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| Montana Administrative Register Notice 23-16-219 | No. 13 07/14/2011 | |
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BEFORE THE DEPARTMENT OF JUSTICE OF THE STATE OF
TO: All Concerned Persons 1. On August 9, 2011, at 9:00 a.m., the Montana Department of Justice will hold a public hearing in the conference room at the Gambling Control Division, 2. The Department of Justice will make reasonable accommodations for persons with disabilities who wish to participate in this public hearing or need an alternative accessible format of this notice. If you require an accommodation, contact the department no later than 5:00 p.m. on August 3, 2011, to advise us of the nature of the accommodation that you need. Please contact Rick Ask, Gambling Control Division, 3. The proposed new rules provide as follows: NEW RULE I Advertising Restrictions for Video Gambling Machines (1) A licensed video gambling machine operator, distributor, route operator, or manufacturer may only advertise the play, lease, or sale of video gambling machines authorized by Title 23, part 5, MCA. No signs or advertisements may make any explicit or implicit reference to illegal gambling devices, such as slot machines, including equipment associated with illegal gambling devices. AUTH: 23-5-115, 23-5-603, 23-5-621, MCA IMP: 23-5-603, MCA RATIONALE AND JUSTIFICATION: Senate Bill 361, enacted by the 2011 Legislature, prohibits any reference to authorized gambling activity in advertisements, promotions, or inducements to gamble, and it requires the department to seek compliance with the advertising prohibition through rule adoption. This proposed new rule is necessary to define and implement the advertising prohibition in 23-5-603, MCA by providing a sufficiently broad definition of the type of advertising that is allowed, in conjunction with a more specific prohibition against any advertising that references illegal gambling devices such as slot machines. NEW RULE II Expiration Date for Video Gambling Machine Ticket Vouchers (1) Except as provided in (2), location operators must immediately pay all valid ticket vouchers in full and in cash upon presentation of the ticket for payment. (2) A video gambling machine ticket voucher that is printed more than 48 hours before it has been presented for payment may, at the discretion of the location operator, be deemed invalid and not payable, only if there has been notice to the player of the expiration period by the presence of a sign that is not less than 24 inches by 36 inches displayed in a licensed premises at the time of play, in plain view of the gambling public, which reads "Promptly Redeem Your Win Tickets -- Tickets Void After 48 hours;" and (a) for machines and programs approved prior to adoption of this rule, the face of the video gambling machine ticket voucher paper has been preprinted with the expiration notice required by ARM 23.16.1901; or (b) for machines and programs approved after adoption of this rule, the expiration notice is printed on the face of the video gambling machine ticket voucher as required by ARM 23.16.1901. IMP: 23-5-608, MCA RATIONALE AND JUSTIFICATION: The 2011 Legislature enacted HB 127, which in part authorizes the department to establish by rule a reasonable expiration period for video gambling machine (VGM) ticket vouchers. Currently, video gambling machine ticket vouchers must be paid in cash whenever the ticket is presented for payment, even months after the ticket is printed from the VGM. This proposed new rule is reasonable and necessary to create a period of time after the printing of a VGM ticket voucher for a player to present the ticket to the operator for payment. The proposed 48-hour expiration period is believed to be reasonable so long as a VGM player has reasonable notice that the ticket will expire. Such notice is considered reasonable when there is a sign posted on the premises of sufficient size that the average VGM player would view it, and with text, clearly printed on the face of the VGM ticket voucher, that notifies the VGM player of the expiration time for redemption of the ticket. Under this proposed new rule, it is within the operator's discretion whether or not to pay an expired VGM ticket voucher. NEW RULE III SOFTWARE SPECIFICATIONS FOR VIDEO LINE GAMES (1) Each video line game must meet the following specifications for approval for use within the state of (a) draw and display a minimum of three numbers or symbols in a line; (b) clearly identify each individual line that is brought into play by wagering additional money when more than one line is played during a game; (c) display and identify each winning combination of numbers or symbols, if any, and the amount won, if any, at the end of each game; (d) the movement of numbers or symbols stops automatically, or the player may manually stop the movement prior to the automatic stop; (e) provide winning combinations that form a vertical, horizontal, or diagonal line or other specified shapes that may include: (i) matching numbers or symbols; or (ii) particular numbers or symbols that appear in any sequence or position; and (f) provide a theoretical return of each bet increment not to exceed 92%. (2) Licensed machine manufacturers submitting video line games for approval must supply written verification from a qualified independent testing service that the theoretical return for each bet increment does not exceed 92%. For purposes of this rule, a qualified independent testing service means a person or entity that: (a) holds a current Montana Associated Gambling Business License; (b) shares no common ownership interests with the licensed machine manufacturer that submits the video line game to the department for approval; and (c) has at least one contract with, or is licensed by, another governmental entity to test gambling machines and provide mathematical certification for the maximum theoretical return for video gambling machine software. AUTH: 23-5-115, 23-5-602, 23-5-603, 23-5-621, MCA IMP: 23-5-602, 23-5-603, 23-5-607, 23-5-608, 23-5-611, 23-5-621, MCA
RATIONALE AND JUSTIFICATION: The 2011 Legislature enacted SB 361, which authorized video line games to be included with video keno, video bingo and video poker in multigame video gambling machines. This proposed new rule is reasonable and necessary to provide the software specifications for manufacturers of video gambling devices, in the same manner that the department provides by rule the software specifications for video keno, video poker, and video bingo. In drafting these software specifications, the department looked to state administrative regulations of jurisdictions that have authorized video line games. While 23-5-607, MCA directs the department to prescribe a minimum theoretical payback of at least 80% for all video gambling machines, SB 361 amends 23-5-607, MCA to provide an additional requirement that each video line game may not have an expected payback greater than 92%. This proposed rule is therefore necessary to implement the new payout restrictions on video line games. The proposed rule requires manufacturers who submit video line game software for approval to provide the department with a certification from a qualified testing laboratory that the video line game does not have an expected payback of greater than 92%. The proposed rule establishes criteria for the labs that may provide the maximum theoretical return certification. The criteria will ensure that the certifying entity meets Montana's suitability requirements for an associated gambling business, is independent of the submitting manufacturer, and is qualified to do the mathematical computations and analysis necessary to determine the maximum theoretical return of the video line game submitted for approval. NEW RULE IV SPECIAL BINGO SESSIONS (1) A licensed operator granted an annual permit by the department to conduct live bingo games on a specified premises may apply for a permit to conduct a special bingo session. (2) To apply for a special bingo session permit, the operator shall submit an application to the department on Form 38, which is available from the department. The application for a special bingo session must include: (a) licensed operator's name; (b) operator license number; (c) location of the special bingo session; (d) date and start time of the special bingo session; (e) date of applicant's most recent special bingo session; and (f) $10 processing fee. (3) The special bingo session application must be received by the department at least ten working days before the start of the proposed special bingo session. The department may process an application received by fax but shall not issue a permit on such an application until the fee is received by the department. An application may not receive approval if received by the department less than ten working days before the date of the proposed start of the special bingo session. (4) A special bingo session permit issued to an operator shall be counted against the allotment of annual special bingo sessions whether or not the special bingo session was held by the operator. (5) A special bingo session must be publicly identified as being a special bingo session. (6) An operator's special bingo session permit must be posted and clearly visible to the public. The permit is specific to an operator and location. An operator may conduct up to five special bingo sessions per year. At least 30 days must elapse between each special bingo session. (7) Special bingo sessions must comply with the requirements of Title 23, chapter 5, MCA, and the rules of the department. AUTH: 23-5-115, MCA RATIONALE AND JUSTIFICATION: HB 127, enacted by the 2011 Legislature, provides general revisions to the maximum prices and payouts for live bingo games. The bill provides for limited special bingo sessions which are subject to department approval and permitting in a manner similar to other special gambling event permits, such as calcutta pools, casino nights, and poker tournaments. This proposed new rule is reasonable and necessary to establish the criteria for the issuance of a special bingo session permit, and it establishes the application and permitting procedures required by the department for a person to obtain a special bingo session permit. These procedures are borrowed in large part from the procedures and language previously adopted in ARM 23.16.1101 for the permitting of live card game tournaments. 4. The rules proposed to be amended provide as follows, stricken matter interlined, new matter underlined: 23.16.1802 DEFINITIONS (1) through (13) remain the same. (14) "Multigame machine" means a video gambling machine that at all times offers for play to the public, within the same video gambling machine cabinet, a combination of (a) video poker; (b) video keno; (c) video bingo; and (d) video line games. (15) through (23) remain the same. (24) "Video gambling machine" means a video poker, video keno, or video bingo machine as defined in 23-5-112, MCA, and (25) remains the same. (26) "Video line game" means a game in which numbers and/or symbols are drawn using a random number generator and displayed on a video screen in a variety of alignments or orders with a chance of achieving a defined outcome. (26) and (27) remain the same but are renumbered (27) and (28). AUTH: 23-5-115, 23-5-602, 23-5-621, MCA IMP: 23-5-111, 23-5-112, 23-5-115, 23-5-151, 23-5-602, 23-5-603, 23-5-607, 23-5-608, 23-5-610, 23-5-611, 23-5-612, 23-5-621, 23-5-637, MCA RATIONALE AND JUSTIFICATION: The 2011 Legislature enacted SB 361, which authorized video line games to be included with video keno, video bingo, and video poker in multigame video gambling machines. This proposed rule amendment is reasonable and necessary to provide the definition of a video line game, and to clarify the definition of a multigame machine. This rule amendment is also necessary to clarify that a multigame video gambling machine must at all times offer to the public at least two types of the video gambling approved by the Legislature. SB 361 amends 23-5-602, MCA to provide definitions for "multigame" and "video line game," but the law directs the department to define video line games, and restricts video line games to the confinement of multigame machine cabinets. This proposed rule amendment clarifies that an approved multigame machine may not be manipulated in such way as to offer only a single type of video gambling game. This amendment makes plain that a gambling machine operator, for example, may not inactivate video keno and video poker games in a multigame machine cabinet in a manner that results in only video line games being available for play on the machine. 23.16.1901 GENERAL SPECIFICATIONS OF VIDEO GAMBLING MACHINES (1) through (1)(d)(vii)(J) remain the same. (K) this notice clearly displayed on the ticket: "Ticket Void After 48 hours." (viii) through (3) remain the same. IMP: 23-5-115, 23-5-136, 23-5-602, 23-5-606, 23-5-608, 23-5-609, 23-5-610, 23-5-621, 23-5-637, MCA RATIONALE AND JUSTIFICATION: HB 127, enacted by the 2011 Legislature, authorizes the department to establish by rule a reasonable expiration period for video gambling machine (VGM) ticket vouchers. The expiration period will be reasonable when a VGM player receives notice that the ticket will expire. This proposed rule amendment is reasonable and necessary to create a period of time after the printing of a VGM ticket voucher for a player to present the ticket to the operator for payment. 23.16.1906 GENERAL SOFTWARE SPECIFICATIONS FOR VIDEO GAMBLING MACHINES (1) through (1)(g) remain the same. (h) poker, keno, (i) prominently displays the message "Promptly Redeem Your Win Tickets – Tickets Void After 48 hours" when the printing of a cash ticket is initiated; (i) and (j) remain the same but are renumbered (j) and (k). (2) remains the same. (3) Unattended or auto-play is prohibited except for free games initiated by or as a result of a trigger game. (3) remains the same but is renumbered (4). AUTH: 23-5-115, 23-5-602, 23-5-621, MCA IMP: 23-5-111, 23-5-112, 23-5-115, 23-5-151, 23-5-602, 23-5-603, 23-5-607, 23-5-608, 23-5-611, 23-5-621, 23-5-637, MCA
RATIONALE AND JUSTIFICATION: The 2011 Legislature authorized video line games to be included with video keno, video bingo, and video poker in multigame video gambling machines. This proposed rule amendment is reasonably necessary to include video line games in the software specifications. The 2011 Legislature also authorized the department to establish a reasonable stale date for video gambling machine ticket vouchers. The amendment requires video gambling machines to display a screen that gives notice to a player that a win ticket will become invalid after 48 hours, and the department believes notice to the player is of central importance to the reasonableness of the 48-hour stale date. The amendment also clarifies that video gambling machines may not allow unattended play (auto-play) when wagers are at risk and player intervention and/or choices are required in the play of the game. An exception is included for free games won as the result of a trigger game because the games are free, and do not risk or require a wager. 23.16.1909A SOFTWARE SPECIFICATIONS FOR VIDEO MULTIGAME MACHINES (1) remains the same.
(a) offer at least two approved types of games as follows:
(iv) video line games that comply with [New Rule III]. AUTH: 23-5-115, 23-5-602, 23-5-621, MCA IMP: 23-5-602, 23-5-603, 23-5-608, 23-5-611, 23-5-621, 23-5-631, 23-5-637, MCA
RATIONALE AND JUSTIFICATION: As explained in the rationale and justification for New Rule III and the proposed amendment to ARM 23.16.1802, the 2011 Legislature authorized video line games to be offered by licensed gambling operators only in multigame machines. This proposed amendment to ARM 23.16.1909A is reasonable and necessary to include video line games to the other regulated types of video gambling, clarifies that multigame machines must offer at least two types of approved video gambling, and makes other nonsubstantive stylistic changes to the rule.
23.16.1910A BONUS GAMES (1) The department may approve bonus games that can be awarded to the player as a result of playing video poker, keno, (a) before a bonus game may be awarded to the player, the player must achieve a (b) the theoretical return of (2) remains the same. (3) Video AUTH: 23-5-115, 23-5-602, 23-5-621, MCA IMP: 23-5-112, 23-5-602, 23-5-603, 23-5-608, 23-5-611, 23-5-621, MCA RATIONALE AND JUSTIFICATION: As explained in the rationale and justification for New Rule III and the proposed amendment to ARM 23.16.1802, the 2011 Legislature enacted SB 361 which authorized video line games to be offered by licensed gambling operators in multigame machines. SB 361 also amended the definition of a "bonus game" in 23-5-602, MCA to a prize for achieving a "defined outcome" instead of a "win." This proposed amendment to ARM 23.16.1910A is reasonable and necessary to include video line games to the other regulated types of video gambling, to update the reference from "win" to "defined outcome," and make other nonsubstantive stylistic changes to the rule. 23.16.1920 AUTOMATED ACCOUNTING AND REPORTING SYSTEM, VIDEO GAMBLING MACHINE, HARDWARE AND SOFTWARE SPECIFICATIONS (1) remains the same. (a) The GSA SAS protocol specification documents may be obtained from GSA Main Office, (b) The required minimum implementation of the GSA SAS protocol is defined in the Montana SAS Serial Protocol Implementation Guide. The guide is available on the Montana Department of Justice, Gambling Control Division web site (www.doj.mt.gov/gaming) and is available by request from the Gambling Control Division, Technical Services Section, 2550 Prospect Ave., P.O. Box 201424, Helena, MT 59620-1424; (406) 444-1971. (2) remains the same. IMP: 23-5-603, 23-5-621, 23-5-637, MCA RATIONALE AND JUSTIFICATION: The department is proposing to amend ARM 23.16.1920 to correct and update the address, phone number, and e-mail address of the Gaming Standards Association (GSA), and to correct and update the web site information for the Gambling Control Division. These are clerical corrections and are not intended to have a substantive effect on the rule itself. 23.16.1924 PROHIBITED MACHINES (1) Any machine which, in substance, simulates the game of video poker, keno, (2) Except as provided in ARM 23.16.
AUTH: 23-5-115, 23-5-602, 23-5-605, MCA IMP: 23-5-152, 23-5-602, 23-5-603, 23-5-605, 23-5-606, 23-5-607, 23-5-608, 23-5-609, 23-5-611 23-5-613, MCA RATIONALE AND JUSTIFICATION: As explained in the rationale and justification for New Rule III and the proposed amendment to ARM 23.16.1802, the 2011 Legislature authorized video line games to be offered by licensed gambling operators. This proposed amendment to ARM 23.16.1924 is reasonable and necessary to include video line games to the other regulated types of video gambling referred to in the rule. This amendment also updates and corrects the citation to another rule. This is a clerical correction and is not intended to have a substantive effect on the rule itself. 23.16.1927 APPROVAL OF VIDEO GAMBLING MACHINES AND/OR MODIFICATIONS TO APPROVED VIDEO GAMBLING MACHINES BY DEPARTMENT (1) through (3)(a) remain the same. (b) all the information required in ARM 23.16. (c) through (4) remain the same. AUTH: 23-5-115, 23-5-602, 23-5-605, 23-5-621, MCA IMP: 23-5-605, 23-5-606, 23-5-611, 23-5-621, 23-5-631, MCA RATIONALE AND JUSTIFICATION: The department is proposing to amend ARM 23.16.1927 to correct the citation to another rule and add authorizing and implementing statutes. This is a clerical correction and is not intended to have a substantive effect on the rule itself. 23.16.1931 INSPECTION AND SEIZURE OF MACHINES (1) The department has the right at all times to make an examination of any machine being used to play or simulate video poker, (2) and (3) remain the same. AUTH: 23-5-115, 23-5-602, 23-5-621, MCA IMP: 23-5-113, 23-5-602, 23-5-603, 23-5-608, 23-5-611, 23-5-613, 23-5-621, MCA RATIONALE AND JUSTIFICATION: As explained in the rationale and justification for New Rule III and the proposed amendment to ARM 23.16.1802, the 2011 Legislature authorized video line games to be offered by licensed gambling operators. This proposed amendment to ARM 23.16.1931 is reasonable and necessary to include video line games to the other regulated types of video gambling referred to in the rule. 23.16.2001 MANUFACTURER OF ILLEGAL GAMBLING DEVICES - LICENSE - FEE - REPORTING REQUIREMENTS - INSPECTION OF RECORDS - REPORTS (1) through (8) remain the same. (9) Form 22 is available from the Gambling Control Division, 2550 Prospect Ave., P.O. Box 201424, Helena, MT 59620-1424, or on the department's web site (www.doj.mt.gov/gaming/forms.asp). AUTH: 23-5-115, 23-5-152, 23-5-621, MCA IMP: 23-5-112, 23-5-115, 23-5-152, 23-5-611, 23-5-614, 23-5-621, 23-5-625, 23-5-631, MCA RATIONALE AND JUSTIFICATION: The department is proposing to amend ARM 23.16.2001 to add the Gambling Control Division's web address where Form 22 may be obtained online. This is merely an update to the rule. No substantive change is intended. 23.16.2101 COMBINATION OF VIDEO POKER, KENO, AUTH: 23-5-115, 23-5-602, 23-5-612, 23-5-621, MCA RATIONALE AND JUSTIFICATION: As explained in the rationale and justification for New Rule III and the proposed amendment to ARM 23.16.1802, the 2011 Legislature authorized video line games to be offered by licensed gambling operators. This proposed amendment to ARM 23.16.2101 is reasonable and necessary to include video line games to the other regulated types of video gambling referred to in the rule. 23.16.2109 TESTING OF AUTOMATED ACCOUNTING AND REPORTING SYSTEMS (1) remains the same. (a) the continued reporting and maintenance of records as provided in ARM 23.16.1826, 23.16.1826A, and 23.16.1827, during the test period; (b) through (5) remain the same.
RATIONALE AND JUSTIFICATION: The department is proposing to amend ARM 23.16.2109 to include reference to rule ARM 23.16.1826A, which was adopted in 2009 but inadvertently not included by reference in ARM 23.16.2109. The proposed amendment is reasonably necessary to include the reporting requirements under ARM 23.16.1826A to the tests contemplated under ARM 23.16.2109. 23.16.2401 DEFINITIONS Throughout this subchapter, the following definitions apply: (1) remains the same. (2) "Bingo" means a game of chance played for prizes with cards bearing numbers as described in law, in which the holder covers such numbers when objects similarly numbered are drawn or electronically determined, and in which the game is won by persons covering one or more previously designated arrangements of numbers on such cards. A game of bingo begins with the first number called and ends when an individual or individuals cover (3) remains the same. (4) "Game" means a (5) through (14) remain the same. AUTH: 23-5-115, MCA IMP: 23-5-112, 23-5-409, 23-5-412, MCA
RATIONALE AND JUSTIFICATION: HB 127, enacted by the 2011 Legislature, provides general revisions to the maximum prices and payouts for live bingo games, and defines regular and special live bingo sessions, and established maximum total prize payouts for each of the regular and special sessions. The proposed amendments to ARM 23.16.2401 are reasonable and necessary because the definition of bingo need not include prize limits, as those limits are provided in ARM 23.15.2406. The amendment also attempts to clarify the definition of "game," which should now omit the word "session" to avoid confusion with the definition of "bingo session" now in statute.
23.16.2406 PRIZE AWARDS FOR LIVE KENO AND BINGO GAMES (1) through (2)(b) remain the same. (i) the prizes paid out exceed (ii) the total prizes paid during a regular bingo session exceed $3,000; (iii) the total prizes paid during a special bingo session exceed $5,000; (ii) and (iii) remain the same but are renumbered (iv) and (v). AUTH: 23-5-115, MCA IMP: 23-5-412, MCA
RATIONALE AND JUSTIFICATION: The 2011 Legislature enacted HB 127 which defined regular and special live bingo sessions, and established maximum total prize payouts for each of the regular and special sessions. This proposed amendment to ARM 23.16.2406 is therefore reasonable and necessary to correct and update the references to these new prize limitations. 5. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to Rick Ask, Gambling Control Division, 2550 Prospect Avenue, P.O. Box 201424, Helena, MT 59620-1424; fax (406) 444-9157; or e-mail [email protected], and must be received no later than August 11, 2011. 6. An electronic copy of this Notice of Proposed Amendment is available through the Department of Justice's web site at http://doj.mt.gov/resources/administrativerules.asp. The department strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the Department of Justice works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems. 7. The Department of Justice maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request which includes the name and mailing address of the person to receive notices and specifies that the person wishes to receive notices of rules regarding the Crime Control Division, the Central Services Division, the Forensic Sciences Division, the Gambling Control Division, the Highway Patrol Division, the Law Enforcement Academy, the Division of Criminal Investigation, the Legal Services Division, the Consumer Protection Division, the Motor Vehicle Division, the Justice Information Systems Division, or any combination thereof. Such written request may be mailed or delivered to Rick Ask, 2550 Prospect Avenue, P.O. Box 201424, Helena, MT 59620-1424; fax (406) 444-9157; or e-mail [email protected], or may be made by completing a request form at any rules hearing held by the Department of Justice. A copy of the interested persons request form may be printed from the Department of Justice's web site at http://www.doj.mt.gov/resources/forms/interestedperson.pdf, and mailed to the rule reviewer. 8. Cregg Coughlin, Assistant Attorney General, Gambling Control Division, has been designated to preside over and conduct the hearing. 9. The bill sponsor contact requirements of 2-4-302, MCA, do apply and the primary bill sponsors were initially contacted on April 13, 2011 by e-mail and U.S. Postal mail. By: /s/ Steve Bullock /s/ J. Stuart Segrest STEVE BULLOCK J. STUART SEGREST Attorney General, Department of Justice Rule Reviewer Certified to the Secretary of State July 5, 2011.
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A directory of state agencies is available online at http://www.mt.gov/govt/agencylisting.asp.
For questions about the organization of the ARM or this web site, contact [email protected].
