Chapter Sw 100 Organization
Chapter Sw 200 Rules of Practice and Procedure
Chapter Sw 300 Rules for Sales Agents
Chapter Sw 500 Rules for Prize Assignment
Chapter Sw 600 Rules for Prize Claims
Chapter Sw 900 Rules for Sweepstakes Lottery Intercept
Chapter Sw 1000 Rules for All Instant Lottery Games
Chapter Sw 5000 Rules of Multi-State Lottery Association Games
Chapter Sw 6000 Rules for Second Chance Drawings
Tri-State Lotto Commission
Policies
1. Expense Reimbursement
2. Contingency Fund(s)
3. Standing Committees with the Tri-State Commission
4. Drawings Monitored Via a Tri-State Representative
5. Ownership of Tri-State Annuities and/or Investments
6. Prize Verification
7. Request for Jackpot Winners List
8. Jackpot Payments Made Within 5 Business Days
9. No Cancel Policy
10. Annual Budget including State-Specific Advertising Dollars
11. Tri-State Business Office
12. Conflict of Interest
13. Out-of-Balance Condition
14. Minimum Testing Standards Checklist
15. Standards for Sales Promotions
16. Authorization to Hire Tri-State Employees
17. Retailer Incentive Prize
18. Departure of Party Lottery or Termination of Tri-State Compact
19. Funding Promotional Raffle Games
20. Investments
POLICY NO. 1:
TRI-STATE LOTTO COMMISSION
EXPENSE REIMBURSEMENT POLICY
(Amended April 6, 1999)
(Amended February 12, 2015)
Definitions:
Expense Reimbursement: The term shall apply to either:
Reimbursements of monies advanced out-of-pocket for Tri-State expenses authorized under this policy.
Tri-State expenses authorized under this policy and charged to a Tri-State credit card account.
Receipt: Shall mean an actual receipt obtained representing goods or services purchased.
If the goods or services are charged to a Tri-State credit card, a receipt that includes an itemized detail of the purchase,
as well as the purchaser's copy of the credit card charge is required. Amounts of individual expenditures less
than $5.00 do not require a receipt. Notwithstanding the above, a detailed explanation of the expenditure, signed by
the purchaser, may be used in case of a lost or misplaced receipt that cannot be obtained or reconstructed.
Tri-State Business: Is defined to include regular monthly Tri-State committee meetings and commission
meetings, special committee or commission meetings, industry conferences such as NASPL, media presentations and workshops.
Other types of meetings not covered in this definition may be sanctioned by the commission for purposes of payment of
per diems when the meeting is held for Tri-State business purposes.
Expense Reimbursement:
- All Commission members, staff, and/or Directors shall be reimbursed for all necessary and reasonable expenses incurred
for Tri-State operations providing they are generally consistent with the intent of the expense reimbursement policies
of the Tri-State Commission. When a Commission member, a Director or staff is accompanied by a guest or spouse
when traveling on lottery business or attending a lottery meeting, no expenses of the guest or spouse shall be charged
to the Tri-State Commission. The guest or spouse will be personally responsible for all travel, meals and incidental
expenses. If there is a differential between single and double occupancy hotel rates, the spouse or guest will
be responsible to pay the difference between the single and double occupancy rate.
At Tri-State meetings, meals which are held for the convenience of Tri-State and where business is transacted will
be reimbursed in full when a receipt is submitted. Meals, lodging or other expenses incurred by vendors, spouses
and guests will not be paid or reimbursed by Tri-State.
-
Prior to submission to the Tri-State Business Office for reimbursement, each respective state's lottery Executive Director,
or designee, shall have approved said expenses thereby certifying compliance with this Tri-State Expense Policy.
The Tri-State Business Office expense reimbursement requests shall be approved by a Tri-State Commissioner or a Director.
-
Each Commissioner shall have the authority to approve any business expense forms, except their own, in keeping with this
policy. It is prohibited for a person to approve their expense voucher; therefore, a Tri-State Commissioner,
Director, or designee, can sign an expense reimbursement voucher for the other.
Expense Guideline:
-
No alcoholic beverage charges will be reimbursed
-
Meal expenses not accompanied by a receipt shall not exceed on a per person basis:
a. Dinner: $25.00
b. Lunch: $12.00
c. Breakfast: $10.00
Meal expenses from higher cost of living areas of the country may be approved by any state’s director or commissioner
provided that it is supported by a detailed receipt.
-
Mileage shall be at the business reimbursement rate as determined by each party member not to exceed the reimbursement
rate as determined from time to time by the Internal Revenue Service.
-
When meals are not provided, per diem shall be paid to Tri-State Commissioners for each day Tri-State business is
conducted as defined above, or for meetings not defined above, but designated as meetings eligible for per diem
by the Tri-State Commission. Applicable daily per diem will be paid for travel to and from a business meeting
unless travel time can be reasonably accomplished on the same day as the business meeting.
-
With the exception of the recording secretary provided by Vermont, each state's delegation for overnight accommodations
and meals will not exceed six people unless unanimous consent is granted by the Tri-State Commission.
-
Reimbursement for Travel:
Authorized persons may elect to travel by personal automobile or commercial carrier at their option. However,
expense reimbursement may not exceed the least cost method of travel, including consideration for in-transit
hotels and meals.
When automobile travel is utilized, authorized reimbursement for transportation shall be limited to the amount
of the round trip coach air fare. Expenses for any additional travel days beyond those which would have
been incurred had regular air travel been utilized are not compensable. This is interpreted to mean that
if travel could be accomplished in one day by air and it would take two or more days by auto, the meal and hotel
expenses of the first and subsequent days cannot be claimed. However, the transportation costs of the first
and second days, etc. including mileage, tolls, and parking are reimbursable up to the amount of the regular
coach airfare. Persons electing to travel by auto should obtain airfare quotes from their travel
agency to base the reimbursement on. It is expected that a good faith attempt will be made to obtain the
lowest cost commensurate with schedule and service convenience.
-
General:
The Tri-State credit card may be used only for expenses authorized under this policy.
All expenses authorized under this policy will be submitted on an appropriate expense reimbursement form and
sent to the Executive Director, or designee, of the respective state for approval. The Executive Director,
or designee, will then forward the approved expense reimbursement form to the Tri-State Business Office.
Expense reimbursement forms must be signed by the person requesting reimbursement and the state's Executive
Director, Tri-State Commissioner or designee.
If the respective state's Executive Director, or designee, determines that the expense reimbursement request
is inappropriate under the terms of this policy, the entire expense reimbursement request will be returned to
the requestor for further clarification.
NOTE: Credit card charges may be included on the same form as reimbursable expenses. The appropriate
credit card receipt shall include the actual receipt of goods tendered as well as a copy of the credit card charge
and be attached to the form.
This policy requires that all Tri-State expenses, whether credit card or reimbursement, is explained in full
on the expense form.
Any expense reimbursement request which is either not in accordance with this policy or not covered in this
policy will be submitted to the Commission by the Director of a party state or the Chair of the Finance Committee
for consideration of approval.
POLICY NO. 2:
TRI-STATE LOTTO COMMISSION
CONTINGENCY FUND(S)
(Amended June 2, 2000)
(Amended June 12, 2015)
(Amended June 3, 2016)
Monies constituting the difference between the calculated prize pool and the actual prizes awarded, whether annuitized
or cash, shall be placed each week in a Contingency Fund, per the game rules, which will be allowed to accumulate.
These funds shall be used to pay off guaranteed jackpots, if needed, but are not restricted solely to this disbursement.
A contingency fund may be accumulated in one or more bank or investment account. Monies shall be pooled in order
to maximize interest earned.
A contingency fund must not be less than 50% of its approved threshold at fiscal year-end. Any TS game contingency
fund balance that exceeds its established threshold on June 30
th can have all or part of that excess transferred to another TS game contingency fund that is less than 50% of
its approved threshold as of June 30
th. Expired, unclaimed prizes will be used to offset any remaining deficient contingencies. Contingency
fund threshold amounts will be recommended by the Finance Committee and approved by the Commission.
Disbursement of Designated Prize Reserves shall be determined by a unanimous vote of the Commission.
To achieve the initial recommended contingency fund balance of $1 million for Megabucks as of June 30, 2016, each lottery
shall contribute the following percentage of the amount needed to raise an amount not to exceed $1 million: ME =48.1%,
NH=34.77%, and VT=17.12%.
To achieve the initial recommended contingency fund balance of $300,000 for Gimme 5 as of June 30, 2016, each lottery
shall contribute the following percentage of the amount needed to raise an amount not to exceed $300K: ME =28.83%, NH=55.57%,
and VT=15.60%.
(Note: The following thresholds were approved by the Commission on June 12, 2015 – Pick 3 - $700,000; Pick 4 -
$1,400,000)
(Note: Finance Committee recommends the following thresholds – Megabucks - $1,000,000; Gimme 5 - $300,000)
POLICY NO. 3:
TRI-STATE LOTTO COMMISSION
STANDING COMMITTEES WITH THE TRI-STATE COMMISSION
(Amended July 11, and ratified August 1, 2008)
(Amended July 9, 2010)
(Amended November 2, 2012)
Tri-State shall have three standing committees: Marketing & Development, Draw, and Finance. Each committee
will be appointed annually by the directors at the Commission's July meeting. With the exception of the Marketing
& Development Committee, whose chairperson shall be from the state of the current Tri-State Commission Chairperson,
each of the other committees shall select its own chairperson from its membership.
* See Tri-State minutes dated July 15, 2005, for description and duties of the Development Committee.
The Operations Committee was disbanded in Nov 2012 by a unanimous vote of the Commission. Future guidance and
direction for operational matters will come through the Marketing & Development Committee.
POLICY NO. 4:
TRI-STATE LOTTO COMMISSION
DRAWINGS MONITORED VIA A TRI-STATE REPRESENTATIVE
(Adopted August 6, 1987)
(Amended April 6, 1999)
A Tri-State representative shall monitor all on-line drawings and the Tri-State Commission shall compensate those monitors
on a per diem basis.
POLICY NO. 5:
TRI-STATE LOTTO COMMISSION
OWNERSHIP OF TRI-STATE ANNUITIES AND/OR INVESTMENTS
Tri-State jackpot annuities or other investments remain the property of Tri-State.
POLICY NO. 6
:
TRI-STATE LOTTO COMMISSION
PRIZE VERIFICATION
(Amended November 2, 1999)
No one may claim a prize without presentation of a valid ticket issued and authenticated by a state and/or Tri-State,
along with the proper identification as required by the individual states for all tickets worth $500.00 or more or
as required by the individual party states.
POLICY NO. 7
:
TRI-STATE LOTTO COMMISSION
REQUEST FOR JACKPOT WINNERS LIST
(Adopted January 8, 1993)
(Amended April 6, 1999)
Requests for a listing of jackpot winners' names will be honored upon a written request. Such a list would
include winner's name, home town and amount won (designated as either cash or annuity payment).
POLICY NO. 8
:
TRI-STATE LOTTO COMMISSION
JACKPOT PAYMENTS MADE WITHIN 5 BUSINESS DAYS
(Adopted February 5, 1993)
(Amended April 6, 1999)
(Amended February 12, 2015)
The Business Office will issue payment for the second and remaining Megabucks jackpot payments within five business days
of the anniversary of the draw date on which the jackpot was won unless the jackpot winner instructs the Business
Office to the contrary in writing. This policy applies only to jackpot payments issued by the Tri-State Lotto
Commission Business Office.
For jackpots payable on a monthly basis, the Tri-State Business Office may choose to make payment on or around the 1
st
of each month, but no later than the 5
th
business day of each month.
POLICY NO. 9:
TRI-STATE LOTTO COMMISSION
NO CANCEL POLICY
(Adopted June 10, 1994)
(Amended June 1, 2001)
A ticket may be canceled by returning the ticket to the selling agent/retailer, provided, that the ticket is returned
to the agent/retailer on the same day that it was purchased, and, if purchased on the drawing day for the ticket,
in time to permit cancelling to be fully completed prior to draw break of that day’s drawing(s).
POLICY NO. 10:
TRI-STATE LOTTO COMMISSION
ANNUAL BUDGET INCLUDING
STATE-SPECIFIC ADVERTISING DOLLARS
(Adopted March 3, 1995)
(Amended April 6, 1999)
(Amended February 12, 2015)
The Finance Committee Chair, or designee, shall submit an annual budget for Tri-State, broken out by state, for Commission
approval by the first Tri-State meeting of each fiscal year. This budget will include the advertising dollars
for each state. The Commission will vote to accept or deny the budget request. This budget shall be revised
if necessary at least once in the course of a fiscal year with the approval of the Commission.
The participant states may expend their advertising dollars at their own discretion provided that these monies are
expended for the promotion of Tri-State products or in combination with the state’s lottery brand.
Monies budgeted to each state which remain unexpended at period end will remain with that state as an addition to
its profit.
POLICY NO. 11:
TRI-STATE LOTTO COMMISSION
TRI-STATE BUSINESS OFFICE
(This policy was formerly Megabucks Rule 11 (b))
(Amended April 6, 1999)
The Commission shall establish a Tri-State Business Office for the purpose of managing prize disbursements and expenditures.
The location of the Business Office shall be determined by the Commission and may be changed at the direction of
the Commission.
POLICY NO. 12:
TRI-STATE LOTTO COMMISSION
CONFLICT OF INTEREST
(Adopted April 6, 1999)
The Tri-State Commission shall not issue a contract for services for products to a company or person who employs, or
is, a family member of a lottery employee that has an administrative responsibility over any of the duties specified
in the contract, or who may be involved in the decision to award the contract. A family member is defined as
a person living in the same primary residence as the lottery employee. A lottery employee is defined as an
employee of the Maine, New Hampshire or Vermont lotteries, or the Tri-State Commission.
POLICY NO. 13:
T
RI-STATE LOTTO COMMISSION
OUT-OF-BALANCE CONDITION
(Adopted June 2, 2000)
(Amended April 10, 2015)
For any out-of-balance condition for any game which requires jackpot management on draw nights the following procedures
will take place.
Sales Imbalances:
States with Lockdown procedures:
If the out-of-balance condition occurs in balancing Sales totals during draw break, ICS staff shall notify the Draw
Room of this and initiate Lockdown procedures. An out-of-balance condition report shall be forwarded to the
other states within two business days to the Drawing Manager.
States with MUSL-approved Lockdown Alternative procedures:
If the out-of-balance condition occurs in balancing Sales totals during draw break, ICS staff shall notify the Draw
Room of this and initiate Lockdown Alternative procedures. An out-of-balance condition report shall be forwarded
to the other states within two business days.
Winners Imbalances:
If an out-of-balance condition occurs for prizes, the jackpot management coordinator shall be notified immediately.
For states with MUSL-approved Lockdown Alternative procedures, in addition to the procedures below, the ICS staff
shall follow their Lockdown Alternative procedures for a winners/prizes out-of-balance situation, which allows Lottery
Security to capture and control POST-DRAW wager data for comparison the following business day.
For prizes out-of-balance within Prize Tiers that allow for Agent terminal payment, the ICS staff shall contact
that state’s Director for notification. That state’s Director shall enact procedures to suspend
all payments in that state until the issue is successfully resolved.
For prizes out-of-balance which exceed Agent payout but are not Jackpot winning prizes, the ICS staff shall contact
that state’s Director for notification. That state’s Director shall then enact procedures to suspend
all payments in that state and notify the other state’s Director of the issue. Once ICS staff has successfully
solved the imbalance, notification will be made and payments enabled. Lottery Security shall investigate the
following business day.
For prizes out-of-balance which involve a jackpot winner, ICS staff will notify their respective peers who will
notify their state’s Director immediately. Payments will be suspended immediately in the affected state
until Lottery Security can investigate the issue thoroughly the following business day. Once the issue has
been resolved payments will be enabled.
POLICY NO. 14:
TRI-STATE LOTTO COMMISSION
MINIMUM TESTING STANDARDS CHECKLIST
(Adopted June 2, 2000)
(Amended February 12, 2015)
Each state will follow MUSL standards or other industry approved standards for testing games, promotions and other changes
to their lottery gaming systems.
POLICY NO. 15:
TRI-STATE LOTTO COMMISSION
STANDARDS FOR SALES PROMOTIONS
(Adopted October 5, 2001)
(Amended July 11, 2012)
(Amended October 5, 2012)
(Amended February 12, 2015)
The Tri-State Lotto Commission or a party state(s) may enact a promotion for the explicit use of encouraging an increase
in Tri-State ticket sales.
A party member state shall have the privilege to conduct a state promotion with the use of individual advertising
monies. The Marketing Director of a party state, or designee, will, out of common courtesy prior to the promotion
commencement, provide the Commission with details concerning the promotion. This would include, but is not
limited to, timeframe of promotion, what the promotion consists of and what the party state hopes to achieve.
Following the promotion, an analysis of the promotion will be presented by the party state.
Per game rules, at least once a year the Commission is required to make a decision as to the disbursement of expired
unclaimed prize money. The Chair of the Marketing Committee or Development Committee, in concurrence with the
Finance Committee Chair, shall request a sum of expired unclaimed prizes to be allocated to each of the member states
proportional to each states total sales for the most recent fiscal year ended to be used for promotions or promotional
games. This request shall be made by the first Tri-State Lotto Commission meeting of each fiscal year. At the
end of the fiscal year, each member state is authorized to carry over any unused allocation amount not to exceed
50% of the allocation for that fiscal year. Each member state’s carry forward amount will be added to
the allocation for the new fiscal year. The new allocation will become subject to the 50% threshold at the
end of the fiscal year. Any carry forward amount that is unused after 24 months lapses back to the Expired
Unclaimed Prize Fund. Each member state’s unspent balance as of June 30, 2012 will be added to their
recommended allocation for Fiscal Year 2013. This total will be subject to the twelve month measurement at
the end of Fiscal Year 2013.
Promotions that involve the use of expired, unclaimed prize money shall not exceed the approved allocation of expired
unclaimed prizes for any state. Any state wishing to use expired unclaimed prize money for a promotion must
provide the Development Committee with the details of the promotion in a timely manner in order to allow the other
states to also participate in the promotion. The Chair of the Marketing Committee or Product
, Development Committee, or designee, will review the promotion during a commission meeting, and provide
the Commission with details concerning the promotion. This would include, but is not limited to, the timeframe
of the promotion, what the promotion consists of and what the Commission hopes to achieve. This type of promotion
shall be brought to the attention of the Tri-State Lotto Commission for a vote of approval. Following the promotion,
an analysis of the promotion will be presented by the Chair of the Marketing and Product Development Committee, or
designee.
If any state inadvertently or otherwise exceeds their approved allocation of expired unclaimed prizes, state specific
advertising dollars will be used to supplement the promotion.
The Development Committee will prepare a standardized presentation to report promotion goals in advance and promotion
results after completion.
POLICY NO. 16:
TRI-STATE LOTTO COMMISSION
AUTHORIZATION TO HIRE TRI-STATE EMPLOYEES
(Adopted November 2, 2001)
The executive director, or the director’s designee, of each party lottery is authorized to hire and terminate personnel
for positions within that director’s state, for games authorized by the Tri-State Commission.
POLICY NO. 17:
TRI-STATE LOTTO COMMISSION
RETAILER BONUS PRIZE
(Adopted July 11, 2002)
In addition to any retailer bonus prize authorized by the Commission on any Tri-State game, a member lottery may establish
additional bonus prizes for other lower tier prize levels, in accordance with a member lottery’s rules and
regulations. The cost for these lower tier bonus prizes shall be borne by the paying member lottery.
POLICY No. 18:
TRI-STATE LOTTO COMMISSION
DEPARTURE OF PARTY LOTTERY OR TERMINATION OF TRI-STATE COMPACT
(Adopted February 4, 2005)
The Commission, on unanimous vote of the Party Lotteries, may terminate the Compact, effective on a date established
by the Commission, in conformance with applicable law. Likewise, a Party Lottery may withdraw from the Compact
with due notice to the Commission and in accordance with applicable law and Commission policy. However, the
Compact or a Party Lottery’s membership in the Compact shall terminate no sooner than the latest date of an
advanced play bet on a terminated Party Lottery’s gaming system. A full financial external audit shall be performed
prior to distribution of any funds to any Party Lotteries.
Termination of the Tri-State Compact.
Upon termination of the Tri-State Lotto Compact, any assets acquired by the Tri-State Lotto Commission (the Commission)
shall be liquidated, with the exception of the designated reserve fund, the operational accounts essential to support
residual post-termination Commission operations, and investment and deposit fund contracts held for lottery payments
to jackpot winners. Party Lotteries that have valid subscriptions shall refund to their players the value of
remaining draws following the termination date. The Commission shall provide the Tri-State Business office with reasonable
funds to perform the duties required of it until such time as all Tri-State assets are liquidated and jackpot payments
are transferred to the respective lotteries in accordance with this policy.
On termination of the Tri-State Compact, the distribution of any assets shall be as follows:
CLAIMED JACKPOT PAYMENTS. The responsibility of claimed lottery payments to jackpot winners, and the required funds or
investments to make those payments, shall be transferred to the Party Lottery of the State where the claim originated.
In the event that an insurer defaults on an investment fund contract and the designated reserve account is not adequate
to pay the jackpot winner, all three Party Lotteries shall be responsible for their pro rata shares of liability
to the jackpot prize winner based on their respective average sales for the game at issue over the 12 month period
preceding and up to the date of termination.
DESIGNATED PRIZE RESERVE. The Commission shall use one half of the designated prize reserve fund balance as
a reserve fund for investment fund contracts. This reserve fund shall be placed in an interest-bearing escrow
account until such time as all investment fund contracts, and insurer obligations thereunder, expire. Once
all insurer obligations under applicable investment fund contracts have been fulfilled, the escrow account shall
be distributed to the Party Lotteries pro rata based on the Party Lotteries proportional average sales over the 12
month period preceding and up to the date of termination. On termination and after the requisite financial
audit, the remaining half of the designated prize reserve fund shall be distributed to the Party Lotteries pro rata
based on the Party Lotteries’ proportional average sales over the 12 month period preceding and up to the date
of termination. Before receiving its pro rata share of either half of the designated prize reserve fund, the
Party Lottery must first execute a Memorandum of Understanding or equivalent agreement with the other Party Lotteries
committing it to expend its pro rata share as prizes to its lottery players and for no other purpose.
UNEXPIRED UNCLAIMED LOW-TIER PRIZES. Low-tier Tri-State game prize amounts unclaimed but not yet expired
at time of termination of the compact shall be returned to the Party Lottery that sold the ticket. The Party Lottery
to whom funds are returned, shall have sole responsibility for payment of any subsequent claims on the returned low-tier
prize amounts. After the period of one year any unclaimed prize amounts shall be awarded to the Party Lottery’s
players. A prerequisite to any Party Lottery receiving its pro rata share of the unclaimed prize amounts is that
the terminating Party Lottery must execute a Memorandum of Understanding or equivalent agreement with the Commission
committing it to expend its pro rata share as prizes to its state lottery players and for no other purpose.
UNCLAIMED JACKPOT PRIZE. Upon termination of the compact, the cash value of any unclaimed jackpot prize will
remain with the Tri-State Business Office until claimed. If upon termination there are any unclaimed jackpots, contingency
funds shall be withheld from distribution to member states in an amount to allow the Business Office to purchase
an investment to fund an annuity payment if necessary to pay such jackpot. If after a period of one year from draw
date the jackpot prize is not claimed, the pertinent funds, including interest, shall be distributed to each Party
Lottery pro rata based on their respective average sales for the game at issue over the 12 month period preceding
and up to the date of termination. The jackpot prize values shall be awarded to each Party Lottery’s players.
EXPIRED UNCLAIMED LOW-TIER PRIZES. Any expired unclaimed low-tier prizes shall be distributed to each member
state pro rata based on their respective average sales for the game at issue over the 12 month period preceding and
up to the date of termination. These prize values shall be awarded to each member state’s players.
PRIZE CONTINGENCY FUNDS. The prize contingency funds shall be maintained by the Commission in an interest-bearing
escrow account for one year following the date of termination at which time the remaining funds shall be distributed
to the Party Lotteries pro rata based on the Party Lotteries’ proportional average sales over the 12 month
period preceding and up to the date of termination.
REMAINING ASSETS. Any remaining assets held in equity, except for retained operational funds, shall be distributed
to each member state pro rata based on the Party Lotteries’ proportional average sales over the 12 month period
preceding and up to the date of termination. Upon termination, and after wind-up operations of the Tri-State Lotto
Compact have concluded, any net profit or loss and any interest earned shall be distributed to each member state.
For any income or expenses normally apportioned based upon percentage of sales, such percentage shall be pro rata
based on the Party Lotteries’ proportional average sales over the 12 month period preceding and up to the date
of termination.
Termination by a Party Lottery of its Participation in the Tri-State Compact
If a Party Lottery terminates its membership in the Compact, the Compact shall continue pertaining to the remaining
Party Lotteries. The respective rights and obligations of the Party Lotteries shall be as follows.
LOW TIER PRIZES. All unclaimed low-tier prize amounts pertaining to tickets sold in the terminating Party
Lottery’s state, shall be returned to that Party Lottery within 30 days after the full financial audit. The
terminating Party Lottery shall have sole responsibility for payment of any subsequent claims on the returned low-tier
prize amounts. A prerequisite to receiving its pro rata share of the prize amounts is that the terminating Party
Lottery must execute a Memorandum of Understanding or equivalent agreement with the Commission committing it to expend
its pro rata share as prizes to its state lottery players and for no other purpose.
JACKPOT PRIZES. The Commission shall retain responsibility for payment of jackpot annuities and shall retain
the investment and deposit fund contracts held for lottery payments to jackpot winners. In the event that an insurer
defaults on an investment fund contract issued prior to the date of withdrawal of the terminating Party Lottery, the
terminating Party Lottery shall be responsible for its pro rata share of liability to the jackpot prize winner based
on the respective Party Lottery average sales for the game at issue over the 12 month period preceding and up to the
date of termination.
UNCLAIMED JACKPOT PRIZES. If upon termination there are any unclaimed jackpots, contingency funds shall be
withheld from distribution to that state in an amount to allow the Business Office to purchase an investment to fund
an annuity payment if necessary to pay such jackpot. All other contingency funds shall be distributed in accordance with
this policy as described below. If after a period of one year from draw date the jackpot prize is not claimed, the pertinent
funds, including interest, shall be distributed to the Party Lotteries pro rata based on their respective average sales
for the game at issue over the twelve month period preceding and up to the date of termination. The jackpot prize
value shall be awarded to the Party Lotteries’ players.
DESIGNATED PRIZE RESERVE FUND. On termination by a Party Lottery of its participation in the Compact, The
Commission shall equally divide the designated prize reserve fund into two separate accounts. The first account
will serve as a reserve fund for investment fund contracts issued prior to the date of withdrawal of the terminating
Party Lottery. The account shall be placed in an interest-bearing escrow account until such time as all investment fund
contracts in place at the time of the Party Lottery’s termination expire. Once all insurer obligations under
applicable investment fund contracts have been fulfilled, the Commission shall pay to the terminating Party Lottery its
pro rata share of the balance of the first account. The second account will serve as the designated prize
reserve for all Tri-State Lotto Commission games. After the requisite Memorandum of Understanding or equivalent
is executed as provided in the following paragraph, and on completion of the financial audit required pursuant to the
first paragraph of this policy, , the Commission shall pay the terminated Party Lottery its pro rata share of the balance
of the second account.
A prerequisite to receiving its pro rata share of the first or second account is that the terminating Party Lottery
must execute a Memorandum of Understanding or equivalent agreement with the Commission committing it to expend its pro
rata share as prizes to its state lottery players and for no other purpose. A Party Lottery’s pro rata share,
pertaining to both accounts, shall be based on the Party Lotteries proportional average sales over the 12 month period
preceding and up to the date of the departing Party Lottery’s termination.
EXPIRED UNCLAIMED LOW-TIER PRIZES. Any expired unclaimed low-tier prizes shall be distributed to the terminating
Party Lottery pro rata based on its respective average sales for the game at issue over the 12 month period preceding
and up to the date of termination. These prize values shall be awarded to the terminating Party Lottery’s players.
CONTINGENCY FUNDS. After the requisite Memorandum of Understanding or equivalent is executed as provided in the
following sentence, and on completion of the financial audit required pursuant to the first paragraph of this policy,
the Commission shall pay the terminated Party Lottery its pro rata share, as determined in the preceding paragraph, of
the various game contingency accounts. A prerequisite to receiving its pro rata share of the contingency account
is that the terminating Party Lottery must execute a Memorandum of Understanding or equivalent agreement with the Commission
committing it to expend its pro rata share as prizes to its state lottery players and for no other purpose.
A Party Lottery that withdraws prior to termination of the Compact shall be entitled to its pro rata share of the operational
account based on the withdrawing Party Lottery’s average sales for the game at issue over the 12 month period preceding
and up to the date of termination. However, the withdrawing Party Lottery shall be entitled to its state-specific
operational accounts in the amount of its unexpended contribution as of the date of withdrawal. The Party Lottery
is not otherwise entitled to any share of the property or assets of the Commission except as provided herein.
POLICY NO. 19:
TRI-STATE LOTTO COMMISSION
FUNDING PROMOTIONAL RAFFLE GAMES
(Adopted December 28, 2007)
For the purpose of funding the expenditures associated with Tri-State Lotto Commission Raffle-type promotional games,
the Business Office shall first, on a weekly basis, allocate sales associated with a Raffle game to operating expenses
directly related to the game (including agent commissions, vendor fees, and weekly contributions for general operating
costs) per a predetermined percentage of each state’s sales, as well as to a prize pool for future payment
of prizes and agent bonuses up to an amount as determined by game rules. Any excess of sales, after operating
expenses, prize pool and agent bonuses have been fully funded, shall remain with the states. After tickets
for a particular Raffle are no longer available for sale, any shortfall in a prize pool for a Raffle game shall be
supplemented with expired, unclaimed prize money in order to fully fund the prizes.
POLICY NO. 20:
TRI-STATE LOTTO COMMISSION
INVESTMENT POLICY
(Adopted March 4, 2016)
(Amended November 3, 2017)
Investment Objective:
To achieve the maximum return while simultaneously protecting principle. The allocation range for the investments
should be five percent (5%) to twenty percent (20%) in cash and eighty percent (80%) to ninety-five percent (95%)
in authorized investments. Maturity dates shall be staggered over a five-year period with 20% of the investments
maturing each year. No investments shall be for more than 5 years.
Types of Authorized Investments:
Permitted investments shall include the direct obligations of the United States Government, obligations issued
or guaranteed as to payment of principal and interest by agencies or instrumentalities of the United States Government,
investment grade corporate bonds, and mutual funds of approved investments.
Review:
The Chair of the Tri-State Lotto Commission Finance Committee shall review, on a monthly basis, the status of
the investments and report the status to the Commission at least annually.
Benchmark:
The Tri-State Lotto Commission (TSL) has adopted the Bank of America 3-month Treasury Bill index as the benchmark
for the ultra-short portion of the portfolio. The subaccount with the slightly longer allowable maturities
will use the Bank of America 6-month Treasury Bill index as the benchmark. The combined account will use the
Bank of America 6-month Treasury Bill index as the benchmark.