54 N.J.R. 862(a)

VOLUME 54, ISSUE 10, MAY 16, 2022
RULE PROPOSALS

Reporter
54 N.J.R. 862(a)
NJ - New Jersey Register  >  2022  >  MAY  >  MAY 16, 2022  >  RULE PROPOSALS  >  LAW AND PUBLIC SAFETY -- DIVISION OF CONSUMER AFFAIRS

Interested Persons Statement 

INTERESTED PERSONS 
Interested persons may submit comments, information or arguments concerning any of the rule proposals in this issue until the date indicated in the proposal. Submissions and any inquiries about submissions should be addressed to the agency officer specified for a particular proposal. 
The required minimum period for comment concerning a proposal is 30 days. A proposing agency may extend the 30-day comment period to accommodate public hearings or to elicit greater public response to a proposed new rule or amendment. Most notices of proposal include a 60-day comment period, in order to qualify the notice for an exception to the rulemaking calendar requirements of  N.J.S.A. 52:14B-3. An extended comment deadline will be noted in the heading of a proposal or appear in a subsequent notice in the Register. 
At the close of the period for comments, the proposing agency may thereafter adopt a proposal, without change, or with changes not in violation of the rulemaking procedures at      N.J.A.C. 1:30-6.3. The adoption becomes effective upon publication in the Register of a notice of adoption, unless otherwise indicated in the adoption notice. Promulgation in the New Jersey Register establishes a new or amended rule as an official part of the New Jersey Administrative Code. 
Agency


LAW AND PUBLIC SAFETY > DIVISION OF CONSUMER AFFAIRS > LEGALIZED GAMES OF CHANCE CONTROL COMMISSION

Administrative Code Citation


Proposed Amendments: N.J.A.C. 13:3-1.1, 1.5, 1.7, 1.13, 2.2, and 7.9  
Proposed New Rule: N.J.A.C. 13:3-7.10
Text

 Electronic Gaming in Bowling Alleys and International Air Terminals

Authorized By: Legalized Games of Chance Control Commission, Karl Reidel, Executive Officer.
Authority: N.J.S.A. 5:8-79.
Calendar Reference: See Summary below for explanation of exception to calendar requirement.
Proposal Number: PRN 2022-069.
Submit comments by July 15, 2022, to:

Legalized Games of Chance Control Commission
c/o Karl Reidel, Executive Officer
124 Halsey Street
PO Box 46000
Newark, New Jersey 07101
or electronically at:

http://www.njconsumeraffairs.gov/Proposals/Pages/default.aspx.

The agency proposal follows:
Summary
P.L. 2017, c. 47, and P.L. 2017, c. 152, amend various aspects of the amusement games licensing laws. Among other things, these laws (1) expand the definition of "recognized amusement park" at N.J.S.A. 5:8-101 to include businesses that offer "electronic amusements"; (2) amend N.J.S.A. 5:8-78.2 to permit qualifying bowling alleys to obtain amusement games licenses; and (3) permit qualifying bowling alleys and entities within certain international airport terminals to hold both an alcoholic beverage license and an amusement games license pursuant to N.J.S.A. 5:8-78.2 and 5:8-101.1, respectively. The Legalized Games of Chance Control Commission (Commission) proposes to amend N.J.A.C. 13:3 to effectuate the provisions at P.L. 2017, c. 47, and P.L. 2017, c. 152.
P.L. 2017, c. 47, and P.L. 2017, c. 152, make the following changes to New Jersey's amusement games licensing laws. First, P.L. 2017, c. 47, makes several changes with respect to "recognized amusement parks" and "electronic amusements." In particular, it amends the definition of "recognized amusement park" to include entities that offer "electronic amusements." The law goes on to define "electronic amusements" and to amend the definition of "skill-based attraction," so that such attractions may be played alone. The law also requires amusement games licensees who offer electronic amusements to establish that these amusements do not violate the requirements at N.J.S.A. 5:8-113, which sets forth various prohibitions on gambling, and that the proposed electronic amusement to be offered and the device sought to be utilized are suitable for use after an appropriate test or experimental period under such terms and conditions as the Commission deems appropriate. The Commission is authorized to use the services of another entity to conduct tests of electronic amusements.
Second, P.L. 2017, c. 152, permits the owner of a bowling alley to obtain an amusement games license, as long as the bowling alley has at least 16 United States Bowling Congress sanctioned bowling lanes and at least 40 amusement games. Games involving the manipulation of a mechanical claw or crane to win prizes cannot make up more than 50 percent of the amusement games at a bowling alley that holds an amusement games license. In addition, a bowling alley that obtains an amusement games license must have a redemption center where players can exchange their tickets for prizes. The redemption center must remain open whenever the bowling alley is open.
Third, P.L. 2017, c. 47, permits the holder of an alcoholic beverage license to obtain an amusement games license, as long as the licensee's premises are located in the post-security checkpoint area of the departure level of an international airport terminal and are at least 20,000 square feet. Similarly, P.L. 2017, c. 152, permits bowling alleys to obtain an amusement games license even if they hold an alcoholic beverage license. Existing N.J.A.C 13:3-1.7 prohibits an alcoholic beverage license holder from obtaining a license to offer amusement games. Consistent with P.L. 2017, c. 47, the proposed amendments and new rule will eliminate that prohibition for qualifying international airport terminals and bowling alleys.
To effectuate these statutory changes, the Commission proposes the following amendments and new rule. First, the Commission proposes several amendments concerning "recognized amusement parks" and "electronic amusements." In particular, the Commission proposes to [page=863] amend N.J.A.C. 13:3-1.1 to revise the definition of "recognized amusement park" to include entities that offer "electronic amusements," and to add new definitions of "electronic amusement" and "skill-based attraction." In addition, N.J.A.C. 13:3-7.9 sets forth the amusement games that the Commission certifies. The Commission proposes to amend this section to recognize a new certification type for electronic amusements that are played on tablet computers or other similar devices and could include electronic or digital versions of games that are already certified at existing N.J.A.C. 13:3-7.9.
Additionally, proposed new N.J.A.C. 13:3-7.10 sets forth procedures for approving electronic amusements. This section requires electronic amusements to be tested by a Commission-approved testing facility. A person seeking approval for an electronic amusement will have to apply to the Commission and pay an application fee of $ 1,000. Applicants will be required to submit electronic amusements to an approved testing facility and pay all costs associated with testing. The facility will determine if the electronic amusement meets Commission requirements and report to the Commission on its findings. The Commission will then notify the applicant as to whether the electronic amusement will be certified. The section states that the Commission will not be liable for damage to the electronic amusements submitted for testing. Approval for an electronic amusement will only apply to that amusement, and any modifications would require prior approval from the Commission. The proposed new rule authorizes the Commission to retain electronic amusements for further testing. A licensee would be responsible for retrieving electronic amusements in the Commission's possession. If a licensee fails to retrieve an amusement after a request from the Commission, the Commission would be authorized to dispose of the amusement.
Second, the Commission proposes several amendments concerning the ability of bowling alleys to obtain amusements games licenses. In particular, it proposes to amend N.J.A.C. 13:3-1.1(b) to recognize that a bowling alley may obtain an amusement games license if it meets the requirements at P.L. 2017, c. 152. In addition, N.J.A.C. 13:3-1.5 requires a municipality to pass an ordinance that declares that either a recognized amusement park exists in the municipality, the municipality is a seashore or other resort, or that the municipality contains a place at which an agricultural fair is held. The Commission proposes to add new N.J.A.C. 13:3-1.5(b), so that this ordinance requirement will not apply to bowling alleys that meet the requirements at P.L. 2017, c. 152. Furthermore, before a municipality can issue an amusement games license, N.J.A.C. 13:3-1.13 requires the municipality to adopt a resolution that indicates that the premises being licensed is an amusement park, the municipality is a seashore or other resort, or the municipality contains a place where agricultural fairs are held. The Commission proposes to amend this section, so that this resolution could indicate that the premises being licensed is a bowling alley that meets the requirements at P.L. 2017, c. 152. Finally, N.J.A.C. 13:3-2.2 sets forth fees for amusement games licenses. The Commission proposes to amend this section to include licensing fees for bowling alleys.
Third, the Commission proposes to amend N.J.A.C. 13:3-1.7 to allow both qualifying bowling alleys and entities within qualifying international airport terminals to hold both alcoholic beverage licenses and amusement games licenses. In particular, the amendments propose to remove the prohibition on an amusement game licensee holding an alcoholic beverage license when the amusement game licensee is at least 20,000 square feet and is located in the post-security checkpoint area of the departure level of an international airport terminal. This prohibition will also not apply when a licensee is a bowling alley with at least 16 sanctioned bowling lanes, a redemption center open at all times the bowling alley is open, and at least 40 amusement games, of which no more than 50 percent are mechanical claw or crane games.
The Commission has determined that the comment period for this notice of proposal shall be 60 days; therefore, pursuant to N.J.A.C. 1:30-3.3(a)5, this notice is excepted from the rulemaking calendar requirement.
Social Impact
The proposed amendments and new rule will have a beneficial impact on entities that seek to offer amusement games at airport terminals or bowling alleys. It will also benefit individuals who seek to participate in amusement games at those settings.
Economic Impact
The proposed amendments and new rule may have a beneficial economic impact on bowling alleys and premises at international airport terminals because the addition of amusement games may attract new customers and generate new revenue from existing customers. The proposed amendments and new rule will impose costs on entities that seek approval of electronic amusements, as they would be required to pay an application fee of $ 1,000 to the Commission and pay the costs associated with testing the electronic amusement. Bowling alleys and premises at international airport terminals that apply for an amusement games license also would be required to pay licensing fees.
Federal Standards Statement
A Federal standards analysis is not required because the proposed amendments and new rule are governed by N.J.S.A. 5:8-79 and are not subject to any Federal requirements or standards.
Jobs Impact
The Commission does not believe that the proposed amendments and new rule will increase or decrease the number of jobs in New Jersey.
Agriculture Industry Impact
The Commission does not believe that the proposed amendments and new rule will have any impact on the agriculture industry in the State.
Regulatory Flexibility Analysis
Any amusement games license holder licensed by the Commission that is a "business which is resident in this State, independently owned and operated and not dominant in its field, and which employs fewer than 100 full-time employees" constitutes a "small business" within the meaning of the Regulatory Flexibility Act, N.J.S.A. 52:14B-16 et seq. (RFA). To the extent an amusement games license holder qualifies as a "small business" pursuant to the RFA, the following analysis applies pursuant to N.J.S.A. 52:14B-19.
The Commission does not believe that amusement games license holders will need to employ any professional services to comply with the requirements of the rulemaking. Furthermore, the costs imposed on small businesses are the same as the costs imposed on any business seeking approval of an electronic amusement, as described in the Economic Impact above. The proposed amendments and new rule impose no reporting or recordkeeping requirements. However, they do impose compliance requirements on entities that seek approval of electronic amusements, as set forth in the Summary above. As the proposed amendments and new rule ensure that amusement games comply with Commission requirements regardless of the size of the entity operating them, no differing compliance requirements are imposed on entities seeking amusement games licenses based on the size of the business.
Housing Affordability Impact Analysis
The proposed amendments and new rule will have an insignificant impact on the affordability of housing in New Jersey and there is an extreme unlikelihood that the proposed amendments and new rule would evoke a change in the average costs associated with housing because the proposed amendments and new rule concern licenses to offer amusement games.
Smart Growth Development Impact Analysis
The proposed amendments and new rule will have an insignificant impact on smart growth and there is an extreme unlikelihood that the proposed amendments and new rule would evoke a change in housing production in Planning Areas 1 or 2, or within designated centers, under the State Development and Redevelopment Plan in New Jersey because the proposed amendments and new rule concern licenses to offer amusement games.
Racial and Ethnic Community Criminal Justice and Public Safety Impact
The Commission has evaluated this rulemaking and determined that it will not have an impact on pretrial detention, sentencing, probation, or parole policies concerning adults and juveniles in the State. Accordingly, no further analysis is required.
[page=864] Full text of the proposal follows (additions indicated in boldface thus; deletions indicated in brackets [thus]):
SUBCHAPTER 1. ISSUANCE OF LICENSES BY MUNICIPAL GOVERNING BODIES
13:3-1.1 Definitions: location of games
(a) The following words and terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise:
. . .
"Electronic amusement" means an amusement offered through an electronic device that allows a player to participate in a game of skill or chance through interaction with the device.
"Recognized amusement park" means a commercially operated permanent business, open to the public at least 31 consecutive days annually, the location of which is designed and themed for the primary purpose of providing participatory amusements incorporating skilled-based attractions, rides, or water slides, licensed, in accordance with N.J.S.A. 5:3-31, et seq., or electronic amusements, and food and merchandise concessions in permanent structures. Nothing in this definition shall prevent a license from being issued in any location that has had a license issued prior to [May 16, 1988] (the effective date of this amendment).
. . .
"Skill-based attraction" means an amusement utilizing a tangible object such as a ball, puck, or other portable object either alone, or in competition, with other on-premises guests, or requiring the exertion of physical, aerobic activity, such as dancing, climbing, running, or jumping rope, or any amusement that is predominantly skill-based and can be played either alone, or in competition, with other on-premises guests.
(b) No amusement games license shall be issued in any municipality unless:
1. (No change.)
2. The premises to be licensed are situated at:
i. A recognized amusement park; [or]
ii. A seashore or other resort but only in that part thereof customarily constituting an amusement or entertainment area according to the customary understanding of these terms in the community; [or]
iii. A place where an association organized for the purpose of holding agricultural fairs and exhibitions [which] that is approved by the State Department of Agriculture holds an agricultural fair and exhibition[.]; or
iv. A bowling alley whose premises include: at least 16 United States Bowling Congress (USBC) sanctioned bowling lanes; a redemption center that is open at all times that the bowling alley is open to the public and at which players may exchange tickets they have won for prizes; and at least 40 amusement games, of which no more than 50 percent are games that allow a player to attempt to win merchandise by manipulating a mechanical claw or crane.
13:3-1.5 Requisites for municipal license
(a) (No change.)
(b) The provisions at (a)1 above shall not apply if the entity applying for a license is a bowling alley that meets the requirements at N.J.A.C. 13:3-1.1(b)2iv.
13:3-1.7 Premises with alcoholic beverage license
(a) (No change.)
(b) An amusement game license may be issued for a premise that holds a plenary retail consumption alcoholic beverage license, if the premise is [at least 20,000 square feet and includes at least 100 amusement games.]:
1. At least 20,000 square feet and includes at least 100 amusement games;
2. At least 20,000 square feet and is located in the post-security checkpoint area of the departure level of an international airport terminal; or
3. A bowling alley whose premises include: at least 16 United States Bowling Congress (USBC) sanctioned bowling lanes; a redemption center that is open at all times that the bowling alley is open to the public and at which players may exchange tickets they have won for prizes; and at least 40 amusement games, of which no more than 50 percent are games that allow a player to attempt to win merchandise by manipulating a mechanical claw or crane.
13:3-1.13 Municipal resolution to authorize licenses
(a) No license shall be issued in any municipality unless and until the issuance thereof has been authorized by a resolution duly adopted by the municipal governing body which resolution shall, among other things, specifically recite:
1. That the premises to be licensed are located in a recognized amusement park in the municipality; [or]
2. That the municipality is a seashore or other resort and that the premises to be licensed are located in an amusement or entertainment area in such resort according to the customary understanding of such terms in the municipality; [or]
3. That the municipality contains a place where an agricultural fair and exhibition is held by an association organized for the purpose of holding agricultural fairs and exhibitions which is approved by the State Department of Agriculture[.]; or
4. That the premise to be licensed is a bowling alley whose premises include: at least 16 United States Bowling Congress (USBC) sanctioned bowling lanes; a redemption center that is open at all times that the bowling alley is open to the public and at which players may exchange tickets they have won for prizes; and at least 40 amusement games, of which no more than 50 percent are games that allow a player to attempt to win merchandise by manipulating a mechanical claw or crane.
(b) (No change.)
SUBCHAPTER 2. ISSUANCE OF LICENSES BY COMMISSION
13:3-2.2 License fees
Application for a State license shall be made upon a form prescribed and furnished by the Commission, accompanied by the requisite fee in money order or certified check drawn to the order of the Legalized Games of Chance Control Commission in such amount as is prescribed [by] at N.J.S.A. 5:8-102 for games at an amusement park, bowling alley, or seashore resort, or other resort, or [by] at N.J.S.A. 5:8-125 for games at an agricultural fair and exhibition.
SUBCHAPTER 7. CERTIFICATION OF PERMISSIBLE GAMES BY COMMISSION
13:3-7.9 Permissible amusement games certifications
(a) Pursuant to P.L. 1959, [c.108] c. 108, and this subchapter there is hereby granted certification of permissibility for licensing of the following amusement games:
1.-9. (No change.)
10. Certification No. 10. An electronic amusement that is a game application played on tablet computers or other similar devices, which may include electronic or digital representations or versions of games certified pursuant to (a)1 through 9 above.
13:3-7.10 Approval of electronic amusements
(a) An electronic amusement certified pursuant to N.J.A.C. 13:3-7.9(a)10 shall not be offered, unless the licensee first establishes, to the satisfaction of the Legalized Games of Chance Control Commission, that the electronic amusement will not violate the provisions of section 14 at P.L. 1959, c. 109 (N.J.S.A. 5:8-113) and that the proposed electronic amusement to be offered and the device sought to be utilized are suitable for use after an appropriate test or experimental period, consistent with (c) below.
(b) A person seeking approval for an electronic amusement certified pursuant to N.J.A.C. 13:3-7.9(a)10 shall submit an application for approval to the Legalized Games of Chance Control Commission on a form provided by the Commission setting forth the name, address, telephone number of a contact person, and such other information as the Commission may require, together with the non-refundable application fee of $ 1,000 payable by check or money order to the order of the Legalized Games of Chance Control Commission.
(c) The Legalized Games of Chance Control Commission shall notify the applicant of the facilities authorized for testing. The applicant shall submit the electronic amusement to one of the [page=865] authorized facilities for testing. Submissions shall include all associated hardware, software, written operating manuals, and technical information in order to allow the testing facility and the Commission to determine whether the electronic amusement complies with applicable requirements established by the Commission. The authorized testing facility shall perform such tests, as shall be necessary, to determine that the electronic amusement meets applicable requirements.
(d) Upon conclusion of testing, the authorized testing facility shall provide the Legalized Games of Chance Control Commission with a report that contains findings, conclusions, and a determination of whether the electronic amusement meets the applicable requirements of the Commission set forth in this chapter.
(e) The Legalized Games of Chance Control Commission shall not be liable for any damage or destruction of an electronic amusement that is submitted for testing pursuant to this section.
(f) The applicant shall pay directly to the authorized testing facility any and all costs associated with testing the electronic amusement.
(g) If granted, approval extends only to the specific electronic amusement approved. Any modification must be approved by the Legalized Games of Chance Control Commission.
(h) Once an electronic amusement certified pursuant to N.J.A.C. 13:3-7.9(a)10 has been approved, the Legalized Games of Chance Control Commission may retain the amusement for further testing and evaluation for, as long as the Commission deems necessary. A licensee shall retrieve the electronic amusement if requested by the Commission at the licensee's expense. Failure to do so will result in the licensee relinquishing its rights to the electronic amusement, and the Commission shall dispose of the electronic amusement, as it deems appropriate.