Senate Bill 2176

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    Florida Senate - 1999                                  SB 2176

    By Senator Silver





    38-1356A-99                                             See HB

  1                      A bill to be entitled

  2         An act relating to video lotteries for

  3         educational facilities; amending s. 24.101,

  4         F.S.; redesignating chapter 24 of the Florida

  5         Statutes as the "Florida Public Education

  6         Lottery Chapter"; amending ss. 24.102, 24.108,

  7         24.111, 24.118, and 24.120, F.S., to conform;

  8         making technical corrections within the

  9         chapter; amending s. 24.103, F.S., relating to

10         definitions; defining the terms "video lottery

11         game," "video lottery terminal vendor," "net

12         terminal income," and "video lottery retailer";

13         amending s. 24.105, F.S.; providing duties of

14         the Department of the Lottery relating to

15         establishment and operation of video lottery

16         games; providing specific rulemaking authority;

17         amending s. 24.1055, F.S.; correcting a

18         reference; prohibiting participation of minors

19         in video lottery games; requiring warning

20         signs; providing criminal penalties; creating

21         s. 24.1121, F.S.; providing requirements for

22         video lottery games and retailers; providing

23         suspension powers to the Department of the

24         Lottery; providing for fines; providing for

25         enforcement of suspension orders or fines in

26         circuit court; providing for allocation of net

27         terminal income; providing for distribution of

28         proceeds; providing for transfer of funds into

29         the Public Education Capital Outlay and Debt

30         Service Trust Fund; prohibiting manipulation or

31         attempted manipulation of lottery games or

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         terminals; providing criminal penalties;

  2         providing for payment of prizes; prohibiting

  3         isolation of video lottery terminals in

  4         pari-mutuel facilities; creating s. 24.1122,

  5         F.S.; providing for licensure of video lottery

  6         terminal vendors; creating s. 24.1123, F.S.;

  7         prohibiting certain zoning changes by local

  8         governments; creating s. 24.1124, F.S.,

  9         relating to video lottery terminals; requiring

10         that such terminals be approved by the

11         department; providing technical specifications;

12         creating s. 24.1125, F.S.; providing for

13         training and certification of video lottery

14         terminal service employees; providing

15         rulemaking authority; amending s. 24.117, F.S.;

16         prohibiting knowingly permitting use of video

17         lottery terminals by minors; providing criminal

18         penalties; amending s. 24.122, F.S.;

19         prohibiting state and local taxation of the

20         installation, rental, or use of video lottery

21         terminals; amending s. 212.02, F.S.; clarifying

22         that video lottery terminals are not

23         coin-operated amusement machines for the

24         purpose of taxation; creating s. 550.26315,

25         F.S., relating to the administration of the

26         Video Lottery Purse Trust Fund; providing for

27         distribution of proceeds; requiring certain

28         proceeds to be used as additional purses,

29         awards, or compensation; providing for transfer

30         of certain proceeds to the Video Lottery

31         Thoroughbred Trust Fund; providing rulemaking

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         authority; creating s. 550.26325, F.S.,

  2         relating to the distribution of funds from the

  3         Video Lottery Thoroughbred Trust Fund;

  4         requiring certain uses of distributed funds;

  5         providing for periodic calculations for the

  6         distribution of proceeds in future years;

  7         amending s. 550.2625, F.S.; requiring that the

  8         Division of Pari-Mutuel Wagering of the

  9         Department of Business and Professional

10         Regulation adopt rules regarding the

11         distribution of certain awards and funds,

12         including video lottery proceeds, received for

13         distribution to thoroughbred owners and

14         breeders by pari-mutuel permitholders or by

15         horsemen's or breeders' associations; providing

16         administrative fines for underpaying purses or

17         awards; requiring periodic audited accountings

18         by permitholders and by horsemen's and

19         breeders' associations; creating s. 550.401,

20         F.S.; prohibiting the cancellation of certain

21         contracts by greyhound racing tracks; amending

22         s. 550.615, F.S.; providing that pari-mutuel

23         facilities are not required to broadcast their

24         intertrack signals to other facilities located

25         in the same county; requiring approval of

26         certain intertrack contracts; requiring written

27         consent of certain permitholders relating to

28         intertrack wagering; amending s. 550.6305,

29         F.S.; providing that pari-mutuel facilities are

30         not required to broadcast their intertrack

31         signals to other facilities located in the same

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         county; repealing additional requirements and

  2         authority provided in relation to intertrack

  3         wagering on nighttime thoroughbred races;

  4         amending s. 565.02, F.S.; providing that

  5         pari-mutuel facilities may be licensed to sell

  6         alcoholic beverages when conducting video

  7         lottery games; providing a contingent effective

  8         date.

  9

10         WHEREAS, the need for additional classroom construction

11  both now and in the future will require an additional source

12  of revenue to meet that need, and

13         WHEREAS, the Florida Lottery was authorized by the

14  citizens of the State of Florida in the Florida Constitution

15  and was enacted by the Legislature of the State of Florida, in

16  part, to provide for the enhancement of educational

17  opportunities in this state, and

18         WHEREAS, the authorization of video lottery games as an

19  expansion of the state lottery would provide additional

20  funding that could, and should, be dedicated to addressing the

21  unmet need for construction, renovation, and maintenance of

22  educational facilities in this state, and

23         WHEREAS, the citizens of this state have overwhelmingly

24  rejected the establishment of casinos in this state, and

25         WHEREAS, the pari-mutuel industry of Florida has

26  provided employment, entertainment, and financial resources to

27  the State of Florida for over 75 years, and has been a vital

28  part of Florida's tourism industry, and

29         WHEREAS, the pari-mutuel industry permitholders are

30  strictly licensed and regulated by the State of Florida, and

31

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  have established a lengthy record of complying with the laws

  2  of this state, and

  3         WHEREAS, the amount that may be wagered at a licensed

  4  facility has been unlimited, and

  5         WHEREAS, there are a limited number of pari-mutuel

  6  permits in Florida, and

  7         WHEREAS, the Legislature has determined that permitting

  8  video lottery terminals in licensed pari-mutuel facilities

  9  will provide needed revenue for the construction of

10  educational facilities, enhance the economic vitality of the

11  pari-mutuel industry and the economic vitality of the State as

12  a whole, and ensure the protection of the public interests,

13  NOW, THEREFORE,

14

15  Be It Enacted by the Legislature of the State of Florida:

16

17         Section 1.  Section 24.101, Florida Statutes, is

18  amended to read:

19         24.101  Short title.--This chapter act may be cited as

20  the "Florida Public Education Lottery Chapter Act."

21         Section 2.  Section 24.102, Florida Statutes, is

22  amended to read:

23         24.102  Purpose and intent.--

24         (1)  The purpose of this chapter act is to implement s.

25  15, Art. X of the State Constitution in a manner that enables

26  the people of the state to benefit from significant additional

27  moneys for education and also enables the people of the state

28  to play the best lottery games available.

29         (2)  The intent of the Legislature is:

30         (a)  That the net proceeds of lottery games conducted

31  pursuant to this chapter act be used to support improvements

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  in public education and that such proceeds not be used as a

  2  substitute for existing resources for public education.

  3         (b)  That the lottery games be operated by a department

  4  of state government that functions as much as possible in the

  5  manner of an entrepreneurial business enterprise.  The

  6  Legislature recognizes that the operation of a lottery is a

  7  unique activity for state government and that structures and

  8  procedures appropriate to the performance of other

  9  governmental functions are not necessarily appropriate to the

10  operation of a state lottery.

11         (c)  That the lottery games be operated by a

12  self-supporting, revenue-producing department.

13         (d)  That the department be accountable to the

14  Legislature and the people of the state through a system of

15  audits and reports and through compliance with financial

16  disclosure, open meetings, and public records laws.

17         Section 3.  Section 24.103, Florida Statutes, is

18  amended to read:

19         24.103  Definitions.--As used in this chapter act:

20         (1)  "Department" means the Department of the Lottery.

21         (2)  "Secretary" means the secretary of the department.

22         (3)  "Commission" means the State Lottery Commission.

23         (4)  "Person" means any individual, firm, association,

24  joint adventure, partnership, estate, trust, syndicate,

25  fiduciary, corporation, or other group or combination and

26  shall include any agency or political subdivision of the

27  state.

28         (5)  "Major procurement" means a procurement for a

29  contract for the printing of tickets for use in any lottery

30  game, consultation services for the startup of the lottery,

31  any goods or services involving the official recording for

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  lottery game play purposes of a player's selections in any

  2  lottery game involving player selections, any goods or

  3  services involving the receiving of a player's selection

  4  directly from a player in any lottery game involving player

  5  selections, any goods or services involving the drawing,

  6  determination, or generation of winners in any lottery game,

  7  the security report services provided for in this chapter act,

  8  or any goods and services relating to marketing and promotion

  9  which exceed a value of $25,000.

10         (6)  "Retailer" means a person who sells lottery

11  tickets on behalf of the department pursuant to a contract.

12         (7)  "Vendor" means a person who provides or proposes

13  to provide goods or services to the department, but does not

14  include an employee of the department, a retailer, or a state

15  agency.

16         (8)  "Video lottery game" means an electronically

17  simulated game involving any element of chance that is played

18  on a video lottery terminal that, upon insertion of cash,

19  tokens, credits, or voucher, is available to play or simulate

20  a lottery-type game, including, but not limited to, line-up

21  games utilizing a video display and microprocessors, and in

22  which, by means of an element of chance, the player may

23  receive credits that can be redeemed for cash. "Video lottery

24  game" also means an electronically simulated game involving

25  elements of chance and skill that is played on a video lottery

26  terminal that, upon insertion of cash, tokens, credits, or

27  voucher, is available to play or simulate the play of

28  traditional card games including, but not limited to, video

29  poker, utilizing a cathode ray tube or video display screen

30  and microprocessors, and in which the player may win credits

31  that can be redeemed for cash. "Video lottery game" also

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  includes a progressive game, which is any game in which a

  2  jackpot grows and accumulates as it is being played on a video

  3  lottery terminal, or on a network of video lottery terminals,

  4  and in which the outcome is randomly determined by the play of

  5  video lottery terminals linked by a central network. A video

  6  lottery terminal may use spinning reels or video displays, or

  7  both. No video lottery terminal shall directly dispense coins,

  8  cash, or tokens.

  9         (9)  "Video lottery terminal vendor" means any person

10  or entity approved by the department which provides the video

11  lottery terminals to a video lottery retailer or computer

12  functions related to video lottery terminals to the

13  department.

14         (10)  "Net terminal income" means currency and other

15  consideration placed into a video lottery terminal minus

16  credits redeemed by players.

17         (11)  "Video lottery retailer" means any person who

18  possesses a pari-mutuel permit on July 1, 1998, issued

19  pursuant to chapter 550, who either has conducted a full

20  schedule of live racing or games between July 1, 1997, and

21  June 30, 1998, as defined by s. 550.002(11), or is authorized

22  to receive broadcasts of horseraces pursuant to s. 550.615.

23         Section 4.  Section 24.105, Florida Statutes, 1998

24  Supplement, is amended to read:

25         24.105  Powers and duties of department.--The

26  department shall:

27         (1)  Have the authority to sue or be sued in the

28  corporate name of the department and to adopt a corporate seal

29  and symbol.

30

31

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (2)(a)  Supervise and administer the operation of the

  2  lottery in accordance with the provisions of this chapter act

  3  and rules adopted pursuant thereto.

  4         (b)1.  Initiate the public sale of lottery tickets with

  5  an instant game starting no later than January 15, 1988.  If

  6  the secretary finds that a state of emergency exists that

  7  would prohibit the department from initiating such sale on or

  8  before such date or that would cause the initiation of such

  9  sale on or before such date to be clearly contrary to the

10  integrity of the state, the secretary shall certify such

11  finding to the Governor. If the Governor verifies such

12  finding, the department shall initiate the sale of lottery

13  tickets on the earliest feasible date after the abatement of

14  such state of emergency.

15         2.  Also begin to operate on-line games no later than

16  May 1, 1988. If the secretary finds that a state of emergency

17  exists that would prohibit the department from initiating such

18  on-line games on or before such date or that would cause the

19  initiation of on-line games on or before such date to be

20  clearly contrary to the integrity of the state, the secretary

21  shall certify such finding to the Governor.  If the Governor

22  verifies such finding, the department shall initiate the sale

23  of lottery tickets on the earliest feasible date after the

24  abatement of such state of emergency.

25         (3)  For purposes of any investigation or proceeding

26  conducted by the department, have the power to administer

27  oaths, require affidavits, take depositions, issue subpoenas,

28  and compel the attendance of witnesses and the production of

29  books, papers, documents, and other evidence.

30

31

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (4)  Make available to the commission any record or

  2  other information relating to the lottery that the commission

  3  requests.

  4         (5)  Submit monthly and annual reports to the

  5  commission, the Governor, the Treasurer, the President of the

  6  Senate, and the Speaker of the House of Representatives

  7  disclosing the total lottery revenues, prize disbursements,

  8  and other expenses of the department during the preceding

  9  month.  The annual report shall additionally describe the

10  organizational structure of the department, including its

11  hierarchical structure, and shall identify the divisions and

12  bureaus created by the secretary and summarize the

13  departmental functions performed by each.

14         (6)  Adopt by rule a system of internal audits.

15         (7)  Maintain weekly or more frequent records of

16  lottery transactions, including the distribution of tickets to

17  retailers, revenues received, claims for prizes, prizes paid,

18  and other financial transactions of the department.

19         (8)  Make a continuing study of the lottery to

20  ascertain any defects of the laws governing the lottery this

21  act or rules adopted thereunder which could result in abuses

22  in the administration of the lottery; make a continuing study

23  of the operation and the administration of similar laws in

24  other states and of federal laws which may affect the lottery;

25  and make a continuing study of the reaction of the public to

26  existing and potential features of the lottery.

27         (9)  Conduct such market research as is necessary or

28  appropriate, which may include an analysis of the demographic

29  characteristics of the players of each lottery game and an

30  analysis of advertising, promotion, public relations,

31  incentives, and other aspects of communications.

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (10)  Have in place the capacity to support video

  2  lottery games at facilities of video lottery retailers

  3  beginning no later than October 1, 1999.

  4         (11)  Hear and decide promptly and in reasonable order

  5  all license applications or proceedings for suspension or

  6  revocation of licenses.

  7         (12)  Collect and disperse such revenue due the

  8  department as described in this chapter.

  9         (13)  Certify net terminal income by inspecting

10  records, conducting audits, or any other reasonable means.

11         (14)  Provide a list of approved vendors and maintain a

12  current list of all contracts between video lottery terminal

13  vendors and video lottery retailers.

14         (15)  Approve an application as a video lottery

15  retailer, pursuant to s. 24.103(11), within 30 days of the

16  receipt of the application.

17         (16)(10)  Adopt rules governing the establishment and

18  operation of the state lottery, including:

19         (a)  The type of lottery games to be conducted, except

20  that:

21         1.  No name of an elected official shall appear on the

22  ticket or play slip of any lottery game or on any prize or on

23  any instrument used for the payment of prizes, unless such

24  prize is in the form of a state warrant.

25         2.  No coins or currency shall be dispensed from any

26  electronic computer terminal or device used in any lottery

27  game.

28         3.  Other than as provided in subparagraph 4., no

29  terminal or device may be used for any lottery game which may

30  be operated solely by the player without the assistance of the

31

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  retailer, except authorized video lottery terminals operated

  2  pursuant to this chapter.

  3         4.  The only player-activated machine which may be

  4  utilized is a machine which dispenses instant lottery game

  5  tickets following the insertion of a coin or currency by a

  6  ticket purchaser.  To be authorized a machine must: be under

  7  the supervision and within the direct line of sight of the

  8  lottery retailer to ensure that the machine is monitored and

  9  only operated by persons at least 18 years of age; be capable

10  of being electronically deactivated by the retailer to

11  prohibit use by persons less than 18 years of age through the

12  use of a lockout device that maintains the machine's

13  deactivation for a period of no less than 5 minutes; and be

14  designed to prevent its use or conversion for use in any

15  manner other than the dispensing of instant lottery tickets.

16  Authorized machines may dispense change to players purchasing

17  tickets but may not be utilized for paying the holders of

18  winning tickets of any kind. At least one clerk must be on

19  duty at the lottery retailer while the machine is in

20  operation. However, at least two clerks must be on duty at any

21  lottery location which has violated s. 24.1055.

22         (b)  The sales price of tickets.

23         (c)  The number and sizes of prizes.

24         (d)  The method of selecting winning tickets.  However,

25  if a lottery game involves a drawing, the drawing shall be

26  public and witnessed by an accountant employed by an

27  independent certified public accounting firm.  The equipment

28  used in the drawing shall be inspected before and after the

29  drawing.

30         (e)  The manner of payment of prizes to holders of

31  winning tickets.

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (f)  The frequency of drawings or selections of winning

  2  tickets.

  3         (g)  The number and type of locations at which tickets

  4  may be purchased.

  5         (h)  The method to be used in selling tickets.

  6         (i)  The manner and amount of compensation of

  7  retailers.

  8         (j)  Such other matters necessary or desirable for the

  9  efficient or economical operation of the lottery or for the

10  convenience of the public.

11         (k)  The regulation of video lottery retailers as

12  pertains to video lottery products.

13         (l)  Specifications for video lottery terminals to be

14  approved and authorized as the department deems necessary to

15  maintain the integrity of video lottery games and terminals.

16  Initial rules sufficient to permit the operation of video

17  lotteries and the licensing of video lottery retailers shall

18  be adopted no later than August 1, 1999. The department shall

19  not provide for specifications that would have the result of

20  reducing to fewer than four the number of video lottery

21  terminal vendors who supply terminals that meet the

22  specifications.

23         (m)  The licensure and regulation of video lottery

24  terminal vendors. The department shall not approve any person

25  as a video lottery terminal vendor if such person has an

26  interest in a video lottery retailer or a business

27  relationship with a video lottery retailer other than as a

28  vendor or lessor of video lottery terminals.

29         (17)(11)  Have the authority to hold copyrights,

30  trademarks, and service marks and enforce its rights with

31  respect thereto.

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (18)(12)  In the selection of games and method of

  2  selecting winning tickets, be sensitive to the impact of the

  3  lottery upon the pari-mutuel industry and, accordingly, the

  4  department may use for any game the theme of horseracing,

  5  dogracing, or jai alai and may allow a lottery game to be

  6  based upon a horserace, dograce, or jai alai activity so long

  7  as the outcome of such lottery game is determined entirely by

  8  chance.

  9         (19)(13)(a)  Determine by rule information relating to

10  the operation of the lottery which is confidential and exempt

11  from the provisions of s. 119.07(1) and s. 24(a), Art. I of

12  the State Constitution.  Such information includes trade

13  secrets; security measures, systems, or procedures; security

14  reports; information concerning bids or other contractual

15  data, the disclosure of which would impair the efforts of the

16  department to contract for goods or services on favorable

17  terms; employee personnel information unrelated to

18  compensation, duties, qualifications, or responsibilities; and

19  information obtained by the Division of Security pursuant to

20  its investigations which is otherwise confidential.  To be

21  deemed confidential, the information must be necessary to the

22  security and integrity of the lottery. Confidential

23  information may be released to other governmental entities as

24  needed in connection with the performance of their duties.

25  The receiving governmental entity shall retain the

26  confidentiality of such information as provided for in this

27  subsection.

28         (b)  Maintain the confidentiality of the street address

29  and the telephone number of a winner, in that such information

30  is confidential and exempt from the provisions of s. 119.07(1)

31  and s. 24(a), Art. I of the State Constitution, unless the

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  winner consents to the release of such information or as

  2  provided for in s. 24.115(4) or s. 409.2577.

  3         (c)  Any information made confidential and exempt from

  4  the provisions of s. 119.07(1) under this subsection shall be

  5  disclosed to a member of the commission, to the Auditor

  6  General, or to the independent auditor selected under s.

  7  24.123 upon such person's request therefor.  If the President

  8  of the Senate or the Speaker of the House of Representatives

  9  certifies that information made confidential under this

10  subsection is necessary for effecting legislative changes, the

11  requested information shall be disclosed to him or her, and he

12  or she may disclose such information to members of the

13  Legislature and legislative staff as necessary to effect such

14  purpose.

15         (20)(14)  Have the authority to perform any of the

16  functions of the Department of Management Services under

17  chapter 255, chapter 273, chapter 281, chapter 283, or chapter

18  287, or any rules adopted under any such chapter, and may

19  grant approvals provided for under any such chapter or rules.

20  If the department finds, by rule, that compliance with any

21  such chapter would impair or impede the effective or efficient

22  operation of the lottery, the department may adopt rules

23  providing alternative procurement procedures.  Such

24  alternative procedures shall be designed to allow the

25  department to evaluate competing proposals and select the

26  proposal that provides the greatest long-term benefit to the

27  state with respect to the quality of the products or services,

28  dependability and integrity of the vendor, dependability of

29  the vendor's products or services, security, competence,

30  timeliness, and maximization of gross revenues and net

31  proceeds over the life of the contract.

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (21)(15)  Have the authority to acquire real property

  2  and make improvements thereon.  The title to such property

  3  shall be vested in the Board of Trustees of the Internal

  4  Improvement Trust Fund.  The board shall give the department

  5  preference in leasing state-owned lands under the board's

  6  control and may not exercise any jurisdiction over lands

  7  purchased or leased by the department while such lands are

  8  actively used by the department. Actions of the department

  9  under this subsection are exempt from the time limitations and

10  deadlines of chapter 253.

11         (22)(16)  Have the authority to charge fees to persons

12  applying for contracts as vendors or retailers, which fees are

13  reasonably calculated to cover the costs of investigations and

14  other activities related to the processing of the application.

15         (23)(17)  Enter into contracts for the purchase, lease,

16  or lease-purchase of such goods and services as are necessary

17  for the operation and promotion of the state lottery,

18  including assistance provided by any governmental agency.

19         (24)(18)  In accordance with the provisions of this

20  chapter act, enter into contracts with retailers so as to

21  provide adequate and convenient availability of tickets to the

22  public for each game.

23         (25)(19)  Have the authority to enter into agreements

24  with other states for the operation and promotion of a

25  multistate lottery if such agreements are in the best interest

26  of the state lottery.  The authority conferred by this

27  subsection is not effective until 1 year after the first day

28  of lottery ticket sales.

29         (26)(20)  Employ division directors and other staff as

30  may be necessary to carry out the provisions of this chapter

31  act; however:

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (a)  No person shall be employed by the department who

  2  has been convicted of, or entered a plea of guilty or nolo

  3  contendere to, a felony committed in the preceding 10 years,

  4  regardless of adjudication, unless the department determines

  5  that:

  6         1.  The person has been pardoned or his or her civil

  7  rights have been restored; or

  8         2.  Subsequent to such conviction or entry of plea the

  9  person has engaged in the kind of law-abiding commerce and

10  good citizenship that would reflect well upon the integrity of

11  the lottery.

12         (b)  No officer or employee of the department having

13  decisionmaking authority shall participate in any decision

14  involving any vendor or retailer with whom the officer or

15  employee has a financial interest.  No such officer or

16  employee may participate in any decision involving any vendor

17  or retailer with whom the officer or employee has discussed

18  employment opportunities without the approval of the secretary

19  or, if such officer is the secretary or any member of the

20  commission, without the approval of the Governor.  Any officer

21  or employee of the department shall notify the secretary of

22  any such discussion or, if such officer is the secretary or a

23  member of the commission, he or she shall notify the Governor.

24  A violation of this paragraph is punishable in accordance with

25  s. 112.317.

26         (c)  No officer or employee of the department who

27  leaves the employ of the department shall represent any vendor

28  or retailer before the department regarding any specific

29  matter in which the officer or employee was involved while

30  employed by the department, for a period of 1 year following

31

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  1  cessation of employment with the department.  A violation of

  2  this paragraph is punishable in accordance with s. 112.317.

  3         (d)  The department shall establish and maintain a

  4  personnel program for its employees, including a personnel

  5  classification and pay plan which may provide any or all of

  6  the benefits provided in the Senior Management Service or

  7  Selected Exempt Service.  Each officer or employee of the

  8  department shall be a member of the Florida Retirement System.

  9  The retirement class of each officer or employee shall be the

10  same as other persons performing comparable functions for

11  other agencies.  Employees of the department shall serve at

12  the pleasure of the secretary and shall be subject to

13  suspension, dismissal, reduction in pay, demotion, transfer,

14  or other personnel action at the discretion of the secretary.

15  Such personnel actions are exempt from the provisions of

16  chapter 120. All employees of the department are exempt from

17  the Career Service System provided in chapter 110 and,

18  notwithstanding the provisions of s. 110.205(5), are not

19  included in either the Senior Management Service or the

20  Selected Exempt Service. However, all employees of the

21  department are subject to all standards of conduct adopted by

22  rule for career service and senior management employees

23  pursuant to chapter 110.  In the event of a conflict between

24  standards of conduct applicable to employees of the Department

25  of the Lottery the more restrictive standard shall apply.

26  Interpretations as to the more restrictive standard may be

27  provided by the Commission on Ethics upon request of an

28  advisory opinion pursuant to s. 112.322(3)(a), for purposes of

29  this subsection the opinion shall be considered final action.

30         (27)(21)  Adopt by rule a code of ethics for officers

31  and employees of the department which supplements the

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  1  standards of conduct for public officers and employees imposed

  2  by law.

  3         Section 5.  Section 24.1055, Florida Statutes, is

  4  amended to read:

  5         24.1055  Prohibition against sale of lottery tickets to

  6  minors; posting of signs; penalties.--

  7         (1)  No person who is less than 18 years of age may

  8  purchase a lottery ticket by means of a machine or otherwise.

  9         (2)  Any retailer that sells lottery tickets by means

10  of a player activated machine shall post a clear and

11  conspicuous sign on such machine, which states the following:

12         THE SALE OF LOTTERY TICKETS TO PERSONS UNDER

13         THE AGE OF 18 IS AGAINST FLORIDA LAW (SECTION

14         24.1055 24.105, FLORIDA STATUTES).  PROOF OF

15         AGE IS REQUIRED FOR PURCHASE.

16         (3)  No person who is less than 18 years of age may

17  play a video lottery game authorized by this chapter.

18         (4)  Any video lottery retailer that has a video

19  lottery terminal at its facility shall post a clear and

20  conspicuous sign on such terminal, which states the following:

21         THE USE OF A VIDEO LOTTERY TERMINAL BY PERSONS

22         UNDER THE AGE OF 18 IS AGAINST FLORIDA LAW

23         (SECTION 24.1055, FLORIDA STATUTES).  PROOF OF

24         AGE IS REQUIRED FOR USE.

25         (5)(3)  Any person, including any vendor or video

26  lottery retailer, who violates this section is guilty of a

27  misdemeanor of the second degree, punishable as provided in s.

28  775.082 or s. 775.083.

29         Section 6.  Subsections (5) and (7) of section 24.108,

30  Florida Statutes, are amended to read:

31

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  1         24.108  Division of Security; duties; security

  2  report.--

  3         (5)  The Department of Law Enforcement shall provide

  4  assistance in obtaining criminal history information relevant

  5  to investigations required for honest, secure, and exemplary

  6  lottery operations, and such other assistance as may be

  7  requested by the secretary and agreed to by the executive

  8  director of the Department of Law Enforcement. Any other state

  9  agency, including the Department of Business and Professional

10  Regulation and the Department of Revenue, shall, upon request,

11  provide the Department of the Lottery with any information

12  relevant to any investigation conducted pursuant to this

13  chapter act. The Department of the Lottery shall maintain the

14  confidentiality of any confidential information it receives

15  from any other agency. The Department of the Lottery shall

16  reimburse any agency for the actual cost of providing any

17  assistance pursuant to this subsection.

18         (7)(a)  After the first full year of sales of tickets

19  to the public, or sooner if the secretary deems necessary, the

20  department shall engage an independent firm experienced in

21  security procedures, including, but not limited to, computer

22  security and systems security, to conduct a comprehensive

23  study and evaluation of all aspects of security in the

24  operation of the department.

25         (b)  The portion of the security report containing the

26  overall evaluation of the department in terms of each aspect

27  of security shall be presented to the commission, the

28  Governor, the President of the Senate, and the Speaker of the

29  House of Representatives.  The portion of the security report

30  containing specific recommendations shall be confidential and

31  shall be presented only to the secretary, the commission, the

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  1  Governor, and the Auditor General; however, upon certification

  2  that such information is necessary for the purpose of

  3  effecting legislative changes, such information shall be

  4  disclosed to the President of the Senate and the Speaker of

  5  the House of Representatives, who may disclose such

  6  information to members of the Legislature and legislative

  7  staff as necessary to effect such purpose. However, any person

  8  who receives a copy of such information or other information

  9  which is confidential pursuant to this chapter act or rule of

10  the department shall maintain its confidentiality.  The

11  confidential portion of the report is exempt from the

12  provisions of s. 119.07(1) and s. 24(a), Art. I of the State

13  Constitution.

14         (c)  Thereafter, similar studies of security shall be

15  conducted as the department deems appropriate but at least

16  once every 2 years.

17         Section 7.  Subsection (1) of section 24.111, Florida

18  Statutes, 1998 Supplement, is amended to read:

19         24.111  Vendors; disclosure and contract

20  requirements.--

21         (1)  The department may enter into contracts for the

22  purchase, lease, or lease-purchase of such goods or services

23  as are necessary for effectuating the purposes of this chapter

24  act.  The department may not contract with any person or

25  entity for the total operation and administration of the state

26  lottery established by this chapter act but may make

27  procurements which integrate functions such as lottery game

28  design, supply of goods and services, and advertising.  In all

29  procurement decisions, the department shall take into account

30  the particularly sensitive nature of the state lottery and

31  shall consider the competence, quality of product, experience,

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  1  and timely performance of the vendors in order to promote and

  2  ensure security, honesty, fairness, and integrity in the

  3  operation and administration of the lottery and the objective

  4  of raising net revenues for the benefit of the public purpose

  5  described in this chapter act.

  6         Section 8.  Section 24.1121, Florida Statutes, is

  7  created to read:

  8         24.1121  Video lottery games.--

  9         (1)  Video lottery games may only be offered by a video

10  lottery retailer at its pari-mutuel facility. During any

11  calendar year in which a video lottery retailer maintains

12  video lottery terminals within the confines of its pari-mutuel

13  facility, the video lottery retailer must conduct a full

14  schedule of live racing or games as defined in s. 550.002(11)

15  or be authorized to receive broadcasts of horseraces pursuant

16  to s. 550.615.  In the case of a person who possesses a

17  greyhound racing permit or a jai alai permit, such person

18  shall be eligible to serve as a video lottery retailer only if

19  that permitholder has also conducted, during the prior fiscal

20  year, no fewer than 80 percent of the number of performances

21  and no fewer than 80 percent of the number of live races or

22  games which the same permitholder conducted during the

23  1997-1998 state fiscal year. The department may waive the

24  requirements provided in this subsection relating to the

25  conducting of live races or games upon a showing that the

26  failure to conduct such games resulted from a natural disaster

27  or other acts beyond the control of the permitholder. If the

28  video lottery retailer fails to comply with the requirement to

29  conduct a full schedule of races or games or, if a greyhound

30  racing permitholder or jai alai permitholder, the video

31  lottery retailer failed in the previous fiscal year to conduct

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  1  the required number of live races or games, within 30 days

  2  after written notice from the department, the department shall

  3  order the video lottery retailer to suspend its video lottery

  4  operation. The department may assess an administrative fine

  5  not to exceed $5,000 per video lottery terminal, per day,

  6  against any video lottery retailer who fails to suspend its

  7  video lottery operation when ordered to suspend by the

  8  department. The department may enforce its order of suspension

  9  or any administrative fine assessed in furtherance of such

10  order as provided in s. 120.69. Each video lottery retailer

11  shall post a bond payable to the state in an amount determined

12  by the department that is sufficient to guarantee payment to

13  the state of revenue due in any payment period.

14         (2)  Each pari-mutuel permitholder shall notify the

15  department prior to operating video lottery games at the

16  pari-mutuel facility.

17         (3)  To facilitate the auditing and security programs

18  critical to the integrity of the video lottery system, the

19  department shall have overall control of the entire system.

20  Each video lottery terminal shall be linked, directly or

21  indirectly, to a computer system under the control of the

22  department.

23         (4)  The department shall determine, by rule, the

24  method by which cash receipts will be electronically validated

25  and redeemed.

26         (5)  No person under the age of 18 years may play a

27  video lottery game authorized by this chapter.

28         (6)  Video lottery games may be played at an authorized

29  video lottery retailer's pari-mutuel facility even if such

30  retailer is not conducting a pari-mutuel event.

31

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  1         (7)  Video lottery games shall pay out a minimum of 88

  2  percent and no more than 99 percent of the amount of cash,

  3  tokens, credits, or vouchers put into a video lottery

  4  terminal.  The department may permit the payment of a lesser

  5  percentage if requested by a video lottery retailer and the

  6  department determines that the payment of a minimum of 88

  7  percent is not financially viable at the video lottery

  8  retailer's location and that the total amount of net revenue

  9  payable to the Public Education Capital Outlay and Debt

10  Service Trust Fund will not be negatively impacted. Such

11  percentages shall be measured on an annual basis.

12         (8)  Income derived from video lottery operations shall

13  not be subject to the provisions of s. 24.121. The allocation

14  of net terminal income derived from video lottery games shall

15  be as follows:

16         (a)  Thirty-eight percent to the Video Lottery

17  Administrative Trust Fund of the department for transfer to

18  the Public Education Capital Outlay and Debt Service Trust

19  Fund.

20         (b)  Two percent to the Video Lottery Administrative

21  Trust Fund of the department for transfer to the

22  Administrative Trust Fund established pursuant to s. 24.120.

23         (c)  Eight percent to the Video Lottery Administrative

24  Trust Fund of the department for transfer to the Video Lottery

25  Purse Trust Fund in the Department of Business and

26  Professional Regulation, to be distributed in accordance with

27  s. 550.26315(1).

28         (d)  To the Video Lottery Administrative Trust Fund of

29  the department for transfer to the Department of Health, 0.25

30  percent for the establishment and administration of a

31  treatment program for gambling addiction.

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  1         (e)  If the video lottery retailer holds a valid

  2  thoroughbred permit under chapter 550, 20 percent of its net

  3  terminal income shall be remitted to the Video Lottery

  4  Thoroughbred Trust Fund in the Department of Business and

  5  Professional Regulation, to be distributed in accordance with

  6  s. 550.26325.

  7         (f)  To be retained by the video lottery retailer as

  8  compensation:

  9         1.  If a valid thoroughbred permitholder under chapter

10  550, 31.75 percent.

11         2.  If a holder of a valid harness racing permit under

12  chapter 550, 45.75 percent.

13         3.  If a valid holder of a permit other than a

14  thoroughbred permit or harness racing permit, 45.75 percent.

15         (g)  If the video lottery retailer holds a valid

16  harness racing permit under chapter 550, 6 percent of its net

17  terminal income shall be distributed by the video lottery

18  retailer as purses for live performances conducted at the

19  video lottery retailer's pari-mutuel facility in accordance

20  with the provisions of chapter 550.

21         (h)  If the video lottery retailer holds a valid jai

22  alai permit under chapter 550, 6 percent of its net terminal

23  income shall be distributed by the video lottery retailer as

24  purses for live performances conducted at the video lottery

25  retailer's pari-mutuel facility in accordance with chapter

26  550.

27         (i)  If the video lottery retailer holds a valid

28  greyhound racing permit under chapter 550, 6 percent of its

29  net terminal income shall be distributed by the video lottery

30  retailer as purses for live performances conducted at the

31

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  1  video lottery retailer's pari-mutuel facility in accordance

  2  with chapter 550.

  3         (9)  The allocation provided in subsection (8) shall be

  4  made weekly.  Amounts allocated pursuant to paragraphs

  5  (8)(a)-(e) shall be remitted to the department by electronic

  6  transfer within 24 hours after the allocation is determined.

  7  If live meets were conducted at the pari-mutuel facility of

  8  the video lottery retailer during the weekly period for which

  9  the allocation is made, the portion of the allocation to be

10  distributed pursuant to paragraphs (8)(g), (h), and (i) shall

11  be paid as purses for those live meets.  If no live meets were

12  conducted at the pari-mutuel facility during the weekly period

13  for which the allocation is made, the distribution of purse

14  money shall be made during the next ensuing meet following the

15  weekly period in which the net terminal income is earned. The

16  accumulated amount to be distributed as purses during the next

17  ensuing meet shall be distributed weekly during the

18  permitholder's next race meeting in an amount determined by

19  dividing the amount to be distributed by the number of

20  performances approved for the permitholder pursuant to its

21  annual license and multiplying that amount by the number of

22  performances conducted each week. No less than one-half of the

23  interest income earned on funds required to be distributed

24  under paragraphs (8)(g), (h), and (i) prior to their

25  distribution as purses shall be distributed by the video

26  lottery retailer as purses for live performances conducted at

27  the video lottery retailer's pari-mutuel facility in

28  accordance with chapter 550.

29         (10)  Any person who, with intent to manipulate the

30  outcome, payoff, or operation of a video lottery terminal,

31  manipulates or attempts to manipulate the outcome, payoff, or

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  1  operation of a video lottery terminal by physical or

  2  electronic tampering or other means commits a felony of the

  3  third degree, punishable as provided in s. 775.082, s.

  4  775.083, or s. 775.084.

  5         (11)  Notwithstanding s. 24.115, each video lottery

  6  retailer shall have the responsibility for payment of video

  7  lottery prizes.

  8         (12)  In any area or room in a facility in which a

  9  video lottery terminal is placed, the video lottery retailer

10  must also place video monitors displaying the live races or

11  games of that facility, if such are being conducted, or

12  displaying available simulcast races or games, if no live

13  races or games are being conducted.  In each such area or

14  room, the video lottery retailer shall also provide a means by

15  which patrons may wager on pari-mutuel activity.

16         Section 9.  Section 24.1122, Florida Statutes, is

17  created to read:

18         24.1122  Licensure of video lottery terminal

19  vendors.--Video lottery terminal vendors shall be licensed by

20  the Department of the Lottery, and, by August 1, 1999, the

21  department shall adopt rules governing such licensure. The

22  department shall not license any person as a video lottery

23  terminal vendor if such person has an interest in a video

24  lottery retailer or a business relationship with a video

25  lottery retailer other than as a vendor or lessor of video

26  lottery terminals.

27         Section 10.  Section 24.1123, Florida Statutes, is

28  created to read:

29         24.1123  Local zoning of pari-mutuel facilities.--The

30  installation, operation, or use of a video lottery terminal on

31  any property on which pari-mutuel operations were or would

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    Florida Senate - 1999                                  SB 2176
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  1  have been lawful under any county or municipal zoning

  2  ordinance as of July 1, 1997, shall not be deemed to change

  3  the character of the use of such property and shall not be

  4  prohibited on such property by any local zoning ordinance or

  5  amendments thereto.

  6         Section 11.  Section 24.1124, Florida Statutes, is

  7  created to read:

  8         24.1124  Video lottery terminals.--

  9         (1)  Video lottery terminals shall not be offered for

10  use or play in this state unless approved by the department.

11         (2)  Video lottery terminals approved for use in this

12  state shall:

13         (a)  Be protected against manipulation to affect the

14  random probabilities of winning plays.

15         (b)  Have one or more mechanisms that accept coins,

16  currency, tokens, or vouchers in exchange for game credits.

17  Such mechanisms shall be designed to prevent players from

18  obtaining credits by means of physical tampering.

19         (c)  Be capable of suspending play until reset at the

20  direction of the department as a result of physical tampering.

21         (d)  Be capable of being linked to the department's

22  central computer communications system for the purpose of

23  auditing of the operation, financial data, and program

24  information as required by the department.

25         Section 12.  Section 24.1125, Florida Statutes, is

26  created to read:

27         24.1125  Video lottery terminal training program.--

28         (1)  Every licensed video lottery terminal vendor shall

29  submit a training program for the service and maintenance of

30  such terminals and equipment for approval by the department.

31  The training program shall include an outline of the training

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  1  curriculum, a list of instructors and their qualifications, a

  2  copy of the instructional materials, and the dates, times, and

  3  location of training classes. No service and maintenance

  4  program shall be held unless approved by the department.

  5         (2)  Every video lottery terminal service employee

  6  shall complete the requirements of the manufacturer's training

  7  program before such employee performs service, maintenance, or

  8  repair on video lottery terminals or video lottery terminal

  9  associated equipment. Upon the successful completion by a

10  service employee of the training program required by this

11  section, the department shall issue a certificate authorizing

12  such employee to service, maintain, and repair video lottery

13  terminals and video lottery terminal associated equipment. No

14  certificate of completion shall be issued to any video lottery

15  terminal service employee until the department has ascertained

16  that such employee has completed the required training

17  program. Any person certified as a video lottery terminal

18  service employee under this section shall pass a background

19  investigation conducted under the rules of the department. The

20  department may revoke certification upon finding a video

21  lottery terminal service employee in violation of any

22  provision of this chapter or a department rule.

23         (3)  The department is authorized to adopt rules

24  regarding the training, qualifications, and certification of

25  video lottery terminal service employees, as provided in this

26  section.

27         Section 13.  Section 24.117, Florida Statutes, is

28  amended to read:

29         24.117  Unlawful sale of lottery tickets; penalty.--Any

30  person who knowingly:

31

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  1         (1)  Sells a state lottery ticket when not authorized

  2  by the department or this act to engage in such sale;

  3         (2)  Sells a state lottery ticket to a minor or permits

  4  a minor to use a video lottery terminal; or

  5         (3)  Sells a state lottery ticket at any price other

  6  than that established by the department;

  7

  8  is guilty of a misdemeanor of the first degree, punishable as

  9  provided in s. 775.082 or s. 775.083.

10         Section 14.  Subsection (4) of section 24.118, Florida

11  Statutes, is amended to read:

12         24.118  Other prohibited acts; penalties.--

13         (4)  BREACH OF CONFIDENTIALITY.--Any person who, with

14  intent to defraud or with intent to provide a financial or

15  other advantage to himself, herself, or another, knowingly and

16  willfully discloses any information relating to the lottery

17  designated as confidential and exempt from the provisions of

18  s. 119.07(1) pursuant to this chapter act is guilty of a

19  felony of the first degree, punishable as provided in s.

20  775.082, s. 775.083, or s. 775.084.

21         Section 15.  Subsection (1) of section 24.120, Florida

22  Statutes, is amended to read:

23         24.120  Financial matters; Administrative Trust Fund;

24  interagency cooperation.--

25         (1)  There is hereby created in the State Treasury an

26  Administrative Trust Fund to be administered in accordance

27  with chapters 215 and 216 by the department.  All money

28  received by the department which remains after payment of

29  prizes and initial compensation paid to retailers shall be

30  deposited into the Administrative Trust Fund.  All moneys in

31

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  1  the trust fund are appropriated to the department for the

  2  purposes specified in this chapter act.

  3         Section 16.  Section 24.122, Florida Statutes, is

  4  amended to read:

  5         24.122  Exemption from taxation; state preemption;

  6  inapplicability of other laws.--

  7         (1)  This chapter act shall not be construed to

  8  authorize any lottery except the lotteries lottery operated or

  9  directed by the department pursuant to this chapter act.

10         (2)  No state or local tax shall be imposed upon any

11  prize paid or payable under this chapter act or upon the sale

12  of any lottery ticket or the installation, rental, or use of

13  any video lottery terminal pursuant to this chapter act.

14         (3)  All matters relating to the operation of the state

15  lottery are preempted to the state, and no county,

16  municipality, or other political subdivision of the state

17  shall enact any ordinance relating to the operation of the

18  lottery authorized by this chapter act.  However, this

19  subsection shall not prohibit a political subdivision of the

20  state from requiring a retailer to obtain an occupational

21  license for any business unrelated to the sale of lottery

22  tickets.

23         (4)  Any state or local law providing any penalty,

24  disability, restriction, or prohibition for the possession,

25  manufacture, transportation, distribution, advertising, or

26  sale of any lottery ticket, including chapter 849, shall not

27  apply to the tickets of the state lottery operated pursuant to

28  this chapter act; nor shall any such law apply to the

29  possession of a ticket issued by any other government-operated

30  lottery.  In addition, activities of the department under this

31  chapter act are exempt from the provisions of:

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  1         (a)  Chapter 616, relating to public fairs and

  2  expositions.

  3         (b)  Chapter 946, relating to correctional work

  4  programs.

  5         (c)  Chapter 282, relating to communications and data

  6  processing.

  7         (d)  Section 110.131, relating to other personal

  8  services.

  9         Section 17.  Subsection (24) of section 212.02, Florida

10  Statutes, 1998 Supplement is amended to read:

11         212.02  Definitions.--The following terms and phrases

12  when used in this chapter have the meanings ascribed to them

13  in this section, except where the context clearly indicates a

14  different meaning:

15         (24)  "Coin-operated amusement machine" means any

16  machine operated by coin, slug, token, coupon, or similar

17  device for the purposes of entertainment or amusement.  The

18  term includes, but is not limited to, coin-operated pinball

19  machines, music machines, juke boxes, mechanical games, video

20  games, arcade games, billiard tables, moving picture viewers,

21  shooting galleries, and all other similar amusement devices.

22  The term does not include a video lottery terminal approved

23  pursuant to chapter 24.

24         Section 18.  Section 550.26315, Florida Statutes, is

25  created to read:

26         550.26315  Administration of the Video Lottery Purse

27  Trust Fund.--

28         (1)  Fifty-eight percent of the proceeds of the Video

29  Lottery Purse Trust Fund shall be transferred to the Video

30  Lottery Thoroughbred Trust Fund.

31

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         (2)  Forty-two percent of the proceeds of the Video

  2  Lottery Purse Trust Fund shall be distributed to pari-mutuel

  3  permitholders to be distributed as purses at their respective

  4  pari-mutuel facilities as follows:

  5         (a)  Eight percent shall be distributed to holders of

  6  valid harness racing permits;

  7         (b)  Seven percent shall be distributed to holders of

  8  valid jail alai permits;

  9         (c)  Twenty-seven percent shall be distributed to

10  holders of valid greyhound racing permits.

11

12  Each permitholder entitled to receive distributions under a

13  paragraph of this subsection shall receive a percentage of the

14  amount to be distributed under that paragraph which is

15  determined by dividing the amounts paid in purses by such

16  permitholder during the state fiscal year 1997-1998 by the

17  amount of purses paid by all such permitholders statewide

18  during the state fiscal year 1997-1998.

19         (3)  All proceeds distributed under this section are in

20  addition to and supplement the other funds set forth in this

21  chapter for use as purses, awards, and, in the case of jai

22  alai, player compensation.

23         (4)  Of amounts to be distributed pursuant to this

24  section and s. 24.1121(8)(i) to persons holding valid

25  greyhound racing permits, 10 percent of such sums shall be

26  distributed as additional purses on all live races at each

27  facility to Florida-bred greyhounds in a manner similar to the

28  distribution of regular purses and in accordance with rules

29  adopted by the division.

30         (5)  The department is authorized to adopt rules to

31  provide for the equitable distribution of funds by

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  permitholders for purses, awards, or jai alai player

  2  compensation, in accordance with the provisions of this

  3  section.

  4         Section 19.  Section 550.26325, Florida Statutes, is

  5  created to read:

  6         550.26325  Distribution of funds from Video Lottery

  7  Thoroughbred Trust Fund.--The proceeds of the Video Lottery

  8  Thoroughbred Trust Fund shall be distributed as follows:

  9         (1)  For use as Florida thoroughbred breeders' and

10  stallion awards pursuant to ss. 550.26165 and 550.2625: 6.6

11  percent.  The Florida Thoroughbred Breeders' Association may,

12  in accordance with s. 550.2625(3), deduct a fee for

13  administering the payment of awards and for general promotion

14  of the industry.

15         (2)  The remainder shall be divided proportionally

16  among the thoroughbred permitholders for use as purses based

17  upon the number of racing days each permitholder conducted

18  during the state fiscal year ending June 30, 1998. The number

19  of racing days used in this calculation shall be adjusted on

20  July 1, 2003, and every 5 years thereafter, to provide for a

21  proportional division based upon the average annual number of

22  racing days conducted by each permitholder during the

23  preceding 5 state fiscal years.

24         Section 20.  Paragraphs (d) and (e) of subsection (2)

25  of section 550.2625, Florida Statutes, 1998 Supplement, are

26  amended, and paragraph (f) is added to that subsection, to

27  read:

28         550.2625  Horseracing; minimum purse requirement,

29  Florida breeders' and owners' awards.--

30         (2)  Each permitholder conducting a horserace meet is

31  required to pay from the takeout withheld on pari-mutuel pools

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  a sum for purses in accordance with the type of race

  2  performed.

  3         (d)  The division shall adopt reasonable rules to

  4  ensure the timely and accurate payment of all amounts withheld

  5  by horserace permitholders regarding the distribution of

  6  purses, Florida breeders' and stallion awards, and Florida

  7  owners' awards, and all other amounts received or collected

  8  for payment to owners and breeders, including video lottery

  9  proceeds.  Each permitholder that fails to pay out during its

10  meet all moneys received or collected for payment to owners

11  and breeders during that meet shall, within 30 10 days after

12  the end of the meet during which the underpayment occurred

13  permitholder underpaid purses, deposit an amount equal to the

14  underpayment into a separate interest-bearing account to be

15  distributed to owners and breeders in accordance with division

16  rules. Any permitholder paying out during its meet less than

17  90 percent of all moneys received or collected for payment to

18  owners and breeders during that meet shall be subject to an

19  administrative fine in an amount equal to double the amount of

20  the underpayment. Within 30 days after the end of its meet,

21  each permitholder shall be required to file with the division

22  an audited accounting reflecting the receipt and payment of

23  all sums dedicated to purses, Florida breeders' and stallion

24  awards, and Florida owners' awards.

25         (e)  An amount equal to 8.5 percent of the purse

26  account generated through video lottery proceeds pursuant to

27  s. 550.26325(2), intertrack wagering and interstate

28  simulcasting will be used for Florida Owners' Awards as set

29  forth in subsection (3). Any thoroughbred permitholder with an

30  average blended takeout which does not exceed 20 percent and

31  with an average daily purse distribution excluding

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  sponsorship, entry fees, and nominations exceeding $225,000 is

  2  exempt from the provisions of this paragraph.

  3         (f)  The division shall adopt reasonable rules to

  4  ensure the timely and accurate payment of all amounts received

  5  or collected by a horsemen's or breeders' association for

  6  payment to owners and breeders, including video lottery

  7  proceeds. Each horsemen's or breeders' association that fails

  8  to pay out during the calendar year all moneys received or

  9  collected for payment to owners and breeders during that year

10  shall, within 30 days after the end of the calendar year

11  during which the underpayment occurred, deposit an amount

12  equal to the underpayment into a separate interest-bearing

13  account to be distributed to owners or breeders in accordance

14  with division rules. Any horsemen's or breeders' association

15  paying out during the calendar year less than 90 percent of

16  all moneys received or collected for payment to owners and

17  breeders during that calendar year shall be subject to an

18  administrative fine in an amount equal to double the amount of

19  the underpayment. Within 60 days after the end of the calendar

20  year, each permitholder shall be required to file with the

21  division an audited accounting reflecting the receipt and

22  payment of all sums received and collected for payment to

23  owners and breeders.

24         Section 21.  Section 550.401, Florida Statutes, is

25  created to read:

26         550.401  Limited prohibition on termination of kennel

27  operators.--A greyhound track may not terminate a kennel

28  operator, other than for breach of contract that remains in

29  breach 15 days following the delivery in writing of notice of

30  such breach to the kennel operator, for 12 months following

31  the first period that purse payments are made pursuant to the

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  provisions of s. 550.26315. Thereafter, only those kennel

  2  operators can be terminated without cause whose kennel

  3  occupies one of the bottom three positions based on total

  4  number of wins for two consecutive racing seasons, which may

  5  include the 12-month period following the first period that

  6  purse payments are made pursuant to the provisions of s.

  7  550.26315.

  8         Section 22.  Subsections (3) and (4) of section

  9  550.615, Florida Statutes, 1998 Supplement, are amended to

10  read:

11         550.615  Intertrack wagering.--

12         (3)(a)  If a permitholder who operates as a video

13  lottery retailer as defined in s. 24.103 elects to broadcast

14  its signal to any permitholder in this state, any

15  permitholder, not located in the same county as the host

16  track, that is eligible to conduct intertrack wagering under

17  the provisions of ss. 550.615-550.6345 is entitled to receive

18  the broadcast and conduct intertrack wagering under this

19  section; however, the host track may require a guest track

20  within 25 miles of another permitholder to receive in any week

21  at least 60 percent of the live races that the host track is

22  making available on the days that the guest track is otherwise

23  operating live races or games. A host track may require a

24  guest track not operating live races or games and within 25

25  miles of another permitholder to accept within any week at

26  least 60 percent of the live races that the host track is

27  making available. A permitholder may, pursuant to a written

28  contract, elect to broadcast its signal to any permitholder in

29  this state located within the same county as the host track,

30  provided that where a thoroughbred permitholder is the host

31  track, any such contract must be approved by the horsemen's

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  association, as defined in s. 550.2614. A person may not

  2  restrain or attempt to restrain any permitholder that is

  3  otherwise authorized to conduct intertrack wagering from

  4  receiving the signal of any other permitholder or sending its

  5  signal to any permitholder.

  6         (b)  If a permitholder who does not operate as a video

  7  lottery retailer as defined in s. 24.103 elects to broadcast

  8  its signal to any permitholder in this state, any permitholder

  9  that is eligible to conduct intertrack wagering under the

10  provisions of ss. 550.615-550.6345 is entitled to receive the

11  broadcast and conduct intertrack wagering under this section;

12  provided, however, that the host track may require a guest

13  track within 25 miles of another permitholder to receive in

14  any week at least 60 percent of the live races that the host

15  track is making available on the days that the guest track is

16  otherwise operating live races or games. A host track may

17  require a guest track not operating live races or games and

18  within 25 miles of another permitholder to accept within any

19  week at least 60 percent of the live races that the host track

20  is making available.  A person may not restrain or attempt to

21  restrain any permitholder that is otherwise authorized to

22  conduct intertrack wagering from receiving the signal of any

23  other permitholder or sending its signal to any permitholder.

24         (4)  In no event shall any intertrack wager be accepted

25  on the same class of live or simulcast races or games of any

26  permitholder without the written consent of such operating

27  permitholders conducting the same class of live or simulcast

28  races or games if the guest track is within the market area of

29  such operating permitholder.

30

31

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1         Section 23.  Paragraph (g) of subsection (9) of section

  2  550.6305, Florida Statutes, 1998 Supplement, is amended to

  3  read:

  4         550.6305  Intertrack wagering; guest track payments;

  5  accounting rules.--

  6         (9)  A host track that has contracted with an

  7  out-of-state horse track to broadcast live races conducted at

  8  such out-of-state horse track pursuant to s. 550.3551(5) may

  9  broadcast such out-of-state races to any guest track and

10  accept wagers thereon in the same manner as is provided in s.

11  550.3551.

12         (g)1.  Any thoroughbred permitholder which accepts

13  wagers on a simulcast signal must make the signal available to

14  any permitholder that is located in a county other than the

15  county in which the permitholder providing the signal is

16  located and that is eligible to conduct intertrack wagering

17  under the provisions of ss. 550.615-550.6345.

18         2.  Any thoroughbred permitholder which accepts wagers

19  on a simulcast signal received after 6 p.m. must make such

20  signal available to any permitholder that is eligible to

21  conduct intertrack wagering under the provisions of ss.

22  550.615-550.6345, including any permitholder located as

23  specified in s. 550.615(6).  Such guest permitholders are

24  authorized to accept wagers on such simulcast signal,

25  notwithstanding any other provision of this chapter to the

26  contrary.

27         3.  Any thoroughbred permitholder which accepts wagers

28  on a simulcast signal received after 6 p.m. must make such

29  signal available to any permitholder that is eligible to

30  conduct intertrack wagering under the provisions of ss.

31  550.615-550.6345, including any permitholder located as

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  specified in s. 550.615(9).  Such guest permitholders are

  2  authorized to accept wagers on such simulcast signals for a

  3  number of performances not to exceed that which constitutes a

  4  full schedule of live races for a quarter horse permitholder

  5  pursuant to s. 550.002(11), notwithstanding any other

  6  provision of this chapter to the contrary, except that the

  7  restrictions provided in s. 550.615(9)(a) apply to wagers on

  8  such simulcast signals.

  9

10  No thoroughbred permitholder shall be required to continue to

11  rebroadcast a simulcast signal to any in-state permitholder if

12  the average per performance gross receipts returned to the

13  host permitholder over the preceding 30-day period were less

14  than $100.  Subject to the provisions of s. 550.615(4), as a

15  condition of receiving rebroadcasts of thoroughbred simulcast

16  signals under this paragraph, a guest permitholder must accept

17  intertrack wagers on all live races conducted by all

18  then-operating thoroughbred permitholders.

19         Section 24.  Subsection (5) of section 565.02, Florida

20  Statutes, is amended to read:

21         565.02  License fees; vendors; clubs; caterers; and

22  others.--

23         (5)  A caterer at a horse or dog racetrack or jai alai

24  fronton may obtain a license upon the payment of an annual

25  state license tax of $675. Such caterer's license shall permit

26  sales only within the enclosure in which such races or jai

27  alai games are conducted, and such licensee shall be permitted

28  to sell only during the period beginning 10 days before and

29  ending 10 days after racing or jai alai under the authority of

30  the Division of Pari-mutuel Wagering of the Department of

31  Business and Professional Regulation is conducted at such

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    Florida Senate - 1999                                  SB 2176
    38-1356A-99                                             See HB




  1  racetrack or jai alai fronton and on days on which the

  2  pari-mutuel facility is open to the public for the purpose of

  3  video lottery play authorized by the Department of the

  4  Lottery. Except as in this subsection otherwise provided,

  5  caterers licensed hereunder shall be treated as vendors

  6  licensed to sell by the drink the beverages mentioned herein

  7  and shall be subject to all the provisions hereof relating to

  8  such vendors.

  9         Section 25.  This act shall take effect upon becoming a

10  law, if Senate Bill     , Senate Bill     , and Senate Bill

11  or similar legislation is adopted in the same legislative

12  session or an extension thereof.

13

14            *****************************************

15                       LEGISLATIVE SUMMARY

16
      Provides for the establishment and operation of video
17    lottery games to be conducted at pari-mutuel facilities
      and the allocation of certain income from the games to
18    the Department of the Lottery for transfer to the Public
      Education Capital Outlay and Debt Service Trust Fund.
19    Provides additional funds for pari-mutuel purses. Changes
      regulation of intertrack wagering.
20

21

22

23

24

25

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