2023 Colorado Revised Statutes › Title 44 - REVENUE - REGULATION OF ACTIVITIES (§§ 44-1-101 — 44-50-1001) › LOTTERY (§§ 44-40-101 — 44-50-1001) › Article 40 - STATE LOTTERY DIVISION (§§ 44-40-101 — 44-40-123) › Section 44-40-113 - Prizes

(1)
The right of any person to a prize is not assignable; except that payment of any prize may be paid to:
(a)
The estate of a deceased prizewinner; or
(b)
Any person pursuant to a voluntary assignment of the right to receive future annual prize payments, in whole or in part, if the assignment is made pursuant to an appropriate judicial order of the district court located in the city and county of Denver or the judicial district where the assignor resides or where the commission's headquarters are located.
(2)
(a)
A copy of the petition for an order described in subsection (1)(b) of this section and of all notices of any hearing in the matter shall be served on the executive director no later than ten days prior to any hearing or entry of any order.
(b)
The commission may intervene as of right in any proceeding solely to protect the interests of the commission but shall not be deemed an indispensable or necessary party.
(c)
The court receiving the petition is authorized to issue an order approving the assignment and directing the executive director to pay to the assignee all future prize payments so assigned upon finding that all of the following conditions have been met:
(I)
The assignment has been memorialized in writing and executed by the assignor and is subject to Colorado law;
(II)
The assignor provides a sworn declaration to the court attesting to the facts that the assignor has had the opportunity to be represented by independent legal counsel in connection with the assignment, has received independent financial and tax advice concerning the effects of the assignment, and is of sound mind and not acting under duress; and
(III)
The proposed assignment does not and will not include or cover payments or portions of payments subject to offsets pursuant to subsection (6) of this section, unless appropriate provision is made in the order to satisfy the obligations giving rise to the offset.
(d)
Within ten days of receipt of a certified copy of a court order granted pursuant to this subsection (2), the executive director shall acknowledge in writing to both the assignor and the assignee the executive director's agreement to make the payments in accordance with the provisions of the order. The executive director shall make the payments pursuant to said order.
(e)
The commission shall not adopt rules for the implementation of this subsection (2) that are more restrictive than the provisions of this subsection (2), that impose requirements in addition to those set forth in this subsection (2), or that are inconsistent with the expressed intent of the general assembly.
(f)
The executive director is authorized to establish a reasonable fee to defray any administrative expenses of the executive director associated with assignments made pursuant to this section. The fee amounts shall reflect the direct and indirect costs associated with processing the assignments.
(3)
Notwithstanding any provision of this article 40 to the contrary, the commission may authorize licensed sales agents to retain all prizes pursuant to the rules of the commission for the persons entitled to the prizes for one hundred eighty days after the termination dates of the lottery games for which the prizes were won. The prizes shall be held in trust on behalf of the division for payment to the persons so entitled. No separate accounting of the prizes needs to be made by the licensed sales agent unless requested by the director. Any person who fails to claim a prize during the one-hundred-eighty-day period shall forfeit all rights to the prize, and the amount of the prize shall become the property of the licensee. All other unclaimed prizes shall be retained by the division for the persons entitled to the prizes for the one-hundred-eighty-day period. Any person who fails to claim a prize that is held by the division or its designee during that time shall forfeit all rights to the prize, and the amount of the prize shall remain in the lottery fund.
(4)
The division shall be discharged of all liability upon the payment of any prize pursuant to this article 40.
(5)
Any prize won by a person under eighteen years of age who purchased a winning ticket in violation of section
44-40-116(1)(c)
shall be forfeited. If a person otherwise entitled to a prize or a winning ticket is under eighteen years of age, the director may direct payment of the prize by delivery to an adult member of the minor's family or a guardian of the minor of a check or draft payable to the order of the minor.
(6)
(a)
Prior to the payment of any lottery cash prize or noncash prize required by rule of the commission to be paid only at the lottery offices and subject to state and federal tax reporting, the department of revenue shall require the winner to submit the winner's social security number and federal employer identification number, if applicable, and shall check the social security number of the winner with those certified by the department of human services for the purpose of the state lottery winnings offset as provided in section
26-13-118
. For a lottery cash prize, beginning January 1, 2012, the department of revenue shall also check the social security number of the winner with those certified by the department of personnel for the purpose of the state lottery winnings offset as provided in section
24-30-202.7
. The social security number and the federal employer identification number shall not become part of the public record of the department of revenue. If the social security number of a lottery winner appears among those certified by the department of human services, the department of revenue shall obtain the current address of the winner, notify the department of human services, and suspend the payment of the cash prize or noncash prize until the requirements of section
26-13-118
are met. If, after consulting with the department of human services, the department of revenue determines that the lottery winner owes a child support debt or child support costs pursuant to section
14-14-104
, or owes child support arrearages as part of an enforcement action pursuant to article
5
of title
14
, or owes child support arrearages or child support costs that are the subject of enforcement services provided pursuant to section
26-13-106
, then the department of revenue shall withhold from the amount of the cash prize paid to the lottery winner an amount equal to the amount of child support debt, child support arrearages, and child support costs that are due or, if the amount of the cash prize is less than or equal to the amount of child support debt, arrearages, and costs due, shall withhold the entire amount of the lottery cash prize. Any cash prize so withheld for the department of human services shall be transmitted to the state treasurer for disbursement by the department of human services as directed in section
26-13-118
. If the social security number of a lottery cash prize winner appears among those certified by the department of personnel, the department of revenue shall obtain the current address of the winner, notify the department of personnel, and suspend the payment of the cash prize until the requirements of section
24-30-202.7
are met. If, after consulting with the department of personnel, the department of revenue determines that the lottery winner owes an outstanding debt that has been certified pursuant to section
24-30-202.7
, then the department of revenue shall withhold from the amount of the cash prize paid to the lottery winner an amount equal to the amount of the outstanding debt or, if the amount of the cash prize is less than or equal to the amount of the outstanding debt, shall withhold the entire amount of the lottery cash prize. Any cash prize so withheld for the department of personnel shall be transmitted to the state treasurer for disbursement in accordance with section
24-30-202.7(4)
.
(b)
A lottery winner of a noncash prize who owes child support debt, child support arrearages, or child support costs shall forfeit the prize, unless:
(I)
(A)
All of the child support debt, child support arrearages, and child support costs are paid by the lottery winner within ten working days after claiming the suspended noncash prize; and
(B)
The department of human services has notified the department of revenue that payment has been received; or
(II)
An administrative review is requested pursuant to section
26-13-118(2)
, and the requirements set forth in subsection (6)(c) of this section are met.
(c)
If an administrative review is requested pursuant to section
26-13-118(2)
, the noncash prize shall remain suspended until the department of human services notifies the department of revenue that the administrative review process has been completed pursuant to rules of the state board of human services. If at the administrative review it is determined that the winner owes child support debt, child support arrearages, or child support costs, the winner shall forfeit the noncash prize unless:
(I)
The winner pays the child support debt, child support arrearages, and child support costs in full within ten days after the date of the letter informing the lottery winner of the results of the administrative review; and
(II)
The department of human services notifies the department of revenue that payment has been received.
(d)
If forfeited by the lottery winner, the noncash prize shall be sold at fair market value. The proceeds of the sale shall be transmitted to the state treasurer for disbursement in accordance with the requirements of section
26-13-118(3)
.
(e)
(I)
Notwithstanding any provision of this subsection (6) to the contrary, if, in addition to owing an outstanding debt, a lottery winner owes restitution, fines, fees, costs, or surcharges, as described in section
44-40-114
or a child support debt or arrearages or child support costs as described in this subsection (6), any lottery winnings offset against the restitution, fines, fees, costs, or surcharges, or child support debt or arrearages or child support costs shall take priority and be applied first. If, in such instance, the lottery winner owes these types of debts, these offsets shall take priority and the provisions of section
44-40-114(3)
shall apply.
(II)
The remaining lottery winning money, if any, after the offsets described in subsection (6)(e)(I) of this section shall be applied toward the payment of outstanding debt and processed in accordance with this section.
(7)
Notwithstanding any provision of this section to the contrary, all or any part of a prize won by a person may be pledged as collateral for a loan; however, the pledging of all or any part of the prize creates no liability to the state of Colorado.
Amended by 2019 Ch. 390,§ 73, eff. 8/2/2019.
Amended by 2019 Ch. 238,§ 3, eff. 8/2/2019.
Renumbered from C.R.S. § 24-35-212 and amended by 2018 Ch. 31,§ 2, eff. 10/1/2018.
L. 2018: Entire article added with relocations, (HB 18-1027), ch. 31, p. 353, § 2, effective October 1.
This section is similar to former § 24-35-212 as it existed prior to 2018.