Summary of Proposed TGWG Changes to Part 547 

Page 1 of 16 

THE GRANDFATHER PROVISION

Current Text Proposed Changes 

§ 547.4 How does a tribal government, tribal gaming

regulatory authority, or tribal gaming operation 

comply with this part? 

(a) Limited immediate compliance. A tribal gaming 

regulatory authority shall: 

(1) Require that all Class II gaming system software that 

affects the play of the Class II game be submitted,

together with the signature verification required by § 

547.8(f), to a testing laboratory recognized pursuant to 

paragraph (f) of this section within 120 days after

November 10, 2008; 

*** 

(b) Grandfather provisions. All Class II gaming systems 

manufactured or placed in a tribal facility on or before the 

effective date of this part and certified pursuant to 

paragraph (a) of this section are grandfathered Class II 

gaming systems for which the following provisions apply: 

(1) Grandfathered Class II gaming systems may continue 

in operation for a period of five years from November 10, 

2008. 

§ 547.4 How does a tribal government, tribalgaming

regulatoryauthorityTGRA, or tribal gaming operation 

comply with this part? 

(a) (a) Limited immediate compliance. A tribal gaming

regulatory authorityTGRA shall: 

(1)Require that all Class II gaming system software that 

affects the play of the Class II game and were in operation 

prior to November 10, 2008 be submitted, together with 

the signature verification required by § 547.8(f), to a 

testing laboratory recognized pursuant to paragraph (f) of 

this section within 120 days after November 10, 2008.

*** 

(b) (b) Grandfather provisions. All Class II gaming 

systems manufactured or placed in a tribal facility on or 

before the effective date of this part and certified pursuant 

to paragraph (a) of this section are grandfathered Class II 

gaming systems for which the following provisions apply: 

(1) Grandfathered Class II gaming systems may continue

in operation for a period of five years from November 10, 

2008.

EFFECT OF CURRENT PROVISION: 

The grandfather provision addressed existing Class II systems that did not meet all of the 

requirements of the Technical Standards. TGRAs could grandfather existing systems if 

within 120 days after the effective date of the Technical Standards they were submitted to 

testing labs, and soon after were tested for compliance with certain basic fairness and 

integrity standards. Grandfathered systems can remain in use for five years. 

EFFECT OF AMENDMENT: 

The amendment appears to remove the five-year sunset provision and allow grandfathered 

games to remain in use indefinitely without having to comply with the Technical 

Standards. The amendment also appears to expand the existing set of grandfathered 

systems. Under the current regulations, if a system was in operation prior to the effective 

date of the Technical Standards, it had to be submitted to a testing laboratory by March 10, 

2009, to be grandfathered. The amendment removes that time requirement. Under the 

proposal, it appears that a non-compliant system that was in use before November 2008 

and that was not submitted for testing before March 10, 2009, could be submitted and 

grandfathered now. The number of grandfathered systems this change would make 

available for play is not known. 

SEE PREAMBLE DISCUSSION OF GRANDFATHERING AT: 73 FR 60511, 60513, 60515, 60521. 

ALSO SEE ATTACHMENT: 

• NIGC bulletin 2008-3, Compliance guidance for new technical standards, 25 C.F.R. part 

547 
Summary of Proposed TGWG Changes to Part 547 

Page 2 of 16 

THE GRANDFATHER PROVISION (CONTINUED) 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: Submission under this provision was restricted to TGRAs and only 

provided for games in active operation on the effective date. Accordingly, manufacturers 

who may have had inactive games that would otherwise qualify for grandfather status 

would not have been able to qualify such games for grandfather status. To ensure that 

tribes are able to take advantage of all Class II systems eligible for grandfather status, we 

propose the foregoing revision to this sub-section. We further note that any concerns with 

system integrity are addressed by the non-waive able provision governing the integrity of 

the grandfathered systems set forth in subpart 547.4.
Summary of Proposed TGWG Changes to Part 547 

Page 3 of 16 

MINIMUM PROBABILITY STANDARDS

Current Text Proposed Changes 

§ 547.5 What are the rules of interpretation and of

general application for this part? 

*** 

(c) Fairness. No Class II gaming system shall cheat or 

mislead users. All prizes advertised shall be available to 

win. No progressive prize shall have a probability of 

winning less than 1 in 100,000,000. No other prize shall 

have a probability of winning less than 1 in 50,000,000. 

§ 547.4 How does a tribal government, tribal gaming

regulatory authority, or tribal gaming operation 

comply with this part? 

(a) Limited immediate compliance. A tribal gaming 

regulatory authority shall: 

*** 

(2) Require that the testing laboratory test the submission 

to the standards established by § 547.8(b), § 547.8(f), § 

547.14, the minimum probability standards of § 547.5(c), 

and to any additional technical standards adopted by the 

tribal gaming regulatory authority; 

§ 547.5 What are the rules of interpretation and of 

general application for this part? 

*** 

(c) (c) Fairness. No Class II gaming system shall cheat or 

mislead users. All prizes advertised shall be available to 

win during the game. No progressive prize shall have a 

probability of winning less than 1 in 100,000,000. No

other prize shall have a probability of winning less than 1

in 50,000,000.Test laboratory shall calculate and/or verify 

the mathematical expectations of game play, where 

applicable, in accordance with the manufacturer stated 

submission. The results shall be included in the test 

laboratory’s report to the TGRA.

§ 547.4 How does a tribal government, tribal

gaming regulatoryauthorityTGRA, or tribal gaming 

operation comply with this part? 

(a) (a) Limited immediate compliance. A tribal gaming

regulatory authorityTGRA shall: 

*** 

 (2) (2) Require that the testing laboratory test the 

submission to the standards established by § 547.8(b), § 

547.8(f), § 547.14, the minimum probability standards of

§ 547.5(c), and to any additional technical standards 

adopted by the tribal gaming regulatory authority;TGRA; 

EFFECT OF CURRENT PROVISION: 

Requires the chances of hitting any particular pattern or award be no less than 1 in 

50,000,000. Requires the chances of hitting a progressive pattern or award be no less than 1 

in 100,000,000. Prohibits, as a matter of fairness, advertising awards that will never be hit 

because the odds against are so great. Grandfathered systems must comply. 

EFFECT OF AMENDMENT: 

The amendment appears to remove the minimum probability requirement for individual 

awards on all new and grandfathered systems and appears to allow games to offer more 

patterns and more prizes, some of which may have odds above 1 in 100,000,000. This 

change appears to have no direct effect on payouts. However, because it appears that 

manufacturers could offer more low probability awards, they could offer games with more 

precise, less fluctuating payout percentages. 

The amendment also appears to create a new requirement that manufacturer disclose to 

the testing laboratory a mathematical analysis showing the overall percentage return of 

game and that the lab verify the analysis. The lab must include the analysis and its 

verification in its report to the TGRA. Currently, TGRAs may not always receive this 

analysis. 

PREAMBLE DISCUSSION OF MINIMUM PROBABILITY PROVISIONS AT: 73 FR 60522 
Summary of Proposed TGWG Changes to Part 547 

Page 4 of 16 

MINIMUM PROBABILITY STANDARDS (CONTINUED) 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: This correctly states the terms applicable to the game of Bingo where use 

of the term mathematical probability standards is incorrect. In Bingo, it is appropriate to 

require the manufacturer to disclose to TGRA the mathematical expectations of the game 

and to have the laboratories such mathematical expectations. In the existing rule the NIGC 

included an admittedly arbitrary probability standard that unfairly operates to limit game 

design and is not consistent with the probability standards applicable to most, if not all, 

charitable bingo operations and state lotteries. 
Summary of Proposed TGWG Changes to Part 547 

Page 5 of 16 

COMPLIANCE WITH FCC RADIO INTERFERENCE STANDARDS AND UL CERTIFICATION

Current Text Proposed Changes 

§ 547.7 What are the minimum technical hardware 

standards applicable to Class II gaming systems? 

(a) General requirements. (1) The Class II gaming system 

shall operate in compliance with applicable regulations of 

the Federal Communications Commission. 

(2) Prior to approval by the tribal gaming regulatory 

authority pursuant to § 547.4I, the Class II gaming system 

shall have obtained from Underwriters’ Laboratories, or 

its equivalent, relevant certification(s) required for 

equipment of its type, including but not limited to

certifications for liquid spills, electromagnetic 

interference, etc. 

§ 547.7 What are the minimum technical hardware 

standards applicable to Class II gaming systems? 

(a) Generalrequirements. (1) The Class II gaming system

shall operate in compliance with applicable regulations of

the Federal Communications Commission.

(2) Prior to approval by the tribal gaming regulatory

authority pursuant to § 547.4I, the Class II gaming system

shall have obtained from Underwriters’ Laboratories, or its

equivalent, relevant certification(s) required for equipment

of its type, including but not limited to certifications for

liquid spills, electromagnetic interference, etc.

§ 547.4 How does a tribal government, tribal

gaming regulatoryauthorityTGRA, or tribal gaming 

operation comply with this part? 

(a) (a) Limited immediate compliance. A tribal gaming

regulatory authorityTGRA shall: 

 

(3) (3) Require that the testing laboratory provide the 

tribal gaming regulatory authorityTGRA with a formal 

written report setting forth and certifying to the findings 

and conclusions of the test; 

(i) The testing laboratory’s written report shall note the 

submission of any other compliance with applicable 

federal laws or regulations.

 

 

EFFECT OF CURRENT PROVISION: 

Requires gaming system to comply with FCC regulations concerning radio interference and 

have UL or equivalent safety certification. 

EFFECT OF AMENDMENT: 

The amendment appears to remove these requirements from Technical Standards. As 

compliance is required by other federal law, however, the amendment would require a 

laboratory to note compliance in its report to the TGRA. 

PREAMBLE DISCUSSION OF FCC AND UL STANDARDS AT: NONE

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: Other federal agencies are responsible for establishing and enforcing 

electrical product safety standards. Accordingly, promulgation of such standards is beyond 

the scope of NIGC jurisdiction. However, sub-part 547.4 (a)(3)(i) is proposed above to 

reflect that it is industry standard for the laboratories to make note or include other 

laboratory certifications as provided by the manufacturer in their report. 
Summary of Proposed TGWG Changes to Part 547 

Page 6 of 16 

TESTING LABORATORIES

Current Text Proposed Changes 

§ 547.4 How does a tribal government, tribal gaming

regulatory authority, or tribal gaming operation 

comply with this part? 

*** 

(f) Testing laboratories. (1) A testing laboratory may 

provide the examination, testing, evaluating and reporting 

functions required by this section provided that: 

(i) It demonstrates its integrity, independence and

financial stability to the tribal gaming regulatory

authority. 

(ii) It demonstrates its technical skill and capability to the 

tribal gaming regulatory authority. 

(iii) It is not owned or operated by the same tribe or tribal 

gaming regulatory authority for whom it is providing the 

testing, evaluating, and reporting functions required by 

this section. 

*** 

§ 547.4 How does a tribal government, tribalgaming

regulatoryauthorityTGRA, or tribal gaming operation 

comply with this part? 

*** 

(f) Testing laboratories. (1) A testing laboratory may 

provide the examination, testing, evaluating and reporting 

functions required by this section provided that: 

(i) It demonstrates its integrity, independence and 

financial stability to the tribal gaming regulatory

authority.TGRA. 

(ii) It demonstrates its technical skill and capability to the 

tribal gaming regulatory authority.TGRA. 

(iii) ItIf the testing laboratory is not owned or operated by 

the same tribe or tribal gaming regulatory authoritytribe 

the testing laboratory must be independent from the

manufacturer and gaming operator for whom it is 

providing the testing, evaluating, and reporting functions 

required by this section. 

EFFECT OF CURRENT PROVISION: 

Sets out standards for TGRA approval of testing laboratories. Contains a provision 

prohibiting a lab from testing for a tribe if the lab is owned by the tribe. 

EFFECT OF AMENDMENT: 

The amendment allows a tribally owned testing lab to test for its tribe so long as it is 

independent of the gaming operation and the manufacturer of the systems it tests. Some 

tribes have testing labs they use for internal testing and compliance of games and 

promotions, but we are not aware of whether they perform testing services for other 

jurisdictions. 

PREAMBLE DISCUSSION OF TESTING LABORATORIES AT: 73 FR 60521-60522. 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: The existing rule improperly restricts tribes from owning or operating test 

laboratories. The proposed revision corrects this problem, while at the same time ensuring 

independence and the appropriate segregation of function. 
Summary of Proposed TGWG Changes to Part 547 

Page 7 of 16 

MONEY HANDLING: ACCEPTORS, STORAGE, AND DISPENSERS

Current Text Proposed Changes 

§ 547.7 What are the minimum technical hardware 

standards applicable to Class II gaming systems? 

*** 

(g) Financial instrument storage components. Any Class 

II gaming system components that store financial 

instruments and that are not operated under the direct 

control of a gaming operation employee or agent shall be 

located within a secure and locked area or in a locked 

cabinet or housing that is of a robust construction

designed to resist determined illegal entry and to protect 

internal components. 

(h) Financial instrument acceptors. (1) Any Class II 

gaming system components that handle financial 

instruments and that are not operated under the direct 

control of an agent shall: 

(i) Be located within a secure, locked and tamper-evident 

area... 

*** 

(i) Financial instrument dispensers. (1) Any Class II 

gaming system components that dispense financial 

instruments and that are not operated under the direct 

control of a gaming operation employee or agent shall: 

(i) Be located within a secure, locked and tamper-evident 

area...

§ 547.7 What are the minimum technical hardware 

standards applicable to Class II gaming systems? 

***

(g) (f) Financial instrument storage components. Any 

Class II gaming system components that store financial 

instruments and that are not designed to be operated under 

the direct control of a gaming operation employee or 

agent shall be located within a secure and locked area or 

in a locked cabinet or housing that is of a robust 

construction designed to resist determined illegal entry 

and to protect internal components. 

(h) (g) Financial instrument acceptors. (1) Any Class II 

gaming system components that handle financial 

instruments and that are not designed to be operated under 

the direct control of an agent shall: 

(i) Be located within a secure, locked and tamperevident area ... 

*** 

(ih) Financial instrument dispensers. (1) Any Class II 

gaming system components that dispense financial 

instruments and that are not designed to be operated under 

the direct control of a gaming operation employee or 

agent shall: (i) Be located within a secure, locked and 

tamper-evident area ...

EFFECT OF CURRENT PROVISION: 

Requires that a cash box, bill acceptor, ticket printer, cash drawer, or anything else that 

accepts, stores, or dispenses cash or a cash equivalent be within a secure, locked, tamperevident enclosure if it is automated. If staffed, the security requirements are not as 

stringent. The effect is that bill acceptors and cash boxes have to be within a secure and 

locked compartment within a cabinet, but a cash drawer for a live bingo game does not. 

EFFECT OF AMENDMENT: 

The amendment requires that a component be within a secure, locked, tamper-evident 

enclosure if it is designed to be automated, regardless of how it is actually used. It requires 

lesser security requirements for cash drawers and the like if designed to be staffed. 

PREAMBLE DISCUSSION OF MONEY ACCEPTORS, STORAGE UNITS, AND DISPENSER SECURITY AT: 73 FR 60523. 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: Technical Standards should only cover the design of the component; 

operation of the component should be covered in the MICS 
Summary of Proposed TGWG Changes to Part 547 

Page 8 of 16 

ENTERTAINING DISPLAYS

Current Text Proposed Changes 

§ 547.8 What are the minimum technical software 

standards applicable to Class II gaming systems? 

This section provides general software standards for 

Class II gaming systems for the play of Class II games. 

(a) Player interface displays. 

*** 

(2) Between plays of any game and until the start of the 

next play, or until the player selects a new game option 

such as purchase or wager amount or card selection, 

whichever is earlier, if not otherwise provided to the 

player, the player interface shall display: 

*** 

(ii) The final results for the last game played, including 

entertaining displays of results, if any; and... 

*** 

(d) Last game recall. The last game recall function shall: 

*** 

(2) Display the results of recalled games as originally 

displayed or in text representation, including entertaining 

display results implemented in video, rather than electromechanical, form, if any, so as to enable the tribal 

gaming regulatory authority or operator to clearly 

identify the game sequences and results that occurred. 

*** 

(4) Provide the following information for the current and 

previous four games played and shall display: 

*** 

(E) All prizes won by the player, including winning 

patterns and entertaining displays implemented in video, 

rather than electro-mechanical form, if any...

§ 547.8 What are the minimum technical software 

standards applicable to Class II gaming systems? 

This section provides general software standards for Class 

II gaming systems for the play of Class II games, 

including where applicable games similar to bingo.

(a) (a) Player interface displays. 

*** 

(2) Between plays of any game and until the start of the 

next play, or until the player selects a new game option 

such as purchase or wager amount or card selection,

whichever is earlier, if not otherwise provided to the 

player, the player interface shall display: 

*** 

(ii) The final results for the last game played, including

entertaining displays of results, if any; 

*** 

(d) (d) Last bingo game play recall. The last bingo game 

play recall function shall: 

*** 

(2) (2) Display the results of recalled bingo games play

as originally displayed or in text representation , including

entertaining display results implemented in video, rather

than electro-mechanical,form, if any, so as to enable 

thetribal gaming regulatory authority TGRA or operator 

to clearly identify the bingo game play sequences and 

results that occurred 

*** 

(4) (4) Provide the following information for the current 

and previous four bingo games played plays and shall 

display: 

*** 

(E) All prizes won by the player, including winning

patterns and entertaining displays implemented in video,

rather than electro- mechanical form, if any... 

EFFECT OF CURRENT PROVISION: 

Entertaining displays are the symbols and reels displayed as adjuncts to bingo games and 

games similar to bingo. These sections require the system treat the results shown on 

entertaining displays as game results. They must be displayed as results between games 

like any other results, and they must available to casino staff and regulators through game 

information recall for purposes of inspection and resolving disputes. 

EFFECT OF AMENDMENT: 

The amendment appears to eliminate all requirements to recall entertaining displays. 

PREAMBLE DISCUSSION OF ENTERTAINING DISPLAYS AT: 73 FR 60523-24. 
Summary of Proposed TGWG Changes to Part 547 

Page 9 of 16 

ENTERTAINING DISPLAYS (CONTINUED) 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: In Bingo gaming systems, game outcome is displayed on the bingo card 

located on the player interface which is independent of, and separate from, any 

entertaining display. Because an entertaining display cannot in anyway affect the player 

outcome of the game, it is irrelevant for regulatory purposes. Furthermore, inclusion of 

regulatory language concerning entertaining displays creates a false appearance of legal 

relevancy that enhances the potential for patron disputes. We, therefore, have proposed 

the removal of this language. 
Summary of Proposed TGWG Changes to Part 547 

Page 10 of 16 

REFLEXIVE SOFTWARE

Current Text Proposed Changes 

§ 547.3 What are the definitions for this part? For the 

purposes of this part, the following definitions apply: 

*** 

Reflexive software. Any software that has the ability to 

manipulate and/or replace a randomly generated outcome 

for the purpose of changing the results of a Class II 

game. 

§ 547.8 What are the minimum technical software 

standards applicable to Class II gaming systems? 

*** 

(b) Game initiation and play. (1) Each game played on 

the Class II gaming system shall follow and not deviate 

from a constant set of rules for each game provided to 

players pursuant to § 547.16. Any change in rules 

constitutes a different game. There shall be no automatic 

or undisclosed changes of rules. 

(2) For bingo games and games similar to bingo, the 

Class II gaming system shall not alter or allow to be 

altered the card permutations or game rules used for play 

of a Class II game unless specifically chosen by the 

player prior to commitment to participate in the game. 

No duplicate cards shall be sold for any common draw. 

§ 547.3 What are the definitions for this part? 

*** 

Reflexive Software,software. Any software that has the 

ability to manipulate and/or replace a randomly generated 

outcome for the purpose of changing the results of a Class 

II game or deprives a player of a prize to which the player 

is otherwise entitled based on the random outcome of the 

game. 

§ 547.8 What are the minimum technical software 

standards applicable to Class II gaming systems? 

*** 

(b) (b) Game initiation and play. (1) Each game played 

on the Class II gaming system shall follow and not 

deviate from a constant set of rules for each game 

provided to players pursuant to § 547.16. Any change in

rules constitutes a different game. There shall be no

automatic or undisclosed changes of rules. 

(2) For bingo games and games similar to bingo,The Class 

II gaming system shall not alter or allow to be altered the 

card permutations or game rules used for play of a Class 

II game unless specifically chosen by the player prior to 

commitment to participate in the game. No duplicate

cards shall be sold for any common draw. 

EFFECT OF CURRENT PROVISION: 

These provisions were intended to address fairness. They require games to display exactly 

what the random number generator selects. This prevents two schemes. Games cannot 

detect a losing pattern and then, instead of just displaying it, deliberately change the 

display to show that the patron just missed a big prize. The provisions also provide that 

games cannot track a patron’s performance and then, without telling the player, change 

the game to increase or decrease the available prizes or the chances of winning. 

EFFECT OF AMENDMENT: 

The amendment clarifies and strengthens the definition of reflexive software to prevent the 

first scheme. Section 547.8(b) can be, but is not necessarily, read to prevent the second 

scheme. 

PREAMBLE DISCUSSION OF REFLEXIVE SOFTWARE: NONE

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: The added language makes this definition more consistent with the 

industry understanding of reflexive technology. The proposed language operates to clearly 

identify the harm the provision is intended to prevent 
Summary of Proposed TGWG Changes to Part 547 

Page 11 of 16 

DOWNLOADABLE SOFTWARE

Current Text Proposed Changes 

§ 547.12 What are the minimum technical standards 

for downloading on a Class II gaming system? 

*** 

(b) Verifying downloads. Following download of any 

game software, the Class II gaming system shall verify 

the downloaded software using a software signature 

verification method that meets the requirements of § 

547.8(f). Using any method it deems appropriate, the 

tribal gaming regulatory authority shall confirm the 

verification. 

§ 547.12 What are the minimum technical standards 

for downloading on a Class II gaming system? 

*** 

(b) (b) Verifying downloads. Following download of any

gameDownloaded software, the on a Class II gaming 

system shall verify the downloaded softwarebe verified by 

the Class II gaming system using a software signature 

verification method that meets the requirements of § 

547.8(f). Using any method it deems appropriate, the

tribal gaming regulatory authority shall confirm the

verification.

EFFECT OF CURRENT PROVISION: 

Software download from a server to client machines is, by design, automatically tested for 

integrity by the system. The current provision requires the TGRA to check the system 

verification in a manner it deems appropriate. 

EFFECT OF AMENDMENT: 

The amendment would delete the requirement, presumably to place it within the Class II 

MICS [543.16]. As a requirement for TGRA checking is not something a laboratory can test, 

the requirement is appropriately placed within internal controls. 

PREAMBLE DISCUSSION OF TGRA DOWNLOADABLE SOFTWARE CHECK AT: 73 FR 60525. 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: The last sentence was removed because it is a MICS issue and is addressed 

in the TGWG proposed draft part 543. 
Summary of Proposed TGWG Changes to Part 547 

Page 12 of 16 

RANDOM NUMBER GENERATION

Current Text Proposed Changes 

§ 547.14 What are the minimum technical standards 

for electronic random number generation? 

*** 

(b) Statistical Randomness. 

*** 

(2) Numbers produced by an RNG shall pass the 

statistical tests for randomness to a 99% confidence level, 

which may include: 

(i) Chi-square test; 

(ii) Equi-distribution (frequency) test; 

(iii) Gap test; 

(iv) Poker test; 

(v) Coupon collector’s test; 

(vi) Permutation test; 

(vii) Run test (patterns of occurrences shall not be 

recurrent); 

(viii) Spectral test; 

(ix) Serial correlation test potency and degree of serial 

correlation (outcomes shall be independent from the

previous game); and 

(x) Test on subsequences. 

*** 

(e) General requirements 

*** 

(5) The Class II gaming system shall neither adjust the 

RNG process or game outcomes based on the history of 

prizes obtained in previous games nor make any reflexive 

or secondary decision that affects the results shown to the 

player or game outcome. Nothing in this paragraph shall 

prohibit the use of entertaining displays. 

*** 

(f) Scaling algorithms and scaled numbers. An RNG that 

provides output scaled to given ranges shall: 

*** 

(4) Use an unbiased algorithm. A scaling algorithm is 

considered to be unbiased if the measured bias is no 

greater than 1 in 100 million. 

§ 547.14 What are the minimum technical standards 

for electronic random number generation? 

*** 

(b) Statistical Randomness.

*** 

(2) Numbers or other designations produced by an RNG 

shall pass the statistical tests for randomness to a 99% 

confidence level., which may include:

(i) Mandatory statistical tests for randomness to include:

(A) Chi-square test; 

(B) Runs test (patterns of occurrences shall not be 

recurrent); and 

(C) Serial correlation test potency and degree of serial 

correlation (outcomes shall be independent from the

previous game). 

(ii) Optional statistical tests for randomness may include:

(ii) (A) Equi-distribution (frequency) test; 

(iii) (B) Gap test; 

(iv) (C) Poker test; 

(v) (D) Coupon collector’s test; 

(vi) (E) Permutation test; 

(vii) Run test (patterns of occurrences shall not be 

recurrent); 

(viii) (F) Spectral test; 

(ix) Serial correlation test potency and degree of serial 

correlation (outcomes shall be independent from the 

previous game); and 

(x) (G) Test on subsequences. 

*** 

(e) General requirements 

*** 

(5) (5) The Class II gaming system shall neither adjust the

RNG process or game outcomes based on the history of 

prizes obtained in previous games nor makeuse any 

reflexive software or secondary decision that affects the 

results shown to the player or game outcome. In no event 

shall the Class II gaming system deprive a player of a 

prize to which the player is otherwise entitled based on 

the random outcome of the game. Nothing in this 

paragraph shall prohibit theuse of entertaining displays. 

*** 

(f) (f) Scaling algorithms and scaled numbers. An RNG 

that provides output scaled to given ranges shall: 

*** 

4) Use an unbiased algorithm. A scaling algorithm is 

considered to be unbiased if the measured bias is no 

greater than 1 in 100 million.

EFFECT OF CURRENT PROVISION: 

Requires all numbers produced by the system to be statistically random. Leaves choice of 

randomness tests to discretion of the testing laboratory. Requires scaling algorithms to be 

unbiased, but measure of bias at 1 in 100 million is incorrect. 
Summary of Proposed TGWG Changes to Part 547 

Page 13 of 16 

RANDOM NUMBER GENERATION (CONTINUED) 

EFFECT OF AMENDMENT: 

The amendment appears to strengthen RNG statistical testing requirements by mandating 

three industry-standard tests. It leaves the choice of other tests to the discretion of the 

testing laboratory. The amendment also adds a section on reflexive software to the RNG 

section, and it deletes without correcting a requirement that scaling algorithms be 

unbiased. 

PREAMBLE DISCUSSION OF RANDOMNESS TESTING AT: 73 FR 60525 

ATTACHMENT: 

Bulletin 2008-4: Compliance with Technical Standards section 547.14(f)(4), scaling 

algorithms and scaled numbers for electronic random number generators. 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: TGWG wanted to ensure that industry standard RNG tests were mandated. 

Less commonly used tests were not considered adequate. See NIGC “Part 547 Bulletin 2008-

4 Tech Stds RNG correction 110708” 
Summary of Proposed TGWG Changes to Part 547 

Page 14 of 16 

VARIANCES

Current Text Proposed Changes 

§ 547.17 How does a tribal gaming regulatory 

authority apply for a variance from these standards? 

(a) Tribal Gaming Regulatory Authority approval. (1) A 

tribal gaming regulatory authority may approve a variance 

from the requirements of this part if it has determined that 

the variance will achieve a level of security and integrity 

sufficient to accomplish the purpose of the standard it is 

to replace. 

(2) For each enumerated standard for which the tribal 

gaming regulatory authority approves a variance, it shall 

submit to the Chairman within 30 days, a detailed report, 

which shall include the following: 

(i) An explanation of how the variance achieves a level of 

security and integrity sufficient to accomplish the purpose 

of the standard it is to replace; and 

(ii) The variance as granted and the record on which it is 

based. 

(3) In the event that the tribal gaming regulatory authority 

or the tribe’s government chooses to submit a variance 

request directly to the Chairman for joint government to 

government review, the tribal gaming regulatory authority 

or tribal government may do so without the approval

requirement set forth in paragraph (a) (1) of this section. 

(b) Chairman Review. (1) The Chairman may approve or 

object to a variance granted by a tribal gaming regulatory 

authority. 

(2) Any objection by the Chairman shall be in written 

form with an explanation why the variance as approved 

by the tribal gaming regulatory authority does not provide 

a level of security or integrity sufficient to accomplish the 

purpose of the standard it is to replace. 

(3) If the Chairman fails to approve or object in writing 

within 60 days after the date of receipt of a complete 

submission, the variance shall be considered approved by 

the Chairman. The Chairman and the tribal gaming 

regulatory authority may, by agreement, extend this

deadline an additional 60 days. 

(4) No variance may be implemented until approved by 

the tribal gaming regulatory authority pursuant to 

paragraph (a)(1) of this section or the Chairman has 

approved pursuant to paragraph (b)(1) of this section. 

(c) Commission Review. Should the tribal gaming 

regulatory authority elect to maintain its approval after 

written objection by the Chairman, the tribal gaming 

regulatory authority shall be entitled to an appeal to the 

full Commission in accordance with the following 

process: 

(1) Within 60 days of receiving an objection, the tribal 

gaming regulatory authority shall file a written notice of 

appeal with the Commission that may include a request 

for an oral hearing or it may request that the matter be 

decided upon written submissions. 

(2) Within 10 days after filing a notice of appeal the tribal 

gaming regulatory authority shall file a supplemental 

statement specifying the reasons why the tribal gaming 

regulatory authority believes the Chairman’s objection 

should be reviewed, and shall include supporting 

documentation, if any. 

(3) Failure to file an appeal or submit the supplemental

§ 547.17 How does a tribal gaming regulatory authority 

apply for a variance fromthese the standards of this part?

(a) Variance. (1) Should a TGRA grant a variance to any 

provision of these standards, the TGRA shall deliver a 

notice of the same to the Commission within ten (10) days 

of such approval.

(i) The notice shall contain a complete copy of the 

information presented to the TGRA and the variance as 

granted.

(ii) The notice shall be forwarded to the Commission 

within ten (10) days of the granting of the Variance.

 (2) During a thirty (30) day period when the Commission 

first receives the notice required by this subpart, the 

Chairman may request additional information from the 

TGRA concerning the subject of variance. Such request 

shall suspend the thirty (30) day period until the 

Chairman receives the TGRA response.

(b) Commission Review.

 (1) Within the thirty (30) day review period, the 

Commission may:

(i) Advise the TGRA, in writing, that it has no objection.

(ii) Provide the TGRA a written statement itemizing its

objections. 

(iii) Take no action, in which case, the TGRA’s variance 

shall be final. 

(2) If the Commission has provided the TGRA a 

statement itemizing objections to the variance: 

(i) The TGRA shall reconsider the variance taking into 

account the objections itemized by the Commission.

(ii) The TGRA may seek reconsideration by submitting a 

request to the Chairman and members of the Commission.

(iii) Upon receipt of a request for reconsideration, the 

Commission shall conduct an informal hearing with the 

TGRA within 30 days, which may be conducted in person 

or through the exchange of documents, as requested by 

the TGRA.

(iv)After the informal hearing, the Commission must 

issue a written decision within 14 days. If the 

Commission disapproves the variance, such written 

decision must include an explanation of why the 

requested variance creates an imminent threat to the 

integrity of the tribal gaming operation.
Summary of Proposed TGWG Changes to Part 547 

Page 15 of 16 

VARIANCES (CONTINUED) 

statement within the time provided by this section shall 

result in a waiver of the opportunity for an appeal. 

(4) If an oral hearing is requested it shall take place within 

30 days of the notice of appeal and a record shall be 

made. 

(5) If the tribal gaming regulatory authority requests that 

the appeal be decided on the basis of written submission, 

the Commission shall issue a written decision within 30 

days of receiving the supplemental statement. 

(6) The Commission shall uphold the objection of the 

Chairman, only if, upon de novo review of the record 

upon which the Chairman’s decision is based, the 

Commission determines that the variance approved by the 

tribal gaming regulatory authority does not achieve a level 

of security and integrity sufficient to accomplish the 

purpose of the standard it is to replace. 

(7) The Commission shall issue a decision within 30 days 

of the oral hearing unless the tribal gaming regulatory 

authority elects to provide the Commission additional 

time, not to exceed an additional 30 days, to issue a 

decision. In the absence of a decision by the Commission 

within the time provided, the decision of the tribal gaming 

regulatory authority shall be deemed affirmed. 

(8) The Commission’s decision shall constitute final 

agency action.

EFFECT OF CURRENT PROVISION: 

Creates a formal procedure for TGRA to seek variance from Technical Standards modeled 

on variance procedure set out in part 542. After granting variance, within 30 days, TGRA 

submits to NIGC Chair, who has 60 days to approve or object (120 days if the Chairman and 

TGRA agree). Objections may be appealed to full Commission within 60 days of Chair’s 

objection. Commission affirms or reverses within 30 days (plus 30 more by agreement). 

Decisions of the Commission are appealable to federal court. 

EFFECT OF AMENDMENT: 

The amendment would replace the current variance provision in its entirely with a more 

streamlined and less formal provision. After granting a variance, a TGRA has 10 days to 

submit, and the Commission has 30 days to review. If the Commission objects, TGRA must 

reconsider and may seek reconsideration from the Commission, which will review the 

matter by hearing or on the papers. Commission has 14 days after a rehearing to issue a 

decision and may only disapprove if “the requested variance creates an imminent threat to 

the integrity of the tribal gaming operation.” 

 

PREAMBLE DISCUSSION OF VARIANCES AT: 73 FR 60525 

(AS OF 5/13/2011) TRIBAL ALTERNATIVE TECHNICAL STANDARDS JUSTIFICATION FOR UPDATE: 

Remark: Please see transmittal memorandum. (Below)
Summary of Proposed TGWG Changes to Part 547 

Page 16 of 16 

VARIANCES (CONTINUED) 

“...the TGWG has proposed inclusion of a variance subpart, clarifying procedures 

and timeframes for the granting of a variance by tribal gaming regulatory 

authorities, including a mechanism for NIGC concurrence. This subpart is identical 

to the revision proposed in the TGWG’s revised MICS. The TGWG is confident that 

the approach proposed captures both the tribal interest as the primary regulator of 

its gaming activities and the federal interest in providing regulatory oversight in a 

manner that is effective and efficient as well as timely.”