HBA-ALS H.B. 3688 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 3688
By: Flores
Licensing & Administrative Procedures
3/30/1999
Introduced



BACKGROUND AND PURPOSE 

Since the creation of the Texas Lottery, charitable bingo in Texas has
suffered declining profits which are allocated to charitable organizations.
In 1996, a Senate interim committee conducted an extensive study on the
operation and regulation of charitable bingo. While many of the committee's
recommendations were implemented through the passage of H.B. 2086 by the
75th Legislature, several items were not addressed.    

H.B. 3688 sets forth regulations governing satellite bingo. This bill
requires a person to obtain a satellite bingo service provider's license in
order to provide satellite bingo services. This bill sets forth the
licensing requirements relating to application information, application
fees, and bonding.  

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the Texas Lottery Commission in SECTION
2 (Section 11b, Article 179d, V.T.C.S. (Bingo Enabling Act)) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 2, Article 179d, V.T.C.S. (Bingo Enabling Act),
by adding Subdivision (30) to define "satellite bingo game."   

SECTION 2.  Amends Article 179d, V.T.C.S. (Bingo Enabling Act), by adding
Section 11b, as follows: 

Sec. 11b.  REGULATION OF SATELLITE BINGO.  Provides that Sections 11(e),
(i), and (j) of this Act do not apply to a satellite bingo game.
Authorizes the Texas Lottery Commission (commission), by rule, to exempt a
satellite bingo game or a person conducting or participating in a satellite
bingo game or who holds a license under this Act from any other provision
of this Act, if the commission determines the exemption is necessary to
facilitate the operation and administration of satellite bingo games.  

SECTION 3.  Amends Article 179d, V.T.C.S. (Bingo Enabling Act), by adding
Section 13g, as follows: 

Sec. 13g.  SATELLITE BINGO SERVICE PROVIDER'S LICENSE.  (a)  Provides that
a person must obtain a satellite bingo service provider's license from the
commission in order to provide satellite bingo services for the use of
licensed authorized organizations. 

(b) Provides that an applicant for a license under this section must file
with the commission a written application which includes specified
information. 

(c)  Provides that a person is not eligible for a license under this
section if the person has been convicted of specified crimes within the
last 10 years or the person is an owner, officer, or director of a holder
of a commercial lessor licensed under this Act.  

(d)  Establishes that the fee for a satellite bingo service provider's
license is $5,000 plus  any cost incurred to conduct the criminal
background checks.  

(e)  Requires the revocation of a license for a satellite bingo service
provider if any disqualifications under this section occur within the
license period.  

(f)  Authorizes a satellite bingo service provider to purchase goods or
services from a licensed manufacturer.  

(g)  Authorizes the commission, upon receiving a complaint, to inspect the
satellite bingo service provider's services. Requires the satellite bingo
service provider to provide to the commission any information requested
that relates to the complaint.  

(h)  Requires a satellite bingo service provider to be bonded in the amount
of $50,000.  

(i)  Requires a satellite bingo service provider to establish a bank
account and requires the provider to deposit all proceeds from each
satellite bingo game, less any prizes paid. Authorizes  disbursement from
the satellite bingo bank account for payment of prizes; payment of taxes
and fees on prizes;  allocation payments to participating licensed
authorized organizations; payments for facility access fees; and payments
to a satellite bingo service provider for operating costs.  

(j)  Requires allocation payments to a licensed authorized organization
participating in satellite bingo to be made monthly.  Requires that an
organization receive a portion of the satellite bingo proceeds and
specifies the formula for computing the portion that an organization
receives.     

SECTION 4.Effective date: September 1, 1999. 

SECTION 5.Emergency clause.