Chapter 3770-4 Operating Standards for Sales Agents

3770-4-01 [Rescinded] Scope of regulations: director may provide management instructions.

Effective: 05/01/2014
R.C. 119.032 review dates: 02/10/2014
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
Prior Effective Dates: 7/15/94, 5/27/93, 2/13/04, 1/30/08

3770-4-02 Issuance of licenses, products and equipment.

(A) Authorization of sales agent. Each license issued to a sales agent authorizes that sales agent to conduct business at the address on the face of the license. A sales agent may not conduct lottery sales at other locations unless authorized by the director. A separate license shall be required for each location at which a sales agent is authorized to sell games. Games may not be sold at locations outside the state of Ohio.

(B) Licenses nontransferable. No license may be transferred to another person. If the control of a sales agent location changes, the new owner may apply to the director for a license pursuant to the rules and regulations set forth herein.

(C) Change of sales agent's location. If a sales agent moves from one location to another, games shall not be sold at the new location. The director may authorize transfer of the license to the sales agent's new location after considering all information concerning the sales agent's new location as required when making an initial application for a license at that location.

(D) Temporary and renewal of licenses. The director shall establish procedures for temporary licenses and renewal of licenses. Any temporary license shall expire on the expiration date shown on its face, which shall not be more than one year from the date of the temporary license is issued.

(E) Issuance of products and equipment. The director may issue products and equipment to sales agents through assigned sales representatives, courier or delivery services, or any other methods as determined by the director.

Five Year Review (FYR) Dates: 09/22/2014 and 02/24/2019
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , and 3770.08
Prior Effective Dates: 2/13/2004

3770-4-03 Sale of lottery tickets.

(A) Manner of sale. Games may be sold only by the sales agent or through the sales agent's employees. The sales agent must participate in the range of lottery games assigned to the sales agent, and agrees to use best efforts to sell those assigned lottery games. The director may prohibit sales agents from participating in or conducting any other schemes of chance or lottery games other than those games or promotions established by commission rule and provided for or encouraged by the director, or for which the sales agent is specially licensed by the state of Ohio. The director may prohibit sales agents from engaging in certain lottery promotions deemed by the director to be inappropriate. The director may set game sales quotas for each license. The director may initiate marketing and promotional programs and may provide sales agents with such materials as deemed appropriate.

(B) Game and equipment allocations. The quantity and types of games and equipment allocated to each sales agent will be determined by the director and may be based upon the license issued to that sales agent. If a agent sells out the allocation, additional games, if available, may be issued to the sales agent as approved by the director or an authorized representative of the director. The director may order that lottery games and equipment not be issued to a sales agent who has failed to clear an account of outstanding lottery games.

(C) Accessibility of lottery games. Each sales agent shall use best efforts to make lottery games easily accessible to the public and to encourage lottery sales.

(D) Prohibitions. Each sales agent shall always serve any customer in line before accepting any large block orders for lottery games. In this regard, sales agents may not accept mail orders, phone orders or bulk delivery of orders. Sales agents may not accept automated bet slips from any customers. Sales agents may accept original Ohio lottery bet slips that have been completed by hand.

Effective: 06/20/2009
R.C. 119.032 review dates: 02/24/2009 and 06/20/2014
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , and 3770.08
Prior Effective Dates: 7/15/74, 5/27/93, 12/27/96, 1/31/98, 2/13/2004

3770-4-04 Sale by director.

(A) Sales. The director or an authorized representative may sell games.

R.C. 119.032 review dates: 05/19/2014 and 02/24/2019
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
Prior Effective Dates: 7/74, 5/93, 12/96, 2/04, 5/09

3770-4-05 Sales representatives.

(A) Sales representative duties. The director shall specify periodic dates on which sales representatives shall be required to appear at their assigned sales agent locations. Sales representatives shall be responsible for delivery of paper products, point of purchase materials and any other items designated by the director, as well as the occasional movement of tickets. Sales representatives shall also be responsible for taking inventory of games and completing an instant inventory summary at each retail location. They shall further be responsible for retrieving unsold tickets, and for obtaining an accounting for stolen or destroyed tickets in the manner prescribed by the director.

(B) Obligations of sales representatives.

(1) Each sales representative shall maintain records of custodial and safekeeping activities as required by the director.

(C) Detailed procedures. Consistent with these rules, the director shall establish detailed operating procedures for sales representatives.

Effective: 08/29/2014
R.C. 119.032 review dates: 05/19/2014 and 02/24/2019
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
Prior Effective Dates: 7/15/74, 5/27/93, 12/27/96, 2/13/04

3770-4-06 Return and settlement of tickets and collection of lottery sales revenues.

(A) Ticket settlement cycles. The sales agent is solely responsible for the safety and security of all tickets issued to the agent. The sales agent must account for such tickets and transfer the proceeds from their sale, less authorized deductions, to the lottery by means of procedures established by the director for the deposits of proceeds from game sales. Upon the closing of a game, unsold full books of lottery tickets, must be returned to the lottery for the purpose of settlement, on the dates and in the manner set out in these regulations or in the management regulations and directives of the director. Any tickets that are not returned or properly accounted for on the specified date will be deemed to have been sold by the sales agent. The director may decide not to issue subsequent books of tickets to a sales agent who has not fully accounted for tickets previously issued.

(B) Management directives. The director will, in management regulations or directives, prescribe the forms for sales agents to use in all lottery transactions.

(C) Consignment property. Lottery games are issued to a sales agent on a consignment basis and remain the property of the state of Ohio. All equipment and supplies provided to a sales agent by the lottery remain the property of the state of Ohio.

(D) Director's authority to collect lottery sales revenues.

(1) The director shall collect the revenues received from the sale of games by sales agents at intervals established by the director. The director shall designate a day or days during any interval time period on which sales agents shall be required to deposit to the credit of the lottery fund, in accounts which shall be used exclusively for lottery-related transactions at lawfully designated banking institutions, all moneys due the lottery by such sales agents from the sale of games, less an amount retained as compensation for sale of such games. The director may further order that sales agents deduct the amounts they pay in authorized prize payments and any commissions or bonuses to which agents are entitled from the amounts received in gross game sales prior to their deposit in accounts.

(2) The director may arrange for any banking institution to perform the functions and services necessary to collect the revenues received from the sales of lottery games by sales agents, and may arrange the compensation for such performance as deemed necessary and advisable. The director may also rely on the treasurer of state to perform this function. The director shall establish detailed record keeping and operating procedures to be followed by such banking institutions to carry out the purposes of the Lottery Act and these rules.

(E) Penalties for non-transfer of funds. The director may impose penalties for the failure of a sales agent to transfer funds to the lottery in a timely manner. Penalties may include, but are not limited to; monetary penalties, modification of license, immediate suspension, or revocation. The director may adopt internal management regulations elaborating on any terms regarding the collection of sales revenues from the sales agents.

Eff 9-11-78; 5-27-93; 12-27-96; 5-4-00; 3-23-03; 2-13-04
Rule promulgated under: RC 119.03
Rule authorized by: RC 3770.03
Rule amplifies: RC 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
R.C. 119.032 review dates: 02/24/2009 and 02/24/2014

3770-4-07 Stolen and destroyed tickets.

A sales agent is financially responsible for all tickets consigned to that sales agent's location. If tickets are stolen or destroyed, the sales agent shall report that fact to the director within the time set forth in any internal management regulations established by the director. In the case of stolen tickets, the sales agent is also required to file a report with the local or state police, or in the case of tickets destroyed by fire, a report must be filed with the local fire department. Upon such notification to the director, and provided that the sales agent files a notarized affidavit with the commission stating the facts of the case, the director shall provide the sales agent with a supplementary delivery of tickets in the manner set forth in these regulations or in internal management regulations and directives of the director. The sales agent is subsequently required to file any official police or fire report for stolen or destroyed tickets with the director within the time set forth in any internal management regulations established by the director. The sales agent shall not be required to pay for the stolen or destroyed tickets until so notified by the director, but shall remain liable to pay the sale price less any authorized deductions for such tickets unless, upon investigation by the director, the director determines and notifies the sales agent that the sales agent shall be relieved of the obligation to pay for some or all of such tickets. The director may adopt internal management regulations elaborating the stolen or destroyed ticket policy, and the circumstances under which credit will be given, or under which the sales agent will be relieved of the obligation to pay, for stolen or destroyed tickets.

Effective: 06/27/2014
R.C. 119.032 review dates: 03/24/2014 and 01/30/2018
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
Prior Effective Dates: 9/11/1978, 5/27/1993, 12/27/1996, 1/31/1998, 10/5/2000, 2/13/2004

3770-4-08 Payment of minor prizes.

Each sales agent shall agree to pay, out of the proceeds from the sale of lottery games, prizes up to and including five hundred ninety-nine dollars when so required by the director, upon validation of winning games in accordance with validation procedures adopted by the director. A sales agent will be liable for any prizes paid on improperly validated games. The holder of a winning game may obtain payment of any prize amount from six hundred dollars through five thousand dollars by way of a bank cashing program at any participating bank or by any other cashing method established by the director in compliance with rule 3770:1-8-04 of the Administrative Code concerning payment of prize awards.

Effective: 06/27/2014
R.C. 119.032 review dates: 03/24/2014 and 01/30/2018
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
Prior Effective Dates: 9/10/79, 5/27/93, 1/31/98, 2/13/04

3770-4-09 Compensation and reimbursement of expenses to be paid licensed lottery sales agents.

(A) Commission. Except as otherwise provided in paragraph (B) of this rule, each sales agent shall receive a commission based upon the sales agent's gross game sales at the rate specified by the director for each license. The director shall establish procedures for the prompt payment to each sales agent of their sales commission and cashing bonus. In addition, the director may from time to time establish incentive and bonus awards for sales agents for promotional purposes. Incentive and bonus awards may include increased sales commissions, cash awards, trips, merchandise or any other award at the discretion of the director.

(B) For sales of all "EZPlay Tap" games offered on the "Coronis Multi-Purpose Next Generation" terminal, each sales agent shall receive a commission based upon net game sales. Net game sales as used herein means sales after deduction of applicable vendor fees and winner pay outs at the rate specified by the director.

(C) Reimbursement of expense. The director shall establish procedures for the prompt reimbursement of all expenses properly incurred by a sales agent as authorized by the director.

Effective: 07/31/2014
R.C. 119.032 review dates: 04/21/2014 and 06/20/2019
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , 3770.08
Prior Effective Dates: 7/15/74, 5/27/93, 1/31/98, 2/13/04, 6/20/09

3770-4-10 Records and audits; and inspection of sales agent premises.

(A) The auditor of state and the director or an authorized representative may periodically examine all records, files and other documents of the sales agent as they pertain to the sales agent's activities for purposes of conducting authorized audits. Each sales agent shall maintain such records complete and up to date.

(B) A sales agent shall allow inspections of the licensed premises at any time upon the request of inspectors authorized by the director. The inspection may be made without prior notice to the sales agent.

R.C. 119.032 review dates: 07/21/2014 and 02/24/2019
Promulgated Under: 119.03
Statutory Authority: 3770.03
Rule Amplifies: 3770.01 , 3770.02 , 3770.03 , 3770.04 , 3770.05 , 3770.06 , 3770.07 , and 3770.08
Prior Effective Dates: 2/13/2004

3770-4-11 Inspection of agent premises. [Rescinded].

Rescinded eff 2-13-04