SGC-14-14-00011-P Addition of a New Multi-Jurisdiction Lottery Game

4/9/14 N.Y. St. Reg. SGC-14-14-00011-P

NEW YORK STATE REGISTER

VOLUME XXXVI, ISSUE 14

April 09, 2014

RULE MAKING ACTIVITIES

NEW YORK STATE GAMING COMMISSION

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. SGC-14-14-00011-P

Addition of a New Multi-Jurisdiction Lottery Game

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

Proposed Action:

Addition of section 5007.15 to Title 9 NYCRR.

Statutory authority:

Tax Law, sections 1601, 1604, 1612(a) and 1617; Racing Pari-Mutuel Wagering and Breeding Law, sections 103(2), 104(1) and (19)

Subject:

Addition of a new multi-jurisdiction lottery game.

Purpose:

To permit the Commission to raise revenue for education with a new lottery game.

Substance of proposed rule (Full text is posted at the following State website:http://www.gaming.ny.gov):

This amendment of Part 5007, Multi-Jurisdictional Games, of Subtitle T of Title 9 NYCRR will add a new Section 5007.15, to allow the New York State Gaming Commission (“Commission”) to offer the Cash 4 Life game.

The purpose of Cash 4 Life is the generation of revenue for education in New York through the operation of a multi-state lottery game that will award prizes to ticket holders matching specified combinations of numbers randomly selected in regularly-scheduled drawings.

The new section of the Gaming Commission regulations describes the Cash 4 Life as a multi-jurisdictional lottery game similar to Powerball and the Mega Millions games that have been offered in New York and other states since 2002. Subdivision (a) sets forth some definitions. Subdivision (b) governs ticket pricing and the terms and conditions of ticket sales. Subdivision (c) describes the game. During each Cash 4 Life drawing, six Cash 4 Life Winning Numbers will be selected from two fields of numbers in the following manner: five winning numbers from a field of 60 numbers and one winning number from a field of numbers one through four, inclusive. The objective of Cash 4 Life drawings shall be to select at random, with the aid of drawing equipment, Cash 4 Life Winning Numbers, pursuant to the controls and methods established for the game. A player who matches all numbers is eligible for a jackpot prize.

Subdivision (d) sets forth play characteristics and restrictions. Subdivision (e) describes the time and place of drawings. Subdivision (f) details the prize structure and probabilities of winning. Subdivision (g) describes the payment options that may be chosen by a winner. Subdivision (h) governs the limits of payments and distribution of prizes when there are multiple winners. Subdivision (i) indicates that Parts 5003 and 5004 govern this new game. Subdivision (j) states that this new section applies only to the new Cash 4 Life game.

The full text of this proposed rule is posted on the Commission’s website, www.gaming.ny.gov.

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

Kristen Buckley, New York State Gaming Commission, 1 Broadway Center, PO Box 7500, Schenectady, New York 12301, [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.

Regulatory Impact Statement

1. Statutory authority: The New York State Gaming Commission (“Commission”) is authorized to promulgate this rule by Tax Law Sections 1601, 1604, 1612(a) and 1617 and by Racing, Pari-Mutuel Wagering and Breeding Law (“Racing Law”) Sections 103(2) and 104(1, 19). Tax Law Section 1601 describes the purpose of the New York State Lottery for Education Law (Tax Law Article 34) as being to establish a lottery operated by the State, the net proceeds of which are applied exclusively to aid to education. Tax Law Section 1604 authorizes the promulgation of rules governing the establishment and operation of such lottery. Tax Law Section 1612(a) describes the distribution of revenues for a joint, multi-jurisdiction, and out-of-state lottery. Section 1617 of such law authorizes the Commission to enter into an agreement with a government-authorized group of one or more other jurisdictions for the operation and administration of such a joint, multi-jurisdiction and out-of-state lottery.

Racing Law Section 103(2) provides that the Commission is responsible to operate and administer the state lottery for education, as prescribed by Article 34 of the Tax Law. Racing Law Section 104(1) provides the Commission with general jurisdiction over all gaming activities within the State and over any person, corporation or association engaged in such activities. Section 104(19) of such law authorizes the Commission to promulgate any rules it deems necessary to carry out its responsibilities.

2. Legislative objectives: To permit the Commission to operate a new multi-jurisdiction lottery game that will raise revenue for education.

3. Needs and benefits. This rule making will permit the Commission to offer a new multi-jurisdiction lottery game to increase lottery revenue for education.

The proposed amendment will permit the Commission to offer an alternative large jackpot multi-jurisdiction game to players that is expected to raise revenue for education because of variations in player preferences.

The Commission operates and administers joint, multi-jurisdiction, and out-of-state lottery games as a member of the Mega Millions Consortium, a government-authorized group formed by an agreement of the Commission with 10 other jurisdictions. Such Consortium takes concepts for possible new games and subjects them to consumer research, and then develops new multi-jurisdiction lottery games of interest to one or more members of the Consortium. This allows jurisdictions in the Consortium to introduce new multi-jurisdiction lottery games that appeal to consumer interest and increase the lottery sales and revenue.

Cash 4 Life is a new multi-jurisdiction game that has been developed by the Consortium. The Commission and one or more other jurisdictions are ready to operate and administer this new joint, multi-jurisdiction and out-of-state lottery game that is expected to increase lottery revenue for education in New York.

This proposal would authorize such lottery game in New York.

4. Costs:

a. Costs to regulated parties for the implementation and continuing compliance with the rule: There are no costs to stakeholders. Existing lottery agents will be able to sell these tickets the same as they do other lottery games.

b. Costs to the agency, the State, and local governments for the implementation and continuation of the rule: No additional operating costs are anticipated. The Commission can administer this game using existing resources.

c. Sources of cost evaluations: The foregoing cost evaluations are based on the Commission’s experience operating State Lottery games for more than 40 years.

5. Local government mandates: The proposed amendment does not impose any new programs, services, duties or responsibilities upon any country, city, town, village school district, fire district or other special district.

6. Paperwork: There are no changes in paperwork requirements. Lottery agents will be able to report the sales of this game using the same electronic reporting system.

7. Duplication: There are no relevant State programs or regulations that duplicate, overlap or conflict with the proposed amendment.

8. Alternatives: The alternative to amending these multi-jurisdictional regulations is to continue offering only the games currently offered. This alternative was rejected because offering new games is proven to generate greater revenue for education by attracting the interest of players and providing them with another game choice.

9. Federal standards: The proposed amendment does not exceed any minimum standards imposed by Federal government.

10. Compliance schedule: The Commission believes that regulated persons will be able to achieve compliance with the rule upon adoption of this rule.

Regulatory Flexibility Analysis, Rural Area Flexibility Analysis and Job Impact Statement

A regulatory flexibility analysis for small business and local governments, a rural area flexibility analysis, and a job impact statement are not required for this rule making because it will have no adverse effect on small businesses, local governments, rural areas, or jobs.

The rule making allows the Commission to offer customers a new play option, a multi-jurisdiction lottery game known as Cash 4 Life. This addition will impose no significant technological changes. No local government activity is involved. Lottery sales agents offer new or different lottery games only in order to increase sales. Customers are not required to play. There will be no new reporting, record keeping or other compliance requirements on small businesses or local governments or rural areas. The new lottery game will not adversely affect employment opportunities or jobs.

Based on the foregoing, no regulatory flexibility analysis for small businesses and local governments, rural area flexibility analysis, or a job impact statement is required for this proposed rule making.