PENNSYLVANIA GAMING CONTROL BOARD
[58 PA. CODE CH. 461, 465 AND 467]
Temporary Regulations; Slot Machines
[36 Pa.B. 3954]
[Saturday, July 22, 2006]The Pennsylvania Gaming Control Board (Board), under 4 Pa.C.S. § 1203(a) (relating to temporary regulations), adopts temporary regulations to facilitate implementation of 4 Pa.C.S. Part II (relating to gaming), enacted by the act of July 5, 2004 (P. L. 572, No. 71) (Act 71). The Board's temporary regulations will be added to Part VII (relating to Gaming Control Board). Section 461.7 of Chapter 461, entitled slot machine testing and certification requirements, is amended to read as set forth in Annex A. Sections 461.4, 461.7, 461.18a and 461.22 are added to Chapter 461. Sections 465.1, 465.10, 465.12, 465.13 and 465.15 of Chapter 465, entitled accounting and internal controls, are amended to read as set forth in Annex A. Sections 465.21--465.31 are added to Chapter 465. Chapter 467, entitled commencement of slot operations, is added to Subpart E, entitled Slot machine testing, certification and control.
Purpose and Background
Under 4 Pa.C.S. § 1203(a), the Board is authorized to promulgate temporary regulations to facilitate the prompt implementation of Act 71. The regulations are necessary to enhance the credibility of the licensed operation of slot machines and associated equipment within this Commonwealth and to carry out the policy and purposes of the Board.
Under 4 Pa.C.S. § 1203(b), the temporary regulations adopted by the Board expire no later than 3 years following the effective date of Act 71 or upon promulgation of regulations as generally provided by the law. These temporary regulations shall not be subject to sections 201--205 of the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. §§ 1201--1208), known as the Commonwealth Documents Law (CDL), or to the Regulatory Review Act (71 P. S. §§ 745.1--745.15).
Financial Impact
Act 71 and the regulations will provide for the implementation and management of gaming within this Commonwealth and the collection of fees and taxes from entities and individuals authorized by the Board to be employed by, provide gaming related services to or operate gaming facilities. The appropriations from the Commonwealth for the implementation of Act 71 and costs of administering 4 Pa.C.S. Part II will be reimbursed by the licensed entities as specified within Act 71. Individuals and entities that wish to obtain licenses as gaming entities shall pay to the Gaming Fund significant licensing fees to obtain the authority to do business within this Commonwealth. Part of these fees shall reimburse the Board and the Pennsylvania State Police for licensing processes and background investigations. The licensing, registration, certification and permitting of individuals and other classes of applicants will be reimbursed by the applicants through fees established by the Board. It is anticipated that all expenses of the Board and all associated activities shall be reimbursed by the applicants and gaming entities as previously specified. The Board shall have no financial impact on the State budget.
Statutory Authority
The Board is authorized under 4 Pa.C.S. § 1203(a) to adopt and publish temporary regulations to implement the policies and purposes of Act 71.
Regulatory Review
Under 4 Pa.C.S. § 1203(b), the Board's authority to adopt temporary regulations expires 2 years from the effective date of Act 71.
Findings
The Board finds that:
(1) Under 4 Pa.C.S. § 1203(a), the temporary regulations are exempt from the requirements of the Regulatory Review Act and sections 201--205 of the CDL.
(2) The adoption of the temporary regulations provided by this order is necessary and appropriate for the administration of the authorizing statute.
Order
The Board, acting under the authorizing statute, orders that:
(a) The Board, acting under the authority of Act 71, adopts as its final-form temporary regulations, the proposed regulations by resolution at the June 28, 2006, public meeting. The temporary regulations pertain to slot machine testing and certification requirements, accounting and internal controls and commencement of slot operations.
(b) The temporary regulations of the Board, 58 Pa. Code, are amended by amending §§ 461.4, 461.7, 465.1, 465.10, 465.12, 465.13 and 465.15 and by adding §§ 461.22, 461.23, 465.21--465.31, 467.1 and 467.2 to read as set forth in Annex A, with ellipses referring to the existing text of the regulations.
(c) The temporary regulations are effective June 28, 2006.
(d) The temporary regulations shall be posted in their entirety on the Board's website and published in the Pennsylvania Bulletin.
(e) The temporary regulations shall be subject to amendment as deemed necessary by the Board in accordance with the purpose of Act 71 and to further the intent of Act 71.
(f) The Chairperson of the Board shall certify this order and deposit the regulations with the Legislative Reference Bureau as required by law.
THOMAS A. DECKER,
ChairpersonFiscal Note: 125-36. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 58. RECREATION
PART VII. GAMING CONTROL BOARD
Subpart E. SLOT MACHINE TESTING, APPROVAL AND CONTROL
CHAPTER 461. SLOT MACHINES AND ASSOCIATED EQUIPMENT § 461.4. Submission for testing and approval.
* * * * * (k) A slot machine licensee is prohibited from installing in its licensed facility any slot machine or associated equipment, or modification thereto, required to be tested and approved under subsection (b) unless the equipment, device or software has been approved by the Board. A slot machine licensee may not modify, alter or tamper with any approved slot machine or associated equipment. Any slot machine or associated equipment installed in a licensed facility in contravention of this requirement will be subject to seizure by the Board.
(m) A slot machine licensee shall immediately notify the Board, in a manner and form the Board prescribes, of any known or suspected defect or malfunction in any slot machine or associated equipment installed in its licensed facility. The slot machine licensee shall comply with any instructions issued by the Board with regard to the continued operation of the slot machine or associated equipment.
(n) If a dispute arises with a patron concerning payment of alleged winnings, the slot machine licensee shall notify the patron in writing, concurrent with its initial receipt of notice of the dispute, that the patron has the right to contact the Board with regard to the dispute.
(o) When a slot machine licensee refuses to pay winnings claimed by a patron and the patron and the slot machine licensee remain unable to resolve the dispute after 7 days, the slot machine licensee shall, on the next day, notify the Board in writing of the dispute in a manner and form the Board prescribes. The notice must identify all parties to the dispute and state all known relevant facts regarding the dispute.
(p) Concurrent with the initial receipt of slot machines, an applicant for, or holder of, a slot machine license shall file a slot machine master list as required by § 463.5 (relating to slot machine master list).
(q) The testing of equipment, devices or software under this subpart may require the dismantling of the product and testing that may result in damage to, or destruction of, one or more systems or components. Once submitted for testing, equipment, devices or software will not be returned to the manufacturer unless otherwise determined by the Board.
§ 461.7. Slot machine minimum design standards.
* * * * * (v) Each slot machine must be equipped with a lock controlling access to the card cage door securing its microprocessor, the key to which must be different from any other key securing access to the slot machine's components including its belly door or main door, bill validator or slot cash storage box. Access to the key securing the microprocessor shall be limited to a supervisor in the slot operations department, which department shall establish a sign out and sign in procedure with regard to this key.
(w) Each slot machine must be equipped with a mechanism for detecting and communicating to a slot monitoring system any activity with regard to access to the card cage door securing its microprocessor.
(x) The Board may waive one or more of the slot machine minimum design standards in this section or technical standards adopted by the Board applicable to slot machine design, upon a determination that a slot machine prototype or modification as configured nonetheless meets the operational integrity standards of the act, this subpart and technical standards adopted by the Board.
§ 461.22. Automated jackpot payout machines.
(a) An automated jackpot payout machine is the collective hardware, software, communications technology and other ancillary equipment used to facilitate the payment of a jackpot that is not totally and automatically paid directly from a slot machine.
(b) An automated jackpot payout machine must comply with the act, this subpart and technical standards on automated jackpot payout machines adopted by the Board.
(c) A slot machine licensee is prohibited from utilizing an automated jackpot payout machine which has not been tested and approved by the Board under § 461.4 (relating to submission for testing and approval).
(d) Prior to commencing use of an automated jackpot payout machine, each slot machine licensee shall establish a comprehensive system of internal controls addressing the payment of jackpot payouts utilizing an automated jackpot payout machine and the distribution of currency or coin, or both, to the machines. The internal controls shall be submitted to, and approved by the Board under § 465.3 (relating to internal control systems and audit protocols.
(e) The Board may waive one or more of the requirements of this section or a technical standards applicable to automated jackpot payout machines adopted by the Board upon a determination that the automated jackpot payout machine as configured nonetheless meets the operational integrity requirements of the act, this subpart and any technical standards adopted by the Board.
§ 461.23. Slot machines and associated equipment utilizing alterable storage media.
(a) Definition. The following term, when used in this section, has the following meaning, unless the context clearly indicates otherwise:
Alterable storage media--Memory or other storage medium, such as an EEPROM, flash, optical or magnetic storage device, which is contained in a slot machine or associated equipment subject to approval under § 461.4 (relating to submission for testing and approval), that allows the modification of programs or data on the storage media during the normal operation of the slot machine or associated equipment. The term does not include:
(1) Memory or other storage medium typically considered to be alterable but through either software or hardware means approved by the Board have been rendered unalterable and remain verifiable by the central control computer system.
(2) Associated equipment using alterable storage media that the Board determines are incapable of influencing the integrity or outcome of game play.
(b) Use of alterable storage media. Any use of alterable storage media in a slot machine or associated equipment must be in compliance with the act, this subpart and technical standards on alterable storage media adopted by the Board.
CHAPTER 465. ACCOUNTING AND INTERNAL CONTROLS § 465.1. Definitions.
The following words and terms, when used in this part, have the following meanings, unless the context clearly indicates otherwise:
* * * * * Signature--The written name of an employee of a slot machine licensee signifying that the employee has prepared forms, records and documents or authorized, observed or participated in a transaction to a sufficient extent to attest to the accuracy of the information recorded thereon, in conformity with this subpart and the slot machine licensee's system of internal controls and which is in either of the following formats:
(i) The employee's first initial, last name and Board license number, written by the employee, immediately adjacent to or above the clearly printed or preprinted title of the employee.
(ii) The employee's identification number or other computer identification code issued to the employee by the slot machine licensee, if the document to be signed is authorized by the Board to be generated by a slot computer system and the method of signature is approved or required by the Board.
§ 465.10. Surveillance system; surveillance department control; surveillance department restrictions.
* * * * * (l) In accordance with § 465.3(a)(5), each slot machine licensee shall be required to submit, for Board approval, a minimum staffing submission with regard to its surveillance monitor rooms. The minimum staffing submission must consider the size and layout of the licensed facility as well as the number of slot machines and must at all times provide for adequate and effective surveillance of activities inside and outside the licensed facility. A slot machine licensee may not implement a change or amendment in its surveillance monitor room minimum staffing submission without Board approval of the change or amendment.
* * * * * § 465.12. Slot machine licensee's organization.
* * * * * (b) In addition to satisfying the requirements of subsection (a), each slot machine licensee's system of internal controls must include, at a minimum, the following departments and supervisory positions, each of which must be categorized as mandatory and cooperate with, yet perform independently of, all other mandatory departments and supervisory positions of the slot machine licensee. Notwithstanding the foregoing, a department or supervisor of a slot machine licensee that required or authorized by this section may operate under or in conjunction with a mandatory department or supervisor provided the organizational structure is not inconsistent with the standards contained within the act and subsection (a). Mandatory departments and supervisory positions are as follows:
(1) A surveillance department supervised by a person located at the licensed facility who functions, for regulatory purposes, as the director of surveillance. The director of surveillance shall be subject to the reporting requirements specified in subsection (c) and shall be licensed as a key employee. The surveillance department shall be responsible for the following:
* * * * * (viii) Providing immediate notice to appropriate supervisors, the Bureau and the Pennsylvania State Police upon detecting, and also upon commencing video recording of, any person who is engaging in or attempting to engage in, or who is reasonably suspected of cheating, theft, embezzlement, a violation of this part or other illegal activities, including any person who is required to be excluded or ejected from the licensed facility under section 1514 of the act, who may be excluded or ejected from the licensed facility under section 1515 of the act or is self excluded from the gaming floor and gaming activities at all licensed facilities under section 1516 of the act.
* * * * * (5) A security department supervised by a person located at the licensed facility who functions, for regulatory purposes, as the director of security. The security department must be licensed as a key employee and be responsible for the overall security of the licensed facility including the following:
* * * * * (ix) Providing immediate notice to the Pennsylvania State Police upon detecting the presence in the licensed facility of a person possessing a firearm or handgun in violation of § 465.14 (relating to firearms; possession within a licensed facility).
(x) Providing immediate notice to appropriate supervisors, the Bureau and the Pennsylvania State Police upon detecting any person who is engaging in or attempting to engage in, or who is reasonably suspected of cheating, theft, embezzlement, a violation of this part or other illegal activities, including any person who is required to be excluded or ejected from the licensed facility under section 1514 of the act, who may be excluded or ejected from the licensed facility under section 1515 of the act or is self excluded from the gaming floor and gaming activities at all licensed facilities under section 1516 of the act.
* * * * * § 465.13. Access badges and temporary access badges.
(a) For the purposes of this section, an access badge is any form of identification issued by a slot machine licensee and worn by a slot machine licensee employee, for purposes of identifying the areas of the licensed facility where the employee may obtain access in the course of the performance of his normal duties.
(b) Each slot machine licensee shall establish procedures, in writing, for readily and effectively identifying each person permitted, during the normal course of performing his duties, to have access to one or more restricted areas within the licensed facility.
(1) The procedures must include the requirement that persons wear, in a visible location, an access badge.
(2) The procedures must also include a methodology for updating the access badge procedures to reflect changes and amendments in the slot machine licensee's table of organization and the positions approved with respect thereto.
(3) The procedures must further include provisions expressly addressing access by employees of licensed manufacturers, licensed suppliers and registered and certified vendors.
(c) Each slot machine licensee shall also establish procedures, in writing, for readily and effectively identifying each person permitted, under temporary or emergency circumstances, to have access to one or more restricted areas within the licensed facility.
(1) The procedures must include the requirement that those persons wear, in a visible location, a temporary access badge.
(2) The procedures must also include a methodology for updating the temporary access badge procedures to reflect changes and amendments in the slot machine licensee's table of organization and the positions approved with respect thereto.
(3) The procedures must further include provisions expressly addressing temporary or emergency access by licensed manufacturers, licensed suppliers and registered and certified vendors.
(d) The procedures required in subsection (b) are to be designed, implemented and enforced by the security department in collaboration with the human resources department or its functional equivalent. The procedures in subsection (c) are to be designed, implemented and enforced by the security department. Procedures addressing both access badges and temporary access badges shall be retained in the security department and be made immediately available to the Board and the Pennsylvania State Police upon request. The slot machine licensee shall cooperate with the Board in making amendments to its procedures to improve the effectiveness of its access badge and temporary access badge systems.
§ 465.15. Security department minimum staffing.
In accordance with § 465.3(d)(5) (relating to internal control systems and audit protocols), each slot machine licensee shall be required to submit, for Board approval, a minimum staffing submission with regard to its security department. The minimum staffing submission must consider the size and layout of the licensed facility as well as the number and configuration of slot machines on the gaming floor and must at all times provide for adequate and effective security of the gaming floor and any restricted areas servicing the gaming operation. A slot machine licensee may not implement a change or amendment in its security department minimum staffing submission without Board approval of the change or amendment.
§ 465.21. Personal check cashing.
(a) Personal checks accepted by a slot machine licensee under § 501.8 (relating to prohibition on check cashing) to enable a person to take part in gaming must be:
(1) Drawn on a commercial bank, savings bank, saving and loan association, or credit union and payable on demand.
(2) Drawn for a specific amount.
(3) Made payable to the slot machine licensee.
(4) Currently dated, but not post dated.
(b) Personal checks accepted under subsection (a) shall be presented by the patron directly to a slot cashier who shall:
(1) Restrictively endorse the check ''for deposit only'' to the bank account designated by the slot machine licensee.
(2) Initial the check.
(3) Date and time stamp the check.
(4) Verify that the signature of the patron on the personal check and the patron's physical appearance agree with information recorded in a patron signature file created and maintained by the slot machine licensee in accordance with subsection (c) or with the signature and photograph or physical description contained on a government-issued identification credential presented by the patron. The slot machine licensee shall retain adequate documentation evidencing the signature verification performed in connection with the acceptance of each personal check.
(5) For personal checks equaling or exceeding $500, verify the validity of the check directly with the commercial bank, savings bank, saving and loan association or credit union upon which it is drawn or with a check verification service registered or certified as a vendor with the Board. The slot machine licensee shall retain adequate documentation evidencing the check verification performed in connection with the acceptance of each personal check.
(6) Immediately exchange the personal check for cash in an amount equal to the amount for which the check is drawn, not to exceed $2,500 per patron per gaming day.
(c) To record a patron's signature in a patron signature file, a slot cashier shall require the person for whom the file is to be created to present for examination the following:
(1) If the identity of the patron is to be confirmed in accordance with subsection (d)(1), one identification credential.
(2) If the identity of the patron is to be confirmed in accordance with subsection (d)(2), two identification credentials, at least one of which must contain a photograph or general physical description of the patron.
(d) Before a slot machine licensee may use a signature recorded in a patron signature file to verify the identity of a patron or the validity of a signature on a document, the slot machine licensee shall confirm the identity of the patron by either:
(1) Comparing the signature on the identification credential presented by the patron under subsection (c)(1) with the signature obtained from the patron and verifying the address of the patron's residence with a credit bureau, commercial bank or, if neither of these sources has the person's address on file or will not provide the information, with an alternative source, which does not include any documentation presented by the patron at the cashiers' cage.
(2) Comparing the signature on each of the identification credentials presented by the patron under subsection (c)(2) with the signature obtained from the patron and comparing the photograph or general physical description contained on at least one of the identification credentials with the patron's actual physical appearance.
(e) Any patron signature file established and maintained by a slot machine licensee under subsection (c) must include, in addition to the patron's signature, the following:
(1) The patron's name.
(2) The address of the patron's residence.
(3) The type of each identification credential examined under subsection (d) and an indication whether the identification credential contained a photograph or physical description of the person.
(4) For the purposes of this section, a physical description of the patron which includes:
(i) Date of birth.
(ii) Approximate height.
(iii) Approximate weight.
(iv) Hair color.
(v) Eye color.
(5) The date and time that the patron signature file was established.
(6) The procedure by which the identity of the person was confirmed under subsection (d), including:
(i) The source of confirmation, date and time if confirmed under subsection (d)(1).
(ii) The date and time of confirmation if confirmed under subsection (d)(2).
(7) The signature of the slot cashier or cashiers' cage supervisor who examined the identification credentials of the patron and established the patron signature file, which signature evidences that:
(i) The signature of the patron recorded in the patron signature file is consistent with the signature on each identification credential that was examined.
(ii) The physical description recorded in the patron signature file is consistent with both the actual appearance of the person and any photograph or physical description that may be contained on an identification credential that was examined.
(f) Prior to accepting personal checks, each slot machine licensee shall establish a comprehensive system of internal controls applicable to the acceptance of personal checks. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols). The internal controls submitted by the slot machine licensee must address procedures for complying with this section including the dollar limitation per gaming day contained in subsection (b)(6).
§ 465.22. Wire transfers.
(a) A wire transfer accepted by a slot machine licensee on behalf of a patron under § 501.8 (relating to prohibition on check cashing) to enable a patron to take part in gaming shall be recorded in the slot machine licensee's cashiers' cage accountability no later than the next gaming day.
(b) Prior to commencing acceptance of wire transfers for gaming purposes, each slot machine licensee shall establish a comprehensive system of internal controls addressing the acceptance, verification, accounting for and sending of wire transfers. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
(c) The internal control procedures developed and implemented by the slot machine licensee under subsection (b) must include:
(1) A cashiers' cage log to record the following information with regard to wire transfers accepted:
(i) A sequential number assigned by the slot machine licensee to the wire transfer transaction.
(ii) The date and time of notification.
(iii) The name of the financial institution and account number to which the funds were transferred.
(iv) The amount of funds transferred.
(v) The name of the patron for whose benefit the funds were transferred.
(vi) The name and address of the financial institution from which the funds were transferred and the account number from which the funds were debited.
(vii) The method by which the slot machine licensee was notified of the receipt of the wire transfer and, if noticed by telephone, the name and title of the person providing notice.
(viii) The signature of the cashiers' cage employee receiving and recording the information required by this subsection.
(ix) When applicable, a notation that the wire transfer has been reversed under subsection (d).
(2) A requirement that a cashiers' cage supervisor other than the cashiers' cage employee who initially documented receipt of the wire transfer verify receipt of the wire transfer.
(3) A requirement that the cashiers' cage supervisor verifying receipt of the wire transfer document the verification process performed in the log required under subparagraph (1) including:
(i) The method by which the receipt of the wire transfer was verified and, if verified by telephone, the name and title of the person providing the verification.
(ii) The date and time of verification.
(iii) The signature of the cashiers' cage supervisor verifying receipt of the wire transfer.
(4) The procedures pursuant to which the identity of the patron is established, verified and documented, the wire transfer proceeds made available to the patron at the cashiers' cage and the cashiers' cage accountability adjusted.
(5) A cashiers' cage log to record the following information with regard to wire transfers sent on behalf of a patron:
(i) The name of the patron.
(ii) The date of the transaction.
(iii) The amount of funds transferred.
(iv) The source of funds transferred (cash, cash equivalent, jackpot payout).
(v) The name and address of the financial institution to which the funds will be transferred and the account number to which the funds will be credited.
(vi) The signature of the patron if the request to send a wire transfer is made in person at the cashiers' cage.
(vii) Documentation supporting the receipt of a request by the slot machine licensee to send a wire transfer on behalf of a patron if the request was not made in person at the cashiers' cage.
(viii) The signature of the cashiers' cage employee receiving and recording the information required by this subsection.
(ix) The signature of the cashiers' cage supervisor or accounting department supervisor authorizing the wire transfer.
(6) When sending a wire transfer on behalf of a patron, the procedures pursuant to which the identity of the patron is verified and documented and the cashiers' cage accountability adjusted.
(d) If, at the expiration of 14 gaming days following the deposit into its operating account of a wire transfer which has no documented business purpose other than having been accepted to enable a patron to take part in gaming, the wired funds remain in a slot machine licensee's operating account or cashiers' cage accountability, the slot machine licensee shall, on the next gaming day, take all steps necessary to return to the patron by wire transfer the amount initially accepted. The wire transfer shall be sent to the financial institution and to the account number from which the funds were debited. This reversal of the wire transfer shall be recorded in the wire transfer log maintained under subsection (c)(1).
§ 465.23. Cash equivalents.
(a) Cash equivalents such as recognized traveler's checks, cashiers' checks and money orders may be accepted by a slot machine licensee under § 501.8 (relating to prohibition on check cashing) to enable a person to take part in gaming.
(b) Prior to commencing acceptance of cash equivalents for gaming purposes, each slot machine licensee shall establish a comprehensive system of internal controls addressing the acceptance and verification of cash equivalents. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
(c) The internal control procedures developed and implemented by the slot machine licensee under subsection (b) must include:
(1) A requirement that cashiers' cage employees perform the specific verification procedures required by the issuer of each cash equivalent accepted. The slot machine licensee shall retain adequate documentation evidencing the verification of each cash equivalent.
(2) A requirement that cashiers' cage employees examine each cash equivalent for counterfeiting, forgery or alteration.
(3) When a slot machine licensee elects to incorporate into its verification procedures a level of reliance on previously accepted cash equivalents, the procedures must articulate the general parameters governing the reliance.
(4) Criteria for cashiers' cage supervisor involvement in the verification process.
(5) Procedures for verifying any patron signature on the cash equivalent. Signature verification must be accomplished in accordance with the signature verification procedures in § 465.21 (relating to personal checks). The slot machine licensee shall retain adequate documentation evidencing each signature verification.
§ 465.24. Customer deposits.
(a) At the request of a patron, a slot machine licensee may hold cash, funds accepted by means of wire transfer in accordance with § 465.22 (relating to wire transfers) or cash equivalents accepted in accordance with § 465.23 (relating to cash equivalents) for a patron's subsequent use for gaming purposes. For the purposes of this section, after complying with this subpart for acceptance and verification, noncash items shall be considered converted to cash and deposited as cash for credit to the patron in a customer deposit account maintained in the cashiers' cage.
(b) Prior to agreeing to hold a patron's cash, funds accepted by means of wire transfer in accordance with § 465.22 or cash equivalents accepted in accordance with § 465.23 for a patron's subsequent use for gaming purposes, each slot machine licensee shall establish a comprehensive system of internal controls addressing the receipt and withdrawal of a customer deposit. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
(c) The internal control procedures developed and implemented by the slot machine licensee under subsection (b) must include:
(1) A requirement that customer deposits be accepted at the cashiers' cage.
(2) A requirement that customer deposits be withdrawn by the patron at the cashiers' cage or upon receipt by the slot machine licensee of a written request for withdrawal whose validity has been established.
(3) A requirement that the patron receive a receipt for any customer deposit accepted reflecting the total amount deposited, the date of the deposit and the signature of the cashiers' cage employee accepting the customer deposit.
(4) Procedures for verifying the identity of the patron at the time of withdrawal. Signature verification must be accomplished in accordance with the signature verification procedures under § 465.21 (relating to personal checks). The slot machine licensee shall retain adequate documentation evidencing the patron identification process and signature verification.
§ 465.25. Count room characteristics.
(a) Each slot machine licensee shall have adjacent or reasonably proximate to the cashiers' cage a room, to be known as a count room, specifically designated, designed and used for counting the contents of slot cash storage boxes.
(b) The count room shall be designed and constructed to provide maximum security for the materials housed therein and for the activities conducted therein. Each slot machine licensee shall design and construct a count room with the following security measures:
(1) A metal door installed on each entrance and exit equipped with an alarm device which audibly signals the surveillance department monitoring room and the security department whenever a door to the count room is opened at times other than those times for which the slot machine licensee has provided prior notice under § 465.26 (relating to counting of slot cash storage boxes).
(2) Each entrance and exit door must be equipped with two separate locks, the keys to which must be different from each other and different from the lock securing the contents of each slot cash storage box. The key to one of the locks shall be maintained and controlled by the security department and the key to the other lock shall be maintained and controlled by slot accounting. Sign-out and sign-in procedures must be established for both keys.
(c) Located within the count room must be:
(1) A table constructed of clear glass or similar material for the emptying, counting and recording of the contents of slot cash storage boxes.
(2) Surveillance cameras capable of the following:
(i) Effective video monitoring of the entire count process.
(ii) Effective video monitoring of the interior of the count room, including any storage cabinets or trolleys used to store slot cash storage boxes and any Board-approved trolley storage area located adjacent to the count room.
§ 465.26. Counting and recording of slot cash storage boxes.
(a) Each slot machine licensee shall place on file with the Board, in the manner prescribed by the Board, a schedule setting forth the specific times during which the contents of slot cash storage boxes are to be counted and recorded. Any deviation from the schedule shall be noticed to the Board in advance in a manner prescribed by the Board.
(b) Computerized equipment utilized to count and strap currency, gaming vouchers and coupons must:
(1) Automatically provide two separate counts of the funds at different stages of the count process and, if the separate counts are not in agreement, document the discrepancy.
(2) Be capable of determining the value of a gaming voucher or coupon by independently examining information printed on the gaming voucher or coupon. The information is used by the counting equipment to either calculate the value internally or obtain the value directly from the gaming voucher system or coupon system in a secure manner as approved by the Board. If the gaming voucher system is utilized to obtain the value of a gaming voucher or coupon, the gaming voucher system must perform a calculation or integrity check to ensure that the value has not been altered in the system in any manner since the time of issuance.
(c) Persons accessing the count room when uncounted funds are present shall wear clothing without any pockets or other compartments with the exception of representatives of the Board, the Department, the Pennsylvania State Police, the security department and the internal audit department.
(d) Persons present in the count room may not:
(1) Carry a handbag or other container unless it is transparent.
(2) Remove their hands from or return them to a position on or above the count table or counting equipment unless the backs and palms of the hands are first held straight out and exposed to the view of other members of the count team and a surveillance camera.
(e) Immediately prior to the commencement of the count, a count room employee shall notify the surveillance department that the count is about to begin to facilitate the recording, under § 465.10(e) (relating to surveillance system; surveillance department control; surveillance department restrictions), of the entire count process.
(f) Prior to commencing gaming operations, each slot machine licensee shall establish a comprehensive system of internal controls addressing the opening, counting and recording of the contents of slot cash storage boxes. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
(g) The internal controls developed and implemented by the slot machine licensee under subsection (f) must include a description of the computer equipment used in the counting and recording process and other systems, if any, that communicate with that computer equipment for purposes related to the counting of gross terminal revenue.
(h) Any gaming voucher or coupon deposited in a slot cash storage box shall be counted and included in the calculation of gross terminal revenue without regard to the validity of the gaming voucher or coupon.
(i) Any coupon which has not already been canceled upon acceptance or during the count shall be canceled prior to the conclusion of the count, in a manner approved by the Board.
(j) Any variance between the value of cash gaming vouchers and coupons in a slot cash storage box as determined in the count room and the value for that particular slot cash storage box recorded on corresponding reports generated by the gaming voucher system or coupon system shall be disclosed to the Board in a detailed written report citing each variance, the reason for the variance and the corrective action taken. This variance report shall be filed by the slot machine licensee with the Board within 72 hours of the count that is the subject of the comparison and shall be filed in the manner prescribed by the Board.
§ 465.27. Jackpot payouts.
(a) Prior to commencing gaming operations, each slot machine licensee shall establish a comprehensive system of internal controls addressing jackpot payouts that are not paid directly from a slot machine. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
(b) The internal control procedures developed and implemented by the slot machine licensee under subsection (a) must include:
(1) A request for jackpot payout document or, in the alternative, an electronic entry into a slot computer system generating jackpot payouts, by a slot attendant or slot supervisor, evidencing the observation by the slot attendant or slot supervisor of the winning combination of characters on the slot machine and a determination as to the appropriate amount of the jackpot payout based on the observed winning combinations.
(2) A requirement that the preparer of the request for jackpot payout document or, in the alternative, the employee performing the electronic entry into the slot computer system, be a slot supervisor if the hand paid jackpot is $10,000 or more.
(3) A requirement that the following information be on the request for jackpot payout document or electronically entered into the slot computer system and maintained in stored data:
(i) The date and time of the jackpot.
(ii) The asset number of the slot machine on which the jackpot was registered.
(iii) The winning combination of characters constituting the jackpot or a code corresponding to the winning combination of characters constituting the jackpot.
(iv) The amount of the jackpot payout.
(v) The method of payment requested by the patron (that is, cash, slot licensee check).
(vi) The signature or identification code of the preparer.
(vii) The following additional signatures or identification codes shall be required if the slot machine or the progressive meter is reset prior to the patron being paid or if payment is made directly to the patron by a slot cashier:
(A) The signature or identification code of a security department member or slot attendant other than the preparer attesting to the winning combination of characters constituting the jackpot and the amount of the jackpot payout.
(B) The signature or identification code of the slot shift manager attesting to the winning combination of characters constituting the jackpot and the amount of the jackpot payout when the jackpot amount is $25,000 or more.
(4) A requirement that following preparation the request for jackpot payout document be immediately transported by the preparer, or the information made available by the slot computer system, to the cashiers' cage where it will serve to authorize the preparation of a jackpot payout document.
(5) A requirement that if the winning patron will not be paid before the slot machine or progressive meter is reset, the preparer of the request for jackpot payout document or the employee performing the electronic entry required by paragraph (1) shall also prepare a two part receipt document containing the following information:
(i) The date and time of the jackpot.
(ii) The asset number of the slot machine on which the jackpot was registered.
(iii) The winning combination of characters constituting the jackpot or a code corresponding to the winning combination of characters constituting the jackpot.
(iv) The amount of the jackpot payout.
(v) The signature of the winning patron on the original form only.
(vi) The signature of the preparer attesting that the information on the receipt document is correct and agrees with the information on the request for jackpot payout document or in stored data.
(6) A requirement that the receipt document be distributed as follows:
(i) The original shall be immediately delivered to the slot cashier by the preparer, security department member or verifying slot attendant along with the request for jackpot payout document if manually generated in accordance with paragraph (1).
(ii) The duplicate shall be immediately presented to the winning patron who shall be required to present the duplicate receipt document before being paid the jackpot in accordance with the procedures set forth in this section.
(7) A requirement that the information in subparagraphs (i)--(vi) be on any jackpot payout document generated by the slot computer system. The data may not be susceptible to change or removal by any personnel after preparation of a jackpot payout document:
(i) The asset number of the slot machine on which the jackpot was registered.
(ii) The winning combination of characters constituting the jackpot or a code corresponding to the winning combination of characters constituting the jackpot.
(iii) The date on which the jackpot occurred.
(iv) The amount that is to be paid from cashiers' cage funds. However, this amount may, in the slot machine licensee's discretion, be rounded up to the nearest whole dollar.
(v) The date, time and method of payment (that is, cash, slot licensee casino).
(vi) The signature or identification code of the preparer.
(8) A requirement that whenever the winning patron is paid directly by the slot cashier the following procedures be followed:
(i) A jackpot payout document be generated by the slot computer system in accordance with paragraph (7).
(ii) If a one-part request for jackpot payout document is involved and a security department member or verifying slot attendant other than the preparer has not signed the one part request for jackpot payout document, the slot cashier shall summon a security department member or slot attendant other than the preparer of the request for jackpot payout document and provide that employee with the request for jackpot payout document. The security department member or verifying slot attendant shall proceed to the slot machine identified on the request for jackpot payout document and sign the request for jackpot payout document attesting that the winning combination of characters on the slot machine and the amount to be paid match those which appear on the request for jackpot payout document. If the jackpot amount is $25,000 or more, a slot shift manager shall similarly sign the request for jackpot payout document attesting that the winning combination of characters on the slot machine and the amount to be paid match those which appear on the request for jackpot payout document. The request for jackpot payout document shall then be immediately returned to the slot cashier.
(iii) After the slot cashier determines that the required signatures verifying the winning combination of characters on the slot machine and the amount to be paid have been placed on the one part request for jackpot payout document, if the amount being paid is less than $10,000, the slot cashier shall pay the winning patron in the presence of the preparer of the request for jackpot payout document. If the amount being paid is $10,000 or more but less than $25,000, the slot cashier shall pay the winning patron in the presence of the slot attendant supervisor who prepared the request for jackpot payout document. If the amount being paid by the cashier is $25,000 or more, the slot cashier shall pay the winning patron in the presence of the slot attendant supervisor and slot shift manager who prepared the request for jackpot payout document in accordance with this subsection. Personnel required by this subsection to witness the payment shall sign the duplicate jackpot payout document attesting to the accuracy of the information on the duplicate jackpot payout document and the disbursement of the payment to the patron.
(iv) If a receipt document under paragraph (5) was issued, the duplicate receipt document shall be signed by the patron in the presence of the slot cashier. The slot cashier shall compare the signature on the duplicate receipt document to that on the original receipt document and make the payment only if the signatures are in agreement.
(v) Once payment has been made and the required signatures obtained, the slot cashier shall give the duplicate jackpot payout document to a security department member or slot attendant who shall expeditiously deposit it into a locked accounting box.
(vi) The slot cashier shall attach the request for jackpot payout document, if applicable, the original and duplicate receipt document, if applicable, to the original copy of the jackpot payout document. All documents shall be forwarded by the end of the gaming day to the main bank for reimbursement.
(9) A requirement that whenever a winning patron is paid by a slot attendant or slot attendant supervisor, the following procedures are followed:
(i) A jackpot payout document be generated by the slot computer system in accordance with paragraph (7).
(ii) The slot cashier shall disburse the cash or slot licensee check to a slot attendant or slot attendant supervisor if the amount of the jackpot is less than $10,000 and to a slot attendant supervisor if the amount of the jackpot is $10,000 or more. The employee receiving the payment shall verify the amount received and sign the original and duplicate of the jackpot payout document attesting to the accuracy of the information on the jackpot payout document and the receipt of the payment from the slot cashier. The slot cashier shall retain the original jackpot payout document and the duplicate jackpot payout document shall be transported with the payment to the slot machine.
(iii) If a one-part request for jackpot payout document is involved and a security department member or verifying slot attendant other than the preparer has not signed the one-part request for jackpot payout document, the slot attendant or slot attendant supervisor shall provide the duplicate jackpot payout document to the security department member or verifying slot attendant other than the preparer at the slot machine who shall verify that the winning combination of characters on the slot machine and the amount to be paid match those which appear on the duplicate jackpot payout document. If the jackpot amount is $ 25,000 or more, and the slot shift manager has not signed the request document, the slot shift manager shall similarly verify that the winning combination of characters on the slot machine and the amount to be paid match those which appear on the duplicate jackpot payout document.
(iv) Once the verifications required by subparagraph (iii) have been completed, if the payment is less than $10,000, the slot attendant or slot attendant supervisor shall pay the winning patron in the presence of the security department member or second slot attendant who verified the winning combination of characters on the slot machine and the amount to be paid. If the payment is $10,000 or more, but less than $25,000, the payment shall be made by a slot attendant supervisor in the presence of the security department member or verifying slot attendant who verified the winning combination of characters on the slot machine and the amount to be paid. If the payment is $25,000 or more, the payment shall be made by a slot attendant supervisor in the presence of the security department member or verifying slot attendant and the slot shift manager who verified the winning combination of characters on the slot machine and the amount to be paid. Once the patron has been paid, all personnel required by subparagraph (iii) to witness the payment shall sign the duplicate jackpot payout document attesting that the winning combination of characters on the slot machine and the amount to be paid match those which appear on the duplicate jackpot payout document and the disbursement of the payment to the winning patron.
(v) If a receipt document under paragraph (5) was issued, the slot cashier must give the slot attendant or slot attendant supervisor the original receipt document along with the duplicate jackpot payout document to be transported with the payment. The patron shall be required to sign the duplicate receipt document in the presence of the slot attendant or slot attendant supervisor. The slot attendant or supervisor shall compare the signature on the duplicate receipt document to that on the original receipt document and make the payment only if the signatures are in agreement.
(vi) Once payment has been made and the required signatures obtained, the security department member or slot attendant shall expeditiously deposit the duplicate jackpot payout document into a locked accounting box.
(vii) The slot attendant or slot attendant supervisor shall immediately return the original and duplicate receipt document, if applicable, to the cashiers' cage.
(viii) The slot cashier shall attach the request for jackpot payout document, if applicable, the original and duplicate receipt document, if applicable, to the original copy of the jackpot payout document. All documents shall be forwarded by the end of the gaming day to the main bank for reimbursement.
(10) A requirement that the slot machine licensee's accounting department perform, at the conclusion of each gaming day, effective income control audit procedures over the issuance of jackpot payouts including adequate comparisons to gaming voucher system data.
(11) Details with regard to processing of system overrides or adjustments.
(c) Nothing in this section precludes the use of a slot computer system, as approved by the Board, that electronically records the information required on a request for jackpot payout document or facilitates through the slot computer system the verifications and comparisons as to winning combination of characters on the slot machine or amount to be paid required under this section.
(d) Nothing in this section precludes a slot machine licensee from implementing procedures pursuant to which a slot attendant, in the presence of a member of the security department, utilizes an imprest inventory of funds secured in a pouch or wallet to pay a jackpot of less than $1,200 that is not totally and automatically paid directly from a slot machine.
(e) Prior to the payment of a jackpot payout under subsection (d), each slot machine licensee shall establish a comprehensive system of internal controls addressing this method of jackpot payout, the replenishment of the imprest pouch and the attendant reconciliation process. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
§ 465.28. Annuity jackpots.
(a) Definition. The following term, when used in this section, has the following meaning, unless the context clearly indicates otherwise:
Annuity jackpot--A slot machine jackpot pursuant to which a patron wins the right to receive fixed cash payments at specified intervals in the future.
(b) Annuity jackpots. A slot machine licensee offering an annuity jackpot payable over 10 years or more may offer a winning patron the option to be paid in a single cash payout, in lieu of the annuity jackpot, in an amount that is equal to the present value of the face amount of the jackpot payout as calculated in subsection (c).
(c) Cash payment option. The present value of the cash payout option on an annuity shall be determined by applying a discount rate to each of the future annuity jackpot payments, taking into consideration the number of years until each jackpot payment would otherwise have been received and adding to that amount the amount of the first cash payment that would otherwise have been received. For the purposes of this subsection, the discount rate must equal the United States Treasury constant maturity rate for 20 year United States government securities for the week ending prior to the date of the jackpot, as identified in the applicable H.15 Statistical Release issued by the Federal Reserve Board plus 0.5%.
(d) Restriction on annuity payout. A slot machine licensee may not offer an annuity jackpot payout unless:
(1) The terms and conditions of the annuity jackpot, including the effect on the calculation of the theoretical payout percentage, comply with the act, this subpart and technical standards on jackpot payouts approved by the Board.
(2) The Board has approved the specific offer of the annuity jackpot.
(e) Cash payout with an annuity jackpot. A cash payout made in connection with an annuity jackpot must be made in accordance with § 465.27 (relating to jackpot payouts).
(f) Internal controls. Prior to the payment of an annuity jackpot, each slot machine licensee shall establish a comprehensive system of internal controls addressing the payment of an annuity jackpot. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
(1) The internal control procedures developed and implemented by the slot machine licensee must include:
(i) Procedures to be followed by a winning patron to exercise a cash payout option.
(ii) Procedures with regard to the administration of the trust agreement established to insure the future cash payments due pursuant to the annuity jackpot award.
(iii) A requirement that the trustee for the trust fund established by the trust agreement be a slot machine licensee or, for a wide area progressive system offering an annuity jackpot, the slot system operator for that wide area progressive system.
(2) A slot machine licensee may not offer an annuity jackpot until its supporting trust agreement and the internal controls required under this subsection have been approved in writing by the Board.
§ 465.29. Merchandise jackpots.
(a) Definition. The following term, when used in this section, has the following meaning, unless the context clearly indicates otherwise:
Merchandise jackpot--A slot machine jackpot in the form of:
(i) Merchandise or a thing of value.
(ii) A cash payout and a payout of merchandise or a thing of value.
(iii) An option to choose between a cash payout and a payout of merchandise or a thing of value.
(b) Restriction. A slot machine licensee may not offer a merchandise jackpot payout unless:
(1) The terms and conditions of the merchandise jackpot, including the effect on the calculation of the theoretical payout percentage, comply with the act, this subpart and technical standards on jackpot payouts approved by the Board.
(2) The Board has approved the specific offer of the merchandise jackpot.
(c) Cash payout. Any cash payout made in connection with a merchandise jackpot must be made in accordance with § 465.27 (relating to jackpot payouts).
(d) Internal controls. Prior to the payment of a merchandise jackpot, each slot machine licensee shall establish a comprehensive system of internal controls addressing the payment of a merchandise jackpot. The internal controls shall be submitted to and approved by the Board under § 465.3 (relating to internal control systems and audit protocols).
§ 465.30. Automated teller machines.
Automated teller machines may be placed at any location within the licensed facility.
§ 465.31. Waiver of requirements.
The Board may waive one or more of the requirements of this chapter or technical standards applicable to accounting and internal controls adopted by the Board upon a determination that the nonconforming control or procedure nonetheless meets the operationally integrity requirements of the act, this subpart and technical standards adopted by the Board.
CHAPTER 467. COMMENCEMENT OF SLOT OPERATIONS Sec.
467.1. Gaming floor plan. 467.2. Commencement of slot operations generally. § 467.1. Gaming floor plan.
(a) Each applicant for, or holder of a slot machine license, shall submit to the Board, in a manner the Board requires, a floor plan of its gaming floor and the restricted areas servicing the slot operation. Each floor plan shall be drawn to 1/8 inch scale or other scale approved by the Board, shall be certified by an architect licensed to practice in this Commonwealth and depict the following:
(1) The gaming floor with notations as to:
(i) Proposed total square footage.
(ii) The perimeter of the gaming floor.
(iii) A clearly delineated route for underage persons to transverse the gaming floor.
(2) Each slot machine area on the gaming floor and each slot machine location within each slot machine area. Slot machine locations shall be identified by number in accordance with § 463.3 (relating to slot machine location).
(3) The number of slot machines on the gaming floor, in total and by slot area. The number must be in compliance with section 1210 of the act (relating to number of slot machines).
(4) Each slot seat on the gaming floor in compliance with § 461.7(t) (relating to slot machine minimum design standards).
(5) Each surveillance camera installed in compliance with § 465.10(a) (relating to surveillance system; surveillance department control, surveillance department restrictions), noting its type and camera number.
(6) The cashiers' cage and any satellite cashiers' cage, inclusive of each cashiers' cage window and window number, ancillary offices and areas.
(7) Each count room and any trolley storage area.
(8) Each automated bill breaker, gaming voucher redemption, coupon redemption and jackpot payout machine.
(9) Each automated teller machine.
(10) Each area designated for the storage or repair of slot machines.
(11) Vault and armored car bay locations.
(12) Additional documentation as requested by the Board.
(b) A slot machine licensee may not commence slot operations until the floor plan depicting its gaming floor and all restricted areas servicing the slot operation has been approved in writing by the Board. The approval by the Board will expressly authorize the maximum square footage of gaming floor and maximum number of slot machines which may be operated by the slot machine licensee.
(c) A slot machine licensee may not change or revise the square footage of its gaming floor or the number of slot machines on the floor plan approved under subsection (b) without prior written approval of the Board.
§ 467.2. Commencement of slot operations generally.
(a) In addition to obtaining a slot machine license, prior to the commencement of slot operations at a licensed facility each slot machine licensee shall demonstrate that:
(1) The licensed facility, including the gaming floor and the restricted areas servicing the slot operation, complies in all respects with the act, this subpart and technical standards adopted by the Board.
(2) Slot machines and associated equipment installed in the licensed facility and utilized in the conduct of slot machine operations have been tested and approved by the Board in compliance with the act, this subpart and technical standards adopted by the Board.
(3) The gaming floor plan required under § 467.1(a) (relating to gaming floor plan) has been approved by the Board in compliance with the act, this subpart and technical standards adopted by the Board.
(4) The slot machine licensee's proposed site plan and internal control systems and audit protocols have been approved by the Board in compliance with the act, this subpart and technical standards adopted by the Board.
(5) The slot machine licensee is prepared to implement necessary management controls, surveillance and security precautions to insure the efficient conduct of slot operations.
(6) The slot machine licensee's employees are licensed and trained in the performance of their responsibilities.
(7) The slot machine licensee has complied with any conditions prerequisite to commencement of slot operations contained in the Statement of Conditions executed under § 423.3 (relating to license issuance and statement of conditions).
(8) The licensed facility is prepared in all respects to receive the public.
(9) The slot machine licensee has successfully completed a test period in accordance with the terms and conditions required by the Board.
(b) Upon a slot machine licensee's successful demonstration of the criteria enumerated in subsection (a), the Board may authorize the date and time at which the slot machine licensee may commence slot operations at the licensed facility and will fix the maximum square footage of gaming floor and maximum number of slot machines which may be operated by the slot machine licensee pursuant to that authorization.
[Pa.B. Doc. No. 06-1317. Filed for public inspection July 21, 2006, 9:00 a.m.]
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