The Kansas Lottery Gaming Facility Review Board is a seven member board appointed to determine the “best possible contract” 1 and select lottery gaming facility managers in each of the four lottery gaming zones in the state of Kansas.
The members of the Review Board are appointed: Three members by the governor, two by the president of the senate, and two by the speaker of the house of representatives.2 Each member of the Review Board serves until they either resign their position or are replaced by their appointing authority.3
The Review Board is made up of individuals with business expertise. Persons who own property, live, or do significant business in a gaming zone are not eligible to sit on the Review Board.4
For staffing purposes, the Review Board is attached to the Kansas Racing and Gaming Commission (KRGC).5 This means that the Review Board uses the office, legal, accounting and technical staff of the KRGC in its day to day operations.
The expenses of the Review Board, including travel, staff time, facility rental, and consulting work are paid by the applicants.6 KRGC staff estimates a budget at the beginning of the process and bills each applicant a proportional share. No taxpayer funds or State of Kansas General Fund money is used to fund the Review Board process.
The Facility Manager Selection Process
The selection process for gaming facility managers is a step by step process involving both state and local authorities.
- At the state level, applicants must submit an application to manage a lottery gaming facility in a specific zone to the Kansas Lottery in response to the Kansas Lottery’s Request for Proposals.7 More information about the Kansas Lottery’s role in this process can be found at www.kslottery.com.
- Local government must endorse each proposal before it can proceed to the Lottery Gaming Facility Review Board. This endorsement process is designed and run entirely by local officials. The Kansas Lottery, Lottery Gaming Facility Review Board and Kansas Racing and Gaming Commission have no authority or involvement in the local endorsement process. However, for any application to proceed, it must bear local endorsement.8
- The Kansas Lottery must attempt to negotiate management contracts with all eligible applicants. Lottery officials have 90 days (with a possible 60 day extension) to negotiate and approve management contracts.9 The Lottery Commission must approve the Lottery facility management contract and certify that the contract meets minimum statutory requirements. These requirements include a minimum amount of experience in class III gaming and a minimum investment in infrastructure, among other requirements.10
- Once the Kansas Lottery Commission has approved the management contract, the contracts proceed to the Kansas Lottery Gaming Facility Review Board. The Review Board must determine the “best possible contract”11. The Board has 60 days (with a possible 60 day extension) to make its determination.12 In determining the best possible contract, the Board must consider “which contract best maximizes revenue, encourages tourism and otherwise serves the interests of the people of Kansas.”13 A simple majority vote is required to determine which contract is the best possible contract in the opinion of the Review Board.
- The Review Board selects the best possible contract and forwards it to the Kansas Racing and Gaming Commission for approval. Prior to approval, the KRGC must conduct a background investigation of the prospective lottery gaming facility manager as well as its directors, officers, and other persons having an ownership interest in the prospective manager. The KRGC has 10 days (with a possible 60 day extension) to approve the background of the lottery facility manager.14 Because ten days in not enough time to complete the background investigations, which can take months to complete, the KRGC begins the background investigation process on all applicants as soon as they apply. Once the Board selects a candidate, the KRGC stops investigating the other candidates and concentrates on completing the background of the selected candidate.
1 K.S.A. 74-8736 (a)
2 K.S.A. 74-8735 (a)
3 Attorney General Opinion No. 2009-11
4 K.S.A. 74-8735 (c)
5 K.S.A. 74-8735 (h)
6 K.S.A. 74-8735 (h)
7 K.S.A. 74-8733 (b)
8 K.S.A. 74-8733 (h)(10)
9 K.S.A. 74-8736 (a)
10 K.S.A. 74-8733 (g)
11 K.S.A. 74-8735 (d)(1)
12 K.S.A. 74-8736 (d)(1)
13 K.S.A. 74-8736 (b)
14 K.S.A. 74-8736 (e)