(a) There is hereby established in the state treasury the lottery prize payment fund.

(b) The executive director shall certify periodically to the director of accounts and reports such amounts as the executive director determines necessary to pay prizes to the holders of valid winning lottery tickets or shares or for the purchase of nonmonetary prizes. Upon receipt of such certification, the director of accounts and reports shall transfer the amount certified from the lottery operating fund to the lottery prize payment fund. Moneys credited to the fund shall be expended only for:

(1) The payment of prizes to the holders of valid winning lottery tickets or shares;

(2) the reimbursement of retailers who have paid holders of winning tickets or shares;

(3) the purchase of nonmonetary prizes; or

(4) purposes otherwise specifically authorized by law.

(c) Prior to making any expenditure for reimbursement of a retailer or payment of a prize of $50 or more, the executive director shall cause all proposed prize payments to be matched against the state debtor files maintained by the director of accounts and reports and shall certify and pay or deliver any matched prize or the cash amount thereof to the director of accounts and reports for setoff as prescribed under Kan. Stat. Ann. § 75-6201 et seq., and amendments thereto.

(d) Expenditures from the lottery prize payment fund shall be made in accordance with appropriations acts upon warrants of the director of accounts and reports, or a person designated by the director of accounts and reports pursuant to Kan. Stat. Ann. § 75-3732, and amendments thereto, issued pursuant to vouchers approved by the executive director, or a person designated by the executive director.