Current through Register Vol. 63, No. 9, September 1, 2024
(1) General: For the purposes of this rule,
"temporary retailer contract" means a contract issued to a retailer for a
temporary period. A temporary retailer contract may be formed subject to such
special terms, conditions, or limitations as the Director may deem
prudent.
(2) Video Lottery
Limitations: Video Lottery retailer contract applications are eligible for
temporary contracts if both of the following apply and other requirements of
this rule are met:
(a) The contract for a
retailer premises is being terminated due to sale of business, change of
ownership, or 100% stock buyout, and the resulting contract application is for
the same retailer premises and the network service line is not removed from the
retailer premises.
(b) The
applicant and the applicant's business must qualify for the type of Lottery
sales sought by the applicant. For example, if the applicant seeks a contract
to offer Video Lottery games, the business must have an appropriate liquor
license and an age-controlled area that meets the Lottery's requirements. In
addition, the business must not be operating as a casino as described in OAR
177-040-0061.
(3)
(a) Submission: To apply for a temporary
retailer contract, an applicant must submit a complete application for a
retailer contract.
(b) Purchase of
Existing Business: When an applicant applies for a temporary retailer contract
for a business which the applicant is purchasing from an existing Lottery
retailer, the applicant must submit to the Lottery a complete application along
with any documentation requested by the Lottery regarding the intended purchase
prior to the date the applicant takes possession of the premises pursuant to a
purchase agreement. Notwithstanding submission of the application prior to the
date of possession, the Lottery shall not enter into a temporary retailer
contract with the applicant until on or after the date the applicant takes
legal possession of the business.
(4) Investigation: When the Lottery accepts
the complete application for a temporary retailer contract, the Director will
conduct an abbreviated investigation of the applicant and the business. That
investigation includes, but is not limited to:
(a) A computerized criminal background
check;
(b) A credit check using the
services of a commercial credit reporting company; and
(c) An inspection of the business for which
the applicant seeks a temporary retailer contract.
(5) Qualifying: An applicant may qualify for
a temporary retailer contract if, based on the abbreviated investigation and on
the application, all of the following criteria are met:
(a) The applicant is applying for a retailer
contract at a specific location;
(b) The "Criteria Precluding Entering Into a
Contract" described in OAR 177-040-0005 do not apply to the
applicant;
(c) The applicant has no
criminal convictions of any kind within five years of the date application is
made;
(d) The applicant has no
convictions as described in OAR 177-040-0010(3), "Criminal Behavior";
(e) The applicant has no Class "A"
misdemeanor or felony charges pending against the applicant;
(f) The applicant has no outstanding
judgments, liens, or collections, except those judgments which the applicant is
disputing through a legal process;
(g) The applicant is in compliance with all
tax laws;
(h) The applicant has
certified that the business location complies with OAR 177-040-0070, "Retailer
Wheelchair Accessibility Program";
(i) The applicant has the appropriate Oregon
Liquor and Cannabis Commission license, as required by ORS Chapter 461, if
applying for a contract to offer Video Lottery games; and
(j) There are no apparent factors regarding
the applicant to cause the Director to reasonably conclude that the applicant
poses an actual or apparent threat to the fairness, honesty, integrity, or
security of the Lottery and its games. Factors that may pose a threat include,
but are not limited to, any of the following examples:
(A) The applicant or key person has one or
more criminal convictions, depending on the nature and severity of the crimes
involved; or
(B) The applicant or
key person has been involved in any civil action in which the final judgment
indicates that the applicant or key person is not financially responsible,
depending on the nature, severity, and recency of the action.
(6) Other Requirements:
Prior to the effective date of the temporary retailer contract, the Director
may require the applicant to:
(a) Receive
training from the Lottery;
(b)
Establish an electronic funds transfer (EFT) bank account for Lottery
funds;
(c) Pay all necessary fees
associated with the installation of telephone lines and telephone
service;
(d) Agree to pay all
necessary fees associated with amusement device taxes prior to the effective
date of a temporary retailer contract; and
(e) Agree to be responsible for and to pay
all fees in connection with the application, including any cancellation fees
for telephone lines and service.
(7) Guarantor: If the applicant is an entity
other than either a sole proprietor who is a natural person or a private club
as defined in ORS 471.175(8), at
least one natural person who is a principal of the applicant entity and who is
a key person may be required to personally guarantee all monies owed to the
Lottery.
(8) Bonding: The Director
may require the applicant to post a bond, letter of credit, or cash deposit in
the form of certified funds prior to the effective date of a temporary retailer
contract.
(9) EFT Transfers: If the
Lottery enters into a temporary retailer contract with the applicant, the
contract will require the applicant to pay the amount due the Lottery from the
sale of Lottery tickets or shares by electronic funds transfer (EFT). In most
instances, amounts due the Lottery will be collected via EFT at the end of the
fourth day after the close of the Lottery business week. If an applicant
operates multiple Lottery retail sites before the effective date of this rule,
the routine date of the EFT collection may be set beyond the fourth day after
the close of the business week in order to accommodate the needs of the
combined sites. The applicant must establish an account for deposit of money
from the sale of Lottery tickets and shares with a financial institution that
has the capability of making EFT draws.
(10) Burden of Proof: The burden for
establishing that an applicant qualifies for a temporary retailer contract is
on the applicant.
(11) Termination:
In the Director's sole discretion, the Director may immediately terminate a
temporary retailer contract if the Director determines that continuing to
contract with the applicant is not in the best interest of the Lottery
including, but not limited to, when:
(a) The
applicant provided false or misleading material information, or the applicant
made a material omission in the application for a retailer contract;
(b) The applicant or any key person is
convicted of a Class "A" misdemeanor or felony during the term of the temporary
retailer contract;
(c) An EFT
payment is rejected for non-sufficient funds (NSF), or the applicant fails to
provide timely information to the Lottery regarding any change of the
applicant's EFT bank account;
(d)
Any other reason contained in the contract or administrative rules that
provides a basis for termination of a retailer contract; and
(e) When the Director concludes that
continuing to contract with the applicant may pose a threat to the fairness,
honesty, integrity, or security of the Lottery and its games.
(12) Length of Temporary Contract:
A temporary retailer contract shall be valid for a specific time period for up
to 120 days. A temporary retailer contract may, in the Director's discretion,
be extended for up to 120 additional days.
Statutory/Other Authority: Or Const, Art XV, § 4(4)(a),
ORS 461.120,
461.217 & 461.300
Statutes/Other Implemented: Or Const, Art XV, § 4(4),
ORS 461.190,
461.215, ORS
461.120,
461.217 &
461.300
