LTR-49-10-00006-P Application and Employment After Denial or Revocation of License Permissible Lottery Players and Placement of ATMs

12/8/10 N.Y. St. Reg. LTR-49-10-00006-P

NEW YORK STATE REGISTER

VOLUME XXXII, ISSUE 49

December 08, 2010

RULE MAKING ACTIVITIES

DIVISION OF THE LOTTERY

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. LTR-49-10-00006-P

Application and Employment After Denial or Revocation of License Permissible Lottery Players and Placement of ATMs

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:

Proposed Action:

This is a consensus rule making to amend sections 2836-3.15, 2836-3.16, 2836-20.1(f) and 2836-23.3(a) of Title 21 NYCRR.

Statutory authority:

New York State Tax Law, sections 1601, 1604, 1612 and 1617-a

Subject:

Application and employment after denial or revocation of license permissible lottery players and placement of ATMs.

Purpose:

To clarify video gaming regulations and to comply with accepted industry standards.

Text of proposed rule:

Sections 2836-3.15 and 2836-3.16 are amended to read as follows:

2836-3.15 [Restriction on application] Application and employment after denial or revocation.

(a) Any natural person whose application for a license is denied, or whose license is suspended or revoked by reason of a failure to satisfy the affirmative qualification criteria required by these regulations, or due to a finding by the division that such person is disqualified, or both, may [not] re-apply for such license [for a period of three (3) years from the date of denial or revocation unless otherwise provided by these regulations] at any time.

[Notwithstanding the foregoing:

(1) If the denial or revocation was based upon conviction of a disqualifying offense and reapplication is to be evaluated under petition, reapplication is permitted only after the lapse of ten (10) years from the date of conviction;

(2) If the denial or revocation was based on acts constituting a disqualifying offense pursuant to these regulations and reapplication is to be evaluated under petition, reapplication is permitted after the lapse of ten (10) years from the date of the conduct in question; and

(3) If the division approves an agreement resolving an application for or a complaint seeking the revocation of a license which results in denial or revocation but permits reapplication or employment by a video lottery gaming agent after a stated period of less than three (3) years, eligibility for reapplication or employment shall be governed by the terms of the agreement and not by the provisions of these regulations.]

(b) Any natural person whose license application was denied, or whose license was suspended or revoked by the division on the basis of any of the statutory or regulatory provisions in [subsection] paragraphs (1) through (4) of this [part] subdivision (b) below, may reapply for a license upon satisfaction of the relevant requirements specified below. If the denial, suspension or revocation is based upon two (2) or more of such regulatory provisions, the division shall permit reapplication only upon compliance with the requirements of this [subsection] subdivision as to each such provision. Any person seeking to reapply pursuant to this [subsection] subdivision shall file a certified petition stating with particularity how the specified requirements have been satisfied.

(1) Failure to demonstrate financial stability: Reapplication is permitted upon achieving financial stability.

(2) Failure to satisfy the age requirement: Reapplication is permitted upon attaining the requisite age or upon a division finding that such age will be attained before the processing and approval of said reapplication has been completed.

(3) Pending disposition of a [charges for] charge of a [disqualifying] criminal offense if the Lottery has determined to deny a license application or suspend or revoke a license while such charge is pending: Reapplication is permitted upon disposition of the pending [charges provided the charges do not result in conviction of a disqualifying offense] charge.

(4) Any statutory or regulatory provision which is subsequently repealed or modified: Reapplication is permitted upon a showing that the subsequent repeal or modification of the statutory or regulatory provision obviates the grounds for denial or revocation and justifies the conclusion that the prior [decision] determination should [no longer bar reapplication] not be a basis for denying a license application.

(c) Except as otherwise set forth in these regulations, any person whose application has been denied or whose license has been revoked may reapply upon submission of sufficient evidence demonstrating that the factual circumstances upon which the denial was based have been cured to the satisfaction of the division.

(d) [Except as otherwise set forth in these regulations, any] Any person whose license has been revoked may reapply upon submission [within ninety (90) days of the date of revocation] of sufficient evidence demonstrating that the factual circumstances upon which the denial was based have been cured.

[2836-3.16 Petition for early reapplication.

(a) Any natural person who is barred by these rules from reapplication for at least three (3) years may petition the division for permission to reapply at an earlier date by filing a petition with the division at any time after one (1) year has elapsed from the date of denial or revocation or at such earlier date as the division may order. Any such petition shall state the type of credential sought, include a copy of the original application and the denial or revocation letter, the reasons for such denial and/or revocation, the reasons the applicant believes warrant reconsideration by the division, and any other information the applicant deems relevant.

(b) The division may grant a petition for early reapplication if it finds that the facts and circumstances presented would be reasonably likely to result in licensure, registration, qualification or approval if considered in the context of a plenary hearing. Factors to be considered by the division may include, where appropriate, evidence which would support:

(1) A finding of rehabilitation; or

(2) A waiver of disqualification.]

Subdivision (f) of Section 2836-20.1 is amended to read as follows:

(f) No video lottery gaming ticket shall be sold to or purchased by, and no video lottery gaming prize shall be paid to, any of the following persons:

(1) Any officer or employee of the division; or

(2) Any principal or key employee, except as may be permitted by the division for good cause shown; or

(3) Any video lottery gaming or non-gaming employee at the video lottery gaming facility that employs such person and at any other video lottery gaming facility controlled by that agent; or

(4) Any licensee, registrant, contractor, subcontractor, or consultant, or officer or employee of a contractor, subcontractor, licensee, registrant or consultant, if such person is directly involved in the operation of video lottery gaming, the operation or observation of video lottery gaming or drawings, or the processing of video lottery gaming prize claims or payments; or

(5) Any person subject to a contract with the division if such contract contains a provision prohibiting such person from purchasing a video lottery gaming ticket or receiving a video lottery gaming prize; or

(6) Any spouse, child, brother, sister or parent residing as a member of the same household in the principal place of abode of any of the foregoing persons at the same video lottery facility or facilities where the foregoing person is prohibited from purchasing a video lottery gaming ticket or collecting a video lottery gaming prize. This section shall not be deemed to prohibit the sale of a video lottery gaming ticket or the payment of a video lottery gaming prize to an officer or employee of the division or a video lottery gaming agent or to a contractor, subcontractor, or consultant or to an officer or employee of a contractor, subcontractor, or consultant if such sale or prize payment is not for the individual benefit of such person and is made in connection with an official investigation, audit, or other activity authorized by the director.

(7) The restrictions of this subdivision shall not apply to an employee of a video lottery gaming agent that is not licensed by the division.

(8) Nothing in this section shall prohibit a video lottery gaming agent from establishing a policy that is stricter than the standards described in this subdivision.

Subdivision (a) of Section 2836-23.3 is amended to read as follows:

2836-23.3 Credit; banking services at the video lottery gaming facility.

(a) The video lottery gaming agent may place a duly authorized automated teller machine (ATM) within a video lottery gaming facility at a location approved by the division[; however, such ATM shall not be positioned within the video lottery gaming floor].

Text of proposed rule and any required statements and analyses may be obtained from:

Julie B. Silverstein Barker, Associate Attorney, New York Lottery, One Broadway Center, PO Box 7500 Schenectady, NY 12301-7500, [phone], email: [e-mail]

Data, views or arguments may be submitted to:

Same as above.

Public comment will be received until:

45 days after publication of this notice.

Consensus Rule Making Determination

Sections 1604 and 1617-a of the New York State Lottery for Education Law (Article 34 of the Tax Law) establish the New York Lottery's (the "Lottery") authority to promulgate regulations governing its games and the operation of video lottery gaming.

The proposed amendments to sections 2836-3.15 and 2836-3.16 of the Lottery's regulations are being made to conform to the public policy of the State which is that there is a presumption of rehabilitation for persons with previous criminal convictions. Pursuant to Section 752 of the Correction Law (Article 23-A), no application for any license or license holder shall be denied or acted upon adversely by reason of the individual's having been previously convicted of one or more criminal offenses or by reason of a finding of lack of "good moral character" when such finding is based upon the fact that the individual has previously been convicted of one or more criminal offenses unless there is a direct relationship between the previous criminal offenses and the specific license or the issuance or continuation of the license would involve unreasonable risk to property or the safety or welfare of the public. The Lottery does and will continue to assess each application for a Lottery license based on factors enumerated in the Correction Law.

Currently, the Lottery has specific time periods contained within its regulations regarding reapplication for a license and also permit the Lottery the discretion to deviate from such times for good cause. However, in an effort to conform to the presumption of rehabilitation pursuant to the Correction Law, the Lottery is proposing to remove the specific time periods. No one is likely to object to these amendments because the amendments are being made to conform to the public policy of the State which is a presumption of rehabilitation for persons with previous criminal convictions.

The proposed amendments to section 2836-20.1 of the Lottery's regulations are being made to clarify the restriction against licensees playing at video lottery facilities. Currently, the restriction placed upon any spouse, child, brother, sister or parent residing as a member of the same household in the principal place of abode of certain licensees is inadvertently more prohibitive than the restriction placed upon the actual licensees due to a technical drafting error. No one is likely to object to these amendments because the amendments are being made to correct a technical error and do not change the enforcement of the restriction placed upon licensees and their family members living in the same household.

The proposed amendment to section 2836-23.3 is being made to remove a restriction related to placement of Automated Teller Machines ("ATMs") to conform to accepted industry standards. The Lottery's regulations currently prohibit placement of ATMs on the video gaming floor. Generally accepted gaming industry standards permit placement of ATMs and other methods of obtaining funds on gaming floors. No one is likely to object to this amendment because the amendment conforms with commonly and generally accepted standard gaming industry practices.

The Lottery has circulated these proposed amendments to its video lottery agents at all the existing video lottery facilities, as well as, to its agent at the planned video lottery facility at Aqueduct, which are subject to the Lottery's regulations. The agents did not raise any objection to this proposed rulemaking.

Job Impact Statement

The proposed amendment of 21 NYCRR Part 2836 does not require a Job Impact Statement because there will be no adverse impact on jobs and employment opportunities in New York. The proposed amendments to the New York Lottery’s regulations are being made to conform to the public policy of the State of a presumption of rehabilitation for persons with previous criminal convictions, to clarify the restriction against licensees playing at video lottery facilities, and to remove a restriction related to placement of Automated Teller Machines to conform to accepted industry standards. Such revisions to the regulations will not have any effect on jobs or employment opportunities.