The purpose of this rule making is to generate additional revenue for education in New York through operation of the new MONOPOLY Millionaires’ Club multi-state lottery game that will award prizes to ticket holders matching specified combinations of numbers randomly selected in regularly scheduled drawings.

The new section of the Gaming Commission regulations describes the MONOPOLY Millionaires’ Club as a multi-jurisdictional lottery game similar to the Powerball and the Mega Millions games that have been offered in New York and other states since 2002 and the Cash 4 Life game introduced in 2014. Subdivision (a) sets forth some definitions. Subdivision (b) governs ticket pricing and the terms and conditions of ticket sales. Subdivision (c) describes the game, including the primary and secondary drawings and additional game feature(s). The number of winners to be selected in a secondary drawing shall be not less than 10 and may increase based upon sales.

Subdivision (d) sets forth play characteristics and restrictions. Subdivision (e) describes the time and place of drawings. Subdivision (f) details the prize structure and probabilities of winning. Subdivision (g) describes the payment options that may be chosen by a winner. Subdivision (h) provides that Parts 5003 and 5004 govern this new game. Subdivision (i) states that this new section applies only to the new MONOPOLY Millionaires’ Club game.

The full text of this proposed rule is posted on the Commission’s website, www.gaming.ny.gov.

1. Statutory authority: The New York State Gaming Commission (“Commission”) is authorized to promulgate this rule by Tax Law Sections 1601, 1604, 1612(a) and 1617 and by Racing, Pari-Mutuel Wagering and Breeding Law (“Racing Law”) Sections 103(2) and 104(1, 19). Tax Law Section 1601 describes the purpose of the New York State Lottery for Education Law (Tax Law Article 34) as being to establish a lottery operated by the State, the net proceeds of which are applied exclusively to aid to education. Tax Law Section 1604 authorizes the promulgation of rules governing the establishment and operation of such lottery. Tax Law Section 1612(a) describes the distribution of revenues for a joint, multi-jurisdiction, and out-of-state lottery. Tax Law Section 1617 authorizes the Commission to enter into an agreement with a government-authorized group of one or more other jurisdictions for the operation and administration of such a joint, multi-jurisdiction and out-of-state lottery.

Racing Law Section 103(2) provides that the Commission is responsible to operate and administer the state lottery for education, as prescribed by Article 34 of the Tax Law. Racing Law Section 104(1) provides the Commission with general jurisdiction over all gaming activities within the State and over any person, corporation or association engaged in such activities. Section 104(19) of such law authorizes the Commission to promulgate any rules it deems necessary to carry out its responsibilities.

2. Legislative objectives: To permit the Commission to operate a new multi-jurisdiction lottery game that will raise revenue for education.

3. Needs and benefits. This rulemaking will permit the Commission to offer a new multi-jurisdiction lottery game to increase lottery revenue for education.

The proposed amendment will permit the Commission to offer Monopoly® Millionaires’ Club, a premium multi-state lottery draw game with an alternative jackpot prize structure that is expected to raise revenue for education by appealing to players with different preferences than players of existing lottery games offered by the Gaming Commission.

The Commission operates and administers joint, multi-jurisdiction, and out-of-state lottery games as a member of the Mega Millions and Powerball Consortia, a government-authorized group formed by an agreement of the Commission with state lotteries from other jurisdictions. Such Consortia take concepts for possible new games and subjects them to consumer research, and then develops new multi-jurisdiction lottery games of interest to one or more members of the Consortia. This allows jurisdictions in the Consortia to introduce new multi-jurisdiction lottery games that appeal to consumer interest and increase lottery sales and revenue.

Monopoly® Millionaires’ Club is a new multi-state draw game developed by the Consortia that is similar to successful multi-jurisdiction lottery games played in Europe and Canada. Drawings will occur once per week on Friday. For each $5 wager, a player in one of the participating states may have up to three chances to win: in the primary drawing; in a secondary drawing; and by collecting tickets associated with properties from the traditional MONOPOLY game board, combinations of which may earn chances for further prizes. The primary drawing may award a top prize with an annuitized value of $15 million to $25 million or lower-level prizes ranging from $5 to $100,000. Lump-sum prizes of $1 million will be awarded in secondary drawings only if a top prize-winning ticket has been sold for the primary drawing. In such an instance, a secondary drawing of numbers will occur. A ticket holder will win if the secondary number matches the unique transactional number printed on the holder’s ticket. The number of secondary winners selected at each drawing will be not less than 10 and may increase substantially, dependent upon sales. Players may also collect tickets with associated MONOPOLY properties and, depending upon the combination of properties, earn chances to win other prizes.

This game is expected to be successful because it is similar to popular lottery games offered in Europe and Canada and because MONOPOLY-themed instant lottery games and promotions typically attract a substantial following. Furthermore, market research has shown that players would like a game that creates multiple millionaires as an alternative to ones with an extremely large jackpot winner.

This proposal would authorize such lottery game in New York.

4. Costs:

a. Costs to regulated parties for the implementation and continuing compliance with the rule: There are no costs to stakeholders. Existing lottery agents will be able to sell these tickets the same as they do other lottery games.

b. Costs to the agency, the State, and local governments for the implementation and continuation of the rule: No additional operating costs are anticipated. The Commission can administer this game using existing resources.

c. Sources of cost evaluations: The foregoing cost evaluations are based on the Commission’s experience operating State Lottery games for more than 40 years.

5. Local government mandates: The proposed amendment does not impose any new programs, services, duties or responsibilities upon any country, city, town, village school district, fire district or other special district.

6. Paperwork: There are no changes in paperwork requirements. Lottery agents will be able to report the sales of this game using the same electronic reporting system.

7. Duplication: There are no relevant State programs or regulations that duplicate, overlap or conflict with the proposed amendment.

8. Alternatives: The alternative to amending these multi-jurisdictional regulations is to continue offering the games presently offered. This alternative was rejected because offering new games is proven to generate greater revenue for education by attracting the interest of players and providing them with another game choice.

9. Federal standards: The proposed amendment does not exceed any minimum standards imposed by the federal government.

10. Compliance schedule: The Commission believes that regulated persons will be able to achieve compliance with the rule upon adoption of this rule.

A regulatory flexibility analysis for small business and local governments, a rural area flexibility analysis, and a job impact statement are not required for this rule making because it will have no adverse effect on small businesses, local governments, rural areas, or jobs.

The rulemaking allows the Commission to offer customers a new play option, a multi-jurisdiction lottery game known as MONOPOLY Millionaires’ Club. This addition will impose no significant technological changes. No local government activity is involved. Lottery sales agents offer new or different lottery games only in order to increase sales. Customers are not required to play. There will be no new reporting, record keeping or other compliance requirements on small businesses or local governments or rural areas. The new lottery game will not adversely affect employment opportunities or jobs.

Based on the foregoing, no regulatory flexibility analysis for small businesses and local governments, rural area flexibility analysis, or a job impact statement is required for this proposed rulemaking.