Bill Text: TX HB382 | 2011-2012 | 82nd Legislature | Introduced

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Bill Title: Relating to the authorization and regulation of poker gaming and the duties of the Texas Lottery Commission; providing civil and criminal penalties.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2011-03-29 - Left pending in committee [HB382 Detail]

Download: Texas-2011-HB382-Introduced.html

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82R2222 YDB-F
By: Menendez H.B. No. 382

A BILL TO BE ENTITLED
AN ACT
relating to the authorization and regulation of poker gaming and
the duties of the Texas Lottery Commission; providing civil and
criminal penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle A, Title 13, Occupations Code, is
amended by adding Chapter 2004 to read as follows:
CHAPTER 2004. POKER GAMING
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2004.001. SHORT TITLE; APPLICABILITY. (a) This
chapter may be cited as the Poker Gaming Act of 2011.
(b) This chapter does not apply to the conduct of bingo,
charitable raffles, the state lottery, or video poker.
Sec. 2004.002. PUBLIC POLICY. (a) All poker gaming
conducted in this state and authorized by law shall be regulated and
licensed under this chapter unless state or federal law
specifically provides otherwise.
(b) The legislature finds and declares it to be the public
policy of this state that:
(1) poker is a game of skill and not a lottery or gift
enterprise prohibited by the Texas Constitution;
(2) unregulated poker gaming conducted by unlicensed
operators in public establishments is inimical to the public
health, safety, welfare, and good order. A person in this state may
not offer and has no right to offer the game of poker for profit
except as expressly permitted by the laws of this state;
(3) the development of regulated poker gaming in this
state will benefit the general welfare of the people of this state
by enhancing investment, development, and tourism in this state,
resulting in new jobs and additional revenue to this state;
(4) the conduct of regulated poker gaming by licensed
operators in authorized establishments will not harm the people of
this state;
(5) the regulation of poker gaming in this state is
important to ensure that poker gaming:
(A) is conducted honestly and competitively; and
(B) is free from criminal and other corruptive
elements;
(6) public confidence and trust can be maintained only
by strict regulation of all persons, locations, practices,
associations, and activities related to the conduct of poker gaming
and the poker gaming service industry;
(7) persons owning any interest in an operator
licensed to conduct poker gaming and in distributing materials and
specific equipment relating to poker gaming must be licensed and
controlled to protect the public health, safety, morals, good
order, and general welfare of the people of this state;
(8) certain operators and employees of establishments
authorized to conduct poker gaming and certain manufacturers and
distributors in the poker gaming service industry must be
regulated, licensed, and controlled to accomplish and promote these
public policies while protecting the public health, safety, morals,
good order, and general welfare of the people of this state; and
(9) it is the intent of this chapter, where possible,
to use the resources, goods, labor, and services of the people of
this state in the operation of poker gaming-related amenities to
the extent allowable by law.
Sec. 2004.003. DEFINITIONS. In this chapter:
(1) "Alcoholic beverage" has the meaning assigned by
Section 1.04, Alcoholic Beverage Code.
(2) "Badge" means a form of identification issued by
the commission to identify the holder of a license issued under this
chapter.
(3) "Bet" means an agreement to win or lose chips or
tokens, or an electronic facsimile of either, in a game of poker.
(4) "Bonus program" means a local promotion bonus
program or a statewide bad beat bonus program.
(5) "Cage manager" means an individual who creates and
maintains player accounts, provides cash-in and cash-out of chips
or player accounts, and determines and maintains the amount of
gross receipts tax due and payable to the comptroller by a licensed
operator on each day's gross receipts. The cage manager may be
assisted by an electronic method to perform any of these duties.
(6) "Charitable operator" means a person who holds a
charitable operator's license issued by the commission to conduct a
charitable poker tournament for a licensed nonprofit organization.
(7) "Charitable poker tournament" means a poker
tournament conducted by a charitable operator or commercial
operator to benefit a licensed nonprofit organization.
(8) "Collection fee" means the fee assessed on each
communal pot in accordance with Section 2004.461.
(9) "Commercial operator" means a person who holds a
commercial operator's license issued by the commission under this
chapter.
(10) "Commission" means the Texas Lottery Commission.
(11) "Communal pot" means the total amount of wagers
collectively made during one hand of poker.
(12) "Company" means a corporation, partnership,
limited partnership, trust, association, joint stock company,
joint venture, limited liability company, or other form of business
organization, but does not include a sole proprietorship or natural
person.
(13) "Creditor interest" means a right or claim of any
character against a person for the payment of money borrowed,
whether secured or unsecured, matured or unmatured, liquidated or
absolute, or fixed or contingent, and includes an obligation based
on the person's profits or receipts.
(14) "Dealer" means an individual who deals cards to
players at a poker gaming table on the premises of a licensed
operator.
(15) "Director" means the director of poker gaming
operations of the commission.
(16) "Distilled spirits" has the meaning assigned by
Section 1.04, Alcoholic Beverage Code.
(17) "Electronic poker table" means a poker gaming
table, including its components, that provides multiple player
positions and allows players to play against other players in the
same poker game using electronic representations of cards and
chips.
(18) "Equity interest" means a proprietary interest,
right, or claim in a company that allows the holder either to vote
with respect to matters of organizational governance or to
participate in the profits and residual assets of the company,
including common and preferred stock in a corporation, a general or
limited partnership interest in a partnership, a similar interest
in any other form of business organization, or a warrant, right, or
similar interest convertible into, or to subscribe for, a
proprietary right or claim, with or without the payment of
additional consideration.
(19) "Executive director" means the executive
director of the commission.
(20) "Fidelity bond" means insurance against a
licensed operator's financial loss resulting from theft or
embezzlement by an employee.
(21) "Gross receipts" means the total amount
accumulated from all:
(A) collection fees assessed; and
(B) promotion bonus fees assessed.
(22) "Licensed nonprofit organization" means a
nonprofit organization that holds a license issued by the
commission authorizing the organization to benefit from charitable
poker tournaments conducted on its behalf.
(23) "Licensed operator" means a charitable operator
or a commercial operator.
(24) "Manufacturer" means:
(A) a person who assembles from raw materials or
subparts a completed piece of poker gaming equipment or supplies
for use in poker gaming in this state; or
(B) a person who converts, modifies, adds to, or
removes parts from any poker gaming equipment, item, or assembly to
further its promotion or sale for or use in poker gaming in this
state.
(25) "Net proceeds" means, in relation to the gross
receipts from a charitable poker tournament, the amount remaining
after deducting the reasonable amounts necessarily and actually
expended by a licensed operator to conduct the charitable poker
tournament.
(26) "Nonprofit organization" means an unincorporated
association or a nonprofit corporation formed under the Texas
Nonprofit Corporation Law, as described by Section 1.008, Business
Organizations Code, that:
(A) does not distribute any of its income to its
members, officers, or governing body, other than as reasonable
compensation for services; and
(B) has tax-exempt status under Section
501(c)(3), Internal Revenue Code of 1986.
(27) "Pari-mutuel license holder" means a person
licensed to conduct wagering on a greyhound race or a horse race
under the Texas Racing Act (Article 179e, Vernon's Texas Civil
Statutes).
(28) "Player" means a patron who participates in poker
gaming on the premises of a licensed operator.
(29) "Poker" or "poker game" means a card game in which
players place a bet based on the highest or lowest ranking hand of
cards held or combination of highest and lowest cards held. The
term includes the game known as Texas Hold'em or any variation or
combination of Texas Hold'em, but does not include blackjack,
hearts, pinochle, rummy, Internet poker, video poker, or Asian card
games such as Pai Gow.
(30) "Poker card deck" means a set of 52 cards with 13
values and with each card value represented once in each of four
suits: spades, hearts, diamonds, and clubs.
(31) "Poker gaming" means the conduct of poker games.
(32) "Poker gaming equipment" means any equipment or
mechanical, electromechanical, or electronic contrivance,
component, machine, or device, expendable supply, or other
paraphernalia used in conjunction with poker gaming, including a
computerized system or software for enabling poker gaming or
monitoring poker gaming revenue or a device for weighing or
counting money. The term includes playing cards, gaming chips or
tokens, or a card shuffling device, or an electronic version of any
of those items, including a poker game.
(33) "Premises" means the area subject to the direct
control of and actual use by a licensed operator to conduct poker
gaming. The term includes a location or place.
(34) "Principal manager" means a person who, in
accordance with commission rules, holds or exercises managerial,
supervisory, or policy-making authority over the management or
operation of a poker gaming activity that, in the commission's
judgment, warrants employee licensing as a principal manager for
the protection of the public interest. The term includes a key
executive of a holder of a license issued under this chapter that is
a company and each person controlling the holder that is a company.
(35) "Promotion bonus fee" means the fee assessed on
each communal pot for bonus programs in accordance with Section
2004.460.
(36) "Wager" means a bet.
Sec. 2004.004. STATUS OF POKER AS CLASS II GAMING. Poker
gaming authorized under this chapter is considered Class II gaming
under the Indian Gaming Regulatory Act (Pub. L. No. 100-497).
[Sections 2004.005-2004.050 reserved for expansion]
SUBCHAPTER B. COMMISSION POWERS AND DUTIES
Sec. 2004.051. CONTROL AND SUPERVISION OF POKER GAMING;
POKER DIVISION. (a) The commission shall administer this chapter.
(b) The commission has broad authority and shall exercise
strict control and close supervision over all poker gaming
conducted in this state to ensure that poker gaming is fairly
conducted.
(c) The commission shall execute its authority through a
poker gaming division established by the commission to administer
this chapter.
Sec. 2004.052. DIRECTOR OF POKER GAMING OPERATIONS. (a)
The commission shall employ a director of poker gaming operations.
(b) The director shall administer the poker gaming division
under the direction of the commission.
Sec. 2004.053. OFFICERS AND INVESTIGATORS. The commission
may employ officers or investigators the commission considers
necessary to administer this chapter.
Sec. 2004.054. RULEMAKING AUTHORITY. The commission shall
adopt rules as necessary to enforce and administer this chapter.
Sec. 2004.055. APPROVAL OF POKER GAMING EQUIPMENT. (a) The
commission by rule shall provide procedures for the approval of
poker gaming equipment for use in poker gaming in this state as
authorized under this chapter.
(b) The commission may not approve for use in poker gaming
in this state an electronic poker table or other electronic device
that is capable of displaying an electromechanically or
electronically simulated poker game.
(c) The holder of a license issued under this chapter may
not:
(1) use, sell, or distribute poker gaming equipment
that has not been approved by the commission; or
(2) use, sell, or distribute an electronic poker table
or other device described by Subsection (b).
Sec. 2004.056. PUBLIC INFORMATION. (a) The commission
shall provide to any person on request a printed copy of this
chapter and the rules applicable to the enforcement of this
chapter.
(b) The commission may charge a reasonable fee for a copy
provided under this section.
Sec. 2004.057. ADVISORY OPINIONS. (a) A person may request
from the commission an advisory opinion regarding compliance with
this chapter and commission rules.
(b) The commission shall respond to a request under
Subsection (a) not later than the 60th day after the date a request
is received, unless the commission determines that the request does
not contain sufficient facts to provide an answer on which the
requestor may rely. The commission shall request any additional
information required from the requestor not later than the 10th
business day after the date the request is received. If the
commission requests additional information, the commission shall
respond to the request not later than the 60th day after the date
additional information is received pursuant to the request for
additional information.
(c) A person who requests an advisory opinion under
Subsection (a) may act in reliance on the opinion in the conduct of
any activity under any license issued under this chapter if the
conduct is substantially consistent with the opinion and the facts
stated in the request.
(d) An advisory opinion issued under this section is not a
rule under Subchapter B, Chapter 2001, Government Code, and the
rulemaking requirements of that subchapter do not apply to a
request for an advisory opinion or any advisory opinion issued by
the commission under this chapter.
(e) Nothing in this section precludes the commission from
requesting an attorney general's opinion under Section 402.042,
Government Code. In the event the commission requests an attorney
general's opinion on a matter that is the subject of an advisory
opinion request under this section, the deadlines established under
Subsection (b) are tolled until the 30th day following the date the
attorney general's opinion is issued.
Sec. 2004.058. GENERAL LICENSE PROHIBITION. A person
described by Section 243.007(a), Local Government Code, who holds a
license or other permit issued by a municipality or county as
provided by that section may not:
(1) conduct poker gaming in this state; or
(2) hold a license issued under this chapter.
[Sections 2004.059-2004.100 reserved for expansion]
SUBCHAPTER C. LICENSE TO CONDUCT POKER GAMING
Sec. 2004.101. OPERATOR'S LICENSE REQUIRED; LOCATION AND
TABLE RESTRICTIONS; SEPARATE PERMIT REQUIRED. (a) A person may not
conduct poker gaming in the state unless the person holds a
charitable operator's license or a commercial operator's license
issued by the commission.
(b) Poker gaming conducted by a commercial operator,
including a charitable poker tournament conducted by the operator
to benefit a licensed nonprofit organization, may be conducted only
on premises operating in accordance with the operator's license.
Poker gaming conducted by a charitable operator may be conducted
only at a location specified in a permit authorizing the conduct of
a charitable poker tournament. This subsection does not prohibit a
person from playing a poker game authorized by other state law.
(c) A person may not own an equity interest in a location in
this state at which poker gaming is conducted by a commercial
operator and for which a commercial operator's license is not in
effect.
(d) A separate commercial operator's license must be
obtained for each location at which poker gaming is conducted by a
commercial operator.
(e) If a commercial operator is an Indian tribe that holds a
license issued under Section 2004.103(a)(1)(B), the location at
which poker gaming is conducted under the license must be on the
tribe's reservation in this state.
(f) The commission by rule shall prescribe the maximum
number of poker gaming tables a commercial operator may operate at a
single location licensed by the commission.
(g) A separate permit must be obtained for each charitable
poker tournament conducted by a licensed operator.
Sec. 2004.102. COMMERCIAL OPERATOR'S LICENSE APPLICATION.
(a) In accordance with commission rules, an applicant for a
commercial operator's license shall file with the commission an
application that contains the information identified in
Subsections (b) and (c) and any additional information the
commission requires to determine the suitability and eligibility of
the applicant to conduct poker gaming in this state.
(b) The application must include:
(1) the name and address of the applicant;
(2) the names and addresses of the officers of a
company applicant;
(3) the name and address of the person that owns the
premises where the applicant intends to conduct poker gaming under
the license sought;
(4) the address of the premises where the applicant
intends to conduct poker gaming under the license sought;
(5) the name and address of the lessor of the building
in which the premises are located, if the applicant leases or will
lease the premises at which the applicant intends to conduct poker
gaming;
(6) for a pari-mutuel license holder applicant, the
number of poker tables requested for the holder's horse or
greyhound racetrack; and
(7) a financial statement certified by a certified
public accountant demonstrating that the applicant holds gross
capital assets, including land and buildings, of at least $1
million.
(c) An applicant, other than an applicant described by
Section 2004.103(a)(1)(B), must attach to the application a copy
of:
(1) each license or permit the applicant holds issued
by the Texas Alcoholic Beverage Commission authorizing the
applicant to sell or serve distilled spirits for on-premises
consumption; or
(2) the person's pari-mutuel license.
Sec. 2004.103. COMMERCIAL OPERATOR'S LICENSE: MANDATORY
ISSUANCE; CONTINUED SUITABILITY. (a) The commission shall issue a
commercial operator's license to an applicant that:
(1) meets one of the following requirements:
(A) holds:
(i) an alcoholic beverage license or permit
issued by the Texas Alcoholic Beverage Commission authorizing the
applicant to sell or serve distilled spirits for on-premises
consumption; or
(ii) a pari-mutuel license issued by the
Texas Racing Commission authorizing the applicant to conduct
wagering on a greyhound race or a horse race; or
(B) is a federally recognized Indian tribe that
has a reservation in this state;
(2) files the application in accordance with this
chapter;
(3) signs the application;
(4) pays the required application fee; and
(5) meets any additional requirements prescribed by
the commission.
(b) A person may not apply for a license under Subsection
(a)(1)(A)(i) unless for at least one of the three months preceding
the date of the application the person paid mixed beverage taxes
under Subchapter B, Chapter 183, Tax Code, on the gross receipts for
the premises where the person intends to conduct poker gaming in an
amount of at least:
(1) $7,500 for premises located in a municipality with
a population of at least 100,000; or
(2) $2,500 for premises to which Subdivision (1) does
not apply.
(c) Subsection (b) does not prohibit a person from applying
for and receiving a commercial operator's license if the person is
otherwise eligible for the license under Subsection (a)(1)(A)(ii)
or (a)(1)(B).
(d) If video surveillance is required under Section
2004.468, the commission may not issue a commercial operator's
license to an applicant unless the applicant provides the video
surveillance equipment required by that section.
(e) The commission may adopt rules providing for a person's
continued suitability to hold a commercial operator's license.
(f) The opportunity to hold a commercial operator's license
is a revocable privilege and not a right or property under the
United States Constitution or the Texas Constitution. An applicant
for or holder of a commercial operator's license does not have a
vested interest or right in a license granted under this chapter.
Sec. 2004.104. CHARITABLE OPERATOR'S LICENSE APPLICATION.
(a) In accordance with commission rules, an applicant for a
charitable operator's license shall file with the commission an
application that contains the information identified in Subsection
(b) and any additional information the commission requires to
determine the suitability and eligibility of the applicant to
conduct poker gaming in this state.
(b) The application must include:
(1) the name and address of the applicant;
(2) the names and addresses of the officers of an
applicant;
(3) the name and address of the person that owns the
premises where the applicant intends to conduct charitable poker
gaming under the license sought;
(4) the address of the premises where the applicant
intends to conduct charitable poker gaming under the license
sought; and
(5) the name and address of the lessor of the building
in which the premises are located, if the applicant leases or will
lease the premises at which the applicant intends to conduct
charitable poker gaming.
Sec. 2004.105. SUITABILITY TO HOLD CHARITABLE OPERATOR'S
LICENSE; REVOCABLE PRIVILEGE. (a) The commission shall determine
the suitability of an applicant for or holder of a charitable
operator's license based on suitability criteria prescribed by the
commission. The commission shall adopt the rules and standards
necessary to ensure that an applicant for a charitable operator's
license or a charitable operator uses the revenue from a charitable
poker tournament for bona fide charitable purposes.
(b) The burden of proving suitability to receive or hold a
charitable operator's license is on the applicant or license
holder.
(c) The commission shall issue a charitable operator's
license to an eligible applicant if the commission determines that
the applicant is suitable under the commission's criteria.
(d) The commission may adopt rules providing for a person's
continued suitability to hold a charitable operator's license and
providing for the imposition of sanctions and penalties against a
person who does not comply with this chapter or rules adopted under
this chapter.
(e) The opportunity to hold a charitable operator's license
is a revocable privilege and not a right or property under the
United States Constitution or the Texas Constitution. An applicant
for or holder of a charitable operator's license does not have a
vested interest or right in a license granted under this chapter.
Sec. 2004.106. NONTRANSFERABILITY. A commercial
operator's license applies only to the specific premises location
identified in the license and is not transferable to another person
or location.
Sec. 2004.107. REGISTRATION OF INTEREST IN OPERATOR. (a)
Except as provided by Subsection (b), a person who directly or
indirectly owns an equity interest or creditor interest in an
applicant for or holder of a commercial operator's license shall:
(1) register and qualify with the commission under
commission rules; and
(2) provide information the commission finds
necessary to determine the suitability and eligibility of the
person to retain the interest.
(b) The following persons are not required to register or
qualify under this section:
(1) an employee of a licensed operator who is required
to apply for an employee's license under Subchapter E;
(2) an institutional investor; or
(3) any other group or class of persons that the
commission by rule exempts from registration or qualification.
(c) The commission shall adopt rules to implement this
section, including rules establishing procedures for registration
application, qualification, and renewal. A registration filed
under this section must be accompanied by the required application
fee.
Sec. 2004.108. COMMERCIAL OPERATOR LICENSE CONTINGENT ON
ALCOHOLIC BEVERAGE LICENSE OR PERMIT OR PARI-MUTUEL LICENSE. (a) A
commercial operator, other than an operator described by Section
2004.103(a)(1)(B), must at all times hold:
(1) an active alcoholic beverage license or permit
issued by the Texas Alcoholic Beverage Commission authorizing the
operator to sell or serve distilled spirits for on-premises
consumption; or
(2) a pari-mutuel license issued by the Texas Racing
Commission authorizing the applicant to conduct wagering on a
greyhound race or a horse race.
(b) The commission shall revoke a commercial operator's
license issued under Section 2004.103(a)(1)(A) if the operator's
license or permit described by Subsection (a) is canceled or
revoked and the operator does not hold another license or permit
described by Subsection (a).
(c) A commercial operator shall immediately notify the
commission on the expiration or suspension, cancellation, or
revocation by the Texas Alcoholic Beverage Commission of any
license or permit authorizing the operator to sell or serve
distilled spirits on the premises licensed by the commission. The
Texas Alcoholic Beverage Commission shall notify the commission
when it suspends, cancels, or revokes a license or permit
authorizing a commercial operator to sell or serve distilled
spirits.
(d) A commercial operator shall immediately notify the
commission on the expiration or suspension, cancellation, or
revocation by the Texas Racing Commission of any pari-mutuel
license held by the commercial operator authorizing the operator to
conduct wagering on a greyhound race or a horse race. The Texas
Racing Commission shall notify the commission when the Texas Racing
Commission suspends, cancels, or revokes a pari-mutuel license
authorizing a commercial operator to conduct wagering on a
greyhound race or a horse race.
(e) A commercial operator's license under this chapter is
suspended at any time when any alcoholic beverage license or permit
to sell or serve distilled spirits held by the operator is
suspended.
(f) The commission shall adopt rules for temporary
suspension of a commercial operator's license pending reissuance of
the license or permit to sell or serve distilled spirits on the
premises licensed by the commission.
[Sections 2004.109-2004.150 reserved for expansion]
SUBCHAPTER D. NONPROFIT ORGANIZATION LICENSE; CHARITABLE POKER
TOURNAMENT PERMIT
Sec. 2004.151. LICENSE REQUIRED. (a) A licensed operator
may not conduct a charitable poker tournament to benefit a
nonprofit organization unless the organization holds a license
issued under this subchapter.
(b) A licensed operator shall ensure that each nonprofit
organization receiving any portion of the net proceeds of a
charitable poker tournament conducted by the operator holds a
license issued by the commission under this subchapter.
Sec. 2004.152. LICENSE APPLICATION AND ISSUANCE. (a) An
applicant for a nonprofit organization license must:
(1) submit an application to the commission on the
form prescribed by the commission and in accordance with commission
rules;
(2) present sufficient facts relating to the
applicant's incorporation and organization to enable the
commission to determine whether the applicant may be licensed under
this subchapter; and
(3) submit the required application fee.
(b) An applicant for a nonprofit organization license
shall:
(1) sign the application; and
(2) attest under penalties of perjury that the
information contained in the application is true, correct, and
complete.
(c) The following are adequate evidence of an applicant's
tax-exempt status:
(1) a copy of an Internal Revenue Service letter that
approves the applicant's exemption from taxation under Section
501(c)(3), Internal Revenue Code of 1986; or
(2) a letter of good standing from a parent
organization of the applicant that holds an exemption from taxation
under Section 501(c)(3), Internal Revenue Code of 1986, for both
the parent organization and the applicant as its affiliate.
(d) Not later than the 30th day after the date the
commission grants an application for a nonprofit organization
license, the commission shall issue the license to the applicant.
Sec. 2004.153. SUITABILITY OF NONPROFIT ORGANIZATION
LICENSE APPLICANT OR HOLDER; REVOCABLE PRIVILEGE. (a) The
commission shall determine the suitability of an applicant for or
holder of a nonprofit organization license based on suitability
criteria prescribed by the commission to ensure that the applicant
is a bona fide nonprofit organization and that revenue from a
charitable poker tournament will be used for bona fide charitable
purposes.
(b) The burden of proving suitability to receive or hold a
license is on the applicant or license holder.
(c) The commission shall issue a nonprofit organization
license to an eligible applicant if the commission determines that
the applicant is suitable under the commission's criteria.
(d) The commission may adopt rules providing for a nonprofit
organization's continued suitability to hold a license under this
chapter and providing for the imposition of sanctions and penalties
against an organization that does not comply with this chapter or
rules adopted under this chapter.
(e) The opportunity to hold a nonprofit organization
license is a revocable privilege and not a right or property under
the United States Constitution or the Texas Constitution. An
applicant for or holder of a nonprofit organization license does
not have a vested interest or right in a license granted under this
chapter.
Sec. 2004.154. PERMIT FOR CHARITABLE POKER TOURNAMENT. (a)
A licensed operator may conduct a charitable poker tournament only
for which the operator holds a permit issued under this section.
(b) A licensed operator may apply for a permit to conduct a
charitable poker tournament by filing an application with the
commission on a form prescribed by the commission accompanied by
the required fee not later than the 30th day before the date of the
charitable poker tournament.
(c) The application for a charitable poker tournament
permit must:
(1) be submitted in accordance with commission rules;
(2) include the address and dimensions of the facility
where the tournament will occur;
(3) include the date and hours of the tournament;
(4) include the name of each licensed nonprofit
organization the tournament will benefit; and
(5) include the number of poker tables requested for
the tournament.
(d) An applicant for a charitable poker tournament permit
shall:
(1) sign the application; and
(2) attest under penalties of perjury that the
information contained in the application is true, correct, and
complete.
(e) Not later than the 10th day after the date the
commission grants an application for a permit, the commission shall
deliver the permit to the licensed operator. The permit must state
the location, date, hours, and number of tables authorized for the
charitable poker tournament. The operator must prominently display
the permit at the charitable poker tournament.
(f) The permit is valid only for the hours, date, and
location specified by the permit.
(g) A licensed operator may only operate the number of poker
gaming tables specified in the permit at the charitable poker
tournament.
Sec. 2004.155. CHARITABLE POKER TOURNAMENT; NET PROCEEDS.
(a) A licensed operator may conduct a charitable poker tournament
for the benefit of a licensed nonprofit organization.
(b) A licensed operator shall pay to a licensed nonprofit
organization all net proceeds from a charitable poker tournament
not later than the 30th day after the date of the tournament. The
expenses of conducting the tournament deducted by a licensed
operator may not exceed 30 percent of gross receipts. The expenses
must be reasonable or necessary to conduct the poker gaming and may
include expenses for:
(1) advertising, including the cost of printing poker
gaming gift certificates;
(2) security;
(3) repairs to equipment and the premises where the
tournament is conducted;
(4) poker gaming equipment and supplies used during
the tournament;
(5) prizes;
(6) taxes in accordance with Subchapter I;
(7) rental or mortgage and insurance expenses;
(8) bookkeeping, legal, or accounting services
related to the tournament;
(9) fees for dealers, cashiers, janitorial services,
and utility supplies and services;
(10) the permit fee; and
(11) debit card transaction fees.
(c) A licensed nonprofit organization must use the proceeds
from the charitable poker tournament for its charitable purposes.
Sec. 2004.156. DENIAL, SUSPENSION, LIMITATION, OR
REVOCATION OF NONPROFIT ORGANIZATION LICENSE. (a) The commission
may deny an application for or suspend, limit, or revoke a nonprofit
organization's license for any reasonable cause.
(b) If the commission determines that it has reasonable
grounds to believe that a licensed nonprofit organization might be
unsuitable to continue to hold the license, for protection of the
public health, safety, morals, and general welfare of the people of
this state and of the reputation of this state's poker gaming
industry, the commission shall conduct an investigation and hearing
in accordance with Subchapter K and, based on the commission's
determination, may deny, suspend, limit, or revoke the license.
(c) A nonprofit organization that has had a license
suspended or revoked may not receive, directly or indirectly, any
proceeds, compensation, consideration, or payment of any kind
relating to the conduct of a charitable poker tournament, other
than a tournament that took place before the suspension or
revocation.
[Sections 2004.157-2004.200 reserved for expansion]
SUBCHAPTER E. EMPLOYEE'S LICENSES
Sec. 2004.201. DEALER'S LICENSE REQUIRED. (a) A person may
not act as a dealer unless the person holds a dealer's license.
(b) A licensed operator shall ensure that each dealer
employed by the operator holds a dealer's license issued by the
commission.
Sec. 2004.202. DEALER'S LICENSE APPLICATION; ISSUANCE AND
DISPLAY OF BADGE. (a) A dealer's license application must:
(1) be submitted in accordance with commission rules;
(2) contain the information the commission requires to
determine the applicant's suitability and eligibility to act as a
dealer; and
(3) be accompanied by the required application fee.
(b) An applicant for a dealer's license shall:
(1) sign the application; and
(2) attest under penalties of perjury that the
information contained in the application is true, correct, and
complete.
(c) The commission shall conduct a criminal background
check on each applicant for a dealer's license.
(d) Not later than the 60th day after the date the
commission grants an application for a dealer's license, the
commission shall issue a dealer's badge to the applicant.
(e) A licensed dealer must prominently display on the
dealer's person the badge issued by the commission at all times when
the dealer is on the premises of a licensed operator as an employee
of the licensed operator.
Sec. 2004.203. RESIDENCY. A person is eligible to apply for
and hold a dealer's license without regard to the applicant's
residency in this state.
Sec. 2004.204. DETERMINATION OF SUITABILITY OF DEALER'S
LICENSE APPLICANT OR HOLDER. (a) The commission shall determine
the suitability of an applicant for or holder of a dealer's license
based on suitability criteria prescribed by the commission to
ensure that the applicant or dealer:
(1) has not been convicted of a felony;
(2) has not had a complaint alleging physical
intimidation filed against the applicant or dealer with a law
enforcement authority;
(3) has sufficient business probity, competence, and
training or experience in the poker gaming industry to act as a
dealer; and
(4) is otherwise qualified to be licensed.
(b) The burden of proving suitability to receive or hold a
dealer's license is on the applicant or license holder.
Sec. 2004.205. DENIAL, SUSPENSION, LIMITATION, OR
REVOCATION OF DEALER'S LICENSE. (a) The commission may deny an
application for or suspend, limit, or revoke a dealer's license for
any reasonable cause.
(b) If the commission determines it has reasonable grounds
to believe that a licensed dealer might be unsuitable to continue to
hold the license, for protection of the public health, safety,
morals, and general welfare of the people of this state and of the
reputation of this state's poker gaming industry, the commission
shall conduct an investigation and hearing as provided by
Subchapter K and, based on the commission's determination, may
deny, suspend, limit, or revoke a dealer's license.
(c) On the suspension or revocation of a dealer's license,
the license holder may not provide services in any capacity
requiring a license under Section 2004.201.
(d) A holder of a dealer's license that has been suspended
or revoked may not:
(1) receive, directly or indirectly, any
compensation, consideration, or payment of any kind relating to the
conduct of gaming in any capacity requiring a license under Section
2004.201, other than payment for services rendered before the
suspension or revocation; or
(2) serve or function in a capacity that would require
a license under Section 2004.201.
(e) The receipt and holding of a dealer's license is a
privilege and is not a right or property under the United States
Constitution or the Texas Constitution. An applicant for or holder
of a dealer's license does not have a vested interest or right in a
license granted under this chapter.
Sec. 2004.206. TRAINING PROGRAM FOR LICENSED DEALERS. (a)
A licensed dealer shall complete a training program in accordance
with commission rule.
(b) A training program approved by the commission must
include training related to:
(1) the conduct of poker gaming;
(2) the administration and operation of poker gaming;
(3) the promotion of poker gaming; and
(4) gaming awareness, including:
(A) problem or compulsive gambling;
(B) cheating techniques;
(C) underage gaming; and
(D) criminal awareness.
(c) The commission by rule shall establish:
(1) the content and time frame of the training
program;
(2) information related to training that must be
reported to the commission; and
(3) other training program requirements the
commission determines are necessary to promote the fair conduct of
poker gaming and compliance with this chapter.
Sec. 2004.207. OTHER EMPLOYEE'S LICENSES. (a) The
commission by rule may establish other employee's licenses the
commission determines are necessary to protect the public health,
safety, morals, and general welfare of the people of this state,
including licenses for principal managers, cage managers, owners,
and card room service personnel.
(b) A person may not engage in any conduct for which the
commission requires a person to hold a license under this section
unless the person holds the applicable license.
(c) The commission by rule shall prescribe procedures and
fees for licenses issued under this section as the commission
determines appropriate.
[Sections 2004.208-2004.250 reserved for expansion]
SUBCHAPTER F. MANUFACTURER'S AND DISTRIBUTOR'S LICENSES
Sec. 2004.251. MANUFACTURER'S LICENSE. (a) A person may
not engage in any activity related to the poker gaming equipment
manufacturing industry in this state for which a manufacturer's
license is required unless the person holds a manufacturer's
license for that activity.
(b) The commission shall adopt rules identifying activities
related to the design, manufacture, assembly, production, sale,
lease, marketing, distribution, or repair of poker gaming equipment
in this state for use in poker gaming authorized under this chapter
that the commission determines appropriate for licensing under this
section.
(c) A manufacturer's license is personal to the license
holder and allows the holder to conduct business related to the
licensed activity with any person licensed to operate poker gaming
in this state.
Sec. 2004.252. DISTRIBUTOR'S LICENSE. (a) A person may not
distribute or offer to distribute poker gaming equipment for use in
poker gaming authorized under this chapter in this state unless the
person holds a distributor's license under this subchapter.
(b) A person must obtain a distributor's license to
distribute poker gaming equipment in this state to a licensed
operator for use on premises at which poker gaming is conducted for
profit.
(c) A distributor's license is personal to the license
holder and allows the holder to conduct business with any person
licensed to operate poker gaming in this state. The license is not
transferable.
Sec. 2004.253. LICENSE APPLICATION. (a) In accordance
with commission rules, an applicant for a manufacturer's license or
distributor's license shall file with the commission an application
that contains information the commission requires to determine the
suitability and eligibility of the applicant.
(b) The application must be signed by an applicant that is
an individual or by the presiding officer and the secretary of an
applicant that is a company. Each signatory shall attest under
penalties of perjury that the information contained in the
application is true, correct, and complete.
(c) An application for a manufacturer's license or
distributor's license must be accompanied by the required
application fee.
Sec. 2004.254. SUITABILITY DETERMINATION; DENIAL,
SUSPENSION, LIMITATION, OR REVOCATION OF LICENSE. (a) In
considering the suitability of a company applying for or holding a
manufacturer's license or distributor's license, the commission
shall consider the suitability of each principal manager and each
holder of an equity interest or creditor interest in the company
applicant to individually receive and hold a manufacturer's license
or distributor's license based on the suitability standards that
apply to the company applicant. A person may not hold a
manufacturer's license or distributor's license if that person
would be found unsuitable to hold an operator's license.
(b) If the commission determines that it has reasonable
grounds to believe an applicant or license holder is unsuitable to
hold a manufacturer's license or distributor's license, the
commission shall conduct an investigation and hearing under
Subchapter K and, based on the commission's determination, may
deny, suspend, limit, or revoke the license. If the applicant is an
entity other than an individual, the commission may investigate
equity owners of the applicant who have at least a 10 percent
ownership in the applicant.
(c) On suspension or revocation of a license, the license
holder may not perform any manufacturing activity or distribution
activity requiring a license under this chapter. A holder of a
manufacturer's or distributor's license that has been suspended or
revoked may not receive, directly or indirectly, compensation,
consideration, or payment of any kind relating to any manufacturing
or distribution activity in any capacity requiring a license under
this chapter, other than payment for goods provided before the
suspension or revocation.
(d) A licensed operator who has entered into a lease with a
manufacturer or distributor whose license has been suspended or
revoked may continue to make payments on the lease based on the
original terms of the lease without modification or may accelerate
the lease and pay it off, at the sole option of the operator.
(e) The burden of proving suitability to receive or hold a
manufacturer's or distributor's license is on the applicant or
license holder.
[Sections 2004.255-2004.300 reserved for expansion]
SUBCHAPTER G. TEMPORARY LICENSE; LICENSE RENEWAL
Sec. 2004.301. TEMPORARY LICENSE. (a) Before issuing a
license under this chapter, the commission may issue a temporary
license for a period not to exceed six months and may renew the
temporary license as many times as the commission determines
appropriate on the payment of the fee and execution of the bond, if
required.
(b) The commission may issue a temporary license only to a
person the commission believes will be qualified to hold the
license based on:
(1) the commission's review of the background
investigations conducted by other state agencies or other
government agencies in United States or Canadian jurisdictions with
regulated poker gaming activities; and
(2) the commission's determination that the background
investigations of the applicant failed to reveal anything that
would cause the applicant not to qualify for a license in this
state.
Sec. 2004.302. LICENSE TERM; RENEWAL. (a) A license issued
under this chapter expires on the first anniversary of the date of
issuance.
(b) A license holder may annually renew a license by
complying with the commission's licensing requirements and paying
the annual license fee.
(c) A license holder shall submit with each license renewal
fee a renewal application on a form prescribed by the commission.
[Sections 2004.303-2004.350 reserved for expansion]
SUBCHAPTER H. APPLICATION AND LICENSE FEES
Sec. 2004.351. APPLICATION FEES. (a) Except as provided by
Subsection (b), an applicant for a license required by this chapter
shall pay an application fee in the amount of:
(1) $1,000 for a commercial operator's license;
(2) $1,000 for a charitable operator's license;
(3) $100 for a nonprofit organization license;
(4) $100 for a dealer's license;
(5) $250 for a manufacturer's license; or
(6) $250 for a distributor's license.
(b) The commission may increase an application fee if the
amount prescribed by Subsection (a) does not cover the commission's
cost of evaluating the application and issuing a license.
(c) Application fees are nonrefundable and must:
(1) be in the form prescribed by the commission; and
(2) be payable to the commission.
(d) The commission shall apply an application fee toward the
cost of investigating the applicant's suitability for licensing or
qualification under this chapter. The applicant shall pay any
costs of investigation incurred in excess of the assessed
application fee.
Sec. 2004.352. LICENSE FEES. A holder of a license issued
under this chapter shall annually pay the commission a license fee
in the amount of:
(1) $1,000 for a charitable or commercial operator's
license;
(2) $100 for a dealer's license;
(3) $250 for a manufacturer's license;
(4) $250 for a distributor's license; or
(5) $100 for a nonprofit organization license.
[Sections 2004.353-2004.400 reserved for expansion]
SUBCHAPTER I. TAXES
Sec. 2004.401. GROSS RECEIPTS TAX. (a) A tax is imposed on
the gross receipts received in connection with the premises of a
commercial operator conducting poker gaming under this chapter.
(b) Except as provided by Subsections (c) and (d), the tax
rate is 18 percent of the gross receipts received for poker gaming
by a commercial operator.
(c) Except as provided by Subsection (d), the tax rate is 16
percent of the gross receipts received for poker gaming by a
commercial operator who holds a pari-mutuel license described by
Section 2004.103(a)(1)(A)(ii).
(d) The tax rate is five percent of the gross receipts
received by a licensed operator during a charitable poker
tournament.
Sec. 2004.402. PAYMENT AND REPORTING OF TAX. (a) A
licensed operator must electronically submit a report of each day's
total gross receipts to the comptroller not later than 5 p.m. on the
day following the day the gross receipts were collected.
(b) The tax is due and payable by the licensed operator to
the comptroller not later than the deadline provided by Subsection
(a) for the report required by that subsection. The depository used
by a licensed operator for deposit of gross receipts taxes due to
the comptroller must be a licensed financial institution located in
this state. The comptroller may sweep or debit the licensed
operator's bank account on a daily basis to collect the gross
receipts tax due and payable. A licensed operator may not continue
to conduct any poker gaming activity on the operator's premises if,
at the time the comptroller sweeps the account, the amount reported
under Subsection (a) is not available for collection.
(c) The report of a tax must be filed under oath on forms
prescribed by the commission.
(d) The comptroller and the commission shall adopt rules for
the payment of the tax.
(e) A licensed operator required to file a tax return with
the comptroller shall provide a copy of the tax return to the
commission in the manner prescribed by commission rule.
(f) The comptroller shall deposit the revenue collected
under this section to the credit of the poker gaming revenue fund.
Sec. 2004.4025. POKER GAMING REVENUE FUND. (a) The poker
gaming revenue fund is established as an account held outside the
treasury.
(b) Money in the poker gaming revenue fund may be used only
for the following purposes:
(1) the payment of costs incurred by this state in the
regulation of poker gaming under this chapter; and
(2) after a sufficient amount is retained in the fund
to cover the costs provided by Subdivision (1), the balance to be
transferred on or before the 15th day of each month to the Texas
Department of Housing and Community Affairs to be used only as
follows:
(A) 50 percent for grants to municipalities,
counties, and nonprofit organizations to support activities
relating to:
(i) shelter and services for the homeless
and the prevention of homelessness;
(ii) renovation of shelters for use as
homeless shelters;
(iii) assistance to the homeless in
obtaining permanent housing;
(iv) medical and psychological counseling
for the homeless; and
(v) the supervision, development, and
implementation of homeless prevention activities; and
(B) the remainder to the housing trust fund
established under Section 2306.201, Government Code.
Sec. 2004.403. FAILURE TO PAY OR REPORT TAX; PENALTIES AND
INTEREST. (a) A licensed operator that fails to deposit gross
receipts tax due and payable to the comptroller for the gross
receipts collected at the operator's premises by the deadline for
payment of the tax prescribed by Section 2004.402 may not conduct
poker gaming at those premises until the tax is paid.
(b) If a person fails to report gross receipts as required
by this subchapter or fails to pay to the comptroller taxes imposed
under this subchapter later than the second day after the date the
report or payment is due, the commission shall compute and
determine the amount of taxes required to be paid and shall assess a
penalty equal to five percent of the taxes owed. If the payment is
not received by the 30th day after the date the gross receipts tax
is due, the commission shall assess an additional penalty equal to
five percent of the gross receipts tax.
(c) A delinquent tax accrues interest at the rate provided
by Section 111.060, Tax Code, beginning on the 60th day after the
tax due date.
(d) Interest at the rate of 10 percent a year attaches to a
delinquency penalty imposed under Subsection (b), beginning on the
60th day after the date the penalty is imposed.
Sec. 2004.404. RECOMPUTATION OF TAX. (a) If the commission
is not satisfied with a tax return or the amount of tax required to
be remitted under this chapter to this state by a licensed operator,
the commission or the comptroller may compute and determine the
amount required to be paid on the basis of:
(1) the facts contained in the return or report of
receipts; or
(2) any information that the commission or comptroller
possesses, or that may come into the possession of the commission,
without regard to the period covered by the information.
(b) A licensed operator subject to a tax computed under this
section may request an investigation and hearing under Subchapter
K, at which the person may present evidence on the amount of tax
due.
(c) The commission shall conduct an audit of the person's
accounts as part of the investigation under Section 2004.501.
Sec. 2004.405. DETERMINATION IF RETURN NOT MADE. (a) If a
licensed operator fails to make a required return or if a person
conducts poker gaming without a license issued under this chapter,
the commission shall estimate the gross receipts received by the
operator or person. The estimate must cover the period:
(1) for which the operator failed to make a return; or
(2) during which the person conducted poker gaming
without a license.
(b) An estimate under this section must be based on any
information covering any period that the commission possesses or
that may come into the possession of the commission.
(c) On the basis of the commission's estimate, the
commission shall compute and determine the amount of taxes imposed
by this subchapter on those gross receipts and assess a penalty
equal to 10 percent of that tax amount.
(d) One or more determinations may be made under this
section for one or more periods.
Sec. 2004.406. JEOPARDY DETERMINATION. (a) If the
commission believes that the collection of a gross receipts tax
required to be paid or the amount of a determination under Section
2004.405 will be jeopardized by delay, the commission shall make a
determination of the amount of the tax required to be collected,
noting the finding of jeopardy on the determination. The
determined amount is due and payable immediately.
(b) If a license holder does not pay the amount specified by
a determination on or before the 20th day after the date of service
of the determination on the license holder, the amount becomes
final at the end of the 20th day unless the license holder files a
petition for redetermination on or before the 20th day after
service of notice of the determination.
(c) A delinquency penalty of 10 percent of the tax and
interest at the rate of 10 percent a year attaches to the amount of
the tax required to be collected.
Sec. 2004.407. APPLICATION OF TAX LAWS. Subtitle B, Title
2, Tax Code, applies to the administration, collection, and
enforcement of the gross receipts tax imposed under Section
2004.401 except as modified by this chapter.
Sec. 2004.408. DELINQUENCY: SEIZURE AND SALE. (a) At any
time before the third anniversary of the date a person becomes
delinquent in the payment of a gross receipts tax imposed under this
subchapter, the commission may collect the amount as provided by
this section.
(b) The commission may order the sheriff or constable for
the jurisdiction in which licensed poker gaming tables for which a
gross receipts tax is delinquent to conduct the seizure and sale
authorized by this section. The sheriff or constable may deduct
reasonable expenses from any amount realized by sale of the
property.
(c) The commission or sheriff or constable shall seize
personal or real property of the license holder that is not exempt
from execution under the laws of this state and sell the property at
public auction to pay the amount of taxes due, any interest or
penalties due on those taxes, and any expense incurred in
connection with the seizure and sale. Personal property must be
seized and sold first, and real property may be seized and sold only
if the sale of personal property does not produce an amount
sufficient to pay the total amount of taxes, interest, or penalties
due. The seizure and sale must be conducted in accordance with
applicable state law.
Sec. 2004.409. SECURITY. (a) Not later than the fifth day
after the date the licensed operator receives notice from the
commission of an order approving the application for an operator's
license, each operator, to secure payment of the gross receipts tax
imposed under this subchapter, shall furnish to the commission
security in the form and amount the commission considers
appropriate, which may be in the form of:
(1) a cash bond;
(2) a bond from a surety company chartered or
authorized to conduct business in this state;
(3) certificates of deposit;
(4) certificates of savings;
(5) United States treasury bonds; or
(6) subject to the approval of the commission, an
assignment of negotiable stocks or bonds.
(b) The commission shall set the amount of the security,
taking into consideration the amount of money that has or is
expected to become due from the licensed operator, based on the
number of poker gaming tables to be operated on the operator's
premises. The commission may adjust the amount of security
required after the licensed operator begins conducting poker gaming
on the premises and paying gross receipts taxes.
(c) If a license holder fails to pay the gross receipts tax
imposed under this subchapter, the commission may notify the
license holder and any surety of the delinquency by jeopardy or
deficiency determination. If payment is not made when due, the
commission may order the forfeit of all or part of the security to
cover the amount due.
(d) If the licensed operator ceases to conduct poker gaming
and relinquishes the operator's license, the commission shall
authorize the release of all security on a determination that no
amounts of the gross receipts tax remain due and payable under this
subchapter.
[Sections 2004.410-2004.450 reserved for expansion]
SUBCHAPTER J. REGULATION OF POKER GAMING OPERATIONS
Sec. 2004.451. REGULATION OF POKER GAMING OPERATIONS. The
commission shall adopt rules to govern the operation of poker
gaming at a licensed operator's premises as the commission
determines necessary for the protection of the public health,
safety, morals, and general welfare of the people of this state and
of the reputation of this state's poker gaming industry.
Sec. 2004.452. HOURS OF OPERATION. (a) A licensed operator
that holds a license or permit issued by the Texas Alcoholic
Beverage Commission to sell or serve distilled spirits for
on-premises consumption may conduct poker gaming on the premises
covered by the operator's license only during the hours in which the
license holder may sell or serve distilled spirits under the
alcoholic beverage license or permit.
(b) A licensed operator that does not hold a license or
permit issued by the Texas Alcoholic Beverage Commission to sell or
serve distilled spirits for on-premises consumption may conduct
poker gaming on the premises covered by the operator's license at
any time.
(c) The hours of operation for poker gaming must be clearly
posted in the licensed operator's poker gaming area.
(d) The commission shall determine the hours of operation
for a charitable poker tournament and specify the hours in the
permit.
Sec. 2004.453. TABLE LIMITS; TOURNAMENTS. (a) A licensed
operator shall establish table limits for each poker gaming table.
(b) The licensed operator may conduct tournaments at any
time and charge a buy-in fee not to exceed $100 and a tournament
registration fee not to exceed $30.
Sec. 2004.454. BANK. A licensed operator shall establish
on the operator's premises a bank to convert legal United States
tender into chips or tokens and to convert chips or tokens into
cash.
Sec. 2004.455. USE OF CHIPS OR TOKENS. (a) All poker
gaming conducted by a licensed operator shall be conducted using
chips or tokens approved by the commission.
(b) All chips or tokens must bear the logo of the licensed
operator's premises and must be manufactured in a manner designed
to substantially decrease the chips' or tokens' susceptibility to
counterfeiting. The commission may inspect a licensed operator's
chips or tokens to confirm compliance with this section.
Sec. 2004.456. USE OF PLAYING CARDS. (a) Poker gaming
conducted by a licensed operator shall be played with one or more
poker industry standard poker card decks.
(b) Each poker card deck used in poker gaming must be sealed
with a label indicating the deck was manufactured or distributed by
a licensed manufacturer or distributor.
(c) Not more than 50 separate poker hands may be played with
the same poker card deck.
(d) Each poker card deck must be monitored and cataloged in
a log that documents the exact location of the cards on a licensed
operator's premises.
Sec. 2004.457. RULES OF PLAY. All poker rules used in poker
gaming conducted by a licensed operator shall be submitted to and
approved by the commission.
Sec. 2004.458. BOND REQUIREMENT. (a) Each employee of a
licensed operator who handles cash, other than an employee employed
to sell or serve distilled spirits, must be bonded.
(b) For each employee required to comply with Subsection
(a), a licensed operator shall:
(1) submit to the commission a copy of the certificate
evidencing that the employee has obtained a fidelity bond from a
surety company chartered or authorized to conduct business in this
state; and
(2) post a copy of the certificate in a conspicuous
location on the operator's premises.
Sec. 2004.459. BADGES. (a) During the operation of poker
gaming, each individual licensed under this chapter shall wear in a
prominently visible location on the individual's person a numbered
badge issued by the commission.
(b) An individual who ceases employment with a licensed
operator shall immediately surrender the individual's badge to the
operator. Not later than the 10th day after the date the individual
surrenders the badge, the licensed operator shall:
(1) on a form adopted by the commission notify the
commission in writing of a change in status of the individual; and
(2) submit the surrendered badge to the commission.
(c) Each badge issued to an individual must prominently
display on the front of the badge:
(1) capital letters identifying the license held by
the individual;
(2) the first name of the individual;
(3) the picture of the individual submitted with the
individual's license application;
(4) the badge number; and
(5) the expiration date of the license.
(d) The full name of the license holder, along with the type
of license, must be printed on the reverse side of the badge.
Sec. 2004.460. BONUS PROGRAMS. (a) The commission by rule
shall establish promotion bonus programs for bad beat hands and
other bonus programs. The programs may be statewide or limited to
individual premises.
(b) Each licensed operator shall:
(1) collect promotion bonus fees in accordance with
commission rule; and
(2) award a bonus that does not exceed $250 to the
player who wins the bonus.
(c) The amount awarded under Subsection (b)(2) shall be
deducted from the daily promotion bonus fee that would otherwise be
remitted to this state.
(d) The commission shall award to the winning player of a
bonus program any amount that exceeds $250.
(e) A distributor may collect from the commission an
administrative fee, not to exceed 20 percent of the promotion bonus
fee paid to a winning player.
(f) A promotion bonus program for bad beat hands or any
other bonus program may not be offered for a charitable poker
tournament.
Sec. 2004.461. COLLECTION FEE. (a) Each licensed operator
shall collect a collection fee on each poker hand played. The
collection fee may not exceed 10 percent of the communal pot in each
hand of poker played, with a maximum of $4 per hand.
(b) The commission shall adopt rules necessary to
administer this section.
Sec. 2004.462. PROMOTION BONUS FEE. (a) A promotion bonus
fee may not exceed $1 per hand.
(b) The promotion bonus fee shall be remitted to this state,
after deducting the gross receipts tax, the fee used for bonus
programs, and administrative fees not to exceed 20 percent of the
promotion bonus fee.
Sec. 2004.463. CONTRIBUTION TO PURSE FUND. (a) A
pari-mutuel license holder described by Section
2004.103(a)(1)(A)(ii) that conducts poker gaming in this state
shall deposit in a purse fund two percent of the license holder's
gross receipts from that poker gaming.
(b) Money in the purse fund may only be expended in
accordance with rules adopted by the Texas Racing Commission under
Section 18.09, Texas Racing Act (Article 179e, Vernon's Texas Civil
Statutes).
Sec. 2004.464. REPORTING REQUIREMENTS. (a) A licensed
operator shall keep books and records in a manner that clearly shows
the total amount of gross receipts and total deposits made by all
poker gaming players.
(b) The books and records kept by a licensed operator
relating to poker gaming operations are not public information, and
publication and dissemination of the materials by the commission
are prohibited. The commission may publish and disseminate the
total gross receipts of each licensed operator at the frequency and
in the level of detail the commission considers appropriate.
(c) A licensed operator that is not an individual shall file
a report of each change of the operator's officers and directors
with the commission. The commission shall, not later than the 90th
day after the date of the change, approve or disapprove the change.
During the 90-day period, the officer or director is entitled to
exercise the powers of the position to which the officer or director
was elected or appointed.
(d) The commission may require that a licensed operator
provide the commission with a copy of the operator's federal income
tax return not later than the 30th day after the date the return is
filed with the federal government. The federal income tax returns
submitted to the commission are not public information, and
publication and dissemination of the materials by the commission
are prohibited.
Sec. 2004.465. EXCLUSION OF PERSONS. (a) The commission by
rule shall provide for the maintenance of a list of persons who are
to be excluded or ejected from poker gaming premises. The list may
include a person whose presence in poker gaming premises is
determined by the commission to pose a threat to the interests of
this state, to licensed poker gaming, or to both.
(b) In making a determination under this section, the
commission may consider any:
(1) prior conviction of a crime that is a felony in
this state or under the laws of the United States or a crime
involving moral turpitude or a violation of the gaming laws of a
state or the United States; or
(2) violation of or conspiracy to violate the
provisions of this chapter relating to:
(A) the failure to disclose an interest in a
licensed operator;
(B) wilful evasion of a fee or a tax; or
(C) a notorious or unsavory reputation that would
adversely affect public confidence and trust that the poker gaming
industry is free from criminal or corruptive elements.
Sec. 2004.466. INTERNAL AUDIT AND CONTROL SYSTEMS. (a) A
licensed operator shall adopt an internal control system that:
(1) safeguards its assets and revenues, which must
include means for recording cash transactions and balances and
evidences of indebtedness; and
(2) provides for reliable records, accounts, and
reports of transactions, operations, and events, including reports
to the director and the commission.
(b) The internal control system must be designed to
reasonably ensure that:
(1) assets are safeguarded;
(2) financial records are accurate and reliable;
(3) transactions are performed only in accordance with
management's general or specific authorization;
(4) transactions are recorded adequately to allow
proper reporting of poker gaming revenue and of fees and taxes and
to maintain accountability for assets;
(5) access to assets is permitted only in accordance
with the licensed operator's specific authorization;
(6) recorded accountability for assets is compared
with actual assets at reasonable intervals and appropriate action
is taken with respect to any discrepancies; and
(7) functions, duties, and responsibilities are
appropriately segregated and performed in accordance with sound
practices by competent, qualified personnel.
(c) A licensed operator or an applicant for an operator's
license shall describe, in a manner approved or required by the
director, the licensed operator's or applicant's administrative and
accounting procedures in detail in a written system of internal
control. A licensed operator or applicant for an operator's
license shall submit a copy of the written system. A written system
must include:
(1) an organizational chart depicting appropriate
segregation of duties and responsibilities;
(2) a description of the duties and responsibilities
of each position shown on the organizational chart;
(3) a detailed narrative description of the
administrative and accounting procedures designed to satisfy the
requirements of Section 2004.402(a);
(4) a written statement signed by the licensed
operator or applicant's chief financial officer or by the licensed
operator or applicant, if an individual, attesting that the system
satisfies the requirements of this section;
(5) if the written system is submitted by an
applicant, a letter from an independent certified public accountant
stating that the applicant's written system has been reviewed by
the certified public accountant and complies with the requirements
of this section; and
(6) other items the director may require.
(d) The commission shall adopt minimum standards for
internal control procedures.
Sec. 2004.467. AGE REQUIREMENTS. A person younger than 21
years of age may not:
(1) play, be allowed to play, place wagers, or collect
a communal pot, personally or through an agent, or be present during
poker gaming at any premises authorized under this chapter; or
(2) be employed as a poker gaming employee.
Sec. 2004.468. VIDEO SURVEILLANCE AND DISPUTE RESOLUTION.
(a) Except as provided by commission rule for a charitable poker
tournament, each licensed operator shall provide video
surveillance of the poker gaming conducted at each poker gaming
table as follows:
(1) at least two video surveillance cameras must be
dedicated to each poker gaming table;
(2) the video cameras must have a clear, unobstructed
view of the communal cards, chips, and dealers' hands; and
(3) the video records must be maintained for at least
30 days unless a notice is received from the commission under
Subsection (c), in which case the video surveillance tape recording
must be maintained until the commission notifies the operator that
the dispute has been resolved.
(b) If a player at a poker gaming table disputes the
decision of the dealer regarding the final disposition of an
individual game, the player may file a complaint with the licensed
operator. The licensed operator shall attempt to resolve a gaming
dispute immediately on receiving a complaint.
(c) Players in a poker game must make a formal complaint of
the dispute to the commission by the end of the next business day
following the date the poker game was played. The commission shall
notify the licensed operator immediately of the complaint, and the
operator shall send to the commission a copy of any video recording
related to the complaint.
(d) The commission shall adopt rules and develop forms for
use by players for resolution of complaints submitted by players
under this section.
(e) The commission shall establish rules for surveillance
at charitable poker tournaments.
Sec. 2004.469. QUESTIONING AND DETENTION OF PERSONS. A
licensed operator or an employee of the operator may question any
person on the poker gaming premises who is suspected of violating
this chapter. The licensed operator or the operator's employee is
not criminally or civilly liable:
(1) as a result of the questioning; or
(2) for reporting the person suspected of the
violation to the director or law enforcement authorities.
Sec. 2004.470. SERVICE OF COMPLIMENTARY ALCOHOLIC
BEVERAGES PROHIBITED. A licensed operator may not serve
complimentary alcoholic beverages to a player on the operator's
poker gaming premises.
[Sections 2004.471-2004.500 reserved for expansion]
SUBCHAPTER K. ENFORCEMENT
Sec. 2004.501. INVESTIGATION. The commission may conduct
an appropriate investigation to:
(1) determine whether this chapter or a commission
rule was violated;
(2) determine facts, conditions, practices, or
matters the commission considers necessary or proper to aid in the
enforcement of a law or rule;
(3) aid in adopting rules;
(4) secure information as a basis for recommending
legislation relating to this chapter; and
(5) determine whether a license holder is able to meet
the license holder's financial obligations, including all
financial obligations imposed by this chapter, as they become due.
Sec. 2004.502. AUDIT. (a) The commission may conduct an
audit of a license holder's books and records as part of an
investigation.
(b) If a recomputation of tax under Section 2004.404 is at
issue, the commission shall conduct an audit.
Sec. 2004.503. COMPLAINT. (a) If after an investigation
the commission is satisfied that a license, certificate of
registration, finding of suitability, or prior approval by the
commission of a transaction for which approval was required or
authorized under this chapter should be limited, conditioned,
suspended, or revoked, or that a fine should be imposed, the
executive director shall:
(1) initiate a hearing by filing a complaint with the
commission; and
(2) transmit a summary of evidence that bears on the
matter and the transcript of testimony at an investigative hearing
conducted by or on behalf of the executive director regarding the
matter.
(b) The complaint must:
(1) be a written statement of charges that sets forth
in ordinary and concise language the acts or omissions with which
the respondent is charged;
(2) specify the statute or rule that the respondent is
alleged to have violated;
(3) contain a factual allegation; and
(4) not consist merely of charges raised on the
language of the statute or rule.
(c) On the filing of the complaint, the executive director
shall serve a copy of the complaint on the respondent either
personally or by registered or certified mail at the respondent's
address on file with the executive director.
(d) The respondent must file an answer with the executive
director not later than the 30th day after the date the complaint is
served.
Sec. 2004.504. HEARING. (a) On receipt of a complaint
under this subchapter, the commission shall review all matter
presented in support of the complaint and shall appoint a hearing
examiner to conduct further proceedings.
(b) The hearing examiner shall conduct proceedings under
Chapter 2001, Government Code. After the proceedings, the hearing
examiner may recommend that the commission take any appropriate
action, including revocation, suspension, limitation, or
conditioning of a license, certificate of registration, finding of
suitability, or prior approval or imposition of a fine not to exceed
$5,000 for each violation.
(c) The commission shall review the recommendation. The
commission may remand the case to the hearing examiner for
presentation of additional evidence on a showing of good cause as to
why the evidence could not have been presented at the previous
hearing.
(d) The commission shall accept, reject, or modify the
recommendation.
(e) If the commission limits, conditions, suspends, or
revokes a license, finding of suitability, or prior approval or
imposes a fine, the commission shall issue a written order.
(f) A limitation, condition, revocation, suspension, or
fine imposed is effective according to its terms until reversed
following judicial review, except that the commission may stay its
order pending a rehearing or judicial review on terms and
conditions the commission considers proper.
Sec. 2004.505. JUDICIAL REVIEW. Judicial review of an
order or decision of the commission may be made under Chapter 2001,
Government Code. Judicial review is under the substantial evidence
rule.
Sec. 2004.506. PRIVILEGED DOCUMENTS. (a) A communication
or document of an applicant or license holder that is required by
law or commission rule or by a subpoena issued by the commission and
that is to be made or transmitted to the commission is privileged
and does not impose liability for defamation or constitute a ground
for recovery in a civil action.
(b) If a document or communication contains information
that is privileged, the privilege is not waived or lost because the
document or communication is disclosed to the commission.
(c) Notwithstanding the powers granted to the commission by
this chapter, the commission:
(1) may not release or disclose privileged
information, documents, or communications provided by an applicant
or license holder and required by a court order after timely notice
of the proceedings has been given to the applicant or license holder
without the prior written consent of the applicant or license
holder;
(2) shall maintain all privileged information,
documents, and communications in a secure place accessible only to
commission members and the executive director; and
(3) shall adopt procedures to protect the privileged
nature of information, documents, and communications provided by an
applicant or license holder.
Sec. 2004.507. RELEASE OF CONFIDENTIAL INFORMATION. (a)
An application to a court for an order requiring the commission to
release any confidential information shall be made only on a
written motion delivered not later than the 10th day before the date
of application to the commission, the attorney general, and all
persons who may be affected by the entry of the order.
(b) Copies of the motion and all papers filed in support of
the motion shall be served with the notice by delivering a copy in
person or by certified mail to the last known address of the person
to be served.
Sec. 2004.508. EMERGENCY ORDERS. (a) The commission may
issue an emergency order to:
(1) suspend, limit, or condition a license or finding
of suitability; or
(2) require a licensed operator to keep an individual
license holder from the premises or to not pay the holder any
remuneration for services or any profits, income, or accruals on
the licensed operator's investment in the premises.
(b) An emergency order may be issued only if the commission
determines that:
(1) a license holder or person found suitable has
wilfully failed to report, pay, or truthfully account for a fee,
tax, or other amount imposed under this chapter or wilfully
attempted in any manner to evade or defeat a fee, tax, or other
payment;
(2) a license holder cheated at a poker game; or
(3) the action is necessary for the immediate
preservation of the public peace, health, safety, morals, good
order, or general welfare.
(c) The emergency order must state the grounds on which it
is issued, including a statement of facts constituting the alleged
emergency necessitating the action.
(d) An emergency order may be issued only with the approval
of and under the signature of a majority of the commission members.
(e) An emergency order is effective immediately on issuance
and service on the license holder or resident agent of the license
holder, an employee, or, in cases involving registration or
findings of suitability, the person or entity involved or resident
agent of the entity involved. An emergency order may suspend,
limit, condition, or take other action in relation to the license,
certificate of registration, or suitability finding of one or more
persons in an operation without affecting other individual license
holders or persons subject to a suitability finding. An emergency
order remains effective until further order of the commission or
final disposition of the case.
(f) Not later than the fifth day after the date of issuance
of an emergency order, the executive director shall file a
complaint and serve it on the person involved. The person against
whom the emergency order has been issued and served is entitled to a
hearing before the commission and to judicial review of the
decision and order of the commission under Chapter 2001, Government
Code. Judicial review is under the substantial evidence rule.
Sec. 2004.509. ACCESS TO CRIMINAL HISTORY RECORD
INFORMATION. (a) The commission, the executive director, and the
director are entitled to conduct an investigation of and obtain
criminal history record information maintained by the Department of
Public Safety, the Federal Bureau of Investigation identification
division, or another law enforcement agency to assist in the
investigation of:
(1) a licensed operator or an applicant for an
operator's license;
(2) a person required to be named in a license
application;
(3) an employee of a licensed operator, if the
employee is or will be directly involved in poker gaming
operations;
(4) a person who manufactures or distributes poker
gaming equipment, or a representative of a person who manufactures
or distributes poker gaming equipment or supplies offered to a
poker card room;
(5) a dealer or other employee license holder or
applicant;
(6) a registered owner of an equity or creditor
interest in a licensed operator or an applicant for such a
registration;
(7) a licensed nonprofit organization or an applicant
for a nonprofit organization license; or
(8) if a person described in another subdivision of
this subsection is not an individual, an individual who:
(A) is an officer or director of the person;
(B) holds more than 10 percent of the stock in the
person;
(C) holds an equitable interest greater than 10
percent in the person;
(D) is a creditor of the person who holds more
than 10 percent of the person's outstanding debt;
(E) is the owner or lessee of a business that the
person conducts or through which the person will conduct poker
gaming-related activities;
(F) shares or will share in the profits, other
than stock dividends, of the person;
(G) participates in managing the affairs of the
person; or
(H) is an employee of the person who is or will be
involved in providing services to a poker card room.
(b) On each anniversary of the date of issuance of an
operator's license, the commission shall obtain criminal history
record information maintained by the Department of Public Safety on
the licensed operator and on each holder of a 10 percent or greater
equity or creditor interest in the licensed operator.
(c) Not later than the first anniversary after the date of
each license renewal, the commission shall obtain criminal history
record information maintained by the Department of Public Safety on
each licensed dealer or other employee, manufacturer, or
distributor.
Sec. 2004.510. FINGERPRINTS. The commission may deny an
application for a license or certificate of registration or the
commission may suspend or revoke a license or certificate of
registration if the applicant fails on request to provide a
complete legible set of fingerprints of a person required to be
named in a license application.
Sec. 2004.511. DEPARTMENT OF PUBLIC SAFETY ASSISTANCE;
COSTS OF INVESTIGATION. (a) The executive director or the director
may request the cooperation of the Department of Public Safety to
perform a background investigation of a person listed in Section
2004.509. The commission shall reimburse the department for the
actual cost of an investigation.
(b) The executive director may require a person who is
subject to investigation to pay all costs of the investigation and
to provide any information, including fingerprints, necessary to
carry out the investigation or facilitate access to state or
federal criminal history record information. Payments made to the
executive director under this subsection shall be deposited in the
general revenue fund and may be used only to reimburse the
commission or the Department of Public Safety for the actual costs
of an investigation.
(c) Unless otherwise prohibited by law, the Department of
Public Safety may retain any record or information submitted to it
under this section. The department shall notify the executive
director or the director of any change in information provided to
the executive director or the director when the department learns
of the change.
[Sections 2004.512-2004.550 reserved for expansion]
SUBCHAPTER L. PENALTIES AND OFFENSES
Sec. 2004.551. FAILURE TO PAY FEES. (a) License fees and
other fees required by this chapter must be paid to the commission
on or before the dates provided by law for each fee.
(b) A person failing to timely pay a fee when due shall pay
in addition a penalty of not less than $50 or 25 percent of the
amount due, whichever is greater. The penalty may not exceed $1,000
if the fee is less than 10 days late and may not exceed $5,000 under
any circumstances. The penalty shall be collected in the same
manner as other charges, license fees, and penalties under this
chapter.
Sec. 2004.552. FAILURE TO REPORT, PAY, OR ACCOUNT FOR FEE.
(a) A person commits an offense if the person wilfully fails to
report, pay, or truthfully account for a fee imposed under this
chapter or wilfully attempts in any manner to evade or defeat a fee.
(b) An offense under this section is a Class A misdemeanor.
Sec. 2004.553. FRAUD. (a) A person commits an offense if
the person knowingly:
(1) alters or misrepresents the outcome of a poker
game on which wagers have been made after the outcome is made sure
but before it is revealed to the players;
(2) places, increases, or decreases a bet or
determines the course of play after acquiring knowledge, not
available to all players, of the outcome of the game or an event
that affects the outcome of the game or that is the subject of the
bet or aids anyone in acquiring such knowledge for the purpose of
placing, increasing, or decreasing a bet or determining the course
of play contingent on that event or outcome;
(3) claims, collects, or takes, or attempts to claim,
collect, or take, money or any thing of value in or from a poker
game, with intent to defraud, without having made a wager
contingent on the poker game, or claims, collects, or takes an
amount greater than the amount won;
(4) induces another to go to a place where poker gaming
is being conducted or operated in violation of this chapter, with
the intent that the other person play or participate in that poker
gaming; or
(5) manipulates, with the intent to cheat, a component
of poker gaming equipment in a manner contrary to the designed and
normal operational purpose for the component, with knowledge that
the manipulation affects the conduct or outcome of a poker game or
with knowledge of an event that affects the outcome of the game.
(b) An offense under this section is a felony of the third
degree.
Sec. 2004.554. USE OF PROHIBITED DEVICES. (a) A person
commits an offense if the person, at a premises of a licensed
operator, uses or possesses with the intent to use a device, other
than a device customarily used in the conduct of poker gaming, to
assist in:
(1) projecting the outcome of a poker game; or
(2) analyzing the probability of the occurrence of an
event relating to the game.
(b) An offense under this section is a felony of the third
degree.
Sec. 2004.555. USE OF COUNTERFEIT OR UNAUTHORIZED CHIPS,
TOKENS, PLAYING CARDS, OR OTHER DEVICES. (a) A person commits an
offense if the person knowingly uses counterfeit chips, tokens, or
playing cards in a poker game.
(b) A person commits an offense if the person, in playing a
poker game designed to be played with chips or tokens approved by
the commission:
(1) knowingly uses a chip or token other than a chip or
token approved by the commission; or
(2) uses any device or other means to violate the
provisions of this chapter.
(c) A person, other than an authorized employee of a
licensed operator acting in furtherance of the person's employment
in an establishment, commits an offense if the person knowingly has
on the person's body or in the person's possession on or off the
premises where poker gaming is conducted a device intended to be
used to violate the provisions of this chapter.
(d) A person, other than an authorized employee of a
licensed operator acting in furtherance of the person's employment
in an establishment, commits an offense if the person knowingly has
on the person's body or in the person's possession on or off the
premises a key or device known to have been designed for the purpose
of and suitable for opening, entering, or affecting the operation
of a poker gaming table, a drop box, or a device connected to the
table or box or for removing money or other contents from the table
or box.
(e) Possession of more than one of the devices, equipment,
products, or materials described in this section permits a
rebuttable inference that the possessor intended to use them for
cheating.
(f) An offense under this section is a felony of the third
degree.
Sec. 2004.556. CHEATING. (a) A person commits an offense
if the person knowingly cheats at any poker game.
(b) An offense under this section is a state jail felony.
Sec. 2004.557. UNAUTHORIZED OPERATION OF POKER GAMING
TABLES. (a) A person commits an offense if the person operates
poker gaming tables without a license issued by the commission.
(b) A person commits an offense if the person operates more
than four poker gaming tables at the premises of a licensed
operator.
(c) An offense under this section is a state jail felony.
Sec. 2004.558. POSSESSION OF UNLAWFUL DEVICES. (a) A
person commits an offense if the person knowingly possesses any
poker gaming device that has been manufactured, sold, or
distributed in violation of this chapter.
(b) An offense under this section is a Class A misdemeanor.
Sec. 2004.559. UNLAWFUL MANUFACTURE, SALE, OR DISTRIBUTION
OF POKER GAMING EQUIPMENT. (a) A person commits an offense if the
person manufactures, sells, or distributes poker tables, cards,
chips, or a device intended for use in violating this chapter.
(b) A person commits an offense if the person marks, alters,
or otherwise modifies any cards, chips, tokens, or poker gaming
device in a manner that:
(1) affects the result of a wager by determining win or
loss; or
(2) alters the normal criteria of random selection
that affect the operation of a game or determine the outcome of a
game.
(c) A person commits an offense if the person instructs
another person in cheating or in the use of a device for cheating at
any poker game authorized to be conducted at the premises of a
licensed operator, with the knowledge or intent that the
information or use may be employed to violate this chapter.
(d) An offense under this section is a felony of the third
degree.
Sec. 2004.560. REPORTING PENALTIES. (a) A person commits
an offense if the person, in a license application, in a book or
record required to be maintained by this chapter or a rule adopted
under this chapter, or in a report required to be submitted by this
chapter or a rule adopted under this chapter:
(1) makes a statement or entry that the person knows to
be false or misleading; or
(2) knowingly fails to maintain or make an entry the
person knows is required to be maintained or made.
(b) A person commits an offense if the person knowingly
refuses to produce for inspection by the executive director a book,
record, or document required to be maintained or made by this
chapter or a rule adopted under this chapter.
(c) An offense under this section is a Class A misdemeanor.
Sec. 2004.561. GAMING BY MINORS. (a) A person commits an
offense if the person knowingly permits an individual that the
person knows is younger than 21 years of age to participate in poker
gaming at premises at which poker gaming is conducted under a
license issued under this chapter.
(b) An individual younger than 21 years of age commits an
offense if the individual participates in poker gaming at premises
at which poker gaming is conducted under a license issued under this
chapter.
(c) An offense under this section is a Class C misdemeanor.
Sec. 2004.562. GENERAL PENALTY; CONSPIRACY. (a) A person
commits an offense if the person knowingly or wilfully violates,
attempts to violate, or conspires to violate a provision of this
chapter specifying a prohibited act.
(b) Unless another penalty is specified for the offense, an
offense under this section is a Class A misdemeanor.
SECTION 2. Section 47.02(c), Penal Code, is amended to read
as follows:
(c) It is a defense to prosecution under this section that
the actor reasonably believed that the conduct:
(1) was permitted under Chapter 2001, Occupations
Code;
(2) was permitted under Chapter 2002, Occupations
Code;
(3) consisted entirely of participation in the state
lottery authorized by the State Lottery Act (Chapter 466,
Government Code);
(4) was permitted under the Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes); [or]
(5) consisted entirely of participation in a drawing
for the opportunity to participate in a hunting, fishing, or other
recreational event conducted by the Parks and Wildlife Department;
or
(6) was permitted under Chapter 2004, Occupations
Code.
SECTION 3. Section 47.06(f), Penal Code, is amended to read
as follows:
(f) It is a defense to prosecution under Subsection (a) or
(c) that the person owned, manufactured, transferred, or possessed
the gambling device, equipment, or paraphernalia for the sole
purpose of shipping it:
(1) to the premises of a licensed operator under
Chapter 2004, Occupations Code, at which poker gaming may be
conducted under the license; or
(2) to another jurisdiction where the possession or
use of the device, equipment, or paraphernalia was legal.
SECTION 4. Section 47.09(a), Penal Code, is amended to read
as follows:
(a) It is a defense to prosecution under this chapter that
the conduct:
(1) was authorized under:
(A) Chapter 2001, Occupations Code;
(B) Chapter 2002, Occupations Code; [or]
(C) the Texas Racing Act (Article 179e, Vernon's
Texas Civil Statutes); or
(D) Chapter 2004, Occupations Code;
(2) consisted entirely of participation in the state
lottery authorized by Chapter 466, Government Code; or
(3) was a necessary incident to the operation of the
state lottery and was directly or indirectly authorized by:
(A) Chapter 466, Government Code;
(B) the lottery division of the Texas Lottery
Commission;
(C) the Texas Lottery Commission; or
(D) the director of the lottery division of the
Texas Lottery Commission.
SECTION 5. Section 411.108, Government Code, is amended by
adding Subsection (a-2) and amending Subsection (b) to read as
follows:
(a-2) The Texas Lottery Commission is entitled to obtain
from the department criminal history record information maintained
by the department that relates to a person for whom the commission
may request criminal history record information under Section
2004.509, Occupations Code.
(b) Criminal history record information obtained by the
commission under Subsection (a), [or] (a-1), or (a-2) may not be
released or disclosed to any person except on court order or as
provided by Subsection (c).
SECTION 6. Section 467.035(a), Government Code, is amended
to read as follows:
(a) The commission may not employ or continue to employ a
person who owns a financial interest in:
(1) a bingo commercial lessor, bingo distributor, or
bingo manufacturer; [or]
(2) a lottery sales agency or a lottery operator; or
(3) a licensed operator or other license holder under
Chapter 2004, Occupations Code.
SECTION 7. Article 18, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 18.09
to read as follows:
Sec. 18.09. POKER GAMING PURSE PROCEEDS. (a) To protect the
public and ensure continued support for the horse and greyhound
racing industry in this state, the commission shall adopt rules to
establish procedures governing the deposit, accounting, audit,
investment, and use of money required to be deposited into a purse
fund under Section 2004.463, Occupations Code.
(b) Other than limited administrative expenses authorized
by commission rule, the money deposited into a purse fund under
Section 2004.463, Occupations Code, may be used only to promote the
horse and greyhound racing industry in this state by providing
money for competitive purses.
SECTION 8. Not later than January 1, 2012, the Texas Lottery
Commission shall adopt the rules, develop the applications and
forms, and establish the procedures necessary to implement Chapter
2004, Occupations Code, as added by this Act.
SECTION 9. This Act takes effect September 1, 2011.