86R1142 GCB-D
By: Deshotel H.B. No. 494
A BILL TO BE ENTITLED
AN ACT
relating to the operation of casino gaming in certain coastal areas
of this state by licensed persons to provide additional money for
residual windstorm insurance coverage and catastrophic flooding
assistance in the coastal areas; requiring occupational licenses or
certifications; authorizing fees; imposing a tax; creating
criminal offenses and providing other 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 2005 to read as follows:
CHAPTER 2005. CASINO GAMING
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2005.001. DEFINITIONS. In this chapter:
(1) "Casino game" means any game of chance, including
a game of chance in which the outcome may be partially determined by
skill or ability, that involves the making of a bet, as defined by
Section 47.01, Penal Code.
(2) "Casino gaming" means the conduct of casino games
authorized under this chapter.
(3) "Casino gaming manager" means a person certified
under this chapter to manage casino gaming operations at a location
authorized under this chapter to conduct casino gaming in this
state.
(4) "Commission" means the Texas Lottery Commission.
(5) "Executive director" means the executive director
of the commission.
(6) "Gaming vendor" means a person licensed under this
chapter to provide, maintain, manufacture, distribute, sell, or
lease casino gaming equipment and services to a person authorized
to operate casino gaming in this state.
Sec. 2005.002. APPLICABILITY OF FEDERAL LAW. All shipments
of casino gaming equipment and devices into, out of, or within this
state in connection with casino gaming 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.
SUBCHAPTER B. ADMINISTRATION
Sec. 2005.051. POWERS AND DUTIES OF COMMISSION AND
EXECUTIVE DIRECTOR. (a) The commission and executive director
have broad authority and shall exercise strict control over and
closely monitor casino gaming in this state to protect the public
health, welfare, and safety and ensure integrity, security,
honesty, and fairness in the conduct and administration of casino
gaming.
(b) The executive director may contract with or employ a
person to perform a function, activity, or service in connection
with casino gaming as prescribed by the executive director.
(c) The commission shall as necessary to protect the public
health, welfare, and safety:
(1) monitor casino gaming operations on a continuing
basis;
(2) establish standards for:
(A) the operation of casino gaming;
(B) the provision of casino gaming equipment and
services; and
(C) the establishment and maintenance of casino
gaming facilities; and
(3) inspect and examine all gaming facilities,
equipment, services, records, and operations to ensure compliance
with the standards established by the commission.
Sec. 2005.052. RULES AND PROCEDURES. (a) The commission
shall adopt all rules necessary to supervise casino gaming in this
state, administer this chapter, and ensure the security of casino
gaming operations in this state.
(b) The commission shall establish procedures for the
approval, monitoring, and inspection of casino gaming operations as
necessary to protect the public health, welfare, and safety and the
integrity of this state and to prevent financial loss to this state.
Sec. 2005.053. FEES. The commission shall establish the
application, certification, and certification renewal fees for
each type of certification issued under this chapter in amounts
reasonable and necessary to cover this state's costs incurred in
the administration of this chapter and the regulation of casino
gaming.
Sec. 2005.054. ANNUAL REPORT. The commission shall make an
annual report to the governor, the comptroller, and the legislature
that provides a summary of casino gaming revenues and expenses for
the state fiscal year preceding the report. The report must be in
the form and reported at the time provided by the General
Appropriations Act.
Sec. 2005.055. INVESTIGATIONS. The commission may
investigate a violation or alleged violation of:
(1) this chapter or rules adopted under this chapter
by any person; or
(2) the penal laws of this state in connection with the
administration of this chapter, the regulation of casino gaming, or
the conduct of casino gaming by a person authorized to operate
casino gaming under this chapter.
SUBCHAPTER C. CASINO GAMING
Sec. 2005.101. CASINO GAMING OPERATOR LICENSE. A person
may not conduct casino gaming in this state unless the person holds
a casino gaming operator license issued under this chapter.
Sec. 2005.102. ALLOCATION OF CASINO GAMING OPERATOR
LICENSES. The commission shall award not more than nine casino
gaming operator licenses to applicants as follows:
(1) one license in each of the counties of Galveston,
Jefferson, and Nueces, provided the license issued in Jefferson
County is for a location approved by the commissioners court of the
county that has interstate access and other appropriate
infrastructure;
(2) three licenses in Bexar and Harris Counties to
persons who are licensed to conduct pari-mutuel wagering on horse
and greyhound races in one of those counties, provided not more than
two licenses are awarded in either county; and
(3) one license in each of three first tier coastal or
second tier coastal counties, as those terms are defined by Section
2210.003, Insurance Code, to persons who are licensed to conduct
pari-mutuel wagering on horse or greyhound races in one of those
counties.
Sec. 2005.103. CERTIFICATES REQUIRED. (a) A person may not
provide, maintain, manufacture, distribute, sell, or lease casino
games or casino gaming equipment or services for use in this state
unless the person holds a gaming vendor certificate issued under
this chapter.
(b) A person may not act as a casino gaming manager for a
gaming facility in this state unless the person holds a casino
gaming manager certificate issued under this chapter.
(c) Unless the person holds the required gaming employee
certificate, a person may not act as a gaming employee in any gaming
employee position for which the commission by rule requires a
person to hold a certificate issued under this chapter.
Sec. 2005.104. GAMING VENDOR CERTIFICATE. (a) The
commission shall issue a gaming vendor certificate to an eligible
person with the resources and experience required to provide casino
games or casino gaming equipment and services for casino gaming
operations authorized under this chapter.
(b) The commission by rule shall establish the minimum
qualifications for a gaming vendor certificate to ensure a
competitive market for casino gaming equipment and services and the
availability of reliable casino gaming equipment and services,
consistent with the public health, welfare, and safety.
Sec. 2005.105. CASINO GAMING MANAGER CERTIFICATE. (a) The
commission shall issue a casino gaming manager certificate to an
eligible person with the qualifications and experience required to
manage casino gaming operations under this chapter.
(b) The commission by rule shall establish the minimum
qualifications for a casino gaming manager certificate necessary to
protect the public health, welfare, and safety.
Sec. 2005.106. GAMING EMPLOYEE CERTIFICATE. The commission
by rule and as necessary to protect the public health, welfare, and
safety may establish gaming employee positions that require a
certificate issued under this chapter to act in those positions.
Sec. 2005.107. BACKGROUND INVESTIGATIONS. Before issuing a
certificate to a person under this chapter, the commission shall
conduct a background investigation that includes obtaining
criminal history record information of the person seeking the
certificate to assist the commission in determining the person's
eligibility or suitability for the certificate.
SUBCHAPTER D. REVENUE
Sec. 2005.151. STATE CASINO GAMING ACCOUNT. The state
casino gaming account is a special account in the general revenue
fund. The account consists of all revenue received by the
commission from casino gaming, fees received under this chapter,
and all money credited to the account from any other fund or source
under law.
Sec. 2005.152. CASINO GAMING TAX. (a) A casino gaming tax
in an amount equal to 18 percent of a casino's gross gaming revenue
is imposed on each holder of a casino gaming operator's license.
(b) For each state fiscal year, the comptroller shall
allocate the revenue from the tax imposed under this section and
transfer to:
(1) the catastrophe reserve trust fund established
under Subchapter J, Chapter 2210, Insurance Code, the lesser of:
(A) 50 percent of the tax revenue imposed under
this section; or
(B) the amount sufficient to ensure that the
premium and other revenue of the Texas Windstorm Insurance
Association together with the money allocated under this section
equals the insured losses and operating expenses of the association
for the state fiscal year; and
(2) the catastrophic flooding assistance trust fund
established under Section 2005.153 the remainder of the tax revenue
after making a transfer as required by Subdivision (1).
(c) The comptroller by rule shall adopt a schedule for the
collection of the tax imposed under this section and the transfer of
tax revenue under Subsection (b).
(d) Title 2, Tax Code, applies to the tax imposed under this
section.
Sec. 2005.153. CATASTROPHIC FLOODING ASSISTANCE TRUST
FUND. (a) The catastrophic flooding assistance trust fund is
established outside the treasury and is administered by the office
of the governor. Credits of money in the fund are not state funds or
subject to legislative appropriation.
(b) The trust fund consists of money deposited to the fund
under Section 2005.152 and appropriations to the fund made by the
legislature.
(c) If the office of the governor under Section 418.014,
Government Code, declares a state of disaster regarding
catastrophic flooding in a coastal area of this state, the governor
shall make money in the fund available to the Texas Division of
Emergency Management for the purpose of providing emergency relief
under the state emergency management plan for victims of loss
caused by the catastrophic flooding.
(d) Interest and income from the assets of the trust fund
shall be credited to and deposited in the trust fund.
SUBCHAPTER E. OFFENSES; DISCIPLINARY ACTIONS; PENALTIES
Sec. 2005.201. MANIPULATION OR TAMPERING. (a) A person
commits an offense if the person intentionally or knowingly
manipulates the outcome of a casino game, the amount of a casino
game prize, or the operation of a casino gaming device by physical,
electronic, or other means, other than in accordance with
commission rules.
(b) An offense under this section is a felony of the third
degree.
Sec. 2005.202. SALE OF CASINO GAME TO INDIVIDUAL YOUNGER
THAN 18 YEARS OF AGE. (a) A person who is a casino gaming manager
or an employee or agent of a casino gaming manager commits an
offense if the person intentionally or knowingly:
(1) sells or offers to sell a play of a casino game to
an individual the person knows is younger than 18 years of age or
permits the individual to purchase a play of a casino game; or
(2) pays money or issues a credit slip or other
winnings for a play of a casino game to an individual the person
knows is younger than 18 years of age.
(b) An individual who is younger than 18 years of age
commits an offense if the individual:
(1) purchases a play of a casino game;
(2) accepts money, a credit slip, or other payment of
winnings for a play of a casino game; or
(3) falsely represents the individual to be 18 years
of age or older by displaying evidence of age that is false or
fraudulent or misrepresents in any way the individual's age in
order to purchase a play of a casino game.
(c) An offense under Subsection (a) is a Class B
misdemeanor.
(d) An offense under Subsection (b) is a misdemeanor
punishable by a fine not to exceed $250.
Sec. 2005.203. DISCIPLINARY ACTIONS. (a) The commission
may refuse to issue a license or certificate or may revoke, suspend,
or refuse to renew a license or certificate or may reprimand a
license or certificate holder for a violation of this chapter,
other state law, or a rule of the commission.
(b) If the commission proposes to take action against a
license or certificate holder or applicant under Subsection (a),
the license or certificate holder or applicant is entitled to
notice and a hearing.
(c) The commission may place on probation subject to
reasonable conditions a person whose license or certificate is
suspended under this section.
(d) The commission may summarily suspend a license or
certificate issued under this chapter in the same manner as the
commission is authorized to suspend a license under Section
466.160, Government Code, if the commission determines that the
action is necessary to maintain the integrity, security, or
fairness of casino gaming.
(e) The commission by rule shall develop a system for
monitoring a license or certificate holder's compliance with this
chapter.
Sec. 2005.204. ADMINISTRATIVE PENALTY. (a) The commission
may impose an administrative penalty against a person who violates
this chapter or a rule or order adopted by the commission under this
chapter in the same manner as the commission is authorized to impose
an administrative penalty under Subchapter M, Chapter 2001.
(b) The amount of the administrative penalty may not exceed
$1,000 for each violation. Each day a violation continues or occurs
may be considered a separate violation for purposes of imposing a
penalty.
(c) In determining the amount of the penalty, the executive
director shall consider:
(1) the seriousness of the violation, including the
nature, circumstances, extent, and gravity of the violation;
(2) the history of previous violations;
(3) the amount necessary to deter future violations;
(4) efforts to correct the violation; and
(5) any other matter that justice may require.
(d) The notice, hearing, and appeal for an administrative
penalty assessed under this section shall be provided or conducted
in the same manner as notice, hearing, and appeals are provided or
conducted under Subchapter M, Chapter 2001.
Sec. 2005.205. CIVIL PENALTY. (a) A person who violates
this chapter or a rule adopted by the commission under this chapter
is liable to the state for a civil penalty not to exceed $5,000 for
each day of violation.
(b) At the request of the commission, the attorney general
shall bring an action to recover a civil penalty authorized by this
section. The attorney general may recover reasonable expenses,
including attorney's fees, incurred in recovering the civil
penalty.
SECTION 2. Section 411.108(a-1), Government Code, is
amended to read as follows:
(a-1) The Texas Lottery Commission is entitled to obtain
from the department criminal history record information maintained
by the department that relates to:
(1) a person licensed under Chapter 2001, Occupations
Code, or described by Section 2001.3025, Occupations Code; or
(2) a person holding or applying for a license or
certificate under Chapter 2005, Occupations Code.
SECTION 3. Section 466.024(b), Government Code, is amended
to read as follows:
(b) The commission shall adopt rules prohibiting the
operation of any game using a video lottery machine or video gaming
machine, except in accordance with Chapter 2005, Occupations Code.
SECTION 4. Section 47.02(c), Penal Code, as effective April
1, 2019, 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) was permitted under Chapter 2004, Occupations
Code;
(4) was permitted under Chapter 2005, Occupations
Code;
(5) consisted entirely of participation in the state
lottery authorized by the State Lottery Act (Chapter 466,
Government Code);
(6) [(5)] was permitted under Subtitle A-1, Title 13,
Occupations Code (Texas Racing Act); or
(7) [(6)] 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.
SECTION 5. Section 47.09, Penal Code, as effective April 1,
2019, is amended by amending Subsection (a) and adding Subsection
(c) 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;
(C) Chapter 2004, Occupations Code;
(D) Chapter 2005, Occupations Code;
(E) Subtitle A-1, Title 13, Occupations Code
(Texas Racing Act); or
(F) [(E)] Chapter 280, Finance 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.
(c) Subsection (a)(1)(D) applies to a person manufacturing,
possessing, or operating a gambling device under a license or
certificate issued under Chapter 2005, Occupations Code.
SECTION 6. Chapter 47, Penal Code, is amended by adding
Section 47.095 to read as follows:
Sec. 47.095. INTERSTATE OR FOREIGN COMMERCE DEFENSE. It is
a defense to prosecution under this chapter that a person sells,
leases, transports, possesses, stores, or manufactures a gambling
device with the authorization of the Texas Lottery Commission under
Chapter 2005, Occupations Code, for transportation in interstate or
foreign commerce.
SECTION 7. (a) As soon as practicable after the effective
date of this Act, the Texas Lottery Commission shall adopt the rules
necessary to implement casino gaming in accordance with Chapter
2005, Occupations Code, as added by this Act.
(b) The Texas Lottery Commission may adopt initial rules for
purposes of implementing casino gaming in accordance with Chapter
2005, Occupations Code, as added by this Act, that expire not later
than May 1, 2020. Chapter 2001, Government Code, does not apply to
the adoption of those rules. This subsection expires June 1, 2020.
SECTION 8. This Act takes effect December 1, 2019, but only
if the constitutional amendment authorizing the legislature to
authorize the operation of casino gaming in certain coastal areas
of this state by licensed persons to provide additional money for
residual windstorm insurance coverage and catastrophic flooding
assistance in the coastal areas is approved by the voters. If that
amendment is not approved by the voters, this Act has no effect.