The rules contained in this section and the divisions thereunder shall govern qualifications for all types of video gaming licenses issued by the city pursuant to this chapter.
(A) Issuance of license.
(1) (a) The burden is upon each applicant to demonstrate his or her suitability for licensure. Each video gaming terminal operator owning, maintaining, or placing a video gaming terminal in a licensed video gaming location located in the city shall obtain a video gaming terminal license from the Liquor Commissioner for each video gaming terminal in a licensed video gaming location located in the city. Each operator of a licensed video gaming location located in the city where a video gaming terminal is maintained or placed shall obtain a location license from the Liquor Commissioner.
(b) The Liquor Commissioner may issue or deny a license under this chapter to any person pursuant to the same criteria set forth in § 9 of the Riverboat Gambling Act.
(2) The Liquor Commissioner shall not grant a license to a person who has facilitated, enabled, or participated in the use of coin-operated devices for gambling purposes or who is under the significant influence or control of such a person. For the purposes of this Act, “facilitated, enabled, or participated in the use of coin-operated amusement devices for gambling purposes” means that the person has been convicted of any violation of Article 28 of the Criminal Code of 1961 or of Chapter 134 of this code. If there is pending legal action against a person for any such violation, then the Liquor Commissioner shall delay the licensure of that person until the legal action is resolved.
(3) Each person seeking and possessing a license as a video gaming terminal operator or a licensed video gaming location shall submit to a background investigation conducted by the Illinois Gaming Board with the assistance of the State Police or other law enforcement. The background investigation shall include each beneficiary of a trust, each partner of a partnership, and each director and officer and all stockholders of 5% or more in a parent or subsidiary corporation of a video gaming operator or a licensed video gaming location.
(4) Each person seeking and possessing a license as a video gaming terminal operator or a licensed video gaming location shall disclose the identity of every person, association, trust, corporation, or limited liability company having a greater than 1 % direct or indirect pecuniary interest in the video gaming terminal operation for which the license is sought. If the disclosed entity is a trust, the application shall disclose the names and addresses of the beneficiaries; if a corporation, the names and addresses of all stockholders and directors; if a limited liability company, the names and addresses of all members; or if a partnership, the names and addresses of all partners, both general and limited.
(5) No person may be licensed as a video gaming terminal operator or a licensed video gaming location if that person has been found by the Illinois Gaming Board to:
(a) Have a background, including a criminal record, reputation, habits, social or business associations, or prior activities that pose a threat to the public interests of the state or to the security and integrity of video gaming;
(b) Create or enhance the dangers of unsuitable, unfair, or illegal practices, methods, and activities in the conduct of video gaming; or
(c) Present questionable business practices and financial arrangements incidental to the conduct of video gaming activities.
(6) Any applicant for any license under this chapter has the burden of proving his or her qualifications to the satisfaction of the Liquor Commissioner. The city may adopt rules to establish additional qualifications and requirements to preserve the integrity and security of video gaming in the city.
(B) Precondition for licensed location. In all cases of application for a licensed location, to operate a video gaming terminal, each licensed video gaming location shall possess a valid state license for a video gaming location, a valid liquor license issued by the Illinois Liquor Control Commission and a valid local liquor license issued by the city Liquor Commissioner in effect at the time of application and at all times thereafter during which a video gaming terminal is made available to the public for play at that location. Video gaming terminals in a licensed video gaming location within the city shall be operated only during the same hours of operation generally permitted to holders of a license under the provisions of this code adopted pursuant to the Liquor Control Act of 1934.
(C) Insurance. Each terminal operator shall maintain liability insurance on each video gaming terminal that it places in a licensed video gaming location in an amount set by the Illinois Gaming Board.
(D) Minimum requirements for licensing and registration. Every video gaming terminal offered in the city for play shall first be tested and approved pursuant to the rules of the Illinois Gaming Board, and each video gaming terminal offered in the city for play shall conform to an approved model. Every video gaming terminal offered in the city for play must meet minimum standards set by an independent outside testing laboratory approved by the Illinois Gaming Board. Each approved model shall, at a minimum, meet the following criteria:
(1) It must conform to all requirements of federal law and regulations, including FCC Class A Emissions Standards.
(2) It must theoretically pay out a mathematically demonstrable percentage during the expected lifetime of the machine of all amounts played, which must not be less than 80%. The maximum payout percentage for approved models shall conform to the requirements established by the Illinois Gaming Board by rule. Video gaming terminals that may be affected by skill must meet this standard when using a method of play that will provide the greatest return to the player over a period of continuous play.
(3) It must use a random selection process to determine the outcome of each play of a game. The random selection process must meet 99% confidence limits using a standard chi-squared test for (randomness) goodness of fit.
(4) It must display an accurate representation of the game outcome.
(5) It must not automatically alter pay tables or any function of the video gaming terminal based on internal computation of hold percentage or have any means of manipulation that affects the random selection process or probabilities of winning a game.
(6) It must not be adversely affected by static discharge or other electromagnetic interference.
(7) It must be capable of detecting and displaying the following conditions during idle states or on demand: power reset; door open; and door just closed.
(8) It must have the capacity to display complete play history (outcome, intermediate play steps, credits available, bets placed, credits paid, and credits cashed out) for the most recent game played and ten games prior thereto.
(9) The theoretical payback percentage of a video gaming terminal must not be capable of being changed without making a hardware or software change in the video gaming terminal, either on site or via the centra! communications system.
(10) Video gaming terminals must be designed so that replacement of parts or modules required for normal maintenance does not necessitate replacement of the electromechanical meters.
(11) It must have nonresettable meters housed in a locked area of the video gaming terminal that keep a permanent record of all cash inserted into the machine, all winnings made by the video gaming terminal printer, credits played in for video gaming terminals, and credits won by video gaming players. The video gaming terminal must provide the means for on-demand display of stored information as determined by the Illinois Gaming Board.
(12) Electronically stored meter information required by this section must be preserved for a minimum of 180 days after a power loss to the service.
(13) It must have one or more mechanisms that accept cash in the form of bills. The mechanisms shall be designed to prevent obtaining credits without paying by stringing, slamming, drilling, or other means. If such attempts at physical tampering are made, the video gaming terminal shall suspend itself from operating until reset.
(14) It shall have accounting software that keeps an electronic record which includes, but is not limited to, the following: total cash inserted into the video gaming terminal; the value of winning tickets claimed by players; the total credits played; the total credits awarded by a video gaming terminal; and pay back percentage credited to players of each video game.
(15) It shall be linked by a central communications system to provide auditing program information as approved by the Illinois Gaming Board. The central communications system shall use a standard industry protocol, as defined by the Gaming Standards Association, and shall have the functionality to enable the Illinois Gaming Board or its designee to activate or deactivate individual gaming devices from the central communications system. In no event may the communications system approved by the Illinois Gaming Board limit participation to only one manufacturer of video gaming terminals by either the cost in implementing the necessary program modifications to communicate or the inability to communicate with the central communications system.
(16) It shall display Amber Alert messages, should the Illinois Gaming Board, in its discretion, require video gaming terminals to display Amber Alert messages.
(17) It shall comply with such rules which establish additional criteria to preserve the integrity and security of video gaming as the Illinois Gaming Board may adopt.
(E) Qualifications for licensure.
(1) In addition to the qualifications required in the Video Gaming Act, the regulations promulgated under the Video Gaming Act or this chapter, the Liquor Commissioner may not grant any video gaming license until the Liquor Commissioner is satisfied that the applicant is:
(a) A person of good character, honesty and integrity;
(b) A person whose background, including criminal record, reputation and associations, is not injurious to the public health, safety, morals, good order and general welfare of the people of the state or the city;
(c) A person whose background, including criminal record, reputation and associations, does not discredit or tend to discredit the Illinois gaming industry, the state or the city;
(d) A person whose background, including criminal record, reputation, habits, social or business associations does not adversely affect public confidence and trust in gaming or pose a threat to the public interests of the state, the city or to the security and integrity of video gaming;
(e) A person who does not create or enhance the dangers of unsuitable, unfair or illegal practices, methods and activities in the conduct of video gaming;
(f) A person who does not present questionable business practices and financial arrangements incidental to the conduct of video gaming activities or otherwise;
(g) A person who, either individually or through employees, demonstrates business ability and experience to establish, operate and maintain a business for the type of license for which application is made;
(h) A person who does not associate with, either socially or in business affairs, or employ persons of notorious or unsavory reputation or who have extensive police records, or who have failed to cooperate with any officially constituted investigatory or administrative body; and
(i) A person who has not had a gaming license revoked in any other jurisdiction.
(2) In addition to all other qualifications required in the Video Gaming Act, the regulations promulgated under the Video Gaming Act or this chapter, the Liquor Commissioner may not grant a video gaming terminal license until the Liquor Commissioner is satisfied that the applicant:
(a) Is a person who demonstrates adequate financing for the business proposed. The Liquor Commissioner shall consider whether any financing is from a source that meets the qualifications in division (E)(1)(a) through (i) of this section and is in an amount sufficient to ensure the likelihood of success in the performance of the licensee’s duties and responsibilities pursuant to the Video Gaming Act, the regulations promulgated under the Video Gaming Act or this chapter; and
(b) Has disclosed all persons with significant influence or control over the applicant or licensee.
(3) Past participation in video gaming.
(a) The Liquor Commissioner shall not grant a license to a person who has facilitated, enabled or participated in the use of coin-operated amusement devices for gambling purposes on or after December 16, 2009, or who is under the significant influence or control of such a person.
(b) The Liquor Commissioner has discretion not to grant a license to a person who, before December 16, 2009, has facilitated, enabled or participated in the use of coin-operated amusement devices for gambling purposes, or who is under the significant influence or control of such a person.
(F) Persons with significant influence or control.
(1) The Liquor Commissioner shall identify each person that holds a position or level of influence over or control in each applicant or licensee that is significant to the regulatory concerns and obligations of the Liquor Commissioner for the specified applicant or licensee.
(2) Each person identified as a person with significant influence or control shall comply with the following:
(a) Cooperate fully with any investigation conducted by or on behalf of the Liquor Commissioner;
(b) Comply with the Video Gaming Act, the regulations promulgated under the Video Gaming Act or this chapter; and
(c) Submit initial and annual disclosure information on forms provided by the Illinois Gaming Board and the city.
(3) Persons with significant influence or control include, but are not limited to, the following:
(a) Each person in whose name the liquor license is maintained for each licensed video gaming location;
(b) Each person who, in the opinion of the Liquor Commissioner, has the ability to influence or control the activities of the applicant or licensee or elect a majority of its board of directors, other than a bank or other licensed lending institution that holds a mortgage or other lien, or any other source of funds, acquired in the ordinary course of business;
(c) Persons having the power to exercise significant influence or control over decisions concerning any part of the applicant’s or licensee’s video gaming operation.
(Ord. 12-22, passed 4-24-12)