Bill Text: IL HB0618 | 2009-2010 | 96th General Assembly | Engrossed

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Bill Title: Amends the Illinois Lottery Law. Creates the Lottery Supports Schools Fund. Provides that certain lottery revenues shall be deposited into the Fund. Provides that moneys in the fund shall be distributed to school districts based on the district's percentage of lottery sales. Effective immediately.

Spectrum: Partisan Bill (Democrat 5-0)

Status: (Introduced - Dead) 2009-04-02 - Third Reading - Extended Debate - Lost 037-077-001 [HB0618 Detail]

Download: Illinois-2009-HB0618-Engrossed.html

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AN ACT concerning State government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Lottery Law is amended by changing
Sections 2, 7.2, 9, 19, 20, and 20.1 and by adding Section 20.2
as follows:
(20 ILCS 1605/2) (from Ch. 120, par. 1152)
Sec. 2. This Act is enacted to implement and establish
within the State a lottery to be operated by the State, the
entire net proceeds of which are to be used for the support of
the State's Lottery Supports Schools Fund Common School Fund,
except as provided in Sections 21.2, 21.5, 21.6, 21.7, and
21.8.
(Source: P.A. 94-120, eff. 7-6-05; 94-585, eff. 8-15-05;
95-331, eff. 8-21-07; 95-673, eff. 10-11-07; 95-674, eff.
10-11-07; 95-876, eff. 8-21-08.)
(20 ILCS 1605/7.2) (from Ch. 120, par. 1157.2)
Sec. 7.2. The rules and regulations of the Department may
include, but shall not be limited to, the following:
(1) The types of lotteries to be conducted;
(2) The price, or prices, of tickets or shares in the
lottery;

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(3) The numbers and sizes of the prizes on the winning
tickets or shares;
(4) The manner of selecting the winning tickets or shares;
(5) The manner of payment of prizes to the holders of
winning tickets or shares;
(6) The frequency of the drawing or selections of winning
tickets or shares, without limitation;
(7) Without limit to number, the type or types of locations
at which tickets or shares may be sold;
(8) The method to be used in selling tickets or shares;
(9) The manner and amount of compensation, if any, to be
paid licensed sales agents necessary to provide for the
adequate availability of tickets or shares to prospective
buyers and for the convenience of the public;
(10) The apportionment of the total revenues accruing from
the sale of lottery tickets or shares and from all other
sources among (i) the payment of prizes to the holders of
winning tickets or shares, (ii) the payment of costs incurred
in the operation and administration of the lottery, including
the expenses of the Department and the costs resulting from any
contract or contracts entered into for promotional,
advertising or operational services or for the purchase or
lease of lottery equipment and materials, and (iii) for monthly
transfers to the Lottery Supports Schools Fund Common School
Fund. The net revenues accruing from the sale of lottery
tickets shall be determined by deducting from total revenues

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the payments required by paragraphs (i) and (ii) of this
subsection.
(11) Such other matters necessary or desirable for the
efficient and economical operation and administration of the
lottery and for the convenience of the purchasers of tickets or
shares and the holders of winning tickets or shares.
Any rules and regulations of the Department with respect to
monthly transfers to the Lottery Supports Schools Fund Common
School Fund are subject to Section 21.2.
(Source: P.A. 84-1128.)
(20 ILCS 1605/9) (from Ch. 120, par. 1159)
Sec. 9. The Superintendent, as administrative head of the
Division, shall direct and supervise all its administrative and
technical activities and shall report to the Director. In
addition to the duties imposed upon him elsewhere in this Act,
it shall be the Superintendent's duty:
a. To supervise and administer the operation of the lottery
in accordance with the provisions of this Act or such rules and
regulations of the Department adopted thereunder.
b. To attend meetings of the Board or to appoint a designee
to attend in his stead.
c. To employ and direct such personnel in accord with the
Personnel Code, as may be necessary to carry out the purposes
of this Act. The Superintendent may, subject to the approval of
the Director, use the services, personnel, or facilities of the

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Department. In addition, the Superintendent may by agreement
secure such services as he or she may deem necessary from any
other department, agency, or unit of the State government, and
may employ and compensate such consultants and technical
assistants as may be required and is otherwise permitted by
law.
d. To license, in accordance with the provisions of
Sections 10 and 10.1 of this Act and the rules and regulations
of the Department adopted thereunder, as agents to sell lottery
tickets such persons as in his opinion will best serve the
public convenience and promote the sale of tickets or shares.
The Superintendent may require a bond from every licensed
agent, in such amount as provided in the rules and regulations
of the Department. Every licensed agent shall prominently
display his license, or a copy thereof, as provided in the
rules and regulations of the Department.
e. To suspend or revoke any license issued pursuant to this
Act or the rules and regulations promulgated by the Department
thereunder.
f. To confer regularly as necessary or desirable and not
less than once every month with the Lottery Control Board on
the operation and administration of the Lottery; to make
available for inspection by the Board or any member of the
Board, upon request, all books, records, files, and other
information and documents of his office; to advise the Board
and recommend such rules and regulations and such other matters

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as he deems necessary and advisable to improve the operation
and administration of the lottery.
g. To enter into contracts for the operation of the
lottery, or any part thereof, and into contracts for the
promotion of the lottery on behalf of the Department with any
person, firm or corporation, to perform any of the functions
provided for in this Act or the rules and regulations
promulgated thereunder. The Department shall not expend State
funds on a contractual basis for such functions unless those
functions and expenditures are expressly authorized by the
General Assembly.
h. To enter into an agreement or agreements with the
management of state lotteries operated pursuant to the laws of
other states for the purpose of creating and operating a
multi-state lottery game wherein a separate and distinct prize
pool would be combined to award larger prizes to the public
than could be offered by the several state lotteries,
individually. No tickets or shares offered in connection with a
multi-state lottery game shall be sold within the State of
Illinois, except those offered by and through the Department.
No such agreement shall purport to pledge the full faith and
credit of the State of Illinois, nor shall the Department
expend State funds on a contractual basis in connection with
any such game unless such expenditures are expressly authorized
by the General Assembly, provided, however, that in the event
of error or omission by the Illinois State Lottery in the

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conduct of the game, as determined by the multi-state game
directors, the Department shall be authorized to pay a prize
winner or winners the lesser of a disputed prize or $1,000,000,
any such payment to be made solely from funds appropriated for
game prize purposes. The Department shall be authorized to
share in the ordinary operating expenses of any such
multi-state lottery game, from funds appropriated by the
General Assembly, and in the event the multi-state game control
offices are physically located within the State of Illinois,
the Department is authorized to advance start-up operating
costs not to exceed $150,000, subject to proportionate
reimbursement of such costs by the other participating state
lotteries. The Department shall be authorized to share
proportionately in the costs of establishing a liability
reserve fund from funds appropriated by the General Assembly.
The Department is authorized to transfer prize award funds
attributable to Illinois sales of multi-state lottery game
tickets to the multi-state control office, or its designated
depository, for deposit to such game pool account or accounts
as may be established by the multi-state game directors, the
records of which account or accounts shall be available at all
times for inspection in an audit by the Auditor General of
Illinois and any other auditors pursuant to the laws of the
State of Illinois. No multi-state game prize awarded to a
nonresident of Illinois, with respect to a ticket or share
purchased in a state other than the State of Illinois, shall be

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deemed to be a prize awarded under this Act for the purpose of
taxation under the Illinois Income Tax Act. All of the net
revenues accruing from the sale of multi-state lottery tickets
or shares shall be transferred into the Lottery Supports
Schools Fund Common School Fund pursuant to Section 7.2. The
Department shall promulgate such rules as may be appropriate to
implement the provisions of this Section.
i. To make a continuous study and investigation of (1) the
operation and the administration of similar laws which may be
in effect in other states or countries, (2) any literature on
the subject which from time to time may be published or
available, (3) any Federal laws which may affect the operation
of the lottery, and (4) the reaction of Illinois citizens to
existing and potential features of the lottery with a view to
recommending or effecting changes that will tend to serve the
purposes of this Act.
j. To report monthly to the State Treasurer and the Lottery
Control Board a full and complete statement of lottery
revenues, prize disbursements and other expenses for each month
and the amounts to be transferred to the Common School Fund
pursuant to Section 7.2 or such other funds as are otherwise
authorized by Section 21.2 of this Act, and to make an annual
report, which shall include a full and complete statement of
lottery revenues, prize disbursements and other expenses, to
the Governor and the Board. All reports required by this
subsection shall be public and copies of all such reports shall

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be sent to the Speaker of the House, the President of the
Senate, and the minority leaders of both houses.
(Source: P.A. 94-776, eff. 5-19-06.)
(20 ILCS 1605/19) (from Ch. 120, par. 1169)
Sec. 19. Period for claiming prizes; unclaimed prizes. The
Division shall establish an appropriate period for the claiming
of prizes for each lottery game offered. Each claim period
shall be stated in game rules and written play instructions
issued by the Superintendent in accordance with Section 7.1 of
this Act. Written play instructions shall be made available to
all players through sales agents licensed to sell game tickets
or shares. Prizes for lottery games which involve the purchase
of a physical lottery ticket may be claimed only by
presentation of a valid winning lottery ticket that matches
validation records on file with the Lottery; no claim may be
honored which is based on the assertion that the ticket was
lost or stolen. No lottery ticket which has been altered,
mutilated, or fails to pass validation tests shall be deemed to
be a winning ticket.
If no claim is made for the money within the established
claim period, the prize may be included in the prize pool of
such special drawing or drawings as the Division may, from time
to time, designate. Unclaimed multi-state game prize money may
be included in the multi-state prize pool for such special
drawing or drawings as the multi-state game directors may, from

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time to time, designate. Any bonuses offered by the Department
to sales agents who sell winning tickets or shares shall be
payable to such agents regardless of whether or not the prize
money on the ticket or share is claimed, provided that the
agent can be identified as the vendor of the winning ticket or
share, and that the winning ticket or share was sold on or
after January 1, 1984. All unclaimed prize money not included
in the prize pool of a special drawing shall be transferred to
the Lottery Supports Schools Fund Common School Fund.
(Source: P.A. 94-776, eff. 5-19-06.)
(20 ILCS 1605/20) (from Ch. 120, par. 1170)
Sec. 20. State Lottery Fund.
(a) There is created in the State Treasury a special fund
to be known as the "State Lottery Fund". Such fund shall
consist of all revenues received from (1) the sale of lottery
tickets or shares, (net of commissions, fees representing those
expenses that are directly proportionate to the sale of tickets
or shares at the agent location, and prizes of less than $600
which have been validly paid at the agent level), (2)
application fees, and (3) all other sources including moneys
credited or transferred thereto from any other fund or source
pursuant to law. Interest earnings of the State Lottery Fund
shall be credited to the Lottery Supports Schools Fund Common
School Fund.
(b) The receipt and distribution of moneys under Section

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21.5 of this Act shall be in accordance with Section 21.5.
(c) The receipt and distribution of moneys under Section
21.6 of this Act shall be in accordance with Section 21.6.
(d) The receipt and distribution of moneys under Section
21.7 of this Act shall be in accordance with Section 21.7.
(e) The receipt and distribution of moneys under Section
21.8 of this Act shall be in accordance with Section 21.8.
(Source: P.A. 94-120, eff. 7-6-05; 94-585, eff. 8-15-05;
95-331, eff. 8-21-07; 95-673, eff. 10-11-07; 95-674, eff.
10-11-07; 95-876, eff. 8-21-08.)
(20 ILCS 1605/20.1) (from Ch. 120, par. 1170.1)
Sec. 20.1. Department account.
(a) The Department is authorized to pay validated prizes up
to $25,000 from funds held by the Department in an account
separate and apart from all public moneys of the State. Moneys
in this account shall be administered by the Director
exclusively for the purposes of issuing payments to prize
winners authorized by this Section. Moneys in this account
shall be deposited by the Department into the Public
Treasurers' Investment Pool established under Section 17 of the
State Treasurer Act. The Department shall submit vouchers from
time to time as needed for reimbursement of this account from
moneys appropriated for prizes from the State Lottery Fund.
Investment income earned from this account shall be deposited
monthly by the Department into the Lottery Supports Schools

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Fund Common School Fund. The Department shall file quarterly
fiscal reports specifying the activity of this account as
required under Section 16 of the State Comptroller Act, and
shall file quarterly with the General Assembly, the Auditor
General, the Comptroller, and the State Treasurer a report
indicating the costs associated with this activity.
(b) The Department is authorized to enter into an
interagency agreement with the Office of the Comptroller or any
other State agency to establish responsibilities, duties, and
procedures for complying with the Comptroller's Offset System
under Section 10.05 of the State Comptroller Act. All federal
and State tax reporting and withholding requirements relating
to prize winners under this Section shall be the responsibility
of the Department. Moneys from this account may not be used to
pay amounts to deferred prize winners. Moneys may not be
transferred from the State Lottery Fund to this account for
payment of prizes under this Section until procedures are
implemented to comply with the Comptroller's Offset System and
sufficient internal controls are in place to validate prizes.
(Source: P.A. 87-1197; 88-676, eff. 12-14-94.)
(20 ILCS 1605/20.2 new)
Sec. 20.2. Lottery Supports Schools Fund. There is created
a Fund to be known as the Lottery Supports Schools Fund, which
is a non-appropriated trust fund held outside of the State
treasury. The Fund shall consist of moneys paid into it by the

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Division as provided in this Law. The Division shall certify
each month to the State Board of Education the proportion of
lottery sales in each school district in relation to statewide
lottery sales. The moneys in the Lottery Supports Schools Fund
must be distributed monthly by the State Board of Education to
each school district based upon that school district's portion
of statewide lottery sales.
Section 10. The School Code is amended by adding Section
2-3.148 as follows:
(105 ILCS 5/2-3.148 new)
Sec. 2-3.148. Distributions from the Lottery Supports
Schools Fund. The State Board of Education shall make
distributions from the Lottery Supports Schools Fund as
provided in Section 20.2 of the Illinois Lottery Law; however,
the State Board of Education shall not take into account these
distributions when computing State aid under Section 18-8.05 of
this Code.
Section 99. Effective date. This Act takes effect upon