(1) The Director of the Oregon State Lottery shall make an ongoing 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 Oregon State 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 Legislative Assembly on any matters concerning the secure and efficient operation and administration of the state lottery and the convenience of the purchasers of tickets and shares.

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(2) The director shall make and keep books and records which 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 all other financial transactions involving state lottery funds necessary so as to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain daily accountability.

(3) The director shall make a monthly financial report to the commission, and upon request provide copies of such reports to the Governor, the Attorney General, the Secretary of State, the State Treasurer and the Legislative Assembly. Such report shall include a full and complete statement of state lottery revenues, prize disbursements, expenses, net revenues and all other financial transactions involving state lottery funds for the month.

(4) After the first six months of sales of tickets or shares 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 Attorney General, the Secretary of State, the State Treasurer and the Legislative Assembly. Similar studies shall be conducted after the first such study from time to time as determined by the director.

(5) After the first full year of sales of tickets or shares to the public, the director shall engage an independent firm experienced in the analysis of advertising, promotion, public relations, incentives, public disclosures of odds and numbers of winners in lottery games and other aspects of communications to conduct a special study of the effectiveness of such communications activities by the state lottery 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 Attorney General, the Secretary of State, the State Treasurer and the Legislative Assembly. Until the presentation of such report and action by the commission, the state lottery shall expend as close to three and one-half percent as practical of the projected sales of all tickets and shares for advertising, promotion, public relations, incentives, public disclosures of odds and numbers of winners in lottery games and other aspects of communications. Similar studies shall be conducted from time to time after the first such study as determined by the director.

(6) After the first nine months of sales of tickets or shares 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 state lottery. Such study shall include, but not be limited to, personnel security, lottery game retailer security, lottery contractor security, security of manufacturing operations of lottery contractors, security against ticket counterfeiting and alteration and other means of fraudulently winning, security of drawings among entries or finalists, computer security, data communications security, database security, security in distribution, security involving validation and payment procedures, security involving unclaimed prizes, security aspects applicable to each particular lottery game, security of drawings in lottery games where winners are determined by drawings of numbers, the completeness of security against locating winners in lottery games with preprinted winners by persons involved in their production, storage, distribution or sale and any other aspects of security applicable to any particular lottery game and to the state lottery and its operations. The portion of the report containing the overall evaluation of the state lottery in terms of each aspect of security shall be presented to the commission, the Governor, the Attorney General, the Secretary of State, the State Treasurer and the Legislative Assembly. Notwithstanding other provisions of state law, the portion of the report containing specific recommendations shall be confidential and shall be presented only to the commission, the Governor and the director. Similar studies of security shall be conducted biennially thereafter.

(7) The director may delegate to any of the employees of the Oregon State Lottery the exercise or discharge in the director’s name of any power, duty or function of whatever character, vested in or imposed by law upon the director. The official act of any such person so acting in the director’s name and by the authority of the director shall be considered to be an official act of the director. [1985 c.2 § 3(10) to (16); 1985 c.302 § 3(11) to (17); 1991 c.30 § 2; 1997 c.625 § 1]