SGC-29-15-00026-P New York Lottery Draw Game Rules, Including Rules Implementing Changes to Powerball Lottery Game

7/22/15 N.Y. St. Reg. SGC-29-15-00026-P

NEW YORK STATE REGISTER

VOLUME XXXVII, ISSUE 29

July 22, 2015

RULE MAKING ACTIVITIES

NEW YORK STATE GAMING COMMISSION

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. SGC-29-15-00026-P

New York Lottery Draw Game Rules, Including Rules Implementing Changes to Powerball Lottery Game

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

Proposed Action:

Amendment of sections 5004.9(a), 5007.2(a)(15), 5007.13, 5007.15(a)(14), 5007.16(a)(14), 5.009.2 and 5010.2 of Title 9 NYCRR.

Statutory authority:

Racing, Pari-Mutuel Wagering and Breeding Law, section 104; Tax Law, sections 1601, 1604, 1612 and 1617

Subject:

New York Lottery draw game rules, including rules implementing changes to Powerball lottery game.

Purpose:

Implement nationwide changes to Powerball multi-state lottery game; make "Quick Pick" definition consistent for all draw games.

Text of proposed rule:

PART 5004

Draw Games

§ 5004.9. General definitions, qualifications, restrictions, validations and rules applying to Lottery Draw games.

(a) * * *

(7) [Random selection option (commonly referred to as Quick Pick, Easy Pick, or a similar term) means the option given to players to have the game character(s) to be played randomly selected by computer. The random selection option is initiated by the terminal operator and may be used to select all the game character(s) required for the game or to complete a bet in which fewer than the full complement of game character(s) have been chosen. When the random selection option is used, the bet will be entered by computer in the next scheduled drawing and the numbers to be played will be randomly selected by computer. If a player using the random selection option specifies such player’s choice of draw date(s), then only the remaining bet data variables will be selected by computer.] Quick Pick means a method in which some or all character selections are determined at random by the computer system at the time of purchase. If a player communicates some character selections orally or by play slip, any remaining character selections may be determined by Quick Pick.

* * *

(9) Draw game ticket or bet ticket means the ticket generated by the computer terminal based on input received from the player's play card, [random selected] quick pick option or manual entry. Bet tickets may be purchased only from licensed sales agents as previously defined herein. The bet ticket is the only valid receipt for a bet placed. Players should, while still at the point of purchase, verify the game and number selections on the bet ticket.

PART 5007

Multi-Jurisdictional Lottery Games

* * *

§ 5007.2. Mega Millions definitions.

(a) The following definitions shall apply to Mega Millions.

* * *

(15) Quick pick [means a player option in which Mega Millions number selections are determined at random by the computer system at the time of purchase] has the meaning set forth in paragraph (7) of subdivision (a) of section 5004.9 of this Subchapter.

* * *

§ 5007.13. Powerball.

(a) Purpose.

(1) The purpose of the Powerball Game (also referred to as Powerball) is the generation of revenue for education in New York State through the operation of a specially-designed multi-state lottery game that will award prizes to holders of tickets matching specified combinations of numbers randomly selected in regularly scheduled drawings.

(2) During each Powerball drawing, six Powerball winning numbers will be selected from two fields of numbers in the following manner: five winning numbers from a field of one through [59] 69, and one winning number from a field of one through [35] 26.

(b) Definitions. The following definitions apply to Powerball:

* * *

(2) Quick Pick [means a player option in which Powerball number selections are determined at random by the computer system at the time of purchase] has the meaning set forth in paragraph (7) of subdivision (a) of section 5004.9 of this Subchapter.

(3) Powerball Play Area means the area of the play slip, also known as a panel that contains two sets of numbered spaces to be marked by a player, the first set containing [59] 69 spaces, numbered one through [59] 69 and the second set containing [35] 26 spaces, numbered one through [35] 26.

* * *

(5) Powerball Winning numbers means the six numbers, the first five from a field of [59] 69 numbers and the last one from a field of [35] 26 numbers, randomly selected at each drawing, which shall be used to determine winning plays shown on a game ticket.

* * *

(c) Game Description.

(1) Powerball is a five out of [59] 69 plus one out of [35] 26 computerized lottery game that pays the jackpot prize, at the election of the player made in accordance with this section or by a default election made in accordance with this section, either on an annuitized pari-mutuel basis or as a lump sum payment of the total cash held for this prize pool on a pari-mutuel basis. Except as provided in this section, all other prizes are paid on a fixed lump sum basis. To play Powerball, a player may select five different numbers, from one through [59] 69 and one additional number from one through [35] 26. The additional number may be the same as one of the first five numbers selected by a player. A player may select a set of five numbers and one additional number by communicating the six numbers to a lottery sales agent, or by marking six numbered spaces in any one panel on a play slip and submitting the play slip to an agent or by requesting quick pick from an agent. An agent will then issue a ticket containing the selected set or sets of numbers, each of which constitutes a game play.

* * *

(h) Prize Pool, Prize Structure and Probability of Winning.

* * *

(3) Expected Prize Payout Percentages. The Jackpot Prize shall be determined on a pari-mutuel basis. Except as provided in this section, all other prizes shall be paid as fixed lump sum prizes with the following expected prize payout percentages:

Prize Pool Percentage
Number of Matches Per Play	Prize Payment	Allocated to Prize
All five of first set plus one of second set.	Jackpot prize	[63.9511] 68.0131%
All five of first set and none of second set.	$1,000,000	[19.4038] 8.5558%
[Any four of first set plus one of second set.]	[$10,000]	[1.5409%]
Any four of first set plus one of second set.	$50,000	5.4757%
Any four of first set and none of second set.	$100	[0.5239] 0.2738%
Any three of first set plus one of second set.	$100	[0.8167] 0.6899%
Any three of first set and none of second set.	$7	[1.9437] 1.2074%
Any two of first set plus one of second set.	$7	[0.9909] 0.9981%
Any one of first set plus one of second set.	$4	[3.6097] 0.3489%
None of first set plus one of second set.	$4	[7.2194] 10.4373%

* * *

(6) Probability of Winning. The following table sets forth the probability of winning and the probable distribution of winners in and among each prize category based upon the total number of possible combinations in Powerball.

Probability Distribution
Number of Matches Per Ticket	Winners	[Probability] Odds 1 in	[Probable/Set] Prize Amount
All five of first set plus one of second set.	1	[1:175,223,510.0000] 292,201,338.0000	Jackpot prize
All five of first set and none of second set.	[38] 25	[1:5,153,632.6471] 11,688,053.5200	$1,000,000
Any four of first set plus one of second set.	[270] 320	[1:648,975.9630] 913,129.1813	[$10,000] $50,000
Any four of first set and none of second set.	[9,180] 8,000	[1:19,087.5283] 36,525.1673	$100
Any three of first set plus one of second set.	[14,310] 20,160	[1:12,244.8295] 14,494.1140	$100
Any three of first set and none of second set.	[486,540] 504,000	[1:360.1420] 579.7646	$7
Any two of first set plus one of second set.	[248,040] 416,640	[1:706.4325] 701.3281	$7
Any one of first set plus one of second set.	[1,581,255] 3,176,880	[1:110.8129] 91.9775	$4
None of first set plus one of second set.	[3,162,510] 7,624,512	[1:55.4065] 38.3239	[$3] $4
Overall	[5,502,140] 11,750,538	[1:31.8464] 24.8671

* * *

§ 5007.15. Cash 4 Life.

(a) Definitions. The following definitions apply to the Cash 4 Life:

* * *

(14) Quick pick [means a player option in which Cash 4 Life number selections are determined at random by the computer system at the time of purchase] has the meaning set forth in paragraph (7) of subdivision (a) of section 5004.9 of this Subchapter.

§ 5007.16. Monopoly™ Millionaires’ Club™.

(a) Definitions. The following definitions apply to the Monopoly Millionaires’ Club:

* * *

(14) Quick pick [means a method in which some or all Monopoly Millionaires’ Club number selections are determined at random by the computer system at the time of purchase] has the meaning set forth in paragraph (7) of subdivision (a) of section 5004.9 of this Subchapter. Quick pick is a player option in the Monopoly Millionaires’ Club game for selection of up to five number selections ranging from one through 52, but the number ranging from one through 28, representing a Monopoly property, must be selected by quick pick.

PART 5009

New York’s Numbers

* * *

§ 5009.2. Game Description.

New York's Numbers game shall determine winners from tickets by matching a permutation or segment of a three-digit number from 000 to and including 999, randomly drawn at a regularly scheduled daily drawing. Correctly matching the three-digit number or designated permutation thereof shall entitle the ticket holder to one of those prizes as described below:

* * *

(e) To place a bet, a purchaser communicates the desired bet data (day, amount, bet type and bet number selections) to an agent, who will issue a bet ticket. If desired, a purchaser may use the [random number] quick pick option [(commonly referred to as “quick pick,” “easy pick,” or a similar term)] for deciding bet number selections. When the [random number] quick pick option is used, the bet will be entered by computer in the next scheduled drawing as a straight bet in the amount of 50 cents and the numbers to be played will be randomly selected by computer. A purchaser using the [random number] quick pick option may specify such purchaser’s own choice of drawing date (s), bet type or bet amount. The agent enters the bet into a secure computer system via a computer terminal. Upon acceptance of and payment for the ticket issued by the agent, the transaction shall become binding and final.

PART 5010

Win-4

* * *

§ 5010.2. Game description.

Win-4 game shall determine winners from tickets matching a permutation of a four-digit number from 0000 to and including 9999 randomly drawn at a regularly scheduled drawing conducted by the Lottery as described in section 5010.4 of this Part. Correctly matching the winning four-digit number drawn, or a designated permutation thereof shall entitle the ticket holder to one of the prizes described in subdivision (c) of this section.

* * *

(e) To place a bet, a purchaser communicates the desired bet data (day, amount, bet type and bet number selections) to a game agent, who will issue a bet ticket. If desired, a purchaser may use the [random number] quick pick option [(commonly referred to as “quick pick,” “easy pick,” or a similar term)] for deciding bet number selections. When the [random number] quick pick option is used, the bet will be entered by computer in the next scheduled drawing as a straight bet in the amount of 50 cents and the numbers to be played will be randomly selected by computer. A purchaser using the [random number] quick pick option may specify such purchaser’s own choice of drawing date (s), bet type or bet number. The agent enters the bet into a secure computer system via a computer terminal. Upon acceptance of and payment for the ticket issued by the agent, the transaction shall become binding and final.

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, 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.

Regulatory Impact Statement

1. STATUTORY AUTHORITY: The New York State Gaming Commission (“Commission”) is authorized to promulgate the proposed rules by Tax Law Sections 1601, 1604, 1612(a) and 1617 and by Racing, Pari-Mutuel Wagering and Breeding Law (“Racing Law”) Sections 103(2), 104(1) and 104(19).

Tax Law Section 1601 describes the purpose of Article 34 of the Tax Law, also known as the New York State Lottery for Education Law, 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 and Section 1617 authorizes the Commission’s Director of the Lottery Division to enter into an agreement with a government-authorized group of one or more jurisdictions for the operation and administration of such a lottery.

Racing Law Section 103(2) mandates that the Commission operate and administer the state lottery for education, as prescribed by Article 34 of the Tax Law. Racing Law Section 104(1) grants the Commission general jurisdiction over all gaming activities within the State. Racing Law Section 104(19) authorizes the Commission to promulgate any rules it deems necessary to carry out its responsibilities.

2. LEGISLATIVE OBJECTIVES: To permit the State’s continued participation in the Powerball multi-jurisdiction lottery game and to implement changes to the game that are expected to generate more revenue for education.

3. NEEDS AND BENEFITS: Powerball is a multi-state lottery game that New York offers pursuant to an agreement among various state lotteries, as authorized by Tax Law Sections 1617, 1612(a) and 1604. The consortium of State lotteries that participate in Powerball and the Multi-State Lottery Association (“MUSL”) that administers Powerball, have approved and adopted amendments to the game intended to be effective nationwide with sales effective on October 4, 2015 for the drawing on October 7, 2015. Consortium participants are required to comply with official Powerball game rules, as amended. The proposed rulemaking incorporates amendments necessary for New York’s continued participation in the Powerball game. In addition, these amendments are expected to increase ticket sales and generate more revenue for education.

Powerball awards prizes to holders of tickets matching specified combinations of numbers randomly selected in regularly scheduled drawings. Players select five numbers from one set and one number from a second set. The proposed rules are intended to increase the odds of winning any prize, while also allowing jackpot prize amounts to grow larger by decreasing the odds of winning a top prize. This would be accomplished by increasing the size of the first set of numbers from which a player chooses (from 59 to 69), while decreasing the size of the second set of numbers (from 35 to 26). The proposed rules would also change the percentage amount of a prize pool allocated to each prize level and would increase the set prize amount for the third-level prize from $10,000 to $50,000.

The proposed draw games rules would amend the “quick pick” definition applicable to all lottery draw games, including Powerball. The revised definition would clarify the various methods a player can use to determine character selections when purchasing a ticket for a draw game; namely that a player can communicate a partial subset of the required character selections orally or through a play slip and have the computer system supply, through random choice, the remaining selections.

Without the proposed rules, the Commission would need to remove the Powerball game from its portfolio of offerings and aid to education would be negatively affected. Last fiscal year just over $300 million in Lottery sales were from the Powerball game. This was the lowest amount in three fiscal years. This change to the Powerball matrix is predicted to increase the average overall jackpot throughout the year and increase sales in New York and aid to education from this product.

4. COSTS:

(a) Costs to regulated parties for the implementation and continuing compliance with the rule: None.

(b) Costs to the regulating agency, the State, and local governments for the implementation and continued administration of the rule: No additional operating costs are anticipated as a result of the proposed rules, since current funds reserved for administrative expenses of operating lottery games are expected to be sufficient.

(c) The information, including the source or sources of such information, and methodology upon which the cost estimate is based: The cost estimates are based on the New York Lottery’s experience regulating lottery games for more than 40 years.

5. LOCAL GOVERNMENT MANDATE: There are no local government mandates associated with the proposed rules.

6. PAPERWORK: The proposed rules impose no changes in paperwork requirements. Game information will be issued by the New York Lottery for public convenience on the Lottery’s website and through point of sale advertising materials at retailer locations.

7. DUPLICATION: The proposed regulations do not duplicate any existing State or federal requirements of the same or similar subject matter.

8. ALTERNATIVES: Without the amended rules, the New York Lottery would need to remove the game from its portfolio of offerings and aid to education would be negatively affected.

9. FEDERAL STANDARDS: The proposed amendments do not exceed any minimum standards of the federal government for the same or similar subject areas.

10. COMPLIANCE SCHEDULE: The proposed rules will become effective upon publication of a Notice of Adoption in the State Register.

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

The proposed rules changes do not require a Regulatory Flexibility Analysis, Rural Area Flexibility Analysis or Job Impact Statement. There will be no adverse impact on small businesses, local governments, rural areas or jobs.

The proposed rules would permit New York’s continued participation in the Powerball multi-jurisdiction lottery game and implement changes to the game that are expected to generate more revenue for education.

The proposed rules will not impose any adverse economic impacts or reporting, recordkeeping or other compliance requirements on small businesses, local governments, rural areas or employment opportunities.