PUBLIC PROTECTION CABINET
Department of Charitable Gaming
(Amendment)
820 KAR 1:057. Accurate records.
RELATES
TO: KRS 238.550(5), 238.560(2)
STATUTORY
AUTHORITY: KRS 238.515(4), (9), 238.550(3)
NECESSITY,
FUNCTION, AND CONFORMITY: KRS 238.515(4) and 238.550(5) authorize the department[office]
to establish and enforce standards for accounting, recordkeeping, and reporting
to the department[office] to ensure charitable gaming receipts
are counted and reported. This administrative regulation establishes the
minimum requirements for accurate records.
Section
1. Bank Account and Records. (1) A licensed charitable gaming organization
shall maintain a single bank account for charitable gaming receipts. This
account shall be separate from any other account maintained by the
organization.
(2)
Disbursements for charitable gaming expenses and charitable donations shall be
made by check or electronic fund transfer directly from the charitable gaming
account.
(3)
All receipts from each gaming occasion shall be deposited by the second
business day following the occasion at which they were received. The deposit
for each occasion shall be made separately and shall not be combined with the
deposit from any other occasion.
(4)
All types of deposits, including startup cash, bad checks collected and check
collection fees, progressive game carry forward, and adjusted gross receipts,
shall be listed separately on the deposit reconciliation sheet, and the deposit
slip, if possible. Each individual check shall be listed separately on the
deposit slip. If a register tape is run listing the amounts of the individual
checks, it may be attached to the deposit slip. Total cash and coins shall be
listed separately. The organization shall keep a copy of the deposit slip.
(5)
Checks that have been returned for insufficient funds that have not been
collected shall be retained by the organization for three (3) years following
the close of the calendar year in which the check was issued. If the check has
been turned over to someone else for collection, the organization shall keep a
copy of the check with information regarding the person collecting the check.
(6)
Monthly bank statements and reconciliations for all accounts shall be
maintained for three (3) years following the close of a calendar year.
(7)
Copies of the fronts and backs of checks from any account into which charitable
gaming funds are deposited or transferred shall be provided to the department[office]
upon request.
(8)
Gross receipts shall include the money received from the sale of raffle
tickets, bingo cards or faces, pickle jars, bonanza balls, or hot balls,
card-minding devices, pulltabs, electronic pulltab devices and electronic
pulltabs, charity fundraising event games, special limited charity
fundraising event games, bad check collections, credit card fees and reasonable
check collection fees minus bad checks.
Section
2. Start-up Cash. (1) If the source of start-up cash is not the charitable
gaming account, the source of the start-up cash shall be identified on the
gaming occasion sheet and signed by the chairperson.
(2)
Start-up cash from one (1) organization shall not be commingled with the
start-up cash from another organization. The start-up cash shall be identified
on the check withdrawing the funds and on the deposit slip, if possible.
Section
3. Organization Records. (1) The chief financial officer shall be the custodian
of the gaming records and shall be responsible for ensuring that the records
are accurate, complete, and maintained regularly for inspection by the department[office].
(2)
An organization that hand-writes data and later enters the information onto
another form or computer program shall retain the hand-written records along
with the other form or computer generated record.
(3)
Organizations shall prepare and maintain accurate and adequate corporate or
other organizational records including articles of incorporation, minutes of
board of directors meetings, and resolutions.
(4)
Organizations shall maintain detailed records of all expenditures made in
furtherance of its charitable purpose, including all charitable contributions.
(5)
All records shall be made available for inspection and audit at the request of
the department[office].
(6)
Any organization’s records, or copies of those records, deemed necessary to
complete an inspection, audit, or investigation may be retained by the department[office]
or its employees or agents. The department[office] shall provide
a written receipt of the records at the time of removal.
(7)
Organizations shall provide records requested by the department[office],
or any of its employees, within ten (10) calendar days, unless a longer
response time is allowed by the request.
(8)
An organization shall perform an inventory and obtain permission of the department[office]
before destroying a bulk amount of gaming supplies. The gaming supplies shall
be destroyed by burning in compliance with state and federal law, shredding,
destroying or defacing in some manner to prevent reuse of any pulltab, flare,
prize board, seal card, bingo paper or any portion thereof. An organization
may also donate gaming supplies to the department for demonstration and
training purposes if the department so requests.
(9)
When an organization ceases to game, the organization shall:
(a)
Perform a final inventory;
(b)1.
Return all unused product to a distributor;
2.
Donate the product to another organization with the permission of the department
or,
if another organization does not want the gaming supplies, they may be donated
to the department, upon request, for training and demonstration purposes[office]; or
3.
Destroy the product with the permission of the department[office]; and
(c)
Spend or disburse the charitable gaming funds consistent with its charitable
purpose.
SCOTT
JONES, Commissioner
AMBROSE
WILSON IV, Secretary
APPROVED
BY AGENCY: August 12, 2015
FILED
WITH LRC: August 14, 2015 at 11 a.m.
PUBLIC
HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this administrative
regulation shall be held on September 24, 2015 at 10:30 a.m., Eastern Time at
the Department of Charitable Gaming, 132 Brighton Park Boulevard, Frankfort,
Kentucky 40601. Individuals interested in being heard at this hearing shall notify
this agency in writing by five (5) workdays prior to the hearing of their
intent to attend. If no notification of intent to attend the hearing is
received by that date, the hearing may be canceled. This hearing is open to the
public. Any person who wishes to be heard will be given an opportunity to
comment on the proposed administrative regulation. A transcript of the public
hearing will not be made unless a written request for a transcript is made. If
you do not wish to be heard at the public hearing, you may submit written
comments on the proposed administrative regulation. Written comments shall be
accepted until the end of the calendar day on September 30, 2015. Send written
notification of intent to be heard at the public hearing or written comments on
the proposed administrative regulation to the contact person.
CONTACT
PERSON: Noelle J. Bailey, General Counsel, Department of Charitable Gaming, 132
Brighton Park Boulevard, Frankfort, Kentucky 40601, phone (502) 573-5528, fax
(502) 573-6625.
REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT
Contact
person: Noelle J. Bailey
(1)
Provide a brief summary of:
(a)
What this administrative regulation does: This administrative regulation establishes standards
for accounting, recordkeeping and reporting by setting the minimum requirements
for accurate records.
(b)
The necessity of this administrative regulation: This regulation is necessary
to establish the requirements for recordkeeping for charitable gaming
licensees.
(c)
How this administrative regulation conforms to the content of the authorizing
statutes: The statutory authorities for this regulation are KRS 238.515(4),
(9), 238.550(3). KRS 238.515 (4), and (9) sets forth the powers of the
department to establish standards of accounting, recordkeeping, and reporting
to insure charitable gaming receipts are properly accounted for; and, to "promulgate
administrative regulations which are necessary to carry out the purposes and
intent of [KRS Chapter 238]." This regulation conforms to the statute by
setting out minimum standards for organizations regarding accurate records.
(d)
How this administrative regulation currently assists or will assist in the
effective administration of the statutes: This administrative regulation
facilitates effective administration of the statutes by providing the
requirements for handling and reporting money obtained in the conduct of
charitable gaming.
(2)
If this is an amendment to an existing administrative regulation, provide a
brief summary of:
(a)
How the amendment will change this existing administrative regulation: This
amendment states that electronic pulltab device and electronic pulltab sales
shall be included in gross receipts. It also allows organizations to donate
charitable gaming supplies and equipment to the department. Finally, it
corrects the improper use of "Office of Charitable Gaming" by
changing the language to "Department of Charitable Gaming." Similarly
the amendment corrects the improper labeling of the "Public Protection
Cabinet" as the "Environmental and Public Protection Cabinet."
(b)
The necessity of the amendment to this administrative regulation: This
amendment is necessary to include electronic pulltabs in gross receipts. The
amendment was further necessary to note the correct cabinet and department
names.
(c)
How the amendment conforms to the content of the authorizing statutes: The statutory
authorities for this regulation are KRS 238.515 (4), (9) and 238.550(3). KRS
238.515 (4), and (9) sets forth the powers of the department to establish and
enforce reasonable standards for the conduct of charitable gaming and the operation
of charitable gaming facilities; to establish standards of accounting,
recordkeeping, and reporting to insure charitable gaming receipts are properly
accounted for; and, to "promulgate administrative regulations which are
necessary to carry out the purposes and intent of [KRS Chapter 238]." This regulation
amendment incorporates conforms to the authorizing statute by stating what is
included in gross receipts. It also conforms by providing parameters for the
disposition of supplies and equipment when an organization no longer intends to
game. The amendment further corrects the regulation to reflect the current cabinet
and department names as stated in the statutes.
(d)
How the amendment will assist in the effective administration of the statutes: The
amendment will clarify that electronic pulltab devices and pulltabs are
included in gross receipts and will give organizations another option to donate
their supplies when they no longer intend to game. It will also now reflect the
correct agency name.
(3)
List the type and number of individuals, businesses, organizations, or state
and local governments affected by this administrative regulation: This
amendment will impact licensed charitable organizations. There are currently
603 licensed charitable organizations.
(4)
Provide an analysis of how the entities identified in Question (3) above will
be impacted by either the implementation of this administrative regulation, if
new, or by the change, if it is an amendment, including:
(a)
List the actions that each of the regulated entities identified in Question (3)
will have to take to comply with this administrative regulation or amendment:
The organizations will have additional options to get rid of supplies when they
quit gaming. They will also be required to report electronic pulltab sales in
their gross receipts.
(b)
In complying with this administrative regulation or amendment, how much will it
cost each of the entities identified in Question (3): There should be no cost
to the organization.
(5)
Provide an estimate of how much it will cost to implement this administrative
regulation:
(a)
Initially: There will be no cost to implement this amendment to the
administrative regulation.
(b)
On a continuing basis: There should be no additional cost on a continuing
basis.
(6)
What is the source of the funding to be used in the implementation and
enforcement of this administrative regulation: There is no additional funding
necessary to implement this amendment to the administrative regulation. There
will be no additional funding necessary to enforce the provisions of the
amended regulation.
(7)
Provide an assessment of whether an increase in fees or funding will be
necessary to implement this administrative regulation, if new, or by change, if
it is an amendment: There will be no increase in fees or funding necessary to
implement this amendment to the administrative regulation.
(8)
State whether or not this administrative regulation establishes any fees or
directly or indirectly increases any fees: This amendment to the regulation
does not establish any new fees or directly or indirectly increase any fees.
(9)
TIERING: Is tiering applied? No. Only licensed charitable organizations are
affected by this regulation and it applies equally to all.
FISCAL NOTE ON STATE AND LOCAL GOVERNMENT
1.
What units, parts, or divisions of state or local government (including cities,
counties, fire departments, or school districts) will be impacted by this
administrative regulation? The Kentucky Department of Charitable Gaming as
implementer of this regulation.
2.
Identify each state or federal statute or regulation that requires or
authorizes the action taken by the administrative regulation. KRS 238.515 and
KRS 238.550.
3.
Estimate the effect of this administrative regulation on the expenditures and
revenues of a state or local government agency (including cities, counties,
fire departments, or school districts) for the first full year the
administrative regulation is to be in effect. There should be no effect on the
expenditures or revenues of any government agency.
(a)
How much revenue will this administrative regulation generate for the state or
local government (including cities, counties, fire departments, or school
districts) for the first year? The amendment to the regulation should not
generate revenue in the first year or in subsequent years.
(b)
How much revenue will this administrative regulation generate for the state or
local government (including cities, counties, fire departments, or school
districts) for subsequent years? See response to (a) above.
(c)
How much will it cost to administer this program this program for the first
year? It is not anticipated that that there will be any cost in administering
the program that this regulation relates to.
(d)
How much will it cost to administer this program in subsequent years? See
response to (c) above.
Note: If specific dollar estimates
cannot be determined, provide a brief narrative to explain the fiscal impact of
this administrative regulation.
Revenues
(+/-): Not applicable; see response to (c) above.
Expenditures
(+/-): Not applicable; see response to (c) above.
Other
explanation: There should be no fiscal impact.
