WSR 07-12-058

PROPOSED RULES

GAMBLING COMMISSION


[ Filed June 4, 2007, 10:39 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 07-04-059.

Title of Rule and Other Identifying Information: New chapter 230-14 WAC, Punch boards and pull-tabs.

Hearing Location(s): Hilton, 301 West 6th Street, Vancouver, WA 98660, (360) 993-4500, on August 10, 2007, at 9:30 a.m.

Date of Intended Adoption: August 10, 2007.

Submit Written Comments to: Susan Arland, P.O. Box 42400, Olympia, WA 98504-2400, e-mail Susan2@wsgc.wa.gov, fax (360) 486-3625, by August 1, 2007.

Assistance for Persons with Disabilities: Contact Shirley Corbett, Executive Assistant, by August 1, 2007, TTY (360) 486-3637 or (360) 486-3447.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The gambling commission is rewriting its rules manual using plain English techniques. We anticipate the project will be completed by January 1, 2008. The rules manual is being broken into sections and rewritten a section at a time. This filing is to provide notification that rules regarding the operation of punch boards and pull-tabs are under review and are now being rewritten in plain English.

SUBSTANTIVE RULE CHANGES:


Post-1/1/2008 WAC 230-14-001 Defining "licensee," "licensees," "operator," and "operators."

We added a definition of "licensee," "licensees," "operator," and "operators" to the post-1/1/2008 chapter because the terms were used in the pre-1/1/2008 rules without being clearly defined.

We are defining these terms in the post-1/1/2008 rules to make it clear that anyone operating the gambling activity - sometimes the licensee, sometimes a bartender or tavern worker - has to understand the gambling activity and has to obey the operating rules. For instance, if a tavern worker knows that a pull-tab game has an incorrect number of pull-tabs, we don't want him or her putting it out for play. We also want all persons operating the gambling activity to keep the required records and follow the correct procedures.

This post-1/1/2008 definition makes it clear that those who are operating punch boards and pull-tabs, even if they are not licensed, must meet the requirements of this chapter.

Post-1/1/2008 WAC 230-14-005 Defining "punch board."

Pre-1/1/2008 WAC 230-02-270 Punch board defined.

We removed the term "device" from the post-1/1/2008 rule so that readers would not confuse it with "gambling device" which is defined in RCW 9.46.0241.

The statute defines "gambling device." In other post-1/1/2008 chapters, when discussing the various pieces of equipment which make gambling activity possible, we have used "gambling equipment" as defined in WAC rule (pre-1/1/2008 WAC 230-02-412 and post-1/1/2008 WAC 230-03-200 Defining gambling equipment).

The change adds consistency with the rules in other post-1/1/2008 chapters where we have removed the word "device" when referring to gambling equipment.

Post-1/1/2008 WAC 230-14-025 Punch boards, pull-tabs, and pull-tab dispensers must meet all requirements.

Pre-1/1/2008 WAC 230-30-090 All devices must comply with rules.

We added "chapter 9.46 RCW" to the post-1/1/2008 requirements that punch boards, pull-tabs, and pull-tab dispensers must meet. This requirement has always been implied, but here we are making it explicit in the post-1/1/2008 rules.

The change adds consistency with the rules in other post-1/1/2008 chapters where we've added compliance with chapter 9.46 RCW as an explicit requirement.

NEW DEFINITION


Post-1/1/2008 WAC 230-14-035 Defining "pull-tab series."

We added a definition of "pull-tab series" to the post-1/1/2008 chapter because the term is used in the pre-1/1/2008 rules without being clearly defined. We wanted to have a clear definition in the post-1/1/2008 rules.

Post-1/1/2008 WAC 230-14-050 Operating restrictions for punch boards and pull-tabs.

Pre-1/1/2008 WAC 230-30-050 Punch board and pull-tab operating restrictions and dispensing limitations.

The pre-1/1/2008 rule states that operators must ensure that "no unauthorized person is allowed to play or sell" punch boards or pull-tabs. We added "buys" to the post-1/1/2008 restrictions on owners because we don't want unauthorized persons - underage persons or intoxicated players, for example - to be able to buy the punch board or pull-tabs, either.

These changes clarify requirements licensees already had to meet.

Post-1/1/2008 WAC 230-14-055 Selling pull-tabs.

Pre-1/1/2008 WAC 230-30-050 Punch board and pull-tab operating restrictions and dispensing limitations.

We removed the phrase "Failing to mix pull-tabs may result in a minimum five-day suspension of their license for each series not mixed" from the post-1/1/2008 rule language. We feel that the named penalty in the pre-1/1/2008 rule restricts our ability to enforce the restriction given different facts. For example, a five-day suspension might be too high for an unintentional first time violation, but too lenient for a repeated, intentional violation.

Further, the requirement to mix pull-tab series is repeated several times in the pre-1/1/2008 rules, but we have removed the redundancies and made one post-1/1/2008 rule about mixing pull-tabs.

We also added an example to the section on the use of spindle pull-tabs in the post-1/1/2008 rule. This clarifies what a "nearby surface" means in the pre-1/1/2008 rule language.

The rule changes eliminate a redundancy, give more flexibility for enforcement, and clarify meaning in the post-1/1/2008 rule.

Post-1/1/2008 WAC 230-14-060 Defining "flare."

We added a definition of "flare" to the post-1/1/2008 chapter because the term is used throughout the pre-1/1/2008 rules without being clearly defined.

We wanted to have a clear definition in the post-1/1/2008 rules.

Post-1/1/2008 WAC 230-14-070 Displaying flares.

Pre-1/1/2008 WAC 230-30-106 Punch board and pull-tab flares restrictions -- Standards -- Substitute flares.

The pre-1/1/2008 rule has a requirement about the use of substitute flares with pull-tab series, but we separated flare and substitute flare requirements into two rules.

Punch boards use only substitute flares because punch boards come with an attached flare (also known as a "face sheet"). Therefore, any flare used with a punch board would be a substitute flare. The differences between flares and face sheets are clear to most manufacturers and agents, but could be confusing to new operators or manufacturers.

This change adds clarity and consistency to the post-1/1/2008 chapter.

Post-1/1/2008 WAC 230-14-100 Removing prizes from flares.

Pre-1/1/2008 WAC 230-30-070 Control of prizes -- Restrictions -- Bonus prizes -- Displaying -- Procedures for awarding.

The operator is required to delete all references to the prize from the flare, and from any other list, sign, or notice. The pre-1/1/2008 rule adds, "...in such a manner that all future customers will know the prize is no longer available." We propose removing this phrase in the post-1/1/2008 because we feel that "permanently and conspicuously" deleting is more than enough to meet the requirement.

We also recommend removing the language in the pre-1/1/2008 about the director initiating action for a violation of RCW 9.46.190. Since the violation would fall under the RCW, we are removing a redundancy between the WAC and the RCW.

The changes remove excess verbiage and redundancies in the pre-1/1/2008 rules that don't add anything to the real requirements.

Post-1/1/2008 WAC 230-14-115 Defacing winning punches or pull-tabs.

Pre-1/1/2008 WAC 230-30-070 Control of prizes -- Restrictions -- Bonus prizes -- Displaying -- Procedures for awarding.

We propose changing the pre-1/1/2008 requirement for destruction of winning punches or pull-tabs to "permanently defacing." This phrase covers both marking and perforating as stated in the pre-1/1/2008 rule and makes the post-1/1/2008 rule consistent with other rules on defacing parts of the boards or series. This change increases clarity of the requirement in the rule.

Post-1/1/2008 WAC 230-14-150 Awarding seal card pull-tab winners.

Pre-1/1/2008 WAC 230-30-034 Seal card pull-tab series -- Definitions -- Restrictions.

The pre-1/1/2008 rule is ambiguous about what happens if the winner of a seal card pull-tab cannot be located within fourteen days to receive the prize. It states that operators must make rules for their procedures, including how they will select a second winner, but it doesn't say that the prize must be awarded.

We felt that this ambiguity needed to be addressed and clarified, so in the post-1/1/2008 rule we added that the operator must select a second winner to receive the prize. This change removes an ambiguity which has existed in the rule since it was originally passed.

Post-1/1/2008 WAC 230-14-180 Paying out prizes and defacing tabs in progressive jackpot pull-tab series.

Pre-1/1/2008 WAC 230-30-025 Progressive jackpot pull-tab series -- Definitions -- Restrictions -- Operating procedures.

We removed the pre-1/1/2008 rule requirement that operators record a winner's full name, address, and social security number for jackpot prizes six hundred dollars or greater for federal income tax purposes. One reason for this change is that we no longer seek to enforce federal requirements on operators and licensees. The other reason is that identify [identity] theft potential rises when operators have access to winners' social security numbers and other personal information. By requiring them to keep it, we put them at risk for accusations of abetting identity theft.

Our second change to the pre-1/1/2008 rule was to remove the prohibition against winners cashing their pay out checks on the licensed premises. In player supported jackpots (PSJs) in the card game rules, winners are allowed to cash their pay out checks on the licensed premises. It seems that prohibiting punch board or pull-tab winners from doing the same would be an inconsistency in enforcement.

Post-1/1/2008 WAC 230-14-185 Additional recordkeeping for progressive jackpot pull-tab series.

Pre-1/1/2008 WAC 230-30-025 Progressive jackpot pull-tab series -- Definitions -- Restrictions -- Operating procedures.

We revised the pre-1/1/2008 rule to remove the so-called "laundry list" of requirements that are already printed on the form we require licensees to complete. This change would match other instances in the post-1/1/2008 rules where we have indicated that forms must be completed "in the format we require." It adds consistency to the post-1/1/2008 rules as a whole.

Post-1/1/2008 WAC 230-14-190 Defining "event pull-tabs" and "event round."

Pre-1/1/2008 WAC 230-30-033 Event pull-tab series -- Definitions -- Restrictions.

We removed the phrase "secondary element of chance" from the post-1/1/2008 rule because it conflicts with post-1/1/2008 bingo WAC 230-10-280 about which types of games constitute a second element of chance in a bingo game.

Post-1/1/2008 WAC 230-14-200 Defining "bonus pull-tab series."

We included a definition of "bonus pull-tab series" to the post-1/1/2008 rules chapter because this particular type of pull-tab series has not been defined before. The pre-1/1/2008 rule about bonus pull-tab series was passed in 1997 and amended in 1999, but it did not include a definition of the series.

Post-1/1/2008 WAC 230-14-205 Operating requirements for bonus pull-tab series.

Pre-1/1/2008 WAC 230-30-040 Bonus pull-tab series -- Definitions -- Restrictions.

We made a small change to the post-1/1/2008 rule to correct something that was overlooked when the pre-1/1/2008 rule was originally drafted in 1997.

In subsection (3) of the post-1/1/2008 rule, we changed the "and" between the requirements for the bonus pull-tab series to an "or" because we do not want operators of bonus pull-tab series to allow any of the three components listed in subsection (3) to be a part of the pull-tab series.

Using "and" implies to some readers that they only have to avoid using a series that has all three of the components, not each component individually.

It's unlikely that a bonus pull-tab series would have all three components, so operators have been complying with the requirement despite the error.

Post-1/1/2008 WAC 230-14-230 Transferring a carry-over jackpot to another game.

Pre-1/1/2008 WAC 230-30-045 Carry-over jackpot pull-tab series -- Definitions -- Requirements.

We removed the reference in the pre-1/1/2008 rule to the limit on accrued contribution amounts from series (two thousand dollars) because the limit for accrued contribution amounts is already in post-1/1/2008 WAC 230-14-195 "Prize limits for carry-over jackpot pull-tab series."

The change removes a redundancy in the pre-1/1/2008.

Post-1/1/2008 WAC 230-14-240 Distributing carry-over pull-tab jackpots.

Pre-1/1/2008 WAC 230-30-045 Carry-over jackpot pull-tab series -- Definitions -- Requirements.

The pre-1/1/2008 rule states that if "a licensee" ceases to operate gambling activities the carry-over jackpot must be distributed in one of four ways. We changed that pre-1/1/2008 rule language to identify the entity ceasing operations as a "business" in the post-1/1/2008 rule rather than a licensee. Once they've stopped operating, the entity is no longer qualified to hold a commercial stimulant license because they no longer have the underlying food and drink business.

We also removed the list of reasons in the pre-1/1/2008 rule for ceasing operation ("due to a sale, closure, or failure to maintain a valid gambling license") because the reasons have little bearing on the business' status as a nonlicensee.

We also changed the transfer language in pre-1/1/2008 rule to refer to "the new owners who bought the business" rather than "the licensee, which has a valid gambling license." The new business has to undergo a separate licensure process and we want the business ceasing operation to understand that it simply doesn't transfer the carry-over jackpot to the new owner unless and until that business owner has been licensed.

If it's not closing because of a sale, the business ceasing operation must choose one of the other methods of distribution for the carry-over jackpot.

These changes clarify the role of the business distributing the carry-over jackpot and to whom that entity can distribute the jackpot.

Pre-1/1/2008 WAC 230-30-045(9) Carry-over jackpot pull-tab series -- Definitions -- Requirements.

We removed the pre-1/1/2008 rule requirement that operators record a winner's full name, address, and social security number for carry-over jackpot prizes six hundred dollars or greater for federal income tax purposes. One reason for this recommendation is that we no longer seek to enforce federal requirements on operators and licensees.

The other reason is that identify [identity] theft potential rises when operators have access to winners' social security numbers and other personal information. By requiring them to keep it, we put them at risk for accusations of abetting identity theft.

Operators already provide jackpot winners with the federal form to complete for tax obligations, so the tax consequences are already explained to the players.

Post-1/1/2008 WAC 230-14-250 Recording carry-over jackpots on cash basis.

Pre-1/1/2008 WAC 230-30-045 Carry-over jackpot pull-tab series -- Definitions -- Requirements.

We removed the pre-1/1/2008 rule requirement that Class F and above bingo licensees have to receive special approval from the director to account for their punch board and pull-tab prizes because licensees in Class F and above bingo are already using the accrual method to account for bingo prizes. It would be a simple thing for them to account for their punch board and pull-tab prizes in a similar manner.

We also propose adding a definition of recording on a "cash basis" to the post-1/1/2008 rule for operators who may not be familiar with that term.

The changes make the post-1/1/2008 rule less restrictive to licensees and clarify an accounting term.

Post-1/1/2008 WAC 230-14-255 Net income and cash flow requirements when operating punch boards or pull-tabs.

Pre-1/1/2008 WAC 230-30-052 Punch boards and pull-tabs operated by charitable or nonprofit organizations -- Net income required.

The pre-1/1/2008 rule warns charitable and nonprofit licensees of their responsibility under RCW 9.46.010 to conduct gambling only for "the raising of funds for the promotion of" their organization. Therefore, their net income from punch boards and pull-tabs "shall not be less than zero when measured over the annual license period."

We changed the post-1/1/2008 rule to remove the reference to the RCW because the rule merely restates the RCW and we, instead, provided charitable or nonprofit licensees with formulas with which to calculate their compliance with the requirement of RCW 9.46.010.

The post-1/1/2008 rule change provides a consistent way to measure for the net income and cash flow requirement.

Post-1/1/2008 WAC 230-14-270 Additional retention requirements for some commercial stimulant licensees.

Pre-1/1/2008 WAC 230-30-072 Inventory control for punch boards and pull-tabs -- Retention requirements -- Audit adjustments.

We changed a "director approval" in the pre-1/1/2008 rule to a "staff approval" as we have done in other post-1/1/2008 rules. The pre-1/1/2008 rule required that the director enforce penalties on commercial stimulant licensees who fail to comply with all record-keeping requirements or who misstate gross gambling receipts by more than 1% during any calendar quarter. The director has reviewed this change and is comfortable with staff taking over enforcement of this requirement.

We have delegated many minor duties to staff in other sections of the post-1/1/2008 rules.

Post-1/1/2008 WAC 230-14-280 Records review of gross gambling receipts.

Pre-1/1/2008 WAC 230-30-072 Inventory control for punch boards and pull-tabs -- Retention requirements -- Audit adjustments.

We removed from the pre-1/1/2008 rule the exact number of randomly selected punch boards or pull-tab series we may select during a records review of gross gambling receipts.

We feel that naming the number in the WAC restricts our ability to enforce the post-1/1/2008 rule given different facts. For example, five boards or series might be too high for some inspections - such as the usual inspection module which special agents routinely perform - but the number might be too low for other situations in records review. We may need more than five to find a pattern of misstatements or recording errors.

Post-1/1/2008 WAC 230-14-290 Calculating cash over and cash short on the punch board and pull-tab monthly income summary.

Pre-1/1/2008 WAC 230-30-072 Inventory control for punch boards and pull-tabs -- Retention requirements -- Audit adjustments.

We added a definition of "reconcile" to the post-1/1/2008 rule because the term is used throughout the rules and we wish to be consistent in our meaning. This definition was also added to post-1/1/2008 rules in chapter 230-15 WAC, Card game rules and chapter 230-10 WAC, Bingo rules. It ensures that licensees and operators know what we mean when we require a reconciliation. We have had disagreements about the term in the past and want to avoid any in the future. It adds clarity and consistency with the post-1/1/2008 rules in all chapters.

Post-1/1/2008 WAC 230-14-295 Electronic facsimiles of Washington state identification stamps.

Pre-1/1/2008 WAC 230-08-010 Monthly records.

We corrected two small errors that had crept into the pre-1/1/2008 rule during the amendment and codification process:

1. The licensee does not have to put database information into the system by "scanning the stamp with a barcode reader." The data may be input using a keyboard and special type fonts.

2. The "interleaved two of five" barcode symbology we require is also not called "(USS-12/5)." The pre-1/1/2008 WAC incorrectly spells the barcode citation. In actuality, this high-density numeric-only barcode type is "(USS-ITF-2/5)." This barcode is used by the automatic identification and data capture (AIDC) industry, and the symbology is approved by the American National Standards Institute (ANSI) and the Association for Automatic Identification and Mobility (AIM).

To further clarify which barcoding system we require to create facsimiles of I.D. stamps, we also included in the post-1/1/2008 rule an example of what the barcode should look like.

Operators have been meeting the requirements using the correct software. The corrections will help future operators.

Reasons Supporting Proposal: To make our rules manual more user friendly. To make rules easier to find and understand.

Statutory Authority for Adoption: RCW 9.46.070.

Statute Being Implemented: Not applicable.

Name of Proponent: Washington state gambling commission, governmental.

Name of Agency Personnel Responsible for Drafting: Susan Arland, Rules Coordinator, Lacey, (360) 486-3466; Implementation: Rick Day, Director, Lacey, (360) 486-3446; and Enforcement: Mark Harris, Assistant Director, Lacey, (360) 486-3579.

No small business economic impact statement has been prepared under chapter 19.85 RCW. A small business economic impact statement has not been prepared pursuant to RCW 19.85.025, and/or the proposed rule change clarifies language of rules without changing the effect.

A cost-benefit analysis is not required under RCW 34.05.328. The Washington state gambling commission is not an agency that is statutorily required to prepare a cost-benefit analysis under RCW 34.05.328.

June 4, 2007

Susan Arland

Rules Coordinator

OTS-9759.1

Chapter 230-14 WAC

PUNCH BOARD AND PULL-TAB RULES

PUNCH BOARDS AND PULL-TABS
NEW SECTION
WAC 230-14-001   Defining "licensee," "licensees," "operator," and "operators."   (1) In this chapter, "licensee" and "licensees" mean the business holding the punch board and pull-tab license.

(2) "Operator" and "operators" mean licensees and those operating the gambling activity for the licensees, for example, those selling pull-tabs to players or putting out games for play.

[]


NEW SECTION
WAC 230-14-005   Defining "punch board."   A "punch board" means:

(1) A board with a number of openings of uniform size in which the manufacturer placed, at random, slips of paper or other substances (punches) imprinted with numbers or symbols; and

(2) A flare (face sheet) covers the openings and sets out the winning numbers or symbols and which prizes players may win. The punches have specific serial numbers assigned and printed on them; and

(3) After buying a punch, a player may select and remove the punch from the opening of the punch board, and, if the number on the selected punch matches the flare, the specified prize is awarded to the player.

[]


NEW SECTION
WAC 230-14-010   Defining "pull-tab."   A "pull-tab" means:

(1) A single folded tab that conceals number(s) or symbol(s) from view; or

(2) A banded tab that conceals number(s) or symbol(s) from view; or

(3) A card with the face covered by perforated window(s) or otherwise hidden to conceal number(s) or symbol(s) from view.

(4) Some of the number(s) in each series of pull-tabs have been selected in advance and at random as prize winners.

(5) After buying a pull-tab, a player opens the pull-tab and, if the numbers or symbols on the pull-tab match the flare, the player wins the prize.

[]


NEW SECTION
WAC 230-14-015   Rules apply to both punch boards and pull-tabs.   Commission rules that apply to operators of both punch boards and pull-tabs also apply to operators of only one of these activities.

[]


NEW SECTION
WAC 230-14-020   Washington state identification and inspection stamps to be called "I.D. stamps."   Because the agents, manufacturers, and other licensees have long referred to Washington state identification and inspection stamps as "I.D. stamps," we will use this abbreviated name for the stamps throughout the rules.

[]


NEW SECTION
WAC 230-14-025   Punch boards, pull-tabs, and pull-tab dispensers must meet all requirements.   Operators must not display or put out for play any punch board, pull-tab series, or pull-tab dispenser that does not comply with chapter 9.46 RCW and TITLE 230 WAC.

[]


NEW SECTION
WAC 230-14-030   Determining winners or location of winners in advance prohibited.   Manufacturers, distributors, operators, and representatives must not possess, display, sell, or otherwise furnish a pull-tab series when they know, or reasonably should have known, that:

(1) The location, or approximate location, of any of the winning pull-tabs can be determined in advance of opening by:

(a) Any pattern in the manufacture, assembly, or packaging of the tabs; or

(b) Any markings on the tabs or container; or

(c) The use of a light; or

(2) The winning tabs have not been distributed and mixed among all other tabs in the series.

[]


NEW SECTION
WAC 230-14-035   Defining "pull-tab series."   A "pull-tab series" means all the pull-tabs in a group produced by a manufacturer that offer a single set of prizes specified on the manufacturer's accompanying flare.

[]


NEW SECTION
WAC 230-14-040   Maximum number of pull-tabs in a series.   The maximum number of pull-tabs must be no more than:

(1) Ten thousand in a series; or

(2) Six thousand in a carry-over jackpot series; or

(3) Fifty thousand in progressive jackpot series.

[]


NEW SECTION
WAC 230-14-045   Authorized pull-tab dispensers.   (1) Authorized pull-tab dispensers must:

(a) Be made by a licensed manufacturer; and

(b) Conspicuously display a stamp, seal, or label identifying the manufacturer, city, and state where manufactured; and

(c) Be stamped with a serial number on the case.

(2) Perforated window type pull-tab dispensers must:

(a) Have a resettable counter visible to the customer indicating the number of pull-tabs left in the dispenser; or

(b) Be made so that players can:

(i) Clearly see each pull-tab in the dispenser, except for that area at the bottom, not more than one inch in height, covered for security or mechanical reasons; and

(ii) Estimate how many pull-tabs remain within the dispenser using permanent markings which divide the pull-tabs remaining into divisions of approximately twenty-five tabs.

(3) "Jar" or "banded" type pull-tab dispensers must:

(a) Have a resettable counter visible to the player indicating the number of jar or banded tabs left in the dispenser; or

(b) Be made so that players can clearly see all jar or banded tabs or jar tab bundles within the dispenser.

(4) Dispensers with bill acceptors or similar mechanisms must inform the player if they do not return change.

[]


NEW SECTION
WAC 230-14-050   Operating restrictions for punch boards and pull-tabs.   (1) Punch board and pull-tab operators must ensure no unauthorized person buys, plays, or sells punch boards or pull-tab series; and

(2) Licensees must:

(a) Not display or operate any punch board or pull-tab series which may have been marked, defaced, or tampered with in any way that could affect the chances of winning; and

(b) Not change a flare, except to:

(i) Delete prizes won; or

(ii) Correct inadvertently deleted prizes; or

(iii) Add a substitute flare; and

(c) Keep all records, reports, and receipts relating to punch boards or pull-tab series in play on the licensed premises as long as they are in play. They must make all records, reports, and receipts available on demand to law enforcement officers and us; and

(d) Not place out for further play any punch board or pull-tab series that they have permanently removed from play.

[]


NEW SECTION
WAC 230-14-055   Selling pull-tabs.   (1) No one may add pull-tabs to a series after the manufacturer has shipped that series.

(2) Pull-tab operators must:

(a) Thoroughly mix all pull-tabs in a series before placing them in a dispenser or clear container and offering them for sale. Operators may assemble pull-tabs into bundles with a sales price of up to twenty dollars as long as they thoroughly mix the bundles before they sell them; and

(b) Sell all pull-tabs from a dispenser we approved or a clear container. Pull-tabs sold from a container must be visible to players so players are able to estimate the number of chances remaining in the series; and

(c) Put out the entire pull-tab series for play. If using a spindle series, licensees may set the spindle on a nearby surface, for example, on the counter; and

(d) Not put a new pull-tab series in a dispenser or a clear container until they completely play out or permanently remove from play the series currently in the dispenser or container. If using a multiple-series dispenser, operators must offer each series independently.

(3) Once put out for play, operators must not remove pull-tabs from the dispenser or container until they are:

(a) Sold; or

(b) Permanently removed from play; or

(c) Removed by us or other law enforcement agencies inspecting the dispenser; or

(d) Temporarily removed during necessary repair or maintenance; or

(e) Removed to be held permanently for a player.

[]


NEW SECTION
WAC 230-14-060   Defining "flare."   A "flare" (also known as a "face sheet" for punch boards) means an advertising poster or card listing all the prizes, costs to play, number of pull-tabs, and required manufacturer information for pull-tab series.

[]


NEW SECTION
WAC 230-14-065   One flare per punch board or pull-tab series.   Punch board and pull-tab licensees must have in public view only one flare per punch board or pull-tab series. Flares must have a Washington state identification stamp number and series number on their face.

[]


NEW SECTION
WAC 230-14-070   Displaying flares.   (1) Punch board or pull-tab operators must place flares in plain view and in the vicinity of the pull-tab container or dispenser.

(2) If operators do not attach the flare directly to the container or dispenser, they must include a numerical or alphabetical reference directly on the flare and on the container or dispenser indicating which flare corresponds to which series.

[]


NEW SECTION
WAC 230-14-075   Substitute flares.   Manufacturers must make all flares. Operators or distributors must not alter flares, except that substitute flares are allowed if:

(1) The manufacturer, distributor, or operator who changes the original flare and attaches the substitute flare is responsible for ensuring that the substitute flare meets all other requirements for flares; and

(2) Manufacturers, distributors, or operators must permanently deface the original manufacturer's flare and attach the substitute flare to the original.

(3) Distributors or operators may apply manufacturer-produced substitute flares to punch boards and pull-tab series; and

(4) Distributors or operators must place substitute flares only on the upper face or the top of the punch board; and

(5) If distributors or operators convert flares from cash-only prizes to combined merchandise and cash prizes, they must offer at least fifty percent of the total value of the prizes in merchandise; and

(6) Distributors or operators may use substitute flares on punch boards and pull-tab series which offer merchandise or combination merchandise-cash prizes. These flares must use numbers, not symbols, to denote winners. Distributors or operators making substitute flares must:

(a) Select winning numbers from the manufacturer's original flare, or from the manufacturer's designated winning numbers on the punch board; and

(b) Assign the highest valued prize(s) to the lowest available winning number(s); and

(c) Assign the second highest valued prize(s) to the next lowest available winning number(s) and repeat that pattern until they have assigned all prizes based on their value to winning numbers. Licensed distributors may select winning numbers consecutively from the manufacturer's original flare; and

(7) Substitute flares must have the I.D. stamp number and series number permanently recorded in ink on its face.

[]


NEW SECTION
WAC 230-14-080   Prize limits and percentage of winners required.   Punch board or pull-tab operators must not possess, display, put out for play, sell, or otherwise transfer punch boards or pull-tab series that:

(1) Have a total payout of less than sixty percent of the total gross gambling receipts of the board or series; or

(2) Offer boards or series, except for progressive series or carry-over jackpots, with a single cash prize that is more than:

(a) Five hundred dollars in cash for pull-tabs under a dollar; or

(b) If we have approved it before, seven hundred fifty dollars for one dollar pull-tabs; or

(3) Offer a single merchandise prize that is more than seven hundred fifty dollars including markup; or

(4) Have a single pull-tab or punch with multiple winning combinations that are more than the prize limit; or

(5) Offer prizes for purchasing the last pull-tab or last punch (last sale) that are more than:

(a) One hundred dollars cash; or

(b) Merchandise that costs the licensee more than one hundred dollars; or

(c) The highest prize offered, whichever is less; or

(6) Series that have a key to any winning numbers or symbols.

[]


NEW SECTION
WAC 230-14-085   Calculating markup for merchandise prizes.   To calculate sixty percent of total gross for merchandise prizes, operators take the amount actually paid for the prize and add to it no more than fifty percent of that cost as markup. The total cost to the operator for the purchase of a prize must not exceed seven hundred fifty dollars.

[]


NEW SECTION
WAC 230-14-090   Controlling prizes.   Punch board and pull-tab operators must:

(1) Protect players from fraud and game manipulation.

(2) Award all prizes won.

(3) Not offer to pay cash instead of merchandise prizes.

(4) Not award additional punches or tabs as a prize. Prizes, however, may involve the opportunity to advance and win a larger prize on the same punch board or pull-tab series. Operators must award an immediate additional opportunity to advance called a bonus prize when offered in a bonus pull-tab series or a step-up prize when offered on a punch board.

[]


NEW SECTION
WAC 230-14-095   Displaying prizes.   Punch board and pull-tab operators must:

(1) Clearly represent cash prizes on the prize flare; and

(2) Display merchandise prizes:

(a) In plain view and in the immediate vicinity of the punch board or pull-tab series. However, operators may wrap merchandise prizes for games that offer "surprise" prizes so players are unable to identify the prize until opened; or

(b) Elsewhere on the premises if size or space constraints do not allow it to be displayed in the immediate vicinity, as long as operators note a specific reference to the prize on the flare; or

(c) Use an accurate description or photograph of the prize in plain view on, or immediately adjacent to, the flare if operators cannot display the prize merchandise on the premises; and

(3) Meet all the requirements of subsections (1) and (2) of this section for combination cash and merchandise prizes.

[]


NEW SECTION
WAC 230-14-100   Removing prizes from flares.   (1) After receiving a winning punch or pull-tab for more than twenty dollars or merchandise with a retail value of more than twenty dollars, operators must immediately permanently and conspicuously delete all reference to the prize from the flare and from any other list, sign, or notice. Operators then must pay or deliver the prize to the winner.

(2) On step-up punch boards and bonus pull-tab games, once all chances to win in a section of the flare are won, operators must delete all references to prizes.

(3) Operators may correct an inadvertently deleted prize by noting on the flare that such prize is still available. When they actually award the prize, operators must permanently and conspicuously delete the reference.

(4) If operators elect to delete prizes of less than twenty dollars from flares, they must continue to do so until they remove the games from play.

[]


NEW SECTION
WAC 230-14-105   Paying prizes not deleted from flares.   When a player buys out a punch board or pull-tab series, operators must award the player all prizes not deleted from the flare that were required to be deleted, even if the operator failed to delete the prize from the flare when originally won.

[]


NEW SECTION
WAC 230-14-110   Recording winners.   When punch board or pull-tab players win more than twenty dollars or merchandise prizes with a retail value over twenty dollars, operators must make a record by:

(1) Having winners print their name and date of birth, in ink, on the side of the winning punch or tab opposite the winning symbol(s) and verifying the winner's identity and recording the current date and initialing the winning punch or tab; or

(2) Recording the required information on a sheet of paper at least three inches by five inches and stapling the winning tab or punch to the paper if the pull-tab or punch is constructed or printed so that recording the information required in a legible manner is not possible.

[]


NEW SECTION
WAC 230-14-115   Defacing winning punches or pull-tabs.   Within twenty-four hours after a winning punch or pull-tab over twenty dollars is presented for payment, licensees must permanently deface the pull-tab or punch so that it cannot be presented again for payment.

[]


NEW SECTION
WAC 230-14-120   Permanently removing punch boards or pull-tab series.   Operators may permanently reserve a series for a player who leaves the premises, but intends to return and play the game. The operator must:

(1) Prominently post house rules that are clear in meaning and with criteria for reserving a series and the length of time players may reserve a series; and

(2) Ensure that the player meets the criteria in the house rules; and

(3) Contain all of the reserved series in a secure manner, clearly identifying it as permanently reserved, and store it in the immediate vicinity of the pull-tab area; and

(4) Not reserve a board or series for a player without play for more than seven days and not be more than a total reserve time of fourteen days; and

(5) Not have more than twenty-five boards or series permanently reserved for players at one time; and

(6) Maintain adequate accounting records showing the status of all reserved boards or series; and

(7) Not place reserved boards or series out for public play after the reserving player finishes playing them.

[]


NEW SECTION
WAC 230-14-125   Temporarily removing punch boards or pull-tab series from play.   Operators may temporarily remove punch boards or pull-tab series from play and return them to play later. Operators must clearly identify the punch board or pull-tab series as reserved and prominently post house rules regarding hours of play or other conditions affecting play. Operators may temporarily remove punch boards or pull-tab series if they are:

(1) Reserving a board or series for a player, as long as the operator ensures that the player meets the criteria in the house rules; or

(2) Repairing or maintaining the pull-tab dispenser or container; or

(3) Reserving a punch board or pull-tab series for play during certain hours of operation, for example, a "happy hour" game; or

(4) Complying with the game removal requirements of WAC 230-14-050.

[]


NEW SECTION
WAC 230-14-130   Defining "happy hour punch board or pull-tab games."   (1) A "happy hour punch board or pull-tab game" means a series where licensees offer additional prizes to winners during a selected period.

(2) Licensees may increase advertised prizes or add cash or merchandise prizes to punch board or pull-tab series if licensees:

(a) Do not change the manufacturer's flare; and

(b) Disclose to players by permanently attaching an additional sign or notice to the manufacturer's flare:

(i) The requirements to qualify for prizes; and

(ii) The prizes offered; and

(c) Add the increased or additional prizes to every prize within a tier or section of the flare; and

(d) Staple or otherwise permanently attach documentation about all additional prizes to the winning punch or pull-tab. Minimum documentation must include a description of the prize and the name of the winner.

(3) Charitable or nonprofit licensees must only offer one happy hour punch board or pull-tab series at any one time.

[]


NEW SECTION
WAC 230-14-135   Operating spindle, banded, or "jar" type pull-tabs which award only merchandise prizes.   (1) Pull-tab series which award only merchandise prizes valued at no more than twenty dollars may use formats with predesignated pull-tabs where:

(a) Some pull-tabs are free; or

(b) Players are reimbursed for the cost of the pull-tabs.

(2) Flares for spindle-type pull-tab series must indicate the total number of pull-tabs and the total number of pull-tabs designated as free or reimbursable.

(3) Free or reimbursable pull-tabs do not constitute prizes. Operators must not include as revenue money collected and later reimbursed when determining gross gambling receipts.

[]

SEAL CARD PULL-TAB SERIES
NEW SECTION
WAC 230-14-140   Defining "seal card pull-tab series."   "Seal card pull-tab series" means a pull-tab series that includes a predetermined number of pull-tabs which allow players to advance to the "seal card round."

[]


NEW SECTION
WAC 230-14-145   Defining "seal card round."   (1) "Seal card round" means a secondary element of chance game linked with the pull-tab series.

(2) Seals on the pull-tab flare conceal prizes for the secondary element of chance game.

(3) Winners who advance to the seal card round place their names on the list that matches the winning pull-tab number or symbol.

(4) Players win the prizes behind the seals when the seal card round ends and the operator opens all the seals.

[]


NEW SECTION
WAC 230-14-150   Awarding seal card pull-tab winners.   (1) Pull-tab operators using seal card pull-tabs series must:

(a) Award seal card round prizes for all seal card pull-tab series placed out for play; and

(b) Establish and fully disclose the method of selecting alternate winners before placing a game out for play.

(2) When players buy pull-tabs that allow them to enter the seal card round, the operator must:

(a) Enter, or allow the winners to enter, their names on the flare where indicated by the number or symbol on the pull-tab. Players must then turn in their pull-tabs to the operator; and

(b) Gather player contact information and keep it with the records of the series during the record retention period; and

(c) Wait until the series plays out before removing it from play, unless the operator elects to award the seal card round prizes without all pull-tabs being purchased.

(3) After the series is played out, or when they begin to award prizes, operators must:

(a) Contact the seal card round winner within two business days of the end of the series; and

(b) Allow the winner fourteen days after being contacted to redeem their prize; and

(c) Keep all series on premises and available for public inspection for a period of fourteen days after they pull them from play; and

(d) Keep the series until they name a winner for the game if they do not locate the seal card round winner within fourteen days.

(4) If seal card round winners do not redeem their prizes within fourteen days, licensees must select alternate winners.

(5) Licensees must not use substitute flares, bonus pull-tab series, or carry-over jackpots with seal card pull-tab series.

[]

PROGRESSIVE JACKPOT PULL-TAB SERIES
NEW SECTION
WAC 230-14-155   Definitions for "progressive jackpot pull-tab series."   (1) "Progressive jackpot pull-tab series" means a pull-tab series in which operators award a progressive jackpot prize to the player who presents the winning pull-tab.

(2) The "progressive jackpot" means the starting jackpot prize, the accrued jackpot prize for that specific series, plus any accrued jackpot prize carried over from previous series.

(3) "Starting jackpot prize" means the base or minimum amount of the progressive jackpot for each series before the operator adds any money based on the jackpot accrual rate.

(4) "Accrued jackpot prize" means the amount of all additions to the progressive jackpot before the progressive jackpot is won or the operator removes the series from play.

(5) "Jackpot accrual rate" means the rate at which a progressive jackpot increases for each pull-tab sold. The rate may be a percentage of gross gambling receipts or a dollar value based on the price of a single pull-tab.

(6) "Instant winners" means all prizes available from a progressive jackpot pull-tab series, except for the progressive jackpot.

(7) "Bank system" means a network of pull-tab dispensers offering progressive jackpot pull-tab series connected by a computer. The computer determines the total gross gambling receipts all the dispensers on the network receive and calculates the amount of the progressive jackpot on the networked dispensers.

[]


NEW SECTION
WAC 230-14-160   Progressive jackpot dispensers with a bank system.   (1) Operators may have more than one pull-tab dispenser for a series operating at one time.

(2) Operators may have more than one bank system operating at one time, but one bank system must not have more than ten pull-tab dispensers.

(3) In a bank system, progressive jackpot pull-tab dispensers must be:

(a) Located in close physical proximity on the business premises, so that players may observe all remaining pull-tabs in a series; and

(b) Linked to a computer system which records all sales and the accrual of the progressive jackpot.

[]


NEW SECTION
WAC 230-14-165   Additional operating requirements for progressive jackpot pull-tab series.   Operators must conduct progressive jackpot pull-tab series in the same way as other pull-tab series and must follow these requirements:

(1) An owner or licensed commercial or charitable or nonprofit gambling manager must be on the premises at all times when progressive jackpot pull-tab series are operated; and

(2) Only owners and licensed individuals may have access to progressive jackpot pull-tab series and they must store the series in secured locations; and

(3) Licensees must have sufficient funds available to pay all prizes on redemption of winning tabs. Failure to have sufficient funds available is prima facie evidence of defrauding the public; and

(4) The current progressive jackpot total must be clearly displayed near the bank of machines at all times during the sale of progressive pull-tabs; and

(5) Operators must prominently display one flare near the bank of machines; and

(6) Operators must not use:

(a) Substitute flares; or

(b) Merchandise prizes; or

(c) Last sale prizes; and

(7) Operators must disclose the rules for playing out a series or carrying over accrued prizes.

[]


NEW SECTION
WAC 230-14-170   Prizes in progressive jackpot pull-tab series.   Manufacturers and operators must offer prizes for progressive jackpot pull-tab series that follow these requirements:

(1) Instant winners must be at least forty percent of total gross gambling receipts available from the series; and

(2) The starting jackpot must, at least, equal the value of the highest instant winner; and

(3) Operators must set the minimum jackpot accrual rate to generate an accrued jackpot prize of at least sixty percent of the total gross gambling receipts available from the series when added to the starting jackpot prize and instant winners; and

(4) The manufacturer must determine the starting jackpot prize and corresponding jackpot accrual rate needed to meet the sixty percent payout requirement. Manufacturers must include this information in the package with each series; and

(5) The maximum contribution to a progressive jackpot for each individual progressive pull-tab series must be five thousand dollars. The contribution amount excludes portions carried over from previous series.

[]


NEW SECTION
WAC 230-14-175   Removing progressive jackpot pull-tab series from play.   Operators must not remove a progressive jackpot pull-tab series from play before the progressive jackpot is won. However, operators may remove a series from play if they:

(1) Remove the series before the beginning or at the end of any business day; and

(2) Carry over the accrued jackpot prize from the series and any previously carried over accrued jackpot prize to a new series within twenty-four hours; and

(3) Add the accrued jackpot prize to the starting jackpot amount for the new series when they place it out for play. The amount of the jackpot must not be decreased.

[]


NEW SECTION
WAC 230-14-180   Paying out prizes and defacing tabs in progressive jackpot pull-tab series.   Operators must pay out progressive jackpot pull-tab prizes in the same way required for all other pull-tabs and must follow these requirements:

(1) Operators must pay at least the starting jackpot portion of the progressive jackpot with a check. They must record the check number along with all the information required in WAC 230-14-065; and

(2) Operators must immediately deface all jackpot winning tabs when received instead of within twenty-four hours.

[]


NEW SECTION
WAC 230-14-185   Additional recordkeeping for progressive jackpot pull-tab series.   In addition to other pull-tab recordkeeping requirements, operators must:

(1) Record progressive jackpot series on a separate monthly record in the format we require; and

(2) Retain progressive jackpot winning tabs, winner information, and the flares for one year from the date they removed the series from play.

[]

EVENT PULL-TAB SERIES
NEW SECTION
WAC 230-14-190   Defining "event pull-tab series" and "event round."   Only charitable or nonprofit bingo operators may use event pull-tab series:

(1) "Event pull-tab series" means a pull-tab series that includes a predetermined number of pull-tabs which allow a player to advance to the event round.

(2) "Event round" means a game where the numbers drawn in a bingo game must match pull-tab numbers to determine winners. The winning numbers must be between numbers 1 through 75.

[]


NEW SECTION
WAC 230-14-195   Operating requirements for event pull-tabs.   When using event pull-tab series, charitable or nonprofit bingo operators must:

(1) Offer and complete event pull-tabs within one bingo session; and

(2) Disclose when the event round will take place before putting an event pull-tab series into play; and

(3) Offer event pull-tabs for sale until immediately before the event round unless the series sells out; and

(4) Have a licensed manager present at all times an event pull-tab series is in play, including sales of tabs and selection of winners; and

(5) Allow floor workers to sell event pull-tabs (for example, from aprons). Only event pull-tabs may be sold in this way; and

(6) Maintain accounting records in the format we require to track the event pull-tabs issued to each floor worker; and

(7) Meet all the requirements for carry-over jackpots if the event pull-tab series offer a carry-over jackpot; and

(8) Not use substitute flares or bonus pull-tab series with event pull-tab series.

[]

BONUS PULL-TAB SERIES
NEW SECTION
WAC 230-14-200   Defining "bonus pull-tab series."   "Bonus pull-tab series" means pull-tab series that include a predetermined number of pull-tabs that allow players the opportunity to advance to a bonus section to determine the prize.

[]


NEW SECTION
WAC 230-14-205   Operating requirements for bonus pull-tab series.   Operators of bonus pull-tab series must ensure that:

(1) In addition to all other information required for flares, each flare clearly states:

(a) The number of chances available to advance and win a larger prize; and

(b) The number of winning tabs at each prize level; and

(2) The series uses only guaranteed or minimum prizes in calculating the sixty percent payout required; and

(3) The series does not use:

(a) Substitute flares; or

(b) Merchandise prizes; or

(c) Last sale prizes.

[]


NEW SECTION
WAC 230-14-210   Flares for bonus and step-up prizes.   Flares for punch boards or pull-tab series offering bonus or step-up prizes must clearly indicate how players may win bonus or step-up prizes, including the amount of the prizes. Bonus or step-up prizes must not be less than the prize for the initial winning punch or pull-tab.

[]

CARRY-OVER JACKPOT PULL-TAB SERIES
NEW SECTION
WAC 230-14-215   Defining "carry-over jackpot pull-tab series" and "contribution amount."   (1) "Carry-over jackpot" means a prize pool of added contributions from carry-over pull-tab series which pass (carry-over) to another carry-over pull-tab series if not won.

(2) "Contribution amount" means the amount from each series added to the carry-over jackpot.

[]


NEW SECTION
WAC 230-14-220   Prize limits for carry-over jackpot pull-tab series.   Operators may use pull-tab series which include carry-over jackpots. Operators must use the following calculations for prizes and prize payouts for carry-over jackpots:

(1) Guaranteed prizes must be sixty percent or more of gross gambling receipts available from the pull-tab series. "Guaranteed prizes" means all prizes available, excluding the contribution amount or carry-over jackpot; and

(2) The manufacturer determines the contribution amount and the method of play and discloses both on the flare; and

(3) The contribution amount for each series must not be more than five hundred dollars; and

(4) An accumulated carry-over jackpot must not be more than two thousand dollars; and

(5) If the carry-over jackpot is awarded, the sum of the advance-level prize and the carry-over jackpot prize combined must not be more than two thousand dollars; and

(6) If the operator carries over the jackpot to a new series, the total of the advance-level prize and the consolation prize must not be more than five hundred dollars.

[]


NEW SECTION
WAC 230-14-225   Sufficient funds for carry-over jackpot pull-tab prizes.   We consider it prima facie evidence of defrauding players if the licensee:

(1) Fails to have sufficient funds available to pay a carry-over jackpot; or

(2) Attempts to use carry-over jackpots for any purpose other than paying winners.

[]


NEW SECTION
WAC 230-14-230   Transferring a carry-over jackpot to another game.   (1) If a licensee wants to remove a series from play and the carry-over jackpot has not been won, the operator must carry over the jackpot to a new series within one business day.

(2) Operators must maintain a separate record creating an audit trail for carry-over jackpots in the format we require.

[]


NEW SECTION
WAC 230-14-235   Replacing played out carry-over jackpot series.   If no tabs remain to win the carry-over jackpot but tabs to win other prizes still remain, operators must remove the series from play and replace it with a new series within seven business days.

[]


NEW SECTION
WAC 230-14-240   Distributing carry-over pull-tab jackpots.   If businesses stop conducting gambling activities, they must:

(1) Transfer the carry-over jackpot to the new owners who bought the business and who have a gambling license. The new licensee must operate the carry-over jackpot game until they award the prize; or

(2) Award the carry-over jackpot to a player by playing out the game before closing; or

(3) Give the carry-over jackpot to the Washington state council on problem gambling; or

(4) Give the carry-over jackpot to a charitable or nonprofit organization we license.

[]


NEW SECTION
WAC 230-14-245   Retaining carry-over jackpot pull-tab series.   Operators offering carry-over jackpots must keep all pull-tab series that were used for a specific carry-over jackpot together.

[]


NEW SECTION
WAC 230-14-250   Recording carry-over jackpots on a cash basis.   (1) Operators must record carry-over jackpots on a cash basis. "Cash basis" means operators do not record carry-over jackpot contributions until the prize is awarded.

(2) However, punch board and pull-tab licensees who also hold a Class F or above bingo license may record carry-over jackpot contributions on their monthly records if they:

(a) Record contribution amounts, up to the jackpot maximum, as prizes paid on the monthly records; and

(b) When the jackpot is awarded, record only amounts not previously accrued as prizes paid; and

(c) Play no more than five carry-over jackpot series at once; and

(d) Maintain a proper audit trail and adequate security over the funds if the licensee does not deposit the contributions with the net receipts.

[]

CHARITABLE OR NONPROFIT ORGANIZATIONS OPERATING PUNCH BOARDS AND PULL-TABS
NEW SECTION
WAC 230-14-255   Net income and cash flow requirements when operating punch boards and pull-tabs.   Charitable or nonprofit punch board and pull-tab licensees must:

(1) When not licensed to operate bingo, ensure that they do not pay excessive expenses and that net income from punch boards and pull-tabs is more than zero when measured over the annual license period; or

(2) When licensed to operate bingo, meet the cash flow requirements.

[]

RECORDKEEPING FOR PUNCH BOARDS AND PULL-TABS
NEW SECTION
WAC 230-14-260   Inventory control.   (1) Punch board and pull-tab operators must control and account for each punch board and pull-tab series they obtain. Operators must:

(a) Enter the Washington state (I.D. stamp) stamp numbers for the series in all records; and

(b) Record each pull-tab dispenser they purchase.

(2) Distributors must record every purchase of punch boards or pull-tabs on an invoice. Operators must use this record to account for each series between the time they purchase it and the time they remove it from play. Invoices must include space for the operator to attach:

(a) The I.D. stamp numbers for each board or series; and

(b) The date they placed the punch board or pull-tab series out for play.

(3) When operators receive punch boards or pull-tab series, they must ensure that the manufacturer or distributor recorded all required data by comparing the Washington state identification stamp number attached to each punch board and pull-tab series to the number recorded on the purchase invoice.

(4) Operators may use a separate computerized inventory record as long as they:

(a) Use an I.D. stamp or print a computer generated facsimile of the stamp number on the inventory record; and

(b) Record all other required information.

[]


NEW SECTION
WAC 230-14-265   Retention requirements for punch boards and pull-tab series.   (1) Punch board and pull-tab operators must keep all punch boards or pull-tab series removed from play, including, at least:

(a) All prize flares; and

(b) All unplayed tabs; and

(c) All winning punches or tabs.

(2) Operators must make the items in subsection (1) of this section available on the licensed premises for us, local law enforcement, or local tax agencies to inspect.

(3) If stored off premises, operators must produce the game for inspection on demand.

(4) Operators must retain punch board or pull-tab series removed from play for:

(a) Charitable or nonprofit operators - Four months following the last day of the month in which the board or series was removed from play; and

(b) Commercial operators -

(i) Two months following the last day of the month in which they removed the board or series from play; and

(ii) Three months following the day they removed the board or series from play for winning punches or pull-tabs over twenty dollars. Operators must also retain the flare for these games; and

(c) Carry-over jackpot series - For four months after the last day of the month in which the carry-over jackpot was won; and

(d) Progressive pull-tab series - For one year. After the retention period, operators must destroy unsold progressive pull-tab series tabs in such a way that no one may find and use unopened winning tabs later.

[]


NEW SECTION
WAC 230-14-270   Additional retention requirements for some commercial stimulant licensees.   (1) Punch board and pull-tab licensees who fail to comply with all recordkeeping requirements or who misstate gross gambling receipts by more than one percent during any calendar quarter will receive a letter from us requiring them to comply with additional record retention limits.

(2) Licensees receiving the letter must retain all punch boards and pull-tab series for at least four months following the last day of the month during which they were removed from play. Specially authorized games like carry-over jackpots and progressive pull-tab series may require longer retention periods.

(3) After one year, licensees may petition us to remove the increased retention requirement. The petition must include documentation of the steps taken to correct recordkeeping errors or misstatements.

(4) To compute gross gambling receipts to determine compliance with recording accuracy requirements, see WAC 230-14-255.

[]


NEW SECTION
WAC 230-14-275   Returning punch boards and pull-tab series to the distributor or manufacturer.   (1) If punch board and pull-tab operators return a punch board or pull-tab series for any reason, they must write the date, the invoice or credit memo number, and "returned" on the original purchase invoice or inventory record.

(2) Operators must record each punch board or pull-tab series returned on their monthly record and keep a copy of the quality control report for the retention period required by WAC 230-14-240.

[]


NEW SECTION
WAC 230-14-280   Records review of gross gambling receipts.   To meet the gross gambling receipts and license class requirements, punch boards and pull-tab licensees must adjust gross gambling receipts from the operation to comply with commission records review findings.

Licensees must perform the following calculations:

(1) For unrecorded punch boards and pull-tab series -


Unadjusted gross gambling receipts
+
Unrecorded punch boards or pull-tab series
(total number of chances multiplied by price)
Adjusted gross gambling receipts*

To account for any unrecorded punch boards and pull-tab series, licensees add the unrecorded punch board or pull-tab series to the unadjusted gross gambling receipts. To get the total of unrecorded punch boards or pull-tab series, licensees multiply the total number of chances available by the price of a single chance to determine the maximum amount that could be generated from the punch board or pull-tab series.

*Licensees must apply this figure to the records for the month in which they purchased the punch board or pull-tab series.

(2) For recording errors -


Unadjusted gross gambling receipts
+/
Adjustment factor

(amount of sample group divided by recorded amount for the licensee)

Adjusted gross gambling receipts for the quarter and the three quarters preceding**

To adjust gross gambling receipts for the results of our records review, licensees divide the amount we determined for a randomly selected sample of punch boards or pull-tab series by the recorded amount for them.

**Licensees apply this figure to the total recorded gross gambling receipts for the calendar quarter from which we took the sample and to the three quarters immediately before.

[]


NEW SECTION
WAC 230-14-285   Monthly income summary.   (1) Punch board and pull-tab licensees must prepare a detailed monthly income summary for punch board and pull-tab series removed from play in the format we require either manually or electronically.

(2) Licensees may store punch board and pull-tab monthly records electronically if they:

(a) Retain all original input control documents supporting the electronic record; and

(b) Generate a monthly paper income summary that organizes the electronic record into the format we require.

(c) Ensure that the income summary:

(i) Does not hinder our review of records; and

(ii) Is available for review no later than thirty days following the end of the month; and

(iii) Is available within three days of a request by us, local law enforcement, or local tax agencies.

[]


NEW SECTION
WAC 230-14-290   Calculating cash over and cash short on the punch board and pull-tab monthly income summary.   (1) When preparing their monthly income summary, operators must determine cash over or cash short by:

(a) Subtracting actual cash from net gambling receipts for punch boards and pull-tabs which award cash prizes; and

(b) Subtracting actual cash from gross gambling receipts for punch boards and pull-tabs which award merchandise prizes.

(2) When operators sell more than one series of pull-tabs from a single dispenser and the dispenser has meters to record the number of tabs dispensed from each series, operators may compute the actual cash using the meter readings. If operators use this method, they must:

(a) Play out all series in each dispenser at least once each calendar quarter; and

(b) Reconcile the total cash removed from the dispenser to the total tabs sold from that dispenser to calculate the combined cash over or cash short for all series played from each dispenser during the period. "Reconcile" means the operator must compare the two balances, resolve any differences, and document the comparison and the differences in writing.

[]


NEW SECTION
WAC 230-14-295   Electronic facsimiles of I.D. stamps.   Punch board and pull-tab licensees may use a printer interfaced with a computer to create an electronic facsimile of the I.D. stamps, as long as licensees:

(1) Input the I.D. stamp number into the computer; and

(2) Print records on white paper. Facsimiles of the I.D. stamp must be at least one-quarter inch in height with a "quiet zone" of at least one-quarter inch on each side of the bar code; and

(3) Code "interleaved two of five" (USS-ITF-2/5) bar code facsimiles. This is a high-density numeric-only barcode type used in the Automatic Identification and Data Capture industry. It is also called American National Standards Institute/Association for Automatic Identification and Mobility (ANSI/AIM) ITF 2/5. The bar code must have a readability rate of at least ninety-nine percent with a maximum of three passes with our bar code reading equipment. An example is below:

(4) Licensees are responsible for the accuracy of printouts and that bar codes are electronically readable.

[]

Washington State Code Reviser's Office