SPONSOR:   

Rep. Schwartzkopf & Rep. Longhurst ;  Sen. DeLuca

 

Reps. Barbieri, Gilligan, Keeley, Lavelle, M. Marshall, Plant, B. Short, Viola; Sen. Bunting, Henry, Katz, Sokola

 

HOUSE OF REPRESENTATIVES

145th GENERAL ASSEMBLY

 

HOUSE BILL NO. 100

 

 

AN ACT TO AMEND TITLE 29 OF THE DELAWARE CODE RELATING TO THE LOTTERY.

 


BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:

 


Section 1.  Amend Subchapter I, Chapter 48, Title 29 of the Delaware Code by adding thereto two new sections to read:

"§ 4825.  Sports lottery.

(a)  The Director shall, pursuant to the authority granted under §§4805(a)(1) and 4805(b)(4) of this chapter, commence a sports lottery as soon as practicable.  The Director shall, by rules and regulations, provide for the features and attributes of a sports lottery.  The regulations must, in the Director's judgment, administer the sports lottery in a manner which will produce the greatest income for the State while minimizing or eliminating the risk of financial loss to the State.

(b)  A person under the age of 21 may not purchase a sports lottery ticket, or wager on a sports lottery machine, or in any way participate in the sports lottery. 

 (c)  A sports lottery commenced pursuant to this section must be conducted exclusively at facilities operated by sports lottery agents licensed by the State.  Licenses awarded to video lottery agents relative to the video lottery shall allow those agents to act as sports lottery agents.  In addition to the video lottery agents, the Commission may award sports lottery agent licenses pursuant to the authority granted under § 4826.

§ 4826.  Video and Sports Lottery Licensing Commission.

(a)  There is created the Video and Sports Lottery Licensing Commission, which shall be composed of nine citizens of the State, two of whom shall be appointed by the President Pro Tempore of the Senate, two of whom shall be appointed by the Speaker of the House of Representatives, one of whom shall be appointed by the Minority Leader of the Senate, one of whom shall be appointed by the Minority Leader of the House of Representatives, and one of whom shall be appointed by the Governor.  The Secretary of Finance and Director of the Delaware Economic Development Office shall serve as ex officio members of the Commission.  The Governor shall appoint a Chairperson of the Commission from among its members.  The term of office of each member of the Commission, except for those members who serve on an ex officio basis, shall be two years, except that each member shall serve until his successor shall be appointed.  Members of the Commission may be re-appointed.  A majority of the members of the Commission shall constitute a quorum for the transaction of any business, for the performance of any duty and for the exercise of any power of the Commission. 

(b)  No person shall be appointed to the Commission who is or seeks to be licensed or regulated, directly or indirectly, by the Commission.  No person shall be appointed to the Commission who has any legal or beneficial interest, direct or indirect, pecuniary or otherwise, in any person, business, organization or entity who is or seeks to be licensed or regulated.  No person shall be appointed to the Commission who has been convicted of any felony or any crime involving gambling or a crime of moral turpitude within the preceding 10 years.

(c)  Members of the Commission shall serve without compensation, except that they may be reimbursed by the Department of Finance for reasonable and necessary expenses incident to their duties as members of the Commission.  Members of the Commission and their agents or employees shall not be subject to, and shall be immune from, claims, suits, liability, damages or any other civil recourse arising from any act, proceeding, decision or determination undertaken or performed as a member of the Commission, provided that such person acted in good faith and without malice in carrying out their responsibilities, authority, duties, powers and privileges.  

(d)  The Chairperson of the Commission shall call an initial meeting of the Commission within thirty days of receipt of any application for a license to operate as a video lottery agent or sports lottery agent, except that the Commission may choose to extend the time period during which to conduct such an initial meeting.  In any matter or proceeding before the Commission, the Commission may decide the manner and method of giving notice to those persons affected by, likely to be affected by or likely to be interested in the matter or proceeding.  Meetings shall be subject to the Freedom of Information Act, §§ 10001-10005 of this title.

(e)  The Commission shall have the power and it shall be the Commission’s duty to act upon any application for a license to operate as a video lottery agent or sports lottery agent.  Any license granted pursuant to this section is a privilege personal to the agent and not a legal right.  A license granted or renewed pursuant to this section may not be transferred or assigned to another person, nor may a license be pledged as collateral.

(1)  The Commission may license a qualified person, business, organization or entity which owns or operates a property on which it is, or will be prior to operation, licensed to sell spirits, wine or beer as a restaurant, tavern or taproom pursuant to Title 4, and which satisfies such fitness and background standards as the Director may promulgate pursuant to §4805(a)(16) of this title, to operate a sports lottery on that property as a sports lottery agent.  No more than ten persons, businesses, organizations or entities shall be licensed as sports lottery agents pursuant to this subsection at any time, and the determination of how many licenses to offer within that limitation shall be subject to the discretion of the Commission. 

(2)  The Commission may license a qualified person, business, organization or entity which satisfies such fitness and background standards as the Director may promulgate pursuant to §4805(a)(16) of this title to operate a video lottery as a video lottery agent.  Video lottery agents operating on December 31, 2008 shall remain licensed, subject to the remainder of this chapter, and need not file an application with the Commission.  In addition to those video lottery agents operating on December 31, 2008, there shall be no more than three persons, businesses, organizations or entities licensed as video lottery agents pursuant to this subsection at any time, and the determination of how many licenses to offer within those limitations shall be subject to the discretion of the Commission. 

(3)  In considering license applications pursuant to this section, the Commission shall consider whether and to what extent the applicant’s proposal would foster economic growth in Delaware, would promote increased employment in Delaware, would result in a net revenue gain to the State, would effect the surrounding community, would effect the area businesses, reflects a sound business plan, has or is likely to have any necessary financing, and is not subject to contingencies.  The Commission shall also consider whether to impose an appropriate license fee to be paid into the State’s General Fund and the amount of that license fee, if any.

(4)  Change of ownership of the licensed business, organization or entity occurring after the Commission has issued a license shall automatically terminate the license 90 days thereafter unless the Commission has determined after application to issue a license to the new owner(s) because the new owner(s) have met the requirements of §4806(a)(1)-(4) and (b) of this title and satisfied such fitness and background standards as the Director may promulgate pursuant to §4805(a)(16) of this title.  For purposes of this subsection, a "change of ownership" shall have occurred if more than 20 percent of the legal or beneficial interests in such person, corporation or association shall be transferred, whether by direct or indirect means.".

Section 2.   Amend §4801, Title 29 of the Delaware Code by deleting subsection (b)(2) in its entirety and by substituting in lieu thereof new subsections (b)(2) and (b)(3) to read:

"(2)  Promote economic growth by expanding State lottery facilities in a manner that generates the greatest possible income for the State and fosters job creation and economic development; and

(3)  Restrict access to the video lottery and sports lottery to persons at least 21 years of age and promote responsible gaming through the treatment, education and assistance of compulsive gamblers and their families.". 

Section 3.  Amend §4803, Title 29 of the Delaware Code by deleting subsection (k) in its entirety and by substituting in lieu thereof new subsections (k) – (o) to read:

"(k)  'Credit Slip' shall mean the receipt generated by a video lottery terminal or sports lottery machine when a player is finished playing that particular video lottery terminal or sports lottery machine.

(l)  'Sports lottery' shall mean a lottery in which the winners are determined based on the outcome of any professional or collegiate sporting event, including racing, held within or without the State, but excluding collegiate sporting events that involve a Delaware college or university and amateur sporting events that involve a Delaware team.

(m)  'Sports lottery machine' shall mean any machine in which bills, coins or tokens are deposited in order to play a sports lottery game.  A machine shall be considered a sports lottery machine notwithstanding the use of an electronic credit system making the deposit of bills, coins or tokens unnecessary.

(n)  'Sports lottery operations employee' shall mean an individual employee, person or agent of an applicant or licensee who is responsible for the security of sports lottery operations or proceeds.

(o)  ‘Commission’ shall mean the Video and Sports Lottery Licensing Commission.".

Section 4.  Amend §4805(a), Title 29 of the Delaware Code by deleting "video lottery machines" and by substituting in lieu thereof "the video lottery and sports lottery".

Section 5.  Amend §4805(a), Title 29 of the Delaware Code by deleting subsections (12)-(14) in their entirety and by substituting in lieu thereof new subsections to read:

"(12)  Such other matters necessary or desirable for the efficient and economical operation and administration of the game and for the convenience of the purchasers of tickets and the holders of winning tickets and the players of the video lottery and sports lottery;

(13)  Value of bills, coins or tokens needed to play video lottery machines and sports lottery machines;

(14)  At the direction of the Commission, licensing of agents for video lotteries and sports lotteries;".

Section 6.  Amend §4805(a), Title 29 of the Delaware Code by deleting subsections (16)-(22) in their entirety and by substituting in lieu thereof new subsections to read:

"(16)  A licensure requirement and enforcement procedure (taking no more than 90 days to complete, unless extenuating circumstances require a longer period in which case the Director and the State shall act with all deliberate speed to complete the process) for officers, directors, key employees, video lottery operations employees, sports lottery operations employees, and persons who own directly or indirectly 10% or more of such agent, which licensure requirement shall include the satisfaction of such security, fitness and background standards as the Director may deem necessary relating to competence, honesty and integrity, such that a person's reputation, habits and associations do not pose a threat to the public interest of the State or to the reputation of or effective regulation and control of the lottery; it being specifically understood that any person convicted of any felony, a crime involving gambling or a crime of moral turpitude within 10 years prior to applying for a license hereunder or at any time thereafter shall be deemed unfit.  The Delaware State Police shall conduct the security, fitness and background checks required under this rule or regulation.  It shall be the obligation of the video lottery agent and sports lottery agent to notify the Director on a continuing basis of any change in officers, partners, directors, key employees, video lottery operations employees, sports lottery operations employees and persons who own, directly or indirectly, 10% or more of such entity;

(17) A licensure requirement and enforcement procedure (taking no more than 90 days to complete, unless extenuating circumstances require a longer period in which case the Director and the State shall act with all deliberate speed to complete the process) for those persons or entities, including lottery machine manufacturers, who propose to contract with a video lottery agent, sports lottery agent, or the State for the provision of goods or services including management services, which licensure requirements shall include the satisfaction of such security, fitness and background standards for officers, directors, key employees, video lottery operations employees, sports lottery operations employees, and persons who own directly or indirectly 10% or more of such entity, as the Director may deem necessary relating to competence, honesty and integrity, such that a person's reputation, habits and associations do not pose a threat to the public interest of the State or to the reputation of or effective regulations and control of the lottery; it being specifically understood that any person convicted of any felony, a crime involving gambling or a crime of moral turpitude within 10 years prior to applying for a license hereunder or at any time thereafter shall be deemed unfit.  The Director may determine whether the licensing standards of another state are comprehensive, thorough and provide similar adequate safeguards and, if so, may, in the Director's discretion, license an applicant already licensed in such state without the necessity of a full application and background check.  The Delaware State Police shall conduct the security, fitness and background checks required under this rule or regulation.  It shall be the obligation of any licensed entity, including technology providers, to notify the Director on a continuing basis of any change in officers, partners, directors, key employees, video lottery operations employees, sports lottery operations employees, and persons who own, directly or indirectly, 10% or more of such entity;

(18)  Standards for advertising, marketing and promotional materials used by video lottery agents and sports lottery agents;

(19)  Regulations and procedures for the accounting and reporting of the payments required under § 4815 of this title;

(20)  The registration, kind, type, number and location of video lottery machines and sports lottery machines on the licensee's premises, subject to the Director's obligations set forth in § 4820(b) of this title;

(21)  The on-site security arrangements for video lottery agents and sports lottery agents;

(22)  Requiring the reporting of information about a video lottery agent or sports lottery agent, its employees, vendors and finances necessary or desirable to ensure the security of the lottery system.  None of the information disclosed pursuant to this subsection shall be subject to disclosure under the Freedom of Information Act, §§ 10001-10005 of this title;".

Section 7.  Amend §4805(a)(24), Title 29 of the Delaware Code by adding the words "or sports lottery agent" after each occurrence of "video lottery agent" and by deleting the word "video" when it appears in subsection (a)(24)c2.

Section 8.  Amend §4805(a), Title 29 of the Delaware Code by deleting subsection (25) in its entirety and by substituting in lieu thereof a new subsection (25) to read:

"(25)  The Director shall adopt procedures under the Delaware Administrative Procedures Act for employment investigations of the honesty, integrity, reputation and associations of office employees in order to determine that the employee's employment does not pose a threat to the public interest of the State or the integrity of the office.  The procedures and any rules and regulations shall require any person seeking employment for compensation with the office for a position which has direct access to lottery ticket sales agents, video lottery agents, sports lottery agents or vendors to submit his or her fingerprints and other relevant information in order to obtain the individual's entire federal and state criminal history record.  The Delaware State Police shall conduct the investigations required under such rules and regulations.  The rules and regulations shall require new employees to submit fingerprints for purposes of the state and federal criminal history checks; and".

Section 9.  Amend §4805(a), Title 29 of the Delaware Code by adding thereto a new subsection to read:

"(26)  Type and number of sports lottery games to be conducted, the price or prices for any sports lottery games, the rules for any sports lottery games, and the payout and manner of compensation to be paid to winners of sports lottery games.".

Section 10.  Amend §4805(b), Title 29 of the Delaware Code by deleting subsection (2) in its entirety and by substituting in lieu thereof a new subsection (2) to read:

"(2)  Within the limit of the funds made available in § 3 of 59 Del. Laws, c. 348, and proceeding from the sale of lottery tickets and generated by the operations of video lottery agents and sports lottery agents, appoint such professional, technical, and clerical assistants and employees as may be necessary to perform the duties imposed upon the office by this subchapter.".  

Section 11.  Amend §4805(b), Title 29 of the Delaware Code by deleting subsection (13) in its entirety and by re-numbering sub-sections (14) and (15) as (13) and (14).

Section 12.  Amend §4805, Title 29 of the Delaware Code by deleting subsection (c) in its entirety and by substituting in lieu thereof a new subsection (c) to read:

"(c) Any license granted pursuant to chapter may be revoked or suspended for cause upon 30 days' written notice to the licensee or due to a change in ownership as set forth in §4826(e)(4), but shall otherwise not be subject to expiration or termination.  "Cause" shall by way of example and not by limitation include falsifying any application for license or report required by the rules and regulations, the failure to report any information required by the rules and regulations, the material violation of any rules and regulations promulgated by the Director, the failure to remit any license fees or other amounts due to the State, or any conduct by the licensee which undermines the public confidence in the lottery system or serves the interest of organized gambling or crime and criminals in any manner.  A license may be revoked for an unintentional violation of any federal, state or local law, rule or regulation provided that the violation is not cured within a reasonable time as determined by the Director; or a longer period where the video lottery agent or sports lottery agent has made diligent efforts to cure.  A license to operate as a sports lottery agent may be revoked upon the cancellation or suspension of the license to sell spirits, wine or beer on the property pursuant to Title 4.  The Secretary of Finance shall within a reasonable time, if requested, appoint a hearing officer to hold a hearing to determine whether the license should be revoked or suspended.  The hearing officer's decision revoking or suspending the license shall be appealable to the Superior Court under the provisions of the Administrative Procedures Act.  Any decision of the Director relating to the business plan of a licensee or the number of video lottery machines to be awarded to video lottery agents under § 4820(b) of this title shall be appealable under the Administrative Procedures Act in the manner of a case decision.  Notwithstanding the foregoing, nothing in this subsection shall otherwise prohibit the termination or revocation of a license in accordance with the rules and regulations adopted hereunder.".

Section 13.  Amend §4807, Title 29 of the Delaware Code by adding the words "or a sports lottery agent" after "video lottery agent" and before "as the case may be.".

Section 14.  Amend §4815, Title 29 of the Delaware Code by deleting subsection (b)(2) in its entirety and by substituting in lieu thereof a new subsection (b)(2) to read:

"(2) Proceeds returned to the State. -- Of amounts remaining after all payments to players under paragraph (1) of this subsection, there shall be returned to the State thirty-eight percent of average daily win and the funds on each credit slip that has not been presented for redemption within 1 year from the date the slip is issued.

The funds retained by the State Lottery shall be applied as follows: first, to the administrative costs and expenses in respect of the video lottery including, but not limited to, administrative expenses including payroll and other employment costs attributable to the operation of the video lottery by the State Lottery Office, law-enforcement and security expenses, including payroll and other employment costs of the State Lottery, the office of the Attorney General and the Delaware State Police, attributable to the operation by the State Lottery of a video lottery; second, $1,000,000 or 1%, whichever is greater, of the proceeds distributed under (b)(2)a.--d. of this section, to the Division of Substance Abuse and Mental Health of the Department of Health and Social Services for funding programs for the treatment, education and assistance of compulsive gamblers and their families; third, costs of the Administrator of Racing and racing inspectors referenced in Chapters 100 and 101 of Title 3; and fourth, the remainder shall be paid into the State's General Fund.". 

Section 15.  Amend §4815(b)(3), Title 29 of the Delaware Code by deleting subsection a. in its entirety and by substituting in lieu thereof a new subsection a. to read:

"a.  Additional state proceeds -- The State shall receive an additional 12.27% of the proceeds remaining after payments made under paragraph (1) of this subsection from the proceeds attributable to licensees which conducted 40 or fewer (but at least 1) days of live harness horse races during 1992, 12.59% of such proceeds of licensees which conducted more than 40 days of live harness racing during 1992 or which conduct thoroughbred racing under Title 28, 12.73% of such proceeds of licensees which conduct thoroughbred horse racing pursuant to Chapter 101 of Title 3, and 12.59% of such proceeds of video lottery agents licensed pursuant to §4819(a)(2).  From these proceeds, the State shall pay for all costs of equipment (both video lottery machines and related equipment), whether leased or owned by the State, used or under the control of such agent and the cost of the central computer used to monitor the equipment used by the agent, provided that the video lottery agents shall reimburse the State for additional equipment costs for the operation of video lottery machines that require the payment of an additional license or proprietary fee as provided under paragraph (b)(3)d. of this section.  The State shall also pay $750,000 of the proceeds received under this section from licensees under this chapter which conduct live harness horse racing to fund the State's contribution to the Delaware Standardbred Breeder's Program. Said amount is to be allocated equally as of January 1st of the calendar year among existing licensees which conduct live harness horse racing, but moneys shall not be expended for the program until such time as a plan has been approved pursuant to paragraph (b)(3)b.2.D. of this section.  Effective July 1, 2008, the State shall also pay $250,000 of the proceeds received under this section from a licensee under this chapter which conducts live thoroughbred horse racing to fund the State's contribution to the Delaware Certified Thoroughbred Program (DCTP).  Said amount shall be allocated as of January 1 of each calendar year to the existing licensee which conducts live thoroughbred horse racing, but moneys shall not be expended for the program until such time as a plan has been approved pursuant to paragraph (b)(3)b.1. of this section.  Moneys remaining after payment of all costs of equipment and central computer monitoring shall be deposited to the General Fund of the State.". 

Section 16.  Amend §4815(b)(3)b1, Title 29 of the Delaware Code by striking the words "10% of the proceeds remaining after payments made under paragraph (b)(1) of this section." and substituting in lieu thereof the words "9% of the proceeds remaining after payments made under paragraph (b)(1) of this section.".

Section 17.  Amend §4815(b)(3)b2A, Title 29 of the Delaware Code by striking the words "10% of the proceeds" and substituting in lieu thereof the words "9% of the proceeds".

Section 18.  Amend §4815(b)(3)b2B, Title 29 of the Delaware Code by striking the words "10% of the first $ 25,000 in proceeds" and substituting in lieu thereof the words "9% the first $ 25,000 in proceeds".

Section 19.  Amend §4815(b)(3)b2B, Title 29 of the Delaware Code by striking the words "20% of such remaining proceeds" and substituting in lieu thereof the words "19% of such remaining proceeds".

Section 20.  Amend §4815(b)(3)b2C, Title 29 of the Delaware Code by striking the words "20% of the proceeds" and substituting in lieu thereof the words "19% of the proceeds".

Section 21.  Amend §4815(b)(3)b, Title 29 of the Delaware Code by adding thereto a new subsection to read:

"5.  For video lottery agents licensed pursuant to §4819(a)(2), the preceding sub-paragraphs 1. - 4. shall not apply and such agents shall return to the State an amount calculated as follows:  9% of the proceeds remaining after payments made under paragraph (b)(1) of this section.".

Section 22.  Amend §4815, Title 29 of the Delaware Code by adding thereto a new subsection to read:

"(c)  All proceeds, net of proceeds returned to players and the State's operating expenses and vendor fees, from the operation of the sports lottery shall be electronically transferred daily or weekly at the discretion of the Lottery Director into a designated State Lottery account by the agent, and transferred to the State Lottery Fund by the Lottery on a daily or weekly basis.  Proceeds from the sports lottery, less the amounts returned to winning players and the State's operating expenses and vendor fees, shall be returned to the State at a rate of 50% of the total win so experienced.  The Director, by regulation shall adopt accounting procedures for the sports lottery in order to accommodate the differences between the sports lottery and the video lottery.  Administrative costs and expenses incurred for the initiation of the sports lottery and the costs of the equipment shall be solely the responsibility of the agent granted the license to operate as a sports lottery agent by Commission.  The provisions of § 4815(b) shall not apply to the proceeds from any licensed sports lottery operation.".

Section 23.  Amend §4819, Title 29 of the Delaware Code by deleting subsection (a) in its entirety and by substituting in lieu thereof a new subsection (a) to read:

"(a)  Video lottery machines shall only be located:

(1)  Within the confines of an existing racetrack property in this State on which was conducted in 1993 either a horse racing meet pursuant to Title 3 or Title 28 or a harness horse racing meet pursuant to Title 3 and/or such immediately adjacent property or properties that are owned by, or immediately adjacent properties that may be acquired by, the video lottery licensee authorized to conduct such horse racing or harness racing; and provided further, that video lottery machines shall not be located in a hotel, motel or other overnight sleeping facility; and

(2)  At any other property in the State, other than those authorized in subsection (1), for which a license to operate as a video lottery agent has been granted pursuant to this chapter by the Commission.".

Section 24.  Amend §4820, Title 29 of the Delaware Code by deleting subsection (a) in its entirety and by substituting in lieu thereof a new subsection (a) to read:

"(a)  All video lottery machines and sports lottery machines shall be owned or leased by the State and shall be obtained from manufacturers licensed under §4805(a)(17) of this title.  All video lottery machines and sports lottery machines shall be leased or purchased under the procedures set forth in Chapter 69 of this title.  Any video lottery agent or sports lottery agent must file with the Director a copy of any current or proposed agreement or disclose any other relationship between the agent, its parents, subsidiaries, related entities, directors, officers or key employees for the sale, lease, maintenance, repair or other assignment to the agent's facility of video lottery machines or sports lottery machines, or any other relationship with any vendor, manufacturer or other party which stands to benefit financially from the possession or use of video lottery machines or sports lottery machines by such agent.  Failure to file such information shall constitute grounds for the revocation or suspension of a license.  The lottery may own or lease video lottery machines pursuant to this subsection that require the payment of an additional license or proprietary fees and the number of such license or proprietary fee machines at any licensed video lottery agent may not exceed more than 5% of the total number of video lottery machines at the licensed racetrack property unless the Director finds that an additional number of such machines are necessary to increase revenues, will not produce reductions in the overall net proceeds from the video lottery, will protect the public welfare, and will ensure the security of the video lottery.".

Section 25.  Amend §4820(b), Title 29 of the Delaware Code by deleting the words "racetrack property" and "racetrack" wherever they appear and by substituting in lieu thereof the words "licensed property".        

Section 26.  Amend §4820, Title 29 of the Delaware Code by deleting subsections (c)-(f) in their entirety and by substituting in lieu thereof new subsections (c)-(g) to read:

“(c)  Upon submission by a sports lottery agent of a proposed plan for the lease or purchase of sports lottery machines in accordance with procedures to be established by the Director, the Lottery Director shall lease or purchase the number, type and kind of sports lottery machines necessary for the efficient and economical operation of the Lottery, or the convenience of the players, and in accordance with the plan of the licensee, provided that the Director may recommend the amendment of such plan where the Director finds that such amendments are necessary to increase revenues, protect the public welfare or ensure the security of the video lottery.  The Director's lease or purchase of sports lottery machines under this subsection shall be pursuant to the procedures used for procurement under Chapter 69 of this title.

(d) Each video lottery agent and sports lottery agent shall be responsible for the security and safekeeping of the video lottery machines and sports lottery machines of which it has physical custody.

(e) The Director shall contract with an independent laboratory to test video lottery machines, sports lottery machines and related equipment on a periodic basis to ensure that the machines and equipment comply with the requirements of this chapter and any other applicable standards and regulations.  The manufacturer, vendor or lessor of such machines and equipment shall pay all costs associated with such testing.

(f) Each video lottery agent and sports lottery agent shall hold the Director and this State harmless from and defend and pay for the defense of any and all claims which may be asserted against the Director, the State or the employees thereof, arising from the participation in the video lottery system; specifically excluding, however, any claims arising from the negligence or willful misconduct of the Director, the State or the employees thereof.

(g) Each video lottery agent and sports lottery agent shall provide access to all records of the licensee and the physical premises of the business or businesses where the agent's lottery activities occur for the purpose of monitoring or inspecting the agent's activities and the lottery games, machines and associated equipment.  None of the information disclosed pursuant to this subsection shall be subject to disclosure under the Freedom of Information Act, §§ 10001-10005 of this title.”.

Section  27.  Amend § 4822, Title 29 of the Delaware Code by deleting the words "racetrack property" and by substituting in lieu thereof the words "video lottery agent and sports lottery agent". 

Section 28.  This Act shall become effective May 1, 2009 or 14 days after it becomes law, whichever is later. 

Section  29.  If any provision of this Act or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to that end the provisions of this Act are declared to be severable.  


SYNOPSIS

This bill requires the Lottery Director to use his or her authority to reestablish a sports lottery, which will enhance the Delaware Lottery, protect Delaware employment, help Delaware and its lottery meet new competition, and provide additional revenues for the State.  The bill is intended to provide a significant additional source of revenue to the State.  The sports lottery excludes collegiate sporting events that involve a Delaware college or university.  Persons under the age of 21 will not be allowed to participate in the sports lottery.  The sports lottery excludes collegiate sporting events that involve a Delaware college or university. 

 

The bill would take advantage of an exemption granted to the State of Delaware under federal law, namely the Professional and Amateur Sports Protection Act, which allows the states of Delaware, Nevada, Oregon, and Montana to engage in sports betting.  This bill would authorize the conduct of a sports lottery at video lottery facilities and up to ten additional sports lottery facilities, which must be licensed restaurants, taverns, or taprooms.  Proceeds from the conduct of a sports lottery would be divided equally between the sports lottery agent and the State. 

 

The bill also recognizes the substantial economic contributions to the State by video lottery agents with respect to entertainment, gaming, and horse racing facilities, as well as with respect to job creation, and will expand the contribution of video lottery operations to the State by authorizing up to three additional video lottery agents.  The bill also increases the share of video lottery proceeds received by the State to make that share comparable to the amounts received by surrounding states. 

 

The bill would create the Video and Sports Lottery Licensing Commission, which would be responsible for granting licenses to sports lottery agents and video lottery agents.  The Commission would be composed of appointees of the President Pro Tempore of the State Senate, the Speaker of the House of Representatives, the Minority Leader of the State Senate, the Minority Leader of the House of Representatives, the Director of the Delaware Economic Development Office, the Secretary of Finance and an appointee of the Governor.