HB 1451

1	A bill to be entitled
2	An act relating to operation of the Florida Lottery;
3	amending s. 20.317, F.S.; clarifying provisions concerning
4	regional offices; amending s. 24.101, F.S.; revising a
5	reference; amending s. 24.102, F.S.; revising provisions
6	relating to legislative intent to provide for operation of
7	the lottery under a concession agreement; amending s.
8	24.103, F.S.; providing additional definitions; amending
9	s. 24.104, F.S.; revising language concerning the purpose
10	of the Department of the Lottery to permit operation of
11	the lottery by the state through a concessionaire;
12	amending s. 24.105, F.S.; revising provisions concerning
13	the powers and duties of the Department of the Lottery to
14	allow for possible operation of the lottery through a
15	concessionaire; providing that specified provisions apply
16	whether the department operates the lottery directly or
17	through a concessionaire; deleting obsolete language;
18	amending s. 24.107, F.S.; revising provisions concerning
19	lottery security to conform to the possible operation of
20	the lottery through a concessionaire; amending ss. 24.108
21	and 24.111, F.S.; revising provisions to conform to the
22	possible operation of the lottery through a
23	concessionaire; creating s. 24.1115, F.S.; providing for a
24	concession agreement under which the lottery may be
25	operated; providing intent; providing definitions;
26	limiting the duration of such an agreement; providing
27	limits on the games that may be offered under such an
28	agreement; providing for an initial payment to the
29	department by a concessionaire; providing for royalty
30	payments by a concessionaire; providing for collection of
31	funds in excess of a specified baseline growth percentage
32	to ensure that the concessionaire does not earn excess
33	revenue; providing requirements for the contents of a
34	concession agreement; requiring periodic investigations of
35	the performance by a concessionaire; providing for a
36	request for qualifications process to select a
37	concessionaire; providing for the public records status of
38	specified materials under existing exemptions; providing
39	for negotiations between one or more offerors and the
40	department; providing selection procedures; requiring a
41	public hearing; providing for designation of a
42	concessionaire by the Governor; providing for status of
43	debt offering by the concessionaire; providing for a time
44	period for challenges to designation of a concessionaire;
45	providing department powers; providing that there is no
46	prohibition on additional legislative authorization of
47	other forms of gambling; amending s. 24.112, F.S.;
48	revising provisions concerning retailers of lottery
49	tickets to conform to the possible operation of the
50	lottery through a concessionaire; amending s. 24.113,
51	F.S.; providing that provisions concerning minority
52	participation also apply if the lottery is operated
53	through a concessionaire; amending ss. 24.114, 24.115,
54	24.1153, 24.117, 24.118, and 24.120, F.S.; revising
55	provisions to conform to the possible operation of the
56	lottery through a concessionaire; amending 24.121, F.S.;
57	revising provisions to conform to the possible operation
58	of the lottery through a concessionaire; providing for a
59	minimum allocation of proceeds received under a concession
60	agreement to the Florida Bright Futures Scholarship
61	Program; amending ss. 24.122, 24.123, and 24.124, F.S.;
62	revising provisions to conform to the possible operation
63	of the lottery through a concessionaire; providing an
64	effective date.
65
66	Be It Enacted by the Legislature of the State of Florida:
67
68	Section 1.  Subsection (3) of section 20.317, Florida
69	Statutes, is amended to read:
70	20.317  Department of the Lottery.--There is created a
71	Department of the Lottery.
72	(3)  The headquarters of the department shall be located in
73	Tallahassee. However, the department may establish such regional
74	offices throughout the state as the secretary deems necessary to
75	perform its duties concerning the efficient operation of the
76	state lottery.
77	Section 2.  Section 24.101, Florida Statutes, is amended to
78	read:
79	24.101  Short title.--This chapter act may be cited as the
80	"Florida Public Education Lottery Act."
81	Section 3.  Section 24.102, Florida Statutes, is amended to
82	read:
83	24.102  Purpose and intent.--
84	(1)  The purpose of this chapter act is to implement s. 15,
85	Art. X of the State Constitution in a manner that enables the
86	people of the state to benefit from significant additional
87	moneys for education and also enables the people of the state to
88	play the best lottery games available.
89	(2)  The intent of the Legislature is:
90	(a)  That the net proceeds of lottery games conducted
91	pursuant to this chapter act be used to support improvements in
92	public education and that such proceeds not be used as a
93	substitute for existing resources for public education.
94	(b)  That the lottery games be operated by a department of
95	state government that functions as much as possible in the
96	manner of an entrepreneurial business enterprise or through a
97	concession agreement with an entrepreneurial business enterprise
98	operating with oversight by the department. The Legislature
99	recognizes that the operation of a lottery is a unique activity
100	for state government and that structures and procedures
101	appropriate to the performance of other governmental functions
102	are not necessarily appropriate to the operation of a state
103	lottery.
104	(c)  That the lottery games be operated by a self-
105	supporting, revenue-producing department or through a concession
106	agreement with an entrepreneurial business enterprise under
107	government oversight.
108	(d)  That the department be accountable to the Legislature
109	and the people of the state through a system of audits and
110	reports and through compliance with financial disclosure, open
111	meetings, and public records laws and that any entity operating
112	the lottery under a concession agreement must also be
113	accountable to the Legislature and the people of the state.
114	Section 4.  Section 24.103, Florida Statutes, is amended to
115	read:
116	24.103  Definitions.--As used in this chapter act:
117	(1)  "Concession agreement" means that agreement entered
118	into pursuant to which the state may grant a license or other
119	contractual right to manage or operate the lottery on the
120	state's behalf to a concessionaire and further pursuant to which
121	the concessionaire may receive certain lottery ticket or share
122	sales and related proceeds in consideration of the payment of a
123	fee or fees to the state.
124	(2)  "Concessionaire " means an entity that manages or
125	operates the lottery on behalf of the state under a concession
126	agreement.
127	(3)(1)  "Department" means the Department of the Lottery.
128	(4)  "Major procurement" means a procurement for a contract
129	for the printing of tickets for use in any lottery game,
130	consultation services for the startup of the lottery, any goods
131	or services involving the official recording for lottery game
132	play purposes of a player's selections in any lottery game
133	involving player selections, any goods or services involving the
134	receiving of a player's selection directly from a player in any
135	lottery game involving player selections, any goods or services
136	involving the drawing, determination, or generation of winners
137	in any lottery game, the security report services provided for
138	in this chapter act, or any goods and services relating to
139	marketing and promotion that which exceed a value of $25,000.
140	(5)(3)  "Person" means any individual, firm, association,
141	joint adventure, partnership, estate, trust, syndicate,
142	fiduciary, corporation, or other group or combination and shall
143	include any agency or political subdivision of the state.
144	(6)(5)  "Retailer" means a person who sells lottery tickets
145	on behalf of the department or the concessionaire pursuant to a
146	contract.
147	(7)(2)  "Secretary" means the secretary of the department.
148	(8)(6)  "Vendor" means a person who provides or proposes to
149	provide goods or services to the department, but does not
150	include an employee of the department, a retailer, or a state
151	agency.
152	Section 5.  Section 24.104, Florida Statutes, is amended to
153	read:
154	24.104  Department; purpose.--The purpose of the department
155	is to operate the state lottery as authorized by s. 15, Art. X
156	of the State Constitution directly or through a concessionaire
157	so as to maximize revenues in a manner consonant with the
158	dignity of the state and the welfare of its citizens.
159	Section 6.  Subsections (2), (4), (6), (7), (8), (9), (11),
160	(15), (17), (18), and (19) of section 24.105, Florida Statutes,
161	are amended to read:
162	24.105  Powers and duties of department.--The department
163	shall:
164	(2)  Supervise and administer the operation of the lottery
165	itself or through a concessionaire in accordance with the
166	provisions of this chapter act and rules adopted pursuant
167	thereto.
168	(4)  Submit monthly and annual reports to the Governor, the
169	Chief Financial Officer, the President of the Senate, and the
170	Speaker of the House of Representatives disclosing the total
171	lottery revenues, prize disbursements, and other expenses of the
172	department during the preceding month or, if the lottery is
173	operated under a concession agreement, comparable information
174	provided by the concessionaire. The annual report shall
175	additionally describe the organizational structure of the
176	department, including its hierarchical structure, and shall
177	identify the divisions and bureaus created by the secretary and
178	summarize the departmental functions performed by each.
179	(6)  Maintain weekly or more frequent records of lottery
180	transactions, including the distribution of tickets to
181	retailers, revenues received, claims for prizes, prizes paid,
182	and other financial transactions of the department. If the
183	lottery is operated under a concession agreement, the agreement
184	shall require the concessionaire to maintain comparable
185	information.
186	(7)  Make a continuing study of the lottery to ascertain
187	any defects of this chapter act or rules adopted thereunder
188	which could result in abuses in the administration of the
189	lottery; make a continuing study of the operation and the
190	administration of similar laws in other states and of federal
191	laws that which may affect the lottery; and, if the department
192	directly operates the lottery, make a continuing study of the
193	reaction of the public to existing and potential features of the
194	lottery.
195	(8)  If the lottery is operated directly by the department,
196	conduct such market research as is necessary or appropriate,
197	which may include an analysis of the demographic characteristics
198	of the players of each lottery game and an analysis of
199	advertising, promotion, public relations, incentives, and other
200	aspects of communications.
201	(9)  Adopt rules governing the establishment and operation
202	of the state lottery, including:
203	(a)1.  If the lottery is operated directly by the
204	department, the type of lottery games to be conducted.
205	2.  Regardless of whether the lottery is operated directly
206	by the department or through a concessionaire, except that:
207	a.1.  No name of an elected official shall appear on the
208	ticket or play slip of any lottery game or on any prize or on
209	any instrument used for the payment of prizes, unless such prize
210	is in the form of a state warrant.
211	b.2.  No coins or currency shall be dispensed from any
212	electronic computer terminal or device used in any lottery game.
213	c.3.  Other than as provided in sub-subparagraph d.
214	subparagraph 4., no terminal or device may be used for any
215	lottery game that which may be operated solely by the player
216	without the assistance of the retailer.
217	d.4.  The only player-activated machine that which may be
218	utilized is a machine that which dispenses instant lottery game
219	tickets following the insertion of a coin or currency by a
220	ticket purchaser. To be authorized a machine must: be under the
221	supervision and within the direct line of sight of the lottery
222	retailer to ensure that the machine is monitored and only
223	operated by persons at least 18 years of age and; be capable of
224	being electronically deactivated by the retailer to prohibit use
225	by persons less than 18 years of age through the use of a
226	lockout device that maintains the machine's deactivation for a
227	period of no less than 5 minutes unless the machine uses a
228	method of verifying the age of an operator that the department
229	certifies is equivalent or superior to line-of-sight monitoring
230	and lockout by the retailer. Such a machine must also; and be
231	designed to prevent its use or conversion for use in any manner
232	other than the dispensing of instant lottery tickets. Authorized
233	machines may dispense change to players purchasing tickets but
234	may not be utilized for paying the holders of winning tickets of
235	any kind. At least one clerk must be on duty at the lottery
236	retailer while the machine is in operation. However, at least
237	two clerks must be on duty at any lottery location that which
238	has violated s. 24.1055.
239	(b)  If the lottery is operated directly by the department,
240	the sales price of tickets.
241	(c)  If the lottery is operated directly by the department,
242	the number and sizes of prizes.
243	(d)  If the lottery is operated directly by the department,
244	the method of selecting winning tickets. However, regardless of
245	whether the lottery is operated directly by the department or
246	through a concessionaire, if a lottery game involves a drawing,
247	the drawing shall be public and witnessed by an accountant
248	employed by an independent certified public accounting firm. The
249	equipment used in the drawing shall be inspected before and
250	after the drawing.
251	(e)  If the lottery is operated directly by the department,
252	the manner of payment of prizes to holders of winning tickets.
253	(f)  If the lottery is operated directly by the department,
254	the frequency of drawings or selections of winning tickets.
255	(g)  If the lottery is operated directly by the department,
256	the number and type of locations at which tickets may be
257	purchased.
258	(h)  If the lottery is operated directly by the department,
259	the method to be used in selling tickets.
260	(i)  If the lottery is operated directly by the department,
261	the manner and amount of compensation of retailers.
262	(j)  Such other matters necessary or desirable for the
263	efficient or economical operation of the lottery directly by the
264	department or for the convenience of the public.
265	(11)  In the selection of games and method of selecting
266	winning tickets, be sensitive to the impact of the lottery upon
267	the pari-mutuel industry and, accordingly, the department or the
268	concessionaire may use for any game the theme of horseracing,
269	dogracing, or jai alai and may allow a lottery game to be based
270	upon a horserace, dograce, or jai alai activity so long as the
271	outcome of such lottery game is determined entirely by chance.
272	(15)  Or the concessionaire, if any, shall have the
273	authority to charge fees to persons applying for contracts as
274	vendors or retailers, which fees are reasonably calculated to
275	cover the costs of investigations and other activities related
276	to the processing of the application.
277	(17)  Or the concessionaire, if any, shall, in accordance
278	with the provisions of this chapter act, enter into contracts
279	with retailers so as to provide adequate and convenient
280	availability of tickets to the public for each game.
281	(18)  Or the concessionaire, if any, shall have the
282	authority to enter into agreements with other states for the
283	operation and promotion of a multistate lottery if such
284	agreements are in the best interest of the state lottery. The
285	authority conferred by this subsection is not effective until 1
286	year after the first day of lottery ticket sales.
287	(19)  Employ division directors and other staff as may be
288	necessary to carry out the provisions of this chapter act;
289	however:
290	(a)  No person shall be employed by the department who has
291	been convicted of, or entered a plea of guilty or nolo
292	contendere to, a felony committed in the preceding 10 years,
293	regardless of adjudication, unless the department determines
294	that:
295	1.  The person has been pardoned or his or her civil rights
296	have been restored; or
297	2.  Subsequent to such conviction or entry of plea the
298	person has engaged in the kind of law-abiding commerce and good
299	citizenship that would reflect well upon the integrity of the
300	lottery.
301	(b)  No officer or employee of the department having
302	decisionmaking authority shall participate in any decision
303	involving any vendor or retailer with whom the officer or
304	employee has a financial interest. No such officer or employee
305	may participate in any decision involving any vendor or retailer
306	with whom the officer or employee has discussed employment
307	opportunities without the approval of the secretary or, if such
308	officer is the secretary, without the approval of the Governor.
309	Any officer or employee of the department shall notify the
310	secretary of any such discussion or, if such officer is the
311	secretary, he or she shall notify the Governor. A violation of
312	this paragraph is punishable in accordance with s. 112.317.
313	(c)  No officer or employee of the department who leaves
314	the employ of the department shall represent any vendor or
315	retailer or the concessionaire, if any, before the department
316	regarding any specific matter in which the officer or employee
317	was involved while employed by the department, for a period of 1
318	year following cessation of employment with the department. A
319	violation of this paragraph is punishable in accordance with s.
320	112.317.
321	(d)  The department shall establish and maintain a
322	personnel program for its employees, including a personnel
323	classification and pay plan which may provide any or all of the
324	benefits provided in the Senior Management Service or Selected
325	Exempt Service. Each officer or employee of the department shall
326	be a member of the Florida Retirement System. The retirement
327	class of each officer or employee shall be the same as other
328	persons performing comparable functions for other agencies.
329	Employees of the department shall serve at the pleasure of the
330	secretary and shall be subject to suspension, dismissal,
331	reduction in pay, demotion, transfer, or other personnel action
332	at the discretion of the secretary. Such personnel actions are
333	exempt from the provisions of chapter 120. All employees of the
334	department are exempt from the Career Service System provided in
335	chapter 110 and, notwithstanding the provisions of s.
336	110.205(5), are not included in either the Senior Management
337	Service or the Selected Exempt Service. However, all employees
338	of the department are subject to all standards of conduct
339	adopted by rule for career service and senior management
340	employees pursuant to chapter 110. In the event of a conflict
341	between standards of conduct applicable to employees of the
342	Department of the Lottery the more restrictive standard shall
343	apply. Interpretations as to the more restrictive standard may
344	be provided by the Commission on Ethics upon request of an
345	advisory opinion pursuant to s. 112.322(3)(a), for purposes of
346	this subsection the opinion shall be considered final action.
347	(e)  No employee of a concessionaire operating the lottery
348	shall receive membership in the Florida Retirement System or any
349	other state retirement or other state employee benefits on the
350	basis of such employment.
351	Section 7.  Section 24.107, Florida Statutes, is amended to
352	read:
353	24.107  Advertising and promotion of lottery games.--
354	(1)  The Legislature recognizes the need for extensive and
355	effective advertising and promotion of lottery games. It is the
356	intent of the Legislature that such advertising and promotion be
357	consistent with the dignity and integrity of the state. In
358	advertising the value of a prize that will be paid over a period
359	of years, the department or the concessionaire, if any, may
360	refer to the sum of all prize payments over the period.
361	(2)  The department or the concessionaire, if any, may act
362	as a retailer and may conduct promotions that which involve the
363	dispensing of lottery tickets free of charge.
364	Section 8.  Subsections (2), (5), (6), and (7) of section
365	24.108, Florida Statutes, are amended to read:
366	24.108  Division of Security; duties; security report.--
367	(2)  The director and all investigators employed by the
368	division shall meet the requirements for employment and
369	appointment provided by s. 943.13 and shall satisfy the
370	requirements for certification established by the Criminal
371	Justice Standards and Training Commission pursuant to chapter
372	943. The director and such investigators shall be designated law
373	enforcement officers and shall have the power to investigate and
374	arrest for any alleged violation of this chapter act or any rule
375	adopted pursuant thereto, or any law of this state. Such law
376	enforcement officers may enter upon any premises in which
377	lottery tickets are sold, manufactured, printed, or stored
378	within the state for the performance of their lawful duties and
379	may take with them any necessary equipment, and such entry shall
380	not constitute a trespass. In any instance in which there is
381	reason to believe that a violation has occurred, such officers
382	have the authority, without warrant, to search and inspect any
383	premises where the violation is alleged to have occurred or is
384	occurring. Any such officer may, consistent with the United
385	States and Florida Constitutions, seize or take possession of
386	any papers, records, tickets, currency, or other items related
387	to any alleged violation.
388	(5)  The Department of Law Enforcement shall provide
389	assistance in obtaining criminal history information relevant to
390	investigations required for honest, secure, and exemplary
391	lottery operations, and such other assistance as may be
392	requested by the secretary and agreed to by the executive
393	director of the Department of Law Enforcement. Any other state
394	agency, including the Department of Business and Professional
395	Regulation and the Department of Revenue, shall, upon request,
396	provide the Department of the Lottery with any information
397	relevant to any investigation conducted pursuant to this chapter
398	act. The Department of the Lottery shall maintain the
399	confidentiality of any confidential information it receives from
400	any other agency. The Department of the Lottery shall reimburse
401	any agency for the actual cost of providing any assistance
402	pursuant to this subsection.
403	(6)  If the lottery is operated directly by the department,
404	the division shall monitor ticket validation and lottery
405	drawings.
406	(7)(a)  If the lottery is operated directly by the
407	department After the first full year of sales of tickets to the
408	public, or sooner if the secretary deems necessary, the
409	department shall, as it deems appropriate, but at least once
410	every 2 years engage an independent firm experienced in security
411	procedures, including, but not limited to, computer security and
412	systems security, to conduct a comprehensive study and
413	evaluation of all aspects of security in the operation of the
414	department.
415	(b)  The portion of the security report containing the
416	overall evaluation of the department in terms of each aspect of
417	security shall be presented to the Governor, the President of
418	the Senate, and the Speaker of the House of Representatives. The
419	portion of the security report containing specific
420	recommendations shall be confidential and shall be presented
421	only to the secretary, the Governor, and the Auditor General;
422	however, upon certification that such information is necessary
423	for the purpose of effecting legislative changes, such
424	information shall be disclosed to the President of the Senate
425	and the Speaker of the House of Representatives, who may
426	disclose such information to members of the Legislature and
427	legislative staff as necessary to effect such purpose. However,
428	any person who receives a copy of such information or other
429	information that which is confidential pursuant to this chapter
430	act or rule of the department shall maintain its
431	confidentiality. The confidential portion of the report is
432	exempt from the provisions of s. 119.07(1) and s. 24(a), Art. I
433	of the State Constitution.
434	(c)  Thereafter, similar studies of security shall be
435	conducted as the department deems appropriate but at least once
436	every 2 years.
437	Section 9.  Subsection (1) and paragraph (h) of subsection
438	(2) of section 24.111, Florida Statutes, are amended to read:
439	24.111  Vendors; disclosure and contract requirements.--
440	(1)  The department may enter into contracts for the
441	purchase, lease, or lease-purchase of such goods or services as
442	are necessary for effectuating the purposes of this chapter act.
443	The department may not contract with any person or entity for
444	the total operation and administration of the state lottery
445	established by this chapter as provided in s. 24.1115 or act but
446	may make procurements that which integrate functions such as
447	lottery game design, supply of goods and services, and
448	advertising. In all procurement decisions, the department shall
449	take into account the particularly sensitive nature of the state
450	lottery and shall consider the competence, quality of product,
451	experience, and timely performance of the vendors in order to
452	promote and ensure security, honesty, fairness, and integrity in
453	the operation and administration of the lottery and the
454	objective of raising net revenues for the benefit of the public
455	purpose described in this chapter act.
456	(2)  The department shall investigate the financial
457	responsibility, security, and integrity of each vendor with
458	which it intends to negotiate a contract for major procurement.
459	Such investigation may include an investigation of the financial
460	responsibility, security, and integrity of any or all persons
461	whose names and addresses are required to be disclosed pursuant
462	to paragraph (a). Any person who submits a bid, proposal, or
463	offer as part of a major procurement must, at the time of
464	submitting such bid, proposal, or offer, provide the following:
465	(h)  If the department operates the lottery directly, it
466	The department shall lease all instant ticket vending machines.
467
468	The department shall not contract with any vendor who fails to
469	make the disclosures required by this subsection, and any
470	contract with a vendor who has failed to make the required
471	disclosures shall be unenforceable. Any contract with any vendor
472	who does not comply with such requirements for periodically
473	updating such disclosures during the tenure of such contract as
474	may be specified in such contract may be terminated by the
475	department. This subsection shall be construed broadly and
476	liberally to achieve the ends of full disclosure of all
477	information necessary to allow for a full and complete
478	evaluation by the department of the competence, integrity,
479	background, and character of vendors for major procurements.
480	Section 10.  Section 24.1115, Florida Statutes, is created
481	to read:
482	24.1115  Concession agreement.--
483	(1)  In construing this section, it is the intent of the
484	Legislature that the concessionaire be accountable to the
485	Legislature and the people of this state through a system of
486	audits and reports and by complying with the financial
487	disclosure requirements of this section. The powers conferred by
488	this section are in addition and supplemental to the powers
489	conferred by any other law. If any other law or rule is
490	inconsistent with this section, this section is controlling as
491	to any concession agreement entered into under this section.
492	(2)  As used in this section, the term:
493	(a)  "Offeror" means a person that responds to a request
494	for qualifications under this section.
495	(b)  "Request for qualifications" means all materials and
496	documents prepared by the department to solicit the following
497	from offerors:
498	1.  Statements of qualifications.
499	2.  Proposals to enter into a management agreement.
500	(c)  "Selected offer" means the final offer of an offeror
501	that is the preliminary selection to be the concessionaire for
502	the lottery under subsection (12).
503	(3)(a)  This section contains full and complete authority
504	for a concession agreement between the department and a
505	concessionaire and any rules adopted thereunder. No law,
506	procedure, proceeding, publication, notice, consent, approval,
507	order, or act by the department or any other officer,
508	department, agency, or instrumentality of the state or any
509	political subdivision is required for the department to enter
510	into a concession agreement under this section.
511	(b)  This section contains full and complete authority for
512	the department to approve any subcontracts entered into by a
513	concessionaire under the terms of a management agreement.
514	(4)  Subject to the other provisions of this section, the
515	department may enter into a concession agreement with a
516	concessionaire for a term not to exceed 30 years.
517	(5)  The department may not enter into a concession
518	agreement that authorizes a concessionaire to operate any of the
519	following games or a game simulating any of the following games:
520	(a)  Video lottery games.
521	(b)  Pari-mutuel wagering on any form of racing.
522	(c)  A game in which winners are selected on the results of
523	a race or sporting event.
524	(d)  Any other game commonly considered to be a form of
525	gambling that is not a game or a variation of a game that the
526	department operated before the concession agreement is executed
527	or is operating on the date the concession agreement is
528	executed.
529	(6)(a)  The concession agreement must establish a
530	substantial benchmark amount. The concession agreement must
531	require the concessionaire to make an initial payment to the
532	department on the effective date of the concession agreement in
533	an amount that exceeds the benchmark amount established in the
534	management agreement.
535	(b)  The initial payment required under paragraph (a) shall
536	be deposited as provided in s. 24.121.
537	(c)  If the concessionaire fails to make any payment under
538	this section by the due date of the payment, the concession
539	agreement is terminated.
540	(7)(a)  The concession agreement must require the
541	concessionaire to pay a royalty in the amount equal to one
542	quarter of the lottery's annual profits in the last full fiscal
543	year preceding the agreement to the department four times each
544	year beginning on a date that is specified in the concession
545	agreement and that occurs during the first year after the
546	execution of the management agreement. The payments received
547	under this subsection shall be deposited as provided in s.
548	24.121.
549	(b)  The concession agreement must include the following
550	provisions to ensure that the concessionaire does not earn
551	excess revenue under the concession agreement:
552	1.  The Office of Policy and Budget in the Executive Office
553	of the Governor shall calculate the percentage rate of average
554	annual growth in gross revenue earned by the department during
555	the last 5 full state fiscal years preceding the commencement of
556	the concession agreement. For purposes of this subsection, this
557	percentage is referred to as the "baseline growth percentage".
558	2.  Beginning with the second full state fiscal year after
559	the execution of the management agreement, the Office of Policy
560	and Budget in the Executive Office of the Governor shall for
561	each state fiscal year calculate the growth, expressed as a
562	percentage, in gross revenue earned by the concessionaire under
563	the concession agreement, as compared to the preceding state
564	fiscal year.
565	3.  The department shall establish an excess payments
566	account for purposes of this paragraph. Any earnings from money
567	in the excess payments account accrue to the account. Money in
568	the excess payments account may be used only to make payments to
569	a concessionaire as required by this paragraph and to receive
570	payments from a concessionaire as required by this paragraph.
571	4.  If the percentage calculated by the Office of Policy
572	and Budget in the Executive Office of the Governor under
573	subparagraph 2. for a particular state fiscal year exceeds the
574	baseline growth percentage, the concessionaire must make an
575	additional payment to the department. The amount of the
576	additional payment for the state fiscal year is equal to the
577	gross revenue earned by the concessionaire from lottery tickets
578	in the state fiscal year multiplied by one-half the difference
579	between the percentage calculated by the Office of Policy and
580	Budget in the Executive Office of the Governor under
581	subparagraph 2. for the state fiscal year and the baseline
582	growth percentage. The department shall deposit any additional
583	payment made by the concessionaire under this subparagraph into
584	the excess payments account.
585	5.  If the baseline growth percentage exceeds the
586	percentage calculated by the Office of Policy and Budget in the
587	Executive Office of the Governor under subparagraph 2. for a
588	particular state fiscal year, the department must make a payment
589	to the concessionaire from the excess payments account. However,
590	the department is required to make a payment to the
591	concessionaire only if the excess payments account has a
592	positive balance. The amount of the payment by the department
593	for the state fiscal year is equal to the lesser of:
594	a.  The result of the gross revenue earned by the
595	concessionaire from lottery tickets in the state fiscal year
596	multiplied by one-half the difference between the baseline
597	growth percentage and the percentage calculated by the Office of
598	Policy and Budget in the Executive Office of the Governor under
599	subparagraph 2. for the state fiscal year; or
600	b.  The balance in the excess payments account.
601	6.  The concession agreement must specify the time by which
602	a payment required under this paragraph shall be made.
603	7.  If at the expiration or termination of the concession
604	agreement there is money remaining in the excess payments
605	account, it shall be transferred to the department and deposited
606	as provided in s. 24.121.
607	(8)  A concession agreement must contain the following:
608	(a)  The original term of the management agreement.
609	(b)  A requirement that the concessionaire locate its
610	principal office within this state.
611	(c)  The transition of rights and obligations from the
612	department to the concessionaire with respect to the operation
613	of the lottery, including the following:
614	1.  The right to use, or ownership of, equipment and other
615	assets used in the operation of the lottery.
616	2.  The rights and obligations under contracts with
617	retailers and vendors.
618	3.  The implementation of a comprehensive security program
619	by the concessionaire.
620	4.  The implementation of a comprehensive system of
621	internal audits.
622	5.  The implementation of a program by the concessionaire
623	to curb compulsive gambling by persons playing the lottery.
624	6.  A system for determining the following:
625	a.  The type of lottery games to be conducted.
626	b.  The method of selecting winning tickets.
627	c.  The manner of payment of prizes to holders of winning
628	tickets.
629	d.  The frequency of drawings of winning tickets.
630	e.  The method to be used in selling tickets.
631	f.  A system for verifying the validity of tickets claimed
632	to be winning tickets.
633	g.  The basis upon which retailer commissions are
634	established by the concessionaire.
635	h.  Minimum payouts.
636	7.  A requirement that advertising and promotion must be
637	consistent with the dignity and integrity of the state.
638	(d)  Guidelines to ensure that advertising and promoting of
639	the lottery by the concessionaire are not misleading and fairly
640	balance the potential benefits and the potential costs and risks
641	of playing lottery games.
642	(e)  A code of ethics for the concessionaire's officers and
643	employees.
644	(f)  Monitoring of the concessionaire's practices by the
645	department and the taking of action that the department
646	considers appropriate to ensure that the concessionaire is in
647	compliance with the terms of the concession agreement, while
648	allowing the concessionaire, unless specifically prohibited by
649	law or the concession agreement, to negotiate and sign its own
650	contracts with vendors.
651	(g)  A provision requiring the concessionaire to
652	periodically file appropriate financial statements in a form and
653	manner acceptable to the department.
654	(h)  Cash reserve requirements.
655	(i)  Procedural requirements for obtaining approval by the
656	department when a management agreement or an interest in a
657	management agreement is sold, assigned, transferred, or pledged
658	as collateral to secure financing. A management agreement or an
659	interest in a management agreement may not be sold, assigned,
660	transferred, or pledged as collateral to secure financing
661	without the approval of the department.
662	(j)  Grounds for termination of the concession agreement by
663	the department or the concessionaire.
664	(k)  Procedures for amendment of the management agreement.
665	(l)  A provision prohibiting the department from entering
666	into another concession agreement under this section as long as
667	the original concession agreement has not been terminated.
668	(m)  The transition of rights and obligations, including
669	any associated equipment or other assets used in the operation
670	of the lottery, from the concessionaire to any successor
671	concessionaire of the lottery, including the department,
672	following the termination of or foreclosure upon the management
673	agreement.
674	(n)  Ownership of all copyrights, trademarks, and service
675	marks by the department in the name of the state.
676	(o)  Minority participation as provided in s. 24.113.
677	(9)(a)  The concessionaire shall undergo a complete
678	investigation every 3 years by the department to determine
679	whether the concessionaire remains in compliance with this
680	chapter and the management agreement.
681	(b)  The concessionaire shall bear the cost of an
682	investigation or reinvestigation of the concessionaire under
683	this subsection.
684	(10)(a)  Before the department enters into a concession
685	agreement pursuant to this section, a request for qualifications
686	must be issued as set forth in this section. A request for
687	qualifications for a concession agreement may be issued in one
688	or more phases.
689	(b)  A request for qualifications must include the
690	following:
691	1.  The factors or criteria that will be used in evaluating
692	an offeror's statement of qualifications and proposal.
693	2.  A statement that a proposal must be accompanied by
694	evidence of the offeror's financial responsibility.
695	3.  A statement concerning whether discussions may be
696	conducted with the offerors for the purpose of clarification to
697	ensure full understanding of and responsiveness to the
698	solicitation requirements.
699	4.  A statement concerning any other information to be
700	considered in evaluating the offeror's qualifications and
701	proposal.
702	(c)  Notice of a request for qualifications shall be
703	published twice at least 7 calendar days apart, with the second
704	publication made at least 7 days before any initial submission
705	is due.
706	(d)  As provided in a request for qualifications,
707	discussions may be conducted with the offerors for the purpose
708	of clarification to ensure full understanding of and
709	responsiveness to the solicitation requirements.
710	(11)  The contents of proposals are competitive sealed
711	replies in response to an invitation to negotiate for purposes
712	of s. 119.071(1)(b) and are exempt from s. 119.07(1) and s.
713	24(a), Art. I of the State Constitution until disclosure of the
714	contents that are not otherwise exempt under s. 119.071 or other
715	law is required under s. 119.071(1)(b).
716	(12)(a)  The department may negotiate with one or more
717	offerors the department determines are responsible and
718	reasonably capable of managing the lottery and may seek to
719	obtain a final offer from one or more of those offerors.
720	(b)  The department shall consider the statement of
721	qualifications and the proposals to enter into a concession
722	agreement that are submitted in response to a request for
723	qualifications in making a determination under this section,
724	including the following as they apply to the offeror and its
725	partners, if any:
726	1.  Expertise, qualifications, competence, skills, and plan
727	to perform obligations under the concession agreement in
728	accordance with the management agreement.
729	2.  Financial strength, including capitalization and
730	available financial resources.
731	3.  Experience in operating government-authorized lotteries
732	and gaming and other similar projects and the quality of any
733	past or present performance on similar or equivalent
734	engagements.
735	4.  Integrity, background, and reputation.
736	(c)  The requirements set forth in paragraph (b) also apply
737	to the approval of any successor concessionaire.
738	(13)(a)  After the final offers from offerors have been
739	negotiated under subsection (12), the department shall:
740	1.  Make a preliminary selection of an offeror as the
741	concessionaire for the lottery; or
742	2.  Terminate the request for qualifications process.
743	(b)  If the department makes a preliminary selection of the
744	concessionaire under this subsection, the department shall
745	schedule a public hearing on the preliminary selection and
746	provide public notice of the hearing at least 7 days before the
747	hearing. The notice must include the following:
748	1.  The date, time, and place of the hearing.
749	2.  The subject matter of the hearing.
750	3.  A brief description of the concession agreement to be
751	awarded.
752	4.  The identity of the offeror that has been preliminarily
753	selected as the concessionaire .
754	5.  The address and telephone number of the department.
755	6.  A statement indicating that, subject to subsection
756	(11), and except for those parts that are confidential under s.
757	s. 119.071 or other applicable law, the selected offer and an
758	explanation of the basis upon which the preliminary selection
759	was made are available for public inspection and copying at the
760	principal office of the department during regular business hours
761	and, to the extent feasible, on the Internet.
762	(c)  Subject to subsection (11), and except for those parts
763	that are confidential under s. s. 119.071 or other applicable
764	law, the selected offer and a written explanation of the basis
765	upon which the preliminary selection was made shall be made
766	available for inspection and copying in accordance with s.
767	119.07 and, to the extent feasible, on the Internet at least 7
768	calendar days before the hearing scheduled under this section.
769	(d)  At the hearing, the department shall allow the public
770	to be heard on the preliminary selection.
771	(14)(a)  After the hearing required under subsection (13),
772	the department shall determine if a concession agreement should
773	be entered into with the offeror that submitted the selected
774	offer. If the department makes a favorable determination, the
775	department shall submit the determination to the Governor.
776	(b)  After review of the department's determination, the
777	Governor may accept or reject the department's determination. If
778	the Governor accepts the department's determination, the
779	Governor shall designate the offeror who submitted the selected
780	offer as the concessionaire for the lottery.
781	(c)  After the Governor designates the concessionaire, the
782	department may execute a concession agreement with the
783	designated concessionaire.
784	(15)  The concessionaire may finance its obligations with
785	respect to the lottery and the concession agreement in the
786	amounts and upon the terms and conditions determined by the
787	concessionaire. However, any bonds, debt, other securities, or
788	other financing issued for the purposes of this section shall
789	not be considered to constitute a debt of the state or any
790	political subdivision of the state or a pledge of the faith and
791	credit of the state or any political subdivision of the state.
792	(16)  An action to contest the validity of a concession
793	agreement entered into under this section may not be brought
794	after the 15th day after the publication of the notice of the
795	designation of the concessionaire under the concession agreement
796	as provided in subsection (14).
797	(17)(a)  The department must use appropriate experts and
798	professionals needed to conduct a competitive bidding proceeding
799	as required under this section and may use the services of
800	outside professionals to the extent necessary to carry out its
801	obligations under this section.
802	(b)  The department may exercise any powers provided under
803	this section in participation or cooperation with any other
804	governmental entity and enter into any contracts to facilitate
805	that participation or cooperation without compliance with any
806	other statute.
807	(c)  The department may make and enter into all contracts
808	and agreements necessary or incidental to the performance of the
809	department's duties under this section and the execution of the
810	department's powers under this section. These contracts or
811	agreements are not subject to any approval by any other
812	governmental entity and may be for any term of years and contain
813	any terms that are considered reasonable by the department.
814	(d)  The department may make and enter into all contracts
815	and agreements with a state agency necessary or incidental to
816	the performance of the duties and the execution of the powers
817	granted to the department or the state agency in accordance with
818	this section or the management agreement. These contracts or
819	agreements are not subject to any approvals by any other
820	governmental entity and may be for any term of years and contain
821	any terms that are considered reasonable by the department or
822	the state agency.
823	(18)(a)  The department may not sell the authorization to
824	operate the lottery.
825	(b)  Any tangible personal property used exclusively in
826	connection with the lottery that is owned by the department and
827	leased to the concessionaire shall be owned by the department in
828	the name of the state and shall be considered to be public
829	property devoted to an essential public and governmental
830	function.
831	(c)  Any bonds, debt, other securities, or other financing
832	issued by the concessionaire to finance its obligations with
833	respect to the concession agreement shall not be considered to
834	constitute a debt of the state or any political subdivision of
835	the state or a pledge of the faith and credit of the state or
836	any political subdivision.
837	(19)  The department may exercise any of its powers under
838	this chapter or any other law as necessary or desirable for the
839	execution of the department's powers under this section.
840	(20)  Neither this section nor any concession agreement
841	entered into under this section prohibits the Legislature from
842	authorizing forms of gambling that are not in direct competition
843	with the lottery.
844	Section 11.  Section 24.112, Florida Statutes, is amended
845	to read:
846	24.112  Retailers of lottery tickets.--
847	(1)  If the department directly operates the lottery, the
848	department shall promulgate rules specifying the terms and
849	conditions for contracting with retailers who will best serve
850	the public interest and promote the sale of lottery tickets.
851	(2)  If the department directly operates the lottery, in
852	the selection of retailers, the department shall consider
853	factors such as financial responsibility, integrity, reputation,
854	accessibility of the place of business or activity to the
855	public, security of the premises, the sufficiency of existing
856	retailers to serve the public convenience, and the projected
857	volume of the sales for the lottery game involved. In the
858	consideration of these factors, the department may require the
859	information it deems necessary of any person applying for
860	authority to act as a retailer. However, the department may not
861	establish a limitation upon the number of retailers and shall
862	make every effort to allow small business participation as
863	retailers. It is the intent of the Legislature that retailer
864	selections be based on business considerations and the public
865	convenience and that retailers be selected without regard to
866	political affiliation.
867	(3)  If the department directly operates the lottery, the
868	department shall not contract with any person as a retailer who:
869	(a)  Is less than 18 years of age.
870	(b)  Is engaged exclusively in the business of selling
871	lottery tickets; however, this paragraph shall not preclude the
872	department from selling lottery tickets.
873	(c)  Has been convicted of, or entered a plea of guilty or
874	nolo contendere to, a felony committed in the preceding 10
875	years, regardless of adjudication, unless the department
876	determines that:
877	1.  The person has been pardoned or the person's civil
878	rights have been restored;
879	2.  Subsequent to such conviction or entry of plea the
880	person has engaged in the kind of law-abiding commerce and good
881	citizenship that would reflect well upon the integrity of the
882	lottery; or
883	3.  If the person is a firm, association, partnership,
884	trust, corporation, or other entity, the person has terminated
885	its relationship with the individual whose actions directly
886	contributed to the person's conviction or entry of plea.
887	(4)  If the department directly operates the lottery, the
888	department shall issue a certificate of authority to each person
889	with whom it contracts as a retailer for purposes of display
890	pursuant to subsection (6). The issuance of the certificate
891	shall not confer upon the retailer any right apart from that
892	specifically granted in the contract. The authority to act as a
893	retailer shall not be assignable or transferable.
894	(5)  Any contract executed by the department under pursuant
895	to this section shall specify the reasons for any suspension or
896	termination of the contract by the department, including, but
897	not limited to:
898	(a)  Commission of a violation of this chapter act or rule
899	adopted pursuant thereto.
900	(b)  Failure to accurately account for lottery tickets,
901	revenues, or prizes as required by the department.
902	(c)  Commission of any fraud, deceit, or misrepresentation.
903	(d)  Insufficient sale of tickets.
904	(e)  Conduct prejudicial to public confidence in the
905	lottery.
906	(f)  Any material change in any matter considered by the
907	department in executing the contract with the retailer.
908	(6)  Every retailer shall post and keep conspicuously
909	displayed in a location on the premises accessible to the public
910	its certificate of authority and, with respect to each game, a
911	statement supplied by the department or the concessionaire of
912	the estimated odds of winning some prize for the game.
913	(7)  No contract with a retailer shall authorize the sale
914	of lottery tickets at more than one location, and a retailer may
915	sell lottery tickets only at the location stated on the
916	certificate of authority.
917	(8)  If the department directly operates the lottery, with
918	respect to any retailer whose rental payments for premises are
919	contractually computed, in whole or in part, on the basis of a
920	percentage of retail sales, and where such computation of retail
921	sales is not explicitly defined to include sales of tickets in a
922	state-operated lottery, the compensation received by the
923	retailer from the department shall be deemed to be the amount of
924	the retail sale for the purposes of such contractual
925	compensation.
926	(9)  If the department directly operates the lottery:
927	(a)  The department may require every retailer to post an
928	appropriate bond as determined by the department, using an
929	insurance company acceptable to the department, in an amount not
930	to exceed twice the average lottery ticket sales of the retailer
931	for the period within which the retailer is required to remit
932	lottery funds to the department. For the first 90 days of sales
933	of a new retailer, the amount of the bond may not exceed twice
934	the average estimated lottery ticket sales for the period within
935	which the retailer is required to remit lottery funds to the
936	department. This paragraph shall not apply to lottery tickets
937	that which are prepaid by the retailer.
938	(b)  In lieu of such bond, the department may purchase
939	blanket bonds covering all or selected retailers or may allow a
940	retailer to deposit and maintain with the Chief Financial
941	Officer securities that are interest bearing or accruing and
942	that, with the exception of those specified in subparagraphs 1.
943	and 2., are rated in one of the four highest classifications by
944	an established nationally recognized investment rating service.
945	Securities eligible under this paragraph shall be limited to:
946	1.  Certificates of deposit issued by solvent banks or
947	savings associations organized and existing under the laws of
948	this state or under the laws of the United States and having
949	their principal place of business in this state.
950	2.  United States bonds, notes, and bills for which the
951	full faith and credit of the government of the United States is
952	pledged for the payment of principal and interest.
953	3.  General obligation bonds and notes of any political
954	subdivision of the state.
955	4.  Corporate bonds of any corporation that is not an
956	affiliate or subsidiary of the depositor.
957
958	Such securities shall be held in trust and shall have at all
959	times a market value at least equal to an amount required by the
960	department.
961	(10)  Every contract entered into by the department
962	pursuant to this section shall contain a provision for payment
963	of liquidated damages to the department for any breach of
964	contract by the retailer.
965	(11)  If the department directly operates the lottery, the
966	department shall establish procedures by which each retailer
967	shall account for all tickets sold by the retailer and account
968	for all funds received by the retailer from such sales. The
969	contract with each retailer shall include provisions relating to
970	the sale of tickets, payment of moneys to the department,
971	reports, service charges, and interest and penalties, if
972	necessary, as the department shall deem appropriate.
973	(12)  If the department directly operates the lottery, no
974	payment by a retailer to the department for tickets shall be in
975	cash. All such payments shall be in the form of a check, bank
976	draft, electronic fund transfer, or other financial instrument
977	authorized by the secretary.
978	(13)  Each retailer shall provide accessibility for
979	disabled persons on habitable grade levels. This subsection does
980	not apply to a retail location that which has an entrance door
981	threshold more than 12 inches above ground level. As used herein
982	and for purposes of this subsection only, the term
983	"accessibility for disabled persons on habitable grade levels"
984	means that retailers shall provide ramps, platforms, aisles and
985	pathway widths, turnaround areas, and parking spaces to the
986	extent these are required for the retailer's premises by the
987	particular jurisdiction where the retailer is located.
988	Accessibility shall be required to only one point of sale of
989	lottery tickets for each lottery retailer location. The
990	requirements of this subsection shall be deemed to have been met
991	if, in lieu of the foregoing, disabled persons can purchase
992	tickets from the retail location by means of a drive-up window,
993	provided the hours of access at the drive-up window are not less
994	than those provided at any other entrance at that lottery
995	retailer location. Inspections for compliance with this
996	subsection shall be performed by those enforcement authorities
997	responsible for enforcement pursuant to s. 553.80 in accordance
998	with procedures established by those authorities. Those
999	enforcement authorities shall provide to the Department of the
1000	Lottery a certification of noncompliance for any lottery
1001	retailer not meeting such requirements.
1002	(14)  If the department directly operates the lottery, the
1003	secretary may, after filing with the Department of State his or
1004	her manual signature certified by the secretary under oath,
1005	execute or cause to be executed contracts between the department
1006	and retailers by means of engraving, imprinting, stamping, or
1007	other facsimile signature.
1008	Section 12.  Section 24.113, Florida Statutes, is amended
1009	to read:
1010	24.113  Minority participation.--
1011	(1)  It is the intent of the Legislature that the
1012	department or the concessionaire, whichever is operating the
1013	lottery, encourage participation by minority business
1014	enterprises as defined in s. 288.703. Accordingly, 15 percent of
1015	the retailers shall be minority business enterprises as defined
1016	in s. 288.703(2); however, no more than 35 percent of such
1017	retailers shall be owned by the same type of minority person, as
1018	defined in s. 288.703(3). The department or the concessionaire
1019	is encouraged to meet the minority business enterprise
1020	procurement goals set forth in s. 287.09451 in the procurement
1021	of commodities, contractual services, construction, and
1022	architectural and engineering services. This section shall not
1023	preclude or prohibit a minority person from competing for any
1024	other retailing or vending agreement awarded by the department
1025	or the concessionaire.
1026	(2)  The department or the concessionaire, whichever is
1027	operating the lottery, shall is directed to undertake training
1028	programs and other educational activities to enable minority
1029	persons to compete for such contracts on an equal basis.
1030	Section 13.  Section 24.114, Florida Statutes, is amended
1031	to read:
1032	24.114  Bank deposits and control of lottery
1033	transactions.--
1034	(1)  If the department directly operates the lottery, all
1035	moneys received by each retailer from the operation of the state
1036	lottery, including, but not limited to, all ticket sales,
1037	interest, gifts, and donations, less the amount retained as
1038	compensation for the sale of the tickets and the amount paid out
1039	as prizes, shall be remitted to the department or deposited in a
1040	qualified public depository, as defined in s. 280.02, as
1041	directed by the department. The department shall have the
1042	responsibility for all administrative functions related to the
1043	receipt of funds. The department may also require each retailer
1044	to file with the department reports of the retailer's receipts
1045	and transactions in the sale of lottery tickets in such form and
1046	containing such information as the department may require. The
1047	department may require any person, including a qualified public
1048	depository, to perform any function, activity, or service in
1049	connection with the operation of the lottery as it may deem
1050	advisable pursuant to this chapter act and rules of the
1051	department, and such functions, activities, or services shall
1052	constitute lawful functions, activities, and services of such
1053	person.
1054	(2)  If the department directly operates the lottery, the
1055	department may require retailers to establish separate
1056	electronic funds transfer accounts for the purpose of receiving
1057	moneys from ticket sales, making payments to the department, and
1058	receiving payments from the department.
1059	(3)  If the department directly operates the lottery, each
1060	retailer is liable to the department for any and all tickets
1061	accepted or generated by any employee or representative of that
1062	retailer, and the tickets shall be deemed to have been purchased
1063	by the retailer unless returned to the department within the
1064	time and in the manner prescribed by the department. All moneys
1065	received by retailers from the sale of lottery tickets, less the
1066	amount retained as compensation for the sale of tickets and the
1067	amount paid out as prizes by the retailer, shall be held in
1068	trust prior to delivery to the department or electronic transfer
1069	to the Operating Trust Fund.
1070	Section 14.  Section 24.115, Florida Statutes, is amended
1071	to read:
1072	24.115  Payment of prizes.--
1073	(1)  If the department directly operates the lottery, the
1074	department shall promulgate rules to establish a system of
1075	verifying the validity of tickets claimed to win prizes and to
1076	effect payment of such prizes; however, the following shall
1077	apply whether the lottery is operated directly by the department
1078	or through a concessionaire:
1079	(a)  The right of any person to a prize, other than a prize
1080	that is payable in installments over time, is not assignable.
1081	However, any prize, to the extent that it has not been assigned
1082	or encumbered pursuant to s. 24.1153, may be paid to the estate
1083	of a deceased prize winner or to a person designated pursuant to
1084	an appropriate court order. A prize that is payable in
1085	installments over time is assignable, but only pursuant to an
1086	appropriate court order as provided in s. 24.1153.
1087	(b)  No prize shall be paid to any person under the age of
1088	18 years unless the winning ticket was lawfully purchased and
1089	made a gift to the minor. In such case, the department or the
1090	concessionaire, if the concessionaire operates the lottery,
1091	shall direct payment to an adult member of the minor's family or
1092	the legal guardian of the minor as custodian for the minor. The
1093	person named as custodian shall have the same powers and duties
1094	as prescribed for a custodian pursuant to chapter 710, the
1095	Florida Uniform Transfers to Minors Act.
1096	(c)  No prize may be paid arising from claimed tickets that
1097	are stolen, counterfeit, altered, fraudulent, unissued, produced
1098	or issued in error, unreadable, not received or not recorded by
1099	the department or the concessionaire, if the concessionaire
1100	operates the lottery, by applicable deadlines, lacking in
1101	captions that confirm and agree with the lottery play symbols as
1102	appropriate to the lottery game involved, or not in compliance
1103	with such additional specific rules and public or confidential
1104	validation and security tests of the department or the
1105	concessionaire, if the concessionaire operates the lottery,
1106	appropriate to the particular lottery game involved.
1107	(d)  No particular prize in any lottery game may be paid
1108	more than once, and in the event of a binding determination that
1109	more than one claimant is entitled to a particular prize, the
1110	sole remedy of such claimants is the award to each of them of an
1111	equal share in the prize.
1112	(e)  For the convenience of the public, retailers may be
1113	authorized to pay winners amounts less than $600 after
1114	performing validation procedures on their premises appropriate
1115	to the lottery game involved.
1116	(f)  Holders of tickets shall have the right to claim
1117	prizes for 180 days after the drawing or the end of the lottery
1118	game or play in which the prize was won; except that with
1119	respect to any game in which the player may determine instantly
1120	if he or she has won or lost, such right shall exist for 60 days
1121	after the end of the lottery game. If a valid claim is not made
1122	for a prize within the applicable period, the prize shall
1123	constitute an unclaimed prize for purposes of subsection (2).
1124	(g)  No prize shall be paid upon a ticket purchased or sold
1125	in violation of this chapter act or to any person who is
1126	prohibited from purchasing a lottery ticket pursuant to this
1127	chapter act. Any such prize shall constitute an unclaimed prize
1128	for purposes of subsection (2).
1129	(2)(a)  Eighty percent of all unclaimed prize money shall
1130	be deposited in the Educational Enhancement Trust Fund
1131	consistent with the provisions of s. 24.121(2). Subject to
1132	appropriations provided in the General Appropriations Act, these
1133	funds may be used to match private contributions received under
1134	the postsecondary matching grant programs established in ss.
1135	1011.32, 1011.85, 1011.94, and 1013.79.
1136	(b)  The remaining 20 percent of unclaimed prize money
1137	shall be added to the pool from which future prizes are to be
1138	awarded or used for special prize promotions.
1139	(3)  The department or the concessionaire, if the
1140	concessionaire operates the lottery, shall be discharged of all
1141	liability upon payment of a prize.
1142	(4)  It is the responsibility of the appropriate state
1143	agency and of the judicial branch to identify to the department
1144	or the concessionaire, in the form and format prescribed by the
1145	department or the concessionaire, persons owing an outstanding
1146	debt to any state agency or owing child support collected
1147	through a court, including spousal support or alimony for the
1148	spouse or former spouse of the obligor if the child support
1149	obligation is being enforced by the Department of Revenue. Prior
1150	to the payment of a prize of $600 or more to any claimant having
1151	such an outstanding obligation, the department or the
1152	concessionaire shall transmit the amount of the debt to the
1153	agency claiming the debt and shall authorize payment of the
1154	balance to the prize winner after deduction of the debt. If a
1155	prize winner owes multiple debts subject to offset under this
1156	subsection and the prize is insufficient to cover all such
1157	debts, the amount of the prize shall be transmitted first to the
1158	agency claiming that past due child support is owed. If a
1159	balance of lottery prize remains after payment of past due child
1160	support, the remaining lottery prize amount shall be transmitted
1161	to other agencies claiming debts owed to the state, pro rata,
1162	based upon the ratio of the individual debt to the remaining
1163	debt owed to the state.
1164	Section 15.  Section 24.1153, Florida Statutes, is amended
1165	to read:
1166	24.1153  Assignment of prizes payable in installments.--
1167	(1)  The right of any person to receive payments under a
1168	prize that is paid in installments over time by the department
1169	or the concessionaire may be voluntarily assigned, in whole or
1170	in part, if the assignment is made to a person or entity
1171	designated pursuant to an order of a court of competent
1172	jurisdiction located in the judicial district where the
1173	assigning prize winner resides or where the headquarters of the
1174	department is located or where in the state the headquarters of
1175	the concessionaire is located. A court may issue an order
1176	approving a voluntary assignment and directing the department or
1177	the concessionaire to make prize payments in whole or in part to
1178	the designated assignee, if the court finds that all of the
1179	following conditions have been met:
1180	(a)  The assignment is in writing, is executed by the
1181	assignor, and is, by its terms, subject to the laws of this
1182	state.
1183	(b)  The purchase price being paid for the payments being
1184	assigned represents a present value of the payments being
1185	assigned, discounted at an annual rate that does not exceed the
1186	state's usury limit for loans.
1187	(c)  The assignor provides a sworn affidavit attesting that
1188	he or she:
1189	1.  Is of sound mind, is in full command of his or her
1190	faculties, and is not acting under duress;
1191	2.  Has been advised regarding the assignment by his or her
1192	own independent legal counsel, who is unrelated to and is not
1193	being compensated by the assignee or any of the assignee's
1194	affiliates, and has received independent financial or tax advice
1195	concerning the effects of the assignment from a lawyer or other
1196	professional who is unrelated to and is not being compensated by
1197	the assignee or any of the assignee's affiliates;
1198	3.  Understands that he or she will not receive the prize
1199	payments or portions thereof for the years assigned;
1200	4.  Understands and agrees that with regard to the assigned
1201	payments the department or the concessionaire and its officials
1202	and employees will have no further liability or responsibility
1203	to make the assigned payments to him or her;
1204	5.  Has been provided with a one-page written disclosure
1205	statement setting forth, in bold type of not less than 14
1206	points, the payments being assigned, by amounts and payment
1207	dates; the purchase price being paid; the rate of discount to
1208	present value, assuming daily compounding and funding on the
1209	contract date; and the amount, if any, of any origination or
1210	closing fees that will be charged to him or her; and
1211	6.  Was advised in writing, at the time he or she signed
1212	the assignment contract, that he or she had the right to cancel
1213	the contract, without any further obligation, within 3 business
1214	days following the date on which the contract was signed.
1215	(d)  Written notice of the proposed assignment and any
1216	court hearing concerning the proposed assignment is provided to
1217	the department's or the concessionaire's counsel at least 10
1218	days prior to any court hearing. The department or the
1219	concessionaire is not required to appear in or be named as a
1220	party to any such action seeking judicial confirmation of an
1221	assignment under this section, but may intervene as of right in
1222	any such proceeding.
1223	(2)  A certified copy of a court order approving a
1224	voluntary assignment must be provided to the department or the
1225	concessionaire no later than 14 days before the date on which
1226	the payment is to be made.
1227	(3)  In accordance with the provisions of s. 24.115(4), a
1228	voluntary assignment may not include or cover payments or
1229	portions of payments that are subject to offset on account of a
1230	defaulted or delinquent child support obligation or on account
1231	of a debt owed to a state agency. Each court order issued under
1232	subsection (1) shall provide that any delinquent child support
1233	obligations of the assigning prize winner and any debts owed to
1234	a state agency by the assigning prize winner, as of the date of
1235	the court order, shall be offset by the department or the
1236	concessionaire first against remaining payments or portions
1237	thereof due the prize winner and then against payments due the
1238	assignee.
1239	(4)  The department or the concessionaire, and its
1240	respective officials and employees, shall be discharged of all
1241	liability upon payment of an assigned prize under this section.
1242	(5)  The department or the concessionaire may establish a
1243	reasonable fee to defray any administrative expenses associated
1244	with assignments made under this section, including the cost to
1245	the department or the concessionaire of any processing fee that
1246	may be imposed by a private annuity provider. The fee amount
1247	shall reflect the direct and indirect costs associated with
1248	processing such assignments.
1249	(6)  If at any time the Internal Revenue Service or a court
1250	of competent jurisdiction issues a determination letter, revenue
1251	ruling, other public ruling of the Internal Revenue Service, or
1252	published decision to any state lottery or prize winner of any
1253	state lottery declaring that the voluntary assignment of prizes
1254	will affect the federal income tax treatment of prize winners
1255	who do not assign their prizes, the secretary of the department
1256	shall immediately file a copy of that letter, ruling, or
1257	published decision with the Secretary of State and the Office of
1258	the State Courts Administrator. A court may not issue an order
1259	authorizing a voluntary assignment under this section after the
1260	date any such ruling, letter, or published decision is filed.
1261	Section 16.  Section 24.117, Florida Statutes, is amended
1262	to read:
1263	24.117  Unlawful sale of lottery tickets; penalty.--Any
1264	person who knowingly:
1265	(1)  Sells a state lottery ticket when not authorized by
1266	the department or this chapter act to engage in such sale;
1267	(2)  Sells a state lottery ticket to a minor; or
1268	(3)  If the department directly operates the lottery, sells
1269	a state lottery ticket at any price other than that established
1270	by the department;
1271
1272	commits is guilty of a misdemeanor of the first degree,
1273	punishable as provided in s. 775.082 or s. 775.083.
1274	Section 17.  Subsections (4) and (5) of section 24.118,
1275	Florida Statutes, are amended to read:
1276	24.118  Other prohibited acts; penalties.--
1277	(4)  BREACH OF CONFIDENTIALITY.--Any person who, with
1278	intent to defraud or with intent to provide a financial or other
1279	advantage to himself, herself, or another, knowingly and
1280	willfully discloses any information relating to the lottery
1281	designated as confidential and exempt from the provisions of s.
1282	119.07(1) pursuant to this chapter commits act is guilty of a
1283	felony of the first degree, punishable as provided in s.
1284	775.082, s. 775.083, or s. 775.084.
1285	(5)  UNLAWFUL REPRESENTATION.--
1286	(a)  Any person who uses point-of-sale materials issued by
1287	the department or the concessionaire or otherwise holds himself
1288	or herself out as a retailer without being authorized by the
1289	department or the concessionaire to act as a retailer commits is
1290	guilty of a misdemeanor of the first degree, punishable as
1291	provided in s. 775.082 or s. 775.083.
1292	(b)  Any person who without being authorized by the
1293	department or the concessionaire in writing uses the term
1294	"Florida Lottery," "State Lottery," "Florida State Lottery," or
1295	any similar term in the title or name of any charitable or
1296	commercial enterprise, product, or service commits is guilty of
1297	a misdemeanor of the first degree, punishable as provided in s.
1298	775.082 or s. 775.083.
1299	Section 18.  Subsections (1) and (2) of section 24.120,
1300	Florida Statutes, are amended to read:
1301	24.120  Financial matters; Operating Trust Fund;
1302	interagency cooperation.--
1303	(1)  There is hereby created in the State Treasury an
1304	Operating Trust Fund to be administered in accordance with
1305	chapters 215 and 216 by the department. If the department
1306	directly operates the lottery, all money received by the
1307	department which remains after payment of prizes and initial
1308	compensation paid to retailers shall be deposited into the
1309	Operating Trust Fund. All moneys in the trust fund are
1310	appropriated to the department for the purposes specified in
1311	this chapter act.
1312	(2)  Moneys available for the payment of prizes awarded by
1313	the department in its direct operation of the lottery on a
1314	deferred basis shall be invested by the State Board of
1315	Administration in accordance with a trust agreement approved by
1316	the secretary and entered into between the department and the
1317	State Board of Administration in accordance with ss. 215.44-
1318	215.53. The investments authorized by this subsection shall be
1319	done in a manner designed to preserve capital and to ensure the
1320	integrity of the lottery disbursement system by eliminating the
1321	risk of payment of funds when due and to produce equal annual
1322	sums of money over the required term of the investments.
1323	Section 19.  Subsections (1), (2), and (3) of section
1324	24.121, Florida Statutes, are amended to read:
1325	24.121  Allocation of revenues and expenditure of funds for
1326	public education.--
1327	(1)  If the department directly operates the lottery,
1328	variable percentages of the gross revenue from the sale of
1329	online and instant lottery tickets shall be returned to the
1330	public in the form of prizes paid by the department or retailers
1331	as authorized by this chapter act. The variable percentages of
1332	gross revenue from the sale of online and instant lottery
1333	tickets returned to the public in the form of prizes shall be
1334	established by the department in a manner designed to maximize
1335	the amount of funds deposited under subsection (2).
1336	(2)  Each fiscal year, if the department directly operates
1337	the lottery, variable percentages of the gross revenue from the
1338	sale of online and instant lottery tickets as determined by the
1339	department consistent with subsection (1), and other earned
1340	revenue, excluding application processing fees, shall be
1341	deposited in the Educational Enhancement Trust Fund, which is
1342	hereby created in the State Treasury to be administered by the
1343	Department of Education. If the department operates the lottery
1344	through a concession agreement, the proceeds to the department
1345	from the concession agreement shall be deposited in the
1346	Educational Enhancement Trust Fund, with, at minimum, the
1347	greater of $400 million or one-third of the funds deposited into
1348	the trust fund to be allocated the Florida Bright Futures
1349	Scholarship Program. The Department of the Lottery shall
1350	transfer moneys to the Educational Enhancement Trust Fund at
1351	least once each quarter. Funds in the Educational Enhancement
1352	Trust Fund shall be used to the benefit of public education in
1353	accordance with the provisions of this chapter act.
1354	Notwithstanding any other provision of law, lottery revenues
1355	transferred to the Educational Enhancement Trust Fund shall be
1356	reserved as needed and used to meet the requirements of the
1357	documents authorizing the bonds issued by the state pursuant to
1358	s. 1013.68, s. 1013.70, or s. 1013.737 or distributed to school
1359	districts for the Classrooms First Program as provided in s.
1360	1013.68. Such lottery revenues are hereby pledged to the payment
1361	of debt service on bonds issued by the state pursuant to s.
1362	1013.68, s. 1013.70, or s. 1013.737. Debt service payable on
1363	bonds issued by the state pursuant to s. 1013.68, s. 1013.70, or
1364	s. 1013.737 shall be payable from, and is secured by a first
1365	lien on, the first lottery revenues transferred to the
1366	Educational Enhancement Trust Fund in each fiscal year. Amounts
1367	distributable to school districts that request the issuance of
1368	bonds pursuant to s. 1013.68(3) are hereby pledged to such bonds
1369	pursuant to s. 11(d), Art. VII of the State Constitution.
1370	(3)  The funds remaining in the Operating Trust Fund after
1371	transfers to the Educational Enhancement Trust Fund shall be
1372	used for the payment of administrative expenses of the
1373	department. These expenses shall include all costs incurred in
1374	the department's direct operation and administration of the
1375	lottery or the concession agreement and all costs resulting from
1376	any contracts entered into for the purchase or lease of goods or
1377	services required by the lottery, including, but not limited to:
1378	(a)  The compensation paid to retailers;
1379	(b)  The costs of supplies, materials, tickets, independent
1380	audit services, independent studies, data transmission,
1381	advertising, promotion, incentives, public relations,
1382	communications, security, bonding for retailers, printing,
1383	distribution of tickets, and reimbursing other governmental
1384	entities for services provided to the lottery; and
1385	(c)  The costs of any other goods and services necessary
1386	for effectuating the purposes of this chapter act.
1387	Section 20.  Section 24.122, Florida Statutes, is amended
1388	to read:
1389	24.122  Exemption from taxation; state preemption;
1390	inapplicability of other laws.--
1391	(1)  This chapter act shall not be construed to authorize
1392	any lottery except the lottery operated by the department or the
1393	concessionaire under pursuant to this chapter act.
1394	(2)  No state or local tax shall be imposed upon any prize
1395	paid or payable under this chapter act or upon the sale of any
1396	lottery ticket pursuant to this chapter act.
1397	(3)  All matters relating to the operation of the state
1398	lottery are preempted to the state, and no county, municipality,
1399	or other political subdivision of the state shall enact any
1400	ordinance relating to the operation of the lottery authorized by
1401	this chapter act. However, this subsection shall not prohibit a
1402	political subdivision of the state from requiring a retailer to
1403	obtain an occupational license for any business unrelated to the
1404	sale of lottery tickets.
1405	(4)  Any state or local law providing any penalty,
1406	disability, restriction, or prohibition for the possession,
1407	manufacture, transportation, distribution, advertising, or sale
1408	of any lottery ticket, including chapter 849, shall not apply to
1409	the tickets of the state lottery operated pursuant to this
1410	chapter act; nor shall any such law apply to the possession of a
1411	ticket issued by any other government-operated lottery. In
1412	addition, activities of the department under this chapter act
1413	are exempt from the provisions of:
1414	(a)  Chapter 616, relating to public fairs and expositions.
1415	(b)  Chapter 946, relating to correctional work programs.
1416	(c)  Chapter 282, relating to communications and data
1417	processing.
1418	(d)  Section 110.131, relating to other personal services.
1419	Section 21.  Section 24.123, Florida Statutes, is amended
1420	to read:
1421	24.123  Annual audit of financial records and reports.--
1422	(1)  The Legislative Auditing Committee shall contract with
1423	a certified public accountant licensed pursuant to chapter 473
1424	for an annual financial audit of the department. The certified
1425	public accountant shall have no financial interest in any vendor
1426	or concessionaire with whom the department is under contract.
1427	The certified public accountant shall present an audit report no
1428	later than 7 months after the end of the fiscal year and shall
1429	make recommendations to enhance the earning capability of the
1430	state lottery or the concession agreement and to improve the
1431	efficiency of department operations. The certified public
1432	accountant shall also perform a study and evaluation of internal
1433	accounting controls and shall express an opinion on those
1434	controls in effect during the audit period. The cost of the
1435	annual financial audit shall be paid by the department.
1436	(2)  The Auditor General may at any time conduct an audit
1437	of any phase of the operations of the state lottery or the
1438	concession agreement and shall receive a copy of the yearly
1439	independent financial audit and any security report prepared
1440	pursuant to s. 24.108.
1441	(3)  A copy of any audit performed pursuant to this section
1442	shall be submitted to the secretary, the Governor, the President
1443	of the Senate, the Speaker of the House of Representatives, and
1444	members of the Legislative Auditing Committee.
1445	Section 22.  Section 24.124, Florida Statutes, is amended
1446	to read:
1447	24.124  Responsibility for ticket accuracy; department,
1448	retailer, and vendor liability.--
1449	(1)  If the department directly operates the lottery,
1450	purchasers of online games tickets shall be responsible for
1451	verifying the accuracy of their tickets, including the number or
1452	numbers printed on the tickets. In the event of an error, the
1453	ticket may be canceled and a replacement ticket issued pursuant
1454	to rules promulgated by the department of the Lottery.
1455	(2)  If the department directly operates the lottery, other
1456	than the issuance of a replacement ticket, there shall be no
1457	right or cause of action and no liability on the part of the
1458	department, retailer, vendor, or any other person associated
1459	with selling an online games ticket, with respect to errors or
1460	inaccuracies contained in the ticket, including errors in the
1461	number or numbers printed on the ticket.
1462	Section 23.  This act shall take effect January 1, 2009.

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