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Coin Operated Amusement Machine FAQs

When will the new law go into effect?
The law became effective upon the Governor's signature of the bill (HB 487) on April 10, 2013.

Who regulates coin operated amusement machines?
Effective April 10th, 2013, the Georgia Lottery Corporation (GLC) regulates the industry.

Will the GLC be issuing new rules and regulations?
Yes. The GLC is currently working on new rules and regulations to reflect the changes in HB 487.

Will I renew my license with the Georgia Department of Revenue or with the GLC?
Your renewal for the license year 2014 will be handled by the Georgia Department of Revenue on behalf of the Georgia Lottery Corporation. For more information, please visit the Department of Revenue website at www.etax.dor.ga.gov.

Will there be changes to current fees or license periods?
There are no changes to the current fee structure or license period (July-June).

Are there additional reports that I must file? With whom do I file?
For each business location, the Class B master license holder and the location owner or location operator (retailer) will be required to begin filing monthly revenue reports beginning July 1, 2013. The first report, which covers the month of July, will be due August 20, 2013. Additional details regarding required information, format, where to file etc. will be provided by the Georgia Lottery Corporation.

Failure to file such reports or filing false reports may result in suspension or loss of license, fines up to $25,000 and a felony conviction.

Can I apply for a new Class B Master License?
No. According to HB 487, the GLC shall not issue any new Class B master licenses until one year after the Class B accounting terminal is implemented and certified. Acceptance dates for receiving applications will be communicated to the public as they are determined.

When will the Class B accounting terminal be implemented?
According to HB 487 the GLC must procure a Class B accounting terminal on or before July 1, 2014. Six months after the procurement and successful pilot testing all Class B machines shall be linked to the Class B accounting terminal.

How many Class B machines may I own?
There has been no change in the amount of machines a master license holder can own.

Is there a limitation on how much of my gross receipts can come from Class B machines?
HB 487 states that no location owner or location operator shall derive more than 50 percent of their monthly gross retail receipts from Class B machines.

Will my Class A machines be connected to the lottery’s central accounting system?
No. Although the GLC will regulate all machines, the only machines required to be connected to the central accounting system are Class B machines.

As a Class B master license holder, do I need to have a written contract and/or lease agreement with my Class B locations?
Yes, a Class B master license holder and a Class B location owner or operator must enter into a written agreement for the placement of amusement machines in the business. The agreement must be exclusive for each location. A copy of the written agreement must be available for inspection at the master license holders’ and the location owner’s place of business.

What is the new revenue split between the master license holder and the operator (retailer)? When does the new “split” take effect?
Effective April 10th, 2013 the revenue split between the master license holder and the retailer is 50/50. This overrides any current agreements that may have different splits. Once the Class B accounting system is in place the GLC will initially receive 5%, increasing by one percent each year to a maximum of 10% with the master license holder and the retailer each splitting the remainder of the funds.

Can I own and operate the Class B machines at my retail establishment?
Effective July 1, 2013, you cannot be both a Class B master license holder and a location license operator, nor can a location license operator have any direct or indirect interest in a company or person with a Class B master license. There is one small provision for persons where both the Class B master license holder and the owner of the business are the same business entity and can prove that, as of December 31, 2013, they continuously possessed machines that have been operated for more than 10 years in a location.

Can a location owner or location operator receive anything of value from a master license holder in consideration of having bona fide coin operated amusement machines in an establishment?
No. Other than the revenue split, the master licensee cannot offer it and the location owner or operator cannot accept it. The penalty for this violation is a fine up to $50,000 per incident and revocation of one’s license for a 1 – 5-year period.

Do I still need a physical Georgia location to own Class A or Class B machines in Georgia?
You will need a functional office in Georgia with office staff knowledgeable of your coin operated amusement machine operations.

Can I place my Class B machines in a location that has not applied for their location license?
No. Based on HB 487 you, as a master licensee, can be subjected to large fines, suspension and/or revocation if machines are placed in unlicensed locations.

Can a master license holder pay for the location license where their machines are being placed?
No. According to section O.C.G.A. 50-27-87.1.1 each violation is subject to a $50,000 fine. Nor can a location license holder request or master license holder provide any additional payment or consideration, including loans, financing arrangement, gift, procurement fee, lease payment or payment of fees for the placement of machines.

When can I begin offering lottery tickets for prize redemption?
Lottery tickets may now be offered for prize redemption for Class B machine winnings to persons 18 years of age or older. Lottery tickets may NOT be awarded as prizes for Class A machine winnings. The $5 per play limitation for non-cash redemption (including lottery tickets) remains the same, but players can continue to accumulate winnings.

Do I need to be a licensed Georgia Lottery retailer to provide lottery tickets for prize redemption?
No. However, the same restrictions apply – tickets may only be used for redemption for play on Class B machines only, to persons 18 years of age or older.

Can Class B prize redemption prizes be loaded on to the GLC’s iHOPEcard?
No, not at this time.

Under what conditions can the Georgia Lottery Corporation revoke or suspend a location owner’s or location operator’s license?

  1. Intentional violation of a provision of the law or regulation promulgated under the law.
  2. Failure to provide requested information, intentionally making false statements or omitting any material or requested information.
  3. Engaging in a coercive action.
  4. Engaging in unfair methods of competition and unfair or deceptive acts or practices as defined by the law.
  5. Failure to meet any obligations imposed by the tax laws or other laws or regulations of this state.

What types of penalties could I face?

  1. Failure to obtain a master license or location license shall subject a person to a fine of up to $25,000, repayment of all fees or receipts due to the GLC and loss of licenses.
  2. $1,000 each for improper use of a machine permit sticker.
  3. $25,000 for each improper use of a master license certificate.
  4. Any person who knowingly makes a material false statement on any application or renewal application for a master license or permit sticker or on any book, record or report required by the law is guilty of a FELONY and upon conviction shall be punished by imprisonment for not less than one year/no more than 5 years and a fine not to exceed $25,000.
  5. In addition to fines, criminal sanctions and the loss of one’s master license or location license, a person could also lose other permissive licenses issued by the state or local government including, but not limited to licenses for alcohol, lottery and tobacco products.

Can local governments audit machine receipts and or limit Class B machines?
Yes. Local governments will have the right to audit the business location owner or operators reports to verify compliance with local and state laws. In addition, they can reduce the number of Class B machines to six in a business. A local ordinance would be required for these actions to take effect.

How do I become a COAM location operator?
Those interested in becoming a COAM location operator must submit an application for a location license, pay the appropriate fee and post a copy of their agreement with a master license owner at their retail location.

To apply for a location license please visit the Department of Revenue website at www.etax.dor.ga.gov or call 1-877-423-6711.

Am I required to place COAM’s in my location if I am a lottery retailer?
No.

Am I required to be a licensed lottery retailer to place COAM’s in my location?
No.

Is the Georgia Lottery Corporation (GLC) recruiting new COAM location operators?
No. Master license owners/operators are not employees of the Georgia Lottery Corporation (GLC) and do not represent the GLC.

How will the GLC provide additional updates?
Updates will be provided through the Georgia Lottery website at www.galottery.com and the Georgia Department of Revenue's website at www.etax.dor.ga.gov.

What information will be required to be reported monthly by each Master License Holder?
Commencing July 1, 2013, and subject to future adjustment, Master License Holders will be required to report, separately by location on a monthly basis, the following:

  • Class B Machine Total Gross Receipts
  • Class B Machine Total Net Receipts
  • Discrepancy/Adjustment Amounts
  • Last Collection Date between Master License Holder and the Location Owner / Location Operator

Each such monthly report shall be submitted in electronic format as required by the GLC and shall be due by the 20th of the following month. That is, the first report for the month of July 2013 shall be due August 20, 2013, with subsequent reports due on the twentieth day of each month thereafter for the previous month. The Georgia Lottery Corporation intends to email all Master License Holders, detailing specific reporting instructions, on or around August 1, 2013.

What information will be required to be reported monthly by each licensed Location Owner or licensed Location Operator?
Commencing July 1, 2013, and subject to future adjustment, each Location Owner or Location Operator will be required to report, separately by location on a monthly basis, the following:

  • Class B Machine Total Gross Receipts
  • Class B Machine Total Net Receipts
  • Gross Retail Receipts for the Business Location
  • Total Prizes
  • Total Georgia Lottery Online Ticket Prizes
  • Total Georgia Lottery Instant Ticket Prizes
  • Discrepancy/Adjustment Amounts
  • Last Collection Date between Master License Holder and the Location Owner / Location Operator
  • Number of License B machines for the Business Location.

Each such monthly report shall be submitted in electronic format as required by the GLC and shall be due by the 20th of the following month. That is, the first report for the month of July 2013 shall be due August 20, 2013, with subsequent reports due on the twentieth day of each month thereafter for the previous month. The Georgia Lottery Corporation intends to email all licensed Location Owners and licensed Location Operators, detailing specific reporting instructions, on or around August 1, 2013.

How do I report suspect business practices regarding the operation and management of Class B Coin Operated Machines (COAM) in Georgia?
An anonymous tip line is provided by the Georgia Lottery Corporation for the public or business owners in the State of Georgia to report suspect business practices regarding the operation and management of the Class B Coin Operated Amusement Machines (COAM).
To report abuse, please contact:

MASTER LICENSE and LOCATION LICENSE HOLDERS may now apply online for 2015 COAM licenses by clicking here.

COAM Advisory Board Members:

  • Lee Hunter, Chairman
  • Mike Chamlee, Vice Chairman
  • Gus Makris, Secretary
  • Debbie Alford
  • Stewart Carswell
  • Emily Dunn
  • Patrick Jones
  • Chris Pope
  • Jim Siskin
  • CB Yadav

Upcoming COAM Advisory Board Meetings:

  • October 8, 2014
  • November 12, 2014
  • December 10, 2014
  • January 14, 2015
  • February 11, 2015
  • March 11, 2015
  • April 8, 2015
  • May 13, 2015
  • June 10, 2015
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