permit an individual to gain access to a restricted area that he/she would otherwise not be allowed to enter. If key boxes are located in areas where unauthorized individuals have access, that person may only have custody of the key and open the key box in the presence of the key custodian; or while under camera coverage.

(2) Individual key control boxes shall be maintained by at least three departments including gaming operations, accounting, and security/surveillance. Access to key control boxes shall be limited to the licensed card room employee(s) responsible for overall supervision or management of the operation for which the box is maintained. Keys shall be controlled in the following manner:

(a) Keys included in the key control box maintained by the gaming operations department shall include:

(i) Key to each pit podium;

(ii) Key(s) to drawers and other locking cabinets located in each pit podium;

(iii) Key to remove the clear plastic cover from the container used to store gaming chips and secured to the gaming tables;

(iv) Key to the second lock on the enclosed storage cabinet or trolley used to store or transport all drop boxes removed from the gaming tables;

(v) Key to all upper tier and lower tier jackpot payout boxes included with authorized card games;

(vi) Key to all electrical control boxes used to maintain authorized card games;

(vii) Other keys included in the licensee's internal controls and approved by commission staff.

(b) Keys included in the key control box maintained by security/surveillance shall include:

(i) Key to the lock used to secure the interior of the count room;

(ii) Key utilized to unlock the drop boxes from the gaming tables;

(iii) Key to the first lock on the enclosed storage cabinet or trolley used to store or transport all drop boxes removed from the gaming tables to the count room;

(iv) Key to the storage cabinet(s) or other secure facility used to store the card inventory including decks which have not been placed into play and decks removed from play and waiting to be destroyed;

(v) Key to the room used for clandestine surveillance;

(vi) Key to the storage cabinet(s) or locker(s) used to maintain tapes of evidentiary value or tapes documenting details of jackpot payouts;

(vii) Key to main entry or access door of the card room;

(viii) Other keys included in the licensee's internal controls and approved by commission staff.

(c) Keys included in the key control box maintained by the accounting department shall include:

(i) Key to the lock securing the contents of the drop boxes;

(ii) Key to the rear of the locked dispenser used to store the triplicate of the fill/credit slips in a continuous, unbroken form;

(iii) Key to the door to the cashier's cage;

(iv) Key to reset the lock to the drop boxes;

(v) Keys included in the licensee's internal controls and approved by commission staff;

(vi) Keys maintained by the cashier's cage including:

(A) Key(s) to each cashier's window drawer;

(B) Key to the chip drawer or fill bank;

(C) Key to the vault or safe;

(D) Key to the door to the cashier's cage;

(E) Key to the front of the locked dispenser used to store the triplicate of the fill/credit slips in continuous, unbroken form;

(F) Other keys included in the licensee's internal controls and approved by commission staff;

(G) Key(s) to the dealer tip boxes.

(d) A master key control box may be maintained with access strictly limited to the owner(s) or chief operating officer responsible for exercising the overall management or authority over all the operations of the card room and may include:

(i) All spare or extra keys for the areas noted above.

(ii) Other keys included in the licensee's internal controls and approved by commission staff.

(3) Each licensee shall maintain for each key control box, a key control log used to record the issuance of and return of all keys used to control the restricted access areas by card room employees identified. The key control log shall be maintained in the format prescribed by the commission.

(4) Keys to secure the contents of each key control box required above shall be strictly controlled as follows.

(a) There shall be one key for each key control box which shall be controlled by the manager of the department for which the key control box is designated. This key shall be distributed to the manager or supervisor in charge and maintained in their possession when gaming is being conducted.

(b) Keys to each key control box will be maintained in a secure manner as approved by commission staff and documented in the licensee's written internal controls.

(c) All spare or duplicate keys to the key control boxes identified above will be maintained in the master key control box and be controlled by the owner(s).

(5) Licensees may utilize electronic key control systems, if reviewed and approved in writing by the director or the director's designee.

[]

OTS-3752.2


NEW SECTION
WAC 230-40-897
Card game promotions -- Procedures -- Restrictions.

All promotions or schemes which are directly associated with card games or which affect the internal controls of the gaming operation must be submitted and approved by commission staff prior to implementation. The following procedures and restrictions apply:

(1) All players must have an equal opportunity to participate;

(2) The value of promotional items cannot exceed fifty dollars per person;

(3) Only one promotion may be used for each game at one time; and

(4) Detailed records must be maintained ensuring accountability, including any coupons redeemed.

[]

OTS-3753.1


NEW SECTION
WAC 230-40-550
Incompatible functions defined.

Incompatible functions for accounting and internal control purposes are functions, duties, or responsibilities that place any person or department in a position to both perpetrate and conceal errors or irregularities in the normal course of his or her duties. Anyone both recording transactions and having access to the relevant assets is in a position to perpetrate errors or irregularities. For example, an employee that writes checks should not reconcile the bank account; or an employee that transports funds should not have access to keys for locks securing such funds or to surveillance tapes recording the transaction.

[]

OTS-3754.1


NEW SECTION
WAC 230-40-552
Cash equivalent defined.

Cash equivalent is a treasury check, personal check, traveler's check, wire transfer of funds, money order, certified check, cashier's check, a check drawn on the licensee's account payable to the patron or to the licensee, or a voucher recording cash drawn against a credit card or debit card.

[]

OTS-3755.1


NEW SECTION
WAC 230-40-554
Chief executive officer or chief operations officer defined.

The chief executive officer or chief operations officer is the executive who has been designated by the owner, partners, or board of directors as the individual with overall responsibility for the business licensed to conduct card games.

[]

OTS-3756.1


NEW SECTION
WAC 230-40-556
Gaming operations department manager defined.

A gaming operations department manager is a licensed card room employee who has been designated by the chief executive officer or chief operating officer as responsible for management of all card room operations.

[]

OTS-3757.1


NEW SECTION
WAC 230-40-558
Shift manager defined.

A shift manager is a licensed card room employee who shall be responsible for all card room operations during a given shift. The shift manager reports to the gaming operations department manager and shall be the direct supervisor of the floor supervisor.

[]

OTS-3758.1


NEW SECTION
WAC 230-40-560
Floor supervisor defined.

A floor supervisor is a licensed card room employee who shall be responsible for directly supervising a limited number of card games and the dealers assigned to those games within a designated area known as the "pit."

[]

OTS-3759.1


NEW SECTION
WAC 230-40-562
Dealer defined.

A dealer is a licensed card room employee who is responsible for conducting card games and deals cards, collects and pays off players' bets, and collects fees. The dealer shall also be responsible for signing forms as required.

[]

OTS-3720.1


NEW SECTION
WAC 230-02-109
Net win defined.

"Net win" means gross wagers received by a licensee from the operation of house-banked card games or fund-raising events, less the amount paid to players for winning wagers, accrual of prizes for progressive jackpot contests, and repayment of amounts used to seed guaranteed progressive jackpot prizes.

[]

OTS-2911.4


AMENDATORY SECTION(Amending Order 228, filed 10/15/91, effective 11/15/91)

WAC 230-02-110
Gross gambling receipts defined.

"Gross gambling receipts" means the monetary value ((that would be)), stated in U.S. currency, due to any operator of a gambling activity for ((any chance taken, for any table fees for card playing, other fees for participation, or rent and lease fees for amusement games received by commercial amusement game operations, as evidenced by required records)) purchase of a chance to play a punch board or pull-tab series; purchase of a chance to enter a raffle; fees or purchase of cards to participate in bingo games; fees for participation in an amusement game, including rent or lease payments paid to licensees or franchisers for allowing operation of an amusement game on their premises; and any fee to participate in, or net win from, any card games or fund-raising events as defined in WAC 230-02-109.      The value shall be ((stated in U.S. currency,)) before any deductions for prizes or ((any)) other expenses. ((In the absence of records, gross gambling receipts shall be the maximum that would be due to an operator from that particular activity if operated at maximum capacity.))

Fees from players for entry into a player-supported jackpot held in conjunction with card games are not gross gambling receipts: Provided, That any portion of wagers deducted for any purpose other than increasing current prizes or repayment of amounts used to seed such prizes shall be treated as gross gambling receipts.

[Statutory Authority: Chapter 9.46 RCW.      91-21-053 (Order 228), § 230-02-110, filed 10/15/91, effective 11/15/91; 86-19-056 (Order 161), § 230-02-110, filed 9/15/86, effective 1/1/87; Order 5, § 230-02-110, filed 12/19/73.]

OTS-2825.1


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 230-02-400 Card game.


AMENDATORY SECTION [(Amending WSR 98-04-023, filed 1/28/98)]WAC 230-02-415
Card room employee defined.

A "card room employee" is any person who is involved in the operation of social card games conducted by a card room when such games involve the collection of fees.

Individuals who only perform duties of bartenders, waitresses or similar functions limited to providing food and drink service within the card room portion of the licensed premises are not "card room employees." Persons performing at least the following functions shall be designed as card room employees:

(1) Collecting fees;

(2) Dealing;

(3) Supervising any card game or card room employee, such as acting as a pit boss, floor person, section supervisor, etc.;

(4) Cashier duties such as selling or redeeming chips;

(5) Surveillance of dealers and card games to detect cheating or control functions;

(6) Controlling card room funds including keys to secure locations. ((;

(7) Key employees as defined in WAC 230-02-425.))

[Statutory Authority: RCW 9.46.070(5).      98-04-023, § 230-02-415, filed 1/28/98, effective 7/1/98.      Statutory Authority: RCW 9.46.070(16).      78-06-066 (Order 85), § 230-02-415, filed 5/25/78.]

Reviser's note: The bracketed material preceding the section above was supplied by the code reviser's office.

OTS-3761.1


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 230-02-425 Key employee defined.

OTS-2912.3


AMENDATORY SECTION(Amending Order 190, filed 4/18/89, effective 7/1/89)

WAC 230-04-022
Certification procedure -- Information required from all applicants.

In addition to other information required by the commission, each applicant shall provide the following information on or attached to the application:

(1) Copy of corporate applicants' articles of incorporation and bylaws; or, if not a corporation, a copy of any bylaws and other documents which set out the organizational structure and purposes of the organization;

(2) A copy of a nonprofit or charitable applicant's Internal Revenue Service tax exemption letter if one has been obtained;

(3) Details and copies of all lease or rental arrangements, whether oral or written, between the applicant and the owner of premises upon which the gambling activity will be conducted, if such premises are leased or rented;

(4) Details and copies of any and all franchise agreements or other agreements, whether written or oral, if any, between the applicant and distributors or manufacturers of equipment or between the applicant and any other person where those agreements relate to gambling activities or gambling equipment;

(5) Details and copies of all proposed management agreements or contracts between the applicant and any gambling service supplier involved in providing services defined in WAC 230-02-205. All such agreements or contracts shall be reviewed by commission staff prior to the effective dates of the agreements to assure compliance with this title. No financing or management services shall be provided prior to commission approval of the contracts;

(6) The name, address, date of birth, and Social Security number of each paid employee or agent who will work in the activity for which the license is sought and a schedule of the proposed number of employees, job descriptions, and a proposed pay schedule;

(((6))) (7) For each person listed below, a completed copy of the commission's form entitled "Personal information form":

(a) Each person who has a substantial interest in the applicant;

(b) Each person who is the chief executive officer, the chairman of a board, and the financial records officer of a corporation and/or bona fide nonprofit charitable organization;

(c) Each person who will serve in a supervisory capacity over those persons in the direct management or direct operation of the activity for which the license is sought;

(((7))) (8) If any information required on the application, changes or becomes inaccurate in any way, the commission shall be notified prior to issuance of a license.      Failure to notify the commission of any changes affecting an application may constitute grounds for suspension or revocation of all licenses.

(((8))) (9) Sections (1), (2), and (((6))) (7) shall not apply to applications by or on behalf of an incorporated city or town in the state of Washington.

[Statutory Authority: RCW 9.46.070 (7), (8), (9), (10), (14), (19) and (20).      89-09-047 (Order 190), § 230-04-022, filed 4/18/89, effective 7/1/89.]

OTS-2913.4


AMENDATORY SECTION(Amending Order 304, filed 11/21/96, effective 1/1/97)

WAC 230-04-140
Licensing of public card room employees.

(1) No person shall act as ((a public card room)) an employee in a Class E, F, or house-banked card room unless he or she has either received a license to do so from the commission or, if:

(a) The commission has not previously revoked a license or denied an application by that person for such a license; and

(b) He or she has properly applied for such license.      If there has been such a previous denial or revocation, or if the applicant has been convicted of, or forfeited bond upon a charge of, or pleaded guilty to certain offenses set forth in RCW 9.46.158, or violated any of the provisions of RCW 9.46.075 and WAC 230-04-400, that person shall not act as a public card room employee unless he or she has been issued a license by the commission.

(2) On or before the first day he or she actually performs work as a public card room employee, a person shall submit an application for a license to the commission.      Such application shall not be deemed complete and properly submitted for the purposes of this rule unless and until all questions on the commission's application form and attachments are fully and truthfully answered and the form, with all attachments, together with the required fee, has been delivered to the commission office during regular business hours (or actually deposited in the United States mail properly addressed to the commission): Provided, That ((the requirements of this section shall not apply to persons employed in a public card room operating under a Class B or Class D license only)) there will be a twenty-day waiting period from the date the application is postmarked (or date stamped by the commission if delivered in person) before the employee may begin performing as a card room employee in a house-banked card room. Commission staff may waive the twenty-day waiting period for an employee when there is an urgent and unexpected need to prevent an interruption in the card room activity beyond the control of the licensee. This waiver will only be allowed if expedited review procedures can be completed. Waivers will not be granted as a means to accommodate the start-up of operations, temporary employee absences, or to provide for special occasions or holidays that are within the control of the licensee. The fee for an emergency waiver shall be as required by WAC 230-04-204. In addition, the applicant must complete a training course as provided by the commission within 30 days after the first day worked.

(3) If an applicant elects to perform the duties of a card room employee prior to receiving a license as authorized under the provisions of paragraph (1)(a) and (b) above, the commission shall retain the entire application fee regardless of the disposition of the application.

(4) A sole owner, partner, major officer and/or owner of a substantial interest in a corporation licensed to operate a public card room shall not be required to be additionally licensed as a public card room employee to perform duties in connection with the card room.      Except as provided in this section, an operator of a public card room shall not employ any unlicensed person to perform duties for which a license is required in or in connection with a public card room, and shall take all measures necessary to prevent an unlicensed person from doing so.

(([(5)] The operator of a public card room or partner or officer of the entity operating the card room for which the applicant will work shall sign the application of each such public card room employee acknowledging that the applicant will be working for that operator with the operator's knowledge and consent.))

(5) A card room employee license shall be valid for a period not to exceed one year beginning on the date the application was submitted to the commission.

(6) A card room employee may change employers or begin employment at another location if they provide a copy of their license or card room employee's application to the new employer. The employer shall maintain a photocopy of each employee's license or card room employee's application on the licensed premises at all times. Such copies shall be available for review by commission staff and law enforcement personnel upon request.

(7) A certified Class III gaming employee may apply for a license conversion to a licensed card room on a form provided by the commission. A fee for the conversion shall be as required by WAC 230-04-204.

[Statutory Authority: RCW 9.46.070 and 9.46.116.      96-24-007 (Order 304), § 230-04-140, filed 11/21/96, effective 1/1/97.      Statutory Authority: Chapter 9.46 RCW.      87-09-043 (Order 167), § 230-04-140, filed 4/14/87.      Statutory Authority: RCW 9.46.070 (1), (7), (11), (14), and (17).      83-21-073 (Order 137), § 230-04-140, filed 10/18/83.      Statutory Authority: RCW 9.46.070(16).      80-03-059 (Order 98), § 230-04-140, filed 2/25/80; 79-09-029 (Order 91), § 230-04-140, filed 8/14/79; 78-08-055 (Order 86), § 230-04-140, filed 7/20/78, effective 9/1/78; 78-06-066 (Order 85), § 230-04-140, filed 5/25/78, effective 9/1/78.]

OTS-3760.1


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 230-04-142 Notification to the commission upon beginning, terminating, or changing employment -- Public card room employees.

OTS-3840.1


AMENDATORY SECTION(Amending Order 377, filed 11/30/99, effective 12/31/99)

WAC 230-04-203
Fees -- Commercial stimulant and other business organizations.

All persons seeking to operate gambling activities at business locations shall submit the following fees to the commission when applying for gambling licenses, permits, miscellaneous changes, inspection services, or when assessed the cost of special investigation procedures by the commission:



LICENSE TYPE

DEFINITION

FEE
1. CARD GAMES
Class B Up to five tables of limited card games - hearts, rummy, pitch, pinochle, and/or cribbage (Fee to play charged)

$ 166

Class C Tournament only, no more than ten consecutive days per tournament.

$

C-5 Up to five tables $ 166
C-10 Up to ten tables $ 300
C-15 Up to fifteen tables $ 500
Class D General - Up to five tables (No fee to play charged) $ 53
Class E *General (Fee to play charged)
E-1 One table only $ 398
E-2 Up to two tables $ 685
E-3 Up to three tables $ 1,142
E-4 Up to four tables $ 2,287
E-5 Up to five tables $ 3,440
Additional tables up to a maximum of fifteen may be authorized for an additional per table fee of $1000.
*In addition to the above initial license fee, the commission will assess all applicants/licensees the actual costs that exceed the license fee for conducting the initial investigation and inspection, any follow-up reviews or investigations involved in the approval of activities and schemes.
Class F Enhanced cardroom activities endorsement - Includes alternative fee collections (per hand; pot rake)((,)) and use of player-supported jackpot schemes ((and increased betting limits)).
Annual license fee $1,500
2. CARD GAMES - HOUSE-BANKED
All tables within a card room operating any house-banked card game shall be licensed under this license class.
*Annual license fee $6,000
Per table fee (up to fifteen tables) $1,500
*The commission will assess all applicants the actual costs for conducting the initial license investigation and premises inspection. Any post licensing follow-up reviews, inspections, internal control evaluations or subsequent phases of operation shall also be charged actual costs.      Licensees will be evaluated and charged for these additional authorizations/phases on an individual case by case basis.

3.

COMMERCIAL

AMUSEMENT

GAMES


(Fee based on annual gross

gambling receipts)

* Class A Premises only ** $ 285/$ 130
Class B Up to $ 50,000 $ 398
Class C Up to $ 100,000 $ 1,024
Class D Up to $ 250,000 $ 2,287
Class E Up to $ 500,000 $ 4,012
Class F Up to $1,000,000 $ 6,883
Class G Over $1,000,000 $ 8,610
* Allows a business that is qualified under WAC 230-04-138 (1)(f), (g), (h), (i), or (j) to enter into a contract with a class "B" or above commercial amusement game licensee to locate and operate amusement games upon their premises.
** Provides for a fee reduction of $150 when: Renewing an annual license; applying for an additional license(s) at the same premises; and/or applying for multiple licenses at the same premises.

4.

PUNCH BOARDS/

PULL-TABS


(Fee based on annual gross

gambling receipts)

VARIANCE*
Class A Up to $ 50,000 $ 5,000 $ 544
Class B Up to $ 100,000 $ 5,000 $ 971
Class C Up to $ 200,000 $ 10,000 $ 1,832
Class D Up to $ 300,000 $ 10,000 $ 2,663
Class E Up to $ 400,000 $ 10,000 $ 3,440
Class F Up to $ 500,000 $ 10,000 $ 4,153
Class G Up to $ 600,000 $ 10,000 $ 4,812
Class H Up to $ 700,000 $ 10,000 $ 5,416
Class I Up to $ 800,000 $ 10,000 $ 5,967
Class J Up to $ 1,000,000 $ 20,000 $ 6,765
Class K Up to $ 1,250,000 $ 25,000 $ 7,509
Class L Up to $ 1,500,000 $ 25,000 $ 8,201
Class M Up to $ 1,750,000 $ 25,000 $ 8,771
Class N Up to $ 2,000,000 $ 25,000 $ 9,290
Class O Over $ 2,000,000 Nonapplicable $ 10,208
* A licensee will be allowed a one-time variance for each license class without having to upgrade or pay the penalties set forth in WAC 230-04-260: Provided, That a licensee utilizing the variance shall be required to upgrade to the higher license class upon renewal.
5. PUNCH BOARD AND PULL-TAB SERVICE BUSINESS
(See WAC 230-04-133) *Initial application fee $ 206
Additional associate $ 129
Renewal $ 51
*Includes up to two associates.

6.

DISTRIBUTOR

(Fee based on annual gross sales of gambling related supplies and equipment)
(a) Class A Nonpunch board/pull-tab only $ 571
Class B Up to $ 250,000 $ 1,142
Class C Up to $ 500,000 $ 1,715
Class D Up to $1,000,000 $ 2,287
Class E Up to $2,500,000 $ 2,977
Class F Over $2,500,000 $ 3,667
In addition to the annual fee, the commission will assess all applicants the actual costs incurred in conducting the investigation and inspection necessary for initial certification.
(b) FUND-RAISING

EVENT EQUIPMENT

DISTRIBUTOR

Class A Rents or leases equipment for fund-raising event or recreational gaming activity up to 10 times per year.

$ 226

Class B Rents or leases equipment for fund-raising event or recreational gaming activity more than 10 times per year.

$ 571

7. GAMBLING SERVICE SUPPLIER
(See WAC 230-04-119) $ 594
In addition to the annual fee, the commission will assess all applicants the actual costs incurred in conducting the investigation and inspection necessary for initial certification.
An annual fee of $129 shall be charged for each new contract initiated by the gambling service supplier.
8. LINKED BINGO PRIZE PROVIDER
(See WAC 230-04-126) $ 3,815

9.

MANUFACTURER

(Fee based on annual gross sales of gambling related supplies and equipment)
Class A Pull-tab dispensing devices only $ 571
Class B Up to $ 250,000 $ 1,142
Class C Up to $ 500,000 $ 1,715
Class D Up to $1,000,000 $ 2,287
Class E Up to $2,500,000 $ 2,977
Class F Over $2,500,000 $ 3,667
In addition to the annual fee, the commission will assess all applicants the actual costs incurred in conducting the investigation and inspection necessary for initial certification, quality control inspection for additional activities or product lines, compliance suitability evaluations, and renewal of licenses when travel cost is incurred to complete the investigation.

10.

PERMITS

AGRICULTURAL FAIR/

SPECIAL PROPERTY

BINGO

Class A One location and event only (See WAC 230-04-191) $ 26
Class B Annual permit for specified different events and locations (See WAC 230-04-193)

$ 166

RECREATIONAL

GAMING ACTIVITY

(RGA)

(See WAC 230-02-505

and 230-25-330)

$ 53


11.

CHANGES
NAME (See WAC 230-04-310) $ 26
LOCATION (See WAC 230-04-320) $ 26
BUSINESS (Same owners) $ 53
CLASSIFICATION (See WAC 230-04-340)
LICENSE CLASS (See WAC 230-04-260) New class fee, less previous fee paid, plus

$ 26

DUPLICATE LICENSE (See WAC 230-04-290) $ 26
OWNERSHIP OF STOCK (See WAC 230-04-340) $ 53
LICENSE TRANSFERS (See WAC 230-04-125,

230-04-340, and

230-04-350)

$ 53

12.

SPECIAL FEES
INVESTIGATION (See WAC 230-04-240) As required
IDENTIFICATION AND

INSPECTION

SERVICES STAMPS

(See WAC 230-08-017) As required
QUALITY CONTROL

INSPECTION FEES

(See WAC 230-30-030) As required
REPLACEMENT OF

IDENTIFICATION

STAMPS

(See WAC 230-30-017)

$ 26

EXCEEDING LICENSE

CLASS

(See WAC 230-04-260) As required
REVIEW,

INSPECTION AND/

OR EVALUATION

OF EQUIPMENT,

PARAPHERNALIA,

SERVICES, OR

SCHEMES

(See WAC 230-12-315) As required
SPECIAL SALES

PERMITS

(See WAC 230-04-115) As required

13.

SIX-MONTH

PAYMENT PLAN


(See WAC 230-04-190)


$ 26

[Statutory Authority: RCW 9.46.070.      99-24-099 (Order 377), § 230-04-203, filed 11/30/99, effective 12/31/99; 98-21-010 (Order 366), § 230-04-203, filed 10/9/98, effective 11/9/98.      Statutory Authority: RCW 9.46.070(5).      97-23-053, § 230-04-203, filed 11/17/97, effective 6/30/98.      Statutory Authority: RCW 9.46.070 (5), (6), (11), (14).      97-14-012, § 230-04-203, filed 6/20/97, effective 7/21/97.      Statutory Authority: RCW 9.46.070 and 9.46.116. 96-24-007 (Order 304), § 230-04-203, filed 11/21/96, effective 1/1/97.      Statutory Authority: RCW 9.46.070. 95-12-052, § 230-04-203, filed 6/2/95, effective 7/3/95; 95-02-003 and 94-23-007, § 230-04-203, filed 12/22/94 and 11/3/94, effective 1/22/95 and 1/1/95.]

OTS-3805.1


AMENDATORY SECTION(Amending Order 377, filed 11/30/99, effective 12/31/99)

WAC 230-04-204
Fees -- Individuals.

Individuals shall submit the following fees to the commission when applying for gambling licenses, permits, miscellaneous changes, or when assessed the cost of special investigation procedures by the commission:



LICENSE TYPE DEFINITION FEE
1. CHARITABLE OR NONPROFIT GAMBLING MANAGER Original $ 166
Renewal $ 80
Change of Employer $ 80

2. LINKED BINGO PRIZE PROVIDER REPRESENTATIVE Original $226
Renewal $139

3. COMMERCIAL GAMBLING MANAGER Original $ 166
Renewal $ 80
Change of Employer $ 80

4. DISTRIBUTOR'S OR GAMBLING SERVICES SUPPLIER REPRESENTATIVE Original $ 226
Renewal $ 139

5. MANUFACTURER'S REPRESENTATIVE Original $ 226
Renewal $ 139

6. PUBLIC CARD ROOM EMPLOYEE CLASS A - Performs duties as defined in WAC 230-02-415 in a class E card room.
Original $ 166
Renewal $ 80
CLASS B - Performs duties as defined in WAC 230-02-415 in enhanced and house-banked card rooms.
Original,
in-state $ 224
Original,
out-of-state $ 279
Renewal $ 139
((Transfer/Additional

Employee/))Conversion/

Emergency Waiver Request

$55

7. OTHER FEES
CHANGE OF NAME (See WAC 230-04-310) $26
DUPLICATE LICENSE (See WAC 230-04-290) $26
OUT-OF-STATE (See WAC 230-04-240) As
RECORDS INQUIRY required

[Statutory Authority: RCW 9.46.070.      99-24-099 (Order 377), § 230-04-204, filed 11/30/99, effective 12/31/99; 98-21-010 (Order 366), § 230-04-204, filed 10/9/98, effective 11/9/98.      Statutory Authority: RCW 9.46.070(5).      97-23-053, § 230-04-204, filed 11/17/97, effective 6/30/98.      Statutory Authority: RCW 9.46.070 and 9.46.116.      96-24-007 (Order 304), § 230-04-204, filed 11/21/96, effective 1/1/97.      Statutory Authority: RCW 9.46.070.      96-09-070, § 230-04-204, filed 4/16/96, effective 7/1/96; 94-23-007, § 230-04-204, filed 11/3/94, effective 1/1/95.]

OTS-3804.1


NEW SECTION
WAC 230-04-207
Additional requirements -- House-banked card games.

Prior to being granted a license, each applicant for a house-banked card room license shall demonstrate their ability to comply with commission requirements for operation of house-banked card games. In order to demonstrate this capability, an applicant shall provide such information as the commission staff may require. Such information shall be reviewed and any discrepancies corrected prior to the granting of a license. At least the following shall be submitted as a part of their application:

(1) A detailed description of its planned system of internal accounting and administrative controls in the standard format prescribed by commission staff. Such information shall meet all requirements set forth in WAC 230-40-815 and be presented in both a narrative and diagrammatic form;

(2) A detailed diagram of the planned physical layout of the card room and all supporting installations. Such diagram shall include at least the following:

(a) The location of all gaming tables;

(b) The location of all surveillance cameras;

(c) The count room;

(d) The surveillance room; and

(e) The cashier's cage;

(3) A detailed description of:

(a) Card games to be played, including rules of play; and

(b) Type of gaming tables, including table layouts.

[]

OTS-3806.1


AMENDATORY SECTION(Amending Order 12, filed 2/14/74)

WAC 230-04-255
Director may issue temporary licenses ((not to exceed sixty days)) -- Procedures -- Restrictions.

The director may issue a temporary license ((by the commission)) upon the administrative approval of the application ((for a license)). The following procedures and restrictions apply to temporary licenses:

(1) The director shall not issue temporary licenses to:

(a) Manufacturers; and

(b) Applicants to operate house-banked card games;

(2) Temporary licenses shall allow an applicant to conduct such activity for a period not to exceed sixty days.      If the application is not approved by the commission during the sixty day period, ((such)) the temporary license shall become void: Provided, That if the commission does not conduct a meeting within the sixty-day period, the director may approve an additional temporary license to expire no later than the day following the next scheduled public meeting;

(4) Once approved by the commission, a temporary license will be replaced with the issuance of a license to expire one year from the initial date of the temporary license ((issued by the director under this provision)).

[Order 12, § 230-04-255, filed 2/14/74.]

Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.

OTS-3807.1


AMENDATORY SECTION(Amending Order 91, filed 8/14/79)

WAC 230-04-450
Display of licenses.

All licenses or permits granted by the commission shall be prominently displayed in the licensee's gaming area and available for inspection by commission staff, law enforcement agents and the public at all times ((upon the licensed premises in such position as they may be observed by persons participating in gambling activities on the licensed premises, except as may otherwise be provided by these rules.

If a licensed employee works in similar employment for one or more additional employers than the employer upon whose premises the original license is displayed, the employee may obtain from the commission such copy or copies of his or her license as may be necessary for display upon the premises of such additional employer)): Provided, That individual licenses, as set forth in WAC 230-04-204, shall not be required to be on display but must be available to the public upon request.

[Statutory Authority: RCW 9.46.070(7).      79-09-029 (Order 91), § 230-04-450, filed 8/14/79.      Statutory Authority: RCW 9.46.070(13).      78-06-066 (Order 85), § 230-04-450, filed 5/25/78; Order 5, § 230-04-450, filed 12/19/73.]

OTS-2914.2


AMENDATORY SECTION(Amending Order 369, filed 12/1/98, effective 1/1/99)

WAC 230-08-040
Sales invoices -- Minimum information to be recorded for transfer of gambling equipment and merchandise -- Retention -- Penalties.

The following requirements apply to sales invoices:

(1) In addition to entries required by WAC 230-08-025, the following information shall be recorded on invoices for sales or transfer of gambling equipment ((and)), merchandise, and card room forms:

(a) Punch boards/pull-tabs - for each board or series:

(i) Trade name of device;

(ii) Type of device;

(iii) Form number or other manufacturer-assigned scheme to specifically identify a device, including the size or number of chances; and

(iv) Identification and inspection services stamp number.

(b) Pull-tab dispensing devices:

(i) Trade name of device;

(ii) Type of device; and

(iii) Identification and inspection services stamp number.

(c) Disposable bingo cards - for each set of cards or collation of packets:

(i) Type of product, including product line;

(ii) Description of product, including the number of cartons, "series," "on," "cut," and "up";

(iii) Identification and inspection services stamp number;

(iv) Serial number or, if packets, serial number of the top page;

(v) Color and border pattern or, if packets, color and border pattern of the top page;

(vi) The unit or package number when a series or collation has been divided as authorized in WAC 230-20-192(6); and

(vii) For disposable bingo cards to be sold for linked bingo prizes the beginning and ending sheet numbers sold to or returned from the operator.

(d) Merchandise to be used as prizes for any gambling activity, whether purchased from a licensed distributor or from other than a licensed distributor, must be recorded on a sales invoice or receipt.      The following information must be on the sales invoice or receipt provided by the seller:

(i) The date of purchase;

(ii) The company's name and adequate business address;

(iii) A full description of each item purchased;

(iv) The quantity of items purchased; and

(v) The cost per individual items purchased; and

(e) Card room forms - all required serially prenumbered forms:

(i) Type of form;

(ii) Beginning and ending serial numbers; and

(iii) Quantity of forms.

(f) All other gambling equipment:

(i) Trade name of device;

(ii) Type of device;

(iii) Serial number or other identification numbers or characteristics; and

(iv) Identification and inspection services stamp number.

(2) All sales invoices and receipts must be maintained by the ((operator)) licensee for at least three years.

(3) Any manufacturer, distributor, linked bingo prize provider, or licensed representative of the above, who fails to accurately complete any invoice for the sale or return of a punch board, pull-tab series, pull-tab dispensing device, disposable bingo cards, related merchandise, or other gambling device may be assessed a fee of up to fifty dollars per incomplete invoice.      The fee shall be used to defray extra costs incurred by the commission in tracking transfers or other monitoring procedures as a result of errors or omissions.

[Statutory Authority: RCW 9.46.070.      98-24-090 (Order 369), § 230-08-040, filed 12/1/98, effective 1/1/99.      Statutory Authority: RCW 9.46.070 (5), (6), (11), (14).      97-14-012, § 230-08-040, filed 6/20/97, effective 7/21/97.      Statutory Authority: RCW 9.46.070.      94-01-033, § 230-08-040, filed 12/6/93, effective 1/6/94.]

OTS-2915.5


AMENDATORY SECTION(Amending Order 238, filed 4/21/93, effective 7/1/93)

WAC 230-08-090
Daily records -- Card games.

In addition to any other requirements set forth in these rules, persons licensed to operate card rooms at which a fee is charged to play or which operates a player-supported jackpot (PSJ) or house-banked card games shall be required to prepare a detailed record covering each ((occasion.      This)) day of operation. Each separate record shall be maintained continuously during hours of operation and ((updated immediately following the collection of fees during all time periods.      The commission shall provide to the licensee a consecutively prenumbered standard format record sheet.      This form shall contain the following:

(1) The date of the occasion;

(2) The time that the half hour fee was charged;

(3) The amount of half hour fee charged per table;

(4) The number of players at each table at half hour intervals to include all nonpaying house players;

(5))) entries made as required by this section. The format for such records shall be as prescribed by the commission. The records shall include information to be placed in a form, record or document, or in stored data which shall be annotated in ink or other permanent form. Data maintained in computer data bases must be printed on a periodic basis. Daily card room records shall be maintained as follows:

(1) Separate records shall be prepared for each day social card games are played and fees collected or house-banked card games are operated. Such records shall be completed for each table and each PSJ for which fees are collected from players. The minimum daily records shall include the following information:

(a) The date and time period during which fees were collected or house-banked card games were operated.

(b) The assessment method and the fee charged per assessment method for each table.

(c) The names and time of play for each nonpaying house player (which may only include licensed card room employees and the licensee);

(((6))) (d) The amount of fees collected at each table at each ((half hour)) collection interval;

(((7))) (e) The ((cumulative)) gross amount received from fees collected on each ((occasion and in total;

(8) A reconciliation of chips and cash on a daily basis; and

(9) A printed name, signature, and hours worked of the person who was responsible for the collection of fees.)) operating day by table and by assessment method.

(f) The number of players at the time of fee collection when fees are assessed based on a period of time;

(g) A record of card room employees and hours worked; and

(h) The total drop which includes all cash placed in drop boxes and the net win or loss by the table and game type from house-banked card games.

(2) Fees for tournaments shall be recorded as set forth in WAC 230-40-055.

(3) PSJ records shall include the following information in addition to the information required by subsection (1) of this section:

(a) A separate entry for each type of PSJ for which fees were collected to include:

(i) Table number;

(ii) Prize fund number; and

(iii) Assessment rate.

(b) PSJ fund accrual record.

(4) A daily summary record that includes a reconciliation of all fees collected during an operating day shall be prepared for each day card games are operated and fees collected. This record shall include at least the following:

(a) The name of the licensee;

(b) The date of the activity. If the activity spans two days, the day that the activity begins shall be recorded;

(c) Card room hours of operation;

(d) The beginning and ending balances of all chips and cash in the cage;

(e) The printed name and signature of person(s) preparing the record; and

(f) Such other daily records as required for specific card room activities.

(5) All detailed records ((sheets issued to a licensee shall be numerically accounted for, and)) prepared shall be maintained ((on the premises)) for a period of not less than three years ((from the date of the occasion which it records.      An "occasion" for card rooms shall be defined as 20 hours beginning at 6:00 a.m. one day and running continuously through 2:00 a.m. the following day)). At least the past six months of records must be available on premises. All other records shall be available within forty-eight hours upon request by commission staff, local law enforcement or taxing authorities.

[Statutory Authority: RCW 9.46.070(8), 9.46.0325 and 9.46.070.      93-10-005 (Order 238), § 230-08-090, filed 4/21/93, effective 7/1/93.      Statutory Authority: RCW 9.46.070 (8) and (17).      83-23-055 (Order 138), § 230-08-090, filed 11/15/83.      Statutory Authority: RCW 9.46.070(8) and (14).      82-11-028 (Order 120), § 230-08-090, filed 5/11/82; Order 23, § 230-08-090, filed 9/23/74.]

OTS-3722.1


NEW SECTION
WAC 230-08-027
House-banked card games -- General accounting records to be maintained.

Every licensee authorized to offer house-banked card games shall keep and maintain a complete set of records, which have been approved by commission staff. Such records shall include all details of activities related to the conduct of the licensed activity. The following requirements shall apply:

(1) Each licensee shall maintain legible, accurate and complete records of all transactions relating to the revenues and costs of the gaming operation. These records shall be maintained in a format to ensure consistency, comparability, and effective disclosure of financial information.

(2) General accounting records shall be maintained on a double entry system of accounting with transactions recorded on an accrual basis, to include detailed, supporting, subsidiary records, sufficient to meet the requirements below.

(3) The detailed, supporting and subsidiary records shall include, but not necessarily be limited to:

(a) Records of all patrons' checks initially accepted, deposited, and returned as "uncollected," and ultimately written off as "uncollectible";

(b) Statistical game records to reflect drop and win amounts for each table, for each game, and for at least each period for which the drop boxes are removed, which shall be at the minimum, the end of each gaming day;

(c) Records of investments in property, including, but not limited to, equipment used directly in connection with the gaming operation;

(d) Records of amounts payable by the gaming operation;

(e) Records which identify the purchase, receipt, and destruction of all cards and gaming chips used in wagering; and

(f) Records of services provided for the operation of gaming activity.

(4) Whenever duplicate or triplicate copies are required of a form, record or document:

(a) The original, duplicate, and triplicate copies shall be color-coded;

(b) If under these standards, forms, records, and documents are required to be inserted in a locked dispenser, the last copy shall remain in a continuous unbroken form in the dispenser; and

(c) If under these standards, forms or serial numbers of forms are required to be accounted for or copies of forms are required to be compared for agreement and exceptions noted, such exceptions shall be reported immediately to the commission for investigation.

(5) All forms, records, documents and stored data required to be prepared, maintained and controlled shall:

(a) Have the title of the form, record, document, or stored data such as "fill slip," "request for fill," "credit slip," "request for credit," "reconciliation," etc., imprinted or preprinted thereon or therein; and

(b) Be located at the licensed premises for three years: Provided, That the director or the director's designee may waive parts of this section if requested by the licensee.

(6) Licensees shall maintain a records system that ensures all applicable employees have met licensing requirements. The system shall include employee names, license numbers and expiration dates. In addition, photocopies of all current employees' licenses must be maintained on the premises. If an employee license has not yet been issued, the licensee shall maintain a copy of the temporary employment authorization, documentation that the required payment has been made, and whether the employee has adhered to the twenty-day waiting period, if applicable. The licensee shall ensure the commission is notified if an employee license has not been received within sixty days of employment.

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OTS-3808.1


AMENDATORY SECTION(Amending WSR 95-07-094, filed 3/17/95, effective 7/1/95)

WAC 230-08-160
Quarterly activity reports by operators of social and public card rooms.

Each licensee for the operation of social or public card rooms shall submit an activity report to the commission concerning the operation of the licensed activity and other matters set forth below: Provided, That persons licensed under Class "D" - general, no fee charged, are exempt from all portions of this section:

(1) Reports shall be submitted detailing activities occurring during each of the following periods of the year:

(a) January 1st through March 31st;

(b) April 1st through June 30th;

(c) July 1st through September 30th; and

(d) October 1st through December 31st.

(2) A report shall be submitted for any period of time the activity was operated or a license was valid.      If a license is not renewed, a report for the period between the previous report filed and the expiration date shall be submitted;

(3) The report form shall be furnished by the commission and the completed report shall be received in the office of the commission or postmarked no later than thirty days following the end of the period for which it is made;

(4) The report shall be signed by the highest ranking executive officer or their designee.      If the report is prepared by someone other than the licensee or an employee, the preparer shall print his/her name and phone number on the report;

(5) The report shall be completed in accordance with the related instructions furnished with the report.      The report shall include the following:

(a) Gross gambling receipts ((from the collection of fees charged for allowing persons to play));

(b) Full details of all compensation paid by the licensee to each person for any work connected with the management, promotion, conduct or operation of the card room((, including:

(i) A description of the work performed by that person, including identifying each dealer;

(ii) The hourly wage, including benefits;

(iii) The total hours worked during the period)); ((and

(iv))) (c) Full details of all other expenses related to the operation of the card room;

(((c))) (d) Net gambling income or loss from the operation of the card room for the reporting period;

(((d))) (e) The normal days and times of operation of the card room; and

(((e))) (f) The total hours the card room was open during the period.

[Statutory Authority: RCW 9.46.070 and 9.46.0217.      95-07-094, § 230-08-160, filed 3/17/95, effective 7/1/95.      Statutory Authority: RCW 9.46.070.      94-11-095 (Order 251), § 230-08-160, filed 5/17/94, effective 7/1/94.      Statutory Authority: Chapter 9.46 RCW.      86-19-056 (Order 161), § 230-08-160, filed 9/15/86, effective 1/1/87.      Statutory Authority: RCW 9.46.070 (8) and (9).      85-06-002 (Order 147), § 230-08-160, filed 2/22/85.      Statutory Authority: RCW 9.46.070 (4), (7), (8) and (11).      83-06-077 (Order 127), § 230-08-160, filed 3/2/83; Order 80, § 230-08-160, filed 12/28/77; Order 70, § 230-08-160, filed 5/24/77.]

OTS-2916.2


AMENDATORY SECTION(Amending Order 303, filed 11/21/96, effective 12/22/96)

WAC 230-12-050
Extension of credit, loans, or gifts prohibited -- Limited exception.

No licensee, member or employee thereof shall extend credit, make a loan, or grant a gift to any person playing in an authorized activity, or which enables a person to play in an authorized activity.      The consideration required to participate in the activity shall be collected in full, by cash, check, or electronic point-of-sale bank transfer, prior to participation: Provided, That this prohibition shall not apply to the following situations:

(1) The consideration paid for the opportunity to play a punch board or pull-tab series may be collected immediately after the play is completed only when such consideration is ten dollars or less;

(2) When a bona fide charitable or bona fide nonprofit organization conducting any of the activities authorized by chapter 9.46 RCW or commission rules has a regular billing system for all of the activities of its members with such organization, such billing system may be utilized in connection with the playing of any of the activities authorized hereunder if:

(a) The playing of such activity is limited to regular members of such organization who have become regular members prior to the commencement of such activity and whose qualifications for membership were not dependent upon, or in any way related to, the playing of such activity; and

(b) The commission has given its prior written consent to the use of such billing system in connection with the conduct of activities authorized under these rules.

(3) Charitable or nonprofit organizations utilizing credit cards, issued by a state and/or federally regulated financial institution, for payment to participate in raffles; and

(4) Promotional gifts detailed below:

(a) The providing of free or discounted food, drink, or merchandise to card players at a public card room;

(b) Promotional activities conducted as a part of bingo games and authorized by WAC 230-20-125;

(c) Performances as authorized by WAC 230-20-111;

(d) Free play for card playing as authorized by WAC 230-40-050(((4))) (7);

(e) "Free roll" or customer appreciation tournaments as authorized by WAC 230-40-055(2); and

(f) Promotional game cards meeting the standards of WAC 230-46-070 (1)((, (a), (b), (c), (d), (e))).

[Statutory Authority: RCW 9.46.070, 9.46.0209, 9.46.0237, 9.46.0205 and 9.46.075.      96-24-008 (Order 303), § 230-12-050, filed 11/21/96, effective 12/22/96.      Statutory Authority: RCW 9.46.070.      94-13-099 (Order 253), § 230-12-050, filed 6/15/94, effective 7/16/94.      Statutory Authority: RCW 9.46.070 (11), (14) and 9.46.0218 [9.46.0281].      89-05-024 (Order 186), § 230-12-050, filed 2/13/89; Order 51, § 230-12-050, filed 4/30/76; Order 15, § 230-12-050, filed 4/17/74; Order 5, § 230-12-050, filed 12/19/73.]

OTS-3723.1


NEW SECTION
WAC 230-12-072
Player-supported jackpot funds -- Deposit requirements.

Each licensee authorized to conduct player-supported jackpots (PSJs) shall protect and ensure proper accountability of all funds collected from players. Funds shall be controlled as follows:

(1) Each licensee shall maintain a bank account for holding PSJ funds. The account shall be kept separate from all other accounts of the entity and be maintained in a recognized Washington state depository for purposes of depositing PSJ funds.

(2) Only receipts from PSJ shall be deposited into the account.

(3) No expenditures shall be made from the receipts of any PSJ until such receipts have first been deposited in the PSJ: Provided, That licensees may pay out prizes won during the operating day and deduct administrative expenses prior to deposit.

(4) Receipts from the operation of PSJs, which are being held pending disbursement, shall be deposited in the licensee's PSJ account within two banking days of the date of collection: Provided, That funds deposited within two days to an armored car service shall meet this requirement.

(5) All deposits of PSJ funds shall be specifically identified by type of fund and dates of collection. The validated deposit receipt shall be kept as a part of the records required by WAC 230-08-090.

(6) At the end of each month, the account balance per the bank statement shall be reconciled to the PSJ fund balances. The reconciliation shall be kept as a part of the records required by WAC 230-08-090.

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OTS-3724.1


NEW SECTION
WAC 230-12-073
House-banked card games -- Prizes -- Deposit requirements.

Each organization licensed to conduct house-banked card games shall ensure sufficient funds are available to pay prizes offered. Funds shall be controlled as follows:

(1) Each licensee shall maintain a bank account for holding jackpot prizes accrued at house-banked card games. The account shall be separate from all other accounts of the entity and be maintained in a recognized Washington state depository for purposes of depositing prize funds.

(2) Amounts accrued for any house-banked game which offers a progressive jackpot shall be deposited into the jackpot prize account at least weekly for all disclosed and reserve jackpot funds.

(3) In addition to any progressive jackpot prize funds required to be maintained in the bank account, licensees shall also deposit and maintain in the account an amount equal to the total of all individual prizes offered which exceed twenty-five thousand dollars. For games in which the prize is based on the amount wagered, the highest wager allowed by the licensee shall be used in computing the individual prize amount for purposes of determining the deposit requirement.

(4) No game shall be offered for play until the above conditions have been met. At anytime that the prize account is reduced below the level required, the licensee shall immediately cease operating games until they are in compliance. At no time shall the account go below the total amount of progressive jackpots and individual prizes offered over twenty-five thousand dollars. Failure to maintain funds as required above shall be prima facie evidence of defrauding the public in violation of RCW 9.46.190.

(5) A record of all deposits shall specifically identify by game name and number and dates of collection for progressive prizes. The validated deposit slip shall be kept as part of the records required by WAC 230-08-090.

(6) At the end of each month, the account balance per the bank statement shall be reconciled to the jackpot prize balances. The reconciliation shall be kept as part of the records required by WAC 230-08-090.

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