73R7535 JSA-D
By Wilson H.B. No. 1587
Substitute the following for H.B. No. 1587:
By Wilson C.S.H.B. No. 1587
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the operation of the state lottery; creating the State
1-3 Lottery Commission; providing penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 1.02(1) and (2), State Lottery Act
1-6 (Article 179g, Vernon's Texas Civil Statutes), are amended to read
1-7 as follows:
1-8 (1) "Commission" means the State Lottery Commission
1-9 <"Director" means the director of the division>.
1-10 (2) "Executive director" means the executive director
1-11 of the commission <"Division" means the lottery division
1-12 established in the office of the comptroller under this Act>.
1-13 SECTION 2. Sections 1.03 and 2.01, State Lottery Act
1-14 (Article 179g, Vernon's Texas Civil Statutes), are amended to read
1-15 as follows:
1-16 Sec. 1.03. Application of Sunset Act. <(a)> The commission
1-17 <lottery division> is subject to Chapter 325, Government Code
1-18 (Texas Sunset Act). Unless continued in existence as provided by
1-19 that chapter, the commission <division> is abolished and this Act
1-20 expires September 1, 2003.
1-21 <(b) A contract between the division and a lottery operator
1-22 under Section 2.02(g) of this Act must terminate on or before
1-23 September 1, 2004.>
1-24 Sec. 2.01. EXECUTIVE DIRECTOR <Lottery Division>. (a) <A
2-1 division to administer a state lottery is created in the office of
2-2 the comptroller. The division is administered by the director.>
2-3 <(b)> The governor <comptroller> shall appoint a person to
2-4 serve as executive director with the advice and consent of the
2-5 senate <and chief executive officer of the division subject to the
2-6 comptroller's direction>. The executive director holds office for
2-7 a term concurrent with that <at the will> of the governor
2-8 <comptroller> and is specifically exempted from the Position
2-9 Classification Act of 1961 (Article 6252-11, Vernon's Texas Civil
2-10 Statutes). The executive director is entitled to receive an annual
2-11 salary in an amount set by the commission <comptroller>. The
2-12 executive director also is entitled to reimbursement for expenses
2-13 actually and necessarily incurred in the performance of the
2-14 executive director's duties.
2-15 (b) <(c)> The executive director may create, abolish,
2-16 transfer, and consolidate bureaus and other units in the commission
2-17 <division> that are not expressly established by law as the
2-18 executive director determines to be necessary for the efficient
2-19 operation of the commission <division>.
2-20 (c) <(d)> Except as otherwise provided by law, the executive
2-21 director may appoint deputies, assistants, other officers and
2-22 employees, committees, and consultants and may prescribe their
2-23 powers and their expenses. Commission <Division> employees serve
2-24 at the will of the executive director. The executive director may
2-25 not employ any person who would be denied a license as a sales
2-26 agent under Section 3.02 of this Act. The executive director may
2-27 not employ or continue to employ any person who owns a financial
3-1 interest in a lottery sales agency or a lottery operator.
3-2 (d) <(e)> The executive director may employ or contract with
3-3 marketing representatives to promote the sale of tickets, to
3-4 encourage persons to apply to become sales agents, or to
3-5 investigate the qualifications of sales agent applicants. The
3-6 marketing representatives are exempted from the Position
3-7 Classification Act of 1961 (Article 6252-11, Vernon's Texas Civil
3-8 Statutes) and may be compensated based on a sales incentive system
3-9 to be established by the executive director.
3-10 (e) <(f)> The legislature intends that the commission
3-11 <division> be a self-supporting, revenue-raising agency of state
3-12 government. Except as provided by <Subsection (g) of this section
3-13 or by> Section 13, Chapter 6 <of H.B. No. 54>, Acts of the 72nd
3-14 Legislature, 1st Called Session, 1991, no appropriation, loan, or
3-15 other transfer of state funds may be made to the commission
3-16 <division>.
3-17 <(g) The comptroller may transfer to the division amounts
3-18 appropriated to the comptroller for purposes other than the
3-19 administration of this Act. If the comptroller proposes to
3-20 transfer amounts under this subsection, the comptroller shall
3-21 notify the Legislative Budget Board in writing of the amount of the
3-22 proposed transfer. The comptroller may not make the proposed
3-23 transfer unless the board approves it. If the board does not
3-24 approve or disapprove the proposed transfer before the 10th day
3-25 after the date that the comptroller notifies the board of the
3-26 proposed transfer, the board is considered to have approved the
3-27 transfer. If the board disapproves the proposed transfer, the
4-1 comptroller may request the governor to make a proposal for the
4-2 transfer of an appropriation as provided by Chapter 317, Government
4-3 Code.>
4-4 <(h) The comptroller shall reimburse any amount of an
4-5 appropriation transferred under Subsection (g) of this section to
4-6 the account or fund from which it was transferred. The
4-7 reimbursement must:>
4-8 <(1) be made from funds received by the comptroller
4-9 for license fees and ticket sales under this Act; and>
4-10 <(2) be made not later than the first anniversary of
4-11 the date of the transfer.>
4-12 <(i) The comptroller's authority to transfer funds to the
4-13 division under Subsection (g) of this section expires September 1,
4-14 1993. This subsection and Subsections (g) and (h) of this section
4-15 expire January 1, 1995.>
4-16 (f) <(j)> Commission <Division> employees are specifically
4-17 exempted from the Position Classification Act of 1961 (Article
4-18 6252-11, Vernon's Texas Civil Statutes). The salary of these
4-19 employees shall be set by the executive director.
4-20 (g) <(l)> The legislature intends that advertisements or
4-21 promotions sponsored by the commission <comptroller's office or the
4-22 division> for the lottery not be of a nature that unduly influences
4-23 any person to purchase a lottery ticket or number.
4-24 SECTION 3. Article 1, State Lottery Act (Article 179g,
4-25 Vernon's Texas Civil Statutes), is amended by adding Section 1.041
4-26 to read as follows:
4-27 Sec. 1.041. DAILY ON-LINE GAME. (a) The commission shall
5-1 conduct a continuous daily on-line game with daily ticket sales.
5-2 (b) The commission shall initiate the operation of the daily
5-3 on-line game not later than April 1, 1994.
5-4 SECTION 4. Section 2.02, State Lottery Act (Article 179g,
5-5 Vernon's Texas Civil Statutes), is amended to read as follows:
5-6 Sec. 2.02. POWERS AND DUTIES OF EXECUTIVE <COMPTROLLER,>
5-7 DIRECTOR<,> AND COMMISSION <DIVISION>. (a) The commission
5-8 <comptroller> and executive director have broad authority and shall
5-9 exercise strict control and close supervision over all lottery
5-10 games conducted in this state to promote and ensure integrity,
5-11 security, honesty, and fairness in the operation and administration
5-12 of the lottery.
5-13 (b) The commission <comptroller> shall adopt all rules
5-14 necessary to administer this Act. The executive director may
5-15 propose rules to be adopted by the commission <comptroller>, but
5-16 the executive director's proposed rules have no effect until
5-17 adopted by the commission <comptroller>.
5-18 (c) The commission <comptroller> shall adopt rules to the
5-19 extent they are not inconsistent with the Open Meetings Act
5-20 (Article 6252-17, Vernon's Texas Civil Statutes) and the Open
5-21 Records Act (Article 6252-17a, Vernon's Texas Civil Statutes)
5-22 governing the:
5-23 (1) security for the lottery and the commission
5-24 <division>, including the development of an internal security plan;
5-25 (2) apportionment of the total revenues from the sale
5-26 of tickets and from all other sources in the amounts provided by
5-27 this Act;
6-1 (3) enforcement of prohibitions on the sale of tickets
6-2 to or by an individual younger than 18 years of age; and
6-3 (4) enforcement of prohibitions on a person playing a
6-4 lottery game or activity by telephone.
6-5 (d) The commission <comptroller> may adopt rules governing
6-6 the establishment and operation of the lottery, including rules
6-7 governing:
6-8 (1) the type of lottery games or activities to be
6-9 conducted;
6-10 (2) the price of each ticket;
6-11 (3) the number of winning tickets and amount of the
6-12 prize paid on each winning ticket;
6-13 (4) the frequency of the drawing or selection of a
6-14 winning ticket;
6-15 (5) the number and types of locations at which a
6-16 ticket may be sold;
6-17 (6) the method to be used in selling a ticket;
6-18 (7) the use of vending machines or electronic or
6-19 mechanical devices of any kind, other than machines or devices that
6-20 dispense currency or coins as prizes;
6-21 (8) the manner of paying a prize to the holder of a
6-22 winning ticket;
6-23 (9) the investigation of possible violations of this
6-24 Act or any rule adopted under this Act;
6-25 (10) the means of advertising to be used for the
6-26 lottery;
6-27 (11) the qualifications of vendors of lottery services
7-1 or equipment;
7-2 (12) the confidentiality of information relating to
7-3 the operation of the lottery, including:
7-4 (A) trade secrets;
7-5 (B) security measures, systems, or procedures;
7-6 (C) security reports;
7-7 (D) bids or other information regarding the
7-8 commission's <division's> contracts, if disclosure of the
7-9 information would impair the commission's <division's> ability to
7-10 contract for facilities, goods, or services on terms favorable to
7-11 the commission <division>;
7-12 (E) personnel information unrelated to
7-13 compensation, duties, qualifications, or responsibilities; and
7-14 (F) information obtained by commission
7-15 <division> security officers or investigators;
7-16 (13) the development and availability of a model
7-17 agreement governing the division of a prize among multiple
7-18 purchasers of a winning ticket purchased through a group purchase
7-19 or pooling arrangement;
7-20 (14) the criteria to be used in evaluating bids for
7-21 contracts for lottery facilities, goods, and services; or
7-22 (15) any other matter necessary or desirable as
7-23 determined by the commission <comptroller>, to promote and ensure:
7-24 (A) the integrity, security, honesty, and
7-25 fairness of the operation and administration of the lottery; and
7-26 (B) the convenience of players and holders of
7-27 winning tickets.
8-1 (e) If the executive director authorizes a person who is not
8-2 an employee of the commission <division> to sell tickets, the
8-3 person must be licensed as a sales agent by the commission
8-4 <division>. The executive director may establish a provisional
8-5 license or other classes of licenses necessary to regulate and
8-6 administer the quantity and type of lottery games or activities
8-7 provided at each licensed location. Each sales agent shall post a
8-8 cash bond, surety bond, letter of credit, certificate of deposit,
8-9 or other security approved by the executive director, including the
8-10 contribution of cash to a pooled bond fund established by the
8-11 executive director to protect the state from possible losses. The
8-12 amount of the security shall be determined by the executive
8-13 director and shall reflect the possible losses to the state from
8-14 the operation of the sales agent. The executive director may also
8-15 require a sales agent to maintain insurance if necessary to protect
8-16 the interests of the state. As prescribed by rule <division
8-17 rules>, each sales agent shall prominently display the license in
8-18 each place of business or activity at which the sales agent sells
8-19 tickets.
8-20 (f) The commission <comptroller> shall make an annual report
8-21 to the governor and the legislature that provides a summary of
8-22 lottery revenues, prize disbursements, and other expenses for the
8-23 fiscal year preceding the report. The report must be in the form
8-24 and reported in the time provided by the General Appropriations
8-25 Act.
8-26 (g) The executive director may contract with or employ a
8-27 person to perform a function, activity, or service in connection
9-1 with the operation of the lottery as prescribed by the executive
9-2 director. A person with whom the executive director contracts to
9-3 operate a lottery must be eligible for a sales agent license under
9-4 Section 3.02 of this Act.
9-5 (h) <A contract for independent consulting, management
9-6 services, or activities related to the establishment or
9-7 implementation of lottery operations is not subject to:>
9-8 <(1) the State Purchasing and General Services Act
9-9 (Article 601b, Vernon's Texas Civil Statutes);>
9-10 <(2) the Professional Services Procurement Act
9-11 (Article 664-4, Vernon's Texas Civil Statutes);>
9-12 <(3) Chapter 454, Acts of the 65th Legislature,
9-13 Regular Session, 1977 (Article 6252-11c, Vernon's Texas Civil
9-14 Statutes); or>
9-15 <(4) the Information Resources Management Act (Article
9-16 4413(32j), Revised Statutes).>
9-17 <(i) This subsection and Subsection (h) of this section
9-18 expire September 1, 1993.>
9-19 <(j)> Each lottery operator's and sales agent's records are
9-20 subject to audit by the commission <division, the comptroller,> and
9-21 the state auditor. For the purpose of carrying out this Act, the
9-22 executive director<, comptroller,> or state auditor may examine all
9-23 books, records, papers, or other objects that the executive
9-24 director<, comptroller,> or state auditor determines are necessary
9-25 for conducting a complete examination under this Act and may also
9-26 examine under oath any officer, director, or employee of a lottery
9-27 operator or sales agent. The executive director<, comptroller,> or
10-1 state auditor may conduct an examination at the principal office or
10-2 any other office of the lottery operator or sales agent or may
10-3 require the lottery operator or sales agent to produce the records
10-4 at the office of the commission <division, comptroller,> or state
10-5 auditor. If a sales agent refuses to permit an examination or to
10-6 answer any question authorized by this subsection, the executive
10-7 director <comptroller> may summarily suspend the license of the
10-8 sales agent under Section 3.03 of this Act until the examination is
10-9 completed as required. Section 321.013(h), Government Code, does
10-10 not apply to an audit of a lottery operator or sales agent.
10-11 (i) <(k)> The commission <comptroller> shall adopt rules
10-12 prohibiting the operation of any game using a video lottery machine
10-13 or machine. As used in this subsection "video lottery machine" or
10-14 "machine" means any electronic video game machine that, upon
10-15 insertion of cash, is available to play or simulate the play of a
10-16 video game, including but not limited to video poker, keno, and
10-17 blackjack, utilizing a video display and microprocessors in which
10-18 the player may receive free games or credits that can be redeemed
10-19 for cash, coins or tokens, or that directly dispenses cash, coins,
10-20 or tokens.
10-21 SECTION 5. Section 2.03(a), State Lottery Act (Article 179g,
10-22 Vernon's Texas Civil Statutes), is amended to read as follows:
10-23 (a) The executive director or a lottery operator may not
10-24 establish or operate a lottery game or activity in which the winner
10-25 is chosen on the basis of the outcome of a sports event.
10-26 SECTION 6. Sections 2.04(a)-(f), (h), and (k), State Lottery
10-27 Act (Article 179g, Vernon's Texas Civil Statutes), are amended to
11-1 read as follows:
11-2 (a) The executive director may establish procedures for the
11-3 purchase or lease of facilities, goods, and services and make any
11-4 purchases, leases, or contracts that are necessary for carrying out
11-5 the purposes of this Act. The procedures shall, as determined
11-6 feasible and appropriate by the executive director, promote
11-7 competition to the maximum extent possible. In all procurement
11-8 decisions, the executive director shall take into account the
11-9 particularly sensitive nature of the lottery and shall act to
11-10 promote and ensure integrity, security, honesty, and fairness in
11-11 the operation and administration of the lottery and the objective
11-12 of producing revenues for the state treasury.
11-13 (b) The executive director may not award a contract for the
11-14 purchase or lease of facilities, goods, or services related to
11-15 lottery operations to a person who would be denied a license as a
11-16 sales agent under Section 3.02 of this Act.
11-17 (c) The procurement procedures adopted by the executive
11-18 director shall, as determined feasible and appropriate by the
11-19 executive director, afford any party who is aggrieved by the terms
11-20 of a solicitation or the award of a contract an opportunity to
11-21 protest the executive director's action to the commission
11-22 <comptroller>. The protest procedures shall provide for an
11-23 expedient resolution of the protest in order to avoid substantially
11-24 delaying a solicitation or contract award that is necessary for the
11-25 timely implementation of a lottery game. A protest must be in
11-26 writing and be filed with the commission <comptroller> not later
11-27 than 72 hours after receipt of notice of the executive director's
12-1 action.
12-2 (d) A party who is aggrieved by the commission's
12-3 <comptroller's> resolution of a protest under Subsection (c) of
12-4 this section may file an action in the district court of Travis
12-5 County. The court shall give preference to hearings and trials of
12-6 actions under this section. If the party filing the action seeks
12-7 to enjoin the implementation of a solicitation or contract, the
12-8 party shall post a bond that is payable to the state if the party
12-9 does not prevail in the appeal, and is in an amount sufficient to
12-10 compensate the state for the revenue that would be lost due to the
12-11 delay in lottery operations.
12-12 (e) A contract for the acquisition or provision of
12-13 facilities, supplies, equipment, materials, or services related to
12-14 the operation of the lottery shall provide for liquidated damages
12-15 and a performance bond in an amount equal to the executive
12-16 director's best available estimate of the revenue that would be
12-17 lost if the contractor fails to meet deadlines specified in the
12-18 contract.
12-19 (f) On request of the executive director, the <State
12-20 Purchasing and> General Services Commission shall assist the
12-21 executive director in:
12-22 (1) acquiring facilities, supplies, materials,
12-23 equipment, and services under the State Purchasing and General
12-24 Services Act (Article 601b, Vernon's Texas Civil Statutes); or
12-25 (2) establishing procedures for the executive
12-26 director's accelerated acquisition of facilities, supplies,
12-27 materials, equipment, and services for the operation of the
13-1 lottery.
13-2 (h) Notwithstanding the provisions of the Public Utility
13-3 Regulatory Act (Article 1446c, Vernon's Texas Civil Statutes), the
13-4 executive director <comptroller> may negotiate rates and execute
13-5 contracts with telecommunications service providers for the
13-6 interexchange services necessary for the operation of the lottery.
13-7 The executive director <comptroller> may acquire transmission
13-8 facilities by lease, purchase, or lease-purchase. The acquisition
13-9 of transmission facilities shall be done on a competitive bid basis
13-10 if possible.
13-11 (k) The commission <comptroller> shall require any person
13-12 seeking to contract for goods or services relating to the
13-13 implementation and administration of this Act to submit to
13-14 competitive bidding procedures in accordance with rules established
13-15 by the commission <comptroller>. Such procedures shall be for the
13-16 purpose of insuring fairness and integrity.
13-17 SECTION 7. Section 2.05(a), State Lottery Act (Article 179g,
13-18 Vernon's Texas Civil Statutes), is amended to read as follows:
13-19 (a) In all contracts for lottery equipment, supplies,
13-20 services, and advertising, the commission <division> and each
13-21 lottery operator shall give preference to equipment or supplies
13-22 produced in this state or services or advertising offered by
13-23 bidders from this state, the cost to the state and quality being
13-24 equal.
13-25 SECTION 8. Sections 2.06(a) and (c), State Lottery Act
13-26 (Article 179g, Vernon's Texas Civil Statutes), are amended to read
13-27 as follows:
14-1 (a) The executive director<, the division,> and each lottery
14-2 operator shall take positive steps to:
14-3 (1) inform minority businesses of opportunities to:
14-4 (A) provide lottery equipment and supplies to
14-5 the commission <division>;
14-6 (B) provide services, including advertising, to
14-7 the commission <division> for the operation of the lottery; or
14-8 (C) obtain a license to sell lottery tickets;
14-9 (2) waive or modify bond requirements, if feasible;
14-10 (3) award contracts for lottery equipment or supplies
14-11 to minority businesses when possible;
14-12 (4) award contracts for lottery services, including
14-13 advertising, to minority businesses when possible;
14-14 (5) license minority businesses as sales agents;
14-15 (6) monitor the effectiveness of the efforts to
14-16 increase the ability of minority businesses to do business with the
14-17 commission <division>; and
14-18 (7) require all bidders or contractors, when
14-19 appropriate, to include specific plans or arrangements to utilize
14-20 subcontracts with minority businesses.
14-21 (c) The commission <comptroller> shall annually report to
14-22 the legislature and the governor on the level of minority business
14-23 participation as pertains to both the commission's <division's>
14-24 contracts and the licensure of sales agents. The report shall
14-25 include recommendations for the improvement of minority business
14-26 opportunities in lottery-related business.
14-27 SECTION 9. Sections 2.07-2.11, State Lottery Act (Article
15-1 179g, Vernon's Texas Civil Statutes), are amended to read as
15-2 follows:
15-3 Sec. 2.07. Television Contracts. If the drawing or
15-4 selection of winning tickets is televised under a contract with the
15-5 commission <division>, the contract must be awarded by competitive
15-6 bid. The commission <comptroller> shall adopt rules governing the
15-7 competitive bidding process. Money received under the contract
15-8 shall be deposited in the state lottery account established under
15-9 Section 5.02 of this Act.
15-10 Sec. 2.08. Publicity of Individuals Prohibited. A state
15-11 officer <or employee>, including a commission member or <the
15-12 comptroller,> the executive director, or an officer or employee of
15-13 the commission <comptroller's office or the division,> may not
15-14 appear in a paid <an> advertisement <or promotion> for the lottery
15-15 that is sponsored by the commission <comptroller's office or the
15-16 division> or in a televised lottery drawing. A paid <An>
15-17 advertisement <or promotion> for the lottery may not contain the
15-18 likeness or name of a state officer <or employee>, including a
15-19 commission member or <the comptroller,> the executive director, or
15-20 an officer or employee of the commission <comptroller's office or
15-21 the division>. In connection with providing security for the
15-22 lottery, this section shall not prohibit a security officer or
15-23 investigator employed by the commission <division> from appearing
15-24 in a televised lottery drawing <or other promotion> for the lottery
15-25 that is sponsored by the commission <comptroller's office or the
15-26 division>. Notwithstanding the provisions of this section, the
15-27 executive director may designate an employee of the commission
16-1 <division> to participate in a promotional event<, the purpose of
16-2 which is to award a prize>.
16-3 Sec. 2.09. Audit. The executive director shall provide for
16-4 a certified public accountant to conduct an independent audit for
16-5 each fiscal year of all accounts and transactions of the lottery.
16-6 The certified public accountant may not have, as determined by the
16-7 executive director, a significant financial interest in a sales
16-8 agent, lottery vendor, or lottery operator. The certified public
16-9 accountant shall present an audit report to the executive director,
16-10 the commission <comptroller>, the governor, and the legislature not
16-11 later than April 1 of the year following the fiscal year for which
16-12 the audit was performed. The report must contain recommendations
16-13 to enhance the earnings capability of the lottery and improve the
16-14 efficiency of lottery operations. The state auditor may review the
16-15 results of and working papers related to the audit.
16-16 Sec. 2.10. Investigations. The attorney general, the
16-17 district attorney for Travis County, or the district attorney,
16-18 criminal district attorney, or county attorney performing the
16-19 duties of district attorney for the county in which the violation
16-20 or alleged violation occurred may investigate a violation or
16-21 alleged violation of this Act and of the penal laws of this state
16-22 by the commission <division> or its employees, a sales agent, a
16-23 lottery vendor, or a lottery operator.
16-24 Sec. 2.11. Enforcement. (a) The executive director
16-25 <comptroller> or designated personnel of the commission <division>
16-26 may investigate violations of this Act and violations of the rules
16-27 adopted under this Act. After conducting investigations, the
17-1 executive director <comptroller>, a person designated by the
17-2 commission <comptroller>, or any law enforcement agency may file a
17-3 complaint with the district attorney of Travis County or with the
17-4 district attorney of the county in which a violation is alleged to
17-5 have occurred.
17-6 (b) The executive director <comptroller> has the
17-7 administrative, enforcement, and collection powers provided by
17-8 Subtitle B, Title 2, Tax Code, in regard to the lottery. For
17-9 purposes of the application of Title 2 of the Tax Code:
17-10 (1)<,> the state's share of proceeds from the sale of
17-11 lottery tickets is treated as if it were a tax; and
17-12 (2) a power granted to the comptroller may be
17-13 exercised by the commission.
17-14 SECTION 10. Article 2, State Lottery Act (Article 179g,
17-15 Vernon's Texas Civil Statutes), is amended by adding Section 2.111
17-16 to read as follows:
17-17 Sec. 2.111. VENUE. Venue is proper in Travis County or any
17-18 county in which venue is proper under Chapter 13, Code of Criminal
17-19 Procedure, and its subsequent amendments for:
17-20 (1) an offense under this Act;
17-21 (2) an offense under the Penal Code, if the accused:
17-22 (A) is a lottery operator, lottery vendor, sales
17-23 agent, or employee of the division; and
17-24 (B) is alleged to have committed the offense
17-25 while engaged in lottery activities; or
17-26 (3) an offense that involves property consisting of or
17-27 including lottery tickets under Title 7 or 11, Penal Code, and its
18-1 subsequent amendments.
18-2 SECTION 11. Sections 2.12(a)-(f), State Lottery Act (Article
18-3 179g, Vernon's Texas Civil Statutes), are amended to read as
18-4 follows:
18-5 (a) The executive director shall maintain a department of
18-6 security in the commission <division>. The executive director
18-7 shall appoint a deputy to administer the department. The deputy
18-8 must be qualified by training and experience in law enforcement or
18-9 security to supervise, direct, and administer the activities of the
18-10 department.
18-11 (b) The executive director may employ security officers or
18-12 investigators as the executive director considers necessary and may
18-13 commission security officers or investigators as peace officers.
18-14 The deputy and all investigators employed by the department of
18-15 security as peace officers must meet the requirements under Chapter
18-16 415, Government Code, for employment and commission as peace
18-17 officers.
18-18 (c) A security officer or investigator employed by the
18-19 department of security or a peace officer who is working in
18-20 conjunction with the commission <comptroller> or the Department of
18-21 Public Safety in the enforcement of this Act, without a search
18-22 warrant, may search and seize a lottery vending machine, lottery
18-23 computer terminal, or other lottery equipment that is located on
18-24 premises for which a person holds a sales agent license issued
18-25 under this Act.
18-26 (d) The Department of Public Safety, at the commission's
18-27 <comptroller's> request, shall perform a full criminal background
19-1 investigation of a prospective deputy or investigator of the
19-2 department of security. The commission <comptroller> shall
19-3 reimburse the Department of Public Safety for the actual costs of
19-4 an investigation.
19-5 (e) At least once every two years, the executive director
19-6 shall employ an independent firm that is experienced in security,
19-7 including computer security and systems security, to conduct a
19-8 comprehensive study of all aspects of lottery security, including:
19-9 (1) lottery personnel security;
19-10 (2) sales agent security;
19-11 (3) lottery operator and vendor security;
19-12 (4) security against ticket counterfeiting and
19-13 alteration and other means of fraudulent winning;
19-14 (5) security of lottery drawings;
19-15 (6) lottery computer, data communications, database,
19-16 and systems security;
19-17 (7) lottery premises and warehouse security;
19-18 (8) security of distribution of tickets;
19-19 (9) security of validation and payment procedures;
19-20 (10) security involving unclaimed prizes;
19-21 (11) security aspects of each lottery game;
19-22 (12) security against the deliberate placement of
19-23 winning tickets in lottery games that involve preprinted winning
19-24 tickets by persons involved in the production, storage,
19-25 transportation, or distribution of tickets; and
19-26 (13) other security aspects of lottery operations.
19-27 (f) The executive director shall provide the commission
20-1 <comptroller> with a complete report of the security study
20-2 conducted under Subsection (e) of this section. The commission
20-3 <comptroller> shall provide the governor and the legislature,
20-4 before the convening of each regular legislative session, with a
20-5 summary of the security study that shows the overall evaluation of
20-6 the lottery's security.
20-7 SECTION 12. Sections 2.13 and 2.14, State Lottery Act
20-8 (Article 179g, Vernon's Texas Civil Statutes), are amended to read
20-9 as follows:
20-10 Sec. 2.13. DEMOGRAPHIC STUDIES. (a) The executive director
20-11 shall, every two years, employ an independent firm experienced in
20-12 demographic analysis to conduct a demographic study of lottery
20-13 players. The study shall include the income, age, sex, race,
20-14 education, and frequency of participation of players.
20-15 (b) The executive director shall report the results of the
20-16 demographic study conducted under Subsection (a) of this section to
20-17 the commission <comptroller>, the governor, and the legislature
20-18 before the convening of each regular legislative session.
20-19 Sec. 2.14. Confidential Information. The following
20-20 information is confidential and is exempt from disclosure under the
20-21 open records law, Chapter 424, Acts of the 63rd Legislature,
20-22 Regular Session, 1973 (Article 6252-17a, Vernon's Texas Civil
20-23 Statutes):
20-24 (1) security plans and procedures of the commission
20-25 <division or the office of the comptroller> designed to ensure the
20-26 integrity and security of the operation of the lottery;
20-27 (2) information of a nature that is designed to ensure
21-1 the integrity and security of the selection of winning tickets or
21-2 numbers in the lottery, other than information describing the
21-3 general procedures for selecting winning tickets or numbers; and
21-4 (3) the street address and telephone number of a prize
21-5 winner, if the prize winner has not consented to the release of the
21-6 information.
21-7 SECTION 13. Section 2.15(b), State Lottery Act (Article
21-8 179g, Vernon's Texas Civil Statutes), is amended to read as
21-9 follows:
21-10 (b) An investigation report or other document submitted by
21-11 the Department of Public Safety to the commission <division>
21-12 becomes part of the investigative files of the commission
21-13 <division> and is subject to discovery by a person that is the
21-14 subject of the investigation report or other document.
21-15 SECTION 14. The State Lottery Act (Article 179g, Vernon's
21-16 Texas Civil Statutes) is amended by adding Article 2A to read as
21-17 follows:
21-18 ARTICLE 2A. STATE LOTTERY COMMISSION
21-19 Sec. 2A.01. MEMBERSHIP. (a) The State Lottery Commission
21-20 is composed of three members appointed by the governor with the
21-21 advice and consent of the senate.
21-22 (b) In making appointments to the commission, the governor
21-23 shall strive to achieve representation by all the population groups
21-24 of the state with regard to economic status, sex, race, and
21-25 ethnicity.
21-26 Sec. 2A.02. TERM OF OFFICE. Members hold office for
21-27 staggered terms of six years with one member's term expiring
22-1 February 1 of each odd-numbered year.
22-2 Sec. 2A.03. RESIDENCE REQUIREMENT. An individual is not
22-3 eligible to be a member of the commission unless the individual has
22-4 been a resident of this state for at least 10 consecutive years
22-5 immediately before appointment.
22-6 Sec. 2A.04. ELIGIBILITY. (a) An individual is not eligible
22-7 to be an appointed member of the commission if the individual:
22-8 (1) owns or controls, directly or indirectly, more
22-9 than a 10 percent interest in a business entity or other
22-10 organization regulated by the commission or receiving funds from
22-11 the commission;
22-12 (2) is employed by or participates in the management
22-13 of a business entity or other organization regulated by the
22-14 commission or receiving funds from the commission;
22-15 (3) uses or receives a substantial amount of tangible
22-16 goods, services, or funds from the commission, other than
22-17 compensation or reimbursement authorized by law for commission
22-18 membership, attendance, or expenses;
22-19 (4) is an officer, employee, or paid consultant of a
22-20 Texas trade association in the lottery business;
22-21 (5) is required to register as a lobbyist under
22-22 Chapter 305, Government Code, and its subsequent amendments because
22-23 of the person's activities for compensation on behalf of a
22-24 profession related to the operation of the commission;
22-25 (6) is married to an individual described by
22-26 Subdivisions (1)-(5);
22-27 (7) has been convicted of a felony or of any crime
23-1 involving moral turpitude; or
23-2 (8) is not a citizen of the United States.
23-3 (b) In this section, "Texas trade association" means a
23-4 nonprofit, cooperative, and voluntarily joined association of
23-5 business or professional competitors in this state designed to
23-6 assist its members and its industry or profession in dealing with
23-7 mutual business or professional problems and in promoting their
23-8 common interest.
23-9 Sec. 2A.05. PROHIBITED CONDUCT. (a) A commission member
23-10 may not:
23-11 (1) accept any employment or remuneration from a
23-12 person that has a significant financial interest in the lottery;
23-13 (2) play any lottery game conducted in this state;
23-14 (3) accept or be entitled to accept any part of the
23-15 winnings to be paid from a lottery game conducted in this state;
23-16 (4) use the member's official authority to affect the
23-17 result of an election or nomination for public office; or
23-18 (5) directly or indirectly coerce, attempt to coerce,
23-19 command, or advise a person to pay, lend, or contribute anything of
23-20 value to another person for political purposes.
23-21 (b) A commission member or former commission member or the
23-22 spouse of a commission member or former commission member may not
23-23 solicit or accept employment from a person regulated by the
23-24 commission before the second anniversary of the date on which the
23-25 commission member's service on the commission ends.
23-26 (c) In this section, "person that has a significant
23-27 financial interest in the lottery" has the meaning assigned by
24-1 Section 4.06 of this Act.
24-2 Sec. 2A.06. REMOVAL OF COMMISSION MEMBER. (a) The governor
24-3 may remove a commission member if the member:
24-4 (1) does not have at the time of appointment the
24-5 qualifications required for appointment to the commission;
24-6 (2) does not maintain during service on the commission
24-7 the qualifications required for appointment to the commission;
24-8 (3) violates a prohibition established by Section
24-9 2A.05 of this Act;
24-10 (4) cannot discharge the member's duties for a
24-11 substantial part of the term for which the member is appointed
24-12 because of illness or disability; or
24-13 (5) is absent from more than half of the regularly
24-14 scheduled commission meetings that the member is eligible to attend
24-15 during a calendar year unless the absence is excused by majority
24-16 vote of the commission.
24-17 (b) The validity of an action of the commission is not
24-18 affected by the fact that it is taken when a ground for removal of
24-19 a commission member exists.
24-20 (c) If the presiding officer has knowledge that a potential
24-21 ground for removal exists, the presiding officer shall notify the
24-22 governor.
24-23 Sec. 2A.07. COMPENSATION AND EXPENSES. (a) A commission
24-24 member is not entitled to compensation for serving on the
24-25 commission.
24-26 (b) A commission member is entitled to reimbursement for
24-27 actual and necessary expenses incurred in performing the member's
25-1 duties, subject to any applicable limitation in the General
25-2 Appropriations Act.
25-3 Sec. 2A.08. OFFICES. The commission shall maintain its
25-4 general office in the city of Austin. The commission may also
25-5 establish branch offices.
25-6 Sec. 2A.09. PRESIDING OFFICER. The governor shall designate
25-7 one member of the commission as presiding officer of the commission
25-8 to serve in that capacity at the pleasure of the governor.
25-9 Sec. 2A.10. MEETINGS. The commission shall hold at least
25-10 six regular meetings each year on dates fixed by the commission.
25-11 The commission may meet at other times at the call of the presiding
25-12 officer or as provided by commission rule.
25-13 Sec. 2A.11. POWERS AND DUTIES OF COMMISSION. The commission
25-14 shall:
25-15 (1) oversee the executive director's administration of
25-16 this Act;
25-17 (2) approve the operating budget of the commission and
25-18 the commission's request for appropriations; and
25-19 (3) appoint the members of any advisory committees to
25-20 the commission.
25-21 SECTION 15. Sections 3.01(a)-(c), (f), and (g), State
25-22 Lottery Act (Article 179g, Vernon's Texas Civil Statutes), are
25-23 amended to read as follows:
25-24 (a) The executive director shall attempt to license minority
25-25 businesses as sales agents in at least 20 percent of the licenses
25-26 issued. Implementation of this subsection must be consistent with
25-27 the rest of this section.
26-1 (b) The executive director may license as a sales agent each
26-2 person the executive director believes will best serve the public
26-3 convenience. The executive director may not issue a license to a
26-4 person to engage in business exclusively as a sales agent. A
26-5 license may not be transferred or assigned to any other person or
26-6 location.
26-7 (c) An applicant for a license under this section must apply
26-8 to the commission <division> under rules prescribed by the
26-9 commission <comptroller>, provide information necessary to
26-10 determine the applicant's eligibility for a license under Section
26-11 3.02 of this Act, and provide other information considered
26-12 necessary by the executive director <comptroller>. The applicant
26-13 must include an application fee with each application. The
26-14 executive director shall set the application fee in an amount that
26-15 is at least sufficient to cover the costs incurred by the
26-16 commission <division> and by the Department of Public Safety to
26-17 process the application. The executive director shall determine
26-18 from information provided by the Department of Public Safety the
26-19 amount required for costs incurred by the department and shall
26-20 allocate those amounts to the department at least monthly. If the
26-21 executive director denies an application for a license based on a
26-22 factor listed in Subsection (f) of this section, the executive
26-23 director shall refund one-half of the application fee to the
26-24 applicant. If the executive director denies an application based
26-25 on another factor, the executive director may not refund any part
26-26 of the application fee. Applications for licenses must be
26-27 available for public inspection during regular office hours.
27-1 (f) The commission <comptroller> shall adopt rules under
27-2 which, before issuing a license to an applicant, the executive
27-3 director shall consider:
27-4 (1) the financial responsibility and security of the
27-5 applicant and the business or activity in which the applicant is
27-6 engaged;
27-7 (2) the public accessibility of the applicant's place
27-8 of business or activity;
27-9 (3) the sufficiency of existing sales agents to serve
27-10 the public convenience;
27-11 (4) whether individuals under 18 years of age
27-12 constitute a majority of the applicant's customers or as customers
27-13 provide a majority of the applicant's sales volume;
27-14 (5) the volume of expected sales; and
27-15 (6) any other factor that the executive director
27-16 considers appropriate.
27-17 (g) The executive director may issue a license to a person
27-18 only if the executive director finds that the person's experience,
27-19 character, and general fitness are such that the person's
27-20 participation as a sales agent will not detract from the integrity,
27-21 security, honesty, and fairness of the operation of the lottery.
27-22 SECTION 16. Sections 3.02(a)-(d) and (f)-(i), State Lottery
27-23 Act (Article 179g, Vernon's Texas Civil Statutes), are amended to
27-24 read as follows:
27-25 (a) After a hearing, the executive director shall deny an
27-26 application for a license or the commission <comptroller> shall
27-27 suspend or revoke a license if the executive director or commission
28-1 <comptroller>, as applicable, finds that the applicant or sales
28-2 agent:
28-3 (1) is an individual who:
28-4 (A) has been convicted of a felony, criminal
28-5 fraud, gambling or a gambling-related offense, or a misdemeanor
28-6 involving moral turpitude, if less than 10 years has elapsed since
28-7 the termination of the sentence, parole, mandatory supervision, or
28-8 probation served for the offense;
28-9 (B) is or has been a professional gambler; <or>
28-10 (C) is married to <or related in the first
28-11 degree of consanguinity or affinity to> an individual:
28-12 (i) described in Paragraph (A) or (B) of
28-13 this subdivision; or
28-14 (ii) who is currently delinquent in the
28-15 payment of any state tax; or
28-16 (D) is an officer or employee of the commission
28-17 or a lottery operator; or
28-18 (E) is a spouse, child, brother, sister, or
28-19 parent residing as a member of the same household in the principal
28-20 place of residence of a person described by Paragraph (D) of this
28-21 subdivision;
28-22 (2) is not an individual, and an individual described
28-23 in Subdivision (1) of this subsection:
28-24 (A) is an officer or director of the applicant
28-25 or sales agent;
28-26 (B) holds more than 10 percent of the stock in
28-27 the applicant or sales agent;
29-1 (C) holds an equitable interest greater than 10
29-2 percent in the applicant or sales agent;
29-3 (D) is a creditor of the applicant or sales
29-4 agent who holds more than 10 percent of the applicant's or sales
29-5 agent's outstanding debt;
29-6 (E) is the owner or lessee of a business that
29-7 the applicant or sales agent conducts or through which the
29-8 applicant will conduct a ticket sales agency;
29-9 (F) shares or will share in the profits, other
29-10 than stock dividends, of the applicant or sales agent; or
29-11 (G) participates in managing the affairs of the
29-12 applicant or sales agent; <or>
29-13 <(H) is an employee of the applicant or sales
29-14 agent who is or will be involved in:>
29-15 <(i) selling tickets; or>
29-16 <(ii) handling money from the sale of
29-17 tickets;>
29-18 (3) is currently delinquent in the payment of any
29-19 state tax;
29-20 (4) is a person whose location for the sales agency
29-21 is:
29-22 (A) a racetrack at which wagering is authorized
29-23 under the Texas Racing Act (Article 179e, Vernon's Texas Civil
29-24 Statutes); or
29-25 (B) a location licensed for games of bingo under
29-26 the Bingo Enabling Act (Article 179d, Vernon's Texas Civil
29-27 Statutes); or
30-1 <(C) on land that is owned by:>
30-2 <(i) this state; or>
30-3 <(ii) a political subdivision of this
30-4 state, other than land used as a mass transportation facility that
30-5 is used by commercial carriers; or>
30-6 <(D) a location for which a person holds a wine
30-7 and beer retailer's permit, mixed beverage permit, mixed beverage
30-8 late hours permit, private club registration permit, or private
30-9 club late hours permit issued under Chapter 25, 28, 29, 32, or 33,
30-10 Alcoholic Beverage Code;>
30-11 (5) has violated this Act or a rule adopted under this
30-12 Act.
30-13 (b) Except as provided by Subsection (c) of this section, an
30-14 applicant or sales agent shall notify the executive director of any
30-15 change in the information in the applicant's or sales agent's most
30-16 recent application for a license or renewal of a license. The
30-17 applicant or sales agent shall notify the executive director of the
30-18 change in the information not later than the 10th day after the
30-19 date of the change.
30-20 (c) A corporate applicant or sales agent is not required to
30-21 notify the executive director under Subsection (b) of this section
30-22 of a transfer of less than 10 percent of the corporate stock unless
30-23 the transfer results in a shareholder who previously held 10
30-24 percent or less of the stock holding more than 10 percent of the
30-25 stock.
30-26 (d) If the executive director proposes to deny an
30-27 application for a license or the commission <comptroller> proposes
31-1 to suspend or revoke a license under this section, the applicant or
31-2 sales agent is entitled to written notice of the time and place of
31-3 the hearing. A notice may be served on an applicant or sales agent
31-4 personally or sent by certified or registered mail, return receipt
31-5 requested, to the person's mailing address as it appears on the
31-6 commission's <division's> records. A notice must be served or
31-7 mailed not later than the 20th day before the date of the hearing.
31-8 (f) The Administrative Procedure and Texas Register Act
31-9 (Article 6252-13a, Vernon's Texas Civil Statutes) applies to a
31-10 hearing under this section. An administrative law judge of the
31-11 State Office of Administrative Hearings shall conduct the hearing
31-12 as provided by Chapter 591, Acts of the 72nd Legislature, Regular
31-13 Session, 1991 (Article 6252-13f, Vernon's Texas Civil Statutes).
31-14 The commission may review the decision of an administrative law
31-15 judge as provided by the Administrative Procedure and Texas
31-16 Register Act (Article 6252-13a, Vernon's Texas Civil Statutes).
31-17 (g) The executive director shall give an applicant or sales
31-18 agent written notice of a denial of an application or a suspension
31-19 or revocation of a license.
31-20 (h) The executive director may not issue a license to a
31-21 person who has previously had a license under this Act revoked
31-22 unless the executive director is satisfied the person will comply
31-23 with this Act and the rules adopted under this Act. The executive
31-24 director may prescribe the terms under which a suspended license
31-25 will be reissued.
31-26 (i) The executive director shall not issue a license to sell
31-27 lottery tickets to applicants who fail to certify to the executive
32-1 director the applicant's compliance with the federal Americans With
32-2 Disabilities Act.
32-3 SECTION 17. Section 3.03, State Lottery Act (Article 179g,
32-4 Vernon's Texas Civil Statutes), is amended to read as follows:
32-5 Sec. 3.03. Summary Suspension of License. (a) The
32-6 commission <comptroller> may suspend a sales agent's license
32-7 summarily without notice or hearing if the commission <comptroller>
32-8 finds that the action is necessary to maintain the integrity,
32-9 security, honesty, or fairness of the operation or administration
32-10 of the lottery or to prevent financial loss to the state and:
32-11 (1) the sales agent fails to deposit money received
32-12 from ticket sales under Section 5.01 of this Act;
32-13 (2) an event occurs that would render the sales agent
32-14 ineligible for a license under Section 3.02 of this Act;
32-15 (3) the sales agent refuses to permit the executive
32-16 director, the commission <comptroller>, or the state auditor to
32-17 examine the agent's books, records, papers, or other objects under
32-18 Section 2.02(h) <2.02(j)> of this Act; or
32-19 (4) the executive director learns the sales agent has
32-20 failed to disclose information that would, if disclosed, render the
32-21 sales agent ineligible for a license under Section 3.02 of this
32-22 Act.
32-23 (b) The commission <comptroller> may summarily suspend a
32-24 sales agent's license if proceedings for a preliminary hearing
32-25 before an administrative law judge of the State Office of
32-26 Administrative Hearings <the comptroller or the comptroller's
32-27 representative> are initiated simultaneously with the summary
33-1 suspension. The preliminary hearing shall be set for a date not
33-2 later than 10 days after the date of the summary suspension, unless
33-3 the parties agree to a later date.
33-4 (c) At the preliminary hearing, the sales agent must show
33-5 cause why the license should not remain suspended pending a final
33-6 hearing on suspension or revocation. The Administrative Procedure
33-7 and Texas Register Act (Article 6252-13a, Vernon's Texas Civil
33-8 Statutes) does not apply <to the comptroller> in the administration
33-9 and enforcement of the summary suspension of a license under this
33-10 section. The rules governing a hearing on any other license
33-11 suspension or revocation under this Act govern a final
33-12 administrative hearing under this subsection.
33-13 (d) To initiate a proceeding to summarily suspend a sales
33-14 agent's license, the commission <comptroller> must serve notice to
33-15 the sales agent informing the agent of the right to a preliminary
33-16 hearing <before the comptroller or the comptroller's
33-17 representative> and of the time and place of the preliminary
33-18 hearing. The notice must be personally served on the sales agent
33-19 or an officer, employee, or agent of the sales agent or sent by
33-20 certified or registered mail, return receipt requested, to the
33-21 sales agent's mailing address as it appears on the commission's
33-22 <division's> records. The notice must state the alleged violations
33-23 that constitute grounds for summary suspension. The suspension is
33-24 effective at the time the notice is served. If notice is served in
33-25 person, the sales agent shall immediately surrender the license to
33-26 the commission <comptroller or to the comptroller's
33-27 representative>. If notice is served by mail, the sales agent
34-1 shall immediately return the license to the commission
34-2 <comptroller>. If the sales agent uses an on-line electronic
34-3 terminal to sell tickets, the executive director or a lottery
34-4 operator on the instructions of the executive director may
34-5 terminate the connection of the terminal to the commission's
34-6 <division's> lottery computer at the time:
34-7 (1) the proceeding to summarily suspend the license is
34-8 initiated; or
34-9 (2) the division discovers the sales agent has failed
34-10 to deposit money received from ticket sales, if the sales agent's
34-11 license is being summarily suspended under Subsection (a)(1) of
34-12 this section.
34-13 SECTION 18. Section 3.05(b), State Lottery Act (Article
34-14 179g, Vernon's Texas Civil Statutes), is amended to read as
34-15 follows:
34-16 (b) If a license expires under Subsection (a) of this
34-17 section and the sales agent's successor in interest desires to
34-18 operate the sales agency, the successor shall file an application
34-19 for an extended license not later than the 30th day after the date
34-20 the license expired. The application must state the basis for the
34-21 applicant's claim to be the successor in interest to the sales
34-22 agent and must contain a certification that the applicant would be
34-23 eligible for a license under Section 3.02 of this Act. The
34-24 executive director shall permit a qualified applicant to operate
34-25 under an extended license for not more than one year or until a new
34-26 license is issued to the applicant, whichever occurs first.
34-27 SECTION 19. Section 3.06, State Lottery Act (Article 179g,
35-1 Vernon's Texas Civil Statutes), is amended to read as follows:
35-2 Sec. 3.06. ACCESS TO CRIMINAL HISTORY AND FEDERAL TAX
35-3 INFORMATION. (a) The commission <comptroller> is entitled to
35-4 conduct an investigation of and is entitled to obtain criminal
35-5 history record information maintained by the Department of Public
35-6 Safety, the Federal Bureau of Investigation Identification
35-7 Division, or another law enforcement agency to assist in the
35-8 investigation of:
35-9 (1) a sales agent or an applicant for a sales agent
35-10 license;
35-11 (2) a person required to be named in a license
35-12 application;
35-13 (3) a lottery operator or prospective lottery
35-14 operator;
35-15 (4) an employee of a lottery operator or prospective
35-16 lottery operator, if the employee is or will be directly involved
35-17 in lottery operations;
35-18 (5) a person who manufactures or distributes lottery
35-19 equipment or supplies, or a representative of a person who
35-20 manufactures or distributes lottery equipment or supplies offered
35-21 to the lottery;
35-22 (6) a person who has submitted a written bid or
35-23 proposal to the commission <division> in connection with the
35-24 procurement of goods or services by the commission <division>, if
35-25 the amount of the bid or proposal exceeds $500;
35-26 (7) an employee or other person who works for or will
35-27 work for a sales agent or an applicant for a sales agent license;
36-1 (8) a person who proposes to enter into or who has a
36-2 contract with the commission <division> to supply goods or services
36-3 to the commission <division>; or
36-4 (9) if a person described in Subdivisions (1) through
36-5 (8) of this subsection is not an individual, an individual who:
36-6 (A) is an officer or director of the person;
36-7 (B) holds more than 10 percent of the stock in
36-8 the person;
36-9 (C) holds an equitable interest greater than 10
36-10 percent in the person;
36-11 (D) is a creditor of the person who holds more
36-12 than 10 percent of the person's outstanding debt;
36-13 (E) is the owner or lessee of a business that
36-14 the person conducts or through which the person will conduct
36-15 lottery-related activities;
36-16 (F) shares or will share in the profits, other
36-17 than stock dividends, of the person;
36-18 (G) participates in managing the affairs of the
36-19 person; or
36-20 (H) is an employee of the person who is or will
36-21 be involved in:
36-22 (i) selling tickets; or
36-23 (ii) handling money from the sale of
36-24 tickets.
36-25 (b) The commission <comptroller> shall conduct an
36-26 investigation of and obtain criminal history record information
36-27 maintained by the Department of Public Safety, the Federal Bureau
37-1 of Investigation Identification Division, or another law
37-2 enforcement agency to assist in the investigation of<:>
37-3 <(1) the director or a prospective director of the
37-4 division; or>
37-5 <(2)> an employee or prospective employee of the
37-6 commission <division>.
37-7 (c) Not later than one year after the date of each renewal,
37-8 the commission <comptroller> shall obtain criminal history record
37-9 information maintained by the Department of Public Safety on a
37-10 sales agent whose license is renewed under Section 3.01(h) of this
37-11 Act.
37-12 (d) The executive director may discharge from employment an
37-13 employee of the commission <division> who fails to provide a
37-14 complete legible set of fingerprints on request. The executive
37-15 director may refuse to consider a prospective employee of the
37-16 commission <division> who fails to provide a complete legible set
37-17 of fingerprints on request.
37-18 (e) The executive director may deny an application for a
37-19 license or the commission <comptroller> may suspend or revoke a
37-20 license if the applicant or sales agent fails on request to provide
37-21 a complete legible set of fingerprints of<:>
37-22 <(1)> a person required to be named in a license
37-23 application<; or>
37-24 <(2) an employee or other person who works or will
37-25 work for the applicant or sales agent, if the person:>
37-26 <(A) is or will be involved in the sale of
37-27 tickets; or>
38-1 <(B) handles or will handle money from the sale
38-2 of tickets>.
38-3 (f) All criminal history record information received by the
38-4 executive director is privileged information and is for the
38-5 exclusive use of the executive director and employees of the
38-6 commission <division> designated by the executive director. Except
38-7 on court order or as provided by Subsection (h) of this section,
38-8 the information may not be released or otherwise disclosed to any
38-9 other person or agency.
38-10 (g) All information received by the executive director from
38-11 the Internal Revenue Service is confidential and may only be used
38-12 as provided by the contract between the comptroller and the
38-13 Internal Revenue Service under which the information was obtained.
38-14 (h) The executive director or an employee of the commission
38-15 <division> may not provide any person being investigated under this
38-16 section with a copy of the person's criminal history record
38-17 obtained from the Department of Public Safety, the Federal Bureau
38-18 of Investigation Identification Division, or another law
38-19 enforcement agency. This subsection does not prevent the executive
38-20 director from disclosing to the person the dates and places of
38-21 arrests, offenses, and dispositions contained in the criminal
38-22 history records.
38-23 (i) A person commits an offense if the person releases or
38-24 discloses information received by the commission <comptroller>
38-25 under this section except on court order or as provided by
38-26 Subsection (h) of this section. An offense under this subsection
38-27 is a Class A misdemeanor.
39-1 (j) The executive director may request the cooperation of
39-2 the Department of Public Safety to perform a background
39-3 investigation of a person listed in Subsection (a) or (b) of this
39-4 section. The executive director shall reimburse the Department of
39-5 Public Safety for the actual cost of an investigation. The
39-6 executive director may require a person who is subject to
39-7 investigation to pay all costs of the investigation and to provide
39-8 any information, including fingerprints, necessary to carry out the
39-9 investigation or facilitate access to state or federal criminal
39-10 history record information. Payments made to the executive
39-11 director under this subsection shall be deposited in the general
39-12 revenue fund and may be used to reimburse the Department of Public
39-13 Safety for the actual costs of an investigation.
39-14 (k) Unless otherwise prohibited by law, the Department of
39-15 Public Safety may retain any record or information submitted to it
39-16 under this section. The Department of Public Safety shall notify
39-17 the executive director of any change in information provided to the
39-18 executive director when the Department of Public Safety learns of
39-19 the change.
39-20 (l) The commission shall adopt rules governing the custody
39-21 and use of criminal history record information obtained under this
39-22 section. The comptroller shall adopt necessary rules governing the
39-23 custody and use of information obtained from the Internal Revenue
39-24 Service under this section.
39-25 (m) The executive director may obtain information relating
39-26 to a person's qualification for licensing, employment, or
39-27 contracting under this Act from the Internal Revenue Service under
40-1 a contract between the comptroller and the Internal Revenue Service
40-2 on:
40-3 (1) a sales agent or an applicant for a sales agent
40-4 license;
40-5 (2) an employee or prospective employee of the
40-6 commission <division>;
40-7 (3) a person required to be named in a license
40-8 application;
40-9 (4) a lottery operator or prospective lottery
40-10 operator;
40-11 (5) an employee of a lottery operator or prospective
40-12 lottery operator, if the employee is or will be directly involved
40-13 in lottery operations;
40-14 (6) a person who manufactures or distributes lottery
40-15 equipment or supplies, or a representative of a person who
40-16 manufactures or distributes lottery equipment or supplies offered
40-17 to the lottery;
40-18 (7) a person who has submitted a written bid or
40-19 proposal to the commission <division> in connection with the
40-20 procurement of goods or services by the commission <division>;
40-21 (8) an employee or other person who works for or will
40-22 work for a sales agent or an applicant for a sales agent license;
40-23 or
40-24 (9) a person who proposes to enter into or who has a
40-25 contract with the commission <division> to supply goods or services
40-26 to the commission <division>.
40-27 (n) The executive director may award a contract for lottery
41-1 supplies or services, including a contract under Section 2.02(g) of
41-2 this Act, pending the completion of any investigation authorized by
41-3 this Act. A contract awarded under this subsection must include a
41-4 provision permitting the executive director to terminate the
41-5 contract without penalty if the investigation reveals that the
41-6 person to whom the contract is awarded would not be eligible for a
41-7 sales agent license under Section 3.02 of this Act. <The
41-8 director's authority to award a contract under this subsection
41-9 expires September 1, 1993. This subsection expires January 1,
41-10 1995.>
41-11 (o) The governor shall conduct an investigation of and
41-12 obtain criminal history record information maintained by the
41-13 Department of Public Safety, the Federal Bureau of Investigation
41-14 identification division, or another law enforcement agency to
41-15 assist in the investigation of the executive director or a
41-16 prospective executive director <The comptroller shall obtain
41-17 criminal history record information maintained by the Department of
41-18 Public Safety on any person receiving a temporary license under
41-19 Section 3.04 of this Act not later than one year after the date of
41-20 issuance of the temporary license. This subsection expires
41-21 September 1, 1993>.
41-22 (p) All fingerprints submitted to the Department of Public
41-23 Safety must be on a form prescribed by the Department of Public
41-24 Safety.
41-25 SECTION 20. Section 4.01, State Lottery Act (Article 179g,
41-26 Vernon's Texas Civil Statutes), is amended to read as follows:
41-27 Sec. 4.01. Tickets. (a) The executive director shall
42-1 prescribe the form of tickets. The toll-free "800" telephone
42-2 number established by the Texas Commission on Alcohol and Drug
42-3 Abuse under Section 461.018, Health and Safety Code, must be
42-4 printed on each ticket. The overall estimated odds of winning a
42-5 prize in a given game or activity must be printed on each ticket
42-6 and prominently displayed in association with the sale of lottery
42-7 products. The estimate must be based on reasonable projections and
42-8 past experience.
42-9 (b) By purchasing a ticket in a particular lottery game or
42-10 activity, a player agrees to abide by and be bound by the
42-11 commission's <division's> rules, including the rules applicable to
42-12 the particular lottery game or activity involved. The player also
42-13 acknowledges that the determination of whether the player is a
42-14 valid winner is subject to the commission's <division's> rules and
42-15 claims procedures, including those developed for the particular
42-16 lottery game or activity involved, and subject to any validation
42-17 tests established by the commission <division> for the particular
42-18 lottery game or activity involved. If the lottery uses tickets, an
42-19 abbreviated form of the rules or a reference to the rules may
42-20 appear on the tickets.
42-21 (c) A person claiming or attempting to claim a lottery prize
42-22 or a share of a lottery prize represents that the ticket or other
42-23 item showing that the person is entitled to the prize or share was
42-24 lawfully obtained, is not stolen, forged, or altered, and has not
42-25 previously been redeemed.
42-26 SECTION 21. Section 4.02, State Lottery Act (Article 179g,
42-27 Vernon's Texas Civil Statutes), is amended to read as follows:
43-1 Sec. 4.02. Certain Sales of Tickets Prohibited. (a) A
43-2 person commits an offense if the person intentionally or knowingly
43-3 sells a ticket at a price the person knows is greater than that
43-4 fixed by the commission <division> or by the lottery operator
43-5 authorized to set that price. An offense under this subsection is
43-6 a Class A misdemeanor.
43-7 (b) Except as provided by this subsection, a person who is
43-8 not a sales agent or an employee of a sales agent commits an
43-9 offense if the person intentionally or knowingly sells a ticket.
43-10 An offense under this subsection is a felony of the third degree.
43-11 A lottery operator may sell tickets to a licensed sales agent. A
43-12 person who is not a sales agent may distribute tickets as premiums
43-13 to customers, employees, or other persons who deal with the person
43-14 if no purchase <or service> is required to entitle the recipient to
43-15 the ticket.
43-16 (c) A person commits an offense if the person sells a ticket
43-17 at a location other than the location of a sales agency. An
43-18 offense under this subsection is a Class A misdemeanor.
43-19 (d) A sales agent or an employee of a sales agent commits an
43-20 offense if the person <may not> intentionally or knowingly sells or
43-21 offers <sell or offer> to sell a ticket to an individual that the
43-22 person knows is younger than 18 years of age. An offense under
43-23 this subsection is a Class C misdemeanor.
43-24 (e) A person may not purchase <sell> a ticket or claim,
43-25 collect, or receive <pay> a lottery prize or a share of a lottery
43-26 prize if <to another person that> the person <knows> is:
43-27 (1) a member, officer, or employee of a person that
44-1 has a contract with the commission <division> to sell or lease
44-2 goods or services used in the lottery;
44-3 (2) a member, officer, or employee of a lottery
44-4 operator;
44-5 (3) an officer or employee of the commission
44-6 <comptroller>; or
44-7 (4) a spouse, child, brother, sister, or parent
44-8 residing as a member of the same household in the principal place
44-9 of residence of a person described by Subdivision (1), (2), or (3)
44-10 of this subsection.
44-11 (f) A person 18 years of age or older may purchase a ticket
44-12 to give as a gift to another person, including an individual
44-13 younger than 18 years of age.
44-14 (g) If an individual listed in Subsection (e) of this
44-15 section purchases a ticket or claims or otherwise attempts to
44-16 collect or receive a lottery prize or a share of a lottery prize or
44-17 an individual younger than 18 years of age directly purchases a
44-18 ticket, the individual is not eligible to receive a prize or share
44-19 of a prize, and the prize or share of a prize otherwise payable on
44-20 the ticket is treated as an unclaimed prize as provided by Section
44-21 5.05 of this Act.
44-22 (h) <(g)> A sales agent or an employee of a sales agent
44-23 commits an offense if the person intentionally or knowingly sells a
44-24 ticket to another person by extending credit or lending money to
44-25 the person to enable the person to purchase the ticket. An offense
44-26 under this subsection is a Class C misdemeanor.
44-27 (i) <(h)> A person commits an offense if the person
45-1 intentionally or knowingly sells <may not purchase> a ticket and:
45-2 (1) accepts <with> a food stamp coupon issued under
45-3 the food stamp program administered under Chapter 33, Human
45-4 Resources Code, as payment;
45-5 (2) accepts <with> a credit card or a debit card as a
45-6 source of payment;
45-7 (3) the sale is made over the telephone; or
45-8 (4) the sale is made by mail-order sales.
45-9 (j) <(i)> A person commits an offense if the person
45-10 intentionally or knowingly purchases <may not pay> for a ticket
45-11 with:
45-12 (1) a food stamp coupon issued under the food stamp
45-13 program administered under Chapter 33, Human Resources Code; or
45-14 (2) the proceeds of a check issued as a payment under
45-15 the Aid to Families with Dependent Children program administered
45-16 under Chapter 31, Human Resources Code.
45-17 (k) An offense under Subsection (i) or (j) of this section
45-18 is a Class C misdemeanor.
45-19 (l) A person commits an offense if, for financial gain, the
45-20 person establishes or promotes a group purchase or pooling
45-21 arrangement under which tickets are purchased on behalf of the
45-22 group or pool and any prize is divided among the members of the
45-23 group or pool, and the person intentionally or knowingly:
45-24 (1) uses any part of the funds solicited or accepted
45-25 for a purpose other than purchasing tickets on behalf of the group
45-26 or pool; or
45-27 (2) retains a share of any prize awarded as
46-1 compensation for establishing or promoting the group purchase or
46-2 pooling arrangement.
46-3 (m) An offense under Subsection (l) of this section is a
46-4 felony of the third degree.
46-5 SECTION 22. Section 4.03, State Lottery Act (Article 179g,
46-6 Vernon's Texas Civil Statutes), is amended by amending Subsection
46-7 (d) and adding Subsection (h) to read as follows:
46-8 (d) An offense under Subsection (c) of this section is a
46-9 Class A misdemeanor unless it is shown on the trial of the offense
46-10 that:
46-11 (1) the amount claimed <or attempted to be claimed> is
46-12 greater than $200 but not more than $10,000, in which event the
46-13 offense is a felony of the third degree;
46-14 (2) the amount claimed <or attempted to be claimed> is
46-15 greater than $10,000, in which event the offense is a felony of the
46-16 second degree; or
46-17 (3) the person has previously been convicted of an
46-18 offense under this section, in which event the offense is a felony
46-19 of the third degree, unless the offense is designated as a felony
46-20 of the second degree under Subdivision (2) of this subsection.
46-21 (h) In this section, "claim" includes an attempt to claim,
46-22 without regard to whether the attempt is successful.
46-23 SECTION 23. Section 4.04(b), State Lottery Act (Article
46-24 179g, Vernon's Texas Civil Statutes), is amended to read as
46-25 follows:
46-26 (b) A person commits an offense if the person knowingly
46-27 refuses to produce for inspection by the executive director,
47-1 commission <comptroller>, or state auditor a book, record, or
47-2 document required to be maintained or made by this Act or a rule
47-3 adopted under this Act.
47-4 SECTION 24. Section 4.045(a), State Lottery Act (Article
47-5 179g, Vernon's Texas Civil Statutes), is amended to read as
47-6 follows:
47-7 (a) A person commits an offense if the person intentionally
47-8 or<,> knowingly<, recklessly, or with criminal negligence> makes a
47-9 material and false, incorrect, or deceptive statement to a person
47-10 conducting an investigation or exercising discretion under this Act
47-11 or a rule adopted under this Act.
47-12 SECTION 25. Sections 4.06(a)-(e), State Lottery Act (Article
47-13 179g, Vernon's Texas Civil Statutes), are amended to read as
47-14 follows:
47-15 (a) A commission member <The comptroller, the state
47-16 treasurer>, the executive director, or an employee of the
47-17 commission <division> may not knowingly accept a gift or political
47-18 contribution from:
47-19 (1) a person that has a significant financial interest
47-20 in the lottery;
47-21 (2) a person related in the first degree of
47-22 consanguinity or affinity to a person that has a significant
47-23 financial interest in the lottery;
47-24 (3) a person that owns more than a 10 percent interest
47-25 in an entity that has a significant financial interest in the
47-26 lottery;
47-27 (4) a political committee that is directly
48-1 established, administered, or controlled, in whole or in part, by a
48-2 person that has a significant financial interest in the lottery; or
48-3 (5) a person who, within the two years preceding the
48-4 date of the gift or contribution, won a lottery prize exceeding
48-5 $600 in amount or value.
48-6 (b) A former commission member <comptroller, former state
48-7 treasurer,> or former executive director may not:
48-8 (1) for compensation, represent a person that has made
48-9 or intends to make a bid to operate the lottery before the
48-10 commission <comptroller> before the second anniversary of the date
48-11 that the person's service in office or employment with the
48-12 commission <division> ceases;
48-13 (2) represent any person or receive compensation for
48-14 services rendered on behalf of any person regarding a particular
48-15 matter in which the former officer or employee participated during
48-16 the period of service or employment with the commission <division>,
48-17 either through personal involvement or because the matter was
48-18 within the scope of the officer's or employee's official
48-19 responsibility; or
48-20 (3) for compensation, communicate directly with a
48-21 member of the legislative branch to influence legislation on behalf
48-22 of a person that has a significant financial interest in the
48-23 lottery, before the second anniversary of the date that the
48-24 person's service in office or employment with the commission
48-25 <division> ceases.
48-26 (c) A former commission member <comptroller, former state
48-27 treasurer>, former executive director, or former employee of the
49-1 commission <division> may not, before the second anniversary of the
49-2 date that the person's service in office or employment with the
49-3 commission <division> ceases, knowingly accept a gift or political
49-4 contribution from:
49-5 (1) a person that has a significant financial interest
49-6 in the lottery;
49-7 (2) a person related in the first degree of
49-8 consanguinity or affinity to a person that has a significant
49-9 financial interest in the lottery;
49-10 (3) a person that owns more than a 10 percent interest
49-11 in an entity that has a significant financial interest in the
49-12 lottery;
49-13 (4) a political committee that is directly
49-14 established, administered, or controlled, in whole or in part, by a
49-15 person that has a significant financial interest in the lottery; or
49-16 (5) a person who, within the two years preceding the
49-17 date of the gift or contribution, won a lottery prize exceeding
49-18 $600 in amount or value.
49-19 (d) A person may not knowingly make a gift or political
49-20 contribution to a commission member <the comptroller, the state
49-21 treasurer>, the executive director, or an employee of the
49-22 commission <division> if the person:
49-23 (1) has a significant financial interest in the
49-24 lottery;
49-25 (2) is related in the first degree of consanguinity or
49-26 affinity to a person that has a significant financial interest in
49-27 the lottery;
50-1 (3) owns more than a 10 percent interest in an entity
50-2 that has a significant financial interest in the lottery;
50-3 (4) is a political committee that is directly
50-4 established, administered, or controlled, in whole or in part, by a
50-5 person that has a significant financial interest in the lottery; or
50-6 (5) within the two years preceding the date of the
50-7 gift or contribution, won a lottery prize exceeding $600 in amount
50-8 or value.
50-9 (e) A person may not knowingly make a gift or political
50-10 contribution to a former commission member <comptroller, former
50-11 state treasurer>, former executive director, or former employee of
50-12 the commission <division> before the second anniversary of the date
50-13 that the person's service in office or employment with the
50-14 commission <division> ceases, if the person:
50-15 (1) has a significant financial interest in the
50-16 lottery;
50-17 (2) is related in the first degree of consanguinity or
50-18 affinity to a person that has a significant financial interest in
50-19 the lottery;
50-20 (3) owns more than a 10 percent interest in an entity
50-21 that has a significant financial interest in the lottery;
50-22 (4) is a political committee that is directly
50-23 established, administered, or controlled, in whole or in part, by a
50-24 person that has a significant financial interest in the lottery; or
50-25 (5) within the two years preceding the date of the
50-26 gift or contribution, won a lottery prize exceeding $600 in amount
50-27 or value.
51-1 SECTION 26. Article 4, State Lottery Act (Article 179g,
51-2 Vernon's Texas Civil Statutes), is amended by adding Section 4.07
51-3 to read as follows:
51-4 Sec. 4.07. AGGREGATION OF AMOUNTS INVOLVED. When amounts
51-5 are claimed, attempted to be claimed, or obtained in violation of
51-6 this Act pursuant to one scheme or continuing course of conduct,
51-7 whether from the same or several sources, the conduct may be
51-8 considered as one offense and the amounts aggregated in determining
51-9 the grade of the offense.
51-10 SECTION 27. Section 5.01, State Lottery Act (Article 179g,
51-11 Vernon's Texas Civil Statutes), is amended to read as follows:
51-12 Sec. 5.01. Delivery of Funds. (a) Except as provided by
51-13 Subsection (e) of this section, all revenue received from the sale
51-14 of tickets and all money credited to the state lottery account from
51-15 any other source shall be deposited in the state treasury through
51-16 approved state depositories on the settlement day or days
51-17 established by the executive director.
51-18 (b) The executive director may require sales agents to
51-19 establish separate electronic funds transfer accounts for the
51-20 purposes of depositing money from ticket sales, making payments to
51-21 the commission <division>, and receiving payments from the
51-22 commission <division>. The commission <comptroller> by rule shall
51-23 establish the procedures for depositing money from ticket sales
51-24 into electronic funds transfer accounts, as well as other
51-25 procedures regarding the handling of money from ticket sales. The
51-26 executive director may not permit a sales agent to make payments to
51-27 the commission <division> or a lottery operator in cash.
52-1 (c) The state treasurer, in consultation with the executive
52-2 director, shall establish procedures for the efficient
52-3 implementation and operation of an electronic funds transfer system
52-4 to meet the needs of the executive director under this Act.
52-5 (d) The executive director may require a sales agent to file
52-6 with the commission <division> reports of receipts and transactions
52-7 relating to the sale of tickets in the form and containing the
52-8 information that the executive director requires. Each sales agent
52-9 shall maintain records adequate to establish the disposition of
52-10 each ticket provided to the sales agent, the amounts of money
52-11 received for the sale of those tickets, and any prizes awarded by
52-12 the sales agent.
52-13 (e) The executive director may provide for a sales agent to
52-14 retain from the money received from the sale of tickets the amount
52-15 of prizes paid by the agent or the agent's commission, if any, and
52-16 may establish how often the agent will make settlement payments to
52-17 the treasury.
52-18 (f) The executive director may provide for a sales agent to
52-19 pay amounts received for the sale of tickets directly to an officer
52-20 or employee of the commission <division> for immediate deposit in
52-21 the state treasury.
52-22 (g) A sales agent is liable to the commission <division> for
52-23 all tickets accepted or generated by the sales agent or any
52-24 employee or agent of the sales agent, and tickets shall be deemed
52-25 to have been purchased by the sales agent unless returned to the
52-26 commission <division> within the time and manner prescribed by the
52-27 commission <division>. Money received by a sales agent from the
53-1 sales of tickets, less the amount retained for prizes paid by the
53-2 sales agent or for the agent's commission, if any, together with
53-3 any unsold tickets, shall be held in trust for the benefit of the
53-4 state before delivery to a lottery operator or the commission
53-5 <division> or electronic transfer to the state treasury, and the
53-6 sales agent is liable to the commission <division> for the full
53-7 amount of the money or unsold tickets so held. If the sales agent
53-8 is not an individual, each officer, director, or owner of the sales
53-9 agent is personally liable to the commission <division> for the
53-10 full amount of the money or unsold tickets held in trust for the
53-11 benefit of the state.
53-12 SECTION 28. Sections 5.02(b), (f), and (j), State Lottery
53-13 Act (Article 179g, Vernon's Texas Civil Statutes), are amended to
53-14 read as follows:
53-15 (b) Money in the state lottery account shall be used only
53-16 for the following purposes and shall be distributed as follows:
53-17 (1) the payment of prizes to the holders of winning
53-18 tickets;
53-19 (2) the payment of costs incurred in the operation and
53-20 administration of the lottery, including any fees received by a
53-21 lottery operator, provided that the costs incurred in a fiscal
53-22 biennium may not exceed an amount equal to 15 percent of the gross
53-23 revenue accruing from the sale of tickets in that biennium;
53-24 (3) the establishment of a pooled bond fund, lottery
53-25 prize reserve fund, unclaimed prize fund, and prize payment
53-26 account;
53-27 (4) the transfer of amounts to the state lottery
54-1 stabilization fund as provided by Subsections (c), (d), and (e) of
54-2 this section; and
54-3 (5) <(4)> the balance, after creation of a reserve
54-4 sufficient to pay the amounts needed or estimated to be needed
54-5 under <provided by> Subdivisions (1) through (3) <and (2)> of this
54-6 subsection, to be transferred to the unobligated portion of the
54-7 general revenue fund, on or before the 15th day of each month.
54-8 (f) The state treasurer periodically shall file reports with
54-9 the executive director providing information regarding the revenue
54-10 credited to the state lottery account, the investments of the money
54-11 in the account, and the distributions made from the account.
54-12 (j) Notwithstanding Subsection (b)(5) <(b)(4)> and
54-13 Subsection (d) of this section, the initial transfer of revenue
54-14 from the state lottery account to the unobligated portion of the
54-15 general revenue fund and the state lottery stabilization fund under
54-16 those subsections shall be made on the 15th day of the month
54-17 following the month in which the earlier of the following occurs:
54-18 (1) the first ticket is sold to a player under this
54-19 Act; or
54-20 (2) the executive director receives liquidated damages
54-21 or a payment under a performance bond under a contract with a
54-22 lottery operator.
54-23 SECTION 29. Section 5.02(h)(4), State Lottery Act (Article
54-24 179g, Vernon's Texas Civil Statutes), is amended to read as
54-25 follows:
54-26 (4) "Net lottery revenue" means the gross lottery
54-27 revenue minus the amounts distributed or obligated for a purpose
55-1 described by Subsections (b)(1) through (b)(3) <and (b)(2)> of this
55-2 section.
55-3 SECTION 30. Sections 5.03(c)-(f) and (h)-(l), State Lottery
55-4 Act (Article 179g, Vernon's Texas Civil Statutes), are amended to
55-5 read as follows:
55-6 (c) An employee of the commission <division> and the
55-7 independent certified public accountant witnessing the drawing
55-8 shall inspect any equipment used in the drawing. The equipment
55-9 must be inspected immediately before and after the drawing. The
55-10 drawing and inspections must be recorded on video and audio tape.
55-11 (d) The executive director may authorize prizes to be paid
55-12 by warrants to be drawn on the state lottery account. If the
55-13 executive director determines that prize money is to be paid in
55-14 installments, the state treasurer shall invest funds from the state
55-15 lottery account as necessary to ensure the payment of the
55-16 installments. The investments may be in securities, annuities, or
55-17 other instruments as determined by the treasurer.
55-18 (e) Payment of a prize in an amount of $600 or more shall be
55-19 made by the executive director.
55-20 (f) The executive director may authorize a sales agent to
55-21 pay a prize in an amount less than $600 after performing procedures
55-22 to validate the winning ticket as required by the executive
55-23 director. A prize paid under this subsection is not required to be
55-24 paid by warrant on the state lottery account.
55-25 (h) A specific prize as set forth by the prize structure of
55-26 a specific lottery game or activity may not be paid more than once.
55-27 If the executive director determines that more than one claimant
56-1 has been awarded a specific unpaid prize in a specific lottery game
56-2 or activity, each claimant is entitled only to an equal share of
56-3 the prize.
56-4 (i) The executive director shall pay the cash equivalent of
56-5 a prize other than prize money if more than one person is entitled
56-6 to share the prize as provided by Subsection (h) of this section.
56-7 (j) The executive director shall deduct the amount of a
56-8 delinquent tax or other money from the winnings of a person who has
56-9 been finally determined to be:
56-10 (1) delinquent in the payment of a tax or other money
56-11 collected by the comptroller, the state treasurer, or the Texas
56-12 Alcoholic Beverage Commission;
56-13 (2) delinquent in making child support payments
56-14 administered or collected by the attorney general; <or>
56-15 (3) in default on a loan made under Chapter 52,
56-16 Education Code; or
56-17 (4) in default on a loan guaranteed under Chapter 57,
56-18 Education Code.
56-19 (k) If a person's winnings exceed a delinquency under
56-20 Subsection (j) of this section, the executive director shall pay
56-21 the balance to the person. The executive director shall transfer
56-22 the amount deducted to the appropriate agency.
56-23 (l) The attorney general, comptroller, state treasurer,
56-24 Texas Alcoholic Beverage Commission, Texas Higher Education
56-25 Coordinating Board, and Texas Guaranteed Student Loan Corporation
56-26 shall each provide the executive director with a report of persons
56-27 who have been finally determined to be delinquent in the payment of
57-1 a tax or other money collected by the agency. The commission
57-2 <comptroller> shall adopt rules regarding the form and frequency of
57-3 reports under this subsection.
57-4 SECTION 31. Sections 5.04(a)-(c), State Lottery Act (Article
57-5 179g, Vernon's Texas Civil Statutes), are amended to read as
57-6 follows:
57-7 (a) If a minor is entitled to prize money on a winning
57-8 ticket in an amount less than $600, the executive director may make
57-9 payment by delivery to an adult member of the minor's family, or to
57-10 the minor's guardian, of a warrant payable to the order of the
57-11 minor.
57-12 (b) If a minor is entitled to prize money on a winning
57-13 ticket in an amount of $600 or more, the executive director may
57-14 direct payment to the minor by depositing the amount of the prize
57-15 in any bank to the credit of an adult member of the minor's family
57-16 or of the minor's guardian as custodian for the minor.
57-17 (c) The executive director shall pay the cash equivalent of
57-18 a prize other than prize money if the person entitled to claim the
57-19 prize is a minor. Payment of the cash equivalent of a prize other
57-20 than prize money to a minor shall be made as provided by
57-21 Subsections (a) and (b) of this section.
57-22 SECTION 32. Sections 5.05(a), (b), and (d), State Lottery
57-23 Act (Article 179g, Vernon's Texas Civil Statutes), are amended to
57-24 read as follows:
57-25 (a) The commission <division> shall retain an unclaimed
57-26 prize on a winning ticket for payment or delivery to the person
57-27 entitled to the prize for 180 days after the date on which the
58-1 winner was selected. If a claim is not made for prize money on or
58-2 before the 180th day after the date on which the winner was
58-3 selected, the prize money shall be used to provide additional money
58-4 to the state lottery account for the purposes prescribed by Section
58-5 5.02(b)(1) of this Act.
58-6 (b) If a claim is not made for a prize other than prize
58-7 money on or before the 180th day after the date on which the winner
58-8 was selected, the prize shall revert to the commission <division>
58-9 for use in subsequent games.
58-10 (d) For each lottery game, after the last date on which a
58-11 prize may be claimed under Subsection (c) of this section, the
58-12 executive director shall prepare a report that shows the total
58-13 number of tickets sold and the number and amounts of prizes awarded
58-14 in the game. The report must be available for public inspection.
58-15 SECTION 33. Sections 5.06(a) and (b), State Lottery Act
58-16 (Article 179g, Vernon's Texas Civil Statutes), are amended to read
58-17 as follows:
58-18 (a) The executive director and each lottery operator shall
58-19 determine the compensation to be paid to sales agents for the sale
58-20 of tickets as provided by this section. The compensation paid to a
58-21 sales agent may not be an amount less than five percent of the
58-22 retail price of the tickets sold plus, at the discretion of the
58-23 executive director or lottery operator supervising the game or
58-24 activity involved, an incentive bonus based on attainment of sales
58-25 volume, the redemption of winning tickets, or other objectives
58-26 specified by the executive director or lottery operator for each
58-27 type of lottery.
59-1 (b) The commission <division> or a lottery operator may run
59-2 sales agent incentive games for sales agents using the incentive
59-3 bonus amount or other amounts allocated by the executive director
59-4 as compensation for sales agents.
59-5 SECTION 34. Section 47.06(g), Penal Code, is amended to read
59-6 as follows:
59-7 (g) It is a defense to prosecution for an offense under this
59-8 section <chapter> that the conduct was authorized, directly or
59-9 indirectly, by the State Lottery Act, the Texas Lottery Commission
59-10 <lottery division in the office of the comptroller, the
59-11 comptroller>, or the executive director of the Texas Lottery
59-12 Commission <lottery division>.
59-13 SECTION 35. Section 47.14, Penal Code, is amended to read as
59-14 follows:
59-15 Sec. 47.14. State Lottery. It is a defense to prosecution
59-16 for an offense under this chapter that the conduct:
59-17 (1) consisted entirely of participation in the state
59-18 lottery authorized by the State Lottery Act; or
59-19 (2) was a necessary incident to the operation of the
59-20 state lottery and was authorized, directly or indirectly, by the
59-21 State Lottery Act<, the lottery division in the office of the
59-22 comptroller>, the Texas Lottery Commission <comptroller>, or the
59-23 executive director of the Texas Lottery Commission <lottery
59-24 division>.
59-25 SECTION 36. Section 111.0047(a), Tax Code, is amended to
59-26 read as follows:
59-27 (a) If a person fails to comply with any provision of this
60-1 title<, with any provision of the State Lottery Act,> or with a
60-2 rule of the comptroller adopted under this title <or the State
60-3 Lottery Act>, the comptroller, after a hearing, may revoke or
60-4 suspend any permit or license issued to the person.
60-5 SECTION 37. Section 111.0048(a), Tax Code, is amended to
60-6 read as follows:
60-7 (a) A new permit or license may not be issued to a former
60-8 holder of a revoked permit or license unless the comptroller is
60-9 satisfied that the person will comply with the provisions of this
60-10 title <and the State Lottery Act> and the rules of the comptroller
60-11 relating to this title <and the State Lottery Act>.
60-12 SECTION 38. Section 2(5)(A), Chapter 421, Acts of the 63rd
60-13 Legislature, Regular Session, 1973 (Article 6252-9b, Vernon's Texas
60-14 Civil Statutes), is amended to read as follows:
60-15 (A) "Appointed officer of a major state agency"
60-16 means any of the following:
60-17 (i) a member of the Public Utility
60-18 Commission of Texas;
60-19 (ii) a member of the Texas Department of
60-20 Commerce;
60-21 (iii) a member of the Texas Board of
60-22 Aviation;
60-23 (iv) a member of the Texas Air Control
60-24 Board;
60-25 (v) a member of the Texas Alcoholic
60-26 Beverage Commission;
60-27 (vi) a member of the Finance Commission of
61-1 Texas;
61-2 (vii) a member of the <State Purchasing
61-3 and> General Services Commission;
61-4 (viii) a member of the Texas Board of
61-5 Criminal Justice;
61-6 (ix) a member of the Board of Trustees of
61-7 the Employees Retirement System of Texas;
61-8 (x) a member of the State Highway and
61-9 Public Transportation Commission;
61-10 (xi) a member of the Texas Workers'
61-11 Compensation Commission;
61-12 (xii) a member of the State Board of
61-13 Insurance;
61-14 (xiii) a member of the Parks and Wildlife
61-15 Commission;
61-16 (xiv) a member of the Public Safety
61-17 Commission;
61-18 (xv) the Secretary of State;
61-19 (xvi) a member of the State Securities
61-20 Board;
61-21 (xvii) a member of the Texas Amusement
61-22 Machine Commission;
61-23 (xviii) a member of the Texas Water
61-24 Development Board;
61-25 (xix) a member of the Texas Water
61-26 Commission;
61-27 (xx) a member of the governing board of a
62-1 state senior college or university as defined by Section 61.003,
62-2 Education Code, including The University of Texas at Arlington; The
62-3 University of Texas at Austin; The University of Texas at Dallas;
62-4 The University of Texas at El Paso; The University of Texas--Pan
62-5 American; The University of Texas--Pan American--Brownsville; The
62-6 University of Texas of the Permian Basin; The University of Texas
62-7 at San Antonio; The University of Texas at Tyler; The University of
62-8 Texas Southwestern Medical Center at Dallas; The University of
62-9 Texas Medical Branch at Galveston; The University of Texas Health
62-10 Science Center at Houston; The University of Texas Health Science
62-11 Center at San Antonio; The University of Texas System Cancer
62-12 Center; The University of Texas Health Science Center at Tyler;
62-13 Texas A&M University; Texas A&M University at Galveston; Prairie
62-14 View A&M University; Tarleton State University; Corpus Christi
62-15 State University; Texas A&I University; Laredo State University;
62-16 East Texas State University; East Texas State University at
62-17 Texarkana; University of Houston; University of Houston--Clear
62-18 Lake; University of Houston--Downtown; University of
62-19 Houston--Victoria; Lamar University at Beaumont; Lamar University
62-20 at Orange; Lamar University at Port Arthur; Midwestern State
62-21 University; University of North Texas; Texas College of Osteopathic
62-22 Medicine; Stephen F. Austin State University; Texas Southern
62-23 University; Texas Tech University; Texas Tech University Health
62-24 Sciences Center; Texas Woman's University; West Texas State
62-25 University; Angelo State University; Sam Houston State University;
62-26 Southwest Texas State University; Sul Ross State University; Sul
62-27 Ross State University--Uvalde Center; Texas State Technical
63-1 Institute--Amarillo; Texas State Technical Institute--Harlingen;
63-2 Texas State Technical Institute--Sweetwater; and Texas State
63-3 Technical Institute--Waco;
63-4 (xxi) a member of the Texas Higher
63-5 Education Coordinating Board;
63-6 (xxii) a member of the Texas Employment
63-7 Commission;
63-8 (xxiii) a member of the State Banking
63-9 Board;
63-10 (xxiv) a member of the board of trustees
63-11 of the Teachers Retirement System of Texas;
63-12 (xxv) a member of the Credit Union
63-13 Commission;
63-14 (xxvi) a member of the School Land Board;
63-15 (xxvii) a member of the board of the Texas
63-16 Department of Housing and Community Affairs;
63-17 (xxviii) a member of the Texas Racing
63-18 Commission;
63-19 (xxix) a member of the State Board of
63-20 Dental Examiners;
63-21 (xxx) a member of the Texas Board of
63-22 Licensure for Nursing Home Administrators;
63-23 (xxxi) a member of the Texas State Board
63-24 of Medical Examiners;
63-25 (xxxii) a member of the Board of Pardons
63-26 and Paroles;
63-27 (xxxiii) a member of the Texas State Board
64-1 of Pharmacy;
64-2 (xxxiv) the Banking Commissioner of the
64-3 Banking Department of Texas;
64-4 (xxxv) a member of the Department of
64-5 Information Resources Governing Board;
64-6 (xxxvi) the fire fighters' pension
64-7 commissioner;
64-8 (xxxvii) a member of the Texas Motor
64-9 Vehicle Commission;
64-10 (xxxviii) the director of the Office of
64-11 Court Administration of the Texas Judicial System;
64-12 (xxxix) the chief executive of the Office
64-13 of Public Utility Counsel;
64-14 (xl) a member of the Texas Real Estate
64-15 Commission;
64-16 (xli) a member of the board of directors
64-17 and the executive director of the State Bar of Texas;
64-18 (xlii) a member of the Bond Review Board;
64-19 (xliii) a member of the Texas Board of
64-20 Health;
64-21 (xliv) a member of the Texas Board of
64-22 Mental Health and Mental Retardation;
64-23 (xlv) a member of the Texas Board on
64-24 Aging;
64-25 (xlvi) a member of the Texas Board of
64-26 Human Services;
64-27 (xlvii) a member of the Texas Funeral
65-1 Service Commission;
65-2 (xlviii) a member of the board of
65-3 directors of a river authority created under the constitution or
65-4 laws of this state;
65-5 (xlix) the executive director of the Texas
65-6 Lottery Commission <lottery division in the office of the
65-7 comptroller>; <or>
65-8 (l) the deputy in charge of the department
65-9 of security in the Texas Lottery Commission; or <lottery division
65-10 in the office of the comptroller>
65-11 (li) a member of the Texas Lottery
65-12 Commission.
65-13 SECTION 39. Sections 2.04(j) and 4.06(g), State Lottery Act
65-14 (Article 179g, Vernon's Texas Civil Statutes), are repealed.
65-15 SECTION 40. (a) This Act takes effect July 1, 1993, if this
65-16 Act may take effect on that date under Article III, Section 39, of
65-17 the Texas Constitution.
65-18 (b) If this Act does not take effect as provided by
65-19 Subsection (a) of this section, this Act takes effect September 1,
65-20 1993, except that Section 39 of this Act takes effect August 31,
65-21 1993.
65-22 (c) The Texas Lottery Commission is created on the effective
65-23 date of this Act. In making the initial appointments to the
65-24 commission, the governor shall designate one member for a term
65-25 expiring in 1995, one member for a term expiring in 1997, and one
65-26 member for a term expiring in 1999.
65-27 SECTION 41. (a) On the earliest date on which an executive
66-1 director and at least two members of the Texas Lottery Commission
66-2 have been appointed and hold office:
66-3 (1) all powers, duties, rights, and obligations of the
66-4 comptroller relating to the administration, operation, and
66-5 regulation of the state lottery are transferred to the Texas
66-6 Lottery Commission;
66-7 (2) except as provided by Subsection (b) of this
66-8 section, all assets, liabilities, personnel, equipment, data,
66-9 documents, facilities, and other items of the comptroller relating
66-10 to the administration, operation, and regulation of the state
66-11 lottery are transferred to the Texas Lottery Commission; and
66-12 (3) any appropriation to the comptroller relating to
66-13 the administration, operation, and regulation of the state lottery
66-14 is transferred to the Texas Lottery Commission.
66-15 (b) The comptroller may decide whether to transfer to the
66-16 Texas Lottery Commission:
66-17 (1) personnel who perform both duties that relate to
66-18 lottery operations and duties that do not relate to lottery
66-19 operations; and
66-20 (2) assets used both in lottery operations and
66-21 operations other than lottery operations.
66-22 (c) The officers and employees of the office of the
66-23 comptroller shall cooperate fully with the reorganization.
66-24 (d) Until at least two initial members of the Texas Lottery
66-25 Commission are appointed and hold office, the comptroller exercises
66-26 the powers and duties of the commission, and a reference in the
66-27 State Lottery Act (Article 179g, Vernon's Texas Civil Statutes) is
67-1 considered to be a reference to the comptroller.
67-2 (e) Until the initial executive director of the Texas
67-3 Lottery Commission is appointed and takes office, the comptroller
67-4 serves as the executive director, and a reference in the State
67-5 Lottery Act (Article 179g, Vernon's Texas Civil Statutes) to the
67-6 executive director of the Texas Lottery Commission is considered to
67-7 be a reference to the comptroller.
67-8 SECTION 42. (a) A change in law made by this Act does not
67-9 affect:
67-10 (1) the validity of any action taken by the
67-11 comptroller or the lottery division in the office of the
67-12 comptroller under the State Lottery Act (Article 179g, Vernon's
67-13 Texas Civil Statutes) before the effective date of the change in
67-14 law; or
67-15 (2) a civil, criminal, or administrative proceeding
67-16 completed before the effective date of this Act.
67-17 (b) A change in law made by this Act does not affect the
67-18 validity of a civil, criminal, or administrative proceeding,
67-19 including licensing or rulemaking, in progress on the effective
67-20 date of the change in law. A civil, criminal, or administrative
67-21 proceeding under the State Lottery Act (Article 179g, Vernon's
67-22 Texas Civil Statutes) that is in progress on the effective date of
67-23 this Act continues as if it had been initiated by the Texas Lottery
67-24 Commission under the law in effect on the effective date.
67-25 (c) All forms, rules, and procedures adopted by the
67-26 comptroller for the administration and enforcement of the State
67-27 Lottery Act (Article 179g, Vernon's Texas Civil Statutes) and in
68-1 effect on the effective date of this Act remain in effect on or
68-2 after that date as if adopted by the Texas Lottery Commission until
68-3 amended, repealed, withdrawn, or otherwise superseded by the Texas
68-4 Lottery Commission. A license issued under the State Lottery Act
68-5 (Article 179g, Vernon's Texas Civil Statutes) and in effect on the
68-6 effective date of this Act remains in effect according to its terms
68-7 as if issued by the Texas Lottery Commission until the license
68-8 expires or is revoked or surrendered.
68-9 (d) A change in law made by this Act applies only to an
68-10 offense committed on or after the effective date of this Act. For
68-11 the purposes of this subsection, an offense is committed before the
68-12 effective date if any element of the offense occurs before that
68-13 date.
68-14 (e) An offense committed before the effective date of this
68-15 Act is covered by the law in effect when the offense was committed,
68-16 and the former law is continued in effect for this purpose.
68-17 SECTION 43. The importance of this legislation and the
68-18 crowded condition of the calendars in both houses create an
68-19 emergency and an imperative public necessity that the
68-20 constitutional rule requiring bills to be read on three several
68-21 days in each house be suspended, and this rule is hereby suspended,
68-22 and that this Act take effect and be in force according to its
68-23 terms, and it is so enacted.