HB 1547

1
A bill to be entitled
2An act relating to video lotteries; amending s. 24.103,
3F.S.; providing definitions; amending s. 24.105, F.S.;
4providing powers and duties of the Department of the
5Lottery pertaining to video lottery games; providing for
6an annual fee; providing for disposition of the fee;
7creating s. 24.125, F.S.; providing for the adoption of
8rules; creating s. 24.126, F.S.; prohibiting certain
9persons from playing video lottery games; providing
10penalties; creating s. 24.127, F.S.; providing
11requirements for the operation of video lottery games;
12providing for assessment of an administrative fine and
13order of suspension; providing for enforcement; providing
14a payout percentage; providing for distribution of income;
15providing for weekly allocations; prohibiting manipulation
16of outcomes, payoffs, and operation of terminals;
17providing penalties; requiring colocation of events;
18creating s. 24.128, F.S.; providing for the licensure of
19video lottery terminal vendors; providing for the adoption
20of emergency rules; creating s. 24.129, F.S.; prohibiting
21certain local zoning ordinances; creating s. 24.130, F.S.;
22providing requirements for video lottery terminals;
23creating s. 24.131, F.S.; requiring video lottery terminal
24vendors to establish training programs for employees who
25service such terminals; requiring department approval of
26such programs; providing certification requirements for
27such employees; providing for the adoption of rules;
28creating s. 24.132, F.S.; providing for distribution of
29proceeds from the Video Lottery Purse Trust Fund;
30providing for the adoption of rules; creating s. 24.133,
31F.S.; requiring operators of facilities where video
32lottery games are conducted to post certain warning signs
33regarding compulsive gambling; amending s. 212.02, F.S.;
34excluding video lottery terminals from the definition of
35"coin-operated amusement machine" for purposes of the
36sales and use tax; creating s. 24.134, F.S.; establishing
37programs for compulsive gambling within the Department of
38Children and Family Services; creating s. 24.136, F.S.;
39authorizing a caterer's license for video lottery
40retailers; providing an effective date.
41
42Be It Enacted by the Legislature of the State of Florida:
43
44     Section 1.  Subsections (7), (8), (9), (10), and (11) are
45added to section 24.103, Florida Statutes, to read:
46     24.103  Definitions.--As used in this act:
47     (7)  "Video lottery game" means an electronically simulated
48game involving any element of chance, skill, or both, played on
49a video lottery terminal that, upon insertion of currency,
50coins, tokens, credits, vouchers, or anything of value, is
51available to play or simulate a lottery-type game. The games
52include, but are not limited to, lineup games, traditional card
53games, poker, and progressive games where the jackpot grows and
54accumulates as it is being played in a video lottery terminal,
55or network of video lottery terminals, using a cathode ray tube,
56video display screen, or microprocessors, or other similar
57technology available now or in the future, as approved by the
58department. A player may receive a payoff in the form of
59currency, coins, tokens, credits, vouchers, or anything of value
60either automatically or in some other manner.
61     (8)  "Video lottery terminal" means a machine or device
62upon which a video lottery game is played or operated. A video
63lottery terminal may use spinning reels or video displays or
64other similar technology available now or in the future, as
65approved by the department.
66     (9)  "Video lottery terminal vendor" means any person
67licensed by the department who engages in the business of
68selling, leasing, servicing, repairing, or upgrading video
69lottery terminals for video lottery retailers or who provides to
70the department or to a video lottery retailer computer
71equipment, software, or other functions related to video lottery
72terminals.
73     (10)  "Net terminal income" means currency and other
74consideration placed into a video lottery terminal, less payouts
75to or credits redeemed by players.
76     (11)  "Video lottery retailer" means any pari-mutuel
77permitholder under chapter 550 who has paid the annual fee of $2
78million pursuant to s. 24.105(27) and who:
79     (a)  Conducted a full schedule of live racing or games, as
80described in ss. 550.002(11) and 550.475. However, in order to
81be included in the definition, a greyhound racing permitholder
82must have also conducted, during the prior fiscal year, no fewer
83than 80 percent of the number of performances and no fewer than
8480 percent of the number of live races that it conducted during
85the 1997-1998 state fiscal year;
86     (b)  Applied for a pari-mutuel permit between January 1,
872003, and March 1, 2003, and has conducted a full schedule of
88live racing or games as described in s. 550.002(11); or
89     (c)  Is authorized to receive broadcasts of horseraces
90under s. 550.6308.
91     Section 2.  Subsections (21), (22), (23), (24), (25), (26),
92and (27) are added to section 24.105, Florida Statutes, to read:
93     24.105  Powers and duties of department.--The department
94shall:
95     (21)  Have in place the capacity to support video lottery
96games at facilities of video lottery retailers by October 1,
972004.
98     (22)  Hear and decide promptly and in reasonable order all
99video lottery related license applications and enforcement
100proceedings for suspension or revocation of licenses.
101     (23)  Collect and disburse video lottery revenue due the
102department as described in this chapter.
103     (24)  Certify net terminal income of video lottery
104retailers by inspecting records, by conducting audits, or by any
105other reasonable means.
106     (25)  Maintain a list of licensed video lottery terminal
107vendors and a current list of all contracts between video
108lottery terminal vendors and video lottery retailers.
109     (26)  Approve an application for a video lottery retailer
110within 30 days after receipt of the application. Any person
111holding a pari-mutuel permit who has been licensed pursuant to
112chapter 550, meets the definition of a video lottery retailer
113under s. 24.103(11), and has paid the fee required in subsection
114(27) meets all qualifications of licensure under this section.
115     (27)  Within 10 days after approval of the application and
116on every July 1 thereafter, the video lottery retailer shall pay
117to the department a fee of $2 million. The $2 million fee shall
118be deposited into the Education Enhancement Trust Fund to be
119available to be bonded for school capital facilities
120construction.
121     Section 3.  Section 24.125, Florida Statutes, is created to
122read:
123     24.125  Rules authorized.--
124     (1)  The department may adopt rules relating to:
125     (a)  The regulation of video lottery retailers and video
126lottery products, including provisions to ensure that video
127lottery terminals are operated only by persons at least 18 years
128of age.
129     (b)  Specifications for video lottery terminals to be
130approved and authorized as the department deems necessary in
131order to maintain the integrity of video lottery games and
132terminals. The specifications may not limit the number of video
133lottery terminal vendors who supply terminals to fewer than
134four.
135     (c)  The regulation of video lottery terminal vendors.
136     (2)  Initial rules to permit the operation of video
137lotteries and the licensing of video lottery vendors shall be
138adopted by July 1, 2004. The department may adopt emergency
139rules under ss. 120.536(1) and 120.54 to implement this section.
140     Section 4.  Section 24.126, Florida Statutes, is created to
141read:
142     24.126  Video lottery; minimum age.--
143     (1)  A person who is younger than 18 years of age may not
144play a video lottery game.
145     (2)  Each video lottery retailer shall post a clear and
146conspicuous sign on all video lottery terminals which states:
147
148THE USE OF A VIDEO LOTTERY TERMINAL BY PERSONS UNDER THE AGE OF
14918 IS AGAINST FLORIDA LAW. PROOF OF AGE IS REQUIRED FOR USE.
150
151     (3)  Any person who violates this section commits a
152misdemeanor of the second degree, punishable as provided in s.
153775.082 or s. 775.083.
154     Section 5.  Section 24.127, Florida Statutes, is created to
155read:
156     24.127  Video lottery games.--
157     (1)  Video lottery games may be offered by a video lottery
158retailer only at its pari-mutuel facility at any time. During
159any calendar year in which a video lottery retailer maintains
160video lottery terminals, the retailer must have conducted in the
161prior year a full schedule of live racing or games, as defined
162in s. 550.002(11), including the conduct of races or games under
163s. 550.475, or be authorized to receive broadcasts of horse
164races under s. 550.6308. The department shall waive such
165requirements upon a showing that the failure to conduct races or
166games resulted from a natural disaster or other acts beyond the
167control of the permitholder, including legal restrictions or
168prohibitions placed on the permitholder's activities. If the
169retailer for any other reason does not comply with the
170requirement to conduct a full schedule of races or games, the
171department shall order the retailer to suspend its video lottery
172operation. The department may assess an administrative fine, not
173to exceed $5,000 per video lottery terminal per day, against any
174retailer who does not suspend its video lottery operation when
175ordered to do so by the department. The department may enforce a
176suspension order or administrative fine as provided in s.
177120.69. Each video lottery retailer shall post a bond payable to
178the state in an amount determined by the department which is
179sufficient to guarantee the payment of revenue due in any
180payment period.
181     (2)  Each video lottery retailer shall determine the
182following pertaining to the video lottery terminals located on
183its premises:
184     (a)  Number of video lottery terminals;
185     (b)  Dates and hours during which the video lottery
186terminals are available for play;
187     (c)  Mix of games available for play on video lottery
188terminals;
189     (d)  Use of currency, coins, tokens, vouchers, electronic
190credits, or anything of value;
191     (e)  Location and movement of video lottery terminals on
192the premises;
193     (f)  Staffing of video lottery terminal operations on the
194premises; and
195     (g)  Minimum and maximum betting amounts and the payout,
196based upon a suitable range, as determined by the video lottery
197retailer, with a minimum of 88 percent and a maximum of 95
198percent of the amount of currency, coins, tokens, credits,
199vouchers, or anything of value put into a video lottery
200terminal. Upon 10 days' written notice to the department, the
201department may approve a greater payout percentage than 95
202percent if the total annual payout is not greater than 95
203percent.
204     (3)  Each video lottery retailer shall notify the
205department prior to commencing the initial operation of the
206video lottery games.
207     (4)  To facilitate the auditing and security programs
208critical to the integrity of the video lottery system, the
209department has overall control of the entire system. Each video
210lottery terminal shall be linked, directly or indirectly, to a
211computer system approved by the department.
212     (5)  Video lottery games may be played at an authorized
213video lottery retailer's facility regardless of whether the
214retailer is conducting a pari-mutuel event.
215     (6)  Income derived from video lottery operations is not
216subject to s. 24.121. The allocation of net terminal income
217derived from video lottery games shall be as follows:
218     (a)  Forty-two percent shall be remitted to the Video
219Lottery Administrative Trust Fund for transfer to the Education
220Enhancement Trust Fund. The $2 million annual fee paid by each
221permitholder pursuant to s. 24.105(27) shall be credited back to
222the permitholder on a weekly basis out of the Video Lottery
223Administrative Trust Fund until the total $2 million is
224credited. However, weekly credits may not exceed $100,000 per
225week per permitholder.
226     (b)  Seventy-five hundredths percent shall be remitted to
227the Video Lottery Administrative Trust Fund for transfer to the
228Administrative Trust Fund. Twenty-five percent of the 0.75
229percent, with a cap not to exceed $5 million per year, shall be
230transferred to the Department of Children and Family Services
231for the establishment and administration of a treatment program
232for compulsive gambling.
233     (c)  Fifty-seven and twenty-five hundredths percent shall
234be retained by the video lottery retailer as compensation, and
235of that amount:
236     1.  Six percent of the retailer's net terminal income shall
237be distributed by the video lottery retailer as purses for live
238performances conducted as a part of the video lottery retailer's
239pari-mutuel meet in accordance with chapter 550; however, if the
240video lottery retailer holds a license pursuant to s. 550.6308,
241the 6 percent shall be distributed as thoroughbred breeders'
242awards and stallion awards and awards to owners of registered
243Florida-bred thoroughbred horses under ss. 550.26165 and
244550.2625(3), subject to the fee provided in s. 550.2625(3).
245     2.  Six and seventy-five hundredths percent of the
246retailer's net terminal income shall be remitted to the Video
247Lottery Administrative Trust Fund for transfer to the Video
248Lottery Purse Trust Fund, to be distributed pursuant to s.
24924.132.
250     (7)  The allocation provided in subsection (6) shall be
251made weekly. Amounts allocated pursuant to paragraphs (6)(a) and
252(b) shall be remitted to the department by electronic transfer
253within 24 hours after the allocation is determined. If live
254meets were conducted by the video lottery retailer during the
255weekly period for which the allocation is made, the portion of
256the allocation to be distributed as purses under paragraph
257(6)(c) shall be paid as purses for those live meets. If live
258meets were not conducted at the pari-mutuel facility during the
259weekly period for which the allocation is made, the distribution
260of purse money shall be made during the next ensuing meet
261following the weekly period in which the net terminal income is
262earned. The accumulated amount to be distributed as purses
263during the next ensuing meet shall be distributed weekly during
264the permitholder's next race meeting in an amount determined by
265dividing the amount to be distributed by the number of
266performances approved for the permitholder pursuant to its
267annual license and multiplying that amount by the number of
268performances conducted each week. Any interest income on funds
269required to be distributed under paragraph (6)(c) prior to
270distribution of the funds as purses shall be distributed by the
271video lottery retailer as purses for live performances conducted
272at the video lottery retailer's pari-mutuel facility or a
273facility authorized under s. 550.475.
274     (8)  Any person who intentionally manipulates or attempts
275to manipulate the outcome, payoff, or operation of a video
276lottery terminal by physical or electronic tampering or other
277means commits a felony of the third degree, punishable as
278provided in s. 775.082, s. 775.083, or s. 775.084.
279     (9)  Notwithstanding s. 24.115, each video lottery retailer
280is responsible for payment of video lottery prizes.
281     (10)  In the area or room in a facility in which a video
282lottery terminal is placed, the video lottery retailer shall
283also place video monitors displaying live races or games being
284conducted in that facility. If live races or games are not being
285conducted at the facility, any simulcast races or games that are
286displayed otherwise in the facility shall be displayed. In each
287area or room, the retailer shall also provide a means by which
288patrons may wager on pari-mutuel activity.
289     Section 6.  Section 24.128, Florida Statutes, is created to
290read:
291     24.128  Licensure of video lottery terminal vendors.--Video
292lottery terminal vendors shall be licensed by the department by
293July 1, 2004. The department may adopt emergency rules under s.
294120.536(1) and s. 120.54(4) to implement this section. The
295department may not license a person as a video lottery terminal
296vendor who has an interest in a video lottery retailer or a
297business relationship with a video lottery retailer other than
298as a vendor or lessor of video lottery terminals.
299     Section 7.  Section 24.129, Florida Statutes, is created to
300read:
301     24.129  Local zoning of pari-mutuel facilities.--The
302installation, operation, or use of a video lottery on any
303property where pari-mutuel operations were or would have been
304lawful under any county or municipal zoning ordinance on July 1,
3052003, does not change the character of the use of such property
306and may not be prohibited by any local land use or zoning
307ordinance.
308     Section 8.  Section 24.130, Florida Statutes, is created to
309read:
310     24.130  Video lottery terminals.--
311     (1)  Video lottery terminals may not be offered for use or
312play in this state unless approved by the department.
313     (2)  Each video lottery terminal approved for use in this
314state shall:
315     (a)  Be protected against manipulation to affect the random
316probabilities of winning plays.
317     (b)  Have one or more mechanisms that accept currency,
318coins, tokens, vouchers, or anything of value in exchange for
319game credits. Such mechanisms must be designed to prevent
320players from obtaining currency, coins, tokens, vouchers, or
321anything of value or from obtaining game credits by physical
322tampering.
323     (c)  Be capable of suspending play until reset at the
324direction of the department as a result of physical tampering.
325     (d)  Be capable of being linked to a central computer
326communications system to audit the operation, financial data,
327and program information, as required by the department.
328     Section 9.  Section 24.131, Florida Statutes, is created to
329read:
330     24.131  Video lottery terminal training program.--
331     (1)  Each licensed video lottery terminal vendor shall
332submit a training program for the service and maintenance of
333terminals and equipment for approval by the department. The
334training program must include an outline of the training
335curriculum; a list of instructors and their qualifications; a
336copy of the instructional materials; and the dates, times, and
337location of training classes. A service and maintenance program
338may not be held unless approved by the department.
339     (2)  Each video lottery terminal service employee must
340complete the requirements of the manufacturer's training program
341before performing service, maintenance, or repairs on video
342lottery terminals or associated equipment. Upon the successful
343completion of the training program by an employee, the
344department shall issue a certificate authorizing the employee to
345service, maintain, and repair video lottery terminals and
346associated equipment. A certificate of completion may not be
347issued to a person until the department determines that such
348person has completed the required training. Before being
349certified as a video lottery terminal service employee, a person
350must pass a background investigation conducted by the
351department. The department may revoke certification upon finding
352that a person is in violation of this chapter or a department
353rule.
354     (3)  The department may adopt rules regarding the training,
355qualifications, and certification of video lottery terminal
356service employees.
357     Section 10.  Section 24.132, Florida Statutes, is created
358to read:
359     24.132  Administration of the Video Lottery Purse Trust
360Fund.--
361     (1)  The proceeds of the Video Lottery Purse Trust Fund
362shall be distributed to pari-mutuel permitholders to be
363distributed as purses at their respective pari-mutuel facilities
364as follows:
365     (a)  Fifty-eight percent shall be paid to holders of valid
366thoroughbred racing permits.
367     (b)  Eight percent shall be paid to holders of valid
368harness racing permits.
369     (c)  Seven percent shall be paid to holders of valid jai
370alai permits.
371     (d)  Twenty-seven percent shall be paid to holders of valid
372greyhound racing permits.
373     (2)  Distributions to permitholders under subsection (1)
374shall be determined by dividing the amounts paid in purses
375during the previous fiscal year by the amount of purses by those
376permitholders paid by all permitholders of the same class of
377permits statewide during the previous fiscal year.
378     (3)  All proceeds distributed under this section are in
379addition to and supplement the other funds set forth in this
380chapter and chapter 550 for use as purses, awards, and, in the
381case of jai alai, player compensation.
382     (4)  Ten percent of the amounts distributed pursuant to
383this section and s. 24.127(6)(c) to persons holding valid
384greyhound racing permits shall be distributed as additional
385purses on all live races at each facility for Florida-bred
386greyhounds in a manner similar to the distribution of regular
387purses.
388     (5)  Ten percent of the amounts distributed pursuant to
389this section and s. 24.127(6)(c)1. to persons holding valid
390harness racing permits shall be distributed for payment of
391breeders' awards, stallion awards, and stallion stakes, and for
392additional expenditures, including, but not limited to, medical,
393dental, surgical, life, funeral, and disability insurance and
394retirement benefits for occupational licensees who work at
395tracks in this state in which harness horse races are conducted
396pursuant to ss. 550.26165 and 550.2625, subject to the fee
397provided in s. 550.2625(4).
398     (6)  Ten percent of the amounts distributed pursuant to
399this section and s. 24.127(6)(c)2. to persons holding valid
400thoroughbred racing permits shall be distributed as thoroughbred
401breeders' awards and stallion awards and awards to owners of
402registered Florida-bred thoroughbred horses pursuant to ss.
403550.26165 and 550.2625(3), subject to the fee provided in s.
404550.2625(3).
405     (7)  The department may adopt rules to provide for the
406equitable distribution of funds by permitholders for purses,
407awards, or jai alai player compensation.
408     Section 11.  Section 24.133, Florida Statutes, is created
409to read:
410     24.133  Notice of availability of assistance for compulsive
411gambling required.--
412     (1)  The owner of each facility at which video lottery
413games are conducted shall post signs with the statement:
414
415"IF YOU OR SOMEONE YOU KNOW HAS A GAMBLING PROBLEM, HELP IS
416AVAILABLE, CALL 1-800-426-7711."
417
418     (2)  The department may approve additional toll-free
419numbers to ensure compliance with this section. The signs must
420be posted within 50 feet of each entrance and within 60 feet of
421each credit location within the facility.
422     Section 12.  Subsection (24) of section 212.02, Florida
423Statues, is amended to read:
424     212.02  Definitions.--The following terms and phrases when
425used in this chapter have the meanings ascribed to them in this
426section, except where the context clearly indicates a different
427meaning:
428     (24)  "Coin-operated amusement machine" means any machine
429operated by coin, slug, token, coupon, or similar device for the
430purposes of entertainment or amusement.  The term includes, but
431is not limited to, coin-operated pinball machines, music
432machines, juke boxes, mechanical games, video games, arcade
433games, billiard tables, moving picture viewers, shooting
434galleries, and all other similar amusement devices. However, the
435term does not include a video lottery terminal operated pursuant
436to chapter 24.
437     Section 13.  Section 24.134, Florida Statutes, is created
438to read:
439     24.134  Compulsive gambling program.--The Mental Health
440Program Office within the Department of Children and Family
441Services shall establish a program for public education,
442awareness, and training regarding problem and compulsive
443gambling and the treatment and prevention of problem and
444compulsive gambling. The program shall include:
445     (1)  Maintenance of a compulsive gambling advocacy
446organization's toll-free, problem-gambling telephone number to
447provide crisis counseling and referral services to families
448experiencing difficulty as a result of problem or compulsive
449gambling.
450     (2)  The promotion of public awareness regarding the
451recognition and prevention of problem or compulsive gambling.
452     (3)  Facilitation, through inservice training and other
453means, of the availability of effective assistance programs for
454problem and compulsive gamblers and family members affected by
455problem and compulsive gambling.
456     (4)  Studies to identify adults and juveniles in this state
457who are or are at risk of becoming problem or compulsive
458gamblers.
459     Section 14.  Section 24.136, Florida Statutes, is created
460to read:
461     24.136  Licensure of video lottery retailer.--A video
462lottery retailer is entitled to a caterer's license pursuant to
463s. 565.02 on days in which the pari-mutuel facility is open to
464the public for video lottery play as authorized by this chapter.
465     Section 15.  This act shall take effect upon becoming a
466law.


CODING: Words stricken are deletions; words underlined are additions.