Florida Senate - 2009 SB 1080
By Senator Smith
29-01679-09 20091080__
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
4 concerning regional offices; amending s. 24.101, F.S.;
5 revising a reference; amending s. 24.102, F.S.;
6 revising provisions relating to legislative intent to
7 provide for operation of the lottery under a
8 management agreement; amending s. 24.103, F.S.;
9 providing and revising definitions; amending s.
10 24.104, F.S.; revising language concerning the purpose
11 of the Department of the Lottery to permit contracting
12 with a manager; amending s. 24.105, F.S.; revising
13 provisions concerning the powers and duties of the
14 department to allow for possible contracting with a
15 manager; providing that specified provisions apply
16 regardless of whether the department contracts with a
17 manager; deleting obsolete language; amending s.
18 24.107, F.S.; revising provisions concerning
19 advertising and promotion of lottery games to conform
20 to the possibility of contracting with a manager;
21 amending ss. 24.108 and 24.111, F.S.; revising
22 provisions relating to security and contracts for
23 goods or services to conform to the possibility of
24 contracting with a manager; creating s. 24.1115, F.S.;
25 providing for a management agreement under which the
26 lottery may be operated; providing intent; providing
27 definitions; limiting the duration of such an
28 agreement; providing limits on the games that may be
29 offered under such an agreement; providing for an
30 initial payment to the department by a manager;
31 providing for royalty payments by a manager; providing
32 for collection of funds in excess of a specified
33 baseline growth percentage to ensure that the manager
34 does not earn excess revenue; providing requirements
35 for the contents of a management agreement; requiring
36 periodic investigations of the performance by a
37 manager; providing for a request for qualifications
38 process to select a manager; providing for the public
39 records status of specified materials under existing
40 exemptions; providing for negotiations between one or
41 more offerors and the department; providing selection
42 procedures; requiring a public hearing; providing for
43 designation of a manager by the Governor; providing
44 for status of debt offering by the manager; providing
45 for a time period for challenges to designation of a
46 manager; providing department powers; prohibiting the
47 department from selling the authorization to manage
48 the lottery; providing that there is no prohibition on
49 additional legislative authorization of other forms of
50 gambling; amending s. 24.112, F.S.; revising
51 provisions concerning retailers of lottery tickets to
52 conform to the possibility of contracting with a
53 manager; amending s. 24.113, F.S.; providing that
54 provisions concerning minority participation also
55 apply if the lottery contracts with a manager;
56 amending ss. 24.114, 24.115, 24.1153, 24.117, 24.118,
57 and 24.120, F.S.; revising provisions relating to bank
58 deposits and control of lottery transactions, payment
59 of prizes, assignment of prizes payable in
60 installments, penalties for unlawful sale of lottery
61 tickets, breach of confidentiality, and unlawful
62 representation, and financial matters to conform to
63 the possibility of contracting with a manager;
64 amending s. 24.121, F.S.; revising provisions relating
65 to allocation of revenues and expenditure of funds for
66 public education to conform to the possibility of
67 contracting with a manager; providing for a minimum
68 allocation of proceeds received under a management
69 agreement to the Florida Bright Futures Scholarship
70 Program; amending ss. 24.122, 24.123, and 24.124,
71 F.S.; revising provisions relating to exemption from
72 taxation, state preemption, inapplicability of other
73 laws, annual audit of financial records and reports,
74 responsibility for ticket accuracy, and liability to
75 conform to the possibility of contracting with a
76 manager; providing an effective date.
77
78 Be It Enacted by the Legislature of the State of Florida:
79
80 Section 1. Subsection (3) of section 20.317, Florida
81 Statutes, is amended to read:
82 20.317 Department of the Lottery.—There is created a
83 Department of the Lottery.
84 (3) The headquarters of the department shall be located in
85 Tallahassee. However, the department may establish such regional
86 offices throughout the state as the secretary deems necessary to
87 perform its duties concerning the efficient operation of the
88 state lottery.
89 Section 2. Section 24.101, Florida Statutes, is amended to
90 read:
91 24.101 Short title.—This chapter act may be cited as the
92 “Florida Public Education Lottery Act.”
93 Section 3. Section 24.102, Florida Statutes, is amended to
94 read:
95 24.102 Purpose and intent.—
96 (1) The purpose of this chapter act is to implement s. 15,
97 Art. X of the State Constitution in a manner that enables the
98 people of the state to benefit from significant additional
99 moneys for education and also enables the people of the state to
100 play the best lottery games available.
101 (2) The intent of the Legislature is:
102 (a) That the net proceeds of lottery games conducted
103 pursuant to this chapter act be used to support improvements in
104 public education and that such proceeds not be used as a
105 substitute for existing resources for public education.
106 (b) That the lottery games be operated by a department of
107 state government that functions as much as possible in the
108 manner of an entrepreneurial business enterprise or with the
109 assistance of an entrepreneurial business enterprise under a
110 management agreement overseen by the department. The Legislature
111 recognizes that the operation of a lottery is a unique activity
112 for state government and that structures and procedures
113 appropriate to the performance of other governmental functions
114 are not necessarily appropriate to the operation of a state
115 lottery.
116 (c) That the lottery games be operated by a self
117 supporting, revenue-producing department or with the assistance
118 of an entrepreneurial business enterprise under a management
119 agreement with government oversight.
120 (d) That the department be accountable to the Legislature
121 and the people of the state through a system of audits and
122 reports and through compliance with financial disclosure, open
123 meetings, and public records laws and that any entity contracted
124 with under a management agreement must also be accountable to
125 the Legislature and the people of the state.
126 Section 4. Section 24.103, Florida Statutes, is amended to
127 read:
128 24.103 Definitions.—As used in this chapter act:
129 (1) “Department” means the Department of the Lottery.
130 (2)(4) “Major procurement” means a procurement for a
131 contract for the printing of tickets for use in any lottery
132 game, consultation services for the startup of the lottery, any
133 goods or services involving the official recording for lottery
134 game play purposes of a player's selections in any lottery game
135 involving player selections, any goods or services involving the
136 receiving of a player's selection directly from a player in any
137 lottery game involving player selections, any goods or services
138 involving the drawing, determination, or generation of winners
139 in any lottery game, the security report services provided for
140 in this chapter act, or any goods and services relating to
141 marketing and promotion that which exceed a value of $25,000.
142 (3) “Management agreement” means that agreement entered
143 into pursuant to which the state may contract with a manager to
144 provide management services to the lottery, although under such
145 an agreement the department shall continue to manage and operate
146 the lottery, and further pursuant to which the manager may
147 receive certain lottery ticket or share sales and related
148 proceeds in consideration of the payment of a fee or fees to the
149 state.
150 (4) “Manager” means an entity that provides management
151 services to the lottery on behalf of the department under a
152 management agreement.
153 (5)(3) “Person” means any individual, firm, association,
154 joint adventure, partnership, estate, trust, syndicate,
155 fiduciary, corporation, or other group or combination and shall
156 include any agency or political subdivision of the state.
157 (6)(5) “Retailer” means a person who sells lottery tickets
158 on behalf of the department or the manager pursuant to a
159 contract.
160 (7)(2) “Secretary” means the secretary of the department.
161 (8)(6) “Vendor” means a person who provides or proposes to
162 provide goods or services to the department, but does not
163 include an employee of the department, a retailer, or a state
164 agency.
165 Section 5. Section 24.104, Florida Statutes, is amended to
166 read:
167 24.104 Department; purpose.—The purpose of the department
168 is to operate the state lottery as authorized by s. 15, Art. X
169 of the State Constitution with or without a manager so as to
170 maximize revenues in a manner consonant with the dignity of the
171 state and the welfare of its citizens.
172 Section 6. Subsections (2), (4), (6), (7), (8), (9), (11),
173 (15), (17), (18), and (19) of section 24.105, Florida Statutes,
174 are amended to read:
175 24.105 Powers and duties of department.—The department
176 shall:
177 (2) Supervise and administer the operation of the lottery
178 with or without a manager in accordance with the provisions of
179 this chapter act and rules adopted pursuant thereto.
180 (4) Submit monthly and annual reports to the Governor, the
181 Chief Financial Officer, the President of the Senate, and the
182 Speaker of the House of Representatives disclosing the total
183 lottery revenues, prize disbursements, and other expenses of the
184 department during the preceding month or, if the lottery has
185 entered into a management agreement, comparable information
186 provided by the manager. The annual report shall additionally
187 describe the organizational structure of the department,
188 including its hierarchical structure, and shall identify the
189 divisions and bureaus created by the secretary and summarize the
190 departmental functions performed by each.
191 (6) Maintain weekly or more frequent records of lottery
192 transactions, including the distribution of tickets to
193 retailers, revenues received, claims for prizes, prizes paid,
194 and other financial transactions of the department. If the
195 department has entered into a management agreement, the
196 agreement shall require the manager to maintain comparable
197 information.
198 (7) Make a continuing study of the lottery to ascertain any
199 defects of this chapter act or rules adopted thereunder which
200 could result in abuses in the administration of the lottery;
201 make a continuing study of the operation and the administration
202 of similar laws in other states and of federal laws that which
203 may affect the lottery; and, if the department has not entered
204 into a management agreement, make a continuing study of the
205 reaction of the public to existing and potential features of the
206 lottery.
207 (8) If the department does not enter into a management
208 agreement, conduct such market research as is necessary or
209 appropriate, which may include an analysis of the demographic
210 characteristics of the players of each lottery game and an
211 analysis of advertising, promotion, public relations,
212 incentives, and other aspects of communications.
213 (9) Adopt rules governing the establishment and operation
214 of the state lottery, including:
215 (a)1. If the department does not enter into a management
216 agreement, the type of lottery games to be conducted.
217 2. Regardless of whether the department has entered into a
218 management agreement, except that:
219 a.1. No name of an elected official shall appear on the
220 ticket or play slip of any lottery game or on any prize or on
221 any instrument used for the payment of prizes, unless such prize
222 is in the form of a state warrant.
223 b.2. No coins or currency shall be dispensed from any
224 electronic computer terminal or device used in any lottery game.
225 c.3. Other than as provided in sub-subparagraph d.
226 subparagraph 4., no terminal or device may be used for any
227 lottery game that which may be operated solely by the player
228 without the assistance of the retailer.
229 d.4. The only player-activated machine that which may be
230 utilized is a machine that which dispenses instant lottery game
231 tickets following the insertion of a coin or currency by a
232 ticket purchaser. To be authorized a machine must: be under the
233 supervision and within the direct line of sight of the lottery
234 retailer to ensure that the machine is monitored and only
235 operated by persons at least 18 years of age and; be capable of
236 being electronically deactivated by the retailer to prohibit use
237 by persons less than 18 years of age through the use of a
238 lockout device that maintains the machine's deactivation for a
239 period of no less than 5 minutes unless the machine uses a
240 method of verifying the age of an operator that the department
241 certifies is equivalent or superior to line-of-sight monitoring
242 and lockout by the retailer. Such a machine must also; and be
243 designed to prevent its use or conversion for use in any manner
244 other than the dispensing of instant lottery tickets. Authorized
245 machines may dispense change to players purchasing tickets but
246 may not be utilized for paying the holders of winning tickets of
247 any kind. At least one clerk must be on duty at the lottery
248 retailer while the machine is in operation. However, at least
249 two clerks must be on duty at any lottery location that which
250 has violated s. 24.1055.
251 (b) If the department does not enter into a management
252 agreement, the sales price of tickets.
253 (c) If the department does not enter into a management
254 agreement, the number and sizes of prizes.
255 (d) If the department does not enter into a management
256 agreement, the method of selecting winning tickets. However,
257 regardless of whether the department has entered into a
258 management agreement, if a lottery game involves a drawing, the
259 drawing shall be public and witnessed by an accountant employed
260 by an independent certified public accounting firm. The
261 equipment used in the drawing shall be inspected before and
262 after the drawing.
263 (e) If the department does not enter into a management
264 agreement, the manner of payment of prizes to holders of winning
265 tickets.
266 (f) If the department does not enter into a management
267 agreement, the frequency of drawings or selections of winning
268 tickets.
269 (g) If the department does not enter into a management
270 agreement, the number and type of locations at which tickets may
271 be purchased.
272 (h) If the department does not enter into a management
273 agreement, the method to be used in selling tickets.
274 (i) If the department does not enter into a management
275 agreement, the manner and amount of compensation of retailers.
276 (j) Such other matters necessary or desirable for the
277 efficient or economical operation of the lottery or for the
278 convenience of the public.
279 (11) In the selection of games and method of selecting
280 winning tickets, be sensitive to the impact of the lottery upon
281 the pari-mutuel industry and, accordingly, the department or the
282 manager, if any, may use for any game the theme of horseracing,
283 dogracing, or jai alai and may allow a lottery game to be based
284 upon a horserace, dograce, or jai alai activity so long as the
285 outcome of such lottery game is determined entirely by chance.
286 (15) Or the manager, if any, shall have the authority to
287 charge fees to persons applying for contracts as vendors or
288 retailers, which fees are reasonably calculated to cover the
289 costs of investigations and other activities related to the
290 processing of the application.
291 (17) Or the manager, if any, shall, in accordance with the
292 provisions of this chapter act, enter into contracts with
293 retailers so as to provide adequate and convenient availability
294 of tickets to the public for each game.
295 (18) Or the manager, if any, shall have the authority to
296 enter into agreements with other states for the operation and
297 promotion of a multistate lottery if such agreements are in the
298 best interest of the state lottery. The authority conferred by
299 this subsection is not effective until 1 year after the first
300 day of lottery ticket sales.
301 (19) Employ division directors and other staff as may be
302 necessary to carry out the provisions of this chapter act;
303 however:
304 (a) No person shall be employed by the department who has
305 been convicted of, or entered a plea of guilty or nolo
306 contendere to, a felony committed in the preceding 10 years,
307 regardless of adjudication, unless the department determines
308 that:
309 1. The person has been pardoned or his or her civil rights
310 have been restored; or
311 2. Subsequent to such conviction or entry of plea the
312 person has engaged in the kind of law-abiding commerce and good
313 citizenship that would reflect well upon the integrity of the
314 lottery.
315 (b) No officer or employee of the department having
316 decisionmaking authority shall participate in any decision
317 involving any vendor or retailer with whom the officer or
318 employee has a financial interest. No such officer or employee
319 may participate in any decision involving any vendor or retailer
320 with whom the officer or employee has discussed employment
321 opportunities without the approval of the secretary or, if such
322 officer is the secretary, without the approval of the Governor.
323 Any officer or employee of the department shall notify the
324 secretary of any such discussion or, if such officer is the
325 secretary, he or she shall notify the Governor. A violation of
326 this paragraph is punishable in accordance with s. 112.317.
327 (c) No officer or employee of the department who leaves the
328 employ of the department shall represent any vendor or retailer
329 or the manager, if any, before the department regarding any
330 specific matter in which the officer or employee was involved
331 while employed by the department, for a period of 1 year
332 following cessation of employment with the department. A
333 violation of this paragraph is punishable in accordance with s.
334 112.317.
335 (d) The department shall establish and maintain a personnel
336 program for its employees, including a personnel classification
337 and pay plan which may provide any or all of the benefits
338 provided in the Senior Management Service or Selected Exempt
339 Service. Each officer or employee of the department shall be a
340 member of the Florida Retirement System. The retirement class of
341 each officer or employee shall be the same as other persons
342 performing comparable functions for other agencies. Employees of
343 the department shall serve at the pleasure of the secretary and
344 shall be subject to suspension, dismissal, reduction in pay,
345 demotion, transfer, or other personnel action at the discretion
346 of the secretary. Such personnel actions are exempt from the
347 provisions of chapter 120. All employees of the department are
348 exempt from the Career Service System provided in chapter 110
349 and, notwithstanding the provisions of s. 110.205(5), are not
350 included in either the Senior Management Service or the Selected
351 Exempt Service. However, all employees of the department are
352 subject to all standards of conduct adopted by rule for career
353 service and senior management employees pursuant to chapter 110.
354 In the event of a conflict between standards of conduct
355 applicable to employees of the Department of the Lottery the
356 more restrictive standard shall apply. Interpretations as to the
357 more restrictive standard may be provided by the Commission on
358 Ethics upon request of an advisory opinion pursuant to s.
359 112.322(3)(a), for purposes of this subsection the opinion shall
360 be considered final action.
361 (e) If the department enters into a management agreement,
362 no employee or contractor of the manager shall receive
363 membership in the Florida Retirement System or any other state
364 retirement or other state employee benefits on the basis of such
365 employment or contract.
366 Section 7. Section 24.107, Florida Statutes, is amended to
367 read:
368 24.107 Advertising and promotion of lottery games.—
369 (1) The Legislature recognizes the need for extensive and
370 effective advertising and promotion of lottery games. It is the
371 intent of the Legislature that such advertising and promotion be
372 consistent with the dignity and integrity of the state. In
373 advertising the value of a prize that will be paid over a period
374 of years, the department or the manager, if any, may refer to
375 the sum of all prize payments over the period.
376 (2) The department or the manager, if any, may act as a
377 retailer and may conduct promotions that which involve the
378 dispensing of lottery tickets free of charge.
379 Section 8. Subsections (2), (5), (6), and (7) of section
380 24.108, Florida Statutes, are amended to read:
381 24.108 Division of Security; duties; security report.—
382 (2) The director and all investigators employed by the
383 division shall meet the requirements for employment and
384 appointment provided by s. 943.13 and shall satisfy the
385 requirements for certification established by the Criminal
386 Justice Standards and Training Commission pursuant to chapter
387 943. The director and such investigators shall be designated law
388 enforcement officers and shall have the power to investigate and
389 arrest for any alleged violation of this chapter act or any rule
390 adopted pursuant thereto, or any law of this state. Such law
391 enforcement officers may enter upon any premises in which
392 lottery tickets are sold, manufactured, printed, or stored
393 within the state for the performance of their lawful duties and
394 may take with them any necessary equipment, and such entry shall
395 not constitute a trespass. In any instance in which there is
396 reason to believe that a violation has occurred, such officers
397 have the authority, without warrant, to search and inspect any
398 premises where the violation is alleged to have occurred or is
399 occurring. Any such officer may, consistent with the United
400 States and Florida Constitutions, seize or take possession of
401 any papers, records, tickets, currency, or other items related
402 to any alleged violation.
403 (5) The Department of Law Enforcement shall provide
404 assistance in obtaining criminal history information relevant to
405 investigations required for honest, secure, and exemplary
406 lottery operations, and such other assistance as may be
407 requested by the secretary and agreed to by the executive
408 director of the Department of Law Enforcement. Any other state
409 agency, including the Department of Business and Professional
410 Regulation and the Department of Revenue, shall, upon request,
411 provide the Department of the Lottery with any information
412 relevant to any investigation conducted pursuant to this chapter
413 act. The Department of the Lottery shall maintain the
414 confidentiality of any confidential information it receives from
415 any other agency. The Department of the Lottery shall reimburse
416 any agency for the actual cost of providing any assistance
417 pursuant to this subsection.
418 (6) If the department does not enter into a management
419 agreement, the division shall monitor ticket validation and
420 lottery drawings.
421 (7)(a) If the department does not enter into a management
422 agreement After the first full year of sales of tickets to the
423 public, or sooner if the secretary deems necessary, the
424 department shall, as it deems appropriate, but at least once
425 every 2 years engage an independent firm experienced in security
426 procedures, including, but not limited to, computer security and
427 systems security, to conduct a comprehensive study and
428 evaluation of all aspects of security in the operation of the
429 department.
430 (b) The portion of the security report containing the
431 overall evaluation of the department in terms of each aspect of
432 security shall be presented to the Governor, the President of
433 the Senate, and the Speaker of the House of Representatives. The
434 portion of the security report containing specific
435 recommendations shall be confidential and shall be presented
436 only to the secretary, the Governor, and the Auditor General;
437 however, upon certification that such information is necessary
438 for the purpose of effecting legislative changes, such
439 information shall be disclosed to the President of the Senate
440 and the Speaker of the House of Representatives, who may
441 disclose such information to members of the Legislature and
442 legislative staff as necessary to effect such purpose. However,
443 any person who receives a copy of such information or other
444 information that which is confidential pursuant to this chapter
445 act or rule of the department shall maintain its
446 confidentiality. The confidential portion of the report is
447 exempt from the provisions of s. 119.07(1) and s. 24(a), Art. I
448 of the State Constitution.
449 (c) Thereafter, similar studies of security shall be
450 conducted as the department deems appropriate but at least once
451 every 2 years.
452 Section 9. Subsection (1) and paragraph (h) of subsection
453 (2) of section 24.111, Florida Statutes, are amended to read:
454 24.111 Vendors; disclosure and contract requirements.—
455 (1) The department may enter into contracts for the
456 purchase, lease, or lease-purchase of such goods or services as
457 are necessary for effectuating the purposes of this chapter act.
458 The department may not contract with any person or entity for
459 the total operation and administration of the state lottery
460 established by this chapter as provided in s. 24.1115 or act but
461 may make procurements that which integrate functions such as
462 lottery game design, supply of goods and services, and
463 advertising. In all procurement decisions, the department shall
464 take into account the particularly sensitive nature of the state
465 lottery and shall consider the competence, quality of product,
466 experience, and timely performance of the vendors in order to
467 promote and ensure security, honesty, fairness, and integrity in
468 the operation and administration of the lottery and the
469 objective of raising net revenues for the benefit of the public
470 purpose described in this chapter act.
471 (2) The department shall investigate the financial
472 responsibility, security, and integrity of each vendor with
473 which it intends to negotiate a contract for major procurement.
474 Such investigation may include an investigation of the financial
475 responsibility, security, and integrity of any or all persons
476 whose names and addresses are required to be disclosed pursuant
477 to paragraph (a). Any person who submits a bid, proposal, or
478 offer as part of a major procurement must, at the time of
479 submitting such bid, proposal, or offer, provide the following:
480 (h) If the department does not enter into a management
481 agreement, it The department shall lease all instant ticket
482 vending machines.
483 The department shall not contract with any vendor who fails to
484 make the disclosures required by this subsection, and any
485 contract with a vendor who has failed to make the required
486 disclosures shall be unenforceable. Any contract with any vendor
487 who does not comply with such requirements for periodically
488 updating such disclosures during the tenure of such contract as
489 may be specified in such contract may be terminated by the
490 department. This subsection shall be construed broadly and
491 liberally to achieve the ends of full disclosure of all
492 information necessary to allow for a full and complete
493 evaluation by the department of the competence, integrity,
494 background, and character of vendors for major procurements.
495 Section 10. Section 24.1115, Florida Statutes, is created
496 to read:
497 24.1115 Management agreement.—
498 (1) In construing this section, it is the intent of the
499 Legislature that the manager be accountable to the Legislature
500 and the people of this state through a system of audits and
501 reports and by complying with the financial disclosure
502 requirements of this section. The powers conferred by this
503 section are in addition and supplemental to the powers conferred
504 by any other law. If any other law or rule is inconsistent with
505 this section, this section is controlling as to any management
506 agreement entered into under this section.
507 (2) As used in this section, the term:
508 (a) “Offeror” means a person or group of persons that
509 responds to a request for qualifications under this section.
510 (b) “Request for qualifications” means all materials and
511 documents prepared by the department to solicit the following
512 from offerors:
513 1. Statements of qualifications.
514 2. Proposals to enter into a management agreement.
515 (c) “Selected offer” means the final offer of an offeror
516 that is the preliminary selection to be the manager for the
517 lottery under subsection (12).
518 (3)(a) This section contains full and complete authority
519 for a management agreement between the department and a manager
520 and any rules adopted thereunder. No law, procedure, proceeding,
521 publication, notice, consent, approval, order, or act by the
522 department or any other officer, department, agency, or
523 instrumentality of the state or any political subdivision is
524 required for the department to enter into a management agreement
525 under this section.
526 (b) This section contains full and complete authority for
527 the department to approve any subcontracts entered into by a
528 manager under the terms of a management agreement.
529 (4) Subject to the other provisions of this section, the
530 department may enter into a management agreement with a manager
531 for a term not to exceed 30 years.
532 (5) The department may not enter into a management
533 agreement that authorizes a manager to operate any of the
534 following games or a game simulating any of the following games:
535 (a) Video lottery games.
536 (b) Pari-mutuel wagering on any form of racing.
537 (c) A game in which winners are selected on the results of
538 a race or sporting event.
539 (d) Any other game commonly considered to be a form of
540 gambling that is not a game or a variation of a game that the
541 department operated before the management agreement is executed
542 or is operating on the date the management agreement is
543 executed.
544 (6)(a) The management agreement must establish a
545 substantial benchmark amount. The management agreement must
546 require the manager to make an initial payment to the department
547 on the effective date of the management agreement in an amount
548 that exceeds the benchmark amount established in the management
549 agreement.
550 (b) The initial payment required under paragraph (a) shall
551 be deposited as provided in s. 24.121.
552 (c) If the manager fails to make any payment under this
553 section by the due date of the payment, the management agreement
554 is terminated.
555 (7)(a) The management agreement must require that all
556 lottery proceeds initially be directly deposited with the state.
557 The state shall provide sums due to the manager under the
558 agreement only after all of the manger's obligations to the
559 state have been satisfied.
560 (b) The manager shall pay a royalty in the amount equal to
561 one quarter of the lottery's annual profits in the last full
562 fiscal year preceding the agreement to the department four times
563 each year beginning on a date that is specified in the
564 management agreement and that occurs during the first year after
565 the execution of the management agreement. The payments received
566 under this subsection shall be deposited as provided in s.
567 24.121.
568 (c) The management agreement must include the following
569 provisions to ensure that the manager does not earn excess
570 revenue under the management agreement:
571 1. The Office of Policy and Budget in the Executive Office
572 of the Governor shall calculate the percentage rate of average
573 annual growth in gross revenue earned by the department during
574 the last 5 full state fiscal years preceding the commencement of
575 the management agreement. For purposes of this subsection, this
576 percentage is referred to as the “baseline growth percentage.“
577 2. Beginning with the second full state fiscal year after
578 the execution of the management agreement, the Office of Policy
579 and Budget in the Executive Office of the Governor shall for
580 each state fiscal year calculate the growth, expressed as a
581 percentage, in gross revenue earned by the manager under the
582 management agreement, as compared to the preceding state fiscal
583 year.
584 3. The department shall establish an excess payments
585 account for purposes of this paragraph. Any earnings from money
586 in the excess payments account accrue to the account. Money in
587 the excess payments account may be used only to make payments to
588 a manager as required by this paragraph and to receive payments
589 from a manager as required by this paragraph.
590 4. If the percentage calculated by the Office of Policy and
591 Budget in the Executive Office of the Governor under
592 subparagraph 2. for a particular state fiscal year exceeds the
593 baseline growth percentage, the manager must make an additional
594 payment to the department. The amount of the additional payment
595 for the state fiscal year is equal to the gross revenue earned
596 by the manager from lottery tickets in the state fiscal year
597 multiplied by one-half the difference between the percentage
598 calculated by the Office of Policy and Budget in the Executive
599 Office of the Governor under subparagraph 2. for the state
600 fiscal year and the baseline growth percentage. The department
601 shall deposit any additional payment made by the manager under
602 this subparagraph into the excess payments account.
603 5. If the baseline growth percentage exceeds the percentage
604 calculated by the Office of Policy and Budget in the Executive
605 Office of the Governor under subparagraph 2. for a particular
606 state fiscal year, the department must make a payment to the
607 manager from the excess payments account. However, the
608 department is required to make a payment to the manager only if
609 the excess payments account has a positive balance. The amount
610 of the payment by the department for the state fiscal year is
611 equal to the lesser of:
612 a. The result of the gross revenue earned by the manager
613 from lottery tickets in the state fiscal year multiplied by one
614 half the difference between the baseline growth percentage and
615 the percentage calculated by the Office of Policy and Budget in
616 the Executive Office of the Governor under subparagraph 2. for
617 the state fiscal year; or
618 b. The balance in the excess payments account.
619 6. The management agreement must specify the time by which
620 a payment required under this paragraph shall be made.
621 7. If at the expiration or termination of the management
622 agreement there is money remaining in the excess payments
623 account, it shall be retained by the department and deposited as
624 provided in s. 24.121.
625 (8) A management agreement must contain the following:
626 (a) The original term of the management agreement.
627 (b) A requirement that the manager locate its principal
628 office within this state.
629 (c) So long as manager complies with all the conditions of
630 the agreement under the oversight of the department, the manager
631 shall perform its duties and obligations with respect to
632 management of the operation of the lottery, including the
633 following:
634 1. The right to use, or ownership of, equipment and other
635 assets used in the operation of the lottery.
636 2. The rights and obligations under contracts with
637 retailers and vendors.
638 3. The implementation of a comprehensive security program
639 by the manager.
640 4. The implementation of a comprehensive system of internal
641 audits.
642 5. The implementation of a program by the manager to curb
643 compulsive gambling by persons playing the lottery.
644 6. A system for determining the following:
645 a. The type of lottery games to be conducted.
646 b. The method of selecting winning tickets.
647 c. The manner of payment of prizes to holders of winning
648 tickets.
649 d. The frequency of drawings of winning tickets.
650 e. The method to be used in selling tickets.
651 f. A system for verifying the validity of tickets claimed
652 to be winning tickets.
653 g. The basis upon which retailer commissions are
654 established by the manager.
655 h. Minimum payouts.
656 7. A requirement that advertising and promotion must be
657 consistent with the dignity and integrity of the state.
658 (d) Guidelines to ensure that advertising and promoting of
659 the lottery by the manager are not misleading and fairly balance
660 the potential benefits and the potential costs and risks of
661 playing lottery games.
662 (e) A code of ethics for the manager's officers and
663 employees.
664 (f) Monitoring of the manager's practices by the department
665 and the taking of action that the department considers
666 appropriate to ensure that the manager is in compliance with the
667 terms of the management agreement, while allowing the manager,
668 unless specifically prohibited by law or the management
669 agreement, to negotiate and sign its own contracts with vendors.
670 (g) A provision requiring the manager to periodically file
671 appropriate financial statements in a form and manner acceptable
672 to the department.
673 (h) Cash reserve requirements.
674 (i) Procedural requirements for obtaining approval by the
675 department when a management agreement or an interest in a
676 management agreement is sold, assigned, transferred, or pledged
677 as collateral to secure financing. A management agreement or an
678 interest in a management agreement may not be sold, assigned,
679 transferred, or pledged as collateral to secure financing
680 without the approval of the department.
681 (j) Grounds for termination of the management agreement by
682 the department or the manager.
683 (k) Procedures for amendment of the agreement.
684 (l) A provision prohibiting the department from entering
685 into another management agreement under this section as long as
686 the original management agreement has not been terminated.
687 (m) The transition of rights and obligations, including any
688 associated equipment or other assets used in the operation of
689 the lottery, from the manager to any successor manager of the
690 lottery, including the department, following the termination of
691 or foreclosure upon the management agreement.
692 (n) Ownership of all copyrights, trademarks, and service
693 marks by the department in the name of the state and that any
694 use of them by the manager shall only be for the purpose of
695 fulfilling its obligations under the management agreement during
696 the term of the agreement.
697 (o) Minority participation as provided in s. 24.113.
698 (9)(a) The manager shall undergo a complete investigation
699 every 3 years by the department to determine whether the manager
700 remains in compliance with this chapter and the management
701 agreement.
702 (b) The manager shall bear the cost of an investigation or
703 reinvestigation of the manager under this subsection.
704 (10)(a) Before the department enters into a management
705 agreement pursuant to this section, the secretary, as provided
706 in subsection (17), may retain an advisor or advisors to the
707 assess fiscal feasibility of such an agreement and help
708 determine whether to proceed. Such an advisor may also be
709 retained by the department to represent the department in the
710 request for qualifications process, if one is commenced. If the
711 secretary decides to pursue the possibility of a management
712 agreement, a request for qualifications must be issued as set
713 forth in this section. A request for qualifications for a
714 management agreement may be issued in one or more phases.
715 (b) A request for qualifications must include the
716 following:
717 1. The factors or criteria that will be used in evaluating
718 an offeror's statement of qualifications and proposal.
719 2. A statement that a proposal must be accompanied by
720 evidence of the offeror's financial responsibility.
721 3. A statement concerning whether discussions may be
722 conducted with the offerors for the purpose of clarification to
723 ensure full understanding of and responsiveness to the
724 solicitation requirements.
725 4. A statement concerning any other information to be
726 considered in evaluating the offeror's qualifications and
727 proposal.
728 (c) Notice of a request for qualifications shall be
729 published twice at least 7 calendar days apart, with the second
730 publication made at least 7 days before any initial submission
731 is due.
732 (d) As provided in a request for qualifications,
733 discussions may be conducted with the offerors for the purpose
734 of clarification to ensure full understanding of and
735 responsiveness to the solicitation requirements.
736 (11) The contents of proposals are competitive sealed
737 replies in response to an invitation to negotiate for purposes
738 of s. 119.071(1)(b) and are exempt from s. 119.07(1) and s.
739 24(a), Art. I of the State Constitution until disclosure of the
740 contents that are not otherwise exempt under s. 119.071 or other
741 law is required under s. 119.071(1)(b).
742 (12)(a) The department may negotiate with one or more
743 offerors the department determines are responsible and
744 reasonably capable of managing the lottery and may seek to
745 obtain a final offer from one or more of those offerors.
746 (b) The department shall consider the statement of
747 qualifications and the proposals to enter into a management
748 agreement that are submitted in response to a request for
749 qualifications in making a determination under this section,
750 including the following as they apply to the offeror and its
751 partners, if any:
752 1. Expertise, qualifications, competence, skills, and plan
753 to perform obligations under the management agreement in
754 accordance with the management agreement.
755 2. Financial strength, including capitalization and
756 available financial resources.
757 3. Experience in operating government-authorized lotteries
758 and gaming and other similar projects and the quality of any
759 past or present performance on similar or equivalent
760 engagements.
761 4. Integrity, background, and reputation.
762 (c) The requirements set forth in paragraph (b) also apply
763 to the approval of any successor manager.
764 (13)(a) After the final offers from offerors have been
765 negotiated under subsection (12), the department shall:
766 1. Make a preliminary selection of an offeror as the
767 manager for the lottery; or
768 2. Terminate the request for qualifications process.
769 (b) If the department makes a preliminary selection of the
770 manager under this subsection, the department shall schedule a
771 public hearing on the preliminary selection and provide public
772 notice of the hearing at least 7 days before the hearing. The
773 notice must include the following:
774 1. The date, time, and place of the hearing.
775 2. The subject matter of the hearing.
776 3. A brief description of the management agreement to be
777 awarded.
778 4. The identity of the offeror that has been preliminarily
779 selected as the manager.
780 5. The address and telephone number of the department.
781 6. A statement indicating that, subject to subsection (11),
782 and except for those parts that are confidential under s.
783 119.071 or other applicable law, the selected offer and an
784 explanation of the basis upon which the preliminary selection
785 was made are available for public inspection and copying at the
786 principal office of the department during regular business hours
787 and, to the extent feasible, on the Internet.
788 (c) Subject to subsection (11), and except for those parts
789 that are confidential under s. 119.071 or other applicable law,
790 the selected offer and a written explanation of the basis upon
791 which the preliminary selection was made shall be made available
792 for inspection and copying in accordance with s. 119.07 and, to
793 the extent feasible, on the Internet at least 7 calendar days
794 before the hearing scheduled under this section.
795 (d) At the hearing, the department shall allow the public
796 to be heard on the preliminary selection.
797 (14)(a) After the hearing required under subsection (13),
798 the department shall determine if a management agreement should
799 be entered into with the offeror that submitted the selected
800 offer. If the department makes a favorable determination, the
801 department shall submit the determination to the Governor.
802 (b) After review of the department's determination, the
803 Governor may accept or reject the department's determination. If
804 the Governor accepts the department's determination, the
805 Governor shall designate the offeror who submitted the selected
806 offer as the manager for the lottery.
807 (c) After the Governor designates the manager, the
808 department may execute a management agreement with the
809 designated manager.
810 (15) The manager may finance its obligations with respect
811 to the lottery and the management agreement in the amounts and
812 upon the terms and conditions determined by the manager.
813 However, any bonds, debt, other securities, or other financing
814 issued for the purposes of this section shall not be considered
815 to constitute a debt of the state or any political subdivision
816 of the state or a pledge of the faith and credit of the state or
817 any political subdivision of the state.
818 (16) An action to contest the validity of a management
819 agreement entered into under this section may not be brought
820 after the 15th day after the publication of the notice of the
821 designation of the manager under the management agreement as
822 provided in subsection (14).
823 (17)(a) The department must use appropriate experts and
824 professionals needed to conduct a competitive bidding proceeding
825 as required under this section and may use the services of
826 outside professionals to the extent necessary to carry out its
827 obligations under this section.
828 (b) The department may exercise any powers provided under
829 this section in participation or cooperation with any other
830 governmental entity and enter into any contracts to facilitate
831 that participation or cooperation without compliance with any
832 other statute.
833 (c) The department may make and enter into all contracts
834 and agreements necessary or incidental to the performance of the
835 department's duties under this section and the execution of the
836 department's powers under this section. These contracts or
837 agreements are not subject to any approval by any other
838 governmental entity and may be for any term of years within the
839 time period of the management agreement under subsection (4) and
840 contain any terms that are considered reasonable by the
841 department.
842 (d) The department may make and enter into all contracts
843 and agreements with a state agency necessary or incidental to
844 the performance of the duties and the execution of the powers
845 granted to the department or the state agency in accordance with
846 this section or the management agreement. These contracts or
847 agreements are not subject to approval by any other governmental
848 entity and may be for any term of years and contain any terms
849 that are considered reasonable by the department or the state
850 agency.
851 (18)(a) The department may not sell the authorization to
852 operate the lottery.
853 (b) Any tangible personal property used exclusively in
854 connection with the lottery that is owned by the department and
855 leased to the manager shall be owned by the department in the
856 name of the state and shall be considered to be public property
857 devoted to an essential public and governmental function.
858 (19) The department may exercise any of its powers under
859 this chapter or any other law as necessary or desirable for the
860 execution of the department's powers under this section.
861 (20) Neither this section nor any management agreement
862 entered into under this section prohibits the Legislature from
863 authorizing forms of gambling that are not in direct competition
864 with the lottery.
865 Section 11. Section 24.112, Florida Statutes, is amended to
866 read:
867 24.112 Retailers of lottery tickets.—
868 (1) If the department does not enter into a management
869 agreement, the department shall promulgate rules specifying the
870 terms and conditions for contracting with retailers who will
871 best serve the public interest and promote the sale of lottery
872 tickets.
873 (2) If the department does not enter into a management
874 agreement, in the selection of retailers, the department shall
875 consider factors such as financial responsibility, integrity,
876 reputation, accessibility of the place of business or activity
877 to the public, security of the premises, the sufficiency of
878 existing retailers to serve the public convenience, and the
879 projected volume of the sales for the lottery game involved. In
880 the consideration of these factors, the department may require
881 the information it deems necessary of any person applying for
882 authority to act as a retailer. However, the department may not
883 establish a limitation upon the number of retailers and shall
884 make every effort to allow small business participation as
885 retailers. It is the intent of the Legislature that retailer
886 selections be based on business considerations and the public
887 convenience and that retailers be selected without regard to
888 political affiliation.
889 (3) If the department does not enter into a management
890 agreement, the department shall not contract with any person as
891 a retailer who:
892 (a) Is less than 18 years of age.
893 (b) Is engaged exclusively in the business of selling
894 lottery tickets; however, this paragraph shall not preclude the
895 department from selling lottery tickets.
896 (c) Has been convicted of, or entered a plea of guilty or
897 nolo contendere to, a felony committed in the preceding 10
898 years, regardless of adjudication, unless the department
899 determines that:
900 1. The person has been pardoned or the person's civil
901 rights have been restored;
902 2. Subsequent to such conviction or entry of plea the
903 person has engaged in the kind of law-abiding commerce and good
904 citizenship that would reflect well upon the integrity of the
905 lottery; or
906 3. If the person is a firm, association, partnership,
907 trust, corporation, or other entity, the person has terminated
908 its relationship with the individual whose actions directly
909 contributed to the person's conviction or entry of plea.
910 (4) If the department does not enter into a management
911 agreement, the department shall issue a certificate of authority
912 to each person with whom it contracts as a retailer for purposes
913 of display pursuant to subsection (6). The issuance of the
914 certificate shall not confer upon the retailer any right apart
915 from that specifically granted in the contract. The authority to
916 act as a retailer shall not be assignable or transferable.
917 (5) Any contract executed by the department under pursuant
918 to this section shall specify the reasons for any suspension or
919 termination of the contract by the department, including, but
920 not limited to:
921 (a) Commission of a violation of this chapter act or rule
922 adopted pursuant thereto.
923 (b) Failure to accurately account for lottery tickets,
924 revenues, or prizes as required by the department.
925 (c) Commission of any fraud, deceit, or misrepresentation.
926 (d) Insufficient sale of tickets.
927 (e) Conduct prejudicial to public confidence in the
928 lottery.
929 (f) Any material change in any matter considered by the
930 department in executing the contract with the retailer.
931 (6) Every retailer shall post and keep conspicuously
932 displayed in a location on the premises accessible to the public
933 its certificate of authority and, with respect to each game, a
934 statement supplied by the department or the manager of the
935 estimated odds of winning some prize for the game.
936 (7) No contract with a retailer shall authorize the sale of
937 lottery tickets at more than one location, and a retailer may
938 sell lottery tickets only at the location stated on the
939 certificate of authority.
940 (8) If the department does not enter into a management
941 agreement, with respect to any retailer whose rental payments
942 for premises are contractually computed, in whole or in part, on
943 the basis of a percentage of retail sales, and where such
944 computation of retail sales is not explicitly defined to include
945 sales of tickets in a state-operated lottery, the compensation
946 received by the retailer from the department shall be deemed to
947 be the amount of the retail sale for the purposes of such
948 contractual compensation.
949 (9) If the department does not enter into a management
950 agreement:
951 (a) The department may require every retailer to post an
952 appropriate bond as determined by the department, using an
953 insurance company acceptable to the department, in an amount not
954 to exceed twice the average lottery ticket sales of the retailer
955 for the period within which the retailer is required to remit
956 lottery funds to the department. For the first 90 days of sales
957 of a new retailer, the amount of the bond may not exceed twice
958 the average estimated lottery ticket sales for the period within
959 which the retailer is required to remit lottery funds to the
960 department. This paragraph shall not apply to lottery tickets
961 that which are prepaid by the retailer.
962 (b) In lieu of such bond, the department may purchase
963 blanket bonds covering all or selected retailers or may allow a
964 retailer to deposit and maintain with the Chief Financial
965 Officer securities that are interest bearing or accruing and
966 that, with the exception of those specified in subparagraphs 1.
967 and 2., are rated in one of the four highest classifications by
968 an established nationally recognized investment rating service.
969 Securities eligible under this paragraph shall be limited to:
970 1. Certificates of deposit issued by solvent banks or
971 savings associations organized and existing under the laws of
972 this state or under the laws of the United States and having
973 their principal place of business in this state.
974 2. United States bonds, notes, and bills for which the full
975 faith and credit of the government of the United States is
976 pledged for the payment of principal and interest.
977 3. General obligation bonds and notes of any political
978 subdivision of the state.
979 4. Corporate bonds of any corporation that is not an
980 affiliate or subsidiary of the depositor.
981 Such securities shall be held in trust and shall have at all
982 times a market value at least equal to an amount required by the
983 department.
984 (10) Every contract entered into by the department pursuant
985 to this section shall contain a provision for payment of
986 liquidated damages to the department for any breach of contract
987 by the retailer.
988 (11) If the department does not enter into a management
989 agreement, the department shall establish procedures by which
990 each retailer shall account for all tickets sold by the retailer
991 and account for all funds received by the retailer from such
992 sales. The contract with each retailer shall include provisions
993 relating to the sale of tickets, payment of moneys to the
994 department, reports, service charges, and interest and
995 penalties, if necessary, as the department shall deem
996 appropriate.
997 (12) If the department does not enter into a management
998 agreement, no payment by a retailer to the department for
999 tickets shall be in cash. All such payments shall be in the form
1000 of a check, bank draft, electronic fund transfer, or other
1001 financial instrument authorized by the secretary.
1002 (13) Each retailer shall provide accessibility for disabled
1003 persons on habitable grade levels. This subsection does not
1004 apply to a retail location that which has an entrance door
1005 threshold more than 12 inches above ground level. As used herein
1006 and for purposes of this subsection only, the term
1007 “accessibility for disabled persons on habitable grade levels”
1008 means that retailers shall provide ramps, platforms, aisles and
1009 pathway widths, turnaround areas, and parking spaces to the
1010 extent these are required for the retailer's premises by the
1011 particular jurisdiction where the retailer is located.
1012 Accessibility shall be required to only one point of sale of
1013 lottery tickets for each lottery retailer location. The
1014 requirements of this subsection shall be deemed to have been met
1015 if, in lieu of the foregoing, disabled persons can purchase
1016 tickets from the retail location by means of a drive-up window,
1017 provided the hours of access at the drive-up window are not less
1018 than those provided at any other entrance at that lottery
1019 retailer location. Inspections for compliance with this
1020 subsection shall be performed by those enforcement authorities
1021 responsible for enforcement pursuant to s. 553.80 in accordance
1022 with procedures established by those authorities. Those
1023 enforcement authorities shall provide to the Department of the
1024 Lottery a certification of noncompliance for any lottery
1025 retailer not meeting such requirements.
1026 (14) If the department does not enter into a management
1027 agreement, the secretary may, after filing with the Department
1028 of State his or her manual signature certified by the secretary
1029 under oath, execute or cause to be executed contracts between
1030 the department and retailers by means of engraving, imprinting,
1031 stamping, or other facsimile signature.
1032 Section 12. Section 24.113, Florida Statutes, is amended to
1033 read:
1034 24.113 Minority participation.—
1035 (1) It is the intent of the Legislature that the department
1036 or the manager, if any, encourage participation by minority
1037 business enterprises as defined in s. 288.703. Accordingly, 15
1038 percent of the retailers shall be minority business enterprises
1039 as defined in s. 288.703(2); however, no more than 35 percent of
1040 such retailers shall be owned by the same type of minority
1041 person, as defined in s. 288.703(3). The department or the
1042 manager, if any, is encouraged to meet the minority business
1043 enterprise procurement goals set forth in s. 287.09451 in the
1044 procurement of commodities, contractual services, construction,
1045 and architectural and engineering services. This section shall
1046 not preclude or prohibit a minority person from competing for
1047 any other retailing or vending agreement awarded by the
1048 department or the manager.
1049 (2) The department or the manager, if any, shall is
1050 directed to undertake training programs and other educational
1051 activities to enable minority persons to compete for such
1052 contracts on an equal basis.
1053 Section 13. Section 24.114, Florida Statutes, is amended to
1054 read:
1055 24.114 Bank deposits and control of lottery transactions.—
1056 (1) If the department does not enter into a management
1057 agreement, all moneys received by each retailer from the
1058 operation of the state lottery, including, but not limited to,
1059 all ticket sales, interest, gifts, and donations, less the
1060 amount retained as compensation for the sale of the tickets and
1061 the amount paid out as prizes, shall be remitted to the
1062 department or deposited in a qualified public depository, as
1063 defined in s. 280.02, as directed by the department. The
1064 department shall have the responsibility for all administrative
1065 functions related to the receipt of funds. The department may
1066 also require each retailer to file with the department reports
1067 of the retailer's receipts and transactions in the sale of
1068 lottery tickets in such form and containing such information as
1069 the department may require. The department may require any
1070 person, including a qualified public depository, to perform any
1071 function, activity, or service in connection with the operation
1072 of the lottery as it may deem advisable pursuant to this chapter
1073 act and rules of the department, and such functions, activities,
1074 or services shall constitute lawful functions, activities, and
1075 services of such person.
1076 (2) If the department does not enter into a management
1077 agreement, the department may require retailers to establish
1078 separate electronic funds transfer accounts for the purpose of
1079 receiving moneys from ticket sales, making payments to the
1080 department, and receiving payments from the department.
1081 (3) If the department does not enter into a management
1082 agreement, each retailer is liable to the department for any and
1083 all tickets accepted or generated by any employee or
1084 representative of that retailer, and the tickets shall be deemed
1085 to have been purchased by the retailer unless returned to the
1086 department within the time and in the manner prescribed by the
1087 department. All moneys received by retailers from the sale of
1088 lottery tickets, less the amount retained as compensation for
1089 the sale of tickets and the amount paid out as prizes by the
1090 retailer, shall be held in trust prior to delivery to the
1091 department or electronic transfer to the Operating Trust Fund.
1092 Section 14. Section 24.115, Florida Statutes, is amended to
1093 read:
1094 24.115 Payment of prizes.—
1095 (1) If the department does not enter into a management
1096 agreement, the department shall promulgate rules to establish a
1097 system of verifying the validity of tickets claimed to win
1098 prizes and to effect payment of such prizes; however, the
1099 following shall apply whether the department does or does not
1100 enter into a management agreement:
1101 (a) The right of any person to a prize, other than a prize
1102 that is payable in installments over time, is not assignable.
1103 However, any prize, to the extent that it has not been assigned
1104 or encumbered pursuant to s. 24.1153, may be paid to the estate
1105 of a deceased prize winner or to a person designated pursuant to
1106 an appropriate court order. A prize that is payable in
1107 installments over time is assignable, but only pursuant to an
1108 appropriate court order as provided in s. 24.1153.
1109 (b) No prize shall be paid to any person under the age of
1110 18 years unless the winning ticket was lawfully purchased and
1111 made a gift to the minor. In such case, the department or the
1112 manager, if a management agreement is in force, shall direct
1113 payment to an adult member of the minor's family or the legal
1114 guardian of the minor as custodian for the minor. The person
1115 named as custodian shall have the same powers and duties as
1116 prescribed for a custodian pursuant to chapter 710, the Florida
1117 Uniform Transfers to Minors Act.
1118 (c) No prize may be paid arising from claimed tickets that
1119 are stolen, counterfeit, altered, fraudulent, unissued, produced
1120 or issued in error, unreadable, not received or not recorded by
1121 the department or the manager, if a management agreement is in
1122 force, by applicable deadlines, lacking in captions that confirm
1123 and agree with the lottery play symbols as appropriate to the
1124 lottery game involved, or not in compliance with such additional
1125 specific rules and public or confidential validation and
1126 security tests of the department or the manager, if a management
1127 agreement is in force, appropriate to the particular lottery
1128 game involved.
1129 (d) No particular prize in any lottery game may be paid
1130 more than once, and in the event of a binding determination that
1131 more than one claimant is entitled to a particular prize, the
1132 sole remedy of such claimants is the award to each of them of an
1133 equal share in the prize.
1134 (e) For the convenience of the public, retailers may be
1135 authorized to pay winners amounts less than $600 after
1136 performing validation procedures on their premises appropriate
1137 to the lottery game involved.
1138 (f) Holders of tickets shall have the right to claim prizes
1139 for 180 days after the drawing or the end of the lottery game or
1140 play in which the prize was won; except that with respect to any
1141 game in which the player may determine instantly if he or she
1142 has won or lost, such right shall exist for 60 days after the
1143 end of the lottery game. If a valid claim is not made for a
1144 prize within the applicable period, the prize shall constitute
1145 an unclaimed prize for purposes of subsection (2).
1146 (g) No prize shall be paid upon a ticket purchased or sold
1147 in violation of this chapter act or to any person who is
1148 prohibited from purchasing a lottery ticket pursuant to this
1149 chapter act. Any such prize shall constitute an unclaimed prize
1150 for purposes of subsection (2).
1151 (2)(a) Eighty percent of all unclaimed prize money shall be
1152 deposited in the Educational Enhancement Trust Fund consistent
1153 with the provisions of s. 24.121(2). Subject to appropriations
1154 provided in the General Appropriations Act, these funds may be
1155 used to match private contributions received under the
1156 postsecondary matching grant programs established in ss.
1157 1011.32, 1011.85, 1011.94, and 1013.79.
1158 (b) The remaining 20 percent of unclaimed prize money shall
1159 be added to the pool from which future prizes are to be awarded
1160 or used for special prize promotions.
1161 (3) The department or the manager, if a management
1162 agreement is in force, shall be discharged of all liability upon
1163 payment of a prize.
1164 (4) It is the responsibility of the appropriate state
1165 agency and of the judicial branch to identify to the department
1166 or the manager, if a management agreement is in force, in the
1167 form and format prescribed by the department or the manager,
1168 persons owing an outstanding debt to any state agency or owing
1169 child support collected through a court, including spousal
1170 support or alimony for the spouse or former spouse of the
1171 obligor if the child support obligation is being enforced by the
1172 Department of Revenue. Prior to the payment of a prize of $600
1173 or more to any claimant having such an outstanding obligation,
1174 the department or the manager shall transmit the amount of the
1175 debt to the agency claiming the debt and shall authorize payment
1176 of the balance to the prize winner after deduction of the debt.
1177 If a prize winner owes multiple debts subject to offset under
1178 this subsection and the prize is insufficient to cover all such
1179 debts, the amount of the prize shall be transmitted first to the
1180 agency claiming that past due child support is owed. If a
1181 balance of lottery prize remains after payment of past due child
1182 support, the remaining lottery prize amount shall be transmitted
1183 to other agencies claiming debts owed to the state, pro rata,
1184 based upon the ratio of the individual debt to the remaining
1185 debt owed to the state.
1186 Section 15. Section 24.1153, Florida Statutes, is amended
1187 to read:
1188 24.1153 Assignment of prizes payable in installments.—
1189 (1) The right of any person to receive payments under a
1190 prize that is paid in installments over time by the department
1191 or the manager, if a management agreement is in force, may be
1192 voluntarily assigned, in whole or in part, if the assignment is
1193 made to a person or entity designated pursuant to an order of a
1194 court of competent jurisdiction located in the judicial district
1195 where the assigning prize winner resides or where the
1196 headquarters of the department is located or where in the state
1197 the headquarters of the manager is located, if a management
1198 agreement is in force. A court may issue an order approving a
1199 voluntary assignment and directing the department or the manager
1200 to make prize payments in whole or in part to the designated
1201 assignee, if the court finds that all of the following
1202 conditions have been met:
1203 (a) The assignment is in writing, is executed by the
1204 assignor, and is, by its terms, subject to the laws of this
1205 state.
1206 (b) The purchase price being paid for the payments being
1207 assigned represents a present value of the payments being
1208 assigned, discounted at an annual rate that does not exceed the
1209 state's usury limit for loans.
1210 (c) The assignor provides a sworn affidavit attesting that
1211 he or she:
1212 1. Is of sound mind, is in full command of his or her
1213 faculties, and is not acting under duress;
1214 2. Has been advised regarding the assignment by his or her
1215 own independent legal counsel, who is unrelated to and is not
1216 being compensated by the assignee or any of the assignee's
1217 affiliates, and has received independent financial or tax advice
1218 concerning the effects of the assignment from a lawyer or other
1219 professional who is unrelated to and is not being compensated by
1220 the assignee or any of the assignee's affiliates;
1221 3. Understands that he or she will not receive the prize
1222 payments or portions thereof for the years assigned;
1223 4. Understands and agrees that with regard to the assigned
1224 payments the department or the manager and its officials and
1225 employees will have no further liability or responsibility to
1226 make the assigned payments to him or her;
1227 5. Has been provided with a one-page written disclosure
1228 statement setting forth, in bold type of not less than 14
1229 points, the payments being assigned, by amounts and payment
1230 dates; the purchase price being paid; the rate of discount to
1231 present value, assuming daily compounding and funding on the
1232 contract date; and the amount, if any, of any origination or
1233 closing fees that will be charged to him or her; and
1234 6. Was advised in writing, at the time he or she signed the
1235 assignment contract, that he or she had the right to cancel the
1236 contract, without any further obligation, within 3 business days
1237 following the date on which the contract was signed.
1238 (d) Written notice of the proposed assignment and any court
1239 hearing concerning the proposed assignment is provided to the
1240 department's or the manager's counsel at least 10 days prior to
1241 any court hearing. The department or the manager is not required
1242 to appear in or be named as a party to any such action seeking
1243 judicial confirmation of an assignment under this section, but
1244 may intervene as of right in any such proceeding.
1245 (2) A certified copy of a court order approving a voluntary
1246 assignment must be provided to the department or the manager no
1247 later than 14 days before the date on which the payment is to be
1248 made.
1249 (3) In accordance with the provisions of s. 24.115(4), a
1250 voluntary assignment may not include or cover payments or
1251 portions of payments that are subject to offset on account of a
1252 defaulted or delinquent child support obligation or on account
1253 of a debt owed to a state agency. Each court order issued under
1254 subsection (1) shall provide that any delinquent child support
1255 obligations of the assigning prize winner and any debts owed to
1256 a state agency by the assigning prize winner, as of the date of
1257 the court order, shall be offset by the department or the
1258 manager first against remaining payments or portions thereof due
1259 the prize winner and then against payments due the assignee.
1260 (4) The department or the manager, and its respective
1261 officials and employees, shall be discharged of all liability
1262 upon payment of an assigned prize under this section.
1263 (5) The department or the manager may establish a
1264 reasonable fee to defray any administrative expenses associated
1265 with assignments made under this section, including the cost to
1266 the department or the manager of any processing fee that may be
1267 imposed by a private annuity provider. The fee amount shall
1268 reflect the direct and indirect costs associated with processing
1269 such assignments.
1270 (6) If at any time the Internal Revenue Service or a court
1271 of competent jurisdiction issues a determination letter, revenue
1272 ruling, other public ruling of the Internal Revenue Service, or
1273 published decision to any state lottery or prize winner of any
1274 state lottery declaring that the voluntary assignment of prizes
1275 will affect the federal income tax treatment of prize winners
1276 who do not assign their prizes, the secretary of the department
1277 shall immediately file a copy of that letter, ruling, or
1278 published decision with the Secretary of State and the Office of
1279 the State Courts Administrator. A court may not issue an order
1280 authorizing a voluntary assignment under this section after the
1281 date any such ruling, letter, or published decision is filed.
1282 Section 16. Section 24.117, Florida Statutes, is amended to
1283 read:
1284 24.117 Unlawful sale of lottery tickets; penalty.—Any
1285 person who knowingly:
1286 (1) Sells a state lottery ticket when not authorized by the
1287 department or this chapter act to engage in such sale;
1288 (2) Sells a state lottery ticket to a minor; or
1289 (3) If the department does not enter into a management
1290 agreement, sells a state lottery ticket at any price other than
1291 that established by the department;
1292 commits is guilty of a misdemeanor of the first degree,
1293 punishable as provided in s. 775.082 or s. 775.083.
1294 Section 17. Subsections (4) and (5) of section 24.118,
1295 Florida Statutes, are amended to read:
1296 24.118 Other prohibited acts; penalties.—
1297 (4) BREACH OF CONFIDENTIALITY.—Any person who, with intent
1298 to defraud or with intent to provide a financial or other
1299 advantage to himself, herself, or another, knowingly and
1300 willfully discloses any information relating to the lottery
1301 designated as confidential and exempt from the provisions of s.
1302 119.07(1) pursuant to this chapter commits act is guilty of a
1303 felony of the first degree, punishable as provided in s.
1304 775.082, s. 775.083, or s. 775.084.
1305 (5) UNLAWFUL REPRESENTATION.—
1306 (a) Any person who uses point-of-sale materials issued by
1307 the department or the manager or otherwise holds himself or
1308 herself out as a retailer without being authorized by the
1309 department or the manager to act as a retailer commits is guilty
1310 of a misdemeanor of the first degree, punishable as provided in
1311 s. 775.082 or s. 775.083.
1312 (b) Any person who without being authorized by the
1313 department or the manager in writing uses the term “Florida
1314 Lottery,” “State Lottery,” “Florida State Lottery,” or any
1315 similar term in the title or name of any charitable or
1316 commercial enterprise, product, or service commits is guilty of
1317 a misdemeanor of the first degree, punishable as provided in s.
1318 775.082 or s. 775.083.
1319 Section 18. Subsections (1) and (2) of section 24.120,
1320 Florida Statutes, are amended to read:
1321 24.120 Financial matters; Operating Trust Fund; interagency
1322 cooperation.—
1323 (1) There is hereby created in the State Treasury an
1324 Operating Trust Fund to be administered in accordance with
1325 chapters 215 and 216 by the department. If the department does
1326 not enter into a management agreement, all money received by the
1327 department which remains after payment of prizes and initial
1328 compensation paid to retailers shall be deposited into the
1329 Operating Trust Fund. All moneys in the trust fund are
1330 appropriated to the department for the purposes specified in
1331 this chapter act.
1332 (2) Moneys available for the payment of prizes awarded by
1333 the department, if the department does not enter into a
1334 management agreement, on a deferred basis shall be invested by
1335 the State Board of Administration in accordance with a trust
1336 agreement approved by the secretary and entered into between the
1337 department and the State Board of Administration in accordance
1338 with ss. 215.44-215.53. The investments authorized by this
1339 subsection shall be done in a manner designed to preserve
1340 capital and to ensure the integrity of the lottery disbursement
1341 system by eliminating the risk of payment of funds when due and
1342 to produce equal annual sums of money over the required term of
1343 the investments.
1344 Section 19. Subsections (1), (2), and (3) of section
1345 24.121, Florida Statutes, are amended to read:
1346 24.121 Allocation of revenues and expenditure of funds for
1347 public education.—
1348 (1) If the department does not enter into a management
1349 agreement, variable percentages of the gross revenue from the
1350 sale of online and instant lottery tickets shall be returned to
1351 the public in the form of prizes paid by the department or
1352 retailers as authorized by this chapter act. The variable
1353 percentages of gross revenue from the sale of online and instant
1354 lottery tickets returned to the public in the form of prizes
1355 shall be established by the department in a manner designed to
1356 maximize the amount of funds deposited under subsection (2).
1357 (2) Each fiscal year, if the department does not enter into
1358 a management agreement, variable percentages of the gross
1359 revenue from the sale of online and instant lottery tickets as
1360 determined by the department consistent with subsection (1), and
1361 other earned revenue, excluding application processing fees,
1362 shall be deposited in the Educational Enhancement Trust Fund,
1363 which is hereby created in the State Treasury to be administered
1364 by the Department of Education. If the department enters into a
1365 management agreement, the proceeds received by the department
1366 from the management agreement under s. 24.1115(7)(b) and (c)
1367 shall be deposited in the Educational Enhancement Trust Fund,
1368 with, at minimum, the greater of $400 million or one-third of
1369 the funds deposited into the trust fund to be allocated the
1370 Florida Bright Futures Scholarship Program. The Department of
1371 the Lottery shall transfer moneys to the Educational Enhancement
1372 Trust Fund at least once each quarter. Funds in the Educational
1373 Enhancement Trust Fund shall be used to the benefit of public
1374 education in accordance with the provisions of this chapter act.
1375 Notwithstanding any other provision of law, lottery revenues
1376 transferred to the Educational Enhancement Trust Fund shall be
1377 reserved as needed and used to meet the requirements of the
1378 documents authorizing the bonds issued by the state pursuant to
1379 s. 1013.68, s. 1013.70, or s. 1013.737 or distributed to school
1380 districts for the Classrooms First Program as provided in s.
1381 1013.68. Such lottery revenues are hereby pledged to the payment
1382 of debt service on bonds issued by the state pursuant to s.
1383 1013.68, s. 1013.70, or s. 1013.737. Debt service payable on
1384 bonds issued by the state pursuant to s. 1013.68, s. 1013.70, or
1385 s. 1013.737 shall be payable from, and is secured by a first
1386 lien on, the first lottery revenues transferred to the
1387 Educational Enhancement Trust Fund in each fiscal year. Amounts
1388 distributable to school districts that request the issuance of
1389 bonds pursuant to s. 1013.68(3) are hereby pledged to such bonds
1390 pursuant to s. 11(d), Art. VII of the State Constitution.
1391 (3) The funds remaining in the Operating Trust Fund after
1392 transfers to the Educational Enhancement Trust Fund shall be
1393 used for the payment of administrative expenses of the
1394 department. These expenses shall include all costs incurred in
1395 the department's direct operation and administration of the
1396 lottery or the management agreement and all costs resulting from
1397 any contracts entered into for the purchase or lease of goods or
1398 services required by the lottery, including, but not limited to:
1399 (a) The compensation paid to retailers;
1400 (b) The costs of supplies, materials, tickets, independent
1401 audit services, independent studies, data transmission,
1402 advertising, promotion, incentives, public relations,
1403 communications, security, bonding for retailers, printing,
1404 distribution of tickets, and reimbursing other governmental
1405 entities for services provided to the lottery; and
1406 (c) The costs of any other goods and services necessary for
1407 effectuating the purposes of this chapter act.
1408 Section 20. Section 24.122, Florida Statutes, is amended to
1409 read:
1410 24.122 Exemption from taxation; state preemption;
1411 inapplicability of other laws.—
1412 (1) This chapter act shall not be construed to authorize
1413 any lottery except the lottery operated by the department or the
1414 manager under pursuant to this chapter act.
1415 (2) No state or local tax shall be imposed upon any prize
1416 paid or payable under this chapter act or upon the sale of any
1417 lottery ticket pursuant to this chapter act.
1418 (3) All matters relating to the operation of the state
1419 lottery are preempted to the state, and no county, municipality,
1420 or other political subdivision of the state shall enact any
1421 ordinance relating to the operation of the lottery authorized by
1422 this chapter act. However, this subsection shall not prohibit a
1423 political subdivision of the state from requiring a retailer to
1424 obtain an occupational license for any business unrelated to the
1425 sale of lottery tickets.
1426 (4) Any state or local law providing any penalty,
1427 disability, restriction, or prohibition for the possession,
1428 manufacture, transportation, distribution, advertising, or sale
1429 of any lottery ticket, including chapter 849, shall not apply to
1430 the tickets of the state lottery operated pursuant to this
1431 chapter act; nor shall any such law apply to the possession of a
1432 ticket issued by any other government-operated lottery. In
1433 addition, activities of the department under this chapter act
1434 are exempt from the provisions of:
1435 (a) Chapter 616, relating to public fairs and expositions.
1436 (b) Chapter 946, relating to correctional work programs.
1437 (c) Chapter 282, relating to communications and data
1438 processing.
1439 (d) Section 110.131, relating to other personal services.
1440 Section 21. Section 24.123, Florida Statutes, is amended to
1441 read:
1442 24.123 Annual audit of financial records and reports.—
1443 (1) The Legislative Auditing Committee shall contract with
1444 a certified public accountant licensed pursuant to chapter 473
1445 for an annual financial audit of the department. The certified
1446 public accountant shall have no financial interest in any vendor
1447 or manager with whom the department is under contract. The
1448 certified public accountant shall present an audit report no
1449 later than 7 months after the end of the fiscal year and shall
1450 make recommendations to enhance the earning capability of the
1451 state lottery or the management agreement and to improve the
1452 efficiency of department operations. The certified public
1453 accountant shall also perform a study and evaluation of internal
1454 accounting controls and shall express an opinion on those
1455 controls in effect during the audit period. The cost of the
1456 annual financial audit shall be paid by the department.
1457 (2) The Auditor General may at any time conduct an audit of
1458 any phase of the operations of the state lottery or the
1459 management agreement and shall receive a copy of the yearly
1460 independent financial audit and any security report prepared
1461 pursuant to s. 24.108.
1462 (3) A copy of any audit performed pursuant to this section
1463 shall be submitted to the secretary, the Governor, the President
1464 of the Senate, the Speaker of the House of Representatives, and
1465 members of the Legislative Auditing Committee.
1466 Section 22. Section 24.124, Florida Statutes, is amended to
1467 read:
1468 24.124 Responsibility for ticket accuracy; department,
1469 retailer, and vendor liability.—
1470 (1) If the department does not enter into a management
1471 agreement, purchasers of online games tickets shall be
1472 responsible for verifying the accuracy of their tickets,
1473 including the number or numbers printed on the tickets. In the
1474 event of an error, the ticket may be canceled and a replacement
1475 ticket issued pursuant to rules promulgated by the department of
1476 the Lottery.
1477 (2) If the department does not enter into a management
1478 agreement, other than the issuance of a replacement ticket,
1479 there shall be no right or cause of action and no liability on
1480 the part of the department, retailer, vendor, or any other
1481 person associated with selling an online games ticket, with
1482 respect to errors or inaccuracies contained in the ticket,
1483 including errors in the number or numbers printed on the ticket.
1484 Section 23. This act shall take effect January 1, 2010.