2005 California Government Code Sections 8880.34-8880.46 Article 4. Powers and Duties of the Director

8880.34.  Salary
   The Director shall receive the salary provided for by Chapter 6
(commencing with Section 11550 of Part 1 of Division 3 of Title 2.
The Director shall devote his or her entire time and attention to the
duties of his or her office and shall not be engaged in any other
profession or occupation.
8880.35.  The director shall, subject to the approval of the
commission, perform all duties, exercise all powers and jurisdiction,
assume and discharge all responsibilities, and carry out and effect
all purposes of this chapter.  The director shall act as secretary of
the  commission and executive officer of the lottery.  The director
shall supervise and administer the operation of the lottery in
accordance with this chapter and the regulations promulgated by the
commission.  In addition, the director shall have access to criminal
history information pursuant to Sections 11105 and 11105.01 of the
Penal Code.  In all decisions, the director shall take into account
the particularly sensitive nature of the California State Lottery and
shall act to promote and ensure integrity, security, honesty, and
fairness of the operation and administration of the lottery.  In
decisions relating to advertising and promotion of the lottery, the
director shall ensure that the lottery complies with both the letter
and spirit of the laws governing false and misleading advertising,
including Section 17500 and following of the Business and Professions
Code.
8880.36.  Power to Hire
   The Director shall hire, pursuant to the approval of the
Commission, such professional, clerical, technical and administrative
personnel as may be necessary to carry out the provisions of this
Chapter.
8880.37.  Deputy Directors
   Upon recommendation of the Director, the Governor shall appoint up
to four deputy directors.  The Director shall supervise each deputy
director's activities.  The Commission shall determine the
compensation of each deputy director.
8880.38.  Deputy Director for Security
   One of the deputy directors shall be responsible for a security
division to assure integrity, honesty, and fairness in the operation
and administration of the California State Lottery, including, but
not limited to, an examination of the qualifications and criminal
history of all prospective and current employees, prospective and
current Lottery Game Retailers, and prospective and current Lottery
suppliers as defined in Section 8880.57.  Fingerprints shall be
obtained in this process and shall be furnished to the Department of
Justice. The Department of Justice shall submit one set of the
fingerprints to the Federal Bureau of Investigation as required, and
shall retain the other set to obtain the California criminal history
record that may be maintained.
   The Deputy Director for Security shall be qualified by training
and experience, including at least five years of law enforcement
experience, and shall have knowledge and experience in computer
security, to fulfill these responsibilities.  The Deputy Director for
Security shall confer with the Attorney General or his or her
designee and the Controller or his or her designee as the Deputy
Director for Security deems necessary and advisable to promote and
ensure integrity, security, honesty, and fairness of the operation
and administration of the Lottery.  The Deputy Director for Security
shall report any alleged violation of any law related to the
operations of the California State Lottery to the appropriate law
enforcement agency and the Attorney General for further investigation
and action.  The Deputy Director for Security and lottery security
officers shall have access to criminal history information pursuant
to Sections 11105 and 11105.01 of the Penal Code.
8880.39.  The director shall confer as frequently as necessary or
desirable, but not less than once every quarter, with the commission,
on the operation and administration of the lottery.  The director
shall make available for inspection by the commission, upon request,
all books, records, files, and other information and documents of the
lottery, advise the commission and recommend any matters as he or
she deems necessary and advisable to improve the operation and
administration of the lottery.
8880.40.  Study of Lottery Systems; Recommendations for Improvement
   The Director shall make an on-going study of the operation and the
administration of the lotteries which may be in operation in other
states or countries, of available literature on the subject, of
Federal laws which may affect the operation of the Lottery, and of
the reaction of citizens of the State to existing or proposed
features in Lottery Games, with a view toward recommending
improvements that will tend to serve the purposes of this Chapter.
The Director may make recommendations to the Commission, Governor,
and Legislature on any matters concerning the secure and efficient
operation and administration of the lottery and the convenience of
the purchasers of tickets and shares.
8880.41.  The director shall make and keep books and records that
accurately and fairly reflect each day's transactions, including, but
not limited to, the distribution of tickets or shares to lottery
game retailers, receipt of funds, prize claims, prize disbursements
or prizes liable to be paid, expenses and other financial
transactions of the lottery necessary so as to permit preparation of
financial statements in conformity with generally accepted accounting
principles and maintain daily accountability.
8880.42.  The director shall provide a monthly cumulative sales
report to the commission and the Controller within 15 days after the
end of each month.  The report shall include cumulative lottery sales
by product, compared to the commission-approved budget and the
estimated administrative expenses for the current fiscal year.
8880.43.  Independent Audit of Lottery Finances
   The director shall engage an independent firm of certified public
accountants to conduct an annual audit of all accounts and
transactions of the lottery.  The audited financial statements shall
be presented to the commission, the Governor, the Controller, the
Treasurer, the Attorney General, and the Legislature not more than
120 days after the close of the fiscal year.
8880.44.  Demographic Study of Lottery Players
   After the first six months of sales to the public, the Director
shall engage an independent firm experienced in demographic analysis
to conduct a special study which shall ascertain the demographic
characteristics of the players of each Lottery Game, including but
not limited to their income, age, sex, education, and frequency of
participation.  This report shall be presented to the Commission, the
Governor, the State Controller, the State Treasurer, and the
Legislature.  Similiar studies shall be conducted from time to time
as determined by the Director.
8880.45.  Study of the Effectiveness of Lottery Communications
   After the first full year of sales to the public, the Director
shall engage an independent firm experienced in the analysis of
advertising, promotion, public relations, incentives, and other
aspects of communications to conduct a special study of the
effectiveness of such communication activities and make
recommendations to the Commission on the future conduct and future
rate of expenditure for such activities.  This report shall be
presented to the Commission, the Governor, the State Controller, and
the State Treasurer.  Until the presentation of such report and
action by the Commission, the Commission shall expend as close to
31/2% as practical of the projected sales of all lottery tickets and
shares for advertising, promotion, public relations, incentives, and
other aspects of communications.  Similar studies shall be conducted
from time to time after the first such study as determined by the
Director.
8880.46.  After the first nine months of sales to the public, the
Commission shall engage an independent firm experienced in security
procedures, including, but not limited to, computer security and
systems security, to conduct a comprehensive study and evaluation of
all aspects of security in the operation of the Lottery.  This study
shall include, but not be limited to, personnel security, Lottery
Game Retailer security, Lottery Contractors security, security of
manufacturing operations of Lottery Contractors, security against
ticket counterfeiting and alterations and other means of fraudulently
winning, security of drawings, computer security, data
communications security, data base security, security controls and
physical security, security in distribution, security involving
validation and payment procedures, security involving unclaimed
prizes, security aspects applicable to each particular Lottery Game,
security against locating winners in Lottery Games having preprinted
winners, and any other aspects of security applicable to the Lottery
and its operations.  The portion of the report containing the overall
evaluation of the Lottery in terms of each aspect of security shall
be presented to the Commission, the Governor, the Controller, the
Treasurer, the Attorney General, and the Legislature.  The portion of
the report containing specific recommendations shall be exempt from
public disclosure and shall be presented only to the Commission, the
Attorney General, the Controller and the Governor.  Upon request, all
materials and data used in the production of the report shall be
made available to the Commission, the Attorney General, the
Controller, and the Governor.  Similar audits of security shall be
conducted every two years after the completion of the first audit.