DEPARTMENT OF TREASURY
MICHIGAN GAMING CONTROL BOARD
CASINO GAMING

Filed with the secretary of state on

These rules become effective immediately after filing with the secretary of state unless adopted under section 33, 44, or 45a(9) of the administrative procedures act of 1969, 1969 PA 306, MCL 24.233, 24.244, or 24.245a. Rules adopted under these sections become effective 7 days after filing with the secretary of state.

(By authority conferred on the Michigan gaming control board by section 4 of the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.204)

R 432.1101, R 432.1103, R 432.1104, R 432.1106, R 432.1107, R 432.1108, R 432.1212, R 432.1214, R 432.1216, R 432.1217, R 432.1218, R 432.1220, R 432.1221, R 432.1223, R 432.1232, R 432.1301, R 432.1303, R 432.1304, R 432.1307, R 432.1308, R 432.1309, R 432.1321, R 432.1322, R 432.1327, R 432.1338, R 432.1341, R 432.1501, R 432.1504, R 432.1505, R 432.1507, R 432.1601, R 432.1702, R 432.1811, R 432.1839, R 432.1840, R 432.1841, R 432.11008, R 432.11201, R 432.11203, R 432.11204, and R 432.11602 of the Michigan Administrative Code are amended, and R 432.1206, R 432.1222, R 432.1310, and R 432.1313 are rescinded, as follows:

PART 1.  DEFINITIONS

R 432.1101  Definitions; A to C.
  Rule 101. As used in these rules:

   (a) "Act" means the Michigan gGaming cControl and rRevenue aAct, 1996 IL 1, MCL 432.201 to 432.226.

   (b) "Application" means all materials and information comprising the applicant's request for a casino license, supplier's license, or occupational license submitted by the applicant to the board, including, but not limited to, the instructions, forms, and other documents required by the board for purposes of application for a license under the act and these rules.

   (c) "Associated equipment" means any of the following:

   (i) Any equipment which that is a mechanical, electromechanical, or electronic contrivance, component, or machine and which is used indirectly or directly in connection with gaming.

   (ii) Any equipment that would not otherwise be classified as a gaming device, including, but not limited to, links, modems, and dedicated telecommunication lines, that connects to progressive electronic gaming devices.

   (iii) Computerized systems that monitor electronic gaming devices, table games, and other gambling games approved by the board.

   (iv) Equipment that affects the proper reporting of gross receipts.

   (v) Devices for weighing and counting money.

   (vi) Any other Other equipment that the board determines requires approval as associated equipment to protect the integrity of gaming and ensure compliance with the act and these rules.

 (d) "Attributed interest" means any direct or indirect interest in a business entity deemed by the board to be held by an individual through holdings of the individual's immediate family or other persons and not through the individual's actual holdings.

   (d) "Bill validator" means an electromechanical device attached either on or into an electronic gaming device for the purpose of dispensing an amount of credits equal to the amount of cash or cash equivalency inserted into the bill validator.

  (f) "Board" means the Michigan gaming control board

   (eg) "Board surveillance room" means dedicated office space in each casino for the exclusive use of the board for the monitoring and recording of gaming or other any other activities.

   (fh) "Cash" means United States currency and coin or foreign currency and coin that has been exchanged for its equivalent United States currency and coin value.

   (gi) "Cash equivalent" means an asset that is readily convertible to cash, including, but not limited to, any of the following:

   (i) Traveler’s checks.

   (ii) Certified checks, cashier's checks, and money orders.

   (iii) Personal checks or drafts.

   (iv) Credit extended by the casino licensee, a recognized credit card company, or banking institution.

   (v) Any other Other instruments that the board deems determines have a cash equivalent.

Other than recognized credit cards or credit extended by the casino licensee, all instruments that constitute a cash equivalent shall must be made payable to the casino licensee, bearer, or cash. If an instrument is made payable to a third party, then the instrument is not a cash equivalent.

   (hj) "Casino critical computerized systems" means 1 or more computer systems that which are approved by the board and which meet all of the following requirements:

   (i) Are connected to all electronic gaming devices in the casino to record and contemporaneously monitor the play and cash flow and security of each electronic gaming device.

   (ii) Are capable of monitoring the activities of the live gaming devices, including, but not limited to, any of the following or their equivalents:

   (A) Table fills.

   (B) Table credits.

   (C) Table gaming receipts, disbursements, and revenues.

   (iii) Are capable of tracking the activities of the live gaming devices, including, but not limited to, either of the following or their equivalents:

   (A) Table game inventories.

   (B) Employee gratuity receipts and disbursement accounting.

   (iv) Are capable of monitoring the activities of the main bank and all cages, including, but not limited to, either of the following or their equivalents:

   (A) Manual payouts.

   (B) Table credits and fills.

   (v) Are capable of tracking the activities of the main bank and all cages, including, but not limited to, any of the following or their equivalents:

   (A) Receipt and record of soft count.

   (B) Record of gaming receipts, disbursements, and revenues.

   (C) Cashier checkout.

   (D) Main bank and cage inventory.

   (E) Deposits.

   (F) Cash transaction reports.

   (G) Patron credit.

   (vi) Are capable of monitoring the casino licensee's casino accounting package.

    (vii) Are linked by dedicated telecommunication lines to board-designated computer terminals located in board offices on and off the casino premises. The terminals must shall be able to access, receive, and display the information required and prescribed by the board.

(ik) "Casino license" means a license issued by the board to a person to own or operate a casino in this state under the act.

   (jl) "Casino operations" means operations of a casino or a casino enterprise other than gambling operations, including, but not limited to, the purveying of food, beverages, retail goods and services, and transportation.

   (km) "Casino surveillance room" means a room or rooms at each casino for monitoring and recording casino operations and gambling operations by the casino licensee.

   (ln) "Certificate of suitability" means a written document issued by the board certifying that an applicant has been chosen for licensure if the applicant meets all of the following:

   (i) The conditions of a certified development agreement with a city.

   (ii) The conditions set forth by the board in the certificate of suitability and the requirements of the act and these rules.

   (mo) "Chip" means a representation of value redeemable for cash only at the issuing casino and issued by a casino licensee for use in gaming, other than in electronic gaming devices.

(np) "Contest" means a gambling game which that is offered and sponsored by a gambling operation in which where patrons of the gambling operation are assessed an entry fee to play the game or games and in which where winning patrons receive a portion of or all of the entry fees that may be increased with cash and noncash prizes from the gambling operation.

   (oq) "Counterfeit chips" means chip-like objects that have not been approved under these rules, including objects commonly referred to as slugs, but not including legal coins of the United States or any other other nations.

   (pr) "Count room" means the room or rooms designated for the counting, wrapping, and recording of a casino licensee's gaming receipts.

R 432.1103  Definitions; G to I.

  Rule 103. As used in these rules:

   (a) “Gaming area” means the room or rooms in a casino in which where gaming is conducted.

   (b) “Gaming equipment or supplies” means a machine, mechanism, device, piece of equipment, item, or implement which is integral to the operation of a game or that affects the result of a gambling game by determining a win or loss, including, without limitation:, electronic, electrical, or mechanical devices or machines; cards or dice; layouts for live table games; any representative of value used with any game, including without limitation chips, tokens, or electronic cards; voucher systems; voucher printers; voucher validation terminals; computer monitoring systems; and hardware and software related to any item described in this part any of the following:.

(i) EGDs.

  (ii) Software.

  (iii) Cards.

  (iv) Dice.

Layouts for live table games and any representatives of value, including, without limitation, chips, or electronic cards and related hardware and software do not affect the result of a game, but are gaming equipment and supplies.

   (c) “Gaming operations manager” means an individual person who has the ultimate responsibility to manage, direct, or administer the conduct of the gambling operation in a casino licensed under the act and these rules.

   (d) “Hand” means either 1 game in a series, 1 deal in a card game, or the cards held by a player.

   (e) “Hearing officer” means the board member or the administrative hearing officer designated to conduct a hearing on any matter within the jurisdiction of the board.

   (f) “Holding company” means any person, other than an individual, that meets both of the following criteria:

    (i) Directly or indirectly owns, has the power or right to vote or control, or holds with the power to vote more than 5% of the stock, equity interest, or other voting security of a person that holds, or has applied for, a casino license or a supplier's license.

    (ii) Directly or indirectly holds, or substantially owns, any power, right, or security through any interest in a subsidiary or successive subsidiary, regardless of how many subsidiaries may intervene between the holding company and the holder or applicant for, or holder of, casino license or a supplier's license.

   (g) “Immediate family” means any of the following, whether by whole or half blood, marriage, adoption, or effect of law:

   (i) Spouse, other than a spouse who is legally separated from the individual under a decree of divorce or separate maintenance.

(ii) Parent.

   (iii) Child.

   (iv) Dependent.

   (v) Sibling.

   (vi) Spouse of sibling.

   (vii) Father-in-law.

   (viii) Mother-in-law.

   (h) “Indirect interest” means an interest, claim, right, legal share, or other financial stake in a person that is deemed determined by the board to exist by virtue of a financial or other interest in another person.

   (i) “Individual” means any natural person.

   (j) “Interim compliance period” means the time period of time between the issuance of a certificate of suitability and the issuance of a casino license or board order denying a casino license the issuance of a notice of denial.

   (k) “Intermediary company” means any corporation, firm, partnership, trust, limited liability company, or other form of business entity that meets one 1 of the following criteria:

   (i) Is a holding company of a person that has applied for or holds a casino license or supplier license.

   (ii) Is a subsidiary of any holding company of a person that has applied for or holds a casino license or supplier license.

   (l) “Internal control system” means the internal procedures, administration, and accounting controls designed by the casino licensee for the purpose of exercising control over the gambling operation and its assets.

   (m) “Irrevocable letter of credit” means an engagement by a banking institution which that is issued, held, and negotiated under the publication entitled “Uniform Customs and Practice for Documentary Credits,” 2007 revision, International Chamber of Commerce publication no. 600, as amended, or “International Standby Practices ISP 98,” International Chamber of Commerce publication no. 590 (1999), as amended, at the request of a casino licensee, and under which the banking institution will shall honor demands for payment upon compliance with the conditions specified until the expiration date on the letter of credit.

R 432.1104  Definitions; J to L.
  Rule 104. As used in these rules:

(a) "Junket" means an arrangement to induce persons who are selected or approved for participation on the basis of their ability to satisfy a financial qualification obligation related to their ability or willingness to come to a licensed casino for the purpose of gambling and who receive as consideration all or part of the cost of transportation, food, lodging, or entertainment directly or indirectly paid by a casino licensee or agent.

(b) "Junket representative" means a person, other than a casino licensee or casino license applicant, who receives payment for the referral, procurement, or selection of persons who may participate in a junket to a licensed casino in this state, based upon the person's actual or calculated potential to wager or lose, regardless of whether the activities of the junket representative occur within this state.

   (ac) "Key person" means any of the following entities:

   (i) An officer, A director of an applicant for, or holder of, a casino license or supplier license. , trustee, partner, or proprietor of a person that has applied for or holds a casino license or supplier license or an affiliate. or holding company that has control of a person that has applied for or holds a casino license or supplier license.

(ii) A managerial employee of an applicant for, or holder of, a casino license or supplier license that performs the function of principal executive officer, principal operations officer, or principal accounting officer. person that holds a combined direct, indirect, or attributed debt or equity interest of more than 5% in a person that has applied for or holds a casino license or supplier license.

   (iii) A person that holds a combined direct, indirect, or attributed equity interest of more than 5% direct or indirect interest in an applicant for, or holder of, a casino license or supplier license. in a person that has a controlling interest in a person that has applied for or holds a casino license or supplier license.

(iv) A qualifying business of the applicant. managerial employee of a person that has applied for or holds a casino license or supplier license in this state, or a managerial employee of an affiliate or holding company that has control of a person that has applied for or holds a casino license or supplier license in this state, who performs the function of principal executive officer, principal operating officer, principal accounting officer, or an equivalent officer.

    (v) A director of a qualifying business of an applicant for, or holder of, a casino or supplier license. managerial employee of a person that has applied for or holds a casino license or supplier license, or a managerial employee of an affiliate or holding company that has control of a person that has applied for or holds a casino license or supplier license, who will perform or performs the function of gaming operations manager, or will exercise or exercises management, supervisory, or policy-making authority over the proposed or existing gambling operation, casino operation, or supplier business operations in this state and who is not otherwise subject to occupational licensing in this state.

    (vi) A managerial employee of a qualifying business of an applicant for, or holder of, a casino license or supplier license that performs the function of principal executive officer, principal operations officer, or principal accounting officer. An institutional investor is not a key person unless it has a controlling interest or fails to meet the standards of section 6c(1) of the act, MCL 432.206c, for waiver of eligibility and suitability requirements for qualification and licensure under the act and these rules.

(bd) "Licensee" means a person who holds a license under the act.

   (ce) "Live game" means a gambling game which that does not involve an EGD and which is played with a live gaming device.

   (df) “Live gaming device” means any fully assembled nonelectrical or non-electromechanical apparatus used to gamble upon, including, but not limited to, any of the following:

   (i) Roulette wheel and table.

   (ii) Blackjack table.

   (iii) Craps table.

   (iv) Poker table.

 (v) Table layout.

R 432.1106  Definitions; P to R.

  Rule 106. As used in these rules:

   (a) "Par sheet" means a document which that is provided by the EGD manufacturer and which depicts all of the following:

    (i) The possible outcomes from the play of an EGD.

(ii) The probability of occurrence of the outcomes.

(iii) The contribution of each winning outcome to the payback percentage of the EGD.

   (b) "Patron dispute" means a dispute a patron has regarding winnings or losses or the conduct of gambling at a casino.

   (c) "Payout" means the winnings that result from a wager.

   (d) "Petitioner" means a person who that files a petition under part 7 of these rules.

   (e) "Picture identification" means a valid driver license, state identification card, student identification card, military identification card, passport, or any another bona fide picture identification that establishes the identity and age of the individual.

   (f) "Pit" means the area enclosed or encircled by the arrangement of the gaming tables in which where casino gambling personnel administer and supervise the live games played at the tables by patrons located outside the perimeter of the area.

   (g) "Progressive controller" means the hardware and software that controls all communication among the EGDs or live gaming devices within a progressive EGD link or a progressive live gaming device link and its associated progressive meter.

   (h) "Progressive jackpot" means a value determined by application of an approved formula to the income of independent, local, or interlinked EGDs or live gaming devices.

   (i) "Public offering" means a sale of securities that is subject to the registration requirements of section 5 of the securities act of 1933, 15 USC 77e(c), or that is exempt from the registration requirements solely by reason of an exemption contained in either of the following provisions:

   (i) Section 3(a)(10), (a)(11), or (c) of the securities act of 1933, 15 USC 77c(a)(10), (a)(11), or (c), as amended.

   (ii) Regulation A or Regulation D adopted under section 3(b) of the securities act of 1933, 15 USC 77c(b), 17 CFR 230.251 to 230.263, and 230.500 to 230.508, as amended.

   (j) "Publicly held company" or "publicly traded corporation" means any of the following:

   (i) A person, other than an individual, to which either of the following provisions applies:

   (A) The person has 1 or more classes of voting securities registered under section 12 of the securities exchange act of 1934, 15 USC 78l, as amended.

   (B) The person issues securities and is subject to section 15(d) of the securities exchange act of 1934, 15 USC 78o(d), as amended.

    (ii) This Either term also means another person, other than an individual, required to file under the securities exchange act of 1934, 15 USC 78a to 78qq. It also includes any person, other than an individual, that has securities registered or is an issuer under this definition solely because it guaranteed a security issued by an affiliate under a public offering and is considered by the Securities and Exchange Commission to be an underwriter of a public offering under section 2(a)(11) of the securities act of 1933, 15 USC 77b(a)(11), and 17 CFR 230.140, as amended.

   (iii) A person, other than an individual, created under the laws of a foreign country to which both of the following provisions apply:

   (A) The person has 1 or more classes of voting securities registered on the foreign country's securities exchange or over-the-counter market.

   (B) The board has determined that the person's activities are regulated in a manner that protects the investors and this state.

Either term includes any person, other than an individual, that has securities registered or is an issuer under this definition solely because it guaranteed a security issued by an affiliate under a public offering and is considered by the Securities and Exchange Commission to be an underwriter of a public offering under section 2(a)(11) of the securities act of 1933, 15 USC 77b(a)(11), and 17 CFR 230.140, as amended.

   (ivii) A person, other than an individual, that has shares which that are traded on an established securities market or traded on a secondary market.

(k) “Qualifying business” means any of the following:

    (i) A person, that is not an individual, that directly or indirectly controls an applicant for, or holder of, a casino or supplier license.

    (ii) A person, that is not an individual, that directly or indirectly holds more than 5% direct or indirect ownership interest in an applicant for, or holder of, a casino or supplier license.

    (iii) A person, that is not an individual, that has ownership common to the ownership of an applicant or licensee, that provides a material aspect of the goods or services that an  applicant or licensee provides or plan to provide in this state.

(lk) "Random access memory" or “RAM” means the electronic component used for computer work space and storage of volatile information in an EGD.

   (lm) "Randomness" means the unpredictability and absence of patterns in the outcome of an event or sequence of events.

   (mn) "Random number generator" or “RNG” means hardware, software, or a combination of hardware and software devices for generating number values that exhibit the characteristics of randomness.

   (ro) "Read only memory" or “ROM” means the electronic component used for storage of nonvolatile information in an EGD, including programmable ROM and erasable programmable ROM.

   (np) "Registered agent" means an individual designated to accept service of legal process on behalf of another person.

   (oq) "Related party" means 1 of the following:

(i) An individual or business entity that has a pecuniary interest in a casino licensee, a casino license applicant, or an affiliate thereof, if the casino licensee, casino license applicant, or affiliate is not a publicly held company.

(i) A holder of more than 5% of the outstanding shares of a casino licensee, a casino license applicant, or an affiliate thereof, if the casino licensee, casino license applicant, or affiliate is a publicly held company.

  (i) A key person of a casino licensee, a casino license applicant, or an affiliate of a casino licensee or a casino license applicant.

(ii) An affiliate of a casino licensee or a casino license applicant.

(iii) An immediate family member of a holder of more than 5% of the outstanding shares of a casino licensee, a casino license applicant, or an affiliate of a casino licensee or a casino license applicant.

    (ii) AAn immediate family member relative of a key person of a casino licensee, a casino license applicant, or an affiliate of a casino licensee or a casino license applicant.

(iv) A relative of an affiliate of a casino licensee or a casino license applicant.

(i) A trust for the benefit of, or managed, by a casino licensee, a casino license applicant, or an affiliate or a key person of a casino licensee or a casino license applicant.

(v) Any other person who is able to significantly influence the management or operating policies of a casino licensee, a casino license applicant, or an affiliate of a casino licensee or a casino license applicant.

(vi) An institutional investor that has a controlling interest in a person that has applied for or holds a casino license or supplier license or that fails to meet the standards set forth in section 6c(1) of the act, MCL 432.206c, for waiver of the eligibility and suitability requirements for licensure under the act and these rules. An institutional investor is not considered to be a related party unless it fails to meet the standard set forth in section 6c(1) of the act, MCL 432.206c, for waiver of the eligibility and suitability requirements for licensure.

   (pr) "Related party transactions" means transactions between a casino licensee or a casino license applicant and a related party.at least 1 of the following:A related party.

(i) An immediate family member.

A dependent.

(q) "Relative" means any of the following entities whether by whole or half blood, marriage, adoption, or natural relationship:

  (i) Spouse, other than a spouse who is legally separated from the individual under a decree of divorce or separate maintenance.

  (ii) Parent.

(iii) Grandparent.

(iv) Child.

(v) Grandchild.

(vi) Sibling.

(vii) Uncle.

(viii) Aunt.

(ix) Nephew.

(x) Niece.

(xi) First cousin.

(xii) Father-in-law.

(xiii) Mother-in-law.

(xiv) Son-in-law.

(xv) Daughter-in-law.

(xvi) Brother-in-law.

(xvii) Sister-in-law.

(xviii) Dependent.

   (s) "Respondent" means a person against whom a seizure, forfeiture, or disciplinary action has been initiated.

R 432.1107 Definitions; S to U.

  Rule 107. As used in these rules:

   (a) “Slot machine” means a type of EGD.

   (b) "Slug" means a disk or object which that is not issued by the casino licensee and which does not have a cash value.

   (c) "Sole proprietorship" means an individual who owns 100% of the assets and who is principally liable for the debts of a business, regardless of whether another person guarantees payment of such the debts.

   (d) "Standard chi-squared analysis" means the sum of the squares of the difference between the expected result and the observed result.

   (e) "Subsidiary" means a person, other than an individual, including, without limitation, a firm, partnership, trust, limited liability company, or other form of business organization where in which an equity interest is owned, subject to a power or right of control, or held with the power to vote directly, indirectly, or in conjunction with a holding company or intermediary company.

   (f) "Substantial owner" means the holder of any of the following:

   (i) More than 5% of the total combined voting power of a corporation or more than 5% of the total value of shares of all classes of stock of a corporation.

   (ii) More than a 5% interest in a partnership.

    (iii) More than 5% of the value of a trust computed actuarially.

(iv) More than 5% of the legal or beneficial interest in any other another person. For purposes of computing the percentages in this subdivision, a holder will be is determined deemed to own any stock or other interest in a person, whether owned directly, indirectly, or attributed. The term "substantial owner" does not include an institutional investor, unless the institutional investor has more than a 5% interest in the applicant or licensee and fails to meet the standards set forth in section 6c(1) of the act, MCL 432.206c, for waiver of the eligibility and suitability requirements for licensure under the act and these rules.

  (g) "Supplier" means a person who the board has identified under rules promulgated by the board as requiring a license to provide casino licensees or casino enterprises with goods or services regarding the realty, construction, maintenance, or business of a proposed or existing casino, casino enterprise, or related facility, including, but not limited to any of the following:

(i)Junket enterprises.

(ii)Security businesses.

(iii)Manufacturers of gaming devices or equipment.

(iv)Distributors.

(v)Persons who service gaming devices or equipment.

(vi)Garbage haulers.

(vii)Maintenance companies.

(viii)Food purveyors.

(ix)Construction companies.

(h) "Surety bond" means a contractual arrangement between the surety, the principal, and the obligee that the surety agrees to protect the obligee if the principal defaults in performing the principal's contractual obligation. The bond is the instrument that binds the surety.

   (gi) "Table drop" means the total dollar amount of United States and foreign currency, chips, tickets, markers, or credits contained in the drop box of a live gaming device.

   (hj) "Table win" means the dollar amount which that is won by the casino licensee through play at a live game and which is the total of the table drop, plus ending chip inventory, minus opening chip inventory, plus chip credits, minus fills.

   (ik) "Theoretical payout percentage" means the sum of the number of cash equivalents or credits expected to be paid as a result of the jackpots divided by the number of different possible outcomes.

   (jl) “Ticket” means a representation of value stated on a coded paper instrument that is redeemable for the equivalent value in cash only at the issuing casino and is issued by a casino licensee for use in gaming.

   (km) "Tilt condition" means a programmed error state for an EGD that occurs when the EGD detects an internal error malfunction or attempted cheating. The EGD ceases processing further input, output, or display information other than that indicating the tilt condition itself.

R 432.1108 Definitions; V to Z.
  Rule 108. As used in these rules:

   (a) "Value chip" means a chip that is clearly and permanently impressed, engraved, or imprinted with the name of the casino and the specific value of the chip.

   (b) "Voting security" means a security that the holder is entitled to may vote generally for the election of a member or members of the board of directors or board of trustees of a corporation or a comparable person or persons in the case of a partnership, trust, or another form of business organization other than a corporation.

   (c) "Wager" means an item that is representative of value risked on a gambling game authorized under the act and these rules.

(d) “Wide-area Wide area progressive system” means a system of EGDs that is approved by the board and is linked as part of a network connecting one or more casinos licensed by the board and that has an aggregate prize or prizes.

   (e) “Wide area progressive central system” means the computer hardware, network equipment, and software applications responsible for calculation of the prize values, data security, event monitoring, reporting, wagering activity, and communication of EGDs that are linked at one or more casinos and contribute to an aggregate prize or prizes.

R 432.1206  Duty to disclose changes in information. Rescinded.

 Rule 206. (1) Except as otherwise provided in these rules, if an obligation has been placed upon a licensee to report or submit information to the board, the reporting or submission may be accomplished by providing the information to an employee of the board or a member of the Michigan state police assigned to assist the board.

 (2) A licensee or an applicant for a license has a continuing duty to disclose promptly any material changes in information provided to the board as soon as the applicant or licensee becomes aware of the change. The duty to disclose changes in information continues throughout any period of licensure granted by the board. A licensee or applicant shall make sure that all required release of information forms submitted to the board are current.

R 432.1212 Weapons in casino.

  Rule 212. (1) An individual may not carry a firearm or other weapon in a casino,

  except if the individual is for any of the following:

   (a) State, county, city, township, or village law enforcement officers, as that term is defined in section 2(f) of the Michigan commission on law enforcement standards act, 1965 PA 203, MCL 28.602.

   (b) Federal law enforcement officers, as that term is defined in 5 USC 8331.

   (c) Armored car personnel picking up or delivering currency in any area of the casino. at secured areas.

   (d) Retired police officers, law enforcement officers, or federal law enforcement officers who hold a license to carry a concealed pistol under 1927 PA 372, MCL 28.421 to 28.435, as referenced in section 5o(5)(a) of 1927 PA 372, MCL 28.425o.

   (e) Retired law enforcement officers who are certified to carry a concealed firearm under the Michigan retired law enforcement officer's firearm carry act, 2008 PA 537, MCL 28.511 to 28.527.

   (f) Casino security personnel licensed to carry a concealed pistol under 1927 PA 372, MCL 28.421 to 28.435, while on duty and only as permitted allowed by the casino licensee.

  (2) Law enforcement officers conducting official duties within a casino shall, to the extent practicable, advise the Michigan state police gaming section of their presence.

  (3) Private casino security personnel may carry handcuffs while on duty in a casino.

R 432.1214 Authority of executive director; authority.

  Rule 214. The board delegates to its executive director all power and authority to act in the name of the board with respect to all reasonable, necessary, and appropriate actions to administer and carry out the administrative and executive functions of the board, including, but not limited to, the power to do any of the following:

   (a) Execute and enter into contracts on behalf of the board.

   (b) Incur reasonable and necessary expenses in the name of the board in the manner provided by law.

   (c) Take and hold property on behalf of the board.

   (d) Hire and fire employees of the board.

   (e) Issue subpoenas for the attendance of witnesses.

   (f) Administer oaths.

   (g) Issue and renew temporary occupational and supplier licenses.

   (h) Request and accept documents, plans, procedures, amendments to procedures, and other information necessary for the board to carry out its duties under the act and these rules.

   (i) Conduct investigations, inspections, audits, share information with law enforcement agencies and the city, and engage in other functions necessary to ensure the proper administration and enforcement of the act and these rules.

   (j) Grant requests and waivers, answer inquiries, issue interpretations, and otherwise take any action that is reasonably requested by applicants, licensees, and holders of certificates of suitability in furtherance of, and consistent with, the efficient administration and enforcement of the provisions of the act and these rules, as determined to be necessary or appropriate by the executive director.

R 432.1216 Contract requirements.

  Rule 216. (1) A contract or transaction entered into by a casino licensee or a casino license applicant that is more than $5100,000.00 shall must be a written contract.

  (2) The board may direct a casino licensee or casino license applicant to cancel any contract or transaction that the board determines does not comply with the act and this part.

  (3) A contract entered into by a casino licensee or casino license applicant shall must contain a provision permitting allow the casino licensee or casino license applicant to terminate the contract if the board determines that the contract does not comply with the act or these rules.

R 432.1217 Normal purchasing transactions.

  Rule 217. (1) A casino licensee or casino license applicant shall submit, for

approval by the board, an internal control procedure regarding purchasing transactions.

  (2) The internal control procedure shall must include a statement of policy regarding ethical standards and compliance with state and federal laws. The statement must shall prohibit purchasing and contracting personnel from accepting gifts and gratuities from suppliers of goods or services, except in accordance with a written policy submitted with the internal control procedures.

  (3) The internal control procedures submitted shall must include, but not be limited to, all of the following information:

   (a) The manner in which that purchase requisitions will be issued.

   (b) The amounts that can be authorized by various positions or level of personnel.

   (c) Requirements for the competitive bidding process, including the number of bids required.

   (d) Procedures for issuing and approving blanket purchase orders.

   (e) Procedures and approval regarding emergency purchases.

   (f) Criteria for qualifying approved vendors of goods or services based on the following such factors as the following:

(i) Quality of the product or service to be provided.

 (ii) Suitability of the vendor of the goods or services.

 (iii) Price.

 (iv) Any other Other criteria the board deems determines necessary to ensure compliance with the act and this rule.

   (g) Documentation that goods or services acquired were obtained on the basis based off of a price that is commercially reasonable considering the criteria set forth in subdivision (f) of this subrule.

   (h) Procedures and approval process for the acquisition of goods or services that are unique and not easily acquired through the normal competitive bid process.

   (i) Procedures to ensure that vendor files maintained by the casino licensee or casino license applicant contain all forms, documentation, and approvals required by the internal control procedures.

   (j) A prohibition against the purchase or lease of gaming equipment or supplies from anyone other than a supplier that is licensed under the act.

   (k) Procedures for the approval of contracts or transactions in an amount that is more than $5100,000.00.

   (l) The minimum dollar amount of contracts or transactions with 1 vendor in a 12-month period that require approval by the licensee's authorized representative. The amount must shall not be more than $150,000.00.

   (m) A written policy regarding the acceptance of gifts or gratuities by purchasing and contracting personnel from suppliers of goods or services.

   (n) Any other Other internal control procedures the board deems determines necessary to ensure compliance with the act and these rules and prevent money laundering, kickbacks, and other unlawful or commercially unreasonable transactions.

R 432.1218  Related party contracts or transactions.

  Rule 218. (1) Unless otherwise directed by the board, the internal control procedures for disclosure and approval of related party contracts or transactions do not apply to any of the following transactions:

   (a) Transactions between a casino licensee or a casino license applicant and a supplier licensee.

   (b) The payment of dividends or other distributions to members or shareholders.

   (c) Scheduled repayments of related party debt.

(2) A related party transaction must comply shall be in compliance with the internal control procedures set forth in these rules and both of the following provisions:

   (a) A related party transaction or series of related party transactions reasonably anticipated to be greater than $250,000.00 in a 12-month period shall be is subject to approval by the board of directors, the owner, or a designee of equivalent level.

   (b) A reputable and independent organization which that is knowledgeable in the area of related party transactions or contracts and which is approved by the board shall provide a written favorable fairness opinion for all related party contracts, transactions, or series of transactions expected to be more than $5,000,000.00, unless otherwise directed by the board.

R 432.1220  Board reports.

  Rule 220. (1) The casino licensee or casino license applicant shall, on a an annual quarterly basis, file a summary of all contracts and nonwagering transactions which that involve an amount of more than $250,000.00 or which are reasonably anticipated to be more than $250,000.00 in a 12-month period. Annual reports must be based on a calendar year beginning January 1 and ending December 31, unless otherwise approved by the board. The quarterly reports shall be due on the fifteenth day of April, July, October, and January. The reports shall must be compiled in the manner, and on the form, prescribed by the board and shall include all of the following information:

   (a) The name, business address, and business telephone number of the party with whom the casino licensee or casino license applicant entered a contract and whether or not the party is or was a related party.

   (b) The amount of the transaction or payments under the contract.

   (c) The date of execution.

   (d) The nature of the contract or transaction, including the type of goods or services to be provided.

   (e) A determination of how the commercial reasonableness of the contract, transaction, and consideration for related goods or services was ascertained.

   (f) A statement certifying that all contracts and transactions summarized in the quarterly report comply are in compliance with this rule. The certification statement shall must be signed by the general manager, senior financial officer, or person holding an equivalent position, of the casino licensee or casino license applicant.

   (g) Any other Other information the board deems determined necessary to ensure compliance with the act or these rules.

  (2) The annual quarterly report shall must contain the information set forth in subrule (1) of this rule with respect to any oral contracts or transactions that involve an amount more than $5025,000.00 in a 12-month period.

  (3) The annual report is due on January 31 of each year.

R 432.1221 Mandatory contract notification.

  Rule 221. (1) A casino licensee or casino license applicant shall notify the board, in writing, on a quarterly basis as soon as practicable, after entering into a contract, transaction, or series of transactions in an amount which that is more than $500,000.00 $2,000,000.00 or which is reasonably anticipated to be more than $500,000.00 $2,000,000.00 in any 12-month period. The written notice shall must be on forms prescribed by the board and shall contain, at a minimum, the information in R 432.1220.

 (2) A casino licensee or casino license applicant shall include a contract described in this rule in the quarterly and annual reports submitted under R 432.1220.

R 432.1222 Confidential records. Rescinded.

Rule 222. Materials, or portions of materials, submitted under the act or these rules may be identified as confidential by a licensee, an applicant for a license, or any other person. If the materials are exempt from disclosure by statute, the materials shall not be disclosed by the board, except to other jurisdictions or law enforcement agencies as provided in the act.

R 432.1223  Waiver of requirements.

  Rule 223. The board may, in writing, waive, restrict, or alter any requirement or procedure set forth in these rules, if the board determines any of the following:

   (a) That the requirement or procedure is impractical or burdensome,.

   (b)  That That the waiver, restriction, or alteration is in the best interest of the public and the gaming industry,.

   (c) And that That the waiver, restriction, or alteration is not outside the technical requirements necessary to serve the purpose of the requirement or procedure.

R 432.1232  Review of information at licensee's or applicant's premises; costs.

Rule 232. (1) At the option of the executive director of the board, the The executive director or his or her executive director’s designee may review, at the premises of the custodian of the information, any information that the act, these rules, the executive director, or the executive director’s his or her designee requires from any of the following entities:

   (a) A license applicant.

    (b) A licensee.

    (c) An affiliate of a license applicant or licensee.

    (d) A person who holds more than a 51% direct or indirect interest in an applicant or licensee.

  (2) If information is reviewed at the premises of the custodian of the information then the license applicant or licensee shall, as soon as practicable, reimburse the board for all incremental expenses incurred in performing the review at the premises of the custodian of the information, including travel, food, and lodging. Reimbursement shall must be exclusive of all other fees required under the act and these rules.

PART 3.  LICENSES

R 432.1301  Application explained; applicant to demonstrate eligibility, qualification, and

  suitability; revocability of license or certificate; applicant and licensee acceptance of   

  certain risks; claim of privilege as to testimony or evidence; applicant and licensee duties.

  Rule 301. (1) An application for a license under the act and these rules is a request by the applicant seeking a revocable privilege. A license will be is granted by the board if the applicant meets the licensing requirements of the act and these rules.

  (2) An applicant or licensee for a license under the act and these rules shall, at all times, have the burden of demonstrating to the board, by clear and convincing evidence, that the applicant or licensee the applicant is eligible, qualified, and suitable to be granted and retain the a license. for which application is made under the applicable licensing standards and requirements of the act and these rules.

  (3) A license or certificate of suitability issued by the board under the act or these rules is a revocable privilege granted by the board. A person who that holds a license or certificate of suitability does not acquire, and shall not be deemed determined to acquire, a vested property right or other right, in the license or certificate.

  (4) An applicant or licensee shall accept any risk of adverse publicity, public notice, notoriety, embarrassment, criticism, financial loss, or other unfavorable or harmful consequences that may occur in connection with, or as a result of, the application and licensing process or the public disclosure of information submitted to the board with a license application or at the board's request under the act and these rules.

  (5) An applicant or licensee may claim any privilege afforded by the Constitution constitution of the United States or laws of the United States or of this state the state of Michigan in refusing to answer questions or provide information requested by the board. However, a claim of privilege with respect to any testimony or evidence pertaining to the eligibility, qualifications, or suitability of an applicant or licensee to be granted or hold a license under the act and these rules may constitute cause for denial, suspension, revocation or restriction of the license.

  (6) An applicant and licensee shall have a continuing duty to do all of the following:

   (a) Disclose promptly to Notify the board any of a material change in the information contained submitted in a the license application, renewal report, or renewal form submitted by the applicant or licensee or a change in circumstance, that may render the applicant or licensee ineligible, unqualified, or unsuitable to hold the license under the licensing standards and requirements of the act and these rules. An applicant or licensee shall ensure that all required release of information forms submitted to the board are current.

   (b) Maintain the applicant's or licensee's eligibility, qualifications, and suitability to be issued and hold the license held or applied for under the act and these rules.

   (c) Provide any information requested by the board relating to licensing or regulation; cooperate with the board in investigations, hearings, and enforcement and disciplinary actions; and comply with all conditions, restrictions, requirements, orders, and rulings of the board in accordance with the act and these rules.

  (7) An applicant, licensee, or person required to be qualified as part of an application for the issuance of, or a request for renewal of, a license shall authorize and consent, in writing, that fingerprints provided to the board for purposes of identification, qualification, licensing, or license renewal may be forwarded to the Michigan state police and retained by the Michigan state police for any lawful investigative and identification purposes, including, without limitation, background investigations related to determining qualification and licensure. The Michigan state police shall retain and use fingerprints that it receives from the board for lawful investigative and identification purposes.

R 432.1303  Fees, fines, charges, and assessments.

  Rule 303. (1) All fees, fines, charges, and assessments provided for under these rules must shall be timely submitted to the board by a payment method acceptable to the board, such as a certified check, cashier's check, money order made payable to "State of Michigan," or electronic wire transfer.

  (2) The following nonrefundable license application fees shall must be submitted to the board, together with the required application form or forms, for the corresponding license classification to which the fees relate:

   (a) Casino license: $50,000.00.

   (b) Supplier license: $2,500.00.

   (c) Occupational license, level 1: $500.00.

   (d) Occupational license, level 2: $100.00.

   (e) Occupational license, level 3: $50.00.

  (3) The license application fee shall must be used by the board to conduct an appropriate background investigation of the applicant as prescribed by the board, the act, and these rules. No portion of a remitted license application fee shall can be refunded.

(4)(3) An additional background investigation charge may be assessed to the extent that the board's direct investigative costs exceeds the applicant's application fee. Unless otherwise determined by the board, a license or certificate of suitability may not be issued until payment of the additional assessed charge for completion of the background investigation is received by the board.

(5)(4) A licensee may also be assessed the board's direct investigative costs arising from a background investigation for renewal of a license to the extent such the costs exceed the application fees. The board may deny a renewal application if the licensee does not pay the assessed costs by a date set by the board.

(6)(5) The following license fees shall must be submitted to the board by the applicant or licensee upon initial issuance of the license and for each subsequent renewal of the license under the act and these rules:

   (a) Casino license: $25,000.00.

   (b) Supplier license: $5,000.00.

   (c) Occupational license, level 1: $250.00.

   (d) Occupational license, level 2: $100.00.

   (e) Occupational license, level 3: $50.00.

R 432.1304 Persons required to be qualified for issuance and renewal of casino and supplier

  licenses.

  Rule 304. (1) The board shall not issue or renew a casino license or supplier license unless every person required by the act and these rules to qualify, as part of the application or request for the issuance or renewal of the license, has first been determined by the board eligible, qualified, and suitable in accordance with the relevant licensing standards set forth in the act and these rules.

  (2) The following persons shall be required to qualify as part of the application for the issuance, or request for renewal, of a casino license or supplier license:

   (a) If the person who that makes submits an application for a casino license or supplier license is a person whose stock, equity interest, or ownership interest is publicly traded and regulated by the Securities and Exchange Commission, each of the applicant's key persons.

   (b) If the person who that makes submits an application for a casino license or supplier license is not a person whose stock is publicly traded and regulated by the Securities and Exchange Commission, each of the applicant's key persons and each person, other than a publicly

traded corporation and its 5% or less shareholders, that has a combined direct, or indirect, or attributed interest greater than 51% in the applicant.

   (c) A person who that is required to apply for a casino license or supplier license under the act and these rules.

   (d) A person who that is included in the term "applicant" as that term is defined by the act under section 2 of the act, MCL 432.202 except for a managerial employee who is not a key person.

  (3) The board may at any time require a person that applies for or holds a casino license or supplier license to establish the qualifications of any other another affiliate, investor, creditor, employee, agent, or representative of the applicant or licensee or another any other person that is connected, related, or associated with the applicant whom the board determines must be qualified under the act and these rules.

  (4) A person required to qualify as part of the application or request for issuance or renewal of a casino license or supplier license shall complete and file with the board an application or annual renewal report and required disclosure forms in the manner and form prescribed by the board.

  (5) A person that applies for or holds a casino or supplier license shall ensure that all persons who are required by the act and these rules to establish their qualifications as part of the applicant's application for the issuance, or the licensee's maintenance or renewal, of the casino license or supplier license have filed, with the board, all required applications, reports, and disclosure forms in the manner and form prescribed by the board.

R 432.1307  Public investigative hearing; action on casino license application.

  Rule 307. The requirements for the public investigative hearing and action by the board on a casino license application are as follows:

   (a) After the board receives notice from the executive director that the background investigation of the applicant and application has been completed, the board shall schedule and conduct a public investigative hearing regarding the applicant and application, without undue delay, under section 6(7) of the act, MCL 432.206.

   (b) If the board or the executive director, in reviewing the application or as a result of the background investigation, identifies an apparent deficiency that may require denial of the application, then the board shall promptly notify the applicant and the city, in writing, of the apparent deficiency in the application and shall provide the applicant with a reasonable period of time, as determined by the board, to correct the apparent deficiency before scheduling and conducting a public investigative hearing on the application.

   (c) The board shall conduct a public investigative hearing in accordance with the procedural requirements for a contested case under the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328, except as follows:

   (i) The person applying for the license shall at all times have the burden of establishing and demonstrating, by clear and convincing evidence, its eligibility and suitability for licensure under the act and these rules.

   (ii) The board shall base its decision to grant or deny a casino license upon the whole record before the board and is not limited to testimony and evidence submitted at the public investigative hearing.

  (iii) Only the board and the person applying for the casino license at issue may be parties at the public investigative hearing, except that the attorney general may intervene and represent the interests of the people of this state in accordance with state law.

   (d) The board shall provide the person applying for the license with not less than 2 weeks’ written notice of the public investigative hearing. The notice shall must include all of the following information:

  (i) A statement of the date, hour, place, and nature of the hearing.

  (ii) A statement of the legal authority and jurisdiction under which the hearing is to be held.

  (iii) A short and plain statement of the issues involved, and reference to the pertinent sections of the act and rules involved.

   (iv) A short description of the order and manner of presentation for the hearing.

   (e) Not less than 2 weeks before the hearing, the board shall also post notice of the public investigative hearing at its business offices in a prominent place that is open and visible to the public.

   (f) The board shall also publish reasonable notice of the public investigative hearing in the 2 newspapers that have the largest circulation in the this state and in other appropriate newspapers in the this state that are selected by the executive director.

   (g) The board, 1 or more of its members, the executive director, or 1 or more hearing officers designated and authorized by the board may conduct and preside over the public investigative hearing regarding a casino license application and may do all of the following:

  (i) Administer oaths and affirmations.

  (ii) Sign and issue subpoenas in the name of the board that require the attendance of witnesses, the giving of testimony by witnesses, and the production of books, papers, notes, records, and other documentary evidence.

  (iii) Provide for the taking of testimony for the hearing by deposition.

  (iv) Establish and regulate the order of presentation and course of the hearing, set the time and place for continued hearings, and fix the time for filing written arguments, legal briefs, and other legal documents.

  (v) Accept and consider relevant written and oral stipulations of fact and law that are made part of the hearing record.

   (h) The chair may designate the executive director or 1 or more hearing officers to conduct, or assist the board in the conduct of, the hearing, which may include preparation of a proposal for the board's decision after all testimony and evidence has been presented at the hearing.

   (i) The person applying for the license shall be given a full opportunity during the hearing to question and cross-examine witnesses presented by the board, to present all relevant information to the board regarding its application and eligibility and suitability for licensure, and to call witnesses to testify and provide information at the hearing for and on the applicant's behalf. Upon On request of the applicant, the board, the executive director, or the board's designated hearing officer or officers shall issue subpoenas requiring the appearance of witnesses whom the applicant intends to call to testify on its behalf at the hearing and requiring the production of relevant notes, papers, memoranda, records, documents, and other materials at the hearing for consideration by the board. The applicant is responsible for serving the subpoenas.

   (j) The members of the board, the board's designated hearing officer or officers, the executive director, and the assistant attorney general assigned to assist the board in the conduct of the hearing may do all of the following:

   (i) Question, through direct examination or cross-examination, or both, the applicant and any witnesses called by the applicant regarding their testimony and any aspect of the applicant's application and relevant background.

  (ii) Recall the applicant and other witnesses called by the applicant during the hearing for further questioning.

  (iii) Subpoena other witnesses not called by the applicant to testify and present evidence and information regarding the applicant's application and relevant background.

   (k) The board, the executive director, or hearing officer presiding at the hearing may, in the exercise of his or her their discretion, grant the applicant an opportunity for rebuttal of allegations raised during the hearing.

   (l) After the person applying for the license has made its presentation in support of its application and licensure, representatives of government entities and agencies and the public at large shall have a reasonable opportunity during the hearing to give testimony and comments relevant to the applicant and application and the issue of licensure. The hearing notice must shall state and give notice that opportunity for testimony and comment will be provided during the hearing. The chair or other presiding officer shall announce at the start of the hearing when and how testimony and comments may be presented during the hearing.

   (m) A person who testifies at the hearing shall be sworn and testify under oath.

   (n) The board may continue the hearing for as long as it deems determines necessary and may recess and reconvene the hearing at its discretion.

   (o) The board shall record the public hearing, stenographically or by other means to adequately ensure preservation of an accurate record of the hearing. A transcript prepared by a certified reporter or stenographer hired by the board is the official record of the public hearing.

   (p) After all testimony and evidence has been presented, the board shall recess the hearing. While the hearing is in recess, all of the following shall must occur:

   (i) The hearing record shall must be transcribed and provided to the board, the executive director, and the designated hearing officer or officers for review.

  (ii) The chair shall prepare or direct 1 or more members of the board, the executive director, or the designated hearing officer or officers who conducted or assisted the board in the conduct of the hearing to prepare a written proposal for the board's decision after reviewing the hearing record.

  (iii) The proposal for decision shall must contain a statement of the reasons for the proposed decision and each finding of fact and conclusion of law necessary to the proposed decision.

   (iv) The written proposal for the board's decision shall must be submitted to the board for review and consideration and copies shall must be served on the applicant and the city before the board reconvenes the hearing to render its decision.

  (v) If the proposal for the board's decision identifies an apparent deficiency that may require denial of the application, then the board shall provide the applicant with a reasonable period of time, as determined by the board, to correct the apparent deficiency before reconvening the hearing to deliberate and render its decision.

   (vi) If the proposal for the board's decision is adverse to the applicant, then the board shall give the applicant a reasonable opportunity to file exceptions and written argument with the board objecting to the proposal for decision.

   (q) The board shall reconvene the hearing, without undue delay, after the requirements specified in subdivision subrule (p) of this rule have been completed, to deliberate and render its final decision on the application. If the proposal for the board's decision is adverse to the applicant, then the board may permit allow oral argument in support of and in opposition to the proposal for decision when the hearing is reconvened. Four members shall be present when the hearing is reconvened to constitute a quorum, and 3 votes are required to support the board's final decision. The board may accept, modify, or reject the written proposal for the board's decision in deciding and rendering its final decision on the application.

   (r) In deciding whether to grant or deny an applicant's casino license application, the board shall consider and determine whether the application complies with the requirements of the act and these rules and whether the applicant and other persons affiliated with, or otherwise associated with, the applicant as an investor, owner, key person, or managerial employee are eligible, qualified, and suitable for licensure under the licensing standards and criteria set forth in the act and these rules relating to all of the following:

(i) Character.

   (ii) Reputation.

   (iii) Integrity.

   (iv) Business probity, experience, and ability.

  (v) Financial ability and responsibility.

   (vi) Other relevant licensing requirements, standards, and criteria provided in the act and these rules.

   (s) The decision of the board shall must be reduced to writing and signed by the board members who voted in support of the decision.

   (t) If the board finds that the casino license applicant is eligible, qualified, and suitable for licensure under the act and these rules, then it the board shall direct the executive director to serve the applicant and the city with a copy of its decision and to issue a certificate of suitability to the applicant. The certificate entitles the applicant to be granted a casino license by the board when it determines, to its satisfaction, that the applicant is prepared and able to open its proposed casino to the public and conduct its casino gambling operation in compliance with specified conditions and requirements set forth in the certificate of suitability and the requirements of the act and these rules. The public investigative hearing shall must be reconvened at a later time for the purpose of determining whether the applicant is prepared and able to open its proposed casino to the public and conduct its casino gambling operation in compliance with specified conditions and requirements set forth in the certificate of suitability and the requirements of the act and these rules.

   (u) If the board finds that the applicant is not eligible, qualified, and suitable for licensure under the act and these rules, then it the board shall enter an order direct the executive director to issue and the order serve a notice of denial and along with a copy of the board's written decision must be served on the applicant and the city by certified mail or personal delivery.

   (v) An applicant may appeal the denial of a casino license to the court of appeals as provided in the act.

R 432.1308  Certificate of suitability.

  Rule 308. (1) The certificate of suitability is valid while the holder is making

satisfactory progress toward meeting the conditions of the certificate of suitability.

  (2) If the board receives a written report from the executive director that the holder of a certificate of suitability is not making reasonable progress toward meeting the conditions of its certificate of suitability, then the board shall reconvene the public investigative hearing for the purpose of considering the applicant's compliance with the conditions of its certificate of suitability.

  (3) If, upon reconvening the public investigative hearing, the board finds that the holder of a certificate of suitability is not making, or has not made, reasonable progress toward meeting the conditions of its certificate of suitability, then the board may take whatever action is necessary to assure ensure compliance or may cancel and withdraw the certificate of suitability and make a final decision on the application.

  (4) The board shall not issue a casino license to the holder of a certificate of suitability until the board finds that the holder is prepared and able to open to the public and conduct its casino gambling operation in compliance with the conditions and requirements of the certificate of suitability, the act, and these rules.

  (5) In deciding whether a casino license shall be issued to the holder of a certificate of suitability, the board shall assess the proposed gambling operation to determine its compliance with the conditions and requirements of its certificate, the act, and these rules. All of the following matters shall must be assessed by the board:

   (a) The managerial structure for gambling operations and casino operations and the managerial experience, ability, skills, and qualifications of key persons and other managerial employees of the gambling and casino operations.

   (b) The casino floor plan and related plans and activity regarding equipment installation, operation, and maintenance.

   (c) The casino’s handicap Handicap access.

   (d) The casino’s support Support facilities.

   (e) The applicant's internal control system and casino accounting policies and procedures.

   (f) The applicant's security operations and required casino critical computerized systems.

   (g) The applicant's staff training, qualifications, ability, and supervision.

   (h) The applicant's liability insurance and other required insurances.

   (i) The casino Casino enterprises and related casino operations.

   (j) The applicant's construction progress and compliance with its proposed construction schedule.

   (k) Other matters pertaining to the operations and procedures of the gambling and casino operations as the board may require when at the time the certificate of suitability is issued, if the casino licensee is given notice and an opportunity to address any board concerns regarding the matters.

  (6) The board may establish a schedule setting a timetable for satisfactory compliance concerning all operations and facilities to be assessed and all other conditions and requirements of the certificate of suitability, the act, and these rules.

  (7) During the interim compliance period, while the certificate of suitability is in effect, the holder shall do all of the following:

   (a) Apply for and receive the appropriate liquor license from the Michigan liquor control commission if the holder plans to serve alcoholic beverages or liquor in connection with its gambling operation or related casino enterprises.

   (b) Apply for and receive all permits, certificates, and approvals for the casino and related casino enterprises and support facilities necessary to develop, construct, open to the public, and conduct casino and gambling operations in accordance with the act, these rules, and conditions of the certificate of suitability, including, but not limited to, all of the following:

   (i) Fire marshal permits.

   (ii) Public health permits.

(iii) Building permits.

   (iv) Zoning permits.

   (c) Obtain ownership or use of necessary land for the site of the casino and related casino enterprises.

   (d) Obtain the financing necessary to complete development and construction of the casino and related casino enterprises and conduct casino and gambling operations.

(e) Complete, in a timely manner, construction of the proposed casino and related casino enterprises, infrastructure, and other support facilities, including parking areas, roadways, and walkways, in accordance with the applicant's development agreement with the city and the proposed construction schedule and timetables established by the board.

(f) Post the required bond in compliance with section 8a of the act, MCL 432.208a, and these rules.

   (fg) Obtain all insurance deemed determined necessary and required by the board.

   (gh) Obtain and install all necessary EGDs and gaming equipment to conduct the casino gambling operation.

   (hi) Hire and train qualified staff to conduct all aspects of the casino and gambling operations and related support operations.

   (ij) Take other action the board deems determines necessary to ensure that the holder of the certificate of suitability will be is prepared and able to open to the public and conduct its casino and gambling operations in compliance with the conditions and requirements of its certificate of suitability, its development agreement, the act, and these rules.

R 432.1309  Casino license issuance.

  Rule 309. (1) The holder of the certificate of suitability shall advise the board, in writing, when it believes that it has complied with the conditions of its certificate of suitability and other requirements of the board for granting and issuing of a casino license and is prepared, ready, and able to open to the public and conduct its proposed casino operations and gambling operations in compliance with the certificate, the act, and these rules.

  (2) Upon On receipt of the written notice from the holder of the certificate of suitability specified in subrule (1) of this rule, the executive director or his or her the executive director’s designee shall conduct a thorough inspection of the holder's casino and related casino enterprises, support facilities, casino operations, and gambling operations and then report back to the board, in writing, whether the holder has satisfactorily complied with the conditions and requirements of the board for granting and issuing a casino license to the holder under the certificate, the act, and these rules. The executive director or the executive director’s his or her designee shall also report whether the holder is prepared, ready, and able to open to the public and conduct its proposed casino operation and gambling operations in compliance with the act and these rules.

  (3) The executive director shall ensure that a copy of his or her their written report to the board is served on the holder of the certificate of suitability and the city.

  (4) Upon On receipt of the executive director's report, the board shall reconvene the public investigative hearing for purposes of taking further evidence and rendering its final decision on the application.

  (5) The board shall place restrictions and conditions on a casino license, including, but not limited to, all of the following:

   (a) The licensee shall continue to comply with all agreements it may have with any governmental authority.

(b) The licensee shall post and maintain its required bond in accordance with section 8(a) of the act.

   (cb) The licensee's gambling operation shall undergo, and successfully complete, a sufficient number and type of practice gambling operations to ensure that the gambling operation is conducted in compliance with the act and these rules.

   (dc) The licensee shall pay the required annual license fee upon issuance of the casino license.

   (ed) The licensee shall satisfactorily complete or comply with any uncompleted or noncomplying aspects of its proposed casino and related casino enterprises, support facilities, and casino and gambling operations within specified time frames established by the board.

R 432.1310 Casino license bond. Rescinded.

  Rule 310. (1) The holder of a certificate of suitability shall post a bond in the sum of $1,000,000.00 payable to: "State of Michigan," under the requirements of section 8(a) of the act, before a casino license will be issued to the holder.

  (2) Unless otherwise required by the board, a casino license bond shall be in compliance with all of the following additional requirements:

(a) A surety bond must be with a surety company that is approved by the board and guaranteed by a guarantor that is approved by the board.

(b) An irrevocable line of credit issued as security for a bond must also be approved by the board.

(c) If the holder of the certificate of suitability plans to post a surety bond, negotiable securities, or irrevocable letter of credit, then the holder shall submit its bond proposal not less than 45 days before the time the bond is to be posted to allow the board sufficient time to investigate and approve the proposed bond and the surety, guarantor, or banking institution that issued the bond and irrevocable letter of credit or negotiable securities guaranteeing payment of the bond.

(d) The bond shall be payable to the state of Michigan as obligee for use in payment of the casino licensee's financial obligations to the state and as security to guarantee that the licensee faithfully makes the payments, keeps its books and records, makes reports, and conducts its casino gambling operation in conformity with the act and these rules.

(e) The bond shall provide that it may be exercised by the state if the licensee fails to substantially comply with its obligations under the act, and these rules.

(f) The bond shall state that it shall run continuously and remain in full force and effect throughout the period during which the license is held, unless the surety cancels the bond by giving the board not less than 30 days' written notice.

  (3) The board may demand that a casino licensee post a new bond that complies with the act and subrules (1) and (2) of this rule if any of the following provisions apply:

(a) Liability on the existing bond is discharged or reduced by judgment rendered, payment made, or other situation.

(b) The board determines that any surety, guarantor, irrevocable letter of credit, or other negotiable securities on the old bond are no longer satisfactory and approved.

(c) The board determines that the banking institution that issued the irrevocable letter of credit or other negotiable securities on the old bond is no longer satisfactory or approved.

(d) The licensee requests to post a new bond.

(e) The board receives notice that the bond will be canceled.

R 432.1313 Casino licensee's duty to remain eligible, qualified, and suitable and to disclose material changes.  Rescinded.

  Rule 313. (1) To assure compliance with the act and these rules, the board shall continue its investigation throughout the period of licensure for purposes of monitoring and determining whether the licensee continues to be eligible and suitable to hold the license and shall, accordingly, maintain the confidentiality of its investigative files in accordance with section 4c(1)(a) of the act.

(2) A casino licensee has a continuing duty to remain eligible, qualified, and suitable to hold the casino license under the licensing standards, criteria, and requirements of the act and these rules.

(3) Issuance of the casino license does not create a property right. Issuance of the license instead gives to the holder a revocable privilege granted by the state conditioned upon the holder's continuing eligibility, qualifications, and suitability to hold the license under the act and these rules.

(4) A casino licensee and holder of a certificate of suitability shall have a continuing duty to promptly notify the board, in writing, without undue delay, of any material change in the information provided in its application or renewal report or reports and any other change in circumstances reasonably related to its eligibility, qualifications, and suitability to be issued, or continue holding, a casino license under the licensing standards, criteria, and requirements of the act and these rules.

R 432.1321  Supplier license required to provide gaming-related goods and services.

  Rule 321. (1) A person shall not supply or provide goods or services to a casino licensee, casino license applicant, or holder of a certificate of suitability that are directly related to gambling, that are directly related to the conduct of gambling activity, or that otherwise directly affect the play and results of gambling games authorized, conducted, and played under the act and these rules, unless the person holds a supplier's license. In determining whether a person is required to be licensed as a supplier under this rule, the board shall consider, without limitation, whether the person meets 1 or more of the following criteria:

   (a) The person manufactures, supplies, or distributes devices, machines, equipment, items, or articles that meet any of the following provisions:

   (i) Are specifically designed for use in the conduct of gaming.

   (ii) Are needed to conduct gaming.

   (iii) Have the capacity to affect the outcome of the play of a gambling game.

   (iv) Have the capacity to affect the calculation, storage, collection, or control of gross receipts.

   (b) The person services or repairs electronic or live gambling devices, machines, equipment, items, or articles used in gaming.

   (c) The person provides services directly related to the operation, security, surveillance, regulation, or management of gaming in a casino.

   (d) The person provides other goods or services determined by the board to be so utilized in, or incident to, the operation of a casino or gaming that the person must shall be licensed as a supplier to protect the public and enhance the credibility and integrity of gaming in this state.

  (2) The following persons shall be licensed under the criteria specified in subrule (1) of this rule:

   (a) Manufacturer, supplier, distributor, servicer, or repairer of any of the following:

    (i) EGDs.

(ii) Cards.

   (iii) Dice.

   (iv) Gaming chips.

   (v) Gaming plaques.

   (vi) Dealing shoes.

   (vii) Drop boxes.

   (viii) Computerized gaming monitoring systems.

   (ix) Cashless wagering systems.

   (x) Credit voucher machines.

  (xi) Other gaming equipment or supplies.

   (b) A provider of casino surveillance and security systems and services.

R 432.1322  Supplier license requirements for providers of nongaming-related goods and

  services.

  Rule 322. (1) Unless exempted from this requirement, a person must shall not, on a regular and continuing basis, supply or provide goods or services to a casino licensee, casino license applicant, or holder of a certificate of suitability regarding the realty, construction, maintenance, operation or business of a casino or casino enterprise if the goods or services are not directly related to, used in connection with, or affect gaming, unless the person holds a supplier's license.

  (2) A person required to be licensed under this rule includes, without limitation, a person who that provides any of the following goods or services to a casino licensee, casino license applicant, or holder of a certificate of suitability on a regular and continuing basis:

   (a) Alcoholic beverages, food, or nonalcoholic beverages, gaming table layouts, and nonvalue gaming chip sorters.

   (b) Garbage handling and pickup, vending machines, linen supplies, laundry services, landscaping, janitorial, or building maintenance services.

   (c) Management and operation of casino enterprises, or junket enterprises.

   (d) Limousine services.

   (e) Real estate, building, or construction services.

(f) Junket representatives.

(3) A person is deemed determined to be transacting business with and providing nongaming-related goods or services to a casino licensee or holder of a certificate of suitability on a regular and continuing basis if the total dollar amount of the person’s nongaming-related business transactions with any 1 casino licensee or holder of a certificate of suitability will be is equal to or greater than $5400,000.00, or an amount to be set by the board not to exceed $2,000,000.00, within any rolling 12-month period. The person must shall monitor its total dollar amount of business with casino licensees and holders of a certificate of suitability. and if If it reaches the monetary threshold, then the person must shall immediately either apply for a supplier's license or cease doing business with casino licensees and holders of a certificate of suitability. If a person does not comply with this subrule’s provisions, then the casino licensees and holders of a certificate of suitability, must shall immediately terminate their business relationships with the person.

  (4) The board may exempt any person or field of commerce from the supplier-licensing requirements of these rules if the board determines that any of the following provisions apply to the person or field of commerce:

   (a) The person or field is an agency of state, local, or federal government.

   (b) The person or field is regulated by another regulatory agency in this state.

   (c) The person or field will shall provide goods or services of insubstantial or insignificant amounts or quantities.

   (d) Licensing of the person or field is not deemed determined necessary to protect the public interest or accomplish the policies and purposes of the act.

R 432.1327  Supplier-license application; board action.

  Rule 327. (1) After the background investigation is completed, the executive director shall must provide the board with a written report concerning the investigation. After receiving the executive director's report, the board will shall take action on the application.

  (2) If the board grants the application, it the board shall issue an order and shall direct the executive director shall to issue a supplier license upon the payment of the annual licensing fee. If the applicant's annual licensing fee is not received by the board within 14 days after the date of the mailing of the order, notification of the applicant's suitability for licensure to the applicant, then the board shall direct the executive director to shall issue the applicant a notice of denial.

  (3) If the board denies the application, the board then it shall direct the executive director to issue an order the applicant a notice of denial. When the board denies an application for a supplier license, the temporary supplier license expires and the applicant is prohibited from conducting business transactions with, and providing goods or services to, casino licensees, casino license applicants, and holders of certificates of suitability.

  (4) An order denying an application for a license A notice of denial is a finding that the applicant is ineligible, unqualified, or unsuitable to be licensed.

R 432.1338  Board or executive director action on occupational-license

  applications.

  Rule 338. (1) After the completion of the background investigation of a level 1 or 2

occupational-license application, the executive director must shall report to the board, in

writing, regarding the staff's background investigation of the level 1 or 2 occupational

license applicant. After receiving the executive director's report, the board may take

action on the level 1 or 2 application.

  (2) After completion of the background investigation of a level 3 occupational-license application, the executive director may take action on the level 3 application.

  (3) If an occupational-license application is granted, the executive director will shall issue

the license upon the payment of the licensing fee.

  (4) If the applicant’s licensing fee is not received within 30 days after notification of

his or her the applicant’s suitability for licensure, then the executive director shall will serve the applicant a notice of denial.

  (5) If the board denies a level 1 or 2 occupational license application, then it the board shall will issue an order direct the executive director to issue the applicant a notice of denial.

  (6) If the executive director denies a level 3 occupational license application, the

executive director must shall issue the applicant a notice of denial.

  (7) A board order denying an application for a license or a notice of denial issued by the executive director is a finding that the applicant is ineligible, unqualified, or

unsuitable to be licensed.

  (8) If an application for an occupational license is denied either by board order or notice of denial, a temporary occupational license previously issued to the applicant expires, and the applicant is prohibited from performing duties requiring that license.

R 432.1341  Biennial renewal of occupational licenses.

  Rule 341. (1) An occupational license may be renewed biennially.

  (2) An occupational licensee intending to renew his or her their license may pay the

licensing fee and request renewal of the license, in the manner and on a form prescribed

by the board, not less than 30 days before the expiration of the occupational license.

  (3) After the background investigation is completed, the executive director shall must

either decide to grant or deny the renewal application or submit the results of the background investigation to the board for decision.

  (4) If the renewal application is granted by the board or the executive director, then the executive director will issue a new license is issued to the applicant.

  (5) If the renewal application is denied by the board, the board shall issue an order denying the renewal application. If the renewal application is denied by the executive director, then the executive director will shall issue a notice of denial to the applicant.

(6) A board order denying the renewal application, or a notice of denial issued by the executive director, is a finding that the licensee is ineligible, unqualified, or unsuitable for licensure or is otherwise in violation of the licensing requirements of the act or these rules of the board.

  (7) If the licensee files a renewal request and pays the licensing fee in a timely

manner and in the manner and form prescribed by the board, then the licensee’s existing

occupational license does not expire until a decision on the application for renewal is

made. If renewal is denied or the new license is restricted or limited, then the existing

occupational license does not expire until the last day to apply for judicial review or a

later date fixed by order of the reviewing court.

R 432.1501  Applicability of part; transfer of ownership interest; limitation.

  Rule 501. (1) An interest in a person applying for or holding a casino license or supplier license may only be transferred in accordance with this part. Except as stated in subrules (3) and (5) of this rule, the following persons must receive board approval before transferring the interest:

   (a) A person that transfers or acquires greater than a 5% interest in a person in a publicly traded corporation that has applied for or holds a casino license or supplier license in this state.

   (b) A person that will, as a result of an acquisition approved by the board, have acquired an interest totaling greater than 5% in a person of a publicly traded corporation that has applied for or holds a casino license or supplier license.

(c) A person that transfers or acquires greater than a 1% interest in a person, other than a publicly traded corporation that has applied for or holds a casino license or supplier license in this state.

(d) A person who will, as a result of an acquisition approved by the board, have acquired an interest totaling greater than 1% in a person, other than a publicly traded corporation, that has applied for or holds a casino license or supplier license in this state.

  (2) Before or when the board approves a transfer of interest, it must shall determine that the person acquiring the interest is eligible and suitable under the standards set forth in the act and these rules, unless the board grants the person an institutional-investor waiver under these rules or under section 6c of the act, MCL 432.206c.

  (3) A transfer of interest to an institutional investor that acquires or will have acquired, upon completion of the transfer, less than 15% of the equity securities of a person that applies for or holds a casino license or supplier license may occur without first receiving board approval but is subject to other requirements of this part.

  (4) The organizational documents of all persons who have applied for or hold a casino license or supplier license must contain a provision stating that transfers of ownership interests in the applicant or licensee may only be made in accordance with this rule.

(5) A transfer of interest in a supplier licensee may occur without first receiving board approval if the transfer is between persons the board has found eligible, qualified, and suitable for licensure during the licensing period in which where the transfer occurs. In those cases, approval of the transfer must be requested no later than 30 days after the transfer, and the executive director may decide the application. If approval is denied, the transferee must shall divest itself of the interest within 30 days after the date of the order denying approval.

R 432.1504  Waiver for institutional investors.

  Rule 504. (1) An institutional investor who acquires beneficial ownership of a person that has applied for or holds a casino license or supplier license shall notify the board within 14 days after the institutional investor acquires the interest or files form 13-D or 13-G with the Securities and Exchange Commission, or both, and shall provide additional information, and may be subject to a finding of suitability, as required by the board.

  (2) An institutional investor who acquires and holds a less than 15% interest for investment purposes only in a person that has applied for or holds a casino license or 25% interest for investment purposes only in a person that has applied for or holds a supplier license in this state may, in a manner and form prescribed by the board, apply to the board for a waiver of the eligibility and suitability requirements of the act.

  (3) The licensee in whom the institutional investor acquires the interest must shall file an application for approval of the transfer within 30 days after the transfer. Within the same time period, the institutional investor must shall file either an application for a waiver or application and disclosure forms for qualification as part of the licensee’s application, if the institutional investor does not hold the interest for investment purposes only relevant licensee’s license.

(4) Unless otherwise provided by the board, an application for a waiver shall include all of the following information:

(a) A description of the institutional investor’s business and a statement as to why the institutional investor is within the definition of institutional investor.

(b) A certification made under oath and subject to the penalty of perjury that the interest was acquired, and is being held, for investment purposes only and was acquired, and is being held, in the ordinary course of business as an institutional investor and not for the purpose of causing, directly or indirectly, the election of a majority of the board of directors or any change in the corporate charter, bylaws, management, policies, or operations of the person in which the institutional investor has acquired the interest. The signatory shall also certify that it is not its current intention to influence or affect the affairs of the person in which it has acquired the interest. In addition, the signatory shall explain the basis of his or her authority to sign the certification and to bind the institutional investor to its terms. The certification shall also provide that the institutional investor agrees to be bound by, and comply with, the act and this part, is subject to the jurisdiction of the courts of Michigan, and consents to this state as the choice of forum if a dispute, question, or controversy arises regarding the application of this rule.

(c) The name, address, telephone number, and social security number of the officers and directors, or their equivalent, of the institutional investor as well as those persons who have direct control over the institutional investor’s holdings of voting securities of the person in which the institutional investor has acquired the interest.

(d) The name, address, telephone number, and social security number or federal tax identification number of each person who has the power to direct or control the institutional investor’s exercise of its voting rights as a holder of voting securities of the person in which it has acquired the interest.

(e) The name of each person who beneficially owns greater than 5% of the institutional investor’s voting securities or other equivalent.

(f) To the extent known by the institutional investor, a list of the institutional investor’s affiliates that have greater than a 5% interest in the institutional investor.

(g) A list of all equity securities of the person in which the institutional investor has acquired an interest subject to this part that are or were, directly or indirectly, beneficially owned by the institutional investor or its affiliates within the preceding 1-year period. This list shall set forth a description of the securities, the amount of the securities, and the date of the acquisition or sale, or both.

(h) A list of all regulatory agencies with which the institutional investor or any of its affiliates that beneficially own equity securities of the person in which it has acquired an

interest subject to this part files periodic reports, and the name, address, and telephone number of the person, if known, to contact at each agency regarding the institutional investor.

(i) To the extent known, a disclosure of all criminal sanctions imposed against the institutional investor, its affiliates, and any of its current or former officers or directors during the preceding 10 years. A disclosure of all regulatory sanctions imposed during the preceding 10 years and of any administrative or court proceedings filed against the institutional investor, its affiliates, or any of its current officers or directors in the preceding 5 years, or any former officer or director whose tenure ended within the preceding 12 months.

(j) A copy of any filing made under 15 USC 18a with respect to the acquisition or proposed acquisition of securities of the person in which it has acquired the interest subject to this part.

(k) Any additional information the board may request to ensure compliance with the act and these rules.

  (4) The board may require that any person, including an institutional investor, seeking approval to hold ownership interests subject to this part, apply for a finding of suitability in accordance with this rule if the board considers deems the finding of suitability necessary to ensure compliance with the act and these rules. If the board denies a request for an institutional investor waiver, the institutional investor must shall, within 30 days, either divest itself of the interest or file application and disclosure forms for qualification as part of the relevant licensee’s license.

  (5) The following activities are deemed determined to be consistent with holding equity securities for investment purposes only under this rule:

   (a) Voting, directly or indirectly, through the delivery of a proxy furnished by the board of directors, on all matters voted on by the holders of the voting securities.

   (b) Serving as a member of a committee of creditors or security holders formed in connection with a debt restructuring.

   (c) Nominating a candidate for election or appointment to the board of directors in connection with a debt restructuring.

   (d) Accepting appointment or election as a member of the board of directors in connection with a debt restructuring and serving in that capacity until the conclusion of the member's term.

   (e) Making financial and other inquiries of management of the type normally made by securities analysts for information purposes and not to cause a change in its management, policies, or operations.

   (f) Other activities that the board determines to be consistent with the investment intent.

  (6) A person created under the laws of a foreign country who acquires an interest of greater than 5% in a publicly traded corporation that has applied for or holds a casino license or supplier license or greater than 1% in a nonpublicly traded person that has applied for or holds a casino license or supplier license, shall file reports as the board may prescribe and is subject to a finding of suitability under the act.

R 432.1505  Denials; request for hearing.

  Rule 505. (1) If the board denies an application for transfer of an ownership interest covered by this part, then it shall issue an order a notice of denial to the applicant for qualification to acquire and hold the ownership interest.

  (2) A person applying for qualification to acquire and hold an ownership interest subject to this part who is served with a notice an order of denial under this rule may request a hearing.

  (3) If the person applying for qualification to acquire and hold an ownership interest subject to this part does not request a hearing, then the notice order of denial becomes the final order of the board.

  (4) Unless specifically stated to the contrary, a notice an order of denial of an application for qualification to acquire and hold an ownership interest under this rule shall does not constitute a finding that the applicant is not suitable for licensure.

R 432.1507  Proscribed activities with respect to unsuitable persons.

  Rule 507. (1) In refusing to grant approval for the transfer and acquisition of an interest covered by this part, the board may determine that a person seeking approval is not qualified to hold an interest in a person that has applied for or holds a casino license or supplier license in Michigan this state, under the standards for qualification and licensure under the act and these rules.

  (2) After the board serves a notice an order of denial on a person who applied for approval of a transfer and acquisition of an interest subject to this part, then the person that has applied for or holds a casino license or supplier license in this state Michigan shall not do any of the following:

   (a) Pay, to the person whose application was denied or who was found to be unqualified and unsuitable, any dividend or interest on equity securities or make any other another payment or distribution, except as permitted allowed by the board.

   (b) Recognize the exercise, by the person whose application was denied or was found to be unqualified and unsuitable, directly or indirectly, or through any proxy, trust, or nominee, of any voting right conferred by any securities or interest in any securities or recognize other control or ownership by the person.

   (c) Pay, to the person whose application was denied or was found to be unqualified and unsuitable, remuneration for services rendered.

   (d) Fail to pursue all lawful efforts to require the person whose application was denied to relinquish all securities, including, if necessary, the immediate repurchase of the equity securities from the person.

R 432.1601  Exclusion list; duty to exclude.

  Rule 601. (1) An person individual who is excluded under the act and these rules shall not be allowed permitted entry into any portion of a casino. If an person individual is placed on the board exclusion list by the executive director, then the person individual is prohibited from entering any casino in this  the state until a determination is made by the board or a court to the contrary.

  (2) If an excluded individual enters a casino and has winnings, the winnings must be confiscated and turned over to the board.  The board shall deposit the confiscated winnings into the compulsive gaming prevention fund created in section 3 of the compulsive gaming prevention act, 1997 PA 70, MCL 432.253.

  (23) A casino licensee shall exclude or eject any excluded person individual from a casino if the casino licensee or the casino licensee's agents know or reasonably should know that the person individual is on the exclusion list.

(34) A casino licensee shall inform the board, in writing, of the names of persons that it knows or should know meet the criteria for placement on an exclusion list and the reason the person individual meets the exclusion criteria.

(45) This rule does not preclude a casino licensee from ejecting or barring an person individual from its casino for reasons deemed determined necessary by the casino licensee. A casino licensee may seek to have an individual person it has ejected or barred from its casino placed on the exclusion list.

R 432.1702  Request for hearing.

  Rule 702. (1) A request for hearing must meet all of the following requirements:

   (a) Be in writing.

   (b) State the name, current address, and current telephone number of the petitioner.

   (c) State in detail the reasons why, and the facts upon which the petitioner will rely on to show that, the petitioner's application for a license should not have been denied, the license should have been renewed, the transfer of ownership should have been approved, the petitioner should not have been placed on the exclusion list, or approval should have been granted.

   (d) Be signed, verified, and dated. A petitioner must shall have the verification notarized and include a certification stating, “Under the penalty of perjury, the undersigned has examined this request for hearing and to the best of my knowledge and belief, it is true, complete, and correct.”

  (2) A request for hearing must be submitted within 21 days after service of an order, a notice the notice of denial, notice of nonrenewal, exclusion, or disapproval. A request for a hearing submitted by certified mail or overnight express mail will be is considered timely deemed submitted in a timely manner if it is postmarked not later than 21 days after service of an order, a notice of denial, notice of nonrenewal, exclusion, or disapproval.

  (3) A request for a hearing is deemed determined granted unless denied.

  (4) Once a request for a hearing is granted, the executive director will shall assign a title and case number to the matter.

  (5) A request for a hearing may be withdrawn by the petitioner. If the request for hearing is withdrawn, then the initial denial, non-renewal, placement on the exclusion list, or disapproval becomes a final board order.

  (6) Unless the board denies a request for hearing, the board will shall submit the request for hearing to the appropriate state agency, and a hearing will must be conducted in accordance with the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.

  (7) Default judgment or dismissal may result at any stage of the proceeding.

R 432.1811 Live gaming device table requirements.

  Rule 811. (1) All of the following minimum requirements apply to a live gaming

device:

   (a) A live gaming device shall must be capable of having a drop box attached to it that is in compliance complies with all of the following requirements:

   (i) The box has 1 lock that secures the contents of the drop box.

   (ii) The box has a separate lock that attaches the drop box to the live gaming device. The keys to the lock securing the contents of the drop box and attaching the drop box to the live gaming device shall must be separate.

   (iii) The box has a slot opening through which currency, coins, tickets, chips, forms, records, and documents can be inserted into the drop box.

   (iv) The box shall must be equipped with a mechanical device that automatically closes and locks the slot opening upon removal of the drop box from the live gaming device.

   (v) The box is attached to the live gaming device table at which where the dealer is located or at another location approved by the board.

   (vi) The box has the live gaming device table number to which the drop box is attached printed on the drop box. The imprinted information shall must be clearly visible.

   (b) A live gaming device shall must be capable of having a tip box attached to it for the deposit of tips and gratuities received by the dealer. The tip box shall must comply be in compliance with all of the following requirements:

   (i) Be a transparent container.

(ii) Be capable of being locked.

   (iii) Be capable of being secured to the table by means of a chain, a lock, or the equivalent. If the tip box is attached by means of a lock, then the key to remove the tip box from the table shall must be separate from the key that opens the tip box.

   (iv) Be attached to the live gaming device table at which where the dealer is located or at another location approved by the board.

   (c) A casino licensee may have emergency drop boxes to replace the drop boxes on a temporary basis. The emergency drop boxes shall must comply be in compliance with the requirements in this rule and an emergency drop form must be used for all emergency drops. and shall have the word "EMERGENCY" clearly printed on the boxes.

(2) Nothing in these rules prohibits using electronic progressive or bonusing equipment in conjunction with play on a live gaming device.

(3) Nothing in these rules prohibits using electronic equipment to monitor or assist in the conduct of a live game.

R 432.1839  Board approval of EGDs; EGD specifications and requirements.

  Rule 839. (1) An EGD proposed for use in a casino must meet the specifications set forth in these rules or other technical specifications adopted by the board in an order or resolution. Any amendments to these rules changing EGD standards shall do not apply to EGDs previously approved by the board unless the board withdraws approval of the previously approved EGD using the process described in these rules.

(2) An EGD must be approved in writing by the board prior to before being used by the casino licensee.

(3) In the process of evaluating EGDs prior to before being used in the casino, the board may do all any of the following:

   (a) Require the applicant or licensee who requests approval of an EGD to submit the EGD to the board for evaluation.

   (b) Employ the services of an outside gaming test laboratory to conduct testing.

   (c) Charge a fee to the applicant or licensee for the submission, evaluation, and any testing performed.

  (4) EGDs submitted to the board for approval must be accompanied by a technically accurate description and explanation of the EGD and its intended use. The information must be submitted in a manner and form prescribed by the board. The applicant or licensee requesting approval shall must provide any information, equipment, or assistance requested by the board.

  (5) The board may require the applicant to deliver 2 working models of the gaming equipment for evaluation. The board may dismantle the EGD and may destroy the electronic components in order to fully evaluate the submission.

  (6) Verify and release programs are not required to be submitted for review, unless specified by the board. Verify and release programs include, but are not limited to, the following:

(a) Bill validator firmware.

   (b) Printer firmware.

   (c) RAM clear programs.

   (d) Diagnostic programs.

(7) EGD software submissions must include documentation that individually lists all submitted items, along with corresponding verification signatures that are reported when using the game authentication terminal (GAT) verification program or equivalent.

(8) All Both of the following provisions apply to calculation sheets:

(a) For each submitted EGD game program, the applicant or licensee requesting approval shall must supply calculation sheets that determine the theoretical payback percentage, including base game, bonus games or features, free games, double-up options, progressives, and any other game features included in the payback percentage calculation.

   (b) Where different player options such as number of credits, lines bet, or player strategy cause the pay table to vary, a separate calculation for each option is required.

  (9) The applicant or licensee must shall submit the EGD source code and any special tool, computer equipment, compiling program, or other technical assistance necessary to compile the submitted software. The result of the compiled source code shall must be identical to that in the storage medium submitted for evaluation. The applicant or licensee must shall provide the board with a method to compensate for or resolve any differences between the compiled program and the submitted program.

(10) EGD general specifications are as follows:

   (a) An EGD must be controlled by a microprocessor.

   (b) An EGD must be equipped with a RNG to make the selection process.

   (c) An EGD must have a random selection process.

   (d) An EGD must be capable of connecting to and communicating with an approved casino critical computerized system. An EGD must be capable of reporting all required electronic digital storage meters as well as and all tilt and error conditions to the approved casino critical computerized system.

   (e) An EGD that is capable of bidirectional communication with internal or external equipment must use a communication protocol that ensures that erroneous data or signals will not adversely affect the operation of the EGD or any attached equipment.

   (f) An EGD must clearly display applicable rules of play and the payout schedule. The rules of play must be displayed on the face or screen of the EGD. If displayed on the face of the machine, the rules must be kept maintained under glass or another transparent substance.

   (g) An EGD must display an accurate representation of each game outcome utilizing rotating reels, video monitors, or other type of display mechanism that accurately depicts the outcome of the game.

   (h) After selection of the game outcome, the EGD must not make a secondary decision that affects the result shown to the player.

   (i) When a bonus game or feature is triggered, auto-initiation of the bonus game or feature by the EGD itself is prohibited, except under the following circumstances:

   (i) The player is presented with a choice and specifically acknowledges his or her their intent to have the EGD auto-initiate the bonus or feature by means of a button press or physical player interaction with the machine.

   (ii) The bonus or feature provides only 1 choice to the player, such as “press button to spin wheel.” In this case, the EGD may auto-initiate the bonus or feature after a time out period of at least 2 minutes.

   (j) If an EGD has the capability of auto-initiating the bonus or feature, the mechanism by which the auto-initiation is implemented must be explained in the pay table and help screens, if help screens are a feature of the particular game. For non-video devices or devices with the pay table displayed on glass, the auto-initiation mechanism must be explained on the glass.

   (k) An EGD that offers progressive awards must have all of the following functionality within the control program itself or an attached progressive controller:

 (i) The ability to display, for each progressive level, the total number of progressive wins, the dollar amount of the last progressive win, and the total dollar amount awarded.

   (ii) The ability to display, for each progressive level, a chronological win history of not less than 10 progressive win events. The win history events must include, at a minimum, the date and time of the progressive award, the progressive level that was awarded, and the dollar amount of the award.

   (iii) The ability to set or override the current progressive amount for all progressive levels.

   (l) An EGD must be designed in a manner that prohibits the enabling and operation of any pay table, feature, bonus round, or any other aspects of game operation that does not meet the jurisdictional requirements set forth in this rule or other technical standards issued by the board.

  (11) All of the following apply to the EGD control program:

   (a) Except as otherwise approved by the board in writing, the control program must reside in the EGD and must be contained in either of the following:

   (i) in a A storage medium that is not alterable through use of the circuitry or programing of the EGD itself., or

   (ii) on a A storage medium that employs a mechanism to prevent any alteration of the control program and all critical files through use of the circuitry or programming of the EGD.

   (b) The control program must be impervious to influences from outside the EGD, including, but not limited to, all of the following:

 (i) Electromagnetic interference.

   (ii) Electrostatic interference.

   (iii) Radio frequency interference.

   (c) The EGD must use appropriate communication protocols to protect the control program from unwanted influence by equipment that is conducting data communications with the EGD.

   (d) EGD control programs must test themselves for possible corruption caused by failure of the program storage media. The test methodology must detect 99.99% of all possible failures. The control program must allow for the EGD to be continually tested during game play. The control program must check for all of the following:

 (i) Corruption of RAM locations used for crucial EGD functions.

  (ii) All required information relating to the game recall history as outlined in this rule.

   (iii) RNG outcome.

 (iv) Error states.

(e) Detection of corruption is a game malfunction that must result in a tilt condition that identifies the error and causes the EGD to cease further function.

   (f) An EGD control program must routinely perform all both of the following self-verification functions:

  (i) Employ a verification mechanism that verifies that all program components are authentic copies. The verification method must prevent the execution of any program component if the component is determined to be invalid, and must cause the EGD to cease further function by means of a tilt.

  (ii) Employ a mechanism that tests unused or unallocated areas of any alterable media for unintended programs or data and test the structure of the storage media for integrity. The mechanism must cause the EGD to cease operation by means of a tilt if unexpected data or structural inconsistencies are found.

  (12) The applicant or licensee must shall submit the EGD RNG to the board for approval under any of the following circumstances:

   (a) The source code of a previously approved RNG has changed or the implementation of the RNG has changed.

   (b) The RNG is new or was not previously board approved.

   (c) The RNG is being implemented on a new hardware platform with a new microprocessor.

  (13) The applicant or licensee must shall submit the following for all EGD RNG submissions:

   (a) The internal RNG test data and analysis detailing the types of tests performed and the results of the testing, certifying compliance with the specifications set forth in this rule or another standard adopted by the board.

   (b) Upon On request, all hardware and software necessary to collect the random number data. Direct collection of the random number data from the actual submitted EGD is required unless it is not possible. If direct collection from the actual submitted EGD is not possible, an external random data generation method may be used if found acceptable by the board.

   (c) Explanation of any differences between the test application and the production application if generating random data with an external test application.

   (d) RNG selection parameters, including the number of selections made per game and the range of numbers used.

   (e) Description of the RNG, including the type, seeding method, and seeding frequency.

  (14) Specifications for RNG data collection or generation are as follows:

   (a) Test software must allow the tester to specify the amount and range of random numbers that will be are generated.

   (b) The test software must output an unsorted ASCII text file of unsigned integers, 1 per line, with no additional characters or leading zeros.

   (c) The output file must be able to be extracted to a removable storage device or be sent via a communication port to an external PC.

  (15) The following EGD RNG requirement provisions apply to randomness events and randomness testing:

   (a) Events in EGDs are occurrences of elements or particular combinations of elements that are available on the particular EGD.

   (b) A random event has a given set of possible outcomes that has a given probability of occurrence called the distribution.

   (c) Two events are called independent if both of the following conditions exist:

  (i) The outcome of 1 event does not have an influence on the outcome of the other event.

   (ii) The outcome of 1 event does not affect the distribution of another event.

   (d) The RNG in an EGD must produce game plays that are random and independent, so that a future game outcome cannot be predicted by a previous game outcome.

   (e) A selection process is considered random if all of the following specifications are met to the 95% confidence level or better:

   (i) The RNG passes the standard chi-squared analysis.

 (ii) The RNG does not produce a statistic with regard to producing patterns of occurrences, as determined by a runs analysis or similar pattern testing statistic (runs analysis or similar pattern testing statistic).

   (iii) The RNG produces numbers that are independently chosen without regard to any other symbols produced during that play, as determined by correlation analysis testing (correlation analysis).

   (iv) The RNG produces numbers that are chosen without reference to the series of outcomes in the previous game, as determined by serial correlation analysis testing (serial correlation analysis).

   (f) The RNG and random selection process must be impervious to influences from outside the EGD, including, but not limited to, all of the following:

   (i) Electromagnetic interference.

  (ii) Electrostatic interference.

  (iii) Radio frequency interference.

   (g) An EGD must use appropriate communication protocols to protect the RNG and random selection process from influence by equipment that is conducting data communications with the EGD.

   (h) The RNG must continue to run in the background at all times, whether or not games are being played on the EGD.

(i) When determining if an EGD award, pay table win, bonus game, progressive, or other feature will be awarded, an EGD utilizing any of the following restricted selection processes exclusively to make the determination is prohibited:

(i) Coin based or threshold triggering in which an award has been predetermined to be triggered at a certain point or between 2 points or values and utilizes a pool value, coin in value, threshold value or any other non-random mechanism to determine when the EGD exceeds the predetermined threshold and awards a prize.

(ii) Time based triggering in which an award has been predetermined to be triggered at a specific time or between 2 points in time and utilizes a clock, either internal or external, to determine when the EGD awards a prize.

(v) Any other non-RNG based selection processes, other than player skill, both internal and external to the EGD.

   (ij) If a restricted selection process is utilized, an approved RNG based selection process must also be utilized simultaneously that is capable of triggering the same award, pay table win, bonus game, progressive award, or other feature on every game play. The trigger probability of the restricted selection process and the RNG selection process must be equivalent.

  (16) An EGD must meet all of the following minimum and maximum theoretical percentage pay out requirements during the lifetime of the EGD:

   (a) The EGD must pay out not less than 80% and not more than 100% of the amount wagered, unless otherwise approved by the board.

   (b) The theoretical payback percentage must be determined using standard methods of probability theory. The percentage must be calculated using both the highest and lowest level of skill, where player skill impacts the payback percentage.

   (c) An EGD must not automatically alter pay tables or any function of the device based on internal computation of the actual hold percentage.

   (d) When calculating the minimum theoretical payback percentage of a progressive EGD, only the base or reset amount, which is (the lowest possible amount,) of progressive awards can be used. A progressive EGD must meet or exceed the minimum jurisdictional requirement of 80% payback without the addition of progressive incremental rates.

   (e) Double-up or gamble options must have a theoretical payback percentage of 100% for that feature.

   (f) A skill based bonus game or feature utilizing a player’s physical skill, dexterity, or knowledge to determine or influence an EGD award must include calculations for the lowest and highest level of skill possible.

  (g) An extended play collection (trophy) feature is one where a given award is not attainable on a single game play and a player must collect items or “trophies” over a series of games before winning an award or participating in a bonus round or feature. These features are allowed but, when calculating minimum theoretical payback for an EGD utilizing a collection or trophy feature, contributions from the collection or trophy feature cannot be used to achieve the minimum jurisdictional requirement of 80% theoretical payback

(h)(g) EGD programs designed for tournament or promotional use may have a theoretical payback percentage that exceeds 100%.

(i)(h) An EGD may have multiple percentage settings if the settings do not violate these rules and if the settings are accessed only by software switches approved by the board.

(j)(i) The probability of obtaining any payout on an EGD must be better than 1 in 50,000,000.

(k)(j) Unless otherwise approved by the board in writing and denoted on the pay glass or pay table screen, where the EGD offers a game that is recognizable such as poker, blackjack, roulette, keno, or craps, the same probabilities associated with the live game must be used in the EGD. For example, each side on a die must have a 1 in 6 probability of occurrence.

  (17) All of the following provisions apply to an EGD with multigame features

   (a) An EGD that offers a menu of more than 1 game to the player is considered a multigame. A multigame may have various games with configurable payback percentages.

   (b) In addition to any other requirements or rules, a multigame may be approved by the board if electronic digital storage meters with at least 10 digits are available upon display for each game offered on the menu. Additionally, a multigame must retain the electronic digital storage meters of any games that are installed on the EGD but are not currently available on the menu. The electronic digital storage meters must include credits wagered and credits won, or equivalent.

   (c) If the method of configuring the multigame menu may be accomplished by entering a configuration mode of the device, then the method employed must meet both of the following standards:

   (i) The method has sufficient safeguards to prevent unauthorized access.

   (ii) The method does not result in data loss or corruption of data sent to the casino critical computerized systems.

  (18) All of the following provisions apply to electronic digital storage meters in EGDs:

   (a) Electronic digital storage meters in EGDs must tally totals to at least 10 digits, be capable of rolling over when the maximum value is reached, and have an accuracy rate of at least 99.99%.

   (b) An EGD must be equipped with all of the following electronic digital storage meters:

   (i) A “coin-in” meter that accumulates the total value of all wagers, excluding subsequent wagers of intermediate winnings accumulated during game play sequences, including such as those acquired from “double up” games.

  (ii) A “coin-out” meter that accumulates the total value of all amounts directly paid by the machine as a result of winning wagers, whether the payout is made to a credit meter or by any other means. This meter will must not record amounts awarded as the result of an external bonusing system or a progressive payout.

   (iii) An “attendant paid jackpots” meter that accumulates the total value of credits paid by an attendant resulting from a single winning alignment or combination, the amount of which is not capable of being paid by the machine itself. This does not include progressive amounts or amounts awarded as a result of an external bonusing system. This meter is only to include awards resulting from a specifically identified amount listed in the manufacturer’s par sheet.

   (iv) An “attendant paid cancelled credits” meter that accumulates the total value paid by an attendant resulting from a player-initiated cash-out that exceeds the physical or configured capability of the machine to make the proper payout amount.

   (v) A “bill in” meter that accumulates the total value of currency accepted. Additionally, the machine must have a specific meter for each denomination of currency accepted that records the number of bills accepted of each denomination.

   (vi) A “voucher in” meter that accumulates the total value of all slot machine wagering vouchers accepted by the machine.

   (vii) A “voucher out” meter that accumulates the total value of all slot machine wagering vouchers and payout receipts issued by the machine.

   (viii) A “wagering account transfer in” or “WAT in” meter that accumulates the total value of cashable credits electronically transferred to the machine from a wagering account by means of an external connection between the machine and a cashless wagering system.

   (ix) A “wagering account transfer out” or “WAT out” meter that accumulates the total value of cashable credits electronically transferred from the machine to a wagering account by means of an external connection between the machine and a cashless wagering system.

   (x) A “non-cashable electronic promotion in” meter that accumulates the total value of non-cashable credits electronically transferred to the machine from a promotional account by means of an external connection between the machine and a cashless wagering system.

   (xi) A “non-cashable electronic promotion out” meter that accumulates the total value of non-cashable credits electronically transferred from the machine to a promotional account by means of an external connection between the machine and a cashless wagering system.

  (xii) A “cashable electronic promotion in” meter that accumulates the total value of cashable credits electronically transferred to the machine from a promotional account by means of an external connection between the machine and a cashless wagering system.

   (xiii) A “cashable electronic promotion out” meter that accumulates the total value of cashable credits electronically transferred from the machine to a promotional account by means of an external connection between the machine and a cashless wagering system.

  (xiv) A “coupon promotion in” meter that accumulates the total value of all slot machine coupons accepted by the machine.

   (xv) A “coupon promotion out” meter that accumulates the total value of all slot machine coupons issued by the machine.

   (xvi) A “machine paid external bonus payout” meter that accumulates the total value of additional amounts awarded as a result of an external bonusing system and paid by the slot machine.

   (xvii) An “attendant paid external bonus payout” meter that accumulates the total value of amounts awarded as a result of an external bonusing system and paid by an attendant.

  (xviii) An “attendant paid progressive payout” meter that accumulates the total value of credits paid by an attendant as a result of progressive awards that are not capable of being paid by the machine itself. This meter does not include awards paid as a result of an external bonusing system.

(xix) A “machine paid progressive payout” meter that accumulates the total value of credits paid as a result of progressive awards paid directly by the machine. This meter does not include awards paid as a result of an external bonusing system.

(xx) A “games-played” meter that displays the cumulative number of games played.

(xxi) A “cabinet door” meter that displays the number of times the front cabinet door is was opened.

(xxii) A “drop door” meter that displays the number of times the drop door or bill validator door was is opened.

(xxiii) Any additional meters necessary to fully reconcile transfers to and from the EGD.

(xxiv) Any additional meters required, in writing, by the board.

   (c) An EGD must have electronic digital storage meters that continuously and accurately display to the player all of the following information relating to the current play or monetary transaction:

   (i) The number of credits wagered in the current game.

(ii) The number of credits won in the current game, if applicable.

(iii) The number of credits cashed out or a direct pay from a winning combination.

(iv) The number of credits available for wagering, if applicable.

   (d) An EGD may not have a mechanism that causes any of the required electronic digital storage meters to clear automatically when an error occurs. The required electronic digital storage meters may be cleared only in a manner approved by the board. Required meter readings, when possible, must be recorded before and after the electronic digital storage meter is cleared.

   (e) All electronic digital storage meters must be preserved after a power loss to the EGD and must be maintained for a period of not less than 180 days.

  (19) All of the following provisions apply to game recall requirements:

(a) Unless otherwise approved by the board in writing, an EGD must have the capacity to display a complete play history for the current game and the previous 9 games. The game recall shall must reflect at least the last 50 events of completed bonus games. If a bonus game consists of “x number of events,” each with separate outcomes, each of the “x events”, up to 50, shall must be displayed with its corresponding outcome, regardless of whether the result was a win or loss.

   (b) The EGD game recall must display an indication of all of the following:

(i) The game outcome or representative equivalent.

   (ii) The outcome of any bonus round or feature game.

(iii) All bets placed.

(iv) Credits won or cashed out.

(v) Any error conditions.

   (vi) Any other Other information deemed determined necessary by the board to ensure compliance with the act and these rules.

  (20) All of the following provisions apply to error conditions and malfunctions:

(a) A description of the EGD error codes and their meanings must be contained inside each EGD only if the error codes are required for troubleshooting tilts or malfunctions.

   (b) The following provisions apply to error conditions and automatic clearing. The EGD must be capable of detecting and displaying the error conditions listed below. These error conditions must be automatically cleared by the EGD upon initiation of a new play sequence. The following error conditions apply:

(i) Power reset.

(ii) Door open.

   (iii) Inappropriate coin-in, bill-in, or voucher-in if not automatically returned to the player.

   (c) The following provisions apply to error conditions and clearing by an attendant. The EGD must be capable of detecting and displaying all of the following error conditions that an attendant may clear:

(i) Printer jam or error.

(ii) RAM error.

(iii) Program error.

  (iv) A reel spin error of any type, including an index error condition for rotating reels. The specific reel number must be identified in the error indicator.

   (v) Low RAM battery, for batteries external to the RAM itself, or low power source.

   (d) Except in the case of total memory failure, and if the machine is still operable, an EGD must be capable of continuing the current play with all the current play features after an EGD error condition or malfunction is cleared.

  (21) EGD hardware specifications are as follows:

   (a) An EGD must provide the means for on-demand display of the electronic accounting meters utilizing a key switch on the exterior of the EGD.

   (b) An EGD is not required to have electromechanical meters installed.

   (c)The internal space of an EGD must not be readily accessible when the door is closed.

   (d) An on and off power switch that controls the electrical current to operate the EGD must be located in an accessible place within the interior of the EGD.

   (e) All of the following must be secured inside a separate internal enclosure inside the EGD that is capable of being locked:

(i) Logic boards.

  (ii) Program storage media.

   (iii) RAM.

   (f) An EGD must have its logic boards, computer chips, and any other devices that store memory secured in a locked enclosure, as described in subdivision (e) of this subrule. The board must shall be allowed immediate access to the locked area described in subdivision (e) of this subrule. A casino licensee shall must maintain its keys to EGDs in accordance with the casino licensee’s approved internal controls.

   (g) A light must be installed on the top of the EGD and must automatically illuminate when the door to the EGD is opened or when equipment that may affect the security or operation of the EGD is exposed, if the equipment is physically attached to the EGD.

   (h) A bar-top EGD must have a light alarm or an audio door alarm, or both, installed. The alarm must be designed to activate when the machine is entered.

   (i) An EGD must be Underwriters Laboratories approved or equivalent.

   (j) Electrical and mechanical parts and design principles must not subject a player to physical hazards.

   (k) Spilling conductive liquid on the EGD must not create a safety hazard or alter the integrity or performance of the EGD.

   (l) The power supply used in an EGD must be designed to make minimum leakage of current in the event of an intentional or inadvertent disconnection of the AC power ground.

   (m) An EGD power supply filtering must be sufficient to prevent disruption of the EGD by a repeated switching on and off of the AC power.

   (n) A surge protector must be installed on each EGD.

   (o) An EGD must be capable of maintaining the accuracy of the required electronic meter information and game data after power is discontinued from the EGD.

   (p) After a power failure, the EGD must be able to continue a game without loss of data.

   (q) A hardware switch may not be installed if it alters the pay tables or payout percentages in the operation of the EGD.

   (r) Unless otherwise approved by the board in writing, a hardware switch may only be installed to control any of the following:

(i) Graphic routines.

(ii) Speed of play.

(iii) Sound.

  (iv) Other approved cosmetic play features.

(22) If a bill validator is utilized, the bill validator must be approved by the board

and must meet the following requirements:

   (a) The bill validator must exchange currency, tickets, or vouchers for equal value of EGD credits. If EGD credit is issued, then the player must have has the option of taking the entire amount of credits or utilizing any portion of the registered credits to activate the EGD as a wager.

   (b) A bill validator must have software programs that enable the acceptor to differentiate between genuine and counterfeit bills to a high degree of accuracy.

   (c) A bill validator may be for a single denomination or combination of denominations, including tickets and vouchers.

   (d) A bill validator must be equipped with a drop box to collect the currency, tickets, or vouchers inserted into the bill validator. The drop box must comply with all of the following requirements:

   (i) The drop box must be housed in a locked compartment separate from any other compartments of the EGD.

   (ii) The drop box must be accessible by a key that will accesses only the bill validator drop box and no other areas of the EGD.

  (iii) The drop box must have a slot opening through which currency, tickets, or vouchers can be inserted.

 (iv) The drop box must be identifiable to the EGD from which it was removed.

  (23) Wagering credits available for play must be wagered in the following order:

(a) Non-cashable credits.

   (b) Cashable credits given away by a casino licensee.

(c) All other credits.

R 432.1840  EGD tournaments.

  Rule 840. (1) EGD tournaments may be conducted by the casino licensee.

  (2) All tournament play must be on machines that have been tested and approved in accordance with these rules and for which the tournament feature has been enabled.

  (3) All EGDs used in a single tournament must utilize the same electronics and machine settings.

  (4) EGDs enabled for tournament play must not accept credits in or pay credits out in any manner. The EGDs must utilize credit points only.

  (5) Tournament credits must have no cash value.

  (6) Tournament play must not credit the accounting meters of the machine.

  (7) At the casino licensee's discretion, the casino licensee may establish qualification or selection criteria to limit the eligibility of players in a tournament. Criteria used must be reasonably related to gaming activity.

  (8) The rules of tournament play must be provided to all tournament players and members of the public who request a copy of the rules. All of the following provisions apply to the rules of tournament play:

(a) A casino licensee must submit the rules for a tournament to the board not less than 30 days in advance of the commencement of the tournament or within a shorter time period as the board may designate. The rules of tournament play must include all of the following:

   (ai) The amount of points, credits, and playing time players will begin with.

   (bii) The manner in which that players will receive EGD assignments and how reassignments are to be handled.

   (ciii) How players are eliminated from the tournament and how the winner or winners are to be determined.

   (div) The number of EGDs each player will be is allowed to play.

   (ev) The amount of entry fee for participating in the tournament, if applicable.

   (fvi) The number of prizes to be awarded, if applicable.

   (gvii) An exact description of each prize to be awarded.

   (hviii) Any additional house rules governing play of the tournament.

   (iix) Any procedures deemed determined necessary by the board to ensure compliance with the act and these rules.

(b) A casino licensee must not permit any tournament to be played unless the rules of tournament play have been approved by the board.

(c) Once rules of a tournament have been approved by the board, a casino licensee may offer a tournament utilizing the approved rules at any time. Amendments to approved rules of tournament play must be submitted to the board not less than 30 days before utilizing the amendments or within a shorter time frame as the board may designate. An amendment to the rules of tournament play must not be utilized by the casino licensee until approved by the board.

(d) The rules of tournament play must be provided to all tournament players and members of the public who request a copy of the rules.

R 432.1841  Wide area progressive system authorization.

  Rule 841. (1) A wide area progressive system cannot be linked to another jurisdiction unless the board has approved multijurisdictional gaming for casino licensees. This rule authorizes the use of a wide area progressive system.

  (2) Unless otherwise permitted allowed by the board in writing, each EGD machine on the wide area progressive system must link shall have the same probability of hitting the combination that will awards the progressive jackpot. In addition, each machine on a link shall be located on the licensed premises of 1 casino or a machine may be linked among more than 1 casino if the system, hereinafter referred to as multilink for describing such system, is in compliance with all of the following:

  (3) The wide area progressive system must have all the following:

   (a)The wide area progressive system shall have the ability to monitor entry into the front door of each networked EGD as well as and the logic area of each networked EGD and report it to the wide area progressive central system immediately.

(b) Encryption of all All communication packets between each location and the wide area progressive central system shall be encrypted.

   (c) A progressive EGD must either Either contain or be linked to a progressive display showing the wide area progressive jackpot to all players who are playing a progressive EGD and who may potentially win the wide area progressive jackpot.

   (d) Automated real-time All progressive meter reading data shall be obtained in real-time in an automated fashion. When requested to do so, the wide area progressive system shall must return meter readings on the first device attached to the wide area progressive system within 5 minutes of the meter acquisition request. This limitation shall does not apply to the length of time it takes the wide area progressive central computer system to calculate and print reports, but rather only to the time it takes to gather data used for the process. Manual reading of meter values maymust not be substituted for these requirements.

(e) The ability to A casino licensee utilizing a wide area progressive system shall suspend play on the wide area progressive system if a communication failure in the system cannot be corrected within 24 consecutive hours. If a communication failure occurs in a wide area progressive system, then the supplier licensee operating the wide area progressive operator of the system shall take a reading during the time the wide area progressive system is down to make sure that the jackpot amount is the same at all locations connected to the wide area progressive system when restoring the wide area progressive system.

   (f) A licensee authorized to provide a wide area progressive system shall keep a log of all events for a period of not less than 60 days.

   (g) Wide area progressive jackpot Jackpot verification procedures must shall include the following provisions:

(i) Notification to the board when a progressive jackpot is won before the supplier licensee inspects the EDG with the winning progressive jackpot. When a wide area progressive jackpot is won, the licensee authorized to provide the wide area system shall inspect the machine and the board must be notified prior to inspection. The inspection shall must include examining the EPROM or equivalent electronic storage mediums, the error events received by the wide area progressive central system, and any other data that could reasonably be used to ascertain the validity of the progressive jackpot.

   (ii) The central system shall produce reports Reports that will clearly demonstrate the method of arriving at the progressive jackpot payoff amount. The reports shall must include wagers beginning at the polling cycle immediately following the previous jackpot and will include all wagers up to and including the polling cycle, which includes including the jackpot signal. Wagers before the jackpot signal message is received will be are used in calculating the progressive amount before the current jackpot. Wagers subsequent to after the jackpot signal message being is received will be are used in calculating the progressive amount of the next jackpot.

(iii) A jackpot of more than $100,000.00 may be paid in installments over a period of not more than 25 years if each machine clearly displays the fact that the jackpot will be paid in installments. In addition, the number of installments and time between installments shall be clearly displayed on the face of the machine in plain language that is approved by the board.

(iv)(iii) When 2 Two jackpots that occur in the same polling cycle they are determined deemed to have occurred simultaneously and, therefore, each winner shall receives the full amount shown on the meter, unless another method of resolution has been approved in advance by the board.

   (h) Submission to the board of any wide area progressive system shall occurs in the following 2 phases:

   (i) The initial phase, wherein the underlying gaming devices EGDs and communication hardware are tested and approved or rejected by the board.

   (ii) The on-site testing phase, wherein a field inspection is conducted at the wide area progressive central system computer site as well as and multiple field sites to ensure compliance with the act and these rules. Operation of the wide area progressive system will be is authorized only after the board is satisfied that it the system meets both the initial approval and on-site testing requirements, as well as and any other requirements that the board may impose to assure ensure the integrity, security, and legal operation of the wide area progressive system.

(4)(i) The site where the wide area progressive central computer system is located site shall must be equipped with an noninterruptible uninterruptible power supply, and the wide area progressive central computer system shall must be capable of on-line data redundancy if hard disk peripherals fail during operation.

(5)(j) A supplier licensee authorized to provide a wide area progressive system shall supply reports in the manner and form required in a format approved by the board that support and verify the economic activity on the wide area progressive system.  These reports include, but are not limited to, the following:

 (a) (k) Any licensee authorized to provide a wide area progressive system must supply, as requested, reports and information to the board indicating the amount of, and basis for, the current jackpot amount (the amount currently in play). The reports shall include an An aggregate report and a detail report. The aggregate report shall that shows show only the balancing of the wide area progressive system with regard to system-wide totals.

   (b)The A detailed report shall be in a form that identifies each machineEGD on a polling station and indicates for each EGD machine, summarized by location, the coin-in and coin-out totals as the terms are commonly understood in the industry.

(6) A supplier licensee, when In addition, upon the invoicing a participating casino, of any licensee participating in a wide area progressive system, a licensee shall be given a document printout identifying all of the following:

(i)(a) Each EGD in the wide area progressive machine linked to the system.

(ii)(b) The wagers on by each EGD machine that contributed to the progressive jackpot for the period for which an invoice is remitted.

(iii)(c) Other information required by the board to document the validity of the licensee's participating casino’s contributions to the progressive jackpot amount.

(l)(7) A supplier licensee authorized by the board to provide a wide area progressive system shall obtain written approval from the board for identifying all of the following:

(i)(a) The methods of funding the progressive prize jackpot pool.

(ii)(b) The calculating calculation and receipt of payments from participating casinos licensees.

(iii)(c) The Provisions for equipment and services associated with the wide area progressive system including, but not limited to, software, hardware, servicing, and maintenance of the wide area progressive system.

(m8) In calculating gross receipts, a casino licensee shall deduct its contributions to wide area any progressive jackpots awarded during the month. The deducted amount shall must be listed on the detailed accounting records provided to the casino licensee by the supplier licensee, if applicable, person authorized to provide that provides the wide area progressive system. A casino licensee's contribution is based on the wagered amounts from that casino licensee's EGDs machines on the wide area progressive system, compared to the total amount of coins coins in in on the whole wide area progressive system for the time period or periods between the progressive jackpot or jackpots awarded.

(n) The right to receive the jackpot payments may not be encumbered, assigned, or otherwise transferred by a winner, estate, or heir of a deceased winner, except to the estate or heir of the person upon his or her death. An attempt to make a prohibited transfer may result in the person forfeiting the right to receive future payments.

(o9) Except where prohibited by law, if a casino licensee ceases operations and a wide area progressive jackpot is awarded subsequent to after the last day of the final month of operation of the casino licensee, then the casino licensee may file an amended tax return or make claim for a gaming tax refund based on its the licensee’s contributions to the particular progressive jackpot pool.

(p10) The wide area progressive central monitoring system for the wide area progressive system shall must be located within this state unless otherwise approved in writing by the board. The office containing the wide area progressive central monitoring system shall must be equipped with a surveillance system that has been approved by the board. The supplier licensee authorized to provide a wide area progressive system shall be required to limit access to the wide area progressive central monitoring system room office and keep and maintain an entry and exit log for the office in a manner approved by the board. The board shall must, at all times, have the right to immediate access to the office containing the wide area progressive central monitoring system and access to the system itself.

(q11) The A supplier licensee authorized to provide the a wide area progressive system must shall not allow any individual agent or employee to work on any component of the wide area progressive central system until the individual person has demonstrated that they are the employee or agent is qualified and experienced in the construction, software, hardware, and all internal and external components of the wide area progressive central system and has attained at least a level 2 occupational license from the board.

(r)(12) The supplier licensee authorized to provide a wide area progressive system shall supply a copy of all leases and contractual agreements relating to the wide area progressive system if requested by the board.

(s)(13) The wide area progressive system prize fund, which is (the amount of money contributed by the participating casinos, licensees) shall must be audited, in accordance with generally accepted auditing standards, on for the fiscal year of that the supplier licensee is authorized to provide the wide area progressive system, by an independent accountant licensed by the Michigan state board of accountancy and approved by the board. The report shall must be submitted to the board upon completion of the audit or 90 days after the conclusion of the supplier licensee’s fiscal year, whichever occurs first. The supplier licensee providing the wide area progressive system shall pays for the cost of the audit.

(t)(14) The supplier licensee who is authorized to provides a wide area progressive system must shall maintain, in a restricted account, a reserve consisting of cash, United States government treasury securities, approved debt instruments, or combination of not less than the sum of both of the following:

(i)(a) The aggregate remaining balances owed on all jackpots previously won by patrons through the wide area progressive system.

(ii)(b) An amount sufficient to fully fund the present value of all amounts currently reflected on the progressive meters of the wide area progressive systems.

(315) A supplier licensee that provides of a wide area progressive system shall must not reduce, eliminate, or transfer the amount on a wide area progressive EGD jackpot meter or a wide area progressive EGD jackpot unless 1 of the following circumstances exist:

   (a) A player wins the wide area progressive jackpot.

   (b) The supplier licensee adjusts the wide area progressive EGD jackpot meter to correct a malfunction or to prevent the display of an amount greater than a limit imposed by the board in these rules and the supplier licensee documents the adjustment and the reasons for it and notifies the board in writing as soon as practicable.

   (c) The casino licensee's gaming operations at the an establishment cease for any reason other than a temporary closure where the same casino licensee resumes gaming operations at the same establishment within 30 days.

   (d)The supplier licensee distributes the amount to another wide area progressive EGD jackpot in accordance with the casino licensee’s board approved internal controls.

   (e) The board, for good cause, approves in writing prior to before a transfer, a reduction, elimination, distribution, or procedure not otherwise addressed in this rule or the casino licensee’s internal controls.

R 432.11008  Surveillance system requirements.

  Rule 1008. (1) The surveillance system shall must visually record all of the following:

   (a) Observed criminal activity.

   (b) Arrests or evictions.

   (c) Observed procedural violations by employees.

   (d) Detention of persons.

   (e) Emergency activities capable of being observed by the surveillance system.

   (f) Any other Other activities activity deemed determined necessary by the board to ensure compliance with the act and to ensure protection of the public and the integrity of gaming.

  (2) The surveillance system shall must audibly and visually record count procedures.

  (3) The surveillance department shall observe and visually record all of the following:

   (a) Gaming currency collection.

   (b) Armored car deliveries and pickups in the secured delivery station.

   (c) Main banks, with equipment capable of the following:

  (i) Recording and displaying on a screen a general overview of the activities in each cage and vault area with sufficient clarity to allow identification of patrons and employees.

   (ii) Providing a dedicated view, with sufficient clarity, to identify the currency, coin, and chip values, and the amounts of credit slips and fill slips in any area where fills and credits are transacted.

   (d) Security department offices, through equipment capable of recording and displaying on a screen, both audibly and visually, all activities in any area of the security office where an person individual may be detained and questioned by the security department.

   (e) All detention and questioning of detained individuals by casino security personnel.

   (f) Entrances and exits of the casino and entrances and exits of all of the following rooms in the casino by dedicated camera coverage providing a reasonable opportunity to identify any person using the entrances and exits to:

(i) Count rooms.

  (ii) Vaults.

   (iii) Surveillance rooms.

   (iv) Security rooms.

   (g) On-site maintenance and repair service, which also requires all of the following:

   (i) Surveillance personnel shall be notified of any maintenance or repair of any gaming or money handling equipment.

  (ii) Notation of the service shall must be made in the activity log.

   (iii) Repair shall must be periodically monitored in conjunction with routine monitoring activities to ensure proper controls and procedures are being followed by casino personnel.

   (iv) The provisions of this subdivision paragraph are not applicable to routine operations, such as including jackpot payouts, fills, and jams.

  (4) The surveillance system shall must, by a dedicated camera, continuously record any EGD or group of EGDs that have a possible jackpot payout of more than $100,000.00 $200,000.00 for any single pay line.

R 432.11201  Ownership records.

  Rule 1201. A casino licensee shall keep and provide to the board upon request,

all of the following records:

   (a) If a casino licensee is a corporation, then all of the following records:

  (i) A certified copy of the articles of incorporation and any amendments.

  (ii) A certified copy of the bylaws and any amendments.

  (iii) A certificate of good standing from the state of its incorporation.

  (iv) If the corporation is operating as a foreign corporation in this state Michigan, a certificate of authority from the Michigan corporations and securities bureau in this state authorizing it to do business in this state Michigan.

   (v) A list of all current and former officers and directors for a period of 7 years before Michigan licensure.

   (vi) A certified copy of minutes of all meetings of the stockholders and directors for a period of 5 years before Michigan licensure in this state.

   (vii) A current list of all current stockholders, including the names of beneficial owners of shares held in street or other names.

   (viii) The name of a company and a current list of all stockholders in the company, including the names of beneficial owners of shares held in street or other names, where in which the corporation has a direct, or indirect, or attributed interest.

  (ix) A copy of the stock certificate ledger or its electronic equivalent.

  (x) A complete record of all transfers of stock to the extent available to the licensee or applicant.

  (xi) A schedule of amounts paid to the corporation for the issuance of stock and other capital contributions and the dates the amounts were paid.

  (xii) A schedule of all dividends distributed by the corporation.

   (xiii) A schedule of all direct or indirect salaries, wages, and other remuneration, including prerequisites, paid during the calendar or fiscal year by the corporation to all officers, directors, and stockholders that have an ownership interest, at any time during the calendar or fiscal year, that is more than 5% of the outstanding capital stock of any class of stock.

   (b) If a casino licensee is a limited liability company, then all of the following records:

   (i) A certified copy of the articles of organization.

   (ii) A certified copy of the operating agreement.

(iii) A list of all current and former managers, including names and addresses.

  (iv) A list of the members, including all of the following information:

   (A) Names.

  (B) Addresses.

(C) The percentage of interest in net assets, profits, and distributions of cash held or attributable to each.

   (D) The amount and date of each capital contribution of each member.

  (E) The date the interest was acquired.

   (F) The method of determining a member's interest.

   (v) A schedule of all withdrawals of company funds or assets by members.

   (vi) A schedule of direct or indirect salaries, wages, and other remuneration, including prerequisites, paid to each member during the calendar or fiscal year.

   (vii) A copy of the membership ledger or its electronic equivalent.

  (viii) A complete record of all transfers of membership interests.

  (ix) A schedule of amounts paid to the company for the issuance of membership interests and other capital contributions and the dates the amounts were paid.

   (c) If a casino licensee is a partnership, then all of the following records:

  (i) A certified copy of the partnership agreement.

  (ii) A certificate of limited partnership of its domicile.

  (iii) A list of the partners, including all of the following information:

  (A) Names.

   (B) Addresses.

   (C) The percentage of interest in net assets, profits, and losses held by each partner.

   (D) The amount and date of each capital contribution of each partner.

   (E) The date the interest was acquired. The list shall must also describe the form of the person's partnership interest, for example, limited partner.

  (iv) A schedule of all withdrawals of partnership funds or assets.

  (v) A schedule of direct or indirect salaries, wages, and other remuneration, including prerequisites, paid to each partner during the calendar or fiscal year.

  (d) If a casino licensee is a sole proprietorship, then all of the following records:

   (i) A schedule showing the name and address of the sole proprietor and the amount and date of his or her the sole proprietor’s original investment.

   (ii) A schedule of the dates and amounts of subsequent additions to the original investment and any withdrawals.

(iv)(iii) A schedule of direct or indirect salaries, wages, and other remuneration, including prerequisites, paid to the sole proprietor during the calendar or fiscal year.

R 432.11203  Standard financial and statistical records.

  Rule 1203. (1) A casino licensee, unless specifically exempted by the board, shall file monthly, quarterly, and annual reports of financial and statistical data in a format prescribed by the board.

  (2) The board shall periodically prescribe a set of standard reporting forms and instructions to be used in filing monthly, quarterly, and annual reports.

  (3) The board shall prescribe a uniform chart of accounts, including account classifications, in order to ensure consistency, comparability, and appropriate disclosure of financial information. The prescribed chart of accounts shall must be the minimum level of detail to be maintained for each accounting classification by a casino licensee.

  (4) Annual reports shall must be based on a calendar year beginning January 1 and ending December 31, unless otherwise approved by the board. Quarterly reports shall must be based on the calendar quarters ending March 31, June 30, and September 30. Monthly reports shall must be based on calendar months. Quarterly and monthly reports must shall contain a cumulative year-to-date column in this rule to facilitate analysis.

  (5) The reports required to be filed in this rule shall must be sworn to and signed by the following entities:

   (a) If the reports are from a corporation, then the chief executive officer and 1 of the following entities:

  (i) Financial vice president.

  (ii) Treasurer.

  (iii) Controller.

   (b) If the reports are from a limited liability company, then by a manager.

   (c) If the reports are from a partnership, then by a general partner and financial director.

   (d) If the reports are from a sole proprietorship, then by the sole proprietor.

   (e) If the reports are from any other another form of business association, then by the chief executive officer.

  (6) A report shall must be addressed to the board and postmarked not later than the required filing date. The required filing dates are as follows:

   (a) A monthly report is due on the thirtieth day of the following month.

   (b) A quarterly report is due on the fifteenth day of the second month following the end of the quarter.

   (c) An annual report is due on the fifteenth day of the third month following the end of the year.

  (7) If there is a termination or suspension of the casino license, a voluntary or involuntary change in the company, or a material change in ownership, then a casino licensee shall file an interim quarterly report as of the date the event occurs, unless the event has already been disclosed in a regular quarterly report or unless exempted by the board. The filing date shall must be 30 days after the date the event occurs.

  (8) An adjustment that results from the quarterly and annual audits shall must be recorded in the accounting records. If an adjustment was not reflected in a casino licensee's quarterly or annual reports and if the board concludes that the adjustment is significant, then a revised report may be required from a casino licensee. The revised filing shall be is due within 30 days after written notification to a casino licensee.

  (9) A delay in mailing, mail pickups, and postmarking is the responsibility of the casino licensee.

R 432.11204  Quarterly and annual Annual audits and licensee annual compliance reports.

  Rule 1204. (1) All of the following provisions apply to annual and special audits and other reports:

   (a) In accordance with section 14 of the act, the board shall require quarterly and annual audits of the financial condition of the casino licensee's total operations. An independent certified public accountant who is, or whose firm is, licensed in this the state of Michigan shall perform the quarterly and annual audits. The independent certified public accountant who performs the quarterly and annual audits shall be licensed in this state Michigan.

   (b) The quarterly and annual audits shall must be performed and presented in accordance with generally accepted accounting principles and contain the opinion of the independent certified public accountant as to its fair preparation and presentation in accordance with generally accepted accounting principles.

   (c) To assure ensure the integrity of gaming and compliance with the act and these rules, the board may require a special audit of a casino licensee to be conducted by board personnel or an independent certified public accountant who is, or whose firm is, licensed in Michigan this state. The board shall establish the scope, procedures, and reporting requirements of a special audit.

   (d) An audit required in by this rule and filed with the board shall must, at the same time, be filed with the city.

  (2) The board shall require annual compliance reports to be prepared by the licensee and submitted in a manner and form prescribed by the board. The annual compliance report shall must address all of the following areas:

   (a) Compliance with procedures to ascertain that gross receipts are properly determined and that state and local taxes are paid, in conformity with the act and these rules.

   (b) Compliance with applicable ordinances and agreements with other governmental authorities.

   (c) Compliance with board-approved internal control procedures, accounting procedures, credit procedures, dispute procedures, and board-imposed security and safety requirements.

   (d) A material deviation from the casino licensee's approved internal control procedures, accounting procedures, credit and dispute procedures, and board-imposed security and safety requirements.

   (e) Corrective action taken by the licensee to resolve deficiencies observed in subdivisions (a) to (d) of this subrule.

   (f) Other matters required by the board to measure the licensee's compliance with the act and these rules.

  (3) The board shall determine the date of filing and the number of copies of audits or reports required under this rule. The audits or reports shall must be received by the board or postmarked not later than the required filing date.  Delays in mailing, mail pickups, and postmarking are the responsibility of the casino licensee.

  (4) A casino licensee who that is a public reporting company under the Securities Act of 1933, 15 USC 77a to 77aa, or Securities Exchange Act of 1934, 15 USC 78a to 78qq,

the securities and exchange act of 1933 or 1934, 15 U.S.C. § 77 and 15 U.S.C. § 78 shall submit a copy of all reports required by the Securities and Exchange Commission securities and exchange commission to the executive director in a format prescribed by the board. The reports shall be are due on the same filing dates as required by the Securities and Exchange Commission securities and exchange commission.

  (5) A casino licensee shall bear the expense of preparing an audit which that is required by this rule and which is performed by an independent certified public accountant. Qualified personnel of the casino licensee shall prepare compliance reports and the casino licensee shall bear the expense of preparing the compliance reports.

  (6) The reporting year-end of the holder of a casino license shall must be December 31 unless otherwise approved by the board.

R 432.11602  Maintaining certain information of person an individual on the disassociated

  persons list.

  Rule 1602. (1) Immediately after the board discloses to a casino licensee the identity of an person individual on the disassociated person list, the casino licensee must shall cause that person individual to be identified by name, address, and date of birth, and email address if provided by the board, on all mailing, marketing, and promotion lists maintained by a casino licensee or provided by the casino licensee to a third party as ineligible to receive promotional material.

  (2) A casino licensee must shall not cash checks for, extend credit to, or otherwise assist an person individual on the disassociated persons list in obtaining funds at the cage and shall must maintain and use a system designed to identify whether an person individual who requests such the services is on the board’s disassociated persons list when the person individual provides their his or her name, address, and or date of birth in conjunction with completing such a the transaction.

  (3) Immediately after the board notifies a casino licensee of the removal of an individual on the disassociated persons list, the casino licensee shall remove the disassociated person designation from the casino system.