OAR 177-040-0017
Additional Video Lottery Retailer Application Requirements and Lottery Authority to Prevent and Resolve Concentrations
(1)
General: It is the policy of the Oregon State Lottery to place Video Lottery game terminals in retail businesses which are viable businesses on their own without benefit of selling Video Lottery.(2)
Additional Video Lottery Retail Application Requirements:(a)
If the director or director’s designee has reason to believe an applicant is not a viable business without selling Video Lottery or would otherwise not meet the casino prohibition criteria in OAR 177-040-0061 (Casino Prohibition):(A)
The director or director’s designee may require the applicant to operate the business continuously for up to six months prior to the date the application process is initiated.(B)
The director or director’s designee may require additional documentation and explanation about the applicant’s business operation plans such as, but not limited to, length of experience in the type of business, prior ownership and/or management of businesses in general, sales and profitability projections, and location suitability, as deemed necessary to evaluate the viability of the business.(b)
For the purpose of paragraph (a)(A) of this section, operating continuously means a business is open to the public and makes available for sale all products or services the applicant sells. For purposes of this definition, opening for brief periods of time and/or offering limited products and/or services will be considered an attempt to circumvent the intent of this section and will not be considered as operating continuously.(A)
Interruptions: The continuous period of operation shall not be considered interrupted if any suspension of operations was for two days or less. The intent of this subsection is that there will not be a significant interruption of the business during the continuous period of operation so that the Lottery may reasonably rely on sales information and business history which remains relevant to the application. The Director may find that the continuous period of operation was not interrupted when the suspension of operation is for an aggregate of more than two business days upon a showing by the applicant that the sales information and business history remains relevant.(B)
Purchase: If the substantial assets of a business or premises were purchased by the person applying for a Video Lottery retailer contract within 90 days prior to the date the application process is initiated, the period of operations under the prior owner shall be considered in determining the period of operations, provided that the new business is being operated as the same or similar type of business and the primary business of the prior owner was the offering of meals or alcoholic beverages for on-premise consumption. The intent of this rule section is to prevent evasion of the rule’s requirement by means of superficial transactions such as the mere purchase of a business trade name rather than a bona fide acquisition of the substantial operating assets.(C)
Move: If a business moves to a different location within 90 days prior to the date the application process is initiated, the period of operations at the old location shall be considered if:(i)
The new location is in essentially the same community as the old location and serves essentially the same customer base; and(ii)
The business conducted at the new premises is a continuation of the business conducted at the old premises rather than the establishment of an additional location.(iii)
The burden of proof for establishing subsections (A) and (B) of this subsection is on the applicant.(3)
Managing Video Lottery Retailer Applications to Prevent a Concentration: The Lottery will manage the Video Lottery retailer application process to avoid creating a concentration as defined in OAR 177-045-0000 (Definitions)(1):(a)
The Lottery will not initiate the application process or consider or process an application when the application would, if approved, create a concentration.(b)
When there is an area at risk for a concentration, the Lottery will manage the application process such that no concentration is created. For example, the Lottery will only allow one application to be processed or considered at a time if more than one application would, if approved, create a concentration. In the event that more than one applicant has requested to initiate the application process, the Lottery will use a first come, first serve basis to select among applicants as needed to avoid creating a concentration.(4)
Selection Process Where Concentration of Video Lottery Retailers Exists: If there is a location of existing Video Lottery retailers that creates a concentration of Video Lottery retailers, the director must resolve the concentration by selecting retailer locations to either relocate or terminate their retail contract:(a)
Except as provided in subsection (b) of this section, the director must select as many retailers as needed to relocate or terminate their retail contract based on last-in, first-out, meaning that the retailer locations with the most recently-approved retail contract will be required to relocate or terminate their retail contract to resolve the concentration.
Source:
Rule 177-040-0017 — Additional Video Lottery Retailer Application Requirements and Lottery Authority to Prevent and Resolve Concentrations, https://secure.sos.state.or.us/oard/view.action?ruleNumber=177-040-0017.