AMEND House Substitute No. 1 for House Bill 100 by deleting Section 1 thereto in its entirety and substituting in lieu thereof the following:

“Section 1. Amend Title 29 of the Delaware Code by adding a new Section 4825 to read as follows:

‘§4825. Table Games and Sports Lottery.

(a) The Director shall, pursuant to the authority granted under §§4805(a)(1) and 4805(b)(4) of this chapter, establish a regulatory framework for table games no later than December 1, 2009, commence table game operations no later than March 1, 2010, and commence a sports lottery as soon as practicable. The Director shall, by rules and regulations, provide for the features and attributes of the table game operations and the sports lottery after consultation with industry experts. With respect to the sports lottery, this shall include the retention of at least one independent industry expert with recent and relevant experience in sports wagering operations and consideration of best practices in the most successful sports wagering operations in the United States.

(b) The regulations must administer table game operations and the sports lottery in a manner which minimizes or eliminates the risk of financial loss to the State. The Director shall employ a reputable and fiscally responsible firm to provide risk management services for the sports lottery.

(c) A person under the age of 21 may not wager on a sports lottery machine or table game equipment or in any way participate in table games or the sports lottery.

(d) Table game operations and the sports lottery must be conducted exclusively at video lottery facilities owned and operated by video lottery agents licensed in the State on December 31, 1996. Licenses previously awarded to video lottery agents relative to the video lottery are considered amended to allow those agents to act as agents for the State with respect to table game operations and the sports lottery.".

FURTHER AMEND House Substitute No. 1 for House Bill 100, by deleting Section 2 in its entirety and substituting in lieu thereof the following:

“Section 2. Amend §4803, Title 29 of the Delaware Code by deleting subsections (j) and (k) in their entirety and by substituting in lieu thereof new subsections (j) - (q) to read:

‘(j) ‘Video lottery operations employee’ shall mean an individual employee, person or agent of an applicant or licensee who is responsible for the security of video lottery machines, table game equipment or sports lottery machines or responsible for handling proceeds from any of the foregoing, or is otherwise employed in a position that allows direct access to the internal workings of such machines or equipment.

(k) ‘Credit Slip’ shall mean the receipt generated by a video lottery terminal when a player is playing that particular video lottery terminal, or the ticket resulting from a table game or sports lottery game.

(l) 'Sports lottery' means a lottery in which the winners are determined based on the outcome(s) (or any other aspect) of any collegiate or professional sporting event, including racing, held within or without the State, but excluding collegiate sporting events that involve a Delaware college or university and amateur or professional sporting events that involve a Delaware team (provided that this exclusion shall not apply to professional auto racing events in which a Delaware team may be competing).

(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) ‘Table game’ shall mean any game played with cards, dice or any mechanical, electromechanical or electronic device or machine (excluding video lottery machines) for money, credit or any representative of value, including, but not limited to, baccarat, blackjack, twenty one, poker, craps, roulette, keno, bingo, wheel of fortune or any variation of these games, whether or not similar in design or operation, provided that the game is expressly authorized by rule of the Director, and further provided that if the game has mixed elements of chance and skill that chance is the dominant factor in the game.

(o) ‘Table game equipment’ shall mean gaming tables, cards, dice, chips, shufflers, drop boxes or any other mechanical, electronic or other device, mechanism or equipment or related supplies (including any hardware and software used by the State) used or consumed in the operation of any table games.

(p) ‘2009 threshold’ shall refer to a video lottery agent’s gross lottery proceeds, for the period beginning July 1, 2008 and ending June 30, 2009 and for purposes of §4815(b)(2) shall be considered exceeded for any particular fiscal year from July 1 to June 30, for purposes of the calculations in such subsection, at the point where the video lottery agent’s gross lottery proceeds for such fiscal year is greater than the 2009 threshold.

(q) ‘gross lottery proceeds’ for a video lottery agent shall refer to the video lottery agent’s proceeds, net of proceeds returned to players under §4815(b)(1), whether attributable to the video lottery, the sports lottery or table games.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100, by deleting Section 3 in its entirety and by substituting in lieu thereof the following:

“Section 3. Amend §4805(a), Title 29 of the Delaware Code, by deleting ‘video lottery machines’ and by substituting in lieu thereof ‘the video lottery, table games and sports lottery.”

FURTHER AMEND House Substitute No. 1 for House Bill 100, by deleting Section 4 in its entirety and by substituting in lieu thereof the following:

“Section 4. Amend §4805(a), Title 29 of the Delaware Code by deleting subsections (12)-(13) in their entirety and by substituting in lieu thereof new subsections to read as follows:

‘(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, table games and the sports lottery;

(13) Value of bills, coins or tokens needed to play the video lottery, table games and the sports lottery;’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100, by deleting Section 5 in its entirety and by substituting in lieu thereof the following:

“Section 5. Amend §4805(a), Title 29 of the Delaware Code by deleting subsections (16)-(17) 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, 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 to notify the Director on a continuing basis of any change in officers, partners, directors, key employees, video 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 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, 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, and persons who own, directly or indirectly, 10% or more of such entity;’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 on line 96 by adding the phrase "table games" after the words "video lottery machines" and before the words "and sports".

FURTHER AMEND House Substitute No. 1 for House Bill 100, by deleting Section 8 in its entirety and by substituting in lieu thereof the following:

“Section 8. Amend §4805(a), Title 29 of the Delaware Code, by adding thereto a new subsection to read as follows:

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

FURTHER AMEND House Substitute No. 1 for House Bill 100 by deleting Sections 10 through 15 in their entirety and appropriately renumbering all Sections after substituting a new “Section 10” in lieu of the deleted sections as follows:

“Section 10. Amend §4815, Title 29 of the Delaware Code, by deleting subsections (b)(2) and (b)(3) in their entirety and by substituting in lieu thereof new subsections (b)(2) and (b)(3) to read as follows:

‘(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:

a. fifty percent (50%) of average daily win from the video lottery and the sports lottery; provided that for any video lottery agent whose gross lottery proceeds for the prior fiscal year (measured for theses purposes on the twelve months ended May 31) was less than $175,000,000, this percentage shall be reduced to forty-eight (48%) of average daily win; and further provided that in any given fiscal year if a video lottery agent’s 2009 threshold is exceeded, this percentage shall be appropriately increased (other than for an agent governed by the immediately preceding proviso) but only with respect to proceeds in excess of the 2009 threshold so that the effective rate of fifty percent which the State receives under this subsection after sharing in purses, hardware and software and risk management expenses will amount to fifty-three percent (53%);

b. 50% of average daily win from table games after subtracting table gaming operations certified payroll and expenses;

c. the funds on each credit slip that has not been presented for redemption within 1 year from the date the slip is issued;

d. funds sufficient to pay one-half of all hardware and software costs (including but not limited to video lottery machines and related equipment, table game equipment, sports lottery machines and franchise fees) whether owned or leased by the State, used or under the control of the video lottery agents, and any risk manager employed by the State in connection with the sports lottery; and

e. funds sufficient to pay one-half of all purses required to be paid under §4815(b)(3).

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, table games and the sports lottery, including, but not limited to, administrative expenses including payroll and other employment costs attributable to such operations 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, table games and the sports lottery; second, $1,000,000 or 1%, whichever is greater, of the proceeds distributed under (b)(2) 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; fourth, there shall be remitted to the video lottery agents funds sufficient to pay all purses required to be paid under §4815(b)(3); and fifth the remainder shall be paid into the State's General Fund.

Administrative costs and expenses referred to in the preceding paragraph shall include the following: The State shall pay for all hardware and software costs (including but not limited to video lottery machines and related equipment, table game equipment, sports lottery machines and franchise fees), whether leased or owned by the State, used or under the control of such agent, the cost of any risk manager employed by the State in connection with the sports lottery, and the cost of the central computer used to monitor the equipment used by the agent. 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)a.2.B. 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)a.1. of this section.

(3) Application of remaining proceeds. -- The proceeds remaining after payments as set forth in paragraphs (1) and (2) of this subsection, as augmented by the State’s requirement to remit to the video lottery agents funds sufficient to pay all purses required hereunder, shall be applied as follows:

a. Purses. --

1. For video lottery agents licensed only to conduct horse racing meets under Chapter 101 of Title 3 or Chapter 4 of Title 28, such agents shall be paid and shall pay additional purses (and related administrative expenses of the horse racing association) to be applied under the direction of the Delaware Thoroughbred Racing Commission, for races conducted at such agent's racetrack in accordance with § 10148 of Title 3 or § 427 of Title 28 as appropriate, in an amount calculated as follows: nine percent (9%) of the proceeds from the video lottery remaining after payments made under paragraph (b)(1) of this section; nine percent (9%) of the proceeds from the sports lottery remaining after payments made under paragraph (b)(1) of this section; and four and one-half percent (4.5%) of the proceeds from table games remaining after payments made under paragraph (b)(1) of this section. Five hundred thousand dollars of the aforementioned proceeds, which would otherwise fund purses, on an annual basis, shall fund a Delaware Certified Thoroughbred Program (DCTP) to enhance the quantity of thoroughbred foals and/or yearlings stabled within Delaware for a period meeting the Delaware minimum residency requirement. The DCTP shall be administered by a Board comprised of the following:

A. Four members of the Delaware Thoroughbred Horseman's Association;

B. One member designated by the video lottery agent licensed to conduct live thoroughbred horse racing meets under Chapter 101 of Title 3;

C. One member appointed by the Speaker of the House of the General Assembly;

D. One member appointed by the President Pro Tempore of the Senate of the General Assembly;

E. The Secretary of Agriculture or the Secretary's designee; and

F. The Secretary of Finance or the Secretary's designee. Members shall be chosen by the organizations they represent, and shall serve 4 year terms, except the 4 initial Board members selected by the Delaware Thoroughbred Horseman's Association shall serve an initial term of 2 years, and 4 years thereafter. The Board created hereunder must develop and present a plan for the administration of the DCTP no later than December 31, 2005. This plan and all subsequent plans amending the DCTP shall be subject to the written approval of the Secretary of Agriculture or the Secretary's designee, the Secretary of Finance or the Secretary's designee, and the Chairperson of the Thoroughbred Racing Commission or the Chairperson's designee. The Board shall transmit minutes and actions from all meetings to the Chairperson of the Delaware Thoroughbred Racing Commission within 10 days of the meeting. The Board shall submit an annual report detailing the allocation of such funds of the DCTP to the Commission and make available to the State Auditor such information as may be required to perform an annual audit of funds allocated from the DCTP. The Board may also, at its discretion, use funds from the DCTP for advertising, promotion, education and administrative purposes directly related to the program, however, the total amount for these purposes cannot exceed 5% of the total allocation. Funds dedicated to the DCTP shall not be subject to a 1-year payout requirement, but payouts may be dispersed throughout the year.

2. For video lottery agents licensed only to conduct harness racing meets under Chapter 100 of Title 3, such agents shall be paid and shall pay additional purses (and related administrative expenses of the horse racing association) to be applied under the direction of the Delaware Harness Racing Commission to purses for races conducted at such agent's racetrack in accordance with § 10048 of Title 3, in an amount calculated as follows:

A. Ten and three-quarters percent (10.75%) of the proceeds from the video lottery remaining after payments made under subsection (b)(1) of this section; ten and two-tenths percent (10.2%) of the proceeds from the sports lottery remaining after payments made under subsection (b)(1) of this section; and four and one-half percent (4.5%) of the proceeds from table games remaining after payments made under paragraph (b)(1) of this section.

B. One million five hundred thousand dollars of those proceeds, which would otherwise fund purses, on an annual basis ($ 750,000 to come from each licensee which conducts live harness horse racing) to be set aside for purses under paragraph (b)(3)b.2. of this section shall be used to fund a Delaware Standardbred Breeder's Program which shall be administered by a board comprised of 4 members from the Delaware Standardbred Owners Association, 1 member from the Standardbred Breeders and Owners of Delaware, Inc., 1 member from each video lottery agent licensed to conduct harness racing meets under Chapter 100 of Title 3, 1 member appointed by the Speaker of House of the General Assembly, 1 member appointed by the President Pro Tempore of the Senate of the General Assembly, the Secretary of Agriculture or the Secretary's designee, and the Secretary of Finance or the Secretary's designee. Members shall be chosen by the organizations they represent, and shall serve 4-year terms except that 4 of the initial board selected by the members of the Delaware Standardbred Owners Association shall serve an initial term of 2 years, and 4 years thereafter. The board created hereunder will present a plan for the administration of the Program to the General Assembly no later than May 15, 1999. This plan, and all subsequent amendments to the plan, shall be subject to the written approval of the Secretary of Agriculture or the Secretary's designee, the Chairperson of the Delaware Harness Racing Commission or the Chairperson's designee, and the Secretary of Finance or the Secretary's designee. The board shall transmit minutes of all meetings and any proposed actions to the Delaware Harness Racing Commission within 10 days after each meeting. The board shall transmit an annual report detailing the allocation of proceeds from the fund and make available to the State Auditor or the State Auditor's representative such information as may be required to perform an annual audit of funds allocated from the Delaware Standardbred Breeder's Program. In addition to funding special purses for Delaware standardbred horses, the board created hereby may also use the funds dedicated to this Program for advertising, promotion, educational and administrative purposes. Funds dedicated to the Delaware Standardbred Breeder's Program shall not be subject to the 1-year payout requirement of § 10048 of Title 3.

3. For video lottery agents licensed to conduct harness horse racing meets under Chapter 100 of Title 3 on January 1, 1993, such agents, which in the future also conduct horse racing meets under Chapter 101 of Title 3 or Chapter 4 of Title 28, shall be paid and shall pay additional purses (and related administrative expenses of the horse racing association) administered by either the Delaware Thoroughbred Racing Commission or the Delaware Harness Racing Commission, as appropriate, in accordance with the formula set forth in sub-subparagraph 2. of this subparagraph, for races conducted at such agent's racetrack based on the ratio of live horse racing days to total live racing days and live harness horse racing days to total live racing days.

4. For video lottery agents licensed to conduct horse racing meets under Chapter 101 of Title 3 on January 1, 1993, such agents, which in the future also conduct harness horse racing meets under Chapter 100 of Title 3, shall be paid and shall pay additional purses (and related administrative expenses of the horse racing association) administered by either the Delaware Thoroughbred Racing Commission or the Delaware Harness Racing Commission, as appropriate, in accordance with the formula set forth in sub-subparagraph 1. of this subparagraph, for races conducted at such agent's racetrack based on the ratio of live horse racing days to total live racing days and live harness racing days to total live racing days.

b. Jockey health and other welfare benefits. -- For video lottery agents which are licensed only to conduct thoroughbred horse racing meetings under Chapter 101 of Title 3 or Chapter 4 of Title 28, such agents annually shall be paid and shall pay the sum of $175,000 plus an additional $175,000 (which shall be subtracted from the amount such agent is paid and shall pay as additional purses under paragraph (b)(3)b.1 of this section) for a total payment of $350,000 annually, adjusted for inflation by the Delaware Thoroughbred Racing Commission, which shall be payable to fund a Delaware Jockeys Health and Welfare Benefit Fund on July 20 of each year. The Fund shall be used to provide, for jockeys who regularly ride in Delaware, health and other welfare benefits for active, disabled and retired jockeys pursuant to reasonable criteria for benefit eligibility. The Jockeys Health and Welfare Benefit Fund shall be administered by a Board, known as the Jockeys Health and Welfare Benefit Board, comprised of 1 member of the Delaware Thoroughbred Racing Commission, 1 member from the licensed agent under Chapter 101 of Title 3 or Chapter 4 of Title 28, 1 member of the Delaware Horsemen's Association, and 1 representative from the organization that represents the majority of the jockeys who are licensed and ride regularly in Delaware, and 2 jockeys who are licensed and ride regularly in Delaware. The Chairman of the Commission shall serve as an ex officio member and vote on matters in the event of a tie vote on any issue. Members shall be appointed by the Commission and shall serve 2-year terms. In addition to providing funding for jockey health and other welfare benefits, the fund may expend reasonable expenses for administrative purposes.

c. Commissions to agents. -- The portion of such proceeds remaining after the payments required by paragraphs (b)(3)a. and b. of this section shall be paid to such video lottery agent as commission.

For video lottery agents licensed only to conduct horse racing meets under Chapter 101 of Title 3 or Chapter 4 of Title 28, such agents shall pay $250,000 of the proceeds received under this section to fund the video lottery agent's contribution to the Delaware Certified Thoroughbred Program (DCTP) annually. Said amount shall be allocated as of January 1 of each calendar year.

For video lottery agents licensed only to conduct harness racing meets under Chapter 100 of Title 3, each agent shall pay $375,000 of the proceeds received under this section to fund the video lottery agent's contribution to the Delaware Standardbred Breeder's Program annually. Said amount shall be allocated as of January 1 of each calendar year.

Subsections (b)(2) and (b)(3) shall be effective upon enactment of this Act and prior to such date proceeds shall be distributed in accordance with the statute as previously in effect.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 by deleting Section 16 in its entirety and substituting a new Section 11 in lieu thereof the following:

“Section 11. Amend §4819, Title 29 of the Delaware Code by deleting subsections (a) and (c) in their entirety and by substituting in lieu thereof subsections (a) and (c) to read:

‘(a) Video lottery machines, table game equipment and sports lottery machines shall only be located 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.

(c) Video lottery machines and sports lottery machines shall be connected to the lottery's central computer system, except when used for promotional tournaments in which players are not required to pay any fee to participate, and shall not be available for play on Christmas, or after 4:00 a.m. on Easter. Subject to the foregoing, the specific hours of operation for each video lottery agent are subject to the recommendation of the Lottery Director and the approval of the Secretary of Finance.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 by deleting Section 18 in its entirety and substituting in lieu thereof the following:

“Section 13. Amend §4819, Title 29 of the Delaware Code, by adding thereto a new subsection (d) to read as follows:

‘(d) The State shall collect from the video lottery agents when table game operations commence but no later than June 30 of each year beginning June 30, 2010, an annual license fee totaling $4,500,000, in the aggregate, for the privilege of operating table games. The State shall also collect from the video lottery agents no later than June 30, 2009 an annual license fee totaling $3,000,000, in the aggregate, for the privilege of conducting a sports lottery. Each video lottery agent shall be liable for and shall pay to the State its share of such license fees that is in proportion to the amount of the gross lottery proceeds of that agent for the preceding twelve months ending May 31 in comparison to the total gross lottery proceeds recovered by the State during such period from all three video lottery agents. The license fees collected pursuant to this subsection shall be contributed to the General Fund.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 by deleting Section 19 in its entirety and substituting in lieu thereof the following:

“Section 14. 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 as follows:

‘(a) All video lottery machines, table game equipment 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, table game equipment and sports lottery machines shall be leased or purchased under the procedures set forth in Chapter 69 of this title. Any video 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, table game equipment 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, table game equipment 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, table game equipment and sport 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 such 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 lottery, will protect the public welfare, and will ensure the security of the lottery.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 by deleting Section 20 in its entirety and substituting in lieu thereof the following:

“Section 15. Amend §4820, Title 29 of the Delaware Code, by deleting subsections (b)(2) through (b)(5) in their entirety and by deleting subsections (c), (d) and (f) in their entirety, redesignating subsection (e) as subsection (f), and by inserting new subsections (c), (d), (e) and (g) to read as follows:

‘(c) Upon submission by a video lottery agent of a proposed plan for the lease or purchase of sports lottery machines and table game equipment in accordance with procedures to be established by the Director, the Director shall lease or purchase the number, type and kind of sports lottery machines and table game equipment 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 and table game equipment under this subsection shall be pursuant to the procedures used for procurement under Chapter 69 of this title.

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

(e) The Director shall contract with an independent laboratory to test video lottery machines, sports lottery machines, table game equipment 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.

(g) Each video 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.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 by adding a new Section 16 to read as follows:

“Section 16. Amend Section 10048 of Title 3 of the Delaware Code by striking subsection (1) b.3. in its entirety and substituting in lieu thereof the following:

‘3. No authorization of any new form of gambling beyond that as existing under the Code on February 1, 1994 at any venue other than the licensees conducting live harness or thoroughbred horse races as of February 1, 1994 (including but not limited to any increase in the number of video lottery agents), except for changes to “class II gaming” (as currently defined under 25 U.S.C. § 2703) conducted by nonprofit and charitable organizations.’ ”.

FURTHER AMEND House Substitute No. 1 for House Bill 100 by adding a new Section 17 to read as follows:

Section 17. Amend Title 11 of the Delaware Code by adding a new Section 1413 to read as follows:

“1413. Exemption for operations of lottery under State control.

The sale, lease, transport, ownership, possession, exhibition, manufacture, servicing, marketing or use of a video lottery machine, a sports lottery machine, table game equipment or any equipment, supplies, information or data in connection with the operations of a lottery under State control (including the operations of a video lottery agent in accordance with Chapter 48 of Title 29) shall not be unlawful.”

FURTHER AMEND House Substitute No. 1 for House Bill 100 by adding a new Section 18 to read as follows:

"Section 18. Sections 10 and 13 of this Act shall expire three (3) years after its enactment into law unless otherwise provided by a subsequent act of the General Assembly.".

SPONSOR:	Rep. Cathcart & Rep. D. Short & Rep. Kovach & Rep. Blakey