99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB3870

 

Introduced , by Rep. Ed Sullivan

 

SYNOPSIS AS INTRODUCED:
 
20 ILCS 1605/7.12

    Amends the Illinois Lottery Law. Makes the Internet pilot program, which allows the sale of lottery tickets over the Internet, a permanent program. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning State government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Lottery Law is amended by changing
5Section 7.12 as follows:
 
6    (20 ILCS 1605/7.12)
7    Sec. 7.12. Internet pilot program.
8    (a) The General Assembly finds that:
9        (1) the consumer market in Illinois has changed since
10    the creation of the Illinois State Lottery in 1974;
11        (2) the Internet has become an integral part of
12    everyday life for a significant number of Illinois
13    residents not only in regards to their professional life,
14    but also in regards to personal business and communication;
15    and
16        (3) the current practices of selling lottery tickets
17    does not appeal to the new form of market participants who
18    prefer to make purchases on the Internet at their own
19    convenience.
20    It is the intent of the General Assembly to create an
21Internet pilot program for the sale of lottery tickets to
22capture this new form of market participant.
23    (b) The Department shall create a pilot program that allows

 

 

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1an individual 18 years of age or older to purchase lottery
2tickets or shares on the Internet without using a Lottery
3retailer with on-line status, as those terms are defined by
4rule. The Department shall restrict the sale of lottery tickets
5on the Internet to transactions initiated and received or
6otherwise made exclusively within the State of Illinois. The
7Department shall adopt rules necessary for the administration
8of this program. These rules shall include, among other things,
9requirements for marketing of the Lottery to infrequent
10players, as well as limitations on the purchases that may be
11made through any one individual's lottery account. The
12provisions of this Act and the rules adopted under this Act
13shall apply to the sale of lottery tickets or shares under this
14program.
15    Before beginning the pilot program, the Department of the
16Lottery must submit a request to the United States Department
17of Justice for review of the State's plan to implement a pilot
18program for the sale of lottery tickets on the Internet and its
19propriety under federal law. The Department shall implement the
20Internet pilot program only if the Department of Justice does
21not object to the implementation of the program within a
22reasonable period of time after its review.
23    The Department is obligated to implement the pilot program
24set forth in this Section and Sections 7.15 and 7.16 only at
25such time, and to such extent, that the Department of Justice
26does not object to the implementation of the program within a

 

 

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1reasonable period of time after its review. While the Illinois
2Lottery may only offer Lotto, Mega Millions, and Powerball
3games through the pilot program, the Department shall request
4review from the federal Department of Justice for the Illinois
5Lottery to sell lottery tickets on the Internet on behalf of
6the State of Illinois that are not limited to just these games.
7    The Department shall authorize the private manager to
8implement and administer the program pursuant to the management
9agreement entered into under Section 9.1 and in a manner
10consistent with the provisions of this Section. If a private
11manager has not been selected pursuant to Section 9.1 at the
12time the Department is obligated to implement the pilot
13program, then the Department shall not proceed with the pilot
14program until after the selection of the private manager, at
15which time the Department shall authorize the private manager
16to implement and administer the program pursuant to the
17management agreement entered into under Section 9.1 and in a
18manner consistent with the provisions of this Section.
19    The pilot program shall last for not less than 36 months,
20but not more than 48 months from the date of its initial
21operation.
22    Nothing in this Section shall be construed as prohibiting
23the Department from implementing and operating a website portal
24whereby individuals who are 18 years of age or older with an
25Illinois mailing address may apply to purchase lottery tickets
26via subscription. Nothing in this Section shall also be

 

 

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1construed as prohibiting the sale of Lotto, Mega Millions, and
2Powerball games by a lottery licensee pursuant to the
3Department's rules.
4    (c) There is created the Internet Lottery Study Committee
5as an advisory body within the Department. The Department shall
6conduct a study to determine the impact of the Internet pilot
7program on lottery licensees. The Department shall also
8determine the feasibility of the sale of stored value cards by
9lottery licensees as a non-exclusive option for use by
10individuals 18 years of age or older who purchase tickets for
11authorized lottery games in the Internet pilot program. For the
12purposes of this study, it is anticipated that the stored value
13cards will have, but need not be limited to, the following
14characteristics: (1) the cards will be available only to
15individuals 18 years of age and older; (2) the cards will be
16rechargeable, closed-loop cards that can only be loaded with
17cash; (3) the cards will have unique identifying numbers to be
18used for on-line play; (4) the cards will have on-line play
19subtracted from the card's value; (5) the cards may have
20on-line winnings added to them; (6) the cards will be used at
21Lottery retailers to cash out winnings of up to $600; and (7)
22the cards will meet all technological, programming, and
23security requirements mandated by the Department and the
24governing bodies of both Mega Millions and Powerball.
25    To the fullest extent possible, but subject to available
26resources, the Department shall ensure that the study evaluates

 

 

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1and analyzes at least the following issues:
2        (1) economic benefits to the State from Internet
3    Lottery sales from stored value cards and from resulting
4    sales taxes;
5        (2) economic benefits to local governments from sales
6    taxes generated from Internet Lottery sales through stored
7    value cards;
8        (3) economic benefits to Lottery retailers from
9    Internet Lottery sales and from ancillary retail product
10    sales in connection with the same;
11        (4) enhanced player age verification from face-to-face
12    interaction;
13        (5) enhanced control of gambling addiction from
14    face-to-face interaction;
15        (6) elimination of credit card overspending through
16    the use of stored value cards and resulting reduced debt
17    issues;
18        (7) the feasibility of the utilization of existing
19    Lottery machines to dispense stored value cards;
20        (8) the technological, programming, and security
21    requirements to make stored value cards an appropriate
22    sales alternative; and
23        (9) the cost and project time estimates for
24    implementation, including adaptation of existing Lottery
25    machines, programming, and technology enhancements and
26    impact to operations.

 

 

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1    The Study Committee shall consist of the Director or his or
2her designee; the chief executive officer of the Lottery's
3private manager or his or her designee; a representative
4appointed by the Governor's Office; 2 representatives of the
5lottery licensee community appointed by the Director; one
6representative of a statewide association representing food
7retailers appointed by the Director; and one representative of
8a statewide association representing retail merchants
9appointed by the Director.
10    Members of the Study Committee shall be appointed within 30
11days after the effective date of this amendatory Act of the
1297th General Assembly. No later than 6 months after the
13effective date of this amendatory Act of the 97th General
14Assembly, the Department shall provide to the members of the
15Study Committee the proposed findings and recommendations of
16the study in order to solicit input from the Study Committee.
17Within 30 calendar days thereafter, the Study Committee shall
18convene a meeting of the members to discuss the proposed
19findings and recommendations of the study. No later than 15
20calendar days after meeting, the Study Committee shall submit
21to the Department any written changes, additions, or
22corrections the Study Committee wishes the Department to make
23to the study. The Department shall consider the propriety of
24and respond to each change, addition, or correction offered by
25the Study Committee in the study. The Department shall also set
26forth any such change, addition, or correction offered by

 

 

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1members of the Study Committee and the Department's responses
2thereto in the appendix to the study. No later than 15 calendar
3days after receiving the changes, additions, or corrections
4offered by the Study Committee, the Department shall deliver
5copies of the final study and appendices, if any, to the
6Governor, President of the Senate, Minority Leader of the
7Senate, Speaker of the House of Representatives, Minority
8Leader of the House of Representatives, and each of the members
9of the Study Committee.
10(Source: P.A. 97-464, eff. 10-15-11; 97-1121, eff. 8-27-12;
1198-499, eff. 8-16-13.)
 
12    Section 99. Effective date. This Act takes effect upon
13becoming law.