Bill Text: PA SB211 | 2009-2010 | Regular Session | Amended


Bill Title: Further providing for definitions, for prize limits, for insured games, for limited sales, for recordkeeping, for eligible organizations' use of locations for conducting small games of chance, for separate individual prize limitations, for revocation of licenses and for advertising.

Spectrum: Slight Partisan Bill (Republican 13-7)

Status: (Introduced - Dead) 2009-10-05 - Laid on the table [SB211 Detail]

Download: Pennsylvania-2009-SB211-Amended.html

  

 

PRIOR PRINTER'S NOS. 217, 790

PRINTER'S NO.  1414

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

SENATE BILL

 

No.

211

Session of

2009

  

  

INTRODUCED BY FOLMER, BROWNE, ORIE, KASUNIC, ERICKSON, BOSCOLA, BAKER, STOUT, MUSTO, EARLL, VOGEL, RAFFERTY, O'PAKE, PICCOLA, COSTA, PIPPY, WAUGH, M. WHITE, LEACH, EICHELBERGER, WASHINGTON AND ALLOWAY, FEBRUARY 19, 2009

  

  

SENATOR CORMAN, APPROPRIATIONS, RE-REPORTED AS AMENDED, SEPTEMBER 23, 2009   

  

  

  

AN ACT

  

1

Amending the act of December 19, 1988 (P.L.1262, No.156),

2

entitled, as amended, "An act providing for the licensing of

3

eligible organizations to conduct games of chance, for the

4

licensing of persons to distribute games of chance, for the

5

registration of manufacturers of games of chance, and for

6

suspensions and revocations of licenses and permits;

7

requiring records; providing for local referendum by

8

electorate; and prescribing penalties," further providing for

9

definitions, for prize limits, for insured games, for limited

10

sales, for recordkeeping, for eligible organizations' use of

11

locations for conducting small games of chance, for separate

12

individual prize limitations, for revocation of licenses and

<--

13

for advertising.

14

The General Assembly of the Commonwealth of Pennsylvania

15

hereby enacts as follows:

16

Section 1.  The definition of "daily drawing" in section 3 of

17

the act of December 19, 1988 (P.L.1262, No.156), known as the

18

Local Option Small Games of Chance Act, amended December 19,

19

1990 (P.L.812, No.195), is amended to read:

20

Section 3.  Definitions.

21

The following words and phrases when used in this act shall

22

have the meanings given to them in this section unless the

 


1

context clearly indicates otherwise:

2

* * *

3

"Daily drawing."  A game in which a bona fide member selects

4

or is assigned a number for a chance at a prize with the winner

5

determined by [a] random drawing to take place on the eligible

6

organization's premises [during the same operating day]. The

7

term includes games commonly known as "member sign-in lotteries"

8

and "half-and-half lotteries." Nothing in this act shall be

9

construed to prohibit the carrying over of a jackpot where the

10

winning number has not been entered in the game on a particular

11

operating day. Daily drawing winners may be determined with the

12

aid of a passive selection device or reference to drawings

13

conducted by the department pursuant to the act of August 26,

14

1971 (P.L.351, No.91), known as the State Lottery Law. Daily

15

drawing chances may not be sold for an amount in excess of $1,

16

and no more than one chance per individual may be sold [to an

17

individual during the same operating day.] per drawing. Nothing

18

in this definition shall restrict an eligible organization from

19

conducting more than one drawing per day.

20

* * *

21

Section 2.  Section 5 of the act, amended December 19, 1990

22

(P.L.812, No.195) and October 18, 2000 (P.L.602, No.79), is

23

amended to read:

24

Section 5.  Prize limits.

25

(a)  Individual prize limit.--[The] Except as provided for in

26

subsection (i), the maximum cash value which may be awarded for

27

any single chance shall be [$500] $1,000.

28

(b)  Weekly limit.--No more than [$5,000] $20,000 in cash or

29

merchandise shall be awarded by any eligible organization in any

30

seven-day period. Payouts of less than $26 shall not be counted

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1

toward the weekly limit.

2

(c)  Limit on raffles.--No more than $5,000 in cash or

3

merchandise shall be awarded in raffles in any calendar month.

4

(d)  Exception.--An eligible organization may conduct a

5

raffle and award a prize or prizes valued in excess of [$500] 

6

$1,000 each only under the following conditions:

7

(1)  The licensing authority has issued a special permit

8

for the raffle under section 11.

9

(2)  Eligible organizations shall be eligible to receive

10

no more than two special permits in any licensed year except

11

that volunteer fire, ambulance and rescue organizations shall

12

be eligible to receive no more than three special permits in

13

any licensed year.

14

(3)  Only one raffle may be conducted under each special

15

permit.

16

(4)  The total cash value of all prizes shall be no more

17

than $100,000 per calendar year.

18

(e)  Limit on daily drawings.--Daily drawings shall be

19

governed by the prize [limitations] limitation contained in

20

[subsections (a) and (b)] subsection (a). [An eligible

21

organization shall not conduct daily drawings during a period

22

when a weekly drawing is taking place.]

23

(f)  Exception.--The prize limitation contained in

24

[subsections (a) and (b)] subsection (a) may be exceeded by a

25

daily drawing under the following circumstances: a daily drawing

26

may award a prize where the cash value is in excess of [$500] 

27

$1,000 if such prize is the result of a carryover of a drawing

28

or drawings which resulted from the winning number in such

29

drawing or drawings not being among the eligible entrants in

30

such drawings. Nothing contained herein shall authorize the

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1

prize [limitations] limitation as contained in [subsections (a)

2

and (b)] subsection (a) to be exceeded as a result of a failure

3

to conduct a drawing on an operating day during which chances

4

were sold for a daily drawing or for a daily drawing for which

5

chances were sold in excess of $1 or for which more than one

6

chance was sold to an eligible participant.

7

(g)  Daily drawing and weekly drawing exception.--When a

8

daily drawing or weekly drawing is set up or conducted in such a

9

manner as to pay out or award 100% of the gross revenues

10

generated from such drawing, the limitations contained in

11

subsection (b) shall not apply.

12

(h)  Limit on weekly drawings.--Weekly drawings shall be

13

governed by the prize limitations contained in subsection (b).

14

The prize limitation contained in subsection (b) may be exceeded

15

by a weekly drawing under the following circumstances: a weekly

16

drawing may award a prize where the cash value is in excess of

17

[$5,000] $20,000 if such prize is the result of a carryover of a

18

drawing or drawings which resulted from the winning number or

19

numbers in such drawing or drawings not being among the eligible

20

entrants in such drawings. Nothing contained in this act shall

21

authorize the prize limitations as contained in subsection (b)

22

to be exceeded as a result of a failure to conduct a drawing for

23

a week during which chances were sold for a weekly drawing or

24

for a weekly drawing for which chances were sold in excess of

25

$1. [An eligible organization shall not conduct weekly drawings

26

during a period when a daily drawing is taking place.]

27

(i)  Progressive games.--Progressive games shall be permitted

28

with a maximum cash value of $5,000. Contributions to the pot

29

shall be counted against the limit for the week in which the

30

contribution is made except that when the limit is reached the

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1

amount awarded shall be counted toward the limit only to the

2

extent it was not previously counted toward a prior week's

3

limit. For the purpose of this section, progressive games are

4

those in which a winning ticket awards the ticket holder an

5

additional chance at another game or games.

6

Section 3.  The act is amended by adding a section to read:

7

Section 5.1.  Insured games.

8

Notwithstanding any provision of this act to the contrary, an

9

eligible organization may conduct small games of chance using

10

insured games. Insured games sold by a licensed distributor

11

shall be backed by a valid insurance contract issued by an

12

insurance company licensed to do business in this Commonwealth.

13

Proof of the insurance contract must be provided to the

14

department prior to the game being sold. The license of a

15

distributor and an insurance company issuing a contract for an

16

insured game may be suspended or revoked for failure to pay an

17

award. For the purposes of this section, an insured game is a

18

game in which the distributor or other licensed third party

19

guarantees making the payment on a win of a jackpot.

20

Section 4.  Sections 6 and 9(b) of the act, amended December

21

19, 1990 (P.L.812, No.195), are amended to read:

22

Section 6.  Sales limited.

23

No person shall sell, offer for sale or furnish games of

24

chance for use within this Commonwealth except to an eligible

25

organization or distributor licensed under this act. No game of

26

chance, other than a raffle, sold, offered for sale or furnished

27

for use within this Commonwealth shall contain, permit, depict

28

or designate a prize having a cash value in excess of [$500] 

29

$1,000.

30

Section 9.  Regulations of department.

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1

* * *

2

(b)  Limitation on recordkeeping requirements.--This section

3

shall not be construed to authorize the department to promulgate

4

regulations providing for recordkeeping requirements for

5

eligible organizations which require unreasonable or unnecessary

6

information or a repetitious listing of information. The

7

department shall strive to keep such recordkeeping requirements

8

from being an undue hardship or burden on eligible

9

organizations. Under no circumstances shall the department

10

require the retention of records for a period in excess of two

11

years. Each eligible organization shall report to the department

12

prizes awarded as required by section 335 of the act of March 4,

13

1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

14

Section 5.  Section 10 of the act, amended December 19, 1990

15

(P.L.812, No.195) and October 18, 2000 (P.L.602, No.79), is

16

amended to read:

17

Section 10.  Licensing of eligible organizations to conduct

18

games of chance.

19

(a)  License required.--No eligible organization shall

20

conduct or operate any games of chance unless such eligible

21

organization has obtained and maintains a valid license issued

22

pursuant to this section. Auxiliary groups within eligible

23

organizations shall be eligible to conduct small games of chance

24

using the license issued to the eligible organization provided

25

that the auxiliary group or groups are listed on the application

26

and license of the eligible organization. No additional

27

licensing fee shall be charged for an auxiliary group's

28

eligibility under this act. Auxiliary groups shall not include

29

branches, lodges or chapters of a Statewide organization.

30

(b)  Issuance and fees.--The licensing authority shall

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1

license, upon application, within 30 days any eligible

2

organization meeting the requirements for licensure contained in

3

this act to conduct and operate games of chance at such

4

locations within the county or in such manner as stated on the

5

application as limited by subsection (b.1). The license fee to

6

be charged to each eligible organization shall be [$100] $300,

<--

7

except for limited occasion licenses which shall be [$10] $30.

<--

8

Licenses shall be renewable [annually] on a biennial basis upon

<--

9

the anniversary of the date of issue.

10

(b.1)  Location of small games of chance.--Where there exists

11

a location or premises which is the normal business or operating

12

site of the eligible organization and is owned or leased by that

13

eligible organization to conduct its normal business, that site

14

shall be the licensed premises for small games of chance

15

conducted by the eligible organization. If that location

16

consists of more than one building and the eligible organization

17

wishes to conduct its games in a different building at that

18

location from the one that is listed on its application and

19

license, the eligible organization must notify, in writing, the

20

district attorney and the licensing authority of the change in

21

building site and the dates and times that will be affected.

22

When an eligible organization does not own or lease a specific

23

location to conduct its normal business, that eligible

24

organization may use another eligible organization's premises to

25

conduct its games or may make such other arrangements that are

26

consistent with this act, including, but not limited to, leasing

27

a premise under a written agreement for a rental which is not

28

determined by either the amount of receipts realized from the

29

playing of games of chance nor the number of people attending

30

except that an eligible organization may lease a facility for a

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1

banquet where a per head charge is applied in connection with

2

the serving of a meal. When such eligible organization changes

3

the site of its games from that which is listed on its

4

application and license, the eligible organization must notify,

5

in writing, the district attorney and licensing authority of the

6

change in their games' site and dates and times that will be

7

affected. More than one eligible organization may use the same

<--

8

location, provided that each organization has its own license

9

and that the prize limitations of this act shall apply

10

separately to each organization.

11

(b.2)  Off-premises games of chance.--Notwithstanding any

12

other provisions of this section, an eligible organization may

13

conduct small games of chance at a location off its premises

14

when such games are part of an annual carnival, fair, picnic or

15

banquet held or participated in by that eligible organization on

16

a historical basis. The eligible organization must notify, in

17

writing, the district attorney and licensing authority of the

18

location, date and times of such events where it will be

19

conducting small games of chance.

20

(b.3)  Limited occasion licenses.--Eligible organizations

21

which do not own their own premises or which do not lease a

22

specific location to conduct their normal business may apply for

23

a limited occasion license to conduct small games of chance on

24

not more than three occasions covering a total of seven days

25

during a licensed year. A limited occasion license entitles

26

eligible organizations holding such a license to conduct no more

27

than two raffles during a licensed year where prizes may not

28

exceed the established limits for regular monthly raffles.

29

Holders of limited occasion licenses may not apply or be granted

30

any other license or special permit under this act. No holder of

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1

a regular license or special permit under this act shall apply

2

or be granted a limited occasion license.

3

(b.4)  Gambling facility prohibited.--It shall be unlawful

4

for a person, corporation, association, partnership or other

5

business entity to offer for rent or offer for use a building or

6

facility to be used exclusively for the conducting of small

7

games of chance. It shall also be unlawful for any eligible

8

organization to lease under any terms a facility or building

9

which is used exclusively for the conducting of small games of

10

chance.

11

(c)  Display.--Licenses issued pursuant to this section shall

12

be publicly displayed at the site of the small games of chance.

13

(d)  Operation.--Each licensed eligible organization shall

14

comply with the following restrictions and rules governing the

15

operation of games of chance:

16

(1)  No person under 18 years of age shall be permitted

17

to operate or play games of chance.

18

(2)  No eligible organization shall permit any person who

19

has been convicted of a felony in a Federal or State court

20

within the past five years or has been convicted in a Federal

21

or State court within the past ten years of a violation of

22

the act of July 10, 1981 (P.L.214, No.67), known as the Bingo

23

Law, or of this act to manage, set up, supervise or

24

participate in the operation of games of chance.

25

(3)  No eligible organization shall pay any compensation

26

to any person for conducting any games of chance. Games of

27

chance may only be conducted by managers, officers,

28

directors, bar personnel and bona fide members of the

29

eligible organization.

30

(4)  Games shall be conducted only on the licensed

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1

premises or as otherwise provided by this act.

2

(5)  The eligible organization shall not lease such

3

premises under either an oral or a written agreement for a

4

rental which is determined by either the amount of receipts

5

realized from the playing of games of chance or the number of

6

people attending, except that an eligible organization may

7

lease a facility for a banquet where a per head charge is

8

applied in connection with the serving of a meal. An eligible

9

organization shall not lease such premises from any person

10

who has been convicted of a violation of this act within the

11

past ten years.

12

(6)  Games, other than raffles, daily drawings and weekly

13

drawings, shall be purchased only from manufacturers and

14

distributors approved by the department.

15

(7)  [No] Except as provided in paragraph (7.1), no

16

licensed eligible organization shall permit its premises to

17

be used for small games of chance by another licensed

18

eligible organization at the same time that it is conducting

19

small games of chance on the premises. When a licensed

20

eligible organization is permitting another licensed eligible

21

organization to use its premises for purposes of small games

22

of chance, it must cease the operation of its own small games

23

of chance during the period that the other licensed eligible

24

organization is conducting its games on the premises.

25

(7.1)  A licensed eligible organization may sell on its

26

licensed premises the raffle tickets of another licensed

27

eligible organization that has been issued a limited occasion

28

license under subsection (b.3).

29

(8)  Raffle tickets may be sold off the licensed premise

30

in any municipality in this Commonwealth which has adopted

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1

the provisions of this act by an affirmative vote in a

2

municipal referendum. A licensed eligible organization which

3

plans to sell raffle tickets in a municipality located in a

4

county other than the county in which the eligible

5

organization is licensed must notify that county's district

6

attorney and licensing authority as to the location and the

7

dates that the eligible organization plans to sell raffle

8

tickets.

9

(9)  The eligible organization shall keep a bank account

<--

10

to hold the proceeds of games of chance, which shall be

11

separate from all other funds belonging to the eligible

12

organization. Account records shall show all expenditures and

13

income and shall be retained by the eligible organization for

14

at least two years.

15

(e)  Application for license.--Each eligible organization

16

shall apply to the licensing authority for a license on a form

17

to be prescribed by the Secretary of Revenue. The form shall

18

contain an affidavit to be affirmed by the executive officer or

19

secretary of the eligible organization stating that:

20

(1)  No person under 18 years of age will be permitted by

21

the eligible organization to operate or play games of chance.

22

(2)  The facility in which the games of chance are to be

23

played has adequate means of ingress and egress and adequate

24

sanitary facilities available in the area.

25

(3)  The eligible organization is not leasing such

26

premises from the owner thereof under an oral agreement, nor

27

is it leasing such premises from the owner thereof under a

28

written agreement at a rental which is determined by the

29

amount of receipts realized from the playing of games of

30

chance or by the number of people attending, except that an

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1

eligible organization may lease a facility for a banquet

2

where a per head charge is applied in connection with the

3

serving of a meal.

4

(e.1)  Supplemental materials to accompany application.--The

<--

5

following materials shall be submitted with the application

6

under subsection (e):

7

(1)  An annual financial report limited to the operation

8

of games of chance detailing gross profit, allowable

9

expenses, rent, staff per diem, cost of supplies, net profit

10

and contributions to charitable causes shall be filed with

11

the licensing authority. This report shall be filed with the

12

application for license and shall be filed by the midterm

13

anniversary date of the license in nonapplication years. This

14

report shall be prepared on a one-page form to be designed by

15

the department. The report shall contain information for the

16

12-month period immediately preceding a date 60 days prior to

17

the filing of the report. Failure to file the report by the

18

midterm anniversary date of the license shall result in the

19

automatic suspension of the license until the county

20

treasurer certifies the report has been filed in compliance

21

with this act.

22

(2)  A licensed eligible organization that conducts games

23

of chance 30 or more times in one calendar year must provide

24

evidence to the county treasurer that a bona fide member or

25

designee of the organization has completed four hours of

26

education in the corresponding license period. The education

27

program shall include seminars on law applicable to games of

28

chance and any other related topics the department may

29

require. An education program shall be provided by any

30

nonprofit association approved by the department. This

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1

paragraph shall not apply to organizations seeking or holding

2

limited occasion licenses.

3

(4)  The eligible organization has complied with the

<--

4

annual financial report filing.

5

(5)  The eligible organization has a separate bank

6

account to hold all proceeds of games of chance. 

7

(6)  The eligible organization has complied with the

<--

8

applicable games of chance education requirements.

9

(e.1)  Additional application components.--As part of the

10

application initial or renewal application filed under

<--

11

subsection (e), each eligible organization shall comply with all

12

of the following:

13

(1)  An eligible organization shall file an annual report

14

with the licensing authority. The following shall apply:

15

(i)  The first annual report required under this

16

paragraph shall contain information for the 12-month

17

period ending at least 60 days, but not more than 90

18

days, prior to the submission of the application.

19

Subsequent annual reports shall contain information for

20

the most recent 12-month period ending in the same month

21

as the initial report.

22

(ii)  The annual report shall concern the operation

<--

23

of games of chance by the eligible organization and shall 

24

detail gross receipts from the conduct of games of

25

chance, the expenses related to the conduct of the games

26

of chance, the prizes paid out for games of chance and

27

the details as to how the proceeds from games of chance

28

were used or disbursed by the eligible organization.

29

(iii)  The annual report shall be prepared on a one-

30

page form to be designed by the department. Additional

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1

schedules shall be included, if necessary, to provide

2

specific details on the use or disbursement of the net

3

proceeds from games of chance by the eligible

4

organization.

5

(iv)  A copy of the annual report shall be filed with

<--

6

the application to renew the liquor license of an

7

eligible organization.

8

(2)  An eligible organization shall provide evidence to

9

the licensing authority that games of chance education 

<--

10

training has been completed under this paragraph. The

<--

11

following shall apply:

12

(i)  Two A minimum of two hours of education training 

<--

13

shall have been completed within the 12-month period

14

immediately preceding the date of the application.

15

(ii)  The education training shall have been

<--

16

completed by the executive officer, secretary or a

17

responsible person listed on the eligible organization's

18

application for a license. The person receiving the

19

training shall be associated with the conduct of games of

20

chance by the eligible organization.

21

(iii)  The contents of the education program shall be

<--

22

determined by the department and shall be designed to

23

assist eligible organizations in their compliance with

24

statutory and regulatory requirements associated with the

25

conduct of games of chance.

26

(iv)  The education program may be conducted by any

27

Statewide nonprofit association approved by the

28

department.

29

(iii)  The training shall consist of the completion

<--

30

of training materials prepared by the department. The

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1

training materials shall be designed to assist eligible

2

organizations in their compliance with statutory and

3

regulatory requirements associated with the conduct of

4

games of chance. The training materials shall be

5

available on the department's publicly accessible

6

Internet website. Upon request, the department shall

7

provide hard copies of the training materials at a cost

8

not to exceed the actual cost of printing and postage.

9

(v) (iv)  This paragraph shall not apply if the

<--

10

eligible organization submits an affidavit affirmed by

11

the executive officer or secretary of the eligible

12

organization that the eligible organization will not

13

conduct games of chance on 30 or more days during the

14

licensing period.

15

(f)  List of licensees.--The licensing authority, on a

16

semiannual basis, shall send a copy of all licensees to the

17

Department of Revenue.

18

(g)  List of municipalities.--The licensing authority shall

19

include with any license or renewal issued to an eligible

20

organization, an up-to-date listing of those municipalities

21

within the licensing county which have approved the referendum

22

question on small games of chance.

23

(h)  Background checks.--Each application shall include

24

criminal history records obtained from the Pennsylvania State

<--

25

Police for the executive officer or secretary of the eligible

26

organization making the application and all other responsible

27

persons listed on the application. the results of a criminal

<--

28

history record information check obtained from the Pennsylvania

29

State Police, as defined in 18 Pa.C.S. § 9102 (relating to

30

definitions) and permitted by 18 Pa.C.S. § 9121(b) (relating to

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1

general regulations), for the executive officer or secretary of

2

the eligible organization making the application and all other

3

responsible persons listed on the application.

4

Section 5.1.  Section 12(a) of the act is amended by adding a

5

paragraph to read:

6

Section 12.  Revocation of licenses.

7

(a)  Grounds.--The licensing authority shall revoke or refuse

8

to renew the license of any eligible organization whenever the

9

district attorney finds upon complaint and investigation that:

10

* * *

11

(13)  The eligible organization has failed to keep and

12

maintain the records required under this act for a period of

13

two years.

14

* * *

15

Section 6.  Section 15 of the act, amended December 19, 1990

16

(P.L.812, No.195), is amended to read:

17

Section 15.  Advertising.

18

[It shall be unlawful for any eligible organization or person

19

to] Any eligible organization or person may advertise the prizes

20

or their dollar value to be awarded in games of chance, provided

21

that [prizes may be identified on raffle tickets.

22

Notwithstanding the prohibition of advertising contained within

23

this section, an eligible organization may advertise prizes and

24

values thereof in periodic publications which are limited in

25

their circulation to members of the eligible organization.] such

26

advertisements shall contain the date, time, location, whether

27

cash or merchandise prizes will be awarded and the name of the

28

eligible organization licensed to conduct games of chance and

29

the name of the person who conducts the games of chance.

30

Section 7.  The amendment or addition of section 10(b), (e.1)

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1

and (h) of the act shall apply to applications filed more than

2

two years after the effective date of this section.

3

Section 7.  This act shall apply as follows:

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4

(1)  The amendment or addition of section 10(e)(4) and

5

(5), (e.1)(1) and (h) of the act shall apply to applications

6

filed more than 60 days after the effective date of this

7

section.

8

(2)  The amendment or addition of section 10(e)(6) and

9

(e.1)(2) of the act shall apply to applications filed more

10

than one year after the effective date of this section.

11

Section 8.  This act shall take effect as follows:

12

(1)  The following provisions shall take effect

13

immediately:

14

(i)  The amendment or addition of section 10(b), (e), 

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15

(e.1) and (h) of the act.

16

(ii)  Section 7 of this act.

17

(iii)  This section.

18

(2)  The remainder of this act shall take effect in 60

19

days.

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