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48:02:04:01. Criteria for suspension, revocation, and denial of license renewal. The
commission executive director may suspend, revoke, or deny the renewal of a license for any
violation of, or noncompliance with, the provisions of SDCL chapter 42-7A or this title,
excluding a violation of SDCL 42-7A-44.
Source: 16 SDR 27, effective August 18, 1989; 30 SDR 52, effective October 28, 2003.
General Authority: SDCL 42-7A-21(16)(17).
Law Implemented: SDCL 42-7A-21(6), 42-7A-11, 42-7A-44.1, 42-7A-56(3), 42-7A-57.
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48:02:04:03. Hearing on suspension, revocation, denial of license renewal, or
imposition of civil fine. A licensee may request an administrative hearing in the event of
suspension, revocation, or denial of license renewal, or the imposition of civil fines, according to
the provisions of SDCL chapter 1-26. A notice and hearing regarding suspension, revocation,
denial of license renewal, or violations of SDCL chapter 42-7A and this title shall must be
conducted by the commission in accordance with the contested case provisions of SDCL chapter
1-26.
Source: 16 SDR 27, effective August 18, 1989.
General Authority: SDCL 42-7A-4, 42-7A-21.
Law Implemented: SDCL 42-7A-4, 42-7A-21, 42-7A-11, 42-7A-56(3), 42-7A-57, 42-7A-
60(4).
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48:02:05:04. Duties of licensed operators. Specific duties of licensed Licensed operators
are as follows shall:
(1) Promote the placement of machines in licensed establishments and assume primary
responsibility for operation and maintenance of video lottery machines;
(2) Maintain and provide in accordance with chapter 48:02:10, either directly or through a
service agent, an inventory of associated equipment to ensure the timely repair and continued,
approved operation and play of the video lottery machines it operates;
(3) Maintain, in accordance with chapter 48:02:10, all skills necessary for the timely repair and
service of machines and associated equipment to ensure the continued, approved operation of the
machines it operates and require its employees or service agents to maintain the same skills;
(4) Attend all meetings, seminars, and training sessions for the repair and maintenance of
machines and associated equipment required by the lottery the South Dakota Lottery SDCL
chapter 42-7A and this article;
(5) Supervise its employees and the activities of licensed establishments to ensure compliance
with the requirements of this article;
(6) Assume responsibility for the payment to players of credits awarded under arrangements
with licensed establishments where the machines are located;
(7) Assume responsibility for machine and associated equipment malfunctions, including any
claim for the payment of credits arising from malfunctions. An operator's liability is limited to the
number of credits for the game displayed in the game rules and may not exceed one thousand
dollars for any succession of games played;
(8) Notify the lottery South Dakota Lottery of any recurring electronic or mechanical machine
malfunctions or other problems experienced in a particular approved machine model;
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(9) Enter into service contracts for the maintenance and repair of video lottery machines and
associated equipment with qualified service agents under terms and conditions agreed upon by
both parties;
(10) Comply with all Type I technician requirements in § 48:02:10:02.01;
(11) Comply with all Type II technician requirements in § 48:02:10:02.02;
(12) Place video lottery machines in establishments and in numbers to ensure maximum
revenues to the state;
(13) Assume all responsibility for establishing communication between each video lottery
machine and the host system;
(14) Maintain general liability insurance coverage for each machine;
(15) Conduct advertising and promotional activities of the video lottery in accordance with
decency, dignity, and honesty, and good taste that does not reflect adversely on the lottery or the
this state of South Dakota;
(16) Contract only with persons authorized under this title to directly share in revenues
generated from net machine income. Any contracts A contract entered into for the division of
revenues from net machine income must clearly state that the lottery South Dakota Lottery is not
a party to the agreement;
(17) Assume liability for lost or stolen money from machine play. Operators may provide for
the sharing of any loss with the establishment where the machine is located;
(18) Furnish security to the lottery South Dakota Lottery by July first of each year, equal to
one-eighteenth of the state's share of estimated annual net machine income derived from the
operator's video lottery machines, by purchase of a surety bond, deposit in cash, or receipt of an
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irrevocable letter of credit or a certificate of deposit issued by a financial institution in this state
with the lottery South Dakota Lottery endorsed on it as a payee;
(19) Respond to service calls within twenty-four hours from the time of notification by the
establishment; and
(20) Remove all machines from the establishment machine play area that have been out of
service for more than forty-eight hours from the time notice was received by the lottery South
Dakota Lottery; and
(21) Sell approved machines under chapters 48:02:07 and 48:02:08 to other licensed operators.
Source: 16 SDR 27, effective August 18, 1989; 21 SDR 219, effective June 26, 1995; 37 SDR
215, effective May 31, 2011; 49 SDR 51, effective November 27, 2022.
General Authority: SDCL 42-7A-21(17), 42-7A-43.
Law Implemented: SDCL 42-7A-21, 42-7A-43.
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48:02:07:04. Report of test results. After each test has been completed pursuant to §
48:02:07:03, the lottery South Dakota Lottery shall provide the machine manufacturer a report
that contains findings, conclusions, and pass/fail results. The report may contain
recommendations for video lottery machine modifications to bring it into compliance with SDCL
chapter 42-7A and this article. Prior to approving a particular machine model, the lottery South
Dakota Lottery may require a trial period to test the machine in a licensed establishment not to
exceed 60 days for a minimum of twenty-one days. During the trial period, the manufacturer
may not make any modifications to the machine model unless approved by the lottery the South
Dakota Lottery. The lottery South Dakota Lottery shall affix seals to each machine during the
test period.
Source: 16 SDR 27, effective August 18, 1989.
General Authority: SDCL 42-7A-21(10), 42-7A-21(11).
Law Implemented: SDCL 42-7A-40.
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48:02:08:01. Hardware specifications. Each video lottery machine licensed for
placement in the state must meet the following hardware specifications:
(1) Electrical and mechanical parts and design principles may not subject a player to physical
hazards;
(2) A surge protector must be installed on the line that feeds power to the machine. The battery
backup or an equivalent for the electronic meters must be capable of maintaining accuracy of all
information required in SDCL subdivisions 42-7A-37(5) and (6) for one hundred eighty days after
power is discontinued from the machine. The backup device shall must be kept within the locked
logic board compartment;
(3) An on/off switch that controls the electrical current used in the operation of the machine
and any associated equipment must be located in an accessible place within the interior of the
machine;
(4) The operation of each machine may not be adversely affected by static discharge or other
electromagnetic interference;
(5) An electronic or mechanical coin acceptor may be installed on any video lottery machine
approved after July 1, 2003. Each video lottery machine approved after July 1, 2003, may contain
a have:
(a) An electronic or mechanical coin acceptor; and
(b) A bill acceptor that accepts one-dollar bills, five-dollar bills, ten-dollar bills,
twenty-dollar bills, fifty-dollar bills, one hundred-dollar bills, and ticket vouchers. The bill
acceptors may be for any single bill or combination of bills in the denominations listed in this
subdivision and ticket vouchers.
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Approval letters and test reports of the coin and bill acceptors from other state or federal
jurisdictions may be submitted. However, all All coin and bill acceptors are subject to approval by
the lottery South Dakota Lottery;
(6) The internal space of a video lottery machine may not be readily accessible when the front
door is both closed and sealed;
(7) Logic boards and software Eproms (which are computer chips that store memory), must be
in a separate, locked area within the machine;
(8) The cash compartment must be contained in a locked area within or attached to the machine;
(9) No hardware switches may be installed that alter the pay tables or payout percentages in the
operation of a game. Hardware switches may be installed to control graphic routines, speed of
play, and sound;
(10) A single printing mechanism must be capable of printing an original ticket voucher and
retaining a legible copy within the machine or create creating an electronic copy on a self-
contained internal or external medium prior to the continuation of game play. The, with the ticket
voucher must record containing the following information when credits accrued on the video
lottery machine are redeemed for cash:
(a) The number of credits;
(b) The value of the credits in dollars and cents displayed in both alpha and numeric and
written form; and
(c) Any other information required by SDCL 42-7A-37(5);
(11) An unremovable identification plate must appear on the exterior of the machine that
contains the following information regarding the machine:
(a) Manufacturer;
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(b) Serial number; and
(c) Model number;
(12) The rules of play for each game must be displayed on the machine face or screen. The
lottery South Dakota Lottery may reject the rules if they are incomplete, confusing, or misleading.
Each game must also display the credits wagered and the credits awarded for the occurrence of
each possible winning hand based on the number of credits wagered. A video lottery machine may
not allow more than two dollars to be played on a game or award free games or credits in excess
of one thousand dollars per bet.
All information required by this subdivision must be kept under glass or another transparent
substance and at no time may stickers or other removable devices be placed on the machine face;
(13) Equipment must be installed that enables the machine to communicate with the lottery's
South Dakota Lottery's central computer system, as required in SDCL subdivision 42-7A-37(7),
using a communications protocol provided to each licensed manufacturer by the lottery South
Dakota Lottery for the information and control programs approved by the commission; and
(14) The legal age requirement in SDCL 42-7A-48 for a person to play a machine must be
displayed on the machine face under glass or on an unremovable plate on the front exterior of the
machine.
Source: 16 SDR 27, effective August 18, 1989; 17 SDR 51, effective October 8, 1990; 29 SDR
176, effective June 30, 2003; 37 SDR 215, effective May 31, 2011; 39 SDR 100, effective
December 5, 2012; 39 SDR 220, effective June 26, 2013; 49 SDR 51, effective November 27,
2022.
General Authority: SDCL 42-7A-21(10).
Law Implemented: SDCL 42-7A-1(16), 42-7A-21, 42-7A-37, 42-7A-38.
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CHAPTER 48:02:10
MAINTENANCE OF VIDEO LOTTERY MACHINES
Section
48:02:10:01 Training in machine maintenance required prior to placement.
48:02:10:02 Manufacturers and distributors required to provide training.
48:02:10:02.01 Type I technician training requirements.
48:02:10:02.02 Type II technician training requirements.
48:02:10:03 Availability of training.
48:02:10:04 Training requirements.
48:02:10:05 Operators required to have training in service and repair of video lottery machines.
48:02:10:05.01 Repealed.
48:02:10:06 Machines to be maintained in operating condition.
48:02:10:07 Maintenance log forms required, Repealed.
48:02:10:08 Operators required to furnish keys to machines for inspection purposes.
48:02:10:09 Notification of repairs to the logic area.
48:02:10:10 Notification of broken seals on logic board.
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48:02:10:03. Availability of training. Manufacturers and distributors shall notify
operators who have either purchased or expressed interest in purchasing their approved machines
at least three weeks in advance of scheduled training programs.
Training programs to qualify as a Type I technician must be scheduled at locations and
times within the state to accommodate persons needing training. This rule does not mandate the
scheduling of training programs at the location of each business licensed as an operator. Training
may be conducted at the manufacturer's and distributor's principal place of business or at other
locations to accommodate persons applying to qualify as a Type I technician.
Training programs to qualify as a Type II technician are held within the state of South
Dakota with lottery personnel assisting the manufacturer or distributor in the training shall must
be coordinated with the South Dakota Lottery. Training for Type II technicians shall must be
scheduled to accommodate persons needing qualification. Manufacturers and distributors must
shall provide subsequent training and inform operators and the lottery South Dakota Lottery of
new developments in the service and repair of it’s the manufacturer’s machines.
Source: 16 SDR 27, effective August 18, 1989; 21 SDR 219, effective June 26, 1995; 49 SDR
51, effective November 27, 2022.
General Authority: SDCL 42-7A-21(11)(13).
Law Implemented: SDCL 42-7A-2, 42-7A-21.
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48:02:10:04. Training requirements. The manufacturer, and distributor, or South
Dakota Lottery shall administer an examination at the conclusion of the training for Type I or Type
II technicians and recommend for qualification as a Type I technician each person who
successfully completes the training.The lottery shall administer an examination at the conclusion
of the training for Type II technicians and qualify each person as a Type II technician who
successfully completes the training and examination. Manufacturers and distributors shall
maintain a list of the names of operators, employees, and service agents who attend and
successfully complete each training and shall submit the list and examinations to the lottery South
Dakota Lottery. The list must show the name of the person who completed the training;, the type
of technician;, the date and location of the training;, and the manufacturer's name and machine
model for which training was provided.
Source: 16 SDR 27, effective August 18, 1989; 21 SDR 219, effective June 26, 1995; 49 SDR
51, effective November 27, 2022.
General Authority: SDCL 42-7A-21(11)(13).
Law Implemented: SDCL 42-7A-2, 42-7A-21.
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48:02:10:07. Maintenance log forms required. A written maintenance log shall be kept
in each video lottery machine located within the main cabinet access area. Every person,
including lottery personnel, who gains entry into any internal space of a video lottery machine
must sign the log, indicate the time and date of entry, indicate the mechanical meter readings,
and list the areas inspected or repaired. The maintenance log forms must be obtained through the
lottery and retained by operators for a period of three years from the date of the last entry. The
maintenance logs must be available for inspection by the lottery upon request Repealed.
Source: 16 SDR 27, effective August 18, 1989.
General Authority: SDCL 42-7A-21(11) to 42-7A-21(13).
Law Implemented: SDCL 42-7A-21(11) to 42-7A-21(13).
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48:02:12:02. Method of payment. The management of each licensed establishment shall
designate employees authorized to redeem credits on ticket vouchers during the establishment's
hours of operation. Credits must be immediately paid in cash or by check when a player presents
a valid ticket voucher for payment before the close of the business day. No credits may be paid in
tokens, chips, or merchandise.
Source: 16 SDR 27, effective August 18, 1989; 49 SDR 51, effective November 27, 2022.
General Authority: SDCL 42-7A-21(3).
Law Implemented: SDCL 42-7A-21, 42-7A-34, 42-7A-37(5).
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48:02:12:03. Restrictions on payment of credits. Establishments An establishment may
only redeem ticket vouchers only for credits awarded on video lottery machines located on its the
Establishment premises. A ticket voucher must be presented for payment before the close of the
business on the date the ticket voucher was printed. The lottery South Dakota Lottery, the
commission, and the this state of South Dakota are not liable for the payment of credits on valid
winning ticket vouchers.
Source: 16 SDR 27, effective August 18, 1989; 49 SDR 51, effective November 27, 2022.
General Authority: SDCL 42-7A-21(3).
Law Implemented: SDCL 42-7A-21, 42-7A-34.