Tax 61.08 HistoryHistory: Cr. Register, March, 1989, No. 399, eff. 4-1-89; corrections made under s. 13.93 (2m) (b) 6. and 7., Stats., Register, March, 1995, No. 471; am. (11) (c) and (21) (c), Register, October, 2000, No. 538, eff. 11-1-00; CR 01-088: r. (15) (c) and am. (1), (3), (5), (7), (8), (10), (11) (b), (e) and (h), (13), (14) (b), (bm), (c) and (d), (15) (a), (b) and (d), (16), (19), (20) and (21) (intro.) and (a) to (h) Register February 2002 No. 554, eff. 3-1-02; CR: 04-083: am. (11) (c), (13) (a), (14) (d), (16) (a) and (21) (c), r. (11) (h), (12), and (15), cr. (13) (c) and (d), r. and recr. (17) (a) Register April 2005 No. 592, eff. 5-1-05; CR 07-087: cr. (11) (h), (j), (k), (13) (e), (14) (c), (15), (17) (a) 4., and (22), am. (13) (c) 1., (14) (bm), (17) (b), (18), (21) (intro.) and (g), renum. (14) (c) and (d) to be (14) (d) and (e) and am. Register April 2008 No. 628, eff. 5-1-08; CR 13-034: am. (11) (h), (k), (13) (a), cr. (13) (cm) Register December 2013 No. 696, eff. 1-1-14. Tax 61.085Tax 61.085 Retailer performance program. Tax 61.085(1)(a)(a) The retailer performance program or RPP is intended to provide additional compensation, above the compensation provided under s. 565.10 (14) (b) 1. or 2., Stats., to retailers who meet certain performance goals identified by the department of revenue. This additional compensation is authorized under ss. 565.02 (4) (g) and 565.10 (14) (b) 3m., Stats. Tax 61.085(1)(b)(b) This program is applicable to lottery retailer sales transactions beginning on January 1, 2000. Tax 61.085(2)(a)(a) “Appropriate sales history” means the historical sales data that is used to calculate performance of a retail location within the RPP. The appropriate quarterly sales history data may be from either the comparable history quarter as defined under par. (c) or the immediately previous quarter as defined under par. (e). The appropriate annual sales history data shall be from the comparable history fiscal year under par. (b). Tax 61.085(2)(b)(b) “Comparable history fiscal year” means the previous fiscal year that has sales history in each sales quarter for a specific retail location. Tax 61.085(2)(c)(c) “Comparable history quarter” means the full sales quarter that is one year prior to the current sales quarter in which the RPP is being administered. Tax 61.085(2)(d)(d) “Gross sales” means the sales data as indicated by Wisconsin lottery accounts receivable documentation of weekly invoicing of the purchase of Wisconsin lottery products by retailers. Tax 61.085(2)(e)(e) “Immediately previous quarter” means the full sales quarter immediately prior to the current sales quarter in which the RPP is being administered. Tax 61.085(2)(f)1.1. Any ticket which uses a scratch, pull-tab or break-open method, or a combination of those methods, as the method of player interaction with the ticket. Tax 61.085(2)(f)2.2. Any ticket where the features and procedures documentation under s. 565.27, Stats., indicates the ticket is an instant ticket for purposes of the retailer performance program as identified under this section. Tax 61.085(2)(g)(g) “Retail location” means the place of business at which lottery products such as instant tickets or terminal generated tickets are sold, as selected under s. Tax 61.04. Tax 61.085(2)(h)(h) “Sales goals incentive” means the component of the RPP that pays incentives to retailers who increase gross sales in a specified sales quarter or specified fiscal year, or both, when the sales quarter or fiscal year is compared to an appropriate sales history as defined under par. (a). Tax 61.085(2)(hm)(hm) “Sales quarter” means a quarter of the Wisconsin lottery fiscal year that is 13 weeks in length. Beginning in fiscal year 2001, the administrator shall determine the start and end dates of all sales quarters of a fiscal year no later than one month prior to the beginning of that fiscal year, and upon request shall provide the calendar dates that define each quarter of a fiscal year. A quarter shall start and end on dates that are consistent with the standard billing cycle that the lottery uses to collect revenue from retailer accounts. Tax 61.085(2)(i)(i) “Short-term incentive” means the component of the RPP that pays incentives to retailers who satisfy a performance expectation as established in short-term incentive features and procedures documentation. Tax 61.085(2)(j)(j) “Winning ticket incentive” means the component of the RPP that pays incentives to retailers who sell winning lottery tickets. Tax 61.085(3)(3) Eligibility. Any retailer may participate in the RPP if it meets all of the following eligibility requirements: Tax 61.085(3)(a)(a) The retailer honors the current retailer contract, including any applicable addenda. Tax 61.085(3)(c)(c) The retailer satisfies any qualifying requirements specific to each component of the RPP. If a retailer fails to satisfy the requirements specific to a component of the RPP, the retailer may not be considered qualified for that component of the RPP. A retailer qualifies for each component separately, and qualifying for one component of the RPP does not affect qualifying for another component. Tax 61.085(4)(4) Design. The retailer performance program shall consist of 3 components, the winning ticket incentive, the sales goals incentive, and the short-term incentive described as follows: Tax 61.085(4)(a)(a) Winning ticket incentive. The expected performance of the winning ticket incentive component of the RPP is the selling of winning lottery tickets. To qualify for the winning ticket incentive, a retailer shall satisfy the eligibility requirements in sub. (3). An incentive shall be paid to a retailer for selling any winning lottery ticket where the stated prize value of the winning lottery ticket is $600 or greater. The incentive shall be paid as follows: Tax 61.085(4)(a)1.1. For winning lottery tickets, 2% of the stated prize value shall be paid to a retailer on each prize, up to a maximum of $100,000 per prize level per drawing. In the event that a retailer or retailers earn more than $300,000 from any one prize level in any one drawing, then the lottery shall divide $300,000 equally among all retailers who earned an incentive from that prize level. Tax 61.085(4)(b)(b) Sales goals incentive. The sales goals incentive component of the RPP shall pay a retailer an incentive based on an increase in the amount of sales over the appropriate sales history. The incentive shall be tracked, measured and paid separately for each product type. For each product type, a retailer shall satisfy eligibility requirements in sub. (3), sell a minimum amount of instant tickets as indicated under s. Tax 61.08 (11) (c), and qualify for the product type under sub. (5). Tax 61.085(4)(b)1.1. Quarterly payments may be paid for instant ticket product and for non-jackpot terminal generated product, and shall be made in the following manner: Tax 61.085(4)(b)1.a.a. For the instant ticket sales product type, the retailer shall receive an incentive calculated by comparing a sales quarter against the appropriate sales history to determine if a sales increase has occurred. If a sales increase has not occurred, no incentive may be paid. If a sales increase has occurred, the retailer shall receive up to 2% of the sales increase unless the administrator adjusts the payment percentage to a lower percentage under sub. (7) to ensure that appropriate funding authority is maintained within the current fiscal year. Any adjustment made shall consider historical sales and incentive information and shall be applied equally to all retailers. Information regarding the details of any adjustment shall be made available upon request to the administrator. Tax 61.085(4)(b)1.b.b. For the non-jackpot terminal-generated sales product type, the retailer shall receive an incentive calculated by comparing a sales quarter against the appropriate sales history to determine if a sales increase has occurred. If a sales increase has not occurred, no incentive may be paid. If a sales increase has occurred, the retailer shall receive up to 2% of the sales increase unless the administrator adjusts the payment percentage to a lower percentage under sub. (7) to ensure that appropriate funding authority is maintained within the current fiscal year. Any adjustment made shall consider historical sales and incentive information and shall be applied equally to all retailers. Information regarding the details of any adjustment shall be made available upon request to the administrator. Tax 61.085(4)(b)2.2. Annual payments may be paid for instant ticket product, non-jackpot terminal generated product and jackpot terminal-generated product, and shall be made in the following manner: Tax 61.085(4)(b)2.a.a. For the instant ticket sales product type the retailer shall receive an incentive calculated by comparing a fiscal year against the appropriate sales history to determine if a sales increase has occurred. If a sales increase has not occurred, no incentive may be paid. If a sales increase has occurred, the retailer shall receive up to 10% of the sales increase unless the administrator adjusts the payment to a lower percentage under sub. (7) to ensure that appropriate funding authority is maintained within the current fiscal year. Any adjustment made shall consider historical sales and incentive information and shall be applied equally to all retailers. Information regarding the details of any adjustment shall be made available upon request to the administrator. Any incentive paid to a retailer shall be adjusted by the percentage of locations contracted to that retailer that do not generate an increase, except that locations which do not have a comparable history fiscal year are not considered when this adjustment is made. Tax 61.085 NoteNote: For example: If a retailer has a contract to sell lottery products that includes three retail locations and one of the retail locations fails to generate an increase, then the lottery will adjust the incentive payments to those retail locations which earned an increase. In this example, the adjustment of each payment is calculated by reducing each payment by one third, the number of retail locations included in the contract but for which an increase was not earned.
Tax 61.085(4)(b)2.b.b. For the non-jackpot terminal-generated sales product type, the retailer shall receive an incentive calculated by comparing a fiscal year against the appropriate sales history to determine if a sales increase has occurred. If a sales increase has not occurred, no incentive may be paid. If a sales increase has occurred, the retailer shall receive up to 10% of the sales increase unless the administrator adjusts the payment to a lower percentage under sub. (7) to ensure that appropriate funding authority is maintained within the current fiscal year. Any adjustment made shall consider historical sales and incentive information and shall be applied equally to all retailers. Information regarding the details of any adjustment shall be made available upon request to the administrator. Any incentive paid to a retailer shall be adjusted by the percentage of locations contracted to that retailer that do not generate an increase, except that locations which do not have a comparable history fiscal year are not considered when this adjustment is made. Tax 61.085 NoteNote: For example: If a retailer has a contract to sell lottery products that includes three retail locations and one of the retail locations fails to generate an increase, then the lottery will adjust the incentive payments to those retail locations which earned an increase. In this example, the adjustment of each payment is calculated by reducing each payment by one third, the number of retail locations included in the contract but for which an increase was not earned.
Tax 61.085(4)(b)2.c.c. For the jackpot terminal-generated sales product type, the retailer shall receive an incentive calculated by comparing a fiscal year against the appropriate sales history to determine if a sales increase has occurred. If a sales increase has not occurred, no incentive may be paid. If a sales increase has occurred, the retailer shall receive up to 10% of the sales increase unless the administrator adjusts the payment percentage to a lower percentage under sub. (7) to ensure that appropriate funding authority is maintained within the current fiscal year. Any other adjustment made shall consider historical sales and incentive information and shall be applied equally to all retailers. Information regarding the details of any adjustment shall be made available upon request to the administrator. Any incentive paid to a location shall be adjusted by the percentage of locations contracted to that retailer that do not generate an increase, except that locations which do not have a comparable history fiscal year are not considered when this adjustment is made. Tax 61.085 NoteNote: For example: If a retailer has a contract to sell lottery products that includes three retail locations and one of the retail locations fails to generate an increase, then the lottery will adjust the incentive payments to those retail locations which earned an increase. In this example, the adjustment of each payment is calculated by reducing each payment by one third, the number of retail locations included in the contract but for which an increase was not earned.
Tax 61.085 NoteNote: For the fiscal year ending June 30, 2000, “fiscal year 2000,” the Wisconsin lottery shall use the appropriate historical data from the fiscal year which ended on June 30, 1999, “fiscal year 1999,” to determine a one-half fiscal year goal for the jackpot terminal-generated game product type under subd. 3.
Tax 61.085(4)(c)(c) Short-term incentive. The short-term incentive shall pay a retailer an incentive based on the achievement of expected performance. Short-term incentives shall be designed to support a certain product or product type or to strengthen sales during certain times of the fiscal year. Performance expectations shall be related to the increasing of sales of lottery products and may be different for each short-term incentive offered to retailers. A short-term incentive may not continue from one fiscal year into another fiscal year. The administrator shall determine whether short-term incentives are offered. The expected performance, and all other information important to the development of a specific short-term incentive, shall be indicated in a document that shall represent the features and procedures of the short-term campaign. Payment may be in the form of merchandise or lottery products. The features and procedures document shall be published to the retailers no later than 14 calendar days prior to the start date of the incentive and shall include the following: Tax 61.085(4)(c)1.1. A statement of the requirements for a retailer to qualify for the program. The requirements for qualification for short-term incentives shall be as consistent as possible with other aspects of the RPP. Tax 61.085(4)(c)2.2. A statement of the expected performance of a retailer who participates in the short-term incentive. Tax 61.085(4)(c)3.3. A statement of the start and end dates of the program and the expected time period that the plan will run. Tax 61.085(4)(c)4.4. A statement of how much funding may be made available for payment under the plan, not to exceed $300,000 per short-term incentive. Tax 61.085(4)(c)5.5. A detailed explanation of how the incentive is calculated, to be consistent with other aspects of the RPP where appropriate. Tax 61.085(4)(c)6.6. A detailed explanation of how incentive payments will be made, and that payments shall be made no later than the last Thursday of the month following the last day of the sales quarter in which the short-term incentive ends. If payment is made in merchandise or lottery product, the explanation will include information about the merchandise or lottery product. Tax 61.085(4)(c)7.7. Any other features or procedures determined by the administrator to be appropriate. Tax 61.085(4)(d)(d) Merchandise as payment. If merchandise is used as payment, all of the following conditions must be met: Tax 61.085(4)(d)1.1. The lottery may spend up to 10% of the funding available for the RPP, under s. 565.02 (4) (g), Stats., for merchandise or lottery product per fiscal year. Tax 61.085(4)(d)2.2. The lottery shall procure appropriate merchandise, merchandise fulfillment or inventory control for the implementation of short-term incentives by conducting procurement activities under s. 565.25, Stats. The lottery shall properly account for lottery product used in a short-term incentive. Tax 61.085(4)(d)3.3. The lottery shall provide for the appropriate control of the merchandise or lottery product, including provisions for inventory and physical security where necessary. Tax 61.085(5)(a)(a) To qualify annual sales goals incentives under sub. (4) (b) 2., jackpot terminal-generated sales product type, a retail location shall have a comparable history fiscal year as defined under sub. (2) (b). Tax 61.085(5)(am)(am) If no appropriate sales history can be determined, the retail location may not be considered qualified for annual incentives for that product type. The administrator shall review qualification under each product type no less often than yearly, so that retail locations that become qualified may be included for incentive payments as soon as possible. Tax 61.085(5)(b)(b) To qualify for quarterly sales goals incentives under sub. (4) (b) 1., a retail location shall meet the qualification criteria for that product type. Each product type shall be reviewed separately to determine if an appropriate quarterly sales history as defined under sub. (2) (a) is available to satisfy the criteria. The criteria are as follows: Tax 61.085(5)(b)1.1. For a retail location, if there is comparable history quarter sales data as defined under sub. (2) (c), the retailer shall be considered qualified for that product type. Tax 61.085(5)(b)2.2. If no comparable history quarter exists for a retail location, the administrator shall substitute sales history from the immediately previous quarter as defined under sub. (2) (e). Tax 61.085(5)(b)3.3. If no appropriate quarterly sales history can be determined, either by using data from a comparable history quarter or from an immediately previous quarter, the retail location may not be considered qualified for quarterly incentives for that product type. The administrator shall review qualification under each product type no less often than quarterly so that retail locations that become qualified may be included for incentive payments as soon as possible. Tax 61.085(6)(6) Payment of incentives. The RPP incentives shall be paid in the following sequential order: Tax 61.085(6)(c)(c) Quarterly Sales Goals Incentives, under sub. (4) (b) 1., where the sequence of product types paid shall be instant ticket sales products, then non-jackpot terminal-generated products. Tax 61.085(6)(d)(d) Annual Sales Goals Incentives, under sub. (4) (b) 2., where the sequence of product types paid shall be instant ticket sales products, then non-jackpot terminal-generated products, and last jackpot terminal-generated products. Tax 61.085(6)(e)1.1. The winning ticket incentive shall be paid no later than the last Thursday of the month following the last day of the quarter in which the incentive is earned. This incentive may be paid more frequently if the administrator determines that a more frequent schedule is not prohibitive to the effective operation of Wisconsin lottery activities and does not have a negative impact upon the appropriate funding authority of the program. Tax 61.085(6)(e)2.2. The short-term incentive shall be paid no later than the last Thursday of the month following the last day of the quarter in which the incentive is earned. This incentive may be paid more frequently if the administrator determines that a more frequent schedule is not prohibitive to the effective operation of Wisconsin lottery activities and does not have a negative impact upon the appropriate funding authority of the program. Tax 61.085(6)(e)3.3. The sales goals quarterly incentive shall be paid no later than the last Thursday of the month following the last day of the quarter in which the incentive is earned. The sales goals incentive may be paid more frequently if the administrator determines that a more frequent schedule is not prohibitive to the effective operation of Wisconsin lottery activities and does not have a negative impact upon the appropriate funding authority of the program. Tax 61.085(6)(e)4.4. The annual incentive payments shall be paid no later than the last Thursday of the month following the last day of the fiscal year in which the incentive is earned. Jackpot terminal-generated products shall be paid last of all incentive payments in a fiscal year. This incentive may be paid more frequently if the administrator determines that a more frequent schedule is not prohibitive to the effective operation of Wisconsin lottery activities and does not have a negative impact upon the appropriate funding authority of the program. Tax 61.085(7)(7) Funding authority. The administrator shall monitor the expenditures of the RPP at least quarterly, to ensure that the funding authority is not exceeded. Prior to the payment of incentives under sub. (4) (b), the administrator may implement a pre-payment adjustment to ensure that funding authority for the RPP is not exceeded, by reducing the payment of incentives earned. Any pre-payment adjustment in any product type shall be implemented as indicated under sub. (4) (b), to limit the incentive paid so that the payments do not exceed the funding available or negatively impact the payment of earned incentives in the other components of the RPP. Tax 61.085(8)(8) Right to appeal. In the event the administrator terminates the eligibility or qualification of a retailer under the RPP, or in the event the retailer disputes their payments from the RPP, the retailer is entitled to an appeal in accordance with the provisions set forth under s. Tax 61.10. Tax 61.085(9)(9) Report. The administrator shall document the total payments made to retailers under the RPP. The report shall include a breakdown of any incentives paid under the winning ticket incentive, the sales goals incentive and the short-term incentive. The report shall be available within 90 days of the completion of a fiscal year. Tax 61.085 HistoryHistory: Cr. Register, October, 2000, No. 538, eff. 11-1-00; CR 04-083: cr. (2) (f) and (4) (d), am. (4) (a) 1. and 2., (c) (intro.), 3., 4., 6., and (7) Register April 2005 No. 592, eff. 5-1-2005; CR 04-083: am. (2) (a), (4) (b) (intro.), (5) (a), (b), and (6), renum. (2) (b) to (i), (4) (b) 1. to 3., (6) (a) and (b) to be (2) (c) to (j), (4) (b) 1. a., b., 2. c., and (6) (e) 1. and 3., and am. (2) (h), (4) (b) 1. a., b., 2. c., and (6) (e) 3., cr. (2) (b) and (f), (4) (b) 1. to 3., (5) (am), (6) (a), (b), (d), (e) (intro.), 2. and 4., r. and recr. (6) (c) Register April 2005 No. 592, eff. 7-2-05; CR 07-087: am. (3) (a) and (4) (b) (intro.), r. (4) (a) 2. Register April 2008 No. 628, eff. 5-1-08. Tax 61.09Tax 61.09 Limitation on length of suspension. A suspension shall be limited to a maximum of 45 calendar days, during which time the administrator shall consider the appropriate permanent action to be taken, including, but not limited to, termination of the retailer contract. Tax 61.10(1)(1) The administrator shall give the retailer written notice of the retailer’s terminated contract and state the grounds for the termination. The retailer shall also be notified that a request for a reconsideration must be made by the retailer within 30 calendar days and that the request must contain the information in sub. (2). Tax 61.10(2)(2) Within 30 calendar days of the mailing of the notice, the retailer may request a reconsideration by filing with the administrator a written statement setting forth the retailer’s legal, factual or equitable arguments and submitting any supporting documents. The request for reconsideration shall be deemed filed on the date it is received by the administrator. Tax 61.10(3)(3) Within 20 calendar days of receipt of the request for reconsideration, the administrator may, in writing, request the retailer to submit any additional facts, legal and equitable arguments or documents that the administrator deems necessary to make a determination. Tax 61.10(4)(4) The Wisconsin lottery’s legal counsel shall compile all relevant correspondence, lottery accounting records and all materials submitted to the administrator by the retailer for reconsideration. Legal counsel shall then review the file, research, if necessary, the applicable laws and rules and prepare an analysis and recommendation for the administrator’s consideration. Tax 61.10(5)(5) The administrator, after considering all the facts and arguments submitted by the retailer, and legal counsel’s recommendation, shall independently evaluate whether to either reinstate or terminate the contract. Within 45 calendar days of the administrator’s receipt of the request for reconsideration or any supplemental information and documentation requested, the administrator shall notify the retailer, in writing, of the determination. If the contract is terminated, the notification shall include a statement setting forth the reasons for the termination and notifying the retailer of the right to a hearing under s. 227.42, Stats. The retailer shall also be notified that a request for a hearing must be made by the retailer within 20 calendar days and that the request must contain the information in sub. (6). Tax 61.10(6)(6) Within 20 calendar days of the administrator’s mailing of the final determination, the retailer may request, in writing, a hearing under s. 227.42, Stats. A request shall be deemed filed on the date it is received by the administrator. A request for a hearing under s. 227.42, Stats., shall contain all of the following: Tax 61.10(6)(c)(c) The facts that the retailer intends to prove at the hearing. Tax 61.10(6)(d)(d) A description of the mistake the retailer believes was made, if the retailer claims that the termination of contract is based on a mistake in fact or in law. Tax 61.10(6)(e)(e) Any supporting documents not previously submitted to the administrator.
