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November 21, 2016 CSI Filing: Five-Year Review (Batch 5)

Created by Executive Order 2011-01K, the Common Sense Initiative (CSI), and Senate Bill 2 of the 129th General Assembly, require state agencies, including the Casino Control Commission, to draft rules in collaboration with stakeholders, assess and justify any adverse impact on the business community (as defined by Senate Bill 2), and provide opportunity for the affected public to provide input on the rules. 

The Ohio Casino Control Commission submitted the following proposed rules to the CSI office for review on November 21, 2016:

 

Brief Explanation of the Rules 

This is the Commission’s fifth package of five-year review rules for 2016. This batch includes rules relating to electronic gaming equipment, promotional activities, and certified independent testing laboratories. Many of the changes are small housekeeping amendments to clean up and clarify rule language. Several of the amendments remove the terms “applicant or licensee” and instead use the name of the entity in an effort to streamline and clarify Ohio Adm. Code 3772 in its entirety. Another consistent change ensures that provisions of general applicability apply to all Commission rules by replacing the words “this chapter” with “rules adopted by the commission.”

3772-09 Gaming Supplies, Devices & Equipment (6 rules)

  • 3772-9-03 (amendment), titled “Testing.” This rule requires all gaming-related devices, software, hardware, and technology to be tested by a certified independent testing laboratory before they are included in the Commission’s database of approved equipment. The rule further specifies that the equipment will not be included in the database unless the lab concludes that the equipment is compliant with R.C. Chapter 3772. and the administrative rules adopted thereunder, and is approved by the Commission. The amendments to this rule are largely intended to streamline the code by moving language regarding testing results to this rule from Ohio Adm. Code 3772-9-04 and rescinding that rule. Finally, the rule adds a requirement that the vendor of such equipment seeking testing must also submit information to the Commission, if requested, allowing the Commission to make its own informed, independent determination. The purpose of this rule is to implement the statutory requirement that gaming-related equipment be tested by certified independent laboratories under R.C. 3772.03(D)(4) and R.C. 3772.31.
  • 3772-9-04 (amendment), titled “Testing results.” This rule is being rescinded and reserved. The requirement that only equipment that has been approved by both the certified independent testing laboratory and the Commission before the equipment can be included on the Commission’s list of approved equipment has been moved to Ohio Adm. Code 3772-9-03. The purpose of the amendment is to streamline Ohio Adm. Code 3772.
  • 3772-9-05 (amendment), titled “Transportation of electronic gaming machines to and from a casino facility.” This rule specifies how electronic gaming equipment is to be transported and stored. Broadly, the rule requires notice to the Commission of the transportation, written approval from the Commission, and the presence of a Commission staff member when a shipment is received by a casino operator. The amendments to this rule narrow the presently broad applicability of this rule from all electronic gaming equipment to only electronic gaming machines, a newly defined term, in addition to some rearrangement and clarifying changes.  This amendment will remove the notification requirement for the shipment of individual pieces of hardware and focuses instead on slot machines and mechanical, electromechanical, and electronic table games.  The purpose of this rule is to ensure that all electronic gaming machines shipped or received by casino operators or gaming-related vendors are accounted for and not tampered with during transport, ensuring that when the machine arrives at its destination, it is still in compliance with the technical standards required under R.C. Chapter 3772. and the rules adopted thereunder.
  • 3772-9-06 (amendment), titled “Possession and storage of slot machines.” This rule relates to how electronic gaming equipment can be possessed or stored. The rule generally requires the equipment to be possessed only by licensed entities or by others as is necessary and appropriate to fulfill the goals and objectives of R.C. Chapter 3772. and the rules adopted thereunder. Further, the Commission must be provided with an inventory list of all electronic gaming equipment so possessed. Storage must occur in a secure area, approved by the Commission. The amendments to this rule consist of some streamlining and clarifying changes, including clarifying that the rule applies only to such equipment used for any gaming activity, in addition to several changes aimed at providing more flexibility to stakeholders and the Commission in how the inventory list is kept and how the machines are stored. The purpose of this rule is to ensure that electronic gaming equipment used for any gaming activity is only possessed by those authorized under R.C. Chapter 3772. and the rules adopted thereunder and that such equipment is not tampered with and maintains compliance with the technical standards required under R.C. Chapter 3772. and the rules adopted thereunder.
  • 3772-9-07 (amendment), titled “Transportation of electronic gaming equipment to and from a certified independent testing laboratory located in this state.” This rule provides an exception from the provisions of Ohio Adm. Code 3772-9-05 and 3772-9-06 for certified independent testing laboratories located in this state solely for the purpose of testing electronic gaming equipment. The purpose of this rule is to exempt certified independent testing laboratories in this state from the requirements of Ohio Adm. Code 3772-9-05 and 3772-9-06, while ensuring that all electronic gaming equipment meets the technical requirements of R.C. Chapters 2915., 3769., 3770., and 3772., and the rules adopted thereunder.  The only amendment to this rule is the removal of the terms “licensee or applicant,” as described above.
  • 3772-9-12 (amendment), titled “Game authentication.” This rule provides the authentication requirements that electronic gaming equipment must support, so that the Commission and certified independent testing laboratories can verify the electronic gaming equipment’s critical program storage media. The rule also provides some grandfathering provisions for electronic gaming equipment that was submitted for approval before December 1, 2012. The amendments to this rule provide for a waiver from some of the general requirements if requested in writing and also remove some authentication requirements. The purpose of this rule is to ensure that all electronic gaming equipment can be verified by the Commission and certified independent testing laboratories as containing critical program storage media compliant with R.C. Chapter 3772. and the rules adopted thereunder.

3772-13 Advertising (1 rule)

  • 3772-13-03, titled “Promotional activities.” Presently, this rule specifies that each casino operator must submit written internal controls for all promotional activities to the Commission and outlines specific criteria the internal controls must include. The rule further details specific standards every promotional activity must meet and provides the guidelines casinos must follow when issuing these promotions. The purpose of this rule is to protect Ohio patrons from deceptive and misleading promotional activities, as well as to ensure a uniform, easily audited system of issuing promotions.  The only amendment to this rule extends the time period for which a casino operator must retain records of promotional documents from two years to five years to mirror the general required retention period for casino operators.

3772-15 Independent Testing Laboratories (6 rules)

  • 3772-15-01 (amendment), titled “Independent testing laboratory certification.” This rule allows independent testing laboratories to apply for certification to the Commission to test electronic gaming equipment for compliance with R.C. Chapter 3772. and the rules adopted thereunder. The amendment to this rule specifies that if the Commission certifies independent testing laboratories to test skill-based amusement machines for compliance with R.C. 2915 and R.C. 3772 and the rules adopted thereunder that such certification does not grant authority to test electronic gaming equipment. The purpose of this rule is to carry out the Commission’s statutory mandate to certify independent testing laboratories under R.C. 3772.31.
  • 3772-15-02 (amendment), titled “Independent testing laboratory information, certification period, and certification renewal.” This rule provides for the process by which a independent testing laboratory can be certified by the Commission. The certification lasts for three years, and the laboratory must provide the Commission with all documents necessary for the Commission to investigate the laboratory. Finally, the rule provides for a process by which confidential information will be handled in dealing with public records requests. The amendment to this rule removes superfluous steps in the public records process, while still ensuring that R.C. 149.43 and R.C. 1333.61 are met. A similar change has been made throughout Ohio Adm. Code 3772, during the five-year review process. The purpose of this rule is to ensure the Commission can properly investigate, on an ongoing basis, certified independent testing laboratories to ensure they meet the requirements under R.C. 3772.31 and Chapter 3772-15 of the Ohio Adm. Code. 
  • 3772-15-03 (amendment), titled “Certification fees.” This rule provides that each independent testing laboratory applying for certification shall pay a $2,000 fee, which may be increased if the cost of investigation exceeds the fee. The amendment to this rule clarifies that while the Commission is waiting for a testing laboratory to submit any additional certification fee, the Commission may continue its investigation of the laboratory, but may not certify the laboratory. A similar change has been made throughout Ohio Adm. Code 3772, during the five-year review process. The purpose of this rule is to ensure that the Commission has the funding necessary to properly investigate and certify independent testing laboratories.
  • 3772-15-04 (amendment), titled “Background investigation of an independent testing laboratory.” This rule provides the factors the Commission will consider when conducting a background investigation of an independent testing laboratory, including the laboratory’s ability to test for the technical requirements under R.C. Chapter 3772. and the rules adopted thereunder, the lab’s corporate structure, its policies and procedures, its staff experience and expertise, and its equipment. The amendments to this rule are simple housekeeping amendments meant to streamline rule language and fix typographical errors. The purpose of this rule is to provide guideline by which laboratories will be evaluated when applying for certification, so as to ensure the requirements of R.C. 3772.31 and Ohio Adm. Code 3772-15 are met.
  • 3772-15-05 (amendment), titled “Conditions of certification.” This rule provides the conditions certified independent testing laboratories must agree to in order to obtain and maintain certification. These conditions include, among others, obtaining professional liability insurance, ensuring consistent testing, maintaining accreditation, maintaining testing records, and providing assistance to the Commission. The amendments to this rule consistent of streamlining and clarifying amendments. Additionally, the rule extends the records retention period for certified independent testing laboratories to five years to be consistent with the general records retention period and requires laboratories to maintain a database of reports that the Commission may access. The purpose of this rule is to ensure that certified independent testing laboratories meet the requirement of R.C. 3772.31 and Ohio Adm. Code Chapter 3772-15.
  • 3772-15-06 (amendment), “Duties of a certified independent testing laboratory.” This rule provides for the general duties of a certified independent testing laboratory. These duties include to test electronic gaming equipment for compliance with R.C. Chapter 3772 and the rules adopted thereunder; providing reports to the Commission of test results; serving as a witness in legal proceedings; and internal procedures to ensure the suitability of the laboratories’ procedures, equipment, and employees. The amendments to this rule are largely streamlining and clarifying amendments, including clarifying that until electronic gaming equipment is approved by the Commission and in the Commission’s database under Ohio Adm. Code 3772-9-02, it is not approved for use in Ohio. The purpose of this rule is to ensure the ongoing ability and suitability of certified independent testing laboratories to test for compliance under R.C. Chapter 3772. and the rules adopted thereunder, as required by R.C. 3772.31.

Associated CSI Documents
Business Impact Analysis

Contact Information for Comments

The Commission welcomes comments regarding these proposed rules. To ensure your comments are considered as part of the Common Sense Initiative (“CSI”) review period, the Commission should receive them no later than December 5, 2016.

Any questions or comments with respect to these rules may be directed to William Cox via email at William.Cox@casinocontrol.ohio.gov or U.S. Mail at 10 West Broad Street, 6th Floor, Columbus, Ohio 43215. Comments may also be directed to the CSI Office at csipubliccomments@governor.ohio.gov.


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