8880.24. Powers and Duties of the Commission
(a) The California State Lottery Commission shall exercise all
powers necessary to effectuate the purposes of this chapter. In all
decisions, the commission shall take into account the particularly
sensitive nature of the California State Lottery and shall act to
promote and ensure integrity, security, honesty, and fairness in the
operation and administration of the Lottery.
(b) In decisions relating to advertising and promotion of the
California State Lottery, the commission shall ensure that the
California State Lottery complies with both the letter and spirit of
the laws governing false and misleading advertising, including
Section 17500 et seq. of the Business and Professions Code. The
commission shall also ensure that the overall estimated odds of
winning some prize or prizes in a particular lottery game are posted
on all television and print advertising, exclusive of outdoor
advertising displays, signs, or banners, related to that game.
8880.25. Operation of the Lottery
The Lottery shall be initiated and operated so as to produce the
maximum amount of net revenues to supplement the total amount of
money allocated for public education in California.
8880.25.5. (a) Notwithstanding any other provision of law, the
Lottery Commission may do all of the following:
(1) Purchase and sell assets in its own name.
(2) Invest funds on deposit in the State Lottery Fund within or
outside the State Treasury system.
(3) Purchase and sell securities, including entering into bond
purchase agreements with the state to purchase state general
obligation bonds, or invest in other evidence of indebtedness issued
by the state, including, but not limited to, notes issued pursuant to
Part 5 (commencing with Section 17300) of Division 4 or warrants
issued pursuant to Part 4 (commencing with Section 17000) of Division
4.
(b) The bonds or other evidence of indebtedness specified in
subdivision (a), upon delivery to the Lottery Commission, shall, for
all purposes, be valid and binding obligations of the issuer thereof,
be validly issued and outstanding in accordance with their stated
terms, and shall not be deemed to be owned by or on behalf of the
issuer thereof.
8880.26. (a) The provisions of Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 are not applicable to any rule or
regulation promulgated by the commission.
(b) Section 2889 of the Public Utilities Code shall not be
applicable to any live, recorded, or recorded-interactive audio text
access telephone service under contract to the commission, as of the
effective date of the act adding this subdivision, that provides the
public with lottery game draw results.
(c) The provisions of the Public Contract Code shall not apply to
expenditures made by the lottery in furtherance of its duty to
produce the maximum amount of net revenues.
8880.27. Meetings with the Director
The Commission shall meet with the Director not less than once
each quarter to make recommendations and set policy, to approve or
reject reports of the Director and transact such other business that
may be properly brought before it.
8880.28. (a) The commission shall promulgate regulations specifying
the types of lottery games to be conducted by the lottery, provided:
(1) No lottery game may use the theme of roulette, dice, baccarat,
blackjack, Lucky 7s, draw poker, slot machines, or dog racing.
(2) In lottery games utilizing tickets, each ticket in these games
shall bear a unique number distinguishing it from every other ticket
in that game; and no name of an elected official shall appear on
these tickets.
(3) In games utilizing computer terminals or other devices, no
coins or currency shall be dispensed as prizes to players from these
computer terminals or devices.
(b) Notwithstanding subdivision (a), no changes in the types of
games or methods of delivery of these games that incorporate
technologies or mediums that did not exist, were not widely
available, or were not commercially feasible at the time of the
enactment of this chapter in 1984 shall be made, unless all of the
following conditions are met:
(1) This chapter is amended by statute to expressly authorize
these changes.
(2) The act making the amendments contains express legislative
findings that the amendments are consistent with the terms of, and
further the purposes of, this chapter.
(3) The amendments comport with applicable state and federal law.
(c) For purposes of this section, a change in the method of
delivery means a material change in the way a consumer directly
interacts with the game.
(d) Subdivision (b) does not apply to technological changes
implemented prior to October 11, 1993.
(e) This section does not limit any internal technological changes
made to the equipment or components utilized by the lottery.
8880.29. (a) The commission shall promulgate regulations that
specify the number and value of prizes for winning tickets or shares
in each lottery game including, without limitation, cash prizes,
merchandise prizes, prizes consisting of deferred payments or
annuities, and prizes of tickets or shares in the same lottery game
or other games conducted by the lottery, provided:
(1) In lottery games utilizing tickets, the overall estimated odds
of winning some prize or some cash prize as appropriate for the
lottery game shall be printed on each ticket or on a play slip.
(2) A detailed tabulation of the estimated number of prizes of
each particular prize denomination that are expected to be awarded in
each lottery game, or the estimated odds of winning the prizes,
shall be available at each location at which tickets or shares in the
lottery games are offered for sale to the public.
(b) Annuity contracts that are purchased for prizes shall be
exempt from the requirements of Section 8880.57.
8880.30. The commission shall promulgate regulations that specify
the method for determining winners in each lottery game, provided:
(a) A lottery game may be based on the results of a horse race
with the consent of the association conducting the race and the
California Horse Racing Board. Any compensation received by an
association for the use of its races to determine the winners of a
lottery game shall be divided equally between commissions and purses.
(b) If a lottery game utilizes a drawing of winning numbers, a
drawing among entries, or a drawing among finalists, the drawings
shall always be open to the public. No manual or physical selection
in the drawings shall be conducted by any employee of the Lottery.
Except for computer automated drawings, drawings shall be witnessed
by an independent lottery contractor having qualifications
established by the commission. Any equipment used in the drawings
shall be inspected by the independent lottery contractor and an
employee of the Lottery both before and after the drawings. The
drawings and the inspections shall be both audio and video recorded.
(c) It is the intent of this chapter that the commission may use
any of a variety of existing or future methods or technologies in
determining winners.
8880.31. Sale Price of Tickets and Shares
The Commission shall promulgate rules and regulations specifying
the retail sales price for each ticket or share for each Lottery
Game, provided:
(a) Except as provided in subdivision (b), no ticket or share
shall be sold for more or less than the retail sales price
established by the Commission.
(b) The retail price of each ticket or share in any Lottery Game
conducted by the Lottery shall be at least one dollar ($1), except to
the extent of any discounts authorized by the Commission.
8880.321. The commission shall promulgate regulations to establish
a system of verifying the validity of prizes and to effect payment of
the prizes, provided that:
(a) For convenience of the public, lottery game retailers may be
authorized by the commission to pay winners of up to six hundred
dollars ($600) after performing validation procedures on their
premises appropriate to the lottery game involved.
(b) No prize may be paid arising from tickets or shares that are
stolen, counterfeit, altered, fraudulent, unissued, produced or
issued in error, unreadable, not received or not recorded by the
lottery by applicable deadlines, lacking in captions that confirm and
agree with the lottery play symbols required by the lottery game
involved, purchased by a minor, or not in compliance with additional
specific rules and regulations and confidential validation and
security tests appropriate to the particular lottery game. The
lottery may pay a prize even though the actual winning ticket is not
received by the lottery if the lottery validates the claim for the
prize based upon substantial proof. "Substantial proof" means any
evidence that would permit the lottery to use established validation
procedures, as specified in lottery regulations, to validate the
claim.
The commission may require that any form relating to a claim for a
prize shall be signed under penalty of perjury. This declaration
shall meet the requirements of Section 2015.5 of the Code of Civil
Procedure.
(c) No particular prize in any lottery game shall be paid more
than once.
(d) The commission may specify that winners of less than
twenty-five dollars ($25) claim the prizes from either the same
lottery game retailer from whom the ticket or share was purchased or
from the lottery itself.
(e) Players shall have the right to claim prize money for 180 days
after the drawing or the end of the lottery game or play in which
the prize was won, or, if a multistate lottery game, up to one year
for jackpots and grand prizes. The commission may define shorter time
periods for eligibility for participation in, and entry into,
drawings involving entries or finalists. If a valid claim is not made
for a prize directly payable by the commission or for any online
game prize within the period applicable for that prize, the unclaimed
prize money shall be treated as set forth in subdivision (a) of
Section 8880.4 or, commencing with the 2009-10 fiscal year, be
treated as total revenues as set forth in Section 8880.4.5.
(f) After the expiration of the claim period for prizes for each
lottery game, the commission shall make available a detailed
tabulation of the total number of tickets or shares actually sold in
a lottery game and the total number of prizes of each prize
denomination that were actually claimed and paid directly by the
commission.
(g) A ticket or share shall not be purchased by, and a prize shall
not be paid to, a member of the commission, any officer or employee
of the commission, any officer or employee of the Controller who is
designated in writing by the Controller as having possible access to
confidential lottery information, programs, or systems, or any
spouse, child, brother, sister, or parent of that person who resides
within the same household of the person. Any person who knowingly
sells or purchases a ticket or share in violation of this section, or
who knowingly claims or attempts to claim a prize with a ticket or
share that was purchased or sold in violation of this section, is
guilty of a misdemeanor.
(h) No prize shall be paid to any person under the age of 18
years. Any person who knowingly claims or attempts to claim a prize
with a ticket or share purchased by a person under the age of 18
years is guilty of a misdemeanor.
8880.325. The right of any person to a prize shall not be
assignable, except that the payment of any prize may be assigned, in
whole or in part, as provided by Section 8880.326 and this section
under any of the following circumstances:
(a) An assignment executed by the prizewinner on a form approved
by, and filed with, the commission during the prizewinner's lifetime
in accordance with regulations adopted by the commission, to a trust
that by its terms is revocable and that is established by the
prizewinner for the benefit of the prizewinner as a beneficiary and
governed by the laws of the state.
(b) An appropriate judicial order appointing a conservator or a
guardian for the protection of the prizewinner or for adjudicating
rights to, or ownership of, the prize.
(c) An assignment, as collateral, to a person to secure a loan
pursuant to Division 9 (commencing with Section 9101) of the
Commercial Code. The assignment as collateral of the right to receive
payment of a prize shall be subject to all of the following:
(1) All security agreements, rights of the prizewinner, and rights
of the secured creditor shall be determined pursuant to the laws of
the state.
(2) In the event of a default under the loan or security
agreement, the secured creditor's rights shall be limited to
receiving the regular payments made by the lottery, based on the
prizewinner's right to receive a regular prize payment until the
obligation has been paid in full or the prize has been paid in full,
whichever occurs first. Notwithstanding Division 9 (commencing with
Section 9101) of the Commercial Code, the secured creditor shall not
have the right to sell or assign the prizewinner's rights to payments
to itself or to any other person. This section shall not limit the
secured creditor's right to sell, assign, or transfer the obligation
of the debtor and related security interest to a third party.
(3) The prizewinner and secured creditor may agree, and may
jointly instruct the lottery, to directly deposit all prizewinning
payments into an account maintained by the prizewinner at a federally
insured financial institution located within the state. This account
may be subject to the secured creditor's lien. Upon receipt of these
instructions, the lottery shall continue to deposit all payments due
the prizewinner into the account until the lottery receives
notification from both the secured creditor and the prizewinner that
the payments are to be made to an account maintained at another bank
or that the secured creditor releases or terminates the security
interest in the prizewinner's payments.
(4) (A) The prizewinner, pursuant to an order of the court
obtained in compliance with subdivision (d), may direct the lottery
to make the prize payments, in whole or in part, directly to the
secured creditor. A direction to the lottery to make a prize payment
to a secured creditor shall not, in itself, constitute an assignment
of the prize payment to the secured creditor.
(B) For purposes of this paragraph and subdivision (d), "assignee"
and "secured creditor" are synonymous, and "assignment" or "prize
payment" means the payment that is directed to be paid to the secured
creditor.
(5) For purposes of perfecting the security interest of the
secured creditor, the right of the prizewinner to receive payments is
deemed to be a contract right that is perfected by the filing of a
financing statement with the office of the Secretary of State.
(6) A copy of the security agreement, an endorsed copy of the
financing statement, and the joint instruction to deposit the
prizewinner's payments directly into an account, if any, at the
financial institution shall be filed with the lottery.
Notwithstanding the security interest granted a creditor, all lottery
payments shall be made payable directly to the prizewinner, except
as follows:
(A) Payments sent directly to the financial institution designated
pursuant to paragraph (3).
(B) In the event of a default under the security agreement or
obligation it secures, payments sent directly to the secured creditor
pursuant to an order of a court of competent jurisdiction
determining that the payments are to be made directly to the secured
creditor.
(7) Upon the termination or release of the security interest, the
secured creditor shall file an endorsed copy of the release or
termination of the security interest with the lottery.
(d) Except as provided in subdivision (j), an assignment of future
payments to another person designated pursuant to an appropriate
judicial order of a California superior court or a federal court
having jurisdiction over property located within California, if the
court determines and states in its order all of the following:
(1) That the prizewinner was represented by independent legal
counsel whose name and State Bar of California number appears as
counsel of record on all pleadings filed in any and all court
proceedings. The prizewinner's legal counsel shall appear as counsel
of record at any proceedings that are required by the court.
(2) That the prizewinner has represented to the court either by
sworn testimony if a personal appearance is required by the court, or
by written declaration filed with the court under penalty of
perjury, and that the court has determined these representations to
be true and correct, that the prizewinner (A) has reviewed and
understands the terms and effects of the assignment, (B) understands
that he or she will not receive the prize payments or portions
thereof for the years assigned, (C) has entered into the agreement of
his or her own free will without undue influence or duress and not
under the influence of drugs or alcohol, (D) has had an opportunity
to retain independent financial and tax advice, and (E) has been
represented by independent legal counsel, who has advised the
prizewinner of his or her legal rights and obligations under the
assignment.
(3) It shall be the responsibility of the prizewinner to bring to
the attention of the court, either by sworn testimony or by written
declaration submitted under penalty of perjury, the existence or
nonexistence of a current spouse. If married, the prizewinner shall
identify his or her spouse and submit to the court a signed and
notarized statement wherein the spouse consents to the assignment. If
the prizewinner is married and the notarized statement is not
presented to the court, the court shall determine, to the extent
necessary and as appropriate under applicable law, the ability of the
prizewinner to make the proposed assignment without the spouse's
consent.
(4) The specific prize payment or payments assigned, or any
portion thereof, including the dates and amounts of the payments to
be assigned, the years in which each payment is to begin and end, the
gross amount of the annual payments assigned before taxes, the
prizewinner's name as it appears on the lottery claim form, the full
legal name of the assignor if different than the prizewinner's name
as it appears on the lottery claim form, the assignor's social
security or tax identification number, the assignee's full legal name
and social security or tax identification number, and, if
applicable, the citizenship or resident alien number of the assignee
if a natural person.
(5) Expressly identifies the amount, the date if available, any
nonspouse coowner, claimant, or lienholder, and the interests, liens,
security interests, assignments, or offsets asserted by the state or
other persons against any of the prize payments, including, but not
limited to, those payments that are the subject of the proposed
assignment as those interests, liens, security interests,
assignments, or offsets have been represented to the court by the
prizewinner in a written declaration signed under penalty of perjury
and filed with the court.
(6) That the lottery and the State of California are not parties
to the proceeding and that the lottery and the state may rely upon
the order in disbursing the prize payments that are the subject of
the order. Further, that upon payment of prize moneys pursuant to an
order of the court, the lottery, the director, the commission, and
the employees of the lottery and the state shall be discharged of any
and all liability for the prize paid, and these persons and entities
shall have no duty or obligation to any person asserting another
interest in, or right to receive, the prize payment.
(7) That the prizewinner or the proposed assignee has obtained and
filed with the court a notification from the lottery of any liens,
levies, or claims, and the Controller's office of any offsets
asserted as of that time against the prizewinner, as reflected in
their respective official records as of the time of the notification.
The date of the notification shall not be more than 20 days prior to
the court hearing, unless extended by the court.
(e) The assignment of the right to receive any prize payment or
payments by the prizewinner pursuant to subdivision (d) shall be
conditioned on the following terms, conditions, and rights, which may
not be waived or modified by the prizewinner:
(1) The payment of moneys to, or on behalf of, the prizewinner by
the assignee in consideration for the assignment of the prize payment
or payments shall be made in full prior to the time when, under the
terms of the assignment, the lottery is required to make the first
prize payment to the assignee, or may be made in two installments,
the first being paid prior to the time when, under the terms of the
assignment, the lottery is required to make the first prize payment
to the assignee and the second installment within 11 months
thereafter. The second installment shall not be in an amount that
exceeds the first installment. Notwithstanding the foregoing, any
other installment payment schedule is permitted if the installment
obligation relating to the installments is guaranteed by a financial
institution, as defined in paragraph (2) of subdivision (a) of
Section 4981 of the Financial Code, or a brokerage firm that is a
member of the Securities Investor Protection Corporation (SIPC), as
required by the federal Securities Investor Protection Act of 1970
(15 U.S.C. Sec. 78aaa et seq.).
(2) If the prizewinner elects to accept the consideration to be
paid for the assignment in two installments as provided in paragraph
(1), the prizewinner shall have a special lien for the balance of any
payment due, effective without any further action, agreement, or
notice, on any of the prize payments assigned by the prizewinner for
the payment of moneys from the assignee. This lien shall terminate
upon the prizewinner receiving actual payment of the moneys. The
tendering of a check, payment instrument, or recital of payment shall
not constitute actual payment of moneys for the purposes of this
paragraph. Notwithstanding the foregoing, if a prizewinner accepts an
installment obligation guaranteed by a Federal Deposit Insurance
Corporation (FDIC) or SIPC insured entity, then the lien created by
this section shall automatically terminate upon delivery of the
installment obligation.
(3) The Legislature finds and declares that the creation of a
statutory lien in favor of a prizewinner is necessary to protect the
rights of the prizewinner from any creditors, subsequent bankruptcy
trustees of the assignee, or from any subsequent assignees when the
prizewinner has not received full payment for the assigned prize
payments.
(f) Prior to the assignment of any prize as provided in
subdivisions (c) and (d), the Controller shall determine whether the
prizewinner owes any obligation that is subject to offset under
Article 2 (commencing with Section 12410) of Chapter 5 of Part 2 of
Division 3 and shall provide written notification of that
determination to the lottery and to the Secretary of State.
(g) If the lottery determines that the court order issued pursuant
to subdivision (d) is complete and correct in all respects, the
lottery shall send the prizewinner and the assignee or assignees
written confirmation of receipt of the court-ordered assignment and
of the lottery's intention to rely thereon in making future payments
to the assignee or assignees named in the court order.
(h) Notwithstanding any other provision of law, by entering into
an agreement to assign any prize payments pursuant to subdivision (c)
or (d), a prizewinner shall be deemed to have waived any statutory
period of limitation as to the State of California enforcing any
rights against annual prize payments due after the last assigned
payment is paid or released, if assigned as collateral, from the lien
granted the secured creditor. No assignment of prize payments
pursuant to either subdivision (c) or (d) shall be valid or allowed
for the final three annual prize payments from the lottery to the
prizewinner.
(i) Any loans made to a prizewinner pursuant to this section shall
be exempt from the usury provisions of Article XV of the California
Constitution with respect to an assignment of a lottery prize as
collateral to secure a loan.
(j) (1) Notwithstanding any other provision of this section, no
prizewinner shall have the right to assign prize payments pursuant to
subdivision (d) or direct the payment of a prize pursuant to
paragraph (4) of subdivision (c) if any of the following occurs:
(A) The issuance by the United States Internal Revenue Service
(IRS) of a technical rule letter, revenue ruling, or other public
ruling of the IRS in which the IRS determines that, based upon the
right of assignment provided in subdivision (d), a California lottery
prizewinner who does not assign any prize payments pursuant to
subdivision (d) would be subject to an immediate income tax liability
for the value of the entire prize rather than annual income tax
liability for each installment when paid.
(B) The issuance by a court of competent jurisdiction of a
published decision holding that, based upon the right of assignment
provided in subdivision (d), a California lottery prizewinner who
does not assign any prize payments pursuant to subdivision (d) would
be subject to an immediate income tax liability for the value of the
entire prize rather than annual income tax liability for each
installment when paid.
(2) Upon receipt of a letter or ruling from the IRS or a published
decision of a court of competent jurisdiction, as specified in
paragraph (1), the director shall immediately file a copy of that
letter, ruling, or published decision with the Secretary of State.
Immediately upon the filing by the director of a letter, ruling,
or published decision with the Secretary of State, a prizewinner
shall be ineligible to assign a prize pursuant to subdivision (d) or
direct the payment of a prize pursuant to paragraph (4) of
subdivision (c).
8880.326. Upon the death of the prizewinner, the prize may be paid
by any of the following methods:
(a) To the trustee of a trust established pursuant to subdivision
(a) of Section 8880.325, or, if the trust has been terminated, to
those beneficiaries entitled to distribution under Section 8880.325.
(b) To one or more beneficiaries designated on a form approved by
the commission for that purpose, executed by the prizewinner, filed
with the commission in accordance with regulations adopted by the
commission to govern those designations, and in effect upon the
prizewinner's death.
(c) In the absence of an assignment to a trust or a beneficiary
designation, the prizewinner's prize may be paid, as follows:
(1) To the personal representative of the testate or intestate
estate of a deceased prizewinner upon receipt by the commission of a
court order and letters appointing an executor, administrator, or
other personal representative of the estate of the deceased
prizewinner, or pursuant to a final order of distribution.
(2) As provided under Part 1 (commencing with Section 13000) or
Part 2 (commencing with Section 13500) of Division 8 of the Probate
Code.
(3) To a person or persons designated under an appropriate
judicial order adjudicating rights to the ownership of the prize.
8880.327. For any assignments, transfers, or security interests
provided for in Sections 8880.325 and 8880.326, the following shall
apply:
(a) The commission may establish a reasonable fee for all expenses
incurred in order to comply with Section 8880.325 or 8880.326
relating to an authorized assignment, transfer, or security interest.
The fee may be deducted from the prize moneys paid by the lottery
pursuant to Section 8880.325 or 8880.326.
(b) Upon the payment of prize moneys pursuant to Section 8880.325
or 8880.326 or an order of a court, the lottery, the director, the
commission, and the employees of the lottery and the state shall be
discharged of any and all liability for the prize paid, and they
shall have no duty or obligation to any persons asserting another
interest in, or right to receive, the prize payment.
(c) The commission shall adopt regulations necessary to implement
Section 8880.325 or 8880.326 allowing for a limited right of
prizewinners to assign their rights to prize payments and setting the
reasonable fee for expenses to be recovered by the lottery. The
regulations shall be consistent with and shall further the
Legislature's intent that prizewinners who wish to do so should be
afforded the opportunity to currently enjoy more of their winnings as
provided by Section 1 of Chapter 890 of the Statutes of 1994. If the
commission deems it necessary, the regulations may require, as a
condition to any voluntary assignment pursuant to subdivision (d) of
Section 8880.325, that the prizewinner be represented by independent
legal counsel and receive independent financial and tax advice
concerning the effect of the assignment.
8880.33. (a) The commission shall promulgate regulations specifying
the manner of distribution, dissemination, or sale of lottery
tickets or shares to lottery game retailers or directly to the
public, and the incentives, if any, for lottery employees engaged in
the distribution or sales activities.
(b) The commission shall also make available upon request to
lottery game retailers a model agreement to govern the division of
prizes among multiple purchasers of a winning ticket or tickets
purchased through a group purchase or pooling arrangement.
8880.335. The commission may promulgate regulations to authorize
the use of an electronic or electromechanical device to dispense
lottery tickets to be used in the play of any lottery game, if the
device satisfies all of the following specifications:
(a) The lottery ticket dispenser dispenses a paper or cardboard
ticket that provides the purchaser of the ticket with an opportunity
to win a prize in a lottery game, and the ticket fits one of the
following descriptions:
(1) The ticket has an ascertainable prize value, including a null
prize value or an opportunity to enter another lottery game at the
time it is dispensed, provided that the prize value of the ticket may
be revealed to the purchaser of the ticket only after the purchaser
has removed the ticket from the dispenser and only by physically
removing a covering that hides numbers or symbols that are imprinted
on the ticket.
(2) The ticket has no value at the time it is dispensed, except
for restitution of the purchase price, but may acquire a redemption
value as the result of a draw that occurs after the ticket is
dispensed.
(b) If the lottery ticket dispenser dispenses tickets described in
paragraph (1) of subdivision (a), then neither the operation or
functioning of the ticket dispenser nor the operation or functioning
of any component, subcomponent, part, chip, or program of the ticket
dispenser, or of any device in direct or indirect communication with
the ticket dispenser, may affect the probability that a ticket that
is dispensed will have a prize value other than a null prize value.
(c) If a lottery ticket dispenser includes any component,
subcomponent, mechanism, or feature that is capable of generating
numbers or symbols for use in the play of a lottery game, or if the
lottery ticket dispenser communicates directly or indirectly with any
device that includes any component, subcomponent, mechanism, or
feature that is capable of generating numbers or symbols for use in
the play of a lottery game, that component, subcomponent, mechanism,
or feature may be used only in the production and dispensing of
lottery tickets described in paragraph (2) of subdivision (a).
(d) A lottery ticket dispenser that dispenses tickets described in
paragraph (2) of subdivision (a) shall not also be the device used
in the subsequent draw to determine winning tickets and shall not be
capable of causing, directly or indirectly, the operation of any
device used in the subsequent draw to determine winning tickets.
(e) The lottery ticket dispenser shall not make change or
otherwise dispense coins, currency, or any thing of value other than
a lottery ticket.
(f) No lottery ticket dispenser that utilizes a television monitor
or video screen shall display or reproduce the image or facsimile
of, or any other visual representation of, a lottery ticket that will
be or has been dispensed or issued from that lottery ticket
dispenser. Nothing herein shall preclude the use of television
monitors or video screens to transmit messages about lottery games
and game results, if those messages are not generated by the lottery
ticket dispenser.
8880.24. Powers and Duties of the Commission
(a) The California State Lottery Commission shall exercise all
powers necessary to effectuate the purposes of this chapter. In all
decisions, the commission shall take into account the particularly
sensitive nature of the California State Lottery and shall act to
promote and ensure integrity, security, honesty, and fairness in the
operation and administration of the Lottery.
(b) In decisions relating to advertising and promotion of the
California State Lottery, the commission shall ensure that the
California State Lottery complies with both the letter and spirit of
the laws governing false and misleading advertising, including
Section 17500 et seq. of the Business and Professions Code. The
commission shall also ensure that the overall estimated odds of
winning some prize or prizes in a particular lottery game are posted
on all television and print advertising, exclusive of outdoor
advertising displays, signs, or banners, related to that game.
8880.25. Operation of the Lottery
The Lottery shall be initiated and operated so as to produce the
maximum amount of net revenues to supplement the total amount of
money allocated for public education in California.
8880.25.5. (a) Notwithstanding any other provision of law, the
Lottery Commission may do all of the following:
(1) Purchase and sell assets in its own name.
(2) Invest funds on deposit in the State Lottery Fund within or
outside the State Treasury system.
(3) Purchase and sell securities, including entering into bond
purchase agreements with the state to purchase state general
obligation bonds, or invest in other evidence of indebtedness issued
by the state, including, but not limited to, notes issued pursuant to
Part 5 (commencing with Section 17300) of Division 4 or warrants
issued pursuant to Part 4 (commencing with Section 17000) of Division
4.
(b) The bonds or other evidence of indebtedness specified in
subdivision (a), upon delivery to the Lottery Commission, shall, for
all purposes, be valid and binding obligations of the issuer thereof,
be validly issued and outstanding in accordance with their stated
terms, and shall not be deemed to be owned by or on behalf of the
issuer thereof.
8880.26. (a) The provisions of Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 are not applicable to any rule or
regulation promulgated by the commission.
(b) Section 2889 of the Public Utilities Code shall not be
applicable to any live, recorded, or recorded-interactive audio text
access telephone service under contract to the commission, as of the
effective date of the act adding this subdivision, that provides the
public with lottery game draw results.
(c) The provisions of the Public Contract Code shall not apply to
expenditures made by the lottery in furtherance of its duty to
produce the maximum amount of net revenues.
8880.27. Meetings with the Director
The Commission shall meet with the Director not less than once
each quarter to make recommendations and set policy, to approve or
reject reports of the Director and transact such other business that
may be properly brought before it.
8880.28. (a) The commission shall promulgate regulations specifying
the types of lottery games to be conducted by the lottery, provided:
(1) No lottery game may use the theme of roulette, dice, baccarat,
blackjack, Lucky 7s, draw poker, slot machines, or dog racing.
(2) In lottery games utilizing tickets, each ticket in these games
shall bear a unique number distinguishing it from every other ticket
in that game; and no name of an elected official shall appear on
these tickets.
(3) In games utilizing computer terminals or other devices, no
coins or currency shall be dispensed as prizes to players from these
computer terminals or devices.
(b) Notwithstanding subdivision (a), no changes in the types of
games or methods of delivery of these games that incorporate
technologies or mediums that did not exist, were not widely
available, or were not commercially feasible at the time of the
enactment of this chapter in 1984 shall be made, unless all of the
following conditions are met:
(1) This chapter is amended by statute to expressly authorize
these changes.
(2) The act making the amendments contains express legislative
findings that the amendments are consistent with the terms of, and
further the purposes of, this chapter.
(3) The amendments comport with applicable state and federal law.
(c) For purposes of this section, a change in the method of
delivery means a material change in the way a consumer directly
interacts with the game.
(d) Subdivision (b) does not apply to technological changes
implemented prior to October 11, 1993.
(e) This section does not limit any internal technological changes
made to the equipment or components utilized by the lottery.
8880.29. (a) The commission shall promulgate regulations that
specify the number and value of prizes for winning tickets or shares
in each lottery game including, without limitation, cash prizes,
merchandise prizes, prizes consisting of deferred payments or
annuities, and prizes of tickets or shares in the same lottery game
or other games conducted by the lottery, provided:
(1) In lottery games utilizing tickets, the overall estimated odds
of winning some prize or some cash prize as appropriate for the
lottery game shall be printed on each ticket or on a play slip.
(2) A detailed tabulation of the estimated number of prizes of
each particular prize denomination that are expected to be awarded in
each lottery game, or the estimated odds of winning the prizes,
shall be available at each location at which tickets or shares in the
lottery games are offered for sale to the public.
(b) Annuity contracts that are purchased for prizes shall be
exempt from the requirements of Section 8880.57.
8880.30. The commission shall promulgate regulations that specify
the method for determining winners in each lottery game, provided:
(a) A lottery game may be based on the results of a horse race
with the consent of the association conducting the race and the
California Horse Racing Board. Any compensation received by an
association for the use of its races to determine the winners of a
lottery game shall be divided equally between commissions and purses.
(b) If a lottery game utilizes a drawing of winning numbers, a
drawing among entries, or a drawing among finalists, the drawings
shall always be open to the public. No manual or physical selection
in the drawings shall be conducted by any employee of the Lottery.
Except for computer automated drawings, drawings shall be witnessed
by an independent lottery contractor having qualifications
established by the commission. Any equipment used in the drawings
shall be inspected by the independent lottery contractor and an
employee of the Lottery both before and after the drawings. The
drawings and the inspections shall be both audio and video recorded.
(c) It is the intent of this chapter that the commission may use
any of a variety of existing or future methods or technologies in
determining winners.
8880.31. Sale Price of Tickets and Shares
The Commission shall promulgate rules and regulations specifying
the retail sales price for each ticket or share for each Lottery
Game, provided:
(a) Except as provided in subdivision (b), no ticket or share
shall be sold for more or less than the retail sales price
established by the Commission.
(b) The retail price of each ticket or share in any Lottery Game
conducted by the Lottery shall be at least one dollar ($1), except to
the extent of any discounts authorized by the Commission.
8880.321. The commission shall promulgate regulations to establish
a system of verifying the validity of prizes and to effect payment of
the prizes, provided that:
(a) For convenience of the public, lottery game retailers may be
authorized by the commission to pay winners of up to six hundred
dollars ($600) after performing validation procedures on their
premises appropriate to the lottery game involved.
(b) No prize may be paid arising from tickets or shares that are
stolen, counterfeit, altered, fraudulent, unissued, produced or
issued in error, unreadable, not received or not recorded by the
lottery by applicable deadlines, lacking in captions that confirm and
agree with the lottery play symbols required by the lottery game
involved, purchased by a minor, or not in compliance with additional
specific rules and regulations and confidential validation and
security tests appropriate to the particular lottery game. The
lottery may pay a prize even though the actual winning ticket is not
received by the lottery if the lottery validates the claim for the
prize based upon substantial proof. "Substantial proof" means any
evidence that would permit the lottery to use established validation
procedures, as specified in lottery regulations, to validate the
claim.
The commission may require that any form relating to a claim for a
prize shall be signed under penalty of perjury. This declaration
shall meet the requirements of Section 2015.5 of the Code of Civil
Procedure.
(c) No particular prize in any lottery game shall be paid more
than once.
(d) The commission may specify that winners of less than
twenty-five dollars ($25) claim the prizes from either the same
lottery game retailer from whom the ticket or share was purchased or
from the lottery itself.
(e) Players shall have the right to claim prize money for 180 days
after the drawing or the end of the lottery game or play in which
the prize was won, or, if a multistate lottery game, up to one year
for jackpots and grand prizes. The commission may define shorter time
periods for eligibility for participation in, and entry into,
drawings involving entries or finalists. If a valid claim is not made
for a prize directly payable by the commission or for any online
game prize within the period applicable for that prize, the unclaimed
prize money shall be treated as set forth in subdivision (a) of
Section 8880.4 or, commencing with the 2009-10 fiscal year, be
treated as total revenues as set forth in Section 8880.4.5.
(f) After the expiration of the claim period for prizes for each
lottery game, the commission shall make available a detailed
tabulation of the total number of tickets or shares actually sold in
a lottery game and the total number of prizes of each prize
denomination that were actually claimed and paid directly by the
commission.
(g) A ticket or share shall not be purchased by, and a prize shall
not be paid to, a member of the commission, any officer or employee
of the commission, any officer or employee of the Controller who is
designated in writing by the Controller as having possible access to
confidential lottery information, programs, or systems, or any
spouse, child, brother, sister, or parent of that person who resides
within the same household of the person. Any person who knowingly
sells or purchases a ticket or share in violation of this section, or
who knowingly claims or attempts to claim a prize with a ticket or
share that was purchased or sold in violation of this section, is
guilty of a misdemeanor.
(h) No prize shall be paid to any person under the age of 18
years. Any person who knowingly claims or attempts to claim a prize
with a ticket or share purchased by a person under the age of 18
years is guilty of a misdemeanor.
8880.325. The right of any person to a prize shall not be
assignable, except that the payment of any prize may be assigned, in
whole or in part, as provided by Section 8880.326 and this section
under any of the following circumstances:
(a) An assignment executed by the prizewinner on a form approved
by, and filed with, the commission during the prizewinner's lifetime
in accordance with regulations adopted by the commission, to a trust
that by its terms is revocable and that is established by the
prizewinner for the benefit of the prizewinner as a beneficiary and
governed by the laws of the state.
(b) An appropriate judicial order appointing a conservator or a
guardian for the protection of the prizewinner or for adjudicating
rights to, or ownership of, the prize.
(c) An assignment, as collateral, to a person to secure a loan
pursuant to Division 9 (commencing with Section 9101) of the
Commercial Code. The assignment as collateral of the right to receive
payment of a prize shall be subject to all of the following:
(1) All security agreements, rights of the prizewinner, and rights
of the secured creditor shall be determined pursuant to the laws of
the state.
(2) In the event of a default under the loan or security
agreement, the secured creditor's rights shall be limited to
receiving the regular payments made by the lottery, based on the
prizewinner's right to receive a regular prize payment until the
obligation has been paid in full or the prize has been paid in full,
whichever occurs first. Notwithstanding Division 9 (commencing with
Section 9101) of the Commercial Code, the secured creditor shall not
have the right to sell or assign the prizewinner's rights to payments
to itself or to any other person. This section shall not limit the
secured creditor's right to sell, assign, or transfer the obligation
of the debtor and related security interest to a third party.
(3) The prizewinner and secured creditor may agree, and may
jointly instruct the lottery, to directly deposit all prizewinning
payments into an account maintained by the prizewinner at a federally
insured financial institution located within the state. This account
may be subject to the secured creditor's lien. Upon receipt of these
instructions, the lottery shall continue to deposit all payments due
the prizewinner into the account until the lottery receives
notification from both the secured creditor and the prizewinner that
the payments are to be made to an account maintained at another bank
or that the secured creditor releases or terminates the security
interest in the prizewinner's payments.
(4) (A) The prizewinner, pursuant to an order of the court
obtained in compliance with subdivision (d), may direct the lottery
to make the prize payments, in whole or in part, directly to the
secured creditor. A direction to the lottery to make a prize payment
to a secured creditor shall not, in itself, constitute an assignment
of the prize payment to the secured creditor.
(B) For purposes of this paragraph and subdivision (d), "assignee"
and "secured creditor" are synonymous, and "assignment" or "prize
payment" means the payment that is directed to be paid to the secured
creditor.
(5) For purposes of perfecting the security interest of the
secured creditor, the right of the prizewinner to receive payments is
deemed to be a contract right that is perfected by the filing of a
financing statement with the office of the Secretary of State.
(6) A copy of the security agreement, an endorsed copy of the
financing statement, and the joint instruction to deposit the
prizewinner's payments directly into an account, if any, at the
financial institution shall be filed with the lottery.
Notwithstanding the security interest granted a creditor, all lottery
payments shall be made payable directly to the prizewinner, except
as follows:
(A) Payments sent directly to the financial institution designated
pursuant to paragraph (3).
(B) In the event of a default under the security agreement or
obligation it secures, payments sent directly to the secured creditor
pursuant to an order of a court of competent jurisdiction
determining that the payments are to be made directly to the secured
creditor.
(7) Upon the termination or release of the security interest, the
secured creditor shall file an endorsed copy of the release or
termination of the security interest with the lottery.
(d) Except as provided in subdivision (j), an assignment of future
payments to another person designated pursuant to an appropriate
judicial order of a California superior court or a federal court
having jurisdiction over property located within California, if the
court determines and states in its order all of the following:
(1) That the prizewinner was represented by independent legal
counsel whose name and State Bar of California number appears as
counsel of record on all pleadings filed in any and all court
proceedings. The prizewinner's legal counsel shall appear as counsel
of record at any proceedings that are required by the court.
(2) That the prizewinner has represented to the court either by
sworn testimony if a personal appearance is required by the court, or
by written declaration filed with the court under penalty of
perjury, and that the court has determined these representations to
be true and correct, that the prizewinner (A) has reviewed and
understands the terms and effects of the assignment, (B) understands
that he or she will not receive the prize payments or portions
thereof for the years assigned, (C) has entered into the agreement of
his or her own free will without undue influence or duress and not
under the influence of drugs or alcohol, (D) has had an opportunity
to retain independent financial and tax advice, and (E) has been
represented by independent legal counsel, who has advised the
prizewinner of his or her legal rights and obligations under the
assignment.
(3) It shall be the responsibility of the prizewinner to bring to
the attention of the court, either by sworn testimony or by written
declaration submitted under penalty of perjury, the existence or
nonexistence of a current spouse. If married, the prizewinner shall
identify his or her spouse and submit to the court a signed and
notarized statement wherein the spouse consents to the assignment. If
the prizewinner is married and the notarized statement is not
presented to the court, the court shall determine, to the extent
necessary and as appropriate under applicable law, the ability of the
prizewinner to make the proposed assignment without the spouse's
consent.
(4) The specific prize payment or payments assigned, or any
portion thereof, including the dates and amounts of the payments to
be assigned, the years in which each payment is to begin and end, the
gross amount of the annual payments assigned before taxes, the
prizewinner's name as it appears on the lottery claim form, the full
legal name of the assignor if different than the prizewinner's name
as it appears on the lottery claim form, the assignor's social
security or tax identification number, the assignee's full legal name
and social security or tax identification number, and, if
applicable, the citizenship or resident alien number of the assignee
if a natural person.
(5) Expressly identifies the amount, the date if available, any
nonspouse coowner, claimant, or lienholder, and the interests, liens,
security interests, assignments, or offsets asserted by the state or
other persons against any of the prize payments, including, but not
limited to, those payments that are the subject of the proposed
assignment as those interests, liens, security interests,
assignments, or offsets have been represented to the court by the
prizewinner in a written declaration signed under penalty of perjury
and filed with the court.
(6) That the lottery and the State of California are not parties
to the proceeding and that the lottery and the state may rely upon
the order in disbursing the prize payments that are the subject of
the order. Further, that upon payment of prize moneys pursuant to an
order of the court, the lottery, the director, the commission, and
the employees of the lottery and the state shall be discharged of any
and all liability for the prize paid, and these persons and entities
shall have no duty or obligation to any person asserting another
interest in, or right to receive, the prize payment.
(7) That the prizewinner or the proposed assignee has obtained and
filed with the court a notification from the lottery of any liens,
levies, or claims, and the Controller's office of any offsets
asserted as of that time against the prizewinner, as reflected in
their respective official records as of the time of the notification.
The date of the notification shall not be more than 20 days prior to
the court hearing, unless extended by the court.
(e) The assignment of the right to receive any prize payment or
payments by the prizewinner pursuant to subdivision (d) shall be
conditioned on the following terms, conditions, and rights, which may
not be waived or modified by the prizewinner:
(1) The payment of moneys to, or on behalf of, the prizewinner by
the assignee in consideration for the assignment of the prize payment
or payments shall be made in full prior to the time when, under the
terms of the assignment, the lottery is required to make the first
prize payment to the assignee, or may be made in two installments,
the first being paid prior to the time when, under the terms of the
assignment, the lottery is required to make the first prize payment
to the assignee and the second installment within 11 months
thereafter. The second installment shall not be in an amount that
exceeds the first installment. Notwithstanding the foregoing, any
other installment payment schedule is permitted if the installment
obligation relating to the installments is guaranteed by a financial
institution, as defined in paragraph (2) of subdivision (a) of
Section 4981 of the Financial Code, or a brokerage firm that is a
member of the Securities Investor Protection Corporation (SIPC), as
required by the federal Securities Investor Protection Act of 1970
(15 U.S.C. Sec. 78aaa et seq.).
(2) If the prizewinner elects to accept the consideration to be
paid for the assignment in two installments as provided in paragraph
(1), the prizewinner shall have a special lien for the balance of any
payment due, effective without any further action, agreement, or
notice, on any of the prize payments assigned by the prizewinner for
the payment of moneys from the assignee. This lien shall terminate
upon the prizewinner receiving actual payment of the moneys. The
tendering of a check, payment instrument, or recital of payment shall
not constitute actual payment of moneys for the purposes of this
paragraph. Notwithstanding the foregoing, if a prizewinner accepts an
installment obligation guaranteed by a Federal Deposit Insurance
Corporation (FDIC) or SIPC insured entity, then the lien created by
this section shall automatically terminate upon delivery of the
installment obligation.
(3) The Legislature finds and declares that the creation of a
statutory lien in favor of a prizewinner is necessary to protect the
rights of the prizewinner from any creditors, subsequent bankruptcy
trustees of the assignee, or from any subsequent assignees when the
prizewinner has not received full payment for the assigned prize
payments.
(f) Prior to the assignment of any prize as provided in
subdivisions (c) and (d), the Controller shall determine whether the
prizewinner owes any obligation that is subject to offset under
Article 2 (commencing with Section 12410) of Chapter 5 of Part 2 of
Division 3 and shall provide written notification of that
determination to the lottery and to the Secretary of State.
(g) If the lottery determines that the court order issued pursuant
to subdivision (d) is complete and correct in all respects, the
lottery shall send the prizewinner and the assignee or assignees
written confirmation of receipt of the court-ordered assignment and
of the lottery's intention to rely thereon in making future payments
to the assignee or assignees named in the court order.
(h) Notwithstanding any other provision of law, by entering into
an agreement to assign any prize payments pursuant to subdivision (c)
or (d), a prizewinner shall be deemed to have waived any statutory
period of limitation as to the State of California enforcing any
rights against annual prize payments due after the last assigned
payment is paid or released, if assigned as collateral, from the lien
granted the secured creditor. No assignment of prize payments
pursuant to either subdivision (c) or (d) shall be valid or allowed
for the final three annual prize payments from the lottery to the
prizewinner.
(i) Any loans made to a prizewinner pursuant to this section shall
be exempt from the usury provisions of Article XV of the California
Constitution with respect to an assignment of a lottery prize as
collateral to secure a loan.
(j) (1) Notwithstanding any other provision of this section, no
prizewinner shall have the right to assign prize payments pursuant to
subdivision (d) or direct the payment of a prize pursuant to
paragraph (4) of subdivision (c) if any of the following occurs:
(A) The issuance by the United States Internal Revenue Service
(IRS) of a technical rule letter, revenue ruling, or other public
ruling of the IRS in which the IRS determines that, based upon the
right of assignment provided in subdivision (d), a California lottery
prizewinner who does not assign any prize payments pursuant to
subdivision (d) would be subject to an immediate income tax liability
for the value of the entire prize rather than annual income tax
liability for each installment when paid.
(B) The issuance by a court of competent jurisdiction of a
published decision holding that, based upon the right of assignment
provided in subdivision (d), a California lottery prizewinner who
does not assign any prize payments pursuant to subdivision (d) would
be subject to an immediate income tax liability for the value of the
entire prize rather than annual income tax liability for each
installment when paid.
(2) Upon receipt of a letter or ruling from the IRS or a published
decision of a court of competent jurisdiction, as specified in
paragraph (1), the director shall immediately file a copy of that
letter, ruling, or published decision with the Secretary of State.
Immediately upon the filing by the director of a letter, ruling,
or published decision with the Secretary of State, a prizewinner
shall be ineligible to assign a prize pursuant to subdivision (d) or
direct the payment of a prize pursuant to paragraph (4) of
subdivision (c).
8880.326. Upon the death of the prizewinner, the prize may be paid
by any of the following methods:
(a) To the trustee of a trust established pursuant to subdivision
(a) of Section 8880.325, or, if the trust has been terminated, to
those beneficiaries entitled to distribution under Section 8880.325.
(b) To one or more beneficiaries designated on a form approved by
the commission for that purpose, executed by the prizewinner, filed
with the commission in accordance with regulations adopted by the
commission to govern those designations, and in effect upon the
prizewinner's death.
(c) In the absence of an assignment to a trust or a beneficiary
designation, the prizewinner's prize may be paid, as follows:
(1) To the personal representative of the testate or intestate
estate of a deceased prizewinner upon receipt by the commission of a
court order and letters appointing an executor, administrator, or
other personal representative of the estate of the deceased
prizewinner, or pursuant to a final order of distribution.
(2) As provided under Part 1 (commencing with Section 13000) or
Part 2 (commencing with Section 13500) of Division 8 of the Probate
Code.
(3) To a person or persons designated under an appropriate
judicial order adjudicating rights to the ownership of the prize.
8880.327. For any assignments, transfers, or security interests
provided for in Sections 8880.325 and 8880.326, the following shall
apply:
(a) The commission may establish a reasonable fee for all expenses
incurred in order to comply with Section 8880.325 or 8880.326
relating to an authorized assignment, transfer, or security interest.
The fee may be deducted from the prize moneys paid by the lottery
pursuant to Section 8880.325 or 8880.326.
(b) Upon the payment of prize moneys pursuant to Section 8880.325
or 8880.326 or an order of a court, the lottery, the director, the
commission, and the employees of the lottery and the state shall be
discharged of any and all liability for the prize paid, and they
shall have no duty or obligation to any persons asserting another
interest in, or right to receive, the prize payment.
(c) The commission shall adopt regulations necessary to implement
Section 8880.325 or 8880.326 allowing for a limited right of
prizewinners to assign their rights to prize payments and setting the
reasonable fee for expenses to be recovered by the lottery. The
regulations shall be consistent with and shall further the
Legislature's intent that prizewinners who wish to do so should be
afforded the opportunity to currently enjoy more of their winnings as
provided by Section 1 of Chapter 890 of the Statutes of 1994. If the
commission deems it necessary, the regulations may require, as a
condition to any voluntary assignment pursuant to subdivision (d) of
Section 8880.325, that the prizewinner be represented by independent
legal counsel and receive independent financial and tax advice
concerning the effect of the assignment.
8880.33. (a) The commission shall promulgate regulations specifying
the manner of distribution, dissemination, or sale of lottery
tickets or shares to lottery game retailers or directly to the
public, and the incentives, if any, for lottery employees engaged in
the distribution or sales activities.
(b) The commission shall also make available upon request to
lottery game retailers a model agreement to govern the division of
prizes among multiple purchasers of a winning ticket or tickets
purchased through a group purchase or pooling arrangement.
8880.335. The commission may promulgate regulations to authorize
the use of an electronic or electromechanical device to dispense
lottery tickets to be used in the play of any lottery game, if the
device satisfies all of the following specifications:
(a) The lottery ticket dispenser dispenses a paper or cardboard
ticket that provides the purchaser of the ticket with an opportunity
to win a prize in a lottery game, and the ticket fits one of the
following descriptions:
(1) The ticket has an ascertainable prize value, including a null
prize value or an opportunity to enter another lottery game at the
time it is dispensed, provided that the prize value of the ticket may
be revealed to the purchaser of the ticket only after the purchaser
has removed the ticket from the dispenser and only by physically
removing a covering that hides numbers or symbols that are imprinted
on the ticket.
(2) The ticket has no value at the time it is dispensed, except
for restitution of the purchase price, but may acquire a redemption
value as the result of a draw that occurs after the ticket is
dispensed.
(b) If the lottery ticket dispenser dispenses tickets described in
paragraph (1) of subdivision (a), then neither the operation or
functioning of the ticket dispenser nor the operation or functioning
of any component, subcomponent, part, chip, or program of the ticket
dispenser, or of any device in direct or indirect communication with
the ticket dispenser, may affect the probability that a ticket that
is dispensed will have a prize value other than a null prize value.
(c) If a lottery ticket dispenser includes any component,
subcomponent, mechanism, or feature that is capable of generating
numbers or symbols for use in the play of a lottery game, or if the
lottery ticket dispenser communicates directly or indirectly with any
device that includes any component, subcomponent, mechanism, or
feature that is capable of generating numbers or symbols for use in
the play of a lottery game, that component, subcomponent, mechanism,
or feature may be used only in the production and dispensing of
lottery tickets described in paragraph (2) of subdivision (a).
(d) A lottery ticket dispenser that dispenses tickets described in
paragraph (2) of subdivision (a) shall not also be the device used
in the subsequent draw to determine winning tickets and shall not be
capable of causing, directly or indirectly, the operation of any
device used in the subsequent draw to determine winning tickets.
(e) The lottery ticket dispenser shall not make change or
otherwise dispense coins, currency, or any thing of value other than
a lottery ticket.
(f) No lottery ticket dispenser that utilizes a television monitor
or video screen shall display or reproduce the image or facsimile
of, or any other visual representation of, a lottery ticket that will
be or has been dispensed or issued from that lottery ticket
dispenser. Nothing herein shall preclude the use of television
monitors or video screens to transmit messages about lottery games
and game results, if those messages are not generated by the lottery
ticket dispenser.
8880.24. Powers and Duties of the Commission
(a) The California State Lottery Commission shall exercise all
powers necessary to effectuate the purposes of this chapter. In all
decisions, the commission shall take into account the particularly
sensitive nature of the California State Lottery and shall act to
promote and ensure integrity, security, honesty, and fairness in the
operation and administration of the Lottery.
(b) In decisions relating to advertising and promotion of the
California State Lottery, the commission shall ensure that the
California State Lottery complies with both the letter and spirit of
the laws governing false and misleading advertising, including
Section 17500 et seq. of the Business and Professions Code. The
commission shall also ensure that the overall estimated odds of
winning some prize or prizes in a particular lottery game are posted
on all television and print advertising, exclusive of outdoor
advertising displays, signs, or banners, related to that game.
8880.25. Operation of the Lottery
The Lottery shall be initiated and operated so as to produce the
maximum amount of net revenues to supplement the total amount of
money allocated for public education in California.
8880.25.5. (a) Notwithstanding any other provision of law, the
Lottery Commission may do all of the following:
(1) Purchase and sell assets in its own name.
(2) Invest funds on deposit in the State Lottery Fund within or
outside the State Treasury system.
(3) Purchase and sell securities, including entering into bond
purchase agreements with the state to purchase state general
obligation bonds, or invest in other evidence of indebtedness issued
by the state, including, but not limited to, notes issued pursuant to
Part 5 (commencing with Section 17300) of Division 4 or warrants
issued pursuant to Part 4 (commencing with Section 17000) of Division
4.
(b) The bonds or other evidence of indebtedness specified in
subdivision (a), upon delivery to the Lottery Commission, shall, for
all purposes, be valid and binding obligations of the issuer thereof,
be validly issued and outstanding in accordance with their stated
terms, and shall not be deemed to be owned by or on behalf of the
issuer thereof.
8880.26. (a) The provisions of Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 are not applicable to any rule or
regulation promulgated by the commission.
(b) Section 2889 of the Public Utilities Code shall not be
applicable to any live, recorded, or recorded-interactive audio text
access telephone service under contract to the commission, as of the
effective date of the act adding this subdivision, that provides the
public with lottery game draw results.
(c) The provisions of the Public Contract Code shall not apply to
expenditures made by the lottery in furtherance of its duty to
produce the maximum amount of net revenues.
8880.27. Meetings with the Director
The Commission shall meet with the Director not less than once
each quarter to make recommendations and set policy, to approve or
reject reports of the Director and transact such other business that
may be properly brought before it.
8880.28. (a) The commission shall promulgate regulations specifying
the types of lottery games to be conducted by the lottery, provided:
(1) No lottery game may use the theme of roulette, dice, baccarat,
blackjack, Lucky 7s, draw poker, slot machines, or dog racing.
(2) In lottery games utilizing tickets, each ticket in these games
shall bear a unique number distinguishing it from every other ticket
in that game; and no name of an elected official shall appear on
these tickets.
(3) In games utilizing computer terminals or other devices, no
coins or currency shall be dispensed as prizes to players from these
computer terminals or devices.
(b) Notwithstanding subdivision (a), no changes in the types of
games or methods of delivery of these games that incorporate
technologies or mediums that did not exist, were not widely
available, or were not commercially feasible at the time of the
enactment of this chapter in 1984 shall be made, unless all of the
following conditions are met:
(1) This chapter is amended by statute to expressly authorize
these changes.
(2) The act making the amendments contains express legislative
findings that the amendments are consistent with the terms of, and
further the purposes of, this chapter.
(3) The amendments comport with applicable state and federal law.
(c) For purposes of this section, a change in the method of
delivery means a material change in the way a consumer directly
interacts with the game.
(d) Subdivision (b) does not apply to technological changes
implemented prior to October 11, 1993.
(e) This section does not limit any internal technological changes
made to the equipment or components utilized by the lottery.
8880.29. (a) The commission shall promulgate regulations that
specify the number and value of prizes for winning tickets or shares
in each lottery game including, without limitation, cash prizes,
merchandise prizes, prizes consisting of deferred payments or
annuities, and prizes of tickets or shares in the same lottery game
or other games conducted by the lottery, provided:
(1) In lottery games utilizing tickets, the overall estimated odds
of winning some prize or some cash prize as appropriate for the
lottery game shall be printed on each ticket or on a play slip.
(2) A detailed tabulation of the estimated number of prizes of
each particular prize denomination that are expected to be awarded in
each lottery game, or the estimated odds of winning the prizes,
shall be available at each location at which tickets or shares in the
lottery games are offered for sale to the public.
(b) Annuity contracts that are purchased for prizes shall be
exempt from the requirements of Section 8880.57.
8880.30. The commission shall promulgate regulations that specify
the method for determining winners in each lottery game, provided:
(a) A lottery game may be based on the results of a horse race
with the consent of the association conducting the race and the
California Horse Racing Board. Any compensation received by an
association for the use of its races to determine the winners of a
lottery game shall be divided equally between commissions and purses.
(b) If a lottery game utilizes a drawing of winning numbers, a
drawing among entries, or a drawing among finalists, the drawings
shall always be open to the public. No manual or physical selection
in the drawings shall be conducted by any employee of the Lottery.
Except for computer automated drawings, drawings shall be witnessed
by an independent lottery contractor having qualifications
established by the commission. Any equipment used in the drawings
shall be inspected by the independent lottery contractor and an
employee of the Lottery both before and after the drawings. The
drawings and the inspections shall be both audio and video recorded.
(c) It is the intent of this chapter that the commission may use
any of a variety of existing or future methods or technologies in
determining winners.
8880.31. Sale Price of Tickets and Shares
The Commission shall promulgate rules and regulations specifying
the retail sales price for each ticket or share for each Lottery
Game, provided:
(a) Except as provided in subdivision (b), no ticket or share
shall be sold for more or less than the retail sales price
established by the Commission.
(b) The retail price of each ticket or share in any Lottery Game
conducted by the Lottery shall be at least one dollar ($1), except to
the extent of any discounts authorized by the Commission.
8880.321. The commission shall promulgate regulations to establish
a system of verifying the validity of prizes and to effect payment of
the prizes, provided that:
(a) For convenience of the public, lottery game retailers may be
authorized by the commission to pay winners of up to six hundred
dollars ($600) after performing validation procedures on their
premises appropriate to the lottery game involved.
(b) No prize may be paid arising from tickets or shares that are
stolen, counterfeit, altered, fraudulent, unissued, produced or
issued in error, unreadable, not received or not recorded by the
lottery by applicable deadlines, lacking in captions that confirm and
agree with the lottery play symbols required by the lottery game
involved, purchased by a minor, or not in compliance with additional
specific rules and regulations and confidential validation and
security tests appropriate to the particular lottery game. The
lottery may pay a prize even though the actual winning ticket is not
received by the lottery if the lottery validates the claim for the
prize based upon substantial proof. "Substantial proof" means any
evidence that would permit the lottery to use established validation
procedures, as specified in lottery regulations, to validate the
claim.
The commission may require that any form relating to a claim for a
prize shall be signed under penalty of perjury. This declaration
shall meet the requirements of Section 2015.5 of the Code of Civil
Procedure.
(c) No particular prize in any lottery game shall be paid more
than once.
(d) The commission may specify that winners of less than
twenty-five dollars ($25) claim the prizes from either the same
lottery game retailer from whom the ticket or share was purchased or
from the lottery itself.
(e) Players shall have the right to claim prize money for 180 days
after the drawing or the end of the lottery game or play in which
the prize was won, or, if a multistate lottery game, up to one year
for jackpots and grand prizes. The commission may define shorter time
periods for eligibility for participation in, and entry into,
drawings involving entries or finalists. If a valid claim is not made
for a prize directly payable by the commission or for any online
game prize within the period applicable for that prize, the unclaimed
prize money shall be treated as set forth in subdivision (a) of
Section 8880.4 or, commencing with the 2009-10 fiscal year, be
treated as total revenues as set forth in Section 8880.4.5.
(f) After the expiration of the claim period for prizes for each
lottery game, the commission shall make available a detailed
tabulation of the total number of tickets or shares actually sold in
a lottery game and the total number of prizes of each prize
denomination that were actually claimed and paid directly by the
commission.
(g) A ticket or share shall not be purchased by, and a prize shall
not be paid to, a member of the commission, any officer or employee
of the commission, any officer or employee of the Controller who is
designated in writing by the Controller as having possible access to
confidential lottery information, programs, or systems, or any
spouse, child, brother, sister, or parent of that person who resides
within the same household of the person. Any person who knowingly
sells or purchases a ticket or share in violation of this section, or
who knowingly claims or attempts to claim a prize with a ticket or
share that was purchased or sold in violation of this section, is
guilty of a misdemeanor.
(h) No prize shall be paid to any person under the age of 18
years. Any person who knowingly claims or attempts to claim a prize
with a ticket or share purchased by a person under the age of 18
years is guilty of a misdemeanor.
8880.325. The right of any person to a prize shall not be
assignable, except that the payment of any prize may be assigned, in
whole or in part, as provided by Section 8880.326 and this section
under any of the following circumstances:
(a) An assignment executed by the prizewinner on a form approved
by, and filed with, the commission during the prizewinner's lifetime
in accordance with regulations adopted by the commission, to a trust
that by its terms is revocable and that is established by the
prizewinner for the benefit of the prizewinner as a beneficiary and
governed by the laws of the state.
(b) An appropriate judicial order appointing a conservator or a
guardian for the protection of the prizewinner or for adjudicating
rights to, or ownership of, the prize.
(c) An assignment, as collateral, to a person to secure a loan
pursuant to Division 9 (commencing with Section 9101) of the
Commercial Code. The assignment as collateral of the right to receive
payment of a prize shall be subject to all of the following:
(1) All security agreements, rights of the prizewinner, and rights
of the secured creditor shall be determined pursuant to the laws of
the state.
(2) In the event of a default under the loan or security
agreement, the secured creditor's rights shall be limited to
receiving the regular payments made by the lottery, based on the
prizewinner's right to receive a regular prize payment until the
obligation has been paid in full or the prize has been paid in full,
whichever occurs first. Notwithstanding Division 9 (commencing with
Section 9101) of the Commercial Code, the secured creditor shall not
have the right to sell or assign the prizewinner's rights to payments
to itself or to any other person. This section shall not limit the
secured creditor's right to sell, assign, or transfer the obligation
of the debtor and related security interest to a third party.
(3) The prizewinner and secured creditor may agree, and may
jointly instruct the lottery, to directly deposit all prizewinning
payments into an account maintained by the prizewinner at a federally
insured financial institution located within the state. This account
may be subject to the secured creditor's lien. Upon receipt of these
instructions, the lottery shall continue to deposit all payments due
the prizewinner into the account until the lottery receives
notification from both the secured creditor and the prizewinner that
the payments are to be made to an account maintained at another bank
or that the secured creditor releases or terminates the security
interest in the prizewinner's payments.
(4) (A) The prizewinner, pursuant to an order of the court
obtained in compliance with subdivision (d), may direct the lottery
to make the prize payments, in whole or in part, directly to the
secured creditor. A direction to the lottery to make a prize payment
to a secured creditor shall not, in itself, constitute an assignment
of the prize payment to the secured creditor.
(B) For purposes of this paragraph and subdivision (d), "assignee"
and "secured creditor" are synonymous, and "assignment" or "prize
payment" means the payment that is directed to be paid to the secured
creditor.
(5) For purposes of perfecting the security interest of the
secured creditor, the right of the prizewinner to receive payments is
deemed to be a contract right that is perfected by the filing of a
financing statement with the office of the Secretary of State.
(6) A copy of the security agreement, an endorsed copy of the
financing statement, and the joint instruction to deposit the
prizewinner's payments directly into an account, if any, at the
financial institution shall be filed with the lottery.
Notwithstanding the security interest granted a creditor, all lottery
payments shall be made payable directly to the prizewinner, except
as follows:
(A) Payments sent directly to the financial institution designated
pursuant to paragraph (3).
(B) In the event of a default under the security agreement or
obligation it secures, payments sent directly to the secured creditor
pursuant to an order of a court of competent jurisdiction
determining that the payments are to be made directly to the secured
creditor.
(7) Upon the termination or release of the security interest, the
secured creditor shall file an endorsed copy of the release or
termination of the security interest with the lottery.
(d) Except as provided in subdivision (j), an assignment of future
payments to another person designated pursuant to an appropriate
judicial order of a California superior court or a federal court
having jurisdiction over property located within California, if the
court determines and states in its order all of the following:
(1) That the prizewinner was represented by independent legal
counsel whose name and State Bar of California number appears as
counsel of record on all pleadings filed in any and all court
proceedings. The prizewinner's legal counsel shall appear as counsel
of record at any proceedings that are required by the court.
(2) That the prizewinner has represented to the court either by
sworn testimony if a personal appearance is required by the court, or
by written declaration filed with the court under penalty of
perjury, and that the court has determined these representations to
be true and correct, that the prizewinner (A) has reviewed and
understands the terms and effects of the assignment, (B) understands
that he or she will not receive the prize payments or portions
thereof for the years assigned, (C) has entered into the agreement of
his or her own free will without undue influence or duress and not
under the influence of drugs or alcohol, (D) has had an opportunity
to retain independent financial and tax advice, and (E) has been
represented by independent legal counsel, who has advised the
prizewinner of his or her legal rights and obligations under the
assignment.
(3) It shall be the responsibility of the prizewinner to bring to
the attention of the court, either by sworn testimony or by written
declaration submitted under penalty of perjury, the existence or
nonexistence of a current spouse. If married, the prizewinner shall
identify his or her spouse and submit to the court a signed and
notarized statement wherein the spouse consents to the assignment. If
the prizewinner is married and the notarized statement is not
presented to the court, the court shall determine, to the extent
necessary and as appropriate under applicable law, the ability of the
prizewinner to make the proposed assignment without the spouse's
consent.
(4) The specific prize payment or payments assigned, or any
portion thereof, including the dates and amounts of the payments to
be assigned, the years in which each payment is to begin and end, the
gross amount of the annual payments assigned before taxes, the
prizewinner's name as it appears on the lottery claim form, the full
legal name of the assignor if different than the prizewinner's name
as it appears on the lottery claim form, the assignor's social
security or tax identification number, the assignee's full legal name
and social security or tax identification number, and, if
applicable, the citizenship or resident alien number of the assignee
if a natural person.
(5) Expressly identifies the amount, the date if available, any
nonspouse coowner, claimant, or lienholder, and the interests, liens,
security interests, assignments, or offsets asserted by the state or
other persons against any of the prize payments, including, but not
limited to, those payments that are the subject of the proposed
assignment as those interests, liens, security interests,
assignments, or offsets have been represented to the court by the
prizewinner in a written declaration signed under penalty of perjury
and filed with the court.
(6) That the lottery and the State of California are not parties
to the proceeding and that the lottery and the state may rely upon
the order in disbursing the prize payments that are the subject of
the order. Further, that upon payment of prize moneys pursuant to an
order of the court, the lottery, the director, the commission, and
the employees of the lottery and the state shall be discharged of any
and all liability for the prize paid, and these persons and entities
shall have no duty or obligation to any person asserting another
interest in, or right to receive, the prize payment.
(7) That the prizewinner or the proposed assignee has obtained and
filed with the court a notification from the lottery of any liens,
levies, or claims, and the Controller's office of any offsets
asserted as of that time against the prizewinner, as reflected in
their respective official records as of the time of the notification.
The date of the notification shall not be more than 20 days prior to
the court hearing, unless extended by the court.
(e) The assignment of the right to receive any prize payment or
payments by the prizewinner pursuant to subdivision (d) shall be
conditioned on the following terms, conditions, and rights, which may
not be waived or modified by the prizewinner:
(1) The payment of moneys to, or on behalf of, the prizewinner by
the assignee in consideration for the assignment of the prize payment
or payments shall be made in full prior to the time when, under the
terms of the assignment, the lottery is required to make the first
prize payment to the assignee, or may be made in two installments,
the first being paid prior to the time when, under the terms of the
assignment, the lottery is required to make the first prize payment
to the assignee and the second installment within 11 months
thereafter. The second installment shall not be in an amount that
exceeds the first installment. Notwithstanding the foregoing, any
other installment payment schedule is permitted if the installment
obligation relating to the installments is guaranteed by a financial
institution, as defined in paragraph (2) of subdivision (a) of
Section 4981 of the Financial Code, or a brokerage firm that is a
member of the Securities Investor Protection Corporation (SIPC), as
required by the federal Securities Investor Protection Act of 1970
(15 U.S.C. Sec. 78aaa et seq.).
(2) If the prizewinner elects to accept the consideration to be
paid for the assignment in two installments as provided in paragraph
(1), the prizewinner shall have a special lien for the balance of any
payment due, effective without any further action, agreement, or
notice, on any of the prize payments assigned by the prizewinner for
the payment of moneys from the assignee. This lien shall terminate
upon the prizewinner receiving actual payment of the moneys. The
tendering of a check, payment instrument, or recital of payment shall
not constitute actual payment of moneys for the purposes of this
paragraph. Notwithstanding the foregoing, if a prizewinner accepts an
installment obligation guaranteed by a Federal Deposit Insurance
Corporation (FDIC) or SIPC insured entity, then the lien created by
this section shall automatically terminate upon delivery of the
installment obligation.
(3) The Legislature finds and declares that the creation of a
statutory lien in favor of a prizewinner is necessary to protect the
rights of the prizewinner from any creditors, subsequent bankruptcy
trustees of the assignee, or from any subsequent assignees when the
prizewinner has not received full payment for the assigned prize
payments.
(f) Prior to the assignment of any prize as provided in
subdivisions (c) and (d), the Controller shall determine whether the
prizewinner owes any obligation that is subject to offset under
Article 2 (commencing with Section 12410) of Chapter 5 of Part 2 of
Division 3 and shall provide written notification of that
determination to the lottery and to the Secretary of State.
(g) If the lottery determines that the court order issued pursuant
to subdivision (d) is complete and correct in all respects, the
lottery shall send the prizewinner and the assignee or assignees
written confirmation of receipt of the court-ordered assignment and
of the lottery's intention to rely thereon in making future payments
to the assignee or assignees named in the court order.
(h) Notwithstanding any other provision of law, by entering into
an agreement to assign any prize payments pursuant to subdivision (c)
or (d), a prizewinner shall be deemed to have waived any statutory
period of limitation as to the State of California enforcing any
rights against annual prize payments due after the last assigned
payment is paid or released, if assigned as collateral, from the lien
granted the secured creditor. No assignment of prize payments
pursuant to either subdivision (c) or (d) shall be valid or allowed
for the final three annual prize payments from the lottery to the
prizewinner.
(i) Any loans made to a prizewinner pursuant to this section shall
be exempt from the usury provisions of Article XV of the California
Constitution with respect to an assignment of a lottery prize as
collateral to secure a loan.
(j) (1) Notwithstanding any other provision of this section, no
prizewinner shall have the right to assign prize payments pursuant to
subdivision (d) or direct the payment of a prize pursuant to
paragraph (4) of subdivision (c) if any of the following occurs:
(A) The issuance by the United States Internal Revenue Service
(IRS) of a technical rule letter, revenue ruling, or other public
ruling of the IRS in which the IRS determines that, based upon the
right of assignment provided in subdivision (d), a California lottery
prizewinner who does not assign any prize payments pursuant to
subdivision (d) would be subject to an immediate income tax liability
for the value of the entire prize rather than annual income tax
liability for each installment when paid.
(B) The issuance by a court of competent jurisdiction of a
published decision holding that, based upon the right of assignment
provided in subdivision (d), a California lottery prizewinner who
does not assign any prize payments pursuant to subdivision (d) would
be subject to an immediate income tax liability for the value of the
entire prize rather than annual income tax liability for each
installment when paid.
(2) Upon receipt of a letter or ruling from the IRS or a published
decision of a court of competent jurisdiction, as specified in
paragraph (1), the director shall immediately file a copy of that
letter, ruling, or published decision with the Secretary of State.
Immediately upon the filing by the director of a letter, ruling,
or published decision with the Secretary of State, a prizewinner
shall be ineligible to assign a prize pursuant to subdivision (d) or
direct the payment of a prize pursuant to paragraph (4) of
subdivision (c).
8880.326. Upon the death of the prizewinner, the prize may be paid
by any of the following methods:
(a) To the trustee of a trust established pursuant to subdivision
(a) of Section 8880.325, or, if the trust has been terminated, to
those beneficiaries entitled to distribution under Section 8880.325.
(b) To one or more beneficiaries designated on a form approved by
the commission for that purpose, executed by the prizewinner, filed
with the commission in accordance with regulations adopted by the
commission to govern those designations, and in effect upon the
prizewinner's death.
(c) In the absence of an assignment to a trust or a beneficiary
designation, the prizewinner's prize may be paid, as follows:
(1) To the personal representative of the testate or intestate
estate of a deceased prizewinner upon receipt by the commission of a
court order and letters appointing an executor, administrator, or
other personal representative of the estate of the deceased
prizewinner, or pursuant to a final order of distribution.
(2) As provided under Part 1 (commencing with Section 13000) or
Part 2 (commencing with Section 13500) of Division 8 of the Probate
Code.
(3) To a person or persons designated under an appropriate
judicial order adjudicating rights to the ownership of the prize.
8880.327. For any assignments, transfers, or security interests
provided for in Sections 8880.325 and 8880.326, the following shall
apply:
(a) The commission may establish a reasonable fee for all expenses
incurred in order to comply with Section 8880.325 or 8880.326
relating to an authorized assignment, transfer, or security interest.
The fee may be deducted from the prize moneys paid by the lottery
pursuant to Section 8880.325 or 8880.326.
(b) Upon the payment of prize moneys pursuant to Section 8880.325
or 8880.326 or an order of a court, the lottery, the director, the
commission, and the employees of the lottery and the state shall be
discharged of any and all liability for the prize paid, and they
shall have no duty or obligation to any persons asserting another
interest in, or right to receive, the prize payment.
(c) The commission shall adopt regulations necessary to implement
Section 8880.325 or 8880.326 allowing for a limited right of
prizewinners to assign their rights to prize payments and setting the
reasonable fee for expenses to be recovered by the lottery. The
regulations shall be consistent with and shall further the
Legislature's intent that prizewinners who wish to do so should be
afforded the opportunity to currently enjoy more of their winnings as
provided by Section 1 of Chapter 890 of the Statutes of 1994. If the
commission deems it necessary, the regulations may require, as a
condition to any voluntary assignment pursuant to subdivision (d) of
Section 8880.325, that the prizewinner be represented by independent
legal counsel and receive independent financial and tax advice
concerning the effect of the assignment.
8880.33. (a) The commission shall promulgate regulations specifying
the manner of distribution, dissemination, or sale of lottery
tickets or shares to lottery game retailers or directly to the
public, and the incentives, if any, for lottery employees engaged in
the distribution or sales activities.
(b) The commission shall also make available upon request to
lottery game retailers a model agreement to govern the division of
prizes among multiple purchasers of a winning ticket or tickets
purchased through a group purchase or pooling arrangement.
8880.335. The commission may promulgate regulations to authorize
the use of an electronic or electromechanical device to dispense
lottery tickets to be used in the play of any lottery game, if the
device satisfies all of the following specifications:
(a) The lottery ticket dispenser dispenses a paper or cardboard
ticket that provides the purchaser of the ticket with an opportunity
to win a prize in a lottery game, and the ticket fits one of the
following descriptions:
(1) The ticket has an ascertainable prize value, including a null
prize value or an opportunity to enter another lottery game at the
time it is dispensed, provided that the prize value of the ticket may
be revealed to the purchaser of the ticket only after the purchaser
has removed the ticket from the dispenser and only by physically
removing a covering that hides numbers or symbols that are imprinted
on the ticket.
(2) The ticket has no value at the time it is dispensed, except
for restitution of the purchase price, but may acquire a redemption
value as the result of a draw that occurs after the ticket is
dispensed.
(b) If the lottery ticket dispenser dispenses tickets described in
paragraph (1) of subdivision (a), then neither the operation or
functioning of the ticket dispenser nor the operation or functioning
of any component, subcomponent, part, chip, or program of the ticket
dispenser, or of any device in direct or indirect communication with
the ticket dispenser, may affect the probability that a ticket that
is dispensed will have a prize value other than a null prize value.
(c) If a lottery ticket dispenser includes any component,
subcomponent, mechanism, or feature that is capable of generating
numbers or symbols for use in the play of a lottery game, or if the
lottery ticket dispenser communicates directly or indirectly with any
device that includes any component, subcomponent, mechanism, or
feature that is capable of generating numbers or symbols for use in
the play of a lottery game, that component, subcomponent, mechanism,
or feature may be used only in the production and dispensing of
lottery tickets described in paragraph (2) of subdivision (a).
(d) A lottery ticket dispenser that dispenses tickets described in
paragraph (2) of subdivision (a) shall not also be the device used
in the subsequent draw to determine winning tickets and shall not be
capable of causing, directly or indirectly, the operation of any
device used in the subsequent draw to determine winning tickets.
(e) The lottery ticket dispenser shall not make change or
otherwise dispense coins, currency, or any thing of value other than
a lottery ticket.
(f) No lottery ticket dispenser that utilizes a television monitor
or video screen shall display or reproduce the image or facsimile
of, or any other visual representation of, a lottery ticket that will
be or has been dispensed or issued from that lottery ticket
dispenser. Nothing herein shall preclude the use of television
monitors or video screens to transmit messages about lottery games
and game results, if those messages are not generated by the lottery
ticket dispenser.
