82R12667 YDB-F
By: Menendez H.J.R. No. 112
A JOINT RESOLUTION
proposing a constitutional amendment creating the Texas Gaming
Commission and authorizing and regulating casino games and slot
machines by licensed operators and certain Indian tribes to provide
money for the property tax relief fund and additional financial aid
for higher education students.
BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 47(a), Article III, Texas Constitution,
is amended to read as follows:
(a) The Legislature shall pass laws prohibiting lotteries
and gift enterprises in this State other than those authorized by
Subsections (b), (d), and (e) of this section and Section 47a of
this article.
SECTION 2. Article III, Texas Constitution, is amended by
adding Section 47a to read as follows:
Sec. 47a. (a) Casino gaming is authorized in this state in
accordance with this section to provide additional money for the
property tax relief fund and additional financial aid for higher
education students.
(b) The Texas Gaming Commission is established. The
commission is composed of five members appointed by the governor
with the advice and consent of the senate. Commission members serve
staggered six-year terms, with one or two members' terms, as
applicable, expiring February 1 of each odd-numbered year. The
governor shall fill a vacancy in a position on the commission for
the remainder of the unexpired term. The governor shall designate a
commission member as presiding officer of the commission to serve
in that capacity at the pleasure of the governor.
(c) To be eligible for appointment to the commission, a
person:
(1) must be a citizen of the United States;
(2) must have resided in this state for the two years
preceding the date of the person's appointment;
(3) may not own a financial or other interest in an
entity engaged in the conduct of gaming or the provision of casino
or slot services, or in a security issued by such an entity, or be
related within the second degree by affinity or the third degree by
consanguinity as determined by general law to an individual who
owns such a financial or other interest or security;
(4) may not be an applicant for or holder of a license
or other affirmative regulatory approval under a law administered
by the commission; and
(5) may not be a member of the governing body of a
political subdivision of this state.
(d) The Texas Gaming Commission has broad authority and
shall exercise strict control and close supervision over all
activities related to casino and slot gaming authorized and
conducted in this state under this section or another law
administered by the commission.
(e) The Texas Gaming Commission shall appoint an executive
director and other necessary personnel and adopt rules the
commission considers necessary or desirable for the public interest
in carrying out the policy and provisions of this section and the
other laws administered by the commission, including rules on:
(1) licensing and regulating casino owners, slot
establishment owners, gaming managers, gaming employees, and
manufacturers and distributors of gaming equipment, including the
qualifications, definitions, terms, and fees for licenses;
(2) criteria for awarding, denying, revoking, and
suspending licenses;
(3) exclusion of persons and age requirements;
(4) procedures for conducting investigations,
inspections, criminal background investigations, audits, complaint
investigations, and disciplinary hearings;
(5) reporting and internal control requirements for
license holders;
(6) consequences of criminal convictions of license
holders or applicants;
(7) enforcement provisions, including disciplinary
actions and penalties, and security requirements;
(8) prize payment and redemption;
(9) regulating the operations of casinos and slot
establishments; and
(10) standards for gaming equipment.
(f) The Texas Gaming Commission shall:
(1) issue not more than eight licenses to operate slot
establishments in this state to persons who are licensed to conduct
pari-mutuel wagering on horse or greyhound races at the location
licensed for conducting pari-mutuel wagering on horse or greyhound
races and who comply with requirements of this section and
commission rule;
(2) issue not more than six licenses to conduct casino
gaming to casino-anchored destination attraction development
projects located in different urban areas of this state that comply
with requirements of this section and commission rule;
(3) issue not more than two licenses to conduct casino
gaming to casino-anchored destination attraction development
projects located on islands in the Gulf of Mexico that are tourist
destinations with at least 1,000 guest rooms available for visitors
in hotels, motels, or condominiums existing on January 1, 2011, and
that comply with requirements of this section and commission rule;
and
(4) allow an Indian tribe that is recognized by the
United States government under federal law to operate slot machines
or casino gaming on its Indian land held in trust by the United
States on January 1, 1998, in accordance with federal law and:
(A) an effective gaming agreement that includes a
provision requiring the Indian tribe to remit to this state a
portion of its gaming revenue in an amount equal to the rate
provided in the agreement; or
(B) general state law that includes a provision
requiring the Indian tribe to remit to this state a portion of its
gaming revenue in an amount equal to the rate provided by the
general law.
(g) In determining whether or, in the case of multiple
applicants competing for a limited number of casino owner's
licenses or slot establishment owner's licenses within a geographic
area, to whom to grant a license, the Texas Gaming Commission shall
consider the following factors:
(1) the relative prospective revenue to be collected
by this state from the conduct of casino gaming at the casino or
slot gaming at the slot establishment and the overall economic
impact of each competing applicant's proposed gaming and associated
facilities;
(2) the relative number of residents of this state who
would be employed in an applicant's proposed casino or slot
establishment and any proposed associated hotel and nongaming
businesses and the relative extent of the applicant's good faith
plan to recruit, train, and promote a workforce that reflects the
diverse populations of this state in all employment
classifications;
(3) the relative extent to which an applicant's
proposed casino or slot establishment and any proposed associated
hotel and nongaming businesses could be reasonably expected to
encourage interstate tourism to this state;
(4) the relative extent to which the scope, design,
location, and construction of the applicant's casino or slot
establishment and any associated hotel and nongaming businesses
could be reasonably expected to contribute to developing a
first-class gaming industry in this state;
(5) the applicant's experience in conducting licensed
gaming operations and the applicant's financial ability to promptly
construct and adequately maintain the casino or slot establishment
sought to be licensed, including the experience of partners of the
applicant, of affiliated companies of the applicant or its
partners, of key personnel of the applicant or its partners, and of
operating companies under contract with the applicant; and
(6) the percentage of equity interest in the applicant
owned or to be owned by residents of this state.
(h) To ensure that a requisite level of economic development
benefiting the people of this state accompanies each casino or slot
establishment for which an owner's license is granted, the Texas
Gaming Commission shall require an applicant, as a condition to
receiving and holding an owner's license, to commit to building a
casino-anchored destination attraction development project or slot
establishment that includes total land and development costs of at
least:
(1) $400 million for an urban area project;
(2) $200 million for an island tourist destination
project; or
(3) $150 million for a slot establishment.
(i) Notwithstanding Subsection (f) of this section:
(1) a license for a casino-anchored destination
attraction development project may not be issued in a county
unless:
(A) a majority of the voters of the county voted
for the proposition that added this section to this constitution;
or
(B) the voters of the county have approved a
proposition legalizing casino gaming at a local option election
held under this section;
(2) not more than two casino owner's licenses may be
issued for casinos to be located in the same county; and
(3) a casino owner's license may not be issued for a
location in an area in which casino gaming or slot gaming is
prohibited under a gaming agreement between an Indian tribe and
this state.
(j) The Texas casino and slot gaming fund is a special fund
in the state treasury. All application fees, investigation fees,
and license fees collected by the Texas Gaming Commission or on the
commission's behalf related to casino and slot gaming shall be
deposited to the credit of the Texas casino and slot gaming fund.
Except as provided by this section, the Texas casino and slot gaming
fund shall be used only for the operation of the commission and the
administration of this section. If the money in the fund exceeds
the amount necessary for the operation of the commission and the
administration of this section, the legislature shall transfer any
excess amount to the dedicated account known as the property tax
relief fund in the general revenue fund. Money from the property
tax relief fund shall be appropriated only for a purpose that
results in a reduction of the average school district maintenance
and operations tax rate or as otherwise provided by general law.
(k) An applicant applying for an owner's license for a
casino-anchored destination attraction development project must
submit to the Texas Gaming Commission a $50 million application
fee. An applicant applying for an owner's license for a slot
establishment must submit to the commission a $25 million
application fee. If an applicant is not awarded an owner's license,
the commission shall refund the application fee less the costs
incurred by the commission in reviewing the application and
conducting a criminal background investigation on the applicant.
(l) A gaming tax in an amount equal to 15 percent of the
gross gaming revenue of the casino operated under the license is
imposed on each holder of a casino owner's license. The tax shall be
computed and paid on a monthly basis in accordance with the
procedures established by rule of the Texas Gaming Commission.
(m) A slot gaming tax in an amount equal to 35 percent of the
gross slot income of the slot establishment operated under the
license is imposed on each holder of a slot establishment owner's
license. The tax shall be computed and paid on a monthly basis in
accordance with the procedures established by rule of the Texas
Gaming Commission.
(n) Of the revenue from the taxes imposed by Subsections (l)
and (m) of this section:
(1) one-thirtieth of the revenue is allocated to the
municipality in which the casino to which the license relates is
located and one-thirtieth of the revenue is allocated to the county
in which the casino to which the license relates is located; or
(2) if the casino is located in an unincorporated
area, one-fifteenth of the revenue is allocated to the county in
which the casino to which the license relates is located.
(o) The comptroller of public accounts shall transfer the
appropriate amount allocated under Subsection (n) to the
appropriate municipalities and counties not less than monthly in
the manner the comptroller considers appropriate.
(p) Except as otherwise provided by this section, the
revenue from the taxes imposed by Subsections (l) and (m) of this
section is allocated as follows:
(1) one-twentieth to the general revenue fund for
appropriation only to fund a compulsive gambling program
established by the Texas Gaming Commission;
(2) one-thirtieth to the general revenue fund for
appropriation only to the Texas Gaming Commission to provide grants
to prosecuting attorneys for the investigation and prosecution of
offenses related to the possession of gambling devices and illegal
gambling operations; and
(3) the remainder to the property tax relief fund in
the general revenue fund.
(q) The comptroller of public accounts quarterly shall
determine the net amount of receipts collected from a casino or slot
establishment from the sales and use taxes, hotel occupancy taxes,
alcoholic beverage taxes, and franchise taxes imposed under general
law, or from other taxes imposed under general law as provided by
the legislature in general law, and shall deposit that amount in the
general revenue fund. The net amount deposited may only be
appropriated to fund the TEXAS grant program established under
Subchapter M, Chapter 56, Education Code, or a similar program
established by the legislature to provide grants to higher
education students in this state.
(r) Not more than 10 percent of the total floor space of a
casino or slot establishment may be used for gaming areas.
(s) Casinos and slot establishments are subject to all
applicable state laws and local ordinances related to health and
building codes, including rules adopted by the Texas Gaming
Commission. A local ordinance or zoning law may not prohibit the
development of a casino or slot establishment authorized by this
section, except that a casino or slot establishment may not be
located in an area that on January 1, 2011, was zoned exclusively
residential, unless otherwise provided by commission rule.
(t) The commissioners court of a county may at any time
order an election to legalize casino gaming under this section in
that county. The commissioners court shall order and hold an
election to legalize gaming under this section in the county if the
commissioners court is presented with a petition that meets the
requirements of this section and is certified as valid under this
section.
(u) A petition for a legalization election must include a
statement substantially as follows before the space reserved for
signatures on each page: "This petition is to require that an
election be held in (name of county) to legalize casino gaming in
(name of county)." A petition is valid only if it is signed by
registered voters of the county in a number that is not less than
three percent of the total number of votes cast for governor by
qualified voters of the county in the most recent gubernatorial
general election. Each voter must enter beside the voter's
signature the date the voter signs the petition. A signature may
not be counted as valid if the date of signing is earlier than the
90th day before the date the petition is submitted to the
commissioners court. Each voter must provide on the petition the
voter's current voter registration number, printed name, and
residence address, including zip code.
(v) Not later than the fifth day after the date a petition
for an election under this chapter is received in the office of the
commissioners court, the commissioners court shall submit the
petition for verification to the county clerk. The county clerk
shall determine whether the petition is signed by the required
number of registered voters of the county. Not later than the 30th
day after the date the petition is submitted to the clerk for
verification, the clerk shall certify in writing to the
commissioners court whether the petition is valid or invalid. If
the clerk determines that the petition is invalid, the clerk shall
state the reasons for that determination.
(w) If the county clerk certifies that a petition is valid,
not later than the 30th day after the date of certification, the
commissioners court shall order that an election be held in the
county on the next uniform election date provided under general law
that allows sufficient time to comply with applicable provisions of
general law. The commissioners court shall state in the order the
issue to be voted on. The county clerk shall notify the Texas
Gaming Commission by certified mail, return receipt requested, that
an election has been ordered. The ballot in a legalization election
shall be printed to provide for voting for or against the
proposition: "Legalizing casino gaming within (name of county)."
(x) If the majority of the votes cast in a legalization
election favor the legalization of casino gaming, casino gaming
authorized under this chapter is permitted within the county
holding the election effective on the 10th day after the date of the
election. The commissioners court of a county in which a
legalization election has been held shall give written notice of
the results of the election to the Texas Gaming Commission not later
than the third day after the date the election is canvassed. If
less than a majority of the votes cast in a legalization election in
any county are cast in favor of the legalization of casino gaming,
casino gaming is not permitted in the county, and a subsequent
election on the issue may not be held in the county before the
corresponding uniform election date one year after the date of the
election. If less than a majority of the votes cast in two
consecutive legalization elections within any county are cast in
favor of the legalization of casino gaming, casino gaming is not
permitted in the county, and a subsequent election on the issue may
not be held in the county before the corresponding uniform election
date five years after the date of the second election.
(y) It is a defense to prosecution for a gambling offense
under general law that the action was authorized under this section
or Texas Gaming Commission rule.
(z) All shipments of video lottery terminals or gaming
devices into, out of, or within this state authorized under this
section or a rule adopted by the Texas Gaming Commission are legal
shipments of the devices and are exempt from the provisions of 15
U.S.C. Sections 1171-1178, prohibiting the transportation of
gambling devices.
(aa) Each state agency, including the attorney general and
the comptroller of public accounts and each state or local law
enforcement agency, shall cooperate with the Texas Gaming
Commission as necessary to implement this section.
(bb) The legislature by general law may impose additional
restrictions or requirements for the conduct of casino and slot
gaming.
(cc) Unless specifically authorized by general law, a
political subdivision of this state may not impose:
(1) a tax on the payment of a casino or slot prize;
(2) a tax, fee, or other assessment on consideration
paid to play a casino or slot game authorized by this section; or
(3) a tax or fee on attendance at or admission to a
casino or slot establishment authorized by this section.
(dd) In this section, unless modified by general law:
(1) "Casino" means a facility at which casino gaming
is conducted by a licensed casino owner as authorized by this
section.
(2) "Casino gaming" means any game of chance or
similar activity that involves the making of a bet for
consideration. The term includes any type of slot machine or table
game wagering using money, casino credit, or any representation of
value. The term does not include bingo, charitable raffles, or the
state lottery authorized under Section 47 of this article.
(3) "Casino owner" means a person, trust, corporation,
partnership, limited partnership, association, limited liability
company, or other business enterprise that directly holds an
ownership or leasehold interest in a casino licensed as provided by
this section.
(4) "Gross gaming revenue" means the total amount of
consideration paid to play casino games less winnings paid to
players of the casino games.
(5) "Gross slot income" means the total amount of
consideration paid to play slot machines less winnings paid to
players of the slot machines.
(6) "Slot establishment" means a facility at which
slot gaming is conducted by a licensed slot establishment owner as
authorized by this section.
(7) "Slot establishment owner" means a person, trust,
corporation, partnership, limited partnership, association,
limited liability company, or other business enterprise that
directly holds an ownership or leasehold interest in a slot
establishment.
(8) "Slot gaming" means any game of chance that for
consideration is played on a slot machine. The term does not
include bingo, charitable raffles, or the state lottery authorized
under Section 47 of this article.
(9) "Slot machine" means a mechanical, electrical, or
other device or machine that, on insertion of a coin, token, or
similar object or on payment of consideration, is available to play
or operate a game, the play or operation of which, wholly or partly
by the element of chance, may deliver or entitle the person playing
or operating the device or machine to receive cash, premiums,
merchandise, tokens, or any other thing of value, whether the
payoff is made automatically from the device or machine or is made
in another manner.
SECTION 3. The following temporary provision is added to
the Texas Constitution:
TEMPORARY PROVISION. (a) This temporary provision applies
to the constitutional amendment proposed by the 82nd Legislature,
Regular Session, 2011, creating the Texas Gaming Commission and
authorizing and regulating casino games and slot machines by
licensed operators and certain Indian tribes to provide money for
the property tax relief fund and additional financial aid for
higher education students.
(b) Not later than January 1, 2012, the governor shall
appoint the initial members of the Texas Gaming Commission in
accordance with Section 47a, Article III, of this constitution. In
making the initial appointments, the governor shall designate one
member to a term expiring February 1, 2013, two members to terms
expiring February 1, 2015, and two members to terms expiring
February 1, 2017.
(c) Not later than March 1, 2012, the Texas Gaming
Commission shall adopt the rules, including any emergency rules,
necessary to implement Section 47a, Article III, of this
constitution.
(d) This temporary provision expires January 1, 2013.
SECTION 4. This proposed constitutional amendment shall be
submitted to the voters at an election to be held November 8, 2011.
The ballot shall be printed to permit voting for or against the
proposition: "The constitutional amendment creating the Texas
Gaming Commission and authorizing and regulating casino games and
slot machines by licensed operators and certain Indian tribes to
provide money for the property tax relief fund and additional
financial aid for higher education students."