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PAG LIN 1 1 Amend Senate File 453 as follows: 1 2 #1. Page 37, by inserting before line 6 the 1 3 following: 1 4 "DIVISION XVI 1 5 IOWA LOTTERY AUTHORITY 1 6 Sec. . NEW SECTION. 99G.1 TITLE. 1 7 This chapter may be cited as the "Iowa Lottery 1 8 Authority Act". 1 9 Sec. . NEW SECTION. 99G.2 STATEMENT OF 1 10 PURPOSE AND INTENT. 1 11 The general assembly finds and declares the 1 12 following: 1 13 1. That net proceeds of lottery games conducted 1 14 pursuant to this chapter should be transferred to the 1 15 general fund of the state in support of a variety of 1 16 programs and services. 1 17 2. That lottery games are an entrepreneurial 1 18 enterprise and that the state should create a public 1 19 instrumentality of the state in the form of a 1 20 nonprofit authority known as the Iowa lottery 1 21 authority with comprehensive and extensive powers to 1 22 operate a state lottery in an entrepreneurial and 1 23 businesslike manner and which is accountable to the 1 24 governor, the general assembly, and the people of the 1 25 state through a system of audits, reports, legislative 1 26 oversight, and thorough financial disclosure as 1 27 required by this chapter. 1 28 3. That lottery games shall be operated and 1 29 managed in a manner that provides continuing 1 30 entertainment to the public, maximizes revenues, and 1 31 ensures that the lottery is operated with integrity 1 32 and dignity and free from political influence. 1 33 Sec. . NEW SECTION. 99G.3 DEFINITIONS. 1 34 As used in this chapter, unless the context clearly 1 35 requires otherwise: 1 36 1. "Administrative expenses" includes, but is not 1 37 limited to, personnel costs, travel, purchase of 1 38 equipment and all other expenses not directly 1 39 associated with the operation or sale of a game. 1 40 2. "Authority" means the Iowa lottery authority. 1 41 3. "Board" means the board of directors of the 1 42 authority. 1 43 4. "Chief executive officer" means the chief 1 44 executive officer of the authority. 1 45 5. "Game specific rules" means rules governing the 1 46 particular features of specific games, including, but 1 47 not limited to, setting the name, ticket price, prize 1 48 structure, and prize claim period of the game. 1 49 6. "Instant lottery" or "instant ticket" means a 1 50 game that offers preprinted tickets such that when a 2 1 protective coating is scratched or scraped away, it 2 2 indicates immediately whether the player has won. 2 3 7. "Lottery", "lotteries", "lottery game", 2 4 "lottery games" or "lottery products" means any game 2 5 of chance approved by the board and operated pursuant 2 6 to this chapter and games using mechanical or 2 7 electronic devices, provided that the authority shall 2 8 not authorize a player-activated gaming machine that 2 9 utilizes an internal randomizer to determine winning 2 10 and nonwinning plays and that upon random internal 2 11 selection of a winning play dispenses coins, currency, 2 12 or a ticket, credit, or token to the player that is 2 13 redeemable for cash or a prize, and excluding gambling 2 14 or gaming conducted pursuant to chapter 99B, 99D, or 2 15 99F. 2 16 8. "Major procurement contract" means a consulting 2 17 agreement or a contract with a business organization 2 18 for the printing of tickets or the purchase or lease 2 19 of equipment or services essential to the operation of 2 20 a lottery game. 2 21 9. "Net proceeds" means all revenue derived from 2 22 the sale of lottery tickets or shares and all other 2 23 moneys derived from the lottery, less operating 2 24 expenses. 2 25 10. "On-line lotto" means a lottery game connected 2 26 to a central computer via telecommunications in which 2 27 the player selects a specified group of numbers, 2 28 symbols, or characters out of a predetermined range. 2 29 11. "Operating expenses" means all costs of doing 2 30 business, including, but not limited to, prizes and 2 31 associated prize reserves, computerized gaming system 2 32 vendor expense, instant and pull-tab ticket expense, 2 33 and other expenses directly associated with the 2 34 operation or sale of any game, compensation paid to 2 35 retailers, advertising and marketing costs, and 2 36 administrative expenses. 2 37 12. "Pull-tab ticket" or "pull-tab" means a game 2 38 that offers preprinted paper tickets with the play 2 39 data hidden beneath a protective tab or seal that when 2 40 opened reveals immediately whether the player has won. 2 41 13. "Retailer" means a person, licensed by the 2 42 authority, who sells lottery tickets or shares on 2 43 behalf of the authority pursuant to a contract. 2 44 14. "Share" means any intangible evidence of 2 45 participation in a lottery game. 2 46 15. "Ticket" means any tangible evidence issued by 2 47 the lottery to provide participation in a lottery 2 48 game. 2 49 16. "Vendor" means a person who provides or 2 50 proposes to provide goods or services to the authority 3 1 pursuant to a major procurement contract, but does not 3 2 include an employee of the authority, a retailer, or a 3 3 state agency or instrumentality thereof. 3 4 Sec. . NEW SECTION. 99G.4 IOWA LOTTERY 3 5 AUTHORITY CREATED. 3 6 1. An Iowa lottery authority is created, effective 3 7 September 1, 2003, which shall administer the state 3 8 lottery. The authority shall be deemed to be a public 3 9 authority and an instrumentality of the state, and not 3 10 a state agency. However, the authority shall be 3 11 considered a state agency for purposes of chapters 3 12 17A, 21, 22, 28E, 68B, 91B, 97B, 509A, and 669. 3 13 2. The income and property of the authority shall 3 14 be exempt from all state and local taxes, and the sale 3 15 of lottery tickets and shares issued and sold by the 3 16 authority and its retail licensees shall be exempt 3 17 from all state and local sales taxes. 3 18 Sec. . NEW SECTION. 99G.5 CHIEF EXECUTIVE 3 19 OFFICER. 3 20 The chief executive officer of the authority shall 3 21 be appointed by the governor subject to confirmation 3 22 by the senate and shall serve a four-year term of 3 23 office beginning and ending as provided in section 3 24 69.19. The chief executive officer shall be qualified 3 25 by training and experience to manage a lottery. The 3 26 governor may remove the chief executive officer for 3 27 malfeasance in office, or for any cause that renders 3 28 the chief executive officer ineligible, incapable, or 3 29 unfit to discharge the duties of the office. 3 30 Compensation and employment terms of the chief 3 31 executive officer shall be set by the governor, taking 3 32 into consideration the officer's level of education 3 33 and experience, as well as the success of the lottery. 3 34 The chief executive officer shall be an employee of 3 35 the authority and shall direct the day-to-day 3 36 operations and management of the authority and be 3 37 vested with such powers and duties as specified by the 3 38 board and by law. 3 39 Sec. . NEW SECTION. 99G.6 POWER TO ADMINISTER 3 40 OATHS AND TAKE TESTIMONY SUBPOENA. 3 41 The chief executive officer or the chief executive 3 42 officer's designee if authorized to conduct an 3 43 inquiry, investigation, or hearing under this chapter 3 44 may administer oaths and take testimony under oath 3 45 relative to the matter of inquiry, investigation, or 3 46 hearing. At a hearing ordered by the chief executive 3 47 officer, the chief executive officer or the designee 3 48 may subpoena witnesses and require the production of 3 49 records, paper, or documents pertinent to the hearing. 3 50 Sec. . NEW SECTION. 99G.7 DUTIES OF THE CHIEF 4 1 EXECUTIVE OFFICER. 4 2 1. The chief executive officer of the authority 4 3 shall direct and supervise all administrative and 4 4 technical activities in accordance with the provisions 4 5 of this chapter and with the administrative rules, 4 6 policies, and procedures adopted by the board. The 4 7 chief executive officer shall do all of the following: 4 8 a. Facilitate the initiation and supervise and 4 9 administer the operation of the lottery games. 4 10 b. Employ an executive vice president, who shall 4 11 act as chief executive officer in the absence of the 4 12 chief executive officer, and employ and direct other 4 13 such personnel as deemed necessary. 4 14 c. Contract with and compensate such persons and 4 15 firms as deemed necessary for the operation of the 4 16 lottery. 4 17 d. Promote or provide for promotion of the lottery 4 18 and any functions related to the authority. 4 19 e. Prepare a budget for the approval of the board. 4 20 f. Require bond from such retailers and vendors in 4 21 such amounts as required by the board. 4 22 g. Report semiannually to the legislative 4 23 government oversight committees regarding the 4 24 operations of the authority. 4 25 h. Report quarterly and annually to the board, the 4 26 governor, the auditor of state, and the general 4 27 assembly a full and complete statement of lottery 4 28 revenues and expenses for the preceding quarter, and 4 29 with respect to the annual report, for the preceding 4 30 year and transfer proceeds to the general fund within 4 31 thirty days following the end of the quarter. 4 32 i. Perform other duties generally associated with 4 33 a chief executive officer of an authority of an 4 34 entrepreneurial nature. 4 35 2. The chief executive officer shall conduct an 4 36 ongoing study of the operation and administration of 4 37 lottery laws similar to this chapter in other states 4 38 or countries, of available literature on the subject, 4 39 of federal laws and regulations which may affect the 4 40 operation of the lottery and of the reaction of 4 41 citizens of this state to existing or proposed 4 42 features of lottery games with a view toward 4 43 implementing improvements that will tend to serve the 4 44 purposes of this chapter. 4 45 3. The chief executive officer may for good cause 4 46 suspend, revoke, or refuse to renew any contract 4 47 entered into in accordance with the provisions of this 4 48 chapter or the administrative rules, policies, and 4 49 procedures of the board. 4 50 4. The chief executive officer or the chief 5 1 executive officer's designee may conduct hearings and 5 2 administer oaths to persons for the purpose of 5 3 assuring the security or integrity of lottery 5 4 operations or to determine the qualifications of or 5 5 compliance by vendors and retailers. 5 6 Sec. . NEW SECTION. 99G.8 BOARD OF DIRECTORS. 5 7 1. The authority shall be administered by a board 5 8 of directors comprised of five members appointed by 5 9 the governor subject to confirmation by the senate. 5 10 Board members appointed when the senate is not in 5 11 session shall serve only until the end of the next 5 12 regular session of the general assembly, unless 5 13 confirmed by the senate. 5 14 2. Board members shall serve staggered terms of 5 15 four years beginning and ending as provided in section 5 16 69.19. No more than three board members shall be from 5 17 the same political party. 5 18 3. Board members may be removed by the governor 5 19 for neglect of duty, misfeasance, or nonfeasance in 5 20 office. 5 21 4. No officer or employee of the authority shall 5 22 be a member of the board. 5 23 5. Board members shall be residents of the state 5 24 of Iowa, shall be prominent persons in their 5 25 respective businesses or professions, and shall not 5 26 have been convicted of any felony offense. Of the 5 27 members appointed, the governor shall appoint to the 5 28 board an attorney admitted to the practice of law in 5 29 Iowa, an accountant, a person who is or has been a law 5 30 enforcement officer, and a person having expertise in 5 31 marketing. 5 32 6. A majority of members in office shall 5 33 constitute a quorum for the transaction of any 5 34 business and for the exercise of any power or function 5 35 of the authority. 5 36 7. Action may be taken and motions and resolutions 5 37 adopted by the board at any meeting thereof by the 5 38 affirmative vote of a majority of present and voting 5 39 board members. 5 40 8. No vacancy in the membership of the board shall 5 41 impair the right of the members to exercise all the 5 42 powers and perform all the duties of the board. 5 43 9. Board members shall be considered to hold 5 44 public office and shall give bond as such as required 5 45 in chapter 64. 5 46 10. Board members shall be entitled to receive a 5 47 per diem as specified in section 7E.6 for each day 5 48 spent in performance of duties as members, and shall 5 49 be reimbursed for all actual and necessary expenses 5 50 incurred in the performance of their official duties 6 1 as members. No person who serves as a member of the 6 2 board shall by reason of such membership be eligible 6 3 for membership in the Iowa public employees' 6 4 retirement system and service on the board shall not 6 5 be eligible for service credit for any public 6 6 retirement system. 6 7 11. The board shall meet at least quarterly and at 6 8 such other times upon call of the chairperson or the 6 9 president. Notice of the time and place of each board 6 10 meeting shall be given to each member. The board 6 11 shall also meet upon call of three or more of the 6 12 board members. The board shall keep accurate and 6 13 complete records of all its meetings. 6 14 12. Meetings of the board shall be governed by the 6 15 provisions of chapter 21. 6 16 13. Board members shall not have any direct or 6 17 indirect interest in an undertaking that puts their 6 18 personal interest in conflict with that of the 6 19 authority, including, but not limited to, an interest 6 20 in a major procurement contract or a participating 6 21 retailer. 6 22 14. The members shall elect from their membership 6 23 a chairperson and vice chairperson. 6 24 15. The board of directors may delegate to the 6 25 chief executive officer of the authority such powers 6 26 and duties as it may deem proper to the extent such 6 27 delegation is not inconsistent with the Constitution 6 28 of this state. 6 29 Sec. . NEW SECTION. 99G.9 BOARD DUTIES. 6 30 The board shall provide the chief executive officer 6 31 with private-sector perspectives of a large marketing 6 32 enterprise. The board shall do all of the following: 6 33 1. Approve, disapprove, amend, or modify the 6 34 budget recommended by the chief executive officer for 6 35 the operation of the authority. 6 36 2. Approve, disapprove, amend, or modify the terms 6 37 of major lottery procurements recommended by the chief 6 38 executive officer. 6 39 3. Adopt policies and procedures and promulgate 6 40 administrative rules pursuant to chapter 17A relating 6 41 to the management and operation of the authority. The 6 42 administrative rules promulgated pursuant to this 6 43 subsection may include but shall not be limited to the 6 44 following: 6 45 a. The type of games to be conducted. 6 46 b. The sale price of tickets or shares and the 6 47 manner of sale, including but not limited to 6 48 authorization of sale of tickets or shares at a 6 49 discount for marketing purposes, provided, however, 6 50 that a retailer may accept payment by cash, check, 7 1 money order, debit card, or electronic funds transfer 7 2 and shall not extend or arrange credit for the 7 3 purchase of a ticket or share. As used in this 7 4 section, "cash" means United States currency. 7 5 c. The number and amount of prizes, including but 7 6 not limited to prizes of free tickets or shares in 7 7 lottery games conducted by the authority and 7 8 merchandise prizes. The authority shall maintain and 7 9 make available for public inspection at its offices 7 10 during regular business hours a detailed listing of 7 11 the estimated number of prizes of each particular 7 12 denomination that are expected to be awarded in any 7 13 game that is on sale or the estimated odds of winning 7 14 the prizes and, after the end of the claim period, 7 15 shall maintain and make available a listing of the 7 16 total number of tickets or shares sold in a game and 7 17 the number of prizes of each denomination that were 7 18 awarded. 7 19 d. The method and location of selecting or 7 20 validating winning tickets or shares. 7 21 e. The manner and time of payment of prizes, which 7 22 may include lump-sum payments or installments over a 7 23 period of years. 7 24 f. The manner of payment of prizes to the holders 7 25 of winning tickets or shares after performing 7 26 validation procedures appropriate to the game and as 7 27 specified by the board. 7 28 g. The frequency of games and drawings or 7 29 selection of winning tickets or shares. 7 30 h. The means of conducting drawings, provided that 7 31 drawings shall be open to the public and witnessed by 7 32 an independent certified public accountant. Equipment 7 33 used to select winning tickets or shares or 7 34 participants for prizes shall be examined by an 7 35 independent certified public accountant prior to and 7 36 after each drawing. 7 37 i. The manner and amount of compensation to 7 38 lottery retailers. 7 39 j. The engagement and compensation of audit 7 40 services. 7 41 k. Any and all other matters necessary, desirable, 7 42 or convenient toward ensuring the efficient and 7 43 effective operation of lottery games, the continued 7 44 entertainment and convenience of the public, and the 7 45 integrity of the lottery. 7 46 4. Adopt game specific rules. The promulgation of 7 47 game specific rules shall not be subject to the 7 48 requirements of chapter 17A. However, game specific 7 49 rules shall be made available to the public prior to 7 50 the time the games go on sale and shall be kept on 8 1 file at the office of the authority. 8 2 5. Perform such other functions as specified by 8 3 this chapter. 8 4 Sec. . NEW SECTION. 99G.10 AUTHORITY 8 5 PERSONNEL. 8 6 1. All employees of the authority shall be 8 7 considered public employees. 8 8 2. Subject to the approval of the board, the chief 8 9 executive officer shall have the sole power to 8 10 designate particular employees as key personnel, but 8 11 may take advice from the department of personnel in 8 12 making any such designations. All key personnel shall 8 13 be exempt from the merit system described in chapter 8 14 19A. The chief executive officer and the board shall 8 15 have the sole power to employ, classify, and fix the 8 16 compensation of key personnel. All other employees 8 17 shall be employed, classified, and compensated in 8 18 accordance with chapters 19A and 20. 8 19 3. The chief executive officer and the board shall 8 20 have the exclusive power to determine the number of 8 21 full-time equivalent positions, as defined in chapter 8 22 8, necessary to carry out the provisions of this 8 23 chapter. 8 24 4. The chief executive officer shall have the sole 8 25 responsibility to assign duties to all authority 8 26 employees. 8 27 5. The authority may establish incentive programs 8 28 for authority employees. 8 29 6. An employee of the authority shall not have a 8 30 financial interest in any vendor doing business or 8 31 proposing to do business with the authority. However, 8 32 an employee may own shares of a mutual fund which may 8 33 hold shares of a vendor corporation provided the 8 34 employee does not have the ability to influence the 8 35 investment functions of the mutual fund. 8 36 7. An employee of the authority with decision- 8 37 making authority shall not participate in any decision 8 38 involving a retailer with whom the employee has a 8 39 financial interest. 8 40 8. A background investigation shall be conducted 8 41 by the department of public safety, division of 8 42 criminal investigation, on each applicant who has 8 43 reached the final selection process prior to 8 44 employment by the authority. For positions not 8 45 designated as sensitive by the board, the 8 46 investigation may consist of a state criminal history 8 47 background check, work history, and financial review. 8 48 The board shall identify those sensitive positions of 8 49 the authority which require full background 8 50 investigations, which positions shall include, at a 9 1 minimum, any officer of the authority, and any 9 2 employee with operational management responsibilities, 9 3 security duties, or system maintenance or programming 9 4 responsibilities related to the authority's data 9 5 processing or network hardware, software, 9 6 communication, or related systems. In addition to a 9 7 work history and financial review, a full background 9 8 investigation may include a national criminal history 9 9 record check through the federal bureau of 9 10 investigation. The screening of employees through the 9 11 federal bureau of investigation shall be conducted by 9 12 submission of fingerprints through the state criminal 9 13 history record repository to the federal bureau of 9 14 investigation. The results of background 9 15 investigations conducted pursuant to this section 9 16 shall not be considered public records under chapter 9 17 22. 9 18 9. A person who has been convicted of a felony or 9 19 bookmaking or other form of illegal gambling or of a 9 20 crime involving moral turpitude shall not be employed 9 21 by the authority. 9 22 10. The authority shall bond authority employees 9 23 with access to authority funds or lottery revenue in 9 24 such an amount as provided by the board and may bond 9 25 other employees as deemed necessary. 9 26 Sec. . NEW SECTION. 99G.11 CONFLICTS OF 9 27 INTEREST. 9 28 1. A member of the board, any officer, or other 9 29 employee of the authority shall not directly or 9 30 indirectly, individually, as a member of a partnership 9 31 or other association, or as a shareholder, director, 9 32 or officer of a corporation have an interest in a 9 33 business that contracts for the operation or marketing 9 34 of the lottery as authorized by this chapter, unless 9 35 the business is controlled or operated by a consortium 9 36 of lotteries in which the authority has an interest. 9 37 2. Notwithstanding the provisions of chapter 68B, 9 38 a person contracting or seeking to contract with the 9 39 state to supply gaming equipment or materials for use 9 40 in the operation of the lottery, an applicant for a 9 41 license to sell tickets or shares in the lottery, or a 9 42 retailer shall not offer a member of the board, any 9 43 officer, or other employee of the authority, or a 9 44 member of their immediate family a gift, gratuity, or 9 45 other thing having a value of more than the limits 9 46 established in chapter 68B, other than food and 9 47 beverage consumed at a meal. For purposes of this 9 48 subsection, "member of their immediate family" means a 9 49 spouse, child, stepchild, brother, brother-in-law, 9 50 stepbrother, sister, sister-in-law, stepsister, 10 1 parent, parent-in-law, or step-parent of the board 10 2 member, the officer, or other employee who resides in 10 3 the same household in the same principal residence of 10 4 the board member, officer, or other employee. 10 5 3. If a board member, officer, or other employee 10 6 of the authority violates a provision of this section, 10 7 the board member, officer, or employee shall be 10 8 immediately removed from the office or position. 10 9 4. Enforcement of this section against a board 10 10 member, officer, or other employee shall be by the 10 11 attorney general who upon finding a violation shall 10 12 initiate an action to remove the board member, 10 13 officer, or employee. 10 14 5. A violation of this section is a serious 10 15 misdemeanor. 10 16 Sec. . NEW SECTION. 99G.21 AUTHORITY POWERS, 10 17 TRANSFER OF ASSETS, LIABILITIES, AND OBLIGATIONS. 10 18 1. Funds of the state shall not be used or 10 19 obligated to pay the expenses or prizes of the 10 20 authority. 10 21 2. The authority shall have any and all powers 10 22 necessary or convenient to carry out and effectuate 10 23 the purposes and provisions of this chapter which are 10 24 not in conflict with the Constitution of this state, 10 25 including, but without limiting the generality of the 10 26 foregoing, the following powers: 10 27 a. To sue and be sued and to complain and defend 10 28 in all courts. 10 29 b. To adopt and alter a seal. 10 30 c. To procure or to provide insurance. 10 31 d. To hold copyrights, trademarks, and service 10 32 marks and enforce its rights with respect thereto. 10 33 e. To initiate, supervise, and administer the 10 34 operation of the lottery in accordance with the 10 35 provisions of this chapter and administrative rules, 10 36 policies, and procedures adopted pursuant thereto. 10 37 f. To enter into written agreements with one or 10 38 more other states or territories of the United States, 10 39 or one or more political subdivisions of another state 10 40 or territory of the United States, or any entity 10 41 lawfully operating a lottery outside the United States 10 42 for the operation, marketing, and promotion of a joint 10 43 lottery or joint lottery game. For the purposes of 10 44 this subsection, any lottery with which the authority 10 45 reaches an agreement or compact shall meet the 10 46 criteria for security, integrity, and finance set by 10 47 the board. 10 48 g. To conduct such market research as is necessary 10 49 or appropriate, which may include an analysis of the 10 50 demographic characteristics of the players of each 11 1 lottery game, and an analysis of advertising, 11 2 promotion, public relations, incentives, and other 11 3 aspects of communication. 11 4 h. Subject to the provisions of subsection 3, to 11 5 acquire or lease real property and make improvements 11 6 thereon and acquire by lease or by purchase, personal 11 7 property, including, but not limited to, computers; 11 8 mechanical, electronic, and on-line equipment and 11 9 terminals; and intangible property, including, but not 11 10 limited to, computer programs, systems, and software. 11 11 i. Subject to the provisions of subsection 3, to 11 12 enter into contracts to incur debt in its own name and 11 13 enter into financing agreements with the state, 11 14 agencies or instrumentalities of the state, or with 11 15 any commercial bank or credit provider. 11 16 j. To select and contract with vendors and 11 17 retailers. 11 18 k. To enter into contracts or agreements with 11 19 state or local law enforcement agencies for the 11 20 performance of law enforcement, background 11 21 investigations, and security checks. 11 22 l. To enter into contracts of any and all types on 11 23 such terms and conditions as the authority may 11 24 determine necessary. 11 25 m. To establish and maintain banking 11 26 relationships, including, but not limited to, 11 27 establishment of checking and savings accounts and 11 28 lines of credit. 11 29 n. To advertise and promote the lottery and 11 30 lottery games. 11 31 o. To act as a retailer, to conduct promotions 11 32 which involve the dispensing of lottery tickets or 11 33 shares, and to establish and operate a sales facility 11 34 to sell lottery tickets or shares and any related 11 35 merchandise. 11 36 p. Notwithstanding any other provision of law to 11 37 the contrary, to purchase meals for attendees at 11 38 authority business meetings. 11 39 q. To exercise all powers generally exercised by 11 40 private businesses engaged in entrepreneurial 11 41 pursuits, unless the exercise of such a power would 11 42 violate the terms of this chapter or of the 11 43 Constitution of this state. 11 44 3. Notwithstanding any other provision of law, any 11 45 purchase of real property and any borrowing of more 11 46 than one million dollars by the authority shall 11 47 require written notice from the authority to the 11 48 legislative government oversight committees and the 11 49 prior approval of the executive council. 11 50 4. The powers enumerated in this section are 12 1 cumulative of and in addition to those powers 12 2 enumerated elsewhere in this chapter and no such 12 3 powers limit or restrict any other powers of the 12 4 authority. 12 5 5. Departments, boards, commissions, or other 12 6 agencies of this state shall provide reasonable 12 7 assistance and services to the authority upon the 12 8 request of the chief executive officer. 12 9 Sec. . NEW SECTION. 99G.22 VENDOR BACKGROUND 12 10 REVIEW. 12 11 1. The authority shall investigate the financial 12 12 responsibility, security, and integrity of any lottery 12 13 system vendor who is a finalist in submitting a bid, 12 14 proposal, or offer as part of a major procurement 12 15 contract. Before a major procurement contract is 12 16 awarded, the division of criminal investigation of the 12 17 department of public safety shall conduct a background 12 18 investigation of the vendor to whom the contract is to 12 19 be awarded. The chief executive officer and board 12 20 shall consult with the division of criminal 12 21 investigation and shall provide for the scope of the 12 22 background investigation and due diligence to be 12 23 conducted in connection with major procurement 12 24 contracts. At the time of submitting a bid, proposal, 12 25 or offer to the authority on a major procurement 12 26 contract, the authority shall require that each vendor 12 27 submit to the division of criminal investigation 12 28 appropriate investigation authorization to facilitate 12 29 this investigation, together with an advance of funds 12 30 to meet the anticipated investigation costs. If the 12 31 division of criminal investigation determines that 12 32 additional funds are required to complete an 12 33 investigation, the vendor will be so advised. The 12 34 background investigation by the division of criminal 12 35 investigation may include a national criminal history 12 36 record check through the federal bureau of 12 37 investigation. The screening of vendors or their 12 38 employees through the federal bureau of investigation 12 39 shall be conducted by submission of fingerprints 12 40 through the state criminal history record repository 12 41 to the federal bureau of investigation. 12 42 2. If at least twenty-five percent of the cost of 12 43 a vendor's contract is subcontracted, the vendor shall 12 44 disclose all of the information required by this 12 45 section for the subcontractor as if the subcontractor 12 46 were itself a vendor. 12 47 3. A major procurement contract shall not be 12 48 entered into with any lottery system vendor who has 12 49 not complied with the disclosure requirements 12 50 described in this section, and any contract with such 13 1 a vendor is voidable at the option of the authority. 13 2 Any contract with a vendor that does not comply with 13 3 the requirements for periodically updating such 13 4 disclosures during the tenure of the contract as may 13 5 be specified in such contract may be terminated by the 13 6 authority. The provisions of this section shall be 13 7 construed broadly and liberally to achieve the ends of 13 8 full disclosure of all information necessary to allow 13 9 for a full and complete evaluation by the authority of 13 10 the competence, integrity, background, and character 13 11 of vendors for major procurements. 13 12 4. A major procurement contract shall not be 13 13 entered into with any vendor who has been found guilty 13 14 of a felony related to the security or integrity of 13 15 the lottery in this or any other jurisdiction. 13 16 5. A major procurement contract shall not be 13 17 entered into with any vendor if such vendor has an 13 18 ownership interest in an entity that had supplied 13 19 consultation services under contract to the authority 13 20 regarding the request for proposals pertaining to 13 21 those particular goods or services. 13 22 6. If, based on the results of a background 13 23 investigation, the board determines that the best 13 24 interests of the authority, including but not limited 13 25 to the authority's reputation for integrity, would be 13 26 served thereby, the board may disqualify a potential 13 27 vendor from contracting with the authority for a major 13 28 procurement contract or from acting as a subcontractor 13 29 in connection with a contract for a major procurement 13 30 contract. 13 31 Sec. . NEW SECTION. 99G.23 VENDOR BONDING, 13 32 TAX FILING, AND COMPETITIVE BIDDING. 13 33 1. The authority may purchase, lease, or lease- 13 34 purchase such goods or services as are necessary for 13 35 effectuating the purposes of this chapter. The 13 36 authority may make procurements that integrate 13 37 functions such as lottery game design, lottery ticket 13 38 distribution to retailers, supply of goods and 13 39 services, and advertising. In all procurement 13 40 decisions, the authority shall take into account the 13 41 particularly sensitive nature of the lottery and shall 13 42 act to promote and ensure security, honesty, fairness, 13 43 and integrity in the operation and administration of 13 44 the lottery and the objectives of raising net proceeds 13 45 for state programs. 13 46 2. Each vendor shall, at the execution of the 13 47 contract with the authority, post a performance bond 13 48 or letter of credit from a bank or credit provider 13 49 acceptable to the authority in an amount as deemed 13 50 necessary by the authority for that particular bid or 14 1 contract. 14 2 3. Each vendor shall be qualified to do business 14 3 in this state and shall file appropriate tax returns 14 4 as provided by the laws of this state. 14 5 4. All major procurement contracts must be 14 6 competitively bid pursuant to policies and procedures 14 7 approved by the board unless there is only one 14 8 qualified vendor and that vendor has an exclusive 14 9 right to offer the service or product. 14 10 Sec. . NEW SECTION. 99G.24 RETAILER 14 11 COMPENSATION LICENSING. 14 12 1. The general assembly recognizes that to conduct 14 13 a successful lottery, the authority must develop and 14 14 maintain a statewide network of lottery retailers that 14 15 will serve the public convenience and promote the sale 14 16 of tickets or shares and the playing of lottery games 14 17 while ensuring the integrity of the lottery 14 18 operations, games, and activities. 14 19 2. The board shall determine the compensation to 14 20 be paid to licensed retailers. Compensation may 14 21 include provision for variable payments based on sales 14 22 volume or incentive considerations. 14 23 3. The authority shall issue a license certificate 14 24 to each person with whom it contracts as a retailer 14 25 for purposes of display as provided in this section. 14 26 Every lottery retailer shall post its license 14 27 certificate, or a facsimile thereof, and keep it 14 28 conspicuously displayed in a location on the premises 14 29 accessible to the public. No license shall be 14 30 assignable or transferable. Once issued, a license 14 31 shall remain in effect until canceled, suspended, or 14 32 terminated by the authority. 14 33 4. A licensee shall cooperate with the authority 14 34 by using point-of-purchase materials, posters, and 14 35 other marketing material when requested to do so by 14 36 the authority. Lack of cooperation is sufficient 14 37 cause for revocation of a retailer's license. 14 38 5. The board shall develop a list of objective 14 39 criteria upon which the qualification of lottery 14 40 retailers shall be based. Separate criteria shall be 14 41 developed to govern the selection of retailers of 14 42 instant tickets and online retailers. In developing 14 43 these criteria, the board shall consider such factors 14 44 as the applicant's financial responsibility, security 14 45 of the applicant's place of business or activity, 14 46 accessibility to the public, integrity, and 14 47 reputation. The criteria shall include but not be 14 48 limited to the volume of expected sales and the 14 49 sufficiency of existing licensees to serve the public 14 50 convenience. 15 1 6. The applicant shall be current in filing all 15 2 applicable tax returns to the state of Iowa and in 15 3 payment of all taxes, interest, and penalties owed to 15 4 the state of Iowa, excluding items under formal appeal 15 5 pursuant to applicable statutes. The department of 15 6 revenue and finance is authorized and directed to 15 7 provide this information to the authority. 15 8 7. A person, partnership, unincorporated 15 9 association, authority, or other business entity shall 15 10 not be selected as a lottery retailer if the person or 15 11 entity meets any of the following conditions: 15 12 a. Has been convicted of a criminal offense 15 13 related to the security or integrity of the lottery in 15 14 this or any other jurisdiction. 15 15 b. Has been convicted of any illegal gambling 15 16 activity, false statements, perjury, fraud, or a 15 17 felony in this or any other jurisdiction. 15 18 c. Has been found to have violated the provisions 15 19 of this chapter or any regulation, policy, or 15 20 procedure of the authority or of the lottery division 15 21 unless either ten years have passed since the 15 22 violation or the board finds the violation both minor 15 23 and unintentional in nature. 15 24 d. Is a vendor or any employee or agent of any 15 25 vendor doing business with the authority. 15 26 e. Resides in the same household as an officer of 15 27 the authority. 15 28 f. Is less than eighteen years of age. 15 29 g. Does not demonstrate financial responsibility 15 30 sufficient to adequately meet the requirements of the 15 31 proposed enterprise. 15 32 h. Has not demonstrated that the applicant is the 15 33 true owner of the business proposed to be licensed and 15 34 that all persons holding at least a ten percent 15 35 ownership interest in the applicant's business have 15 36 been disclosed. 15 37 i. Has knowingly made a false statement of 15 38 material fact to the authority. 15 39 8. Persons applying to become lottery retailers 15 40 may be charged a uniform application fee for each 15 41 lottery outlet. 15 42 9. Any lottery retailer contract executed pursuant 15 43 to this section may, for good cause, be suspended, 15 44 revoked, or terminated by the chief executive officer 15 45 or the chief executive officer's designee if the 15 46 retailer is found to have violated any provision of 15 47 this chapter or objective criteria established by the 15 48 board. Cause for suspension, revocation, or 15 49 termination may include, but is not limited to, sale 15 50 of tickets or shares to a person under the age of 16 1 twenty-one and failure to pay for lottery products in 16 2 a timely manner. 16 3 Sec. . NEW SECTION. 99G.25 LICENSE NOT 16 4 ASSIGNABLE. 16 5 Any lottery retailer license certificate or 16 6 contract shall not be transferable or assignable. The 16 7 authority may issue a temporary license when deemed in 16 8 the best interests of the state. A lottery retailer 16 9 shall not contract with any person for lottery goods 16 10 or services, except with the approval of the board. 16 11 Sec. . NEW SECTION. 99G.26 RETAILER BONDING. 16 12 The authority may require any retailer to post an 16 13 appropriate bond, as determined by the authority, 16 14 using a cash bond or an insurance company acceptable 16 15 to the authority. 16 16 Sec. . NEW SECTION. 99G.27 LOTTERY RETAIL 16 17 LICENSES CANCELLATION, SUSPENSION, REVOCATION, OR 16 18 TERMINATION. 16 19 1. A lottery retail license issued by the 16 20 authority pursuant to this chapter may be canceled, 16 21 suspended, revoked, or terminated by the authority, 16 22 for reasons including, but not limited to, any of the 16 23 following: 16 24 a. A violation of this chapter, a regulation, or a 16 25 policy or procedure of the authority. 16 26 b. Failure to accurately or timely account or pay 16 27 for lottery products, lottery games, revenues, or 16 28 prizes as required by the authority. 16 29 c. Commission of any fraud, deceit, or 16 30 misrepresentation. 16 31 d. Insufficient sales. 16 32 e. Conduct prejudicial to public confidence in the 16 33 lottery. 16 34 f. The retailer filing for or being placed in 16 35 bankruptcy or receivership. 16 36 g. Any material change as determined in the sole 16 37 discretion of the authority in any matter considered 16 38 by the authority in executing the contract with the 16 39 retailer. 16 40 h. Failure to meet any of the objective criteria 16 41 established by the authority pursuant to this chapter. 16 42 i. Other conduct likely to result in injury to the 16 43 property, revenue, or reputation of the authority. 16 44 2. A lottery retailer license may be temporarily 16 45 suspended by the authority without prior notice if the 16 46 chief executive officer or designee determines that 16 47 further sales by the licensed retailer are likely to 16 48 result in immediate injury to the property, revenue, 16 49 or reputation of the authority. 16 50 3. The board shall adopt administrative rules 17 1 governing appeals of lottery retailer licensing 17 2 disputes. 17 3 Sec. . NEW SECTION. 99G.28 PROCEEDS HELD IN 17 4 TRUST. 17 5 All proceeds from the sale of the lottery tickets 17 6 or shares shall constitute a trust fund until paid to 17 7 the authority directly, through electronic funds 17 8 transfer to the authority, or through the authority's 17 9 authorized collection representative. A lottery 17 10 retailer and officers of a lottery retailer's business 17 11 shall have a fiduciary duty to preserve and account 17 12 for lottery proceeds and lottery retailers shall be 17 13 personally liable for all proceeds. Proceeds shall 17 14 include unsold products received but not paid for by a 17 15 lottery retailer and cash proceeds of the sale of any 17 16 lottery products net of allowable sales commissions 17 17 and credit for lottery prizes paid to winners by 17 18 lottery retailers. Sales proceeds of pull-tab tickets 17 19 shall include the sales price of the lottery product 17 20 net of allowable sales commission and prizes contained 17 21 in the product. Sales proceeds and unused instant 17 22 tickets shall be delivered to the authority or its 17 23 authorized collection representative upon demand. 17 24 Sec. . NEW SECTION. 99G.29 RETAILER RENTAL 17 25 CALCULATIONS LOTTERY TICKET SALES TREATMENT. 17 26 If a lottery retailer's rental payments for the 17 27 business premises are contractually computed, in whole 17 28 or in part, on the basis of a percentage of retail 17 29 sales and such computation of retail sales is not 17 30 explicitly defined to include sales of tickets or 17 31 shares in a state-operated or state-managed lottery, 17 32 only the compensation received by the lottery retailer 17 33 from the authority may be considered the amount of the 17 34 lottery retail sale for purposes of computing the 17 35 rental payment. 17 36 Sec. . NEW SECTION. 99G.30 TICKET SALES 17 37 REQUIREMENTS PENALTIES. 17 38 1. Lottery tickets or shares may be distributed by 17 39 the authority for promotional purposes. 17 40 2. A ticket or share shall not be sold at a price 17 41 other than that fixed by the authority and a sale 17 42 shall not be made other than by a retailer or an 17 43 employee of the retailer who is authorized by the 17 44 retailer to sell tickets or shares. A person who 17 45 violates a provision of this subsection is guilty of a 17 46 simple misdemeanor. 17 47 3. A ticket or share shall not be sold to a person 17 48 who has not reached the age of twenty-one. Any person 17 49 who knowingly sells a lottery ticket or share to a 17 50 person under the age of twenty-one shall be guilty of 18 1 a simple misdemeanor. It shall be an affirmative 18 2 defense to a charge of a violation under this section 18 3 that the retailer reasonably and in good faith relied 18 4 upon presentation of proof of age in making the sale. 18 5 A prize won by a person who has not reached the age of 18 6 twenty-one but who purchases a winning ticket or share 18 7 in violation of this subsection shall be forfeited. 18 8 This section does not prohibit the lawful purchase of 18 9 a ticket or share for the purpose of making a gift to 18 10 a person who has not reached the age of twenty-one. 18 11 The board shall adopt administrative rules governing 18 12 the payment of prizes to persons who have not reached 18 13 the age of twenty-one. 18 14 4. Except for the authority, a retailer shall only 18 15 sell lottery products on the licensed premises and not 18 16 through the mail or by technological means except as 18 17 the authority may provide or authorize. 18 18 5. The retailer may accept payment by cash, check, 18 19 money order, debit card, or electronic funds transfer. 18 20 The retailer shall not extend or arrange credit for 18 21 the purchase of a ticket or share. As used in this 18 22 subsection, "cash" means United States currency. 18 23 6. Nothing in this chapter shall be construed to 18 24 prohibit the authority from designating certain of its 18 25 agents and employees to sell or give lottery tickets 18 26 or shares directly to the public. 18 27 7. No elected official's name shall be printed on 18 28 tickets. 18 29 Sec. . NEW SECTION. 99G.31 PRIZES. 18 30 1. The chief executive officer shall award the 18 31 designated prize to the ticket or shareholder upon 18 32 presentation of the winning ticket or confirmation of 18 33 a winning share. The prize shall be given to only one 18 34 person; however, a prize shall be divided between 18 35 holders of winning tickets if there is more than one 18 36 winning ticket. 18 37 2. The authority shall adopt administrative rules, 18 38 policies, and procedures to establish a system of 18 39 verifying the validity of tickets or shares claimed to 18 40 win prizes and to effect payment of such prizes, 18 41 subject to the following requirements: 18 42 a. The prize shall be given to the person who 18 43 presents a winning ticket. A prize may be given to 18 44 only one person per winning ticket. However, a prize 18 45 shall be divided between holders of winning tickets if 18 46 there is more than one winning ticket. Payment of a 18 47 prize may be made to the estate of a deceased prize 18 48 winner or to another person pursuant to an appropriate 18 49 judicial order issued by an Iowa court of competent 18 50 jurisdiction. 19 1 b. A prize shall not be paid arising from claimed 19 2 tickets that are stolen, counterfeit, altered, 19 3 fraudulent, unissued, produced or issued in error, 19 4 unreadable, not received, or not recorded by the 19 5 authority within applicable deadlines; lacking in 19 6 captions that conform and agree with the play symbols 19 7 as appropriate to the particular lottery game 19 8 involved; or not in compliance with such additional 19 9 specific administrative rules, policies, and public or 19 10 confidential validation and security tests of the 19 11 authority appropriate to the particular lottery game 19 12 involved. 19 13 c. No particular prize in any lottery game shall 19 14 be paid more than once, and in the event of a 19 15 determination that more than one claimant is entitled 19 16 to a particular prize, the sole remedy of such 19 17 claimants is the award to each of them of an equal 19 18 share in the prize. 19 19 d. Unclaimed prize money for the prize on a 19 20 winning ticket or share shall be retained for a period 19 21 deemed appropriate by the chief executive officer, 19 22 subject to approval by the board. If a valid claim is 19 23 not made for the money within the applicable period, 19 24 the unclaimed prize money shall be added to the pool 19 25 from which future prizes are to be awarded or used for 19 26 special prize promotions. Notwithstanding this 19 27 subsection, the disposition of unclaimed prize money 19 28 from multijurisdictional games shall be made in 19 29 accordance with the rules of the multijurisdictional 19 30 game. 19 31 e. No prize shall be paid upon a ticket or share 19 32 purchased or sold in violation of this chapter. Any 19 33 such prize shall constitute an unclaimed prize for 19 34 purposes of this section. 19 35 f. The authority is discharged of all liability 19 36 upon payment of a prize pursuant to this section. 19 37 g. No ticket or share issued by the authority 19 38 shall be purchased by and no prize shall be paid to 19 39 any member of the board of directors; any officer or 19 40 employee of the authority; or to any spouse, child, 19 41 brother, sister, or parent residing as a member of the 19 42 same household in the principal place of residence of 19 43 any such person. 19 44 h. No ticket or share issued by the authority 19 45 shall be purchased by and no prize shall be paid to 19 46 any officer, employee, agent, or subcontractor of any 19 47 vendor or to any spouse, child, brother, sister, or 19 48 parent residing as a member of the same household in 19 49 the principal place of residence of any such person if 19 50 such officer, employee, agent, or subcontractor has 20 1 access to confidential information which may 20 2 compromise the integrity of the lottery. 20 3 i. The proceeds of any lottery prize shall be 20 4 subject to state and federal income tax laws. An 20 5 amount deducted from the prize for payment of a state 20 6 tax, pursuant to section 422.16, subsection 1, shall 20 7 be transferred by the authority to the department of 20 8 revenue and finance on behalf of the prize winner. 20 9 Sec. . NEW SECTION. 99G.32 AUTHORITY LEGAL 20 10 REPRESENTATION. 20 11 The authority shall retain the services of legal 20 12 counsel to advise the authority and the board and to 20 13 provide representation in legal proceedings. The 20 14 authority may retain the attorney general or a full- 20 15 time assistant attorney general in that capacity and 20 16 provide reimbursement for the cost of advising and 20 17 representing the board and the authority. 20 18 Sec. . NEW SECTION. 99G.33 LAW ENFORCEMENT 20 19 INVESTIGATIONS. 20 20 The department of public safety, division of 20 21 criminal investigation, shall be the primary state 20 22 agency responsible for investigating criminal 20 23 violations under this chapter. The chief executive 20 24 officer shall contract with the department of public 20 25 safety for investigative services, including the 20 26 employment of special agents and support personnel, 20 27 and procurement of necessary equipment to carry out 20 28 the responsibilities of the division of criminal 20 29 investigation under the terms of the agreement and 20 30 this chapter. 20 31 Sec. . NEW SECTION. 99G.34 OPEN RECORDS 20 32 EXCEPTIONS. 20 33 The records of the authority shall be governed by 20 34 the provisions of chapter 22, provided that, in 20 35 addition to records that may be kept confidential 20 36 pursuant to section 22.7, the following records shall 20 37 be kept confidential, unless otherwise ordered by a 20 38 court, by the lawful custodian of the records, or by 20 39 another person duly authorized to release such 20 40 information: 20 41 1. Marketing plans, research data, and proprietary 20 42 intellectual property owned or held by the authority 20 43 under contractual agreements. 20 44 2. Personnel, vendor, and player social security 20 45 or tax identification numbers. 20 46 3. Computer system hardware, software, functional 20 47 and system specifications, and game play data files. 20 48 4. Security records pertaining to investigations 20 49 and intelligence-sharing information between lottery 20 50 security officers and those of other lotteries and law 21 1 enforcement agencies, the security portions or 21 2 segments of lottery requests for proposals, proposals 21 3 by vendors to conduct lottery operations, and records 21 4 of the security division of the authority pertaining 21 5 to game security data, ticket validation tests, and 21 6 processes. 21 7 5. Player name and address lists, provided that 21 8 the names and addresses of prize winners shall not be 21 9 withheld. 21 10 6. Operational security measures, systems, or 21 11 procedures and building plans. 21 12 7. Security reports and other information 21 13 concerning bids or other contractual data, the 21 14 disclosure of which would impair the efforts of the 21 15 authority to contract for goods or services on 21 16 favorable terms. 21 17 8. Information that is otherwise confidential 21 18 obtained pursuant to investigations. 21 19 Sec. . NEW SECTION. 99G.35 SECURITY. 21 20 1. The authority's chief security officer and 21 21 investigators shall be qualified by training and 21 22 experience in law enforcement to perform their 21 23 respective duties in support of the activities of the 21 24 security office. The chief security officer and 21 25 investigators shall not have sworn peace officer 21 26 status. The lottery security office shall perform all 21 27 of the following activities in support of the 21 28 authority mission: 21 29 a. Supervise ticket or share validation and 21 30 lottery drawings, provided that the authority may 21 31 enter into cooperative agreements with 21 32 multijurisdictional lottery administrators for shared 21 33 security services at drawings and game show events 21 34 involving more than one participating lottery. 21 35 b. Inspect at times determined solely by the 21 36 authority the facilities of any vendor or lottery 21 37 retailer in order to determine the integrity of the 21 38 vendor's product or the operations of the retailer in 21 39 order to determine whether the vendor or the retailer 21 40 is in compliance with its contract. 21 41 c. Report any suspected violations of this chapter 21 42 to the appropriate county attorney or the attorney 21 43 general and to any law enforcement agencies having 21 44 jurisdiction over the violation. 21 45 d. Upon request, provide assistance to any county 21 46 attorney, the attorney general, the department of 21 47 public safety, or any other law enforcement agency. 21 48 e. Upon request, provide assistance to retailers 21 49 in meeting their licensing contract requirements and 21 50 in detecting retailer employee theft. 22 1 f. Monitor authority operations for compliance 22 2 with internal security requirements. 22 3 g. Provide physical security at the authority's 22 4 central operations facilities. 22 5 h. Conduct on-press product production 22 6 surveillance, testing, and quality approval for 22 7 printed scratch and pull-tab tickets. 22 8 i. Coordinate employee and retailer background 22 9 investigations conducted by the department of public 22 10 safety, division of criminal investigation. 22 11 2. The authority may enter into intelligence- 22 12 sharing, reciprocal use, or restricted use agreements 22 13 with the federal government, law enforcement agencies, 22 14 lottery regulation agencies, and gaming enforcement 22 15 agencies of other jurisdictions which provide for and 22 16 regulate the use of information provided and received 22 17 pursuant to the agreement. 22 18 3. Records, documents, and information in the 22 19 possession of the authority received pursuant to an 22 20 intelligence-sharing, reciprocal use, or restricted 22 21 use agreement entered into by the authority with a 22 22 federal department or agency, any law enforcement 22 23 agency, or the lottery regulation or gaming 22 24 enforcement agency of any jurisdiction shall be 22 25 considered investigative records of a law enforcement 22 26 agency and are not subject to chapter 22 and shall not 22 27 be released under any condition without the permission 22 28 of the person or agency providing the record or 22 29 information. 22 30 Sec. . NEW SECTION. 99G.36 FORGERY FRAUD 22 31 PENALTIES. 22 32 1. A person who, with intent to defraud, falsely 22 33 makes, alters, forges, utters, passes, redeems, or 22 34 counterfeits a lottery ticket or share or attempts to 22 35 falsely make, alter, forge, utter, pass, redeem, or 22 36 counterfeit a lottery ticket or share, or commits 22 37 theft or attempts to commit theft of a lottery ticket 22 38 or share, is guilty of a class "D" felony. 22 39 2. Any person who influences or attempts to 22 40 influence the winning of a prize through the use of 22 41 coercion, fraud, deception, or tampering with lottery 22 42 equipment or materials shall be guilty of a class "D" 22 43 felony. 22 44 3. No person shall knowingly or intentionally make 22 45 a material false statement in any application for a 22 46 license or proposal to conduct lottery activities or 22 47 make a material false entry in any book or record 22 48 which is compiled or maintained or submitted to the 22 49 board pursuant to the provisions of this chapter. Any 22 50 person who violates the provisions of this section 23 1 shall be guilty of a class "D" felony. 23 2 Sec. . NEW SECTION. 99G.37 COMPETITIVE 23 3 BIDDING. 23 4 1. The authority shall enter into a major 23 5 procurement contract pursuant to competitive bidding. 23 6 The requirement for competitive bidding does not apply 23 7 in the case of a single vendor having exclusive rights 23 8 to offer a particular service or product. The board 23 9 shall adopt procedures for competitive bidding. 23 10 Procedures adopted by the board shall be designed to 23 11 allow the selection of proposals that provide the 23 12 greatest long-term benefit to the state, the greatest 23 13 integrity for the authority, and the best service and 23 14 products for the public. 23 15 2. In any bidding process, the authority may 23 16 administer its own bidding and procurement or may 23 17 utilize the services of the department of general 23 18 services, or its successor, or other state agency. 23 19 Sec. . NEW SECTION. 99G.38 AUTHORITY FINANCE 23 20 SELF-SUSTAINING. 23 21 1. The authority may borrow, or accept and expend, 23 22 in accordance with the provisions of this chapter, 23 23 such moneys as may be received from any source, 23 24 including income from the authority's operations, for 23 25 effectuating its business purposes, including the 23 26 payment of the initial expenses of initiation, 23 27 administration, and operation of the authority and the 23 28 lottery. 23 29 2. The authority shall be self-sustaining and 23 30 self-funded. Moneys in the general fund of the state 23 31 shall not be used or obligated to pay the expenses of 23 32 the authority or prizes of the lottery, and no claim 23 33 for the payment of an expense of the lottery or prizes 23 34 of the lottery may be made against any moneys other 23 35 than moneys credited to the authority operating 23 36 account. 23 37 3. The state of Iowa offset program, as provided 23 38 in section 421.17, shall be available to the authority 23 39 to facilitate receipt of funds owed to the authority. 23 40 Sec. . NEW SECTION. 99G.39 ALLOCATION, 23 41 APPROPRIATION, TRANSFER, AND REPORTING OF FUNDS. 23 42 1. Upon receipt of any revenue, the chief 23 43 executive officer shall deposit the moneys in the 23 44 lottery fund created pursuant to section 99G.40. At 23 45 least fifty percent of the projected annual revenue 23 46 accruing from the sale of tickets or shares shall be 23 47 allocated for payment of prizes to the holders of 23 48 winning tickets. After the payment of prizes, the 23 49 following shall be deducted from the authority's 23 50 revenue prior to disbursement: 24 1 a. An amount equal to three-tenths of one percent 24 2 of the gross lottery revenue for the year shall be 24 3 deposited in a gambling treatment fund in the office 24 4 of the treasurer of state. 24 5 b. The expenses of conducting the lottery. 24 6 Expenses for advertising production and media 24 7 purchases shall not exceed four percent of the 24 8 authority's gross revenue for the year. 24 9 2. The director of management shall not include 24 10 lottery revenues in the director's fiscal year revenue 24 11 estimates. 24 12 3. a. Notwithstanding subsection 1, if gaming 24 13 revenues under sections 99D.17 and 99F.11 are 24 14 insufficient in a fiscal year to meet the total amount 24 15 of such revenues directed to be deposited in the 24 16 vision Iowa fund and the school infrastructure fund 24 17 during the fiscal year pursuant to section 8.57, 24 18 subsection 5, paragraph "e", the difference shall be 24 19 paid from lottery revenues prior to deposit of the 24 20 lottery revenues in the general fund. If lottery 24 21 revenues are insufficient during the fiscal year to 24 22 pay the difference, the remaining difference shall be 24 23 paid from lottery revenues in subsequent fiscal years 24 24 as such revenues become available. 24 25 b. The treasurer of state shall, each quarter, 24 26 prepare an estimate of the gaming revenues and lottery 24 27 revenues that will become available during the 24 28 remainder of the appropriate fiscal year for the 24 29 purposes described in paragraph "a". The department 24 30 of management and the department of revenue and 24 31 finance shall take appropriate actions to provide that 24 32 the amount of gaming revenues and lottery revenues 24 33 that will be available during the remainder of the 24 34 appropriate fiscal year is sufficient to cover any 24 35 anticipated deficiencies. 24 36 Sec. . NEW SECTION. 99G.40 AUDITS AND REPORTS 24 37 LOTTERY FUND. 24 38 1. To ensure the financial integrity of the 24 39 lottery, the authority shall do all of the following: 24 40 a. Submit quarterly and annual reports to the 24 41 governor, state auditor, and the general assembly 24 42 disclosing the total lottery revenues, prize 24 43 disbursements, and other expenses of the authority 24 44 during the reporting period. The fourth quarter 24 45 report shall be included in the annual report made 24 46 pursuant to this section. The annual report shall 24 47 include a complete statement of lottery revenues, 24 48 prize disbursements, and other expenses, and 24 49 recommendations for changes in the law that the chief 24 50 executive officer deems necessary or desirable. The 25 1 annual report shall be submitted within one hundred 25 2 twenty days after the close of the fiscal year. The 25 3 chief executive officer shall report immediately to 25 4 the governor, the treasurer of state, and the general 25 5 assembly any matters that require immediate changes in 25 6 the law in order to prevent abuses or evasions of this 25 7 chapter or rules adopted or to rectify undesirable 25 8 conditions in connection with the administration or 25 9 operation of the lottery. 25 10 b. Maintain weekly or more frequent records of 25 11 lottery transactions, including the distribution of 25 12 tickets or shares to retailers, revenues received, 25 13 claims for prizes, prizes paid, prizes forfeited, and 25 14 other financial transactions of the authority. 25 15 c. The authority shall deposit in the lottery fund 25 16 created in subsection 2 any moneys received by 25 17 retailers from the sale of tickets or shares less the 25 18 amount of any compensation due the retailers. The 25 19 chief executive officer may require licensees to file 25 20 with the authority reports of receipts and 25 21 transactions in the sale of tickets or shares. The 25 22 reports shall be in the form and contain the 25 23 information the chief executive officer requires. 25 24 2. A lottery fund is created in the office of the 25 25 treasurer of state and shall exist as the recipient 25 26 fund for authority receipts. The fund consists of all 25 27 revenues received from the sale of lottery tickets or 25 28 shares and all other moneys lawfully credited or 25 29 transferred to the fund. The chief executive officer 25 30 shall certify quarterly that portion of the fund that 25 31 has been transferred to the general fund of the state 25 32 under this chapter and shall cause that portion to be 25 33 transferred to the general fund of the state. 25 34 However, upon the request of the chief executive 25 35 officer and subject to the approval by the treasurer 25 36 of state, an amount sufficient to cover the 25 37 foreseeable administrative expenses of the lottery for 25 38 a period of twenty-one days may be retained from the 25 39 lottery fund. Prior to the quarterly transfer to the 25 40 general fund of the state, the chief executive officer 25 41 may direct that lottery revenue shall be deposited in 25 42 the lottery fund and in interest-bearing accounts 25 43 designated by the treasurer of state. Interest or 25 44 earnings paid on the deposits or investments is 25 45 considered lottery revenue and shall be transferred to 25 46 the general fund of the state in the same manner as 25 47 other lottery revenue. 25 48 3. The chief executive officer shall certify 25 49 before the last day of the month following each 25 50 quarter that portion of the lottery fund resulting 26 1 from the previous quarter's sales to be transferred to 26 2 the general fund of the state. 26 3 4. For informational purposes only, the chief 26 4 executive officer shall submit to the department of 26 5 management by October 1 of each year a proposed 26 6 operating budget for the authority for the succeeding 26 7 fiscal year. This budget proposal shall also be 26 8 accompanied by an estimate of the net proceeds to be 26 9 deposited into the general fund during the succeeding 26 10 fiscal year. This budget shall be on forms prescribed 26 11 by the department of management. 26 12 5. The authority shall adopt the same fiscal year 26 13 as that used by state government and shall be audited 26 14 annually. 26 15 Sec. . NEW SECTION. 99G.41 PRIZE OFFSETS 26 16 GARNISHMENTS. 26 17 1. Any claimant agency may submit to the authority 26 18 a list of the names of all persons indebted to such 26 19 claimant agency or to persons on whose behalf the 26 20 claimant agency is acting. The full amount of the 26 21 debt shall be collectable from any lottery winnings 26 22 due the debtor without regard to limitations on the 26 23 amounts that may be collectable in increments through 26 24 garnishment or other proceedings. Such list shall 26 25 constitute a valid lien upon and claim of lien against 26 26 the lottery winnings of any debtor named in such list. 26 27 The list shall contain the names of the debtors, their 26 28 social security numbers if available, and any other 26 29 information that assists the authority in identifying 26 30 the debtors named in the list. 26 31 2. The authority is authorized and directed to 26 32 withhold any winnings paid out directly by the 26 33 authority subject to the lien created by this section 26 34 and send notice to the winner. However, if the winner 26 35 appears and claims winnings in person, the authority 26 36 shall notify the winner at that time by hand delivery 26 37 of such action. The authority shall pay the funds 26 38 over to the agency administering the offset program. 26 39 3. Notwithstanding the provisions of section 26 40 99G.34 which prohibit disclosure by the authority of 26 41 certain portions of the contents of prize winner 26 42 records or information, and notwithstanding any other 26 43 confidentiality statute, the authority may provide to 26 44 a claimant agency all information necessary to 26 45 accomplish and effectuate the intent of this section. 26 46 4. The information obtained by a claimant agency 26 47 from the authority in accordance with this section 26 48 shall retain its confidentiality and shall only be 26 49 used by a claimant agency in the pursuit of its debt 26 50 collection duties and practices. Any employee or 27 1 prior employee of any claimant agency who unlawfully 27 2 discloses any such information for any other purpose, 27 3 except as otherwise specifically authorized by law, 27 4 shall be subject to the same penalties specified by 27 5 law for unauthorized disclosure of confidential 27 6 information by an agent or employee of the authority. 27 7 5. Except as otherwise provided in this chapter, 27 8 attachments, garnishments, or executions authorized 27 9 and issued pursuant to law shall be withheld if timely 27 10 served upon the authority. 27 11 6. The provisions of this section shall only apply 27 12 to prizes paid directly by the authority and shall not 27 13 apply to any retailers authorized by the board to pay 27 14 prizes of up to six hundred dollars after deducting 27 15 the price of the ticket or share. 27 16 Sec. . NEW SECTION. 99G.42 COMPULSIVE 27 17 GAMBLERS PRINTING ON TICKETS INFORMATION AT 27 18 RETAIL OUTLETS. 27 19 The authority shall cooperate with the gambling 27 20 treatment program administered by the Iowa department 27 21 of public health to incorporate information regarding 27 22 the gambling treatment program and its toll-free 27 23 telephone number in printed materials distributed by 27 24 the authority. 27 25 Sec. . Section 7E.5, subsection 1, paragraph d, 27 26 Code 2003, is amended to read as follows: 27 27 d. The department of revenue and finance, created 27 28 in section 421.2, which has primary responsibility for 27 29 revenue collection and revenue law compliance, and 27 30 financial management and assistance, and the Iowa27 31lottery. 27 32 Sec. . Section 7E.6, subsection 3, Code 2003, 27 33 is amended to read as follows: 27 34 3. Any position of membership on thelotteryboard 27 35 of the Iowa lottery authority shall receive 27 36 compensation of fifty dollars per day and expenses. 27 37 Sec. . Section 8.22A, subsection 5, paragraph 27 38 a, Code 2003, is amended to read as follows: 27 39 a. The amount of lottery revenues for the 27 40 following fiscal year to be available for disbursement 27 41 following the deductions made pursuant to section 27 4299E.1099G.39, subsection 1. 27 43 Sec. . Section 8.57, subsection 5, paragraph e, 27 44 unnumbered paragraph 2, Code 2003, is amended to read 27 45 as follows: 27 46 If the total amount of moneys directed to be 27 47 deposited in the general fund of the state under 27 48 sections 99D.17 and 99F.11 in a fiscal year is less 27 49 than the total amount of moneys directed to be 27 50 deposited in the vision Iowa fund and the school 28 1 infrastructure fund in the fiscal year pursuant to 28 2 this paragraph "e", the difference shall be paid from 28 3 lottery revenues in the manner provided in section 28 499E.1099G.39, subsection 3. 28 5 Sec. . Section 68B.35, subsection 2, paragraph 28 6 e, Code 2003, is amended to read as follows: 28 7 e. Members of the banking board, the ethics and 28 8 campaign disclosure board, the credit union review 28 9 board, the economic development board, the employment 28 10 appeal board, the environmental protection commission, 28 11 the health facilities council, the Iowa finance 28 12 authority, the Iowa public employees' retirement 28 13 system investment board, thelotteryboard of the Iowa 28 14 lottery authority, the natural resource commission, 28 15 the board of parole, the petroleum underground storage 28 16 tank fund board, the public employment relations 28 17 board, the state racing and gaming commission, the 28 18 state board of regents, the tax review board, the 28 19 transportation commission, the office of consumer 28 20 advocate, the utilities board, the Iowa 28 21 telecommunications and technology commission, and any 28 22 full-time members of other boards and commissions as 28 23 defined under section 7E.4 who receive an annual 28 24 salary for their service on the board or commission. 28 25 Sec. . Section 99A.10, Code 2003, is amended to 28 26 read as follows: 28 27 99A.10 MANUFACTURE AND DISTRIBUTION OF GAMBLING 28 28 DEVICES PERMITTED. 28 29 A person may manufacture or act as a distributor 28 30 for gambling devices for sale out of the state in 28 31 another jurisdiction where possession of the device is 28 32 legal or for sale in the state or use in the state if 28 33 the use is permitted pursuant to either chapter 99B or 28 34 chapter99E99G. 28 35 Sec. . Section 99B.1, subsection 17, Code 2003, 28 36 is amended to read as follows: 28 37 17. "Merchandise" includes lottery tickets or 28 38 shares sold or authorized under chapter99E99G. The 28 39 value of the ticket or share is the price of the 28 40 ticket or share as established by the lottery division 28 41 of the department of revenue and finance pursuant to 28 42 chapter99E99G. 28 43 Sec. . Section 99B.6, subsection 5, Code 2003, 28 44 is amended to read as follows: 28 45 5. Lottery tickets or shares authorized pursuant 28 46 to chapter99E99G may be sold on the premises of an 28 47 establishment that serves or sells alcoholic 28 48 beverages, wine, or beer as defined in section 123.3. 28 49 Sec. . Section 99B.7, subsection 1, paragraph 28 50 l, subparagraph (1), Code 2003, is amended to read as 29 1 follows: 29 2 (1) No other gambling is engaged in at the same 29 3 location, except that lottery tickets or shares issued 29 4 by the lottery division of the department of revenue 29 5 and finance may be sold pursuant to chapter99E99G. 29 6 Sec. . Section 99B.15, Code 2003, is amended to 29 7 read as follows: 29 8 99B.15 APPLICABILITY OF CHAPTER PENALTY. 29 9 It is the intent and purpose of this chapter to 29 10 authorize gambling in this state only to the extent 29 11 specifically permitted by a section of this chapter or 29 12 chapter 99D,99E, or99F, or 99G. Except as otherwise 29 13 provided in this chapter, the knowing failure of any 29 14 person to comply with the limitations imposed by this 29 15 chapter constitutes unlawful gambling, a serious 29 16 misdemeanor. 29 17 Sec. . Section 99F.2, Code 2003, is amended to 29 18 read as follows: 29 19 99F.2 SCOPE OF PROVISIONS. 29 20 This chapter does not apply to the pari-mutuel 29 21 system of wagering used or intended to be used in 29 22 connection with the horse-race or dog-race meetings as 29 23 authorized under chapter 99D, lottery or lotto games 29 24 authorized under chapter99E99G, or bingo or games of 29 25 skill or chance authorized under chapter 99B. 29 26 Sec. . Section 99F.11, subsection 3, Code 2003, 29 27 is amended to read as follows: 29 28 3. Three-tenths of one percent of the adjusted 29 29 gross receipts shall be deposited in the gambling 29 30 treatment fund specified in section99E.1099G.39, 29 31 subsection 1, paragraph "a". 29 32 Sec. . Section 123.49, subsection 2, paragraph 29 33 a, Code 2003, is amended to read as follows: 29 34 a. Knowingly permit any gambling, except in 29 35 accordance with chapter 99B, 99D,99E, or99F, or 99G, 29 36 or knowingly permit solicitation for immoral purposes, 29 37 or immoral or disorderly conduct on the premises 29 38 covered by the license or permit. 29 39 Sec. . Section 321.19, subsection 1, unnumbered 29 40 paragraph 2, Code 2003, is amended to read as follows: 29 41 The department shall furnish, on application, free 29 42 of charge, distinguishing plates for vehicles thus 29 43 exempted, which plates except plates on Iowa state 29 44 patrol vehicles shall bear the word "official" and the 29 45 department shall keep a separate record. Registration 29 46 plates issued for Iowa state patrol vehicles, except 29 47 unmarked patrol vehicles, shall bear two red stars on 29 48 a yellow background, one before and one following the 29 49 registration number on the plate, which registration 29 50 number shall be the officer's badge number. 30 1 Registration plates issued for county sheriff's patrol 30 2 vehicles shall display one seven-pointed gold star 30 3 followed by the letter "S" and the call number of the 30 4 vehicle. However, the director of general services or 30 5 the director of transportation may order the issuance 30 6 of regular registration plates for any exempted 30 7 vehicle used by peace officers in the enforcement of 30 8 the law, persons enforcing chapter 124 and other laws 30 9 relating to controlled substances, persons in the 30 10 department of justice, the alcoholic beverages 30 11 division of the department of commerce, disease 30 12 investigators of the Iowa department of public health, 30 13 the department of inspections and appeals, and the 30 14 department of revenue and finance, who are regularly 30 15 assigned to conduct investigations which cannot 30 16 reasonably be conducted with a vehicle displaying 30 17 "official" state registration plates, persons in the 30 18 Iowa lotterydivision of the department of revenue and30 19financeauthority whose regularly assigned duties 30 20 relating to security or the carrying of lottery 30 21 tickets cannot reasonably be conducted with a vehicle 30 22 displaying "official" registration plates, and persons 30 23 in the department of economic development who are 30 24 regularly assigned duties relating to existing 30 25 industry expansion or business attraction. For 30 26 purposes of sale of exempted vehicles, the exempted 30 27 governmental body, upon the sale of the exempted 30 28 vehicle, may issue for in-transit purposes a 30 29 pasteboard card bearing the words "Vehicle in 30 30 Transit", the name of the official body from which the 30 31 vehicle was purchased, together with the date of the 30 32 purchase plainly marked in at least one-inch letters, 30 33 and other information required by the department. The 30 34 in-transit card is valid for use only within forty- 30 35 eight hours after the purchase date as indicated on 30 36 the bill of sale which shall be carried by the driver. 30 37 Sec. . Section 421.17, subsection 27, Code 30 38 2003, is amended by striking the subsection. 30 39 Sec. . Section 422.16, subsection 1, unnumbered 30 40 paragraph 4, Code 2003, is amended to read as follows: 30 41 For the purposes of this subsection, state income 30 42 tax shall be withheld on winnings in excess of six 30 43 hundred dollars derived from gambling activities 30 44 authorized under chapter 99B or99E99G. State income 30 45 tax shall be withheld on winnings in excess of one 30 46 thousand dollars from gambling activities authorized 30 47 under chapter 99D. State income tax shall be withheld 30 48 on winnings in excess of twelve hundred dollars 30 49 derived from slot machines authorized under chapter 30 50 99F. 31 1 Sec. . Section 422.43, subsection 2, Code 2003, 31 2 is amended to read as follows: 31 3 2. There is imposed a tax of five percent upon the 31 4 gross receipts derived from the operation of all forms 31 5 of amusement devices and games of skill, games of 31 6 chance, raffles, and bingo games as defined in chapter 31 7 99B, operated or conducted within the state, the tax 31 8 to be collected from the operator in the same manner 31 9 as for the collection of taxes upon the gross receipts 31 10 of tickets or admission as provided in this section. 31 11The tax shall also be imposed upon the gross receipts31 12derived from the sale of lottery tickets or shares31 13pursuant to chapter 99E. The tax on the lottery31 14tickets or shares shall be included in the sales price31 15and distributed to the general fund as provided in31 16section 99E.10.31 17 Sec. . Section 422B.8, unnumbered paragraph 1, 31 18 Code 2003, is amended to read as follows: 31 19 A local sales and services tax at the rate of not 31 20 more than one percent may be imposed by a county on 31 21 the gross receipts taxed by the state under chapter 31 22 422, division IV. A local sales and services tax 31 23 shall be imposed on the same basis as the state sales 31 24 and services tax or in the case of the use of natural 31 25 gas, natural gas service, electricity, or electric 31 26 service on the same basis as the state use tax and 31 27 shall not be imposed on the sale of any property or on 31 28 any service not taxed by the state, except the tax 31 29 shall not be imposed on the gross receipts from the 31 30 sale of motor fuel or special fuel as defined in 31 31 chapter 452A which is consumed for highway use or in 31 32 watercraft or aircraft if the fuel tax is paid on the 31 33 transaction and a refund has not or will not be 31 34 allowed, on the gross receipts from the rental of 31 35 rooms, apartments, or sleeping quarters which are 31 36 taxed under chapter 422A during the period the hotel 31 37 and motel tax is imposed, on the gross receipts from 31 38 the sale of equipment by the state department of 31 39 transportation, on the gross receipts from the sale of 31 40 self-propelled building equipment, pile drivers, 31 41 motorized scaffolding, or attachments customarily 31 42 drawn or attached to self-propelled building 31 43 equipment, pile drivers, and motorized scaffolding, 31 44 including auxiliary attachments which improve the 31 45 performance, safety, operation, or efficiency of the 31 46 equipment and replacement parts and are directly and 31 47 primarily used by contractors, subcontractors, and 31 48 builders for new construction, reconstruction, 31 49 alterations, expansion, or remodeling of real property 31 50 or structures, and on the gross receipts from the sale 32 1 of a lottery ticket or share in a lottery game 32 2 conducted pursuant to chapter99E99G and except the 32 3 tax shall not be imposed on the gross receipts from 32 4 the sale or use of natural gas, natural gas service, 32 5 electricity, or electric service in a city or county 32 6 where the gross receipts from the sale of natural gas 32 7 or electric energy are subject to a franchise fee or 32 8 user fee during the period the franchise or user fee 32 9 is imposed. A local sales and services tax is 32 10 applicable to transactions within those incorporated 32 11 and unincorporated areas of the county where it is 32 12 imposed and shall be collected by all persons required 32 13 to collect state gross receipts taxes. However, a 32 14 person required to collect state retail sales tax 32 15 under chapter 422, division IV, is not required to 32 16 collect local sales and services tax on transactions 32 17 delivered within the area where the local sales and 32 18 services tax is imposed unless the person has physical 32 19 presence in that taxing area. All cities contiguous 32 20 to each other shall be treated as part of one 32 21 incorporated area and the tax would be imposed in each 32 22 of those contiguous cities only if the majority of 32 23 those voting in the total area covered by the 32 24 contiguous cities favor its imposition. 32 25 Sec. . Section 422E.3, subsection 2, Code 2003, 32 26 is amended to read as follows: 32 27 2. The tax shall be imposed on the same basis as 32 28 the state sales and services tax or in the case of the 32 29 use of natural gas, natural gas service, electricity, 32 30 or electric service on the same basis as the state use 32 31 tax and shall not be imposed on the sale of any 32 32 property or on any service not taxed by the state, 32 33 except the tax shall not be imposed on the gross 32 34 receipts from the sale of motor fuel or special fuel 32 35 as defined in chapter 452A which is consumed for 32 36 highway use or in watercraft or aircraft if the fuel 32 37 tax is paid on the transaction and a refund has not or 32 38 will not be allowed, on the gross receipts from the 32 39 rental of rooms, apartments, or sleeping quarters 32 40 which are taxed under chapter 422A during the period 32 41 the hotel and motel tax is imposed, on the gross 32 42 receipts from the sale of equipment by the state 32 43 department of transportation, on the gross receipts 32 44 from the sale of self-propelled building equipment, 32 45 pile drivers, motorized scaffolding, or attachments 32 46 customarily drawn or attached to self-propelled 32 47 building equipment, pile drivers, and motorized 32 48 scaffolding, including auxiliary attachments which 32 49 improve the performance, safety, operation, or 32 50 efficiency of the equipment, and replacement parts and 33 1 are directly and primarily used by contractors, 33 2 subcontractors, and builders for new construction, 33 3 reconstruction, alterations, expansion, or remodeling 33 4 of real property or structures, and on the gross 33 5 receipts from the sale of a lottery ticket or share in 33 6 a lottery game conducted pursuant to chapter99E99G 33 7 and except the tax shall not be imposed on the gross 33 8 receipts from the sale or use of natural gas, natural 33 9 gas service, electricity, or electric service in a 33 10 city or county where the gross receipts from the sale 33 11 of natural gas or electric energy are subject to a 33 12 franchise fee or user fee during the period the 33 13 franchise or user fee is imposed. 33 14 Sec. . Section 537A.4, unnumbered paragraph 2, 33 15 Code 2003, is amended to read as follows: 33 16 This section does not apply to a contract for the 33 17 operation of or for the sale or rental of equipment 33 18 for games of skill or games of chance, if both the 33 19 contract and the games are in compliance with chapter 33 20 99B. This section does not apply to wagering under 33 21 the pari-mutuel method of wagering authorized by 33 22 chapter 99D. This section does not apply to the sale, 33 23 purchase or redemption of a ticket or share in the 33 24 state lottery in compliance with chapter99E99G. 33 25 This section does not apply to wagering under the 33 26 excursion boat gambling method of wagering authorized 33 27 by chapter 99F. This section does not apply to the 33 28 sale, purchase, or redemption of any ticket or similar 33 29 gambling device legally purchased in Indian lands 33 30 within this state. 33 31 Sec. . Section 714B.10, subsection 1, Code 33 32 2003, is amended to read as follows: 33 33 1. Advertising by sponsors registered pursuant to 33 34 chapter 557B, licensed pursuant to chapter 99B, or 33 35 regulated pursuant to chapter 99D,99E, or99F, or 33 36 99G. 33 37 Sec. . Section 725.9, subsection 5, Code 2003, 33 38 is amended to read as follows: 33 39 5. This chapter does not prohibit the possession 33 40 of gambling devices by a manufacturer or distributor 33 41 if the possession is solely for sale out of the state 33 42 in another jurisdiction where possession of the device 33 43 is legal or for sale in the state or use in the state 33 44 if the use is licensed pursuant to either chapter 99B 33 45 or chapter99E99G. 33 46 Sec. . Section 725.15, Code 2003, is amended to 33 47 read as follows: 33 48 725.15 EXCEPTIONS FOR LEGAL GAMBLING. 33 49 Sections 725.5 to 725.10 and 725.12 do not apply to 33 50 a game, activity, ticket, or device when lawfully 34 1 possessed, used, conducted, or participated in 34 2 pursuant to chapter 99B,99E, or99F, or 99G. 34 3 Sec. . Chapter 99E, Code 2003, is repealed. 34 4 Sec. . IOWA LOTTERY AUTHORITY TRANSITION 34 5 PROVISIONS. 34 6 1. For purposes of this section, unless the 34 7 context otherwise requires: 34 8 a. "Iowa lottery authority" means the Iowa lottery 34 9 authority as created in this Act pursuant to chapter 34 10 99G. 34 11 b. "Iowa lottery board" means the five-member 34 12 board established pursuant to 1985 Iowa Acts, chapter 34 13 33, section 105. 34 14 c. "Lottery division" means the lottery division 34 15 of the department of revenue and finance established 34 16 pursuant to 1985 Iowa Acts, chapter 33, section 103. 34 17 2. The Iowa lottery authority shall be the legal 34 18 successor to the lottery division and, as such, shall 34 19 assume all rights, privileges, obligations, and 34 20 responsibilities of the lottery division. The 34 21 promulgated rules of the lottery division shall remain 34 22 in full force and effect as the rules of the authority 34 23 until amended or repealed by the authority. In 34 24 addition, the Iowa lottery authority may continue the 34 25 security practices and procedures utilized by the 34 26 lottery division until amended or repealed by the 34 27 authority. 34 28 3. The Iowa lottery authority is created effective 34 29 at 12:01 a.m. on September 1, 2003, upon which date 34 30 and time the authority shall become the legal 34 31 successor to the lottery division. Until the 34 32 aforesaid date and time, no business shall be 34 33 conducted by the authority on behalf of the lottery, 34 34 provided, however, that the Iowa lottery commissioner 34 35 and Iowa lottery board shall implement such measures 34 36 as are appropriate to ensure a smooth transition from 34 37 the agency to the Iowa lottery authority as of the 34 38 effective date of succession. 34 39 4. Notwithstanding any provision of chapter 99G, 34 40 as created by this Act, to the contrary, the 34 41 commissioner of the Iowa lottery established pursuant 34 42 to 1985 Iowa Acts, chapter 33, section 103, as amended 34 43 by 1986 Iowa Acts, chapter 1245, section 404, shall 34 44 serve as the initial chief executive officer of the 34 45 Iowa lottery authority. In addition, notwithstanding 34 46 any provision of section 99G.9, as created by this 34 47 Act, to the contrary, the term of office for the chief 34 48 executive officer of the Iowa lottery authority as of 34 49 September 1, 2003, shall end April 30, 2008. 34 50 5. Notwithstanding any provision of chapter 99G, 35 1 as created by this Act, to the contrary, the initial 35 2 board of directors of the Iowa lottery authority shall 35 3 consist of the duly appointed and confirmed members of 35 4 the Iowa lottery board serving at the date of 35 5 succession. Said board members shall serve as members 35 6 of the Iowa lottery authority's board of directors 35 7 throughout the remainder of their respective Iowa 35 8 lottery board terms, subject to earlier resignation or 35 9 removal from office for cause as provided by this Act. 35 10 6. Personnel of the lottery division employed on 35 11 September 1, 2003, shall transition to the Iowa 35 12 lottery authority as the initial authority employees. 35 13 7. Whereas the lottery division was authorized 35 14 only as a self-funded enterprise and except for an 35 15 initial appropriation for start-up expenses, funds of 35 16 the state have not been authorized for use or 35 17 obligation to pay the expenses or prizes of the 35 18 lottery division. The Iowa lottery authority shall 35 19 function as the legal successor to the lottery 35 20 division and shall assume all of the assets and 35 21 obligations of the lottery division, and funds of the 35 22 state shall not be used or obligated to pay the 35 23 expenses or prizes of the authority or its 35 24 predecessor, the lottery division. 35 25 8. In order to effect an immediate and efficient 35 26 transition of the lottery from the lottery division to 35 27 the Iowa lottery authority, as soon as practicable, 35 28 the Iowa lottery authority shall do all of the 35 29 following: 35 30 a. Take such steps and enter into such agreements 35 31 as the board of the Iowa lottery authority may 35 32 determine are necessary and proper in order to effect 35 33 the transfer, assignment, and delivery to the 35 34 authority from the state of all the tangible and 35 35 intangible assets constituting the lottery, including 35 36 the exclusive right to operate the lottery and the 35 37 assignment to and assumption by the authority of all 35 38 agreements, covenants, and obligations of the lottery 35 39 division and other agencies of the state, relating to 35 40 the operation and management of the lottery. 35 41 b. Receive as transferee from the state of Iowa 35 42 all of the tangible and intangible assets constituting 35 43 the lottery including, without limitation, the 35 44 exclusive authorization to operate a lottery in the 35 45 state of Iowa and ownership of annuities and bonds 35 46 purchased prior to the date of transfer and held in 35 47 the name of the Iowa lottery for payment of lottery 35 48 prizes, and shall assume and discharge all of the 35 49 agreements, covenants, and obligations of the lottery 35 50 division entered into and constituting part of the 36 1 operation and management of the lottery. In 36 2 consideration for such transfer and assumption, the 36 3 Iowa lottery authority shall transfer to the state all 36 4 net profits of the authority, at such times and 36 5 subject to such financial transfer requirements as are 36 6 provided in this Act. 36 7 c. Have perpetual succession as an instrumentality 36 8 of the state and a public authority. 36 9 9. Notwithstanding any provision of chapter 99G, 36 10 as created by this Act, to the contrary, the following 36 11 provisions shall apply to the Iowa lottery authority: 36 12 a. Moneys appropriated from the lottery fund to 36 13 the department of revenue and finance, for 36 14 administration of the lottery for the fiscal year 36 15 beginning July 1, 2003, and unexpended prior to 36 16 September 1, 2003, shall be appropriated to the Iowa 36 17 lottery authority for operation of the lottery. 36 18 b. Of the moneys collected by the lottery division 36 19 and Iowa lottery authority for the fiscal year 36 20 beginning July 1, 2003, fifty-four million eight 36 21 hundred thousand dollars shall be transferred to the 36 22 general fund of the state. 36 23 c. Any authority for establishing the budget of 36 24 the Iowa lottery authority pursuant to chapter 99G, as 36 25 created by this Act, shall only apply for the fiscal 36 26 year beginning July 1, 2004, and each succeeding 36 27 fiscal year. 36 28 Sec. . EFFECTIVE DATE. This division of this 36 29 Act, creating the Iowa lottery authority, takes effect 36 30 September 1, 2003." 36 31 #2. By renumbering as necessary. 36 32 36 33 36 34 36 35 JEFF LAMBERTI 36 36 SF 453.304 80 36 37 ec/cf
Text: S03318 Text: S03320 Text: S03300 - S03399 Text: S Index Bills and Amendments: General Index Bill History: General Index
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