Date of Adoption: April 14, 2000.

Purpose: To implement legislation that passed in 1996 (SSB 6430) and 1997 (SSB 5560) card rooms to offer the following: Increased number of tables, alternative collection of fees, jackpot schemes and house banked card games. These rules set forth the regulatory and licensing requirements for card rooms to offer these activities.

Citation of Existing Rules Affected by this Order: Repealing WAC 230-40-015, 230-40-060, 230-40-150, 230-40-160, 230-40-900, 230-02-400, 230-02-425; and amending WAC 230-40-010, 230-40-030, 230-40-050, 230-40-070, 230-40-120, 230-40-130, 230-40-200, 230-40-225, 230-40-400, 230-50-010, 230-02-110, 230-02-415, 230-04-022, 230-04-140, 230-04-255, 230-04-450, 230-08-040, 230-08-090, 230-08-160, 230-12-050, and 230-40-125.

Statutory Authority for Adoption: RCW 9.46.070.

Adopted under notice filed as WSR 00-05-101 on February 16, 2000, with a publication of March 1, 2000.

Changes Other than Editing from Proposed to Adopted Version: In the past, game starters (also referred to as "shills") had to be licensed as card room employees. This requirement was inadvertently removed when this rule was amended in January 1998. It is important that people that are facilitating card games meet the same requirements as other card room employees. Therefore, we have added language to require them to be licensed. Washington Blackjack was not repealed; however, no new licenses for the game will [be] issued, only card rooms operating the game on April 1, 2000, shall be allowed to offer it.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 40, Amended 21, Repealed 7.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 7.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 40, Amended 21, Repealed 7; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0. Effective Date of Rule: Thirty-one days after filing.

April 14, 2000

Susan Arland

Rules Coordinator

OTS-4001.1

AMENDATORY SECTION(Amending Order 373, filed 6/15/99, effective 8/1/99)

WAC 230-40-010
Social card games -- Rules of play -- Types of card games authorized.

Social card games shall be played using rules and procedures as set forth in this section. Only card games that have been specifically authorized are allowed to be played in public or social card rooms ((licensed by the commission)). ((The commission hereby authorizes the following card games:))

(1) Social card games shall be played in the following manner:

(a) The game must be played with one or more standard decks of playing cards: Provided, That cards may be removed to comply with rules of a specific game, such as pinochle;

(b) Players shall compete against all other players on an equal basis for nonhouse-banked games or against the licensee for house-banked games;

(c) Each player shall receive their own hand of cards and be responsible for decisions regarding such hand, such as whether to fold, discard, draw additional cards, or raise the wager;

(d) Players shall not place wagers on any other player's or the house's hand and no side bets between players are allowed: Provided, That the following shall not be in violation of this section:

(i) An insurance bet placed in the game of blackjack;

(ii) A tip wager made on behalf of a dealer; or

(iii) "Envy" provisions which allow a player to receive a prize if another player wins a jackpot or odds wager;

(e) A player's win or loss shall be determined during the course of play of a single card game;

(f) No more than two separate games shall be played with a single hand of cards. For purposes of this section, bonus features and progressive jackpots are considered a game: Provided, That bonus features that allow a player to receive an additional prize if another player achieves a specific hand, such as "envy" or "share the wealth" features, shall not be considered a separate game if the player does not have to place a separate wager to participate; and

(g) The rules of play for each specific game played at a licensed card room shall be maintained on the licensed premises and immediately available for review by commission staff, local law enforcement, or a player upon request. Commission staff shall approve any modification to such rules prior to implementation. In addition, any rules related to wager or prize pay out restrictions shall be clearly posted in the immediate area of such games.

(2) Nonhouse-banked card games shall only be played in the manner set forth in The New Complete Hoyle, Revised, Hoyle's Modern Encyclopedia of Card Games, or a similar authoritative book on card games approved by the director: Provided, That each licensee may make immaterial modifications to each authorized game set out in Hoyle. The following nonhouse-banked card games are authorized:

(a) Poker (( - Any poker game described in Hoyle's Modern Encyclopedia of Card Games, by Walter B. Gibson, published by Doubleday and Company, Inc., April 1974, 1st edition, pages 219 through 277.));

(((2))) (b) Hearts((.));

(((3))) (c) Pinochle((.));

(((4))) (d) Cribbage((.));

(((5))) (e) Rummy((.));

(((6) Pan.

(7))) (f) Panguingue (Pan);

(g) Pitch((.));

(((8) Washington blackjack - as set forth in WAC 230-40-125.

(9) Pan-9.

(10))) (h) Bid Whist((.));

(((11) Those games the director approves on a temporary, case-by-case basis.      An application)) (i) Washington blackjack, if the business was licensed and operating the game on April 1, 2000, and under the restrictions set forth in WAC 230-40-125;

(j) Other games or modifications to approved games may be approved by the director, or the director's designee, on a case-by-case basis. Requests for approval of a game must be submitted in writing, and include the rules of play and all wagering schemes. ((Temporary approvals granted are valid for no more than six months or until adopted by the commission, whichever occurs first.))

(3) House-banked card games shall be approved by the director, or the director's designee, on a case-by-case basis. Request for approval of a house-banked card game must be submitted in writing, including the rules of play and all wagering schemes. A list of all approved games, modifications to games, and rules of play shall be available at all commission offices. The director may approve games in which the determination of whether a player wins or loses depends upon one or more of the following:

(a) The player's hand is a specific:

(i) Pattern or ranking of cards (pair, straight, flush, royal flush, etc.);

(ii) Combination of cards (two queens of hearts, ace and jack of spades, three sevens, etc.); or

(iii) Value of the cards (seventeen, twenty-one, etc.); and/or

(b) The player has a higher ranking or value hand than the house/dealer/banker.

(4) Once a game is approved for play, the director shall not remove it from the authorized list of games without providing licensees written notice. Licensees shall be afforded an opportunity to object to the director's decision. If an objection is filed, an administrative law judge shall review the director's decision utilizing the brief adjudicative procedures set forth in WAC 230-50-010.

(5) The licensee shall be notified in writing when the director denies a request for a new game or modification of a game. The notification shall include reasons for the denial and provide the petitioner all information necessary for a formal petition to the commission for rule making, amendments, or repeal, as set forth in WAC 230-50-800.

[Statutory Authority: RCW 9.46.070.      99-13-103 (Order 373), § 230-40-010, filed 6/15/99, effective 8/1/99.      Statutory Authority: RCW 9.46.0281, 9.46.070 (1), (2), (14) and (20).      96-11-073, § 230-40-010, filed 5/13/96, effective 7/1/96.      Statutory Authority: RCW 9.46.070.      94-13-098 (Order 252), § 230-40-010, filed 6/15/94, effective 7/16/94.      Statutory Authority: RCW 34.05.220(4), [34.05].230 and 9.46.070 (11) and (14).      90-05-032 (Order 205), § 230-40-010, filed 2/14/90, effective 3/17/90.      Statutory Authority: RCW 9.46.070.      88-19-038 (Order 183), § 230-40-010, filed 9/13/88.      Statutory Authority: Chapter 9.46 RCW.      86-19-056 (Order 161), § 230-40-010, filed 9/15/86.      Statutory Authority: RCW 9.46.070(11).      82-23-050 (Order 125), § 230-40-010, filed 11/15/82.      Statutory Authority: RCW 9.46.070(10) (see RCW 9.46.020(20)).      80-09-067 (Order 103), § 230-40-010, filed 7/17/80; Order 78, § 230-40-010, filed 11/17/77; Order 67, § 230-40-010, filed 3/11/77; Order 40, § 230-40-010, filed 6/26/75; Order 23, § 230-40-010, filed 9/23/74.]

OTS-3684.1

REPEALER

     The following section of the Washington Administrative Code is repealed:

WAC 230-40-015

Rules by which the authorized card games shall be played.

OTS-2826.1

REPEALER

     The following sections of the Washington Administrative Code are repealed:

WAC 230-40-060	Persons shall not share in winnings or charge additional fee for playing cards.
WAC 230-40-150	Side bets prohibited.
WAC 230-40-160	Wagers by other than participants prohibited.
WAC 230-40-900	Public card room enhancement program -- Pilot study.

OTS-2901.3

AMENDATORY SECTION(Amending Order 184, filed 10/24/88)

WAC 230-40-030
Number of tables and players limited.

(((1))) No licensee ((to allow a public card room on its premises)) shall allow more than ((five)) fifteen separate tables at which card games are played((, nor)). No licensee shall allow more than ten players for nonhouse-banked card games and seven players and/or areas for wagering at house-banked card games to participate at any one table at any given time.      ((Provided: When poker is played, additional players are authorized to participate at the card table(s) as follows;

(a)Class E-12 players

(b)Class E-2 thru E-5

and Class D4 players

Provided further, that no table shall have more then twelve players.

(2) No licensee to allow a social card room on its premises shall allow more than ten players to participate at any one table at any given time.      Provided, when poker is played, they may have two tables with 12 players at each table.

(3) The commission may permit a licensee to exceed the player limits on specific occasions for good cause shown.      Requests to exceed the limit shall be submitted to the commission in writing not less than 30 days preceding the date upon which the licensee wishes to exceed the limit.      The request shall indicate the date(s) involved, the reasons why the request is made, and the number of games and players in the games which the licensee desires to allow on that occasion)) Each table shall be permanently numbered and readily identifiable by the licensee's surveillance system.

[Statutory Authority: RCW 9.46.0281 and 9.46.070 (11), (12) and (14).      88-22-019 (Order 184), § 230-40-030, filed 10/24/88.      Statutory Authority: RCW 9.46.010 and 9.46.070 (8) and (14).      85-03-025 (Order 143), § 230-40-030, filed 1/9/85; Order 23, § 230-40-030, filed 9/23/74.]

OTS-3725.1

NEW SECTION
WAC 230-40-040
Fees for house-banked card games -- Prohibited -- Exception.

No person shall be charged a fee, directly or indirectly, to participate in house-banked card games: Provided, That a licensee may collect a commission of not more than five percent from a winning hand of pai gow poker.

[]

OTS-2902.5

AMENDATORY SECTION(Amending Order 300, filed 9/18/96, effective 10/19/96)

WAC 230-40-050
Fees for nonhouse-banked card playing -- Method of assessment and collection -- Maximum fees.

((Except as provided in WAC 230-40-055 for card tournaments, no time based or per hand fee shall be charged a person, directly or indirectly, to play in a card game except as set forth in this section.      Each type of fee shall be maintained and recorded separately from all other fees as set forth in WAC 230-08-090, and be available for audit by the commission and local law enforcement and taxing authorities.

(1) For all card games, the following procedures apply to collection of such fees:

(a) Fees shall be collected in advance by the licensee in cash, or in wagering chips, directly from the player;

(b))) No person shall be charged a fee, directly or indirectly, to play in a nonhouse-banked card game in excess of those fees set forth in this section. Each type of fee shall be maintained and recorded separately from all other fees and be available for audit by commission staff, local law enforcement, and taxing authorities.

(1) The following are authorized methods of assessing fees for playing social card games. Only one method of assessing fees may be used at a table at any given time:

(a) Fees based on a period of time - A specific fee of not more than ten dollars per hour, per player, may be charged to play social card games: Provided, That a licensee may collect the hourly fee in thirty-minute increments;

(b) Fees for each hand played - A specific fee of not more than one dollar per hand, per player, may be charged to play social card games;

(c) Fees based on the amounts wagered during a hand (rake) - A portion of the total amount wagered by a player, not to exceed five dollars per hand or ten percent of total wagers for a hand, whichever is less, may be collected for playing social card games; or

(d) Fees to enter tournaments shall be as set forth in WAC 230-40-055.

(2) Fees shall be collected by a licensed card room employee in the following manner:

(a) Fees assessed on a period of time shall be collected directly from each player by the dealer or floor supervisor responsible for that particular section of the card room. The "direct collection," "chip rack," or "drop box" methods set forth in this section may be used for collection of fees assessed on a period of time;

(b) Fees assessed on a per-hand basis shall be placed in a designated area of the table by the player and collected by the dealer before the first round of cards has been dealt. After collection, the dealer shall deposit all chips or coins in the chip rack or drop box, as applicable;

(c) Fees assessed on the amounts wagered during a game shall be collected by the dealer during play of the hand and placed in a designated area of the table. Once the maximum fee for a hand is accumulated, the dealer shall spread the chips or coins to allow players and the surveillance system the ability to verify the amount collected. After verification, chips shall be deposited in the dealer's chip rack or drop box, as applicable;

(d) All fees to enter tournaments shall be collected in advance of the start of play in accordance with WAC 230-40-055; or

(e) Licensees may apply to the director for approval of alternate fee collection methods. If approved, the method of collection shall be set forth in the letter granting approval.

(3) All fees collected from players shall be maintained and recorded as set forth in WAC 230-08-090. All collections shall be kept separate from all other chips and cash in the card room until recorded in the daily card room records and deposited in the cashier's cage. All chips and cash in the cashier's cage shall be kept separate from all other chips and cash located on the licensed premises at all times card games are conducted. The following methods may be used for control of fees collected for card games:

(a) Direct collection method - Fees are collected directly from each player by a licensed card room employee responsible for that particular section of the card room and deposited in the card room cage serving the area of the card room from which collections are made. Collections shall be made at least once per hour, at times designated by the licensee. All fees shall be recorded immediately upon collection, per WAC 230-08-090. This collection method may only be used when assessing fees based on a period of time.

(b) Chip rack method - This method is allowed for licensees that are licensed with three or fewer tables. It requires a licensed center dealer, a game lay-out with a designated area for player fees, and a chip rack separated into sections for each type of fee collected. Fees are temporarily stored in the chip rack and controlled by a licensed dealer until collected by the floor supervisor. All chips collected as fees shall be removed from the dealer's chip rack at least every four hours by the licensed card room employee responsible for that particular section of the card room. The removal process shall include the counting of chips and coins in the presence of players and immediately recording the totals on the record prescribed by the commission. The dealer and the supervisor making the removal shall each initial the prescribed record verifying its accuracy.

(c) Drop box method - Fees are temporarily stored in a numbered, locked drop box. The drop box method requires a center dealer, a table with a designated area for each type of player fee and/or fees removed from the pot, and a separate drop box for each type of fee. Drop box movement, storage, and counting shall be conducted as prescribed in WAC 230-40-840. The drop box shall be located in a position that is isolated from the pot area and in plain view of all players and the surveillance system.

(4) No player shall be required to pay for or purchase any other goods or services as a condition of playing cards ((except as authorized by this section)): Provided, That:

(a) A bona fide nonprofit or charitable organization may charge its usual membership fee to belong to the organization; and

(b) Licensees may collect an admission fee when providing entertainment, as long as the fee is charged to all patrons;

(((c))) (5) A schedule setting forth all fees to participate in card games shall be posted in plain view where it can be seen by the players in the card games((.));

(((2))) (6) A person requesting a new deck of cards beyond those regularly furnished by the ((operator, as required by WAC 230-40-070(2),)) licensee may be charged a fee not to exceed the actual cost to the licensee ((of)) for the deck.      ((Further,)) Class D licensees may charge a fee not to exceed actual cost to the licensee per deck for each deck of playing cards furnished to a table as required by these rules, or as requested by any player at the table.      The fee shall be collected in cash directly from the players, or the player requesting the deck, at the time the deck is introduced into the game((.));

(((3) This rule shall not prevent a bona fide nonprofit or charitable organization which has been established and operated for purposes other than card playing from charging its usual membership fee to belong to the organization.

(4))) (7) The licensee shall collect the same fee from all players at a table ((except licensed card room employees or the licensed owner)).      If the licensee elects to allow free play, then all players at a table must be allowed to play for free((.

(5) The amount collected shall be recorded by the licensee each half hour on forms supplied by the commission.

(6) All records required by this rule shall be maintained for a period of three years from the end of the licensee's fiscal year for which the record is kept.

(7) This rule shall not prevent a licensee from collecting an admission fee for entry into that portion of the licensed premises conducting entertainment, provided that the same fee is charged to all patrons)): Provided, That a licensee may allow licensed card room employees and owners to play without a fee if fees are based on time, as authorized by subsection (1)(a) of this section.

[Statutory Authority: RCW 9.46.0281, 9.46.070 (1), (2), (4)-(8), (11), (12), (14) and (20).      96-19-082 (Order 300) § 230-40-050, filed 9/18/96, effective 10/19/96.      Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-050, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      94-17-091 (Order 256), § 230-40-050, filed 8/16/94, effective 9/16/94.      Statutory Authority: RCW 9.46.070 (1), (2), (4), (5), (6), (9), (11), (14) and (17) and 9.46.020 (19) and (23).      85-17-015 (Order 153), § 230-40-050, filed 8/12/85.      Statutory Authority: RCW 9.46.020 (20)(d), 9.46.050(3) and 9.46.070 (1), (2), (5), (8), (9), (11) and (12).      85-03-026 (Order 144), § 230-40-050, filed 1/9/85.      Statutory Authority: RCW 9.46.070 (8) and (17).      83-23-055 (Order 138), § 230-40-050, filed 11/15/83.      Statutory Authority: RCW 9.46.070(11).      82-11-028 (Order 120), § 230-40-050, filed 5/11/82; 80-09-067 (Order 103), § 230-40-050, filed 7/17/80; Order 72, § 230-40-050, filed 7/26/77; Order 42, § 230-40-050, filed 9/18/75; Order 38, § 230-40-050, filed 5/9/75; Emergency Order 37, § 230-40-050, filed 5/9/75; Order 35, § 230-40-050, filed 3/14/75; Order 29, § 230-40-050, filed 1/23/75; Order 23, § 230-40-050, filed 9/23/74.]

OTS-3991.2

AMENDATORY SECTION(Amending Order 374, filed 6/15/99, effective 8/1/99)

WAC 230-40-125
Washington blackjack -- Rules of play -- Wagering limits.

Washington blackjack shall not be allowed unless a business is licensed and operating the game prior to April 1, 2000.

(1) Fees to play Washington blackjack shall only be assessed on a time basis and collected using the direct method as defined in WAC 230-40-050. Washington blackjack is a nonhouse banking card game permitted in Class A and E card rooms.      Washington blackjack shall be played in the following manner:

(2) No more than two standard fifty-two-card decks shall be used with suits disregarded and each card valued numerically only as follows: Ace equal 1 or 11; face cards (King, Queen, Jack) equal 10 each; others according to their spots, 10 to 2.      The number of decks used shall be established by house rule.      The cards shall be dealt from a shoe at all times.      The game is played with a player who deals the cards and banks the game (dealer/banker).

(3) When starting a new table the cards are cut to determine who the first banker will be.      The dealer/banker shall announce the amount of money that he or she will put into the bank. If a minimum bank is established as per individual house rule, it shall not exceed ((five)) two hundred fifty dollars.     

(4) Once the bank has been established, the player to the immediate left of the dealer/banker places his/her wager on the bet line and the dealer/banker covers that wager by matching it with a like amount of chips.      Each player makes their wager in turn and each wager is immediately matched by the dealer/banker.      The maximum and minimum wager may be set by house rule but in no event shall the maximum wager exceed twenty-five dollars.      If the bank runs out of money (tapped out) prior to the commencement of the deal, then only those players with a wager covered will be dealt a hand.     

(5) The play begins with the dealer/banker dealing one card face up to each covered player including himself/herself, one more card face up to each covered player, and then one down card to himself/herself.      A player may be dealt more than one hand by house rule.      If a player holds an ace and a face card or a ten, it is a "natural" 21 and the player collects one and one-half times the amount of their bet from the dealer/banker, unless the dealer/banker also has a natural which results in a tie (push).      All ties result in the players and the dealer/banker recovering their wagers.

(6) If the dealer/banker's face-up card is a ten, face card or ace, he/she shall look at the face-down card to see if he/she has a natural; if the face-up card is anything else, he/she may not look at the face-down card until his/her turn to draw. If the dealer/banker has a "natural," he/she collects the wagers from players who do not have a "natural." If the dealer/banker does not have a "natural," he/she pays off any player with a "natural" starting with the first one to the left of the dealer/banker.      Should the dealer/banker not have enough money in the bank to make up the one and one-half for one payoff due on a "natural," then those hands and wagers will be frozen in place until the additional wagers are made up or the hand is over.      If after the hand is over, a dealer/banker cannot cover the one and one-half for one, the player shall get the amount of wager that was covered by the dealer.

(7) If the dealer/banker's face-up card is an ace, the licensee, by house rule, may allow the player banking the game to offer an "insurance" bet against losing to the dealer/banker's possible "natural." The dealer/banker, before looking at his down card, inquires if any player wants insurance. A player who desires insurance places an amount equal to half his/her present wager on his/her own hand. When this bet is made, the dealer/banker looks at his/her down card. If it is a 10 count, the dealer/banker turns it face up and announces a "natural." The insurance bettor is paid off at a rate of 2 to 1 and, unless they have a "natural," lose their original wager. If the dealer/banker's down card is not a 10 count card, the player loses his/her insurance bet and continues playing on their original wager.

(8) If the dealer/banker does not have a "natural," play continues with the player on the dealer/banker's immediate left.      The dealer/banker deals cards face up, one by one, as that player calls for them.      The player's aim is to total 21 or as close to 21 without going over.      When a player is satisfied with their total, they shall declare "stand." If the player wants more cards, the player declares "hit." If a player goes over a 21 point count, the hand is a "bust" and they must turn the hand down, while the dealer/banker collects the bet.      The dealer/banker does the same with each remaining player.      Any player who stands must wait while the dealer/banker draws his or her cards.      If the dealer/banker goes bust, each standing player is paid the amount of their wager.      If the dealer/banker "stands," the down card is turned up and players whose totals are higher than the dealer/banker's are paid.      The dealer/banker collects from any player whose total is less.      Action is always to the left of the dealer/banker.      Any frozen wagers needing to be "made up" will be done in order, to the left of the dealer/banker from losing wagers the dealer/banker collects.

(9) Should the dealer/banker not be able to cover all frozen wagers then those frozen wagers are released to the winning players and the deal passes immediately to the left at which time the new dealer/banker shall announce the amount of the bank and shuffle the cards.      The same shall apply if the dealer/banker has no money in the bank.      The dealer/banker may, if allowed by house rule, add to their bank in between hands.

(10) Upon completion of the shuffle, the player to the right of the dealer/banker shall cut the cards.      After the cards have been placed into the shoe the dealer/banker shall insert a blank card approximately three quarters of the way through the deck(s).      A dealer/banker may deal from the shoe until he/she reaches the blank card.      After the blank card appears, the dealer/banker may continue dealing that hand, but will not start a new hand.      The player on the dealer/banker's immediate left shall be offered the opportunity to be the next dealer/banker.      The discards may only be reshuffled to complete the last hand.

(11) Once wagers are placed and covered on the bet line, no player, including the dealer/banker, may touch those wagers until the winner has been determined.      Any player touching the wagers may be ruled to have fouled and their wager forfeited.

(12) Any player who lifts their cards up from the table or slides their cards out of their own playing area shall be ruled to have fouled and their wager may be forfeited.

(13) No player may "buy" the bank.      The deal must pass around the table to the left and no person can authorize another person to deal for him or her. No player may be the banker for more than one consecutive shoe before passing the bank. A new player entering the game may not participate as the dealer/banker until at least two other players have dealt. If a player does not wish to deal and passes the deal, that player may not play in the first two hands conducted by the next dealer/banker. A dealer/banker may, after completing one full hand, pass the deal and be able to participate in the next hand.

(14) The dealer/banker must stand on seventeen or above and must take hits on sixteen or below.      If a dealer/banker has an ace, it shall be counted as eleven if it brings his or her total to seventeen or more (but not over twenty-one).      Provided, That the licensee, by house rule, may allow play of a "soft seventeen," which occurs when the dealer/banker's first two cards are an ace valued at eleven and a six.      If the licensee elects to play a soft seventeen, house rules must specify that the dealer/banker must hit a soft seventeen, and must stand on a hard seventeen and any eighteen or above.      House blackjack rules must be posted in plain view to the players and the house must ensure they are consistently followed.

(15) The conditions for doubling down shall be set by house rule, provided that the wager may be doubled and the player received only one more card.      The player must then stand on those three cards.      If the dealer's bank is insufficient to cover a double down wager, the player may wager an amount equal to the dealer's remaining bank.      The dealer must then cover that wager.      If the dealer has no bank then a player may not double down.

(16) If a player's first two cards are a pair, then that player may split the pair into two separate hands.      The amount of the player's original bet then goes on one of the cards, and they must place an equal amount as a bet on the other card. If the dealer/banker does not have enough in their bank to cover the doubled bet, the dealer/banker must cover an amount equal to the value of their remaining bank.      The player then has the option to divide the wagers in any manner between the two hands, not to exceed the allowable limit per hand.      If the dealer/banker has no bank then the player may divide their wager in any manner between the two hands, unless the player's original bet was a minimum allowed in that game then they may not split their pair.      Additional splits shall be determined by house rule.

(17) The dealer/banker will pay only on the value of the cards held by the player and shall not pay on the number of cards received or the card sequence.

[Statutory Authority: RCW 9.46.070.      99-13-102 (Order 374), § 230-40-125, filed 6/15/99, effective 8/1/99.      Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-125, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      93-13-062 (Order 240), § 230-40-125, filed 6/17/93, effective 7/18/93.      Statutory Authority: Chapter 9.46 RCW.      91-21-053 (Order 228), § 230-40-125, filed 10/15/91, effective 11/15/91; 91-05-047 (Order 220), § 230-40-125, filed 2/14/91, effective 3/17/91.      Statutory Authority: RCW 9.46.070 (11) and (14).      90-11-058, § 230-40-125, filed 5/15/90, effective 6/15/90.      Statutory Authority: RCW 34.05.220(4), [34.05].230 and 9.46.070 (11) and (14).      90-05-032 (Order 205), § 230-40-125, filed 2/14/90, effective 3/17/90.]

OTS-2906.3

AMENDATORY SECTION(Amending Order 23, filed 9/23/74)

WAC 230-40-130
Wagers to be made with chips only.

All wagers and fees to play made in connection with a card game shall be made with chips furnished by the ((licensed premises. No money, nor other thing of value, shall be used directly in the game itself)) licensee: Provided, That house-banked card games may use coins with a value of fifty cents or twenty-five cents: Provided further, That coins with a value of less than twenty-five cents may be used for pai gow poker games.

[Order 23, § 230-40-130, filed 9/23/74.]

OTS-2907.2

AMENDATORY SECTION(Amending WSR 95-23-109, filed 11/22/95, effective 1/1/96)

WAC 230-40-200
((Participants)) Players to compete on equal terms -- Deal to rotate among players.

((Participants)) Players in card games shall compete on equal terms with all other ((participants)) players in the game, and solely as a ((participant)) player therein.

The deal in any series of nonhouse-banked card games shall be passed from player to player, unless the table incorporates a house dealer as per house rule.      No player who deals a game shall deal another game until each other player at the table has dealt a game in his turn: Provided, That any player may voluntarily waive his right to deal any particular game.

((Licensees shall take all necessary measures to insure that card games played upon their premises are played in this manner.))

[Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-200, filed 11/22/95, effective 1/1/96.      Order 40, § 230-40-200, filed 6/26/75; Order 23, § 230-40-200, filed 9/23/74.]

OTS-2908.4

AMENDATORY SECTION(Amending WSR 95-23-109, filed 11/22/95, effective 1/1/96)

WAC 230-40-225
House dealer allowed in certain games.

((Notwithstanding the provisions of WAC 230-40-200,)) Any licensee may furnish a dealer ((or "mucker")) in any ((Washington blackjack, pan or poker)) game played on the licensed premises.      Dealers shall have no financial interest, directly or indirectly, in the outcome of such game and shall not otherwise participate or play in the game: Provided, That a licensee shall be required to have a house dealer for all house-banked card games, card games operated with a player-supported jackpot, or card games authorized to assess fees for each hand played or fees based on amounts wagered.

[Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-225, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      94-13-098 (Order 252), § 230-40-225, filed 6/15/94, effective 7/16/94; Order 29, § 230-40-225, filed 1/23/75.]

OTS-2909.4

AMENDATORY SECTION(Amending WSR 95-23-109, filed 11/22/95, effective 1/1/96)

WAC 230-40-400
Hours ((limited)) for card games--Procedures for changing hours.

The hours during which card games may be played in licensed public card rooms shall be limited as follows:

(1) Licensees shall not allow the use of their premises for card playing between the hours of 2:00 a.m. and 6:00 a.m.: Provided, That the director may allow closing hours to be adjusted beyond 2:00 a.m. as long as the following conditions ((remain in effect)) are met:

(a) ((The local law enforcement agency with jurisdiction concurs;

(b) Other state agencies involved in regulation of the business do not object; and)) The director shall consult with the local law enforcement agency which has jurisdiction;

(b) The director shall consult with other state agencies involved in regulation of the business;

(c) A licensee must observe a four-hour period of closure at the end of each business day before beginning the next period of operation.

(((2))) (d) The food and/or drink business being stimulated shall be open to the public for business any time card games are conducted((: Provided, That entry to the business by new customers may be limited if access to the premises is open to the commission, law enforcement, or other state or local regulatory agencies, and service of food and nonalcoholic beverages is available for customers remaining on the premises after 2:00 a.m.));

(((3))) (e) At all times during the hours of operation of a Class E, F or house-banked card room, ((the operator or)) a licensed card room employee must be on duty and in the licensed card room area; and

(f) The licensee complies with any other terms and conditions imposed by the director.

(2) The director may deny the request for extended hours or revoke hours already approved if the local law enforcement agency or a state agency objects or if the director determines that the licensee has violated any provisions of chapter 9.46 RCW, any other commission rule, or any of the terms set forth in subsection (1) of this section. All objections to changing a licensee's operating hours or requests to revoke an approved operating schedule must be submitted in writing.

(3) The commission shall afford a licensee an opportunity for a brief adjudicative proceeding prior to denying or revoking the licensee's authorization for extended card room hours. The brief adjudicative proceeding shall be heard by an administrative law judge, under the provisions set forth in WAC 230-50-010(6), and RCW 34.05.482 through 34.05.494.

[Statutory Authority: RCW 9.46.070 (1)-(4), (7), (8), (11), (12), (14), (20) and 9.46.110 (3), (4).      95-23-109, § 230-40-400, filed 11/22/95, effective 1/1/96.      Statutory Authority: RCW 9.46.070.      95-13-024, § 230-40-400, filed 6/13/95, effective 7/14/95.      Statutory Authority: RCW 9.46.070(11).      82-04-010 (Order 118), § 230-40-400, filed 1/22/82; Order 58, § 230-40-400, filed 8/17/76; Order 40, § 230-40-400, filed 6/26/75; Order 23, § 230-40-400, filed 9/23/74.]

OTS-2910.3

AMENDATORY SECTION(Amending WSR 97-14-013, filed 6/20/97, effective 7/21/97)

WAC 230-50-010
Adjudicative proceedings -- Hearings.

(1) ((Adjudicated)) Adjudicative proceedings shall be commenced for any and all matters wherein the commission is causing administrative charges to be brought against any applicant, licensee or permittee within the limitations to chapter 34.05 RCW as applicable.

(2) The commission shall afford an applicant for a license an opportunity for an ((adjudicated)) adjudicative proceeding prior to denying such application, and shall afford a licensee the opportunity for an ((adjudicated)) adjudicative proceeding prior to suspending or revoking a license.

(3) The commission will afford a person applying to the commission for approval of a pull-tab dispensing device under WAC 230-30-095 an opportunity for an ((adjudicated)) adjudicative proceeding prior to denying approval of such device.

(4) No hearing will be conducted with respect to any ((adjudicated)) adjudicative proceeding unless an application for an ((adjudicated)) adjudicative proceeding and request for hearing is timely filed by the applicant or licensee with the commission in compliance with WAC 230-50-210.      The application must be made upon a form to be obtained from the commission, or facsimile thereof, and must be received within 20 days following service upon the party affected by the commission or the director of a notice of administrative charges and opportunity for an ((adjudicated)) adjudicative proceeding.      Said document shall contain the maximum penalty that may be assessed should an application not be filed by the party affected.      An application for an ((adjudicated)) adjudicative proceeding and request for hearing shall accompany all notices of administrative charges.

(5) If an application for an ((adjudicated)) adjudicative proceeding is not timely filed, then the party affected shall have waived the right to a hearing on the allegations set forth in the notice of administrative charges.      The party shall be deemed to be in default pursuant to RCW 34.05.440 and the commission and director may take action against the party not to exceed the maximum penalty as stated in the notice of administrative charges and opportunity for an ((adjudicated)) adjudicative proceeding, which action shall be final.

(6) The procedures of RCW 34.05.485, brief adjudicative proceedings, shall be used for the following purposes:

(a) All hearings in which the penalty sought by the commission is for a suspension of seven days or less;

(b) Hearings held pursuant to WAC 230-50-015 (stay of summary suspension);

(c) Hearings held pursuant to WAC 230-04-400(3) (failure to pay required gambling taxes);

(d) Hearings held pursuant to WAC 230-04-190 (10)(c) (two part payment plan: Failure to make second payment);

(e) Hearings in which the parties have stipulated to facts or the parties have stipulated to charges, and the hearing is limited to a determination of whether facts constitute violations as charged and/or determination of appropriate penalty to be imposed;

(f) Denial of an application to operate at a higher bingo license class when the licensee has been restricted by WAC 230-20-062;

(g) Petitions for a variance to bingo net return requirements authorized by WAC 230-20-060; ((or))

(h) Denial or revocation of extended card room hours pursuant to WAC 230-40-400;

(i) Denial of request for Phase II pursuant to WAC 230-40-810;

(j) Repeal of an approved card game pursuant to WAC 230-40-010; or

(k) Where the parties have stipulated to the use of brief adjudicative proceedings.

[Statutory Authority: RCW 9.46.070 (1), (2).      97-14-013, § 230-50-010, filed 6/20/97, effective 7/21/97.      Statutory Authority: RCW 9.46.070.      95-13-030, § 230-50-010, filed 6/13/95, effective 7/14/95; 92-19-107 (Order 231), § 230-50-010, filed 9/18/92, effective 10/19/92.      Statutory Authority: Chapter 34.05 RCW.      89-24-003 (Order 200), § 230-50-010, filed 11/27/89, effective 12/28/89.      Statutory Authority: RCW 9.46.070(13).      80-03-059 (Order 98), § 230-50-010, filed 2/25/80; Order 45, § 230-50-010, filed 12/30/75; Order 9, § 230-50-010, filed 12/19/73.]

OTS-3726.2

NEW SECTION
WAC 230-40-600
Authorization procedures for player-supported jackpots.

Player-supported jackpots (PSJs) shall be tightly controlled and shall not be operated prior to approval by the director or the director's designee. The following procedures apply to approval of PSJs:

(1) The request shall be in writing and include at least the following:

(a) A detailed description of the game;

(b) All internal control procedures associated with controlling the game and accounting for fees and prizes;

(c) All rules of play; and

(d) The name of the prize fund custodian.

(2) Any changes to the approved game or applicable internal controls must be forwarded to the commission staff for review and approval prior to implementation.

[]

OTS-3727.4

NEW SECTION
WAC 230-40-610
Player-supported jackpots -- Restrictions -- Manner of conducting -- Approval.

A player-supported jackpot (PSJ) is a separate contest of chance directly related to the play and/or outcome of authorized nonhouse-banked card games but which is not the card game itself. Card rooms with a Class F or house-banked license may establish a prize fund for the purpose of operating a PSJ for nonhouse-banked card games. Any PSJ must be approved in writing by the director or the director's designee prior to play. A PSJ must meet the following requirements:

(1) Funding of a PSJ: A licensee may provide house funds to establish a PSJ. The licensee shall issue a check from the general business account into the PSJ account to start the prize fund. Recouping of start-up funds shall be done by issuing a check from the PSJ account to the business general account. Electronic bank transfers shall satisfy this requirement. Start-up funds shall not exceed five thousand dollars per PSJ.

(2) A licensee may assess a portion of player's wagers for a jackpot prize. Such amount shall not exceed one dollar per hand or game for each PSJ. This assessment shall be separately collected using the rake method.

(3) The licensee acts only as the custodian of the PSJ funds and maintains no legal right to the funds. All PSJ funds shall be awarded as prizes. PSJ funds shall only be used for awarding cash prizes based upon a format approved by commission staff. An administrative fee not to exceed ten percent of the amount collected for a PSJ may be imposed by the licensee.

(4) Each licensee shall designate at least one "prize fund custodian" who shall be responsible for safeguarding and disbursing funds to winners. A prize fund custodian may be an owner, partner, officer, or licensed individual designated by a card room owner, partner, or officer. The custodian shall have signature authority for prize fund bank accounts and ensure accountability of all funds collected for use in a PSJ. The licensee shall meet the deposit requirements of WAC 230-12-072.

(5) Prize amounts paid in cash shall not exceed five hundred dollars. Prize amounts not awarded in cash shall be paid by check, the type which provides a duplicate copy, which shall not be cashed on the licensee's premises. A record of all prizes paid shall be maintained in the format prescribed by commission staff and shall include:

(a) For prizes less than one hundred dollars, a system of accounting denoting each individual prize may be utilized.

(b) For prizes one hundred dollars and above, the following information shall be recorded on a prize record:

(i) Full printed name;

(ii) Date of birth;

(iii) Street address;

(iv) Type of identification reviewed;

(v) Amount of the prize awarded;

(vi) Description of the winning hand;

(vii) Time and date awarded; and

(viii) The supervisor's, dealer's and winner's initials.

(c) Upon awarding a prize of five hundred dollars or more, the dealer shall fan the winning hand in view of the surveillance camera. The hand shall be collected and sealed with the prize record. The winning hand and remaining deck shall be maintained on the premises as part of daily card room records for a period of seven days, unless released by a commission agent.

(6) Owners, custodians and on-duty card room employees may participate in card games that offer a PSJ, but may not share in the winnings of any prize awarded. If playing in a game with a PSJ, owners and card room employees must turn their cards face up at the end of each game so that the cards may be observed by other players at the table and surveillance. Any prize winnings an owner or on-duty employee may be entitled to under game rules, must be divided equally among the other players at the table: Provided, That off-duty employees may participate in card games that offer a PSJ and share in the prize winnings.

(7) All card games offering a PSJ must utilize a house dealer.

(8) Security requirements: Each gaming table offering a PSJ shall be required to install a closed circuit television system as outlined in WAC 230-40-825.

(9) In the event that a licensee ceases to operate a card room, fails to maintain a valid card room license, or discontinues a PSJ, the balance (less any nonrecouped seed money) of all PSJ accounts will be forwarded to the Washington State Council on Problem Gambling: Provided, That a licensee may seek approval from the director or the director's designee to revise their prize contests in order to distribute all accumulated prize funds.

(10) House rules to include administrative fees shall be posted in a location readily visible by all players and disclose the conditions under which prizes may be won, the prize amount, cost to participate, and any other conditions which may affect the outcome of the game.

(11) If a dispute arises involving the outcome of a PSJ, the licensee shall preserve the video recording, the winning hand and remaining deck, and all records for the game where the dispute occurred and shall notify commission staff within twenty-four hours. The licensee shall document all information pertaining to the dispute including:

(a) The names, addresses, and phone numbers of all players, card room staff, and any witnesses involved;

(b) Amount of the advertised PSJ; and

(c) A full description of the circumstances surrounding the dispute.

(12) All disputes involving a PSJ will be investigated by commission staff, with a report submitted to the director. A written decision will be issued by the director, or the director's designee, and such decision shall be final.

(13) During the course of dispute resolution, the commission may become the temporary custodian of any and all prize funds. The PSJ will be suspended until the dispute is resolved.

[]

OTS-3728.1

NEW SECTION
WAC 230-40-615
Nonhouse-banked card games -- Administrative and accounting control structure -- Organization.

Licensees conducting activities that require a Class F license shall assure that such activities are closely controlled. Class F licensees shall comply with the following additional requirements:

(1) Establish a system of internal administrative and accounting controls that requires, at a minimum, the following:

(a) Trained personnel;

(b) Segregation of duties for all employees involved in the operation;

(c) Fee collection and funds safeguarding procedures;

(d) Playing card and chip inventory; and

(e) Security and supervision requirements.

(2) The licensee shall have adequate licensed employees to assure commission requirements are met. At a minimum, the following employees are required:

(a) At least one supervisor for every five tables shall be required: Provided, That a single supervisor may supervise up to seven tables, if only seven tables are in operation and the layout was preapproved by commission staff;

(b) A licensee which utilizes two separate areas of a particular gaming establishment shall require at least one supervisor in each area; and

(c) The licensee must have at least two licensed card room employees in the card room at all times player-supported jackpot schemes are in play and/or alternative methods of collection are being utilized. One such employee must be a floor supervisor.

[]

OTS-3729.1

NEW SECTION
WAC 230-40-800
Operating rules for house-banked card games.

Licensees that operate house-banked card games shall establish rules and procedures governing each specific house-banked card game played at their premises. The following restrictions and procedures apply:

(1) House-banked card games shall not be operated prior to approval as set forth in WAC 230-40-010;

(2) All house-banked card games shall be dealt from a dealing shoe or an approved shuffling device;

(3) The licensee shall submit all rules governing the game to commission staff for approval. All requests shall be in writing and include at least the following:

(a) Rules of play, including those specified by the manufacturer or supplier;

(b) Any administrative or accounting controls applicable to specific games;

(c) All specifications provided by the equipment manufacturer or supplier applicable to gaming equipment utilized in the game;

(d) Physical characteristics of the following:

(i) Cards (including procedures for receipt and storage);

(ii) Gaming chips used to play the game;

(iii) All gaming tables and layouts;

(iv) Dealing shoes;

(v) Card shuffling devices;

(vi) Card peeking devices;

(vii) Bill changer devices; and

(viii) Such other equipment as may be required for use in otherwise authorized games;

(4) Rules for each authorized game, shall include at least the following:

(a) Procedures of play;

(b) Minimum and maximum permissible wagers;

(c) Shuffling, cutting, and dealing techniques, as applicable;

(d) Dealer take and pay procedures;

(e) Payout odds on each form of wager, including any factors affecting payments to the player, such as maximum player or aggregate prize restrictions; and

(f) Procedures to be followed on occurrence of irregularities, including examples of irregularities applicable to each game;

(5) A summary of playing procedures and rules of play for each game shall be visibly displayed in the gaming area. If the procedures or restrictions are game specific, they shall be displayed at each gaming table at which the game is played;

(6) Full details on all promotions, schemes or other means used to promote card games operated in card rooms which offer house-banked card games must be submitted to commission staff and be approved prior to implementing.

[]

OTS-3803.4

NEW SECTION
WAC 230-40-803
Phase II wager limits -- Restrictions -- Procedures.

A house-banked card room licensee shall not increase wager limits to Phase II levels prior to demonstrating that it is capable of operating at higher wager limits and receiving commission approval. The following procedures and restrictions apply to the Phase II approval process:

Restrictions.

(1) Prior to requesting approval for Phase II limits a licensee shall:

(a) Operate for a minimum of six months;

(b) Have demonstrated compliance with commission requirements. A licensee shall be deemed to have demonstrated compliance when:

(i) Administrative actions are not pending;

(ii) Administrative actions have not occurred for at least the last six months; and

(iii) It is not currently under investigation by the commission or other law enforcement agency; and

(c) Have paid all gambling taxes due to counties, cities, or towns. For purposes of this section, gambling taxes include those taxes owed as of the most recent reporting period (month or quarter), as provided in the jurisdiction's ordinance, plus any interest and/or penalties that may be due.

Review procedures.

(2) Requests for an increase in wagering limits shall be processed in the following manner:

(a) The licensee shall submit a written request for review, including a deposit of five thousand dollars to pay for the review;

(b) Commission staff shall review the licensee's entire house-banked card game operation. Such review shall include an evaluation of:

(i) The licensee's written internal accounting and administrative controls to ensure they are not materially different from those submitted and approved and that the licensee is following such in every material aspect;

(ii) The licensee is operating house-banked card games in accordance with applicable WAC rules; and

(c) A summary of commission staff's findings and a recommendation shall be presented to the commission at a regular public meeting.

Approval process.

(3) Upon the completion of commission staff's review, the director may authorize a licensee to increase Phase II wagering limits for up to five tables pending commission approval at the next scheduled meeting;

(4) The director may decline to forward a licensee's request for Phase II wagering limits to the commission if:

(a) The licensee has failed to comply with any of the restrictions set forth in subsection (1) of this section; or

(b) The commission staff's review reveals the licensee has failed to follow its approved internal control procedures and such failures are material or, because of repetition, would be material; or

(c) Material violations of WAC rules are noted; and

(d) Actions to correct any deficiencies have not been completed and commission staff afforded adequate time to conduct a follow-up review.

(5) If the director fails to forward a licensee's request within sixty days following completion of commission staff's review and has not commenced administrative actions, a licensee shall be afforded an opportunity to a commission review of the request. The commission may:

(a) Grant the licensee Phase II wager limit approval;

(b) Grant the licensee conditional Phase II approval; or

(c) Refer the request back to commission staff for further investigation.

Sale of a business operating under Phase II.

(6) When a house-banked card room authorized to operate at Phase II levels is sold or otherwise transferred, the director may authorize the new licensee to remain at Phase II levels if the new licensee demonstrates that the gambling operation and internal controls will remain substantially unchanged. Staff may review the operation to determine compliance at the director's request. The licensee shall be responsible for all costs of the review.

[]

OTS-3731.2

NEW SECTION
WAC 230-40-805
House-banked progressive jackpot prizes -- Procedures -- Restrictions.

Licensees are authorized to operate progressive jackpot prizes in conjunction with approved house-banked card games. Entry into a progressive jackpot is based upon a separate wager by a player, part of which accrues to a progressively increasing prize. A player wins the jackpot prize, or portion thereof, based upon achieving a predetermined pattern or combination of cards. Each licensee operating such games shall ensure they are closely controlled, all the funds collected are accounted for, and prizes and methods of winning are adequately disclosed to players. The following procedures and restrictions apply to progressive jackpots:

(1) House-banked progressive jackpot restrictions:

(a) The amount of funds accrued to the primary and reserve or secondary jackpots shall increase by a predetermined amount of each wager made, in accordance with the rules of the game;

(b) The amount of the progressive jackpot eligible to be awarded as a prize shall be prominently displayed at each gaming table;

(c) The beginning amount of each progressive jackpot offered must be recorded, including explanations for any increase or decrease in the amount of the prize offered. This documentation shall be maintained with the progressive jackpot records; and

(d) A licensee may establish a maximum limitation on a progressive jackpot prize. If such a limit is established:

(i) The amount must be equal to or greater than the amount of the jackpot when the limit is imposed; and

(ii) A notice of the limit must be conspicuously posted at or near the game;

(2) A licensee shall not reduce the amount of a progressive jackpot prize, except as authorized by this section, including reserve or secondary jackpots, that have been accrued and displayed to players. The following adjustments are allowed to accrued progressive jackpot prizes:

(a) Prizes may be paid when a player wins the jackpot or a portion thereof. In such instances, the jackpot and advertised amount shall be reduced only by the amount won;

(b) An adjustment may be made to correct malfunctioning equipment or to prevent the display of an amount greater than a predetermined maximum prize limit; or

(c) A reserve or secondary jackpot may be reduced to recover a seed amount as long as it is properly documented in the records;

(3) House-banked progressive jackpot prizes, including any reserve or secondary jackpots, are deemed to be funds for which players have a vested interest and may only be removed from play under the following conditions:

(a) The director provides the licensee written approval of a plan to disburse all jackpot funds back to the players. The request for approval shall include full details of the distribution plan; and

(b) The licensee must notify players of any planned discontinuance, including closure of the business, by conspicuously posting notice for a period of ten days prior to beginning the discontinuance process;

(4) A licensee may temporarily remove a progressive jackpot game from play subject to the following conditions:

(a) The removal and reasons must be approved in writing by commission staff; and

(b) The disruption is caused by circumstances beyond the control of the licensee, or for other good cause (for example: Remodeling the card room); and

(c) Players are notified of the disruption and the estimated date of continuance.

[]

OTS-3732.3

NEW SECTION
WAC 230-40-810
House-banked card games -- Odds based wagers -- Prizes -- Restrictions -- Procedures.

A licensee may establish pay out limits for odds based wagers made at house-banked card games. An "odds based wager" means a wager for which the player is paid an increased amount over and above the amount wagered if a predetermined pattern or combination of cards is achieved. For example, a royal flush, four aces, a pair, etc. Limitations on the payout for odds based wagers are allowed only if the following restrictions and procedures are met:

(1) All payout limits, procedures for computing limits, and methods of disclosing limits to patrons shall be preapproved by the director or the director's designee;

(2) Any limits applied to individual players' winnings shall not be less than the higher of the following calculations:

(a) The maximum wager allowed for the game, times the highest odds offered up to fifty-to-one (50 to 1). For example: The maximum wager is one hundred dollars ($100) and odds are fifty-to-one (50 to 1); then the per player minimum is five thousand dollars ($100 x 50 = $5,000); or

(b) The minimum required wager for the game, as determined by house rule, times the highest odds offered for any wager in the game. For purposes of this section the "minimum required wager" shall be the total amount a player must risk in order to win. For example: The minimum allowed wager is ten dollars ($10) and the maximum odds are one thousand-to-one (1,000 to 1); then the per player minimum is ten thousand dollars ($10 x 1,000 = $10,000);

(3) Any limits applied in aggregate to payments to all players in a game for winning wagers shall not be less than two times the individual player limit, as computed in subsection (2) of this section;

(4) The licensee shall clearly disclose any limits to per player or aggregate payouts on the table layout: Provided, That the director may approve alternative methods of disclosure; and

(5) The licensee shall clearly disclose all procedures for computing any per player or aggregate payouts. This explanation must be available to players in the form of a brochure or other printed media.

[]

OTS-3733.3

NEW SECTION
WAC 230-40-815
House-banked card games -- Administrative and accounting control structure -- Organization.

Each licensee operating a house-banked card game shall ensure that all games are closely controlled, operated fairly and in accordance with all rules of the commission. The following control procedures and conditions shall be met:

(1) The licensee shall have a system of internal controls that include at least the following:

(a) Administrative controls, which include, but are not limited to, the organization's plan, procedures, and records concerned with decision processes leading to management's authorization of transactions; and

(b) Accounting controls which include the licensee's plan, procedures, and records concerned with the safeguarding of assets and the reliability of financial records. These controls must be designed to provide reasonable assurance that:

(i) Transactions are executed in accordance with management's general and specific authorization;

(ii) Transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles, and to maintain accountability for assets;

(iii) Access to assets is permitted only in accordance with management's authorization; and

(iv) The recorded accountability for assets is compared with existing assets at least annually and appropriate action is taken within five working days with respect to any differences.

(2) The licensee's system of administrative controls shall provide for the following:

(a) Competent personnel with an understanding of prescribed procedures;

(b) The segregation of incompatible functions so that no employee is in a position to perpetrate and conceal errors or irregularities in the normal course of his or her duties; and

(c) Each employee of a house-banked card room shall be licensed by the commission and shall be knowledgeable in all accounting and internal control practices and procedures relevant to each employee's individual function.

(3) The licensee shall, at a minimum, establish the following departments or functions that shall be independent from all other departments or functions:

(a) A surveillance department which shall not include security functions or personnel. The head of surveillance shall be responsible for, but not limited to, the following:

(i) The clandestine surveillance of the operation and conduct of the table games;

(ii) The clandestine surveillance of the operation of the cashier's cage;

(iii) The video and audio taping of activities in the count rooms;

(iv) The detection of cheating, theft, embezzlement, and other illegal activities in the gaming facility, count rooms, and cashier's cage;

(v) The video taping of unusual or suspected illegal activities;

(vi) The notification of appropriate supervisors and commission staff, within three working days, upon the detection of cheating, theft, embezzlement, or other illegal activities; and

(vii) Ensuring that each dealer is evaluated to determine if all required dealer procedures and techniques set forth in the licensee's approved internal controls are followed.

(b) A security department, supervised by a security department manager, is responsible for at least the following:

(i) Control of cards and dealing shoes, including storage of new and used cards and shoes, and control of the disposition and/or destruction of same when removed from service; and

(ii) Transfer of cash and chips to and from the gaming tables, cage and count room.

(c) A gaming operation department supervised by a gaming operation department manager who shall be responsible for the operation of all house-banked card games conducted by ensuring the following:

(i) Card games are operated by licensed dealers who are assigned to each gaming table;

(ii) A floor supervisor is assigned the responsibility for the overall supervision of the conduct of gaming within a pit and can supervise no more than five tables: Provided, That a single supervisor may supervise up to seven tables, if only seven tables are in operation and the layout was preapproved by commission staff;

(iii) A licensee which utilizes two separate areas of a gaming establishment shall require at least one supervisor in each area; and

(iv) A shift manager, who reports to the gaming operation department manager, is assigned to supervise floor supervisors and all gaming related activities that occur during each shift. In the absence of the gaming operation department manager, the shift manager shall have the authority of a gaming operation department manager: Provided, That in addition to the floor supervisors required in this subsection, licensees operating more than ten tables shall be required to have a shift manager on the premises.

(d) An accounting department supervised by an individual who shall report directly to the chief executive officer or chief operations officer. The responsibilities of the accounting department shall include, but not be limited to, the following:

(i) Implementing and monitoring of accounting controls;

(ii) The preparation, control, and storage of records and data required;

(iii) The control of unused forms inventory along with reconciliation of forms used; and

(iv) The control and supervision of the cashier's cage.

(4) Any changes to the licensee's system of internal controls must be submitted to commission staff and be approved prior to implementation.

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OTS-3734.4

NEW SECTION
WAC 230-40-820
House-banked card games -- Internal control system evaluation -- Required procedures.

Each licensee operating house-banked card games shall provide an operating environment that will assure that commission rules are adhered to and results of operations can be confirmed by commission staff. In order to assure compliance with this requirement, a complete evaluation of the licensee's system of internal administrative and accounting control procedures shall be completed annually. This evaluation shall be independent of all normal regulatory functions performed by commission staff. A report documenting the results of the evaluation, including any material discrepancies noted and any corrective actions taken, shall be provided to the licensee. The following restrictions and procedures apply to this process:

(1) The evaluation shall be completed by commission staff: Provided, That if commission staff are not available, the licensee, with prior approval, may utilize any of the following:

(a) A certified public accountant (CPA) that is independent in regard to the licensee and which is licensed to perform such engagements by the state of Washington. Prior to entering into a contract for such services, a CPA shall demonstrate adequate knowledge and experience in gambling, and commission rules, procedures and standards. The CPA may be engaged as follows: A copy of an engagement letter from the licensed CPA shall be submitted to the commission at least thirty days prior to offering services. The letter shall include an acknowledgement that the evaluation is being conducted under regulatory requirements of the commission and that a copy of the report will be forwarded to the commission; or

(b) A certified public accountant (CPA) which is licensed to perform such engagements by the state of Washington and is performing a review or audit of the licensee's financial statements. Licensees wishing to use this method of compliance shall receive written approval from the director or the director's designee. In addition, the CPA's engagement letter shall acknowledge:

(i) The evaluation of internal controls is being conducted under regulatory requirements of the commission;

(ii) The service includes a written report on the adequacy of internal administrative and accounting control procedures utilized in the gaming operation and the degree to which the licensee complied with such; and

(iii) The commission is granted access to the accountant's work papers; or

(c) A licensed gambling service supplier that:

(i) Is independent in regard to the licensee being evaluated;

(ii) Demonstrates that all persons involved in performing the evaluation have adequate knowledge and experience in gambling, and commission rules, procedures and standards; and

(iii) Assures all work related to the evaluation of internal controls and the report to the commission is performed by or under the supervision of a licensed CPA meeting the requirements noted in (a) of this subsection;

(2) The evaluation, if conducted by other than commission staff, shall be completed annually, with the cycle beginning one year from the date of initial license approval: Provided, That an evaluation and report may not be required during any period that the licensee has satisfactorily completed a Phase II review, as set forth in WAC 230-40-803, if the review was completed within six months of the scheduled review period: Provided further, That the director may extend the date for evaluation completion if a request is made by the licensee;

(3) If a CPA under contract with a licensee or a licensed service supplier completes the evaluation, the report shall be submitted to the licensee and commission no later than thirty days following completion of the evaluation;

(4) The licensee shall take corrective actions on all deficiencies noted and a report of corrective actions forwarded to the commission no later than thirty days after notification: Provided, That the director may extend the time for correction if the licensee can demonstrate extenuating circumstances and that alternative controls are in place: Provided further, That the director may issue administrative charges on violations that are deemed serious in nature;

(5) The licensee shall be responsible for all costs of internal control evaluations as follows:

(a) The commission shall be reimbursed for evaluations conducted by commission staff. Failure to pay within thirty days of the billing for evaluations conducted by commission staff shall be grounds for suspension of the licensee's card room license until such fees are paid; and

(b) Failure to pay approved CPAs or gambling service suppliers for evaluations prior to them performing any additional reviews, audits, or internal control evaluations for the licensee shall be prima facie evidence of a lack of independence between the parties;

(6) Licensees meeting the following criteria shall have a complete internal control evaluation performed at least once every two years beginning two years from the date of initial license approval:

(a) The licensee waived the opportunity for Phase II status; and

(b) Card room gross receipts do not exceed fifty thousand dollars per month, annualized over a twelve-month period. The evaluation of gross receipts will be based upon no less than six months operating activity.

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OTS-3735.3

NEW SECTION
WAC 230-40-823
House-banked card games -- Financial audits required.

Each licensee operating house-banked card games with gross receipts in excess of five million dollars per year shall have their financial statements examined by a licensed, independent certified public accountant (CPA) for each fiscal year to evaluate the fairness of the presentation of the statements in conformity with generally accepted accounting principles. This examination shall be conducted in accordance with generally accepted auditing standards. A copy of the report and financial statements shall be submitted to the commission no later than one hundred twenty days after conclusion of the fiscal year. The director or the director's designee may extend the date for audit completion if a request is made by the licensee.

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OTS-3736.3

NEW SECTION
WAC 230-40-825
Closed circuit television system requirements and procedures.

All activities related to the operation of card games shall be closely monitored. Critical activities related to house-banked card games, player-supported jackpots and assessment of fees based on amounts wagered (rake method) shall be monitored by use of a closed circuit television system and a video recording. The following restrictions and operating procedures apply when a closed circuit television system is required.

(1) Each licensee shall install and maintain a closed circuit television system that meets at least the specifications set forth below:

(a) Light sensitive cameras including those with pan, tilt, and zoom (PTZ) capabilities where necessary to effectively and clandestinely monitor in detail and from various vantage points, including the following:

(i) The gaming conducted at each gaming table in the facility;

(ii) The activities in the pits;

(iii) Each table game area, with sufficient clarity to identify patrons and dealers;

(iv) Each table game surface, with sufficient coverage and clarity to simultaneously view the table bank and determine the configuration of wagers, card values and game outcome: Provided, That a nonhouse-banked card game not utilizing PSJs will not be required to have coverage of cards;

(v) The operations conducted at and in the cashier's cage: Provided, That for Class F licensees, camera coverage shall not be required of the cashier's cage unless the count is conducted at that location;

(vi) Entrance to the cashier's cage;

(vii) The count processes conducted in the count rooms, which processes shall be in conformity with commission rules;

(viii) The movement of cash, gaming chips, and drop boxes in the establishment;

(ix) The entrances and exits to the card room and the count rooms; and

(x) Such other areas as the commission designates.

(b) All video cameras must be installed in a manner that will prevent them from being readily obstructed, tampered with, or disabled by patrons or employees.

(c) Where a PTZ camera is used to observe card tables and gambling related activities, the camera must be placed behind a smoked dome, one-way mirror or similar materials that conceal the camera from view.

(d) Video recording units, with time and date insertion capabilities, for recording what is being viewed by any camera of the system. Recording and playback of video signals shall be at a rate of not less than twenty frames per second and shall not be recorded in a manner that will not allow playback on a standard consumer grade video cassette recorder. If multiple time and date generators are used, they shall be synchronized to the same time and date. The displayed date and time shall not significantly obstruct the recorded view. The following locations or activities shall be video taped:

(i) All gaming stations in operation or in which drop boxes are stored, to include video recording of all items noted in (a)(i) through (viii) of this subsection;

(ii) All entries to the count room;

(iii) The entire count process, including audio recording (audio recording only required for house-banked card room licensees);

(iv) Any unusual or suspicious activities;

(v) Movement of drop boxes between tables and the count room; and

(vi) Any other activity or location designated by commission staff.

(2) Lighting to provide sufficient clarity shall be present in all areas, including gaming tables and pits, where closed circuit camera coverage is required.

(3) Each video camera required by these rules shall be capable of having its picture displayed on a video monitor and recorded.

(4) The surveillance system must include a sufficient number of monitors to simultaneously display multiple card tables, the cashier's cage, count room activities, and views of any dedicated cameras.

(5) Multiplexing/quad recording devices may only be used for external surveillance, movement of drop boxes between tables and the count room, and on entrances and exits: Provided, That split screen devices may be utilized for areas not required to have surveillance coverage.

(6) The licensee shall maintain one or more surveillance rooms with the following minimum requirements:

(a) The surveillance room shall have controlled access, and be used solely by the employees of the surveillance department assigned to monitor activities: Provided, That this restriction does not apply to owners or approved supervisory or management personnel. Commission agents and law enforcement personnel shall be provided immediate access to the surveillance room upon request.

(b) A house-banked card game licensee shall ensure that a surveillance employee is present in the surveillance room and monitoring the activities of the operation, via the surveillance room equipment, at all times the card room is open to conduct gaming and during the count process as stated in WAC 230-40-885(4): Provided, That the licensee may allow the surveillance room to operate without staff for a period not to exceed thirty minutes per shift for the purpose of routine breaks. All surveillance employees shall have a demonstrated knowledge of the following:

(i) Operating surveillance systems;

(ii) Rules of play and procedures for the games being played; and

(iii) The overall procedures relating to the duties of all employees of a house-banked card room being monitored (dealers, shift managers, floor supervisors, cage personnel, and count team).

(c) Licensees that are licensed for five or fewer tables and not operating under Phase II limits, shall not be required to maintain a staffed surveillance room.

(d) The licensee shall maintain a record of all surveillance activities in the surveillance room. The surveillance log shall be maintained by surveillance personnel and shall include, at a minimum, the following:

(i) Date and time of surveillance;

(ii) Person initiating surveillance;

(iii) Reason for surveillance;

(iv) Time of termination of surveillance;

(v) Summary of the results of the surveillance; and

(vi) A record of any equipment or camera malfunctions.

(e) A surveillance room sign-in log shall be maintained to document the time each surveillance employee monitors the card room. A surveillance room sign-in log shall be available for inspection at any time by commission staff or local law enforcement.

(7) Video and audio tapes shall be identified to denote the activity recorded and retained for a period necessary to afford commission staff or law enforcement personnel reasonable access. The following minimum retention periods apply to tapes:

(a) All tapes shall be retained for a minimum of seven days: Provided, That the seven-day retention period may be measured on a weekly and per shift basis as long as tapes are uniformly labeled by day of the week and shift;

(b) Tapes of evidentiary value shall be maintained as requested by commission staff;

(c) Tapes documenting jackpot payouts over three thousand dollars shall be retained for at least thirty days; and

(d) Commission staff may increase any of the times noted in this section by notifying the licensee.

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OTS-3737.2

NEW SECTION
WAC 230-40-830
Cashier's cage -- Requirements.

All cash, cash equivalents, and chips related to the operation of card games shall be closely controlled and records maintained documenting receipts and disbursements. Licensees shall maintain a cashier's function whose responsibility shall be to secure and account for all chips and monies in the card room portion of the premises. At a minimum, the following restrictions and procedures apply:

(1) There shall be on or immediately adjacent to the gaming floor a physical structure known as the cashier's cage (cage) to house the cashiers and to serve as the central location for, at a minimum, the following:

(a) The custody of the cage inventory comprising currency, coin, patron checks, gaming chips, forms, documents and records normally associated with the operation of a cage;

(b) The approval of patron checks for the purpose of gaming;

(c) The receipt and distribution of gaming chips from the gaming table and the redemption of gaming chips from patrons. The purchase of gaming chips by patrons shall only occur at the gaming table; and

(d) Such other functions normally associated with the operation of a cage.

(2) The cage shall be designed, constructed and operated to provide maximum security and accountability for funds including, at a minimum, the following:

(a) An enclosed structure except for openings through which items such as gaming chips, checks, cash, records, and documents can be passed to service the public and gaming tables;

(b) Manually triggered silent alarm systems connected directly to the surveillance rooms of the closed circuit television system or an alarm monitoring agency;

(c) Access shall be through a locked door, which shall have closed circuit television coverage which is monitored by the surveillance department.

(3) Entry to the cage shall be limited to authorized personnel. The gaming operation department shall place on file with the accounting department the names of all persons authorized to enter the cage, those who possess the combination or the keys or who control the mechanism to open the locks securing the entrance to the cage, and those who possess the ability to operate the alarm systems.

(4) A log shall be maintained documenting all persons entering the cashier's cage. The log must contain the person's name, title, time entering and exiting, and date of entry.

(5) Licensees not offering house-banked card games shall not be required to meet the above requirements: Provided, That licensees shall maintain a system for securing and properly accounting for all gaming chips and monies.

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OTS-3738.1

NEW SECTION
WAC 230-40-833
Cashier's bank and minimum bankroll.

All card room licensees with house-banked card games or player-supported jackpots shall maintain sufficient funds to meet all cash out and prize payout requirements.

(1) All assets for which the cashiers are responsible shall be maintained on an imprest basis. This requires funds to be replenished on a regular basis by exactly the amount of expenditures from the cage less the amount of funds added. Expenditures shall be reviewed by a supervisor of the accounting department before replenishment: Provided, That licensees demonstrating the ability to control cage activity can request commission staff approval to operate on a float basis as an alternative procedure.

(2) The licensee shall have sufficient cash on hand to redeem all chips and payout all prizes: Provided, That payments of prizes may be paid by check as long as sufficient funds are available on deposit in accordance with WAC 230-12-072 and 230-12-073.

(3) Failure to maintain funds to cash in chips, pay prizes, or redeem gaming related checks shall be prima facie evidence of fraud.

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OTS-3739.1

NEW SECTION
WAC 230-40-835
Accounting controls for cashier's cage.

Licensees required to maintain a cashier's cage shall adhere to the following controls to ensure proper accountability for funds. The following restrictions and procedures apply to cashiers and the cage:

(1) Cashiers shall be responsible for at least the following functions:

(a) Receive cash, checks, and gaming chips from patrons for check consolidations, total or partial redemptions or substitutions;

(b) Receive gaming chips from patrons in exchange for cash;

(c) Receive traveler's checks and other cash equivalents (including money orders, certified checks, and cashier's checks) from patrons in exchange for currency or coin;

(d) Receive documentation with signatures thereon, required to be prepared for the effective segregation of functions in the cashier's cage;

(e) Receive from security department personnel, chips and coins removed from gaming tables in exchange for the issuance of a credit;

(f) Receive from security department members, requests for fills in exchange for the issuance of a fill slip and the disbursal of gaming chips;

(g) Receive cash or chips from the count room;

(h) At the end of each shift, the cashiers assigned to the outgoing shift shall count each cage inventory item and record on a cashier's count sheet the face value of each inventory item and the total of the opening and closing inventories. The total closing inventory shall be reconciled with the total opening inventory;

(i) Prepare the overall cage reconciliation and accounting records; and

(j) Perform such other functions as necessary to ensure proper accountability of funds and chips consistent with these standards.

(2) Signatures attesting to accuracy shall, at a minimum, be contained on the following:

(a) Cashier's count sheet; and

(b) Cage inventory countsheet, which includes the signatures of the cashiers assigned to the incoming and outgoing shifts.

(3) At the conclusion of the daily gaming activity, copies of the cashier's count sheet, cage inventory count sheet and related documentation shall be forwarded to the accounting department for agreement of opening and closing inventories, and agreement of amounts thereon to other forms, records and documentation for recording of transactions.

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OTS-3740.3

NEW SECTION
WAC 230-40-840
Drop boxes -- Requirements.

Licensees required to utilize drop boxes shall ensure they are constructed and controlled in a manner to provide security of contents. All card rooms operating house-banked card games or collecting fees utilizing the drop box as a collection method shall meet the following requirements and procedures:

(1) Each gaming table shall have attached to it a metal container known as a "drop box" into which all cash, duplicate fill slips and credit slips, request for fills, request for credits, and table inventory forms shall be deposited.

(2) Each drop box shall have the following:

(a) A lock securing the contents. The key to this lock shall be maintained and controlled by the accounting department;

(b) A separate lock securing the drop box to the gaming table. This lock shall be keyed differently from the lock securing the contents of the drop box. The key utilized to unlock this lock shall be maintained and controlled by the security department;

(c) An opening through which currency, coins, chips, forms, records and documents can be inserted into the drop box;

(d) Permanently imprinted or impressed thereon and clearly visible, a number corresponding to a permanent number on the gaming table to which it is attached and a marking to indicate the game. The shift shall also be included if drop boxes are removed from tables more than once during an operating day: Provided, That emergency drop boxes may be maintained without such number or marking, if the word "emergency" is permanently imprinted or impressed thereon, and when put into use, are temporarily marked with the number of the gaming table and identification of the game and shift.

(3) All drop boxes removed from the gaming tables shall be transported directly to the count room and secured by one security department member and one employee of the gaming operation department: Provided, That licensees not required to maintain a count room shall transport drop boxes directly to the count area using the supervisor or the supervisor's designee for the transport: Provided further, That a licensee may utilize the count team members to pull and transport the drop boxes to the count table for the count process, if conducted under the supervision of security when the gaming operation is closed.

(4) All drop boxes not attached to a gaming table shall be stored in the count room in an enclosed storage cabinet or trolley and secured in such cabinet or trolley by two separately keyed locks. The key to one lock shall be maintained and controlled by the security department and the key to the other lock shall be maintained and controlled by the gaming operation department.

(5) Drop boxes, when not in use during a shift, may be stored on the gaming tables if licensed security personnel are present in the gaming area at all times drop boxes are stored on the gaming tables and the entire area is covered by taped surveillance. If adequate security is not provided during this time, the drop boxes shall be stored as required in subsection (4) of this section.

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OTS-3741.3

NEW SECTION
WAC 230-40-845
Procedures for exchange of checks submitted by gaming patrons at cashier's cage.

In addition to the requirements set forth in WAC 230-12-053, checks submitted to the cashier's cage are subject to the following restrictions and procedures:

(1) All checks sought to be exchanged at the cashiers' cage shall be presented directly to the cashier who shall:

(a) Restrictively endorse the check "for deposit only" to the licensee's bank account;

(b) Initial the check;

(c) Date and time stamp the check;

(d) Verify that the patron is not listed on the returned check log;

(e) Immediately exchange the check for currency and coin in an amount equal to the amount for which the check is drawn less any applicable fees; and

(f) Forward all patron checks to the main bank cashier.

(2) Prior to acceptance of a traveler's check from a patron, the cashier shall:

(a) Require the patron to countersign the traveler's check in his or her presence;

(b) Compare the countersignature with the original signature on the traveler's check;

(c) Examine the traveler's check for any other signs of tampering, forgery or alteration; and

(d) Perform any other procedures that the issuer of the traveler's check requires in order to indemnify the acceptor against loss.

(3) Prior to the acceptance of any check from a patron, the cashier shall examine that patron's identification to confirm the patron's identity.

(4) All checks received shall be deposited in the licensee's bank account within two banking days after receipt: Provided, That checks deposited within two days to an armored car service shall meet this requirement.

(5) All checks dishonored by a bank (returned checks) shall be returned directly to, and controlled by, accounting department employees: Provided, That if a collection agency is used which maintains dishonored checks, a photocopy of the check shall be sufficient.

(6) Records of all returned checks shall be maintained by accounting department employees and shall be available to cashiers. Such records shall include, at a minimum, the following:

(a) The date of the check;

(b) The name of the drawer of the check;

(c) The amount of the check;

(d) The date(s) the check was dishonored; and

(e) The date(s) and amount(s) of any collections received on the check after being returned by a bank.

(7) If a check is dishonored, the name of the person who submitted the check shall be kept in a log and available to the cashier. Such person shall be prohibited from submitting additional checks until the amount owed is paid in full: Provided, That a check dishonored by a bank may be immediately redeposited if there is sufficient reason to believe the check will be honored the second time.

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OTS-3742.1

NEW SECTION
WAC 230-40-850
Procedures for purchasing gaming chips.

The purchase of gaming chips by patrons shall be conducted in a manner to ensure proper accountability of chips and cash. The following restrictions and procedures apply:

(1) Gaming chips shall only be purchased at the gaming table;

(2) The cash shall be spread on the top of the gaming table by the dealer in a manner that allows the patron, floor supervisor, and surveillance a full view of the transaction;

(3) The amount of cash shall be announced by the dealer accepting it in a tone of voice to be heard by the patron who presented the cash and the floor supervisor specifically assigned to the gaming table. All cash changes of one hundred dollars or more shall be verified by the supervisor;

(4) Prior to giving gaming chips to the patron, the dealer shall prove each denomination of chips in a manner that discloses the number of chips to the patron, floor supervisor, and surveillance. Procedures for proving chips shall be included in the licensee's approved system of internal controls; and

(5) Immediately after gaming chips, equivalent to the cash amount paid by the patron, have been given to the patron, the cash shall be taken from the top of the gaming table and placed by the dealer into the drop box attached to the gaming table.

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OTS-3743.3

NEW SECTION
WAC 230-40-855
Acceptance of tips from patrons for house-banked activities.

Licensees may allow selected employees to accept tips from patrons. If allowed, tips shall be controlled in a manner to ensure they are only received by authorized persons, properly accounted for, and maintained separate from all other gaming funds. The following restrictions and procedures apply:

(1) No employee directly concerned with management, supervision, accounting, security, or surveillance shall solicit, accept or otherwise share any tip originating from any player or patron: Provided, That cage cashiers shall be allowed to accept tips.

(2) Each licensee shall establish procedures necessary to ensure that the acceptance of tips by dealers is observed by the floor supervisor and surveillance. Procedures shall include an overt display of tips received, such as tapping the table with the tip prior to placing it in the tip container.

(3) Tips to the cashier shall be deposited directly into the tip container by the patron. Cashier tip containers shall be located outside the cage enclosure.

(4) Tips received shall be retained by employees or pooled among employees in such manner as determined by the licensee.

(5) Licensees shall establish and implement procedures for the proper accounting of tips received by authorized card room employees. The procedures shall be fully documented in the licensee's internal controls and shall describe in detail any methods used to allocate tips. Accounting and recording of tip income shall be in sufficient detail to meet federal income tax requirements.

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OTS-3744.1

NEW SECTION
WAC 230-40-860
Table inventories and procedures for opening tables for house-banked card games.

Procedures shall be established to ensure proper accountability of gaming chips and coins stored at gaming tables and for beginning play at such tables. The following restrictions and procedures apply:

(1) Whenever a gaming table is opened for gaming, operations shall commence with an amount of gaming chips and coins to be known as the "table inventory" and the licensee shall not cause or permit gaming chips or coins to be added to or removed from such table inventory during the gaming day except:

(a) In exchange for cash from patrons;

(b) In payment of winning wagers and collection of losing wagers made at such gaming table;

(c) In exchange for gaming chips received from a patron having an equal aggregate face value; and

(d) In conformity with procedures set forth in WAC 230-40-865 and 230-40-870.

(2) Each table inventory and the table inventory slip prepared in conformity with the procedures set forth in WAC 230-40-875 shall be stored during nongaming hours in a separate locked, clear container which shall be clearly marked on the outside with the game and the gaming table number to which it corresponds. The information on the table inventory slip shall be visible from the outside of the container. All containers shall be stored in the cashier's cage during nongaming hours: Provided, That containers may be secured at the gaming table if under taped surveillance.

(3) The keys to table inventory containers shall be maintained and controlled by the gaming operation department in a secure place and shall at no time be made accessible to any cashier's cage personnel or to any person responsible for transporting such table inventories to or from the gaming tables.

(4) Licensees shall abide by the following procedures when opening gaming tables for play:

(a) The locked container securing the table inventory and the table inventory slip shall be unlocked by the gaming operation supervisor assigned to such table;

(b) A dealer assigned to the gaming table shall prove the contents of the container in the presence of the gaming operation supervisor assigned to such table and shall compare the count to the "opener," as defined in WAC 230-40-875, removed from the container. The procedures used to prove the chip and coin inventory shall be set forth in the licensee's internal controls;

(c) Signatures attesting to the accuracy of the information on the opener shall be placed on such "opener" by the dealer assigned to the table and the gaming operation supervisor that observed the dealer count the contents of the container;

(d) Any discrepancy between the amount of gaming chips and coins counted and the amount of the gaming chips and coins recorded on the "opener," shall be immediately reported to the gaming operation manager, assistant gaming operation manager, or gaming operation shift manager in charge at such time. The manager in charge shall complete the notification of error slip, which will be verified by security and transported to accounting or the cashier's cage. Accounting will maintain a copy in the log containing the notification of error slips. The licensee shall notify commission staff within twenty-four hours of errors of two hundred dollars or more or if there is a pattern relating to regular shortages;

(e) After the count of the contents of the container and the signing of the "opener," such slip shall be immediately deposited in the drop box attached to the gaming table by the dealer.

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OTS-3745.4

NEW SECTION
WAC 230-40-865
Procedure for distributing gaming chips and coins to house-banked gaming tables -- Requests and fills.

Gaming chips and coins shall only be distributed to gaming tables with adequate security and in a manner that ensures proper control and accountability. The following restrictions and procedures apply:

(1) Each "fill slip" shall be serially prenumbered three-part forms, which provide an original and duplicate copies as necessary: Provided, That the director may authorize use of a computer based accounting system which includes a nonrepeating sequential numbering system that is consistent with the controls and safeguards of the manual system. Requests for fills shall be a two-part form which provides an original and duplicate copy. These forms shall be controlled in the following manner:

(a) Each series of fill slips received by a licensee shall be controlled and accounted for separately;

(b) Request for fills shall be secured in such a manner that only a gaming operations supervisor has access;

(c) Fill slips shall be secured by the cashier's cage;

(d) These forms shall be used in sequential order and all forms accounted for; and

(e) The preparer shall void forms that have errors by marking "VOID" on both the original and duplicate copies and sign the form.

(2) A "request for fill" shall be prepared by the gaming operation supervisor to authorize the cage to prepare a "fill slip" for the distribution of chips and coins to gaming tables. The original and duplicate of the request for fill shall include the following entries:

(a) The date, time, and shift of preparation;

(b) The denomination of gaming chips or coins to be distributed to the gaming tables;

(c) The total amount of each denomination of gaming chips or coins to be distributed to the gaming tables;

(d) The game and table number to which the gaming chips or coins are to be distributed;

(e) The signature of the gaming operation supervisor; and

(f) The signature of the security department employee that distributed the chips and coins.

(3) After preparation of the request for fill, the original of such request shall be transported directly to the cashier's cage by security.

(4) The duplicate copy of the request for fill shall be placed by the dealer or floor supervisor in public view on the gaming table to which the gaming chips or coins are to be received. Such duplicate copy shall not be removed until the chips and coins are received, at which time the request for fill and fill slip are deposited in the drop box.

(5) A fill slip shall be prepared by a cashier whenever gaming chips or coins are distributed to the gaming tables from the cashier's cage. The following procedures and requirements shall be observed with regard to fill slips:

(a) Each series of fill slips shall be in triplicate form to be kept in a locked dispenser that will permit an individual fill slip in the series and its copies to be written upon simultaneously while still located in the dispenser, and that will discharge the original and duplicate while the triplicate remains in a continuous, unbroken form in the dispenser: Provided, That if a computer system is used, which includes a nonrepeating sequential numbering system, the controls and safeguards of the manual system must be present; and

(b) Access to the triplicate copy of the form shall be maintained and controlled at all times by an accounting department employee responsible for controlling and accounting for the unused supply of fill slips, placing fill slips in the dispensers, and removing from the dispensers, each day, the triplicate copies remaining therein.

(6) On the original, duplicate, and triplicate copies of the fill slip, the preparer shall record, at a minimum, the following information:

(a) The denomination of the gaming chips or coins being distributed;

(b) The total amount of each denomination of gaming chips or coins being distributed;

(c) The total amount of all denominations of gaming chips or coins being distributed;

(d) The game and table number to which the gaming chips or coins are being distributed;

(e) The date and shift during which the distribution of gaming chips or coins occurs; and

(f) The signature of the preparer.

(7) Upon preparation, the time of preparation of the fill slip shall be recorded, at a minimum, on the original and the duplicate.

(8) All gaming chips or coins distributed to the gaming tables from the cashier's cage shall be transported directly by a security department employee. This employee shall verify the request for fill to the amount of the fill slip and sign the original of the request for fill, which is maintained at the cashier's cage, before transporting the gaming chips or coins and the original and duplicate of the fill slip for signature.

(9) Signatures attesting to the accuracy of the information contained on the original and duplicate of the fill slips shall, at a minimum, be those of the following personnel at the following times:

(a) The cashier upon preparation;

(b) The security department employee transporting the gaming chips or coins to the gaming table upon receipt from the cashier of gaming chips or coins;

(c) The dealer assigned to the gaming table upon receipt; and

(d) The gaming operation supervisor assigned to the gaming table upon receipt of the gaming chips or coins at such table.

(10) Upon meeting the signature requirements, the security department employee that transported the gaming chips or coins and the original and duplicate copies of the fill slip to the table, shall observe the following:

(a) The dealer shall immediately place the duplicate fill slip and duplicate request for fill in the drop box attached to the gaming table to which the gaming chips or coins were transported; and

(b) The security department employee shall then return the original fill slip to the cashier's cage where the original fill slip and request for fill shall be maintained together and controlled by cage employees.

(11) The original and duplicate "VOID" fill slips, the original request for fill, and the original fill slip shall be forwarded as follows:

(a) The count team, as described in WAC 230-40-885(2), for agreement with the duplicate copy of the fill slip and duplicate copy of the request for fill removed from the drop box after which the original and duplicate copy of the request for fill and the original and duplicate copy of the fill slip shall be forwarded to the accounting department for agreement, on a daily basis, with the triplicate; or

(b) The accounting department for agreement, on a daily basis, with the duplicate fill slip and duplicate copy of the req