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Searching 2017-2018 Session

The Vermont Statutes Online

Title 31: Recreation and Sports

Chapter 023: GAMES OF CHANCE

  • § 1201. Definitions

    As used in this chapter:

    (1) "Break-open ticket" means a lottery utilizing a card or ticket of the so-called pickle card, jar ticket, or break-open variety commonly bearing the name "Lucky 7," "Nevada Club," "Victory Bar," "Texas Poker," "Triple Bingo," or any other name.

    (2) "Commissioner" means the Commissioner of Liquor Control.

    (3)(A) "Distributor" means a person that purchases break-open tickets from a manufacturer and sells or distributes break-open tickets at wholesale in Vermont. "Distributor" shall include any officer, employee, or agent of a corporation or dissolved corporation that has a duty to act for the corporation in complying with the requirements of this chapter.

    (B) "Distributor" shall not include a person who distributes only jar tickets that are used only for merchandise prizes.

    (4) "Manufacturer" means a person that designs, assembles, fabricates, produces, constructs, or otherwise prepares a break-open ticket for sale to a distributor.

    (5) "Nonprofit organization" means a nonprofit corporation that is qualified for tax exempt status under I.R.C. § 501(c), as amended, and that has engaged, in good faith, in charitable, religious, educational, or civic activities in Vermont on a regular basis during the preceding year. "Nonprofit organization" also includes churches, schools, fire departments, municipalities, fraternal organizations, and organizations that operate agricultural fairs or field days, and that have engaged, in good faith, in charitable, religious, educational, or civic activities in Vermont on a regular basis during the preceding year. An organization shall be considered a nonprofit organization under this subdivision only if it certifies annually, on a form with whatever information is required by the Commissioner, how it meets the definition under this subdivision. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1202. License required

    (a) Manufacture. Break-open tickets sold in Vermont shall be manufactured only by a person licensed by the Commissioner. A licensed manufacturer shall sell break-open tickets only to distributors licensed under this chapter. A distributor licensed under this chapter shall purchase break-open tickets only from a manufacturer licensed under this chapter.

    (b) Distribution. A distributor who sells or distributes break-open tickets for resale in Vermont shall be licensed by the Commissioner and shall also be:

    (1) a natural person who is a resident of Vermont;

    (2) a partnership in which the majority of partners are residents of Vermont;

    (3) a corporation incorporated under the laws of Vermont, provided that a majority of the ownership interest is held by residents of Vermont; or

    (4) a person who is not a resident of Vermont and whose state of residence allows residents or corporations of Vermont to distribute break-open tickets in that state under similar terms and conditions as provided under this chapter. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1203. Distribution; retail purchase and sale

    (a) Only nonprofit organizations may purchase break-open tickets from a distributor licensed under this chapter.

    (b) No person, other than a licensed distributor or a nonprofit organization acting under subsection (f) of this section, shall distribute a box of break-open tickets. No person shall distribute a box of break-open tickets unless the box bears indicia as required by the Commissioner. No person shall distribute or sell a break-open ticket at retail unless the ticket bears a unique serial number.

    (c) A distributor licensed under this chapter may sell break-open tickets only to nonprofit organizations as defined in subdivision 1201(5) of this chapter, except that a person other than a licensed distributor may sell such tickets to a licensed distributor upon written approval of the Commissioner.

    (d) Only nonprofit organizations may sell break-open tickets at retail.

    (e) Break-open tickets shall not be sold at premises licensed to sell alcoholic beverages except:

    (1) at clubs as defined in 7 V.S.A. § 2; or

    (2) a nonprofit organization may sell break-open tickets at premises licensed to sell alcoholic beverages if, notwithstanding 13 V.S.A. § 2143(e), all proceeds from the sale of break-open tickets are used by the nonprofit organization exclusively for charitable, religious, educational, and civic undertakings, with only the following costs deducted from the proceeds:

    (A) actual cost of the break-open tickets;

    (B) the prizes awarded;

    (C) reasonable legal fees necessary to organize the nonprofit organization and to ensure compliance with all legal requirements; and

    (D) reasonable accounting fees necessary to account for the proceeds from the sale of break-open tickets.

    (f) A nonprofit organization that sells break-open tickets, other than a club as defined in 7 V.S.A. § 2, shall report to the Department of Liquor Control on a quarterly basis the number of tickets purchased and distributed, and the corresponding serial numbers of those tickets, the amount of revenue realized by the nonprofit organization, and the amounts accounted for under subdivisions (e)(2)(A)-(D) of this section. The nonprofit organization shall also identify an individual from the organization responsible for the reporting requirements under this subsection. If the Department of Liquor Control determines that a nonprofit organization has failed to comply with the requirements of this subsection, the Department of Liquor Control shall notify the nonprofit organization and any licensed distributors of this failure, and any licensed distributor that continues to sell break-open tickets to that nonprofit organization after notice shall be considered in violation of the requirements of this chapter until the Department of Liquor Control has determined the nonprofit organization is back in compliance with this subsection.

    (g) The provisions of this chapter regarding sales and purchases of break-open tickets also apply to transfers of break-open tickets for no charge. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1204. License requirements; fees

    (a) Upon application and payment of the fee, the Commissioner may issue the following licenses to qualified applicants:

    (1) Manufacturer annual license: $3,000.00.

    (2) Distributor annual license: $2,000.00.

    (b) A license shall not be granted to an individual who has been convicted of a felony within five years of the license application nor to an entity in which any partner, officer, or director has been convicted of a felony within five years of the application.

    (c) Licenses issued under this section may be renewed annually on October 1, upon reapplication and payment of the licensing fee.

    (d) All fees collected pursuant to this section shall be deposited into the Liquor Control Enterprise Fund. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1205. Records; report

    (a) Each distributor and manufacturer licensed under this chapter shall maintain records and books relating to the distribution and sale of break-open tickets and to any other expenditure required by the Commissioner. A licensee shall make its records and books available to the Commissioner for auditing.

    (b) Each licensed distributor shall file with the Commissioner, on the same schedule as the distributor files sales tax returns, the following information for the preceding reporting period:

    (1) the names of organizations to which boxes of break-open tickets were sold;

    (2) the number of boxes of break-open tickets sold to each organization; and

    (3) the ticket denomination and serial numbers of tickets for each box.

    (c) Records and reports filed under this section shall be designated confidential unless, under State or federal law or regulation, the record or information may be disclosed to specifically designated persons.

    (d) Notwithstanding subsection (c) of this section, the Commissioner of Liquor Control shall provide the records and reports filed under this section to the Attorney General, upon request. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1206. Enforcement

    (a) Any person who intentionally violates section 1203 of this chapter shall be fined not more than $500.00.

    (b) Any person who intentionally violates section 1202, 1204, or 1205 of this chapter shall be fined not more than $10,000.00 for the first offense and fined not more than $20,000.00 or imprisoned not more than one year, or both, for each subsequent offense.

    (c) In addition to the criminal penalties provided under subsections (a) and (b) of this section, any person who violates a provision of this chapter shall be subject to one or more of the following penalties:

    (1) Revocation or suspension by the Commissioner of a license granted pursuant to this chapter.

    (2) Confiscation of break-open tickets or confiscation of the revenues derived from the sale of those tickets, or both. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1207. Appeals

    Any licensee aggrieved by an action taken under subsection 1206(c) of this chapter and any person aggrieved by the Commissioner's refusal to issue or renew a license under this chapter may appeal in writing to the Commissioner for review of such action. The Commissioner shall thereafter grant a hearing subject to the provisions of 3 V.S.A. chapter 25 upon the matter and notify the aggrieved person in writing of his or her determination. The Commissioner's determination may be appealed within 30 days to the Washington Superior Court or the Superior Court of the county in which the taxpayer resides or has a place of business. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)

  • § 1208. Rulemaking

    The Department of Liquor Control may regulate the licensing and reporting requirements of manufacturers and distributors of break-open tickets under this chapter. The Commissioner of Liquor Control may adopt rules for licensure and indicia for boxes of break-open tickets, for record keeping relating to the distribution and sale of break-open tickets, and for the remittance of net proceeds from sales of break-open tickets to the intended eligible charitable recipients. The rules shall permit no proceeds to be retained by the operators of for-profit bars, except for:

    (1) the actual cost of the break-open tickets;

    (2) the prizes awarded; and

    (3) any sales tax due on the sale of break-open tickets under 32 V.S.A. chapter 233. (Added 2017, No. 73, § 13, eff. Sept. 1, 2017.)